mitie group plc annual report 2006
we never 
stand still £9356m turnover up 170
£507m profit before tax preamortisation up 93
98p earnings per share up 116
43p dividend per share up 265
mitie is one of the uk’s leading
support services companies
we are also one of the uk’s largest employers
with over 39000 people supporting our
customers everyday
mitie provides all of the services that a business
may wish to outsource including catering
cleaning landscaping security reprographics
maintenance and pest control
mitie also improves buildings for its customers
offering services such as refurbishment
painting and air conditioning installation mitie group plc 1
w we never stand still 
mitie is a company with ambitions for our people 
our customers and our shareholders fulfilling these
ambitions means we never stand still
mitie has had an excellent twelve months
during the year the group has made a number of
important acquisitions grown organically and won 
a series of exciting contracts with a clear strategy 
for the future we are extremely well placed to grow 
the business 
contents
mitie at a glance 2
chairman’s statement 4
chief executive’s review 10
chief operating officer’s review 12
group finance director’s review 28
corporate responsibility 32
board of directors 36
directors’ report 37
directors’ remuneration report 39
corporate governance 43
independent auditors’ report to the members of mitie group plc 47
consolidated income statement 48
consolidated statement of recognised income and expenditure 49
consolidated balance sheet 50
consolidated cash flow statement 51
notes to the consolidated financial statements 52
independent auditors’ report to the members of mitie group plc 82
company balance sheet 83
notes to the company financial statements 84
notice of annual general meeting 89
shareholder information 91 2 mitie group plc
growing together
ever since mitie started there has been a common theme to our progression as
a company… growth the group has not only grown financially over the years
we have also grown our people the number of customers and the level of
service we provide to them
central to this commitment is our unique business model mitie which stands for
management incentive through investment equity stands out from its peers
because it offers entrepreneurs the chance to develop a business idea in line
with the core services offered by the group with the hard work enthusiasm and
customer dedication of a small company and the support and professionalism
of a large plc these businesses can then develop and grow 
we place particular emphasis on enabling our people to develop to their 
full potential in the belief that if we look after them they will look after our
customers our employees are therefore focused on working hard together and
supporting and listening to their customers we serve many sectors both public
and private and provide an extensive range of services with one common
focus… our customer 
mitie at a glance
39000 employees 
6128 customers
19 years of growth
1mitie mitie group plc 3
our values… together we are mitie
mitie people are motivated knowledgeable and passionate about their
customers they are also rewarded respected and properly equipped for 
their jobs we train and develop our staff and we care about their health 
and safety
we provide opportunities for our employees to grow so that our customers
receive loyalty added value the ability to focus on their core business flexibility
quality services responsiveness and choice we listen to our customers’ needs
communicate effectively and work in partnership to provide multiple services
this means that our shareholders and the communities in which we operate
receive sustainable performance longterm commitment and corporate
responsibility mitie is an entrepreneurial company with good governance 
strong management financial stability and a clear strategy
a proven track record of growth
profit before tax dividend based on ordinary shares of 25p
88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05
5
4
3
2
1
0
06 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05
60
50
40
30
20
10
0
06
support services £345m
property services £90m
engineering services £72m
cleaning £2047m
catering £136m
landscaping £44m
pest control £47m
security £872m
managed services £823m
business services £168
engineering maintenance £1023m
property services £1635m
engineering services £2561m
profit by segment turnover by service
£m p
year year
1988–2004 reported under uk gaap 2005 restated under ifrs
profit before tax preamortisation 4 mitie group plc
this has been an exceptional year for mitie we have continued our
track record and delivered an impressive set of results completed our
largest ever acquisition and won a series of new and exciting contracts
across a number of emerging and established markets with a clear
corporate strategy we are extremely well placed for the future
chairman’s
statement
mitie provides a comprehensive range of support
services to both public and private sector 
clients in the uk we will build on our success by
further strengthening the range of services we 
offer and by providing service excellence for 
all our customers 
mitie has achieved 19 years of consecutive
revenue profit and dividend growth and now
employs over 39000 staff our success is testament
to the group’s unique culture which motivates both
management and staff to grow the business by
concentrating on the needs of our customers 
the dedication of our employees our core skills in
managing and motivating a large and diverse
workforce and our passion to support our customers
is a real and valuable differentiator in the marketplace
on behalf of the board i would like to welcome the
employees of our acquired companies to the
group and thank everyone in mitie for their
contribution to our success and their hard work 
over the financial year 
results
turnover in the period rose to £9356m 2005
£7997m an increase of 170 on continuing
operations while profit before tax and intangible
amortisation from continuing operations excluding
other operating income rose by 93 to £507m
2005 £464m basic earnings per share eps
increased by 116 to 98p 2005 88p whilst eps
preamortisation other operating income and
discontinued activities rose by 102 to 106p 
2005 96p
dividend
the board is recommending a final dividend of 24p
per share which gives a total of 43p 2005 34p 
for the year this represents an increase of 265 
the dividend will be paid on 29 september 2006 to
shareholders on the register at the close of business
on 8 september 2006 
the dividend cover based on the group’s profits 
for dividends declared in the year is 25 times 
the dividend cover for dividends paid in the year 
is 31 times
share buyback programme
we continued the share buyback programme
started in the previous financial year and purchased
992305 mitie group plc ordinary shares of 25p at
an average price of 1626p the highest price paid
was 1640p while the lowest price paid was 1585p
all shares purchased have been cancelled 
we will be seeking to renew the authority granted
by our shareholders to purchase up to 100 of the
issued share capital of the company at our next
annual general meeting on 27 july 2006 
acquisitions
the year was exceptional in terms of our 
acquisition activity 
firstly we made four external acquisitions in the year
at a total consideration of £916m including initial
security ltd our largest acquisition to date 
secondly and in accordance with our unique
business model we purchased the minority interests
in seven mitie businesses for a total purchase
consideration of £94m 
three of our external acquisitions were in the security
sector an area we have been strategically targeting
and saw us purchase
• initial security ltd the uk manned guarding
business of rentokil initial for £708m including
repayment of debt in march 2006 
• the watch security ltd a provider of manned
guarding and electronic security solutions in the
midlands for £80m in june 2005 and
• intruder international ltd a specialist provider of
electronic security solutions in the uk for £40m 
in may 2005 
profit before tax £m
05 464
06 507
dividends p
05 34
06 43
£1010m
invested in acquisitions in 200506
 preamortisation and other 
operating income providing security as a single service to tate britain in london
supplying gallery attendants to museums is a special niche in the security market
attendants do not t play a ‘traditional’ security role but are employed predominantly 
to be on hand to enhance the vi isitors’ experience providing information and
assistance in exhibition halls the number of attendants needed at a museum is
subject to fluctuation and dependent on the type and scale of exhibition which
means that mitie may need to provide anywhere between three and 33 assistants
from day to day a at tate britain we have been doing so since 1995 because we are
able to provide the right calibre o of attendant and value of service to meet the
customer’s needs and demonstrate exceptional flexibilit ty
we protect
creativity
mitie helps guide over 15 million people through tate
britain every year providing a bundled service of cleaning and waste
management for newcastle international airport
mitie has been providing multiple services to newcastle international airport since
1997 and looks a after everything from the terminal and air traffic control building 
to the freight village and onsite aviation academy we help our client keep their 
facilities in top condition for both staff and t the public providing services as wide
ranging as checkin desk and window cleaning trolley collection and repair and
waste and recycling we have nearly 50 operatives working at the airport 24 hours s 
a day 365 days a year who make the building run smoothly helping airport staff to
concentrate o on getting people off the ground mitie has added value to the customer
by being able to provide an e extensive and flexible portfolio of services by adapting 
to their needs and by understanding the a airport’s mission statement ‘one team
working together’ and making it our objective to fulfil it
we support
takeoff
on average every mitie employee on site walks
between five and six miles a day at a pfi school in darlington with our facilities 
management services
being part of the unique concept of bringing together a primary secondary and
special needs school in one campus to enable the teaching of 1400 students 
was not only an exciting development for da arlington and its local community but 
for mitie and the future of national education we mobilised  the 25year contract 
to deliver fm services in september 2005 partnering with our client to provid de 
better educational facilities for children and improved sustainable assets for local
communities  with 40 employees on site we are responsible for a full range of 
fm services including helpdesk c cleaning catering me maintenance security and
grounds maintenance as well as for the lifecycle m maintenance of all of the buildings
mitie was selected because we were able to provide the managemen nt and services
needed to support the facilities and property infrastructure
we manage 
the future
mitie provides support services to 40 pfi schools 
across the uk we inspire
passion
in our employees through our ethos and culture
mitie understands that the business simply wouldn’t have found the success it has to
date without it ts employees recognising that our people are our most valuable asset
means we make sure that they a are treated as such they are motivated properly
trained and equipped rewarded and respected we provide opportunities for their
growth and in return they provide opportunities for ours listening an nd responding 
to our customers and securing and retaining contracts year on year adding value
ensu uring loyalty and providing quality services for clients not only means that
customers are satisfied d but that shareholders are too achieving sustainable
performance and longterm commitment
mitie employs approximately 39000 individuals across
the business mitie group plc 9
chairman’s statement continued
these acquisitions have transformed our security
business into a strong nationwide operation which is
now ranked as the uk’s second largest provider of
manned guarding the integration of the businesses
is on plan we are confident that our security
business has considerable potential for the future
lyndhurst services ltd a provider of external
grounds maintenance to commercial property 
sites across the uk was also acquired by mitie 
the purchase of this company in february 2006 
for £88m has added to mitie’s regional coverage in
the landscaping market and has been an important
development in our strategy of growing that business
board changes
there have been a number of changes to the mitie
group plc board ruby mcgregorsmith previously
group finance director was appointed chief
operating officer in september 2005 while 
suzanne baxter was appointed group finance
director following the year end in april 2006 
david jenkins and ishbel macpherson have both
joined the board as nonexecutive directors during
the period bringing with them considerable
financial and professional experience manish
chande has retired from the board as nonexecutive
director after four years of service i would like to
thank him on behalf of the board for his valuable
contribution to the development of the group
pensions
in march 2006 the group made a oneoff
contribution of £78m to eliminate the actuarial
deficit on the mitie group plc pension scheme 
this is the group’s principal defined benefit pension
scheme and is now closed to new entrants 
corporate governance 
the board recognises its responsibilities in terms 
of ensuring that mitie achieves high standards 
of corporate governance and conducts itself
appropriately in order to protect the interests 
of all mitie stakeholders
corporate responsibility 
this year we are acting to improve our communication
with mitie stakeholders on matters concerning
corporate responsibility we are therefore publishing
a separate report that will also be available on our
corporate website which expands further on the
areas already covered in this annual report the
report will look in more detail at how mitie motivates
and looks after its people relates to the community
works with charities and behaves in relation to our
environmental responsibilities 
outlook
mitie has a solid track record in developing a
profitable business and it is our strategy to 
ensure that this continues we will seek to grow
further organically and will make acquisitions 
within our chosen markets when appropriate
opportunities arise 
we will continue managing our business in a manner
which facilitates sustainable growth and delivers
service excellence for our customers we are
developing national coverage across the portfolio
of services we provide which will enhance our
ability to work with customers across many sites
providing multiple services 
the support services market is increasingly looking
for companies who are able to offer a wide range
of services with their own workforce and we are
clearly benefiting from that trend as a result of this
we expect significant contract opportunities 
which when combined with the energy and
commitment of our employees will ensure mitie 
will continue to prosper 
we are well positioned for future growth
d david c ord
chairman
£78m
c contribution to pension scheme 10 mitie group plc
support services has achieved strong organic
growth engineering services has continued to
experience some difficulties in achieving an
acceptable margin within a highly competitive
market and as we indicated in our interim report 
a certain amount of restructuring has taken place
which produced a better outcome for the business
in the second half of the year property services has
had an excellent year developing our position in the
social housing market and we announced at the
end of march their success in gaining a substantial
repair and maintenance contract with birmingham
city council
the performance of our individual operating
companies during the year is covered in more 
detail in the chief operating officer’s review 
strategy
mitie has had a consistent strategy for a number of
years and we are confident that it is appropriate for
the challenging environment we face the strategy
covers all aspects of mitie including the markets in
which we operate our customers the people and
resources that we need and our impact in terms of
corporate responsibility
1 organic growth
we operate in markets that are growing and are
fragmented this enables mitie to achieve good
levels of organic growth by taking market share
from competitors and benefiting from the increasing
trend towards the outsourcing of noncore services
we are able to increase market share because of
the excellence of our services and the passion of
our employees who are committed to supporting
our customers and helping them to achieve their
business goals it is our aim to grow all of our
businesses to a level where our position in the
market is in the top five by size 
2 bundled services
there is a distinct movement towards bundled
services we define a bundle as when a customer
has chosen to take more than one mitie service 
on the same site rather than a full facilities
management service this typically occurs when a
customer wishes to maintain an active involvement
in the management of their facilities but is looking 
to rationalise its supply chain bundles can start from
any of our mitie businesses particularly when we
have an excellent relationship with a customer on
site recent building services research and
information association data shows that between
2002 and 2005 the proportion of contracts that are
run as bundles has increased from 200 to 300 
3 acquisitions
we are continuing to look for acquisitions that 
fit with our range of services when making 
an acquisition we pay particular attention to 
three issues
a cultural fit – mitie has a strong entrepreneurial
culture that has been built over the past 19 years
we carefully evaluate whether the business
culture of any acquisition is similar to ours this 
is primarily related to the approach at an
operational level and to an obsession with
customer service which involves listening to
customers’ needs providing excellent services
having a determination to succeed and a desire
to work closely with other mitie businesses
b opportunity for growth – the markets in which 
an acquisition takes place must have growth
potential the majority of our recent acquisitions
have been in the manned guarding market 
we believe that with the increasing awareness of
security matters and the impact of the licensing
of the security industry there will be ongoing
changes in this sector which will create
opportunities for us 
c quality of management – the success of mitie
has come from the strength and motivation of 
its management teams we always consider the
abilities of the management when looking at
potential acquisitions to ensure they will fit with
the rest of the group and have the ability to run
and grow their business independently
4 the ‘mitie model’
this year we have started three companies in the
property services business services and catering
divisions startup companies tend to have very high
rates of growth but their impact on the group’s
growth rates will be progressively reduced we
believe that the opportunities provided to the
managers of our startup companies should also 
be available to those in our more mature businesses
where they have not had an equity stake it is our
intention to extend the ethos of the ‘mitie model’
through our second generation equity plan we
recapitalised our cleaning business with shareholder
approval in 2004 and we intend to seek shareholder
approval to recapitalise property services in 2006 
chief executive’s
review
it has been a year of great progress within mitie we were particularly
delighted to acquire the manned guarding business of rentokil initial
towards the end of the year this acquisition will transform our security
business and after integration with our existing security companies 
it will have revenue in excess of £200m 
strategy
1 organic growth
2 bundled services
3 acquisitions
4 the ‘mitie model’
5 invest in our people
6 new markets
7 corporate responsibility
organic growth by service
support services     117
engineering            112
property services                      266 1
2
3
4
5
6
13
7
8
9
10
11
12
mitie group plc 11
5 invest in our people
to ensure that our customers receive quality service
and that we have the right skills in the business
going forward we regularly evaluate the abilities of
our employees and provide them with appropriate
training and development we have also expanded
our core skills competency so that we are able to
offer additional services we prepare for growth and
change within mitie by maintaining succession plans
for all of our businesses
6 new markets
there are some customers that prefer to work with
businesses who specialise in their sector such as
retail transport and social housing we have structured
our businesses to ensure that we meet the needs of
those customers and have achieved good results to
date we will establish additional specialist
businesses where appropriate and anticipate that
this strategy will produce strong profitable growth
7 corporate responsibility
it is becoming increasingly important for a business
to be able to demonstrate that it behaves in a way
that is responsible in terms of how it treats its
employees interacts with customers and suppliers
relates to the community and charities and manages
relationships with other stakeholders mitie is a
responsible business and is producing a separate
corporate responsibility report for the first time this
year which will be published with our annual report
and accounts this report will also be available on
our website wwwmitiecouk
forward order book
mitie has benefited from the longer term nature 
of many of our contracts the contracts in support
services have an average term of three years and
this is now lengthening with several extending to
five years or more property services has an order
book that is increasing rapidly as a consequence 
of its success in winning social housing partnering
contracts and engineering services has a high level
of its revenue secured for 2006 the overall percentage
of budgeted group revenue secured for 2007 is
720 compared to 700 last year 
markets
we have always maintained that mitie benefits 
from having a broad mix of customers and that 
this spread reduces our risk in terms of potential
downturns in a sector we also believe that a good
balance between public and private sector work
provides protection from any particular changes in
government policy 
people
we place great emphasis on the development 
of our people without a motivated workforce to
satisfy customers we do not have a business we
now employ over 39000 people and are immensely
proud of their achievements the management of
such a large and diverse skilled and semiskilled
workforce is our core competency and we have
very robust processes in place to manage both 
the efficiency and development of our employees 
we have a range of training and management
development programmes in place across the
group these vary from very specific training such
as the usage of chemicals for our pest control
operatives to customer service training for our
receptionists in business services to senior
management strategy courses we also recognise
the achievements of our employees with several
award schemes which cover all our employees
across the group
mitie is aware that as the economy grows there will
be skills shortages in some of the trades we need
we are therefore establishing a network of mitie skills
centres in secondary schools across the uk where
we are supporting vocational skills training we
established four in 2005 and will be opening another
four in 2006 we are also working closely with
regional development agencies such as the east
london business alliance to recruit apprentices into
mitie businesses
i would like to thank our employees personally for
their hard work and dedication over the past year
and their contribution towards this very good set 
of results
future prospects
mitie is in excellent shape for future growth 
we have a very strong management team a
substantial customer base in growing markets 
a motivated and passionate workforce and 
a business model that is sufficiently flexible to 
react to market changes our markets will 
remain competitive but the agility of our
management and their leadership will enable 
mitie to continue growing
there is an energy and spirit in mitie that is 
very rare and this makes me very positive about 
our prospects 
ian r stewart
chief executive officer
forward order book
revenue by market sector
03 640
04 670
05 700
06 720
forward order book is the
percentage of revenue
secured for the following
financial year as at 31 march
1 commercial
2 finance and professional
3 leisure and entertainment
4 manufacturing
5 retail
6 science and technology
7 utilities
8 social housing
9 local authority
10healthcare
11government
12education
13defence 12 mitie group plc
chief operating
officer’s review
m mitie support services
support services encompasses a number of
complementary services including cleaning
catering landsc cape pest control security
managed services business services and
engineering maintenance
it has had an excellent year with major single and
bundled service contract awards for engineering
maintenance and security and with key
acquisitions in security and landscape
2006 2005 growth
£m £m £m 
revenue 5160 4402 758 172
segment  
operating profit 328 291 37 127
mitie cleaning
cleaning provides services to offices industrial
buildings transport healthcare facilities and retail
premises services include window cleaning
computer cleaning food hygiene recycling and
waste management
cleaning has performed in line with expectations
and has had a good year achieving organic
growth of 79 
during the year cleaning reviewed its customer
base and in response to customers’ changing
needs has separated the management of its
national contracts from that of its site managed
contracts two new customer orientated services
have been created – ‘connect’ which focuses 
on larger site managed contracts and ‘cleaning
and national accounts’ which delivers single 
and multisite contracts through the national
infrastructure of the business our newly structured
business has been recapitalised in line with the mitie
second generation equity plan
major contract awards for cleaning across the uk
include those at celtic football club and queen
margaret university college in the south significant
contract awards include motorola and sutton
council in london we secured a new contract 
with ubs 
business retendered and retained in the year
included our contracts at yorkshire water services
united utilities kellogg’s and homebase our
contract at the historic royal palaces was extended
to include both cleaning and waste management
at the tower of london a further major extension
from a renewed contract was at barclays bank
where the scope of our work was extended from
607 to 1211 branches
outside the traditional cleaning offering mitie
waste  environmental provides specialist
environmental advice and services to over 700 sites
this is an increasingly important differentiator in the
market and initiatives such as the treehugger™
have proved to be very popular with clients this
desktop recycling facility sold almost 25000 units 
last year
the profile of mitie waste  environmental has been
raised by the external recognition it has received for
its services in november 2005 the business won four
awards including one gold and two silver green
apple accolades for environmental best practice
mitie waste  environmental also won the prestigious
sustainability category at the premises and facilities
management partnership awards for its contract
with hewlettpackard together with our customer
we have been working on the development of a
sustainable workplace by improving the recycling
capacity of the hp invent plant in scotland 
mitie also won two kimberleyclark golden service
awards during the year firstly the best cleaned
office below 15000 square feet award which was
for our contract with birmingham midshires building
society and secondly the best cleaned transport
facility which was in recognition of our contract
with dover harbour board
we anticipate continued progress for this business in
200607 with further strong growth expected in
retail and transport cleaning 
mitie has seen another year of double digit growth and strong
financial performances our support services and property services
businesses have performed exceptionally well and we are pleased 
to report recovery within our engineering business 
we have made a number of important acquisitions during the year
dominated by the acquisition of initial security ltd which provide
scale and growth opportunities for our security and landscape
operations we remain well placed to continue our strategy of
profitable growth investment and service excellence
cleaning services
our award winning
cleaning business 
which employs over
20000 people 
services the palace 
of westminster  
the scottish parliament
and the welsh assembly over one million vehicles per annum go through mitie
controlled gatehouses at gist
supplying gist with security services
the current contract originally mobilised by initial security ltd sees us providing a
range of guarding services to 14 gist sites throughout the uk supporting them to
ensure that their environment is both efficient and safe the range of services we offer
across the sites include access and egre ess control asset protection front of house
duties and monitoring traffic movements provided by al lmost 100 employees and a
dedicated specialist contract manager to oversee work on sites we add valu ue by
integrating technology to improve the efficiency of the guarding activity providing
continuity y of service and by linking into the gist business to aid the performance 
of their sites we also wr rite newsletters and hold quarterly and annual awards in
partnership with our client and work closely y with them to resolve any security or 
safety concerns
we guard
assets in december 2005 mitie served over 9700 customers
and sold 1338 of our home made muffins
with our catering at hamleys toy store
at the end of 2005 mitie was awarded a fiveyear contract to provide hamleys with
catering services s offering hospitality for visitors bespoke catering for children’s
parties as well as catering fo or product launches and events in the store mitie’s vision
to create something different for our cli ient did not stop at originality and commitment
to fresh food and nutrition as part of our partnersh hip and dedication to innovation we
invested in the refurbishment of the hamleys café bar and instal lled a new kids zone
designed to enable us to provide an educational experience for children who vis sit the
store inviting them to spend time with the chef and get involved in cooking the kids
zone n not only teaches but also entertains with events such as ‘halloween lunch’ or
‘brunch with santa’ k keeping over 500 children amused across the school holidays at
the end of last year
we feed
imaginations mitie group plc 15
m mitie catering
catering offers hospitality and executive dining
vending consultancy services and employee
caterin ng to a wide range of clients across the uk
catering has continued its growth in event catering
and has seen an encouraging level of interest from
prospective clients particularly in niche commercial
catering contracts within visitor attractions and 
retail venues 
in london our startup business is developing well
and has won a number of exciting new contracts
these include the café in hamleys toy superstore on
regent street london and the jaeger café which
is also located on regent street in their flagship
store the new jaeger café opens in summer 2006
the menu has been designed to reflect fair trade
produce which is organic fresh and seasonal
these are important factors for jaeger corporate
clients who will have the opportunity to hire the café
for special events 
in london bayerische hypound vereinsbank ag will
also be employing catering for their new moorgate
building which operates a café bar and provides
hospitality for some 500 members of staff while for
the landflex contract the business will provide
hospitality vending and café services across their
new estate which so far comprises four buildings
current bidding activity is focused on the increasing
demand for corporate catering within a client’s
building which typically has limited facilities but
requires high quality food service we have
however also seen a rise in the number of tenders
for significant multisite national catering contracts
an area previously restricted to the larger national
catering companies 
we believe this shift is largely attributable to the fact
that catering now has national operational reach
an example of the type of national contract being
sought is the ntl incorporated catering contract
which was awarded to catering in january 2006
the contract spans twelve sites including belfast
glasgow teeside manchester nottingham luton
hook and swansea 
market conditions remain challenging and
competition is strong but we are pleased to have
developed a good pipeline of new and existing
contracts catering will continue to pursue organic
growth in 200607 and will look to achieve a higher
market share going forward 
m mitie landscape
landscape encompasses a traditional range of
services including grounds maintenance sports
ground a and leisure facilities care exterior landscape
design installation and maintenance including golf
c courses the business also provides arboriculture
and interior tropical plant services 
landscape performed well during the year and
achieved organic growth of 1200
in february 2006 we acquired the grounds
maintenance business lyndhurst services ltd
lyndhurst serving commercial property sites across
the uk lyndhurst complements mitie’s existing
landscaping and grounds maintenance business
and has significantly increased its ability to provide
customers with a broader range of services the
acquisition has expanded the scale of this business
and it is now bidding for larger national contracts
new work secured this year includes fiveyear
contracts with both the city of york council and
west lindsey district council and an additional two
years for the national lloyds tsb contract which
sees our northern and southern businesses working
together on landscape’s largest secured contract
we have also renewed our contracts at boc
headquarters in surrey and the uk government
home office contract
landscape is also working with its mitie pfi
colleagues on the ealing schools project and in
addition has secured work to landscape other new
schools with costain the international engineering
and construction group
this business will benefit from the acquisition of
lyndhurst and we anticipate continued growth 
in 200607
landscape services
we acquired grounds
maintenance business
lyndhurst services
limited in february
2006 for £88m
catering services
our ntl incorporated
contract is operated
across twelve locations
spanning england
wales scotland and
northern ireland
chief operating officer’s review continued 16 mitie group plc
mitie pest control
pest control offers insect bird and other pest
management services
the pest control market remains very competitive
with the largest two operators continuing to dominate 
during the year pest control which has contracts
with compass group for its service facilities at
twickenham stadium in london and the millennium
stadium in cardiff has won a number of new
contracts which include those with balfour beatty
construction and meridian healthcare
going forward the pest control market is likely to
remain very fragmented and we will therefore look
to improve margins by expanding our skills base and
service offering
mitie security
security provides static guarding electronic and
mobile guarding gallery attendants front of hous se
and warden services key holding consultancy and
remote monitoring services for its clients
this has been an excellent year for security with
three acquisitions and strong organic growth in our
existing business the organic growth rate was 178
in may 2005 we acquired intruder international ltd
intruder a specialist provider of electronic security
solutions and in june 2005 acquired midlands
based the watch security ltd the watch the
purchase of the watch a manned guarding and
electronic security business completed our national
footprint in the sector the acquisition enabled
security to offer a more comprehensive service to
clients and consequently compete for larger
national contracts while our security business is still
primarily focused on the manned guarding sector
the acquisition of intruder and strategic alliances
with security consultancy companies has meant
that security is better able to provide its customers
with total security solutions an example of this is our
expanded contract with the department for
communities and local government formerly the
office of the deputy prime minister where the
manned guarding provision is now being
complemented by a hightech electronic security
system provided by intruder
in march 2006 mitie acquired initial security ltd isl
a leading uk manned guarding company whose
services include contract guarding aviation
security key holding patrol and alarm response
services its client base covers a wide range of
sectors from government and commercial to
industrial and retail providing services at over 2000
sites more than 6000 staff throughout the uk
transferred to mitie from isl the acquisition has
added specialist aviation and retail work to
security’s portfolio of services and has further
strengthened its regional operations 
the acquisition of isl has transformed security and 
it is now the second largest manned guarding
business in the uk the integration plan is progressing
well and we expect to realise significant synergy
benefits across the business while the acquisition is
expected to be earnings enhancing in the year
ending 31 march 2007 the benefits of the cost
savings will be absorbed by the integration costs in
the first full year of ownership the financial benefits
of integration are therefore expected to be realised
in the financial year ending 31 march 2008
on 20 march 2006 it became illegal in england and
wales to work as or supply a contracted manned
security officer without a security industry authority
sia licence this change to the industry’s legislative
framework has seen our investment in training
rewarded as security has met all the sia licensing
deadlines becoming one of the first companies to
achieve approved contractor status acs
this has been a very exciting year for 
security and our focus is now on integrating 
our acquisition and consolidating our national
presence we will look to capitalise on our
investments and expect good growth in the future 
chief operating officer’s review continued
pest control services
mitie pest control
provides services for
twickenham stadium
in london and the
millennium stadium 
in cardiff
security services
we spent £828m on
security acquisitions in
200506 and are now
the second largest
manned guarding
business in the uk mitie cuts over 90 million square metres of grass 
every year
providing landscaping services for dtz across the uk
three years plus 28 industrial estates retail parks and office complexes and 
45 employees equal ls one landscaping contract with property advisors dtz
debenham tie leung our acquisition of lyndhur rst services limited on 17 february
2006 a company providing external grounds maintenance services a across england
scotland and wales and employing over 240 people also brought many contracts 
to com mmercial property sites we keep dtz’s real estate looking good providing
landscape maintenance and  external cleaning services like litter picking and
sweeping to varied sites across the uk as part of a three year contract we offer
added value by assigning dedicated client account managers to each facilities
manager at dtz as well as keeping our customer up to date with regular site reports
all lowing them to monitor the condition of their portfolio
we maintain
images with our cleaning services for transport for london 
london bus services limited 
london bus services limited has an immense cleaning requirement with over 6600
glass bus shelters  and more than 18800 bus stops throughout the capital most of 
the work needs to be carried out dur ring the night to ensure our client can run their
business as smoothly as possible for the public it  services mitie manages the contract
via several dedicated managers and administrators who are supp ported by night
supervisors and mobile teams all employees involved are focused on delivering
qualit ty services which include cleaning all bus shelters on a fortnightly basis all 
stops on a quarterl ly basis and all shelter roofs twice a year to further enhance the
standards maintained specialised reaction teams are deployed to perform duties
including the removal of graffiti from shelters and s stops the posting of bus timetable
information and publicity material we have also designed and imp plemented a
sophisticated routing device to ensure the most productive working patterns are
adopted b by employees
we put wheels
in motion
mitie’s cleaning services enhance the 63 million bus
journeys londoners make every weekday mitie provides fm services to other governmental
departments including the department for
communities and local government formerly the
office of the deputy prime minister
delivering facilities management services to the department
for culture media and sport
providing fm services to four buildings for the department for culture media and sport
dcms in ce entral london means we’re in the business of backing dreams with over
50 full and parttime employee es delivering services such as fm management 
front of house helpdesk and cleaning mitie is helpi ing the government concentrate 
on making the olympics a success as well as supporting all the department’s other
activities outsourcing these services to us and knowing that they are in trusted 
han nds means that dcms can focus on their core business they know that we can
bring subject experts on nboard like our energy manager who has worked in close
partnership with our client to develop an en nergy plan which will lead to significant
cost savings over two years and energy savings in the regio on of 496 tonnes of 
carbon dioxide 
we champion
dreams we distribute and archive over 36 million documents
for the bank each year
at morgan stanley with our business services offering
we’ve been providing morgan stanley with mail room and archiving services since
august 2004 our ach hievements to date include the introduction of a customer
services desk to provide a single point of contact for all services and an automatic
call distribution system to manage the flow of incoming e enquiries the streamlining 
of the internal mail sortation process the introduction of a dedicated  distribution
service for investment banking reprographics work and the installation of our
auditabl le electronic mail tracking system
we have a 38 strong workforce that services six buildings in cana ary wharf covering
600am to 1100pm five days a week our employees add value not only by listenin ng
to the client and ensuring the service provided meets with their needs but by
constantly endeavouring to introduce initiatives to enhance the services and further
reduce costs
we deliver
results mitie group plc 21
m mitie managed services
managed services encompasses facilities
management building and estate management
integrated servi ice delivery pfi private finance
initiative service delivery procurement and supplier
evaluations s and consultancy to a wide range of
customers across a number of sectors
managed services has had a very good year
making a considerable improvement in its
profitability and winning new contracts which will
impact the next financial year
managed services secured a threeyear contract
with the department for culture media and sport
delivering facilities management full maintenance
and fabric services to four of their buildings in
central london this contract has been further
extended at the end of the year to cover the 
big lottery fund buildings in birmingham newcastle
glasgow and london it was also awarded a
contract with tmobile that covers ten major 
tmobile buildings 15 switch centres and 130 retail
outlets across the uk 
managed services has recently launched an energy
awareness initiative with the national offender
management service noms at their offices in
staffordshire and nottingham with the ultimate aim
being to establish best practice in all noms offices
throughout the uk the initiative has been designed
to make employees more aware of their environment
encouraging energy efficient behaviour both in the
home and the workplace 
with the growing number of customers seeking
external strategic advice on energy use 
in the business place we have grown the
management team to accommodate the rise 
in demand 
the business has been awarded six new pfi school
projects where it provides full facilities management
services mitie has not taken equity participation in
these projects the contracts vary in length but are
all between 25 to 30 years the total number of pfi
education facilities services contracts awarded to
mitie now equates to some 15 of the total market
which positions the business as a market leader in its
specific sector
overall the business has had a very profitable year
and is well placed for further growth
m mitie business services
business services provides mail room management
reception and switchboard facilities services
reco ords management reprographics print
management and distribution management 
to its clients
business services has seen a definitive shift in the
market towards bundled services and with its broad
service offering the business has achieved some
major contract awards business services now
provides customers with a full spectrum of
document management services ranging from
creative design to digital and lithographic printing
through to logistics and distribution services from its
document solutions and mail solutions centres 
our bundled business services offering with other
mitie areas of expertise continues to be a significant
advantage for business services it has recently
delivered success in a new business services
contract at the european headquarters of the walt
disney company which is a bundled solution for the
provision of their mail switchboard reception
cleaning services and maintenance 
our mail services reprographics and porterage
contract at the london stock exchange was also
extended in the year for a further three years and
has now been bundled with services from cleaning
our reprographics contract at the international
investment bank abn amro was expanded in the
year and now includes the provision of mail services
it is now one of the largest contracts for the business
in the city of london 
law firm osborne clarke awarded business services
a bundled services contract for their prestigious 
new london offices where the business provides
reception catering and cleaning business services
was also recently appointed by 3i to manage the
mail reprographics and cleaning services at their
new headquarters in victoria london
the largest contract award for business services
during the year has been at pricewaterhousecoopers
with the award of a fiveyear contract for document
management distribution services reprographic
services mail and record management which is
valued at over £50m 
business services has introduced a new suite of
technology tools these build on the success
experienced with previous systems which had been
developed over the past six years and are amongst
the most advanced in the marketplace the new
offering delivers many of the tools to client desktops
via the internet or client intranets and includes print
submission courier shipping document tracking and
stationery ordering 
overall business services has had a good twelve
months in terms of business development the
outlook remains very positive and we believe there
are many exciting opportunities in the future
business services
our pricewaterhouse
coopers contract is
the largest business
services’ contract win
to date and is worth in
excess of £50m
chief operating officer’s review continued
managed services
mitie managed
services won six new
pfi school projects in
200506 and the total
forward order book
associated with these
projects is valued
today at c £280m 22 mitie group plc
mitie engineering maintenance
engineering maintenance provides heating 
lighting ventilation and air conditioning
maintenance m mechanical and electrical systems
boiler maintenance plumbing and water hygiene
and estate mainten nance to a variety of clients
throughout the uk
engineering maintenance has delivered a strong
performance during the year experiencing an
exceptional level of organic growth at 388 
new contracts include those at four united states
air force bases in england and at the paddington
central and sheldon square project the latter
contract which began in january 2006 comprises
mechanical and engineering maintenance services
with some small property maintenance work in both
commercial and residential accommodation 
the business also secured work in december 2005
with the university of the arts in london where it is
providing mechanical and engineering maintenance
services and property maintenance work for the
university property portfolio of 21 buildings 
new contracts which have been awarded 
but not yet started include those at the 
fort shopping centre in birmingham and at vertex
a subsidiary of united utilities where we provide
services to buildings in london the midlands 
the north of england and scotland under a 
threeyear contract
retendered business includes a twelvemonth
contract with the uk government foreign and
commonwealth office at their buildings in london
and hanslope park contracts with microsoft 
which is bundled with cleaning and the alliance
and leicester were also resecured during the
period while the scope of the aig contract 
which was originally for two buildings in london 
has significantly increased to cover all their 
regional offices
engineering maintenance continues to provide
extensive bundling opportunities for the group
acting as a springboard for our full range of services
we were recently awarded a threeyear contract
with the bank of england for their sports facilities
which will be mobilised in conjunction with
cleaning our maintenance contract with dell
computers has been expanded to include their
city park complex in glasgow and now includes
work for cleaning
engineering maintenance has had an exceptional
year and we remain confident of further success
and progress for the business in 200607 
mitie property services
property services provides refurbishment 
and interior fitout work office furniture painting
rep pair and maintenance roofing plastering
partitioning industrial flooring and fire protection to
c clients the recent birmingham city council contract
is an excellent demonstration of the success the e
business is achieving in social housing which
by its nature encompasses many of property
services’ ’ activities
2006 2005 growth
£m £m £m 
revenue 1635 1291 344 266
segment operating 
profit 89 76 13 171
property services has had a very good year with
significant growth in turnover and profits organic
growth was up at 266 there has however been
some pressure on profitability which is likely to
continue this year as the work mix moves towards
social housing 
the particular success in the year is the recently
awarded birmingham city council social housing
contract which is worth in excess of £90m over four
years with an option to extend for an additional
three years the contract commenced on 
1 april 2006 and covers the repair and maintenance
of housing in the southern area of the city this
covers 27000 properties and involves over 80000
repairs per annum 
in addition property services also mobilised a
contract with milton keynes council to provide
responsive and void property repairs to its entire
portfolio of 12000 homes the fiveyear contract
started on 1 april 2006 and is estimated to be worth
in excess of £25m with an option for the council to
extend for an additional five years
property services is working with yorkshire coast
homes southampton city council the glasgow
housing association and leeds city council
amongst many others and in total the business now
holds contracts with over 150 local authority and
housing associations throughout the uk
market conditions for this division remain
encouraging with social housing and the fitout
sector in london being particularly buoyant 
the outlook for the business is very positive 
chief operating officer’s review continued
property services
we provide repair and
maintenance to some
27000 properties as
part of our new
birmingham city
council contract
engineering
maintenance
this business has given
a strong performance
during the year and
experienced an
exceptional level 
of organic growth 
at 388 in 2005 mitie responded to 2673 call outs for ants
and 1869 for wasps
providing pest control for homeserve
mitie provides homeserve with a general pest control service for reactive call outs to
residential properties across the uk we have not only reduced our client’s costs but
added value by offering co onsistency of service across the uk providing a 24 hour
helpline for the end user and cutting down o on homeserve’s administration what’s
more we have also ensured a complete control programme is in place as opposed
to a oneoff visit for each pest problem mitie has more than 60 technicians servic cing
the contract across the uk who are ably supported on the helpdesk by our pest
control division’ ’s office staff in cheltenham employees were rewarded for the high
level of service provided when ho omeserve presented mitie with an award at their
annual ‘contractor of the year 2005’ event
we take the
sting out every year mitie helps maintains the ideal environment
for the nbs to collect test process store and issue over
19 million blood donations from 16 million donors
providing engineering maintenance to the national blood
service
following a review of its me maintenance activities the national blood service nbs
decided to pr rocure its support services through competitive tender choosing to
partner with mitie from an initi ial contract for the provision of me services to four
regional nbs centres at newcastle leeds sheffield and manchester mitie has since
extended the work to include a further 18 satellite buildings  we deliver comprehensive
planned preventative maintenance and emergency reactive support as well a as
general and essential services ranging from fire alarms generators heating and
ventilation to water treatment and fixed wire testing we work in close partnership with
our client to ensure our employees are correctly inducted and fully understand the
key processes and national operations requir red to support the national blood service 
we keep the
blood flowing mitie completed engineering work for more than
110 establishments in the education sector in 2005
with our engineering services at bristol university
mitie has been associated with bristol university as the provider of mechanical and
electrical insta allations since 1996 when it completed the installation of the heating
equipment at the famous wills memorial building the success of this project secured
our position as the me building services contractor assisting our client’s consulting
team to design and build the university’s prestigious synthetic chemistry buildings 
a landmark project under the national engineering contract created to o promote
partnering this not only featured as a test case in the uk government’s egan report
which h looked to make recommendations for reform to ensure increased industry
efficiency but also cemente ed our relationship with the university with mitie
completing more than 15 contracts to date 
we enlighten
minds in 2005 mitie worked with more than 150 social
housing providers with a combined housing stock of
over 800000 properties
at partick housing association with our responsive
maintenance services
mitie signed a responsive maintenance partnering agreement with partick housing
association representing one of the largest ever community investments of its kind in
scotland the partnership aims to o significantly improve the level of housing maintenance
service received by the association’s 3000  residents under the four year ‘mitiepartick
partnership’ mitie will provide responsive property m maintenance and refurbishment
services to approximately 1700 of the association’s owned houses and more than 1300
privately owned properties in glasgow the work includes plumbing electrical rewiri ing
glazing carpentry heating building works and improvement programmes such as
bathroom and kit tchen refurbishments within void properties under the social housing
partnering arrangement standards of service have been set so that residents can be
assured of a consistent high level of service  as a result residents and property owners
will benefit from a coordinated approach to the improvem ment of their property which 
in turn will help to increase the desirability and value of housing in n their area
we maintain
standards mitie group plc 27
m mitie engineering services
engineering services covers the installation of
mechanical and electrical systems information and
communication technology air conditioning utilities
infrastructure and retail engineering serving a a wide
range of clients from many different sectors 
2006 2005 growth
£m £m £m 
revenue 2561 2304 257 112
segment operating 
profit 64 76 12 158
engineering services has experienced a challenging
year but margins improved in the second half of the
year during the period we closed the engineering
services ‘cleanrooms’ and ‘scientific projects’
businesses and restructured operations in the
midlands and leeds the restructured business has
achieved organic growth of 112
engineering services has a strong forward order
book largely consisting of repeat work from blue
chip clients the business has contracts with
rhondda hospital the university of manchester and
ibm amongst others and has grown its existing
contracts with a number of clients including
plymouth university and land securities trillium
social housing technology retail and utilities work
has been very encouraging and the business has 
a pipeline of repeat orders that extends into 2008 
during the year the business has been involved in 
a number of exciting projects including the thomas
deacon city academy in peterborough this
prestigious new academy was designed by lord
foster and engineering services was appointed to
work with laing o’rourke on the mechanical and
electrical design and installation package 
in london the business was appointed as the 
subcontractor for mechanical and electrical work
on the new victoria and albert museum garden 
this work has now been completed and the garden
was officially opened by hrh the prince of wales
and will be used for corporate functions throughout
the summer
while this has been a challenging year our
restructured business has a good forward order
book margins in this business still remain under
pressure and improving them remains the focus
going forward 
future prospects
during the period we have seen strong performances
from mitie support services and mitie property
services mitie engineering services has had a
challenging year but steps have been taken to
ensure it is better positioned for the future and we
are starting to see the benefits of this
the quality and strength of our individual businesses
and people continues to drive growth in turnover
and profits for the group by focusing on our
customers and their needs we are confident that
we can grow our business and our market share
further we will continue our track record of success
throughout this financial year by building on our
strengths concentrating on the integration of our
recent acquisitions and growing our bundled 
service offering
we have a strong customer focus that provides 
a solid basis for profitable growth in the future
r ruby mcgregorsmith
chief operating officer
chief operating officer’s review continued
engineering services
mitie engineering
services has
restructured operations
and is focused on
margin improvement 28 mitie group plc
introduction
we are pleased to present the financial results of the
group for the year ended 31 march 2006 
this is the first financial year in which the group 
has reported its results under international financial
reporting standards ifrs an explanation of the
transition to ifrs was provided in our transition
statement which accompanied the interim report
released on 28 november 2005 and is reproduced
in note 32 of this report all comparatives throughout
this report have been restated under ifrs
revenue
revenue from continuing operations increased by
170 to £9356m 2005 £7997m revenue from the
businesses acquired during the year was £242m
excluding the effect of the acquisitions revenue
from continuing business grew by 140 
each of our three operational segments reported
strong double digit growth in revenue during the
year after the effect of acquisitions revenue 
growth rates in support services property services
and engineering services were 172 266 and
112 respectively
profit from operations
profit from operations excluding other operating
income has increased by 86 to £481m 2005
£443m other operating income in 2005 of £15m
related to the profit on the sale of a property that
did not recur in 2006 
support services and property services reported
growth in their segment profit from continuing
operations of 127 and 171 respectively
segment operating profit from continuing
operations in engineering reduced by 158 
investment income and finance costs
investment revenue and finance costs totalled
£24m 2005 £21m investment revenue related 
to interest on the overall net funding position of 
the group 
profit before tax and intangible amortisation
profit before tax and intangible amortisation pbta
increased by 58 to £507m 2005 £479m pbta
from businesses acquired during the year was £02m
after integration costs
discontinued items
the loss for the year on discontinued operations of
£24m relates to the final settlement on the disposal
of the mitie access contracting businesses in june
2002 this amount was paid in october 2005
intangible amortisation
intangible amortisation was £02m 2005 £nil and
represents the amortisation of intangible assets
recognised on acquisitions made during the year
over the estimated lives of those assets there was
no similar charge in the prior year since no third
party acquisitions were made in that period
group finance
director’s review
our financial results are underpinned by strong operational cash
flows acquisitions made during the year have changed our profile
and have enhanced the efficiency of our balance sheet we have 
a sound financial platform for future profitable growth
170
i increase in revenue from continuing operations mitie group plc 29
profit before tax
profit before tax for the year was £505m 2005 £479m
tax
the tax charge for the year was £155m a rise of
115 on last year’s charge of £139m the effective
rate of tax for the group was 307 2005 298 
the group’s effective rate of tax before
amortisation was 306 2005 298
pensions
the group operates two defined benefit pension
schemes and a defined contribution scheme for its
employees as described in note 29 the total
pension charge under ias 19 for the year was £37m
2005 £32m 
in response to the deficit on our principal defined
benefit scheme the group made a special
contribution of £78m to that scheme in march 2006
in order to eliminate the funding deficit we have
closed the scheme to new members and have
decreased the final salary ratio effective for the
years of service after this change the latest
actuarial valuation under ias 19 ‘employee benefits’
shows a pretax surplus of £18m 2005 deficit £76m
at the year end the net asset position of 
the scheme was positively affected by the
performance of equities and the slight improvement
in the aa bond rate this movement is reflected
within the statement of recognised income 
and expense
earnings per share eps
eps is based upon profits after tax and minority
interests and represents the amount of profit earned
by a share
the calculation of eps has been based on the
weighted average number of shares in the year of
3059 million 2005 3064 million
basic eps grew by 116 2005 down 211 
to 98p 2005 88p 
basic eps preamortisation discontinued operations
and other operating income in 2005 grew by 102
to 106p 2005 96p
diluted eps grew by 118 to 97p 2005 87p
diluted eps preamortisation discontinued
operations and other operating income in 2005
grew by 105 to 105p 2005 95p
dividends
in 2004 we set a dividend policy to achieve an
annual dividend cover of no more than three times
we review this policy on a regular basis
the total dividend cover for the year based on the
profits earned in the year and dividends proposed in
the year is 25 times 2005 29 times
the total dividend per share for the year is 43p
2005 34p an increase of 265 
the proposed final dividend per share for the year is
24p 2005 18p an increase of 333
share buybacks
the company has acquired 03 of its own share
capital in the year equating to 992305 shares 2005
10310006 all of which were cancelled in total
these cost £16m 2005 £146m 
acquisitions
mitie acquired four businesses from third parties
during the year
on 3 may 2005 mitie acquired 100 of the share
capital in intruder international ltd intruder 
the consideration of £40m was paid in cash 
the acquisition gave rise to goodwill of £35m 
and acquisition costs of £02m no intangible asset
was recognised on acquisitions from the date of
ownership intruder contributed £39m to the
revenue and a loss of £04m to the pbta of the group
4
e external acquisitions
116
i increase in earnings per share 30 mitie group plc
on 30 june 2005 mitie acquired 100 interest in the
watch security ltd the watch the consideration
of £80m comprised £60m in cash at completion
and £20m deferred consideration dependent on
postacquisition performance the acquisition gave
rise to goodwill of £64m and acquisition costs of
£02m intangible assets arising on the acquisition of
£08m relate to customer lists and are being amortised
on a straightline basis over their expected useful 
life of eight years from the date of ownership the
watch contributed £135m to the revenue and
£03m to the pbta of the group
on 17 february 2006 mitie acquired 100 interest in
lyndhurst services ltd lyndhurst the consideration
of £88m comprised £82m in cash at completion
and £06m in deferred consideration dependent on
post acquisition performance the acquisition gave
rise to goodwill of £49m and acquisition costs of
£01m intangible assets arising on the acquisition of
£35m relating to customer lists have been recognised
and are being amortised on a straightline basis over
their expected useful life of six years from the date
of ownership lyndhurst contributed £07m to the
revenue and £01m to the pbta of the group
on 7 march 2006 mitie acquired 100 interest 
in initial security ltd isl the consideration of
£591m was entirely paid in cash while other debts
of some £116m were also assumed the acquisition
gave rise to goodwill of £598m and acquisition costs
of £06m intangible assets arising on the acquisition
of £75m relating to customer lists have been
recognised and are being amortised on a 
straightline basis over their expected useful life 
of eight years from the date of ownership isl
contributed £61m to the revenue and £02m to 
the pbta of the group
treasury 
group treasury has responsibility for managing and
reducing financial risk and ensuring sufficient liquidity
is available to meet foreseeable needs it operates
within policies and procedures approved by the
board which have not changed during the year
borrowings are arranged centrally by group treasury
and made available to operating subsidiaries on
commercial terms the board’s ongoing policy is 
to finance the group through retained earnings 
and borrowings 
the maturity profile of banking facilities is reviewed
regularly and the facilities are extended and
replaced as appropriate well in advance of 
their expiry
further details on financial assets and liabilities are
given in the notes to the accounts and in particular
details on the bank overdraft and loans in note 17
cash flows
the net funds position of the group in the year
moved from an opening cash position of £615m to
a closing net cash position of £76m with loans of
£310m which were drawn down in march 2006 to
partially fund the acquisition of initial security ltd all
loans are repayable within one year but can be
rolled over at our option the movement in the
group’s net funds position this year is largely
attributable to the outflow of £850m including net
overdrafts acquired of £66m used to finance our
external acquisitions in addition at acquisition mitie
repaid the loan in initial security of £116m 
£532m
c cash generated by operations
group finance director’s review continued mitie group plc 31
the total net cash outflow for the year was 
£539m 2005 inflow £120m excluding new loans 
of £310m 2005 £nil the cash outflow was £849m
2005 inflow £120m
cash generated by operations before interest tax
and additional pension contribution was £532m
2005 £467m 
nonrecurring cash payments that were made 
in the year were a special contribution to the group
defined benefit pension scheme of £78m and final
settlement amounts on the disposal of the mitie
access contracting business of £24m
included in cash and cash equivalents are deposits
totalling £96m 2005 £38m held by the group’s
insurance subsidiary which are not readily available
for the general purposes of the group
minorities
in accordance with the mitie model on 24 august
2005 the group acquired some or all of the minority
interests in the following subsidiaries for a total
consideration of £94m see note 24
• mitie air conditioning wales ltd
• mitie air conditioning west ltd
• mitie business services ltd
• mitie engineering services retail ltd
• mitie engineering services swansea ltd
• mitie security north ltd
• mitie security scotland ltd
capital expenditure
capital expenditure as a percentage 
of turnover
as the group has grown and continues to grow
strongly measuring total capital expenditure does
not provide a useful indicator of performance we
therefore measure our net capital expenditure as a
percentage of turnover since 1999 this has fallen
from 46 of turnover to 12 in the current year
capital expenditure for the year was £138m 
2005 £140m
this clearly reflects the full year effect of the
completion of the group’s stated objective to move
away from capitalintensive businesses the disposal
of mitie generation ltd in september 2004 was the
final step in achieving this objective
our policy not to invest in heavily capitalintensive
businesses allows us to reduce the amount of
capital tied up in longterm projects and to direct
funds to other areas which generate greater
shareholder value
s suzanne baxter
group finance director
£138m
c capital expenditure
1999 2000 2001 2002 2003 2004 2005 2006
00
10
20
30
40
50
60
year 32 mitie group plc
corporate responsibility
people 
at mitie our employees are our most valuable
resource without them our business simply would
not operate or have achieved the success it has
to date we are suitably dedicated to looking
after motivating incentivising and developing our
people as well as safeguarding their welfare
training and development
mitie has always endeavoured to ensure that all of
its employees have the opportunity to maximise
their potential achieve their goals and progress
their careers our training and development
programme is therefore varied to suit different
fields and levels indeed our focus on our people
has been recognised externally one such
example is the east london business alliance’s
‘employer of the year’ 2005 award
communication
we have continually worked hard to keep our
employees fully informed of developments within
the business using a number of tools including a
new employee intranet an improved inhouse
magazine and the launch of an inhouse
newspaper the first mitie employee forum held in
november 2005 and chaired by the chief
executive also marked a significant stage in our
employee engagement programme underlining
the group’s recognition of the importance of
informing and consulting with employees 
recognition and reward 
mitie believes that exceptional effort and
outstanding performance deserves recognition
reward and thanks an idea reflected in the
numerous high profile award initiatives throughout
the business 
health and safety 
the need to maintain a safe and healthy
workforce remains extremely important for mitie
we are constantly striving to improve our safety
performance and exceed the levels demanded
by external standards this is taken extremely
seriously from the board down commencing with
the chief executive who has overall responsibility
for health and safety mitie continues to place the
training of all employees at the forefront of
improving standards throughout the organisation
and we are constantly developing our own
specific health and safety training packages in
response to our employees’ needs 
mitie’s definition of corporate responsibility is to achieve commercial
success in ways that honour ethical values and respect people
communities and the natural environment this means behaving
responsibly and having a positive impact on the environment as well
as on everyone who has some association with mitie from employees
and customers to suppliers and the wider community our chief
executive has overall accountability for our corporate responsibility
and is spearheading the campaign to drive forward improvements
throughout the business mitie has divided its work on corporate
responsibility into four principal areas to be focused on in the future
people environment community and charity at the mitie skills centres
the first skills centre was opened at st luke’s school in 2002 in portsmouth 
this establishment un nderwent such an impressive transformation with significantly
improved pass rates that we could not t ignore the results mitie’s community affairs
manager karen govier was selected to rollout the n national campaign to provide
students with the opportunity to learn vocational skills and coordinat ted the opening
of the first two new centres in wigan and bristol in summer 2005 the next one was
la aunched in october in sunderland where we fittedout our third construction centre
with areas for w wet trades dry trades and a classroom here the students have the
space and tools to learn a range  of construction trades as well as the theory behind
them mitie staff act as mentors to students wh ho show a real interest and who may
later be employed as apprentices which not only provides a sense of personal
satisfaction but starts to address the shortage of skilled labour in the industry
we nurture
potential
the mitie skills centre helped st luke’s to obtain the
seventh most improved pass rates nationwide mitie’s sponsorship of ten employees at the 
exhibition led to one individual selling a sculpture 
to a private collector
supporting employees in their pursuits
when mitie says that one of its corporate objectives is ‘to develop our employees fully’
we really  mean it with that in mind earlier this year we sponsored several of our
security staff that are usually employed as gallery attendants at museums around
london to exhibit their own work ten empl loyees from tate britain tate modern 
the royal academy of arts and the hayward gallery took part exhibiting work at 
‘la viande’ a contemporary art space at the heart of the capital which has previously
hosted work by some of the uk’s brightest emerging artistic talent we created this
opportu unity because mitie understands that developing someone is not just about giving
them the right job a and the tools to further their career it’s also about helping them to
grow as an individual and purs sue their interests perhaps that’s one of the reasons our
people are so dedicated to what they do… because we’re committed to them
we encourage
expression… mitie group plc 35
environment
as part of mitie’s commitment to protecting the
environment we aim to identify monitor evaluate
and manage the impact of our activities as a
business in line with our environmental policy
across the organisation our dedication to
achieving the levels of environmental
performance demanded by the external
standards of iso 14001 is proven with over 80 of
the group’s activities in terms of employee
numbers covered our association with external
corporate responsibility organisations such as
business in the community bitc and ftse 4 good
index series provides an independent assessment
of our performance initiatives such as the
planting of 2000 trees in the midlands to
counteract the impact of the carbon dioxide
emissions from that region’s vehicle fleet also
underline our commitment to the environment
and sustainability
mitie is always looking to share best practice with
stakeholders and the wider community this year
energy awareness initiatives helped clients adopt
an energyefficient culture and beat government
targets our work with clients to shape and deliver
sustainable practices is award winning too
including four international green apple awards
this year highly regarded accolades that focus on
environmental best practice
community 
our everyday activities have always placed us at
the very heart of the communities in which we
work our peoplefirst culture and cando attitude
means that we have achieved much and inspired
many in the past few years with 200506 being
one of our most active yet perhaps the most
substantial example of our commitment is our
national initiative to build construction skills centres
at schools throughout the uk enhancing students
vocational skills educational achievements and
the longterm employment prospects of young
people see case study
mitie initiated an apprentice scheme offering
unemployed young men and women from east
london the chance of finding longterm work with
mitie our client morgan stanley was so impressed
that they awarded mitie their ‘local community
initiative award 2005’ other activities included
clearing up community grounds decorating
special educational needs classrooms and
helping to clear up a stretch of the thames
riverbank during london sustainability week to
benefit local communities
charity 
fundraising activities for our charity of the year
cancer research uk included national initiatives
and regional challenges as well as individual
efforts raising over £66000 in the last year with
mitie group plc matching the sums raised this
reached an impressive £132000 of particular note
in 200506 was the ‘round britain driving
challenge’ where six employees drove nearly
3000 miles around the country stopping at the
group’s offices to collect money pledged by 
their colleagues not forgetting to offset the
vehicles’ carbon emissions by planting trees
to become more involved with the communities in
which we operate mitie has decided to support
several regional charities for 200607 our employees
voted for yorkhill children’s foundation in scotland
christies cancer hospital in manchester cancer
research uk in the midlands clic sargent for the
south west trinity hospice london for the south
east and naomi house children’s hospice in the
southern region 
this year we have produced a separate
corporate responsibility report to help us improve
communication with all of our stakeholders we
understand that it is vital to let them know that we
manage our business in a way that reflects the
type of organisation we strive to be the first
choice provider of support services 
for more information on corporate responsibility at
mitie visit wwwmitiecouk or request a hard copy
of the report by emailing crmitiecouk 
corporate responsibility continued 36 mitie group plc
board of directors
david ord‡ 
nonexecutive chairman
aged 57 he was appointed to the board in october 2002 and
became chairman in september 2003 he is managing director of
the bristol port company
sir john jennings cbe frse†‡ 
nonexecutive deputy chairman chairman of the nomination
committee and senior independent nonexecutive director
aged 69 he became a director in 1998 he is a director of bechtel
group international and a member of bechtel’s board of councillors
and chancellor of loughborough university he was previously
chairman of the shell transport and trading company plc and until
recently was a member of the international advisory board of
toyota corporation
ian stewart 
chief executive
aged 64 he was appointed to the board in january 1990 and
became chief executive in august 2001 he is also a nonexecutive
director of generation uk ltd
colin acheson 
director responsible for engineering services
aged 55 he joined the group in december 1989 and was
appointed to the board in august 2001 he is also a nonexecutive
director of the platform company holdings ltd the platform
company uk ltd and the british quality foundation
roger goodman 
group corporate development director
aged 59 he joined the group in june 1993 and was appointed to
the board in august 2001 he also serves as a director of the business
services association and asset skills a sector skill council he was
recently appointed chairman of networkers international plc 
colin hale 
head of support services
aged 49 he joined the group in april 1998 and was appointed to
the board in august 2001
ruby mcgregorsmith aca
chief operating officer
aged 43 ruby joined the group in december 2002 as group
finance director she was appointed chief operating officer 
on 9 september 2005 
bill robson 
director responsible for property services
aged 55 he joined the group in january 1992 and was appointed
to the board in august 2001
suzanne baxter aca
group finance director
aged 38 suzanne was appointed to the board on 10 april 2006
having previously worked at serco group plc she is an advisory
board member of opportunity now a part of the business in the
community organisation  
cullum mcalpine†‡ 
nonexecutive director and chairman of the audit committee
aged 59 he was appointed to the board on 1 april 2003 
he is also a director of sir robert mcalpine ltd and chairman 
of renewable energy systems ltd
ishbel macpherson†‡ 
nonexecutive director and chairman of the 
remuneration committee
aged 45 ishbel was appointed to the board on 28 july 2005 
she is also a director of the university of westminster and 
game group plc
david jenkins fca†‡ 
nonexecutive director
aged 62 he was appointed to the board on 1 march 2006 he was
previously a partner in deloitte  touche llp london until his
retirement in may 2004 while at deloitte  touche llp he was not
involved in the audit of mitie group plc or in providing services to
the group he is advisor to several companies and is also a
governor of downe house school 
 member of the remuneration committee
† member of the audit committee
‡ member of the nomination committee mitie group plc 37
directors’ report
the directors submit their report together with the audited
financial statements for the year ended 31 march 2006
p principal activity and business review
the principal activity of the group is the provision of services to
buildings and infrastructure the principal activity of the company
is to provide management services to the group
the review of the year’s operations key risks and future
developments are contained in the chairman’s statement 
the chief executive’s review the chief operating officer’s
review the finance director’s review and corporate
governance statement
d donations
charitable contributions made during the year amounted to
£105800 2005 £85300 included in donations were £66000 to
cancer research uk the remainder of the donations were made
to local charities serving the communities in which the group
operates as a matter of policy no political contributions were
made during the year 2005 £nil
s share capital
details of changes in the share capital during the year and the
number of ordinary shares in issue at the year end are set out in
note 22 to the accounts
s share buyback programme
in june 2004 the company commenced a share buyback
programme which has continued pursuant to the renewed
authority given by shareholders at the annual general meeting in
2005 during the year to 31 march 2006 the company purchased
a total of 992305 ordinary shares representing 03 of the issued
share capital of the company for a total consideration of £16m
there have been no further purchases since the year end all
ordinary shares purchased have been subsequently cancelled
further details are given in note 22 to the accounts the exact
amount and timing of future purchases and the extent to which
repurchased shares may be held as treasury shares rather than
being cancelled will be determined by the company and will be
dependent on market conditions and other factors
d dividends
the directors recommend a final dividend of 24p per ordinary
share to be paid on 29 september 2006 to ordinary shareholders
on the register on 8 september 2006 which together with the
interim dividend of 19p paid on 31 march 2006 makes a total of
43p for the year 2005 34p
d directors
details of the board of directors are given on page 36 
ishbel macpherson and david jenkins were appointed 
nonexecutive directors of the company on 28 july 2005 and 
1 march 2006 respectively manish chande stepped down as a
nonexecutive director on 31 march 2006 suzanne baxter was
appointed group finance director on 10 april 2006
in accordance with the company’s articles of association 
colin acheson david ord ruby mcgregorsmith and cullum
mcalpine will retire by rotation and being eligible offer
themselves for reelection at the agm ishbel macpherson 
david jenkins and suzanne baxter all having been appointed
since the last annual general meeting will retire and offer
themselves for reelection
the board considers that the performance of those directors
proposed for reelection continues to be effective and that they
demonstrate a strong commitment to their role
details of the directors’ interests in the share capital of the
company are shown in the directors’ remuneration report
g going concern
the directors have formed a judgement that there is a reasonable
expectation that the company has adequate resources to
continue in operational existence for the foreseeable future for
this reason the directors continue to adopt the going concern
basis in preparing the accounts
p payment of creditors
the group’s policy is to comply with the terms of payment agreed
with suppliers where terms are not negotiated the group
endeavours to adhere to the suppliers’ standard terms at 
31 march 2006 the group had 55 days’ purchases outstanding
2005 56 days and the company had 17 days’ purchases
outstanding 2005 17 days
f financial instruments
the group’s policy with regards to financial instruments and 
the risks to the group are discussed in the group finance
director’s review
o other interests in shares
the company has been notified of the following interests in 
30 or more of the issued share capital of the company as at 
18 may 2006
number of  of 
ordinary shares share 
of 25 p each capital
fidelity corp and fidelity international ltd 43775764 1418
prudential plc 19630820 636
mirabaud investment management ltd 14211579 460
legal  general group plc 10252378 332
e employee involvement
communication continues to have high priority in the process of
ensuring that employees are involved in the company the group
now delivers an enhanced quarterly publication and a bimonthly
publication to all employees
our employee forum is now firmly established and has held two
meetings during the past year both meetings have been chaired
by ian stewart chief executive which indicates to the employee
representatives the importance that both ian stewart and the
group attach to this forum we look forward to an increase in
involvement and activity of our company representatives
the directors believe that employees should be encouraged to
become shareholders the savings related share option
schemes established in 1991 and 2001 currently have a total of
1529 20051561 contributing employees in addition other
employees were awarded executive share options in recognition
of achievements during the year
a auditors
in the case of each of the persons who are directors of the
company at the date when this report was approved
• so far as each of the directors is aware there is no relevant
audit information as defined in the companies act 1985 of
which the company’s auditors are unaware and
• each of the directors has taken all the steps that heshe ought
to have taken as a director to make himselfherself aware of
any relevant audit information as defined and to establish that
the company’s auditors are aware of that information
deloitte  touche llp have expressed their willingness to continue
in office as auditors and the resolution to reappoint them will be
proposed at the forthcoming annual general meeting 38 mitie group plc
directors’ report continued
a annual general meeting
the annual general meeting will be held at 12 noon on 
thursday 27 july 2006 at the merchants’ hall the promenade
clifton down bristol
the resolutions to be proposed at the agm are contained in the
notice of meeting
resolution 12 seeks a renewal of the directors’ authority to allot
shares without the prior consent of shareholders up to a nominal
amount of £780110 on 19 september 2001 the shareholders duly
conferred authority on the directors to exercise all the powers of
the company to allot relevant securities up to a specified amount
for a five year period which authority will expire on 18 september
2006 it is now proposed to seek renewal of this authority annually
and accordingly resolution 12 proposes a renewal of the existing
authority for a period expiring at the conclusion of the next
annual general meeting of the company or if sooner on 
27 october 2007 this will continue the directors flexibility to act in
the best interests of the shareholders when opportunities arise by
issuing new ordinary shares the directors will be able to issue new
ordinary shares up to a nominal value of £780110 which is
approximately equal to 101 of the companys issued share
capital as at 18 may 2006 the company held no shares in
treasury as at 18 may 2006
resolution 13 seeks a renewal of the directors’ authority to allot
new ordinary shares not exceeding 50 of the issued share
capital for cash without first being required to offer them to
existing shareholders in the proportion of their holdings 
resolution 14 seeks a renewal of the company’s authority to
purchase its own shares not exceeding 100 of the issued share
capital the directors will continue to exercise this authority if
satisfied that to do so would result in an increase in the group’s
earnings per share and would be in the interests of shareholders
generally following the introduction of the companies
acquisition of own shares treasury shares regulations 2003
companies are now permitted to retain any of their own shares
which they have purchased as treasury stock with a view to
possible reissue at a future date rather than cancelling them 
as had previously been required by legislation accordingly if 
the company were to purchase any more of its own shares it
would consider holding them as treasury stock pursuant to the
authorisation conferred by this resolution this would give the
company the ability to reissue treasury shares quickly and 
costeffectively and would provide the company with additional
flexibility in the management of its capital base
s statement of directors’ responsibilities
the directors are responsible for preparing the annual report 
and the financial statements the directors are required to
prepare accounts for the group in accordance with international
financial reporting standards ifrs and have chosen to prepare
company financial statements in accordance with 
united kingdom generally accepted accounting practice 
uk gaap
in the case of uk gaap accounts the directors are required to
prepare financial statements for each financial year which give 
a true and fair view of the state of affairs of the company and 
of the profit or loss of the company for that period in preparing
these financial statements the directors are required to
• select suitable accounting policies and then apply them
consistently
• make judgments and estimates that are reasonable and
prudent and
• state whether applicable accounting standards have been
followed subject to any material departures disclosed and
explained in the financial statements
in the case of ifrs accounts international accounting standard 1
requires that financial statements present fairly for each financial
year the company’s financial position financial performance and
cash flows this requires the faithful representation of the effects of
transactions other events and conditions in accordance with the
definitions and recognition criteria for assets liabilities income and
expenses set out in the international accounting standards
board’s ‘framework for the preparation and presentation of
financial statements’ in virtually all circumstances a fair
presentation will be achieved by compliance with all applicable
international financial reporting standards directors are also
required to
• properly select and apply accounting policies
• present information including accounting policies in a 
manner that provides relevant reliable comparable and
understandable information and
• provide additional disclosures when compliance with the
specific requirements in international financial reporting
standards is insufficient to enable users to understand the
impact of particular transactions other events and conditions
on the entity’s financial position and financial performance
the directors are responsible for keeping proper accounting
records which disclose with reasonable accuracy at any time the
financial position of the company for safeguarding the assets for
taking reasonable steps for the prevention and detection of fraud
and other irregularities and for the preparation of a directors’
report and directors’ remuneration report which comply with
the requirements of the companies act 1985
the directors are responsible for the maintenance and integrity 
of the company website legislation in the united kingdom
governing the preparation and dissemination of financial
statements differs from legislation in other jurisdictions
c corina k ross
company secretary
19 may 2006  mitie group plc 39
directors’ remuneration report
this report has been prepared in accordance with the directors’
remuneration report regulations 2002 it also meets the relevant
requirements of the listing rules of the financial services authority
and describes how the board has applied the principles of good
governance relating to directors’ remuneration as required by the
regulations a resolution to approve the report will be proposed
at the agm of the company at which the financial statements will
be approved
the regulations require the auditors to report to the company’s
members on the “auditable part” of the directors’ remuneration
report and to state whether in their opinion that part of the report
has been properly prepared in accordance with the companies
act 1985 as amended by the regulations the report has
therefore been divided into separate sections for audited and
unaudited information
information not subject to audit
remuneration committee
the committee currently comprises four of the company’s 
nonexecutive directors ishbel macpherson chairman david
jenkins sir john jennings and cullum mcalpine the committee
consults the chief executive about its proposals and has access 
to professional advice from outside the company during the year
the committee initiated an indepth review of the remuneration
structure for executive directors and senior management within the
group and engaged the services of specialist consultants to assist
this process this review is ongoing
remuneration policy
the basic salaries and other benefits of the executive directors are
determined by the committee in the light of the need to attract
retain and motivate directors of the calibre needed and to reward
them for enhancing value to shareholders the committee has
regard to executive remuneration packages of similar jobs in
comparable groups of companies 
executive directors are entitled to accept appointments outside
the group providing permission is sought from the chief executive
and to retain earnings from such appointments further details are
shown in note 30
components of remuneration
components of remuneration are
• basic salary determined by the committee and reviewed
annually on 1 april
• performancerelated bonus based on improvements in group
andor business profits
• pension contributions through membership of one of the
company’s pension schemes basic salary alone is pensionable
and
• executive share options for recently appointed executive director
service contracts 
all executive directors have rolling service contracts providing 
for a maximum of one year’s written notice there are no provisions 
for compensation payable upon early termination in the 
directors’ contracts
all nonexecutive directors are appointed under fixedterm
agreements which are due to expire on 31 march 2007 all
agreements may be renewed on expiry by mutual agreement 
or terminated on six months’ written notice by either party 
these agreements require the director to attend all meetings as
notified by the group to serve on the audit nomination and
remuneration committees as the group may request and to carry
out such additional functions as the group may require
nonexecutive directors’ remuneration
the remuneration of nonexecutive directors is determined by the
board and reflects the knowledge and experience that they bring
to the group they do not participate in the company’s bonus or
share option schemes they are not members of the company’s
pension schemes nor do they receive taxable benefits in kind 
sir john jennings’ and david ord’s remuneration comprises shares
in mitie group plc at the market value on the issue date david
jenkins ishbel macpherson and cullum mcalpine receive annual
fixed fees
performance graph – mitie’s tsr vs ftse mid 250 index
the following graph shows the company’s performance
measured by total shareholder return ’tsr’ compared with the
performance of the ftse mid 250 index over the past five years the
committee believes that this comparison provides a clear picture
of how well the company has performed relative to a range of
companies of a comparable size
tsr is defined as the return shareholders would receive if they held
a notional number of shares and received dividends on those
shares over a period of time it measures the percentage growth in
the company’s share price together with the value of any
dividends paid assuming that the dividends are reinvested in the
company’s shares
source datastream
310306
310305
80
90
100
110
120
130
140
150
300405
310505
300605
310705
310805
300905
311005
301105
311205
310106
280206
mitie
ftse 250 40 mitie group plc
directors’ remuneration report continued
i information subject to audit
remuneration
the table below provides details of directors’ remuneration paid to or receivable by each person who served as a director at any time
during the year 
d date of latest base performance benefits pensions 2006 2005
p principal salary related total total
c contract fees bonuses
£’000 £’000 £’000 £’000 £’000 £’000
e executive directors
i r stewart 1 april 2004 309 246 28 50 6 633 638
c s acheson i 1 april 2004 175 – 16 11 2 202 196
n r goodman 1 april 2004 206 164 16 11 3 397 357
c s hale 1 april 2004 232 232 16 11 4 491 476
r mcgregorsmith 1 april 2004 261 246 16 11 5 534 448
w robson 1 april 2004 175 175 16 11 3 377 366
n nonexecutive directors
d c ord chairman 26 april 2004 92 – – – 9 92 91
d s jenkins 31 jan 2006 3 – – – 3 3 –
sir john jennings 26 april 2004 80 – – – 8 80 65
i j s macpherson 27 july 2005 27 – – – 2 27 –
c mcalpine iii 3 aug 2005 29 – – – 2 29 –
f former nonexecutive directors
m j chande ii 23 sept 2002 30 – – – 3 30 24
total 1619 1063 108 105 2 2895 2661
i colin acheson waived his entitlement to bonus in this and the previous year under his service contract he was entitled to £58000 
2005 £56100
ii under an agreement to provide the group with the services of manish chande fees were paid to a third party mountgrange limited
of £29925 2005 £24338 
iii cullum mcalpine waived his entitlement to fees for the year ended 31 march 2005 in recognition of this fact mitie group plc made
contributions to charity totalling £15000
p pensions
the pension benefit of directors who are members of the mitie group plc defined benefit pension scheme is set out below
accrued pension increase in accrued real increase in a accrued pension
31 march 2005 pension during accrued 3 31 march 2006
the year pensions
£’000 £’000 £’000 £ £’000
i r stewart 115 14 12 1 129
c s acheson 32 3 2 3 35
n r goodman 18 2 2 2 20
c s hale 11 2 2 1 13
r mcgregorsmith 3 2 2 5 5
w robson 22 2 2 2 24
the following table sets out the transfer value of the directors’ accrued benefits under the defined benefit pension scheme calculated in 
a manner consistent with “retirement benefit schemes – transfer values gn11” published by the institute of actuaries and the faculty 
of actuaries
transfer value contributions increase in real increase in t transfer value
31 march 2005 made by the accrued pension accrued pension 3 31 march 2006
director over the year net of
net of contributions
contributions
£’000 £’000 £’000 £’000 £ £’000
i r stewart 1841 23 14 181 2 2378
c s acheson 321 8 3 10 3 397
n r goodman 230 8 2 15 2 294
c s hale 86 8 2 6 1 116
r mcgregorsmith 19 8 2 2 3 32
w robson 223 8 2 11 2 282
the transfer values disclosed above do not represent a sum paid or payable to the individual director instead they represent a potential
liability of the pension scheme mitie group plc 41
d directors’ interests
the beneficial interests of the directors who were in office on 31 march 2006 in the share capital of the company are as shown below
3 31 march 2006 1 april 2005
o ordinary shares or if later date
o of 25p of appointment
ordinary shares
of 25 p
n no no
e executive directors
i r stewart 4 4020000 4992872
c s acheson 1 1173100 1173100
n r goodman 1 1237213 1437213
c s hale 4 466134 641134
r mcgregorsmith 5 57494 9353
w robson 1 1500713 1814713
n nonexecutive directors
d c ord 2 200542 172769
d s jenkins – – –
sir john jennings 7 744000 894567
i j s macpherson 5 5900 –
c mcalpine 4 40000 40000
directors also had beneficial interests in the share capital of subsidiary companies as follows
3 31 march 2006 1 april 2005
n no no
r r mcgregorsmith
mitie business services ltd b ordinary shares of 1p each – – 3500
mitie catering services london ltd b ordinary shares of £1 each 5 5000 5000
mitie engineering services edinburgh ltd b ordinary shares of £1 each 2 2000 2000
mitie engineering services north east ltd b ordinary shares of £1 each 1 1500 1500
mitie engineering services west midlands ltd b ordinary shares of £1 each 1 1500 1500
mitie industrial cleaning north ltd b ordinary shares of £1 each 1 1750 1750
mitie landscape northern ltd b ordinary shares of £1 each 3 3300 3300
mitie security south west ltd b ordinary shares of £1 each 3 3200 3200
mitie services retail ltd b ordinary shares of £1 each 1 10000 10000
mitie transport services ltd c ordinary shares of £1 each 4 4500 4500
n n r goodman
mitie catering services ltd b ordinary shares of £1 each 8 8333 8333
on 24 august 2005 mitie group plc acquired the minority interest in mitie business services ltd including ruby mcgregorsmith’s holding
of 3500 b ordinary shares of 1p each the total maximum consideration payable to mrs mcgregorsmith is £88795 such consideration was
satisfied as to £1 in cash and as to £79916 by the issue of 48141 mitie group plc shares the balance of £8879 of the consideration is
deferred and will be paid in new mitie group plc shares by 30 september 2006 subject to the attainment of certain profit targets by mitie
business services ltd for the year ending 31 march 2006 
directors also had interests in share options as follows
options granted lapsed exercised o options exercise date expiry
outstanding during during during o outstanding price exercisable date
at the year the year the year a at p
1 april 2005 3 31 march 2006
r mcgregorsmith
i 22700 – – – 2 22700 132 9806 9813
ii 77300 – – – 7 77300 132 9806 9813
ii 100000 – – – 1 100000 127 12607 12614
ii – 100000 – – 1 100000 162 24608 24615 42 mitie group plc
directors’ remuneration report continued
the share options stated above were granted under the mitie
group plc executive share option scheme 2001 i granted
under the approved part of the scheme ii granted under the
unapproved part of the scheme
the performance criterion for the scheme that must be met
requires a percentage growth in the companys earnings per
share equal to or in excess of 100 per annum compound over
the period from the date of grant of the option to the date on
which the option first becomes exercisable the performance
criterion selected is no different for the director than for any other
member of the scheme
no payment was made for the grant of the options and there
have been no variations to the terms and conditions or
performance criterion for share options since the grant date
the market price of ordinary shares of 25p each at 31 march
2006 was 1915p and the highest and lowest prices during the
year were 211p and 1468p respectively
other than as stated above no other changes in directors’
interests have taken place since 1 april 2006 and no options have
been granted to any director since 1 april 2006
this report was approved by the board of directors and signed on
its behalf
i ishbel j s macpherson
chairman remuneration committee mitie group plc 43
the adoption of good corporate governance practice is essential
for ensuring the future growth and success of mitie group plc to
achieve this the board believes that corporate governance must
form an integral part of the operating activities of the business to
complement and enhance rather than stifle these activities 
in the board’s efforts to develop the group’s corporate
governance environment and to ensure an effective fit with 
the operating functions of the business a number of changes 
and enhancements have been made during the year ended 
31 march 2006 these include the appointment of two new
independent nonexecutive directors the appointment of a
dedicated head of corporate responsibility and a review of the
schedule of matters reserved for the board and its committees
terms of reference
this statement together with the directors’ remuneration report
explains the manner in which the board of mitie group plc has
applied the principles and provisions of good governance as set
out in the combined code and how the corporate
governance environment within the mitie group has developed
over the past year
t the board
board of directors
during the year the composition and structure of the board has
been reviewed as a part of this review ruby mcgregorsmith was
promoted to the newly created position of chief operating
officer on 9 september 2005 ruby mcgregorsmith relinquished
her role as group finance director on the appointment of
suzanne baxter to this position on 10 april 2006 in addition two
new independent nonexecutive directors have been appointed
ishbel macpherson on 28 july 2005 and david jenkins on 1 march
2006 manish chande left the board on 31 march 2006
specialist recruitment consultants were used to assist in the
recruitment of nonexecutive directors and the group finance
director in conjunction with other recommendations to the
nomination committee to ensure that the most appropriate
candidates were appointed following due consideration of all
individuals identified the nomination committee recommended
to the board the appointment of ishbel macpherson and david
jenkins both were recruited for their considerable business
experience and skill ishbel macpherson has over 20 years of
corporate finance experience and was head of uk emerging
companies corporate finance at dresdner kleinwort wasserstein
and david jenkins was a partner in deloitte  touche llp for over
30 years in their assurance and advisory division in london before
retiring in 2004 
at 31 march 2006 the board of mitie group plc comprised six
executive directors and five nonexecutive directors 
although the balance of executive and independent 
nonexecutive directors does not comply with provision a32 of
the combined code the board and nomination committee are
satisfied that the current structure and composition of the board
includes the necessary skills knowledge and experience to
manage the group and its affairs effectively 
d director independence
all nonexecutive directors are considered to meet the
independence criteria set out in the combined code all 
nonexecutive directors including the chairman are considered
independent of management and free from any material
business or other relationships that could interfere with the exercise
of their independent judgement 
in respect of the chairman the level of communication and
involvement he has with the executive directors and in the affairs
of mitie group not only serves to keep him abreast of current
business issues but also continues to provide the executive
directors with access to an independent opinion on daytoday
business decisions
d director responsibility
there is a clear division of responsibility between the chairman
and chief executive the chairman is responsible for running the
board thus ensuring amongst other things that the nonexecutive
directors contribute effectively that there are constructive
relations between executive and nonexecutive directors and
that the board is aware of communications with shareholders 
the chief executive is responsible for the running of the group in
accordance with the authority delegated by the board this
ensures that there is a balance of power and authority such that
no one individual has unfettered powers of decision 
the commitments outside the group of the executive directors are
shown on page 36 the board does not consider these additional
responsibilities to prejudice the directors’ abilities to carry out their
duties effectively details of the remuneration received from these
commitments are shown in the remuneration report on pages 
39 to 42 within the group to ensure that undue reliance is not
placed on a particular director or committee member no
individual director is chairman of more than one committee
b board responsibility
mitie group plc maintains a formal schedule of specific matters
reserved for the decision of the board this has been reviewed to
ensure it meets the changing needs of the group this schedule
includes
1 setting of the strategy and corporate objectives of the group
2 approval of business plans and budgets and monitoring of
performance against these
3 approval of material acquisitions disposals and startups of
companies or businesses
4 approval of contracts bids and tenders where the contract is
material by value or otherwise unusual in scope nature or risk
exposure
5 approval of the group’s interim report and annual report
and accounts and any announcements relating thereto
6 appointment and removal of the chairman directors and
company secretary
7 review of the group’s systems of internal control including
financial operational and compliance controls and risk
management systems
8 review of the group’s corporate governance arrangements 
9 approval of significant changes to the group’s corporate or
management structure and
10 establishment and review of board committees their
membership terms of reference and activities and approval
of their recommendations as appropriate
full details of the schedule of matters reserved for the board are
available on the group’s website wwwmitiecouk or from the
company secretary on request
b board meetings
wherever possible the directors are expected to attend all board
meetings and the agm during the year ended 31 march 2006
there were eight scheduled meetings 
directors’ attendance at scheduled board and committee
meetings audit remuneration and nomination is shown in the
following table
corporate governance 44 mitie group plc
corporate governance continued
director board audit remuneration nomination
number of meetings 
held in year 8 3 5 6
d c ord 8 3 5 6
i r stewart 8   
c s acheson 8   
n r goodman 8   
c s hale 6   
r mcgregorsmith 8   
w robson 7   
m j chande 
1
53 4 5
sir j s jennings 8 3 4 6
c mcalpine 7 3 4 
i j s macpherson 
2
5  
d s jenkins 
2
2  
1 m j chande stepped down from the committees on 30 march 2006 and
resigned from the board on 31 march 2006
2 i j s macpherson and d s jenkins have attended all meetings since
being appointed
there are various procedures in place to ensure that each
director is supplied with an agenda and sufficient supporting
papers for all meetings on a timely basis so that they are
appropriately briefed and able to properly discharge their duties
as and when necessary the information supplied to the board is
reviewed to ensure that it is of sufficient quality and that it meets
the board’s requirements
during the year the chairman also met with the other 
nonexecutive directors on several occasions usually prior to main
board meetings without the executive directors being present 
d director appointment rotation support and appraisal
each new director is inducted in a suitable manner dependent
upon their role the induction programme includes introductions 
to all the directors and members of senior management visits to
various sites if requested and a tailored pack of information
which includes amongst other things a copy of mitie group
plc’s memorandum and articles of association committee 
terms of reference and copies of recent board minutes and
supporting papers 
all new and existing directors are entitled to receive any training
they consider necessary to enable them to fulfil their
responsibilities effectively all directors are also entitled to seek
independent legal advice any associated costs are funded by
mitie group plc 
all directors are appointed by the board on the recommendation
of the nomination committee all new directors are subject to 
reelection by the shareholders at the first agm after their
appointment all directors have also been reappointed within 
a three year period as required by the company’s articles of
association the directors due for reelection at the next agm are
shown in the directors’ report 
none of the executive or nonexecutive directors has a service
contract with a notice period greater than twelve months these
service contracts are available for inspection at the company’s
registered office the head office and at the agm
board director performance appraisal is carried out through a
number of formal and informal processes the formal processes
include the completion of a detailed appraisal questionnaire
where all board directors are asked to comment on a number of
areas including various board committee and individual
performance factors the results of this exercise are reviewed and
considered by the chairman and discussed with individual
directors where necessary and in summary at a board meeting
where improvements in performance are required appropriate
action is taken executive director performance is also assessed
against agreed targets as part of the remuneration committee’s
annual review of executive director remuneration 
all directors have access to the advice and services of the
company secretary the company secretary is responsible for
ensuring that board procedures and applicable rules and
regulations are observed including advising on all governance
matters the company secretarial department provides
secretarial services to the board and all its committees 
t the committees
during the year the membership of the audit remuneration 
and nomination committees was reviewed following the
appointments of two new nonexecutive directors and manish
chande’s resignation from the board specific changes are
included below
e executive committee
the purpose of the executive committee is to assist the board and
chief executive with
• developing and implementing strategy operational plans
policies procedures and budgets
• the day to day management of the group
• monitoring operating and financial performance and
• assessing and controlling risk
the specific responsibilities of the executive committee are
formally set out in the committee’s terms of reference which 
are available from the company secretary on request
to assist the executive committee the management of each
support function submits reports in advance of each meeting
these reports cover amongst other things operational
performance health and safety finance corporate
responsibility marketing quality risk management and internal
audit human relations and strategic project activities 
to ensure that these matters are dealt with in the appropriate
manner and given sufficient attention eight executive committee
meetings were held during the year 
the executive committee’s current members include the
executive directors of mitie group plc the senior managers 
of each division are also invited to attend the meetings 
the committee is chaired by the chief operating officer 
a audit committee
the audit committee comprises four nonexecutive directors and
is chaired by cullum mcalpine on 31 march 2006 the audit
committee comprised david jenkins sir john jennings ishbel
macpherson and cullum mcalpine on 30 march 2006 both
manish chande and david ord ceased to be members of the
committee on the same date david jenkins and ishbel
macpherson became new members of the committee
the group’s external auditors normally attend the audit
committee meetings at the invitation of the committee 
the chief operating officer group finance director other 
senior managers and the manager of the internal audit and 
risk management department may also attend 
r report of the audit committee 
the committee met three times during the year the matters
considered at these meetings included 
• the group’s interim report and annual report and accounts
• critical accounting policies significant judgements and
changes in accounting policy
• a review and approval of the internal audit plan for the year
ending 31 march 2007
• the external auditors’ audit plan and yearend summary
memorandum
• the effectiveness of the external auditors
• the appropriateness of the going concern assumption
• presentations from senior management regarding matters
identified during the group’s internal audit and risk
management activities
• corporate governance matters arising under the combined
code and
• the methodology and effectiveness of the internal audit and
risk management department mitie group plc 45
during the year the audit committee has also been responsible
for monitoring the group’s procedures that allow employees to
communicate concerns in confidence about possible
improprieties of any nature around the group and the processes
in place to investigate and follow these up all communications
received have been investigated appropriately and none has
constituted a significant risk to the group
the committee is also responsible for considering the fees nature
and scope of work and independence and objectivity of the
group’s external auditors as well as their appointment re
appointment and removal as necessary this is done through a
number of formal and informal processes including regular
dialogue concerning such matters between the committee and
external auditors reports made to the committee by the auditors
and an assessment of the effectiveness of the auditors by the
committee once a year 
the committee met the external auditors during the year without
the presence of the executive directors 
the committee recognises that during the year there may be
occasions when the external auditors provide nonaudit services
to the group in such instances independence matters are given
careful consideration prior to such appointments in line with the
group’s policy on the provision of nonaudit services there are
additional controls in place within deloitte  touche llp regarding
the segregation and nature of the services provided to act as an
additional safeguard over independence an analysis of the fees
paid to the auditors is given in note 4
the board and audit committee are satisfied that at least one of
the audit committee members has recent and relevant financial
experience in addition and if necessary the committee is
authorised to obtain professional independent advice at the
group’s expense 
r remuneration committee
one of the primary purposes of the remuneration committee is to
assist the board in the development of an effective remuneration
framework for executive directors and senior management this
and the committee’s additional duties are formalised in the
committee’s terms of reference 
to help the committee fulfil its duties external remuneration
consultants new bridge street consultants llp were appointed
to undertake an independent review of mitie group plc’s
remuneration policy for its directors 
at the end of the year the members of the remuneration
committee were david jenkins sir john jennings ishbel
macpherson and cullum mcalpine on 30 march 2006 manish
chande and david ord ceased to be members of the
committee on the same day david jenkins and ishbel
macpherson became members of the committee ishbel
macpherson was appointed chairman
during the year there were five meetings
the directors’ remuneration report includes details of the
remuneration policy and of the remuneration of the directors
n nomination committee
the nomination committee is responsible for amongst other
things reviewing the balance and composition of the board
identifying and nominating for approval by the board appropriate
candidates to fill vacancies as they arise and considering
succession planning these and the committee’s additional
duties are formalised in its terms of reference 
the nomination committee comprised five nonexecutive
directors at 31 march 2006 david jenkins sir john jennings ishbel
macpherson cullum mcalpine and david ord it is chaired by sir
john jennings the senior independent nonexecutive director
on 30 march 2006 david jenkins ishbel macpherson and cullum
mcalpine became members of the committee manish chande
ceased to be a member on 30 march 2006 
during the year the committee held six meetings at which it
• considered matters of director succession planning 
• recommended specialist nonexecutive director and group
finance director recruitment agencies
• recommended to the board the appointment of two new
independent nonexecutive directors
• recommended to the board the appointment of a new chief
operating officer and
• recommended to the board the appointment of a new group
finance director
the terms of reference of the audit remuneration and
nomination committees are available on the group’s website
wwwmitiecouk or from the company secretary on request
s shareholder communications
the board of directors is committed to maintaining an ongoing
relationship with institutional and private shareholders through
regular disclosure the board recognises the importance of this
process and that shareholders must receive relevant high quality
information in a timely manner to facilitate this mitie’s website is
regularly updated with all announcements and presentations as
and when they are released the website also contains other
investorrelated information tailored to help enhance an investor’s
understanding of the group
the principal channels of communication between the board and
shareholders are meetings with institutional investors and analysts
after the release of the interim report and again after the release
of the annual report and accounts meetings are also held with
shareholders on request which are usually satisfied by the chief
executive the chief operating officer and the group finance
director the chairman and nonexecutive directors are given the
opportunity to meet institutional shareholders and they are
available to shareholders throughout the year if shareholders
request additional meetings any significant matters arising in
these meetings are fed back to the board as necessary by the
chief executive andor the chairman 
the group’s agm also provides shareholders with the opportunity
to meet and ask questions of the full board of directors both
institutional and private shareholders are welcomed at the agm 
i internal control and risk management
the board of mitie group plc is responsible for the group’s system
of internal control and the group’s risk management systems this
responsibility includes the requirement for the directors to regularly
review the operation and effectiveness of these systems mitie’s
system of internal control is designed to manage rather than
eliminate the risk of failure to achieve business objectives in
pursuing these objectives the system of internal control can only
provide reasonable and not absolute assurance against material
misstatement and loss
an annual review of the operation and effectiveness of the
internal control framework has been undertaken key elements of
the process used by the board to review the effectiveness of the
system of internal control include reviews of significant issues
arising from internal and external audits a review of the significant
risks reported in the group risk register and discussions with senior
management in addition a detailed report is submitted to the
board for review which collates various high level reports from 
key senior managers at group covering the high level control
environment in their particular area of specialism this report 
also includes an independent consideration of key aspects of 
the control environment by the internal audit and risk
management department 
the board confirms that there is a continuing process for
identifying evaluating and managing significant risks faced by
the group the board also confirms that this process has been in
place throughout the year under review and up to the date of
approval of the annual report and accounts these processes
are in accordance with the turnbull guidance issued by the
institute of chartered accountants in england and wales in 1999 46 mitie group plc
corporate governance continued
the following information provides further details of the 
key features of mitie’s system of internal control and risk
management systems
m mitie group culture and management framework
the board and senior management are responsible for
maintaining and developing a culture of integrity competence
fairness and responsibility throughout the group the board sets
the framework within which this culture flows down through the
organisation to the individual trading businesses who operate their
own systems of internal control 
in addition to the cultural framework established by the board and
senior management the group head office offers specialist
resource support including amongst others legal health and
safety quality it insurance human resources and finance 
the level of support offered is constantly under review and where
necessary has been enhanced during the year to help develop
and strengthen the group’s overall internal control environment all
the principal divisions in the group have a similar level of specialist
resource which works closely with the group specialists but which
is dedicated to the particular needs and circumstances of that
division these support structures help ensure synergy between the
group divisions and ultimately each subsidiary company
c communication
throughout the group there are systems in place for reporting key
performance and risk related information to the board and
executive committee alongside the reporting of operating results
against budget key operational performance indicators are also
continuously monitored by the executive directors and senior
management as described in the executive committee section 
of this statement 
to ensure effective communication reporting systems include
company divisional and regional meetings structures are in
place to ensure concerns and issues are communicated from the
bottom to the top of the group and vice versa an additional tool
used to aid communication in the group is the group’s intranet
which has been enhanced and relaunched during the year this
allows all employees throughout the group to access key
information about the group as well as group policies
procedures and guidelines 
i individual company controls
each operating company has authority to manage their 
business within delegated levels of authority and group 
policies procedures and guidelines these are set with the 
aim of balancing groupwide synergy and control with the
autonomy management requires to develop and manage 
the business successfully 
the board of each operating company is required to complete
an annual statement of internal control to do this each
company board needs to consider formally its own system of
internal control with specific reference to areas of judgement
compliance with regulatory and group requirements the
accuracy of its financial information and risks to its operations 
r risk management 
the group’s risk management framework has been enhanced
during the year to ensure it adapts to the dynamic and rapidly
growing structures and operations within the group further
enhancements will be undertaken over the coming year to ensure
that the group’s acquisitions also operate within this framework
and that the framework continues to provide the appropriate
level of information to management and the board
the current framework includes the completion review and
monitoring of risk reporting systems at an operating business level
these systems include consideration of particular risks how they
could impact upon the business and what mitie can do to
mitigate those risks similar processes are followed at both
divisional and group level to ensure that wider strategic risks are
considered so that this information is reported to the board in 
an effective manner risks are categorised to draw out the 
groupwide and high level risks this information is consolidated
into the group’s risk register and regularly reviewed by the 
mitie group plc board 
we categorise the risks identified into strategic financial
commercial compliance operational regulatory and reputation
related risks
the types of risk that are evaluated include 
• acquisition errors
• loss of market share
• availability of cash to meet business needs
• credit risks
• self insurance risk
• systems failure
• reputation risks
• customer price pressure
• contract dispute
• loss of key employees
• tupe risks
• major health and safety incident
• environmental incident
• shortage of skilled labour force
• various regulatorynoncompliance issues
• onerous contracts
each of the risks is analysed and a strategy is put in place to
minimise or mitigate the risk
p performance measurement
our approach to the measurement of our business performance 
is straightforward we look at a small number of financial key
performance indicators including growth in revenues both
organic and acquired net profit net profit margin and cash 
we measure success by how a business is growing the profitability
of each business unit and cash conversion 
the internal audit and risk management department also
undertakes an annual programme of riskfocused operational 
and financial reviews to consider the internal control environment
key areas of risk to the group and risk mitigating strategies
recommendations and conclusions are reported to the chief
executive chief operating officer group finance director and
both the executive and audit committee for their consideration
and action where necessary 
the effectiveness of the internal audit and risk management
department is reviewed by the audit committee the committee
does this by considering amongst other things reports submitted
to each committee meeting to update its members on its
activities detailed presentations to the committee are 
also made on request by this department covering various
aspects of the system of internal control and significant findings 
of reviews undertaken 
c compliance with the combined code
the board confirms that throughout the year ended 31 march 2006
the group has complied with the provisions set out in section 1 
of the combined code with the exception that the board has 
not consisted of at least an equal number of independent 
nonexecutive and executive directors  mitie group plc 47
independent auditors’ report to the members of mitie group plc
we have audited the group financial statements the “financial
statements” of mitie group plc for the year ended 31 march
2006 which comprise the consolidated income statement the
consolidated statement of recognised income and expenses
consolidated balance sheet the consolidated cash flow
statement and the related notes 1 to 32 these financial
statements have been prepared under the accounting policies
set out therein
we have reported separately on the individual company
financial statements of mitie group plc for the year ended 
31 march 2006
this report is made solely to the company’s members as a body
in accordance with section 235 of the companies act 1985 
our audit work has been undertaken so that we might state to 
the company’s members those matters we are required to state
to them in an auditors’ report and for no other purpose to the
fullest extent permitted by law we do not accept or assume
responsibility to anyone other than the company and the
company’s members as a body for our audit work for this report
or for the opinions we have formed
r respective responsibilities of directors and auditors
the directors’ responsibilities for preparing the annual report the
directors’ remuneration report and the group financial
statements in accordance with applicable united kingdom law
and international financial reporting standards ifrs as adopted
for use in the european union are set out in the statement of
directors’ responsibilities
our responsibility is to audit the group financial statements and
the part of the directors’ remuneration report described as
having been audited in accordance with relevant united
kingdom legal and regulatory requirements and international
standards on auditing uk and ireland
we report to you our opinion as to whether the financial
statements give a true and fair view in accordance with the
relevant framework and whether the financial statements have
been properly prepared in accordance with the companies act
1985 we also report on the consistency of the directors’ report
with the financial statements if we have not received all the
information and explanations we require for our audit or if
information specified by law regarding directors’ remuneration
and transactions with the company and other members of the
group is not disclosed
we also report to you if in our opinion the company has not
complied with any of the four directors’ remuneration disclosure
requirements specified for our review by the listing rules of the
financial services authority these comprise the amount of each
element in the remuneration package and information on share
options details of long term incentive schemes and money
purchase and defined benefit schemes we give a statement 
to the extent possible of details of any non compliance
we review whether the corporate governance statement reflects
the company’s compliance with the nine provisions of the july
2003 frc combined code specified for our review by the listing
rules of the financial services authority and we report if it does
not we are not required to consider whether the board’s
statements on internal control cover all risks and controls or form
an opinion on the effectiveness of the company’s corporate
governance procedures or its risk and control procedures
we read the directors’ report and other information contained 
in the annual report for the above year as described in the
contents section and consider the implications for our report if we
become aware of any apparent misstatements or material
inconsistencies with the individual company financial statements 
b basis of audit opinion
we conducted our audit in accordance with international
standards on auditing uk and ireland issued by the auditing
practices board an audit includes examination on a test basis 
of evidence relevant to the amounts and disclosures in the group
financial statements and the part of the directors’ remuneration
report described as having been audited it also includes an
assessment of the significant estimates and judgements made by
the directors in the preparation of the financial statements and of
whether the accounting 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 group financial statements and the part of the
directors’ remuneration report described as having been
audited 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 group financial statements
o opinion
in our opinion
• the financial statements give a true and fair view in
accordance with those international financial reporting
standards as adopted for use in the european union of the
state of the group’s affairs as at 31 march 2006 and of its profit
for the year then ended
• the financial statements and the part of the directors’
remuneration report described have been properly prepared
in accordance with the companies act 1985 and article 4 of
the ias regulation and
• the directors’ report is consistent with the financial statements
d deloitte  touche llp
chartered accountants and registered auditors 
bristol united kingdom
19 may 2006 48 mitie group plc
consolidated income statement
for the year ended 31 march 2006
2006 2005
notes £m £m
continuing operations
revenue 2 9356 7997
cost of sales 7570 6389
g gross profit 178 86 6 1608
other operating income – 15
other administrative expenses 1303 1165
amortisation of intangible assets 02 –
administration expenses  13 30 5  1165
profit from operations 34 48 81 1 458
profit from operations excluding other operating income 48 81 1 443
investment revenue 6 26 22
finance costs 7 02 01
p profit before tax 50 5 4 479
tax 8 155 139
profit for the year from continuing operations 35 50 0 340
discontinued operations
loss for the year from discontinued operations 24 38
p profit for the year 32 6 3 302
attributable to
equity holders of the parent 302 270
minority interest 24 32
3 32 6 3 302
earnings per share eps 
– basic 10 98 8p 88p
– diluted 10 9 97 7p 87p
e eps excluding discontinued operations
– basic 10 10 6p p 101p
– diluted 10 10 05 5p 100p mitie group plc 49
consolidated statement of recognised income and expense
for the year ended 31 march 2006
2006 2005
notes £m £m
actuarial gainslosses on defined benefit pension schemes 29 11 15
tax chargecredit on actuarial gainslosses taken directly to equity 23 26 02
n net expense recognised directly in equity 1 5  13
profit for the year 326 302
t total recognised income and expense for the year 31 1 2 289
attributable to
equity holders of the parent 287 257
minority interests 24 32 50 mitie group plc
consolidated balance sheet 
as at 31 march 2006
2006 2005
notes £m £m
noncurrent assets
goodwill 11 1438 527
other intangible assets 12 115 –
property plant and equipment 13 345 272
deferred tax assets 18 49 46
retirement benefit surplus 29 18 –
t total noncurrent assets 196 65 5 845
current assets
inventories 14 88 63
trade and other receivables 15 2443 1786
cash and cash equivalents 16 96 615
t total current assets 262 27 7 2464
total assets 45 59 2 3 3309
current liabilities
trade and other payables 19 2145 1599
current tax liabilities 76 74
provisions 21 117 –
obligations under finance leases 20 08 02
bank overdrafts and loans 17 330 –
t total current liabilities 26 67 6  1675
noncurrent liabilities
obligations under finance leases 20 10 08
retirement benefit obligation 29 – 76
provisions 21 102 92
deferred tax liabilities 18 47 02
t total noncurrent liabilities 15 59 9  178
total liabilities 28 83 5  1853
net assets 17 75 7 1 1456
equity
share capital 22 77 76
share premium account 23 137 115
merger reserve 23 520 441
revaluation reserve 23 02 02
capital redemption reserve 23 03 03
other reserve 23 03 06
share based payments reserve 23 14 07
retained earnings 23 901 714
e equity attributable to equity holders of the parent 165 53 3 1360
minority interests 104 96
t total equity 175 57 7 1456
the financial statements were approved by the board of directors and authorised for issue on 19 may 2006 they were signed on its behalf by
ian r stewart ruby mcgregorsmith suzanne baxter
chief executive chief operating officer group finance director mitie group plc 51
consolidated cash flow statement
for the year ended 31 march 2006
2006 2005
notes £m £m
net cash from operating activities 25 32 21 1 332
investing activities
interest received 25 23
purchase of property plant and equipment 138 140
purchase of subsidiary undertakings 855 02
disposals of property plant and equipment 26 32
disposal of subsidiary undertaking – 89
n net cash outflowinflow from investing activities 94 42 2 0 02
financing activities
repayments of obligations under finance leases 02 03
proceeds on issue of share capital 21 30
repayments of loans on purchase of subsidiary undertakings 116 –
new bank loans raised 310 –
share buybacks 16 149
equity dividends paid 113 91
minority dividends paid 02 01
n net cash inflowoutflow from financing 82 2 214
net decreaseincrease in cash and cash equivalents 5 53 9  120
net cash and cash equivalents at beginning of year 61 15 5 495
net cash and cash equivalents at end of year 7 6 6 615
net cash and cash equivalents comprises
cash at bank 96 615
overdraft 20 –
7 76 6 615 52 mitie group plc
notes to the consolidated financial statements
1 1 basis of preparation and significant accounting policies
basis of preparation
the group’s financial statements for the year ended 31 march 2006 are the first to be prepared in accordance with international financial
reporting standards ifrs as adopted for use in the european union 
details of the changes in accounting policies arising from the adoption of ifrs together with restated information for the year ended 
31 march 2005 have been provided in note 32 the accounting policies set out in that note have been consistently applied to all periods
presented in these financial statements with the exception of the impact of ias 32 and ias 39 concerning financial instruments in
accordance with ifrs 1 ‘first time adoption of international financial reporting standards’ the group has elected not to restate
comparative information for the impact of ias 32 and ias 39 and has only adopted these standards in the financial statements for the
year ended 31 march 2006 this adoption had no financial impact on the financial statements 
the following standards and interpretations have been issued but are not yet effective
• amendment to ias 1 ‘presentation of financial statements capital disclosures’
• amendment to ias 19 ‘actuarial gains and losses group plans and disclosures’
• amendment to ias 39 ‘the fair value option’
• amendment to ias 39 ‘cash flow hedge accounting of forecast intragroup transactions’
• amendment to ias 39 and ifrs 4 ‘financial guarantee contracts’
• issue of ifrs 7 ‘financial instruments disclosures’
• ifric 4 ‘determining whether an arrangement contains a lease’
the directors do not anticipate that the adoption of these standards and interpretations will have a material impact on the group’s
financial statements in the period of initial application
s significant accounting policies under ifrs
the significant accounting polices adopted in the preparation of the group’s ifrs financial information are set out below
b basis of consolidation
the consolidated financial statements comprise the financial statements of mitie group plc and all its subsidiaries the financial statements
of the parent company and subsidiaries are prepared in accordance with uk generally accepted accounting principles uk gaap
adjustments are made in the consolidated accounts to bring into line any dissimilar accounting policies that may exist between uk gaap
and ifrs
all intercompany balances and transactions including unrealised profits arising from intragroup transactions have been eliminated in full
subsidiaries are consolidated from the date on which control is transferred to the group and cease to be consolidated from the date on
which control is transferred out of the group 
b business combinations
the acquisition of subsidiaries is accounted for using the purchase method the cost of the acquisition is measured at the aggregate of the
fair values at the date of exchange of assets given liabilities incurred or assumed and equity instruments issued by the group in
exchange for control of the acquiree plus any costs directly attributable to the business combination the acquiree’s identifiable assets
liabilities and contingent liabilities that meet the conditions for recognition are recognised at their fair value at the acquisition date except
for noncurrent assets or disposal groups that are classified as held for resale in accordance with ifrs 5 ‘non current assets held for sale
and discontinued operations’ which are recognised and measured at fair value less costs to sell
goodwill arising on acquisition is recognised as an asset and initially measured at cost being the excess of the cost of the business
combination over the group’s interest in the net fair value of the identifiable assets liabilities and contingent liabilities recognised if after
reassessment the group’s interest in the net fair value of the acquiree’s identifiable assets liabilities and contingent liabilities exceeds the
cost of the business combination the excess is recognised immediately in profit or loss
the interest of minority shareholders in the acquiree is initially measured at the minority’s proportion of the net fair value of the assets
liabilities and contingent liabilities recognised
g goodwill
goodwill arising on consolidation represents the excess of the cost of acquisition over the group’s interest in the fair value of the
identifiable assets and liabilities of a subsidiary associate or jointly controlled entity at the date of acquisition cost of acquisition includes 
all deferred amounts that become payable in the future
goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated impairment losses it is reviewed
for impairment at least annually any impairment is recognised immediately in profit or loss and is not subsequently reversed
for the purpose of impairment testing goodwill is allocated to each of the group’s cashgenerating units expected to benefit from the
synergies of the combination cashgenerating units to which goodwill has been allocated are tested for impairment annually or more
frequently when there is an indication that the unit may be impaired if the recoverable amounts of the cashgenerating units is less than
the carrying amount of the unit the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit
and then to the other assets of the unit prorata on the basis of the carrying amount of each asset in the unit an impairment loss
recognised for goodwill is not reversed in the subsequent period
on disposal of a subsidiary associate or jointly controlled entity the attributable amount of goodwill is included in the determination of the
profit or loss on disposal
goodwill arising on acquisitions before the date of transition to ifrs has been retained at the previous uk gaap amounts subject to being
tested for impairment at that date goodwill written off to reserves under uk gaap prior to 1998 has not been reinstated and is not
included in determining any subsequent profit or loss on disposal mitie group plc 53
i intangible assets
intangible assets acquired separately are capitalised at cost intangible assets identified in a business acquisition are capitalised at fair value
as at the date of acquisition following initial recognition the carrying amount of an intangible asset is its cost less any accumulated
amortisation and any accumulated impairment losses amortisation expense is charged to administrative expenses in the income statement
on a straight line basis over it’s useful life
r revenue
revenue is recognised to the extent that it is probable that the economic benefits will flow to the group and the revenue can be reliably
measured other than in respect of longterm contracts described below revenue represents fee income recognised in respect of services
provided during the period stated net of value added tax
revenue is earned solely within the united kingdom
revenue from longterm contracts represents the sales value of work done in the year including fees invoiced and estimates in respect of
amounts to be invoiced after the year end profits are recognised on longterm contracts where the final outcome can be assessed with
reasonable certainty in calculating this the percentage of completion method is used based on the proportion of costs incurred to the total
estimated cost cost includes direct staff costs and outlays full provision is made for all known or anticipated losses on each contract
immediately such losses are forecast
gross amounts due from customers are stated at the proportion of the anticipated net sales value earned to date less amounts billed on
account to the extent that fees paid on account exceed the value of work performed they are included in creditors as gross amounts due
to customers
variations in contract work and claims are included to the extent that they have been agreed with the customer
revenue from bundled contracts consists of various components which operate independently of each other and for which reliable fair
values can be established accordingly each component is accounted for separately as if it were an individual contractual arrangement
interest income is accrued on a time basis by reference to the principal outstanding and at the effective interest rate applicable which 
is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net 
carrying amount
dividend income from investments is recognised when the shareholders’ rights to receive payment have been established
l leasing
finance leases which transfer to the group substantially all the risks and benefits incidental to ownership of the leased item are capitalised
at the inception of the lease at the fair value of the leased item or if lower at the present value of the minimum lease payments lease
payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on
the remaining balance of the liability finance charges are charged directly against income capitalised leased assets are depreciated over
the shorter of the estimated life of the asset or the lease term
leases where the lessor retains substantially all the risks and benefits of ownership of the asset are classified as operating leases operating
lease payments are recognised as an expense in the income statement on a straightline basis over the leaseterm any lease incentives are
amortised over the lesser of the life of the operating lease or to the first opportunity for termination
f foreign currency
transactions in foreign currencies are recorded at the rate of exchange at the date of transaction monetary assets and liabilities
denominated in foreign currencies at the balance sheet date are reported at the rates of exchange prevailing at that date 
nonmonetary items carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date when
the fair value was determined nonmonetary items that are measured in terms of historical cost in a foreign currency are not retranslated
exchange differences arising on the settlement of monetary items and on the retranslation of monetary items are included in profit or loss for
the period exchange differences arising on the retranslation of nonmonetary items carried at fair value are included in profit or loss for the
period except for differences arising on the retranslation of nonmonetary items in respect of which gains and losses are recognised directly 
in equity for such nonmonetary items any exchange component of that gain or loss is also recognised directly in equity
r retirement benefit costs
the group operates two defined benefit pension schemes the group also operates a fully insured defined contribution pension scheme the
assets of which are held in independently administered funds
payments to the defined contribution pension scheme are charged as an expense as they fall due
for the defined benefit pension schemes the cost of providing benefits is determined using the projected unit credit method with actuarial
valuations being carried out at each balance sheet date actuarial gains and losses are recognised in full in the period in which they occur
they are recognised outside profit or loss and presented in the statement of recognised income and expense
past service cost is recognised immediately to the extent that the benefits are already vested and otherwise is amortised on a straightline
basis over the average period until the benefits become vested
the retirement benefit obligation recognised in the balance sheet represents the present value of the defined benefit obligation as adjusted
for unrecognised past service cost and as reduced by the fair value of scheme assets any asset resulting from this calculation is limited to
past service cost plus the present value of available refunds and reductions in future contributions to the plan  taxation
the tax expense represents the sum of the tax currently payable and deferred tax
the tax currently payable is based on taxable profit for the year taxable profit differs from net profit as reported in the income statement
because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never
taxable or deductible the group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted 
by the balance sheet date
deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the
financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the balance
sheet liability method deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are
recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be
utilised such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition other than
in a business combination of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit
the carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable
that sufficient taxable profits will be available to allow all or part of the asset to be recovered
deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised
deferred tax is charged or credited in the income statement except when it relates to items charged or credited directly to equity in which
case the deferred tax is also dealt with in equity
deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities
and when they relate to income taxes levied by the same taxation authority and the group intends to settle its current tax assets and
liabilities on a net basis
p property plant and equipment
property plant and equipment is stated at cost less accumulated depreciation and any impairment in value depreciation is charged so as
to write off the cost of the assets over their estimated useful lives and is calculated on a straightline basis as follows
freehold buildings and long leasehold property – over 50 years
leasehold improvements – period of the lease
plant and equipment – 314 years
annually the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those
assets have suffered an impairment loss if any such indication exists the recoverable amount of the asset is estimated in order to determine
the extent of the impairment loss if any where the asset does not generate cash flows that are independent from other assets the group
estimates the recoverable amount of the cashgenerating unit to which the asset belongs 
recoverable amount is the higher of fair value less costs to sell and value in use in assessing value in use the estimated future cash flows are
discounted to their present value using a pretax discount rate that reflects current market assessments of the time value of money and the
risks specific to the asset for which the estimates of future cash flows have not been adjusted
if the recoverable amount of an asset or cashgenerating unit is estimated to be less than its carrying amount the carrying amount of the
asset cashgenerating unit is reduced to its recoverable amount an impairment loss is recognised as an expense immediately
where an impairment loss subsequently reverses the carrying amount of the asset cashgenerating unit is increased to the revised estimate
of its recoverable amount but so that the increased carrying amount does not exceed the carrying amount that would have been
determined had no impairment loss been recognised for the asset cashgenerating unit in prior years a reversal of an impairment loss is
recognised as income immediately
i inventories
inventories are stated at the lower of cost and net realisable value
costs represent materials direct labour and overheads incurred in bringing the inventories to their present condition and location net
realisable value is based on estimated selling price less further costs expected to be incurred to completion and estimated selling costs
provision is made for obsolete slow moving or defective items where appropriate
i investments
all investments are initially recorded at cost being the fair value of the consideration given and including acquisition charges associated with
the investment subsequently they are reviewed for impairment if events or changes in circumstances indicate the carrying value may not
be recoverable
54 mitie group plc
n notes to the consolidated financial statements continued financial instruments
trade receivables are measured at initial recognition at fair value appropriate allowances for estimated irrecoverable amounts are
recognised in the income statement where there is objective evidence that the asset is impaired
cash and cash equivalents comprise cash in hand and demand deposits and other shortterm highly liquid investments that are readily
convertible to a known amount of cash and are subject to an insignificant risk of changes in value
interest bearing bank loans and overdrafts are stated at the amount of the net proceeds after deduction of issue costs finance charges
including premiums payable on settlement or redemption and direct issue costs are accounted for on an accruals basis in the income
statement and are added to the carrying amount of the instrument to the extent that they are not settled in the period in which they arise
trade payables are measured at fair value
equity instruments issued by the company are recorded at the proceeds received net of direct issue costs
financial assets and financial liabilities are recognised on the group’s balance sheet when the group becomes a party to the contractual
provisions of the instrument
provisions
provisions are recognised when the group has a present obligation legal or constructive as a result of a past event and it is probable that
an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the
amount of the obligation where the group expects some or all of a provision to be reimbursed for example under an insurance contract
the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain the expense relating to any
provision is presented in the income statement net of any reimbursement if the effect of the time value of money is material provisions are
determined by discounting the expected future cash flows at a pretax rate that reflects current market assessments of the time value of
money and where appropriate the risks specific to the liability where discounting is used the increase in the provision due to the passage
of time is recognised as a borrowing cost
precontract costs
all bid costs are expensed through the income statement up to the point where contract award or full recovery of costs is virtually certain
bid costs incurred after this point are then capitalised within trade and other receivables on the contract award these bid costs are
amortised through the income statement over the contract period by reference to the stage of completion of the contract activity at the
balance sheet date
share based payments
the group operates a number of executive and employee share option schemes for all grants of share options and awards the fair value
as at the date of grant is calculated using the blackscholes model and the corresponding expense is recognised on a straightline basis over
the vesting period based on the group’s estimate of shares that will eventually vest
the group has taken advantage of the transitional provisions of ifrs 2 in respect of equitysettled awards and has applied ifrs 2 only to
equitysettled awards granted after 7 november 2002 that had not vested before 1 april 2005
2 revenue
2006 2005
£m £m
support services
cleaning 2047 1897
catering 136 135
landscaping 44 20
pest control 47 45
security 872 541
managed services 823 840
business services 168 187
engineering maintenance 1023 737
5 516 60 0 4402
property services 16 63 5 1 1291
engineering services 256 61 1 2304
total continuing operations 9356 7997
discontinued operations – 189
t total 935 56 6 8186
investment revenue 26 22
the revenue analysis provides additional disclosure regarding the three divisions of the group
mitie group plc 55 3 business and geographical segments
the group manages its business on a service division basis these divisions are the basis on which the group reports its primary 
segment information
business segments
for management purposes the group is currently organised into three operating divisions – support services property services and
engineering services 
principal activities are as follows
support services offers a flexible range of services supporting the occupiers of buildings this ranges from engineering maintenance and
facilities management to security
property services act as a main contractor improving buildings either by fitting them out refurbishing or maintaining them
engineering services is predominantly a mechanical and electrical services specialist installing heating lighting air conditioning and 
data cabling
the group was also previously involved in scaffolding operations that operation and segment was discontinued with effect from 
30 september 2004
segment information about these businesses is presented below 
support property engineering consolidated
services services services
2006 2006 2006 2006
2006 £m £m £m £m
revenue 51 16 0 1 163 35 5 25 56 1 9 935 56 6
result
segment result 328 89 64 4 48 1
unallocated corporate expenses ––––
o operating profit 32 8 8 89 9 6 4 4 48 1
investment income 17 01 08 2 26 6
finance costs 02 – –  0 2 
profit before tax 34 43 3 9 0 7 72 2 50 05 5
margin 6 6  5 5  2 8  5 4 
tax 1 15 5 
loss for the period from discontinued operations 2 24 4
p profit after tax and discontinued operations 32 6
s support property engineering consolidated
services services services
2006 2006 2006 2006 2006
other segment information £m £m £m £m
assets by segment
intangible assets 1383 54 116 1 155 53 3
assets 1402 658 979 3 303 39 9
total assets 27 78 5 7 71 2 1 109 95 5 45 59 2
l liabilities by segment
liabilities 1673 428 734  28 83 5 
total liabilities 1 167 73 3  42 28 8  73 34 4  28 83 5 
total net assets 11 11 2 2 28 4 3 36 1 1 175 57 7
capital expen nditure
tangible assets 100 21 17 1 13 8
depreciation charge 68 15 15 9 98 8
intangible assets 1015 – 13 1 102 28 8
intangible amortisation 02 – – 0 02 2
56 mitie group plc
notes to the consolidated financial statements continued mitie group plc 57
support property engineering discontinued unallocated consolidated
services services services operations corp porate profit
i
2005
2005 2005 2005 2005 2005
2005 £m £m £m £m £m £m
revenue 4402 1291 2304 189 – 8186
result
segment result 291 76 76 10 – 453
unallocated corporate profit –––– 15 15
operating profit 291 76 76 10 15 468
investment income 08 04 10 – – 22
finance costs 01 –––– 01
profit before tax 298 80 86 10 15 489
margin 68 62 37 53 – 60
tax 139
loss for the period from discontinued operations 48
profit after tax and discontinued operations 302
i relates to sale of a property
support property engineering consolidated
services services services
2005 2005 2005 2005 2005
other segment information £m £m £m £m
assets by segment
intangible assets 370 54 103 527
assets 1511 432 839 2782
total assets 1881 486 942 3309
liabilities by segment
liabilities 1037 229 587 1853
total liabilities 1037 229 587 1853
total net assets 844 257 355 1456
capital expenditure
tangible assets 122 13 15 150
depreciation charge 75 15 17 107
intangible assets –06 14 20
intangible amortisation – – – –
geographical segments
all group operations are located in the united kingdom the group considers all operations form part of that single geographical segment
4 profit from operations
profit from operations has been arrived at after chargingcrediting
2006 2005
£m £m
depreciation of property plant and equipment 98 107
amortisation of intangible assets included in other operating expenses 02 –
gain on disposal of property plant and equipment 06 18
staff costs see note 5 3919 3636
auditors’ remuneration for audit services see below 04 03 58 mitie group plc
notes to the consolidated financial statements continued
a more detailed analysis of auditors’ remuneration is provided below
2006 2005
£’000 £’000
audit services
statutory audit 339 279
further assurance services 67 –
tax services
advisory services 56 32
other services – 4
4 462 2 315
fees for further assurance services principally comprise ifrs opening balance sheet and related audit work
in addition to the amounts shown above the auditors received fees of £10300 2005 £9800 for the audit of the group pension schemes
£39000 2005 £nil of fees were incurred in relation to the acquisitions in the year and have been included in the acquisition costs
a description of the work of the audit committee is set out in the corporate governance statement on page 43 and includes an
explanation of how auditor objectivity and independence is safeguarded when nonaudit services are provided by the auditors
5 staff costs
2006 2005
no no
the average number of persons employed during the financial year was
support services 29298 27757
property services 1826 1420
engineering services 1297 1199
a average number of group employees 32 42 21 3 30376
details of directors’ remuneration and interests are provided in the directors’ remuneration report and the audited section should be
regarded as an integral part of this note
2006 2005
£m £m
employment costs
wages and salaries 3560 3327
social security costs 315 272
other pension costs 37 32
sharebased payments note 28 07 05
t total employment costs 391 19 9 3636
6 investment revenue
2006 2005
£m £m
interest on bank deposits 16 21
other interest receivable 10 01
i investment revenue 26 6 22
7 finance costs
2006 2005
£m £m
interest on bank overdrafts and loans 02 –
interest on obligations under finance leases – 01
t total finance costs 02 2 01 mitie group plc 59
8 tax
continuing operations discontinued operations total
2006 2005 2006 2005 2006 2005
£m £m £m £m £m £m
current tax 154 143 – 02 154 145
deferred tax note 18 01 04 – – 01 04
1 15 5 1 139 – 02 15 55 5 141
corporation tax is calculated at 300 2005 300 of the estimated assessable profit for the year
the charge for the year can be reconciled to the profit per the income statement as follows
2006 2005
£m £m
profit before tax
continuing operations 505 479
discontinued operations 24 36
tax at the uk corporation tax rate of 300 144 133
expenses not deductible for tax purposes 11 01
tax losses not recognised 07 05
goodwill – 16
loss on disposal of investment – 29
profit on disposal of property – 05
prior year adjustments 07 06
t tax charge for the year
continuing operations 15 5 1 139
discontinued operations – 02
in addition to the amount charged to the income statement deferred tax relating to retirement benefit costs sharebased payments and
shortterm timing differences amounting to £05m has been charged 2005 £04m credited directly to equity see note 18 the benefit of
tax savings relating to retirement benefit costs and sharebased payments amounting to £10m has been credited 2005 £01m charged
directly to equity
9 dividends
2006 2005
£m £m
amounts recognised as distributions to equity holders in the period
final dividend for the year ended 31 march 2005 of 18p 2004 14p per share 56 44
interim dividend for the year ended 31 march 2006 of 19p 2005 16p per share 59 48
1 11 5 9 92
proposed final dividend for the year ended 31 march 2006 of 24p 2005 18p per share 73 3 55
the proposed final dividend is subject to approval by shareholders at the annual general meeting and has not been included as a liability in
these financial statements 60 mitie group plc
notes to the consolidated financial statements continued
10 earnings per share
2006 2005
number of shares no m no m
weighted average number of ordinary shares for the purpose of basic eps 3059 3064
effect of dilutive potential ordinary shares share options 32 41
weighted average number of ordinary shares for the purpose of diluted eps 3091 3105
the calculation of the basic and diluted earnings per share is based on the following data
2 2006 per share 2005 per share
earnings amount earnings amount
£m £m
basic eps
net profit attributable to equity holders of the parent 302 98p 270 88p
add back loss for the period from discontinued operations 24 08p 38 13p
b basic earnings before discontinued activities 32 6 1 10 6p p 308 101p
diluted eps
earnings for the purpose of diluted eps 302 97p 270 87p
add back loss for the period from discontinued operations 24 08p 38 13p
d diluted earnings before discontinued activities 32 6 1 10 5p p 308 100p
eps from continuing operations preamortisation and other operating income
basic earnings before discontinued activities 326 106p 308 101p
add back amortisation of intangibles 02 00p ––
less other operating income – – 15 05p
p preamortisation and other operating income per ordinary share 32 8 1 10 6p p 293 96p
diluted eps preamortisation discontinued operations and other operating income 32 28 8 10 05 5p 2 293 95p mitie group plc 61
11 goodwill
£m
cost
at 1 april 2004 519
acquisition of minorities 20
disposal of subsidiaries 12
at 1 april 2005 527
acquisition of subsidiaries 746
increased consideration for subsidiaries acquired in prior years 90
acquisition of minorities 75
at 31 march 2006 1438
accumulated impairment losses
at 1 april 2004 –
at 1 april 2005 –
at 31 march 2006 –
carrying amount
at 31 march 2006 1438
at 31 march 2005 527
goodwill acquired in a business combination is allocated at acquisition to the cash generating units cgu that are expected to benefit from
that business combination goodwill has been allocated to cgus in the following business segments which is how goodwill is monitored by the
group internally
2006 2005
£m £m
cost
support services 1268 370
property services 54 54
engineering services 116 103
1 143 38 8 527
the group tests goodwill at least annually for impairment
the recoverable amounts of the cgus are determined from value in use calculations the key assumptions for the value in use calculations
are those regarding the discount rates growth rates and expected changes to selling prices and direct costs during the period
management estimates discount rates using pretax rates that reflect current market assessments of the time value of money and the risks
specific to the cgus the growth rates are based on industry growth forecasts changes in selling prices and direct costs are based on past
practices and expectations of future changes in the market
the group prepares cash flow forecasts derived from the most recent financial budgets approved by management for the next five years
and extrapolates cash flows for the following five years based on an estimated growth rate of 2 per cent this rate does not exceed the
average longterm growth rate for the relevant markets
the rates used to discount the forecast cash flows from cgus are as follows
2006 2005
 
support services 80 80
property services 80 80
engineering services 80 80 62 mitie group plc
n notes to the consolidated financial statements continued
12 other intangible assets
c customer
relationships
£m
cost
at 1 april 2004 and 1 april 2005 –
acquired on acquisition of subsidiaries 117
a at 31 march 2006 117
amortisation
at 1 april 2004 and 1 april 2005 –
charge for the year 02
a at 31 march 2006 02
carrying amount
at 31 march 2006 115
at 31 march 2005 –
customer relationships are amortised over the remaining period of the contract which ranges on average between 6 and 8 years
1 13 property plant and equipment
long
freehold leasehold plant and 
properties properties vehicles total
£m £m £m £m
c cost
at 1 april 2004 58 32 650 7 740
additions – – 150 1 150
disposals 11 – 357  368
at 1 april 2005 47 32 443 5 522
additions 08 15 115 1 138
acquisition of subsidiaries 14 04 35 5 53
disposals 09 – 71  80
at 31 march 2006 60 51 522 633
accumulated depreciation and impairment
at 1 april 2004 06 03 328 3 337
charge for the year 01 01 105 1 107
disposals 02 – 192  194
at 1 april 2005 05 04 241 2 250
charge for the year 01 04 93 9 98
disposals – – 60  60
at 31 march 2006 06 08 274 288
carrying amount
at 31 march 2006 54 43 248 345
at 31 march 2005 42 28 202 2 272
the net book value of plant and vehicles held under finance leases included above was £18m 2005 £10m mitie group plc 63
14 inventories
2006 2005
£m £m
workinprogress 80 63
payments received on account – 01
finished goods 08 01
8 88 8 63
15 trade and other receivables
2006 2005
£m £m
amounts receivable for the sale of services 2113 1567
amounts recoverable on contracts 179 121
other debtors 22 56
prepayments and accrued income 129 42
2 244 43 3 1786
the average credit period taken on sales of services was 76 days 2005 72 days interest is charged on overdue debts when appropriate 
an allowance has been made for estimated irrecoverable amounts from the sale of services of £39m 2005 £13m this allowance has been
determined by reference to past default experience
the directors consider that the carrying amount of trade and other receivables approximates their fair value
credit risk
the group’s principal financial assets are bank balances and cash and trade and other receivables
the group’s credit risk is primarily attributable to its trade receivables the amounts presented in the balance sheet are net of allowances 
for doubtful receivables an allowance for impairment is made where there is an identified loss event which based on previous experience 
is evidence of a reduction in the recoverability of the cash flows
the credit risk on liquid funds and financial instruments is limited because the counterparties are banks with high creditratings assigned by
international creditrating agencies
the group has no significant concentration of credit risk with exposure spread over a large number of counterparties and customers
16 cash and cash equivalents
cash and cash equivalents comprise cash held by the group and shortterm bank deposits with an original maturity of three months or less
the carrying amount of the assets approximates their fair value all balances are held in sterling
included in cash and cash equivalents are deposits totalling £96m 2005 £38m held by the group’s insurance subsidiary which are not
readily available for the general purposes of the group
17 bank overdraft and loans
the loans are repayable as follows
2006 2005
£m £m
overdraft 20 –
bank loans 310 –
3 33 0 –
all borrowings are in sterling the directors estimate that the carrying amount of the group’s borrowings approximate to their fair value 
the bank loans are repayable within one year and the overdrafts are repayable on demand
2 2006 2005
 
the weighted average interest rates paid during the period the loans were outstanding were as follows
overdraft 54 –
bank loans 51 –
at 31 march 2006 the group had available £70m 2005 £60m of undrawn borrowing facilities in respect of which all conditions precedent
had been met the facilities have various expiry dates between february 2008 and 2010 the loans carry interest rates which are currently
fixed at 51 the overdraft carries interest at 09 over base rate 64 mitie group plc
notes to the consolidated financial statements continued
18 deferred tax
the following are the major deferred tax liabilities and assets recognised by the group and movements thereon during the current and prior
reporting period
accelerated retirement intangible sharebased shortterm tax total
tax benefit assets – payments timing losses
d depreciation obligations business differences
combinations
£m £m £m £m £m £m £m
at 1 april 2004 08 21 – 03 06 02 24
chargecredit to income 06 – – 02 02 02 04
chargecredit to equity – 02 – 02 – – 04
disposal of subsidiary 12 ––––– 12
at 1 april 2005 10 23 – 07 04 – 44
chargecredit to income 02 02 – 02 01 02 01
chargecredit to equity – 26 – 04 17 – 05
charge to goodwill – – 36 – – – 36
as 31 march 2006 08 05 36 13 20 02 02
certain deferred tax assets and liabilities have been offset the following is the analysis of the deferred tax balances after offset for financial
reporting purposes
2006 2005
£m £m
deferred tax assets 49 46
deferred tax liabilities 47 02
n net deferred tax asset 02 2 44
the group has unutilised tax losses of £31m 2005 £16m that are available for offset against future profits deferred tax assets have not been
recognised in respect of £24m 2005 £16m of these losses as their recoverability is uncertain
19 trade and other payables
2006 2005
£m £m
payments received on account – 08
trade creditors 1334 973
other taxes and social security 407 287
other creditors 11 41
accruals and deferred income 393 290
2 214 45 5 1599
trade creditors and accruals principally comprise amounts outstanding for trade purchases and ongoing costs the average credit period
taken for trade purchases is 55 days 2005 56 days
the directors consider that the carrying amount of trade and other payables approximates to their fair value mitie group plc 65
20 obligations under finance leases
present value of 
minimum lease payments lease payments
2006 2005 2006 2005
£m £m £m £m
amounts payable under finance leases
within one year 08 02 07 02
in the second to fifth years inclusive 13 02 12 02
after five years – 07 – 05
2 21 1 11 1 9 0 09
less future finance charges 03 01 na na
p present value of lease obligations 18 8 10 1 9 0 09
less amount due for settlement within 12 months shown under current liabilities 08 02 07 02
a amount due for settlement after 12 months 10 0 08 1 2 0 07
the average remaining lease term is 22 months 2005 31 months for the year ended 31 march 2006 the average effective borrowing rate
was 51 2005 51 interest rates are fixed at the contract date all leases are on a fixed repayment basis and no arrangements have
been entered into for contingent rental payments 
all lease obligations are denominated in sterling
the fair value of the group’s lease obligations approximates their carrying amount
the group’s obligations under finance leases are secured by the lessors’ rights over the leased assets
21 provisions
contingent
deferred insurance
consideration reserve total
£m £m £m
at 1 april 2005 32 60 92
additional provision in the year 122 18 140
utilised during the year – 13 13
at 31 march 2006 154 65 219
included in current liabilities 117
included in noncurrent liabilities 102
219
contingent
deferred insurance
consideration reserve total
£m £m £m
at 1 april 2004 32 41 73
additional provision in the year –28 28
utilised during the year – 09 09
at 31 march 2005 32 60 92
included in current liabilities –
included in noncurrent liabilities 92
92
provision is made for contingent deferred consideration which will become payable in the future at the best estimate of the directors further
details are given in note 26
the provision for insurance claims represents amounts payable by mitie reinsurance company ltd in respect of outstanding claims incurred at
the balance sheet dates these amounts will become payable as each year’s claims are settled 66 mitie group plc
notes to the consolidated financial statements continued
22 share capital
ordinary ordinary
shares shares
of 25p of 25p
no £m
authorised at 1 april 2005 and 31 march 2006 34 40 00 00 00 00 8 85 5
2006
allotted and fully paid
at beginning of year 303173780 76
issued as directors’ remuneration 66773 –
issued for acquisitions 4832770 01
issued under share option schemes 1681551 –
own shares acquired 992305 –
a at end of year 308 87 762 25 569 9 7 7
2 2005
allotted and fully paid
at beginning of year 309393539 77
issued as directors’ remuneration 72812 –
issued for acquisitions 2560052 01
issued under share option schemes 1457383 01
own shares acquired 10310006 03
at end of year 303173780 76
during the year 66773 2005 72812 ordinary shares of 25p were allotted as remuneration in respect of services provided by directors at 
a market price of 1995p 2005 1620p giving rise to share premium of £01m 2005 £01m 
during the year 4832770 2005 2560052 ordinary shares of 25p were allotted in respect of acquiring minority interests at a midmarket
price of 1660p 2005 1290p giving rise to a merger reserve of £79m 2005 £32m
during the year 1681551 2005 1457383 ordinary shares of 25p were allotted in respect of share option schemes at a price between
5775p and 17625p 2005 850p and 1680p giving rise to share premium of £22m 2005 £16m
during the year 992305 2005 10310006 ordinary shares of 25p were purchased at market prices between 1585p and 1640p 
2005 1310p and 1650p these were then cancelled this resulted in a capital redemption reserve of £00m 2005 £03m mitie group plc 67
23 reserves
calledup share merger revaluation capital other share– retained total
share premium reserve reserve redemption reserve i based earnings
capital account reserve payment
reserve
£m £m £m £m £m £m £m £m £m
balance at 1 april 2005 76 115 441 02 03 06 07 714 1360
shares issued and net premium arising 
in respect of acquisitions 01 – 79 ––––– 8 80 0
shares issued and net premium in 
connection of exercise of share options – 22 – – – 03 – – 1 19 9
own shares acquired ––––––– 16  1 6 
profit for the period attributable to 
equity holders of the parent ––––––– 302 3 30 2
property revaluation –––––––– – –
dividend paid ––––––– 115  11 15 5
expense in relation to share based payments–––––– 07– 0 07 7
tax charge on items taken directly to equity ––––––– 31 3 31 1
net actuarial gain on defined
benefit pension schemes ––––––– 11 1 11 1
tax charge on actuarial gain 
taken directly to equity ––––––– 26  2 6 
net expense recognised directly in 
equity in the year ––––––– 15  1 5 
balance at 31 march 2006 7 7 1 13 7 5 52 0  0 2  0 3 0 03 3 1 4 9 90 1 1 165 53 3
calledup share merger revaluation capital other share– retained total
share premium reserve reserve redemption reserve i based earnings
capital account reserve payment
reserve
£m £m £m £m £m £m £m £m £m
balance at 1 april 2004 77 98 409 04 – 10 02 698 1290
shares issued and net premium arising 
in respect of acquisitions 01 – 32 ––––– 33
shares issued and net premium in 
connection of exercise of share options – 17 – – – 04 – – 13
own shares acquired 02 – – – 03 – – 147 146
profit for the period attributable to 
equity holders of the parent ––––––– 270 270
property revaluation – – – 02 – – – 02 –
dividend paid ––––––– 93 93
expense in relation to share based payments–––––– 05– 05
tax charge on items taken directly to equity ––––––– 01 01
net actuarial loss on defined
benefit pension schemes ––––––– 15 15
tax credit on actuarial loss 
taken directly to equity ––––––– 02 02
net expense recognised directly
in equity in the year ––––––– 13 13
balance at 31 march 2005 76 115 441 02 03 06 07 714 1360
i this is a nondistributable reserve 68 mitie group plc
notes to the consolidated financial statements continued
24 acquisition of subsidiaries
a purchase of minority interests
mitie air mitie air mitie mitie mitie mitie mitie total
conditioning conditioning business engineering engineer ring security security
wales west services services services north scotland 
ltd ltd ltd retail swa ansea ltd ltd
ltd ltd
£m £m £m £m £m £m £m £m
minority interest 01 01 11 01 02 02 01 1 19 9
goodwill 04 03 49 – 06 12 01 7 75 5
total purchase consideration 0 5 0 04 4 6 0 0 01 1 0 8 1 14 4 0 2 9 94 4
shares issued – mitie group plc 04 04 51 01 07 11 02 8 80 0
deferred consideration – – 07 – 01 01 – 0 09 9
cash consideration being 
cash outflow in the period 0 1 – – 0 2 – – – 0 02 2 – 0 05 5
b acquisition of intruder international ltd
on 3 may 2005 mitie acquired 100 of the issued share capital of intruder international ltd a provider of security services for total
consideration of £42m the transaction has been accounted for by the purchase method of accounting
book fair value fair 
value adjustments value
£m £m £m
net assets acquired
intangible assets 01 01 –
property plant and equipment 12 01 11
inventories 01 – 01
trade and other receivables 11 – 11
cash and cash equivalents 04 – 04
trade and other payables 08 – 08
current tax liabilities 01 – 01
provisions 08 02 10
obligations under finance leases 01 – 01
n net assets acquired 11 1 0 04 4 0 07 7
goodwill 35
t total consideration 42 2
satisfied by
cash 40
directly attributable costs 02
n net cash outflow arising on acquisition
cash consideration 42
cash and cash equivalents acquired 04
n net cash outflow 38 8
the goodwill arising on the acquisition of intruder international ltd is attributable to the expected profitability arising from new business and
the anticipated future operating synergies arising from assimilation into the group  
intruder international ltd contributed £39m to revenue and a loss of £04m to the group’s profit before tax for the period between the date
of acquisition and the balance sheet date mitie group plc 69
c acquisition of the watch security ltd
on 30 june 2005 mitie acquired 100 of the issued share capital of the watch security ltd a provider of security services for total
consideration of £82m the transaction has been accounted for by the purchase method of accounting
book fair value fair 
value adjustments value
£m £m £m
net assets acquired
intangible assets –08 08
deferred tax liability – 02 02
property plant and equipment 08 – 08
inventories 01 – 01
trade and other receivables 18 – 18
cash and cash equivalents 11 – 11
trade and other payables 24 – 24
current tax liabilities 01 – 01
loans 01 – 01
n net assets acquired 12 2 0 6 1 18 8
goodwill 64
t total consideration 82 2
satisfied by
cash 60
deferred consideration 20
directly attributable costs 02
t total consideration 82 2
net cash outflow arising on acquisition
cash consideration 62
cash and cash equivalents acquired 11
n net cash outflow 51 1
the goodwill arising on the acquisition of the watch security ltd is attributable to the expected profitability arising from new business and the
anticipated future operating synergies arising from assimilation into the group 
the company contributed £135m to revenue and £03m to the group’s profit before tax for the period between the date of acquisition and
the balance sheet date
d acquisition of lyndhurst services ltd
on 17 february 2006 mitie acquired 100 of the issued share capital of lyndhurst services ltd a provider of landscaping services for total
consideration of £89m the transaction has been accounted for by the purchase method of accounting 
book fair value fair 
value adjustments value
£m £m £m
net assets acquired
intangible assets –35 35
deferred tax liability – 10 10
property plant and equipment 08 01 07
inventories 01 – 01
trade and other receivables 14 – 14
cash and cash equivalents 03 – 03
trade and other payables 05 – 05
current tax liabilities 05 – 05
n net assets acquired 16 6 2 4 4 40 0
goodwill 49
t total consideration 89 9
satisfied by
cash 82
deferred consideration 06
directly attributable costs 01
t total consideration 89 9
net cash outflow arising on acquisition
cash consideration 83
cash and cash equivalents acquired 03
n net cash outflow 80 0 70 mitie group plc
notes to the consolidated financial statements continued
the goodwill arising on the acquisition of lyndhurst services ltd is attributable to the expected profitability arising from new business and the
anticipated future operating synergies arising from assimilation into the group 
the company contributed £07m to revenue and £01m to the group’s profit before tax for the period between the date of acquisition and
the balance sheet date
e acquisition of initial security ltd
on 7 march 2006 mitie acquired 100 of the issued share capital of initial security ltd a provider of security services for total consideration of
£597m the transaction has been accounted for by the purchase method of accounting 
book fair value fair 
value adjustments value
£m £m £m
net assets acquired
intangible assets 105 30 75
deferred tax liability – 23 23
property plant and equipment 28 – 28
inventories 05 05 –
trade and other receivables 349 10 339
overdrafts 84 – 84
trade and other payables 208 – 208
current tax liabilities 02 – 02
loans 116 – 116
obligations under finance leases 10 – 10
n net assetsliabilities acquired 67 7 6 68 8  0 1 
goodwill 598
t total consideration 59 7
s satisfied by
cash 591
directly attributable costs 06
t total consideration 59 7
n net cash outflow arising on acquisition
cash consideration 597
overdrafts 84
loans repaid 116
n net cash outflow 79 7
the goodwill arising on the acquisition of initial security ltd is attributable to the expected profitability arising from new business and the
anticipated future operating synergies arising from assimilation into the group
the company contributed £61m to revenue and £02m to the group’s profit before tax for the period between the date of acquisition and
the balance sheet date
a all acquisitions
the fair values on the acquisitions above are provisional as they are based upon the group’s estimate of recoverability of debtors and 
other assets
if all of the acquisitions had been completed on 1 april 2005 instead of the dates above total group revenue for the period would have been
approximately £1069m and profit before tax and amortisation for the year would have been approximately £546m on a pro forma basis mitie group plc 71
25 notes to the cashflow statement
2006 2005
reconciliation of operating profit to net cash from operating activities £m £m
operating profit from continuing operations 481 456
operating profit from discontinued operations 24 10
adjustments for
sharebased payment expense 07 05
depreciation of property plant and equipment 98 107
amortisation of intangible assets 02 –
gain on disposal of property plant and equipment 06 18
increasedecrease in provisions 05 19
o operating cash flows before movements in working capital 56 3 5 579
pension charge 26 23
pension contributions 32 34
increasedecrease in inventories 22 07
decrease in receivables 295 266
increase in payables 312 158
c cash generated by operations 55 2 4 467
additional pension contributions 78 –
income taxes paid 151 135
interest paid 02 –
n net cash from operating activities 32 1 3 332
additions to fixtures and equipment during the year amounting to £01m 2005 £10m were financed by new finance leases 
cash and cash equivalents which are presented as a single class of assets on the face of the balance sheet comprise cash at bank and
other shortterm highly liquid investments with a maturity of three months or less
26 contingent liabilities 
the company is party with other group companies to cross guarantees of each other’s bank loans and overdrafts of £33m 2005 £nil
the company and various of its subsidiaries are from time to time parties to legal proceedings and claims that are in the ordinary course of
business the directors do not anticipate that the outcome of these proceedings and claims either individually or in aggregate will have a
material adverse effect on the group’s financial position
included in provisions for liabilities and charges note 21 is £154m 2005 £32m of contingent consideration relating to the acquisitions of
trident safeguards ltd ‘trident’ eagle pest control services uk ltd ‘eagle’ lyndhurst services ltd ‘lyndhurst’ and the watch security ltd
‘the watch’ for trident £108m 2005 £20m is payable at any time between 2006 and 2010 if an agreed profit threshold is met in total
£92m 2005 £92m has been paid up to 31 march 2006 for eagle £12m 2005 £12m is payable at any time between 2008 and 2013 if 
an agreed profit threshold is met if this profit threshold is exceeded then an additional amount will become payable with the total
consideration capped at £60m in total  £28m has been paid up to 31 march 2006 2005 £28m for lyndhurst a further £06m is payable 
in july 2007 if an agreed profit threshold is exceeded with the total consideration capped at £90m in total £79m has been paid up to 
31 march 2006 for the watch a further £20m is payable in june 2007 dependent upon a number of performance conditions being met 
in total £60m has been paid up to 31 march 2006
contingent consideration to be satisfied in shares for the acquisition of minority interests in subsidiary undertakings is dependent on future
profits of those subsidiaries and is at the discretion of the company it is therefore not possible to quantify accurately in advance the final
amounts that may become payable
in connection with the sale of the platform company uk ltd formerly mitie powered access ltd in the year to 31 march 2004 the group
has guaranteed lease commitments amounting to £nil 2005 £01m against these guarantees the group has received indemnities from the
group’s bankers of £nil 2005 £00m and from the suppliers of the leased equipment of £nil 2005 £00m giving a net contingent liability of
£nil 2005 £01m
in addition the group and subsidiaries have given indemnities in respect of performance guarantees amounting to £61m 2005 £41m 72 mitie group plc
notes to the consolidated financial statements continued
27 operating lease arrangements
the group as lessee
2006 2005
£m £m
minimum lease payments under operating leases recognised in income for the year 4 5 4 44
at the balance sheet date the group had outstanding commitments for future minimum lease payments under noncancellable operating
leases which fall due as follows
2006 2005
£m £m
within one year 10 07
in the second to fifth years inclusive 29 29
after five years 13 14
5 52 2 50
28 sharebased payments
equitysettled share option scheme
the company has four share option schemes
the mitie group plc 1991 executive share option scheme
the executive share option scheme is open to all employees the exercise price is equal to the market value of the shares on the date of
grant the vesting period is three years if the options remain unexercised after a period of ten years from the date of grant the options
expire options may be forfeited if the employee leaves the group no options have been granted under this scheme since august 2001
the mitie group plc 2001 executive share option scheme
the executive share option scheme is open to all employees the exercise price is equal to the market value of the shares on the date of grant
the vesting period is three years if the options remain unexercised after a period of ten years from the date of grant the options expire options
may be forfeited if the employee leaves the group before options can be exercised the performance condition that must be satisfied is that
the percentage growth in the earnings per share over a three year period must be equal or greater than 100 per annum compound 
the mitie group plc 1991 and 2001 savings related share option scheme
the savings related share option scheme is open to all employees the exercise price is not less than 800 of the market value of the shares
on the day preceding the date on which invitations to participate in the scheme are issued the vesting period is five years if the options
remain unexercised after a period of five years and six months from the date of grant the options expire options maybe forfeited if the
employee leaves the group
details of the share options outstanding during the year are as follows
2006 2005
weighted weighted
average average
number of exercise number of exercise
share price share price
options in p options in p
outstanding at beginning of period 1 12089064 124 11572984 118
granted during the period 3278927 149 3526467 136
forfeited during the period 1406688 150 1553004 132
exercised during the period 1681551 138 1457383 150
outstanding at the end of the period 1 12 27 79 75 52 1 130 0 12089064 124
exercisable at the end of the period 2 09 98 69 98 1 124 4 2785100 121
the group recognised the following expenses related to sharebased payments
2006 2005
£m £m
2001 executive share options 04 03
2001 saye 03 02
0 07 7 05
1 included within this balance are 3719291 2005 5503845 options that have not been recognised in accordance with ifrs 2 as the
options were granted on or before 7 november 2002 these options have not been subsequently modified and therefore do not need to be
accounted for in accordance with ifrs 2 mitie group plc 73
the weighted average share price at the date of exercise for share options exercised during the period was 181p 2005 150p the options
outstanding at 31 march 2006 had a weighted average exercise price of 130p 2005 126p and a weighted average remaining contractual
life of 518 years 2005 435 years in the year ended 31 march 2006 options were granted on 23 june 2005 and 20 july 2005 in respect of the
executive and savings related share option schemes respectively the aggregate of the estimated fair values of the options granted on those
dates is £11m in the year ended 31 march 2005 options were granted on 11 june 2004 and 28 july 2004 in respect of the executive and
savings related share option schemes respectively the aggregate of the estimated fair values of the options granted on those dates is £11m
the fair value of options granted under the scheme is measured by use of the blackscholes model the inputs into the blackscholes model 
are as follows
2006 2005
share price p 98–161 98–130
exercise price p 99–162 99–139
expected volatility  28–30 28–30
expected life years 5–6 5–6
riskfree rate  417–512 417–517
expected dividends  143–212 143–212
expected volatility was based upon the historical volatility over the expected life of the schemes the expected life is based upon historical
data and has been adjusted based on management’s best estimates for the effects of nontransferability exercise restrictions and 
behavioural considerations
2 29 retirement benefit schemes
defined contribution scheme
the group operates a defined contribution retirement benefit scheme for all qualifying employees the assets of the scheme are held
separately from those of the group in funds controlled by the scheme providers 
the total cost charged to income of £11m 2005 £09m represents contributions payable to this scheme by the group at rates specified in
the rules of the plans as at 31 march 2006 contributions of £01m 2005 £01m due in respect of the current reporting period had not been
paid over to the schemes
defined benefit schemes
the group operates two defined benefit pension schemes called the mitie group plc pension scheme and the mitie group plc passport
pension scheme in addition the group contributes to the executive group limited shared cost section of the railway pension scheme
the assets of the mitie schemes are held separately from the group being invested in equities and with insurance companies contributions
to the schemes are charged to the income statement so as to spread the cost of pensions over the employees’ working lives with the group 
under the schemes the employees are entitled to retirement benefits varying between 0 and 66 per cent of final salary on attainment of a
retirement age of 65 no other postretirement benefits are provided the schemes are funded schemes
the most recent actuarial valuations of plan assets and the present value of the defined benefit obligation were carried out at 1 april 2006 by
mr david higgs fellow of the institute of actuaries the present values of the defined benefit obligation the related current service cost and
past service cost were measured using the projected unit credit method
valuation at
2006 2005
key assumptions used for ias 19 valuation
discount rate 510 550
expected return on scheme assets
equities 800 775
bonds 500 550
others 500 550
property 750 750
expected rate of salary increases 375 300
future pension increases 300 300
amounts recognised in administrative expenses in respect of these defined benefit schemes are as follows
2 2006 2005
£m £m
current service cost 30 25
interest cost 32 26
expected return on scheme assets 36 28
t total 2 6  23
the actual return on scheme assets was £128m 2005 £51m 74 mitie group plc
notes to the consolidated financial statements continued
the amount included in the balance sheet arising from the group’s obligations in respect of its defined benefit retirement benefit schemes is
as follows
2006 2005
£m £m
present value of defined benefit obligations 722 566
fair value of scheme assets 740 490
s surplusdeficit in scheme 18 8 76
deferred tax assetliability 05 23
a assetliability recognised in the balance sheet 13 3 53
movements in the present value of defined benefit obligations were as follows
2006 2005
£m £m
at 1 april 566 459
service cost 30 25
interest cost 32 26
contributions from scheme members 22 22
actuarial gains and losses 82 38
benefits paid 10 04
a at 31 march 72 2 5 566
movements in the fair value of scheme assets were as follows
2006 2005
£m £m
at 1 april 491 388
expected return on scheme assets 36 28
actuarial gains and losses 93 22
contributions from the sponsoring companies 110 34
contributions from scheme members 21 22
benefits paid 11 04
a at 31 march 74 0 4 490
the analysis of the scheme assets and the expected rate of return at the balance sheet date was as follows
expected return fair value of assets
2006 2005 2006 2005
  £m £m
equity instruments 800 775 466 341
debt instruments 500 550 28 18
property 750 750 34 28
other assets 500 550 212 103
7 74 0 4 490
the overall expected return on assets is calculated as the weighted average of the expected return of each asset class the expected return
on the equities is the sum of inflation the dividend yield economic growth and investment expenses the return on gilts and bonds is the
current market yield on longterm bonds the expected return on property has been set equal to that expected on equities less a margin 
the expected return on other assets is the rate earned by the scheme on cash mitie group plc 75
post retirement mortality
the mortality is based upon up to date tables which project mortality improvements in the future
for a male aged 65 years the expected life is 851 years 2005 840 years and for a female aged 65 years the expected life is 880 years 
2005 869 years
the history of experience adjustments is as follows
2006 2005
£m £m
present value of defined benefit obligations 722 566
fair value of scheme assets 740 490
surplusdeficit in the scheme 18 76
experience adjustments on scheme liabilities 
amount £ 82 37
percentage of scheme liabilities  114 70
experience adjustments on scheme assets 
amount £ 93 23
percentage of scheme liabilities  126 50
the estimated amounts of contributions expected to be paid to the scheme during the current financial year is £32m
3 30 related party transactions
transactions between the company and its subsidiaries which are related parties have been eliminated on consolidation and are not
disclosed in this note
during the year the group received interest of £nil 2005 £10000 on loan notes with the platform company holdings limited a company
in which c s acheson held a directorship in addition this company paid rent to the group of £36000 2005 £36000 no fees were paid by
the platform company holdings limited in respect of the services provided by c s acheson either to mitie or c s acheson 2005 £nil 
no balances were outstanding at the year end 2005 £nil
during the year the group provided services amounting to £164000 2005 £139000 to the bristol port company ltd a company in which 
d c ord held a directorship at the end of the year the amount owed to the group was £14000 2005 £12000
during the year the group provided services amounting to £7951000 2005 £700000 to sir robert mcalpine ltd a company in which 
c mcalpine held a directorship at the end of the year the amount owed to the group was £1602000 2005 £292000 
during the year i r stewart paid £1000 2005 £8000 to the group and subsidiary undertakings in respect of goods and services in the
ordinary course of business no balances were outstanding at the year end 2005 £nil
during the year the group earned interest of £140000 2005 £85000 on loan notes and loans with generation uk ltd a company in
which i r stewart held a directorship in addition the company paid rent to the group of £120000 2005 £90000 £nil was outstanding at
the year end 2005 £72000 no fees were paid by generation uk limited in respect of the services provided by i r stewart either to mitie
or i r stewart 2005 £nil
no material contract or arrangement has been entered into during the year nor existed at the end of the year in which a director had a
material interest 76 mitie group plc
notes to the consolidated financial statements continued
31 subsidiaries
the companies set out below are those which were part of the group at 31 march 2006 and in the opinion of the directors significantly
affected the group’s results and net assets during the year
at 31 march
2006
 ordinary  of voting
shares owned power held
cleaning
mitie cleaning  support services ltd 
1 2
9589 9589
mitie cleaning ltd 
1 2
9589 9589
mitie cleaning services ltd 
2
9589 9589
mitie industrial cleaning north ltd 5900 5900
mitie services retail ltd 
2
5720 5720
mitie transport services ltd 
2
8608 8608
c catering
mitie catering services london ltd 6060 6060
mitie catering services northern ltd 6500 6500
mitie catering services ltd 5111 5111
l landscape  pest control
eagle pest control services uk ltd 10000 10000
lyndhurst services ltd 10000 10000
mitie landscape northern ltd 
2
5639 5639
mitie landscape southern ltd 
2
7280 7280
s security
intruder international ltd 10000 10000
mitie aviation security ltd 
1
10000 10000
mitie security north ltd 
2
10000 10000
mitie security scotland ltd 
2
10000 10000
mitie security south west ltd 5100 5100
mitie security 2006 ltd 10000 10000
mitie security ltd 10000 10000
mitie trident security ltd 10000 10000
the watch security ltd 10000 10000
m managed services
mitie business services ltd 10000 10000
mitie managed services ltd 10000 10000
mitie document solutions ltd 6700 6700
mitie managed services southern ltd 10000 10000
mitie managed services south west and wales ltd 6893 6893
mitie pfi ltd 10000 10000
e engineering maintenance
mitie engineering maintenance caledonia ltd 5700 5700
mitie engineering maintenance north ltd 5100 5100
mitie engineering maintenance south west ltd 5383 5383
mitie engineering maintenance ltd 10000 10000 mitie group plc 77
at 31 march
2006
 ordinary  of voting
shares owned power held
engineering
mitie air conditioning london ltd 6741 6741
mitie air conditioning midlands ltd 8915 8915
mitie air conditioning north ltd 10000 10000
mitie air conditioning scotland ltd 7000 7000
mitie air conditioning south west ltd 10000 10000
mitie air conditioning wales ltd 9000 9000
mitie air conditioning west ltd 10000 10000
mitie engineering ltd 6820 6820
mitie engineering projects ltd 6300 6300
mitie engineering services bristol ltd 10000 10000
mitie engineering services cardiff ltd 10000 10000
mitie engineering services eastern ltd 10000 10000
mitie engineering services edinburgh ltd 5400 5400
mitie engineering services guernsey ltd 10000 10000
mitie engineering services jersey ltd 10000 10000
mitie engineering services leeds ltd 9142 9142
mitie engineering services liverpool ltd 5400 5400
mitie engineering services midlands ltd 5450 5450
mitie engineering services north east ltd 6614 6614
mitie engineering services north ltd 10000 10000
mitie engineering services peninsula ltd 10000 10000
mitie engineering services retail ltd 9625 9625
mitie engineering services scotland ltd 10000 10000
mitie engineering services se region ltd 10000 10000
mitie engineering services south west ltd 10000 10000
mitie engineering services swansea ltd 10000 10000
mitie engineering services west midlands ltd 6200 6200
mitie engineering services ltd 10000 10000
mitie environmental ltd 5198 5198
mitie scotgate ltd 
1
5199 5199
mitie technology ltd 5336 5336
p property services
mitie flooring southern ltd 6847 6847
mitie interiors ltd 5400 5400
mitie mccartney fire protection ltd 7516 7516
mitie property services eastern ltd 6800 6800
mitie property services uk ltd 10000 10000
mitie property services ltd 10000 10000
mitie spaceworks ltd 6500 6500
a administration
cole motors ltd 10000 10000
mitie property investments ltd 10000 10000
mitie reinsurance company ltd 10000 10000
n notes
1 shareholdings held by intermediate subsidiary undertakings
2 denotes company operates 13 fourweekly period
all companies were incorporated in and operate within the united kingdom except for mitie reinsurance company ltd and mitie
engineering services guernsey ltd which are registered and operate in guernsey and mitie engineering services jersey ltd which is
registered and operates in jersey
certain companies as noted in the table above operate on the basis of 13 fourweekly periods and have drawn up their accounts to 
1 april 2006 adjustments have been made on consolidation to exclude the results of these companies for the period from 31 march 2006 
to that date
the group has a 330 interest in an associate company service management international ltd as this is not considered material separate
disclosure of its results assets or liabilities have not been included in the financial statements
the companies listed above represent the principal operating subsidiary companies of the group a full list of subsidiary companies will be
annexed to the next annual return 32 explanation of transition to ifrs
this is the first year that the company has presented its financial statements under ifrs the following disclosures are required in the year 
of transition the last financial statements under uk gaap were for the year ended 31 march 2005 and the date of transition to ifrs was
therefore 1 april 2004
k key ifrs adjustments and their impact on the financial statements
ifrs 2 – sharebased payments
under ifrs 2 share awards must be measured at fair value at grant date and should be recognised as an expense to operating profit on a
straightline basis over the vesting period no expense was required under uk gaap
the group has valued all share option awards granted since 7 november 2002 a date specified in ifrs 2 that vest after the effective date
of ifrs 2 on 1 april 2004 the group has used the blackscholes model for the valuations
the impact is to reduce the group’s reported operating profit by £05m for the year ended 31 march 2005 related deferred tax assets
amounting to £03m at 1 april 2004 and £07m at 31 march 2005 have been recognised and will be released when the share options vest
and are exercised
i ifrs 3 – business combinations
under ifrs 3 goodwill is no longer amortised and instead is assessed annually for impairment goodwill arising on acquisitions before 
1 april 2004 will not be restated
as a result of this change the group’s operating profit will be increased by the goodwill previously amortised under uk gaap for the year
to 31 march 2005 this was £28m 
in the year ended 31 march 2005 the loss on disposal of mitie generation ltd included £50m of goodwill which arose on acquisition prior
to frs 10 goodwill and which had previously been written off in reserves under ifrs this goodwill remains written off in reserves and is not
included in the loss on sale the loss on sale of mitie generation ltd has been adjusted to £38m
i ias 10 – events after the balance sheet date
under ias 10 dividends proposed after the balance sheet date are not recognised as a liability at the balance sheet date dividends are
therefore recorded in the group’s financial statements in the period in which they are authorised
dividends proposed but not approved at the balance sheet date have been reversed from the financial statements this increased the 
net assets of the group by £45m at 1 april 2004 
i ias 12 – income taxes
due to the changes required in respect of pension liabilities and sharebased payments additional deferred tax on these adjustments has
been recognised in full
i ias 19 – employee benefits
the key impact on the group will be accounting for retirement benefits for defined benefit pension schemes the group has previously
accounted for these schemes using ssap 24 and in accordance with the transition rules under frs 17
the adoption of ias 19 does not result in a significant change to operating profit the impact on the group’s balance sheet at 1 april 2004
was to recognise a pension liability of £71m equal to the deficit in the defined benefit pension schemes the net impact is to reduce
shareholders’ equity by £50m after deferred tax
78 mitie group plc
n notes to the consolidated financial statements continued mitie group plc 79
r reconciliation of equity at 1 april 2004 date of transition to ifrs
uk gaap ifrs adjustments ifrs
ifrs 2 ias 10 ias 12 ias 19
share based dividends deferred pensions
payment ts tax
£m £m £m £m £m £m
n noncurrent assets
goodwill 519 – – – – 5 519
property plant and equipment 403 – – – – 4 403
deferred tax assets 00 – – 03 21 2 24
total noncurrent assets 922 – – 03 21 946
current assets
inventories 71 – – – – 7 71
trade and other receivables 1519 – – – – 1 1519
cash and cash equivalents 495 – – – – 4 495
total current assets 2085 – – – – 2085
total assets 3007 – – 03 21 3031
current liabilities
trade and other payables 1463 – – – –  1463
tax liabilities 65 – – – –  65
obligations under finance lease 01 – – – –  01
proposed dividend 45 – 45 – – – –
total current liabilities 1574 – 45 – – 1529
net current assets 511 – 45 – – 556
non current liabilities
deferred tax liabilities 01 – – – –  01
longterm provisions 74 – – – –  74
pension scheme reserve – – – – –  71
total noncurrent liabilities 75 – – – 71 146
total liabilities 1649 – 45 – 71 1675
net t assets 1358 – 45 03 50 1356
equity
share capital 77 – – – – 7 77
share premium account 98 – – – – 9 98
merger reserve 409 – – – – 4 409
revaluation reserves 04 – – – –  04
capital redemption reserve – – – – – – –
other reserve 10 – – – – 1 10
retained earnings 702 02 45 03 21 7 769
share based payment reserve – 02 – – – 0 02
pension scheme reserve – – – – 71  71
equity attributable to equity holders of the parent 1292 – 45 03 50 1290
minority interest 66 – – – – 6 66
total equity 1358 – 45 03 50 1356 80 mitie group plc
r reconciliation of equity at 31 march 2005 date of last uk gaap statements
uk gaap ifrs adjustments ifrs
ifrs 2 ifrs 3 ias 10 ias 12 ias 19
sharebased business dividends deferred pe ensions
payments combinations tax
£m £m £m £m £m £m £m
n non current assets
goodwill 499 – 28 – – – 5 527
property plant and equipment 272 – –––– 2 272
deferred tax assets – 02 – – 05 23 3 30
total noncurrent assets 771 02 28 – 05 23 829
current assets
inventories 63 – –––– 6 63
trade and other receivables 1800 – –––– 1 1800
cash and cash equivalents 615 – –––– 6 615
total current assets 2478 – – – – – 2478
total assets 3249 02 28 – 05 23 3307
current liabilities
trade and other payables 1599 – ––––  1599
tax liabilities 74 – ––––  74
obligations under finance lease 02 – ––––  02
proposed dividend 56 – – 56 – – – –
total current liabilities 1731 – – 56 – – 1675
net current assets 747 – – 56 – – 803
noncurrent liabilities
retirement benefit obligation – – – – – 76  76
deferred tax liabilities 08 – ––––  08
longterm provisions 92 – ––––  92
total noncurrent liabilities 100 – – – – 76 176
total liabilities 1831 – – 56 – 76 1851
n net assets 1418 02 28 56 05 53 1456
equity
share capital 76 – –––– 7 76
share premium account 115 – –––– 1 115
merger reserve 441 – –––– 4 441
revaluation reserves 02 – ––––  02
capital redemption reserve 03 – –––– 0 03
other reserve 06 – –––– 0 06
sharebased payment reserve – 07 –––– 0 07
retained earnings 683 05 28 56 05 53 7 714
equity attributable to equity holders of the parent 1322 02 28 56 05 53 1360
minority interest 96 – –––– 9 96
total equity 1418 02 28 56 05 53 1456
notes to the consolidated financial statements continued mitie group plc 81
r reconciliation of profit for the year ended 31 march 2005
uk gaap ifrs adjustments ifrs
ifrs 2 ifrs 3 ias 12 ias 19
sharebased business deferred pensions
payment ts combinations tax
£m £m £m £m £m £m
c continuing operations
revenue 7997 – – – – 7 7997
cost of sales 6389 – – – –  6389
gross profit 1608 – – – – 1608
other operating income 15 – – – – 1 15
administration expenses 1199 05 28 – 09  1167
profit from operations 424 05 28 – 09 456
investment income 21 –  – – 2 21
finance income – –  – 02 0 02
profit before tax 445 05 28 – 11 479
tax 141 02  – –  139
profit for the year from continuing operations 304 03 28 – 11 340
discontinued operations
loss for the period from discontinued operations 88 – 50 – –  38
profit for the period 216 03 78 – 11 302
attributable to
equity holders of the parent 184 03 78 – 11 2 270
minority interest 32 –  – – 3 32
216 03 78 – 11 302
earnings per share
basic 60p 8 88p
diluted 59p 8 87p
earnings per share before discontinued operations
basic 91p 1 101p
diluted 90p 1 100p
the amount shown above as the loss for the period from discontinued operations on a uk gaap basis is calculated as follows
£ £m
revenue 189
cost of sales 126
g gross profit 63
administration expenses 53
p profit before tax 10
tax 02
p profit for the period from discontinued operations 08
exceptional loss on sale of discontinued operations 96
l loss for the period from discontinued operations 88 82 mitie group plc
independent auditors’ report to the members of mitie group plc
we have audited the individual company financial statements
the “financial statements” of mitie group plc for the year ended
31 march 2006 which comprise the balance sheet and the related
notes 33 to 44 these financial statements have been prepared
under the accounting policies set out therein
we have reported separately on the group financial statements
of mitie group plc for the year ended 31 march 2006
this report is made solely to the company’s members as a body
in accordance with section 235 of the companies act 1985 our
audit work has been undertaken so that we might state to the
company’s members those matters we are required to state to
them in an auditors’ report and for no other purpose to the fullest
extent permitted by law we do not accept or assume responsibility
to anyone other than the company and the company’s
members as a body for our audit work for this report or for the
opinions we have formed
r respective responsibilities of directors and auditors
the directors’ responsibilities for preparing the annual report 
the directors’ remuneration report and the individual company
financial statements in accordance with applicable united
kingdom law and united kingdom generally accepted
accounting practice are set out in the statement of 
directors’ responsibilities
our responsibility is to audit the individual company financial
statements in accordance with relevant united kingdom legal
and regulatory requirements and international standards on
auditing uk and ireland
we report to you our opinion as to whether the individual financial
statements give a true and fair view in accordance with the
relevant framework and whether the individual financial
statements have been properly prepared in accordance with the
companies act 1985 we report to you on the consistency of the
directors’ report with the financial statements if the company has
not kept proper accounting records if we have not received all
the information and explanations we require for our audit or if
information specified by law regarding directors’ remuneration
and transactions with the company is not disclosed
we read the directors’ report and other information contained in
the annual report for the above year as described in the
contents section and consider the implications for our report if we
become aware of any apparent misstatements or material
inconsistencies with the individual company financial statements
b basis of audit opinion
we conducted our audit in accordance with international
standards on auditing uk and ireland issued by the auditing
practices board an audit includes examination on a test basis of
evidence relevant to the amounts and disclosures in the individual
company financial statements it also includes an assessment of
the significant estimates and judgements made by the directors 
in the preparation of the individual company financial
statements and of whether the accounting policies are
appropriate to the company’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 individual company 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
individual company financial statements
o opinion
in our opinion
• the individual company financial statements give a true and fair
view in accordance with united kingdom generally accepted
accounting practice of the state of the companys affairs as at
31 march 2006
• the individual company financial statements have been
properly prepared in accordance with the companies act
1985 and
• the directors’ report is consistent with the financial statements
d deloitte  touche llp
chartered accountants and registered auditors 
bristol united kingdom
19 may 2006 company balance sheet
as at 31 march 2006
2006 2005
notes £m £m
fixed assets
tangible assets 36 17 12
investments in subsidiary undertakings 37 2082 1083
t total fixed assets 209 99 9 1095
current assets
debtors 38 336 149
cash and cash equivalents – 55
t total current assets 33 6 2 204
total assets 243 35 5 1299
creditors amounts falling due within one year
trade and other payables 39 1071 189
provisions 40 122 –
t total creditors amounts falling due within one year 11 19 3  189
total assets less current liabilities 12 24 2 1 1110
creditors amounts falling due within one year
provisions 40 32 32
total liabilities 1 122 25 5  221
net assets 121 10 0 1078
equity
share capital 41 77 76
share premium account 42 137 115
merger reserve 42 520 441
capital redemption reserve 42 03 03
profit and loss account 42 473 443
e equity shareholders’ funds 121 10 0 1078
the financial statements were approved by the board of directors and authorised for issue on 19 may 2006 they were signed on its behalf by
ian r stewart ruby mcgregorsmith suzanne baxter
chief executive chief operating officer group finance director
mitie group plc 83 84 mitie group plc
3 33 significant accounting policies
basis of accounting
the separate financial statements of the company are presented as required by the companies act 1985 they have been prepared
under the historical cost convention and in accordance with applicable united kingdom accounting standards and law 
the principal accounting policies are summarised below they have been applied consistently throughout the year and the 
preceding year
p prior year comparatives
other than the change in accounting policies noted below the accounting policies have been applied consistently throughout the year
and the previous year the company adopted frs 17 ‘retirement benefits’ frs 20 ‘sharebased payment’ frs 21 ‘events after the
balance sheet date’ frs 25 ‘financial instruments disclosure and presentation’ and frs 26 ‘financial instruments measurement’ 
the effect of adopting frs 21 is set out in note 42 below the adoption of frs 20 has had no material effect on the accounts the adoption
of frs 17 frs 25 and frs 26 has not had any effect on the accounts
i investments
fixed asset investments in subsidiaries are shown at cost less any provision for impairment
t tangible fixed assets
tangible fixed assets are stated at cost less accumulated depreciation and any impairment in value depreciation is charged so as to write
off the cost of the assets over their estimated useful lives and is calculated on a straightline basis as follows
plant and vehicles – 314 years
the carrying values of tangible fixed assets are reviewed for impairment when events or changes in circumstances indicate the carrying
value may not be recoverable if any such indication exists and where the carrying values exceed the estimated recoverable amount the
assets or cashgenerating units are written down to their recoverable amount the recoverable amount of tangible fixed assets is the
greater of net selling price and value in use in assessing value in use the estimated future cash flows are discounted to their present value
using a pretax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset
p provisions
provisions are recognised when the company has a present obligation as a result of a past event and it is probable that an outflow of
resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of
the obligation where the company expects some or all of a provision to be reimbursed for example under an insurance contract the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain the expense relating to any provision
is charged to the profit and loss account net of any reimbursement if the effect of the time value of money is material provisions are
determined by discounting the expected future cash flows at a pretax rate that reflects current market assessments of the time value of
money and where appropriate the risks specific to the liability where discounting is used the increase in the provision due to the passage
of time is recognised as a borrowing cost
t taxation
current tax is provided at amounts expected to be paid or recovered using the tax rates and laws that have been enacted or
substantially enacted at the balance sheet date
deferred tax is provided in full on timing differences that result in an obligation at the balance sheet date to pay more tax or a right to pay
less tax at a future date at rates expected to apply when they crystallise based on current tax rates and law timing differences arise from
the inclusion of items of income and expenditure in tax computations in periods different from those in which they are included in the
financial statements deferred tax is not provided on timing differences arising from the revaluation of fixed assets where there is no
commitment to sell the asset or on unremitted earnings of subsidiaries and associates where there is no commitment to remit these
earnings deferred tax assets are recognised to the extent that it is regarded as more likely than not that they will be recovered deferred
tax assets and liabilities are not discounted
f financial instruments
trade receivables are measured at initial recognition at fair value appropriate allowances for estimated irrecoverable amounts are
recognised in the income statement where there is objective evidence that the asset is impaired
cash and cash equivalents comprise cash on hand and demand deposits and other shortterm highly liquid investments that are readily
convertible to a known amount of cash and are subject to an insignificant risk of changes in value
interest bearing bank loans and overdrafts are recorded at the proceeds received net of direct issue costs finance charges including
premiums payable on settlement or redemption and direct issue costs are accounted for on an accruals basis in the income statement
and are added to the carrying amount of the instrument to the extent that they are not settled in the period in which they arise
trade payables are measured at fair value
equity instruments issued by the company are recorded at the proceeds received net of direct issue costs
financial assets and financial liabilities are recognised on the company’s balance sheet when the company becomes a party to the
contractual provisions of the instrument
s sharebased payments
the company operates a number of executive and employee share option schemes for all grants of share options and awards the fair
value as at the date of grant is calculated using the blackscholes model and the corresponding expense is recognised on a straight line
basis over the vesting period
notes to the company financial statements mitie group plc 85
pensions 
pensions costs represent amounts paid to one of the group’s pension schemes for the purposes of frs 17 ‘retirement benefits’ the
company has been unable to identify its share of the underlying assets and liabilities of the main group defined benefit pension scheme on
a consistent and reasonable basis therefore the company is accounting for contributions to the scheme as if it were a defined contribution
scheme note 29 to the consolidated financial statements set out the details of the ias 19 ‘employee benefits’ net pension asset of £18m
2005 deficit £76m 
34 profit for the year
as permitted by section 230 of the companies act 1985 the company has elected not to present its own profit and loss account for the year
mitie group plc reported a loss after taxation for the financial year ended 31 march 2006 of £92m 2005 profit £252m
the auditors’ remuneration for audit services to the company was £23000 2005 £4000
the average number of persons employed being full time equivalents by the company during the year including directors was 68 2005 60
the costs incurred in respect of these employees were
2006 2005
£m £m
wages and salaries 53 53
social security costs 06 06
pension costs 03 02
6 62 2 61
detailed disclosures of directors’ remuneration and share options are given in the audited section of the directors’ remuneration report
contained in the consolidated financial statements
35 dividends
2006 2005
£m £m
amounts recognised as distributions to equity holders in the period
final dividend for the year ended 31 march 2005 of 18p 2004 14p per share 56 44
interim dividend for the year ended 31 march 2006 of 19p 2005 16p per share 57 47
1 11 3 9 91
proposed final dividend for the year ended 31 march 2006 of 24p 2005 18p per share 73 3 55
the proposed final dividend is subject to approval by shareholders at the annual general meeting and has not been included as a liability in
these financial statements
36 tangible fixed assets
plant  vehicles
£m
cost
at 1 april 2005 22
additions 10
disposals 02
at 31 march 2006 30
accumulated depreciation
at 1 april 2005 10
charge for the year 04
eliminated on disposals 01
at 31 march 2006 13
carrying amount
at 31 march 2006 17
at 31 march 2005 12 86 mitie group plc
37 investments in subsidiary undertakings
£m
shares at cost
at 1 april 2005 1199
additions 999
at 31 march 2006 2198
provision for impairment
at 1 april 2005 116
at 31 march 2006 116
carrying amount
at 31 march 2006 2082
at 31 march 2005 1083
full details of the acquisitions in the year are provided in note 24 of the consolidated financial statements and a listing of subsidiaries 
in note 31
38 debtors
2006 2005
£m £m
amounts owed by subsidiary undertakings 26 61 1 104
other debtors 4 4 26
prepayments and accrued income 1 12 2 09
corporation tax 1 9 10
3 33 6 1 149
39 creditors amounts falling due within one year
2006 2005
£m £m
trade creditors 10 0 06
amounts owed to subsidiary undertakings 11 17 7 157
bank overdrafts 60 07 7 –
bank loans 31 10 0 –
other taxes and social security 1 0 09
other creditors – – 01
accruals and deferred income 1 7 16
1 107 71 1 189
the company’s bank overdrafts are part of the group’s banking arrangements and are offset against credit balances within the group 
the company has adequate liquidity to discharge all current obligations
40 provisions
contingent deferred consideration
£m
at 1 april 2005 32
additional provision in the year 122
at 31 march 2006 154
included in current liabilities 122
included in noncurrent liabilities 32
154
provision is made for contingent deferred consideration which will become payable in the future at the best estimate of the directors
notes to the company financial statements continued mitie group plc 87
41 share capital
ordinary shares ordinary shares
of 25p of 25p 
no £m
authorised at 1 april 2005 and 31 march 2006 34 40 00 00 00 00 8 85 5
2006
allotted and fully paid
at beginning of year 303173780 76
issued as directors’ remuneration 66773 
issued for acquisitions 4832770 01
issued under share option schemes 1681551 
own shares acquired 992305 
a at end of year 308 87 762 25 569 9 7 7
2 2005
allotted and fully paid
at beginning of year 309393539 77
issued as directors’ remuneration 72812 –
issued for acquisitions 2560052 01
issued under share option schemes 1457383 01
own shares acquired 10310006 03
at end of year 303173780 76
during the year 66773 2005 72812 ordinary shares of 25p were allotted as remuneration in respect of services provided by directors at 
a market price of 1995p 2005 1620p giving rise to share premium of £01m 2005 £01m 
during the year 4832770 2005 2560052 ordinary shares of 25p were allotted in respect of acquiring minority interests at a midmarket
price of 1660p 2005 1290p giving rise to a merger reserve of £79m 2005 £32m 
during the year 1681551 2005 1457383 ordinary shares of 25p were allotted in respect of share option schemes at a price between
5775p and 17625p 2005 850p and 1680p giving rise to share premium of £22m 2005 £16m
during the year 992305 2005 10310006 ordinary shares of 25p were purchased at market prices between 1585p and 1640p 
2005 1310p and 1650p these were then cancelled this resulted in a capital redemption reserve of £00m 2005 £03m
42 reserves
calledup share merger capital retained total
share premium reserve redemption earnings
capital account reserve e
£m £m £m £m £m £m
at beginning of year as reported 76 115 441 03 638 1 127 73 3
prior year adjustment i –––– 195  19 95 5
a at beginning of year as restated 76 6 11 15 5 44 41 1 0 3 4 44 3 1 107 78 8
shares issued and net premium
arising in respect of acquisitions 01 – 79 – – 8 80 0
shares issued and net premium in 
connection of exercise of share options – 22 – – – 2 22 2
own shares acquired –––– 16  1 6 
loss for the period –––– 92  9 2 
dividend paid to shareholders –––– 113  11 13 3
dividends received from subsidiaries –––– 251 2 25 1
b balance at 31 march 2006 77 7 13 37 7 52 20 0 0 3 4 47 3 1 121 10 0
notes
i as required by the adoption of frs 21 ‘events after the balance sheet date’ dividends declared after the balance sheet date but 
before the accounts are authorised for issue are not recognised as an assetliability at the balance sheet date the prior period impact 
is to recognise the final dividends receivedpaid for the year ended 31 march 2004 and make no provision for the final dividends
receivedpaid for the year ended 31 march 2005 the result is a £195m decrease in reported net assets 88 mitie group plc
4 43 contingent liabilities 
the company is party with other group companies to cross guarantees of each other’s bank loans and overdrafts of £330m 2005 £nil
the company and various of its subsidiaries are from time to time parties to legal proceedings and claims that are in the ordinary course
of business the directors do not anticipate that the outcome of these proceedings and claims either individually or in aggregate will
have a material adverse effect on the company’s financial position
included in provisions for liabilities and charges note 40 is £154m 2005 £32m of contingent consideration relating to the acquisitions of
trident safeguards ltd ‘trident’ eagle pest control services uk ltd ‘eagle’ lyndhurst services ltd ‘lyndhurst’ and the watch security
ltd ‘the watch’ for trident £108m 2005 £20m is payable at any time between 2006 and 2010 if an agreed profit threshold is met 
in total £92m 2005 £92m has been paid up to 31 march 2006 for eagle £12m 2005 £12m is payable at any time between 2008 and
2013 if an agreed profit threshold is met if this profit threshold is exceeded then an additional amount will become payable with the total
consideration capped at £60m in total £28m has been paid up to 31 march 2006 2005 £28m for lyndhurst a further £06m is payable
in july 2007 if an agreed profit threshold is exceeded with the total consideration capped at £90m for the watch a further 
£20m is payable in june 2007 dependant upon a number of performance conditions being met in total £60m has been paid up to 
31 march 2006
contingent consideration to be satisfied in shares for the acquisition of minority interests in subsidiary undertakings is dependent on future
profits of those subsidiaries and is at the discretion of the company it is therefore not possible to quantify accurately in advance the final
amounts that may become payable
in connection with the sale of the platform company holdings ltd formerly mitie powered access ltd in the year to 31 march 2004 
the group has guaranteed lease commitments amounting to £nil 2005 £01m against these guarantees the group has received
indemnities from the group’s bankers of £nil 2005 £00m and from the suppliers of the leased equipment of £nil 2005 £00m giving 
a net contingent liability of £nil 2005 £01m
in addition the group and subsidiaries have given indemnities in respect of performance guarantees amounting to £61m 2005 £41m
4 44 related parties
directors’ transactions
details of related party transactions has been given in note 30 to the consolidated financial statements
the company has taken advantage of the exemption in frs 8 not to disclose transactions with companies within the group
notes to the company financial statements continued mitie group plc 89
n notice of annual general meeting
notice is hereby given that the seventieth annual general meeting of mitie group plc will be held at the merchants’ hall the promenade
clifton down bristol bs8 3nh on thursday 27 july 2006 at 12 noon for the following purposes
o ordinary business
to consider and if thought fit pass the following resolutions which will be proposed as ordinary resolutions
1 that the accounts for the year ended 31 march 2006 and the reports of the directors and auditors thereon be received
2 that the directors’ remuneration report for the year ended 31 march 2006 contained in the accounts be approved
3 that a final dividend for the year ended 31 march 2006 of 24p per ordinary share of 25p each be declared
4 that colin stewart acheson be reelected as a director
5 that david charles ord be reelected as a director
6 that ruby mcgregorsmith be reelected as a director
7 that cullum mcalpine be reelected as a director
8 that ishbel jean stewart macpherson be elected as a director
9 that david stannard jenkins be elected as a director
10 that suzanne claire baxter be elected as a director
11 that deloitte  touche llp be reappointed as auditors of the company until the conclusion of the next general meeting before which
accounts are laid and that their remuneration be determined by the directors
s special business
to consider and if thought fit pass the following resolution which will be proposed as an ordinary resolution
12 that the directors be generally and unconditionally authorised pursuant to section 80 of the companies act 1985 to exercise all the
powers of the company to allot relevant securities up to an aggregate nominal amount of £780110 in substitution for any existing
authority conferred on the directors under the said section 80 provided that this authority shall expire 15 months after the date of the
passing of this resolution or at the conclusion of the next annual general meeting of the company whichever comes first save that the
company may before such expiry make an offer or agreement which would or might require relevant securities to be allotted after such
expiry and the directors may allot relevant securities in pursuance of such offer or agreement as if the authority conferred hereby had 
not expired
to consider and if thought fit pass the following resolutions which will be proposed as special resolutions
13 that the directors be generally empowered pursuant to section 95 of the companies act 1985 to allot equity securities within the
meaning of section 94 of the said act for cash as if subsection 1 of section 89 of the said act did not apply to any such allotment
provided that this power shall be limited
a to the allotment of equity securities in connection with a rights issue in favour of the holders of ordinary shares of 25p each where the
equity securities respectively attributable of the interests of all such shareholders are proportionate as nearly as may be to the
respective number of ordinary shares held by them but subject to such exclusions or other arrangements as the directors may deem
necessary or expedient to deal with any legal or practical problems under the laws of any overseas territory or the requirements of
any regulatory body or any stock exchange in any territory or in relation to fractional entitlements and 
b to the allotment otherwise than pursuant to subparagraph a above of equity securities up to an aggregate nominal value of
£385750 approximately 5 of the issued share capital and this authority shall expire 15 months after the date of the passing of this
resolution or at the conclusion of the next annual general meeting of the company whichever comes first save that the company
may before such expiry make an offer or agreement that would or might require equity securities to be allotted after such expiry and
the directors may allot equity securities in pursuance of such offer or agreement as if the power conferred hereby had not expired
14 that the company be generally and unconditionally authorised to make market purchases within the meaning of section 1633 of the
companies act 1985 of ordinary shares of 25p each in the company on such terms and in such manner as the board of directors of
the company may from time to time determine provided that
a the maximum number of ordinary shares that may be purchased is 30860000 approximately 10 of the issued share capital
b the minimum price that may be paid for an ordinary share is 25p exclusive of expenses and
c the maximum price that may be paid for an ordinary share is an amount equal to 50 above the average of the middle market
quotation of an ordinary share of the company as derived from the daily official list of the london stock exchange on the five
business days immediately preceding the day on which the ordinary share is purchased exclusive of expenses 
and this authority shall expire 15 months after the date of the passing of this resolution or at the conclusion of the next annual general
meeting of the company whichever comes first except in relation to purchases of shares the contract for which was concluded before
the expiry of this authority and which might be executed wholly or partly after such expiry
by order of the board
c corina k ross
company secretary
19 may 2006
registered office
35 duchess road
rutherglen
glasgow
g73 1au
notice of annual general meeting 90 mitie group plc
n notes
1 any member entitled to attend and vote at this meeting may appoint one or more proxies to attend and on a poll vote instead of him
or her a proxy need not be a member of the company
2 to be effective forms of proxy duly completed must be received by the company’s registrars computershare investor services plc
po box 1075 bristol bs99 3fa not less than 48 hours before the time appointed for the holding of the meeting or any adjournment
thereof completion of a form of proxy does not preclude a member from attending the meeting and voting in person
3 the company pursuant to regulation 41 of the uncertificated securities regulations 2001 specifies that only those members registered
in the register of members of the company as at 600pm on 25 july 2006 shall be entitled to attend andor vote at the meeting in
respect of the number of shares registered in their name at that time changes to entries on the register of members after 600pm on 
25 july 2006 shall be disregarded in determining the rights of any person to attend or vote at the meeting
4 the following documents will be available for inspection at the registered office and head office of the company during normal
business hours on any weekday public holidays excepted from the date of this notice until the date of the meeting and at the place
of the meeting from 1145 am until its conclusion
• the register of directors’ interests in the share capital of the company and
• copies of the directors’ service agreements and letters of appointment
5 the total number of options to subscribe for ordinary shares that were outstanding as at 18 may 2006 was 12010666 representing
approximately 39 of the issued share capital of the company this would represent 43 of the issued share capital if the maximum
number of ordinary shares were purchased under the authority proposed under resolution 14
notice of annual general meeting continued mitie group plc 91
r results
2006 half year 28 november 2005
2006 full year 22 may 2006
2007 half year 27 november 2006
d dividends
2006 interim 19p 2005 16p paid 31 march 2006
2006 final proposed 24p 2005 18p ex dividend date 6 september 2006
record date 8 september 2006
payment date 29 september 2006
a annual general meeting 
the merchants’ hall 27 july 2006
the promenade
clifton down
bristol
bs8 3nh 
c capital history
mid market price 2 april 2001 date of subdivision 1525p
mid market price 31 march 2006 1915p 
2006 highlow 211p14675p
r registrars
computershare investor services plc telephone 0870 702 0010
lochside house website wwwcomputersharecom
7 lochside avenue
edinburgh park
edinburgh 
eh12 9dj
c company
mitie group plc telephone 0117 970 8800
8 monarch court fax 0117 302 6743
the brooms contact groupmitiecouk
emersons green website wwwmitiecouk
bristol 
bs16 7fh registered number sc 19230
these financial statements may be downloaded in pdf format from the group’s website which also contains additional general
information on the group
shareholder information 92 mitie group plc
designed by wwwluminouscouk
printed by mitie document solutions 
using vegetable oil based inks on 
hello gloss and soporset
hello gloss and soporset are produced using fibre 
from sustainable forests saw mill residues and forest thinnings  mitie group plc
8 monarch court
the brooms
emersons green
bristol 
bs16 7fh
telephone 0117 970 8800
facsimile 0117 302 6743
email groupmitiecouk
wwwmitiecouk


Summary:
 2 mitie group plc
growing together
ever since mitie started there has been a common theme to our progression as
a company… growth the group has not only grown financially over the years
we have also grown our people the number of customers and the level of
service we provide to them
central to this commitment is our unique business model mitie which stands for
management incentive through investment equity stands out from its peers
because it offers entrepreneurs the chance to develop a business idea in line
with the core services offered by the group with the hard work enthusiasm and
customer dedication of a small company and the support and professionalism
of a large plc these businesses can then develop and grow 
we place particular emphasis on enabling our people to develop to their 
full potential in the belief that if we look after them they will look after our
customers our employees are therefore focused on working hard together and
supporting and listening to their customers we serve many sectors both public
and private and provide an extensive range of services with one common
focus… our customer 
mitie at a glance
39000 employees 
6128 customers
19 years of growth
1mitie mitie group plc 3
our values… together we are mitie
mitie people are motivated knowledgeable and passionate about their
customers they are also rewarded respected and properly equipped for 
their jobs we train and develop our staff and we care about their health 
and safety
we provide opportunities for our employees to grow so that our customers
receive loyalty added value the ability to focus on their core business flexibility
quality services responsiveness and choice we listen to our customers’ needs
communicate effectively and work in partnership to provide multiple services
this means that our shareholders and the communities in which we operate
receive sustainable performance longterm commitment and corporate
responsibility mitie is an entrepreneurial company with good governance 
strong management financial stability and a clear strategy
a proven track record of growth
profit before tax dividend based on ordinary shares of 25p
88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05
5
4
3
2
1
0
06 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05
60
50
40
30
20
10
0
06
support services £345m
property services £90m
engineering services £72m
cleaning £2047m
catering £136m
landscaping £44m
pest control £47m
security £872m
managed services £823m
business services £168
engineering maintenance £1023m
property services £1635m
engineering services £2561m
profit by segment turnover by service
£m p
year year
1988–2004 reported under uk gaap 2005 restated under ifrs
profit before tax preamortisation