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07/12/2005

Adoption of IFRS

Mitchells & Butlers plc ("the Group") today releases its financial results for the 53 weeks to 1 October 2005 as prepared under International Financial Reporting Standards ("IFRS").

Preliminary results for the 53 weeks to 1 October 2005 under UK GAAP were released on 30 November 2005 and are available on the Group’s website www.mbplc.com/IFRS

The key headlines from the restated accounts for the 53 weeks to 1 October 2005 are:

  • Profit before tax and exceptional items of £193m, £2m lower than under UK GAAP.
  • Effective tax rate before exceptional items of 31%, one percentage point lower than under UK GAAP.
  • Profit after tax and before exceptional items of £133m, same as under UK GAAP.
  • EPS before exceptional items of 26.0p, same as under UK GAAP.
  • Profit after tax and exceptional items of £130m, £3m lower than under UK GAAP.
  • Net assets at 1 October 2005 of £1,183m, £234m lower than under UK GAAP.

The above changes to the Group’s reported financial information from the adoption of IFRS are consistent with previous guidance given and mainly result from:

  • Profit before tax – increased charge for the cost of share-based payments.
  • Tax charge – benefit of a lower permanent difference in respect of depreciation.
  • Net assets – recognition of additional deferred tax liabilities relating to the revaluation of properties and gains previously rolled over into replacement assets.

The adoption of IFRS will have no impact on the underlying operations, cash flows or debt covenants of the Group.  However, the new regime may lead to some increased volatility in reported numbers, particularly net assets.

For further information contact:

Erik Castenskiold, Head of Investor Relations 0121 498 4907

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