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Mitie Group emerges from challenging FY 2017

03 May 2017 09:32

Mitie Group said its trading performance, before the impact of the Accounting Review, is largely in line with previous expectations.

Revenues remained flat in FY 2017, versus FY 2016, reflecting what had been a challenging environment.

In response to the findings of KPMG's accounting review, and in addition to the £14m of one-off charges identified in a January trading update, directors expected to write down Mitie's balance sheet by £40m-£50m.

Of this total, only £6m related to provisions that were expected to result in cash outflows in FY 2018, with the majority being non-cash write-downs of trading assets, and having no impact on the future profitability of the business.

"In addition, the review has identified a number of material errors which may necessitate restating our FY 2016 accounts. This would likely result in an increase in FY 2017 reported results of between £10m and £20m," said Mitie.

"The costs of change have increased by £5m to £15m since January as some further 160 roles have been removed in the first wave of a new cost reduction programme, full details of which will be shared at the time of our Preliminary Results."

CEO Phil Bentley said FY 2017 was undoubtedly a challenging year, but Mitie remained a strong and successful business, and was continuing to deliver for its customers.

"Whilst these accounting adjustments in FY 2017 affect our reported profits, they do not affect the underlying strength of our business."

At 9:32am: (LON:MTO) MITIE Group PLC share price was +13.35p at 224.75p

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