2568.11 kb - Compass Group

58 Compass Group PLC Annual Report 2007Notes to the consolidated financial statementsfor the year ended 30 September 20077 Exceptional itemsExceptional items are disclosed and described separately in the financial statements where it is necessary to do so to clearly explain the financialperformance of the Group. Items reported as exceptional are material items of income or expense that have been shown separately due to thesignificance of their nature or amount.2007 2006Exceptional items £m £mContinuing operationsCurrent year tax – 5Adjustment in respect of prior year’s tax – 17Current year tax – 22Current year deferred tax – 22Adjustment in respect of prior year’s deferred tax – –Current year deferred tax – 22Continuing operations (note 5) – 44Discontinued operationsProfit on disposal of net assets and other adjustments relating to discontinued operations net of tax (note 6) 197 20Settlement of UN contract claims and related expenses – (39)Middle East military catering business – (8)Discontinued operations 197 (27)Continuing and discontinued operationsTotal 197 17Year ended 30 September 2007:The Group disposed of its European vending business, Selecta, on 2 July 2007 for a net profit after tax of £129 million.The Group also completed the sale and closure of a number of other small businesses as part of the exit from discontinued operations, andestablished additional provisions totalling £45 million in respect of prior year disposals in these areas, resulting in a net loss after tax of £11 millionbefore the net release of tax provisions of £79 million. These provisions were released following the settlement of a number of long-standing issuesconnected with prior year discontinued activities. The total net profit after tax arising on disposal of these operations was £68 million.Overall an exceptional net credit of £197 million was recognised in the period.Year ended 30 September 2006:A £44 million exceptional tax credit arose in respect of previously unrecognised tax losses and tax deductions in respect of pension prepaymentsin the UK tax group that originated in previous years.£39 million was charged to complete investigations and to settle lawsuits for lost profits brought by two competitors of the Group, ES-KOInternational Inc and Supreme Foodservice AG in relation to contracts awarded to Eurest Support Services by the United Nations.£8 million was provided to settle claims arising in respect of the discontinued Middle East military catering operations.A profit of £20 million (net of cumulative translation exchange losses and tax) was recognised in respect of the disposal of the Group’s Inflightcatering services business on 19 December 2005 and its travel concessions catering business (‘SSP’) on 15 June 2006.