Final Results

22 May 2014

Booker Group plc

Final Results of Booker Group plc

for the 52 weeks ended 28 March 2014

This announcement contains the final results of Booker Group plc ('Booker' or the 'Company') for the 52 weeks ended 28 March 2014. Booker is the UK's leading food wholesaler.

Financial Highlights

· Total sales £4.7bn, +17.3%

· Booker like-for-like sales (excluding Makro) +2.1%. Non tobacco sales up 4.4% and tobacco sales down 1.7%

· Operating profit (pre £3.4m net exceptional credit related to Makro acquisition) +23% to £120.4m

· Operating profit (post exceptionals) £123.8m, +30%

· Profit before tax (pre exceptionals) £118.7m, +25%

· Profit after tax (post exceptionals) £105.2m, +38%

· Basic earnings per share up 1.55 pence to 6.06 pence

· Net cash improved to £149.6m (2013: £77.2m)

· Total dividend of 3.20 pence per share, up 22%

· Proposed return of capital of 3.50 pence per share

Operational Highlights

· Our plan to Focus, Drive and Broaden Booker Group continues to make progress

· Our best ever customer satisfaction at Booker and Makro

· Makro turnaround is on track, having delivered £26m of synergies

· Internet sales up 10% to £777m

· Booker Direct, Ritter Courivaud, Classic and Chef Direct continue to make good progress

· We now have six branches in India, having opened two branches in the year

Return of capital

In July 2012 Booker Group plc issued £124m of shareholder equity to acquire Makro in the UK. Following the successful integration of Makro into the Group and a period of strong cash generation, the Board is proposing to implement a capital return to shareholders of 3.50 pence per ordinary share (at a cost of approximately £61m, based on the current issued share capital of the Company). It is proposed that this is achieved by the issue of a new class of "B" shares which shareholders will be able to redeem for cash. The return of capital requires the approval of shareholders, which will be sought at the Annual General Meeting on 9 July 2014. Further details of the proposed return of capital will be set out in a circular to shareholders which will accompany the notice convening this year's Annual General Meeting. We currently anticipate returning a similar amount to shareholders in July 2015 and will provide an update on this at the 2015 Final Results announcement in May 2015, in light of circumstances prevailing at that time.

Outlook

The Group's trading in the first seven weeks of the current financial year is ahead of last year. We anticipate that the challenging consumer and market environment will persist through the coming year and the UK's food market remains very competitive.

Whilst there is increasing price competition in the UK grocery and discount sectors, we will continue to deliver our plans to offer our customers even better choice, prices and service supported by the continued delivery of the Makro synergy plans and our efficiency programmes. We are on track to deliver an outcome for the new financial year in line with our plans and to make progress in this challenging environment.

Charles Wilson, Chief Executive of Booker, said:

"Our plan to Focus, Drive and Broaden the business remains on track. Customer satisfaction continued to improve and we achieved our best satisfaction ever. We grew the Group to £4.7bn of sales. Most importantly we teamed up with Makro to become the UK's leading wholesaler to caterers, retailers and small businesses. We strive to provide our customers with improved choice, prices and service via the internet, delivery and cash and carry. We have a great team at Booker and Makro and together we will help our customers prosper in the year ahead."

For further information contact:

Tulchan Communications (PR Adviser to Booker Group plc)

020 7353 4200

Susanna Voyle

Will Smith

A presentation for analysts will be held at 8.30am on Thursday 22 May 2014 at Investec's offices.

For further details please contact Melanie Curtis at Tulchan Communications on 020 7353 4200 or [email protected]

NOTES:

· Sales are stated net of value added tax

· Booker Wholesale supplies independent retailers and caterers via the internet, delivery and cash and carry

· Booker India is a wholesaler in India operating from four sites in Mumbai, one in Surat and, via a joint venture, one site in Pune

· We acquired Makro Holding Limited and two subsidiaries: Makro Properties Limited and Makro Self Service Wholesalers Limited, ('Makro') on 4 July 2012. Makro is a wholesaler supplying independent retailers and caterers, and small companies and offices. We notified the transaction to the Office of Fair Trading ('OFT') who then referred the matter to the Competition Commission ('CC'). This review was incomplete at 29 March 2013, the prior year's year end date, and we were required to hold the Makro business separate from the rest of Booker during the period. Accordingly the results of Makro were not reflected in the prior year's results and the consideration was accounted for as an investment. Full clearance of the transaction was received from the CC on 19 April 2013 and Makro's results were consolidated into the Group's accounts from that date

· In 2013/14 a net exceptional item relating to the Makro acquisition of £3.4m has been credited to income. This is the aggregate of the fair value of the assets and liabilities of Makro of £156.1m, less the fair value of consideration paid of £144.9m, less restructuring and integration costs of £5.8m and stock write downs following a rationalisation of product ranges of £2.0m. In 2012/13 an exceptional item, also relating to the Makro acquisition of £3.0m, relating to deal fees and stamp duty, was charged to income

· 2012/13 results have been restated due to the adoption of IAS19 (Revised) 'Employee Benefits' in relation to pension accounting

BUsiness prOFile AND KEY PERFORMANCE INDICATORS

In the UK, the Group has 172 Booker Wholesale business centres, 30 Makro stores and a national delivery network which includes the Ritter-Courivaud and Classic Drinks businesses.

Of our sales, £3.2bn is non-tobacco and £1.5bn is tobacco.

£3.4bn of our sales are collected from the cash and carry by the customer. £1.3bn is delivered to the customers' premises.

Substantial progress has been achieved.

¹ Includes approximately 503,000 customers of Booker Wholesale, 968,000 of Makro, 21,000 of Booker India, 3,000 of Ritter-Courivaud and 3,000 of Classic Drinks

² 2012 was a 53 week statutory reporting period

³ Includes Makro from 19 April 2013 (49 weeks)

⁴ Operating profit restated for the revision to IAS19 (Revised) in relation to pension accounting

chairman's Statement

I am pleased to report that Booker Group plc has delivered another good performance. In the 52 weeks to 28 March 2014 sales rose by 17% to £4.7bn and operating profit of £120.4m was up 23%. Customer satisfaction continued to improve and we had our best satisfaction scores ever. The financial performance was good and the Group ended the financial year with net cash of £149.6m. The drive into the catering market is working, with Booker like-for-like sales to caterers (excluding Makro) up by 7.1%. Booker like-for-like sales to retailers (excluding Makro) fell by 0.5%, due to a contraction in the UK duty paid tobacco market. Makro is now making a real contribution to the Group.

The plans to 'Broaden' the business are going well. In the 52 weeks to 28 March 2014 Booker distributed £1.3bn of product to our customers' premises versus £1.15bn last year as we continue to expand our delivered service. Booker Direct, Chef Direct, Classic and Ritter Courivaud, our specialist delivered businesses, had a good year. Internet sales were £777m compared to £704m in the previous year and sales at Booker India are making good progress.

Much of the year has been spent bringing Makro into the Group. This is on track. We are delighted to have the team from Makro join Booker Group.

I should like to thank all our colleagues for their contribution to the success of the Group in the year just ended.

Basic earnings per share were 6.06 pence, up from 4.51 pence last year. Given the strong operational performance and cash flow of the business the Board recommends the payment of a final dividend of 2.75 pence per share (2013: 2.25 pence per share) which, together with the interim dividend, makes a total dividend for the year of 3.20 pence per share (2013: 2.63 pence per share). The final dividend is payable on 11 July 2014 to shareholders on the register on 13 June 2014.

In addition to the final dividend, the Board is recommending a special capital return to shareholders of 3.50 pence per ordinary share (at a cost of approximately £61m, based on the current issued share capital of the Company). We currently anticipate making a similar return to shareholders in July 2015 and will provide an update on this at the 2015 Final Results announcement in May 2015, in light of circumstances prevailing at that time.

Outlook

The Group's trading in the first seven weeks of the current financial year is ahead of last year. We anticipate that the challenging consumer and market environment will persist through the coming year and the UK's food market remains very competitive.

 Whilst there is increasing price competition in the UK grocery and discount sectors, we will continue to deliver our plans to offer our customers even better choice, prices and service supported by the continued delivery of the Makro synergy plans and our efficiency programmes. We are on track to deliver an outcome for the new financial year in line with our plans and to make progress in this challenging environment.

Annual General Meeting

Our Annual General Meeting will be held on 9 July 2014. The notice of Annual General Meeting and a circular setting out further details of the proposed return of capital which itself, requires shareholder approval, will be issued to shareholders in due course.

Richard Rose

Chairman

Chief Executive's Review

Since November 2005 Booker Group has been seeking to 'Focus, Drive and Broaden' the business. We continue to make good progress.

FOCUS (commenced November 2005)

Booker seeks to become the most efficient operator in our sector. Bryn Satherley and his team continue to improve business efficiency. We 'stop, simplify and standardise' work and invest most of the savings in customer service. Much of the year has been spent integrating Makro into the Group. Through tight cash management we have now increased net cash from £77.2m last year to £149.6m this year. Makro business centres are now operating on the Booker systems. We have also generated synergies of approximately £26m through improving systems, processes and buying across the enlarged Group.

DRIVE (commenced March 2006)

Booker Wholesale, our cash and carry business, served 503,000 customers this year up from 486,000 last year. Guy Farrant and the team continue to 'Drive' choice, price and service for our customers. Each year we survey 40,000 customers to identify where improvements can be made. Customer satisfaction improved again this year and our customer count has increased again, by 17,000 customers. Customer satisfaction is a key measure within the business and we have made significant progress since 2006, achieving our highest ever levels of satisfaction this year.

Choice Up

· In 2010 we launched Farm Fresh. Sales in the year to 28 March 2014 were £65m. The quality and freshness of the produce is second to none and can be delivered to our customers within 48 hours of being harvested.

· During the year we rebranded Booker Basics as Chef's Essentials to appeal to a wider audience. Chef's Essential sales are now £95m per annum.

· We also launched CleanPro. This range of 73 professional cleaning products has been well received by customers.

Prices Down

· We operate in a very price competitive market. Every week we monitor prices versus competitors and during the year our price index remained competitive. In the year we "locked down" prices for caterers which has proved very effective in helping caterers plan their menu with confidence.

Better Service

· Our people are doing an excellent job. Our customers rate Booker people highly. Business Centre teams at Makro have been trained in PRIDE to help improve the Parking, Reception, Internal, Delivery and Exit experience.

· We have continued to expand and improve our delivery service.

· We have more specialist butchers and greengrocers within the business than last year.

Catering

· Catering like for like sales grew by 7.1%, as our choice, price and service continued to improve. Our catering development sales force continues to serve our existing customers and to introduce new customers to Booker.

Premier

· Premier, Booker's symbol group grew to 2,982 stores (2,802 stores last year). Sales to these customers grew by 12%. The retail development team has put a lot of work into both compliance and building the sales and profits of existing Premier stores.

Family Shopper

· During the year we launched Family Shopper. This is a local discount store. We now have six stores and, although it is early days, the response has been encouraging.

BROADEN (commenced April 2007)

In the UK, Booker seeks to offer the best choice, price and service to caterers, retailers and small business. We also seek to become the suppliers' preferred route to market. We also want to sell new products and services and reach new customers. In India we seek to become the best supplier to Kirana stores. To achieve these objectives, we are 'Broadening' the business. 'Broaden' includes:

Makro

· The most important change we have made to Broaden the Group is the acquisition of Makro. Makro serves around one million small business customers, has great people, good locations and excellent products. Through Booker and Makro coming together we seek to become the UK's leading wholesaler to caterers, retailers and small businesses. We will offer our customers better choice, prices and service via the internet, delivery and cash and carry. The transaction was cleared by the Competition Commission on 19 April 2013. Makro has fitted nicely into the Group. We have embarked on a rapid turnaround. As a result cash management has been tightened and we have improved profits from a loss of £18m in 2012, to a profit of £11m this year. Having exited some unprofitable product categories, sales were down 9% but customer satisfaction has improved significantly. We are planning that Makro will continue to experience a sales loss in the year ahead as we continue to focus on professional customers. In Sheffield, Belfast and Preston we have developed a new Makro/Booker format. The format has been tailored to the local market and we expect to complete five more of these conversions in the year ahead. Critically, Makro is increasing our capacity to grow delivered sales. This should help the Group grow to an estimated £6bn of sales in the next few years. I am pleased the team at Makro have settled into the Group. It is a credit to the teams at Booker and Makro that the integration has gone so smoothly. I am very grateful to all the teams for the hard work this year.

Improving the cash and carry business centre experience

· We have now converted 150 of our 172 business centres to the 'Extra' format. This features a lighter, brighter business centre environment and an improved choice, price and service. The conversion pays back in around a year and we plan to convert a further three business centres to 'Extra' in the year ahead. The lessons from Extra will be rolled to the rest of the business and to Makro.

Harnessing the Internet

· Sales at booker.co.uk were £777m, up from £704m last year and £15m in 2005. All these sales are delivered to our customers' premises. We have 334,000 customers registered on the website compared to 255,000 last year. Customers can view their account details, use an iPhone app and order products. We have also doubled the number of stock keeping units available to a typical customer on the website through our special order system. This has generated incremental sales of £4m.

Booker Direct/Ritter-Courivaud/Classic Drinks/Chef Direct

· Mark Aylwin and his team are building our delivered wholesale business. Booker Direct has great customers including the prison service in England and Wales, Marks & Spencer and most of the cinema chains in the UK.

· In 2010 we acquired Classic Drinks, an on-trade wholesaler supplying pubs and licensed customers mainly in the North West. We are in the process of rolling this expertise out on a national basis.

· In 2010 we acquired Ritter-Courivaud, a leading speciality food supplier to restaurants. Through combining the logistics expertise we have in Booker Direct, with the catering knowledge from Ritter-Courivaud and the Groups' buying scale, we launched Chef Direct in 2012. Chef Direct is based in Didcot and has won some important clients such as Aramark. Aramark serves 250,000 meals a day and through working with Booker Direct, the road miles have been halved and service improved.

· In the last year the Group delivered £1.3bn of product to retailers and caterers in the UK. Through using some of the space in the Makro business centres we will be able to increase our delivered business.

Booker India

· In September 2009 we opened our first business centre in Mumbai. We now have four branches in Mumbai, one in Surat and one joint venture branch in Pune. We serve over 21,000 customers and have also launched 200 Happy Shopper symbol retailers, which harness the lessons learned from Premier in the UK forthe Kirana stores of Mumbai. We are reviewing growth options in India and look forward to developing the Booker offer to become the best choice, price and service supplier to Kirana stores and caterers.

Sustainability

· Booker was the first UK wholesaler to achieve a third consecutive Carbon Trust Standard and the first in the UK to achieve the new Carbon Trust Waste Standard. Booker are also The Grocer Gold "Green Wholesaler of the Year" 2013.

· 16,000 customers are now recycling with Booker through our packaging and used cooking oil recycling services. This helps our customers save money, increase recycling levels and support more sustainable communities throughout the UK.

· Customer recycling volumes are up 40% against last year.

· We donated surplus food equivalent of 200,000 meals to local charities in the last year

· We also helped many customers and communities who were impacted by the flooding. In the sixteen most impacted locations we supported customers with a fund of £350,000 of free stock and support.

People

· The progress made by the business this year is a credit to our great team of people. We are committed to continuing to make Booker better and safer for colleagues. We are also developing talent. For example, there is a shortage of butchers in the trade, so we have partnered with the University of West London to develop a formal "butchery apprenticeship". 28 new butchers graduated this year. We developed a similar scheme for greengrocers with 50 colleagues graduating this year. We intend to run both schemes again in 2014/15.

· For the seventh year running, the performance of the business means our people have shared in our success through our bonus system. With this great team of people, Booker will continue to make progress in the year ahead.

· During the storms and flooding, our people did a fantastic job of maintaining service to our customers.

Our plan to Focus, Drive and Broaden the business remains on track. Customer satisfaction continued to improve and we grew the Group to £4.7bn of sales. Most importantly we teamed up with Makro to become the UK's leading wholesaler to caterers, retailers and small businesses. We will provide our customers with improved choice, prices and service via the internet, delivery and cash and carry. We have a great team at Booker and Makro and together we will help our customers prosper in the year ahead.

Charles Wilson

Chief Executive

group finance director's report

Financial Review

In 2013/14 IAS 19 (revised) 'Employee Benefits' was adopted and the prior year's figures have been restated to reflect the change. In order to make a comparison to last year, all reported income statement numbers in the Group Finance Director's Report are compared with last year's restated position. Makro has been consolidated since 19 April 2013.

The summary of results for the Group is as follows:

Overall Group revenue increased by 17% to £4.7bn. Booker non tobacco like for like sales (excluding Makro) increased by 4.4% while like for like tobacco sales decreased by 1.7%.

Operating margin increased by 0.12 percentage points to 2.57% (2013: 2.45%) increasing group operating profit by £22.5m to £120.4m. The improvement in margin was due to a favourable product mix and control of costs.

A net £3.4m exceptional credit has been taken to the income statement in the period (2013: £3.0m charge). The credit relates to the £11.2m difference between the fair value of Makro's assets and liabilities at the date of consolidation and the fair value of consideration paid, offset by £7.8m of exceptional costs.

The net finance charge of £1.7m (2013: £2.8m) relates mainly to the unwind of the discounting of provisions.

Profit before tax rose £30.0m to £122.1m (2013: £92.1m), an increase of 33%.

The underlying effective tax rate (the tax charge as a percentage of profit before taxation and exceptional items) for the Group of 14.8% (2013: 16.9%) was below the standard rate of corporation tax in the UK of 23% (2013: 24%). This was due principally to the utilisation of ACT from prior years, the release of a prior year provision held in respect of former overseas businesses and tax relief arising from exercise of share options during the year. The Group holds significant tax assets, notably Makro tax losses and ACT, which continue to be unrecognised as the quantum and timing of their utilisation remains uncertain. Utilisation of these assets could result in the underlying effective rate of tax remaining below 20% for the next three years.

A tax credit of £0.7m arises on the exceptional item, which is after taking account of a charge arising from the revaluation of Makro's deferred tax asset at the balance sheet date following the enactment on 2 July 2013 of reduced future rates of corporation tax. The effective rate of tax on post exceptional profits is 13.8% (2013: 17.5%).

Profit after tax was £105.2m, an increase of £29.2m compared to 2013.

Basic earnings per share rose to 6.06p, up 34% from 4.51p in 2013.

Dividend

The Board is recommending a final dividend of 2.75 pence per share (2013: 2.25 pence per share), up 22%, payable (subject to shareholder approval at the Annual General Meeting, to be held on 9 July 2014) on 11 July 2014 to shareholders on the register at 13 June 2014. The shares will go ex-dividend on 11 June 2014.

The final dividend increases the total dividend for the year to 3.20 pence per share, up 22% on 2013 (2013: 2.63 pence per share).

Return of Capital

In July 2012 Booker Group plc issued £124m of shareholder equity to acquire Makro in the UK. Following the successful integration of Makro into the Group and a period of strong cash generation, the Board is proposing to implement a capital return to shareholders of 3.50 pence per ordinary share (at a cost of approximately £61m, based on the current issued share capital of the Company). It is proposed that this is achieved by the issue of a new class of "B" shares which shareholders will be able to redeem for cash. The return of capital requires the approval of shareholders, which will be sought at the Annual General Meeting on 9 July 2014. Further details of the proposed return of capital will be set out in a circular to shareholders which will accompany the notice convening this year's Annual General Meeting. We currently anticipate returning a similar amount to shareholders in July 2015 and will provide an update on this at the 2015 Final Results announcement in May 2015, in light of circumstances prevailing at that time.

Cash Flow

Management has continued to focus on cash generation resulting in a net improvement of £72.4m in the year to close with a net cash position of £149.6m at 28 March 2014. Earnings before interest, tax, depreciation and amortisation ('EBITDA') of £141.5m and proceeds from asset disposals of £17.6m, funded capital additions of £18.0m (2013: £14.1m) and the payment of £46.6m of dividends (2013: £37.0m).

Pensions

The Booker Pension Scheme ('the Scheme') is a defined benefit scheme that was closed to new members in October 2001, and was closed to future accruals for existing members in August 2002. At 28 March 2014, the Scheme had an IAS 19 deficit of £3.6m (2013: £6.8m), comprising Scheme assets of £611.0m and estimated liabilities of £614.6m. The Group contributed £9.6m (2013: £9.6m) in the year.

The 2013 Triennial valuation has been agreed with the pension fund Trustee and reflects a Scheme Funding deficit of £23.8m at 31 March 2013 to be recovered by £9.6m of scheduled payments in the year to 31 March 2014 and by an assumed outperformance of investment returns relative to the rate at which the future liabilities of the scheme have been discounted. As a consequence, there will be no cash contributions required from the Company after the scheduled quarterly payment of £2.4m on 31 March 2014, subject to the results of subsequent Triennial valuations. The next Triennial valuation date is 31 March 2016.

Goodwill

The net book value of goodwill on the balance sheet is £436.4m (2013: £436.4m). The goodwill carrying value is more than supported by expected future cash flows discounted back to present day values at a pre-tax discount rate of 10.5% (2013: 10.8%).

Capital Structure

The Group finances its operations through a combination of bank facilities, leases and retained profits and its capital base is structured to meet the ongoing requirements of the business. As at 28 March 2014, the Group had net cash of £149.6m (2013: £77.2m).

Borrowing Facilities

The Group entered into a five year facility on 28 July 2011 comprising an unsecured £120.0m revolving credit facility.

The Group's borrowings are subject to covenants set by the lenders. In the event of a failure to meet certain obligations, or if there is a covenant breach, the principal amounts due and any interest accrued are repayable on demand.

The financial covenants are Fixed Charge Cover, measured by the ratio of EBITDAR (earnings before interest, tax, exceptional items, depreciation, amortisation and rent) to interest plus rent (tested half yearly on a rolling basis) being greater than 1.5, and Leverage, measured by the ratio of net debt to EBITDA (earnings before interest, tax, depreciation and amortisation) (tested half yearly on a rolling basis) being less than 3.0.

The Group complied with its covenants throughout the year. At 28 March 2014 the Group achieved a Fixed Charge Cover of 3.9 and Leverage of nil, comfortably exceeding its covenant obligations.

In addition to these financial covenants the Group's borrowing agreements include general covenants and potential events of default. The Group has complied in all respects with the terms of its borrowing agreements at the date of this report.

Interest Rates

Funds drawn on the revolving credit facility bear floating interest rates linked to LIBOR plus a margin of 1.25%, where the ratio of net debt/ EBITDA is less than one. A commitment fee is payable at 0.5% of the unutilised facility.

The net cost of the facility during the year was £0.2m (2013: £0.5m).

Liquidity

At 28 March 2014, the Group held £149.6m in cash and cash equivalents. The Group also had in issue £4.9m of guarantees (2013: £5.5m) leaving undrawn facilities at 28 March 2014 of £115.1m.

The Company did not draw down on its revolving credit facility on a cleared basis in the year to 28 March 2014 giving a minimum facility headroom in the year of £113.0m after taking into account the guarantees facility of £7.0m.

Guidance

Whilst there is increasing price competition in the UK grocery and discount sectors, we will continue to deliver our plans to offer our customers even better choice, prices and service supported by the continued delivery of the Makro synergy plans and our efficiency programmes. We are on track to deliver an outcome for the new financial year in line with our plans and to make progress in this challenging environment.

The Acquisition of Makro

On 4 July 2012 Booker Group plc acquired Makro Holding Limited and two subsidiaries: Makro Self Service Wholesalers Limited and Makro Properties Limited (together 'Makro').

The transaction was subject to competition approval and, during this process, we were required to hold Makro separate from the rest of Booker in accordance with undertakings given to the competition authorities in the normal way. The competition review was still ongoing at 29 March 2013 and during this hold separate period, under accounting rules (IFRS 3 and IAS 27), Makro's results were required to be excluded from the Group's results. At 29 March 2013, therefore, the consideration paid for Makro was held as an investment in the Group's balance sheet. Full clearance of the transaction was received by the Competition Commission on 19 April 2013 and Makro was consolidated from that date.

In the year ended March 2014, the Group's operating profit increased by circa £11m as a result of the acquisition. This is the aggregate of an estimated base operating loss of £15m for Makro and Group synergy benefits in the year of approximately £26m across the Group. We anticipate additional synergy benefits of £4m next year and £2m the following year. This will help improve choice, price and service for our customers.

Booker was required to fair value Makro's assets and liabilities at the date of consolidation. At this date Makro had 24 freehold and six long leasehold properties, which were independently valued at £144m on a vacant possession basis in 2012. The fair value of Makro's assets and liabilities at the date of consolidation was £156.1m, greater than the fair value of consideration paid by £11.2m, and this difference has been credited to the Group's income statement as an exceptional item in the period. Restructuring and integration costs of £5.8m, and stock write downs following a rationalisation of product ranges of £2.0m, have also been charged as exceptional items in the period.

Jonathan Prentis

Group Finance Director

Disclaimer

This announcement may include "forward-looking statements" with respect to certain of Booker Group plc's ('Booker') plans and its current goals and expectations relating to its future financial condition, performance and results. These forward-looking statements sometimes contain words such as 'anticipate', 'target', 'expect', 'intend', 'plan', 'goal', 'believe', 'may', 'might', 'will', 'could' or other words of similar meaning. By their nature, forward-looking statements involve known and unknown risks and uncertainties because they relate to future events and circumstances which may be beyond Booker's control, including, among other things, UK domestic and global economic and business conditions, market-related risks such as fluctuations in interest rates and exchange rates, the policies and actions of regulatory authorities, the impact of competition, the possible effects of inflation or deflation, the impact of tax and other legislation and regulations in the jurisdictions in which Booker operates, as well as the other risks and uncertainties set forth in our announcement of preliminary results for the 52 weeks ended 28 March 2014, released on 22 May 2014. As a result, Booker's actual future financial condition, performance and results may differ materially from those expressed or implied by the plans, goals and expectations set forth in any forward-looking statements, and persons receiving this presentation should not place reliance on forward-looking statements.

Booker expressly disclaims any obligation or undertaking (except as required by applicable law) to update the forward-looking statements made in this presentation or any other forward-looking statements it may make or to reflect any change in Booker's expectation with regard thereto or any changes in events, conditions or circumstances on which any such statement is based. Forward-looking statements made in this presentation are current only as of the date on which such statements are made.

All oral or written forward-looking statements attributable to the Directors of Booker or persons acting on their behalf are qualified in their entirety by these cautionary statements.

None of the statements in this presentation are, nor are any intended to be, a profit forecast and none should be interpreted to mean that the profits or earnings per share of Booker in the current or any future financial period necessarily is or will be above or below the equivalent figure for any previous period.

Condensed Consolidated Financial Statements

Consolidated Income Statement

For the 52 weeks ended 28 March 2014

All of the Group's operations during the period shown above represent continuing operations.

Consolidated Statement of Comprehensive Income

* The restatement impacting prior periods is explained in more detail in note 1e.

Consolidated Balance Sheet

Consolidated Cash Flow Statement

Reconciliation of net cash flow to movement in net cash in the period

* The restatement impacting prior periods is explained in more detail in note 1e.

Consolidated Statement of Changes in Equity

52 weeks ended 28 March 2014

52 weeks ended 29 March 2013

* The restatement impacting prior periods is explained in more detail in note 1e.

Notes to the Group Financial Statements

a) Overview

Booker Group plc is a public limited company incorporated in the United Kingdom (Registration number 05145685). The Company is domiciled in the United Kingdom and its registered address is Equity House, Irthlingborough Road, Wellingborough, Northamptonshire, NN8 1LT.

b) Status of financial information

The financial information set out herein does not constitute the Company's statutory accounts for the 52 weeks ended 28 March 2014 or the 52 weeks ended 29 March 2013 but is derived from those accounts. Statutory accounts for 2013 have been delivered to the Registrar of Companies, and those for 2014 will be delivered in due course. The auditors have reported on those accounts; their report was (i) unqualified, (ii) did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain statements under sections 498(2) or 498(3) of the Companies Act 2006.

c) Basis of accounting

In accordance with EU law (IAS Regulation EC 1606/2002), the group financial statements have been prepared in accordance with International Financial Reporting Standards ('IFRS') adopted for use in the EU as at 28 March 2014 ('adopted IFRS'), International Financial Reporting Interpretations Committee ('IFRIC') interpretations and those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The preliminary results consolidate those of the Company and its subsidiaries (together referred to as the 'Group').

d) Basis of consolidation

Subsidiaries are entities controlled by the Group. Control exists when the Group has the power, directly or indirectly, to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that are currently exercisable or convertible are taken into account. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

During the prior period, the Group acquired the entire share capital of Makro Holding Limited ('Makro') which has two subsidiaries: Makro Properties Limited and Makro Self Service Wholesalers Limited. The transaction was subject to Competition Commission approval and, whilst this process was in progress, the Group was required to hold Makro separate from the rest of Booker in accordance with undertakings given to the competition authorities in the normal way. As a result, the Group had neither control nor significant influence over Makro, and therefore it had not met the requirements for consolidation as set out in IFRS3 (revised) 'Business Combinations' and IAS27 'Consolidated and Separate Financial Statements'. In accordance with IAS39 'Financial Instruments: Recognition and Measurement', the investment was held as an available for sale financial asset. Cash subsequently advanced from Makro at the prior year end was shown within creditors.

Full clearance to the acquisition of Makro was received from the Competition Commission on 19 April 2013 and Makro has been consolidated from this date, being the date that control passed to the Group.

e) Accounting standards adopted in the period

The Group has adopted the following amendments and interpretations:

· Amendments to IAS 19 'Defined Benefit Plans (2011)'

· IFRS 13 'Fair Value Measurement'

· Amendments to IAS 1 'Presentation of Items of Other Comprehensive Income (2010)'

As a result of IAS 19 (2011), the Group has changed its accounting policy with respect to the basis for determining the income or expense related to the defined benefit pension scheme.

Under IAS 19 (2011), the Group determines the net interest expense/(income) for the period on the net defined benefit liability/asset by applying the discount rate used to measure the defined benefit obligation at the beginning of the period to the net defined benefit liability/asset at the beginning of the period, taking into account any changes in the net defined benefit liability/asset during the period as a result of contributions and benefit payments. Previously, the Group determined interest income on plan assets based on their long term rate of expected return.

The effect of the accounting policy change is as follows:

a) Basic earnings per share

Basic earnings per share is calculated by dividing the profit for the period attributable to the owners of the Group by the weighted average number of ordinary shares outstanding during the period.

b) Diluted earnings per share

Diluted earnings per share is based on the weighted average number of ordinary shares in issue adjusted by dilutive outstanding share options and dilutive shares issuable under the Group's share plans. The number of shares included in the diluted EPS in relation to the SAYE and the share option schemes has been calculated in accordance with IAS 33 'Earnings per Share'.

6. Dividends

Dividends charged to reserves

The Directors are proposing a final dividend of 2.75 pence per share, which will absorb £48m of equity (distributable reserves). Subject to shareholder approval at the AGM, to be held on 9 July 2014, the dividend will be paid on 11 July 2014 to shareholders on the register at 13 June 2014. The shares will go ex-dividend on 11 June 2014.

The Board is proposing to implement a capital return to shareholders of 3.50 pence per ordinary share (at a cost of approximately £61m, based on the current issued share capital of the company). It is proposed that this is achieved by the issue of a new class of "B" shares. The return of capital requires the approval of shareholders, which will be sought at the AGM on 9 July 2014.

7. Business combination

Full clearance to the acquisition of Makro was received from the Competition Commission on 19 April 2013 and Makro was consolidated from this date, being the date that control passed to the Group.

The acquisition had the following effect on the Group's assets and liabilities as at 19 April 2013:

The fair value adjustments made on acquisition have had the effect of:

· increasing the property valuations;

· providing for onerous contracts; and

· recognising a deferred tax asset in relation to accelerated capital allowances.

8. Property, plant and equipment

9. Retirement benefit liabilities