1

Roger CarrRoger Carr

ChairmanChairman

Preliminary Results – 29 November 2007

2

KarimKarim NaffahNaffah

Finance DirectorFinance Director

Preliminary Results – 29 November 2007

3

Financial HighlightsFinancial Highlights

Revenue £1,894m 10.1 %

EBITDA* £472m 9.8 %

Operating profit* £343m 11.0 %

Profit before tax* £207m (0.5) %

EPS* 35.5p 21.2 %

Total dividend 14.25p 16.3 %

*Before exceptional items

52 weeks ended 29 September 2007 % Growth

4

Presentational Points to Note Presentational Points to Note –– FY 2007 FY 2007

FY 2007 events

Special Dividend of £486m and share consolidation in Oct 2006

Disposal of 102 pubs to Trust Inns for £101m in Oct 2006

Results include a full year of the Acquired Sites

Revenue £176m; operating profit* £33m

Pre-opening and closure costs of £14m in FY 2007

Acquired Sites included in like-for-like sales from FY 2008

Revaluation of property assets in Group accounts

Increases fixed asset value by £1.1bn

Exceptional charge of £32m after tax

Reporting to debt investors

* Before pre-opening and closure costs

5

FY 2007 Results - SummaryFY 2007 Results - Summary

FY 07 FY 06

£m £m

Operating Profit* 343 309 11.0%

Net Interest (136) (101)

PBT* 207 208 (0.5)%

Tax (62) (64)

Earnings* 145 144 0.7%

EPS* 35.5p 29.3p 21.2%

Average no. of shares 408m 491m

* Before exceptional items

6

HedgingHedging

Put in place to support delivery of JV transaction

Interest rate and inflation swaps

Post tax deficit of £155m at year-end date

Falling long term interest rates

Rising long term inflation expectations

Reduced liquidity

Exceptional accounting item – not cash

Utilise hedges in a future property based financing

Remain committed to property-based refinancingRemain committed to property-based refinancing

7

FY 2007 Results FY 2007 Results –– Exceptional Items Exceptional Items

£m Gross Net

Operating Profit

- Financial hedges (221) (155)

- Property disposals 22 15

- Impairment from revaluation (45) (32)

- Integration of Acquired Sites (4) (3)

- Property JV transaction (7) (7)

- Tax adjustments 27

Total Exceptional Items (255) (155)

8

Operating PerformanceOperating Performance

FY 07 FY 06

£m £m

Revenue

Pubs & Bars 968 958 1.0%

Restaurants 908 762 19.2%

SCPD 18 -

1894 1720 10.1%

Operating Profit*

Pubs & Bars 191 179 6.7%

Restaurants 145 130 11.5%

SCPD 7 -

343 309 11.0%

Retail

+9.1%

Retail

+8.7%

*Before exceptional items

9

Underlying Profit GrowthUnderlying Profit Growth

+ 4.0%129 16145Operating Profit

+ 2.7%748 160908Revenue

Restaurants

+ 11.9%+ 5.0%188 3191Operating Profit

+ 3.5%- 0.6%952 16968Revenue

Pubs & Bars

%%£m£m£m

Adjusted

Growth

vs LY*

Core

Growth

vs LY

Core

Estate

Acquired

Sites

Division

Total

FY 2007

*Excluding contribution from major disposals

Strong underlying improvement in marginsStrong underlying improvement in margins

10

Like-for-Like Sales: Divisional*Like-for-Like Sales: Divisional*

FY 07 H1 07**

Same Outlet (Invested and uninvested pubs)

Pubs & Bars 4.7% 5.1%

Restaurants 1.0% 1.6%

Total*** 3.0% 3.6%

Uninvested

Pubs & Bars 3.0% 3.4%

Restaurants 0.1% 0.4%

Total*** 1.7% 2.1%

* Excludes Acquired Sites

** 32 weeks to include the entire Easter Period

*** Includes Hollywood Bowl

11

Like-for-Like Sales: Segment*Like-for-Like Sales: Segment*

FY 07 H1 07**

Same Outlet (Invested and uninvested pubs)

Residential 3.1% 4.1%

High Street 3.0% 2.9%

Total 3.0% 3.6%

Uninvested

Residential 1.5% 2.3%

High Street 2.3% 2.2%

Total 1.7% 2.1%

* Excludes Acquired Sites

** 32 weeks to include the entire Easter period

12

Balancing Sales Growth & MarginBalancing Sales Growth & Margin

FY 07 H1 07

Uninvested LFL Sales* +1.7% +2.1%

Average Selling Price** up < 2% up 2%

Movement in Gross Margin (%) flat

Movement in LFL Gross Profit (£) +ve +ve

Sustaining LFL cash contribution from salesSustaining LFL cash contribution from sales

* like-for-like sales to 32 weeks to include the entire Easter weekend in both periods

** Drink & Food

Slightly down

13

Retail Operating Statistics*Retail Operating Statistics*

Strong margin performanceStrong margin performance

Same outlet drink sales: up 2.2%

Same outlet food sales: up 5.1%

Outlet staff costs: 23.6% of sales

Tight cost controls

* Excludes Acquired Sites

14

Operating Profit MovementOperating Profit Movement

2005

(8)

Regulatory

Costs

2006

+ £34m

2007

£309m*

£343m*

* Before exceptional items

Trading

+33

SCPD

+7

Acquired

Sites

+27

Disposals

(11)Closure and

Pre-opening

Costs

(14)

15

FY 2007 Expansionary CapitalFY 2007 Expansionary Capital

High Street

Pub Restaurants

Restaurants

Locals

City Centre

Food

led

Drinks

led

Residential

Core £25m

Acquired Sites £12m

Core £20m

Acquired Sites £68m

Core £5m Core £0m

Note: Excludes non trading property (£1m)

16

High Street

Pub Restaurants

Restaurants

Locals

City Centre

Food

led

Drinks

led

Residential

Inc. ROI 22% Inc. ROI 18%

Inc. ROI 11%Inc. ROI 18%

Returns by SegmentReturns by Segment

Notes: Incremental ROI is calculated before tax and after depreciation

Cumulative £1.1bn UK expansionary investment over the last 16 years, excluding Acquired Sites

18% overall incremental ROI18% overall incremental ROI

17

* Unleveraged tax rate

** Excluding 2007 revaluation

Strong Cash ReturnsStrong Cash Returns

£m

343

(89)

254

3,820

(685)

50

3,185

10.8%10.8%

12 months to 29 September 2007

£m

EBIT 343

Depreciation/Amortisation 129

EBITDA 472

Cash Tax (at 26% of EBIT)*

(89)

Cash Return

383

Average Net Operating Assets**

3,820

Accumulated Depreciation 347

Revaluations**

(685)

Goodwill written off 50

CROCCE

8.0%8.0%

NOPAT

18

Cash Flow (a)Cash Flow (a)

FY 07

£m

EBIT 343

Depreciation & amortisation 129

EBITDA 472

Working capital / non cash items 19

Maintenance capex (122)

Expansionary capex (131)

Purchase of Acquired Sites (8)

Disposals 162

Additional pension contributions (40)

Operating Cash Flow after Net Capex* 352

£(99)m

* Before exceptional operating expenditure of £12m

19

Cash Flow (b)Cash Flow (b)

FY 07

£m

Operating Cash Flow after Net Capex 352

Net Interest paid (145)

Tax paid (33)

Normal dividends paid (52)

Special Dividend paid (486)

Exercise of share options 11

Shares repurchased (46)

Net Cash Flow* (399)

* Before total expenditure on exceptional items of £12m and bond repayments of £39m

Closing Net Debt : £2,479mClosing Net Debt : £2,479m

20

Free Cash FlowFree Cash Flow

£191m

Free Cashflow*EBITDA

£472m

Net Cashflow

£(399)m

* Free cashflow = EBITDA + working capital – maintenance capital – interest - tax

21

FinancingFinancing

* Net Debt / (Net Assets + Net Debt)

** Excluding net finance income from pensions

Net Debt : EBITDA 5.25x

Book Gearing* 61%

Interest Cover** 2.3x

Lower net finance income from pensions in FY08Lower net finance income from pensions in FY08

22

PensionsPensions

IAS 19 deficit of £18m, as at 29 September 2007

Updated mortality assumptions

Full Actuarial Valuation as at 31 March 2007

Gilts-based deficit of c.£250m

Recovery plan to close past service deficit

Schedule of future contributions being finalised

Special contribution of £4m in FY08, plus £20m already committed

Special contributions of £24m p.a. for FY09 and FY10

Next formal review in three yearsNext formal review in three years’’ time time

23

Property UpdateProperty Update

Rigorous review of different ways to release

additional value from property

Preferred option was JV transaction and R20 was

most competitive bidder

Debt market crisis in July prevented implementation

Valuation gap still exists

Actively looking at options to realise objective as

soon as debt markets permit

Revisiting merits and feasibility of a REIT

Aim to access property upside for shareholdersAim to access property upside for shareholders

24

Property ValuationProperty Valuation

Property value of £5bn in year end accounts

Revaluation of freehold / long leasehold properties up £1.1bn

Aggregate value of individual pubs – not portfolio

Plan to revalue each year on a rolling basis

Alternative valuation based on PropCo structure

Freehold / long leasehold properties alone worth £4.8bn*

Based on yield of 5.8% on £280m of rent

Excludes value of OpCo – c.£200m underlying EBITDA for

FY07

Valuation upside from high quality estateValuation upside from high quality estate

* Before any purchaser’s costs

25

DividendsDividends

Ordinary Dividend

Final: 10.0p, up 16.3%

Total: 14.25p, up 16.3%

Special Dividend

£1 per share in Oct 2006

Maintain progressive policy for dividendsMaintain progressive policy for dividends

26

SummarySummary

Generating further value for shareholdersGenerating further value for shareholders

Good sales growth and operating margin result

On track for full uplifts from Acquired Sites in 2008/9

Achieving high returns on investment

Strong cash flows from trading and from disposals

Aim to release additional value from property

Dividend increase of 16.3%

27

Tim ClarkeTim Clarke

Chief ExecutiveChief Executive

Preliminary Results – 29 November 2007

28

Year of Strong GrowthYear of Strong Growth

Fourth year of strong growth: EPS 2003-07 up 105%

Value and volume strategy driving market share gains

Format innovation delivering high returns

Productivity, purchasing and efficiency gains

Rapid conversion of Acquired Sites

Strengthened competitive positionStrengthened competitive position

29

Operational StrategyOperational Strategy

Tightening consumer environment

Rapid response to changing market conditions

Reinforcing value and volume strategy

Gearing up roll-out of category killer formats

Pubs & Bars

Sustained volume driven growth

Rapid food growth and drinks share gains

Restaurants

Enhancing value and quality of winter menus

Initial sharp upturn in volumes in November

Sustainable, volume driven profitabilitySustainable, volume driven profitability

30

Profitable Market Share GainsProfitable Market Share Gains

(1) Same outlet like-for-like growth

(2) MAB estimates based on BBPA/AC Neilsen/ONS

MAB Estimated

Volume Growth (1) Market Volume Growth (2)

Food 6% 3%

Wine & Soft Drinks 1% -2%

Spirits -1% -4%

Beer & Cider 0% -4%

31

Sales MixSales Mix

Increasing exposure to growth categoriesIncreasing exposure to growth categories

Note: Managed Sales

Food

Beer & Cider

Spirits

Wines & Soft

Drinks

Accom &

Other

Machines

37%

31%

13%

11%

5%3%

32

Divergent Disposable Income TrendsDivergent Disposable Income Trends

Low paid/

unemployed

Skilled

blue collar

Mainstream

suburban

Professionals/

managerial

Socio/

Economic grp

Tax credits/

welfare

Full

employment

Interest rates/

stealth taxes

Strong earnings

growth

Economic

position

4%25%44%27%MAB estate

segmentation

+3.5%

+3.8%

31%

+3.0%+6.6%+5.6%ONS inflation

rates by social

group

+3.0%+2.6%+4.3%Earnings growth

13%38%17%% of UK

Households

Source: MAB estimates from current ONS and Family Spending Survey data

(1.3)% (4.0)% +0.3% 0.0%

33

Profitable Food Sales GrowthProfitable Food Sales Growth

High sales sensitivity to customer value perceptions

High price elasticity in mid/lower affluence segments

Rising menu quality expectations in higher affluence segments

Customer buying behaviours different by occasion

Daytime / early evenings – value and speed

Later evenings / weekends – quality and service

Attracting higher food volumes

Generates high margin drinks sales

Low marginal employment costs

High GP drop through to operating margin

Revenue investment in quality and valueRevenue investment in quality and value

34

Retail PriceRetail Price

Value positioning to drive market share gainsValue positioning to drive market share gains

Note: Includes the Acquired sites

Drinks Food

2

3

LFL Price

1

4

+2.6%

+3.4%

1

+0.8%

+1.6%

-0.8%

-2.4%

Mix/Range

LFL Price

Mix/Range

LFL Price

Avera

ge R

eta

il P

rice (

%)

35

High Food Volumes at Pub& Company Level

107 million meals per annum107 million meals per annum

* Excludes the Acquired Sites

Like-for-like food sales up 5.1%*

Average weekly food sales £6,800: +12%

Average number of meals served per week: 1070: +15%

Total food sales £684m: +22%

36

Source: Menurama

PREMIUM MID-MARKET VALUE

Average Price of a Main Meal (£s)Average Price of a Main Meal (£s)

Value for money in all market segments

37

The Value and Volume ModelThe Value and Volume Model

Pub & Carvery example

2004 2007

Average spend per head £4.71 £4.01 -15%

Average meal volumes per pub per week 1,800 2,950 +64%

Price elasticity >4 times

42% drinks sales mix

Ave profit per pub +29%

Very attractive profitable volume growthVery attractive profitable volume growth

38

0.8

0.85

0.9

0.95

1

1.05

1.1

Mar

-03

Jun-

03Sep

-03

Dec

-03

Mar

-04

Jun-

04Sep

-04

Dec

-04

Mar

-05

Jun-

05Sep

-05

Dec

-05

Mar

-06

Jun-

06Sep

-06

Dec

-06

Mar

-07

Jun-

07Sep

-07

Dec

-07

Mar

-08

Gaining share in declining on-tradeGaining share in declining on-tradebeer marketbeer market

Sustainable profitability from market share gainsSustainable profitability from market share gains

Source: BBPA: * Excludes MAB Volume: ** MAB same outlet volumes to October 2007

Off-trade volume

On-trade volume*

MAB volume**

MAT Beer Volume

39

+8% +8% +14% -1%Price change:

FY03 to FY07

Drinks Price GapDrinks Price Gap

Source: AC Neilsen

Balancing short profitability with long term share gainsBalancing short profitability with long term share gains

Average Price per Pint of Standard Lager - FY07

£0.73

£2.48£2.27£2.12

£0.00

£0.50

£1.00

£1.50

£2.00

£2.50

£3.00

MAB Managed Leased Supermarkets

40

Wine, Soft Drinks and CoffeeWine, Soft Drinks and Coffee

Wine

Sales volumes +3%

Draught dispense in 600 pubs

Own label

Soft Drinks

Sales volumes flat

Fresh juices +4%

Draught carbonates +1%

Packaged carbonates & mixers -5%

Coffee

Sales volumes +23%

c.1,200 coffee machines installed

41

Efficiency Gains

Productivity

Rapid growth in staff contribution per hour: +3.9%*

Enhancement of scheduling system

Purchasing

COGS index increases held to under 1%

£7m of purchasing synergies from acquisition

Infrastructure efficiencies

Current year rationalisation process underway

£7m of annualised cost savings to be delivered in 08/09

year

Scale efficiencies underpin value and volume strategyScale efficiencies underpin value and volume strategy

* Excluding the Acquired Sites

42

Residential Pub RestaurantsResidential Pub Restaurants

Suburban Pub Restaurants

Good growth in Harvester,

Toby, Pub & Carvery

Commuter Belt Pub Restaurants

Decline in Vintage Inns

New competitive capacity

Mid market slow-down in

disposable incomes

Same outlet like-for-likes +0.7%Same outlet like-for-likes +0.7%

Toby Carvery, Banbury

The Hedgehog, Vintage Inns, Lichfield

43

Pub Restaurants Margin Reinvestment

Plan to reinvest c.2% of food margin in quality and value

Concentrated in:

Vintage Inns menu quality

Harvester and Toby value and quality

Pub Carvery value

Introduced at end October: Dark Nights menus

Strong growth upswing in November

In all cases generating:

Higher main meals cash GP

Incremental starters / desserts and drinks

Staff productivity gains

Higher net operating profit

Margin reinvestment to drive Pub RestaurantsMargin reinvestment to drive Pub Restaurants’’ profitability profitability

44

Pub Restaurants Pub Restaurants –– Acquired Sites Acquired Sites

Rapid integration process

172 sites converted to date

9 Franchised

15 disposed on premium multiples

Remaining conversions to be

completed in first half

Outstanding site quality

Speed of integration delivers growth platformSpeed of integration delivers growth platform

The Scotsbridge Mill, Premium Country Dining, Rickmansworth

45

Pub Restaurants Pub Restaurants –– Acquired Sites Acquired Sites

Initial sales uplifts of c.20%

Residential sites strongly ahead

Poor Summer impacted destination sites

Post conversion sales build up

Strongest uplifts:

Limited change in customer profile

Overtness of branding

Strong value offer

Post conversion focus:

Productivity

Operating margins

Confident in delivery of 08/09 year targetsConfident in delivery of 08/09 year targets

The Oakmere, Harvester, Potters Bar

46

Residential PubsResidential Pubs

Widening drinks market share gains

Repositioning to food: 21% sales mix

Food sales up 16%

High returns from c.70 conversions

Rapid expansion in Sizzling Pub Co,

Cornerstone and Metro Professional

Exited pubs with limited food potential

The Travellers Rest, Sizzling Pub Co, Reading

Merry Hill, Cornerstone, Wolverhampton

Same outlet like-for-likes +6.3%Same outlet like-for-likes +6.3%

47

High Street & City Centre MarketsHigh Street & City Centre Markets

25% of sales

Strong format portfolio

Successful evolution of

O’Neill’s, Scream & Town Pubs

Central London buoyant:

All Bar One, Nicholson’s

Rapid food growth

Breakfast and coffee

opportunity

Same outlet like-for-like sales growth +3.0%Same outlet like-for-like sales growth +3.0%

Clachan,

Nicholson’s,

London

The Queen of Hearts, Scream, Manchester

48

Estate DevelopmentEstate Development

c.100 conversions including remaining Acquired Sites

6 to 8 new build, high take, super-pubs

Increasing focus on category killer, value formats

Rapid expansion of Sizzling Pub Co, Pub Carvery, Cornerstone

Over 50 to be opened this year

c.300 pubs, over 15% of the total estate by end 2008

Average sales uplifts of £7k per week

High returns from estate repositioning toHigh returns from estate repositioning to

highest growth segmentshighest growth segments

49

Smoking BanSmoking Ban

2nd year strong growth in Scotland2nd year strong growth in Scotland

Initial post ban slowdown in EnglandInitial post ban slowdown in England

2.2%

0.4%

3.2%

4.0%

6.7%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

Ban to

end FY06

FY 07 wks

1-16

FY 07 wks

17-32

FY 07 wks

33-52

FY08 1-

7wks

Scottish like-for-like sales since ban

50

Current TradingCurrent Trading

Same outlet like-for-likes up 1.4% in first seven weeks

Same outlet like-for-likes up 2.4% in November

Positive impact of new menus and pricing actions in Restaurants

Pubs & Bars accelerating drinks share gains & food sales growth

Remaining Acquired Sites to close for conversion

Out-performance in a more challenging market conditionsOut-performance in a more challenging market conditions

Stronger NovemberStronger November

51

OutlookOutlook

Uncertain consumer outlook

First winter of smoking ban impact

Resilience against on-trade declines

Positive consumer response to Restaurants’ sales actions

Power of MAB format portfolio

Focus on top line growth from managed super-pubs

Intensifying value and volume model

Attractive strategy for scale operator with high takes

Accelerating share gains amidst challenging trading conditionsAccelerating share gains amidst challenging trading conditions

52

Property and StrategyProperty and Strategy

Overriding commitment to shareholder value

Unlocking the embedded value of the estate

Higher valuations placed by dedicated property investors

Best sites, formats and operational skills

Key is mutual incentives for property and operations in lease

arrangement

Equity growth case for both property and operationsEquity growth case for both property and operations

53

SummarySummary

Out-performing amidst tougher conditions

Formats positioned to growth segments

Scale advantages in value driven markets

Operational excellence, cost efficiency

Consolidation opportunities

Property: reviewing options for unlocking value

Focus on sustainable shareholder valueFocus on sustainable shareholder value

Questions & AnswersQuestions & Answers

Preliminary Results – 29 November 2007