Mitie Shareholders Show Dissatisfaction Following Accounting Error

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LONDON (Alliance News) - Mitie Group PLC said all of the resolutions put forward to shareholders at the annual general meeting on Wednesday passed, but said three of them saw a large number of votes cast against them.

Mitie said "a high number of votes" were cast against the resolutions related to directors' authority to allot shares, the general authority to dis-apply pre-emption rights, and against resolution 15, which sought additional authority to disapply pre-emption rights in connection with the financing of an acquisition or specified capital investment, limited to the equivalent of 5% of Mitie's issued share capital.

Of the votes cast, a third went against the resolution to provide the authority to issue shares, 23.18% went against the resolution concerning the general authority to dis-apply pre-emption rights, and resolution 15 saw 20.25% of the votes cast go against the proposal.

"A process of shareholder consultation has commenced, and Mitie will continue to engage with those shareholders who either withheld their vote, or voted against these resolutions, to improve understanding and, if possible, allay any such concerns for the future," said the company.

"Mitie further acknowledges that resolution 10, in relation to the reappointment of Deloitte LLP as external auditor, was passed but with a high number of votes received against it, as well as withheld. Mitie has announced that it is undertaking a tender process during July, August and September 2017, and will announce a new external auditor in due course," Mitie added.

Shares equal to 29.39% of Mitie's issued share capital withheld voting on the resolution concerning the auditor.

Notably, of the votes cast, 7.93% voted against approving the renumeration report, 13.22% voted against reappointing Chief Financial Officer Larry Hirst to the board, and 11.96% voted against the company's authority to call meetings at short notice.

The rebellion against Hirst is notable, but 9.94% of votes cast also went against the re-election of Non-Executive Mark Reckitt.

The AGM came after the company reported annual results in June covering the 12 months to the end of March 2017, when it turned to a pretax loss of GBP42.9 million from a profit of GBP107.6 million the previous year.

The company said this was due to a one-off adjustment from an accounting review carried out by KPMG, which found GBP60.5 million worth of errors in the period before March 2017, with the net impact of prior year adjustments for 2016 coming to GBP20.9 million.

Mitie shares were down 0.2% on Wednesday at 261.70 pence.

By Joshua Warner; [email protected]; @JoshAlliance

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