Update on Strategy Review

The review has so far resulted in the board implementing a number of important managerial and operational changes at both a group and divisional level. Much has been done to simplify the company, and disposals have taken place to allow greater focus on the core businesses. The company reported on 15 April on several disposals as well as new contract awards. The review went into a second, operational and strategic, phase in March and is not yet complete.

Good progress is being made in the rail division. In particular, the board is pleased with the great improvement in the relationship between Jarvis and Network Rail; the company is fully engaged at a high level with Network Rail on important issues. The confirmation of significant renewal work for Jarvis, which has about a third of national renewals work, was welcome.

The company is also considering how best to maximise the long-term value from its investment in Tube Lines Ltd.

Among other issues, the review is addressing how to improve the performance of the accommodation services division; so far, the division has been reorganised, costs have been reduced significantly and decisions taken to bid for future projects on a more conservative basis. The board is pleased with the recent contracts where Jarvis has been announced as preferred bidder.

As certain of the group’s banking facilities expire from March 2005, the board has started discussions for their renewal. The board is also mindful that material change to the group’s current strategy and position may require the consent of the group’s lenders, and therefore lenders are being kept informed of the progress of the review. Jarvis continues to operate within its current facilities.

Jarvis now anticipates that the review is likely to be concluded during July, at which time the group will release its results for the year ended 31 March 2004 and provide a full update on the board’s proposed strategy for the group.

Enquiries:

Jarvis	020 7462 4646
Jonathan Haslam, Communications Director
Tulchan	020 7353 4200
Andrew Honnor
David Trenchard

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