AGM and Interim Management Statement

The Board set out its objectives for the strategic repositioning of the Group at last year’s AGM and the targets underpinning the delivery of this strategy continue to be met.

Consent for the termination of the three significantly loss-making facilities management contracts, announced on 4 June 2007, has been agreed with the relevant local authority committees and responsibilities will transfer to the new service providers in August. Following the termination of these contracts the overall facilities management business will be profitable at the contract level.

The programme of cost savings has commenced following successful completion of the Placing and Open Offer and is progressing in line with management expectations.

Jarvis Rail Limited and Fastline Limited have announced contract awards of £50m and £40m respectively in recent weeks. Fastline Limited’s contract award from E.ON UK Plc is a significant step in the development of its freight business and commences in April 2008.

The Jarvis Rail contract awards demonstrate the anticipated pick-up in workload as reported in the preliminary results statement on 12 June 2007. The impact of the increased workload is expected to be fully seen in the second half of the financial year.

Network Rail has delayed their decision on the four successful track renewal contractors, originally scheduled for August, until September. Our rail business continues to perform well on the key performance indicators on which we understand the decision will largely be based.

Trading results for the first quarter have been in line with our expectations and we continue to focus on achieving the remaining announced strategic objectives to complete our business recovery.

For further information please contact:
Toni Jackson – Group Communications Manager
T: 01904 712 667 M: 07921 939 031

Isabel Podda, Buchanan Communications
T: 020 74665119 M: 07899 790431


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