Statement re extension of First ScotRail franchise

FIRSTGROUP PLC STATEMENT RE: EXTENSION OF FIRST SCOTRAIL FRANCHISE       

FirstGroup plc, the UK's leading transport company, today welcomed the
announcement by the Scottish Government that the First ScotRail franchise will
be extended for three years to November 2014.

Commenting on the franchise extension, Moir Lockhead, Group Chief Executive
said: "We are delighted that the Scottish Government has taken the decision to
extend the First ScotRail franchise for three years.

"Since the start of the franchise in October 2004 we have invested more than £
25m in Scotland's railway. More and more people are choosing rail as their
preferred means of travel. The number of passengers using First ScotRail
services has grown by 19% and performance has improved significantly with
delays caused by First ScotRail reduced by 50%.

"Our First ScotRail staff, led by Mary Dickson and her team, work hard to
deliver excellent customer service. First ScotRail's commitment to deliver the
best service for Scotland every day has driven a programme of continuous
improvement and led to this franchise extension."

The agreement creates an investment fund of more than £70m, for control by
Transport Scotland, to further improve Scotland's railway. This has been
achieved by converting future estimated revenue share payments into an
investment fund, in return for a change in First ScotRail's revenue share and
support arrangements.

The revenue share and support arrangements have been amended to further
incentivise First ScotRail to continue to grow passenger revenue. The fund can
be used for additional train services, to improve journey times, connections
and quality of services which will bring direct passenger benefits.

Moir Lockhead continued: "This is an exciting time for rail passengers in
Scotland with a number of major projects underway including Airdrie-Bathgate
services and the Glasgow Airport Rail Link.

"The franchise extension also means that First ScotRail will be operating
Scotland's railway during the Commonwealth Games in 2014."

Notes to editors

 1. FirstGroup was awarded the ScotRail franchise on 20 August 2004.
   
 2. The First ScotRail franchise officially commenced on 17 October 2004.
   
 3. The initial franchise was awarded for seven years with specified
    performance targets and a possible three year extension available.
   
 4. The First ScotRail franchise is one of the largest in the UK with more than
    2000 trains a day and 79 million passenger journeys a year.
   
 5. The revenue share and support arrangements have been changed to reflect
    current revenue levels and the trigger levels have been widened as follows:
   
 a. The 50% share and support trigger level has increased from 2% to 10% of
    revenue; and
   
 b. The 80% share and support trigger level has increased from 6% to 14% of
    revenue.
   
 6. The agreement introduces a profit sharing mechanism which will make a share
    of profit in excess of targets available for re-investment in services.
   
Contacts:

Nick Chevis, Group Finance Director

Stuart Bugg, Corporate Communications Manager

Tel: [phone]