Trading Statement

Embargoed until 7:00am on Tuesday 30 September 2008

                                FIRSTGROUP PLC                                 

                                TRADING UPDATE                                 

FirstGroup plc ("the Group") reports on trading for the six months to 30
September 2008 ahead of a series of pre-close meetings to be held with analysts
this week.

The Group provided an update on trading as part of its AGM and Interim
Management Statement on 10 July 2008. Overall trading performance since then
has continued to be positive and we expect to announce half-year results, for
the six months to 30 September 2008, in line with management expectations.

Our UK Bus division is performing ahead of our expectations and has delivered
another very strong performance. Like-for-like passenger revenue increased by
7.5% with passenger volumes also increased during the period as growing numbers
of passengers switch to the bus from other modes of transport.

We continue to promote bus travel and this summer we launched our "Fuel for
Thought" campaign to highlight the competitive advantage of bus travel compared
to the cost of filling a car with petrol. We also launched our FuelBuster
ticket, a new product allowing our passengers to fix their travel costs for a
six month period. Our strategy is to encourage growth and to support
partnerships with local authorities across the UK through targeted investment
in new vehicles.

Like-for-like UK Rail revenue growth for the period remained strong at 9.8%.
Overall passenger volume growth supports the view that customers are being
attracted to rail services as a result of the increasing costs of motoring. In
the current uncertain economic climate we continue to closely monitor the
performance of our rail businesses for changing patterns of customer behaviour.

We continue to deliver strong revenue growth across all of our rail businesses.
At First Capital Connect, which has a high proportion of central London
commuter customers, the rate of strong growth slowed marginally during the last
month of Q2 but is still delivering a robust performance of over 8% revenue
growth. Across our Rail division we have a diverse range of franchises
including London commuter, intercity and regional, providing a balanced mix of
operations and mitigating reliance on any one specific market.

In North America we are pleased with the continued success of our enlarged
operations and enjoyed a successful start up of new and retained business for
the new school year, which commenced in August and September. We remain on
track to deliver $150m per annum of synergies from the beginning of the new
financial year in April 2009. Our scale enables us to offer enhanced quality
and value to customers and we continue to pursue the opportunities that the
current economic climate in the US presents for us to expand our business and
our product offering. During the period we were pleased to win a number of
conversion contracts, outsourced from the public sector, to operate over 360
new school buses.

At Greyhound we are pleased to report that like-for-like revenue growth was 5%
demonstrating the continued success of our initiatives to increase revenue,
manage controllable costs tightly and grow our share of new, attractive
markets. We have placed an order for 140 new vehicles for Greyhound as part of
our plans to improve the quality and performance of the fleet. BoltBus, our
recently launched low cost, high quality intercity coach service operating
between key cities on the east coast, is already achieving revenues of over $1m
per month and strong demand for services has resulted in high capacity
utilisation.

Fuel, while a continued cost pressure, accounts for approximately 10% of our
total costs in UK Bus and North America and less than 5% in our UK Rail
business. We continually review and closely manage our business to ensure that
we are operating as efficiently as possible. The Group is 100% hedged in
respect of its fuel requirement for the remainder of this year at $76 per
barrel for the UK and $84 per barrel for North America. For the trading year
2009/10 the Group has increased the hedged proportion of its UK requirement to
90% at approximately $111 per barrel and 85% of the North America requirement
at approximately $118 per barrel.

We are pleased to report further progress in our strategy to replace the
shorter-dated Laidlaw acquisition debt in line with our refinancing programme.
Earlier this month we announced the successful issue of £300m 10-year bonds.
The Group has arranged for the proceeds to be initially swapped into fixed-rate
US dollars at 6.9%. We have now repaid $1.45bn of the $2.25bn Laidlaw
acquisition term loan from the proceeds of the recent bond issue and from the
equity placing and new medium term loans raised in May 2008. We are making good
progress with our programme to replace the remaining $800m of the acquisition
term loan which matures in February 2010.

We are encouraged by the Group's continued strong trading performance. As the
largest operator of bus and rail services in the UK, with a diverse spread of
operations, the Group is placed to benefit from continued modal shift towards
public transport from other modes of travel. While the Group is not immune to
macroeconomic developments and the impact of continued cost pressures, it has a
strong, well balanced portfolio of operations, with approximately 50% of Group
revenues secured under medium-term contracts with Government agencies and other
large organisations in the UK and North America. With excellent prospects for
growth in all our markets the outlook remains positive.

Like-for-like revenue growth as reported is derived, on a constant currency
basis, by comparing revenue during the period with the equivalent prior year
period.

Contacts FirstGroup plc:

Nick Chevis

Acting Finance Director

Tel: [phone]

Rachael Borthwick

Group Corporate Communications Director

Tel: [phone] or 07771 945432