Final Results

FirstGroup PLC
15 May 2001



PART 1

                               FIRSTGROUP  PLC
            PRELIMINARY RESULTS FOR THE YEAR TO 31 MARCH 2001

HIGHLIGHTS

*        Further increases in turnover, profit and cash flow

*        Focus on core businesses enhanced

*        Successful disposal of New World First Holdings and Bristol
         International Airport

*        Rail portfolio strengthened through re-negotiation of First North
         Western franchise

*        North America outperforms acquisition plan

*        US school bus business growing at 10% per annum

*        Total UK Bus volumes up by over 1%


         Turnover £2,054m                          up 14%
         Profit before tax £136.8m                 up 13%
         Net dividend per share 9.4p               up 11%
         Cash generation £307m*                    up 18%
         Adjusted basic earnings per share 28.9p
         Net debt reduced by £119m to £661m

Commenting, FirstGroup's Chief Executive, Moir Lockhead said:
'This has been a year of achievement. We have delivered on our strategy and
the Group is now focused on its three core businesses. North American
operations have outperformed expectations, our UK rail business has achieved
strong results despite the aftermath of Hatfield and our UK bus operation has
seen its third year of volume growth. We have reduced debt by over £100m in
the year and this puts us in a strong position to develop new opportunities
and where appropriate to further reduce debt and buy back equity. Despite the
more uncertain economic outlook, I believe our companies are well placed to
grow on both sides of the Atlantic, and I remain confident about the prospects
for the Group.'

* Group operating profit before ESOP, goodwill and restructuring and other
  exceptional costs, plus depreciation

Enquiries:
FirstGroup plc
Moir Lockhead, Group Chief Executive                Tel: [phone]
Iain Lanaghan, Group Finance Director               Tel: [phone]
Michael Mitchell, Corporate Communications Director Tel: [phone]

Chairman's Statement

Safety remains our highest priority especially as this year has not been
without problems on the railways. The accidents at Hatfield and Selby once
again put the focus on rail safety. I am joined by the Board of FirstGroup and
all of our employees in expressing our deepest sympathy to the injured and
bereaved in these tragic accidents. We have good safety systems in place and
continue to work closely with DuPont Safety Resources. We strive to improve
our performance wherever possible and to develop programmes to ensure that a
culture of safety is embedded in everything that we do.

This has been a year of achievement for the Group. Turnover has increased by
14% to £2,054m and profit before tax increased by 13% to £136.8m. We have
successfully progressed our strategy to focus on our three core businesses -
UK Bus, UK Rail and North America. We have sold our interest in Hong Kong for
£38.7 million, a profit of £13.8 million, and our 51% stake in Bristol
International Airport for £107.1 million, a profit of  £55.6 million.  We
successfully re-negotiated the terms of First North Western's rail franchise
which will relieve the Group of substantial losses to 2004 at a cost of £37m.
All three transactions will enhance the Group's earnings and improve our
portfolio of businesses. In North America we have expanded our sphere of
operations with the acquisition of Hertz Bus Group in Canada.

The steps taken by Railtrack in the immediate aftermath of the Hatfield
accident highlighted major shortcomings in their management and maintenance of
the railway infrastructure. We are deeply concerned that our passengers have
suffered, and are still suffering from, delays and disruption to their
journeys. We will pursue Railtrack for full compensation for the losses which
have been incurred. We will also press Railtrack to complete the remedial work
on the network as quickly as possible so that we can restore the full
timetable service for our passengers.

We take very seriously our responsibility to the communities in which we
operate to ensure that we manage environmental issues carefully. We have
pioneered environmental reporting within our sector and we work closely with
agencies to ensure that we maintain the highest standards of best practice
throughout our businesses. Companies within our Group are encouraged to obtain
ISO14001 accreditation for their environmental management systems.

People are our strongest asset. We lead the industry in our comprehensive
customer and employee research and use the feedback to shape our business
going forward. During the year Andrew Higginson retired from the Board as a
non-executive director and I would like to thank him for his contribution to
the Group.

The Group is now strongly positioned to continue its profitable expansion in
the international transport industry. We believe that there are major
opportunities to grow our business in North America. In the UK we are a strong
contender in rail re-franchising and we have the best urban bus portfolio with
potential for growth as new schemes to reduce congestion are developed by
Local Authorities in line with Government objectives.  I believe the outlook
for FirstGroup is strong and I look forward to the further growth of the
business in the next 12 months

Martin Gilbert
Chairman


Chief Executive's Review

Safety

Safety continues to be our number one priority and we are working on new
initiatives to further develop the safety culture among all of our staff. In
our rail operations we were pleased to be the first inter city rail company to
introduce airline style safety cards and safety announcements for passengers
on our First Great Western trains. In a further effort to improve standards of
best practice we carried out a full scale train evacuation test to evaluate
our current safety procedures.  Among our employees we are introducing
programmes to help create a 'zero tolerance' culture for accidents and safety
issues in the workplace. We are carrying out a series of safety training
workshops for staff and, in addition, we are introducing a comprehensive
employee communications programme to keep safety at the forefront of
everybody's mind and share best practice throughout the Group.

Results

I am pleased to report another successful year for the Group. Operating
profit, before ESOP, goodwill, restructuring and other exceptional costs, rose
to £218.5m, an increase of 14% (2000: £190.9m). Group profit before tax
increased by 13% to £136.8m (2000: £121.5m). Underlying earnings per share
(before goodwill amortisation, restructuring and exceptional costs and
property profits) rose to 28.9p (2000: 28.3p) an increase of 2%, reflecting
the full impact of the increased number of shares in issue following the
rights issue in September 1999.  The Board has recommended a final dividend of
6.4p giving a total for the year of 9.4p per share (2000: 8.5p), an increase
of 11%. The dividend is covered 2.3 times and will be paid on 24 August 2001
to shareholders on the register on 27 July 2001.

Strategy

Our strategy remains to increase value for shareholders through the focused
development of FirstGroup as an international public transport leader. In line
with this strategy the Group disposed of two non-core operations during the
year. The disposal of both New World First Holdings in May 2000 and Bristol
International Airport in January 2001 produced substantial profits for
shareholders and has enabled the Group to strengthen the focus on its core
operations of UK bus, UK rail and in North America, student transportation,
transit management and vehicle maintenance.

The scale of the US market offers excellent opportunities for growth. The
combined market for  Student, Transit and Vehicle Maintenance is estimated at
some $25 billion and as the most cost effective operator we are in a very
strong position to grow rapidly.

Public Transport remains a high priority for the UK Government. The 10-year
Transport Plan envisages spending of £60 billion on railways and £59 billion
on local transport initiatives. To achieve these objectives the Government has
targeted a significant investment from the private sector and we believe that
FirstGroup has an important role to play in helping to deliver these
aspirations. In the Local Transport Plans unveiled by the Government in
December over £100m of infrastructure investment by Local Authorities was
authorised for towns and cities in which we operate bus services. This
investment will provide a further boost for public transport and enable us to
provide an enhanced level of service and reliability for our passengers.

Operating Review

UK Bus

Turnover increased by 6% to £788.6m (2000: £744.3m) and operating profits were
£105.0m (2000: £111.4m). The decrease in operating profit and margin is
largely due to continued cost pressures, particularly labour, and a number of
one-off items including industrial action in Manchester in the first half of
the year.  We estimate that total passenger volumes have increased by over 1%
in the year.  We continue to see encouraging growth in passenger volumes in
urban areas where we have rolled out 'Overground' and 'Metro' networks (the
Group's simplified route and fares structures). Currently the programme has
been introduced in Glasgow, Bradford, Leeds, Doncaster, Sheffield, Leicester,
Southampton, Weymouth, Aberdeen and Edinburgh. Over the next 12 months we will
extend coverage to include Manchester, Rotherham, York, Chelmsford, Norwich,
Bristol, Northampton, Huddersfield and Halifax.

Cost pressures, particularly payroll, remain an issue. In London and the south
of England driver turnover continues at higher levels than we would wish,
although we have seen some improvement during the last 12 months and our
driver shortfall now represents less than 3% of our total requirement. We are
focusing our efforts to ensure that we improve driver retention and are
putting in place new recruitment and training procedures. Going forward we
have negotiated a four year fuel hedge which will cap our exposure to fuel
price increases whilst allowing us to retain the benefit of any weakness in
oil prices over the period.

During 2000 we added 760 vehicles to the fleet including 35 bendi buses and
481 state of the art single and double deck vehicles which all meet the latest
standards for safety, accessibility and emissions. Our average fleet age is
now approximately 8 years, in line with Government targets. We expect future
capital expenditure will maintain the age profile of our fleet.  As part of
FirstGroup's drive to improve efficiency within the bus division we are
trialling innovative new arrangements with Volvo Bus Ltd for the maintenance
and management of our fleets in Bradford and Aberdeen. The contracts which are
initially for a 7-year duration include the provision of approximately 160 new
buses and every aspect of the servicing and maintenance of the fleets, as well
as the operation of workshop facilities.

The Group retains its strong belief that the bus has a major part to play in
the revival of urban transportation systems. Much has been written about the
advantages of tram and light rail systems and we are actively involved in a
number of projects including Manchester, Bristol, Leeds, Dublin and South
Hampshire light rail proposals. However, we believe that bus based solutions
still have much to recommend them in terms of financial viability, operational
flexibility and speed of implementation.  In Leeds it is pleasing to note that
the original guided busway corridor is now carrying around 75% more passengers
than it did in 1995 when the system opened. Relative to the rest of Leeds the
corridor is now carrying 100% more passengers, with no sign of this growth
slowing down. New guided bus schemes are being built in Leeds and Bradford.

The Group's smartcard scheme in Bradford already has over 20,000 participants.
The smartcard offers greater convenience and flexibility for passengers and
helps to speed up boarding time enabling us to improve service reliability.
Further initiatives are planned with our joint venture partner Prepayment
Cards Limited (PCL) later this year.

In February the Group was delighted to receive the endorsement of Government
for our pilot project to introduce American style yellow school buses to the
UK. We estimate that this new market could be worth over £200m per annum.  We
will shortly be placing an order for right-hand drive vehicles for use with a
number of schools and local authorities who have expressed interest in the new
service.

UK Rail

Turnover in the Group's three train operating companies was £761.2m  (2000: £
767.4m). The decrease in turnover reflects the reduction in passenger volumes
resulting from the extensive disruption to the national rail network,
following the imposition of emergency speed restrictions by Railtrack, in the
wake of the accident at Hatfield in October 2000. Operating profit was £56.2m
(2000: £46.2m) an increase of 22%

In the first six months of this year, up until the Hatfield accident,
passenger volumes had been increasing at the rate of 7.5% overall for our
three rail franchises, with passenger income increasing by 9% in First Great
Western, 7.3% in First Great Eastern and 7% in First North Western. However,
passenger revenues were severely impacted by the disruption to the network. We
believe that growth in passenger volumes will resume once the network is
restored to full working capacity and timetables are reinstated. In the
meantime we have seen a good recovery in our commuter traffic at First Great
Eastern and, during March and April this year, we had a very successful
off-peak fares promotion at First Great Western which has helped to encourage
passengers back to the railway.

Until the Hatfield accident, performance in all three of our train operating
companies was excellent. Both First Great Eastern and First Great Western were
top of their respective classes in the SRA performance tables. Since then the
varying impact of engineering works on different parts of the network has made
it difficult to measure the performance of individual operators. We were
delighted that First Great Eastern was voted Best Commuter Rail Operator of
the Year in the Rail Industry Awards at the end of last year, and that our
Managing Directors at First Great Eastern and First North Western both
achieved major industry awards for their contribution to rail management.

In March 2001 we signed a Deed of Amendment to the First North Western trains
franchise.  Under the terms of this agreement substantial losses which were
expected to be incurred until the end of the franchise in 2004 will be
avoided. The amendment to the franchise will improve the quality of
FirstGroup's earnings and enable us to develop our proposals for new rail
franchises in the region, where we are currently shortlisted for the
TransPennine Express franchise (in conjunction with Via GTI a subsidiary of
SNCF) and the Wales and Borders franchise.

On First Great Western we have been invited by the SRA to put forward
proposals for a 2-year extension to the franchise to 2008. In addition, we are
currently developing proposals in line with the SRA's strategic plan to
rationalise the number of operators into London's Liverpool Street and
Paddington stations. We are also bidding for the Wessex franchise which is
adjacent to our First Great Western franchise. We believe we can offer
significant improvements to train service capacity in the new franchise region
and, as the largest operator of buses in the area, we can offer further
opportunities for transport integration.

During the year, delivery commenced of part of the fleet of 70 new class 175
trains for First North Western. These trains have provided a step change in
the levels of comfort on the lines where they have been introduced. A further
70 new class 180 'Adelante' 125mph trains will enter service on First Great
Western later this year.  In addition we have now ordered 21 new class 360 '
Desiro' units to replace the last of the slam-door rolling stock at First
Great Eastern. These four-car units will provide a much improved passenger
environment for commuters into Liverpool Street.

North America

FirstGroup America comprises three separate operations; First Student - school
bus operations; First Transit - urban bus contracting and management; First
Vehicle Services - fleet maintenance services. In the period turnover was £
462.7m (period from 13 September 1999 to 31 March 2000: £246.4m) and operating
profit was £56.3m (period from 13 September 1999 to 31 March 2000: £34.5m).
This excellent performance, which is ahead of the budget set at the time of
acquisition, is due to strong growth in the school bus division where new
contracts representing over 600 additional new buses were operated from the
start of the new school year in September 2000 together with strong cost
control. During the year the management team has been reorganised and
strengthened with simplified reporting lines and a stronger focus on sales and
marketing. A key task over the first 12 months of FirstGroup's ownership was
the creation of stand alone accounting and administration systems. This has
been achieved within the original timescale set at acquisition. As a result of
the hard work of the management team in the US all systems have now been
successfully transferred. One-off costs of approximately £6m were incurred
mainly in connection with systems and pension advice.

First Student operates in the US and Canada and is the second largest operator
of school buses in the United States with currently over 13,000 vehicles,
carrying nearly a million students every day across 29 states in the US and
Canada. During the year we made our first entry in to the Canadian school bus
market with the purchase of the Hertz Group. Hertz is the third largest school
bus operator in Canada with some 735 buses operating in the province of
Saskatchewan. Brad Hertz, Chief Executive of Hertz Group, has joined our North
American management team with responsibility for operations in Canada and the
Northern United States. We also acquired Champion of Maine, a student
transportation company which operates 53 school buses in New England.

Expansion of our school bus operations has continued during the spring bidding
season and to date we have won net new contracts to operate over 1300 school
buses for the new term starting in Autumn 2001. This represents growth of
around 10%. This expansion will take us into a number of new states such as
Alaska, Florida and North Carolina where we have not previously operated, and
take our total school bus fleet to over 14,000 across 32 states.

First Transit has renewed or gained a number of important contracts during the
year including systems in Dallas, Los Angeles, other locations in California
and Alabama. First Vehicle Services has gained important new contracts
including locations in New York, Indiana and Virginia. Both First Transit and
First Vehicle Services operate in relatively under-developed markets which we
believe offer us significant scope for expansion.

Joint Ventures, Associates and Other

On 15 May last year the Group disposed of its 26% shareholding in New World
First Bus to the majority shareholder for £38.7m, giving a profit before tax
of £13.8m on our investment over the eighteen months since trading began.

In January 2001 we completed the sale of Bristol International Airport to
Macquarie Bank Group and Cintra Concessiones de Infrastructras de Transporte,
S.A. The Group received £130m for its 51% shareholding including repayment of
debt. Turnover for the period to the date of sale was £34.9m (2000: £31.3m)
and operating profit for the period to the date of the sale was £11.5m (2000:
£9.9m).  Whilst the airport continued to perform strongly and had grown
substantially since acquisition in 1997, the Group found itself unable to
build a portfolio of airport businesses at prices that would have been
earnings enhancing for shareholders. The sale of the airport reinforces our
focus on core business activities.

Croydon Tramlink is now fully operational and is carrying an estimated 16
million passengers per year making it the busiest tram system in the UK. In
Manchester the Group is a member of the Greater Manchester Rapid Transit
Consortium which has been shortlisted to take over operation of the Manchester
Metrolink system and to design, build and operate new lines to Oldham/Rochdale,
Manchester Airport and Ashton.

FirstInfo, the Group's information and e-commerce division, provides telephone
and internet based transport information services. A new service developed by
FirstInfo is FirstBus.co.uk - this is the first website to sell bus company
season tickets online, offering tickets from 10 FirstGroup bus companies.
TrainDirect.co.uk sells a range of FirstGroup train tickets and season tickets
on line. FirstInfo operates a centralised call centre in Plymouth, which
successfully re-bid for the Wales and West zone National Rail Enquiries
contract. The division has also won the contract to operate the South West
Region of the Government's Travel Line service, offering integrated transport
information over the telephone.

In an exciting new development FirstGroup and Railtrack Travel Ltd signed a
50:50 joint venture agreement in January 2001 to develop totaljourney.com, the
first integrated travel planning and booking service dedicated to the UK.
totaljourney will be launched in June from a unique position of strength.
500,000 customers (including 35,000 WAP-registered users) will be transferred
to the new online service from the Railtrack timetable site, the second most
popular travel site in the UK.

Outlook

The Group's strong financial position will enable us to develop new
opportunities in our core markets and other transport related activities.
Despite the more uncertain economic outlook, I believe our companies are well
placed to grow on both sides of the Atlantic, and I remain confident about the
prospects for the Group. Although it is early in the new financial year, I am
pleased to confirm that Group trading is in line with our expectations.

Moir Lockhead
Group Chief Executive
15 May 2001


Financial Review

Overall

Group turnover in the year increased by £258.9m, or 14.4%, to £2,054.0m.
Group operating profit, before ESOP, goodwill and one-off costs was £218.5m,
an increase of £27.6m.  This year's results include a full year of the North
America Division for the first time, against only 61/2 months last year.

Divisional Results
                      Year to 31 March 2001          Year to 31 March 2000
                            Operating  Operating           Operating  Operating
                              profit**   margin**           profit**  margin**
                  Turnover                       Turnover
                        £m         £m          %       £m         £m          %

UK Bus Division      788.6      105.0       13.3    744.3      111.4       15.0
North America        462.7       56.3       12.2    246.4       34.5       14.0
Division
Rail Division        761.2       56.2        7.4    767.4       46.2        6.0
Bristol               34.9       11.5       32.8     31.3        9.9       31.6
International
Airport
Other*                 6.6     (10.5)          -      5.7     (11.1)          -
Total Group        2,054.0      218.5       10.6  1,795.1      190.9       10.6

** Before ESOP, goodwill and restructuring and other exceptional costs
* Tram operations, central management, Group information technology, and other
  items

Revenue in the UK Bus division grew by £44.3m to £788.6m, or 4.1% after
allowing for an extra week's trading this year. The operating margin was
13.3%, reflecting both one-off items such as industrial action in Manchester
in the early part of the year and implementation costs of the Overground
network and more general cost pressures, particularly on drivers' wages.  The
Group was fully hedged on fuel during the year.  We have entered a further
hedge arrangement which caps our fuel costs for the four years to March 2005.

In its first full year, the North America division's turnover was £462.7m and
operating profit was £56.3m, a margin of 12.2%.  Whilst operating profit is up
£21.8m, the percentage margin is lower than last year because last year's
figures excluded the school summer holidays.  The increase in operating
profits includes £2.9m due to the weakening of Sterling against the Dollar
this year.

The Rail division operating profit was £56.2m, £10.0m higher than last year's
despite grant reductions of £22.7m.  Revenue was £6.2m below last year as a
result of the severe disruption to the UK rail network in the aftermath of the
Hatfield accident.  Prior to Hatfield passenger revenue was  up 9.4% on last
year.  Although some compensation has been received from Railtrack, further
claims will be made for unrecovered losses.

This year's results include the trade of Bristol International Airport up to
its disposal in January 2001.  The operating profit for that period was £11.5m.

Exceptional costs

Exceptional costs include a charge of £39.9m in connection with the agreement
to amend the First North Western franchise.  As a result of this, significant
losses to the end of the franchise in 2004 are avoided.  The £13.6m of other
items includes £6.1m in North America for restructuring and transition costs,
and £2.5m in respect of bringing new trains into service at First North
Western.

Joint Ventures and Associates

The Croydon trams commenced operation in May 2000.  Tram Operations Limited,
our 100% subsidiary that has the operating contract made an operating profit
of £0.7m.  Our share of operating loss of Tramtrack Croydon, the joint venture
that owns the track was £0.3m.  Our share of losses at totaljourney, our new
joint venture with Railtrack, was £0.5m and our total equity investment is
£5.5m.  totaljourney plans to launch its services this summer.  Our share of
losses at Prepayment Cards Limited, which is also in the start-up phase, was
£0.2m.

Goodwill amortisation

The overall goodwill charge this year was £27.8m, including £25.3m in North
America and £1.9m on joint ventures and associates.  The increase over last
year's £13.0m is mainly due to the full year effect of the North America
goodwill, and goodwill on joint ventures and associates that commenced this
year.

Interest

Net interest payable was £64.5m (2000: £44.0m).  This was covered 4.8 times by
cash generation.  The increase in the interest charge over the previous year
principally reflects the full year effect of the increased net debt following
the Ryder acquisition in September 1999.

Employee Share Ownership Plan (ESOP)

The charge for the ESOP represents 5% of profits earned in the UK.  The
appropriation of £4.2m (2000: £5.2m) will be shared among an estimated 26,000
eligible UK employees.

Acquisitions and disposals

On 18 December 2000 the Group acquired the Hertz Group in Canada for C$24.4m
(£10.9m) paid in cash.  The goodwill amounted to £8.0m, which is being
amortised over 20 years.

The Group's 51% stake in Bristol International Airport was sold on 24 January
2001 for net proceeds of £128.3m, including the repayment of Group loans.  The
pre-tax profit on disposal was £55.6m.

In May 2000, we sold our 26% interest in New World First Holdings to our joint
venture partners, New World Development Company, for HK$457m (£38.7m).  The
pre-tax profit on disposal was £13.8m.

Taxation

The overall tax charge for the year of £42.0m includes £21.8m in respect of
the Bristol International Airport and New World First Holdings disposals and £
2.5m tax relief on the exceptional costs.  Although the Group believes that
tax relief is available for the costs of obtaining and managing rail
franchises, no tax relief has been accrued in respect of the charge for the
First North Western franchise amendment. The effective rate on underlying
profits is 15.3%, which reflects the high level of capital expenditure in the
UK and the tax relief obtained in the US for goodwill amortisation.

Cash flow and investment in the business

Cash generation (operating profit, before ESOP, goodwill and one-off costs,
plus depreciation) was £306.9m, 18% higher than last year's £260.3m.  Capital
expenditure was £150.9m.  This included £54.3m for 481 new buses in the UK.
In addition, the Group commenced leases on 278 new buses with a value of £31.7m.
In the USA, £58.4m was spent on 1,500 new vehicles which supported an additional
600 new vehicle routes. Capital expenditure at Bristol International Airport was
£5.9m in the period up to disposal.

£7.0m of the deposit on new rolling stock previously paid by the Group has
been refunded by the leasing company, as the first new trains were delivered
to First North Western.  The remaining deposits of £23.4m will be recovered
from the leasing companies when the other First North Western and the First
Great Western vehicles are delivered into service.

Balance sheet

Net assets of the Group increased from £336.2m to £458.6m.  The main elements
of the increase are the £52m retained profit, £60m of foreign exchange
differences, £40m of goodwill written back on the disposal of Bristol
International Airport and New World First Holdings, offset by the £31m of
share repurchases.

The Group's net debt has fallen over the year by £119.1m to £660.7m,
reflecting the Group's strong operating cash flow which remains positive after
high capital expenditure together with the disposal of Bristol International
Airport. The £38.5m proceeds from the sale of New World First Holdings have
largely been used for share repurchases.

Funding and risk management

The Group only borrows to finance investment and provide working capital.  It
does not enter into speculative financial transactions and uses financial
instruments for risk management purposes only.

As the Group is a net borrower, it minimises cash and bank deposits, although
it can only withdraw cash and bank deposits from the rail companies to the
extent of retained profits. Cash received in advance for rail season tickets
is protected by an insurance arrangement approved by the SRA, which has
replaced the bonded cash. The Group limits deposits with any one bank to a
maximum of £30m, depending upon the individual bank's credit rating.

The Group reduces exposure to interest rate risk by using interest rate swaps
and fixed rate debt.  At 31 March 2001, net debt amounted to £660.7m, which is
analysed below.

Analysis of net debt
                                               Fixed     Variable        Total
                                                  £m           £m           £m
Cash                                               -         28.2         28.2
Rail ring fenced cash                              -         50.2         50.2
Sterling bank loans and overdrafts                 -      (334.4)      (334.4)
US dollar bank loans                               -      (176.4)      (176.4)
Canadian dollar bank loans                         -        (6.0)        (6.0)
HP and finance leases                        (151.2)       (35.2)      (186.4)
Loan notes                                     (9.5)       (26.4)       (35.9)
Interest rate caps and swaps                 (451.5)        451.5            -
Total                                        (612.2)       (48.5)      (660.7)

The maturity profile of banking facilities is regularly reviewed.  Well in
advance of their expiry, the facilities are extended or replaced.  At the year
end, bank borrowing and guarantee facilities amounted to £825m, of which £617m
had more than two years to maturity.  This compares with total utilisation of
£517m.

The Group hedges part of its exposure to the impact of exchange rate movements
on translation of foreign currency net assets by holding net borrowings in
foreign currencies.

The Group manages exposure to fuel price movements by entering contracts with
suppliers to cap or fix the purchase price for future periods.

Shares in issue

During the year, 12.7m shares were repurchased and cancelled at a total cost
of £31.1m.  1.1m shares were issued to the Group's QUEST to be used to satisfy
SAYE share option exercises and 0.5m shares were issued on the exercise of
executive share options.  The total number of shares in issue decreased by
11.1m to 422.4m.  Immediately before the year end, the Group contracted to
purchase a further 0.2m shares, although settlement and cancellation did not
take place until immediately after the year end.  For the purpose of the
earnings per share calculation (excluding own shares held), the average number
of shares in issue for the year was 422.2m.  If the number of shares remained
unchanged for the forthcoming year, the average number in issue would be
421.1m.

Foreign exchange

The profits from the US have been translated at an average rate of £1:$1.49
(2000: £1:$1.62).  The year end rate was £1:$1.42, compared with £1:$1.60 last
year.

Accounting standards and policies

During the year, three new accounting standards were issued, being FRS 17
Retirement Benefits, FRS 18 Accounting Policies and FRS 19 Deferred Tax.  It
is intended to adopt FRS 19 in the forthcoming year and to follow the phased
introduction of FRS 17 that is provided for in its transitional arrangements,
starting in the forthcoming year.  The Group already complies with FRS 18.

Iain Lanaghan
Group Finance Director


                    
Consolidated profit and loss account 
For the year ended 31 March 2001 

                                                                              
              Notes    Before                      Before   Goodwill        
                      goodwill  Goodwill          goodwill       and        
                           and       and               and  exception        
                      exceptio  exceptio  Total  exception   al items   Total 
                           nal       nal   2001   al items       2000    2000 
                         items     items               2000                    
                          2001      2001                                       
                           £m        £m      £m         £m         £m      £m 
  Turnover                                                                    
  Continuing          2,015.7         -   2,015.7  1,763.8          -   1,763.8
  operations 
                             
  Acquisitions            3.4         -       3.4        -          -       - 
                      2,019.1         -   2,019.1  1,763.8          -   1,763.8
                                            
  Discontinued           34.9         -      34.9     31.3          -      31.3 
  operations                                                                  
  Group           2   2,054.0         -   2,054.0  1,795.1          -   1,795.1
  turnover
                                   
  Share of                                                                    
  turnover of             2.1         -       2.1     22.7          -      22.7 
  joint                                                                       
  ventures 
                                                                   
  Total               2,056.1         -   2,056.1  1,817.8          -   1,817.8
  turnover 
                                
  Operating                                                                   
  profit 
                                                                     
  Continuing            202.3    (79.3)     123.0    175.8     (24.6)     151.2 
  operations 
                                                                 
  Acquisitions            0.5     (0.1)       0.4        -          -       - 
                        202.8    (79.4)     123.4     175.8    (24.6)     151.2 

  Discontinued           11.5         -      11.5       9.9         -       9.9 
  operations
                                                                  
  Group           2     214.3    (79.4)     134.9     185.7    (24.6)     161.1 
  operating                                                                   
  profit 
                                                                     
  Group                                                                       
  operating             218.5         -     218.5     190.9         -     190.9 
  profit before                                                                 
  goodwill and                                                                
  exceptional costs                                                             
         
  FNW             4         -    (39.9)     (39.9)        -          -       - 
  franchise                                                                   
  amendment                                                                   
  Other           4         -    (13.6)     (13.6)        -     (11.6)   (11.6)
  exceptional                                                                 
  costs                                                                       
  Goodwill        2         -    (25.9)     (25.9)        -     (13.0)   (13.0)
  amortisation                                                                
  Employees'                                                                  
  profit          2     (4.2)         -      (4.2)    (5.2)          -    (5.2) 
  sharing scheme                                                                
     
  Group           2     214.3    (79.4)     134.9    185.7      (24.6)   161.1 
  operating                                                                   
  profit
                                                                      
  Share of                                                                    
  operating                                                                   
  (losses)/prof         (0.8)         -   (0.8)        0.4          -      0.4 
  its of joint                                                                
  ventures
                                                                    
  Share of                                                                    
  operating             (0.2)         -   (0.2)          -          -       - 
  losses of                                                                   
  associate
                                                                   
  Amortisation                                                                
  of goodwill               -     (1.8)   (1.8)          -          -       - 
  on associate 
                                                               
  Amortisation                                                                
  of goodwill               -     (0.1)   (0.1)          -          -       - 
  on joint                                                                    
  ventures 
                                                                   
  Total                 213.3    (81.3)   132.0      186.1     (24.6)   161.5 
  operating profit                                                              
       
  Profit on                                                                   
  disposal of     6         -      69.4    69.4          -          -       - 
  businesses -                                                                
  discontinued                                                                
  operations 
                                                                 
  (Loss)/profit                                                               
  on disposal                                                                 
  of fixed                  -     (0.1)   (0.1)          -        4.0     4.0 
  assets -                                                                    
  continuing                                                                  
  operations
                                                                  
  Profit on                                                                   
  ordinary        2     213.3    (12.0)   201.3      186.1     (20.6)   165.5 
  activities                                                                  
  before interest                                                               
    
  Net interest                                                                
  payable and     7    (64.5)         -   (64.5)    (44.0)          -   (44.0)
  similar charges                                                               
     
  Profit on                                                                   
  ordinary              148.8    (12.0)   136.8      142.1     (20.6)   121.5 
  activities                                                                  
  before taxation                                                               
    
  Tax on                                                                      
  profit on       8    (22.7)    (19.3)   (42.0)    (26.1)        1.8   (24.3)
  ordinary                                                                    
  activities 
                                                                 
  Profit on                                                                   
  ordinary              126.1    (31.3)    94.8      116.0     (18.8)    97.2 
  activities                                                                  
  after taxation                                                                
   
  Equity                (3.9)         -   (3.9)      (3.7)          -   (3.7) 
  minority                                                                  
  interests 
                                                                  
  Profit for            122.2    (31.3)    90.9      112.3     (18.8)    93.5 
  the financial                                                                 
  year 
                                                                       
  Equity                                                                      
  dividends       9    (38.8)         -   (38.8)    (36.6)          -   (36.6)
  paid and                                                                    
  proposed 
                                                                   
  Retained                                                                    
  profit for     21      83.4    (31.3)    52.1       75.7     (18.8)    56.9 
  the financial                                                                 
  year  
                                                                      
                      Adjusted            Actual  Adjusted              Actual
                                                                              
  Basic          10     28.9p             21.5p      28.3p              23.6p 
  earnings per                                                                
  share
                                                                       
  Cash           10     49.6p                 -      45.6p                  - 
  earnings per                                                                
  share 
                                                                      
  Diluted        10         -             21.4p          -              23.4p 
  earnings per                                                                
  share                            
                                           
Consolidated balance sheet 
At 31 March 2001      
                                                                              
                                                  Notes       2001       2000 
                                                                £m         £m 
  Assets employed:                                                            
  Fixed assets                                                                
  Intangible assets                                  11      573.6      533.8 
  Tangible assets                                    12      742.0      724.8 
  Investments                                                                 
  - Joint ventures                                                            
  - Goodwill                                                   2.6          - 
  - Share of gross assets                                     35.1       80.7 
  - Share of gross liabilities                              (34.3)     (56.7) 
  - Shareholder loans                                          1.1          - 
                                                               4.5       24.0 
  - Other                                                      7.6        7.3 
                                                     13       12.1       31.3 
                                                           1,327.7    1,289.9 
  Current assets                                                              
  Stocks                                             14       23.5       21.9 
  Debtors                                            15      279.3      260.8 
  Investments                                        16       11.8       48.8 
  Cash at bank and in hand                           17       66.6       47.8 
                                                             381.2      379.3 

  Creditors: amounts falling due within one          18    (591.8)    (532.4) 
  year                                                                        

  Net current (liabilities)/assets                                            
  Due within one year                                      (237.2)    (177.8) 
  Amounts due after more than one year               15       26.6       24.7 
  Net current (liabilities)/assets                         (210.6)    (153.1) 
  Total assets less current liabilities                    1,117.1    1,136.8 
  Creditors: amounts falling due after more          18    (622.6)    (750.9) 
  than one year                                                               
  Provisions for liabilities and charges             19     (35.0)     (39.9) 
                                                             459.5      346.0 
  Financed by:                                                                
  Capital and reserves                                                        
  Called up share capital                                     21.1       21.7 
  Share premium account                              21      236.7      233.6 
  Revaluation reserve                                21        3.6        3.7 
  Other reserves                                     21        3.4        2.8 
  Profit and loss account                            21      193.8       74.4 

  Equity shareholders' funds                                 458.6      336.2 

  Equity minority interests                                    0.9        9.8 

                                                             459.5      346.0 
 
Consolidated cash flow statement  
For the year ended 31 March 2001 

                                                                              
                                                     Notes      2001      2000
                                                                  £m        £m

  Net cash inflow from operating activities          22(a)     261.8     193.6
  Returns on investments and servicing of finance    22(b)    (54.6)    (42.2)
  Taxation                                                                    
  Corporation tax paid                                        (20.3)    (11.8)
  Capital expenditure and financial investment       22(c)    (50.4)    (73.1)
  Acquisitions and disposals                         22(d)     151.2   (609.3)
  Equity dividends paid                                       (36.9)    (28.8)
  Cash inflow/ (outflow) before use of liquid                                 
  resources and financing                                      250.8   (571.6)
  Management of liquid resources                                              
  Increase in bank deposits                                    (0.6)    (11.2)
  Financing                                          22(e)   (227.5)     587.2
  Increase in cash in year                                      22.7       4.4

Reconciliation of net cash flows to movements in net debt 
For the year ended 31 March 2001 
                                                                              
                                                     Notes      2001      2000
                                                                  £m        £m

  Increase in cash in year                                      22.7       4.4

  Cash inflow / (outflow) from decrease /                      199.8   (355.2)
  (increase) in debt and hire purchase contract                               
  and finance lease financing 
                                                
  Movement in current asset investments                       (37.0)      10.7

  Debt issued on acquisition of subsidiary                         -     (5.2)
  undertakings 
                                                               
  Debt and hire purchase contracts and finance                 (2.2)    (25.9)
  leases acquired with subsidiary undertakings                                
  and businesses 
                                                             
  Inception of hire purchase contracts and                    (42.5)    (53.8)
  finance leases 
                                                             
  Debt issuance fees paid                                          -       1.8

  Amortisation of debt issuance fees                           (0.4)     (0.2)

  Foreign exchange difference                                 (21.3)       0.2

  Movement in net debt in year                                 119.1   (423.2)

  Net debt at beginning of year                         23   (779.8)   (356.6)

  Net debt at end of year                               23   (660.7)   (779.8)


Consolidated statement of total recognised gains and losses 
For the year ended 31 March 2001 

                                                             2001   2000
                                                               £m     £m

        Profit for the year attributable to shareholders     90.9   93.5

        Foreign exchange differences                         60.0      -

        Total recognised gains and losses                   150.9   93.5
 

Reconciliation of movements in shareholders' funds 
For the year ended 31 March 2001 
                                                                           
                                                                 2001     2000
                                                                   £m       £m
  Profit for the financial year                                  90.9     93.5
  Dividends                                                    (38.8)   (36.6)
                                                                 52.1     56.9
  Shares issued:                                                              
  - in respect of subsidiaries acquired                             -      2.7
  - in respect of 1 for 4 rights issue                              -    231.9
  - to QUEST                                                      2.6      6.0
  - in respect of exercise of savings related and executive       0.5      0.1
  share options                                                               
  Own shares purchased and cancelled                           (31.1)    (3.7)
  Write down of own shares held by QUEST                        (1.5)    (3.7)
  Goodwill written back on disposal of businesses                39.8        -
  Foreign exchange differences                                   60.0        -
  Net addition to shareholders' funds                           122.4    290.2
  Shareholders' funds at beginning of year                      336.2     46.0
  Shareholders' funds at end of year                            458.6    336.2


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