Interim Results - 6 Months to 30 September 1999

Peel Holdings PLC
20 December 1999


Chairman's Statement

Results
The  Group  produced a strong trading performance for the half year  ended  30th
September  1999.  The  uplift  against the  corresponding  period  for  1998  is
substantial  as  this time The Trafford Centre which opened on  10th   September
1998  contributed  for  a  full six months. Helped by  rental  income from  The
Trafford Centre and an increase in profit from investment property sales, profit
before  taxation  rose  to £10.61m compared with £6.25m  for  the corresponding
period of the previous year.

Profit  on  ordinary activities after taxation, benefiting from a low  effective
tax  charge  of 10%, virtually doubled to £9.55m (1998: £4.82m) to give  diluted
earnings  per ordinary share of 10.99p against 4.93p. The Board has declared  an
 interim  dividend of 3.7p per ordinary share (1998: 3.2p). This will be paid 
on 6th  April 2000 to ordinary shareholders on the register at close of business
on 10th  March 2000.

Property
The  economic  background  during the half year  was  generally  favourable  for
property  with both occupier and investment demand showing a steady improvement.
 Total  Group  net  rental income for the half year moved forward strongly  from
£21.90m to £45.75m with The Trafford Centre contributing £24.31m (1998: £1.14m).
 Total voids at the half year end in the Group's UK investment property
portfolio (excluding  The Trafford Centre) were 6.0% of the total rent roll
compared  with 5.2%  the  previous  year. During the half year, rent lost  from 
new  vacancies exceeded rent from new lettings by £0.40m on an annualised basis,
but there  are indications that this situation will reverse by the financial
year end as  rents from  new lettings then begin to outweigh new voids. Income
during the half year from  rent reviews and lease renewals at £0.41m on an
annualised basis was close to last year's figure of £0.43m.

Taking  advantage  of  a  stronger property investment  market,  property  sales
advanced  during  the period to £21.00m with a profit of £0.82m  off  a  passing
yield of 8.3%.

The Group's  development  team  continued  to  create  shareholder  value   by
concentrating  on  developments  within or adjacent  to  the  existing  property
portfolio.  Zoning was obtained for a 1.1m sq. ft. business park development on
110  acres  of  land adjacent to Junction 39 of the M1. Planning permission  was
obtained  and  terms  were agreed with tenants for 48,000 sq.  ft.  of  non-food
retail space on land in Yeovil owned by the Group. Planning approvals were  also
granted  to  extend an existing Asda supermarket in Rawtenstall and  for  a  new
45,000  sq.  ft. food supermarket on land the Group owns in Dumfries.  A  92,000
sq.   ft.  building in Altrincham, pre-let to Rexam Printing, has been completed
and  forward sold to the Crown Estate Commissioners. In addition, a 120,000 sq.
ft.  cold storage facility at Heywood in Lancashire has been completed and  will
shortly be sold to H Yearsley Limited.

The  Group  was  successful  in its appeal against the  refusal  of  a  planning
application  for  residential  development at Rushgreen  Road,  Lymm. The  site
totalling  9  acres will provide approximately 100 dwellings  and  will  now  be
marketed  for  sale.  This  time last year, it was  reported  that  the  Group's
planning application for a 200,000 sq. ft. retail park at Giants Field, Trafford
Park, Manchester had been refused. It now seems likely however that this refusal
of permission will be quashed and a new public enquiry held in 2000.

The climate for increasing the revenue stream in the waste and minerals division
remains  tough.  Political  and  environmental  issues  continue  to   present
difficulties  for  securing planning permission for new  projects.  Income  from
existing  waste  and minerals projects totalled £0.31m in the half year  (1998:
£0.32m).

The Trafford Centre
Trade in The Trafford Centre continued to increase throughout 1999 as the Centre
established  itself  in the retail hierarchy of the North West.  The  annualised
rent  roll now stands at £49.1m plus turnover rents which will continue to  grow
as the Centre matures.

New  entrants into the retail market, pricing pressure and longer shopping hours
all  present  fresh  challenges for the Centre in  the  New  Year  and  we  must
endeavour to stay ahead of the competition, particularly through the maintenance
of  the  right  tenant  mix. In that context, it was  pleasing  to see  Spanish
retailer  Zara open only their third store in the UK. The remaining  four  unlet
units  are  under  offer and a waiting list of unsatisfied  retailer  demand  is
beginning to form.

The  JJB Sports multi-purpose sports hall opened in October 1999 and has already
proved  very  popular. Work continues on the adjacent golf driving  range  which
will open in the middle of next year. An application for a mixed use development
on land in the vicinity of The Trafford Centre to be known as Trafford Quays has
been  welcomed by the local planning authority and we hope will be  regarded  by
national planning policy as providing sustainable uses for an urban site.

Port
The  tough  conditions  seen  in the port in recent months  continued  with  new
business  hard  to  win and existing traffic staying competitive.  Tonnages and
operating profit again declined during the half year to 3.81m tonnes and  £1.07m
respectively  (1998:  3.92m tonnes and £1.33m). It is  hoped  however  that  the
downward trend is now beginning to bottom out and indeed liquid movements in and
out  of  the  Canal remain strong. Disappointingly, there are only a  few  early
 signs that companies are addressing the possibility of using water or rail
borne transport as an alternative to road.

Airports
Liverpool  Airport  experienced significant growth in its  passenger  throughput
during  the  half  year, mainly due to the launch by easyJet of  more  scheduled
services,  including Belfast, Madrid and Malaga. As a consequence,  the  Airport
handled  record passenger numbers and by the end of the calendar year expects a
throughput of nearly 1.3m passengers (1998: 0.88m).

Turnover  from  the  Airport's operations for the half year  was  £5.31m 
(1998:£5.44m).  This  decline in income reflects the challenging conditions 
following the  loss  of intra EU duty free and an increasingly competitive
airline  market place.  Progress  has  continued  in expanding  the  Airport's
operational  and passenger  facilities  with the completion of additional
aircraft  hardstanding, hangarage and improvements to the existing terminal
building.

The Group's investment in the former RAF Finningley airfield which was purchased
in  June  this  year  continues to move forward. The  planning  application  for
conversion  to a commercial airport was submitted to Doncaster MBC  in  November
1999.  It  proposes  an airport capable of handling 2.3m passengers  and  62,000
tonnes of freight per annum by the year 2014.

Finances
Group  borrowings at the half year end stood at £669.17m close to the figure  of
£655.27m at 31st  March 1999. Net interest payable during the half year totalled
£32.30m. This compares with £29.31m in the previous half year, of which  £12.39m
was capitalised in respect of The Trafford Centre until its opening in September
1998.  Gearing at the half year stood at 79.5% compared with 78.0% at 31st March
1999. The Company cancelled and repaid on 9th  June 1999 all of the class of 10%
non-redeemable cumulative preference shares at a total cost of £3.24m.

As  announced  on  1st   November 1999, the proposal to refinance  part  of  the
Group's  borrowings and raise further funds by securitising The Trafford  Centre
was  halted  because of adverse market conditions. If the Group finally cancels
its  plans  for  securitisation,  it  is  likely  to  incur  abortive  costs  of
approximately £2.0m. The Group is continuing to explore other avenues of raising
finance although it has sufficient financial resources for its commitments.

Year 2000
The  Group  has continued with its Year 2000 programme. All operational  systems
have  been  tested and any defects rectified. Whilst the Group  cannot give  an
absolute assurance that it will not be adversely affected by the advent of  Year
2000,  it believes that appropriate actions have been taken in relation  to its
own business critical systems and contingency plans are in place to mitigate any
areas of material risk.

Future Prospects
The  underlying  UK  economy is generally sound with buoyant demand  and  steady
growth although in the retail sector tough conditions exist which may impact on
the  Group's assets. Furthermore, the planning environment has become even  more
restrictive  whilst conditions in the port and airport sectors are  competitive.
 Nevertheless, the Group continues to create opportunities for sustainable
growth  from  its  strategically  important assets and extensive  land  bank 
and  as  a consequence we believe that the outlook for the Group remains
positive.

John Whittaker                               20th December 1999
Chairman


Unaudited Group Profit and Loss Account
for the half year ended 30th September 1999
                                               6 months to    6 months to
                                               30th September 30th September
                                                     1999         1998
                                          Note     £'000         £'000
TURNOVER                                          61,394        36,505
Operating profit                                  42,053        22,536
Profit on disposal of fixed assets                   857           479
Profit on ordinary activities before
interest and taxation                             42,910        23,015
Net interest payable                             (32,296)      (16,767)
Profit on ordinary activities before taxation     10,614         6,248
Tax on profit on ordinary activities              (1,061)       (1,431)
Profit on ordinary activities after taxation       9,553         4,817
Minority interests                                    15          (172)
Profit for the period                              9,568         4,645
Dividends                                         (3,590)       (3,309)
Retained profit for the financial period 
transferred to reserves                            5,978         1,336
Earnings per ordinary share                  1
Basic earnings per ordinary share                  11.45p         4.93p
Diluted earnings per ordinary share                10.99p         4.93p

                                                                                
                                                                                

Unaudited Group Cash Flow Statement
for the half year ended 30th September 1999
                                               6 months to      6 months to
                                               30th September 30th September
                                                   1999           1998
                                          Note    £'000          £'000
Cash flow from operating activities       2 (a)   45,807        44,495
Returns on investments and servicing 
of finance                                2 (b)  (32,978)      (22,394)
Taxation                                             (42)       (1,292)
Capital expenditure and financial 
investment                                2 (c)  (22,983)      (97,536)
Equity dividends                                  (2,835)       (2,054)
Cash flow before use of liquid resources 
and financing                                    (13,031)      (78,781)
Management of liquid resources                   (18,765)        5,843
Financing                                 2 (d)   18,155        70,847

Decrease in cash in the period                   (13,641)       (2,091)

Reconciliation of Cash Flow to movement in Net Debt

                                               6 months to     6 months to
                                               30th September 30th September
                                                   1999            1998
                                          Note    £'000           £'000
Movement in cash in the period               3 (13,641)          (2,091)
Cash movement from management of 
liquid resources                             3  18,765           (5,843)
Net movement in debt due within one year     3     497           (1,184)
Net movement in debt due after more than 
one year                                     3 (19,483)         (78,813)
Translation and other non-cash adjustments   3     (40)            (416)
Change in net debt in the period               (13,902)         (88,347)
Net debt at 1st April 1999/1st April 1998     (655,265)        (527,339)
Net debt at 30th September 1999/30th 
September 1998                                (669,167)        (615,686)


Notes to the Interim Results for the half year ended 30th September 1999

1. Earnings per Ordinary Share 
 
                       Profit               Weighted
                       attributable          average
                       to ordinary         number of       Earnings per
                       Shareholders           shares             share
                       30 September      30 September      30 September 
                       1999   1998     1999      1998     1999     1998
                       £'000  £'000    Number    Number      p      p
Basic earnings per 
ordinary share         8,831   3,802 77,098,233 77,058,435  11.45  4.93
Effect of dilutive 
securities:
Share options             -      -       69,061     94,921     -     -
Convertible cumulative 
preference shares       714      -    9,713,312       -    (0.46)    -
                       9,545   3,802 86,880,606 77,153,356 10.99   4.93

The 1998 diluted earnings per ordinary share figures have  been  restated  to
comply with FRS14.

2. Notes to the Cash Flow Statement
                                            6 months to    6 months to
                                         30th September  30th September
                                                   1999    1998
                                                  £'000   £'000
(a) Cash flow from operating activities
Operating profit                                42,053    22,536
Non-cash adjustments                             1,418       871
Movement in stocks                             (1,843)     (984)
Movement in debtors                            (3,434)   15,977
Movement in creditors                            7,613    6,095
                                                45,807   44,495

(b) Returns on investments and servicing of finance
Interest received                                1,309    2,388
Interest paid (including capitalised)         (33,635)  (23,721)
Finance lease interest paid                      (155)     (98)
Non-equity dividends paid                        (497)    (963)
                                              (32,978)  (22,394)


(c) Capital expenditure and financial investment
Purchase of fixed assets                      (47,571)  (98,466)
Sale proceeds from fixed assets                 24,585      908
Loans repaid by associated undertakings              3       22
                                              (22,983)  (97,536)

                                                                                
                                                                                
                                            6 months to  6 months to
                                         30th September  30th September
                                                   1999      1998
                                                  £'000     £'000

(d) Financing
Shares issued                                        3      -
Purchase of own shares                          (3,240)      (9,640)
Movement in loans                               18,986       80,286
Grants received                                  2,406          201
                                                18,155       70,847

3. Analysis of Movement in Group Net Debt

                                                                  30th
                      1st April        Exchange/             September
                           1999    Cash   Other Reallocations    1999
                          £'000   £'000   £'000   £'000         £'000
Cash at bank and 
overdrafts              46,532  (13,641)   (153)     -         32,738
Cash deposits           10,848   18,765       -      -         29,613
Debt due within one year

(excluding overdrafts) (12,868)    497      113  (11,000)    (23,258)
Debt due after more 
than one year         (699,777) (19,483)     -    11,000    (708,260)
                      (655,265) (13,862)    (40)      -     (669,167)

4. Interim Results
The  unaudited  results  for  the half year ended 30th  September  1999  do  not
comprise full financial statements within the meaning of the Companies Act 1985.
They  have  been  prepared having regard to the guidance in  the  ASB  statement
'Interim  Reports', and on the basis of the accounting policies set out  in  the
Group's audited financial statements for the year ended 31st March 1999,  except
that  no  summarised  balance sheet has been produced. In  the  opinion  of  the
Directors a summarised balance sheet would provide little additional information
to that already contained in the Unaudited Group Profit and Loss Account and the
Unaudited Group Cash Flow Statement.

Copies  of  this  interim  report will be despatched to  shareholders  by  post.
Further copies may be obtained from the Company Secretary, Peel Holdings p.l.c.,
Peel Dome, The Trafford Centre, Manchester M17 8PL.