Final Results

Pendragon PLC
14 February 2002



FOR IMMEDIATE RELEASE                                           14 February 2002


                     PRELIMINARY RESULTS TO 31 DECEMBER 2001

Pendragon PLC, the UK's largest car dealership group, today reports preliminary
results for the full year to 31 December 2001.


Financial Highlights:


*    Turnover up 5% to £1.7 billion (2000 £1.6 billion)
*    Operating profit before exceptionals and goodwill up 54% to £42.6 million
*    Profit before tax £30.6 million (2000 £4.1 million)
*    Dividend up 8% to 15.9p (2000 14.7p)
*    Strong operating cashflow £62.4 million (2000 £42.3 million)



Trevor Finn, Chief Executive, commented:

'The outstanding results for the year demonstrate the potential that has been
created in our business. The repositioning of our franchise portfolio towards
the upper end of the market has improved our quality of earnings and enabled us
to take full advantage of returning consumer confidence.

This year has started well and we are looking forward to a good 2002.  The
proposed changes to the block exemption rules should favour dealers like
ourselves and increase our commercial independence from the manufacturer.'


Enquiries:

Pendragon PLC  Trevor Finn, Chief Executive               Tel:   [phone]
               David Forsyth, Finance Director

Finsbury       Rupert Younger                             Tel:   [phone]
               Charlotte Festing


Introduction


The group has had one of its most successful years of trading.  Profits have
improved significantly and margins are at their highest level for five years.
We have further improved returns for shareholders by actively managing our
property portfolio in order to realise significant profits from selective
disposals.

Our motor car franchise portfolio is focused increasingly on the luxury car
market. During the year we expanded our business overseas, and have seen a
particularly strong performance from our USA dealerships.

We have continued to successfully develop and apply innovative technology based
services to our car retailing business.  Apart from improving the operating
efficiency of the group these services are being marketed to third party dealers
and manufacturers.


Results and Dividend

The table below summarises our results for the year.
                                                                                         2001             2000
                                                                                           £m               £m

Total Turnover - group and share of joint venture                                    1,728.4          1,637.2
Total Underlying Operating Profit                                                       42.6             27.6
Exceptional Costs                                                                          -             (6.4)
Goodwill Amortisation                                                                   (3.4)            (2.6)
Total Operating Profit                                                                  39.2             18.6
Business Disposals                                                                      (2.3)            (3.0)
Property Disposals                                                                      10.2              4.0
Profit on ordinary activities before interest                                           47.1             19.6
Interest                                                                               (16.5)           (15.5)
Profit on ordinary activities before tax                                                30.6              4.1
Earnings per share                                                                      33.7p             9.0p
Dividend per share                                                                      15.9p            14.7p



Total turnover for the year ended 31 December 2001 was £1.7 billion compared to
£1.6 billion in 2000.  Operating profit before goodwill amortisation,
exceptional items and business and property disposals is up by 54% to £42.6
million from £27.6 million in 2000.  The group made a net profit on property and
business disposals of £7.9 million compared to £1.0 million in 2000. Profit on
ordinary activities before taxation increased to £30.6 million from £4.1 million
last year.

Earnings per share increased to 33.7 pence compared to 9.0 pence in 2000. The
board has proposed a final dividend of 10.6 pence per share.  Together with the
interim dividend of 5.3 pence per share, this makes a total of 15.9 pence per
share for the year, an increase of 8% when compared with the 14.7 pence per
share in 2000.

We continued to have strong cash flow during the year which has enabled us to
invest in new businesses whilst at the same time reduce our borrowings. Our
borrowings decreased to £127.5 million at the end of 2001 from £137.6 million
last year.  Cash flow generated from operations was £62.4 million up from £42.3
million in 2000.


Trading environment

A number of factors influenced the car market in the UK in 2001.  Lower interest
rates combined with lower new car prices helped registrations of new cars to
reach record levels.  We have also seen more stability in used car prices.  The
steady growth over the past few years in the absolute number of motor cars on
the road in the UK contributes to strong performance in the after sales area of
the business.  There was much talk of recession in the USA in 2001 and, together
with the terrorist attacks in September, this led to a fragile US car market.  A
slowdown in the German economy placed the car market under severe pressure which
resulted in reduced volumes and diluted margins.


Motor Retail Business

The principal activity of the business is the sale and servicing of motor cars.
Across the whole group, new car sales account for 32% of gross profit, used car
sales for 16% and after sales for 46%.  These percentages have not changed
significantly year on year.  The business is split across three markets: UK, USA
and Germany, each of which is explained in more detail below.


UK     We currently operate 150 franchises in the UK from 133 locations.  We
have a national network of dealerships from Exeter in the south to Edinburgh in
the north.  Our activities are centred on specialist and luxury cars and we also
operate Vauxhall and Ford dealerships in the volume sector.

The scale we have sought with our selected manufacturer partners in the UK was
mostly achieved in 2000 so that in 2001 we have had relatively little dealership
acquisition and disposal activity.  We have, however, continued to focus on
underperforming and non core dealerships.  We disposed of our remaining Saab,
Toyota, Suzuki and Mazda dealerships during the year and no longer represent
those manufacturers.  We also closed seven Volvo locations in December.  This
was in full consultation with the manufacturer and is in line with their current
representation plans.  We continue to operate 12 Volvo dealerships.

In the year we undertook selective greenfield developments within our existing
franchise territories.  The most significant of these were our investments in a
brand new BMW site at Taplow, Berkshire and five retail outlets for the new
Mini, a car which had strong sales performance in the second half of 2001. We
also opened a new Land Rover showroom in the West End of London.

The results for the UK business can be summarised as follows:


£m                         Turnover        Gross Profit         Gross Margin        Underlying        Underlying
                                                                           %         Operating         Operating
                                                                                        Profit          Margin %

Existing                    1,265.7               170.0                 13.4              43.6               3.5
Acquired                       57.6                 7.7                 13.3             (1.0)             (1.8)
Disposed                       55.2                 7.4                 13.3             (0.9)             (1.6)
Total 2001                  1,378.5               185.1                 13.4              41.7               3.0
Total 2000                  1,344.5               169.8                 12.6              29.4               2.2



Turnover in 2001 was maintained at a similar level to last year.  The increase
in activity due to the enlarged new car market in 2001 plus the contribution
from business acquisitions more than offset the reduction arising from the
disposal of volume franchises in 2000.  Gross margins and operating margins have
improved principally due to our moving the franchise portfolio up market and
higher activity levels in our specialist franchises.  All our motor car
franchise groups showed an improvement in trading performance.  The strongest
franchise performance in the year was in our BMW group which almost doubled
operating profit.

The results for acquired businesses shown in the above table principally relate
to our Ford group for November and December 2001.  These are seasonally the
poorest trading months in the UK industry and therefore the operating loss of
£1.0 million was in line with expectations.  The Ford group, prior to November,
had been part of our joint venture with Ford Motor Company.

The disposals during the year contributed turnover of £55.2 million and an
operating loss of £0.9 million.  The properties occupied by these businesses
have been retained for either alternative use within the group or for separate
disposal.

In December 2000 Mercedes-Benz notified us of a planned reorganisation of its UK
dealership network.  The new plan involved a reduction in the number of
operators with each retained operator having a larger market territory.
Discussions between existing operators and Mercedes resulted in an agreed
process for the transfer of businesses within the network.  A formula was put in
place to calculate compensation to be paid to outgoing dealers for loss of
business.

We currently operate seven Mercedes passenger car dealerships.  Mercedes has
offered us a Yorkshire market area, which would require us to add to the two
dealerships we currently operate in that area.  Our five other UK Mercedes
dealerships are in areas that will transfer to other operators.

Currently we plan to operate the five divestment sites until 30 June 2003.  We
are also in discussions with the owners of the two areas we will invest in,
although as yet no dates of purchase have been agreed.


Ford Dealerships Joint Venture     Our share of the loss on ordinary activities
before tax of our Ford joint venture, Stripestar, was £1.6 million compared to
£4.0 million in 2000.  The results for 2001 are for the first ten months only,
since we acquired Ford Motor Company's 49% shareholding in Stripestar on 2
November 2001.  Progress on improving the financial return on this business had
proved difficult under the joint venture structure.  Single ownership will
enable a more rapid response to changes in the industry sector and provide focus
on business and property reconfiguration, which will be an important element to
improving financial returns.

Whilst the business continued to make a loss, the overall performance has
improved significantly.  Since 2 November 2001 we have closed the Chesham
satellite and disposed of its freehold property.  We expect further progress on
changes to the format of the business during 2002 and continuing improvements in
the operating performance.


USA     We are very pleased with the progress we have made in building our
business in the USA over the past eighteen months.  Our dealerships, which are
located in California, performed well in the year as summarised in the table
below.


£m                     Turnover       Gross Profit         Gross Margin        Underlying        Underlying
                                                                      %         Operating         Operating
                                                                                   Profit          Margin %

Existing                   53.2                7.6                 14.3               2.5               4.7
Acquired                   49.0                8.4                 17.1               1.9               3.9
Total 2001                102.2               16.0                 15.6               4.4               4.3
Total 2000                 24.5                3.3                 13.5               1.1               4.5


Our original investment, Bauer Motors in Santa Ana acquired in July 2000, has
performed ahead of our expectations and is one of the highest volume Jaguar
dealers in the USA.  We have recently developed a new site in San Juan
Capistrano, the adjacent market area.  The new dealership called South Coast
Motors retails Jaguar cars and has contributed a small profit after only three
months of start up trading which is extremely encouraging.  Bauer Motors started
to sell Aston Martin in January 2002 following the award of the franchise for
Orange County.

In April 2001 we acquired Hornburg, the Jaguar and Land Rover dealer in
Hollywood and Santa Monica, approximately 40 miles north of our Bauer business.
Hornburg has contributed £1.9 million to operating profit in 2001 following a
successful integration into the group.  The gross margin at Hornburg is higher
than at Bauer due to the sales mix comprising a greater percentage of service
and parts business.

We operate four sales points and two separate service centres representing six
franchises - four Jaguar, one Land Rover and one Aston Martin.  We are actively
seeking to expand our USA business and anticipate making further progress in
2002.


Germany     Our business in Germany has grown over the last 18 months.  In
September 2000 we purchased dealerships in Munich and Anzing.  This has been
followed by the introduction of Land Rover to our Frankfurt Jaguar dealership.
In March 2001, we acquired a new Land Rover business in Darmstadt, a town south
of Frankfurt, for £2.1 million to which we have subsequently added Jaguar.  In
total we operate six sites with twelve franchises - six Jaguar, four Land Rover
and two Aston Martin.


The results for our German business can be summarised as follows:


£m                     Turnover        Gross Profit         Gross Margin        Underlying        Underlying
                                                                       %         Operating         Operating
                                                                                    Profit          Margin %

Existing                   32.1                 4.7                 14.7             (0.5)             (1.5)
Acquired                    1.8                 0.2                 10.0             (0.1)             (6.7)
Total 2001                 33.9                 4.9                 14.5             (0.6)             (1.8)
Total 2000                 21.3                 3.6                 16.9               1.3               5.9


The performance of the German business has been disappointing for a number of
reasons.  The German economy has been depressed throughout the year and although
the launch of the Jaguar X type in the second half of 2001 helped increase
volumes it did not achieve the results we had anticipated.

We believe that these businesses can trade profitably in 2002 with appropriate
manufacturer action.  However, until we can see a return to more normal trading
conditions in Germany further acquisitions there are unlikely.


Technology and Support Services

This group of businesses provides a broad range of technology based services to
both the Pendragon group and to outside customers.  The services are provided by
a number of specialist businesses which comprise:


*    Pinewood Computers (dealership management systems provider)
*    Pinewood telecom (telecom provider)
*    Car Fleet Control (fleet management software)
*    Pinewood Security (remote security monitoring)
*    C2K.co.uk (online contract hire)
*    Pendragon I (contract hire)
*    tins.co.uk (online car sales)
*    Loxley House (centralised customer service provider)


Collectively, these businesses contributed 6% of the total group gross profit
and made an operating profit of £2.5 million (2000: break even).


Technology     Pinewood specialises in the provision of dealership management
systems, telecommunications and remote security monitoring systems for the
retail motor industry.  It provides services to third parties as well as to
Pendragon's operations.  Subsequent to the dealer management system, CARS, being
granted approved status by Ford, a significant level of integration with Ford's
internal systems has been achieved.  The Ford approval has enabled us to market
the product more aggressively to Ford dealerships in the UK.

A new web based version of the dealership management system has been developed
over the past two years.  This product is due to be released in 2002 and we see
great opportunity in the UK and overseas markets.


E commerce     We operate two on line sales operations, C2K online and
tins.co.uk, in addition to which we provide administration and back office
processes to the Microsoft Carview website.  The sites continue to generate
significant traffic although the conversion rate to actual sales remains low.
We believe this is generally the experience across the sector.  During the year
we opened a number of used car sites, branded as tins car supermarkets, to take
advantage of the market exposure that the tins brand has had over the past two
years and satisfy the consumer requirement for a physical presence.  Although
the venture is in its early stages the results are encouraging.


Contract Hire    The performance of the business improved during the year as
the impact of the fall in used car residual values experienced during 1999 and
2000 worked their way out of the system.  The business made an operating profit
of £0.5 million (2000: loss of £0.4 million before repurchase commitment
provision of £1.5 million).  Predicting future used car residuals remains
difficult especially with recent record sales of new cars in the UK.
Consequently, we have allowed the fleet size to reduce to 8,127 cars at the end
of 2001 compared to 8,993 cars a year earlier by not aggressively marketing for
new business.


Loxley House Customer Service Centre     The customer service centre provides a
broad range of services to the group including, call centre, customer retention,
video sales functions and accounting services. During the year we commenced the
provision of services to our Land Rover, Jaguar and Volvo businesses.
Opportunities are being pursued to provide services to third party dealers and
manufacturers.


Profits on Sale of Property and Share Buybacks

During 2001 surplus property disposals generated £25.6 million proceeds and a
net profit before tax of £10.2 million.  We are continuing to manage our
property portfolio in order to release value from properties which become,
through the property management process, surplus to our business requirements.
We currently have under offer properties with a market value of £5.2 million.
In addition, we have two other significant properties being considered for
alternative planning approval.

In last year's annual report we stated our intention to realise shareholder
value created as a result of holding freehold property by utilising net profits
from the disposal of surplus properties to repurchase the company's ordinary
shares. It is currently the board's intention to continue with this policy.
During 2001 we repurchased 1.7 million shares at a cost of £3.9 million.


Financing

Borrowings at 31 December 2001 reduced to £127.5 million from £137.6 million at
the end of 2000.  Gearing at the year end was 88.7% down from 98.3% at the end
of 2000.  The reduction in borrowings is after bringing £21.3 million on balance
sheet in respect of the borrowings acquired with the purchase of Ford's share of
the joint venture.

Cash flow generated from operations was £62.4 million, which is an increase of
£20.1 million from the £42.3 million generated in 2000.  During the year we
continued to focus on working capital management.  A reduction of £8.0 million
was achieved in 2001 compared to £7.1 million reduction last year.  Net capital
expenditure excluding the proceeds from the sale of properties was £9.3 million
compared to £19.5 million in 2000.  The proceeds from property disposals
amounted to £25.6 million in the year.


Outlook

We will be monitoring closely progress of the European Commission draft
proposals on block exemption this year.  Our initial reaction is that the
proposals are favourable to car dealers, especially our group which has a large
national UK network.  We are particularly pleased that the Commission has
introduced measures designed to improve dealer's commercial independence from
manufacturers.

We have built a strong business platform over the past four years through the
development and deployment of innovative technology solutions allied to a
franchise portfolio which we have positioned at the upper end of the market.
Our leadership team and business systems are strong and flexible and can respond
very quickly to opportunities which should arise from changes to the way motor
cars are retailed and serviced under new European Commission rules.  Our
acquisitions in the USA add a new dimension to the business and offer great
potential for the future.

Overall we made significant progress in all respects in 2001 and the improved
trading conditions which we enjoyed last year have continued into 2002. We look
forward to another successful year.


                          Consolidated Profit and Loss Account

Year ended 31 December 2001

                                                                  2001          2001           2001           2000
                                                              Existing  Acquisitions          Total       Restated
                                                            Operations
                                                                  £000          £000           £000           £000

Total turnover - group and share of
joint venture                                               1,620,047       108,316      1,728,363      1,637,248

Less: share of joint venture turnover                        (179,188)            -       (179,188)      (208,993)


Group turnover                                              1,440,859       108,316      1,549,175      1,428,255


Cost of sales                                              (1,237,951)      (91,449)    (1,329,400)    (1,242,550)


Gross profit                                                  202,908        16,867        219,775        185,705


Net operating expenses                                       (163,255)      (16,637)      (179,892)      (164,087)


Group operating profit                                         39,653           230         39,883         21,618

Operating profit before goodwill
amortisation                                                   42,702           555         43,257         24,210
Goodwill amortisation                                          (3,049)         (325)        (3,374)        (2,592)

Group operating profit                                         39,653           230         39,883         21,618

Share of operating loss in joint venture                         (654)            -           (654)        (3,072)
Total operating profit                                         38,999           230         39,229         18,546

Loss on sale of businesses                                                                  (2,302)        (3,023)
Profit on disposal of fixed assets                                                          10,201          4,036
Profit on ordinary activities
before interest                                                                             47,128         19,559

Net interest payable
Group                                                                                      (15,617)       (14,483)
Joint venture                                                                                 (909)          (939)
                                                                                           (16,526)       (15,422)

Profit on ordinary activities
before taxation                                                                             30,602          4,137
Taxation                                                                                   (10,375)         1,354


Profit for the financial year                                                               20,227          5,491
Dividends (Note 2)                                                                          (8,940)        (8,553)


Retained profit/(loss) for
the financial year                                                                          11,287         (3,062)

Earnings per ordinary share (Note 3)                                                          33.7p           9.0p


                           Consolidated Balance Sheet

At 31 December 2001

                                                                 2001          2001          2000          2000
                                                                                         Restated      Restated
                                                                 £000          £000          £000          £000

Fixed assets
Goodwill                                                                    27,500                      23,684
Tangible assets                                                            173,773                     183,046
Investments
   Investments in joint venture
      Share of gross assets and preference shares                   -                     71,597
      Share of gross liabilities                                    -                    (62,537)
                                                                    -                      9,060
   Other investments                                            5,091                      3,613
                                                                             5,091                      12,673


                                                                           206,364                     219,403

Current assets
Stocks                                                                     267,160                     160,594
Repurchase commitments                                                      31,675                      51,808
Debtors                                                                     95,166                      80,799
Cash at bank and in hand                                                    14,707                           -

                                                                           408,708                     293,201

Creditors: amounts falling due within one year                            (327,516)                   (279,482)


Net current assets                                                          81,192                      13,719

Total assets less current liabilities                                      287,556                     233,122

Creditors: amounts falling due after
more than one year                                                        (142,996)                    (91,881)
Provisions for liabilities and charges                                        (911)                     (1,371)


Net assets                                                                 143,649                     139,870

Capital and reserves
Called up share capital                                                     14,812                      15,242
Share premium account                                                       74,716                      74,697
Other reserves                                                              10,769                      14,798
Profit and loss account                                                     43,352                      35,133


Equity shareholders' funds                                                 143,649                     139,870



                        Consolidated Cash Flow Statement


Year ended 31 December 2001
                                                                                         2001              2000
                                                                                         £000              £000

Cash flow from operating activities (Note 4)                                          62,420            42,318

Interest received                                                                        391               324
Interest paid                                                                        (14,711)          (15,238)

Returns on investments and servicing of finance                                      (14,320)          (14,914)

Taxation                                                                              (1,746)           (4,515)

Payments to acquire tangible fixed assets                                            (40,307)          (35,833)
Payments to acquire investments                                                       (1,490)           (2,113)
Receipts from sales of tangible fixed assets                                          58,042            44,294
Receipts from sales of investments                                                        12                 -

Capital expenditure and financial investment                                          16,257             6,348

Business acquisitions                                                                (18,580)          (91,343)
(Borrowings)/ cash of acquired businesses                                            (21,303)              974
Business disposals                                                                         -            35,241

Acquisitions and disposals                                                           (39,883)          (55,128)

Equity dividends paid                                                                 (8,727)           (8,118)

Net cash flow before financing                                                        14,001           (34,009)

Financing

Issue of ordinary share capital                                                           22                 -
Redemption of issued ordinary share capital                                           (3,930)                -
Repayment of unsecured bank loans                                                    (73,294)           (6,000)
Repayment of loan notes                                                                 (203)             (655)
Unsecured bank loans                                                                  90,000            25,211

Net cash inflow from financing                                                        12,595            18,556

Movements in cash and overdrafts                                                      26,596           (15,453)

Reconciliation of net cash flow to movement in net debt

Movement in cash and overdrafts                                                       26,596           (15,453)
Exchange differences                                                                     (18)                -
Cash inflow from increase in debt financing                                          (16,503)          (18,556)
Movement in net debt in the year                                                      10,075           (34,009)
Net debt at 31 December 2000                                                        (137,557)         (103,548)
Net debt at 31 December 2001                                                        (127,482)         (137,557)


              Group Statement of Total Recognised Gains and Losses

Year ended 31 December 2001
                                                                                        2001               2000
                                                                                                       Restated
                                                                                        £000               £000

Profit for the financial year                                                         20,227             5,491
Currency translation adjustments relating to net
investments in foreign enterprises                                                       438              (379)

Total recognised gains and losses relating to the year                                20,665             5,112

Prior year adjustment                                                                  3,234
Total gains and losses since last annual report                                       23,899

The reported profit for the year is not materially different from the profit on
an unmodified historical cost basis.



            Group Reconciliation of Movements in Shareholders' Funds

Year ended 31 December 2001

                                                                                      2001                2000
                                                                                                      Restated
                                                                                      £000                £000

Profit for the financial year                                                      20,227               5,491
Dividends                                                                          (8,940)             (8,553)
                                                                                   11,287              (3,062)
Exchange adjustment                                                                   438                (379)
Goodwill written back                                                                   -                 505
Issue of ordinary shares                                                               22                   -
Repurchase of ordinary shares                                                      (3,930)                  -
Unrealised profit eliminated on acquisition
of Stripestar Limited                                                              (4,038)                  -
Net addition to shareholders' funds                                                 3,779              (2,936)
Opening shareholders' funds                                                       139,870             142,806

Closing shareholders' funds                                                       143,649             139,870



Notes to the Financial Statements

1.  Restatement of prior year numbers
The group policy for accounting for deferred taxation has been amended to
reflect the implementation of Financial Reporting Standard 19 'Deferred Tax'. 
The main change on adopting this standard is that deferred tax assets associated
with fixed asset timing differences are now recognised on the group's balance
sheet.  The comparative figures have been restated to reflect the new policy
which has had the effect of increasing shareholders' funds at 31 December 2000
by £3,234,000 and reducing the taxation charge for the year ended 31 December
2000 by £2,922,000.

2.  Dividends                                                     2001                      2000
                                                                  £000                      £000
Ordinary shares
Interim paid 5.3p per share (2000: 4.9p)                         3,006                     2,832
Final proposed10.6p per share (2000: 9.8p)                       5,934                     5,721
                                                                 8,940                     8,553

Subject to approval at the Annual General Meeting, the final dividend will be
paid on 16 April 2002 to shareholders appearing on the register at the close of
business on 15 March 2002.

3.  Earnings per share
    a)  Adjustments to basic                         2001         2001         2000         2000
        earnings per share,                      Earnings        Total     Earnings        Total
        based on ordinary                             per                       per
        shares in issue                             share                     share
                                                                           restated     restated
                                                    pence         £000        pence         £000

Earnings                                            33.7       20,227          9.0        5,491
Goodwill amortisation                                5.6        3,374          4.3        2,592
Earnings excluding goodwill
amortisation                                        39.3       23,601         13.3        8,083
Non trading items:
Exceptional items                                     -            -          10.5        6,431
Profit on business and fixed
assets disposals                                   (13.1)      (7,899)        (1.6)      (1,013)
Tax effect of non trading items                      3.9        2,370         (2.7)      (1,625)
Earnings excluding goodwill
amortisation and
non trading items                                   30.1       18,072         19.5       11,876

    b)  Diluted earnings per                         2001         2001         2000         2000
        share, based on                           Diluted        Total      Diluted        Total
        weighted average                         earnings                  earnings
        number of shares in issue                     per                       per
                                                    share                     share
                                                    pence                  restated     restated
                                                                  £000        pence         £000

Earnings                                             32.8       20,227          8.9        5,491

    c)  Shares in issue                                           2001                      2000
                                                                number                    number
Weighted average number of
ordinary shares in issue                                    60,108,349                60,964,152

Weighted average number of
dilutive shares under option                                 1,650,126                   542,974

Weighted average number of
shares in issue taking account of
applicable outstanding share options                        61,758,475                61,507,126


The directors consider that the adjusted earnings per share figures provide a
better measure of comparative performance.

4.  Net cash inflow from operating activities                     2001                      2000
                                                                  £000                      £000

Operating profit                                                39,229                    18,546
Add share of joint venture's operating loss                        654                     3,072
Depreciation                                                    11,115                    10,929
Goodwill amortisation                                            3,374                     2,592
Loss on disposal of fixed assets                                    14                        77
Movement in working capital                                      8,034                     7,102

                                                                62,420                    42,318

5.  Annual Report

The above financial information does not represent the full financial statements
of the company. Full financial statements for the year ended 31 December 2000,
containing an unqualified audit report have been delivered to the registrar of
companies.  Full financial statements for the year ended 31 December 2001, which
have been reported on without qualification by the group's auditors, will
shortly be posted to shareholders, and after adoption at the Annual General
Meeting on 15 April 2002 will be delivered to the Registrar.


Copies of this announcement are available from Pendragon PLC, Loxley House, 2
Oakwood Court, Little Oak Drive, Annesley, Nottinghamshire.




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