Brian WallaceBrian WallaceGroup Finance DirectorGroup Finance Director

and Deputy Chief Executiveand Deputy Chief Executive

Brian WallaceBrian WallaceGroup Finance DirectorGroup Finance Director

and Deputy Chief Executiveand Deputy Chief Executive

Hotels 97.8 126.3 (22.6)%

Worldwide Betting 76.5 62.6 22.2%

Disposal businesses - 1.2

Central costs and income (6.6) (6.2)

Operating profit (2) 167.7 183.9 (8.8)%

Interest (37.7) (39.6) 4.8%

Profit before tax (2) 130.0 144.3 (9.9)%

Effective tax rate (2) 22.0% 21.1%

EBITDA (2) 237.7 239.3 (0.7)%

Hotels 97.8 126.3 (22.6)%

Worldwide Betting 76.5 62.6 22.2%

Disposal businesses - 1.2

Central costs and income (6.6) (6.2)

Operating profit (2) 167.7 183.9 (8.8)%

Interest (37.7) (39.6) 4.8%

Profit before tax (2) 130.0 144.3 (9.9)%

Effective tax rate (2) 22.0% 21.1%

EBITDA (2) 237.7 239.3 (0.7)%

6 months to30 June 2002

£m

6 months to30 June 2002

£m

6 months to30 June 2001(1)

£m

6 months to30 June 2001(1)

£m

Hilton Group plc Hilton Group plc - - Summary of PerformanceSummary of PerformanceHilton Group plc Hilton Group plc - - Summary of PerformanceSummary of Performance

VarianceB(W)

VarianceB(W)

(1)(1) Restated for the impact of FRS 19 Restated for the impact of FRS 19(2)(2) Before goodwill amortisation and exceptional items Before goodwill amortisation and exceptional items

Reported profit 97.8 126.3 (22.6)%

Scandic profit (16.6) (2.7)

Comparable profit 81.2 123.6 (34.3)%

Royal Bank of Scotland rent 9.5 6.7

Disposals / new openings (1.0) (2.7)

Foreign exchange (0.6) -

Like for like profit 89.1 127.6 (30.2)%

Reported profit 97.8 126.3 (22.6)%

Scandic profit (16.6) (2.7)

Comparable profit 81.2 123.6 (34.3)%

Royal Bank of Scotland rent 9.5 6.7

Disposals / new openings (1.0) (2.7)

Foreign exchange (0.6) -

Like for like profit 89.1 127.6 (30.2)%

2002£m

2002£m

Hotels - Like for Like Profit Hotels - Like for Like Profit (1)(1)Hotels - Like for Like Profit Hotels - Like for Like Profit (1)(1)

%change

%change

2001£m

2001£m

(1) Before goodwill amortisation and exceptional items(1) Before goodwill amortisation and exceptional items

Like for Like Hotels, Constant CurrenciesLike for Like Hotels, Constant Currencies5%5%

0%0%

(5)%(5)%

(10)%(10)%

Occ % growthOcc % growth Rate growthRate growth RevPAR growthRevPAR growth

Including ScandicIncluding ScandicMarch / April have been combined to avoid the distortion caused by the timing of EasterMarch / April have been combined to avoid the distortion caused by the timing of Easter

Hotels Worldwide Occupancy,Hotels Worldwide Occupancy,Rate and RevPAR Performance vs 2001Rate and RevPAR Performance vs 2001Hotels Worldwide Occupancy,Hotels Worldwide Occupancy,Rate and RevPAR Performance vs 2001Rate and RevPAR Performance vs 2001

JanJan FebFeb Mar / AprMar / Apr MayMay JuneJune JulyJuly

1.1%1.1%

(7.5)%(7.5)%

(4.3)%(4.3)%

(5.5)%(5.5)% (5.6)%(5.6)%

(4.3)%(4.3)%

Hotels Worldwide RevPAR by Ownership TypeHotels Worldwide RevPAR by Ownership TypeHotels Worldwide RevPAR by Ownership TypeHotels Worldwide RevPAR by Ownership Type

Like for Like, Constant CurrenciesLike for Like, Constant Currencies

0%0%

(2)%(2)%

(6)%(6)%

(10)%(10)%

(12)%(12)%

First half RevPAR growth 2002 vs 2001First half RevPAR growth 2002 vs 2001

(10.0)%(10.0)%

(4)%(4)%

(8)%(8)%(8.3)%(8.3)% (8.2)%(8.2)%

(0.8)%(0.8)% First half RevPAR growth First half RevPAR growth

2002 vs 2001 split by owned 2002 vs 2001 split by owned properties, fixed lease, properties, fixed lease, contingent leasecontingent leaseand management contractand management contract

Includes Scandic inIncludes Scandic in2001 although it was2001 although it wasonly consolidated fromonly consolidated from1111thth June 2001 June 2001

First half RevPAR growth First half RevPAR growth 2002 vs 2001 split by owned 2002 vs 2001 split by owned properties, fixed lease, properties, fixed lease, contingent leasecontingent leaseand management contractand management contract

Includes Scandic inIncludes Scandic in2001 although it was2001 although it wasonly consolidated fromonly consolidated from1111thth June 2001 June 2001

Fixed leaseFixed lease OwnedOwned Contingent leaseContingent lease ManagedManaged

Revenue decreaseRevenue decrease (61.1)(61.1)

GOP decrease GOP decrease (1)(1) (36.3)(36.3)

Revenue decreaseRevenue decrease (61.1)(61.1)

GOP decrease GOP decrease (1)(1) (36.3)(36.3)

Hotels - Cost ManagementHotels - Cost ManagementHotels - Cost ManagementHotels - Cost Management

Like for LikeLike for Like

(1) Before exceptional items and goodwill amortisation(1) Before exceptional items and goodwill amortisationExcludes ScandicExcludes Scandic

£m£m

Incremental conversionIncremental conversion 40.6%40.6%Incremental conversionIncremental conversion 40.6%40.6%

Rental and owners returnRental and owners return 2.62.6

RatesRates (2.4)(2.4)

Insurance and otherInsurance and other (1.8)(1.8)

Foreign exchangeForeign exchange (0.6)(0.6)

(2.2)(2.2)

Rental and owners returnRental and owners return 2.62.6

RatesRates (2.4)(2.4)

Insurance and otherInsurance and other (1.8)(1.8)

Foreign exchangeForeign exchange (0.6)(0.6)

(2.2)(2.2)

Operating profitOperating profitdecrease decrease (1)(1) (38.5)(38.5)Operating profitOperating profitdecrease decrease (1)(1) (38.5)(38.5)

UK Hotels RevPAR Performance vs 2001UK Hotels RevPAR Performance vs 2001UK Hotels RevPAR Performance vs 2001UK Hotels RevPAR Performance vs 2001

Like for Like HotelsLike for Like Hotels5%5%

0%0%

(5)%(5)%

(15)%(15)%

(20)%(20)%JanJan FebFeb Mar / AprMar / Apr MayMay JuneJune JulyJuly

ProvincesProvinces

(10)%(10)%

London 5 starLondon 5 star London 4 starLondon 4 star Total UKTotal UK

March / April have been combined to avoid the distortion caused by the timing of EasterMarch / April have been combined to avoid the distortion caused by the timing of Easter

Hilton vs London MarketHilton vs London MarketHilton vs London MarketHilton vs London Market

Cumulative Year to Date RevPAR PremiumCumulative Year to Date RevPAR Premium

£50£50

£60£60

£70£70

£80£80

JanJan

£90£90

FebFeb MarMar AprApr MayMay JuneJune

RevPAR (£)RevPAR (£)

4%4%

10%10%

18%18%PremiumPremium

6%6%

8%8%

12%12%

14%14%

16%16%The Market RevPAR 2002The Market RevPAR 2002

Hilton RevPAR 2002Hilton RevPAR 2002

Hilton RevPAR Premium 2002Hilton RevPAR Premium 2002

Market Source: PKF Hotel Consultancy ServicesMarket Source: PKF Hotel Consultancy Services

France, Germany, BeneluxFrance, Germany, BeneluxRevPAR Performance vs 2001RevPAR Performance vs 2001France, Germany, BeneluxFrance, Germany, BeneluxRevPAR Performance vs 2001RevPAR Performance vs 2001

Like for Like, Constant CurrenciesLike for Like, Constant Currencies0%0%

(10)%(10)%

(15)%(15)%

(25)%(25)%

(30)%(30)%BeneluxBenelux

(5)%(5)%

(20)%(20)%

FranceFrance GermanyGermany

Including ScandicIncluding ScandicMarch / April have been combined to avoid the distortion caused by the timing of EasterMarch / April have been combined to avoid the distortion caused by the timing of Easter

JanJan FebFeb Mar / AprMar / Apr MayMay JuneJune JulyJuly

Scandic - Occupancy, Rate and RevPAR Scandic - Occupancy, Rate and RevPAR Performance vs 2001Performance vs 2001Scandic - Occupancy, Rate and RevPAR Scandic - Occupancy, Rate and RevPAR Performance vs 2001Performance vs 2001

Like for Like, Constant CurrenciesLike for Like, Constant Currencies5%5%

0%0%

(5)%(5)%

(10)%(10)%

(15)%(15)%

(10.2)%(10.2)%

Occ % growthOcc % growth Rate growthRate growth RevPAR growthRevPAR growth

March / April have been combined to avoid the distortion caused by the timing of EasterMarch / April have been combined to avoid the distortion caused by the timing of Easter

2.5%2.5%

(5.4)%(5.4)%

(1.9)%(1.9)%

(5.9)%(5.9)%

(0.7)%(0.7)%

JanJan FebFeb Mar / AprMar / Apr MayMay JuneJune JulyJuly

Like for like hotels trading (3.9)

Openings / closures / major refurbishments (3.5)

Integration synergies 5.8

Like for like hotels trading (3.9)

Openings / closures / major refurbishments (3.5)

Integration synergies 5.8

Profit Impact£m

Profit Impact£m

Scandic - Financial UpdateScandic - Financial UpdateScandic - Financial UpdateScandic - Financial Update

Integration synergies in excess of £10m on an Integration synergies in excess of £10m on an annualised basisannualised basis

Integration synergies in excess of £10m on an Integration synergies in excess of £10m on an annualised basisannualised basis

Successful integrationSuccessful integration

Cost savings exceededCost savings exceeded

Transformed UK market positionTransformed UK market position

Returns held back by 11Returns held back by 11thth September and September and economic slowdowneconomic slowdown

Successful integrationSuccessful integration

Cost savings exceededCost savings exceeded

Transformed UK market positionTransformed UK market position

Returns held back by 11Returns held back by 11thth September and September and economic slowdowneconomic slowdown

Stakis - Post Acquisition ReviewStakis - Post Acquisition ReviewStakis - Post Acquisition ReviewStakis - Post Acquisition Review

Retail Betting 1,353.3 933.2 64.1 58.0

Telephone Betting 193.8 125.8 4.7 1.6

eGaming 192.3 62.8 5.1 0.2

Vernons 15.1 15.3 2.6 2.8

Worldwide Betting 1,754.5 1,137.1 76.5 62.6

Retail Betting 1,353.3 933.2 64.1 58.0

Telephone Betting 193.8 125.8 4.7 1.6

eGaming 192.3 62.8 5.1 0.2

Vernons 15.1 15.3 2.6 2.8

Worldwide Betting 1,754.5 1,137.1 76.5 62.6

2002£m

2002£m

Worldwide BettingWorldwide BettingWorldwide BettingWorldwide Betting

2001£m

2001£m

2002£m

2002£m

2001£m

2001£m

TurnoverTurnover Operating Profit (1)Operating Profit (1)

(1) Before goodwill amortisation and exceptional items(1) Before goodwill amortisation and exceptional items

Gross Win by ChannelGross Win by ChannelGross Win by ChannelGross Win by Channel

2002 Gross win - £319.9m2002 Gross win - £319.9m 2001 Gross win - £295.5m2001 Gross win - £295.5m

European RetailEuropean Retail Telephone BettingTelephone Betting eGamingeGaming

87%87%

8%8%5%5%

91%91%

4%4%5%5%

Gross win is before duty / gross profit tax are deductedGross win is before duty / gross profit tax are deductedNB. European retail includes AWPs net of VATNB. European retail includes AWPs net of VAT

UK Retail BettingUK Retail BettingUK Retail BettingUK Retail Betting

Year on Year Turnover Growth - Zero Deduction EffectYear on Year Turnover Growth - Zero Deduction Effect(2001/ 2 vs 2000/1)(2001/ 2 vs 2000/1)

0%0%

20%20%

40%40%

60%60%

OctOct

80%80%

NovNov DecDec JanJan FebFeb MarMar AprApr MayMay JuneJune

Actual growthActual growth Trendline (growth due to zero deduction)Trendline (growth due to zero deduction)

Growth due to zero deductionGrowth due to zero deduction

Telephone BettingTelephone BettingTelephone BettingTelephone Betting

Single account proposition across telephone, online and interactive TVSingle account proposition across telephone, online and interactive TV

Voice recognition on trial during World CupVoice recognition on trial during World Cup

Single account proposition across telephone, online and interactive TVSingle account proposition across telephone, online and interactive TV

Voice recognition on trial during World CupVoice recognition on trial during World Cup

2002£m

2002£m

2001£m

2001£m

Turnover 193.8 125.8

Gross win 15.0 14.6

Gross win margin 7.7% 11.6%

Operating profit 4.7 4.6

Average stake per call (£) 83.26 66.21

No. of calls (000’s) 2,264 1,840

Active customers (000’s) 87.7 80.2

Turnover 193.8 125.8

Gross win 15.0 14.6

Gross win margin 7.7% 11.6%

Operating profit 4.7 4.6

Average stake per call (£) 83.26 66.21

No. of calls (000’s) 2,264 1,840

Active customers (000’s) 87.7 80.2

eGamingeGamingeGamingeGaming

Turnover 192.3 62.8

Gross win (1) 26.8 10.4

Gross profit (2) 24.9 10.2

Gross profit % (2) 12.9% 16.2%

Operating profit 5.1 0.2

Active customers (000’s) (3) 179.4 83.3

Turnover 192.3 62.8

Gross win (1) 26.8 10.4

Gross profit (2) 24.9 10.2

Gross profit % (2) 12.9% 16.2%

Operating profit 5.1 0.2

Active customers (000’s) (3) 179.4 83.3

eGaming now has over 400,000 registered customerseGaming now has over 400,000 registered customers eGaming now has over 400,000 registered customerseGaming now has over 400,000 registered customers

2002£m

2002£m

2001£m

2001£m

(1) Gross win is before duty / gross profits tax are deducted(1) Gross win is before duty / gross profits tax are deducted(2) Gross profit is after duty / gross profits tax(2) Gross profit is after duty / gross profits tax(3) Active customers are those who placed a bet during the period(3) Active customers are those who placed a bet during the period

eGaming - Monthly TurnovereGaming - Monthly TurnovereGaming - Monthly TurnovereGaming - Monthly Turnover

4040

2525

1515

55

00

£m£m

2020

1010

£5m£5m

3030

3535

4545

£14m£14m

£41m£41m

64%64%

World CupWorld Cup

Euro 2000Euro 2000

June 2000June 2000 June 2001June 2001 June 2002June 2002

£23m£23m

eGaming SportsbookeGaming SportsbookeGaming SportsbookeGaming Sportsbook

First Half Turnover by CountryFirst Half Turnover by Country

UKUK Far EastFar East EuropeEurope

49%49%

4%4%10%10%

61%61%

1%1%6%6%

37%37%

32%32%

OtheOtherr

20022002 20012001

169% growth in sportsbook turnover year on year169% growth in sportsbook turnover year on year 169% growth in sportsbook turnover year on year169% growth in sportsbook turnover year on year

Hilton Group plc - Cash FlowHilton Group plc - Cash FlowHilton Group plc - Cash FlowHilton Group plc - Cash Flow

Opening net borrowings (1,473.9) (1,374.3)

Cash inflow from operating activities 211.8 193.9

Interest, tax and dividends paid (132.2) (134.5)

Free cash flow 79.6 59.4

Capital expenditure (85.2) (94.6)

Free cash flow after capex (5.6) (35.2)

Proceeds from asset sales 7.7 363.8

Acquisitions / disposals 3.5 (457.9)

5.6 (129.3)

Exchange and other movements (1) (43.6) 6.5

Net borrowings movement (38.0) (122.8)

Closing net borrowings (1,511.9) (1,497.1)

Opening net borrowings (1,473.9) (1,374.3)

Cash inflow from operating activities 211.8 193.9

Interest, tax and dividends paid (132.2) (134.5)

Free cash flow 79.6 59.4

Capital expenditure (85.2) (94.6)

Free cash flow after capex (5.6) (35.2)

Proceeds from asset sales 7.7 363.8

Acquisitions / disposals 3.5 (457.9)

5.6 (129.3)

Exchange and other movements (1) (43.6) 6.5

Net borrowings movement (38.0) (122.8)

Closing net borrowings (1,511.9) (1,497.1)

2002£m

2002£m

2001£m

2001£m

(1) Includes £48.6m adverse exchange (2001: £3.1m favourable exchange)(1) Includes £48.6m adverse exchange (2001: £3.1m favourable exchange)

Sao Paulo 11.6Gatwick 9.9Cologne - Scandic new build & rebrand 6.2Syndhaven - Scandic rebrand 2.7Barcelona 2.7Kalastajatorppa - refurbishment 2.4Zurich 2.0Other (all under £2m) 21.9Total Hotels 59.4Total LivingWell 5.5

64.9

Sao Paulo 11.6Gatwick 9.9Cologne - Scandic new build & rebrand 6.2Syndhaven - Scandic rebrand 2.7Barcelona 2.7Kalastajatorppa - refurbishment 2.4Zurich 2.0Other (all under £2m) 21.9Total Hotels 59.4Total LivingWell 5.5

64.9

BS 2000 EPOS system 1.6Numbers terminals 1.1eGaming / Telephone betting 3.9Other (including: acquisitions / new licences £1.8m,relocations £2.9m, refurbs / extensions £3.1m) 13.7

20.385.2

BS 2000 EPOS system 1.6Numbers terminals 1.1eGaming / Telephone betting 3.9Other (including: acquisitions / new licences £1.8m,relocations £2.9m, refurbs / extensions £3.1m) 13.7

20.385.2

HotelsHotels

Worldwide BettingWorldwide Betting

TotalTotal

2002£m

2002£m

Hilton Group plc - Analysis ofHilton Group plc - Analysis ofCapital ExpenditureCapital ExpenditureHilton Group plc - Analysis ofHilton Group plc - Analysis ofCapital ExpenditureCapital Expenditure

Successful bond issues:Successful bond issues:- Euro 500 million 6.5% due July 2009- Euro 500 million 6.5% due July 2009- Sterling 250 million 7.125% due July 2012- Sterling 250 million 7.125% due July 2012

Committed facilities:Committed facilities:- £1 billion surplus over gross debt- £1 billion surplus over gross debt- weighted average term of committed facilities is 4 years- weighted average term of committed facilities is 4 years

No financial ratio covenants in existing facility agreementsNo financial ratio covenants in existing facility agreements

Fixed interest rates on 50% of gross debt for a weighted average term of Fixed interest rates on 50% of gross debt for a weighted average term of 3 years3 years

Foreign currency assets hedged by borrowing inForeign currency assets hedged by borrowing inforeign currenciesforeign currencies

Successful bond issues:Successful bond issues:- Euro 500 million 6.5% due July 2009- Euro 500 million 6.5% due July 2009- Sterling 250 million 7.125% due July 2012- Sterling 250 million 7.125% due July 2012

Committed facilities:Committed facilities:- £1 billion surplus over gross debt- £1 billion surplus over gross debt- weighted average term of committed facilities is 4 years- weighted average term of committed facilities is 4 years

No financial ratio covenants in existing facility agreementsNo financial ratio covenants in existing facility agreements

Fixed interest rates on 50% of gross debt for a weighted average term of Fixed interest rates on 50% of gross debt for a weighted average term of 3 years3 years

Foreign currency assets hedged by borrowing inForeign currency assets hedged by borrowing inforeign currenciesforeign currencies

TreasuryTreasuryTreasuryTreasury

David MichelsDavid MichelsGroup Chief ExecutiveGroup Chief Executive

David MichelsDavid MichelsGroup Chief ExecutiveGroup Chief Executive

Hilton Group plcHilton Group plcHilton Group plcHilton Group plc

42.242.2

43.943.9

42.442.4

46.046.0

28.828.8

41.341.3

47.647.6

44.744.7

47.247.2

49.549.5

32.132.1

44.844.8

68.368.3

48.048.0

55.655.6

Revenue Per Available Room - Like for Like*Revenue Per Available Room - Like for Like* Revenue Per Available Room - Like for Like*Revenue Per Available Room - Like for Like*

20022002 20012001 GrowthGrowth 2002200220022002 20012001 GrowthGrowth

LondonLondon

ProvincesProvinces

Total United KingdomTotal United Kingdom

Europe & AfricaEurope & Africa

Middle East &Middle East &Asia PacificAsia Pacific

The AmericasThe Americas

Total HiltonTotal Hilton

Scandic brandedScandic branded

Total HotelsTotal Hotels

77.877.8

49.049.0

59.759.7

(11.3)%(11.3)%

(1.8)%(1.8)%

(10.2)%(10.2)%

(7.1)%(7.1)%

(10.3)%(10.3)%

(7.8)%(7.8)%

55.155.1

42.742.7

48.748.7

51.451.4

34.034.0

46.746.7

58.558.5

41.341.3

52.152.1

53.753.7

33.433.4

48.348.3

(5.8)%(5.8)%

3.5% 3.5%

(6.5)%(6.5)%

(4.3)%(4.3)%

1.8% 1.8%

(3.3)%(3.3)%

48.748.7

43.343.3

45.645.6

48.748.7

31.431.4

44.044.0

First QuarterFirst Quarter

20012001 GrowthGrowth

53.253.2

43.043.0

49.749.7

51.651.6

32.832.8

46.546.5

(8.4)%(8.4)%

0.8% 0.8%

(8.2)%(8.2)%

(5.7)%(5.7)%

(4.2)%(4.2)%

(5.4)%(5.4)%

Second QuarterSecond Quarter Six Months to JuneSix Months to June

Hilton branded:Hilton branded:

(12.2)%(12.2)%

(2.0)%(2.0)%

(6.9)%(6.9)%

74.074.0

51.551.5

59.859.8

85.685.6

52.952.9

65.065.0

(13.6)%(13.6)%

(2.6)%(2.6)%

(8.0)%(8.0)%

71.271.2

49.849.8

57.757.7

81.781.7

51.051.0

62.462.4

(12.8)%(12.8)%

(2.4)%(2.4)%

(7.5)%(7.5)%

*All at constant currencies, including a full 6 months of Scandic in 2001*All at constant currencies, including a full 6 months of Scandic in 2001

Hotels 214 278 144 139

Worldwide betting 30 40 40 53

Major property purchases 84 147 - -

Capital expenditure 328 465 184 192

Disposals - hotels (151) (13) (355) *

177 452 (171)

Hotels 214 278 144 139

Worldwide betting 30 40 40 53

Major property purchases 84 147 - -

Capital expenditure 328 465 184 192

Disposals - hotels (151) (13) (355) *

177 452 (171)

Cash 461 - 454

Shares 882 - 165

Cash 461 - 454

Shares 882 - 165

CapexCapexCapexCapex

Acquisitions (Stakis and Scandic)Acquisitions (Stakis and Scandic)

1999£m

1999£m

2000£m

2000£m

2001£m

2001£m

Forecast 2002£m

Forecast 2002£m

* Potential sale and leaseback deal* Potential sale and leaseback deal

Hotels - Property net book value £2.5bn £2.8bnHotels - Property net book value £2.5bn £2.8bn £2.6bn£2.6bn

Hilton International - PropertyHilton International - PropertyHilton International - PropertyHilton International - Property

Net Book Value movement over 4 yearsNet Book Value movement over 4 years

UK £1.8bn £1.9bn £1.6bn £1.6bn

Overseas £0.7bn £0.9bn £1.0bn £1.0bn

Total £2.5bn £2.8bn £2.6bn £2.6bn

UK £1.8bn £1.9bn £1.6bn £1.6bn

Overseas £0.7bn £0.9bn £1.0bn £1.0bn

Total £2.5bn £2.8bn £2.6bn £2.6bn

19991999 20002000 20012001 20022002

ScandicScandicScandicScandic

BrandingBrandingBrandingBranding

HiltonHilton

- 475 hotels in 70 countries (233 HHC)- 475 hotels in 70 countries (233 HHC)

- 40 more on the way- 40 more on the way

- Owned / management contract / leased- Owned / management contract / leased

HiltonHilton

- 475 hotels in 70 countries (233 HHC)- 475 hotels in 70 countries (233 HHC)

- 40 more on the way- 40 more on the way

- Owned / management contract / leased- Owned / management contract / leased

Scandic (mid-market)Scandic (mid-market)

- 137 hotels- 137 hotels

- Target 200 by end 2004- Target 200 by end 2004

- Management contract / leased / franchised- Management contract / leased / franchised

Scandic (mid-market)Scandic (mid-market)

- 137 hotels- 137 hotels

- Target 200 by end 2004- Target 200 by end 2004

- Management contract / leased / franchised- Management contract / leased / franchised

LivingWellLivingWell

UKUK 123,600123,600

InternationalInternational 16,02116,021

TotalTotal 139,621139,621

Current MembershipCurrent Membership

Half Year Shop Performance - UK and Half Year Shop Performance - UK and JerseyJerseyHalf Year Shop Performance - UK and Half Year Shop Performance - UK and JerseyJersey

19961996 19971997 19981998 19991999 20002000 20012001

Average numberof shops

PBIT £m 29.1 37.1 43.3 34.7 36.1 48.3 58.1

PBIT pershop £k 15.9 19.6 23.0 18.2 19.2 25.7 30.8

Average numberof shops

PBIT £m 29.1 37.1 43.3 34.7 36.1 48.3 58.1

PBIT pershop £k 15.9 19.6 23.0 18.2 19.2 25.7 30.8

1,831 1,892 1,892 1,910 1,879 1,883 1,8841,831 1,892 1,892 1,910 1,879 1,883 1,884

20022002

N.B. Excludes SIS contributionN.B. Excludes SIS contribution

Horses 13.5% 14.7% 12.7% 12.9%

Greyhounds 17.2% 16.8% 17.2% 15.7%

Football (3) 15.5% 23.2% 17.8% 15.9%

Sports 14.2% 12.8% 10.7% 10.7%

Numbers 24.4% 23.3% 24.3% 26.1%

Average 14.9% 15.9% 14.2% 14.0%

Horses 13.5% 14.7% 12.7% 12.9%

Greyhounds 17.2% 16.8% 17.2% 15.7%

Football (3) 15.5% 23.2% 17.8% 15.9%

Sports 14.2% 12.8% 10.7% 10.7%

Numbers 24.4% 23.3% 24.3% 26.1%

Average 14.9% 15.9% 14.2% 14.0%

20022002

UK Shops -UK Shops -Gross Profit Gross Profit (1)(1) Product margins - First Half Product margins - First HalfUK Shops -UK Shops -Gross Profit Gross Profit (1)(1) Product margins - First Half Product margins - First Half

2001 (2)2001 (2) 2000 (2)2000 (2)Average

’97 - ’00 (2)

Average’97 - ’00 (2)

(1) Gross profit is after duty / gross profits tax(1) Gross profit is after duty / gross profits tax(2) Adjusted for gross profits tax(2) Adjusted for gross profits tax(3) Excluding the World Cup the gross profit margin on football for 2002 was 18.4%(3) Excluding the World Cup the gross profit margin on football for 2002 was 18.4%

Shop InnovationShop InnovationShop InnovationShop Innovation

Further 14 shops recently purchased. 16 more in second halfFurther 14 shops recently purchased. 16 more in second half

EPOS drives improved efficiency, the new screen system and Fixed Odds Betting EPOS drives improved efficiency, the new screen system and Fixed Odds Betting Terminals (FOBT’s)Terminals (FOBT’s)

FOBT’s averaging £3,900 p/w per terminal sinceFOBT’s averaging £3,900 p/w per terminal sincenew bets introduction two months agonew bets introduction two months ago

Turnover +50% this year vs lastTurnover +50% this year vs last

Further 14 shops recently purchased. 16 more in second halfFurther 14 shops recently purchased. 16 more in second half

EPOS drives improved efficiency, the new screen system and Fixed Odds Betting EPOS drives improved efficiency, the new screen system and Fixed Odds Betting Terminals (FOBT’s)Terminals (FOBT’s)

FOBT’s averaging £3,900 p/w per terminal sinceFOBT’s averaging £3,900 p/w per terminal sincenew bets introduction two months agonew bets introduction two months ago

Turnover +50% this year vs lastTurnover +50% this year vs last

Budd Review and the Casino BusinessBudd Review and the Casino BusinessBudd Review and the Casino BusinessBudd Review and the Casino Business

Telephone Betting Telephone Betting Telephone Betting Telephone Betting

Year on Year Turnover GrowthYear on Year Turnover Growth

0%0%

10%10%

30%30%

40%40%

1999 vs 19981999 vs 1998

60%60%

2000 vs 19992000 vs 1999 2001 vs 20002001 vs 2000 2002 HY vs 2001 2002 HY vs 2001 HYHY

50%50%

20%20%

29%29%

6%6%

18%18%

55%55%

eGaming Gross WineGaming Gross WineGaming Gross WineGaming Gross Win

0.00.0

5.05.0

15.015.0

20.020.0

1st half 1st half 20002000

30.030.0

22ndnd half 2000 half 2000 22ndnd half half20012001

11stst half half20022002

25.025.0

10.010.0

0.30.3

2.82.8

10.410.4

26.826.8

£m£m

11stst half half20012001

15.915.9

Registered playersRegistered players 392,000392,000 65,00065,000 6,4006,400

ActiveActive 130,000130,000 28,00028,000 2,5002,500

CurrenciesCurrencies 1515 1515 1515

£ stake per bet / play£ stake per bet / play £19.17£19.17 £10.26£10.26 £35£35

LanguagesLanguages 1111 1111 11

Registered playersRegistered players 392,000392,000 65,00065,000 6,4006,400

ActiveActive 130,000130,000 28,00028,000 2,5002,500

CurrenciesCurrencies 1515 1515 1515

£ stake per bet / play£ stake per bet / play £19.17£19.17 £10.26£10.26 £35£35

LanguagesLanguages 1111 1111 11

eGamingeGamingeGamingeGaming

(Average pot)(Average pot)(Average pot)(Average pot)

SportsbookSportsbookSportsbookSportsbook CasinoCasinoCasinoCasino PokerPokerPokerPoker

(Played since 1 Jan 2002)(Played since 1 Jan 2002)(Played since 1 Jan 2002)(Played since 1 Jan 2002)

(Internet only)(Internet only)(Internet only)(Internet only)

MayMay JuneJune JulyJuly August to dateAugust to date

2929

4848

5656

6161

Poker - Average Rake Per WeekPoker - Average Rake Per WeekPoker - Average Rake Per WeekPoker - Average Rake Per Week

00

2020

4040

5050

7070

6060

3030

£k£k

1010

Total number of betsTotal number of bets 1.2 million1.2 million

TurnoverTurnover £21.6 million£21.6 million

Gross winGross win £2.5 million£2.5 million

Total number ofTotal number ofnew customer registrationsnew customer registrations 45,00045,000

% of business non-UK% of business non-UK 68%68%

Total number of betsTotal number of bets 1.2 million1.2 million

TurnoverTurnover £21.6 million£21.6 million

Gross winGross win £2.5 million£2.5 million

Total number ofTotal number ofnew customer registrationsnew customer registrations 45,00045,000

% of business non-UK% of business non-UK 68%68%

World Cup 2002World Cup 2002World Cup 2002World Cup 2002

Internet and Interactive TV BettingInternet and Interactive TV Betting

HotelsHotelsRebound / RevPAR PBIT increaseRebound / RevPAR PBIT increase

Peer / Yield premium to risePeer / Yield premium to rise

New income stream from midNew income stream from midmarket & resortsmarket & resorts

HotelsHotelsRebound / RevPAR PBIT increaseRebound / RevPAR PBIT increase

Peer / Yield premium to risePeer / Yield premium to rise

New income stream from midNew income stream from midmarket & resortsmarket & resorts

Upside / OUpside / OpportupportunitiesnitiesUpside / OUpside / Opportupportunitiesnities

BettingBettingFOBT income streamFOBT income stream

Budd Casinos / SlotsBudd Casinos / Slots

eGaming to doubleeGaming to double

Turnover increase / more steamTurnover increase / more steam

Telephone betting / opportunitiesTelephone betting / opportunities

BettingBettingFOBT income streamFOBT income stream

Budd Casinos / SlotsBudd Casinos / Slots

eGaming to doubleeGaming to double

Turnover increase / more steamTurnover increase / more steam

Telephone betting / opportunitiesTelephone betting / opportunities

Strong capex / cost controlStrong capex / cost control

Capital redeploymentCapital redeployment

EBITDA growth from invested capitalEBITDA growth from invested capital

Strong capex / cost controlStrong capex / cost control

Capital redeploymentCapital redeployment

EBITDA growth from invested capitalEBITDA growth from invested capital