Interim Results Presentation 28 August 2003

Brian Wallace Deputy Group Chief Executive and Group Finance Director

Hilton Group plc - Summary of Performance Hotels (42.6)% Worldwide Betting % Central costs and income(6.6)(6.6) Operating profit (1) (9.8)% Interest(40.8)(37.7)(8.2)% Profit before tax (1) (15.0)% Effective tax rate (1) 22.0%22.0% EBITDA (1) (7.4)% EPS5.5p6.4p(14.1)% Hotels (42.6)% Worldwide Betting % Central costs and income(6.6)(6.6) Operating profit (1) (9.8)% Interest(40.8)(37.7)(8.2)% Profit before tax (1) (15.0)% Effective tax rate (1) 22.0%22.0% EBITDA (1) (7.4)% EPS5.5p6.4p(14.1)% 6 months to 30 June 2003 £m 6 months to 30 June 2003 £m 6 months to 30 June 2002 £m 6 months to 30 June 2002 £m Variance B(W) Variance B(W) (1) Before goodwill amortisation and exceptional items

Hotels - Like for Like Profit Reported profit (1) (42.6)% Sale and leaseback rent11.6- Sale and leaseback associate (3.7)- Closed for refurbishment1.5(1.9) Disposals / new openings Foreign exchange(2.8)- Like for like profit (1) (32.1)% Reported profit (1) (42.6)% Sale and leaseback rent11.6- Sale and leaseback associate (3.7)- Closed for refurbishment1.5(1.9) Disposals / new openings Foreign exchange(2.8)- Like for like profit (1) (32.1)% 2003 £m 2003 £m % change % change 2002 £m 2002 £m (1) Before goodwill amortisation and exceptional items

Hotels Worldwide Occupancy, Rate and RevPAR Performance vs 2002 Like for Like Hotels, Constant Currencies Including Scandic March / April have been combined to avoid the distortion caused by the timing of Easter

Worldwide RevPAR by Ownership Type Like for Like Hotels, Constant Currencies RevPAR growth 2003 vs 2002

Hotels - Cost Management Like for Like, Constant Currencies (1) Before exceptional items and goodwill amortisation Revenue movement(41.2)42.9(84.1) GOP movement (1) (44.5)25.2(69.7) Incremental conversion (8.0)%58.7% 17.1% Rental & Owners return18.8 Depreciation / FF&E3.0 Insurance(1.8) Other(6.6) Operating profit decline (1) (31.1) Revenue movement(41.2)42.9(84.1) GOP movement (1) (44.5)25.2(69.7) Incremental conversion (8.0)%58.7% 17.1% Rental & Owners return18.8 Depreciation / FF&E3.0 Insurance(1.8) Other(6.6) Operating profit decline (1) (31.1) Total £m Total £m Increasing revenue £m Increasing revenue £m Declining revenue £m Declining revenue £m

UK Hotels RevPAR Performance vs 2002 Like for Like Hotels March / April have been combined to avoid the distortion caused by the timing of Easter

Continental Europe (exc. Scandic branded) RevPAR vs 2002 Like for Like, Constant Currencies March / April have been combined to avoid the distortion caused by the timing of Easter

Scandic RevPAR Progression Like for Like Hotels, Constant Currencies, Scandic acquired RevPAR growth 2003 vs 2002 RevPAR growth 2003 vs 2002 March / April have been combined to avoid the distortion caused by the timing of Easter

Scandic Performance 2003 vs 2002 Revenue (9.2)(1.0) GOP (7.8)(2.9)1.3(1.2) (b) Inc. conversion44.9%15.1% Profit (7.2)(3.0)0.9(1.8) Non-recurring items (c) (1.2) 6.3 Revenue (9.2)(1.0) GOP (7.8)(2.9)1.3(1.2) (b) Inc. conversion44.9%15.1% Profit (7.2)(3.0)0.9(1.8) Non-recurring items (c) (1.2) 6.3 Like for like revenue gainers (a) £m Like for like revenue gainers (a) £m (a) At constant currencies (b) Support office costs not allocated to individual hotels (c) 2002 one-off credits Re- brands (a) £m Re- brands (a) £m New opened / closed (a) £m New opened / closed (a) £m Marketing & support costs (a) £m Marketing & support costs (a) £m 2002 Actual £m 2002 Actual £m 2003 Actual £m 2003 Actual £m Like for like revenue losers (a) £m Like for like revenue losers (a) £m F.x. £m F.x. £m

Worldwide Betting UK Retail Ireland & Belgium Telephone Betting - excluding high rollers high rollers(1.6)1.0(1.2) eGaming Vernons Worldwide Betting UK Retail Ireland & Belgium Telephone Betting - excluding high rollers high rollers(1.6)1.0(1.2) eGaming Vernons Worldwide Betting £m 2003 £m 2002 £m 2002 £m 2003 £m 2003 £m 2002 £m 2002 £m Operating Profit (1) Gross Win (1) Before goodwill amortisation and exceptional items

UK Retail 2003 £m 2003 £m 2002 £m 2002 £m Gross win (1) % Duty / Gross profits tax(40.2)(36.5) Other costs(151.3)(142.0) Operating profit % Staff costs per slip 31.72p29.56p(7.3)% Stake per slip (2) £8.24£ % Gross win (1) % Duty / Gross profits tax(40.2)(36.5) Other costs(151.3)(142.0) Operating profit % Staff costs per slip 31.72p29.56p(7.3)% Stake per slip (2) £8.24£ % Better (worse) % Better (worse) % (1) Gross win is before duty / gross profits tax are deducted (2) Excluding machines

Cost Conversion UK Retail72.6%26.4%54.0%39.8% Worldwide Betting60.4%31.7%51.9%41.6% UK Retail72.6%26.4%54.0%39.8% Worldwide Betting60.4%31.7%51.9%41.6% 2003 First Half 2003 First Half Conversion of Gross Profit Growth to Operating Profit 2002 First Half 2002 First Half 2002 Second Half 2002 Second Half 2002 Full Year 2002 Full Year

Telephone Betting (excluding high rollers) 2003 £m 2003 £m 2002 £m 2002 £m Gross win (1) % Duty / Gross profits tax(2.2)(2.1) Other costs(7.7)(8.0) Operating profit % Average stake per call £77.75£83.26(6.6)% Salary cost per call 67.2p71.3p5.8% No. of calls (000’s) 3,060 2, % Active customers (000’s) (2) % Gross win (1) % Duty / Gross profits tax(2.2)(2.1) Other costs(7.7)(8.0) Operating profit % Average stake per call £77.75£83.26(6.6)% Salary cost per call 67.2p71.3p5.8% No. of calls (000’s) 3,060 2, % Active customers (000’s) (2) % Better (worse) % Better (worse) % (1) Gross win is before duty / gross profits tax are deducted (2) Active customers are those who placed a bet during the period

eGaming Gross win (1) % Duty / Gross profits tax(1.5)(1.9) Other costs(23.1)(19.8) Operating profit % Active customers (000’s) (2) Sportsbook % Casino % On-line registrations (000’s) (15.6)% Gross win (1) % Duty / Gross profits tax(1.5)(1.9) Other costs(23.1)(19.8) Operating profit % Active customers (000’s) (2) Sportsbook % Casino % On-line registrations (000’s) (15.6)% 2003 £m 2003 £m 2002 £m 2002 £m (1) Gross win is before duty / gross profits tax are deducted (2) Active customers are those who placed a bet during the period Better (worse) % Better (worse) %

eGaming Gross Win by Region UKFar EastEuropeOther

Hilton Group plc - Cash Flow Cash inflow from operating activities Interest, tax and dividends paid(155.9)(132.2) Free cash flow Capital expenditure(101.8)(85.2) Free cash flow after capex(31.2)(5.6) Proceeds from asset sales Acquisitions / disposals-3.5 (30.4)5.6 Exchange and other movements (1) (87.9)(43.6) Net borrowings movement (118.3)(38.0) Opening net borrowings(1,164.8)(1,473.9) Closing net borrowings(1,283.1)(1,511.9) Cash inflow from operating activities Interest, tax and dividends paid(155.9)(132.2) Free cash flow Capital expenditure(101.8)(85.2) Free cash flow after capex(31.2)(5.6) Proceeds from asset sales Acquisitions / disposals-3.5 (30.4)5.6 Exchange and other movements (1) (87.9)(43.6) Net borrowings movement (118.3)(38.0) Opening net borrowings(1,164.8)(1,473.9) Closing net borrowings(1,283.1)(1,511.9) 2003 £m 2003 £m 2002 £m 2002 £m (1) Includes £88.5m adverse exchange (2002: £48.6m adverse exchange), intangible additions £2.1m (2002: £0.2m) and dividends from associates £2.9m (2002: £0.3m)

Hilton Group plc - Analysis of 2003 Capital Expenditure Acquisition linked development: Luxembourg (hotel acquisition)15.8 HK Copenhagen (acquisition)12.9 Sydney (refurb)9.0 Dusseldorf (refurb) Other 31.9 Total Hotels74.3 Total LivingWell Acquisition linked development: Luxembourg (hotel acquisition)15.8 HK Copenhagen (acquisition)12.9 Sydney (refurb)9.0 Dusseldorf (refurb) Other 31.9 Total Hotels74.3 Total LivingWell Shop transmission system & TVs9.6 Development 7.0 Other (including EPOS £1.0m)5.9 eGaming / Telephone betting3.5 Total Worldwide Betting Shop transmission system & TVs9.6 Development 7.0 Other (including EPOS £1.0m)5.9 eGaming / Telephone betting3.5 Total Worldwide Betting Hotels Worldwide Betting £m Total Group

David Michels Group Chief Executive

July / August Trading Hotels  UK - Improving  Europe- Weak  Middle East- Steady progress  Asia Pacific - Improving  Americas - Mixed performance; Caribbean stronger Betting - Excluding FOBTs underlying business growing steadily

Costs Head office – Maintained at low levels Betting – Strictly controlled with good conversion ratios Hotels – Looking for further improvement wherever possible

CapexCapex: Hotels Hotels Betting Betting Major property purchases (1) Capital expenditure Disposals - hotels (13)(355)(335)- 452(171)(147)102 Capex: Hotels Hotels Betting Betting Major property purchases (1) Capital expenditure Disposals - hotels (13)(355)(335)- 452(171)(147) £m 2000 £m 2001 £m 2001 £m 2002 £m 2002 £m H £m H £m FYF 2003 £m FYF 2003 £m (1) Including acquisition linked development

Scandic Operating environment remains tough particularly in Sweden Rebranding programme on hold Performing better than the competition

Franchising Scandic to be franchised in Northern Europe Launch on 1 January, 2004 Franchising of Hilton brand progressing

The Key Issues FOBTs – What next? Betting Exchanges – A level playing field? Hotel trading – Visibility remains poor

FOBTs Popular innovation following the removal of customer tax Judicial declaration expected Q1 2004

Betting Exchanges “We are not against betting exchanges, we are against an uneven playing field”

Outlook Hotels - Will recover. Time and pace of recovery still uncertain Betting - Maintain steady growth in the underlying business

Interim Dividend “Maintained at last year’s level reflecting confidence in the brands and their future prospects” 3.4 pence per share

Appendices

No. of hotels No. of rooms17,40610,01633,27136,740-97,433 Turnover ,270.5 Gross operating profit Less: Rental & owners return(1.8)(35.3)(82.2)(150.7)(1.8)(271.8) Depreciation(25.4)(11.6)(14.9)-(2.4)(54.3) Other costs / income(24.5)(4.5)(26.2)-(2.3)(57.5) 2003 Profit34.9(0.6) Profit Hotels - First Half Analysis by Contract Type Fixed lease Fixed lease Owned Contingent lease Managed LivingWell Total £m

RevPAR Change Geographically by Ownership Type vs 2002 Owned & fixed lease Contingent lease Managed Like for Like, Constant Currencies UK(5.2)%(5.3)%(9.4)% Europe & Africa(8.8)%0.7%(7.0)% Middle East & Asia Pacific 19.6%11.3% (9.4)% Americas(11.6)%29.1%7.1% Total(6.6)%0.7%(7.0)% UK(5.2)%(5.3)%(9.4)% Europe & Africa(8.8)%0.7%(7.0)% Middle East & Asia Pacific 19.6%11.3% (9.4)% Americas(11.6)%29.1%7.1% Total(6.6)%0.7%(7.0)%

Hilton vs London Market Cumulative Year to Date RevPAR Premium Market Source: PKF Hotel Consultancy Services

Hilton vs Provincial UK Market Cumulative Year to RevPAR Premium Cumulative Year to Date RevPAR Premium Market Source: PKF Hotel Consultancy Services

Resort Hotels, Occupancy, Rate and RevPAR Performance vs 2002 Like for Like, Constant Currencies March / April have been combined to avoid the distortion caused by the timing of Easter

Worldwide Betting - Revenue UK Retail (1) 2,562.21, % Ireland & Belgium % Telephone Betting % eGaming % Vernons (0.7)% Worldwide Betting3,180.31, % UK Retail (1) 2,562.21, % Ireland & Belgium % Telephone Betting % eGaming % Vernons (0.7)% Worldwide Betting3,180.31, % 2003 £m 2003 £m 2002 £m 2002 £m Growth % Growth % (1) Includes FOBT turnover, year on year increase £1,160.6m.

eGaming Gross Win

Hotels Betting & Gaming Property Total Also c. £14m other operating lease commitments Hotels Betting & Gaming Property Total Also c. £14m other operating lease commitments Breakdown of Lease Commitments Fixed lease £m Fixed lease £m Minimum guarantee £m Minimum guarantee £m Contingent lease £m Contingent lease £m Total £m Total £m Forecast land and buildings full year lease commitments for 2003 Forecast contingent commitments based on 2003 forecast results