Lavendon Group plc 2006 Preliminary Results Presentation March 2007

2 Agenda Highlights Financial performance Cash flow and debt management Strategy and trading review Summary and outlook

3 Agenda Highlights Financial performance Cash flow and debt management Strategy and trading review Summary and outlook

4 Highlights Results ahead of expectations: Revenue increased by 25% EBITDA increased by 29% Operating profit increased by 74% Four acquisitions completed in the year at a cost of £55.2m UK growing revenues and margins German turn-around accelerating Middle East market continues to be strong Dividend doubled

5 Agenda Highlights Financial performance Cash flow and debt management Strategy and trading review Summary and outlook

6 Summary of 2006 Preliminary Results

7 Group Turnover 2006 UK growth driven by acquisitions and better utilisation of combined fleets German growth rates accelerated in 2 nd half Growth in Middle East driven by increased fleet in response to demand Acquisitions £19.4m

8 Group Operating Profit UK margins improved through acquisitions and efficiency of existing business German revenue growth now reducing losses at a greater rate Middle East profits suppressed by transport and duty costs in the year Acquisitions £3.5m

9 Group Profit Before and After Tax PBT increased by over 2.5x, despite higher interest costs PAT benefited from low effective tax rate of 12%, due to increased scope to use German tax losses

10 Earnings and Dividend per Share Number of shares in issue increased by 10% during the year, following acquisitions EPS increased seven fold with tax benefit, almost six fold on a normalised basis Final dividend proposed of 3.00 pence, making total dividend 4.50 pence Dividend is covered 3.8 times under UK GAAP (2.9 times without tax benefit)

11 Agenda Highlights Financial performance Cash flow and debt management Strategy and trading review Summary and outlook

12 EBITDACash Generated from Operations EBITDA and Cash Flow for %29.8%30.7% EBITDA Margin % Acquisitions £5.9m

13 Application of Cash Flow

14 Capex and Depreciation No changes to depreciation policies Capex includes £11.9m settlement of lease residuals Expansion capex directed at Middle East and UK Depreciation as a % of revenue reduced to 20.6% from 22.4%

15 Acquisitions

16 Financing Issued equity to vendors of businesses acquired raising £9.4m Increased bank facility to £99m, with further scope for reducing margins Current net debt at a comfortable level, with gearing at 105% (2005: 80%) and 2.58 debt to EBITDA ratio Interest cover: –7.8x EBITDA –7.5x cash generated from operations –2.6x operating profit Blended interest rate is 5.05% Level of net debt and Debt to EBITDA Ratio

17 Agenda Highlights Financial performance Cash flow and debt management Strategy and trading review Summary and outlook

18 Strategy for Growth Having established a strong operational platform in the UK and Germany our principal focus is to consolidate our position in those markets Further investment in the Middle East strengthens our position as market leader and generates excellent returns Our investment strategy in France and Spain will be governed by our own business’ performance, other opportunities and our evaluation of market dynamics “Building scale intelligently”

19 Market Review - UK Market steady at the start of the year but improved as the year progressed Forecasts for market growth are solid, supported by major construction projects Manufacturer lead times remain extended for most equipment types

20 Business Review - UK Approach during the year has been to: Acquire market capacity when opportunities arise that meet specific criteria Secure revenue streams of acquired businesses Increase overall asset utilisation through re-hire operations Target expansion investment into growing market sectors Enhance margins of existing business through efficient operation and fleet re-balancing

21 UK - Review Revenues up 33% to £81.3m (£61.1m) Operating profits up 47% to £12.2m (£8.3m), with margins up from 14% to 15% Existing business improved margins from 13.6% to 14.2% Acquired businesses produced £3.5m of operating profit at a margin of 17.6% Inter-company rehire generated £1.0 m of the additional margin Units on Hire Revenue/Unit on Hire - Index

22 Market Review - Germany BBI forecast market value growth in Germany at around 3.5% in 2006 “The market has been improving recently and our members report positive expectations for 2007, as a result of the improved economic situation in Germany as a whole, and in construction in particular” – German industry association Forecasts for market growth are now above those for the UK, and ability to add capacity is limited in the short term

23 Market Review -Germany Source: Chalcraft consulting The German market has been working through an historic over-supply problem. Competitors’ capital constraints, market consolidation and manufacturers’ capacity constraints, together with stronger market conditions should see this situation ease

24 Business Review - Germany Approach during the year has been to: Stabilise staffing and service levels following restructure in previous year Provide platform for targeted rate increases as market improved Work to further reduce the overhead burden of the business Facilitate step-change in performance through acquisition

25 Germany - Review Revenues increased by 3% to £21.8m (£21.1m), with rate of increase accelerating in the 2 nd half Losses reduced to £1.9m (£3.2m) Acquisition of Gardemann doubles scale of business Integration now under way, with £2.4m of annualised synergies expected Units on Hire Revenue/Unit on Hire - Index

26 Business Review – Middle East Market review undertaken and decisions made to: Increase scale of business to benefit from market strength, whilst maintaining underlying margins Improve returns by using refurbished ex-European equipment wherever possible Support growth by strengthening management, engineering resources and IT systems

27 Middle East - Review Revenue increased 37% to £10.3m (£7.5m) Fleet increased by 75% across the year to 740 units, further 300 additions planned in 1 st half of 2007 Operating profits were £2.5m (£2.7m) Profitability subdued by fleet increase, as transport and import duty costs of £0.5m were incurred (one-off cost) Group ERP system to be implemented in H Revenue/Unit on Hire - Index Units on Hire

28 France - Review Revenue increased by 6% to £7.1m (£6.7m) Operating loss marginally reduced to £493,000 (£521,000) Depot network reduced to six key locations with increased average fleet size No further investment until operation becomes profitable Units on Hire Revenue/Unit on Hire - Index

29 Spain - Review Revenues up 17% to £4.2m (£3.6m), driven mainly by rate increases Operating profit of £0.4m (breakeven) A small business but well managed and now profitable, with scope for further growth Units on Hire Revenue/Unit on Hire - Index

30 Agenda Highlights Financial performance Cash flow and debt management Strategy and trading review Summary and outlook

31 Summary and Outlook Market situation improving in all main markets Acquisitions performing well Profitability and margins improving Debt : EBITDA ratio at a comfortable level Financial headroom exists to support further growth Structural solution to “German problem” implemented Trading in the new year has been strong and provides optimism for the remainder of the year

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