1. MAY 2002
INTERIM RESULTS 2002
9 May 2002

2. Holidaybreak plc INTERIM RESULTS 2002
Results Overview
Financial Review
Current Trading and Prospects
Future Strategy

3. Interim Announcement 2002 HALF-YEAR RESULTS
£5.9m loss is entirely normal (2001 : £6.7m)
Hotel breaks - substantial growth at the top line margin improvement
Adventure - pleasing sales performance following post September 11th disruption
- reduced margins due to load factor pressures
Camping - similar loss to 2001
Interest charge down
Substantial net debt reduction

4. Interim Announcement 2002 CURRENT TRADING AND PROSPECTS
Camping outperforming mainstream AIT operators - 6% better than 2001
Hotel Breaks sales growth continuing strongly - 30% ahead of 2001
Adventure will achieve a creditable result in a difficult year - 2% up on 2001
Overall prospects for the year are good - further earnings and dividend growth anticipated

5. Interims 2002 PROFIT AND LOSS ACCOUNT
(six months to 31 March 2002)
All stated before goodwill amortisation

6. Interims 2002 PROFIT AND LOSS ACCOUNT- DIVISIONAL ANALYSIS
(six months to 31 March 2002)
All stated before goodwill amortisation

7. Interims 2002 BALANCE SHEET

8. Interims 2002 CASH FLOW
(six months to 31 March 2002)

9. Interims 2002 CAMPING - HALF-YEAR RESULTS
Seasonal nature of business means a loss in the first half is inevitable
All sales taken in the second period - over 80% of forward bookings for the summer season received by 31st March
Costs are for overheads and marketing

10. Interims 2002 CAMPING - CURRENT TRADING AND PROSPECTS
Like for like sales 6% up on 2001 with over 85% of estimated final total received
UK, the largest and most profitable market, 8% up
Resilient performance from Holland
German bookings down, partly due to market weakness but also school holiday patterns which change annually

11. Interims 2002 CAMPING - CURRENT TRADING AND PROSPECTS
Low season has held up well
Confident that late August capacity will fill in a strong late bookings market
Small margin improvement anticipated

12. Interims 2002 CAMPING - STRATEGY
Ongoing evolution from tent to mobile-home accommodation in all markets will continue to support profits and margin growth
Product development - Fun Station, low season products, fly/drive
Dual brand strategy to continue with Eurocamp brand positioned to appeal to the mainstream self-catering customer whilst Keycamp maintains current positioning
Camp-site owned capacity an increasing feature but no significant inroads into UK market

13. Interims 2002 HOTEL BREAKS - HALF-YEAR RESULTS
First half sales increase of 25%
Effect of lower London hotel prices on average invoice values counterbalanced by increased rail inclusive sales and reduced numbers of low value airport hotel bookings
Margin improvements due to effective cost controls, scale economies and improved mix -ie.direct sales and internet
Successful launch of European hotels programme - second edition brochure just released
Valuable contribution to group cash flows
- benefits of negative working capital

14. Interims 2002 HOTEL BREAKS - CURRENT TRADING AND PROSPECTS
Strong trading pattern continuing - currently domestic break sales at plus 30% on 2001
European break sales increasing as late spring/early summer bookings continue
London hotel market (over 35% of sales) still relatively soft and so providing plentiful capacity and attractive rates
But all regions showing healthy growth

15. Interims 2002 HOTEL BREAKS - CURRENT TRADING AND PROSPECTS
All distribution channels growing but directs and internet (in particular) growing faster than high street retail
Economies of scale and reduced share of high street agency sales will result in better year end margin
Acquisition of Crystal Britain, the UK hotel breaks division of Thomson (now TUI) will increase share and distribution in UK travel agencies and provide direct marketing opportunities

16. Interims 2002 HOTEL BREAKS - STRATEGY
Continue to support core high street agency distribution channel whilst growing internet and directs share of overall sales
Active development of new product extensions (events, theatre packages etc) and distribution partnerships - rail companies, internet portals hotel chains, tourist authorities, affinity groups etc
Second year European programme will double original hotel numbers to 750 and extend destination range from 30 to 55-60
Build on current inbound sales
Appropriate bolt-on acquisitions

17. Interims 2002 ADVENTURE - HALF-YEAR RESULTS
Explore’s pre-Christmas sales held up reasonably well due to strong pre-September 11th start to the campaign - post September 11th new booking activity was sparse and cancellations heavy
Load factors hit by customer cancellations, tour transfers and airline schedule changes
Second quarter sales figures benefited from earlier Easter
Regal achieved excellent load factor returns albeit at lower values and margins
First half result somewhat better than we anticipated at time of 2001 results announcement

18. Interims 2002 ADVENTURE - CURRENT TRADING AND PROSPECTS
Current total 2002 sales 2% up on 2001 equivalents. Weekly trends up year on year
Explore’s third quarter year on year comparisons affected by earlier Easter and weakness in lower margin overseas agent bookings (USA, Canada, Australia etc) which tend to concentrate into early summer period
Fourth quarter is stronger and both periods will benefit from greater than normal late booking activity which is characterising the current campaign and the market in general

19. Interims 2002 ADVENTURE - CURRENT TRADING AND PROSPECTS
Reduced charter capacity will limit potential upside for Regal but overall performance will exceed post September 11th expectations
Full year divisional profits will be lower than last year’s figure but we
anticipate a creditable result in a very difficult
year

20. Interims 2002 ADVENTURE - STRATEGY
Concentrate on growing existing profitable tours
More short tours and European capacity
Separate “Walking and Trekking” product
Product extensions - specialist tours, family adventures, tailor made
Improve internal systems and processes to achieve processing efficiencies and support development plans
Reduce Regal’s dependence on Red Sea charters through schedule carrier based offers to other destinations
Fragmented sector offers acquisition possibilities

21. UK Holiday Sector 2001/2 TRADING
Volume sales for both winter and summer 2002 down on 2001 by c.10% - particular weakness in family holidays
Summer 2002 has been strengthening but May/June remains a problem
Capacity cuts on air charters appear to be holding
Many independent operators having an excellent year
Low cost airline traffic and tailor-made holidays growing rapidly
Late bookings strong - not just price driven

22. UK Holiday Sector INDUSTRY DEVELOPMENTS
Four major players in UK: Thomson (TUI/Preussag), My Travel (Airtours), Thomas Cook (C&N) and First Choice - 70% share of inclusive holidays sold and own 45% of high street agents
Vertical integration
exposed by recent
industry trends but
further consolidation
likely

23. UK Holiday Sector INDUSTRY DEVELOPMENTS
Many specialist operators and independent agents continue to thrive
Low cost airlines (Easyjet, Ryanair, Go etc) have challenged existing industry model and changed consumer behaviour
Distribution channels fragmenting - internet, teletext, TV channels, Off the page

24. UK Holiday Sector CONSUMER TRENDS
Consumers - more knowledgeable, more demanding, less brand loyal
Independent and tailor made holidays increasingly favoured
Increase in multiple holiday taking and short breaks (domestic and overseas)
‘Grey’ market increasing in importance
Other growth areas are long-haul and activity/
special interest
Late booking trends partly driven by bargain hunting and partly by lifestyle changes and more frequent travel

25. UK Holiday Sector GROWTH IN OVERSEAS HOLIDAYS, 1991-2001
(Short breaks = 1-3 nights)
Source: Mintel (2002)
UK HOLIDAY MARKET

26. UK Holiday Sector GROWTH IN DOMESTIC HOLIDAYS, 1991-2001
Source: Mintel (2002)
(Short breaks = 1-3 nights)
UK HOLIDAY MARKET

27. Holidaybreak plc GROUP POSITIONING AND STRATEGY
Quality market leading businesses in sectors with good growth potential
Avoid volatile, low margin, short-haul package holiday market
Organic growth combined with ‘bolt-on’ acquisitions to existing divisions and acquisition of travel businesses in new sectors
Characteristics of Group businesses provide an excellent platform for growth and acquisition template

28. Holidaybreak plc COMMON CHARACTERISTICS
Market Leading businesses - Eurocamp, Keycamp, Superbreak, Explore Worldwide and Regal
Growth opportunities - in all divisions
Healthy margins - much higher than sector norm
Low fixed cost commitments - flexible business models
Strongly cash generative - especially Hotel Breaks and Adventure

29. Holidaybreak plc DIVISIONAL STRUCTURE AND BRANDS
Adventure
Camping
Hotel Breaks

30. Interims 2002 OVERVIEW AND SUMMARY
Half year results show impressive performance by Hotel Breaks and reduced net debt
Further profits and dividend growth in 2002
Camping and Hotel Breaks positioned for further growth in 2003 whilst Adventure should recover lost ground
Holidaybreak well placed to benefit from current holiday sector trends - very strong cash generation a key characteristic of the business
We view the future with confidence