1. Financial Results 4 March 2004

2. David Harding Chief Executive 2

3. Highlights, 52 weeks to 30 December 2003  Fourth consecutive year double digit earnings growth  Product diversification and increased betting opportunities  Fixed odds betting terminals  IT and estate development  Government and regulation 3

4. Earnings growth – gross wins £m% 1999200020012002200303/02CAGR Retail368384417419505218.3 Telephone4448 5157116.4 Interactive11735558555244.9 Group *4174525035286542411.9 * Includes other 4

5. Earnings growth – EBIT £m% 1999200020012002200303/025 yr CAGR Retail7282931121523620.6 Telephone1016 17222821.8 Interactive(3)(8)9213781- Group *74851121412024328.3 * Net of other and central costs 5

6. Product diversification – indicative share of gross wins 2003 Retail Telephone Sportsbook & Arcade Horses 45% Dogs 21% Terminals/ AWPs 20% Football 7% Numbers 7% Other sports * Horses 73% Football 18% Dogs 5% Other sports 4% Horses 36% Football 31% Other Sports 19% Numbers 7% Dogs 6% 6

7. Increased betting opportunities & extended opening - Retail Betting opportunities November Thursday 69 92 128 200020022003 20 UK Horses 30 Dogs 12 Numbers 18 Numbers 40 Dogs 14 O/seas horses 7 O/seas horses 20 UK Horses 14 O/seas horses 46 Dogs 48 Numbers 47 UK racing Sundays 100 % increase 105 UK racing evenings 50 % increase 2004 7

8. Fixed odds betting terminals  At end December we had 3239 FOBTs and 2454 AWPs in the estate  Average installed base throughout the year 2400 FOBTs, 2700 AWPs  Average weekly net profitability per terminal £380  Planning assumption for 2004, 3600 FOBTs and 1900 AWPs by mid year  Factors influencing average profitability:- Negative Positive Code of ConductDensity optimisation Competitor rolloutExtended opening Roll out to smaller shopsNew product development 8

9. Estate development ForecastCompleted New licences1413 Resites3328 Extensions1714 Facelifts/upgrades5670 120125 *20 Target new licence openers ‘04 * 47 New license applications in process 9

10. IT development  Retail technology programme -Electronic bet capture and settlement (EPOS) -New text information systems  Central bookmaking/single account 10

11. Government and regulation Pre-legislative scrutiny Gambling Commission Gaming issues Bookmaking issues  Definitions  Terminals  Exchanges  Bureaucracy 11

12. Tom Singer Group Finance Director 12

13. Presentation in four parts 13 1.Financial results FY2003 2.Return of capital 3.Guidance FY2004 4.Current trading

14. Summary of Financial Results FY03 v FY02 (pre-exceptional items) 14 FY03 £m FY02 £m Mvmt % Turnover (1) 5945.83365.376.7 Gross win (2) 654.3527.724.0 Gross win % betting business9.9%14.3%-4.4% GPT, duties, levies, royalties and other related costs(143.2)(111.7)-28.2 Gross profit (contribution)511.1416.022.9 Net operating expenses(312.3)(277.0)12.7 Associate income2.92.4 EBIT201.7141.442.6 EBITDA221.7158.839.6 (1) Includes casino drop and AWP cash-in-box net of VAT (2) Includes casino drop and AWP cash-in-box inclusive of VAT

15. Summary of Earnings and Dividends FY03 v FY02 (pre-exceptional items) 15 FY03 £m FY02 £m Mvmt % Profit before interest and taxation (EBIT)201.7141.442.6 Net interest payable(30.9)(59.9)48.4 Taxation(45.2)(22.9)-97.4 Profit after taxation125.658.6114.3 Dividend - Interim(14.6)(12.1) - Final(37.6)(24.2) (52.2)(36.3)43.8 Retained earnings73.422.3229.1 Earnings per share (pence) Basic30.016.977.5 Diluted29.616.876.2

16. Analysis of Gross Win FY03 v FY02 16 1H03 £m 1H02 £m Mvmt % 2H03 £m 2H02 £m Mvmt % YoY mvmt % Retail (1) 253.7215.7+18251.9203.2+24+21 Telephone28.327.5+328.223.4+21+11 Interactive (2) 38.629.3+3246.325.6+81+55 Other (3) 3.41.2+1833.91.8+117+143 Group324.0273.7+18330.3254.030.0+24 (1) Includes traditional OTC business, AWPs and FOBTs (2) Includes Sportsbook, Casino and Poker (3) Includes greyhound stadia, Course and Group Promotions

17. Taxes and Duties FY03 v FY02 17 FY03 £m FY02 £m Mvmt % GPT86.770.822 Levies27.727.03 Royalties22.26.8226 VAT/machine duty/other6.67.1-7 143.2111.728

18. Net Operating Expenses FY03 v FY02 18 FY03 £m FY02 £m Mvmt % Staff costs Property costs Depreciation Pictures and data Advertising and Sponsorship RoutineRetail/Telephone/Group Interactive World Cup AWP/FOBT rental Finance charges (incl chargebacks) Communications Other (1) 155.2 47.3 18.4 18.2 6.4 13.3 - 8.7 7.0 5.2 32.6 143.0 41.5 16.7 16.4 5.6 7.8 2.1 7.5 4.1 4.0 28.3 8.5 14.0 10.2 11.1 15.6 69.4 16.6 68.6 30.0 15.2 Operating expenses Less: costs allocated to Trading Divisions 312.3 (298.5) 277.0 (265.5) 12.7% 12.4% Central costs (2) 13.811.520.0% (1) Includes printing and stationery, legal, consultancy, cleaning and miscellaneous other costs (2) Primarily central support functions and property costs

19. Underlying Growth in Operating Expenses FY03 v FY02 19 FY03 £m FY02 £m Mvmt % Total operating expenses312.3277.013 Less: Extended trading Increase in Casino/Poker advertising World Cup advertising H & K shops/stadia acquisitions FOBT installation/infrastructure costs FOBT/AWP rental Retail Technology Programme Assets write offs and other non recurring costs PLC costs including management incentivisation (4.8) (5.5) - (7.5) (2.2) (2.4) (1.1) (10.1) - (2.1) (1.4) - (1.2) - (6.1) Adjusted operating expenses277.6266.24

20. Profit Conversion (trading profit as a % of gross win) FY03 v FY02 20 FY03 % FY02 % Retail30.126.7 Telephone39.334.0 Interactive43.737.3

21. Retail: Results FY03 v FY02 21 20032002 Gross win +21 % Operating profit +36 % Growth rate (Y on Y)  Continuing benefit of GPT regime/recycling  Continuing strong growth in Numbers (virtual racing, FOBTs) betting  Extended trading hours  13 new licences for LBOs and 112 other development actions

22. Telephone: Results FY03 v FY02 22  171,000 active accounts (31 December 2002: 164,000)  Good growth despite poor Cheltenham Festival, no major football championship and betting exchanges  Costs down by £0.6m due to closure of Athlone call centre (April 2002) and improving efficiency in Leeds/Sheffield call centres 20032002 Gross win +11 % Operating profit +28 % Growth rate (Y on Y)

23. Interactive (1) : Results FY03 v FY02 23 2003 2002 (1) Sportsbook, Casino and Poker  247,000 active accounts (31 December 2002 :173,000) Sportsbook  Focus switching back to UK/selected European markets  Growing contribution from Arcade games  No major football championship in 2003 Casino and Poker  Launch of hosted poker (January 2003)  Launch of integrated sportsbook/casino account and language/Euro casinos in Autumn 2003  Multi-supplier strategy Gross win +55 % Operating profit +81 % Growth rate (Y on Y)

24. Cash Generation: FY03 v FY02 (pre-exceptional items) 24 FY03 £m FY02 £m EBIT201.7141.4 Associate income(2.9)(2.4) Associate dividend-5.7 Depreciation/amortisation20.016.7 Working capital/other (1) 7.8(4.1) Capital expenditure - routine(18.5)(20.4) - acquisitions(4.9)(20.8) Cash taxes(33.4)(9.5) Free cashflow169.8106.6+59% Net indebtedness366.1481.4 (1) Working capital benefit in FY2003 due to increase in GPT and PAYE creditors and client balances

25. Presentation in four parts 25 1.Financial results FY 2003 2.Return of capital 3.Guidance FY2004 4.Current trading

26. Return of Capital 26  Returning value to shareholders v flexibility for acquisitions  Share buy back is but one possible solution  Shareholder authority for: - Buy back of up to 10% of issued share capital - Hold in treasury up to 2.5% of issued share capital  Board to keep method, timing and quantum under review

27. Presentation in four parts 27 1.Financial results FY 2003 2.Return of capital 3.Guidance FY2004 4.Current trading

28. Guidance FY2004 28  3600 FOBTs and 1900 AWPs by June 2004  LBO extended trading  Cheltenham/Euro 2004  Retail Technology Programme (RTP) – revenue costs £3m in FY2004  Capex – RTP: £10m; ‘Routine’: £23m  Effective interest rate: 6.5%  Effective tax rate: 29%

29. Presentation in four parts 29 1.Financial results FY 2003 2.Return of capital 3.Guidance FY2004 4.Current trading

30. Current Trading 30  Encouraging start to the current year  Group gross win up 17%; double-digit growth all three channels  Operating expenses up 13%  All three channels well positioned with clear strategies for growth

31. Q & A