Senior Management Review

Results and dividend

I am delighted to announce that we traded strongly throughout the year and that our results are at the top end of market expectations. All divisions provided a healthy contribution. We have delivered 10% earnings growth and increased the Group margin to 7.9%.

Revenue was £2.6 billion (2006: £2.5billion) and normalised Group operating profit was £205.6 million (2006: £184.8million). After interest and the Group’s share of profits from associated undertakings, normalised profit beforetax was £177.0 million (2006: £156.1 million). Normalised diluted earnings per share from continuing operations were 83.9 pence (2006: 76.5 pence).

We are recommending a final dividend of 26.4 pence per ordinary share (2006: 24.0 pence), an increase of 10%, to be paid on 9 May 2008 to shareholders on the register at 25 April 2008. Including the interim dividend, the proposed total dividend for the year is 37.96 pence (2006: 34.75 pence).

Based on the Board’s confidence in the Group’s prospects and the greater visibility of rail earnings following the completion of the recent round of rail franchising, we have announced a commitment to increase our dividend by 10% per annum for the next three years. This reflects the Board’s confidence in the Group’s future prospects.