the UKs leading independent express delivery company

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Business Post Group plc
the UKs leading independent express delivery
company
Interim Results Presentation
16 November 2004
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Presenters
Paul Carvell - Chief Executive Peter Fitzwilliam
- Finance Director Russell Hodgson - Group
Managing Director, Parcel Services
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Programme
Introduction Paul Carvell Financial
Review Peter Fitzwilliam Business Review -
Parcel Services Russell Hodgson - Other
Services Paul Carvell Conclusion Paul Carvell
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Background

• Year to 31 March 2005 is the third year of the
  first Three Year Plan
• 2003 the year of investment modest profit
  growth
• 2004 and 2005 envisaged more rapid profit growth

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Industry Comparisons

• Highest turnover growth
• Highest margins
• Second highest turnover per employee
• Second highest profit per employee

Business Post is the leading independent express
delivery company
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Interim Results Highlights

• Profits up by 12 to 9.1m, despite likely
  increased H2 bias
• Good progress by Express in competitive market
• Continuing fast growth of HomeServe, Courier,
  International and UK Pallets
• Successful launch of UK Mail
• Board remains very confident of the Groups long
  term potential
• before goodwill amortisation and tax

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Summarised Profit and Loss Account
6 months to 30 September 2004 2003 Increase
Turnover (m) 109.9 89.4
23 Operating profit (m) 9.2 8.0
15 Pre-tax profit (m) 9.1 8.1
12 Earnings per share (p) 11.8 10.7
10 Dividend per share (p) 6.4 5.95
8 pre-goodwill amortisation of 0.3m (2003
0.1m)
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Business Unit Turnover
By Proportion
By Value
2003
2004
Increase
2003 m
2004 m
6 months to 30 September
69
59
6
61.5
65.2
Express
13
12
19
11.4
13.6
International
8
10
57
6.9
10.8
HomeServe
6
6
24
5.0
6.2
Courier
4
10
18
3.6
11.0
UK Pallets
-
2
-
-
2.1
UK Mail
1
1
-
1.0
1.0
Other
100
100
23
89.4
109.9
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Restated for Eire business Acquired in July
2003 increase is on like-for-like basis
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Revenues per Working Day
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Operating Profit Margins

• Reported total 8.1 vs 8.8
• UK Mail H1 loss
• UK Pallets below Group average
• Like-for-like improving
• UK Today improvements
• Operational gearing

Like-for-like margins improving
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Summarised Cash Flow Statement
6 months to 30 September 2004 2003 m m Operat
ing profit 8.9 7.9 Depreciation and
amortisation 2.4 1.8 Working capital (3.0) (3.7)
Operating activities 8.3 6.0 Tax (2.5) (2.2) In
terest (0.1) 0.1 Capital expenditure (4.5) (3.8)
Dividends (6.4) (6.0) Net cash flow before
acqns and financing (5.2) (5.9) Acquisitions -
(9.7) Financing term loan/share
capital (0.3) 10.1Net cash flow (5.5) (5.5)
Good increase in net cash from operating
activities
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Summarised Balance Sheet
At 30 September 2004 2003 m m Fixed
assets 44.2 43.7 Current assets 50.8 40.9 Credit
ors lt1 year (32.8) (26.0) Long-term
liabilities (9.7) (10.3) Net assets 52.5 48.3 Ne
t debt (10.1) (13.9) Annualised post-tax
ROANA 25 24
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Strong balance sheet further increase in ROANA
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Parcel Services
Express (B2B)
HomeServe (B2C)
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International
Network Services
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Express - UK business-to-business parcels

• Still core 59 of Group turnover
• Wide cross-section of customers focus on those
  seeking top-of-the-range service
• 6 growth to 65.2m
• good in competitive market conditions
• 7½ share of c1.6 billion market

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International - International parcels and mail

• Turnover up 19 to 13.6m
• International Mail continuing to grow rapidly
• New contribution from FedEx International
  Priority Freight
• Eurodis progressing well, inc Nightline

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HomeServe - UK business-to-consumer parcels

• Still growing rapidly Turnover 57 higher at
  10.8m
• Careful selection of customers the key to success
• Walsh Western growing new contract with Dixons
  Stores Group
• and PC World
• Expanding evening deliveries and SMS

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eBox
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Network Services - shared infrastructure

• High quality delivery service at low unit cost
• Continued investment in franchise network
• Creation of Parcel Services is starting to bear
  fruit
• Focus on increasing satisfaction amongst
  customers, employees and associates the
  Delta Programme

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Courier - UK (same day) couriers

• Turnover increased by 24 to 6.2m
• UK Today substantially increased turnover and
  profit margin
• BXTech renewed major contracts enlarged sales
  effort

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UK Pallets UK palletised goods delivery

• Nationwide network of over 70 partners
• Turnover of 11.0m, up 18 against full six
  months of prior year
• Operation being geared up for substantial
  expansion
• Consideration renegotiated at 9.0m
• Board remains confident of future prospects

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giving you the choice
UK Mail - UK business mail

• Nationwide two day business class service
• Turnover of 2.1m from 10 May start
• Customers in utilities, telecoms, government and
  retail
• Annualised turnover currently over 12m
• Remains on budget for modest FY loss
• Overall, a highly satisfactory start

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giving you the choice
The 5.8bn UK mail market
UK MailDeutsche PostTNT
DX Services
Other
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Current Trading and Short Term Prospects

• Trading since half year end encouraging
• The Board expects further good progress
• in the current year

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Strategy for Continued Profitable Growth

• Group already contains elements necessary for
  further substantial profitable growth
• Double-digit growth possible even without UK Mail
• Concentrate principally on organic growth,
  supplemented by bolt-on acquisitions
• Focus on cross-selling further differentiation

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Long Term Prospects
The Board remains very confident about the
Groups long term potential
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