Brian WallaceBrian WallaceGroup Finance DirectorGroup Finance Director

Brian WallaceBrian WallaceGroup Finance DirectorGroup Finance Director

Hilton Group plc Hilton Group plc - - Summary of Summary of PerformancePerformance

Hilton International

Betting & Gaming

Central costs and income

Operating profit

Goodwill amortisation

Interest

Profit before tax

Tax

Profit after tax

Hilton International

Betting & Gaming

Central costs and income

Operating profit

Goodwill amortisation

Interest

Profit before tax

Tax

Profit after tax

Year to31st December 2000

£m

Year to31st December 2000

£m

Proforma year to31st December 1999*

£m

Proforma year to31st December 1999*

£m

EBITDA before exceptional items 478.4 456.8Profit before tax, goodwill,FRS15 & exceptional items 301.2 305.0

EBITDA before exceptional items 478.4 456.8Profit before tax, goodwill,FRS15 & exceptional items 301.2 305.0

268.0

114.9

(11.6)371.3

(36.9)

(94.6)239.8

(57.2)182.6

268.0

114.9

(11.6)371.3

(36.9)

(94.6)239.8

(57.2)182.6

242.5139.2(21.4)

360.3(28.1)(76.8)255.4 (64.1)191.3

242.5139.2(21.4)

360.3(28.1)(76.8)255.4 (64.1)191.3

* 1999 results have been adjusted to show the effect of FRS15 depreciation as if it had been charged * 1999 results have been adjusted to show the effect of FRS15 depreciation as if it had been charged in 1999.in 1999.

Hilton Group plc - Hilton Group plc - Exceptional ItemsExceptional Items

£m£m

Profit on sale of UK Casinos

Loss on termination of Egyptian Casinos

Loss on sale of non-European betting and gaming businesses

Impairment of Belgium fixed assets

Profit on sale of UK Casinos

Loss on termination of Egyptian Casinos

Loss on sale of non-European betting and gaming businesses

Impairment of Belgium fixed assets

6.9

(10.4)

(14.3)

(25.6)

(43.4)

6.9

(10.4)

(14.3)

(25.6)

(43.4)

£m£m

52.7

(10.4)

(14.3)

(25.6)

2.4

52.7

(10.4)

(14.3)

(25.6)

2.4

P&L effectP&L effect

Net asset effect

Net asset effect

Operating profit as reported 268.0 242.5 10.5%

Net effect of property changes (9.3) (24.3)

Inclusion of overheads treated centrally in 1999 - (10.0)

Effect of treating Stakis as acquired on 1 January 1999 - 19.9

Adjusted operating profit: Full Year258.7 228.1 13.4%

Operating profit as reported 268.0 242.5 10.5%

Net effect of property changes (9.3) (24.3)

Inclusion of overheads treated centrally in 1999 - (10.0)

Effect of treating Stakis as acquired on 1 January 1999 - 19.9

Adjusted operating profit: Full Year258.7 228.1 13.4%

%Increase

%Increase

Year to31st December

2000£m

Year to31st December

2000£m

Proforma year to 31st December

1999£m

Proforma year to 31st December

1999£m

Adjusted operating profit: 1st Half107.6 98.7 9.0%

Adjusted operating profit: 2nd Half151.1 129.4 16.8%

Adjusted operating profit: 1st Half107.6 98.7 9.0%

Adjusted operating profit: 2nd Half151.1 129.4 16.8%

Hilton International - Hilton International - Underlying Underlying PerformancePerformance

UK 606.4 156.3 516.2 148.8 10.5%

Europe 553.7 68.3 485.8 48.311.4%

Middle Eastand Africa 216.6 14.3 192.8 14.0 2.2%

Asia / Australasia518.6 13.6 485.9 11.6 5.9%

Americas 247.3 25.4 193.7 34.1 6.3%

LivingWell 40.9 4.5 27.4 2.9 -

2,183.5 282.4 1,901.8 259.7 7.9%Central & non-operating Items (14.4) (17.2)

268.0 242.5 10.5%

UK 606.4 156.3 516.2 148.8 10.5%

Europe 553.7 68.3 485.8 48.311.4%

Middle Eastand Africa 216.6 14.3 192.8 14.0 2.2%

Asia / Australasia518.6 13.6 485.9 11.6 5.9%

Americas 247.3 25.4 193.7 34.1 6.3%

LivingWell 40.9 4.5 27.4 2.9 -

2,183.5 282.4 1,901.8 259.7 7.9%Central & non-operating Items (14.4) (17.2)

268.0 242.5 10.5%

Turnover Profit Turnover Profit * Revpar£m £m £m £m Growth

Turnover Profit Turnover Profit * Revpar£m £m £m £m Growth

* At constant currencies and including full 12 months of Stakis results.

20002000 1999 Proforma

1999 Proforma

Hilton InternationalHilton International

Hilton UK Revpar vs The London Hilton UK Revpar vs The London MarketMarket

-5%

0%

5%

10%

15%

20%

25%

Jan Feb Mar AprMay Jun Jul AugSep Oct NovDec

MarketMarketHiltonHilton

Source: AA & PKFSource: AA & PKF

2000 Revpar growth2000 Revpar growth

Hilton UK Revpar vs The Provincial Hilton UK Revpar vs The Provincial MarketMarket

-2%0%2%4%6%8%

10%12%14%16%18%

Jan FebMarAprMayJun Jul AugSepOctNovDec

MarketMarketHiltonHilton

Source: AA, PKF & TRISource: AA, PKF & TRI

2000 Revpar growth2000 Revpar growth

Hilton UK Year on Year MovementHilton UK Year on Year Movement

Year on Year Year on Year IncreaseIncrease

Comparable salesComparable sales

Comparable gross Comparable gross profitprofit

Comparable PBITComparable PBIT

11stst Half Half£m£m

9.49.4

5.55.5

(5.2)(5.2)

22ndnd Half Half£m£m

29.829.8

18.218.2

11.611.6

8.0%8.0%

3.0%3.0%

11.2%11.2%

22.8%22.8%

17.7%17.7%

11.9%11.9%

39.3%39.3%35.1%35.1%

Top Ten UK and International Hotel Top Ten UK and International Hotel GrowthsGrowths

First HalfFirst Half Second HalfSecond Half

0.00.0

5.05.0

10.010.0

15.015.0

20.020.0

25.025.0

Revpar Revpar GwthGwth

PBIT GwthPBIT Gwth

% Growth% Growth

Top 10 UK HotelsTop 10 UK Hotels Top 10 International Top 10 International HotelsHotels

Revpar Revpar GwthGwth

PBIT GwthPBIT Gwth

% Growth% Growth

0.00.05.05.0

10.010.015.015.020.020.025.025.030.030.035.035.040.040.045.045.0

31.031.0

47.047.0

37.537.5

47.47.88

39.239.2

33.33.55

37.37.99

46.46.9946.346.3

32.32.11

30.330.3

34.34.55

Comparable Like for Like Gross Comparable Like for Like Gross Operating Profit by AreaOperating Profit by Area

25.0%25.0%

30.0%30.0%

35.0%35.0%

40.0%40.0%

45.0%45.0%

50.0%50.0%

AmericaAmericass

Asia/ Asia/ AustralasiAustralasi

aa

MiddleMiddleEast East

& Africa& Africa

ContinentaContinentall

EuropeEuropeUKUK TotalTotal

20002000 19991999

Betting & Gaming Profit ComparisonBetting & Gaming Profit Comparison

1999 reported profit

High roller activity

Sale of Golden Gate Fields

Stakis Q1

2000 reported profit

Movement

1999 reported profit

High roller activity

Sale of Golden Gate Fields

Stakis Q1

2000 reported profit

Movement

RetailBettingRetail

Betting

TelephoneBetting /eGaming

TelephoneBetting /eGamingAmericasAmericasCasinosCasinosVernonsVernons TotalTotal

£m£m £m£m £m£m £m£m £m£m £m£m

12.5

2.6

15.1

14.1

(1.0)

12.5

2.6

15.1

14.1

(1.0)

6.1

6.1

5.6

(0.5)

6.1

6.1

5.6

(0.5)

10.4

(2.9)

7.5

8.5

1.0

10.4

(2.9)

7.5

8.5

1.0

91.0

91.0

94.6

3.6

91.0

91.0

94.6

3.6

19.2

(12.2)

7.0

(7.9)

(14.9)

19.2

(12.2)

7.0

(7.9)

(14.9)

139.2

(12.2)

(2.9)

2.6

126.7

114.9

(11.8)

139.2

(12.2)

(2.9)

2.6

126.7

114.9

(11.8)

Turnover 1,642.9 1,667.2 (24.3)

Gross profit

(including AWP’s) 310.5 300.1 10.4

Gross profit %

- including AWP’s 18.9% 18.0% 0.9%

- excluding AWP’s 17.3% 16.4% 0.9%

Operating costs (226.1) (215.8) (10.3)

Operating profit 84.4 84.3 0.1

Turnover 1,642.9 1,667.2 (24.3)

Gross profit

(including AWP’s) 310.5 300.1 10.4

Gross profit %

- including AWP’s 18.9% 18.0% 0.9%

- excluding AWP’s 17.3% 16.4% 0.9%

Operating costs (226.1) (215.8) (10.3)

Operating profit 84.4 84.3 0.1

2000£m

2000£m

1999£m

1999£m

Variance£m

Variance£m

UK Retail Betting - UK Retail Betting - Comparative Comparative AnalysisAnalysis

Horses 15.2 16.1 15.6 15.1

Greyhounds 20.5 19.2 19.8 19.3

Numbers 29.0 29.4 29.2 28.5

Other Sports 12.6 10.2 11.3 11.6

Football 21.3 24.8 23.0 18.1

Total 16.9 17.6 17.3 16.4

Horses 15.2 16.1 15.6 15.1

Greyhounds 20.5 19.2 19.8 19.3

Numbers 29.0 29.4 29.2 28.5

Other Sports 12.6 10.2 11.3 11.6

Football 21.3 24.8 23.0 18.1

Total 16.9 17.6 17.3 16.4

First HalfFirst Half

Gross Betting Margin Before Gross Betting Margin Before Costs (%)Costs (%)

Second HalfSecond HalfFull YearFull Year20002000

20002000 19991999

Analysis of Telephone Betting/eGaming Analysis of Telephone Betting/eGaming profitprofit

UK

- Telephone Betting 2.1 3.3 (1.2)

- eGaming (8.0) - (8.0)

International

- Elite Telebetting 1.2 4.9 (3.7)

- Other Telebetting (1.9) (1.2) (0.7)

- High Roller activity 0.7 12.2 (11.5)

- Internet Betting (2.0) - (2.0)

(7.9) 19.2 (27.1)

UK

- Telephone Betting 2.1 3.3 (1.2)

- eGaming (8.0) - (8.0)

International

- Elite Telebetting 1.2 4.9 (3.7)

- Other Telebetting (1.9) (1.2) (0.7)

- High Roller activity 0.7 12.2 (11.5)

- Internet Betting (2.0) - (2.0)

(7.9) 19.2 (27.1)

2000£m

2000£m

1999£m

1999£m

Variance

£m

Variance

£m

UK Telebetting

UK Telebetting

GibraltarCall CentreGibraltar

Call CentreGibraltar

EliteGibraltar

EliteTotalTotal

2000

£m

2000

£m

1999

£m

1999

£m

2000

£m

2000

£m

1999

£m

1999

£m

2000

£m

2000

£m

1999

£m

1999

£m

2000

£m

2000

£m

1999

£m

1999

£mTurnover

Gross profit

Costs

Net profit

Turnover

Gross profit

Costs

Net profit

95.2

8.6

(6.5)

2.1

95.2

8.6

(6.5)

2.1

 129.8

9.9

(6.6)

3.3

 129.8

9.9

(6.6)

3.3

 75.0 

4.3 

(6.2) 

(1.9) 

 75.0 

4.3 

(6.2) 

(1.9) 

 4.1

0.4

(1.6)

(1.2)

 4.1

0.4

(1.6)

(1.2)

 72.6 

2.8 

(1.6) 

1.2 

 72.6 

2.8 

(1.6) 

1.2 

 85.4 

5.9 

(1.0) 

4.9 

 85.4 

5.9 

(1.0) 

4.9 

 242.8 

15.7 

(14.3) 

1.4 

 242.8 

15.7 

(14.3) 

1.4 

 219.3 

16.2 

(9.2) 

7.0 

 219.3 

16.2 

(9.2) 

7.0 

Note: Excludes high roller activity in GibraltarNote: Excludes high roller activity in Gibraltar

Telebetting AnalysisTelebetting Analysis

UK Telebetting

UK Telebetting

GibraltarCall CentreGibraltar

Call CentreGibraltar

EliteGibraltar

EliteTotalTotal

2000

£m

2000

£m

1999

£m

1999

£m

2000

£m

2000

£m

1999

£m

1999

£m

2000

£m

2000

£m

1999

£m

1999

£m

2000

£m

2000

£m

1999

£m

1999

£mTurnover

Gross profit

Costs

Net profit

No. of calls

Cost per call

Turnover

Gross profit

Costs

Net profit

No. of calls

Cost per call

95.2

8.6

(6.5)

2.1

2.5m

£2.60

95.2

8.6

(6.5)

2.1

2.5m

£2.60

 129.8

9.9

(6.6)

3.3

2.6m

£2.50

 129.8

9.9

(6.6)

3.3

2.6m

£2.50

 75.0 

4.3 

(6.2) 

(1.9) 

1.2m 

£5.10 

 75.0 

4.3 

(6.2) 

(1.9) 

1.2m 

£5.10 

 4.1

0.4

(1.6)

(1.2)

39k

£41.00

 4.1

0.4

(1.6)

(1.2)

39k

£41.00

 72.6 

2.8 

(1.6) 

1.2 

67k 

£23.90

 72.6 

2.8 

(1.6) 

1.2 

67k 

£23.90

 85.4 

5.9 

(1.0) 

4.9 

60k 

£16.80

 85.4 

5.9 

(1.0) 

4.9 

60k 

£16.80

 242.8 

15.7 

(14.3) 

1.4 

3.8m 

£3.80 

 242.8 

15.7 

(14.3) 

1.4 

3.8m 

£3.80 

 219.3 

16.2 

(9.2) 

7.0 

2.7m 

£3.40 

 219.3 

16.2 

(9.2) 

7.0 

2.7m 

£3.40 

Note: Excludes high roller activity in GibraltarNote: Excludes high roller activity in Gibraltar

Telebetting AnalysisTelebetting Analysis

UK Telebetting

UK Telebetting

GibraltarCall CentreGibraltar

Call CentreGibraltar

EliteGibraltar

EliteTotalTotal

2000

£m

2000

£m

1999

£m

1999

£m

2000

£m

2000

£m

1999

£m

1999

£m

2000

£m

2000

£m

1999

£m

1999

£m

2000

£m

2000

£m

1999

£m

1999

£mTurnover

Gross profit

Costs

Net profit

No. of calls

Cost per call

Full yeargross profit %

Half year gross profit %

Turnover

Gross profit

Costs

Net profit

No. of calls

Cost per call

Full yeargross profit %

Half year gross profit %

95.2

8.6

(6.5)

2.1

2.5m

£2.60

9.0%

7.9%

95.2

8.6

(6.5)

2.1

2.5m

£2.60

9.0%

7.9%

 129.8

9.9

(6.6)

3.3

2.6m

£2.50

7.6%

6.9%

 129.8

9.9

(6.6)

3.3

2.6m

£2.50

7.6%

6.9%

 75.0 

4.3 

(6.2) 

(1.9) 

1.2m 

£5.10 

5.7%

3.4%

 75.0 

4.3 

(6.2) 

(1.9) 

1.2m 

£5.10 

5.7%

3.4%

 4.1

0.4

(1.6)

(1.2)

39k

£41.00

9.8%

-

 4.1

0.4

(1.6)

(1.2)

39k

£41.00

9.8%

-

 72.6 

2.8 

(1.6) 

1.2 

67k 

£23.90

3.9%

3.6%

 72.6 

2.8 

(1.6) 

1.2 

67k 

£23.90

3.9%

3.6%

 85.4 

5.9 

(1.0) 

4.9 

60k 

£16.80

6.9%

6.8%

 85.4 

5.9 

(1.0) 

4.9 

60k 

£16.80

6.9%

6.8%

 242.8 

15.7 

(14.3) 

1.4 

3.8m 

£3.80 

6.5%

5.4%

 242.8 

15.7 

(14.3) 

1.4 

3.8m 

£3.80 

6.5%

5.4%

 219.3 

16.2 

(9.2) 

7.0 

2.7m 

£3.40 

7.4%

6.9%

 219.3 

16.2 

(9.2) 

7.0 

2.7m 

£3.40 

7.4%

6.9%Note: Excludes high roller activity in GibraltarNote: Excludes high roller activity in Gibraltar

Telebetting AnalysisTelebetting Analysis

Cumulative Internet Cumulative Internet RegistrationsRegistrations

00

20,00020,000

40,00040,000

60,00060,000

80,00080,000

100,000100,000

120,000120,000

FebFeb MarMar AprilAprilMayMay JuneJune JulyJuly AugAug SeptSept OctOct NovNov DecDec JanJan

Sportsbook Margin Progression Sportsbook Margin Progression

-5%-5%

0%0%

5%5%

10%10%

15%15%

20%20%

JulyJuly AugAug SeptSept OctOct NovNov DecDec JanJan

Inflow from operating activities 462.0 363.2

Interest paid (103.9) (60.2)

Tax paid (48.9) (58.5)

Dividends paid (123.5) (177.0)

Free cash flow 185.7 67.5

Capital expenditure (476.9) (358.6)

Proceeds from asset sales 22.0 244.5

Acquisitions, disposals 244.4 (366.7)

(24.8) (413.3)

Exchange & other movements (12.7) 26.0

Opening net debt (1,336.8) (949.5)

Closing net debt (1,374.3) (1,336.8)

Inflow from operating activities 462.0 363.2

Interest paid (103.9) (60.2)

Tax paid (48.9) (58.5)

Dividends paid (123.5) (177.0)

Free cash flow 185.7 67.5

Capital expenditure (476.9) (358.6)

Proceeds from asset sales 22.0 244.5

Acquisitions, disposals 244.4 (366.7)

(24.8) (413.3)

Exchange & other movements (12.7) 26.0

Opening net debt (1,336.8) (949.5)

Closing net debt (1,374.3) (1,336.8)

2000 £m

2000 £m

1999 £m

1999 £m

Group Cash FlowGroup Cash Flow

HiltonHilton

Analysis of Capital ExpenditureAnalysis of Capital Expenditure

£m£m £m£m  Acquisitions

Sydney 70.8 Caledonian 45.8Dusseldorf 30.0

146.6Other Capital

United Kingdom 147.3Overseas 99.8LivingWell 30.8

277.9Betting & Gaming

Refurbishment/relocation 19.5 BS2000 EPOS system 8.5 Other 24.4

52.4

476.9

  Acquisitions Sydney 70.8 Caledonian 45.8Dusseldorf 30.0

146.6Other Capital

United Kingdom 147.3Overseas 99.8LivingWell 30.8

277.9Betting & Gaming

Refurbishment/relocation 19.5 BS2000 EPOS system 8.5 Other 24.4

52.4

476.9

David MichelsDavid MichelsGroup Chief ExecutiveGroup Chief Executive

David MichelsDavid MichelsGroup Chief ExecutiveGroup Chief Executive

Hilton InternationalHilton International

Worldwide revpar increase 1999 vs 2000Worldwide revpar increase 1999 vs 2000 7.9% 7.9% (constant currencies and comparable Stakis) (constant currencies and comparable Stakis)

UK revpar increaseUK revpar increase 10.5%10.5%

Like for like UK:Like for like UK:1st half1st half 2nd half2nd half

GOP conversionGOP conversion 46.5%46.5% 49.0%49.0%

PBITPBIT (7.0%)(7.0%) 14.3%14.3%20002000 19991999 20002000 19991999£m£m £m£m £m £m £m£m68.668.6 73.873.8 92.7 92.7 81.181.1

ObjectivesObjectives

More falls to the bottom line

These businesses are as customer friendly as we can make them

That our physical hotel estate lives up to Hilton’s perceived reputation

That our eGaming investment is sensibly directed

That we expand the group

To improve the long term return on capital of the group as a whole

More falls to the bottom line

These businesses are as customer friendly as we can make them

That our physical hotel estate lives up to Hilton’s perceived reputation

That our eGaming investment is sensibly directed

That we expand the group

To improve the long term return on capital of the group as a whole

As at Interim Results 2000As at Interim Results 2000

Openings and PipelineOpenings and Pipeline

HotelsHotels No. of roomsNo. of rooms

Openings 2000Openings 2000 1212 3,7133,713Medina, Malta, Caledonian, Buenos Aires, Algiers, Budapest WestEnd, Medina, Malta, Caledonian, Buenos Aires, Algiers, Budapest WestEnd, Dalian, Dubai Jumeirah, Hua Hin, Mauritius, Seremban, TobagoDalian, Dubai Jumeirah, Hua Hin, Mauritius, Seremban, Tobago

PipelinePipeline 4141 11,237 11,237Opening 2001Opening 2001 2020 5,1625,162

Incl:Incl: Copenhagen, Sofia, Rhodes, Melbourne Airport, Dubai, Jeddah, Copenhagen, Sofia, Rhodes, Melbourne Airport, Dubai, Jeddah, Trafalgar Square, Paddington, Auckland, Moscow, Bangalore, AmmanTrafalgar Square, Paddington, Auckland, Moscow, Bangalore, Amman

Opening 2002/2003Opening 2002/2003 21 21 6,0756,075Incl: Dubrovnik, Philippines, Beirut, Xiamen, Sao Paulo, Lagos, Kuala Incl: Dubrovnik, Philippines, Beirut, Xiamen, Sao Paulo, Lagos, Kuala Lumpur, Tahiti, Inchon Lumpur, Tahiti, Inchon

Customer SatisfactionCustomer Satisfaction

Independent research Independent research carried out for Hilton carried out for Hilton International, based International, based on a sample of over on a sample of over 8,100 respondents8,100 respondents

1999199968%68%

20%20%

12%12%

20002000

Completely or Very Completely or Very SatisfiedSatisfiedFairly SatisfiedFairly Satisfied

DissatisfiedDissatisfied

71%71%

20%20%

9%9%

Maintenance/mandatoryMaintenance/mandatory 48.6 48.6 43.043.0Profit generatingProfit generating 205.4205.4 132.2132.2

254.0254.0 175.2175.2

New builds/developmentNew builds/development 23.923.9 67.367.3AcquisitionsAcquisitions 146.6146.6 7.27.2

Total Total 424.5424.5 249.7249.7

Hilton InternationalHilton International

Capital ExpenditureCapital Expenditure

20002000 20012001ActualActual ForecastForecast

£m£m £m£m

Major ProjectsMajor Projects

AmsterdamAmsterdam - major refurbishment- major refurbishment 16.516.5 49.0%49.0%MetropoleMetropole - extension- extension 90.990.9 22.3%22.3%Munich ParkMunich Park - major refurbishment- major refurbishment 39.939.9 15.0%15.0%CaribeCaribe - purchase & refurbishment- purchase & refurbishment 85.485.4 12.9%12.9%

CapitalCapitalExpenditure Expenditure

£m£m

IRRIRRForecastForecast

Amsterdam Hilton - Profit HistoryAmsterdam Hilton - Profit History

Note: 2000 numbers are on a Pre FRS 15 basisNote: 2000 numbers are on a Pre FRS 15 basis

00

11

22

33

44

19971997 19981998 19991999 20002000

Total cost £16.5m substantially completed Q2 1999Total cost £16.5m substantially completed Q2 1999

Amsterdam Hilton RefurbishmentAmsterdam Hilton Refurbishment

Hilton AllianceHilton Alliance

Hilton HHonorsHilton HHonorsTotal membersTotal members 10.5m10.5m 7.7m7.7mActive membersActive members 5.3m5.3m 2.8m2.8m

Hilton Reservations WorldwideHilton Reservations WorldwideTotal worldwideTotal worldwide 9.2m9.2m 7.8m7.8mhilton.com worldwide 376khilton.com worldwide 376k 149k149kHRW Hilton InternationalHRW Hilton International 1.6m1.6m 1.2m1.2m

Conrad Joint VentureConrad Joint VentureFamily of brands - Hilton Garden Inn, Doubletree, Family of brands - Hilton Garden Inn, Doubletree, Embassy, Hampton, Homewood, Red LionEmbassy, Hampton, Homewood, Red Lion

20002000 19991999

Current Total MembershipCurrent Total Membership 125,000125,000UK UK 112,500112,500InternationalInternational 12,50012,500

UK Development 2000/2001UK Development 2000/2001Clubs opened in UK in 2000Clubs opened in UK in 2000Clubs to Open in UK in Clubs to Open in UK in 20012001

HotelHotel PremierPremier

NottinghamNottingham PeterboroughPeterborough(open) (open) CaledonianCaledonian Burton on Trent Burton on Trent (open) (open)

InvernessInvernessPremierPremier BarnsleyBarnsleySutton Coldfield Sutton Coldfield YorkYorkCarlisle Carlisle AshfordAshford

LivingWellLivingWell

Health Club Malta (open)

Melbourne

Airport

Mersin Adana Dresden Berlin Mainz

Health Club Malta (open)

Melbourne

Airport

Mersin Adana Dresden Berlin Mainz

Premier Health Club

North Sydney (open)

Castlehill, Sydney (open)

Brisbane (open)

Carindale, Brisbane

Sydney Hilton

Premier Health Club

North Sydney (open)

Castlehill, Sydney (open)

Brisbane (open)

Carindale, Brisbane

Sydney Hilton

LivingWellLivingWell

Bucharest

Prague Dresden Bangkok Colombo Adelaide

Bucharest

Prague Dresden Bangkok Colombo Adelaide

International Development 2000 / 2001International Development 2000 / 2001International Development 2000 / 2001International Development 2000 / 2001

Hilton InternationalHilton International

PropertyProperty

UKUK -- £1.9 billion£1.9 billion

OverseasOverseas -- £0.9 billion£0.9 billion

£300 million to be sold in UK whilst £300 million to be sold in UK whilst retaining flagretaining flag

UK Ladbroke CasinosUK Ladbroke Casinos -- non corenon coreSold for £236.7 million vs 2000 PBIT £14.9 Sold for £236.7 million vs 2000 PBIT £14.9 millionmillion

Overseas GamingOverseas Gaming -- non corenon coreSold - Fort Erie; Argentina; Peru; San Pablo Sold - Fort Erie; Argentina; Peru; San Pablo Card Club;Card Club;PennsylvaniaPennsylvania (conditional contract);(conditional contract); ColoradoColorado (auction process at advanced stage)(auction process at advanced stage)

To be sold - 2 Cairo casinosTo be sold - 2 Cairo casinos

Sale of BusinessesSale of Businesses

UK Betting Industry & UK Betting Industry & EnvironmentEnvironment

Government review of a new betting tax regime

Gambling Review Body to submit report to Home Office during summer

Horserace levy agreed for 2001/02. Home Office consulting on a replacement scheme

SIS in discussions with the Racecourse Association (RCA) over renewal of betting shop picture rights

Government review of a new betting tax regime

Gambling Review Body to submit report to Home Office during summer

Horserace levy agreed for 2001/02. Home Office consulting on a replacement scheme

SIS in discussions with the Racecourse Association (RCA) over renewal of betting shop picture rights

EBITDA break even achieved

Further investment planned

By end 2001 sustainable break even will be achieved

Move into profit during 2002

Sportsbook registrations 105,000

Casino players 6,000

Average cost customer recruitment 2000 £42.00 2001 £29.00

EBITDA break even achieved

Further investment planned

By end 2001 sustainable break even will be achieved

Move into profit during 2002

Sportsbook registrations 105,000

Casino players 6,000

Average cost customer recruitment 2000 £42.00 2001 £29.00

eGaming PerformanceeGaming Performance

PlatformPlatform MediaMedia TimingTimingInternetInternet Bet.co.ukBet.co.uk Launched February 2000Launched February 2000

Ladbrokes.co.ukLadbrokes.co.uk Launched February 2000Launched February 2000Ladbrokes.comLadbrokes.com Launched February 2000Launched February 2000Ladbrokescasino.comLadbrokescasino.com Launched November 2000Launched November 2000Vernons.co.ukVernons.co.uk Launched February 2001Launched February 2001

MobileMobile WAPWAP Launched August 2000Launched August 2000GPRSGPRS Summer 2001Summer 2001UMTSUMTS 20032003

Digital TV Digital TV CableCable }} TelewestTelewest Launched February 2000Launched February 2000}} CWCCWC Launched March 2000Launched March 2000}} NtlNtl Launch April/May 2001Launch April/May 2001

SatelliteSatellite}} OpenOpen In DiscussionIn Discussion}} Sky (WAPTV)Sky (WAPTV) Awaiting platform ratesAwaiting platform rates

TerrestrialTerrestrial}} On DigitalOn Digital LaunchedLaunched

eGaming PlatformseGaming Platforms

Partner ActivityTeamtalk Exclusive sportsbook and casino link

South ChinaMorning Post Sportsbook and casino link

Soccernet World’s largest soccer site – exclusive sportsbook link

Cricinfo World’s largest single sports site Sportsbook and casino link

Autosport.com Europe’s second biggest motor racing site

Sportsbook link

Totalsports.asia.com Dedicated sales team in KL generating affiliate deals for Ladbrokes sportsbook

and casino in Far East

Playboy Provide sportsbook. One of the top ten most searched words on the worldwide

web

Partner ActivityTeamtalk Exclusive sportsbook and casino link

South ChinaMorning Post Sportsbook and casino link

Soccernet World’s largest soccer site – exclusive sportsbook link

Cricinfo World’s largest single sports site Sportsbook and casino link

Autosport.com Europe’s second biggest motor racing site

Sportsbook link

Totalsports.asia.com Dedicated sales team in KL generating affiliate deals for Ladbrokes sportsbook

and casino in Far East

Playboy Provide sportsbook. One of the top ten most searched words on the worldwide

web

eGaming PartnershipseGaming Partnerships

eGaming Future DevelopmentseGaming Future Developments

Activity Planned 2001 Flash casino games March Cantonese Casino April Ntl interactive TV service April Playboy sportsbook April Progressive casino games (blackjack/roulette/slots) May High roller casino September Numbers games July Sportsbook – next generation July Poker Million web site September Video streamed casino December

Activity Planned 2001 Flash casino games March Cantonese Casino April Ntl interactive TV service April Playboy sportsbook April Progressive casino games (blackjack/roulette/slots) May High roller casino September Numbers games July Sportsbook – next generation July Poker Million web site September Video streamed casino December

NB:* 1 million digital terrestrial homes via OnDigital but only circa 50,000 currently subscribe to OnNet boxes which enable Web access (i.e. delivers a return path)

NB:* 1 million digital terrestrial homes via OnDigital but only circa 50,000 currently subscribe to OnNet boxes which enable Web access (i.e. delivers a return path)

eGaming - Digital TVeGaming - Digital TV

2000 2000 2004 (F’cast)2004 (F’cast)

Homes Connected

Satellite Sky/Open 4.7m 7.2m

Cable Ntl 0.5m 2.8m

Telewest 0.3m 1.5m

Terrestrial On-Digital 1.0m 3.3m

6.5m 14.8m

2000 2000 2004 (F’cast)2004 (F’cast)

Homes Connected

Satellite Sky/Open 4.7m 7.2m

Cable Ntl 0.5m 2.8m

Telewest 0.3m 1.5m

Terrestrial On-Digital 1.0m 3.3m

6.5m 14.8m