9 May 2002

At the Annual General Meeting of support services group Interserve Plc held today, Chairman Michael Bottjer said:  "As it is barely two months since I last reported to shareholders in my Chairman's Statement in March, I intend to be relatively brief in my report today.

Subsequent to the preliminary announcement of our results in March we have reached financial close on a PFI project for the Health and Safety Laboratories at Buxton with a whole life value of £130 million, where we will provide £75 million of facilities management services over some 30 years. Shortly we anticipate achieving financial close on a project for Tameside Council with a whole life value of £41 million, where we will design and construct three new schools and provide facilities services over a 30 year period. In addition, we also expect to reach financial close shortly on two prisons. One at Ashford, Middlesex and the other at Peterborough, with whole life values of £213 million and £265 million respectively and where we will design and construct the prisons which have capital values of £41 million and £60 million respectively. On all of the aforementioned projects we will have a significant equity stake.

We now have a portfolio of fifteen secured PFI projects, in eleven of which we have a significant equity stake.

Last week NHS Estates announced our appointment as a principal supply chain partner under the NHS Pro-Cure 21 initiative. The appointment relates to a four year framework agreement under which all publicly funded schemes in excess of £1 million will be delivered in the North West and West Midlands areas of the NHS. We anticipate that the value to us over the period should amount to some £160 million.

It is clear that the Government is committed to improving resources and services in many areas of the public sector including Health, Education, the Prison Service and Defence, areas where PFI projects and outsourcing potentially have an increasingly important part to play. These are growing markets in which we are established as a leading player and where we will continue to apply particular focus.

Overall results in the first three months show a satisfactory advance on the same period last year and whilst there has been delay in the commencement of some contracts, this we regard as purely a timing issue. Opportunities abound in the markets in which we operate and we remain confident in sustaining our record of long term growth.  

Finally I have now been Chief Executive and Chairman for the past six years and, prior to that, Chief Executive for eight years.  It is now our intention to split the roles and to appoint a Chief Executive and that I shall continue as Chairman. I expect to be able to announce details of the appointment of a Chief Executive by the end of this year. In parallel with this we shall be seeking to increase the number of independent non-executive directors."