10 Jan 2005

Interserve Plc provides the following update in advance of announcing preliminary results for 2004 on 9 March 2005.

Trading

Group trading has continued in line with expectations, based on encouraging progress in each of the four principal operating divisions.  Our markets continue to offer positive trading conditions.  During the second half of the year the Group has secured over £800 million worth of new work and our future workload now stands at £4.9 billion (2003: £4.3 billion).  The board looks forward to continued progress in 2005.

Investment disposal

On 30 December 2004 the Group disposed of its equity and loan stock interests associated with the PFI contract for Neath Port Talbot Hospital, in which the Group has no continuing operational involvement.  The sale, representing a multiple of 2.2 times book value, will generate an exceptional profit of £1.9 million.