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Investor Workshop 17 September 2004

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THE STRATEGIC CHALLENGE Trading Environment changing rapidly Performance of Holidaybreak and business portfolio Outlook for 2005 Longer term prospects and strategy

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HOLIDAYBREAK DEFINED HOLIDAYBREAK Travel sector Balanced portfolio of specialist holiday businesses Primarily UK market based but European aspirations Decentralised structure

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TRADING ENVIRONMENT Demographics Socio-Economic trends Travel Industry structural upheaval Travel Consumer trends

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DEMOGRAPHICS Smaller Family Units More Middle Aged and Older People Fewer Younger Families More Divorces/ Children from Different Marriages DEMOGRAPHICS More One Parent Households

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SOCIAL & ECONOMIC CHANGES Increasing disposable income/spend on leisure Increasing grey consumer power Changing patterns of work - Work more intensive but more short span leisure opportunities - More women in employment Increase in pace/pressure of modern living KEY SOCIO-ECONOMIC TRENDS

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EXPENDITURE ON TRAVEL Source: Mintel (2003)

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SOCIAL & ECONOMIC CHANGES Increasing disposable income/spend on leisure Increasing grey consumer power Changing patterns of work - Work more intensive but more short span leisure opportunities - More women in employment Increase in pace/pressure of modern living KEY SOCIO-ECONOMIC TRENDS

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TIME PRESSURE Source: The Henley Centre: Planning for Consumer Change, 1991 - 2000

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TRAVEL INDUSTRY STRUCTURAL CHANGES High Street Travel Agents No Frills Airlines Decline of Global Vertically Integrated Operators Distribution Fragmenting Packages Unbundling Above the line more fragmented and less cost effective More ChannelsInternet Sector less Profitable TRAVEL INDUSTRY CHANGE

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OPERATOR MARKET SHARE Source: CAA

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TRAVEL INDUSTRY CONSUMER CHANGE Later Bookings/ Shorter Lead Times More Frequent, Shorter Holidays More Independent and Tailor Made Travel TRAVEL CONSUMER TRENDS Competing for share of time as well as share of wallet

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MULTIPLE HOLIDAY TAKING Holidaymakers are taking fewer two-week summer breaks than ever, according to one of the countrys largest travel agencies. The Co-operative Travel Trading Group has found that bookings for fortnight-long holidays are 10 per cent down this summer, with people taking week-long breaks so they can afford two or three weekend escapes at other times of the year. TIMES : 20/8/04

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TRAVEL INDUSTRY CONSUMER CHANGE Later Bookings/ Shorter Lead Times More Frequent, Shorter Holidays More Independent and Tailor Made Travel TRAVEL CONSUMER TRENDS Competing for share of time as well as share of wallet

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INCLUSIVE VS INDEPENDENT Source: Mintel (2003)

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TRAVEL SECTOR GROWTH MARKETS DOMESTIC HOLIDAYS - Up 21% (1991-2003) - 64% short breaks and share growing - 2002/3 strong years post FMD, 9/11, Iraq war etc OVERSEAS - Up 103% (1991-2003) - 15% short breaks and share growing - Still grew (at lower rates) in 2002/3 GROWTH AREAS - Grey market - Activity/special interest - Cruise - Overseas property ownership - VFR TRAVEL MARKET

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GROWTH IN OVERSEAS HOLIDAY TRIPS Source: Mintel (2003)

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GROWTH IN DOMESTIC HOLIDAY TRIPS Source: UKTS (2004)

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ACTIVITY HOLIDAYS ABROAD Source: Mintel (2003) m

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HOLIDAYBREAK PLC PERFORMANCE AND BUSINESS PORTFOLIO Consistent earnings growth and cash generation Rapid growth of Hotel Breaks means business portfolio more balanced Three high quality businesses well placed to benefit from changing travel sector environment Very different products and business models Important common qualities and shared characteristics

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THREE BUSINESS TYPES HOTEL BREAKS Accommodation Ancillaries Agents Customer SUPERBREAK - Efficient cost distribution at reasonable yields for suppliers - High service levels, convenience and value for customers and agents VALUE ADDED DISTRIBUTION

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CLASSIC TOUR OPERATING MODEL THREE BUSINESS MODELS ADVENTURE Accommodation Tour Content Customers EXPLORE - Tour origination and operation - High value added - Very difficult for DIY customer to replicate Transport

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HYBRID MODEL PART TOUR OPERATOR, PART PRINCIPAL THREE BUSINESS TYPES CAMPING Transport Operators Customers Camp-sites Equipment Suppliers EUROCAMP/KEYCAMP - On site service - Accommodation - Access to best sites - Strongly branded - Effective distribution

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HOLIDAYBREAK BUSINESSES COMMON QUALITIES & SHARED CHARACTERISTICS Strong management teams focus and commitment Market leading brands Service and product quality Healthy margins Cash generation Resilience

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EPS* GROWTH Pence * Before goodwill amortisation, impairment and exceptional operating costs +9.3% +16.0% +12.0% +11.6% +4.5%

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OPERATING CASH GENERATION Operating cash generation after capex but before interest, dividends, tax and acquisitions

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OUTLOOK FOR 2005 Macro-economy Reversal of trend to UK holidays (weather!) Hotel Breaks and Adventure have strong momentum and are well placed to benefit from travel sector trends Camping has purpose, direction and leadership - sector developments give opportunities Positive start to 2005 booking campaigns

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STRATEGIC DIRECTION Holidaybreak = portfolio of specialist travel businesses not otherwise available to investors in quoted businesses Maximising potential and value of existing businesses an imperative Further acquisitions a possibility Must continue to add value for customers, suppliers and shareholders Targetting further growth and continued cash generation