Viridian Group PLC

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Viridian Group PLC

• Interim results for the
• six months ended 30 September 2001

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Philip RogersonChairman

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Financial highlights

• Turnover increased to 305.3m from 253.2m
• Operating profit1 pre goodwill of 48.5m (2000 -
  50.4m)
• EPS2 pre goodwill of 22.6p (2000 - 28.9p)
• Dividends increased 10 from 8.06p to 8.87p per
  share
• 1 Before impact of under-recovery of 4.7m
• 2 Before impact of under-recovery and FRS 19 -
  deferred taxation

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Strategy

• Strategy
• maximise efficiency of core regulated assets
• develop all-Ireland energy business
• maximise potential of businesses outside energy
  sector
• TD regulatory price control review
• Energy markets in Ireland
• Moyle Interconnector
• Huntstown and Energia
• Businesses outside energy sector
• Sx3
• Open Direct
• nevada

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Patrick BourkeGroup Finance Director
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Profit summary
Six months to Sept 01 m
Six months to Sept 00 m
Turnover Operating profit NIE under-recovery Opera
ting profit pre goodwill Goodwill
amortisation Joint venture/associates Profit
before interest and tax Interest Profit before
tax Taxation - current - deferred (FRS
19) Profit after tax
305.3 48.5 (4.7) 43.8 (2.1) (4.4) 37.3 (10.6) 26.7
(3.3) (5.0) 18.4
253.2 50.4 - 50.4 (1.4) (2.3) 46.7 (5.8) 40.9 (4.
8) (5.3) 30.8
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Profitability by business
Six months to Sept 01 m
Six months to Sept 00 m
Transmission and Distribution Power Procurement /
SONI NIE Supply Other regulated activities Total
NIE NIE Powerteam Energia Sx3 Open
Direct Other Adjusted operating profit pre
goodwill NIE under-recovery
34.1 2.4 4.4 0.3 41.2 1.0 0.9 1.0 5.4 (1.0) 48.5 (
4.7) 43.8
32.4 2.1 4.6 0.2 39.3 0.4 (0.8) 4.7 7.2 (0.4) 50.4
- 50.4
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Earnings per share and dividends
Six months to Sept 01 pence
Six months to Sept 00 pence
Adjusted EPS Under-recovery EPS pre goodwill and
deferred tax Deferred tax Goodwill
amortisation Basic EPS Dividend per share
22.6 (2.7) 19.9 (3.8) (2.0) 14.1 8.87
28.9 - 28.9 (4.1) (1.2) 23.6 8.06
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Balance sheet
30 Sept 01 m
31 Mar 01 m restated
Tangible fixed assets Intangible fixed
assets JVs/associates and other
investments Working capital Provisions Deferred
income Net debt Net assets
794.7 86.5 36.1 (3.3) (87.7) (161.7) (368.6) 296.0
906.2 87.5 29.4 (19.1) (93.6) (173.5) (433.2) 303.
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Cashflow statement
Six months to Sept 01 m
Six months to Sept 00 m
Cashflow from operating activities Interest Taxati
on Capital expenditure and financial
investment Acquisitions and disposals Financing Ne
t debt movement Opening net debt Net debt
44.4 (19.6) (4.4) (85.8) - 0.8 (64.6) (368.6) (433
.2)
35.3 (12.8) (3.2) (81.4) (66.8) 0.4 (128.5) (151.2
) (279.7)
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Patrick HarenGroup Chief Executive
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Business structure

• Viridian Power Energy
• Moyle
• Huntstown
• Energia

• Viridian
• Capital
• Sx3
• Open Direct
• nevada

• NIE
• Transmission Distribution
• PPB/SONI
• NIE Supply
• NIE Powerteam

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Transmission and Distribution

• Operating profit of 34.1m (2000 - 32.4m)
• Network capital expenditure of 39.0m (2000 -
  42.5m)
• Investment in customer communications systems
• Focus on quality and cost reduction
• Growth in units distributed of 2.5 number of
  customers increased to 702,000

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TD price control review

• OFREGs initial views due imminently
• Expected to cover a wide range of issues
• RAB
• Capital expenditure
• Operating expenditure
• Cost of capital
• Timetable to be reviewed with OFREG
• Our focus will be on regulatory precedents
  already established in the rest of the UK

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NIE businesses

• PPB / SONI
• Operating profit of 2.4m (2000 - 2.1m)
• Price controls to be extended
• NIE Supply
• Operating profit of 4.4m (2000 - 4.6m)
• Price control in place until March 2005
• NIE Powerteam
• Operating profit of 1.0m (2000 - 0.4m)
• Third party sales representing 21 of total sales

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Opening up energy markets
Moyle
Huntstown

• Moyle Interconnector - 500MW
• North/South interconnectors - upgrade to 600MW
• Huntstown - 343MW CCGT plant

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Independent generation and supply

• Huntstown Power Company
• Construction on schedule
• Shortage of generation capacity in RoI
• Increase in RoI electricity prices
• Energia
• Energia building off-take to match Huntstown
  output
• Strong market share in NI
• 240MW of capacity in RoI through VIPP auction
• Operating profit of 0.9m (2000 - 0.8m loss)

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Sx3

• Revenue increased to 51.5m (2000 - 38.8m)
• Operating profit pre goodwill of 1.0m (2000 -
  4.7m)
• Sx3s existing business achieved increased
  revenue, offset by lower margins and higher costs
• Progress in the smaller acquisitions - XBS, SCP,
  Microcentre
• Loss in First Software

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First Software

• Significant control weaknesses
• Lengthening sales cycle
• Slower conversion of orders to revenues
• Geared up on costs
• Over emphasis on international business

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Sx3

• Changes at Sx3 Board level
• Steps to restrict international business
• Newly centralised sales and marketing function
• Centralised development and implementation
• Emphasis on cost control
• Specific targets for cost reduction

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Sx3

• Strong response to the new iWorld product from
  local authorities
• Strong order book at 30.9.01
• Major managed services contracts Sheffield
  (22m), Hartlepool (24m)
• Firmly focused on task in the second half

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Open Direct
6 months to Sept 2001 m
6 months to Sept 2000 m
Consumer Financial Services - Retail Credit
- Insurance Asset Management - Property - F
leet Solutions Operating profit
4.6 0.8 5.4
2.0 5.2 7.2
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Open DirectConsumer Financial Services

• Continued growth of Retail Credit
• Evesham
• Bennetts
• Insurance businesses in NI rebranded
• Combined consumer retail credit customer base of
  over 230,000 live accounts

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nevada

• Share of operating loss pre goodwill 2.9m (2000
  1.3m)
• Leslie Harris joined as Managing Director
• All-island telecoms and internet company
• RoI internet datacentre opened

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Summary

• Management of TD price control review is a key
  task
• Well positioned for energy opportunities in
  Ireland
• Focus on Sx3 trading performance
• Creation of value for shareholders

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Viridian Group PLC