THE UK s LEADING OPERATOR OF SPECIALIST HOLIDAY BUSINESSES

THE UK’s LEADING OPERATOR OF SPECIALIST HOLIDAY BUSINESSES 1 st January 2004 1

Holidaybreak plc COMPANY STRUCTURE Camping - Eurocamp Keycamp Eurocamp Independent Hotel Breaks Perfect Places Easycamp - Superbreak - Hotel Breaks - Luxury Hotel Collection - London Travel Service - Airport Hotels - Hotelnet Adventure - Explore Worldwide - Regal. Dive 2

Holidaybreak plc OVERVIEW • One of only three quoted UK tour operators • Seven years of growth in profits, eps and dividend - organic and acquisition based • Three operating divisions - different product, operations and business models but important shared characteristics. All are resilient and cash generative businesses, well placed to benefit from current holiday sector trends • 2003 turnover £ 259. 5 m, pre-tax profits £ 27. 9 m (before goodwill amortisation and exceptional costs) 3

Holidaybreak plc OUR RECORD (1) £m Turnover £m Profit Before Tax* * Before goodwill amortisation and exceptional operating costs 4

Holidaybreak plc OUR RECORD (2) Earnings per Share* Pence Dividend Pence * Before goodwill amortisation and exceptional operating costs 5

Holidaybreak plc BUSINESS STRENGTHS • Market leaders • Service and Product Quality • Multi-channel distribution • Healthy margins - well above travel industry norms • Flexible cost structures and products • Strong cash generation 6

Camping Division OVERVIEW • Original and largest part of the Group - 49% of 2003 Group sales • Two market leading brands - Eurocamp and Keycamp • 16, 000 mobile-homes and tents on high quality camp-sites in France, Italy and seven other countries • Flexible self-drive holidays, any day to any day, with ferry etc, courier/children’s courier service, tailor-made packages mainly direct sales • Mid to upper income, family customer base: c. 50% of customers non-UK (mainly German and Dutch) 7

Camping Division COMPETITIVE ENVIRONMENT • We compete in the wider family summer holiday market, in particular other self-catering holiday providers in the UK and overseas • Minimum 70% share of directly competitive market in all territories - main competitors: Canvas Holidays, Haven Europe, Holiday Life • Small scale launch by TUI in the UK in 2004 • Substantial ‘no frills’ sector in Holland and, to a lesser extent in other continental European markets - main competitors: Vacansoleil, Vrij Uit, Vacanceselect (Easycamp launched in 2003) 8

Camping Division STRATEGY • Sector resilient with high levels of customer loyalty to both brands and holiday type • Holidays must be attractive and good value - aim to deliver consistently high quality product and service standards • Growth drivers : - Trends from lower priced, lower margin tents to higher priced, higher margin mobile-homes plus upgrades within mobile-home range - Increased penetration of ‘mainstream’ self-catering markets - Greater capacity and support for premium Eurocamp and Keycamp brands - Easycamp : 2003 launch of ‘no frills’ product in Holland/Germany 9

Hotel Breaks Division OVERVIEW • Acquired 1995 - 38% of 2003 Group sales • No commitment allocations - fixed margin on selling price • Product offer: - 1500 UK 3 - 5 star hotels - Rail and theatre options - 1000 overseas hotels, 175 destinations (9% of 2003 sales) - Price guarantee on UK hotels • Several distribution channels: - High street agents (50%) - Internet (25%) (75% commissionable‘click-throughs’) - Direct (20%) - Marketing partnerships (5%) 10

Hotel Breaks Division COMPETITIVE ENVIRONMENT • Superbreak and other Holidaybreak brands account for c. 80% of all hotel leisure bookings through UK travel agents - main competitors: High Life (Thistle), Embassy (Jarvis) • Internet market much more fragmented and reliable figures not available but Superbreak is a leading hotel booking site - main competitors: Lastminute, Expedia, Active Hotels, Octopus • Superbreak provides product for many online hotel booking sites 11

Hotel Breaks Division STRATEGY • Favourable consumer trends • Simple business model - resilient, cash generative and very flexible cost base • Multi-channel distribution - internet a major growth driver but high street agents still a key element in distribution mix • Constant search for new distribution opportunities and product extensions - further small bolt-on acquisitions possible 12

Adventure Holidays Division OVERVIEW • Explore Worldwide, acquired in 2000 - 85% of divisional sales (division = 13% of Group sales) • UK market leader in worldwide adventure travel over 300 small group tours to over 100 countries on seven continents - treks, wildlife, cultural and historical tours etc. • Minimal fixed cost commitments - use flights scheduled • Regal. Dive is the leading UK specialist scuba diving holiday provider - mainly Red Sea (charter flying) but other destinations (scheduled flights) a growth area 13

Adventure Holidays Division COMPETITIVE ENVIRONMENT • Adventure Travel is a fairly loosely defined sector overlapping with other holiday types - walking, long-haul escorted tours, wildlife holidays etc • Main ‘head-to-head’ competitors are Exodus (First Choice) and The Adventure Company (E-bookers) plus a number of smaller businesses - Explore has an estimated 40%share of this sector • Regal. Dive competes with DIY divers, various smaller specialists, and non-specialist Red Sea operators. Soft period charter seats are sold in the mainstream ‘lates’ market 14

Adventure Holidays Division STRATEGY • Consumer demand for activity and ‘experience’ holidays gives sector excellent prospects - wide range of destinations mitigates effects of disruptive external events • Resilient customer base - loyalty to Explore and Regal brands • Strong commitment to Product and Distribution Development • Bolt-on acquisitions a possibility to broaden product range and/or enhance marketing reach 15

Financials 2003 RESULTS - OVERVIEW • PBT - £ 29. 7 m (+2. 9%) • EPS - 44. 4 p (+4. 5%) • Dividend - 22 p (+10. 0%) • Net debt reduced by £ 9 m All stated before exceptional operating costs and goodwill amortisation 16

Financials 2003 DIVISIONAL PERFORMANCE • Camping like for like sales down 6% (capacity: -4%) – Weak early markets, strong recovery after end of Iraq war – Integration of Euro. Sites following £ 29. 9 m acquisition in Sept 2002 – Hot summer may have deterred some late bookings but customer satisfaction levels high • Hotel Breaks had another excellent year - sales up 27% year on year – Growth in all main distribution channels (agents, direct, internet) – Acquisition of Bridge Britain/London Travel Service (£ 2 m) – Favourable conditions on demand supply sides • Adventure held back by geopolitical events (sales up 2. 1%) – – Good first quarter but deterioration as Iraq war approached Terrorist incidents and threats, SARS and regional conflicts Other regions (e. g. South America, Europe, South Africa) performed well Load factors and gross margin levels maintained 17

Financials FLEXIBILITY & CASH GENERATION • Low fixed cost ratios except in Camping where one year contracts , very early booking patterns (c. 45% pre-Christmas) and pitch options provide significant flexibility • Annual capex requirement for Camping (+/-£ 23 m in 2003: depreciation +/-£ 18 m) can be varied if capacity requirement changes (ROCE on mobile-homes: c. 33%) • Operating margins well above travel industry norms • Strong operating cash flow from all divisions - Camping very seasonal • Interest cover c. 6. 5 times in 2003 - will increase rapidly, debt capacity for acquisitions available 18

Strategy - Travel Industry Trends KEY STRUCTURAL INFLUENCES Geopolitical Uncertainty Low cost airlines Internet TRAVEL Rigid, vertically integrated tour operating model under threat Strengthening Euro Weakening Dollar Consumer holiday trends - shorter more frequent - later bookings - more independent/tailor made/flexible - holidays with purpose 19

Structural Changes IMPACT ON HOLIDAYBREAK Low-cost Airlines Positive for Camping and Hotel Breaks. No impact on Adventure. Internet Complements existing distribution channels for specialist holiday businesses. Key growth driver for Hotel Breaks Geopolitical uncertainty Consumer Trends Camping and Hotel Breaks relatively ‘safe’ holiday choices. Adventure has exposure but many alternative destinations. . Holidaybreak businesses give flexibility, choice and alternatives to standard packages Camping still an early booking business. Stronger Euro Weakening Dollar Euro still ‘mid-range’. Natural hedge for Camping due to Euro revenues. Weak dollar positive for Adventure. Vertical Integration Holidaybreak businesses not vertically integrated 20

Holidaybreak plc GROUP STRATEGY • All divisions will generate organic growth • Exploit and adapt to key consumer and supply side trends • Active product and distribution development programmes • Small ‘bolt-on’ acquisitions to act as a catalyst and open up new opportunities • Larger scale ‘fourth leg’ acquisition also a possibility – at right value – not mainstream package tour operating 21

Holidaybreak plc CURRENT TRADING AND PROSPECTS (As at 4 December 2003) • Camping sales 20% behind 2003 to date – – Mainstream market up to 30%down for summer 2004 Eurosites now integrated into Eurocamp and Keycamp Capacity: -8% planned New year bookings expected to be much stronger than equivalent ‘war build up’ period in 2003 • Hotel Breaks 2004 sales 37% up on 2003 – Internet still growing strongly – Official accommodation provider for Visit London – Launch of European Beach Breaks programme • Adventure 2004 sales 8% up on 2003 – Sales rebound in affected regions (e. g. India, Thailand, Egypt) – New product developments (Cycle, Rail) – Cautiously optimistic 22

Holidaybreak plc OVERVIEW & SUMMARY • Strong cash generative businesses - Resilient performance in 2003 - Well placed to benefit from holiday sector brands • Strategy of seeking steady organic growth supplemented by appropriate acquisitions at right value (debt capacity available) • Record shows 10 -15% EPS and dividend growth. This remains our aspiration • Encouraging start to 2004 by Hotel Breaks and Adventure. Post New Year bookings a key indicator for Camping • Market update 10 February 2004 (AGM) 23