Award of Greater Western and Thameslink/GN fran...

Embargoed until 0700hrs on 13 December 2005

                                FIRSTGROUP PLC                                 

                           (`First' or `The Group')                            

   STATEMENT RE: AWARD OF THE GREATER WESTERN AND THAMESLINK/GREAT NORTHERN    
                                  FRANCHISES                                   

FirstGroup plc, the UK's largest surface transport company, today welcomed the
announcement by the Department for Transport (DfT) to award both the Greater
Western and Thameslink/Great Northern franchises to the Group. These new
franchises, worth over £1 billion in revenue per annum, will commence operation
on 1 April 2006.

Commenting on the two franchise awards, Moir Lockhead, Group Chief Executive
said: 'We are delighted to be awarded both of these franchises and look forward
to delivering the improved performance, capacity, facilities and customer
benefits proposed in our winning bids. We are now the UK's largest rail
operator and will carry more than 260 million passengers per annum'.

Details of the two new franchise awards are as follows:

Greater Western Franchise

The new Greater Western franchise, which combines First Great Western, First
Great Western Link and Wessex Trains, will commence on 1 April 2006 and run for
seven years with a potential extension for three further years.

The new franchise will generate £1 billion in premium payments to DfT over the
full 10 year period.

Commenting, Moir Lockhead, Chief Executive, FirstGroup plc said:

'We are delighted to be awarded the contract to run the enlarged Greater
Western franchise. We consulted widely with stakeholders across the franchise
area and submitted a robust and innovative bid. We are proud to serve customers
across the new enlarged franchise area and look forward to building on our
strong record of service delivery and investment.

I'd like to take this opportunity to thank the many stakeholders who supported
our bid and, not least, our staff who have worked hard to achieve this result
and continually strive to provide exceptional customer service for passengers
throughout the Greater Western region.

We have the experience, drive and proven track record to transform travel for
the Greater Western region, setting a new standard for customer service. Our
priority now is to ensure a smooth integration of the three companies in April
next year; a new Timetable in December 2006; and the early delivery of
enhancements in services for passengers.

The key highlights of the new franchise include:

  * A programme of continuous improvement and investment bringing a wide range
    of customer benefits, increased capacity, safety and service. In addition
    we will focus on tackling deep-rooted performance issues on the Greater
    Western network.
   
  * The creation of a new family of brands for the franchise: First Great
    Western Express - high speed intercity services, First Great Western Link -
    suburban services out of London Paddington and First Great Western Local -
    regional services (mainly former Wessex Trains services)
   
  * Investment of c.£200m in the franchise including:
   
Significant investment in the train fleet, the vast majority of which will take
place in the first two years. The interiors of First Great Western's High Speed
Trains (HST) fleet will be totally redesigned providing a step change in
passenger comfort and facilities together with increased capacity. The first
set of redesigned carriages will be delivered in the first six months of the
new franchise. Simultaneously the power cars will be overhauled and fitted with
new quieter and more environmentally friendly engines which will provide
greater efficiency and reliability

We will work with the DfT to introduce HST2, a replacement fleet of high speed
trains, in accordance with the DfT led plans to provide a new generation of
trains for the franchise.

Local and Link fleets will go through a programme of improvements and interior
uplifts throughout the franchise term - including installation of CCTV cameras
to enhance passenger security.

An investment in station enhancements, occurring in the early years of the
franchise, including new ticket machine technology and upgrades to passenger
facilities such as waiting rooms, toilet facilities and ticket offices at
stations.

An additional 1700 car parking spaces. In addition we will provide cycle
parking facilities at every station.

Enhancements to station and car park security with new and upgraded CCTV and
CIS and Help Points installed at stations across the network. We will also
increase the number of stations we operate in the Secure Stations Scheme.

Introduction of new automatic gates at Plymouth, Exeter St Davids, Bath Spa,
Swindon and platforms 9-14 at London Paddington.

New ticket issuing technology and IT support to radically improve the service
to our customers

Restaurant services retained and an increase in at-seat catering offered to
passengers.

The installation of air conditioning to the driver cabs of our Turbo class 16X
fleet.

Retention of overnight sleeper services between London Paddington and Plymouth/
Penzance.

All day half hourly services between Paddington, Bristol and Cardiff
maintained.

A more than 20% morning peak increase in seats between Reading and London and
more than 30% in the evening peak through investments in the fleet, more
rolling stock and improved timetabling.

Retention of fast off-peak services for Slough.

Additional enhancements to the timetable including:

  * additional morning and evening peak services at Twyford, Maidenhead and
    Slough
   
  * additional peak stopping trains between Paddington and Slough running every
    30 minutes
   
  * New cross Bristol services with through trains between Worcester and
    Taunton, Cardiff to Westbury/Southampton/Weymouth and Weston-super-Mare and
    Filton
   
  * regular hourly service between Westbury and London Paddington
   
  * regular hourly services at Taunton and Newton Abbot with some faster
    journey times
   
  * Reading/Gatwick service increased from hourly to half-hourly off peak
   
- faster journey times between Cheltenham and London

- better main line connections with trains on the Cornwall branches

  * As part of our commitment to work with Network Rail to deliver 90% PPM by
    2011/12 we will work together closely in a new fully integrated control
    centre.
   
  * Network Rail has an agreed programme of investment in the infrastructure
    across the network through a programme of renewals and upgrades. We will
    support them in managing this and is also committing to invest a further £
    12m in Depots and Wash Plants and the upgrade of the line between Reading
    and London in order to improve the line speed creating greater capacity,
    reliability and improved journey times.
   
  * A new management structure with the appointment of 4 regional directors to
    provide a stronger local focus.
   
  * A significant investment into a range of staff training and development
    activities focusing on the principles of customer service excellence.
   
  * Improved connections; greater emphasis on integrated travel; and improved
    marketing to grow the business - particularly encouraging a switch from the
    car.
   
Thameslink/Great Northern Franchise

The new franchise, to be renamed First Capital Connect, will bring together two
key franchises operating across London and the South East.

The franchise will run for up to nine years, depending upon performance targets
and implementation of the anticipated Thameslink Programme. (It has a
performance-related break clause after 4 years, and is extendable, at the DfT's
discretion, to a total of between 6 and 9 years).

First will invest more than £52 million, the majority in the first three years,
to boost passenger service quality. Root and branch reforms will be driven by a
new customer service director who will focus on raising both station and on
board train performance and standards.

Changes will include cleaner, smarter trains and stations, better ticketing
facilities, customer friendly staff and better security combined with more
reliable and punctual services.

First will pay £808 million in premium payments to the Government over the nine
year term.

Commenting, Moir Lockhead, Chief Executive, FirstGroup plc said:

'We are delighted to be awarded the contract to run the Thameslink/GN
franchise. We are passionate about delivering quality services to customers and
are excited about the opportunity to improve the current service.

We consulted widely with stakeholders in the region and submitted a robust and
customer-focussed bid. Our priority now is to ensure a smooth start up in April
next year and the early delivery of enhancements in services for customers.'

Key features of the new franchise are:

  * A focus on reducing delays resulting in continually improving performance
   
  * A more secure travelling environment through a wide range of security
    enhancements including additional CCTV cameras, help points and investment
    in a team of 24 dedicated Police Community Support Officers and five
    additional British Transport Police Officers
   
  * An investment programme of £52m mainly targeted at:
   
Station improvements, including upgraded waiting facilities and toilets and
enhanced passenger information systems

Improving car parks across the franchise with upgraded facilities, additional
CCTV, information points and security with a commitment to improve Park Mark
Safer Parking accreditation and creating 600 additional spaces

Rolling stock enhancements to improve reliability and the customer environment
including upgrading the interiors of the Thameslink fleet

Automatic ticket gates at 11 stations to improve security, reduce ticketless
travel and cut vandalism

Self service ticket machines to ensure customers have easy access to purchasing
tickets across the network

Staff training and development with a commitment to achieve Investors in People
accreditation by 2008

  * The development of 24-hour airport services to Gatwick and Luton
   
  * A commitment to work with Network Rail and other rail partners to deliver
    the new station and the only cross London dedicated heavy rail link to the
    high speed Channel Tunnel services due to start from St Pancras in 2007
   
  * The introduction of PLUSBUS schemes and provide extra cycle parking
   
  * We will develop and test new products including an `Earlybird' discount for
    commuters travelling before the busiest trains.
   
First is committed to increasing capacity on this congested part of the
commuter rail network through:

  * The introduction of the new Thameslink timetable boosts peak time capacity
    for commuters by up to 10,000 seats a day.
   
  * The extra capacity will be split between morning and evening peaks and will
    be mainly for Thameslink services north of London where trains are most
    crowded.
   
  * An increase in GN services through selected enhancement works (the
    feasibility of which will be established within the first year of the
    franchise). Options include extra, longer trains and infrastructure
    enhancements; and
   
Co-operation with DfT, Network Rail and other industry partners to deliver the
Thameslink Programme.

Contacts

FirstGroup plc:

Moir Lockhead, Chief Executive 020 7291 0512

Dean Finch, Group Finance Director 07788 178942

Rachael Borthwick, Head of Corporate Communications 020 7291 0508

Martin Helm/Stuart Bugg, Corporate Communications 020 7291 0507/0514

A conference call for analysts will be held at 9:00am today. Please contact 
Sonja Reilly, FirstGroup on 020 7291 0512 for details.