Interim Results

CARILLION PLC
5 October 1999


                                Carillion Group

                    Half year statement (on proforma basis)
                                to 30 June 1999
                                
                                
Carillion plc 1999 interim results

Carillion plc, the construction to services company formed on 30
July  1999, today announces its interim results for the six months 
ended 30 June 1999, during which it traded as the Construction Services
arm of Tarmac.

Highlights

Operating profit up 43% to £14 million. 
Pre-tax profit £10.4 million.
Interim dividend 1.3 pence per share. 
Improved operating performance
Continued repositioning toward higher quality work.

Chairman Sir Neville Simms says, In the first six months of
1999 we made further progress towards our strategic objectives.   
The pursuit of higher quality work and an improved operating performance
resulted in increased profit and margins on slightly lower turnover.
Although it has been only two months since the demerger from Tarmac was
successfully completed, and there is still much to do, the market 
conditions, our improving operational performance and the quality and
enthusiasm of our management and staff, have reinforced my view that 
Carillion is on track to increase shareholder value substantially over the
years ahead.

For further information

Carillion plc
John Denning   (Media)    01902 316384
Tony Skelton   (Analysts) 01902 316272

Shandwick
John Reynolds  0171 329 0096
Rollo Head     0171 329 0096

Note: All the above can be contacted at the City Presentation Centre, Chiswell
Street, London on 0171 628 5646 between 0730 and 1400 on 5 October 1999 and on
the above numbers thereafter.

                       CHAIRMAN'S STATEMENT
                                 
                                 
Introduction

On 30 July 1999 shares in Carillion plc began trading on the London Stock
Exchange.  During the period reported here, however, the businesses 
which now make up Carillion formed the Construction Services arm of Tarmac
plc.

In the Listing Particulars, published for the demerger from Tarmac  plc,
Carillion laid out its strategy for accelerating growth in shareholder
value.  The key drivers included improving operating performance,  
continuing the repositioning of the group to enhance the quality of  
earnings, further developing the strong customer relationships we enjoy,
strengthening market positions through acquisition and, where appropriate,
disposing of non core activities and remaining at the forefront of change in
the UK Construction industry.  In parallel with these objectives, we will
continue to promote our leading edge environmental programme and seek to
integrate an increased awareness of the need for improved safety standards
into everything we do.

We also undertook to introduce a new financial reporting structure with 
effect from the 1999 preliminary results in order to enhance transparency.
I am pleased to report that we have been able to bring forward this
change, and these interim results are, therefore, set out on the basis of
the five new reporting segments.


Overview

In the six months to 30 June 1999 we made further  progress towards our
strategic objectives.  Turnover was 4% lower at £874m, but the pursuit of
higher quality work and an improved operating performance resulted in
a 43% increase in operating profit to £14.0m.  Operating margins also
increased from 1.1% to 1.6%.

On a pro-forma basis, interest payable was £3.6m, and profit before tax
was £10.4m.  Pro-forma net cash at the end of June was £63.8m.  
Encouragingly, the seasonal operating cash outflow was less than that in the
first half of 1998, reflecting the improving characteristics of the 
portfolio.

Pro-forma earnings per share were 3.4p.  The Board has declared an interim
dividend of 1.3p.

Business Review

Building:  turnover in our non-PFI Building activities fell by 5%
to £354m due to a combination of weaker market conditions in the
first part of the year and our greater selectivity.  However,
operating profits, including those from property development,
improved from £2.8m to £4.9m, with margins reaching 1.4%.
Overall confidence increased gradually as mid year approached and
the order book is stronger for the second half and beyond.  The
proportion of negotiated orders and work in partnership with key
clients remains  high, in line with our strategic objectives.

Capital Projects: turnover also reduced, by 8% to £239m, as a
direct result of our continuing withdrawal from higher risk
process and turnkey projects, together with a dearth of
traditional UK civil engineering projects.
Operating profits improved only slightly, to £1.1m with margins
a disappointing 0.5%.  Full year turnover will be well down on 1998 
but the cost savings from the integration of our Civil Engineering
and International businesses, combined  with the new objectives of 
the group, should, in due course, show through in higher margins 
and profits.

Services:  turnover was ahead by 11% at £157m and there was a marked
improvement in operating profits, to £4.1m.
Margins moved forward by  nearly one percentage point to 2.6%.
This resulted from an improved operating performance by our Facilities
Management activities and a usefully  increased contribution from Fleet
Management Services.

Infrastructure  Management:  which includes our road and rail maintenance
activities, showed a small decline in turnover to £117m, as a consequence  
of Railtrack's delayed release of track renewal work.  Operating profits and
margins moved steadily ahead to £5.2m and 4.4% respectively.  Whilst growth 
in maintenance work has generally matched our expectation the altered 
priority for rail track renewals has called into question the level of
resource which we should devote to this activity.  In the second half, we 
are ensuring that our capacity continues to be aligned to match market
demands.

The Private Finance segment has continued its good progress, in terms of 
work winning and execution, with the order book around 30% ahead at the
half year. Several of our major PFI projects are, however, now in the
construction phase and the start and completion timings of these have 
affected turnover and operating profit, reducing them to £44m and £1m
respectively.  Of the six preferred bidder projects which were highlighted 
in the Listing Particulars, two have now achieved financial close and we 
still expect the others to reach financial close before the year end.
Overall, our order book continues to grow and at the end of June was up 11%
at £1.9bn.  The key to Carillion's future lies in securing a business mix 
of less cyclical, higher margin activities. In accordance with these
objectives, the percentage of the order book for work more than 12 months
ahead grew to 41%, which excludes concession revenues over the next 25 to 
30 years which are estimated to be in excess of £1bn, from the concessions
we have to date.


Management

The new Board of Carillion has settled in quickly and I am pleased to 
confirm that with the appointment of Chris Girling as Group Finance Director
from the beginning of November 1999, the executive team will be complete.


Dividend

In the light of our first half performance and prospects, the Board  has
declared an interim dividend of 1.3p.  This will be paid on 1st December
1999 to shareholders on the register at the close of business on 15th October
1999.  A scrip dividend alternative will be offered.


Year 2000

Carillion established a group-wide programme in 1998 to determine the extent
to which the performance and functionality of its own systems, and the
systems and equipment on which they rely, would be affected by dates prior
to, during and after the Year 2000, and to ensure that the related risks were
mitigated.

Action plans have been developed to address key aspects  of the  programme
without disruption to the critical business processes.  Testing of software
changes, including user acceptance testing, has been carried out and
business continuity plans for the Year 2000 have been developed.  This 
programme has been  regularly monitored by the Board and is now 
substantially complete.  We continue to progress contingency plans for the
roll over period.


Prospects

After an uncertain start to the year in the UK, confidence - tempered
with some caution - has returned to the economy and with it the expectation
of further growth over the next 2 to 3 years in building construction and
related activities.  Our Building segment is well positioned to take advantage
of these market conditions and to benefit further from its focus on
partnership with our key account customers.

Expenditure on new basic UK infrastructure remains unrealistically low,
particularly when compared to our continental European trading partners.
However, the Government remains committed to the Private Finance/Public
Private Partnership programme and also to the continued outsourcing of
operation, maintenance and services at both National and Local Government
levels.  These growing activities lie at the heart of our strategy and
Carillion will continue to direct its resources and skills towards  them,
to maximise the benefits for shareholders.

The markets for our established regional activities overseas are
all in better shape  than  for  a  number  of years, although the
full benefit from these businesses will not show through until we have 
completed the managed withdrawal from turnkey and process projects.

At the time of the demerger, I expressed my confidence in the future of
Carillion plc as an independent construction to services group.  Although
it has only been two months since the demerger was successfully completed, 
and there  is  still much to do, the market conditions, our improving 
operational performance and the enthusiasm of the management for the 
challenges and opportunities ahead have reinforced my view that Carillion
is on track to increase shareholder value substantially
in the years ahead.




Sir Neville Simms
Chairman



Carillion Group Proforma Unaudited Consolidated Profit and Loss
Accounts for the half year to 30 June 1999


                                 Half year   Half year      Year to
                                to 30 June  to 30 June  31 December
                                      1999        1998         1998
                                        £m          £m           £m

                                    
Total turnover                       873.5       910.3       1,866.1
Deduct turnover of joint             (88.8)      (79.0)       (183.6)
ventures


Group turnover                       784.7       831.3       1,682.5

                                     ======      =====       =======
Group operating profit before          9.2         3.8          20.9
exceptional operating items
Exceptional operating items              -           -          (4.5)

Group operating profit                 9.2         3.8          16.4
Group share of operating profit
of joint ventures:
    Operating  profit  before          4.8         6.0          22.1
    exceptional items
    Exceptional operating items          -           -          (1.4)
                        
                                     ------      -----        -------

Total operating profit                14.0         9.8          37.1

                                     ------
Net interest payable:    
    Group                             (1.9)      =====        =======
    Joint ventures                    (1.7)

                                     ------
                                      (3.6)



Profit  on  ordinary activities       10.4
before taxation
Taxation  on profit on ordinary       (3.5)
activities


Profit  on  ordinary activities        6.9
after taxation
Equity minority interests                -
Profit for the financial period        6.9
Equity dividends                      (2.7)



Retained profit for Group and          4.2
its share of joint ventures
                                      ====

Basic earnings per ordinary            3.4p
share
                                      ====

Dividends per ordinary share           1.3p

                                      ====


The proforma profit and loss accounts have been produced on the basis that 
the companies and businesses forming the Carillion Group had been within  
a statutory group for the half year ended 30 June 1999 and for the year 
ended 31 December  1998.  The basis of preparation is more fully set out 
in note  1.

The financing arrangements from 1 January 1999 are substantially different
from those previously prevailing.  Interest payable and, consequently,
earnings per ordinary share for the six months ended 30 June 1998 and the year
ended 31 December 1998 are unlikely to be comparable with subsequent periods. 
In view of this, only comparative figures down to total operating profit have
been provided.



Carillion Group Proforma Unaudited Consolidated Balance Sheet

                                            At                At
                                       30 June       31 December
                                          1999              1998
                                            £m                £m 
Fixed assets
Goodwill                                  1.7               1.7
Tangible assets                          57.2              60.5
Investments in joint ventures:  
   Share of gross assets         269.5          268.6
   Share of gross liabilities   (237.7)  31.8  (228.5)     40.1 
                                        ------           ------
                                         90.7             102.3
                                        ------           ------

Current assets
Stocks                                   61.1              56.8
Debtors                                 540.5             514.8
Investments                               4.8               1.6
Cash at bank and in hand                 70.7             153.0
                                       ------            ------
                                        677.1             726.2

                                       ------            ------

Creditors: amounts falling due
within one year
Bank loan and overdrafts                (6.8)              (5.8)
Other creditors                       (639.2)            (702.4)
                                      -------            -------
                                      (646.0)            (708.2)
                                      -------            -------
Net current assets                      31.1               18.0
                                      -------            -------

Total   assets  less   current         121.8              120.3
liabilities
Creditors: amount falling  due
after more than one year
Bank loans                              (0.1)              (0.2)
Other creditors                         (6.2)              (9.2)

                                      -------            -------
                                        (6.3)              (9.4)

Provisions for liabilities and          (3.9)              (3.9)
charges                               -------            -------

Net assets                             111.6              107.0
                                      =======            =======


Financed by capital and
reserves
Called up share capital                102.3              102.3
Reserves                                 9.2                4.6

                                      -------            -------
Equity shareholders' funds             111.5              106.9
Equity minority interests                0.1                0.1
                                      -------            -------

Total capital employed                 111.6              107.0

                                      =======            =======

The proforma balance sheets show the net asset position of the Group on the
basis that the capital reorganisation had taken place at 31 December 1998 as
outlined in the basis of preparation note.

Proforma statement of total recognised gains and losses

                                   Half year to            Year to
                                        30 June        31 December
                                           1999               1998
                                             £m                 £m
                                             
Profit for the financial period            6.9                5.8
Currency adjustment                       (0.4)              (2.9)
                                          -----              -----
                                           6.5                2.9
Dividends                                 (2.7)                 -
Other movements                            0.8                  -
                                          -----              -----

Total recognised gains and losses for      4.6                2.9
the period
Opening shareholders' funds              107.0              104.1
                                         ------             ------
Closing shareholders' funds              111.6              107.0
                                         ======             ======


Summarised Proforma Consolidated Group Cash Flow Statement and
Reconciliation of Net Debt
                                   Half year to            Year to 
                                        30 June        31 December
                                           1999               1998            
                                             £m                 £m

Net cash outflow from operating          (84.8)             (50.8)
activities
Debenture (payment)/repayment(to)/from    (9.2)               9.2
a joint venture
Net  cash inflow/(outflow) from returns   18.1              (16.2)
on investments and servicing of finance
Corporate taxation paid                   (0.8)              (5.5)
Net cash outflow from capital             (6.2)              (9.0)
expenditure and financial  investments
Net cash (outflow)/inflow from            (0.3)              14.0
acquisitions and disposals
                                          -----             ------

Net outflow before management of liquid  (83.2)             (58.3)
resources and financing

Net outflow from management of liquid         -              (0.1)
resources

Financing - repayment of debt             (0.1)              (0.1)


Decrease in cash in the period           (83.3)             (58.5)

                                         ======             ======

The proforma cash flow statements have been produced on the basis that the
companies and businesses forming the Carillion Group had been within a
statutory group for the half year ended 30 June 1999 and for the year 
ended 31 December 1998.  The basis of preparation is more fully set out in 
the basis of preparation note.

Reconciliation of net cash flow to movement in net debt

                                   Half year to            Year to
                                        30 June        31 December
                                           1999               1998
                                             £m                 £m

Decrease in cash                         (83.3)             (58.5)
Cash outflow from management of liquid       -                0.1
resources
Repayment of debt                          0.1                0.1
Effect of foreign exchange rate changes      -                0.3

                                         ------             ------
Movement in net funds in the period      (83.2)             (58.0)
Net funds at start of period             147.0              205.0
                                         ------             ------


Net funds at end of period                63.8              147.0

                                         ======             ======

Reconciliation of operating profit to operating cash flows

                                   Half year to            Year to
                                        30 June        31 December
                                           1999               1998
                                             £m                 £m

Group operating profit                     9.2               20.9
Depreciation                               6.4               13.5
Amortisation of goodwill                     -                0.1
Decrease in provisions                       -              (35.4)
Increase in stocks                        (4.3)             (14.6)
Increase in debtors                      (25.4)              (6.3)
Decrease in creditors due within one year(68.3)             (34.0)
(Decrease)/increase in creditors due      (2.0)               2.1
after more than one year
(Decrease)/increase in bills of exchange  (0.1)               7.4
Profit on disposal of fixed assets        (0.3)                 -
                                         ------             ------
Net cash outflow from operating          (84.8)             (46.3)
activities before exceptional items
Exceptional operating cash spend             -               (4.5)

                                         ------             ------

Net cash outflow from operating          (84.8)             (50.8)
activities                               ======             ======



Notes

1  Basis of preparation

Carillion plc acquired its subsidiary companies and businesses on demerger
from Tarmac plc which completed on 30 July 1999. A proforma half year
statement for the period ended 30 June 1999 has been produced on the basis
that the companies and businesses forming the Carillion Group had been 
within a statutory group for the half year ended 30 June 1999 and for the 
year ended 31 December 1998.

The accounting  policies adopted are consistent with those set out in the
accountants report on the Carillion Group contained within the Listing
Particulars dated 15 June 1999. Merger accounting has been adopted.
The  proforma  profit and loss accounts incorporate the  results of all the
companies and businesses forming the Carillion Group for the periods
reported.  No adjustments have been made to either the interest cost or the
tax charge to reflect the new capital and debt structure of the Carillion
Group.

The proforma profit and loss accounts for the half years ended 30 June 1999
and 1998, the proforma balance sheet at 30 June 1999 and the proforma cash
flow statement for the half year ended 30 June 1999 have been extracted from
unaudited management information.  The financial information has been 
adjusted where appropriate on a proforma basis to reflect the formation of 
the Carillion Group.  The proforma profit and loss account for the year
ended 31 December 1998 and the proforma balance sheet as at 31 December 1998
have been extracted from the Listing Particulars.  The proforma cash flow
statement for the year ended 31 December 1998 is based on the cash flow
statement set out in the  Listing Particulars adjusted on a proforma basis to
reflect the formation of the Carillion Group.

These adjustments include the elimination at 31 December 1998 and 30 June
1999 of the loan account with Tarmac plc as follows:


                                             At                 At
                                        30 June        31 December
                                           1999               1998            
                                             £m                 £m

Subscription for shares in Carillion      95.9               95.9
Group Companies
Transfer of group relief                  23.1               23.1
Cash dowry                               (12.4)             (12.4)
Proforma settlement of Tarmac loan        68.2                  -
account movement in the half year to 30
June 1999                                ------             ------

Total loan account balance eliminated    174.8              106.6

                                         ======             ======


As Carillion plc was not incorporated until 28 May 1999 the  financial
information in respect of the year ended 31 December 1998 does not 
constitute statutory accounts. The statutory accounts of the companies
that form members of the Carillion Group made up to 31 December 1998 have 
been delivered to the Registrar of Companies. The auditors have reported on
those accounts, their reports were unqualified and did not contain
statements under section 237(2) or (3) of the Companies Act 1985.


2  Segmental analysis

                  Half year ended 30 June                 Year ended 
                 1999                1998           31 December 1998
           Turnover Operating  Turnover Operating Turnover Operating
                       profit              profit             profit
Class of         £m        £m        £m        £m       £m        £m
business

Building       353.7      4.9     374.1       2.8    774.6      15.5
Capital 
Projects       238.7      1.1     258.2       1.0    533.6       3.4
Services       157.1      4.1     141.4       2.6    287.6       5.6
Infrastructure 117.1      5.2     119.1       4.9    256.7      14.7
Management
Private Finance 44.0      1.0      53.7       1.9     97.1       4.8
Less:Inter     (37.1)       -     (36.2)        -    (83.5)        -
     segment
     Tarmac        -     (2.3)        -      (3.4)       -      (6.9)
     management
     charge

               873.5     14.0     910.3      9.8   1,866.1      37.1

Share of joint ventures

The segmental analysis of the Group's share of joint ventures is set out
below:

                  Half year ended 30 June                 Year ended 
                 1999                1998           31 December 1998
           Turnover Operating  Turnover Operating Turnover Operating
                       profit              profit             profit
Class of          £m       £m        £m        £m       £m        £m
business

Building            -     1.4       3.1      0.5      20.6       5.8
Capital Projects 34.9    (2.8)     28.4      0.6      66.5       2.4
Services            -       -         -        -         -         -
Infrastructure   52.2     4.1      41.8      3.8      89.8       9.8
Management
Private Finance   7.9     2.1       5.7      1.1      12.8       2.7
Less:   Inter    (6.2)      -         -        -      (6.1)        -
        segment

                 88.8     4.8      79.0      6.0     183.6      20.7

Geographical analysis by market served

Turnover and operating profit analysed by geographical market served is as
follows:

                  Half year ended 30 June                 Year ended 
                 1999                1998           31 December 1998
           Turnover Operating  Turnover Operating Turnover Operating
                       profit              profit             profit
                 £m        £m        £m        £m       £m        £m
                 
UK            728.5       9.1     771.5       8.0  1,560.4      25.9
Europe         80.7       0.3      69.2      (0.3)   123.8       0.3
Other          64.3       4.6      69.6       2.1    181.9      10.9


              873.5      14.0     910.3       9.8  1,866.1      37.1


3  Interest

For the half year ended 30 June 1999 group interest payable includes
amounts payable to Tarmac plc which were based on the proforma recapitalised
structure of  the  Carillion Group.  Prior to 1 January 1999 interest payable
to  Tarmac plc  was based on the actual funding arrangements which were in
place in  that period.

Consequently, interest payable and earnings per ordinary share for the 
period ended 30 June 1999 are unlikely to be comparable with previous 
periods.

4  Taxation

Taxation has been calculated at 33.7%, the estimated effective tax rate for
the year ending 31 December 1999.

5  Dividends

The interim ordinary dividend of 1.3p per share (1998: not applicable) will 
be paid on 1 December 1999, to shareholders on the register at the close of
business on 15 October 1999.

The proposed dividend is in respect of the profit in the operations forming
the Carillion Group for the six months ended 30 June 1999.  Carillion plc 
was incorporated on 28 May 1999 and its first statutory accounts are to be
made up to 31 December 1999.  Accordingly in able to support the payment of 
the proposed  dividend initial accounts made up to 31 July 1999 have been
prepared and will be filed at Companies House.

6  Earnings per ordinary share

Basic

Full earnings per ordinary share figures have been calculated as
if the shares were in issue throughout the period using the actual
number of ordinary shares issued  on  demerger  and the proforma
consolidated profit for the relevant financial period.  The number 
of 50p ordinary shares issued on demerger was 204,674,861.

Diluted

As at 30 June 1999 the company has announced its intention to operate
three share option schemes details of which were contained in the Listing
Particulars dated 15 June 1999.  As at 5 October 1999 no options had been
issued and accordingly it has not been possible to calculate proforma 
diluted earnings per share figures.

7  Year 2000

Carillion established a group-wide programme in 1998 to determine the extent
to which the performance and functionality of its own and third party systems
and equipment would be affected by dates prior to, during and after the Year
2000, and to ensure that the related risks were mitigated.

Action  plans  have  been developed to address key aspects of the programme
without disruption to the critical business processes.  Testing of software
changes, including user acceptance testing, has been carried out and 
business continuity plans for the Year 2000 have been developed.  This 
programme has been regularly monitored by the Board and is now substantially 
complete. Continued progress is being made towards finalising contingency
plans for the roll over period.

8  Approval of interim statement

The interim statement was approved by the Board of Directors on
5 October 1999.



Independent review report by KPMG Audit Plc to Carillion plc

Introduction

We have been instructed by the company to review the financial
information set out on pages 5 to 11 and we have read the other
information contained in the interim report and considered
whether it contains any apparent misstatements or material
inconsistencies with the financial information.

Directors' responsibilities

The interim report, including the financial information contained
therein, is the responsibility of, and has been approved by, the
directors.  The Listing Rules of the London Stock Exchange require 
that the accounting policies and presentation applied to the interim 
figures should be consistent with those applied in preparing the 
preceding annual accounts (for  which  purpose  the accounting policies
disclosed in the Listing Particulars dated 15 June 1999 have been taken)
except where they are to be changed in the next annual accounts in which 
case any changes, and the reasons for them, are to be disclosed.

Review work performed

We conducted our review in accordance with guidance contained
in Bulletin 1999/4:  Review of interim financial information
issued by the Auditing Practices Board.  A review consists
principally of making enquires of group management and applying
analytical procedures to the financial information and underlying
financial data and, based thereon, assessing whether the accounting 
policies and presentation have been consistently applied unless otherwise
disclosed.  A review is substantially less in scope than an audit performed 
in accordance  with Auditing Standards and therefore provides a lower level
of assurance than  an audit.  Accordingly we do not express an opinion on
the financial information.

Review conclusion
On the basis of our review we are not aware of any material
modifications that should be made to the financial information
as presented for the six months ended 30 June 1999.





KPMG Audit Plc
Chartered Accountants, Birmingham