Trading Statement

Carillion PLC
10 July 2002

Carillion plc trading update

Carillion plc, the business and construction services company, is providing this
update on trading for the six months ended 30 June 2002 in advance of its
interim results announcement on 11 September 2002.

Overall trading in the first six months of 2002 was in line with our growth
expectations and interim profit is expected to reflect the first-half weighting
typical for our business.

We have continued to pursue our strategy for growing good quality earnings
through developing our Business Services and Investments activities, while
maintaining a selective approach in Construction Services, where our focus is on
larger higher added value contracts. Activity levels in Construction Services in
the first half were lower due to continuing selectivity and the number of
contracts successfully reaching or approaching completion. Consequently, we
again expect an increasing proportion of our profit to come from Business
Services and Investments.

The Group interest charge remains close to zero despite the expected cash
outflow in the first six months of the year due to the lower activity levels in
Construction Services.

In the first half of 2002 we secured some £1 billion worth of new contracts to
maintain our order book at over £5 billion. Details of new contract successes
and preferred provider positions, together worth up to £600 million, are being
announced separately today.

We have made good progress with our Business Improvement Programme, which is on
track to meet all its objectives and deliver in full the benefits announced
previously, including annual savings of around £5 million per annum by 2003.
Therefore, savings in 2002 are likely to be higher than originally anticipated.

Looking forward, we expect our main markets in Business Services and Investments
to continue to offer good opportunities for growth and that our key Construction
Services markets will either remain firm or grow.

In reporting our first half results we will be adopting UITF Abstract 34, which
concerns the treatment of pre-contract bid costs, and FRS 19, which changes the
way deferred tax is accounted for. The implementation of these standards does
not affect cash or reflect any change in the performance of the business.

The adoption of UITF Abstract 34 will give rise to a minor prior year adjustment
in respect of our PPP activities over the past eight years. Going forward, the
adoption of UITF Abstract 34 is expected to reduce operating profit in a full
year by approximately £6 million in both 2002 and 2003 thereafter to improve
operating profit over the next few years by similar amounts. FRS 19 will have a
small beneficial effect on our future effective tax rates.

We expect the overall effect of these changes together with the better than
expected progress made with the implementation of our Business Improvement
Programme, to leave us on course to deliver earnings per share in line with the
current consensus forecast for 2002.

Carillion Chief Executive, John McDonough and Finance Director, Chris Girling,
will host a telephone conference call on this statement at 09.00 today. The
number to call to join the conference is 0208 515 2370.

For further information

John Denning, Director Group Corporate Affairs, 01902 316426

John Davies, Corporate Communications Manager, 01902 316444




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