Trading Statement

Carillion PLC
07 January 2004

7 January 2004

Carillion plc trading update

Carillion plc, the business and construction services group, is providing this
update on trading for the year ended 31 December 2003, in advance of its
preliminary results announcement on 10 March 2004.

Trading in the Group's chosen market sectors has continued in-line with
expectations, with the strong first half performance in Business Services being
sustained in the second half.  Therefore, as indicated at the half year, the
Group expects to deliver full-year profit before tax and goodwill of not less
than the £50m achieved in 2002.

In addition, the Group has generated an exceptional profit of £11 million from
the sale of its £4.1 million equity interest in the Darent Valley PPP
concession.  One third of this profit will be returned to shareholders by way of
a 1.7p dividend, which will be added to and paid with the ordinary dividend for
the year ending 31 December 2003.

This sale marked the beginning of an ongoing programme of PPP equity sales that
is expected to generate a sustainable  new profit stream.  It is the Board's
current intention to continue to return a proportion of these profits to
shareholders and to reinvest in new PPP concessions to generate further returns
for shareholders.  Further equity investments of between £20 million and £30
million are already planned in seven new PPP projects, including the John
Radcliffe Hospital, Oxford, that recently reached financial close and six
further projects for which Carillion is the preferred bidder.  These projects
will also generate construction and maintenance work worth around £2.5 billion.

The infrastructure contract for the Nottingham Express Transit project has made
good progress and will be completed in-line with the previously announced cost
overrun, which reduced first-half profit in Construction Services by £10
million.

As a result of strong second half cash flow, the Group expects to have
substantial positive net cash at the year-end.

The Group's assessment of the effects of Network Rail's decision to take all
rail maintenance in-house by September 2004 is that operating profit is expected
to reduce by around £7 million in 2004 and by £15 million in 2005 and beyond.
However, these are estimates and they may change, subject to negotiations with
Network Rail on the exact timing of contract terminations.  The total goodwill
associated with the Group's rail business is some £50 million and the proportion
of this goodwill that will be written off in 2003 is currently being assessed.

Despite the reduction in rail maintenance, the Group expects to deliver healthy
earnings growth in 2004 and beyond as a result of the strong positions it holds
in its chosen growth markets coupled with its continuing focus on cost reduction
and performance improvement.  This prospective growth, together with the profits
expected from the sale of PPP equity investments, indicates that the outlook for
the Group continues to be positive.

John McDonough Chief Executive, Chris Girling Finance Director and John Denning
Director Corporate Affairs, will host a telephone conference call on this
statement at 09:30 today, which you are invited to dial into on: 0208 515 2317.


Notes to editors

For further information contact John Denning Director Corporate Affairs 
01902 316384


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