Interim Management Statement

Costain Group PLC
08 May 2008



Costain Group PLC
('Costain' or the 'Group')





AGM and Interim Management Statement


The Costain Group is issuing, ahead of its AGM to be held later today, its first
Interim Management Statement covering the period from 1 January 2008 to the
current date.



Overview


Following a strong result in 2007, the Group has continued in the first quarter
to perform in-line with its expectations.  During the period, Costain has
secured new orders and preferred bidder positions following a number of high
quality awards. The Group's 'Being Number One' strategy continues to provide
stability and focus in its key targeted sectors.



Order Book


The Group's high quality forward order book has increased by 19% to £1.9 billion
and the Group's preferred bidder position has grown significantly to in excess
of £1 billion.



Operations


Civil Engineering, which incorporates the Group's infrastructure and
environment-related activities, has made an encouraging start to the year.

In Infrastructure, the division secured in joint venture a major contract on the
A14 in Cambridgeshire; an advance works contract at Farringdon Station as part
of the Thameslink Capacity Enhancement Project in north London; and is preferred
bidder on the Bell Common tunnel project on the M25.

In Environment, Costain, as a 40% member of the 4D consortium, was delighted
earlier this week to win a five-year extension to its AMP4 contract for Southern
Water.  The extended contract gives the Group early visibility of a major
earnings stream from 2010 through to 2015.  In addition, the Group is the
preferred contractor for the Award for an enlarged Container Terminal from Port
of Felixstowe, part of the Hutchison Whampoa Group.

In the Building division, work continues on improving margin performance
following the remedial actions put in place during 2007, including a
re-alignment into key sectors.  The Group has been awarded preferred status on
the Newbury Parkway development for Shearer and Standard Life.

The Group's Oil, Gas and Process division is continuing to perform well in very
good market conditions and was recently awarded a contract for E.ON's Holford
Underground Gas Storage project.

Whilst conditions in Spain remain challenging, the Group's land development
division continues to progress the sale of land, further planning approvals and
the development of the marina concession project announced last year.




Board


On 1 January, David Allvey became Chairman following David Jefferies'
retirement.  Also in January, James Morley joined the Board as a non executive
director. Bill Ballard retired from the Board on 7 May and Azman Sulaiman also
stepped down as a non executive director on the same day.



Outlook


The Board expects further progress during the current year in line with its
expectations.

The Group's strategic focus is on blue chip customers who are expected to
continue implementing their long-term investment programmes even in a period of
heightened market uncertainty.  The Group's order book is in good shape and with
robust finances, a strong cash position and rigorous cost management, Costain is
in a strong position to capitalise on the many available opportunities.




                                                                      8 May 2008



ENQUIRIES:


Costain Group PLC                                             Tel: [phone]
Andrew Wyllie, Chief Executive
Tony Bickerstaff, Finance Director
Graham Read, Public Relations

College Hill                                                  Tel: [phone]
Mark Garraway

Adam Aljewicz




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