Trading Statement

Costain Group PLC
30 June 2004


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


Trading Update


Costain is today providing an overview of activity for the first six months
ending 30 June 2004 and an update on current trading ahead of its interim
results, which will be announced on Wednesday 1st September.

The Group has continued to make good progress over the first half of the year,
further evidence of the success of its strategy of pursuing partnership
arrangements across all its business divisions and focusing on its chosen areas
of expertise such as water, transport and healthcare.

During this period, the Group has preserved its order book and is in the process
of tender and negotiation with the major UK Water Utilities for delivery of
capital works programmes into AMP 4 - the Government's next regulatory period
for the water industry commencing in April 2005.  The first of these
announcements is expected in the Summer of 2004.

The continued progress of the Channel Tunnel Rail Link and the A303 Stonehenge
projects give Costain a strong civil engineering base.  In the Building
division, Costain has focused on, and made significant progress in, specific
market sectors such as health, retail and education.  The Group is in final
negotiation on a number of quality schemes built around a secure client base.

The Group's International division has formalised an alliance with China
Harbour, one of China's largest construction groups, to pursue global
opportunities specifically in the area of marine development and port
construction.  The joint venture has already had early success in pre-qualifying
for a major port rehabilitation in West Africa.

Overall, the Board remains encouraged by the progress made in the first half of
the year, and is confident that the Group's performance is in line with market
expectations.

                                                                    30 June 2004


Enquiries:

Costain Group PLC                                            Tel: [phone]
    Stuart Doughty, Chief Executive
    Charles McCole, Finance Director
    Graham Read, Public Relations

College Hill                                                 Tel: [phone]
    Mark Garraway
    Matthew Gregorowski


                      This information is provided by RNS
            The company news service from the London Stock Exchange