Trading Update

Holidaybreak PLC
07 September 2004


For Immediate Release                                          7 September 2004



                                HOLIDAYBREAK PLC

               TRADING UPDATE AND CAMPING DIVISION REORGANISATION


Holidaybreak plc (LSE: HBR), the UK's leading operator of specialist holidays,
today issues the following update on trading.


As the summer holiday season and Holidaybreak's 2004 financial year draw to a
close we take the opportunity to provide an update on our trading performance
together with an announcement on a reorganisation within the Camping division.
We are also able to give an indication of current order intake for 2005.



Summary

Holidaybreak has once again proved to be a resilient, very profitable and highly
cash generative business in 2004.


   •   Hotel Breaks - sales currently 23% up on 2003
   •   Adventure - sales currently 14% up on 2003
   •   Camping - sales currently 5% down on 2003
   •   Encouraging bookings for 2005 in all three divisions
   •   Two new senior management appointments in the Camping division
   •   Relocation of Keycamp with anticipated annual cost savings of c.£1.0m
   •   Exceptional costs of £2.5m and likely goodwill impairment in Camping
   •   Continued cash generation


With strong trading from the Hotel Breaks and Adventure divisions throughout the
year and the recent improved performance from Camping, the Board anticipates
reporting a result (pre-exceptional costs and goodwill impairment) for the year
to 30 September 2004, in line with its previous (May 2004) expectations.



For further information, please contact:


Holidaybreak                                               From 11:30am
Richard Atkinson, CEO                                      07785 551 442
Bob Baddeley, FD                                           07785 983 876
                                                           From 2pm onwards
                                                           01606 787102
Buchanan Communications
Tim Anderson / Mary-Jane Johnson                           020 7466 5000




Hotel Breaks

Our Hotel Breaks division has achieved another outstanding performance.  Growth
through high street travel agents, where we are market leader, has again been
supported by increases through direct and internet sales channels.  Cumulative
sales for the year to 30 September 2004 are now 23% ahead of the 2003 equivalent
figure and operating margins have improved.  Year on year growth has been
maintained during the summer months although, as anticipated at the time of our
2004 Interim Results announcement, the rate of increase has been slower in the
second half.

Sales for the first few weeks of 2005 have continued at a healthy rate, running
at approximately 8% up on 2004 comparatives week on week. However, with the
majority of bookings being made within a few weeks of departure or less, it is
too early to identify clear trends.


Adventure

The Adventure division has also had an excellent year.  Cumulative sales
currently stand 14% up on 2003 equivalents and tour load factor increases have
had a positive impact on margins. Explore Worldwide has consolidated its market
leadership position in the sector and is benefiting from its recent product
developments.  Adventure short breaks, Family Adventures, Cycling and Rail Tours
are all now an integral part of the product mix.

As travellers' confidence has returned, long haul destinations such as South
America, South Africa and India have been particularly in demand this year. The
Middle East, notably Egypt, has recovered strongly which is reflected in a very
strong performance by RegalDive our specialist scuba diving business, the
majority of whose customers travel to the Red Sea.

Sales for both businesses for the early part of the year to 30 September 2005
have been strongly positive and are currently 45% up on 2004.  With close to 40%
of total turnover for the year to 30 September 2004 already achieved, this
provides an excellent foundation for the coming year's campaign.

Camping

As previously reported in our 2004 Interim Results announcement, the Camping
division had experienced lower than expected sales up to that date. Trading
through the summer months has been broadly in line with expectations with strong
late demand. Cumulative year on year sales are currently 5% below the like for
like 2003 figure and some further cost savings have been realised.

This has been a difficult year but Camping remains a highly profitable business.
It has the two leading brands in the sector (Eurocamp and Keycamp) and has
consistently achieved healthy returns on capital invested. Plans for 2005 are
well advanced. New senior management appointments and a rationalisation of our
UK and Dutch office operations are reported below.  Marketing campaigns include
a greater emphasis on internet distribution and the recruitment of early
bookers.  Sales activity on the camp-sites has been stepped up and, whilst it is
too early to draw firm conclusions, we have been encouraged by the initial
returns for 2005.  Booking volumes to date are 15% up on the like for like 2004
figures.


CAMPING DIVISION REORGANISATION

Holidaybreak's Camping division has been the subject of a major review in recent
months, led by managing director Matthew Cheetham who joined Holidaybreak in
January 2004.   Accommodation capacity will be reduced by approximately 11% with
a consequent reduction in net capital expenditure to approximately £6m in 2005
(2004: £13m).  The generation of sales in the pre-Christmas period has been made
a key priority and more resources are being allocated to e-commerce marketing.
The division's operational structure has been streamlined and there will be
greater centralisation of back office functions.  We are today announcing two
new divisional director appointments and the rationalisation and relocation of
the office operations of Keycamp in the UK and Holland.

Relocation of Keycamp

The telesales and back office operations of Keycamp, currently situated in
Sutton, Surrey are being relocated to the Camping division head office in
Northwich.  There will be a similar consolidation in Holland where Keycamp's
Leiden office will be closed and operations moved to the Eurocamp office in
Amersfoort.  Keycamp's Irish office, in Cork, will be unaffected and the Keycamp
brand across Europe will maintain its strong and unique identity with customers
and agents.

These closures will, we anticipate, result in approximately ninety redundancies
with some   forty new positions being created in Northwich.  New positions and
relocation packages are being offered to a number of staff.   We anticipate that
the reorganisation process will be completed by early November 2004.  Annualised
overhead cost savings are expected to amount to approximately £1m. In addition,
Keycamp's freehold office premises will be sold and are expected to realise
their balance sheet value of approximately £1m.


Management

Deborah Beckett and Robin Parry will join Holidaybreak and the Camping division
board on 13 September 2004.

Deborah Beckett will be responsible for Eurocamp's pan-European marketing and
sales together with back office operations in the UK, Holland, Germany,
Switzerland, Austria and Denmark.  She joins Holidaybreak from a senior
marketing position with Cendant Corporation (Europe) having previously worked at
MyTravel Group plc, where she was responsible for the EuroSites brand in the UK.

Robin Parry will be responsible for direct and agency sales and marketing for
the Keycamp brand in the UK, Holland, Denmark and Ireland together with
self-catering specialist Perfect Places and new brands that will be launched in
Autumn 2004, primarily through e-commerce marketing channels.  Robin joins from
MyTravel Group plc where he was marketing director for Airtours Holidays and
Going Places and, prior to that, marketing director of Direct Holidays.

Robin and Deborah's broadly based tour operating experience and expertise in
direct and retail channel marketing will significantly strengthen the Camping
division's senior management team. Both positions will be based at the Camping
division head office in Northwich, Cheshire.


Exceptional Costs and Goodwill Impairment

The Camping division is likely to incur exceptional costs of up to £2.5m, in the
year to 30 September 2004.  The main component will be costs relating to the
Keycamp reorganisation, described above, of approximately £1.5m.

In addition, the Board is currently reviewing the carrying value of goodwill
arising from the acquisition of EuroSites and it is likely that a partial
impairment charge will be taken in the current year's results, which are
expected to be announced on 2 December 2004.  As at the date of the last balance
sheet (31 March 2004), there was £42.9m of goodwill included as an intangible
asset and being amortised over 20 years.  Of this balance, £14.9m relates to the
EuroSites acquisition.


Outlook

Holidaybreak has three strong and resilient businesses within its portfolio.
All are very profitable and a market leader in their sector.  Margins are good
and cash generation remains strong.  Our Hotel Breaks division is well
positioned to continue its excellent progress, the Adventure division leads the
way in an increasingly popular niche area and action has been taken to address
certain issues faced by Camping. The Group's early booking indications for 2005
are positive.  We view the future with confidence.




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