AIM Admission

Stagecoach Theatre Arts PLC 
14 December 2001


14th December 2001


                         STAGECOACH THEATRE ARTS PLC

      Placing and Offer raises £3.3 million for the Company and Founders

                                     and

                Admission to the Alternative Investment Market

                                     and

                            First Day of Dealings



Stagecoach Theatre Arts plc ('Stagecoach' or the 'Company'), which operates
the largest national network of part time performing arts schools for young
people, today announces the Placing and Offer Price and the bases of
allocations following the successful fundraising under the Placing and Offer.
Dealings on the Alternative Investment Market ('AIM') commence today.


Summary:


  * The Placing and Offer Price payable under the Placing and Offer is 93p
    per Ordinary Share


  * 2,688,172 Ordinary Shares, raising £1.8 million (net of expenses) for
    the Company at the Placing and Offer Price, are being issued by the
    Company under the Placing and Offer


  * 904,141 Ordinary Shares, raising £0.8 million at the Placing and Offer
    Price, are being sold on behalf of the Founders under the Placing and
    Offer


  * The total number of Ordinary Shares in issue is 9,688,172 Ordinary
    Shares


  * The market capitalisation of Stagecoach is approximately £9.0 million at
    the Placing and Offer Price


  * Following the Placing and Offer the Founders hold 5,995,400 Ordinary
    Shares, being approximately 61.9 % of the issued share capital of
    Stagecoach on Admission.


Commenting on the fundraising, Stephanie Manuel, Joint Chief Executive, said:


'We are delighted with the level of funds raised, which will enable us to
further develop the Stagecoach network both in the UK and internationally. The
Stagecoach business model has proved extremely successful and we believe that
the creative programme we offer young people provides them with a training for
life, which is invaluable in terms of building self-confidence at a young age.
We now look forward to continuing the growth of the business and developing
the potential of SportsCoach.'

We welcome institutional investors together with Parents and Franchisees as
shareholders in Stagecoach Theatre Arts plc.




Details of the Placing and Offer


The gross proceeds of the fundraising raised by the Company are £2.5 million.
Stagecoach has issued 2,688,172 new ordinary shares of 5p each at 93p per
share, valuing the Company at approximately £9.0 million at the Placing and
Offer Price. Applications under the Offer have been satisfied in full.


Following the Placing and Offer, the Founders hold approximately 61.9 % of the
Enlarged Issued Share Capital . Beeson Gregory is the nominated adviser and
broker to Stagecoach.


Defined terms used in this announcement have the meanings given to them in the
prospectus of Stagecoach Theatre Arts plc dated 23 November 2001, unless the
context dictates otherwise. A supplementary prospectus containing the Placing
and Offer Price and updated placing and offer statistics was published on 11
December 2001 ('Supplementary Prospectus').


Placing and Offer Statistics

Placing and Offer Price                                                     93p

Number of Ordinary Shares in issue following the Placing and Offer
('Enlarged Issued Share Capital')                                     9,688,172

Market capitalisation at the Placing and Offer Price                       £9.0
                                                                        million

Number of New Shares being issued pursuant to the Placing and Offer   2,688,172

Number of Sale Shares being sold as part of the Placing and Offer       904,141

Estimated net proceeds receivable by the Company after deduction of       £1.8
                                                                        million
estimated costs of flotation of £0.7m (including commissions and        
expenses)

Percentage of Enlarged Issued Share Capital subject to the Placing        37.1%
and Offer

Percentage of Enlarged Issued Share Capital held by the Founders
following the Placing and Offer                                           61.9%


Enquiries:
 
David Simonson/Nicola Davidson     Merlin Financial          020 7606 1244

Information on Stagecoach Theatre Arts plc

Introduction

Stagecoach operates the UK's largest network of part-time performing arts
schools for young people aged between 4 and 16. Since the opening of the first
three Stagecoach Schools by the Founders, Stephanie Manuel and David Sprigg,
in Surrey in 1988, the Stagecoach Group has grown, primarily by way of
franchising, to currently operate 355 Stagecoach Schools and 303 Early Stages
Classes in the UK offering part-time tuition in the three major performing
arts disciplines of dance, drama and singing. The Stagecoach Group has a track
record of sustained growth in turnover and profits and currently tutors over
20,000 students in the UK. The Directors estimate that in the year to 31 May
2001 the network generated annual tuition fees of approximately £10.4 million
and the Stagecoach Group achieved a pro forma profit before tax of £0.5
million.

History

Stephanie Manuel, an actress and writer, developed the idea of a national
network of part-time performing arts schools for young people aged between 6
and 16 years old, and together with David Sprigg, opened the first three
Stagecoach Schools in Surrey in April 1988. By 1993, the business had grown to
24 schools, with 12 under direct management and 12 in partnership with private
individuals. At this stage, following a review of the operations, it was
concluded that franchising was the best method to expand the business
nationwide. The first three franchised Stagecoach Schools opened in September
1994, and by December 1996, 81 franchised schools were in operation and the
Stagecoach Group now operates 352 franchised Stagecoach Schools in the UK,
with over 16,000 students. In its 13 year history, the Stagecoach Group has
not had a single franchise failure and currently, on average, 95 per cent. of
student places are filled across the network.

Having successfully established the Stagecoach Schools as performing arts
schools for the 6 to 16 year old age group, Early Stages was launched in 1997,
to provide an introduction to the performing arts to younger children,
typically aged between 4 and 7. This has also proved highly successful with
303 classes having now been established and in excess of 4,000 students in the
UK.

During its expansion, Stagecoach has received numerous prominent awards from
the business community, including: 'Newcomer of the Year' in the British
Franchisor of the Year Awards, in May 1996; finalist in the Small Business of
the Year Awards, sponsored by HSBC and the Small Business Bureau, in 1998; and
in 2000, the prestigious Sir Bernard Ingham Trophy in recognition of
Stagecoach's achievements in the British Franchisor of the Year Awards.

In 1995, Stagecoach expanded overseas via a franchised school in Dublin.
Further expansion followed in 1997 through a joint venture company in the USA.
Stagecoach Schools opened in Malta in 1998, a master franchise agreement for
Australia was granted in January 1999, and additional partnerships in Germany
and Spain were launched in April 1999. The Stagecoach Group now operates a
total of 31 Stagecoach Schools overseas.

In addition to the performing arts schools, the Company has recently launched
SportsCoach which specialises in the provision of part-time tuition of sports
to young people, typically aged between 6 and 16. The first pilot school
opened in April 2001 in Surrey and, following the initial encouraging
reaction, the second pilot school opened in September. These schools follow
Stagecoach's successful business model and SportsCoach's planned expansion in
the UK and ultimately overseas, primarily through franchising, is a
significant part of the Company's development strategy.

The Company also operates one of the UK's largest children's theatrical
agencies and a merchandising division selling branded clothes and accessories
to students. The Company also owns the young persons' performing arts magazine
called Theatre Mask which is published by Haymarket Publishing and runs a
Stagecoach Montessori nursery school for children aged between 21/2 and 4.

Since 1988, the majority of the Group's investment in the business has been
funded from its own cash flow and a small initial investment by the Founders.
Stagecoach's proven track record of successful reinvestment of profits has
provided the platform for its sustained growth, its ability to attract highly
motivated franchisees and their high quality teachers, and its development of
a strong management team.

The Market Opportunity

The number of Stagecoach Schools in the UK has grown dramatically since the
first three opened in 1988. However the Directors believe that substantial
territories in the UK exist which are not covered by an existing Franchise
Agreement. The table below demonstrates the current geographical coverage of
Stagecoach Schools in the UK.

Region                             Number of Stagecoach Schools

South East                       181     (including 3 partnerships)
North                             64
Midlands                          55
South West                        26
Wales                             19
Scotland                           8
Northern Ireland                   2
                                ----
                                 355
                           =========

Within these existing Franchises there is a significant variance in the number
of Stagecoach Schools operated by each Franchisee. Currently, although there
are 5 Franchisees with 5 Stagecoach Schools, there are over 100  Franchisees
with 2 or fewer Stagecoach Schools. The Directors believe that as the
operations of a Franchisee matures and the Stagecoach brand achieves greater
recognition there is the opportunity to increase the ratio of Stagecoach
Schools per Franchisee. In certain circumstances, the existing Franchisee may
be unwilling or unable to expand the number of Schools operating within the
defined Franchise territory. The Directors have identified a number of such
areas and intend to commence negotiations to buy-back a proportion of the
unutilised areas with a view to reselling additional Franchises. The initial
reaction from certain Franchisees to such proposals has been encouraging.

The Company's overseas operations have to date been purposefully restricted
prior to committing the resources necessary to operate on a significant scale
internationally. The Directors believe that the success of the existing
overseas operations demonstrates the opportunity for further expansion in
those countries. In addition, the Company believes that, globally, there are
over 30 countries where a Stagecoach School could be established, excluding
the countries where Stagecoach currently operates.

Key Strengths

The Directors believe that the following are the key strengths of the Company:


            *     UK market leadership with an established brand;

            *     a safe, structured environment with regular school
            inspections, validation of teaching practices and the provision by
            Franchisees of high quality tuition;

            *     a proven capability of successfully operating Franchises and
            securing and retaining Franchisees;

            *     a business model which the Directors believe is capable of
            replication in other disciplines and countries; and

            *     an experienced management team with a clear, well defined
            business strategy.

The Directors consider that the combination of these strengths will enable
Stagecoach to maximise the opportunities in its chosen markets.

The Business of the Group

Overview

The Company's core business has been focused on providing part time performing
arts tuition through a mixture of franchised, managed and partnership schools
trading under the Stagecoach brand. As this business has expanded, additional
operating divisions have been created to benefit from the brand and expertise
developed.

Group Operating Structure

Historically, the Stagecoach Group consisted of the Company, SPA and MASTS.
Immediately prior to the Reorganisation, SPA operated 39 Stagecoach Schools
under direct management and three Stagecoach Schools in partnership with third
parties. Prior to SPA's incorporation in 1990, the business was operated by
the Founders. MASTS owned the UK and relevant overseas trademarks in the
Stagecoach names and the Theatre Mask magazine. Immediately prior to
Admission, MASTS owned a 50 per cent. partnership interest in SportsCoach.
Stagecoach was incorporated in 1994 and is the principal trading company of
the Group and the company through which the franchised Stagecoach Schools
operate. Stagecoach also operates Stagecoach Montessori and the Stagecoach
Agency.

Reorganisation

The Reorganisation has involved transferring the operation of the 39
Stagecoach Schools under direct management from SPA to the Company, which has
entered into a Franchise Agreement with a third party in relation to the
ongoing operation of those schools. In addition, the Company has acquired the
UK and overseas trademarks, Theatre Mask and the 50 per cent. of SportsCoach
previously owned by MASTS, together with the 50 per cent. of SportsCoach
previously owned by its co-founder Jon Bennetts and his wife. Thus going
forward, the Stagecoach Group will almost exclusively operate franchised
Stagecoach Schools, with the exception of the three Stagecoach Schools
operated in partnership with third parties, and owns all of the relevant
trademarks and 100 per cent. of SportsCoach.

Performing Arts Schools

Stagecoach Schools

Each Stagecoach School runs as an individual business, consisting of
approximately 45 students, three part-time specialist teachers and a
principal, who is the Franchisee. The students enrol, and pay the Franchisee 
£250 in advance, for a complete term of tuition of 12 or 13 weeks.

The format for each Stagecoach School is identical and consists of three
one-hour sessions per week in each of dance, singing and drama. Students are
divided into three classes of 15, rotating between each of the disciplines
every hour. The Franchisee must be in attendance whenever a school is in
operation and is not permitted to teach. The Directors believe that this
ensures that the Franchisee focuses on supervising classes thus maintaining a
high level of quality under the Stagecoach brand, and most importantly
ensuring the safety of the children under their care. The schools
predominantly take place in existing educational premises at weekends, and
increasingly, after school. As an endorsement of the quality of teaching,
Stagecoach students are able to take grades in group musical theatre offered
by Trinity College (London), the international examining board.

Stagecoach Schools are currently running at on average 95 per cent. of their
student capacity, and 33 per cent. of schools have filled their classes in
their first term of operation. Stagecoach has not had a single Franchise
failure, nor do the Directors believe that any Franchisee has left the network
in order to compete with Stagecoach.

Early Stages Classes

Following the success of Stagecoach Schools, Early Stages was launched in 1997
to broaden the reach of the business to younger children aged between 4 and 7
years old. The format is similar to that of Stagecoach Schools except that it
revolves around three half hour classes of the performing arts with one group
of up to 15 children. An Early Stages Class can only be opened by an existing
Stagecoach Franchisee and there are currently 303 in operation in the UK. The
students enrol, and pay the Franchisee £125 in advance, for a complete term of
tuition of 12 or 13 weeks.

Franchise Operations

The majority of Stagecoach's business is generated through its Franchise
network. The Directors believe that one of the key strengths of the Company's
franchise operations is its rigid structure and the Directors' insistence on
conformity and discipline in its operations. The case study below illustrates
the evolution of a standard Franchise operation of a Stagecoach School and its
contribution to the Company.

Potential Franchisees will typically initiate contact with Stagecoach to
request an information pack, which contains a comprehensive application form,
thereby avoiding direct recruitment costs. Potential Franchisees have in the
past relocated from areas covered by an existing Franchise Agreement to a new
area in order to become a Stagecoach Franchisee. The Directors insist that
potential Franchisees have applicable experience in the performing arts or
teaching.

Stagecoach will only invite the potential Franchisee to enter into a Franchise
Agreement once it has received satisfactory clearances in relation to the
applicant from Government agencies responsible for checking people's
suitability to work with children.

The new Franchisees attend a week's training course at Stagecoach's head
office where they are supplied with Stagecoach's Pre-Opening, Operating, Child
Protection and Marketing Manuals, together with the Company-developed software
to assist them in the management of their Franchise. The Company helps with,
amongst other things, introducing potential funding to new Franchisees,
assisting with the opening of a school, helping with the sourcing of a
suitable venue and staff, covering sick-leave and organising regional training
days for teachers and Franchisees. Stagecoach does not dictate the content of
classes but aims to provide a controlled and monitored environment with
guidelines and a library of teaching material if required.

In order to maintain awareness of the Stagecoach brand and assist Franchisees
with their occupancy targets, Stagecoach sets out the required spend on
promotion. Franchisees are required to spend up to £750 per school per term on
advertising in addition to contributing 2.5 per cent. of their turnover
towards head office promotion of the Stagecoach brand. The Directors believe
that this allows Franchisees to benefit from the advantages of pooled
resources as well as ensuring that the Stagecoach name is synonymous at the
local level with part time performing arts classes.

SportsCoach

The Directors, in partnership with Jon Bennetts have developed a strategy to
extend the Stagecoach teaching format to include part-time sports tuition
under the SportsCoach name. The Group launched its pilot SportsCoach school in
April 2001 after entering into a 50:50 partnership with Jon Bennetts to
operate the division. With effect from Admission, the Company purchased the 50
per cent. of the partnership not already owned by the Stagecoach Group and Jon
Bennetts was appointed managing director of SportsCoach. The concept and
format of the schools will be similar to the performing arts schools and will
offer tuition for 3 hours per week in a wide range of different sports.

The number of students attending the pilot SportsCoach school exceeded
breakeven on its first day of operation and it is now trading at 87 per cent.
of its capacity, mirroring the initial development of Stagecoach Schools. The
Directors believe that the key indicator of the potential success of
SportsCoach is the number of children who return for a second term of tuition.
In the pilot SportsCoach school, of the 29 students who initially enrolled, 27
re-enrolled for a second term in September 2001. A second pilot SportsCoach
school opened in September 2001 with a further 20 students.

The Directors believe that the demand for SportsCoach and the rate of growth
in school numbers could eventually outstrip that of Stagecoach. The Directors
believe that SportsCoach can provide a recreational, learning and disciplined
environment for children to develop not only their sporting skills, but also
their self-confidence and interpersonal skills.

Other Operations

In addition to its educational operations, Stagecoach operates a division that
manages four other revenue generating businesses:

Merchandising

Stagecoach has created a unique identity and brand which the Directors have
used to sell associated merchandise such as clothing, shoes and other
accessories to its students via the franchise network.

As the number of SportsCoach schools increases, the Directors intend to sell
the clothing and accessories associated with the sports being taught.

Theatrical Agency

The Stagecoach Agency was launched in 1988 and is now one of the largest
children's theatrical agencies in the country, helping to raise the public
profile of Stagecoach and strengthen its brand. The ability of Stagecoach
students to obtain assignments through the agency often generates substantial
local publicity.

Publishing

Stagecoach has inspired a national magazine, 'Theatre Mask', a leading
magazine for young performers, which is owned by the Company and is published
by Haymarket Publishing six times a year. Franchisees in the UK are required
to purchase Theatre Mask for all their students and in addition there are a
small number of independent subscribers.

Montessori

Stagecoach Montessori is a single school that operates from the Company's head
office and tutors 21/2 to 4 year old children under the education methods
devised by Italian behavioural psychologist Maria Montessori. While the
Directors have no current plans to open further Montessori schools, they will
consider expansion if suitable opportunities arise.

Overseas

The Company's operations have to date been mainly focused on the UK market.
The Directors believe that a significant opportunity exists to replicate and
further expand all the Company's operations overseas. The Stagecoach Group
currently has 31 Stagecoach Schools overseas, operated either as Franchises or
partnerships with similar merchandising operations to those carried out in the
UK.

Operational Information

The table below shows the historical growth of the Stagecoach Group in the UK
with respect to the number of Stagecoach Schools and Early Stages Classes and
their approximate student numbers together with the resulting underlying
Franchise school fees.
                                          As at/and for the year to 31 May

                                            1999           2000           2001
Stagecoach Schools students               10,300         12,400         14,600
Stagecoach Schools                           228            286            326
Early Stages students                      1,700          2,400          4,000
Early Stages Classes                         128            179            294
Total number of students                  12,000         14,800         18,600
Underlying Franchise school fees           £5.9m          £7.5m         £10.4m

Sources of Revenue


The Company derives the majority of its revenues from the fees payable by its
Franchisees. Tuition fees for a Stagecoach School are £250 per term per
student and £125 per term per student for Early Stages which are payable at
the start of term to the Franchisee. Under the Franchise Agreement, Stagecoach
receives 15 per cent. of the gross tuition fees paid to the Franchisee, which
is payable to Stagecoach six weeks after term commences. Of the 15 per cent.,
2.5 per cent. is reserved specifically for head office promotion of the
Stagecoach brand and network. In addition, £10,500 is payable upon the
purchase of an initial Franchise in the UK together with a further £5,000 on
the opening of additional Stagecoach Schools and £3,000 for the opening of
Early Stages Classes under an existing Franchise Agreement.

Competition

The Directors believe that Stagecoach faces direct competition from operators
that have mirrored the format of combining the three disciplines of the
performing arts in one part-time school. The Directors are aware of three
companies operating in the UK with a significant number of schools, namely
Theatretrain, MAD and Theatre Express, in addition to a number of smaller/
owner operated schools. The Directors believe that these three organisations
have approximately 100 schools between them compared to the 355 schools
currently operating under the Stagecoach brand in the UK.

In addition to direct competition there are schools focusing on only one
element of the performing arts. Most relevant to Stagecoach is the Helen
O'Grady Drama Academy, an Australian franchising company offering classes of
one hour a week in drama only. It commenced franchising in the UK in 1994 and
currently operates from approximately 34 centres. Furthermore, there are a
number of owner operated dance schools.

The average occupancy rate of Stagecoach Schools of 95 per cent., the high
level of re-enrolment amongst students and the fact that to date no Franchise
has failed, leads the Directors to believe that Stagecoach is both popular
amongst parents and students and is well positioned amongst its competitors.

Corporate Strategy and Future Developments

Stagecoach has established itself as the market leader in the provision of
part time tuition in the performing arts in the UK. Its strong brand and
business model has led to rapid growth in school and student numbers
throughout the UK. The Directors have established a strategy to:


            *     continue the expansion of Stagecoach in the UK;

            *     develop SportsCoach in the UK;

            *     expand Stagecoach and SportsCoach overseas; and

            *     expand merchandising and publishing.

Stagecoach expansion in the UK

Stagecoach currently has 355 schools in the UK, operating primarily through
Franchises. Sustained demand for additional Stagecoach Schools, supported by
the Directors' analysis of the market place, indicates that there is a
significant potential for more schools. The Directors intend to continue to
allocate territories within the UK in areas which are not yet covered by
existing Franchise Agreements, and in some areas where existing Franchise
Agreements are in place, seek to redefine them with a view to increasing the
number of Franchises.

The Directors have identified a number of existing Franchisees who, due to
personal circumstances, are unable or unwilling to open further schools within
their territory, despite strong demand for additional schools. The Company
intends to enter into discussions to buy back part of those territories thus
creating additional territories that can be sold to prospective Franchisees.

Based on historical performance, the Directors expect the number of additional
Sunday and weekday evening schools to increase as Franchisees grow the number
of schools per franchise.

SportsCoach

With effect from Admission, the Company purchased for £100,000 the 50 per
cent. of the partnership not already owned by the Stagecoach Group that
currently operates the two pilot SportsCoach schools and related services. Jon
Bennetts, the co-founder has joined the Company as managing director of
SportsCoach with responsibility for the expansion of SportsCoach in the UK and
overseas. The Directors believe that the expansion of SportsCoach can
replicate Stagecoach's high level of growth due to the similarity of the
business models. The Company has received a number of expressions of interest
in operating SportsCoach Franchises from existing Stagecoach Franchisees and
their partners, amongst others. Prior to opening the first Franchised
SportsCoach school, the Company intends opening two managed schools in order
to more closely gauge the potential appetite for SportsCoach and further
refine the business model. The Directors anticipate that the first SportsCoach
Franchise should begin operations in 2003.

Expansion of Stagecoach Schools and SportsCoach overseas

Having already established profitable Stagecoach Schools outside the UK, the
Directors intend to expand Stagecoach progressively overseas primarily through
Franchise operations. The operations in the USA and Germany were purposefully
restricted to small areas in order to test their viability prior to commencing
broader international development. The Directors have estimated that there are
potentially over 30 countries worldwide where Stagecoach Schools could be
established, excluding expansion in the 6 countries with existing schools. The
Directors currently anticipate additional Stagecoach Schools opening overseas
in September 2003.

The Directors anticipate that SportsCoach will expand overseas if the
franchising of SportsCoach proves successful in the UK.

Merchandising and Publishing

The Directors believe that the expansion of merchandising and publishing will
reflect the growth of the Company's core businesses of Stagecoach Schools and
in time SportsCoach. As the business expands, the Directors believe that these
activities can benefit significantly from economies of scale and in the case
of merchandising, continued product diversification.


Directors

Graham Cole ACA, MSI, aged 55, Non-executive Chairman

Graham qualified as a chartered accountant with Blackburn Robson Coates.
Having moved to Deloitte Haskins & Sells in 1971, he became a partner in 1979,
was a founder partner of the firm's corporate finance division and became the
firm's national and European flotation partner. He continued this role
following their merger with Coopers & Lybrand and was involved in the creation
of the Alternative Investment Market following the demise of the Unlisted
Securities Market. In 1995 Graham joined Beeson Gregory as a director where he
advises domestic and international companies, both public and private, on
their strategies for growth and capital raising. Graham is a co-founder and
past executive member of the Quoted Companies Alliance, formerly known as
CISCO, and a non-executive director of Northamber PLC and Claims People plc.

Stephanie Manuel FRSA LLAM, aged 57, Joint Chief Executive

Prior to founding Stagecoach with David Sprigg in 1988, Stephanie was an
actress, writer and drama teacher, and drama advisor to Elmbridge and Epsom
Borough Councils. Stephanie developed the idea of a national network of
performing arts schools for young people following her own experience in
bringing up her son. She identified a gap in the market for quality tuition in
the performing arts -- dance, drama and singing. Stephanie has primarily been
responsible for establishing the Stagecoach brand and setting the ethos and
the high standards of tuition, a hallmark of all Stagecoach schools. Stephanie
will focus on improving the artistic and educational programme, further
developing the Stagecoach and SportsCoach brands and identifying new business
opportunities.

David Sprigg FRSA ACIB, aged 44, Joint Chief Executive

David co-founded Stagecoach in 1988 with Stephanie Manuel. He previously
gained extensive experience working with SMEs and in international trade
through his work for Barclays Bank, which he joined in 1975. In the three
years immediately prior to founding Stagecoach, David was a lending manager
for Barclays. David has primarily been responsible for establishing the
systems and procedures of Stagecoach and managing the Franchise operations.
David will be primarily responsible for the development of the Stagecoach and
SportsCoach business in the UK and have overall responsibility for expansion
overseas.

Richard Dawson ACA, aged 32, Finance Director

Richard qualified as a Chartered Accountant with KPMG in 1995. He then moved
to British Linen Bank, the merchant banking subsidiary of Bank of Scotland
Plc, where he was a corporate finance manager, specialising in advising SMEs,
including company acquisitions, raising venture capital and flotations. In
August 1999, Richard joined Thomson Intermedia plc as finance director, having
provided general business advice to the company since its incorporation in
1997. Richard was a co-founder of free2look.co.uk, a division of Thomson
Intermedia, and he was responsible for managing the flotation of Thomson
Intermedia plc onto the Alternative Investment Market in May 2000. Richard
joined Stagecoach in October 2001 and is responsible for all financial aspects
of the Group's business, as well as assisting in its strategic planning.

Julian Paul FCA, aged 56, Non-executive Director

Julian is executive deputy chairman and a founder shareholder of Eagle Rock
Entertainment plc, which acquires and exploits audio and visual entertainment
rights on a global basis. Since 1991, he has held several positions in the
film TV and video industries (in a consultant, executive and non-executive
capacity). Previously he spent twenty years in banking, including the position
of managing director of Guinness Mahon & Co Limited responsible for corporate
banking and corporate finance. He qualified as a chartered accountant with
Arthur Andersen. Julian is currently also non-executive chairman of Argonaut
Games plc and a non-executive director of Entertainment Rights plc.

Dividend Policy

The Directors' intention is for the Company not to pay any further dividends
other than those already declared in respect of the year to 31 May 2002.
However, the Directors do intend that the Company will declare and pay
dividends thereafter and the amount thereof will depend upon the Company's
financial results and condition, its cash requirements, future prospects,
profits legally available for distribution and other factors deemed by the
Directors to be relevant at the time.

Financial Information

The Stagecoach Group has not produced consolidated accounts. The following pro
  forma profit and loss account estimates have been prepared by the Directors
for illustrative purposes only to reflect how the Reorganisation would have
impacted on the financial results of the Stagecoach Group had the
Reorganisation been effected throughout the three years to 31 May 2001. The
estimates have been prepared to reflect the transfer, pursuant to the
Reorganisation, of the 39 Stagecoach Schools previously managed by the
Stagecoach Group into Frachised schools with related adjustments to turnover,
gross profit and net administration costs in each of the three years. No
account has been taken of amortisation of the goodwill arising on the
Reorganisation.

It is emphasised that the estimated results set out below do not relate to a
statutory reporting entity but show the estimated results of the Stagecoach
Group for the three years ended 31 May 2001 drawn up on a combined basis:

                                           Year ended   Year ended   Year ended
                                          31 May 1999  31 May 2000  31 May 2001
                                                 £000         £000         £000

Turnover                                        1,840        2,407        3,191
Gross profit                                    1,160        1,591        1,975
Operating profit                                  112          227          533
Profit on ordinary activities before tax           89          202          514

Based on the estimated results above, the Stagecoach Group has increased
turnover and profits for the three years to 31 May 2001, reflecting the growth
in the number of schools, students and school fees of the Franchise network.
Turnover is primarily derived from annual Franchise management fees of 12.5
per cent. of the network school fees payable by the Franchisees.

Pro forma turnover has increased by 31 per cent. and 33 per cent. for the
years to 31 May 2000 and 31 May 2001 from their previous years, respectively,
whilst pro forma operating profit has increased by 103 per cent. and 135 per
cent. over the same periods respectively. The greater increase in pro forma
operating profit primarily reflects the additional marginal contribution to
operating profit from each new school opened. In addition, the occupancy
levels of schools have increased over the three years to 31 May 2001, and are
now running at over 95 per cent.

Immediately prior to Admission, the Company paid an interim dividend of £
750,000 to the Founders. This reflects historical profits retained in the
Company.

Reasons for the Flotation and Use of Proceeds

Stagecoach has already established itself as a profitable business and the
operator of the largest network of part time performing arts schools in the
UK. The net proceeds of the Placing and Offer will enable the Company to
strengthen this position by continuing the expansion of Stagecoach Schools in
the UK, develop the concept of SportsCoach and expand its operations overseas.

In summary, the Company intends to apply the net proceeds of the Placing and
Offer as follows:


            *     to continue the expansion of Stagecoach Schools in the UK;

            *     to acquire the remaining 50 per cent. of, and formally
                  launch, SportsCoach;

            *     to expand Stagecoach and SportsCoach overseas;

            *     to raise the profile of the Company and of the Stagecoach
                  and SportsCoach brand; and

            *     to provide additional working capital for the Company.


This press announcement, which has been issued by Stagecoach Theatre Arts plc,
has been approved for the purposes of section 21 of the Financial Services and
Markets Act 2000 by Beeson Gregory Limited which is regulated in the United
Kingdom by the Financial Services Authority .


Beeson Gregory Limited is acting exclusively for the Company and no one else
in connection with the Placing and Offer. Beeson Gregory Limited will not
regard any other person as its customer and will not be responsible to anyone
other than the Company for providing the protections afforded to its customers
or for providing advice in relation to the Placing and Offer.


No offer or invitation to acquire shares in Stagecoach Theatre Arts plc is
being made by or in connection with this announcement. Any such offer will be
made solely by means of the Prospectus and the Supplementary Prospectus and
any decision to keep, buy or sell shares should be made solely on the
information contained in those documents.


This announcement and the information contained herein is not an offer of
securities for sale or a solicitation of an offer to purchase securities in
the United States, Australia, Canada, Republic of Ireland or Japan. The
Ordinary Shares have not and will not be registered under the US Securities
Act of 1933, as amended (the 'Securities Act'), or with any securities
regulatory authority of any state or other jurisdiction in the United States,
or under any applicable securities laws of Australia, Canada, Republic of
Ireland or Japan. The Ordinary Shares may not be offered, sold or delivered,
directly or indirectly, within the United States or to US persons (as defined
in Regulation S) or within Australia, Canada, Republic of Ireland or Japan.


There is no offer for, or the solicitation of an offer to subscribe for or buy
any of the Ordinary Shares to any person in any jurisdiction in which such
offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities law of such jurisdiction. No money,
securities or other consideration is being solicited by this announcement or
the information contained herein and, if sent in response to this announcement
or the information contained herein, will not be accepted