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Business Post Group (UKM)

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Friday 27 January, 2006

Business Post Group

Trading Statement

Business Post Group PLC
27 January 2006

                            BUSINESS POST GROUP PLC

                               Trading Statement

Since the Interim Announcement of 14 November 2005, the Board's expectations of
margin improvements in the Group's Parcel Services business, resulting from
improved selling prices and lower costs, have not been achieved.

On 5 December 2005, Guy Buswell was appointed Chief Executive. He has made a
number of significant changes to the management team designed to simplify and
streamline the management of the Group's activities and provide greater focus to
those areas requiring margin improvement. A strategic root and branch approach
is now being adopted to the development of the business focusing on customer
mix, service and cost control. These changes have already yielded an improvement
in the quality of service provided to customers.

As part of his assessment of the business as its new Chief Executive, Guy has
concluded a review of the franchise network and identified that further one-off
investment of £1.5m is required in order to secure its long term future.
Accordingly, it is anticipated that the additional costs relating to the
franchise network will be around £4.5m in the current financial year.
Consequently, the Board now expects profit before tax and exceptional items for
the year to 31 March 2006 to be approximately £9m. Exceptional items are
expected to total £4.2m, comprising a provision of £3.2m against amounts owed by
certain franchises relating to prior years, as previously disclosed, and costs
of £1.0m for management changes.

Trading in Specialist Distribution Services remains satisfactory. UK Mail
continues to trade ahead of the Board's expectations. Service quality remains
high and the Group continues to attract significant levels of new business. The
Group has a strong balance sheet and is well placed to fund further investment,
in particular for UK Mail.

Notes for Editors:

Business Post comprises Parcel Services (Express, HomeServe and International),
Specialist Distribution Services (UK Pallets and Courier) and Mail Services (UK


Business Post Group plc                             on 27 Jan: 020-7012 2000
Guy Buswell (Chief Executive)                                  0121-335 1111
Peter Fitzwilliam (Finance Director)                           01753-706 070
Bankside Consultants Limited                                    020-7367 8851/
Charles Ponsonby                                                07789-202 312

Conference call:

Guy Buswell and Peter Fitzwilliam will conduct a conference call for analysts
and investors at 09.00 today, Friday 27 January 2006, which can be accessed by
dialling 020-7162 0025 and quoting Business Post. The call will be recorded and
available for seven days on 020-7031 4064 via pass code 692075.

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