1 education, leisure and activity travel group education, leisure and activity travel group

1 education, leisure and activity travel groupeducation, leisure and activity travel group


INTRODUCTION

• Results and current trading in line with management expectations

• Group traditionally reports an operating loss in H1 (seasonal nature of Education and Camping)

• Reduced net debt in half year for the first time

• Stricter cost control and cash management procedures

• Half year dividend payment of 3.2p per share same as 2009



GROUP RESULTS

• Revenue -2.0% to £150.2m (2009: £153.2m)

• Operating loss 1 £11.0m (2009: £11.2m)

• Loss before tax 1,2 £17.7m (2009: £18.1m)

• Loss per share 1,2,3 19.1pps (2009: 27.4pps)

• Interim dividend 3 3.20pps (2009: 3.20pps)

• Net debt £129.2m (2009: £179.7m)

1 Before amortisation of other intangible assets acquired via business combinations of £0.9m (2009: £1.7m), exceptional restructuring costs of £nil (2009: £0.2m), impairment of goodwill of £nil (2009: £9.6m) and, for loss per share, the tax effect thereof of £0.2m (2009: £0.6m)2 Before IAS 39 mark-to-market revaluations of financial derivatives of £1.4m (2009: £7.0m) and, for loss per share, the tax effect thereof of £0.5m (2009: £2.1m).3 2009 Restated for the Rights Issue


DIVISIONAL RESULTS

Education Hotel Adventure Camping Group

Breaks

£m £m £m £m £m

Revenue 2010 44.0 65.1 40.9 0.2 150.2

2009 44.1 64.5 44.3 0.3 153.2

Operating (loss) profit* 2010 (2.5) 4.5 (0.6) (12.4) (11.0)

2009 (2.6) 5.6 (0.8) (13.4) (11.2)

*Before amortisation of other intangible assets acquired via business combinations of £0.9m (2009: £1.7m), exceptional restructuring costs of £nil (2009: £0.2m) and impairment of goodwill of £nil (2009: £9.6m)


MOVEMENT IN NET DEBT

2010 2009£m £m

EBITDA (7.6) (18.0)Impairment of goodwill - 9.6Share based payments charge 0.3 0.1Working capital movement 23.3 5.8Operating cash flow 16.0 (2.5)Net capex (3.3) (1.7)Tax refunded (paid) 0.5 (1.8)Interest (5.1) (5.0)Free cash flow 8.1 (11.0)Currency and non-cash movements 2.3 (6.1)Acquisitions and intangibles (1.5) (1.3)Decrease (increase) in net debt 8.9 (18.4)


• Net debt at 31 March was £129.2m (2009: £179.7m)

• Reduction in net debt in first half of the year for the first time

• Margin on bank borrowings reduced from 325bps to 300bps (w.e.f. 4 May 2010)

• At 31 March we are approaching peak facility utilisation- Net debt is now reducing as normal

NET DEBT & FACILITY UTILISATION


BALANCE SHEET

2010 2009*£m £m

Intangibles 166.7 169.1Property plant & equipment 200.3 188.4Non-current assets 367.0 357.5Cash and cash equivalents 51.2 46.9Net current liabilities (125.9) (112.3)Short-term borrowings (4.7) (6.1)Long-term debt (175.7) (220.5)Other long-term liabilities & provisions (31.9) (32.8)Net Assets 80.0 32.7

*Restated for the adoption of amendments to IAS 38 ‘Intangible assets’ of £0.1m and IFRS 2 ‘Share based payments’ of £nil.


• 15% of Bank debt is at floating interest rates

• Effective average interest rate c.8.1% at revised margin and bank rate at 13 May 2010

• 26% of Group EBITA in € zone

• Other net exposure- c. €46m- c. $19m

• 95% of Group’s € and $ requirements for 2010 bought at average rates of €1.14 and $1.63

INTEREST & CURRENCY HEDGES


• Restructuring programme in 2009 will result in annualised overhead savings of £2.5m

• Camping mobile-home net capital expenditure (£6.6m) below depreciation (£7.5m), 450 new units• Deferred payment terms

• Refund of corporate tax paid

• Interim dividend maintained at same level as last year

COST CONTROL & CASH GENERATION


• Revenue -2.0%

• Headline operating loss -1.8%

• Net debt reduced by £8.9m to £129.2m• Borrowing margin reduced to 300bps• Sufficient financial headroom to enable investment in

education businesses

• Forex exposure for current year substantially covered at favourable rates• not yet for 2011

FINANCIAL SUMMARY



• Appointment of CEO

• Performing in line with management expectations

• Excellent cash performance

• Volcano will not have material impact on Group results

OPERATIONAL SUMMARY


• Sales intake level yoy

• 93% booked overall; PGL centres at 98%

• Division is 30% booked for 2011; PGLcentres at 44%

• Potential at Liddington to reach up to 1,400beds

• Capital expenditure anticipated to be £7.2m

EDUCATION


• Sales intake -3% yoy

• Attractive package deals: declining hotel rates; attractive rail fares and availability of popular theatre shows

• No of UK packages up but average transaction value down

• European City breaks businessremains weak

• Further cost rationalisation

HOTEL BREAKS


• Sales intake +2% yoy

• Significantly improved tour offering

• £1m annualised cost savingprogramme

• Volcanic eruption could impactfull year profits by up to £0.8m

ADVENTURE TRAVEL


• Sales intake +2% yoy, versus -8% capacity

• 82% booked for the full season; high season booking well, marketing focused on low season

• Priorities are yield and occupancymanagement across various salesmarkets

• Capital expenditure is expected tobe £8.1m

CAMPING


SUMMARY

• Group sales level yoy

• Currently 78% booked for this year, 9% next year

• Encouraged by recent trading

• Remain strongly focused on cash generation and cost control

• Continue to look at investment opportunities in educationbusinesses


APPENDICESAPPENDICES


• £255m Five year facility committed to 2013 - £30m Term Loan- £225m RCF, Bonding and Ancillary Facility- £29.1m in CAA, ABTA bonds

• Current Margin LIBOR + 300bps (2009: 325bps)- margin ratchet at lower levels of debt

• Costs c.£3.6m at 31 March- Annual amortisation cost of £1.2m

BANKING FACILITIES


• Put in place 2007-2008

• 15% of bank debt is floating

• Effective average interest rate is 8.1% at revised margin and bank base rate at 13 May 2010

• IAS Valuation at 31 March was -£10.5m

Amount Product Fixed Cap Kick-in EndRate Rate Rate Date

€50.0m 5 yr collar 4.50% 3.00% 15/01/2012

£40.4m 5 yr collar 6.50% 6.17% 30/09/2012

£10.0m 5 yr swap 3.98% 21/10/2013

£40.0m 5 yr swap 4.355% 17/10/2013

INTEREST HEDGES


• 26% of Group EBITA in € zone

• Other net exposure v sterling- c.€46m- c.$19m

• 95.6% of Group’s € requirement for 2010 bought at average rate of €1.14

• 95.0% of Group’s $ requirement for 2010 bought at average rate of $1.63

• IAS valuation at 31 March was £0.2m

CURRENCY HEDGES


This presentation contains forward-looking statements with respect to the operations, performance and financial condition of Holidaybreak. By their nature, these statements are subject to risks, assumptions and uncertainties that could cause actual results to differ materially from those expressed or implied because they relate to future events.

Unless otherwise required by applicable law, regulation or accounting standard, we do not undertake to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise.

The financial information referenced in this presentation does not contain sufficient detail to allow a full understanding of the results of Holidaybreak. For more detailed information, please see the 2010 Interim Results Announcement which can be found on the Investor Relations section of the Holidaybreak website – www.holidaybreak.co.uk

DISCLAIMER

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