Annual Report and Accounts 2001

200

180

170

160

150

140

130

120

110

100

Turnover

142.4

164.5

192.5

113.5

106.4

9 7 9 8 9 9 0 0 01

£ m

26

24

22

20

18

16

14

12

10

8

*Profit before tax

17.3

20.7

23.8

14.0

11.2

9 7 9 8 9 9 0 0 01

£ m

18

16

14

12

10

8

6

4

2

Dividends per ordinary share

14.0

16.0

18.0

12.5

11.5

9 7 9 8 9 9 0 0 01

p e n c e40

35

30

25

20

15

10

5

0

Earnings per ordinary share

29.3

34.0

38.1

26.8

21.6

9 7 9 8 9 9 0 0 01

p e n c e

Holidaybreak is the UK’s leading operator of specialist holiday businesses. Group companies retain a distinctive

identity whilst sharing expertise and exploiting opportunities in areas of common interest.

Our aim is to achieve continuing profitable growth by developing our existing businesses and market leading

brands in the UK and European holiday markets and through acquisitions within the travel sector.

Page1

Financial Highlight s■ Record sales of £192.5m (2000:£164.5m)

■ Record profits before tax of £23.8m* (2000 : £20.7m)

■ Record earnings per share of 38.1p*,up 12% on

2000 (34.0p)

■ Increase in annual dividend for fifth successive year

to 18.0p (2000:16.0p)

■ Interest cover increased to 8.6 times (2000 : 7.7)

■ Profits impact of 11th September estimated at

£160,000

■ £39.7m cash flow from operating activities

■ Net debt significantly reduced to £25.1m (200 0 :

£32.2m)

*Before goodwill amortisation and exceptional operating costs

Our Year in Summary■ All businesses performed well in 2001

■ Significant increase in shareholder value

■ Outstanding year for Hotel Breaks

■ Consistent performance by Camping

■ Pleasing progress from Adventure Division in first

full year in the Group

■ September 11th aftermath only likely to affect

Adventure Holidays

Contents

Chairman’s Statement 2

Chief Executive’s Review 4

Finance Director’s Review 6

Camping Division 8

Hotel Breaks 10

Adventure Holidays 12

Directors’ Report 14

Investor Relations 15

Directors and Advisors 16

Corporate Governance 18

Internal Control 19

Other Information 20

Remuneration Committee Report 22

Share Option Schemes 23

Report by the Auditors 24

Consolidated Profit & Loss Account 25

Balance Sheets 26

Consolidated Cashflow Statement 27

Statement of Accounting Policies 28

Notes to the Accounts 29

Notice of Annual General Meeting 43

Holiday Brochure Requests 45

Holidaybreak has enjoyed another year of substantial progress in 2001. For the fifthsuccessive year, we are reporting record profits and are recommending a commensurateincrease in the annual dividend. In the year to 30 September 2001, profits before goodwillamortisation, exceptional costs and tax rose by 15% to £23.8m on turnover of £192.5m(2000: £164.5m). Headline earnings per share rose from 34.0p to 38.1p and we areproposing to increase the annual dividend to 18.0p (2000: 16.0p).

Camping Division operating profits increased once

again as did bookings and margins. The margin

improvement was largely due to a continuation of

the trend away from tented accommodation to

mobile-homes but also the success of our marketing

campaign in the all-impor tant UK market which,

together with various product improvements, will also

have long term benefits.

Despite the potentially negative effects of foot and

mouth and rail disruption, Hotel Breaks profits grew

by 25% in line with turnover. Superbreak, our

principal brand, is increasingly broadening its

distribution and gaining recognition from consumers,

not least because of the success of our on-line

booking facility which now accounts for more than

10% of total revenues.

Explore Worldwide and Regal have bedded in well in

their first full year as part of the Holidaybreak Group.

Simon Tobin, formerly managing director of Keycamp,

replaced Explore Worldwide founder Travers Cox as

divisional managing director in January and has

instigated a series of measures to improve the

marketing and operation of the business. Like for like

turnover was 12% up on the equivalent 2000 figure.

We estimate that Adventure lost approximately

£300,000 of revenue as a result of the September

11th attacks, taking virtually no late bookings for

September holidays and also suffering numbers of

last minute cancellations. This, together with reduced

load factors on some of our tours, resulted in

operating profits being reduced by approximately

£130,000 compared to the previously anticipated

figure.

CURRENT TRADING AND PROSPECT S

Most travel businesses are experiencing more than

normal uncertainty in their trading outlook

following the events of September 11th. There is

also the prospect of a further economic downturn.

However, there are good reasons to believe that

consumers will not be deter red from taking their

normal holidays whether these be in the UK or

overseas, albeit cer tain destinations will suffer

badly and some customers will be reluctant to fly.

After the initial shock of the terrorist attacks,

demand for holidays from UK consumers has

recovered strongly although booking lead times

appear to have shortened and the market as a

whole is still well down. With the major air

package operators, who have been most affected by

recent events, announcing substantial capacity cuts

for summer 2002, it seems likely that pricing levels

will hold up.

In overall terms, because of the mix of our

businesses with relatively few flight based holidays,

Holidaybreak has every prospect of making further

progress, although this may well be at a reduced

rate compared to recent years. Only our Adventure

Division operations, Explore Worldwide and Regal,

which together represented 16% of turnover and

13% of profits in 2001, have direct exposure to the

effects of recent events.

There is a more detailed review of current trading

by our various divisions in the Chief Executive’s

Review which accompanies this statement but the

main points are summarised here.

Camping

Virtually all camping and mobile-home customers

travel by road rather than air to their holiday

destinations which are entirely in western and

southern Europe. Bookings in recent weeks have run

well ahead of last year and are currently level with

2001. We have now received nearly half of our

estimated final total for the year which is on track

with previous years. Another good year is in

prospect.

Hotel Breaks

We anticipate another year of strong profits growth

from Hotel Breaks. In the weeks following

September 11th demand for London breaks and

airport hotels fell away markedly, reducing 2001

profits by an estimated £30,000.

However, we were still achieving year on year

increases in overall terms and since mid-October we

have seen a strong rebound. Current growth rates

are on a par with those we experienced in 2001.

We recently launched a new European

‘accommodation only’ hotel breaks programme.

The early signs are encouraging.

Adventure Holidays

With Explore Worldwide and Regal directly affected

by the fallout from September 11th these

businesses will almost cer tainly suffer a set-back in

2002. Early booking trends for both businesses

were extremely encouraging and, despite the

disruption to normal holiday booking patterns, the

division will remain profitable and is well placed for

future growth. After the initial cancellations and

drop in bookings, a situation closer to normality is

returning and underlying demand is good.

However, there will be some load factor erosion for

a period before full profitability returns. Very much

the same observations apply to Regal albeit on a

rather smaller scale.

STRATEGY

Notwithstanding the current uncertain environment,

all our divisions enjoy attractive growth prospects.

Our priority is to exploit these. We have not allowed

recent events to deter us from new initiatives, most

notably Superbreak’ s European programme launch.

Whilst we have not made acquisitions over the past

year, we are active in this area and continue to seek

out suitable opportunities to add to our existing

businesses or to form a further stand-alone division.

EMPLOYEES

The enthusiasm, skills and commitment of the

Group’s 780 permanent employees in six countries,

are paramount to our success. Many, particularly

those in our Adventure Division, have been under

additional pressure in recent months and have

performed admirably in dif ficult circumstances.

I take this opportunity to thank all our employees

for their continuing vital contribution to the

Holidaybreak Group.

IN CONCLUSION

Holidaybreak has had another successful year in

2001 and achieved a significant increase in

shareholder value. We have resilient businesses

and expect the group to make further profitable

progress in 2002. Of our three divisions Camping

and Hotel Breaks appear unlikely to be significantly

affected by the events of September 11th whilst

Adventure continues to trade profitably and should,

reasonably soon, resume its previous high growth

rates. All our divisions, and the Holidaybreak Group

as a whole, have a bright future.

Angus Crichton-Miller

Chairman

Holidaybreak plc

Page 2

Sta tement by Angus Crich to n - M i l l e rC h a i rm a n

Sta tement by Angus Crich to n - M i l l e rC h a i rm a n

Page 3

Our Year

September 11th had only a smallimpact on 2001 profits and we areconfident that 2002 will prove theresilience of the Group’s business andresult in further progress being made.

DIVIDEND

The Board is recommending a final dividend of 12.6p

(2000: 11.2p), payable on 23 April 2002, to

shareholders on the register on 22 March 2002,

making a total of 18.0p (2000: 16.0p) for the year.

Dividend cover will be 2.1 times, in line with our

policy of maintaining approximately two times cover.

THE DIVISIONS

2001 proved to be a good year for our two main

Camping Division businesses, Eurocamp and

Keycamp, and an outstanding one for Hotel Breaks.

Our Adventure companies, Explore Worldwide and

Regal Diving, also made pleasing progress.

Relaxing outside a Eurocamp mobile home

As Angus Crichton-Miller has reported in his Chairman’s Statement, Holidaybreak has hadanother very good year, continuing its consistent record of "double-digit" earnings growth.The most obvious highlight has been the exciting progress made by our Hotel Breaksdivision. There are also good reasons to take considerable satisfaction from another verysolid performance from Camping as well as the progress made by the Adventure HolidaysDivision and the success of various investor relations initiatives which we have undertaken.

Whilst there have been and still aresome concerns following the events ofSeptember 11th , particularly in ourAdventure Division, we are confident inour ability to make further progress in2002 despite the changed tradingenvironment.

AN OUTSTANDING YEAR FOR HOTEL BREAKS

The success of our Hotel Breaks division whose

operating profits grew by 25% to £5.5m in 2001 is

all the more noteworthy in the light of the difficulties

that so much of the UK domestic sector has

experienced over the past year. A key growth driver

has been our internet booking facility which has

proved an outstanding success. The acquisition of

Rainbow Holidays in September 2000 also made a

useful contribution to our growth and enhanced

market share in the core high street travel agency

channel.

The Hotel Breaks Division continues to enjoy

excellent prospects. Immediately after September

11th there were some cancellations and sales did fall

away a little, mainly for London and airport hotels.

This effect straddled the two financial years and

reduced 2001 profits by an estimated £30,000.

Demand has now bounced back strongly and initial

signs for the newly launched European programme

are also encouraging.

UK MARKET STRONG FOR CAMPING

Our Camping Division enjoyed rather better market

conditions than in 2000 when the Brittany oil spill

affected demand for resorts on the west coast of

France. Mobile-homes are now the preferred

accommodation type for two in three of our UK

customers and are growing in popularity in all

markets. Tents retain a greater share of our Dutch,

German and Swiss business but overall ‘under

canvas’ bookings continue to decline.

We do not believe that any reluctance to travel on

the part of consumers will affect self-drive holidays

in Europe although the unusual market conditions

may delay some bookings. With nearly half of

anticipated final bookings now taken, Camping is

on course for another good performance

ADVENTURE HOLIDAYS RESILIENT

Overall in 2001 Adventure Division’s sales grew by

12% on a like for like basis. Even before September

11th we had experienced rather more than usual

disruption to our programme, mainly due to the

problems in Nepal and Sri Lanka but this was

counterbalanced by strong growth in Europe, South

America and some African destinations.

The initial indicators for 2002 were extremely

positive. Bookings for the first quarter of the year

were well ahead of 2001 equivalents, reflecting

increasing consumer demand for adventure travel

as well as the launch of Explore Worldwide’s new

internet site and the introduction of over 50 new

tour itineraries. Bookings for Regal’s autumn

holidays, a popular period for the diving market,

were also very strong.

The short-term effects of the New York attack

resulted in an estimated cost to the business of

approximately £300,000 in sales revenues and

£130,000 in operating profit as well as

considerable disruption. In recent weeks we have

taken increasing numbers of new bookings and are

close to normal levels of intake. We are still

operating tours to nearly all of the Islamic countries

in our programme (25% of sales in most years)

whilst giving customers who have already booked

the opportunity to switch to other tours or take a

credit against future travel if they prefer.

A strength of the Explore business is that there are

no fixed commitments to either airline seats or

ground costs. Whilst load factors suffered in

September, because of a high number of short-term

cancellations and tour transfers and there has been

some residue effect on October and November

departures, looking forward we expect to operate at

normal levels. We also anticipate strong demand for

our tours in Europe, South America and Africa from

the UK market but some weakness in overseas

agents who normally account for about 15% of

bookings.

Regal, which is a much smaller business than

Explore, also continues to see reasonable levels of

new bookings. The initial indications are that the

core diving market will prove very resilient but that

"cheap sunshine" customers who are an important

part of the mix in softer periods are likely to stay

away for the immediate future. We have taken steps

to reduce our air charter commitments which will

reduce the impact of any shortfall.

ACQUISITION ACTIVITY

As well as the major acquisition of Explore

Worldwide in February 2000, last year we also

acquired Regal, Hotelnet and Rainbow. Since then

we have been active in examining various

opportunities which, for one reason or another, did

not come to fruition. Whilst this is to a degree

disappointing, it does reflect the degree of caution

we exercise in assessing potential additions to the

Group.

INVESTOR RELATIONS

We have increasingly felt that we needed to

improve our communication of the qualities and

prospects of the Holidaybreak business to both

institutional and private investors. Whilst we have

always been fairly active in our investor relations

efforts, we put more ef fort and resources into this

area in 2001 with encouraging results. There is,

however, no substitute for consistent performance

and exploitation of opportunities for growth and

these, together with enhancement of shareholder

value, remain our priorities.

STRATEGY AND PROSPECTS

We believe that, despite the challenges presented

by the current trading environment, we are capable

of achieving growth in earnings in 2002. In the

longer term, we believe that all our businesses

enjoy attractive growth prospects and that we will

be able to add new holiday businesses to the Group

through acquisition.

Richard Atkinson

Chief Executive

Holidaybreak plc

Page 4

16% Adventure Holidays

30% Hotel Breaks

54% Camping

Sales by Division

Rev i ew of Opera t i o n sby Rich a rd Atkinson Chief Exe c u t i ve

Rev i ew of Opera t i o n sby Rich a rd Atkinson Chief Exe c u t i ve

Page 5

The Group

In the year to 30 September 2001 Holidaybreak plc showed a strong financial performance inall its activities and the Group achieved increases in profit before tax and earnings per shareof 15% and 12% respectively, before goodwill amortisation and exceptional operating costs.Net debt has been significantly reduced and the continued underlying trend of profitabilityand strong operational cash flows of all our businesses will enable us to build interest coverand pay down debt over the coming years.

The net interest charge of £2.9m was down slightly

despite the costs of the acquisition expenditure being

included for a full year. Net interest cover increased

from 7.7 times in 2000 to 8.6 times in 2001.

We have adopted FRS 19 "Deferred Tax" and full

provision has been made for deferred tax. The

comparative results for 2000 have been restated to

reflect this change in Accounting Policy. The Group’s

tax charge, including full provision for deferred tax,

was £6.3m and the effective tax rate was 29%

(2000 restated: 30%).

Headline earnings per share, stated before

exceptional operating costs and amortisation of

goodwill, were 38.1p per share, an increase of 12 %

over 2000 (34.0p).

The proposed final dividend represents an increase of

12.5% to 12.6p, giving a total dividend for the year

of 18.0p per ordinary share (2000: 16.0p). Our policy

is to increase dividends in line with growth in

earnings per share whilst maintaining dividend cover

at over 2 times.

DIVISIONAL RESULTS

Our Camping Division’s operating profit grew by 5%

to £17.8m on sales up by 1% to £103.7m. Operating

margin at 17.2% (2000: 16.6%) benefited from

increased sales in mobile home holidays and

excellent high season occupancy underpinned by a

strong U.K. market.

Hotel Breaks revenues were 25% higher at £57.8m.

Operating margin was maintained at 9.5% and

operating profits increased by 25% to £5.5m.

The results of the businesses in our Adventure

Division are included for a full year for the first time

following their acquisitions during 2000. Sales were

£31.0m and operating profit was £3.4m. The

comparative results for the previous period of seven

months following the acquisition of Explore

Worldwide showed an operating profit of £2.3m

and sales of £16.1m.

We estimate that the financial impact on the

Adventure Division, of the terrorist attacks on

September 11th was a loss of sales revenues of

approximately £0.3m and lost operating profit of

£130,000. In the case of Hotel Breaks the

estimated profits decrease was £30,000. There was

no impact on Camping.

EXCEPTIONAL OPERATING COSTS

The Group suffered exceptional operating costs of

£463,000 following the collapse of Independent

Insurance plc in June 2001. These included

additional premiums for the Group’s Business

Interruption and Public and Employee Liability

cover and a full provision for potential outstanding

claims.

BALANCE SHEET

Net assets of the group increased to £28.0m (2000

restated: £19.9m). Full provision has been made

for deferred tax and this resulted in an adjustment

to prior year reserves of £4.9m. Net debt gearing at

30 September 2001 was 89.5% compared to 162%

at the previous year end.

Investments of £1.9m (2000: £1.1m) represent

shares in the company purchased by the wholly

owned subsidiary, Holidaybreak Trustee Limited, in

respect of the company’s various share option and

share award schemes. Full details of all such

schemes are shown in Note 20 to the financial

statements.

CAPITAL EXPENDITURE

Net capital expenditure in the year to 30

September 2001 was £15.6m (2000: £15.8m). All

but a small part of this was accounted for by the

Camping Division with Hotel Breaks and Adventure

investing £0.5m, largely in IT development.

The Camping Division spent a total of £17.6m on

tents, equipment and mobile homes, which

accounted for the bulk of this figure at £11.2m.

Disposal proceeds in respect of mobile homes sold

at the end of their useful life were £2.9m. Overall

sales achieved net book value. It is the normal

policy to replace mobile homes at the end of their

sixth season. The number of units for replacement

for 2002 is below 2001 and hence we expect a

lower level of capital expenditure in the year ended

30 September 2002.

CASH FLOW

The group’s net borrowings at 30 September 2001

were £25.1m, compared with £32.2m in 2000.

Cash flow from our operating activities was

£39.7m, another very strong performance. All our

businesses have strong positive cash flow

characteristics that will enable us to build interest

cover and repay term debt in the coming year and

beyond.

During the previous year we negotiated new

facilities with our principal banks including £30.0m

of Medium Term Loans to finance the acquisitions

during that year and to provide headroom for

further acquisitions. We have made repayments

under these facilities of £12.0m. Available facilities

are now £68.0m and are sufficient to meet the

working capital, investment and bonding

requirements of the Group. In addition to these

facilities we entered into hire purchase agreements

with various UK financial institutions to finance the

purchase of mobile-homes. Interest on our core UK

borrowings of £28.0m has been covered for periods

up to four years through the purchase of interest

rate swaps.

THE EURO AND CURRENCY MANAGEMENT

The Group has continued to adopt its policy of

hedging net foreign currency exposures arising from

the sales in overseas markets and the costs of

operating overseas. Currency revenues, principally

Euros and US Dollars, represent approximately 25%

of total group revenues. Currency outflows account

for 35% of all group costs. To hedge the net

exposure for the coming year, we have entered into

forward contracts to sell cur rency revenues and buy

other currencies to finance outflows.

The Group has completed its preparation for the

introduction of the single European currency, in

terms of commercial and banking ar rangements

and financial systems. There have been no material

costs involved. UK entry into the single currency,

the timing and likelihood of which remains

uncertain, would, we believe, be of some benefit to

the Group, eradicating significant currency

exposures and reducing transaction costs.

Robert Baddeley

Finance Director

Holidaybreak plc

Page 6

Financial Rev i ew byBob Baddeley Finance Dire c to r

Financial Rev i ew byBob Baddeley Finance Dire c to r

Page 7

Finance

GROUP PROFIT AND LOSS ACCOUNT

Turnover in 2001 was up 17% on 2000 at £192.5m.

Operating profit before exceptional operating costs

and amortisation of goodwill increased by 13% to

£26.7m.

2001 Profit and Loss Account

Camping Hotel Adventure Group

2000 figures in brackets Breaks Holidays

Turnover £103.7m £57.8m £31.0m £192.5m

(£102.3m) (£46.1m) (£16.1m) (£164.5m)

Gross Profit £35.8m £11.0m £9.2m £56.0m(£34.7m) (£8.7m) (£4.9m) (£48.3m)

Operating Profit £17.8m £5.5m £3.4m £26.7m(£17.0m) (£4.4m) (£2.3m) (£23.7m)

Cruising the Gambia River with Explore Worldwide

Our Camping Division remains the principal profits engine of thegroup, accounting for 54% of sales and 67% of operating profitsin 2001. Consistent performance each year has underpinned theprofitability of the group as a whole and provided a firmfoundation for expansion and diversification.

Camping

Operating profit for 2001 increased by 5% to

£17.9m and margins improved once again as the

trend away from tents to more profitable mobile-

homes continued and effective yield management

enabled us to optimise the balance between

markets.

In 2000 the UK market was held back by the

effects of the Brittany oil spill but in 2001 it was

the strongest performer with overall bookings up

10%. Demand for peak season holidays in the UK

was particularly buoyant resulting in healthy

average sales values and excellent occupancy rates

in July and August, counterbalancing some

weakness in low season. A recent development has

been for some UK customers to use the low cost

airline services and car hire to reach their camp-

sites in Italy, Spain and the South of France. We

expect this to be a continuing trend.

Mobile-home holidays grew by 12% in the UK and

9% overall. The continuing shift in consumer

preferences to mobile-home accommodation was

reflected in an innovative new marketing campaign

launched by Eurocamp which included TV

advertising for the first time. Keycamp also tested

TV advertising, aiming to raise awareness amongst

retail travel agency customers as well as promote

direct sales.

With viewers now able to trace advertisers easily on

the internet, television has become a potentially

more viable ingredient in the marketing mix. There

has been considerable development in all the

division’s web sites which was recognised when

Eurocamp beat off high profile competition to win

the "Best Travel Website" from the Chartered

Institute of Marketing.

The strength of sterling in recent years has had a

major influence on our yield management strategy.

The effect of this has been to reduce the availability

of prime high season capacity for our non-UK

markets and consequently their scope for volume

growth. Germany and Holland and our other

smaller markets are an essential part of the overall

mix because of the seasonal balance they provide.

German demand for the late May to early June

Whitsun holiday period was stronger than ever,

particularly in Italy. Bookings from the Dutch

market tend to be more evenly spread but tent

holidays have retained their popularity more than

elsewhere, and the strong sales for early July

counterbalance the late starting UK school

holidays. Late June and early July bookings

predominate in the valuable Irish market where

Keycamp is the dominant player.

Our smaller brands, Eurovillages and Eurocamp

Independent operate only in the UK market. Both

had successful years, increasing both profits and

turnover. Between them they contribute nearly £1m

to divisional profits and unlike the main businesses

do not require significant levels of capital

investment.

The main capital expenditure requirement is for

mobile-homes. We are cur rently investing in both

new for expansion and replacement mobile-homes

each year. Currently we expect to keep mobile-

homes for six years and to achieve net book value

on resale. Net capital expenditure on mobile-homes

in 2001 was £11.2m with a further £5.8m being

spent on replacement tents and equipment.

Mobile-home fleet management is the responsibility

of our Overseas Operations team who have been

managing a considerably larger undertaking since

the acquisition of Keycamp in August 1998. We

continue to retain distinct branding and services in

all ‘customer facing’ activities both on and off site

but otherwise operate on a fully integrated basis.

Overall quality standards remain high and we were

able to record improvements in customer

satisfaction levels in 2001. This, together with

healthy recent sales trends and the fact that the

vast majority of customers travel by car give us

confidence in the prospects for further progress by

Camping in 2002.

Holidaybreak plc

Keycamp mobile-home

Keycamp children’s

courier on-site

Eurocamp tent

• Original and largest part of theGroup - 54% of total 2001 sales

• Two market leading brands -Eurocamp and Keycamp plusEurovillages (self-catering) andEurocamp Independent (camp-sitebooking service)

• Pre-sited mobile-homes and tents onquality camp-sites in France, Italyand six other European countries

• Courier and children’s activityservice

• Tailor made packages - any day toany day

• Self-drive holidays - ferry inclusivefrom UK

• Mainly direct sell but some retailagent sales

• Customers from nine countries(mainly UK, Germany and Holland)

• Mid to upper income, familycustomer base

Page 9Page 8

Bookings Sales

9% Others 6%17% Holland 14%

17% Germany 9%

57% UK/Ireland 71%

Bookings and Sales by Market (2001)

Hotel Breaks enjoyed an excellent year in 2000 but thisperformance was surpassed in 2001. Operating profit grew by 25%to £5.5m on sales of £57.8m leaving the overall margin virtuallyunchanged. Whilst in 2000 market conditions were almost whollyfavourable, this was far from the case in 2001 which makes oursecond largest division’s achievements all the more noteworthy.

Hotel Breaks

Approximately 20% of Hotel Breaks’ customers

book rail inclusive holidays. We estimate that up to

another 30% purchase their rail tickets from

another source. The disruption suffered in the wake

of the Hatfield and Selby disasters clearly

discouraged rail travel and indeed this aspect of our

business was noticeably affected. However, despite

this and the November 2000 floods affecting some

customers’ ability or desire to travel, overall demand

remained buoyant throughout the autumn and

winter months.

London is the principal rail destination. One reason

why pre-Christmas bookings held up so well was

our success in selling good numbers of Millennium

Dome breaks throughout calendar year 2000, in

spite of the adverse publicity which the project

attracted from the media. A further boost came

through the acquisition of Rainbow Holidays in

September 2000. Across the year we estimate that

sales growth was enhanced by approximately 10%

due to the acquisition. Initially we continued to use

existing brochure stocks but merged Rainbow into

the Superbreak and Hotel Breaks programmes from

April 2001.

Whilst the rail problems eased as we moved into

spring 2001, the foot and mouth epidemic posed a

further threat. Initiall y, we did see bookings for

Devon, the Lakes and other countryside

destinations falling away. However, these have

never been a major part of our overall mix and it

soon became apparent that increased bookings for

city, town and seaside breaks would more than

compensate. Foot and mouth did undoubtedly

affect our fledgling inbound business which comes

mainly from Holland, Ireland and the USA.

However, these represent only a very small part of

our total sales and the longer term potential for

incoming business from overseas remains

unchanged.

As ever, the cornerstone of the business was sales

through high street travel agents which again

showed a healthy increase. With the Rainbow

acquisition we estimate that we service over 60%

of all UK hotels breaks booked through retail travel

agents. Growth in direct bookings was faster than

from travel agencies but the most dramatic figures

came from the internet.

Our on-line superbreak.com booking facility

accounted for over 10% of total revenues, up from

3% in 2000. One in eight bookings now come

from this source.

Two thirds of our internet business comes through

on-line intermediaries or por tals. The largest of

these is Hotelnet, a business we acquired in July

2000. As well as providing valuable support for

our main on-line business Hotelnet also generates

commission income from a worldwide portfolio of

over 40,000 hotels all of which can be booked

directly on-line. The business was loss making in

2001 due to site development costs and marketing

investment but we expect it to become profitable in

2002.

The internet has been one of the key development

areas over the past year. A whole range of

other initiatives in product

development and distribution

have contributed to our overall

achievement.

Looking forward, the major new development has

been the launch of the new European programme.

This offers accommodation only breaks in 40

European cities leaving customers to arrange their

own travel with the low cost airlines or surface

transport companies.

The European brochure is being distributed direct

and through travel agencies where it has been very

well received. There is every sign that the modest

slowdown in demand following September 11th was

purely temporary. The Hotel Breaks Division is well

positioned for a third successive year of strong

growth.

Holidaybreak plc

• Acquired 1995 – 30% of 2001total Group sales

• Superbreak the main brand – alsoHotel Breaks, Luxury HotelCollection, Theatrebreak, AirportHotels and Hotelnet

• Breaks in 1400 UK hotels (200 inLondon)

• New ‘accommodation only’European programme (350 hotelsacross Europe and in the USA)

• No commitment allocations

• Price guarantee to customers

• Rail inclusive and theatre breaksavailable

• 60% of sales through UK travelagents, balance direct and internet

Page 11Page 10

14.2% Hotel Breaks

13.7% Airport Hotels

7.4% Theatrebreak

3.5% Luxury Hotel Collection

61.2% Superbreak

Sales by Brand

Ian Mounser of Superbreak receives the

CBI "Fit for the Future" Award

Selsdon Park Hotel

Our Adventure Holidays Division, which accounts for 16% of Group turnover, was formed lastyear when we acquired Explore Worldwide in February 2000, followed by scuba diving specialistRegal Holidays in August. These businesses have achieved very satisfactory growth at both therevenue and operating profit lines in 2001. A new managing director has been appointed and anumber of important operational and marketing changes have been instigated.

Adventure Holidays

Even before September 11th we had experienced

more than the usual level of regionalised disruption

which is part and parcel of the operation of the

Explore business. The most notable of these events

were in Nepal and Sri Lanka both of which are now

back to normal. As noted in the Chairman’s

statement, the disruption and loss of September

bookings immediately following the ter rorist attacks

resulted in an estimated turnover loss of £300,000

and £130,000 in operating profits. Adventure sales

eventually came in 12% ahead of the pro-forma

2000 figure at £31.0m. The net margin was

reduced slightly due to reorganisation and

development costs most of which had been

anticipated at the time of acquisition.

A great strength of Explore Worldwide’s business is

its flexible operational cost base. Only scheduled

aircraft seats are used, with no guarantees given or

block commitments taken. At the destination end,

we hire in transport and ancillary equipment on a

needs basis and do not make upfront commitments

for hotel accommodation. Tour load factors are

nevertheless important for profitability because of

the fixed costs involved in providing transport and

our tour leader. We do not run unprofitable tours

and have overall load factor targets which, in

normal circumstances, we have been able to

achieve consistently each year. We were successful

in this aim in 2001 except in September when, for

understandable reasons, there was a rush of late

cancellations hitting load factors during that

period.

Whilst destinations such as Nepal, Egypt, East

Africa and Peru are perennial favourites, the most

prominent recent increases in demand have been

for shorter holidays to European and North African

destinations. We see this as being an important

area of opportunity for Explore where our product

range is relatively underdeveloped, one incidentally

which we would expect to be particularly popular in

the current uncertain climate for travel further

afield. The new 2002 brochure which has been

recently published caters for this trend with many

more tours in the short-haul category on offer.

One of the few destinations where bookings

actually fell back in 2001 was Egypt. Following the

Luxor incident visitor numbers at first fell away

sharply but then surged back dramatically as pent-

up demand came through. The fall this year

reflected, we believe, a return to more sustainable

levels of demand for a destination which is now

served by a wide range of tour operators.

Egypt is of course the major destination for our

diving specialist Regal Holidays. The dynamics of

this business are rather different. The Red Sea

offers easily accessible warm water diving which is

on a par with anywhere else in the world.

Committed divers return on a regular basis and

novices come in increasing numbers to take their

first steps in this exhilarating and increasingly

popular activity, in a far more attractive

environment than can be found in the UK.

Hurghada and Sharm-el-Sheikh are the two main

Red Sea resort destinations. These are served by

weekly year round charter flights which serve both

the diving and the ‘beach and pool’ market. This

second category of customer assists us in filling our

own charter seats ef ficiently during periods of

softer demand from the diving fraternity.

As well as growing quickly in popularity diving is an

activity which covers a broad spectrum of ages and

social groups. At the upper end of the market there

is increasing demand for more exclusive and exotic

destinations such as the Caribbean, Maldives and

Indonesia. These trips involve scheduled air travel

and so no financial commitments on our part. The

expertise of Explore’s management in the scheduled

flight sector has proven a useful asset as we seek to

increase the proportion of this higher margin

business.

Simon Tobin, formerly with Keycamp, succeeded

Explore founder Travers Cox as divisional Managing

Director when, as anticipated, the latter stepped

down at the end of 2000. The other key senior

management appointee was Joanne Field, who has

wide ranging travel industry experience, to the new

position of Marketing Director. Reorganisation has

put the business on a sounder footing for future

expansion and, over the past few months, a whole

range of new tours has been added to the

programme, a rejuvenated 2002 brochure

published and an impressive website launched.

All adventure and long haul travel companies have

been affected by September 11th. However, we

believe that this will be a temporary situation and

that the popularity of unusual, exotic and active

holidays will soon resume its strong growth trends.

Our adventure companies will be at the forefront of

these developments.

Holidaybreak plcCamel trekking in the Sahara

• Division formed last year - 16% of sales

• Explore Worldwide - market leaderin worldwide adventure travel;small groups with own tour leader(100 countries); scheduled flights;walking and trekking, wilderness,wildlife and cultural tours

• Regal Holidays - leader in scubadiving holidays to the Red Sea(Egypt), Maldives, Caribbean andFar East ; charter flights to RedSea, scheduled flights to otherdestinations; ‘learn to dive’ and‘liveaboard’ holidays a speciality

• Sell direct and through specialistUK and overseas agents

Page 13Page 12

6.1% Greece & Turkey

9.5% Europe

9.7% India & Nepal

14.6% Africa

15.9% Asia

20.1% Americas & Pacific

24.1% Egypt & Middle East

Adventure Holiday Sales (2001)

Traditional clothing in Gujarat

On the Venezuelan ‘Lost World’ tour

Page 15Page 14

Holidaybreak plc

The directors present their annualreport on the affairs of theGroup, together with thefinancial statements and auditors’report, for the year ended 30 September 2001.

Directors’ ReportPrincipal Activities and Business Review

The Company acts as the holding company for

Eurocamp Travel Limited, Eurocamp Travel GmbH,

Eurocamp Travel (Schweiz) AG, Camping in Comfor t

BV, Keyline Continental Limited, Superbreak Mini

Holidays Group Limited, Explore Worldwide Limited,

Regal Diving & Tours Limited and their subsidiar y

undertakings. The principal activities of the Group

are the provision of camping holidays including the

hiring-out of fully equipped tents and mobile-homes

on camp-sites throughout Europe, the provision of

hotel short-breaks in the UK and continental

Europe and worldwide adventure and activity

holidays.

A detailed review of operations is included on

pages 4 to 13.

Results and Dividends

The profit after taxation for the year ended 30

September 2001 amounted to £15,354,000 (year

ended 30 September 2000 - restated

£13,990,000). The directors recommend a final

dividend of 12.60p (2000 – 11.20p) per ordinary

share which, together with the interim dividend of

5.40p (2000 – 4.80p), represents a total of 18.00p

per ordinary share (2000 – 16.00p).

It is proposed that the retained profit of £7,011,000

(2000 - restated £6,265,000) be transferred to

reserves.

I nve s tor Relat i o n s

Holidaybreak is committed to excellence in

investor relations. Our aim is to ensure that

large and small shareholders, market

analysts and the financial media are able to

gain easy access to up-to-date and relevant

information about the business and its

current progress. The principal sources of

information include:

• Annual Report and Accounts

• Interim Report

• Corporate Website

• Our e-mail alert service

In addition, each year we issue four statements on

current trading. Two are combined with the

Chairman's statements issued at the time of the

annual and half-year results announcements.

Further announcements are issued on the day of

the Company's AGM and in September of each year.

We also aim to keep investors informed of

developments as they happen, and to respond to

queries for information in as short a time as

possible.

One to one and group meetings are regularly

offered to analysts and institutional investors,

usually soon after results or trading

announcements. At other times we will endeavour

to satisfy requests for meetings or information,

subject always to our obligation to ensure that

information of a potentially price sensitive nature is

released first by way of a stock exchange

announcement. At the heart of our IR programme

is transparency and we value feedback from

investors on any aspect of Holidaybreak's activities.

Progress of the Investor Relations programme,

which is primarily carried out by the Chief Executive

and Finance Director, is reviewed by the directors at

monthly Board meetings

CORPORATE WEBSITE

Holidaybreak’s approach to communicating online

is continually evolving as part of our overall

investor relations strategy. The corporate website is

an indispensable information resource for anyone

interested in Holidaybreak plc. We aim to satisfy

the needs of a broad range of potential users who

have an interest in our financial and corporate

affairs, institutional and private investors, analysts

and the financial media, students, customers and

employees.

All Company announcements are available on the

website as soon as they are released by the London

Stock Exchange. There is also a wealth of

background information about the Company and its

development, detailed biographies of directors and

other senior management, information on the

shareholder discount scheme and links to the

consumer sites of all trading companies which form

the Holidaybreak Group. Visitors to the site are able

to view analyst and institutional presentations and

can also be put on our e-mail distribution list. They

will then automatically receive all our

announcements as they are released.

In March 2001 Holidaybreak won the Investor

Relations Society award for Best Smaller Quoted

Company website, in recognition of the site’s

content, accessibility, timeliness and navigation,

technology and interactivity.

Share Price Listing

The current Holidaybreak share price is listed in the

following national and regional newspapers:

Financial Times The Times

The Independent The Daily Telegraph

The Guardian The Daily Mail

The Daily Express Evening Standard

Birmingham Post Manchester Evening News

Scotsman Western Mail

Yorkshire Post

The share price may also be viewed on our website

at www.holidaybreak.co.uk and on various teletext

and internet financial sites. The Holidaybreak

website includes interactive comparative share price

graphing against relevant indices, and a record of

volumes traded throughout the day.

SHAREHOLDER DISCOUNTS

Shareholders with more than 200 shares are able to

benefit from the Company's shareholder discount

scheme, which allows a 10% reduction on the full

brochure price of any holiday booked direct with a

member of the Group. Full details of the scheme

can be sent out on request and are also available

on the Company’s internet site at

www.holidaybreak.co.uk.

FINANCIAL CALENDAR

Annual General Meeting 26 February 2002

Results

Announcement of half year results

to 31 March 2002 May 2002

Announcement of annual results

to 30 September 2002 December 2002

Dividend

Final dividend

(for year to 30 September 2001)

•ex-dividend 20 March 2002

•payable 23 April 2002

Interim dividend

(for year to 30 September 2002) August 2002

Substantial Shareholdings

As at 15 December 2001 the directors were aware of the following interests of over 3% of the

Company’s issued share capital: Number of % of share

Shares capital

CGNU plc/Morley Fund Management Limited 5,964,064 12.85

Schroder Investment Management Limited 4,265,624 9.19

Zurich Financial Services Group (Scudder Threadneedle) 3,971,831 8.56

Aberforth Partner s 3,530,000 7.61

Standard Life Group 3,465,180 7.47

Fidelity International Limited 2,568,436 5.53

Edinburgh Fund Managers 2,390,858 5.15

Legal & General Investment Management Limited 2,102,336 4.53

Deutsche Asset Management 1,866,861 4.02

Friends Ivory & Sime 1,700,841 3.67

Barclays plc 1,583,216 3.41

Montanaro Investment Management 1,455,000 3.14

AEGON UK plc (Scottish Equitable) 1,419,197 3.06

Shares by size of registered holding

(at 15 December 2001)

No. of Number % of

Holders of shares Total

Up to 1,000 1,366 533,075 1.15%

1,001 - 10,000 370 909,456 1.96%

10,001 - 50,000 61 1,279,272 2.76%

50,001 - 100,000 29 2,088,712 4.50%

100,001 - 500,000 30 7,059,724 15.21%

Over 500,000 31 34,539,004 74.42%

Total 1,887 46,409,243 100%

27.3% Insurance companies (8)

44.8% Investment and unit trusts (24)

3.9% Holdings not analysed

3.5% Directors, employees & trustee of Holidaybreak plc share schemes

4.4% Others including managed, Private clients & PEPS

16.1% Pension funds (16)

Shares by category

(number of fund managers)

Some substantial shareholdings are split

into more than one registered holding.

Di re ctors and Adv i s o r s

The Board of Holidaybreakplc consists of six executivedirectors and three non-executives. In addition tothe Group Chief Executiveand Finance Director, themanaging directors of thethree operating divisions (inthe case of Hotel Breaksjoint managing directors)are members of the Board.

Company Review

Di re ctors Biog ra p h i e sBrief biographies of the Company's directors are

given below. Fuller information on directors and

other senior managers can be found on our website

at www.holidaybreak.co.uk.

NON-EXECUTIVE DIRECTORS

Angus Crichton-Miller (62)

Chairman

Joined Rank Group plc in 1969 and was appointed

to the Main Board in 1982. Managing Director of

Rank Holidays and Hotels Division from 1990 until

1996. From 1997 to 2001 he was chairman of the

Racecourse Association and a director of the British

Horseracing Board and the Horseracing Betting

Levy Board. Holds two other non-executive

directorships including TDG plc. Appointed non-

executive director of Holidaybreak in December

1996 and became Chairman in June of the

following year.

Peter Folkman (56)

Chairman of the Audit Committee and

Senior Non-executive Director

Twenty-five years' experience in the venture capital

industry, initially with 3i plc where he became a

director in 1986. Left 3i in 1988 to establish North

of England Ventures Ltd which was, in turn,

acquired by Granville Baird in 1996. Mr Folkman

has extensive experience as a non-executive director

of both unquoted and quoted companies.

Appointed to the Board of Holidaybreak as a non-

executive director in September 1997, and became

the senior non-executive director in May 2001.

Clive McLintock (63)

Chairman of the Remuneration Committee

Became a founder director of Barclays Development

Capital Ltd in 1979 after a career in scientific

instrument marketing management and in the City

with a quoted investment trust. Has subsequently

held a variety of board positions, including a non-

executive directorship with Unijet Group plc from

1991 to 1996. Currently part-time executive

chairman of Forum 21 Ltd, a business development

support company that he founded in 1995.

Appointed a non-executive director of Holidaybreak

in August 1999.

EXECUTIVE DIRECTORS

Richard Atkinson (48)

Chief Executive

Appointed Managing Director of Eurocamp Travel

Ltd in 1983 having originally joined the Company

in 1976 as Overseas Manager. Led the management

buy-out in 1988 and became Chief Executive in

January 1996. He is on the board of the

Association of Independent Tour Operators and is a

non-executive director of Keyworld Investments plc.

Robert Baddeley (48)

Finance Director

A Chartered Accountant, he joined the Company in

February 1995 from Swan Steel Group Ltd where he

was Group Finance Director. His career has included

senior financial positions at the Albert Fisher Group

plc and Unigate plc.

Jim Crew (54)

Camping Division Managing Director

Joined the Company in 1989 following a career first

in engineering and then in consultancy. Became a

director in 1990 and was appointed Managing

Director of Eurocamp Travel Ltd in 1996. Now

responsible for all the activities of the Group's

Camping Division.

Nick Cust (44)

Joint Managing Director, Hotel Breaks Division

Has worked in the leisure industry since 1980.

Joined Superbreak in 1985 and was a leading

member of the MBO team. Current responsibilities

include sales, marketing, product development and

key hotel and agent contacts. Appointed to the

Board in September 1997.

Mark Wray (45)

Joint Managing Director, Hotel Breaks Division

A Chartered Accountant, he joined Superbreak in

1984 as Finance Director and was a leading

member of the MBO team. Special responsibility for

finance and administration. Appointed to the Board

in September 1997.

Page 17Page 16

DIRECTORS

The directors of the Company who served during

the year were as follows:

H.A. Crichton-Miller (non-executive chairman)

R.W. Atkinson

R.G. Baddeley

T.V. Cox(resigned 1 January 2001)

J.R. Crew

N.P. Cust

P.J. Folkman (senior non-executive)

C.H. McLintock (non-executive)

S.J. Tobin(appointed 1 January 2001)

M.C. Wray

Members of the Holidaybreak plc Board, left to right:

Nick Cust, Julie Vickers (Company Secretary), Simon Tobin, Richard Atkinson, Clive McLintock, Angus Crichton-Miller (Chairman), Robert Baddeley,Peter Folkman, Mark Wray and Jim Crew.

Holidaybreak plc

In accordance with the Articles of Association of the Company, R.W. Atkinson,

R.G. Baddeley and J.R. Crew retire by rotation at the 2002 Annual General Meeting

and, being eligible, offer themselves for re-election. Details of their service

agreements are as follows:

Director Date of service Initial period Notice period agreement (after expiry of

initial period)

R.W. Atkinson 26 June 1991 3 years 24 months (see note below)

R.G. Baddeley 18 January 1996 1 year 12 months

J.R. Crew 26 June 1991 2 years 12 months

The Remuneration Committee has agreed in principle with Mr. R.W. Atkinson that he should have a

new service agreement that will include a reduction in the notice period to 12 months in accordance

with best practice guidelines. The Company and Mr. Atkinson are now in the process of finalising

the new agreement.

Simon Tobin (46)

Managing Director, Adventure Holidays Division

Joined Keycamp Holidays in 1990 from Contiki Travel,

the European coach holiday operator where he was

Director and General Manager. He was appointed

sales director of Keycamp in 1995 and managing

director in 1998, soon after the acquisition by

Holidaybreak. Appointed managing director of

Explore Worldwide and the Adventure Holidays

Division in January 2001, at which point he also

became a member of the Board.

PRINCIPAL ADVISORS

Details of the Company’s main advisors are shown

below:

Auditors

Arthur Andersen, Chartered Accountants, Bank

House, 9 Charlotte Street, Manchester M1 4EU

Solicitors

Eversheds, Eversheds House, 70 Great Bridgewater

Street, Manchester M1 5ES

Financial Advisers

Hawkpoint Partners Ltd, 4 Great St Helens, London

EC3A 6HA

Principal Bankers

Barclays Bank, 51 Mosley Street, Manchester

M60 2HQ

Stockbrockers

Teather & Greenwood Limited, Beaufort House,

15 St Botolph Street, London EC3A 7QR

Registrars

Northern Registrars Ltd, Northern House, Woodsome

Park, Fenay Bridge, Huddersfield HD8 OLA

Reappointment of Auditors

The directors will place a resolution before the

Annual General Meeting to reappoint Arthur

Andersen as auditors for the ensuing year.

In June 1998 the HampelCommittee and the LondonStock Exchange publishedthe Combined Code oncorporate governance. Thiscombines the Cadbury Codeon corporate governance,the Greenbury Code ondirectors' remuneration andnew requirements arisingfrom the findings of theHampel Committee.

The Board is accountable tothe Company's shareholdersfor good governance andthis statement outlines howthe principles set out inSection 1 of the CombinedCode have been appliedthroughout the accountingperiod.

BOARD RESPONSIBILITIES AND PLANNING

The Board has overall responsibility for the

management of the Group, the formulation of the

Group’s corporate strategy, approval of acquisitions,

annual Group budget, major capital expenditure and

disposals and treasury policy. Control of operational

matters is delegated through the Group Chief

Executive, the Group Finance Director, the respective

divisional and subsidiary managing directors and

local directors as appropriate. This structure ensures

a strong link between corporate strategy and its

effective implementation.

The Board meets at least once each month to review

the affairs and trading progress of the various

businesses within Holidaybreak plc and the Group as

a whole. Each of the executive directors report to the

Board on relevant matters relating to their areas of

responsibility, having previously circulated written

reports to all Board members. All members of the

Board are expected to attend the main monthly

meetings and to arrange their diaries to ensure that

this is possible. With two exceptions there was

100% attendance at all meetings in the period

covered by this Annual Report.

The three trading divisions of the Group, Camping,

Hotel Breaks and Adventure Holidays also hold

monthly board meetings to report on and review

trading progress and discuss future plans. The Group

Chief Executive and Group Finance Director sit on the

divisional boards and attend meetings in a non-

executive capacity.

The planning and budgeting cycle enables

management at all levels to identify and address all

significant business risks and to control the strategic

and financial objectives of the Group. The Board is

responsible for the formulation of medium term

corporate strategy. This in turn provides a basis for

the formulation and review of divisional strategy by

the divisional boards. All strategic plans are subject

to an annual review. Divisional strategic plans and

annual reviews are presented to and reviewed by the

Board and, once approved, form the basis of annual

budgets.

COMPLIANCE WITH THE PROVISIONS OF

THE COMBINED CODE

Save for the one exception outlined below, the

directors consider that throughout the accounting

period ended 30 September 2001 the Company has

complied with the Code provisions set out in

Section 1 of the Combined Code annexed to the

listing rules.

B.1.7 The service agreement for the Chief Executive

provides for a two year notice period. This is

currently under review and agreement in

principle has been reached for the reduction of

this notice period to one year in accordance

with best practice guidelines.

DIRECTORS' RESPONSIBILITIES

Company law requires the directors to prepare

accounts for each financial year which give a true

and fair view of the state of affairs of the Company

and Group and of the profit or loss of the Group for

that period. In preparing the accounts, the directors

are required to:

• Select suitable accounting policies and then

apply them consistently,

• Make judgements and estimates that are

reasonable and prudent,

• State whether applicable accounting standards

have been followed, subject to any material

departures disclosed and explained in the

accounts,

After making enquiries, the directors have a

reasonable expectation that the Company and the

Group have adequate resources to continue in

operational existence for the foreseeable future. For

this reason, they continue to adopt the going

concern basis.

The directors are responsible for keeping proper

accounting records which disclose with reasonable

accuracy at any time the financial position of the

Company and the Group and enable them to

ensure that the accounts comply with the

Companies Act 1985. They are also responsible for

safeguarding the assets of the Company and the

Group and hence for taking reasonable steps for

the prevention and detection of fraud and other

irregularities.

There are inherent limitations in any system of

internal financial control and accordingly even the

most effective system can provide only reasonable,

and not absolute, assurance with respect to the

preparation of financial information and

safeguarding of assets. The Board regularly reviews

the effectiveness of the systems, control and

reporting procedures and will continue to do so,

making any changes required as a result of the

review and the development of the Group.

The Board has applied Principle D.2 of the

Combined Code by establishing a continuous

process for identifying, evaluating and managing

the significant risks the group faces. The Board

regularly reviews the process, which has been in

place from the start of the year to the date of

approval of this report and which is in accordance

with Internal Control: Guidance for Directors on the

Combined Code published in September 1999. The

Board is responsible for the Group's system of

internal control and for reviewing its effectiveness.

Such a system is designed to manage rather than

eliminate the risk of failure to achieve business

objectives, and can only provide reasonable and not

absolute assurance against material misstatement

or loss.

Holidaybreak plc

Page 18 Page 19

Corporate GovernanceNon-executive directors are appointed for specified

terms of three years, subject to three months notice

within that period and also subject to re-election

and to Companies Act provisions relating to the

removal of a director. Reappointment is not

automatic. All directors are subject to election by

shareholders at the first opportunity after their

appointment and to re-election thereafter at

intervals of not more than three years.

Directors are able to take independent professional

advice, if required, at the expense of the Company.

They also have access at all times to the advice and

services of the Company Secretary who is

responsible to the Board for ensuring that Board

procedures are followed and that applicable rules

and regulations are complied with.

Executive directors receive annual appraisals which

are carried out by the Chief Executive. Appraisal

reports are reviewed by the Remuneration

Committee. The Chairman carries out annual

appraisals for the Chief Executive and the other

non-executive directors. All directors receive

appropriate induction training on appointment to

the Board. Other training requirements are

identified as part of the annual appraisal process.

The Audit Committee consisting of the non-

executive directors and chaired by Peter Folkman,

reviews the half-year and annual financial

statements and matters related to internal controls,

including the external audit function.

The Nomination Committee comprising the non-

executive directors and the Chief Executive and

chaired by Angus Crichton-Miller, is responsible for

recommending candidates for Board appointment.

The Remuneration Committee comprising the non-

executive directors and chaired by Clive McLintock

is responsible for ensuring that remuneration policy

facilitates the attraction, retention and motivation

of senior executives of appropriate calibre, whilst

avoiding unnecessary cost.

THE BOARD OF DIRECTORS

The Board of Directors consists of six executive

directors and three independent non-executive

directors, all of whom are considered to be

independent of management and free from any

business or other relationship which could

materially interfere with the exercise of their

independent judgement. The posts of Chairman,

which is a non-executive position, and Chief

Executive are not combined ensuring a clear

division of responsibility at the head of the

Company. A senior non-executive director has been

designated. Biographical notes on all the directors

are to be found on the Company Review page and

fuller biographies are available on the Company's

web site at www.holidaybreak.co.uk.

The Board of Directors hasoverall responsibility forensuring that the Companymaintains a system ofinternal financial control toprovide them withreasonable assuranceregarding the reliability offinancial information usedwithin the business and forpublication and that assetsare safeguarded. The Boardis not aware of anyweaknesses in internalfinancial control that haveresulted in any materiallosses, contingencies oruncertainties requiringdisclosure in the accounts.

Subsidiary businesses produce monthly

management accounts information which is used to

compare actual performance with budget and

medium-term plans. These accounts include updated

forecasts and other information to enable the Board

to assess the prospects of all businesses in the

Group. There are specific guidelines for the

appraisal and authorisation of all capital

expenditure and disposal proposals.

The Group has an established internal organisation

structure with clearly defined lines of responsibility

and accountability. This is supported by well

established and documented accounting controls

and procedures common to all individual businesses.

Certain of the Group's key functions including the

company secretariat, treasury, legal, taxation and

business risk insurance are under taken centrally

under the direct control of the Group Chief

Executive and the Group Finance Director.

Internal Control

Employee representatives, who are members of a

staff council, are consulted regularly on a wide range

of matters affecting their current and future interests.

All permanent employees are entitled to receive

bonuses related to individual or team performance.

All permanent UK employees of the Group are given

the opportunity to join the Savings Related Share

Option Scheme.

CREDITOR PAYMENT POLICY & NUMBER OF

DAYS

The Group’s policy is to pay suppliers on terms

agreed with each supplier. The Company had no

trade creditors outstanding as at 30 September

2001.

AUDITORS

The directors will place a resolution before the

Annual General Meeting to reappoint Arthur

Andersen as auditors for the ensuing year.

ANNUAL GENERAL MEETING

All shareholders receive at least 21 working days

notice of the Annual General Meeting at which all

directors of the Company and chairmen of the

Audit, Nomination and Remuneration Committees

are introduced and are available for questions.

The 2002 Annual General Meeting will be held at

The Oaklands Hotel, Millington Lane, Gorstage,

Weaverham, Northwich, Cheshire CW8 2SU on

Tuesday 26 February 2002 at 2.30 p.m.

The notice convening the meeting together with

the full text of all resolutions are to be found on

pages 43-44 of this Annual Report.

Special Business to be conducted at the

Annual General Meeting

Three resolutions will be proposed as special

business at the forthcoming Annual General

Meeting as follows:

Authority to allot equity securities: Resolution 7

Section 80 of the Companies Act 1985 ("the Act")

provides, in relation to all companies, that the

directors may not allot relevant securities (as

defined in that section) unless authorised to do so

by the Company in general meeting or by its

Articles of Association.

Resolution 7 seeks to renew for a further defined

period, expiring at the conclusion of the 2003

Annual General Meeting or, if earlier, 15 months

after the passing of the resolution, the directors’

limited authority to allot the unissued share capital

of the Company. The authority will relate to

allotments of equity securities up to an aggregate

nominal value of £773,400, representing just under

one-third of the issued ordinary share capital of the

Company as at 15 December 2001. The directors

have no present intention of allotting, or agreeing

to allot, any shares pursuant to this authority

otherwise than in connection with employee share

schemes to the extent permitted by such schemes.

Disapplication of pre-emption rights: Resolution 8

Section 89 of the Act gives holders of equity

securities (within the meaning of the Act), with

limited but important exceptions, certain rights of

pre-emption on the issue for cash of new equity

securities. The directors believe that it is in the best

interests of the Company that, as in previous years,

the Board should have limited authority to allot

some part of the Company’s authorised but

unissued equity share capital for cash without first

having to offer such shares to existing shareholders.

The Board’s current authority expires at the

conclusion of the 2002 Annual General Meeting

and, accordingly, resolution 8 seeks to renew this

authority on similar terms for a further period,

expiring at the conclusion of the 2003 Annual

General Meeting or, if earlier, 15 months from the

passing of the resolution.

The authority, if granted, will relate to allotments

in respect of rights issues and similar offerings

(where difficulties arise in offering shares to

certain overseas shareholders and in relation to

fractional entitlements) and generally to

allotments (other than in respect of rights issues)

of equity securities having an aggregate nominal

value not exceeding £116,000 (representing just

under 5% of the issued ordinary share capital of

the Company as at 15 December 2001).

Purchase of own shares: Resolution 9

Resolution 9 seeks to renew the authority of the

Company to make market purchases of its own

shares. The authority granted by shareholders at

the last Annual General Meeting expires at the

conclusion of the 2002 Annual General Meeting

and, accordingly, resolution 9 seeks to renew the

authority on similar terms for a further period,

expiring at the conclusion of the 2003 Annual

General Meeting or, if earlier, 15 months after the

passing of the resolution.

The authority, if granted, will apply to up to

4,640,900 ordinary 5p shares, representing just

under 10% of the issued ordinary share capital of

the Company as at 15 December 2001. There is

no intention, at present, to use the authority but

the directors consider it advantageous for the

Company to be in a position to make such

purchases. Purchases will only be made where

they are, in the opinion of the directors, in the

interests of the shareholders and where they

should result in an improvement of earnings per

share. The resolution specifies the maximum and

the minimum price at which they may be

purchased, reflecting the requirements of the Act

and the Listing Rules of the United Kingdom

Listing Authority. Purchases would only be made

on the London Stock Exchange.

Any shares purchased would be cancelled and the

number of shares in issue would be reduced.

The number of options to subscribe for new equity

shares that were outstanding at 15 December

2001 (the latest practicable date prior to the

printing of this document) was 2,075,560,

representing approximately 4.47% of the issued

share capital at that date. Should the authority

sought by this resolution be exercised in full, that

number of options would then represent

approximately 4.97% of the issued share capital

at that date.

By order of the Board

J.A. Vickers ACIS

Secretary

Hartford Manor, Greenbank Lane, Northwich,

Cheshire CW8 1HW.

10 December 2001

Holidaybreak plc

Page 20 Page 21

Other InformationCHARITABLE AND POLITICALCONTRIBUTIONSThe Group contributed £24,653 to charities. In

addition, the Group gave support to various

charities, including Children’s Aid Direct, in the

form of donations of used tents and equipment.

The Company did not make any contributions to

political parties.

DISABLED EMPLOYEES

Applications for employment by disabled persons

are always fully considered, bearing in mind the

aptitudes of the applicant concerned. In the event

of members of staff becoming disabled every ef fort

is made to ensure that their employment with the

Group continues and that appropriate training is

arranged. It is the policy of the Group that the

training, career development and promotion of

disabled persons should, as far as possible, be

identical with that of other employees.

EMPLOYEE CONSULTATION

The Group places considerable value on the

involvement of its employees and keeps them

informed on matters affecting them as employees

and on the various factors affecting the

performance of the Group. This is achieved through

formal and informal meetings, regular briefings, the

Company newsletter and circulation of results

announcements and important public statements.

INTERNAL CONTROL (continued)

In compliance with Provision D.2.1 of the

Combined Code, the Board continuously r eviews the

effectiveness of the Group's system of internal

control. The Board's monitoring covers all controls,

including financial, operational and compliance

controls and risk management. It is based

principally on reviewing monthly reports from

executive management to consider whether

significant risks are identified, evaluated, managed

and controlled and whether any significant

weaknesses are promptly remedied and indicate a

need for more extensive monitoring. The Board has

considered the need to establish an internal audit

resource and have concluded that the cur rent

control mechanisms are sufficient for the size of the

Group. The Board will continue to review this

decision. The Board has commissioned a specific

assessment of the Group’s Risk Management

Policies and Procedures including those internal

controls that exist to mitigate the impact of

identified risks. It is not the Group’s intention to

avoid all commercial risks and commercial

judgement will be made in the course of the

management of the Group’s operations.

The Audit Committee assists the board in

discharging its review responsibilities.

Children at project Lightforce International in

Albania benefiting from donated tents

Holidaybreak and the Environment

The Board of Holidaybreak plc recognises the

environmental issues arising from the growth in

travel and fully supports the principles of

sustainable tourism. Our operating companies act

as facilitators rather than principals but will always

support and co-operate with measures taken to

protect and enhance the local environment.

This is demonstrated in practical ways.

• Customers and employees are made aware of

environmental issues and asked to act with

these in mind through guides, manuals and

training.

• Camping accommodation is non-permanent

and ‘low-rise’ and energy consumption is low.

An environmental audit confirmed that it is a

relatively ‘eco-friendly’ form of tourism.

• Our camping division recycles unwanted tents

and equipment in co-operation with various

charitable agencies.

• Explore Worldwide supports various conservation

organisations and third world community

projects and has recently received several awards

in recognition of its commitment to sustainable

tourism.

The Remuneration Committee presents this report toshareholders on behalf of the Board. Full details ofExecutive Director remuneration in the year to 30September 2001 along with details of directors’shareholdings and share options are given in note 6 to theAccounts (p30-33).

Pension Contributions The Company operates

contributory money purchase pension schemes for

the benefit of its executives and most other

employees. In all cases, basic salary only is

pensionable. Executives are able to increase pension

contributions through salary sacrifice and benefit

from a portion of the savings in National Insurance

charges. Pension contributions on behalf of

Executive Directors are 15% of base salary, before

any salary sacrifice element.

Share Options The Company believes that share

options are an important element in Executive

Director remuneration packages. This is particularly

so where the executive in question holds only a

limited number of Holidaybreak plc shares. Current

policy is to grant a moderate level of options on a

regular, annual basis. More information on the

Company’s share option schemes is given opposite.

Service Agreements

The Committee regards the stipulated notice periods

for its Executive Directors to be of mutual benefit.

The service agreement for the Group Chief Executive

currently provides for a two year notice period. This

is currently under review and agreement in principle

has been reached for the reduction of this notice

period to one year. No other agreements stipulate a

notice period of over one year.

In cases of early termination of contracts, subject to

legal constraints, the level of compensation will be

determined in accordance with two principles:

•Dealing fairly with the individual according to the

particular circumstances

•Taking full account of the departing executive’s

obligations to mitigate loss

Details of the service agreements of those directors

who retire by rotation at the 2002 Annual General

Meeting are given on page 16.

Sh a re SchemesThe Company currently operates three share

option schemes. There are also two share

incentive plans in existence, although neither is

currently being actively used. Further details of

the number of shares under option and details of

options currently held by executive directors are

given in note 6 to the Accounts (p30-33).

The issuing of new shares to satisfy share option

grants is limited by the rules of the various schemes

which restrict the level of total grants to a pre-

determined percentage of share capital, within

specified timescales. Where necessar y, the

Company acquires additional shares on the open

market to satisfy the grant of share options which it

wishes to make. Information on the schemes is

given below. With the exception of the Savings

Related Scheme, share options are not granted at a

discount to market value.

2001 Savings Related Share Option Scheme

This is an Inland Revenue approved scheme

whereby employees enter into a three or five year

savings contract with a maximum monthly savings

amount of £250 and a minimum of £5. On

maturity of the savings contract the employee is

able to exercise the options. The option price is set

at the commencement of the savings contract.

There are no performance criteria relating to this

scheme.

The Company offers the opportunity of

participation to all UK based permanent employees

at least once each year with an option price set at

20% below the prevailing market rate. Currently,

273 employees holding a total of 470,676 options

are participating in the scheme. A further 402,216

options have been exercised by 128 employees

since the introduction of the original scheme in

1991.

2001 Approved Company Share Option Plan

This scheme is subject to a £30,000 limit on the

value of options which may be granted to an

individual employee, in order to qualify for Inland

Revenue approval.

To be exercisable, options must normally be held for

at least three or five years, depending on the

performance measurement period applied to the

grant. They must be exercised within ten years of

date of grant. In the case of the Executive and

Divisional Directors, it is the Remuneration

Committee’s current policy to grant options subject

to performance conditions where growth in

earnings per share over the five years immediately

following grant must be at least 15% above the

increase in RPI over that period. For other

employees, growth in earnings per share must be at

least 6% above RPI over three years.

The Company’s policy has been to offer executive

share options fairly widely to senior and middle

management. Currently, 61 employees holding

691,436 options are participating in this and the

previous Inland Revenue approved scheme. A

further 644,033 options have been exercised by 33

employees since the original scheme’s inception in

1991.

1996 Unapproved Share Option Scheme

This scheme was introduced to allow the Company

to grant options which exceed the £30,000 value

limit for Inland Revenue approved schemes. The

scheme provides for two types of option (‘A’ and

‘B’). To be exercisable, ‘A’ options must be held for

at least three years. In the case of options granted

from 12 January 2000, they must be exercised

within ten years of date of grant, and growth in

earnings per share over three consecutive years

within the ten year period, must be at least 6%

above the increase in RPI o ver the same period.

‘A’ Options granted prior to 12 January 2000 must

be exercised within seven years of date of grant.

Together with grants under the 1991 Executive

Scheme and its successor, ‘A’ options up to a

combined value of four times salary can be granted

under the scheme rules, over a ten year period.

Grants of ‘B’ options are made to the Executive

Directors and a limited number of other senior

executives on a regular, annual basis. Per formance

criteria are significantly more demanding than for

‘A’ options. For ‘B’ options to be exercisable, the

increase in earnings per share over the five years

following the option grant must be at least 10%

above RPI growth over that period. In the case of

new grants this figure will increase to 15%. ‘B’

Options must be exercised within ten years of date

of grant. Under the terms of the scheme, over a ten

year period, grants of ‘B’ Options up to a combined

value of eight times salary can be made, including

grants made under other executive and other

discretionary schemes.

Currently, 44 employees holding 529,336 ‘A’

options are participating in the scheme and 17

employees hold 799,382 ‘B’ options. 223,403

scheme options have been exercised by 14

employees since its inception.

1997 Long Term Incentive Plan and 1997

Employee Incentive Plan The 1997 LTIP and EIP

schemes have, in the past, been used to facilitate

effective and tax efficient operation of Executive

Directors’ performance linked bonus schemes, a

portion of the bonuses being paid in shares held as

nil cost options (LTIP) or shares held in trust (EIP).

Neither scheme is currently being actively used and

the numbers of shares and share options involved is

small. The interests of Executive Directors in these

schemes is shown in note 6 to the Accounts (p.33).

C H McLintock

Remuneration Committee Chairman

10 Decemeber 2001

Holidaybreak plc

Page 22 Page 23

Remuneration

The Committee is responsible for determining the

remuneration packages of the Company’s Executive

Directors. In addition, it has a broader remit which

includes Executive Director performance, career

development and training requirements together

with stewardship of the Company’s share option

schemes.

Basic Salary Salaries are set taking into account

performance and appropriate comparatives in the

market place.

Performance Linked Bonus Bonuses are based on

one year performance criteria. Executive Directors

are able to earn a bonus of 35% of their base

salary on achievement of budget targets. A 10%

bonus is paid on achievement of 97% of budget.

No bonus is payable below that figure. The bonus

can rise to 65% of salary, but to reach this level

would require exceptional achievement,

substantially outperforming budget targets.

A review of remuneration policy is set out below.

In October 2000 the Committee commissioned a

comparative review of Executive Director

remuneration, which was carried out by Arthur

Andersen. The recommendations of this review

were taken fully into account when remuneration

packages for 2001 were agreed and were again

referred to in deliberations for 2002.

Scope and Objectives

Attracting, retaining and motivating directors and

senior management of appropriate calibre and

experience is essential to the Company’s future

success. The Remuneration Committee’s primar y

objective is to ensure that remuneration policy

supports this objective whilst avoiding unnecessary

cost.

Remuneration Policy

Executive Director remuneration packages consist

of various components:

• Basic salary

• Company car

• Performance linked bonus

• Private healthcare insurance

• Pension contributions

• Share options

• Life assurance

• Permanent health insurance

R e m u n e rat i o nCo m m i t tee Repo rtR e m u n e rat i o nCo m m i t tee Repo rt

Membership

The Remuneration Committee consists

of the Company’s three independent,

non-executive directors:

C. H. McLintock (Chairman)

H. A. Crichton-Miller

P. J. Folkman

NON-EXECUTIVE DIRECTOR

REMUNERATION

For non-executive directors other than the

Chairman, fees are reviewed annually. Proposals

are made to the Board following consultation

between the Chief Executive and Chairman. For the

Chairman, the Board will consider proposals put

forward by the Chief Executive following

consultation with the other directors and the

company’s professional advisors. Currently, the

Chairman’s fees are fixed for the three years of his

service agreement which expires on 1 June 2003.

Remuneration Committee, left to right:

Angus Crichton-Miller, Clive McLintock and

Peter Folkman

Holidaybreak plc

To the Shareholders of Holidaybreak plc:

We have audited the financial statements of Holidaybreak plc for the year

ended 30 September 2001 which comprise the Profit and Loss account, the

Balance Sheet, the Movement in Equity Shareholders’ Funds, the Cash Flow

Statement, the Statement of Total Recognised Gains and Losses and the related

notes numbered 1 to 24. These financial statements have been prepared under

the accounting policies set out therein.

Respective responsibilities of directors and auditors

The directors' responsibilities for preparing the Annual Report and the financial

statements in accordance with applicable law and United Kingdom Accounting

Standards are set out in the Directors' responsibilities on page 19. Our

responsibility is to audit the financial statements in accordance with relevant

legal and regulatory requirements, United Kingdom Auditing Standards and the

Listing Rules of the Financial Services Authority.

We report to you our opinion as to whether the financial statements give a true

and fair view and are properly prepared in accordance with the Companies Act

1985. We also report to you if, in our opinion, the Directors' Report is not

consistent with the financial statements, if the Company has not kept proper

accounting records, if we have not received all the information and explanations

we require for our audit, or if information specified by law or the Listing Rules

regarding directors' remuneration and transactions with the Company and other

members of the Group is not disclosed.

We review whether the Corporate Governance Statement reflects the Company’s

compliance with the seven provisions of the Combined Code specified for our

review by the Listing Rules, and we report if they do not. We are not required to

consider whether the Board’s statements on internal control cover all risks and

controls, or form an opinion on the effectiveness of the Group’s corporate

governance procedures or its risk and control procedures.

We read the other information contained in the Annual Report, including the

Corporate Governance Statement and consider whether it is consistent with the

audited financial statements. This other information comprises only the

Chairman's Statement and the Operating and Financial Review, Directors’

Report, Corporate Governance Statements, Remuneration Report, Statement of

Directors’ Responsibilities and Five-year summary. We consider the implications

for our report if we become aware of any apparent misstatements or material

inconsistencies with the financial statements. Our responsibilities do not extend

to any other information.

Basis of audit opinion

We conducted our audit in accordance with United Kingdom Auditing Standards

issued by the Auditing Practices Board. An audit includes examination, on a

test basis, of evidence relevant to the amounts and disclosures in the financial

statements. It also includes an assessment of the significant estimates and

judgements made by the directors in the preparation of the financial statements

and of whether the accounting policies are appropriate to the circumstances of

the Company and of the Group, consistently applied and adequately disclosed.

We planned and per formed our audit so as to obtain all the information and

explanations which we considered necessary in order to provide us with

sufficient evidence to give reasonable assurance that the financial statements

are free from material misstatement, whether caused by fraud or other

irregularity or error. In forming our opinion we also evaluated the overall

adequacy of the presentation of information in the financial statements.

Opinion

In our opinion the financial statements give a true and fair view of the state of

affairs of the Company and of the Group at 30 September 2001 and of the

Group’s profit for the year then ended and have been properly prepared in

accordance with the Companies Act 1985.

Arthur Andersen

Chartered Accountants and Registered Auditors

Bank House

9 Charlotte Street

Manchester

M1 4EU

10 December 2001

Page 24

R e po rt by the Au d i tors

Co n s o l i d ated profit and loss acco u nt for the year ended 30 September 2001

Page 25

2001 2000As restated

(see note 10)

Notes £’000 £’000

Turnover 1 192,489 164,518

Cost of sales (136,485) (116,210)__________ __________

Gross profit 56,004 48,308

Administrative expenses (31,496) (25,506)

Operating profit before goodwill amortisation and exceptional operating costs 26,674 23,667

Goodwill amortisation (1,703) (865)

Exceptional operating costs 4 (463) -__________ __________

Operating profit 24,508 22,802

Investment income 2 725 436

Interest payable and similar charges 3 (3,590) (3,394)__________ __________

Profit on ordinary activities before taxation 4 21,643 19,844

Tax on profit on ordinary activities 7 (6,289) (5,854)__________ __________

Profit on ordinary activities after taxation 15,354 13,990

Dividends paid and proposed 8 (8,343) (7,725)__________ __________

Retained profit for the year 21 7,011 6,265__________ __________

Earnings per ordinary share 9

Headline earnings per ordinary share 38.1p 34.0p

Basic earnings per ordinary share 33.4p 32.0p

Diluted headline earnings per ordinary share 37.5p 33.4p

Diluted basic earnings per ordinary share 32.8p 31.4p__________ __________

All activity is derived from continuing operations.

The accompanying notes are an integral part of this consolidated profit and loss account.

R e co n c i l i ation of move m e nts in Group share h o l d e r s’ funds for the year ended 30 September 2001

2001 2000As restated

(see note 10)

£’000 £’000

Profit on ordinary activities after taxation 15,354 13,990

Dividends paid and proposed (8,343) (7,725)

__________ __________

7,011 6,265

New share capital subscribed 1,122 12,162

Exchange differences (52) (288)__________ __________

Net addition to shareholders’ funds 8,081 18,139

Opening equity shareholders’ funds (2000 - originally £6,681,000, restated for prior year adjustment of £4,907,000) 19,913 1,774

__________ __________

Closing equity shareholders’ funds 27,994 19,913__________ __________

Group Company________________________ _______________________

2001 2000 2001 2000As restated

Notes (see note 10)

£’000 £’000 £’000 £’000

Fixed assets

Intangible assets – goodwill 11 31,600 32,753 - -

Tangible assets 12 57,728 53,779 - -

Investments 13 1,896 1,079 129,956 129,956__________ __________ __________ __________

91,224 87,611 129,956 129,956__________ __________ __________ __________

Current assets

Assets held for disposal 14 2,626 3,463 1,000 1,106

Debtors 15 13,421 12,690 12,166 7,920

Cash at bank and in hand 49,169 47,803 - 192

__________ __________ __________ __________

65,216 63,956 13,166 9,218__________ __________ __________ __________

Creditors: Amounts falling due within one year 16 (61,925) (52,553) (25,214) (8,110)__________ __________ __________ __________

Net current assets (liabilities) 3,291 11,403 (12,048) 1,108__________ __________ __________ __________

Total assets less current liabilities 94,515 99,014 117,908 131,064

Creditors: Amounts falling due after more than one year 17 (60,499) (73,619) (45,500) (60,000)

Provisions for liabilities and charges 19 (6,022) (5,482) - -__________ __________ __________ __________

Net assets 27,994 19,913 72,408 71,064__________ __________ __________ __________

Capital and reserves

Called-up share capital 20 2,317 2,290 2,317 2,290

Share premium account 21 28,728 27,411 69,819 68,502

Other reserves 21 87 87 87 87

Profit and loss account 21 (3,138) (9,875) 185 185

__________ __________ __________ __________

Equity shareholders’ funds 27,994 19,913 72,408 71,064__________ __________ __________ __________

Signed on behalf of the Board

R.W. AtkinsonDirector

10 December 2001

The accompanying notes are an integral part of these balance sheets.

2001 2001 2000 2000Notes £’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

Net cash inflow from operating activities 22 39,684 39,726

Returns on investments and servicing of finance

Interest received 725 436

Interest paid (1,772) (2,082)

Interest element of hire purchase payments (1,445) (1,312)__________ __________

(2,492) (2,958)

Taxation

UK Taxation paid (6,482) (3,964)

Overseas Taxation paid (1,118) (1,116)__________ __________

(7,600) (5,080)

Capital expenditure

Purchase of own shares (822) (1,059)

Sale (purchase) of other investments 5 (20)

Purchase of tangible fixed assets (9,839) (9,371)

Receipts from sale of tangible fixed assets 2,936 5,015__________ __________

(7,720) (5,435)

Acquisitions and disposals

Purchase of subsidiary under takings (net of cash acquired) 13 - (7,843)__________ __________

- (7,843)

Equity dividends paid (7,639) (6,569)__________ __________

Cash inflow before management of liquid resources and financing 14,233 11,841

Financing

Issue of ordinary share capital 1,122 560

(Decrease) increase in loans 23 (8,500) 16,535

Capital element of hire purchase payments 23 (7,213) (6,776)__________ __________

(14,591) 10,319__________ __________

(Decrease) increase in cash in the year 23 (358) 22,160__________ __________

The accompanying notes are an integral part of this consolidated cash flow statement.

Co n s o l i d ated state m e nt of total re cognised gains and losses for the year ended 30 September 2001

2001 2000

As restated(see note 10)

£’000 £’000

Profit for the financial year 15,354 13,990

Loss on foreign cur rency translation (52) (288)__________ __________

Total recognised gains and losses relating to the year 15,302 13,702__________ __________

Prior year adjustment (see note 10) (4,907)__________

Total gains and losses recognised since last annual report and financial statements 10,395__________

Ho l i d ayb reak plc

Ba l a n ce sheets for the year ended 30 September 2001 Co n s o l i d ated cash flow state m e nt for the year ended 30 September 2001

Page 26 Page 27

The principal Group accounting policies, all of which have been appliedconsistently throughout the current year and the preceding year, with theexception of the policy for deferred taxation, are set out below.

Basis of accountingThe financial statements have been prepared under the historical cost conventionand in accordance with applicable accounting standards.

Basis of consolidationThe Group financial statements consolidate the accounts of Holidaybreak plc andits subsidiary under takings for the year to 30 September 2001.

No profit and loss account is presented for Holidaybreak plc, as permitted bySection 230 of the Companies Act 1985. The company’s profit after tax for theyear, determined in accordance with the Act, was £8,343,000 (year ended 30September 2000 - £7,842,000).

Intangible assets - goodwillGoodwill arising on consolidation, representing the excess of the fair value of theconsideration given over the fair value of the separate net assets acquired, iscapitalised and written off on a straight line basis over its useful economic life,which is assumed to be 20 years. Goodwill arising on acquisitions prior to 1October 1999 was written off to reserves in accordance with the accountingstandard then in force. As permitted by FRS10 the goodwill previously writtenoff to reserves has not been reinstated in the balance sheet. On disposal of apreviously acquired business, the attributable amounts of goodwill previouslywritten off to reserves is included in determining the profit or loss on disposal.

InvestmentsIn the Company’s balance sheet, investments in subsidiary undertakings arestated at cost. Provisions for temporary fluctuations in value are not made. Onlydividends received and receivable are credited to the Company’s profit and lossaccount.

Tangible fixed assetsAll tangible fixed assets are shown at cost.

Depreciation is provided using the straight-line method at rates calculated towrite off the cost less estimated residual value of each asset over its expecteduseful economic life, as follows:

Freehold land and buildings 50 yearsShort leasehold improvements Term of leaseCamping equipment 2-5 yearsMobile homes 10 yearsOffice equipment and motor vehicles 4-5 years

Profits or losses on the disposal of tangible fixed assets are included in thecalculation of operating profit.

TaxationCurrent tax, including UK corporation tax and foreign tax, is provided at amountsexpected to be paid (or recovered) using the tax rates and laws that have beenenacted or substantially enacted by the balance sheet date.

Deferred tax is recognised in respect of all timing differences that haveoriginated but not reversed at the balance sheet date where transactions orevents that result in an obligation to pay more tax in the future or a right to payless tax in the future have occurred at the balance sheet date. Timingdifferences are differences between the Group’s taxable profits and its results asstated in the financial statements that arise from the inclusion of gains andlosses in tax assessments in periods different from those in which they arerecognised in the financial statements.

Taxation (continued)A net deferred tax asset is regarded as recoverable and therefore recognised onlywhen, on the basis of all available evidence, it can be regarded as more likelythan not that there will be suitable taxable profits from which the future reversalof the underlying timing differences can be deducted.

Deferred tax is not recognised when fixed assets are revalued unless by thebalance sheet date there is a binding agreement to sell the revalued assets andthe gain or loss expected to arise on sale has been recognised in the financialstatements. Neither is deferred tax recognised when fixed assets are sold and itis more likely than not that the taxable gain will be rolled over, being charged totax only if and when the replacement assets are sold.

Deferred tax is recognised in respect of the retained earnings of overseassubsidiaries and associates only to the extent that, at the balance sheet date,dividends have been accrued as receivable or a binding agreement to distributepast earnings in future has been entered into by the subsidiary or associate.

Deferred tax is measured at the average tax rates that are expected to apply inthe periods in which the timing differences are expected to reverse, based on taxrates and laws that have been enacted or substantively enacted by the balancesheet date. Deferred tax is measured on a non-discounted basis.

Pension costsThe Group provides pensions to directors and senior employees through definedcontribution pension schemes. The assets of the schemes are held independentlyof the Group by an insurance company. The amount charged to the profit andloss account is the contributions payable in the year.

Foreign currencyTransactions denominated in foreign currencies are recorded in the local cur rencyat actual exchange rates which are largely based on forward exchange contracts.

Monetary assets and liabilities denominated in foreign currencies at the periodend are reported at the rates of exchange prevailing at the period end or, whereappropriate, at the rate of exchange in a related forward exchange contract. Anygain or loss arising from a change in exchange rates subsequent to the date ofthe transaction is included as an exchange gain or loss in the profit and lossaccount.

The results of overseas operations are translated at the average rates of exchangeduring the period and their balance sheets at the rates ruling at the balancesheet date. Exchange differences arising on translation of the opening net assetsand results of overseas operations and on foreign currency borrowings, to theextent that they hedge the group’s investment in such operations, are dealt withthrough reserves.

Hire purchase agreements and leasesAssets acquired under hire purchase agreements are initially reported at the fairvalue of the asset with an equivalent liability categorised as appropriate undercreditors due within or after one year. The asset is depreciated over its usefuleconomic life. Finance charges are allocated to accounting periods over theperiod of the agreement to produce a constant rate of charge on the outstandingbalance. Rentals are apportioned between finance charges and reduction of theliability. Rentals under operating leases are charged on a straight-line basis overthe lease term.

TurnoverTurnover comprises the sales of holidays and other travel services provided by theGroup, excluding VAT and similar taxes.

Derivatives and other financial instrumentsDetails of all derivatives and other financial instruments are covered in note 18to the accounts.

1 Segment information 2001 2000Group turnover by geographical origin was as follows: £’000 £’000_____________________________________________________________________________________________________________________

United Kingdom and Ireland 158,989 130,732

Netherlands and Belgium 15,659 15,939

Germany, Switzerland and Austria 13,650 14,126

Others 4,191 3,721__________ __________

192,489 164,518__________ __________

Group turnover and operating profit before exceptional operating costs and goodwill amortisation by class of business was as follows

Turnover Operating profit before exceptional operating costsand goodwill amortisation

_______________________ _______________________

2001 2000 2001 2000 £’000 £’000 £’000 £’000

Camping 103,691 102,357 17,833 17,001

Hotel Breaks 57,768 46,054 5,466 4,390

Adventure Holidays 31,030 16,107 3,375 2,276__________ __________ __________ __________

192,489 164,518 26,674 23,667 __________ __________ __________ __________

Analyses of operating profit by geographic area and net assets by geographical area and class of business have not been disclosed as the directors believethat publication of such information would be seriously prejudicial to the interests of the Group.

2 Investment income

Investment income comprises: 2001 2000£’000 £’000

_____________________________________________________________________________________________________________________

Bank interest receivable 725 436__________ __________

3 Interest payable and similar charges

2001 200£’000 £’000

_____________________________________________________________________________________________________________________

Bank loans and overdrafts 2,167 2,082

Hire purchase contracts 1,423 1,312__________ __________

3,590 3,394__________ __________

4 Profit on ordinary activities before taxation

2001 200Profit on ordinary activities before taxation is stated after charging: £’000 £’000_____________________________________________________________________________________________________________________

Depreciation and amounts written off tangible fixed assets

- owned 8,186 8,318

- held under hire purchase contracts 3,508 2,964

Hire of plant and machinery under operating leases 250 231

Other operating lease rentals 484 744

Auditors’ remuneration - audit 123 111

- non-audit 84 66

Exceptional operating costs 463 -

Staff costs (see note 5) 19,708 16,918__________ __________

Exceptional operating costs of £463,000 were incurred following the collapse of the company’s insurers, Independent Insurance plc, in June 2001.These costs include additional insurance premiums and a provision for potential future claims.

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5 Staff costs

Particulars of employees (including executive directors) are as shown below:

2001 2000

Employee costs during the year amounted to: £’000 £’000_____________________________________________________________________________________________________________________

Wages and salaries 17,890 15,398

Social security costs 1,303 1,072

Pension costs 515 448 __________ __________

19,708 16,918__________ __________

2001 2000

The average monthly number of persons employed by the Group during the year was as follows: Number Number employed employed

_____________________________________________________________________________________________________________________

Management and administration 715 628

Couriers 897 826 __________ __________

1,612 1,454 __________ __________

The Group operates an Inland Revenue approved employee share option scheme and has taken advantage of the exemption given in UITF Abstract 17,"Employee Share Schemes" from recognising a charge in the profit and loss account for the discount on the options.

6 Directors’ remuneration, interests and transactions

Directors’ remuneration: Gain on Performance exercise

Salaries/ Taxable related of share Pension Total Total fees benefits bonus options contributions 2001 2000

£’000 £’000 £’000 £’000 £’000 £’000 £’000_____________________________________________________________________________________________________________________

Executive:

R.W. Atkinson 206 9 74 125 31 445 301

R.G. Baddeley 114 12 40 134 17 317 180

T.V. Cox (resigned 1 January 2001) 68 1 - - - 69 75

J.R. Crew 144 11 53 - 22 230 246

N.P. Cust 85 12 46 155 29 327 150

S.J.Tobin (appointed 1 January 2001) 91 9 - 67 14 181 -

M.C. Wray 86 10 46 89 28 259 148

Non-executive:

H.A. Crichton-Miller 50 - - - - 50 33

P.J. Folkman 17 - - - - 17 15

C.H. McLintock 17 - - - - 17 15_________ _________ _________ _________ _________ _________ _________

Aggregate emoluments 878 64 259 570 141 1,912 1,163 _________ _________ _________ _________ _________ _________ _________

Total 2000 665 44 274 73 107 1,163 _________ _________ _________ _________ _________ _________

There have been no changes in the directors since the year end.

Pension contributions for six directors (2000 - five directors) were paid to money purchase schemes.

No emoluments have been waived by the directors (2000 - £nil).

During the year the highest paid director received emoluments, excluding pension contributions, of £414,000 (2000 - £259,000).

6 Directors’ remuneration, interests and transactions (continued)

Directors’ interests:

The directors’ interests in the share capital of the Company, all of which are beneficial, were as follows:

30 September 2001 30 September 2000 or date of appointment if later_________________________ _______________________

Number of Number of Number of Number of ordinary 5p options ordinary 5p options

shares shares_____________________________________________________________________________________________________________________

H.A. Crichton-Miller 50,000 - 50,000 -

R.W. Atkinson 774,159 140,299 774,159 117,424

R.G. Baddeley 11,237 190,701 7,258 199,551

J.R. Crew 53,154 150,197 113,154 97,427

N.P. Cust 1,076 102,586 1,076 139,401

P.J. Folkman 20,200 - 20,200 -

C.H. McLintock 8,000 - 8,000 -

S.J. Tobin (appointed 1 January 2001) - 78,531 - -

M.C. Wray 6,076 139,334 1,076 151,245

In addition to the above beneficial interests, R.W. Atkinson and R.G. Baddeley, as directors of Holidaybreak Trustee Limited, have a non-beneficial interest in 627,519, (2000 - 377,519) ordinary 5p shares which are held by Holidaybreak Trustee Limited as trustee of the Holidaybreak Employee Share Trust. The shares are held on behalf of participants in the Company’s Share Option Schemes and Share Award Plans. Shares held by the Trust on behalf of thedirectors are declared in the above beneficial interests.

On 5 October 2001 R. W. Atkinson purchased 6,634 ordinary 5p shares in Holidaybreak plc under the 1991 Savings Related Share Option Scheme at a price of 156.0p per share. The market price of the Holidaybreak plc 5p ordinary shares on 5 October 2001 was 382.5p. None of the directors has anyother interests requiring disclosure under the Companies Act 1985.

Directors’ share options:

Market Option At 1 Granted Exercised Date price on At 30 normally

October during during option date of September Option exercisable Expiry2000 year year exercised exercise 2001 price from date

or date ofappointment

if later

1991 Executive (Performance Related) Share Option Scheme_____________________________________________________________________________________________________________________

R.W. Atkinson 50,000 - 50,000 14 Jun 2001 459.0p - 210.0p

R.G. Baddeley 50,000 - - 50,000 253.0p 30 Mar 1988 30 Mar 2005

R.G. Baddeley 50,000 - - 50,000 210.0p 14 Aug 1998 14 Aug 2005

J.R. Crew 40,000 - - 40,000 308.0p 27 July 1995 27 July 2002

N.P. Cust 50,000 - 50,000 22 May 2001 411.0p - 210.0p

N.P. Cust 18,072 - 18,072 22 May 2001 411.0p - 166.0p

S.J. Tobin 15,384 - 15,384 29 Sep 2001 362.5p - 195.0p

M.C. Wray 50,000 - 25,000 22 May 2001 411.0p 25,000 210.0p 14 Aug 1998 14 Aug 2005

M.C. Wray 18,072 - 10,000 22 May 2001 411.0p 8,072 166.0p 2 Sep 1999 2 Sep 2006

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6 Directors’ remuneration, interests and transactions (continued)

Directors’ share options: (continued)

Market Option At 1 Granted Exercised Date price on At 30 normally

October during during option date of September Option exercisable Expiry2000 year year exercised exercise 2001 price from date

or date ofappointment

if later

1996 Unapproved Share Option Scheme (‘A’ Options) _____________________________________________________________________________________________________________________

R.G. Baddeley 46,084 - 46,084 7 Sep 2001 450.0p - 166.0p

R.G. Baddeley 10,000 - - 10,000 195.0p 29 Sep 2001 29 Sep 2005

J.R. Crew 10,000 - - 10,000 195.0p 29 Sep 2001 29 Sep 2005

N.P. Cust 1,928 - 1,928 22 May 2001 411.0p - 166.0p

N.P. Cust 25,000 - - 25,000 242.5p 2 July 2000 2 July 2004

N.P. Cust 10,000 - - 10,000 195.0p 29 Sep 2001 29 Sep 2005

S.J. Tobin 24,616 - 24,616 29 Sep 2001 362.5p - 195.0p

S.J. Tobin 20,000 - - 20,000 276.5p 30 June 2002 30 June 2006

M.C. Wray 1,928 - - 1,928 166.0p 2 Sep 1999 2 Sep 2003

M.C. Wray 25,000 - - 25,000 242.5p 2 July 2000 2 July 2004

M.C. Wray 10,000 - - 10,000 195.0p 29 Sep 2001 29 Sep 2005

1996 Unapproved Share Option Scheme (‘B’ Options) _____________________________________________________________________________________________________________________

R.W. Atkinson 55,000 - - 55,000 315.0p 8 Mar 2005 8 Mar 2010

R.W. Atkinson - 31,763 - 31,763 287.5p 27 Dec 2005 27 Dec 2010

R.W. Atkinson - 38,161 - 38,161 325.0p 27 Dec 2005 27 Dec 2010

R.G. Baddeley 33,333 - - 33,333 315.0p 8 Mar 2005 8 Mar 2010

R.G. Baddeley - 17,404 - 17,404 287.5p 27 Dec 2005 27 Dec 2010

R.G. Baddeley - 20,888 - 20,888 325.0p 27 Dec 2005 27 Dec 2010

J.R. Crew 41,269 - - 41,269 315.0p 8 Mar 2005 8 Mar 2010

J.R. Crew - 22,691 - 22,691 287.5p 27 Dec 2005 27 Dec 2010

J.R. Crew - 27,255 - 27,255 325.0p 27 Dec 2005 27 Dec 2010

N.P. Cust 28,571 - - 28,571 315.0p 8 Mar 2005 8 Mar 2010

N.P. Cust 15,120 - 15,120 287.5p 27 Dec 2005 27 Dec 2010

N.P. Cust 18,176 - 18,176 325.0p 27 Dec 2005 27 Dec 2010

S.J. Tobin 20,238 - - 20,238 315.0p 8 Mar 2005 8 Mar 2010

S.J. Tobin 17,404 - - 17,404 287.5p 27 Dec 2005 27 Dec 2010

S.J. Tobin 20,888 - - 20,888 325.0p 27 Dec 2005 27 Dec 2010

M.C. Wray 28,571 - - 28,571 315.0p 8 Mar 2005 8 Mar 2010

M.C. Wray 15,120 - 15,120 287.5p 27 Dec 2005 27 Dec 2010

M.C. Wray 18,176 - 18,176 325.0p 27 Dec 2005 27 Dec 2010

6 Directors’ remuneration, interests and transactions (continued)

Directors’ share options: (continued)

Market Option At 1 Granted Exercised Date price on At 30 normally

October during during option date of September Option exercisable Expiry2000 year year exercised exercise 2001 price from date

or date ofappointment

if later

1991 Savings Related Share Option Scheme _____________________________________________________________________________________________________________________

R.W. Atkinson 6,634 - - 6,634 156.0p 1 Oct 2001 1 Apr 2002

R.W. Atkinson 2,857 - - 2,857 241.5p 1 Sep 2003 1 Mar 2004

R.G. Baddeley 2,041 - 2,041 19 Dec 2001 334.5p -

R.G. Baddeley 3,479 - - 3,479 194.0p 1 Mar 2004 1 Sep 2004

R.G. Baddeley 2,678 - - 2,678 252.0p 1 Sep 2005 1 Mar 2006

J.R. Crew 4,037 - - 4,037 241.5p 1 Sep 2001 1 Mar 2002

N.P. Cust 3,062 - 3,062 15 Dec 2001 333.5p -

N.P. Cust 1,997 - - 1,997 194.0p 1 Mar 2002 1 Sep 2002

M.C. Wray 10,207 - 10,207 6 Dec 2001 307.0p -

M.C. Wray 6,696 - - 6,696 252.0p 1 Sep 2005 1 Mar 2006

2001 Savings Related Share Option Scheme _____________________________________________________________________________________________________________________

R.W. Atkinson - 2,951 - 2,951 343.0p 1 Oct 2006 1 Apr 2007

R.G. Baddeley - 983 - 983 343.0p 1 Oct 2006 1 Apr 2007

J.R. Crew - 2,824 - 2,824 343.0p 1 Oct 2004 1 Apr 2005

N.P. Cust - 2,951 - 2,951 343.0p 1 Oct 2006 1 Apr 2007

1997 Long Term Incentive Plan _____________________________________________________________________________________________________________________

R.W. Atkinson 2,933 - - 2,933 Nil cost 1 Nov 2000 22 Dec 2004

R.G. Baddeley 1,936 - - 1,936 Nil cost 1 Nov 2000 22 Dec 2004

J.R. Crew 2,121 - - 2,121 Nil cost 1 Nov 2000 22 Dec 2004

N.P. Cust 771 - - 771 Nil cost 1 Nov 2000 22 Dec 2004

M.C. Wray 771 - - 771 Nil cost 1 Nov 2000 22 Dec 2004

Details of share awards are as follows:

1997 Employee Incentive Plan At Share awards At 30 Market price Price Period during 1 October made during September on date of paid per which shares

2000 period 2001 share award share held in trust _____________________________________________________________________________________________________________________

R.W. Atkinson 3,726 - 3,726 308.0p Nil 1 Oct 1999 to 30 Sept 2002

R.G. Baddeley 2,258 - 2,258 308.0p Nil 1 Oct 1999 to 30 Sept 2002

J.R. Crew 3,797 - 3,797 308.0p Nil 1 Oct 1999 to 30 Sept 2002

N.P. Cust 584 - 584 308.0p Nil 1 Oct 1999 to 30 Sept 2002

M.C. Wray 584 - 584 308.0p Nil 1 Oct 1999 to 30 Sept 2002

Further details of share schemes, their relevant performance conditions and maximum awards permitted are contained in the Remuneration Committee Report which can be found on pages 22 to 23 of the report and accounts.

The middle market price of the ordinary shares at 30 September 2001 was 362.5p and the range during the year was 273.5p to 474.5p.

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7 Tax on profit on ordinary activitiesThe tax charge comprises: 2001 2000

As restated(see note 10)

£’000 £’000_____________________________________________________________________________________________________________________

UK corporation tax

- charge for the year 4,658 5,301

- overprovision in respect of prior years - (1,038)

Foreign taxation 1,091 1,090__________ __________

5,749 5,353

Deferred taxation (see note 19) 540 501__________ __________

6,289 5,854 __________ __________

The difference between the total current tax shown above and the amount calculated by applying the standard rate of UK corporation tax is as follows:

Group profit on ordinary activities before tax 21,643 19,844

__________ __________

Tax on Group profit on ordinary activities at standard UK corporation tax rate of 30% (2000 - 30%) 6,493 5,953

Effects of:

Capital allowances in excess of depreciation (540) (501)

Other timing differences (204) (99)

__________ __________

5,749 5,353

__________ __________

8 Dividends paid and proposed 2001 2000 £’000 £’000

_____________________________________________________________________________________________________________________

Under provision in respect of final dividend 13 406

Interim dividend paid of 5.4p per ordinary share (2000 - 4.8p) 2,497 2,190

Final dividend proposed of 12.6p per ordinary share (2000 - 11.2p) 5,833 5,129

__________ __________

8,343 7,725 __________ __________

9 Earnings per ordinary share

Headline earnings per share are based on Group profit on ordinary activities, after taxation, but before exceptional operating costs and goodwill amortisation, of £17,520,000 (2000 - £14,855,000, as restated). The directors consider that this gives a better understanding of the Group’s earnings following the change in the accounting treatment of goodwill in 2000.

Basic earnings per ordinary share are based on Group profit on ordinary activities, after taxation, of £15,354,000 (2000 - £13,990,000, as restated) and on 45,991,047 average ordinary shares in issue, weighted on a time basis (2000 - 43,531,036). Diluted earnings per ordinary share (basic and headline) are calculated on the basis of the weighted average ordinary shares in issue increased by the weighted average of all ordinary shares under option which represent all potentially dilutive ordinary shares. The total potential weighted average ordinary shares in issue, weighted on a time basis, was 46,744,141 (2000 - 44,357,023).

10 Prior year adjustmentThe Directors have adopted FRS 19, "Accounting for Deferred Taxation", during the year. This has resulted in an increase in the deferred tax liability recognised, arising due to timing differences, of £4,907,000 at 1 October 1999. Profit after tax has reduced by £10,000 on the year ended 30 September 2001 as a result of this change in policy (2000 - an increase of £46,000 in profit after taxation).

As a result, comparative figures for the year ended 30 September 2000 have been adjusted as follows:

Profit forthe year

after Netdividends assets

£’000 £’000_____________________________________________________________________________________________________________________

As previously reported 6,219 24,774

Impact of implementation of FRS 19 46 (4,861)__________ __________

As restated 6,265 19,913__________ __________

11 Intangible assets - goodwill Group£’000

_____________________________________________________________________________________________________________________

Cost

As at 1 October 2000 33,618

Adjustment 550__________

As at 30 September 2001 34,168__________

Amortisation

As at 1 October 2000 865

Charge for the year 1,703__________

As at 30 September 2001 2,568__________

Net Book Value at 30 September 2001 31,600__________

Net Book Value at 30 September 2000 32,753 __________

The adjustment to goodwill relates to a re-assessment of the fair value of assets and liabilities acquired when the company purchased Explore Worldwide Limited on 17 February 2000 and Regal Diving & Tours Limited on 4 August 2000.

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12 Tangible fixed assets Office

Freehold Short equipment land and leasehold Camping Mobile and motor buildings improvements equipment homes vehicles Total

£’000 £’000 £’000 £’000 £’000 £’000_____________________________________________________________________________________________________________________

Cost

At 1 October 2000 3,887 734 14,356 52,938 6,558 78,473

Additions 27 8 5,755 11,195 1,071 18,056

Transfer to current assets - - - (3,863) - (3,863)

Disposals - - (5,195) (1,892) (483) (7,570)

__________ __________ __________ __________ _________ __________

At 30 September 2001 3,914 742 14,916 58,378 7,146 85,096__________ __________ __________ __________ _________ __________

Depreciation

At 1 October 2000 285 438 6,933 13,317 3,721 24,694

Charge 78 34 4,828 5,681 1,073 11,694

Transfer to current assets - - - (2,237) - (2,237)

Disposals - - (5,195) (1,186) (402) (6,783)

__________ __________ __________ __________ _________ __________

At 30 September 2001 363 472 6,566 15,575 4,392 27,368__________ __________ __________ __________ _________ __________

Net book value

At 30 September 2001 3,551 270 8,350 42,803 2,754 57,728

__________ __________ __________ __________ _________ __________

At 30 September 2000 3,602 296 7,423 39,621 2,837 53,779

__________ __________ __________ __________ _________ __________

Included within mobile homes are assets under hire purchase contracts with a net book value of £30,028,600 (2000 - £26,551,000).

13 Fixed asset investments Group Company

________________________ _______________________

2001 2000 2001 2000 £’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

Subsidiary undertakings - - 129,956 129,956

Holidaybreak plc ordinary shares held under trust 1,881 1,059 - -

Other investments 15 20 - -

__________ __________ __________ __________

1,896 1,079 129,956 129,956__________ __________ __________ __________

13 Fixed asset investments (continued)

Principle Group investmentsThe Company and the Group have investments in the following subsidiary undertakings which principally affected the profits and net assets of the Group. To avoid a statement of excessive length, details of investments which are not significant have been omitted.

The principal subsidiary undertakings of Holidaybreak plc are as follows:

Country of incorporation Proportion of share capital Proportion of share capitaland operation held by the Company (%) held by the Group (%)

_____________________________________________________________________________________________________________________

Camping operators:Eurocamp Travel Limited England 100Sunsites Limited England 100Keyline Continental Limited England 100Keycamp Holidays (Ireland) Limited Ireland 100

Hotel short-break operator:Superbreak Mini-Holidays Limited England 100

Agency companies:Eurocamp Travel GmbH Germany 100Eurocamp Travel (Schweiz) AG Switzerland 100Camping in Comfort BV Netherlands 100Keycamp Holidays Netherlands BV Netherlands 100

Adventure holidays:Explore Worldwide Limited England 100Explore Aviation Limited England 100Regal Diving & Tours Limited England 100

Holding and other companies:Superbreak Mini-Holidays Group Limited England 100Eurocamp Travel B.V Netherlands 100Camping Division Limited England 100Explore Limited England 100Eurocamp Air Travel Limited England 100Holidaybreak Trustee Limited England 100

Own shares Group

£’000

Cost and net book value

At 1 October 2000 1,059

Additions 822__________

At 30 September 2001 1,881__________

Own shares held under trust:

Shares of the Company are held under trust by Holidaybreak Trustee Limited (a wholly owned subsidiary of Holidaybreak plc) for the benefit of participants in the Holidaybreak plc Long Term Incentive Plan, Holidaybreak plc Share Award Plan, Holidaybreak plc Employee Incentive Plan and Holidaybreak plc Executive Share Option Schemes.

During the year Holidaybreak Trustee Limited has purchased 250,000 ordinary 5p shares in Holidaybreak plc.

On 17 February 2000, the Company acquired 100% of the issued share capital of Explore Worldwide Limited and on 4 August 2000 acquired 100% of the issued share capital of Regal Diving & Tours Limited. On 17 July 2000, Superbreak Mini-Holidays Limited acquired the business of Hotelnet and on 28 September 2000 it acquired the business of Rainbow Holidays. The total consideration was £36,230,000. Net outflows of cash in respect of these additions were:

2000 £’000

_____________________________________________________________________________________________________________________

Cash consideration 14,140

Cash at bank and in hand acquired (6,297)__________

7,843__________

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14 Assets held for disposal Group Company

________________________ _______________________

2001 2000 2001 2000£’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

Other investments held for disposal 1,000 1,106 1,000 1,106

Mobile homes held for disposal 1,626 2,357 - -__________ __________ __________ __________

2,626 3,463 1,000 1,106 __________ __________ __________ __________

Other investments held for disposal are preference shares in the former printing businesses of Baldwin Limited.

Mobile homes for disposal are stated at net realisable value.

15 Debtors

Amounts falling due within one year: Group Company

________________________ _______________________

2001 2000 2001 2000£’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

Trade debtors 6,344 6,225 - -

Amounts owed by subsidiary under takings - - 11,448 7,448

VAT receivable and other debtor s 3,521 2,807 349 16

Prepayments 3,556 3,658 369 456__________ __________ __________ __________

13,421 12,690 12,166 7,920 __________ __________ __________ __________

16 Creditors: Amounts falling due within one year

Group Company________________________ _______________________

2001 2000 2001 2000£’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

Obligations under hire purchase contracts 6,535 7,128 - -

Bank loans and overdrafts 7,883 159 7,443 -

Amounts owed to subsidiary under takings - - 11,938 2,884

Payments received on account 3,123 2,437 - -

Trade creditors 15,820 12,344 - -

Corporation tax 4,168 6,006 - -

Other creditors 3,994 3,131 - -

Social security and PAYE 390 331 - -

Dividends payable 5,833 5,129 5,833 5,129

Accruals and deferred income 14,179 15,888 - 97__________ __________ __________ __________

61,925 52,553 25,214 8,110__________ __________ __________ __________

17 Creditors: Amounts falling due after more than one year Group Company

________________________ _______________________

2001 2000 2001 2000£’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

Obligations under hire purchase agreements 14,315 12,719 - -

Bank loan 36,035 50,535 36,035 50,535

Loan notes 9,465 9,465 9,465 9,465

Other creditors 684 900 - -__________ __________ __________ __________

60,499 73,619 45,500 60,000 __________ __________ __________ __________

Borrowings are repayable as follows: Group Company________________________ _______________________

2001 2000 2001 2000£’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

Hire purchase agreements: -

Within 1 year 6,535 7,128 - -

Within 1-2 years 5,077 5,371 - -

Within 2-5 years 9,238 7,348 - -

Bank loan and loan notes:

Within 1 year 7,883 159 7,443 -

Within 1-2 years 33,500 32,535 33,500 32,535

Within 2-5 years 12,000 18,000 12,000 18,000

Over 5 years - 9,465 - 9,465__________ __________ __________ __________

Total borrowings 74,233 80,006 52,943 60,000 __________ __________ __________ __________

The bank loan and loan notes are secured by a fixed and floating charge over the Group’s assets.

18 Derivatives and other financial instruments

Page 7 of the Operating and Financial Review provides an explanation of the role that financial instruments have had during the period creating or changing the risks the Group faces in its activities. The explanation summarises the objectives and policies for holding or issuing financial instruments and similar contracts, and the strategies for achieving those objectives that have been followed during the period.

The numerical disclosures in this note deal with financial assets and financial liabilities as defined in Financial Reporting Standard 13 "Derivatives and Other Financial Instruments: Disclosures" (FRS 13). Cer tain financial assets such as investments in subsidiary and associated companies are excluded from the scope of these disclosures.

As permitted by FRS 13, short term debtors and creditors have been excluded from the disclosures, other than the currency disclosures.

Financial assets

The Group has no financial assets other than the following cash deposits: 2001 2000£’000 £’000

_____________________________________________________________________________________________________________________

Sterling 46,793 43,132

Euros 1,398 3,228

US dollars 978 1,443__________ __________

49,169 47,803__________ __________

The deposits form part of the normal financing arrangements of the Group and include deposits placed on money market at call, seven day and monthly rates.

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18 Derivatives and other financial instruments (continued)Financial liabilities

After taking into account interest rate swaps entered into by the Group, the interest rate profile of the Group’s financial liabilities is as follows:

2001 2000£’000 £’000

_____________________________________________________________________________________________________________________

Fixed rate 29,206 22,603

Floating rate 45,027 57,403__________ __________

74,233 80,006__________ __________

Analysis of the fixed interest rate profile is as follows:

Weighted average fixed interest rate (%) 6.0 7.0Weighted average period for which rate is fixed (years) 2.7 2.1

The interest rate on floating rate bank loans is linked to one-month and six-month LIBOR in the case of sterling liabilities and the interest rate on floating rate hire purchase loans is linked to a mixture of bank base rate and three-month LIBOR.

The maturity profile of the Group’s financial liabilities is set out in notes 16 and 17.

Currency exposuresAs at 30 September 2001 the Group had no material currency exposure after taking into account the various forward contracts held at the year end.

Fair values There is no material difference between the book values and fair values of the Group’s financial assets and liabilities at 30 September 2001.

19 Provisions for liabilities and charges

Group Company________________________ _______________________

2001 2000 2001 2000As restated

(see note 10)£’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

Deferred taxation - accelerated capital allowances 6,022 5,482 - -__________ __________ __________ __________

The movement during the year was as follows:

Group Company________________________ _______________________

2001 2000 2001 2000As restated

(see note 10)£’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

At 1 October 2000 5,482 4,981 - -

Charged to profit and loss account 540 501 - -__________ __________ __________ __________

At 30 September 2001 6,022 5,482 - -__________ __________ __________ __________

20 Called-up share capital

2001 2000£’000 £’000

_____________________________________________________________________________________________________________________

Authorised

90,000,000 ordinary shares of 5p each (2000 – 90,000,000) 4,500 4,500__________ __________

Allotted, called-up and fully-paid

46,334,693 ordinary shares of 5p each (2000 – 45,790,611) 2,317 2,290 __________ __________

Shareholders’ authority for the purchase of up to 4,582,530 of the Company’s ordinary shares of 5p each was still valid at the end of the year.

During the year 544,082 ordinary 5p shares were issued, with a nominal value of £27,204, in respect of Holidaybreak plc share option schemes.

Details of outstanding share options as at 30 September 2001 are as follows:

Number of Averageshares Exercise price Dates exercise

under option range (p) of grant price (p)_____________________________________________________________________________________________________________________

1991 Savings Related Share Option Scheme 383,859 156.0 - 252.0 1996-2000 212.0

2001 Savings Related Share Option Scheme 156,367 343.0 2001 343.0

1991 Executive (Performance Related) Share Option Scheme 666,640 166.0 - 326.0 1992-2000 279.0

2001 Company Share Option Scheme 24,796 405.5 2001 405.5

1996 Unapproved Share Option Scheme (‘A’ Options) 534,336 166.0 - 405.5 1996-2001 249.0

1996 Unapproved Share Option Scheme (‘B’ Options) 799,382 287.5 - 325.0 2000-2001 312.0

1997 Long-Term Incentive Plan 8,532 Nil 1997 Nil__________

2,573,912__________

Further details of the Company’s share option schemes, together with details of performance criteria are contained in the Remuneration Committee Report on pages 22 to 23 of the report and accounts.

21 Reserves

Sharepremium Other Profit and account reserves loss account Total

Group £’000 £’000 £’000 £’000 _____________________________________________________________________________________________________________________

At 1 October 2000 (as restated) 27,411 87 (9,875) 17,623

Premium on new shares issued 1,317 - - 1,317

Exchange differences - - (52) (52)

Transfer in respect of Quest and EBT - - (222) (222)

Retained profit for the year - - 7,011 7,011__________ __________ __________ __________

At 30 September 2001 28,728 87 (3,138) 25,677__________ __________ __________ __________

During the year ended 30 September 2001, the Company received £404,474 from the issue of shares in respect of the exercise of options administered by the Qualifying Employee Share Ownership Trust (Quest) and the Employee Benefit Trust (EBT). Employees paid £182,944 to the Group for the issue of these shares. The balance of £221,530 comprised contributions to the Quest and the EBT from subsidiary undertakings and is shown as a transfer from the Profit & Loss Reserve.

Ho l i d ayb reak plc

No tes to the acco u nts (continued) No tes to the acco u nts (continued)

Page 40 Page 41

R e po rt by the Au d i tors by Holidaybreak plc on Corporate Governance Matters

21 Reserves (continued)

The cumulative amount of goodwill resulting from acquisitions which has been written off prior to the adoption of FRS10 "Goodwill and Intangible Assets" is £86,305,000.

Sharepremium Other Profit andaccount reserves loss account Total

Company £’000 £’000 £’000 £’000 _____________________________________________________________________________________________________________________

At 1 October 2000 68,502 87 185 68,774

Premium on new shares issued 1,317 - - 1,317

Retained profit for the year - - - -__________ __________ __________ __________

At 30 September 2001 69,819 87 185 70,091__________ __________ __________ __________

22 Reconciliation of operating profit to operating cash flows2001 2000

£’000 £’000 _____________________________________________________________________________________________________________________

Operating profit 24,508 22,802

Depreciation charges and amortisation of goodwill 13,397 12,147

Non-cash fair value adjustment to goodwill (note 11) (550) -

(Increase) decrease in debtors (414) 1,971

Increase in creditors 2,743 2,806__________ __________

Net cash inflow from operating activities 39,684 39,726 __________ __________

23 Analysis and reconciliation of net debt

Other 1 October non-cash 30 September

2000 Cash flow items 2001£’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

Cash at bank and in hand 47,803 1,366 - 49,169

Overdrafts (159) (1,724) - (1,883)

Debt due within one year - - (6,000) (6,000)

Debt due after one year (60,000) 8,500 6,000 (45,500)

HP contracts (19,847) 7,213 (8,217) (20,851)__________ __________ __________ __________

Net debt (32,203) 15,355 (8,217) (25,065) __________ __________ __________ __________

2001 2000 £’000 £’000

_____________________________________________________________________________________________________________________

(Decrease) increase in cash in the year (358) 22,160

Cash outflow (inflow) from decrease (increase) in debt and lease financing 15,713 (9,759)__________ __________

Change in net debt resulting from cash flows 15,355 12,401

New hire purchase contracts (8,217) (10,243)

New loan notes - (9,465)

Net debt at beginning of year (32,203) (24,896)__________ __________

Net debt at end of year (25,065) (32,203) __________ __________

24 Guarantees and other financial commitments

a) Capital commitments 2001 2000

At the end of the year, Group capital commitments were: £’000 £’000 _____________________________________________________________________________________________________________________

Contracted for but not provided for 1,709 2,539__________ __________

b) Contingent liabilities

The Group’s bankers have provided guarantees of approximately £11,894,000 (2000 - £11,510,000) in respect of the Group’s trading activities.

c) Pension arrangements

The Group has defined contribution pension schemes for its directors and senior employees. The pension charge for the year, reflecting amounts paid, was £515,000 (2000 - £448,000).

d) Lease commitments

Annual commitments under non-cancellable operating leases are as follows: Group__________________________________________________

Property Office equipment

2001 2000 2001 2000 £’000 £’000 £’000 £’000

_____________________________________________________________________________________________________________________

Leases which expire

- within 1 year 96 45 22 31

- within 2 to 5 years 37 107 232 292

- after 5 years 352 303 - 1__________ __________ __________ __________

485 455 254 324__________ __________ __________ __________

Leases of land and buildings are typically subject to rent reviews at various intervals specified in the leases and provide for the lessee to pay all insurance,maintenance and repairs costs.

There are no operating leases in the Company.

Ho l i d ayb reak plc

No tes to the acco u nts (continued)

Page 42 Page 43

Registered Office: Hartford Manor, Greenbank Lane,

Northwich, Cheshire CW8 1HW, England

(Registered in England No. 2305562)

Notice is hereby given that the Annual General Meeting ("the Meeting") of

Holidaybreak plc ("the Company") for the year 2002 will be held at The Oaklands

Hotel, Millington Lane, Gorstage, Weaverham, Northwich, Cheshire CW8 2SU on

Tuesday, 26 February 2002 at 2.30 p.m. for the following purposes:

Ordinary Business1. To receive and adopt the directors’ report and the audited accounts for the

year ended 30 September 2001.

2. To declare a final dividend of 12.6 pence per ordinary share in respect of the

year ended 30 September 2001.

3. To re-elect Mr. Richard Westaway Atkinson as a director, who retires by

rotation under Article 76 of the Company’s Articles of Association.

4. To re-elect Mr. Robert Gregory Baddeley as a director, who retires by rotation

under Article 76 of the Company’s Articles of Association.

5. To re-elect Mr. James Robert Crew as a director, who retires by rotation under

Article 76 of the Company’s Articles of Association.

6. To reappoint Arthur Andersen as auditors and to authorise the directors to fix

the auditors’ remuneration.

No t i ce of Annual Ge n e ral Me e t i n g

Ho l i d ayb reak plc

Page 44

Special BusinessTo consider and, if thought fit, pass the following resolutions, resolution 7 beingproposed as an ordinary resolution and resolutions 8 and 9 being proposed as specialresolutions:

7. That for the purposes of Section 80 of the Companies Act 1985 ("the Act") (andso that expressions used in this resolution shall bear the same meaning as in thesaid Section) the directors be and they are hereby generally and unconditionallyauthorised to exercise all powers of the Company to allot relevant securities up toan aggregate nominal amount of £773,400, being not more than one third of theCompany’s issued share capital at 15 December 2001, provided that:

(i) this authority will expire at the conclusion of the next Annual GeneralMeeting of the Company held after the passing of this resolution or 15months after the passing of this resolution whichever is the earlier except tothe extent that the same is rene wed or extended on or before that date;

(ii) the Company may prior to the expiry of such period make any offer oragreement which would or might require rele vant securities to be allottedunder this authority after it expires and the directors may allot relevantsecurities in pursuance of any such offer or agreement notwithstanding theexpiry of the authority given by this resolution, and

(iii) the authority hereby given shall be in substitution for any existing authoritiesunder Section 80 of the Act.

8. That, subject to the passing of resolution 7, in accordance with Section 95(1) ofthe Act, the directors of the Company be and they are hereby authorised to makeallotments of equity securities (as defined in Section 94(2) of the Act) for cash,pursuant to the general authority conferred upon them in accordance with Section80 of the Act by resolution 7 above as if Section 89(1) of the Act did not apply toany such allotments so that:

(i) reference to allotment in this resolution shall be construed in accordancewith Section 94(3) of the Act; and

(ii) the power conferred by this resolution shall enable the Company to makeany offer or ag reement before the expiry of the period stated in (b) belowwhich would or might require equity securities to be allotted after the expiryof the said power and the directors may allot equity securities in pursuanceof any such offer or agreement notwithstanding the expiry of such power;

PROVIDED however that the power conferred by this resolution shall:

a) be limited:

(i) to the allotment of equity securities which are offered to all the holdersof issued ordinary shares of the Company (at a date selected by thedirectors of the Company) where the equity securities respectivel yallotted to the holders of ordinary shares are as nearly as practicable inproportion to the number of ordinary shares held by them respectivelybut subject to such exclusions and other arrangements that thedirectors of the Company may deem necessary or expedient in relationto fractional entitlements or any legal or practical difficulties under thelaws of any territory or the requirements of any regulatory body or stockexchange;

(ii) to the allotment (otherwise than pursuant to sub-paragraph (a)(i)above) of equity securities up to an aggregate nominal value of£116,000 being not more than 5% of the Company’s issued ordinaryshare capital at the 15 December 2001; and

b) expire at the conclusion of the next Annual General Meeting of the Companyheld after the passing of this resolution or 15 months from the passing ofthis resolution whichever is the earlier except to the extent that the same isrenewed or extended on or before that date.

9. That the Company be and is hereby generally and unconditionally authorised,pursuant to Section 166 of the Act, to make one or more market purchases (withinthe meaning of Section 163 of the Act) of ordinary shares of 5p each in the

capital of the Company ("ordinary shares" or singularly "ordinary share") on suchterms and in such manner as the directors may from time to time determine,provided that:

i) the maximum aggregate number of ordinary shares hereby authorised to bepurchased is 4,640,900 (representing just less than 10% of the Company’sissued ordinary share capital at 15 December 2001);

ii) the minimum price which may be paid for such ordinary shares is 5p pershare (exclusive of expenses);

iii) the maximum price (exclusive of expenses) which may be paid for anordinary share is not more than 5% above the average of the middle marketquotations for an ordinary share as derived from the London Stock ExchangeDaily Official List for the five business days immediately preceeding the dayon which the ordinary share is purchased;

iv) unless previously revoked or varied, the authority hereby confer red shallexpire on the earlier of the conclusion of the next Annual General Meeting ofthe Company held after the passing of this resolution and 15 months afterthe passing of this resolution; and

v) the Company may make a contract or contracts to purchase ordinary sharesunder the authority hereby conferred prior to the expiry of such authority,which will or may be executed and completed wholly or partly after theexpiry of such authority, and the Company may make a purchase orpurchases of ordinary shares in pursuance of any such contract or contracts.

By order of the Board

J. A. Vickers ACISSecretary

Hartford Manor, Greenbank Lane, Northwich, Cheshire CW8 1HW

14 January 2002

Notes

1 A member entitled to attend and vote at the Meeting is entitled to appoint one or

more proxies to attend and, on a poll, to vote instead of him or her. A proxy need

not be a member of the Company. To be valid the form of proxy, duly executed,

together with any power of attorney or other authority under which it is executed,

must be deposited with Northern Registrars, Northern House, Woodsome Park,

Fenay Bridge, Huddersfield, HD8 0LA no later than 48 hours before the Meeting.

Completion and return of the form of proxy will not prevent a member attending

the Meeting and voting in person if he or she so wishes. A form of proxy for use

at the Meeting is enclosed herewith.

2 Pursuant to the Uncertificated Securities Regulations 1995, the Company has

specified that only those shareholders registered in the Register of Members of

the Company at 2.30 p.m. on 24 February 2002 will be entitled to attend and

vote at the Meeting in respect of the number of Shares registered in their name at

that time. Changes to the Register of Members after 2.30 p.m. on 24 February

2002 will be disregarded in determining the rights of any person to attend and

vote at the Meeting.

3 Copies of the Register of the Directors’ Interests in the share capital of the

Company and the Directors’ Service Agreements will be available for inspection at

the registered office of the Company during normal business hours on any

business day (Saturdays, Sundays and public holidays excepted) from the date of

this Notice up to and including the date of the Annual General Meeting and will

also be available for inspection at The Oaklands Hotel, Millington Lane, Gorstage,

Weaverham, Northwich, Cheshire CW8 2SU from 12 noon on the day of the

Annual General Meeting until its conclusion.

No t i ce of Annual Ge n e ral Meeting (co nt i n u e d )

EurocampSelf-drive camping and mobile-home

holidays in France, Italy and seven

other European countries.

08709 019404 www.eurocamp.co.uk

KeycampMobile-home and tent holidays in

France and seven other European

countries. Available through agents.

08707 000123 www.keycamp.com

Eurocamp Independent European camp-site reservation service

for customers with their own caravan,

tent or motor-home.

08709 060604

www.eurocampindependent.co.uk

Sites AbroadBudget ‘no frills’ camp-site reservations

service offered by Eurocamp

Independent.

08709 040030

Touring Cheque‘Go as you please’ option offered by

Eurocamp Independent

08709 060123

EurovillagesHoliday villages and centres in France,

Italy, Spain, Holland and Germany.

Self-drive and fly/drive options.

08709 019458 www.eurovillages.co.uk

Camping Adventure

Find out more about our holidays

If you would like to find out more about any of our holidays please ring the numbers shown below for a brochure or visit the relevant website.

Shareholders are entitled to a 10% reduction on full brochure prices for bookings made direct. Details of our shareholder discount scheme are sent out

with the Annual Report and are also on our corporate website at www.holidaybreak.co.uk.

All our consumer sites can conveniently be accessed through the corporate site. The Holidaybreak plc site is there to meet the needs of anyone who

has an interest in our financial and corporate affairs. All Company announcements are posted on the site as soon as they are released by the London

Stock Exchange. It also contains a wealth of background information about the Company and its development, detailed biographies of directors and

other senior management.

Explore WorldwideSmall group tours, treks, safaris and

expeditions all over the world - over

100 countries and 300 different tours

on offer. Suited to a wide range of

ages, interests and holiday aspirations.

01252 760000

www.exploreworldwide.com

Regal Dive WorldwideWorldwide diving and snorkelling

holidays for all age groups and levels.

Learn to dive and more advanced

courses, liveaboards and safaris.

Red Sea, Caribbean, Maldives,

Indonesia and more.

08702 201777

www.regal-diving.co.uk

Hotel Breaks

SuperbreakHotel short-breaks throughout the UK.

Special theatre, rail inclusive and

event packages also offered. Available

in travel agents.

08705 499499 www.superbreak.com

Hotel BreaksHotel short-breaks in the UK. Hotel

only or rail inclusive. Available in

travel agents.

08705 499499 www.superbreak.com

Luxury Hotel CollectionA unique selection of Britain’s finest

hotels. Elegant accommodation, fine

cuisine and outstanding hospitality.

08705 499499

European HotelsHotels in European cities and beyond,

including 250 hotels in all the top city

break destinations plus 100 more on-

line. Available through agents.

08705 499499 www.superbreak.com

Theatrebreak Hotel, theatre and dining packages -

mainly London.

08705 499499

National Trust Short Break CollectionSpecial brochure for National Trust

members. Each booking generates a

donation to the National Trust.

08706 001818

Airport HotelsOvernight hotels and parking at all

major UK airports for customers flying

to overseas holiday destinations.

08705 499499

HotelnetThe leading UK hotel booking service on

the internet. More than 40,000 hotels

worldwide, over 98% of which offer

instant online availability and booking.

www.hotelnet.co.uk

www.holidaybreak.co.uk