AGM - chairman's statement

Speaking today at Arriva plc's Annual General Meeting SirRichard Broadbent, chairman, said:

When we announced our preliminary results for the yearended 31 December 2005, on 2 March 2006, we reported a strongperformance across the Group. Continued growth through new contractwins in our mainland European operations and firm management in ourexisting businesses ensured rising fuel costs were robustly managedand profits were successfully maintained in our first full yearwithout the Northern rail franchise.

Some years ago, we identified the growth opportunityarising from the liberalisation of public transport markets inmainland Europe. Our strategy of selective investment in thesemarkets continues to deliver growth with revenue in our mainlandEuropean operations doubling over the past three years and marginsincreasing. In 2005, rail contract wins in the Netherlands andGermany; expansion of our bus operations in Italy, Denmark andSweden, and successful entry into the German bus market furtherstrengthened our position as a leading European transport operatorand increased our resilience in the highly competitive transportmarket.

In February we won a nine-year contract to operatePågatåg regional train services in the south of Sweden,securing our entry in this rail market from June 2007. We have alsoincreased our presence, and potential, in the German transportmarket after agreeing to acquire Bils, a 118 bus operation inNorth-Rhine Westphalia.

We completed the repositioning of the Group with thesale of our vehicle rental business earlier this year. This willprovide further resources to pursue our business strategy and growour core business. Arriva remains in a strong position to benefitin the increasingly liberalising European transport market and wesee further opportunities for our UK bus and rail operationsthrough innovation and encouraging greater use of publictransport.

Bob Davies retires as Arriva's chief executive at theend of the AGM. Bob's vision and leadership has transformed Arrivainto a leading public transport organisation. The Group is in verygood shape. It is strategically focused, delivering consistentresults and has an excellent management team. Our successionplanning means that we are ready to move forward and I am confidentArriva will continue to thrive under David Martin'sleadership.

We have maintained the positive start to the year weannounced at our preliminary results: trading is in line withexpectations. Our strategy remains to generate shareholder value byensuring our current businesses reach their full potential anddelivering strong growth through targeted acquisitions andtendering opportunities.