• Earnings per share of 6.21 pence, an increase of 27% year-on-year
• Dividend per share of 7.177 pence, up 5%
  
  

The figures above, and in the narrative below, are before the impact of goodwill amortisation and, in the prior year, exceptional items unless otherwise stated.

* Excludes Thus dividend in specie arising on its demerger

Ian Russell, Chief Executive, said, "I am pleased to report another quarter of improved operational performance giving ScottishPower earnings per share of 6.21 pence, an increase of 27% compared with the first quarter of last year".

Financial Overview

ScottishPower's improved first quarter performance was led by PacifiCorp, our US regulated business, reflecting lower power costs, increased regulatory recoveries and continued progress in delivering Transition Plan cost savings. The reduced contribution from the UK Division due to lower wholesale prices was more than offset by operating profit improvement at both PacifiCorp and PacifiCorp Power Marketing (PPM) and by increased regulatory revenues and operating cost reductions in the Infrastructure Division.

Group turnover in the quarter fell to £1,238 million, £447 million (27%) lower than the first quarter of the previous year. Of this decrease, £204 million relates to discontinued operations in the UK, principally Southern Water, and £243 million relates to continuing operations. In the US, PacifiCorp's revenues decreased by £258 million (29%) due to reductions in wholesale prices in the western US, offset in part by favourable volumes and increased regulatory recoveries. PPM's revenues increased by £43 million as a result of the development of its renewable and thermal generation and gas storage businesses. In the UK, turnover in our Infrastructure Division has increased by £17 million mainly as a result of increased regulatory income from higher external sales, and in the UK Division the fall of £45 million reflects the impact of lower UK wholesale prices and competition in our supply home areas.

Group operating profit increased by £23 million (11%) to £223 million with operating profit from continuing operations up £35 million (20%) at £209 million. PacifiCorp reported operating profit of £134 million, an increase of £44 million (48%) on the first quarter of the previous year, and PPM reported operating profit of £4 million, £2 million higher than the corresponding period last year. This, together with the increase of £2 million in the Infrastructure Division, more than offset the decrease of £13 million in the contribution to operating profit from the UK Division and the £12 million reduction from discontinued operations, mainly attributable to Southern Water.

The net interest charge in the quarter decreased by £27 million to £69 million. This was due to the reduction in net debt following the finalisation of the sale of Southern Water, which realised gross proceeds of £2,050 million, including debt assumed by the purchaser.

Profit before tax increased by £47 million to £152 million and the tax charge of £37 million represents an effective tax rate of 24%, increased from the prior year rate of 22.5% on profits before goodwill amortisation and exceptional item. Earnings per share were 6.21 pence, an increase of 1.31 pence (27%) on the equivalent period last year. Continuing operations contributed earnings per share of 5.80 pence compared with 3.88 pence for the first quarter of the previous year, an increase of 49%.

Operating cash flow increased by £101 million in the quarter to £253 million principally due to the increase in operating profit and lower volatility in market prices in the US. Investment in capital projects was £179 million, a decrease of £58 million, including a decrease of £63 million in discontinued operations and an increase of £5 million in continuing operations. The £179 million of capital spend comprised £94 million in PacifiCorp, £5 million in PPM, £48 million in the Infrastructure Division, £17 million in UK Division and £15 million in Southern Water. Net cash inflows from disposals of £1,946 million mainly represent the proceeds from sale of Southern Water, being the sale price of £2,050 million less debt of approximately £100 million assumed by the purchaser. Net debt as at 30 June 2002 of £4,158 million was £2,050 million lower than at 31 March 2002, after the benefit of a weaker dollar reducing the sterling value of debt. Gearing (net debt/shareholders' funds) decreased to 89%, from 131% at 31 March 2002.

As part of a long term hedge programme we have substantially hedged, at below current market rates, the translation of dollar earnings from PacifiCorp for the year to 31 March 2003 and approximately 80% of our US dollar net assets. We continue to enter into hedging arrangements to minimise the impact on reported earnings from volatility in exchange rates.

The first quarter dividend of 7.177 pence per share payable on 16 September 2002 is consistent with our stated aim of a 5% annual increase in dividends to March 2003. The ADS dividend rate is $0.4472 which has been determined by the directors with reference to the sterling / dollar exchange rate ruling in London on 24 July 2002, the last business day preceding the dividend announcement.

PacifiCorp

PacifiCorp is our regulated US business and its strategic priorities are to:

• Achieve 11% return on equity target by 2004/05 through:
• recovery via general rate cases of costs incurred
• operating efficiencies through the Transition Plan
• Manage risk and reward balance
• Deliver excellent customer service

PacifiCorp demonstrated another quarter of improving financial performance, consistent with its goal of increasing operating profit over the next three years to approximately $1 billion. PacifiCorp is targeting to achieve its authorised return on equity, currently approximately 11%, through a combination of operating efficiencies, investments and rate filings. PacifiCorp is presently earning approximately half its authorised rate of return and is seeking to recover costs prudently incurred but not yet in rates.

Operating profit in PacifiCorp was £134 million, an increase of £44 million (48%). This improved financial performance was mainly as a result of regulatory rate increases of £17 million, rate recoveries of excess power costs of £15 million, lower power costs of £57 million and continued progress with the Transition Plan cost savings of £9 million. These contributions to operating profit were partly offset by £12 million in reduced transmission revenues due to lower transmission volumes, planned additional costs, primarily risk mitigation initiatives, of £16 million and depreciation arising from new investment activities amounting to £8 million. The previous year's results included a gain on a loan receivable, previously partially provided against, of £18 million which was not recurring in this year.

Capital spend in the quarter was £94 million, an increase of £12 million compared to the equivalent period last year, and comprised new generation spend of £11 million, including construction of the Gadsby gas-fired generation peaking plant, network growth of £26 million, refurbishment of £49 million and other capital projects of £8 million.

Under UK GAAP, all of PacifiCorp's net power costs are charged to the profit and loss account when incurred. The regulatory recovery of deferred excess power costs charged to the profit and loss account is recognised as income under UK GAAP when billed to customers.

PacifiCorp continues to seek regulatory recovery for costs incurred on behalf of customers. Filings include general rate cases, deferred accounting requests, and other filings as needed. Details of expected hearing dates for these and other regulatory actions are set out in an appendix to this announcement.

General Rate Cases: To maximise regulatory returns, on 7 May 2002 PacifiCorp filed with Wyoming regulators for a $30.7 million general rate case, representing an increase of 9.8% in revenues from customers within the state. On 20 May 2002, Oregon regulators made a one-off award of $15.4 million one off principally related to excess power costs to be incurred this summer. On 27 June 2002, California regulators approved an interim rate increase of approximately 9%, or $4.7 million in annual revenues. The increase is subject to review as part of the permanent general rate case filing pending before the California Public Utilities Commission. PacifiCorp is considering making general rate case filings in other states during the current financial year.

Deferred Cost Recovery: To recover costs incurred on behalf of customers, regulators awarded recovery of approximately $147 million in deferred power costs in Utah on 1 May 2002, and in Idaho a further $25 million was awarded on 7 June 2002, both at a recovery level of approximately 70% of amounts deferred or requested. In Oregon our request to recover $136.5 million in deferred excess power costs was approved by the Oregon Public Utility Commission (OPUC) on 18 July 2002. PacifiCorp expects to file a request in August 2002 with the OPUC to raise the annual surcharge level to recover these costs to 6% from the 3% currently being received. In Wyoming, in conjunction with the general rate case in that state discussed above, PacifiCorp has requested recovery of $91 million in deferred excess power costs, including the costs of the Hunter outage, to be recovered through two surcharges over three years.

Transition Plan: To help the regulated US business reach its financial goal, a further $13 million in Transition Plan cost savings were realised during the quarter toward the overall target of $300 million savings by 2004/05. Cumulative annual savings now total approximately $130 million, and the programme remains on track. Reflecting PacifiCorp's strong operational focus, the quarter also included a generation maintenance programme designed to ensure a high level of plant availability during the summer period and implementation of a fuel mix strategy that optimises fuel content for each plant to ensure peak operating performance. Increased costs resulted from these risk mitigation initiatives, as well as upward pressure on various insurance premiums and employee medical benefits which are also being experienced by many other US companies.

Energy markets: The western US energy markets were stable in the first quarter with adequate capacity. The fill level of hydro-electric dams is also back to normal historic levels. Although demand has increased in the western US, PacifiCorp is well positioned for this summer and beyond through a combination of its flexible generation fleet, and the risk management steps implemented over the past 12-18 months. Physical additions of peaking plant to meet summer demand such as the 120 MW Gadsby gas-fired peaking plant in Utah, scheduled to come on-line in late summer 2002, and the lease from PPM of a 200 MW peaking plant in Utah, 160 MW of which are now operational, and other flexible physical hedge products, will help maintain PacifiCorp's balanced net energy position through this financial year.

Risk mitigation: In addition to adding new plant, financial hedge instruments such as temperature and weather-related hedges are expected to provide protection against abnormal events. Longer-term initiatives on resource planning continue with regulators and we continue to progress options with other parties.

Customer Service: PacifiCorp continues to focus on delivering improved customer service levels. Plans have been prepared to gain further efficiencies from the call centre technologies implemented last year. The goal of these technology enhancements, combined with ongoing investment in training, is to handle calls more quickly and efficiently. We continue to answer 80% of customer calls in 20 seconds or less, with an emphasis on improving quality. Further improvements are targeted at customer self-service options as well as improvements for handling network faults. In the past few months, PacifiCorp experienced a number of unplanned outages in Utah as a result of higher than normal temperatures, continuing customer growth and increasing demand for electricity. In targeting these problem areas of the network, PacifiCorp had planned and is investing more than $34 million this year along the Wasatch Front in Utah to upgrade lines, add substations and increase the capacity of the distribution system.

Other investments to provide for long-term system reliability, stability and growth are being considered by PacifiCorp as part of various strategic and regulatory initiatives. These projects are designed to address the challenges faced by PacifiCorp as a multi-state utility and to anticipate and plan for long-term transmission and generation requirements. Resulting investments through participation in the Multi State Process, the Integrated Resource Plan, hydro-electric relicensing, new air quality standards, and participation in a Regional Transmission Organization will seek to meet system and customer needs, while assuring full recovery of prudently incurred new costs.

During the quarter, PacifiCorp responded to data requests from the Federal Energy Regulatory Commission (FERC) regarding trading practices connected with the California power crisis of 2000 and 2001. We were able to confirm positively that PacifiCorp did not engage in any trading practices intended to manipulate the market as described in FERC's request.

PacifiCorp Power Marketing, Inc.

The strategic priorities of PPM, our competitive US energy business, are to:

• Grow its renewable/thermal energy portfolio and gas storage/hub services
• Optimise returns through integration of assets, trading and commercial activities

PPM is growing its renewable/thermal energy portfolio and gas storage/hub services businesses through a regional approach with selective investments. PPM reported an operating profit of £4 million, an increase of £2 million, with sales up £43 million (197%) to £65 million, which included revenues from our 40% share of the gas storage and hub services facility in Alberta, Canada, acquired in January 2002.

Net capital expenditure in PPM was £5 million, a decrease of £22 million, to expand its energy portfolio, with spend of £4 million on the West Valley City gas turbine plant in Utah, as well as gas storage assets and business control systems.

As part of its development of thermal generation, PPM brought on-line in June 2002 two new combustion gas turbine facilities, the 100 MW gas-fired Klamath expansion plant adjacent to the existing 484 MW Klamath Cogeneration Plant in Oregon and the first 160 MW of the 200 MW gas-fired West Valley Generation Plant near Salt Lake City, Utah, which is providing electricity to PacifiCorp under a lease of up to 15 years.

To continue growing its renewable generation business, PPM signed a 25-year transaction on 11 May 2002 to sell 25 MW of wind power to the Eugene Water & Electric Board (EWEB) in Oregon. The $93 million EWEB contract is similar to recent sales to Seattle City Light and the Bonneville Power Administration, locking in long-term value from PPM's output of the Stateline windfarm in Oregon and Washington. In June 2002, the American Wind Energy Association named PPM national "Market Maker" of the year for 2002 for helping build a market for wind in the US.

PPM continues to develop power generating and supply arrangements and has under consideration 15-20 mostly wind opportunities in strategic locations in the western and midwestern US. PPM expects to approve about 300 MW of new wind projects this year. Similarly, PPM is developing a number of gas storage assets in key locations.

During the quarter, PPM responded to data requests from the FERC regarding trading practices connected with the California power crisis of 2000 and 2001. We were able to confirm positively that PPM did not engage in any trading practices intended to manipulate the market as described in FERC's request.

UK Division

In the UK Division, our competitive generation, trading and retail business, our strategic priorities are to:

• Enhance margins through our integrated operations
• Grow customer numbers and improve customer service
• Make selective investments using proven knowledge and skills

The UK Division reported an operating loss of £8 million, compared to a £4 million profit in the previous year. In what is seasonally a poor quarter for UK performance, there has been increased supply profitability of £20 million arising from improved margins primarily due to lower wholesale electricity prices. Home and out of area electricity profits increased by £4 million and £15 million respectively due to lower wholesale prices whilst gas margins improved by £1 million as a result of customer growth. However, this improvement has been more than offset by a decrease in margins from generation of £32 million, where wholesale prices have fallen by approximately 24% year-on-year. Our integrated approach to management of the energy value chain helps protect us from some aspects of falling wholesale prices, but sales out of Scotland, and sales to other suppliers in Scotland, are subject to market conditions.

On 15 July 2002 we agreed revised terms to the Nuclear Energy Agreement (NEA) with British Energy and Scottish and Southern Energy. The revised terms are subject to regulatory approval but legal proceedings have been suspended. We will purchase electricity from British Energy under arrangements much more closely linked to market prices and terms for base load energy in England and Wales. The amended NEA will continue in operation until the introduction of the British Electricity Transmission and Trading Arrangements (BETTA) or, if earlier, 1 April 2006. Beyond that date we have an option to purchase reduced volumes from British Energy after BETTA up to 2011. Prudently, the financial benefit of the revised terms will not be recognised in our accounts until regulatory approval of the contract is given. The settlement is satisfactory to all sides and the companies believe it represents a fair and reasonable basis on which to resolve the dispute between them.

Net capital expenditure in UK Division was £17 million, a decrease of £10 million and included £9 million on coal and gas-fired generation assets.

In our Generation business, working in partnership with trade unions, a programme is in place that will see approximately 95, (13%), of staff leaving the business on a phased basis over the next nine months, with new structures in place to reflect the changing business environment.

Customer numbers remain at 3.5 million, however, we are seeing modest monthly growth reflecting continuing lower levels of churn and improved sales performance. We were pleased to receive a World Billing Award in April 2002 in the "Best Billing Implementation Utilities" category, following our successful migration to a single billing platform. Process improvement and cost reduction projects are underway and are expected to improve our cost to serve in the second half of the year.

In terms of our priority to make selective investments, we continued during the quarter with our ambitious programme of windfarm developments. We secured planning consent for a 29 MW installation located in Cowal, Argyll and submitted planning applications for a further three windfarms comprising 134 MW at Black Law in South Lanarkshire, 29 MW at Beinn Tharsuinn and 18 MW at Dounreay, both in Highland Region. The proposed 240 MW windfarm at Whitelee near Eaglesham has received planning recommendations from all three local authorities involved in the planning process. The proposal is now with the Scottish Executive for final approval.

Our trading strategy has focused on reducing our exposure to falling wholesale electricity prices and on benefiting from the flexibility of our generation assets. In our opinion, we continue to be one of the leaders in the Balancing Mechanism despite intensifying competition, and we estimate we achieved the highest contribution per Balancing Mechanism Unit for the first quarter of 2002/03 as well as for the year ended 31 March 2002. Our flexible generation plant is working well under the new one-hour NETA gate closure period which started on 2 July 2002.

Infrastructure Division

In the Infrastructure Division, our regulated UK wires business, our strategic priorities are to:

• Be at or near the regulatory frontier
• outperform operating cost targets
• achieve better than planned output from capex
• Achieve high standards of customer service
• Invest consistently to add value

The Infrastructure Division reported operating profit of £79 million, £2 million higher than the equivalent period last year. The ongoing restructuring programme contributed cost reductions of £3 million. These, together with increased regulatory revenues due to a higher percentage of sales to external suppliers, were in part offset by increased depreciation from capital investment and higher insurance premiums.

Capital investment for the quarter increased by £24 million to £48 million, of which £33 million related to upgrading and renewing the network, £10 million related to new infrastructure to increase the capacity of the system and £5 million related to other capital projects.

We remain firmly on target to deliver £75 million of cash cost savings by March 2003, having achieved £73 million to date, and to make progress toward the further £33 million of operating cost reductions in the Infrastructure Division by March 2004, as previously announced. Savings are being targeted in areas such as procurement, metering and transport as well as operating practice efficiencies.

We are supporting Ofgem's BETTA project and are involved with industry working groups examining the assignment of responsibilities between the System Operator and the Transmission Owner.

We are focused on driving down customer minutes lost and customer interruptions to achieve higher standards of customer service. To achieve these improvements, and consistent with our strategy, we will also make investments in our Regulatory Asset Base that contribute value. Our investment programme involves substantial upgrading in the Scottish Borders area and our Urban Automation Project commenced in the first quarter. Both projects are aimed at providing our customers with a better and more secure supply and at improving our performance. In respect of our Scottish Borders scheme, £4 million of investment has been made to date, £2 million in the quarter, on construction of overhead line and a number of packaged substations. The Urban Automation Project involves the installation of new 11 kV switchgear equipped with modern protection aimed at benefiting customers.

Discontinued operations

Operating profit from discontinued operations of £14 million represents the operating profit of Southern Water to 23 April 2002, when its sale to First Aqua Limited was finalised. This represents a decrease of £12 million, over the first quarter of the previous year, which included a full quarter's results for Southern Water as well as the results of UK Appliance Retailing and Thus.

Corporate Social Responsibility

Our track record in the area of health and safety is generally good but we have set an ambitious target for this year to reduce by 25% the accident total for last year. All of our businesses were on course to achieve this target at the end of the first quarter. In spite of our track record and progress in this area, we are saddened to report the deaths of two colleagues in fatal accidents in July 2002, one in the US and one in the UK.

In July 2002 ScottishPower won the Best Company of the Year Award by Business in the Community (BitC). BitC is a leading organisation that promotes social responsibility and facilitates sustainability and social improvement efforts between the Government, UK corporations and the not-for-profit community.

We were also honoured with the Award for Excellence for ScottishPower Learning's SkillSeekers Programme, which assists unemployed young people find jobs in the community. In addition, we received a highly commended citation for our work on having a positive environmental impact.

In the US, PacifiCorp was named a 2002 Winter Games Environmental Champion and received a Spirit of the Land Award for excellence in environmental education. PacifiCorp was also awarded the National Family Volunteer Award for Community Volunteering and National Service, a national award received from the Points of Light Foundation.

Investor Calendar

26 July 2002 Annual General Meeting

31 July 2002 Ordinary and American Depositary Shares go ex-dividend for the 1st quarter

2 August 2002 Last date for registering transfers to receive 1st quarter dividend

16 September 2002 1st quarter dividend payable

5 November 2002 2nd quarter results

16 December 2002 2nd quarter dividend payable

5 February 2003 3rd quarter results

14 March 2003 3rd quarter dividend payable

7 May 2003 Full year results

16 June 2003 4th quarter dividend payable

APPENDIX - RECENT US RATE FILINGS AND SCHEDULE DATES

General Filings

Since 31 March 2002, activity on general rate cases has comprised of the following:

Wyoming

On 7 May 2002, PacifiCorp filed a general rate case in Wyoming for $30.7 million in ongoing general rate case relief. This filing also requested $91 million of deferred excess net power costs described under the deferred costs section that follows.

Oregon

On 20 May 2002, the Oregon Public Utilities Commission (OPUC) awarded $18.7 million related to excess power costs to be incurred this summer. Combined with other rate case issues, the net impact in Oregon is $15.4 million.

California

On 27 June 2002 the California Public Utilities Commission (CPUC) granted PacifiCorp's request for an interim increase in its prices of approximately $4.7 million. The increase is subject to review as part of a general rate increase request PacifiCorp filed late in 2001 with the CPUC. No decision is expected on this request until later in 2002.

Deferred Excess Power Costs

Under US GAAP, excess net power costs, where approved by regulators, are initially deferred as regulatory assets and recovery is sought through subsequent rate filings. Allowable excess net power costs are only charged to income under US GAAP when regulatory mechanisms for recovery have been established. There is therefore a time lag between the recognition of allowable excess power costs under UK GAAP compared to US GAAP, which will benefit future UK GAAP reported earnings.

At 30 June 2002, PacifiCorp had $367.5 million of amounts deferred, $47.4 million lower than at 31 March 2002 due to collecting $11.2 million of revenues and $36.2 million of other movements and disallowances. Total excess net power cost amounts awarded to PacifiCorp to 30 June 2002 were $206.6 million, with a further $192.9 million under consideration. Further excess net power cost information is described below concerning deferred accounts, as well as recovery requests and awards.

In Oregon, PacifiCorp has deferred $137.1 million including carrying charges, net of costs recovered through amortisation. A change from the $154.8 million deferred at 31 March 2002 resulted from amounts collected in the first quarter of $5.6 million and adjustments based on calculations under the deferral mechanism of $15.3 million, offset by carrying charges of $3.2 million. On 18 July 2002, the OPUC approved recovery of $136.5 million. PacifiCorp is currently receiving $22.8 million per year of this amount pursuant to a 3% surcharge. A total of $29.9 million has been recovered to date. In August 2002, PacifiCorp plans to request the surcharge be increased to a 6% annual rate, or $45.0 million per year, which is the current maximum recovery level allowed in Oregon.

In Utah, PacifiCorp has a net deferral of $58.1 million at 30 June 2002, a change from the $109.1 million deferred at 31 March 2002. PacifiCorp requested recovery of $205 million in costs related to excess net power costs from the Utah Public Service Commission (UPSC) and on 1 May 2002, the UPSC approved a settlement among PacifiCorp, utility regulators and consumer groups totaling approximately $147 million that resolved outstanding power cost issues related to the Hunter power station outage and summer 2001 excess net power costs. As a result of the order, PacifiCorp will not be required to credit customer bills for the remaining Utah proceeds from the sale of its Centralia Plant, or the merger credits in Utah, which results in a total benefit to PacifiCorp of $46.9 million. During the quarter, PacifiCorp collected $4.1 million of these costs.

In Wyoming, on 7 May 2002, PacifiCorp filed a case with the Wyoming Public Service Commission requesting recovery of $91.0 million of deferred excess net power costs, including the Hunter plant outage-related costs. PacifiCorp has a net deferral of $92.1 million at 30 June 2002, a change from the $91.0 million deferred at 31 March 2002 resulting from the addition of $1.1 million in carrying charges.

In Idaho, PacifiCorp had a net deferral of $37.4 million at 31 March 2002. On 7 June 2002, the Idaho Public Utilities Commission approved an agreement for PacifiCorp to recover $25.0 million of excess net power costs, which resulted in a write off of $12.4 million. Also as a result of this approval, PacifiCorp will not be required to credit customer bills for merger credits in Idaho, which results in a benefit of $2.3 million During the quarter, PacifiCorp collected $0.7 million of these costs, resulting in a net deferral of $22.0 million at 30 June 2002.

Other Filings

A request to defer excess power costs for one year beginning 1 June 2002 in Washington was filed on 5 April 2002. Under these mechanisms, if granted by the commissions, all or part of actual power costs above or below the level in rates will be shared with customers.

Safe Harbor

Cautionary Statement Regarding Forward Looking Statements

Certain statements contained herein are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this document include, but are not limited to, statements in: "PacifiCorp" relating to PacifiCorp's aim to achieve 11% return on equity by 2004/05, make additional general rate case filings, file a request with the Oregon Public Utility Commission to recover additional deferred excess power costs, take risk management steps to protect against abnormal events, improve customer service levels and invest to provide for long-term system reliability, stability and growth; "PacifiCorp Power Marketing, Inc." relating to growing a thermal/renewable energy portfolio and gas storage/hub services and integrating assets, trading and commercial activities; "UK Division" relating to process improvement and cost-reduction projects, continuing the windfarm development programme, improving customer service and making selective investments; "Infrastructure Division" relating to delivering £75 million of cash cost savings by March 2003, making progress toward the further £33 million of operating cost reductions to the Infrastructure Division by March 2004 and investing in our Regulatory Asset Base that contribute value.

ScottishPower wishes to caution readers, and others to whom forward-looking statements are addressed, that any such forward-looking statements are not guarantees of future performance and that actual results may differ materially from estimates in the forward-looking statements. ScottishPower undertakes no obligation to revise these forward-looking statements to reflect events or circumstances after the date hereof. In addition to the important factors described elsewhere in this document, the following important factors, among others, could affect the group's actual future:

any regulatory changes (including changes in environmental regulations) that may increase the operating costs of the group, may require the group to make unforeseen capital expenditures or may prevent the regulated business of the group from achieving acceptable returns;
future levels of industry generation and supply, demand and pricing, political stability, competition and economic growth in the relevant areas in which the group has operations;
the success of reorganizational and cost-saving efforts;
development and use of technology, the actions of competitors, natural disasters and other changes to business conditions.
Further information:

Andrew Jamieson Head of Investor Relations 0141 636 4527