2005/06 Full Year Results and Proposed Refinancing

25 May 2006

Disclaimer
This document, which has been issued by Invensys plc (the Company), comprises the written materials/slides for an analysts presentation in connection with the proposed rights issue (the Rights Issue) and bank refinancing (together, the Refinancing). No representation is made as t o the completeness of the information provided herein or at such sessions. This document is an advert and does not constitute a prospectus relating to the Company; it has not been approved by the Financial Services Authority, nor does it constitute or form part of any offer to sell, or the solicitation of any such offer to subscribe for or buy, any shares in the Company to any person in any jurisdiction, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision in relation thereto.

Recipients of this document who are considering a subscription of shares in the Rights Issue following publication of the prospectus in connection therewith are reminded that any such purchase should be made solely on the basis of the information contained in the prospectus. No reliance may be placed for any purposes whatsoever on the information contained in this document or on its completeness. Although care has been taken to ensure that the facts stated in this presentation are accurate and that the opinions expressed are fair and reasonable, no representation or warranty, express or implied, is given by or on behalf of the Company, any of the directors, or any other person as to the accuracy or completeness of the information or opinions contained in this document. None of the Company or any of its members, directors, officers, employees or advisers nor any other person accepts any liability whatsoever arising from any use of this presentation or its contents or otherwise arising in connection therewith.
The contents of this presentation are to be kept confidential and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, in whole or in part, for any purpose. Neither this document nor any copy of it may be taken or transmitted in or into the United States, its territories or possessions or distributed, directly or indirectly, in the United States, its territories or possessions. Neither this document nor any copy of it may be taken or transmitted in or into Australia, Canada, France, South Africa or Japan or to Canadian persons. Any failure to comply with this restriction may constitute a violation of United States, French, South African, Australian, Canadian or Japanese securities law. The distribution of this document in other jurisdictions may be restricted by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. This document does not contain or constitute an offer of securities for sale in the United States. The rights and new shares to which this document relates have not been registered, and will not be registered, under the US Securities Act of 1933 (the Securities Act) and may not be offered, so ld, taken up, exercised, resold renounced, transferred or delivered, directly or indirectly, within the United States (as defined in Regulation S under the Securities Act) unless they are registered or exempt from the registration requirements of the Securities Act and in compliance with state securities laws. No public offer is being made in the United States. Certain statements in this presentation are forward-looking statements. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. Forward-looking statements contained in this presentation regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should not place undue reliance on forward-looking statements, which speak as only of the date of this presentation. No statements made herein regarding expectations of future profits are profit forecasts, and no statements made herein should be interpreted to mean that the Companys profits or earnings per share for any future period will necessarily match or exceed the historical published profi ts or earnings per share of the Company. By participating in this presentation or by accepting any copy of this document, you agree to be bound by the foregoing limitations.

Agenda
Full Year Results
Financial review

Operational review

Refinancing
Rationale Details of rights issue Financial impact

Summary

Financial review
Adrian Hennah, CFO

Topics

1. Q4/Full year results 2. Refinancing

Income statement
million Q4 05/06 Q4 04/05 FY 05/06 FY 04/05

Orders:

Continuing

697

599

2,637

2,438

Revenue:

Continuing

682

614

2,457

2,359

OPBIT:

Continuing

71

63

191

165

Restructuring costs Impairment: property, plant and equipment Goodwill impairment Product recall costs Transition costs Other operating exceptional items Loss on sale of assets and operations Operating profit/(loss)

(20) (7) 8 (7) 45

(16) 1 (2) (2) 44

(41) (14) 8 (13) 131

(50) (61) (28) (30) (17) (3) (24)

Income statement
million Operating profit/(loss) Foreign exchange (losses)/gains Net finance costs Other finance charges IAS 19 Profit/(loss) before taxation Taxation Profit/(loss) continuing operations (Loss)/profit discontinued operations Profit/(loss) for the period Attributable to: Equity holders Minority interests Q4 05/06 45 (7) (25) 13 13 (1) 12 Q4 04/05 44 (2) (35) (4) 3 27 30 2 32 FY 05/06 131 (33) (119) (5) (26) (12) (38) 60 22 FY 04/05 (24) 16 (137) (15) (160) 10 (150) 44 (106)

12 12 0.2p

31 1 32 0.5p

19 3 22 (0.7)p

(95) (11) (106) (2.4)p

EPS continuing basic and diluted

continuing adjusted1 Average number of shares

Note: 1.Before exceptional items and foreign exchange gains and losses.

0.6p 5,687m

0.3p 5,687m

0.7p 5,687m

0.1p 5,687m

Segmental analysis orders

million Orders CER % movement
FY 05/06 FY 04/05 Q4 FY

Q4 05/06

Q4 04/05

Controls

205

201

797

797

(3)%

(3)%

Process Systems
Rail Systems APV Eurotherm

233
131 96 32

179
82 108 29

798
504 419 119

675
454 390 122

20%
51% (14)% 3%

14%
9% 5% (5)%

Continuing operations

697

599

2,637

2,438

10%

5%

Memo:

Climate Appliance IMServ Controls

101 99 5 205

99 88 14 201

396 363 38 797

390 353 54 797

(4)% 4% (56)% (3)%

(1)% (2)% (29)% (3)%

Segmental analysis revenue, OPBIT

million Revenue OPBIT(1) Operating margin(1)
FY 05/06 FY 04/05 FY 05/06 FY 04/05

Q4 05/06

Q4 04/05

FY 05/06

FY 04/05

Q4 05/06

Q4 04/05

Controls Process Systems Rail Systems APV Eurotherm Corporate costs Continuing operations

205 203 136 107 31 682

202 177 105 99 31 614

788 725 438 388 118 2,457

810 655 412 360 122 2,359

19 30 24 2 6 (10) 71

25 20 16 6 6 (10) 63

64 81 65 16 (35) 191

85 43 61 5 17 (46) 165

8.1% 11.2% 14.8% 13.6% 7.8%

10.5% 6.6% 14.8% 1.4% 13.9% 7.0%

Memo: Climate Appliance IMServ Controls 101 98 6 205 102 87 13 202 387 363 38 788 400 356 54 810 3 2 12 8 31.6% 14.8%

Note: 1. Before exceptional items.

Free cash flow

million Q4 05/06 FY 05/06

Operating

Legacy

Total

Operatin g
191 20 57 14 (42) (22) 8 44 (44) 50 (33) (15)

Legacy

Total

Operating profit - continuing Operating profit - discontinued Depreciation Amortisation Net capital expenditure intangibles Share-based payment IAS 19 pension cost Pension contributions Working capital movement Restructuring costs Product recall costs - P, P & E -

71 3 15 3 (12) (4) 4 11 (11) 32 (9) (8)

(116) -

71 3 15 3 (12) (4) 4 11 (127) 32 (9) (8)

(146) -

191 20 57 14 (42) (22) 8 44 (190) 50 (33) (15)

Transition costs
Environmental & litigation settlements Operating cash flow Net finance costs Taxation paid Free cash flow

95 (43) (6) 46

2
(3) (117) (1) (118)

2
(3) (22) (43) (7) (72)

228 (110) (18) 100

(7)
(15) (168) (7) (175)

(7)
(15) 60 (110) (25) (75)

10

Debt financing at 31 March 2006 comprised

Maturity (years)
(1)

Effective Rate Cash (%)(2)

Drawn Cash million 694 115 1 277 113 25 14 1,239 (32) 1,207 (219) (58) (173) (450) 757

Drawn Non-cash million

(3)

Undrawn million (3)

High Yield 144A 144A 2nd Lien Term Loan B RCF Bonding Other debt Total gross debt (before costs & discount) High yield discount/debt issuance costs Total gross debt (after costs & discount) Escrow account (4) Cash collateral Other cash Total cash Net debt
Notes: 1. Excluding scheduled repayments. 2. L+ = margin over LIBOR. 3. Fee payable on drawn and undrawn amounts. 4. Cash subject to escrow restrictions on usage.

5.0 3.8 0.8 3.7 3.4 2.9 2.9

9.875% 6.500% 7.125% L + 4.75% L + 3.5% L + 3.0% L + 3.0%

277 277

208 108 316

11

Movement in legacy liabilities

million Taxation At 31 March 2003 At 31 March 2004 At 31 March 2005 At 31 Dec 2005 Cash (Credit)/charge(1) Disposals Market movements(2) 256 134 58 36 (1) (4) Litigation/ Environmental 140 107 71 63 (3) Transition 100 64 40 31 2 Discounting 204 Pensions 931 606 574 610 (123) (18) (3) 24

Exchange
At 31 March 2006

(1)
30

60

(1)
32

(1)
489

Notes: 1. The pension income statement charge comprises service cost, finance charge and settlement/curtailments for defined benefit schemes only. 2. Changes in value of investments and liabilities relating to defined benefit pension schemes.

12

Six month movement in IAS 19 liability

million At 30 September 2005 Contributions Service charge Return on assets/interest cost on liabilities UK Main (315) 113 (9) 3 US Main (127) 15 (4) (2) Other (167) 8 (4) (3) Total (609) 136 (17) (2)

Actual return on plan assets Expected return Return over expected return Changes in discount rate assumptions Experience gains arising on the benefit obligation:

237 (103) 134 (26)

13 (21) (8) 53

14 (7) 7 (4)

264 (131) 133 23

Mortality
Other Changes in mortality assumptions Changes in other assumptions Total actuarial and market movements Settlements and curtailments/disposals Exchange Closing balance

14
38 (160) (39) (39) 19 (228)

(10) (22) 13 (1) (106)

(1) 2 11 (2) (155)

14
27 (182) (39) (24) 30 (3) (489)

13

Pension obligations going forward

Agreement with UK Trustee Possible legislative change in USA

Refinancing

Operational review
Ulf Henriksson, CEO

15

Approach to create value

EPS

New set of opportunities for Invensys

Improved capital structure

Reduced legacy liabilities

Build a foundation
Understood & dealt with the past
P/E

Divested non core businesses Better execution efficiency Improved capabilities to grow Increased operating margin Much improved free cash flow

Invensys has built a firm foundation for future growth, but remains constrained by the limitations imposed by its current capital structure

16

Capabilities for growth

Orders received MAT *
2,700 2,600

Stable growth trend

Order growth in Q4 was 10% at CER Strong growth in Process Systems and Rail Systems

2,500 2,400 2,300

04 /0 5 Q 2 04 /0 5 Q 3 04 /0 5 Q 4 04 /0 5 Q 1 05 /0 6 Q 2 05 /0 6 Q 3 05 /0 6 Q 4 05 /0 6

Q 1

Good technical position and offering at Process Systems and Rail Systems
Controls showing further stabilisation Order book showing in excess of 1 billion excluding PPP/Rail Contract for London mass transport (PPP = 0.9bn) Effect of development of our people shows early signs of results
* Continuing operations

Order book MAT (ex PPP) *

1,100 1,000

900 800 700 600

Growing order book reflects customer confidence

04 /0 5 Q 2 04 /0 5 Q 3 04 /0 5 Q 4 04 /0 5 Q 1 05 /0 6 Q 2 05 /0 6 Q 3 05 /0 6 Q 4 05 /0 6

Q 1

17

Operating margins
Operating margins - MAT *
9

Steady progress

FY margins from 7.0% to 7.8%

Q4 margin was 10.4% Continued restructuring for efficiencies
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

%
7

04/05 04/05 04/05 04/05 05/06 05/06 05/06 05/06

Overheads % revenue MAT *

25 24 23

Maintaining focus on price, productivity and overhead to mitigate raw material cost inflation
Selected investment in overhead to transition gradually to growth mode

22 21 20

04 /0 5 Q 2 04 /0 5 Q 3 04 /0 5 Q 4 04 /0 5 Q 1 05 /0 6 Q 2 05 /0 6 Q 3 05 /0 6 Q 4 05 /0 6

Continued investment in operating margin improvement

Q 1

* Continuing operations

18

Cash flow
Operating cash flow pre legacy - MAT *
280 260 240 220 200 180 160 140 120

Our primary focus has been on accumulating cash FY operating cash flow pre legacy of 228m FY free cash flow pre legacy of 100m

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

04/05 04/05 04/05 04/05 05/06 05/06 05/06 05/06

Free cash flow pre legacy - MAT *

120 100

FY working capital inflow of 50m driven by improvements in contract balances. Second year in a row of working capital improvement Further improvement in linearity

80 60 40 20 0 (20)

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

04/05 04/05 04/05 04/05 05/06 05/06 05/06 05/06

* Total Group

Continued improvement in cash generation

19

Controls
Orders received *
* Excluding IBS
250 200

Background
Orders showing further stability Q4 orders flat at CER ex IMServ Margin decline to 9.3% Pricing pressures and raw material inflation Good progress on addressing manufacturing inefficiencies
205

201

150 100 50 0 Q4 04/05 Q4 05/06

Operating margin *
15 12

Sale of IBS US and Asia Pacific operations for 157m

12.4% 9.3%

Actions
Delivery performance

9 6 3 0 Q4 04/05 Q4 05/06

Moderation of pace of restructuring

Pricing adjustments Strengthening management team

We have a solid core and actions to address our issues

20

Process Systems
Orders received
250 200

Background
233

Orders continue to improve

Strong oil, gas and power markets Q4 orders up 20% at CER, with increases in all regions

179

150 100 50 0 Q4 04/05 Q4 05/06

Q4 revenue up 7% at CER
Q4 operating margin of 14.8% Actions
14.8% 11.3%

Operating margin
16 14 12 10

Continue drive for growth Launch of InFusionTM Enterprise Control System

8 6 4 2 0 Q4 04/05 Q4 05/06

Our investment in the foundation is paying off

21

InFusion

TM

For further information: http://www.infusionecs.com/

Proven technology makes an industry dream possible

22

APV
Orders received
120

Background
96

108

FY orders up 5% and revenue up 5% at CER

80

Q4 orders down due mainly to cancellation of 10m project

Small profit in Q4 making breakeven for FY
Q4 04/05 Q4 05/06

40

Operating margin
8

Warranty costs on some older contracts

Actions
6.1%

Reducing overhead to match future sales mix

1.9%

4 2 0 Q4 04/05 Q4 05/06

Manufacturing reorganisation
Increase technical presence in growing markets e.g. China

First phase of restructuring completed - second phase underway

23

Eurotherm
Orders received
40

Background
32

29

30 20 10 0 Q4 04/05 Q4 05/06

Orders stability with marginal uptick in Q4 after recent quarterly declines

Loss of drives distribution business Flat quarter on quarter margins Actions Refocus sales organisation Transfer manufacturing to low cost countries and outsourcing of capabilities

Operating margin
20 16 12

19.4%

19.4%

8 4 0 Q4 04/05 Q4 05/06

China facility to capture growth in Asia Pacific

Investing in stable business to achieve growth

24

Rail Systems
Orders received
150 125

Background
131

FY orders up 9% and revenue up 5% at CER

100 75 50 25 0

82

Q4 orders up 51% at CER; revenue up 25% at CER

Exceptional Q4 operating margin of 17.6%

Q4 04/05

Q4 05/06

Good cash flow

Operating margin
20

Actions
17.6%

15.2%
15

Continue to work with Network Rail on revised procurement Focus upon export markets Eastern Europe Latin America Asia Pacific

10 5 0 Q4 04/05 Q4 05/06

A strong business continuing to grow order book

2006 Refinancing

26

2004 Refinancing - what still affects us ?

Financial High interest costs absorb cash otherwise available for investment and shareholders High bonding costs put businesses at competitive disadvantage Lack of flexibility to pay down expensive debt and inefficient use of escrow account Lack of effective tax deductions for much interest income and inability to access income tax losses valued at 385 million Operational

Lingering issues with customer confidence (especially new customers) and level of competitor sniping
Covenants restrict ability to grow through organic investment / infill acquisitions / joint ventures and to have a normal conversation about growth with employees, customers and suppliers

27

The 2006 Refinancing

Rights Issue
Raising approximately 341 million
Fully underwritten by JPMorgan Cazenove, Morgan Stanley and HSBC

New Senior Secured Borrowing

HSBC, Bank of America, Deutsche Bank, Lloyds, RBS and Morgan Stanley

28

Key benefits of the Refinancing

Financial
Pro-forma cash interest cost down by 45m (charge down by 51m) No tax impact due to losses

Lower bonding costs

End of expensive escrow arrangement More flexible operational covenants Joint ventures Use of disposal proceeds

Developing normal banking relationships

Operational
Increased customer/ supplier confidence Strategic flexibility to partner Enabling enhanced dialogue with employees, customers and suppliers

Improved ability to attract and retain staff

29

Financial details of refinancing

30

The proposed refinancing is a significant step for the company

Pro-forma interest charge reduced from 116m to 65m p.a. Pro-forma EBITDA/interest charge ratio increases from 2.2 to 4.0 Pro-forma net debt (including IAS19 deficit)/market capitalisation ratio falls from 111% to 68% Debt maturity (excluding 144As) extended from March 09 to December 10 IBS proceeds of 157m will reduce borrowing further

31

Proposed refinancing comprises

1. Equity Rights Issue
- 2 for 5 at 15p - to raise 341m - allotment letters to be posted after the EGM on 14 June 2006

2. Repayment of High Yield Debt

- 35% of outstanding bonds, principal amount of 243m - at a price of 109.875% - notice to be given after the EGM

3. Tender for 144A Notes maturing 2010

- conditional tender launched today

32

Proposed refinancing comprises

4. Repayment of Senior Second Borrowing
- repayment of Term Loan B and outstandings under Bonding Facility, at par
- repayment of Second Lien Facility 101% - cancellation of RCF and Bonding Facility - repayment following receipt of rights issue proceeds

5. New Senior Secured Borrowing

- Term Loan Facility of 150m - Bonding Facility of 400m

- RCF of 150m
All subject to approval of the rights issue at 14 June 2006 EGM

33

Sources and uses of funds (based on 31 March 2006 data)

Sources
Rights issue
Senior Term Facility Escrow monies released m

Uses
High Yield (par value)
Term Loan B Second Lien Facility (par value)

341
150 219

243
113 277

Bonding loans
Cash

58
19

Bonding Loans
144A Note maturing 2010 Costs

25
64* 65 787

Total
* Excludes use of IBS proceeds

787

Total

34

Costs of the proposed refinancing

m Early debt redemption payments Underwriting costs Professional fees 27 26 6

General financial advice

Total

65

Based on exchange rates at 31 March 2006

35

Proforma 31 March 2006 debt financing assuming completion of proposed refinancing

Maturity Effective Drawn Drawn

(years)
High Yield 144A Term Loan RCF Bonding Other debt Total gross debt (before costs & discount) High yield discount/debt issuance costs Total gross debt (after costs & discount) Cash collateral Other cash Total cash Net debt
Notes: 1. L+ = margin over LIBOR. 2. Assuming 64m tender 3. Blended rate covering and $ borrowings

Rate
Cash (%)(1) 9.875% 6.500% L + 2.33%(3) L + 2.00% L + 2.25% or 2.00%

Cash
million 451 52(2) 150 58 14 725 (16) 709 (58) (154) (212) 497

Non-cash
million

Undrawn
million

5.0 3.8

277

150 65

277

215

36

Proforma interest charge on proforma 31 March 2006 debt financing

Under proposed financing Effective rate1 Drawn million 451 52 Undrawn million Charge million 45 3 Under current financing Drawn million 694 116 Undrawn million Charge million 69 8

Capital Market debt

High Yield 144A Facilities to be repaid 2nd Lien Term Loan B RCF undrawn Bonding2 Facilities to be established Term loan3 RCF Bonding4 Other Other debt Escrow Cash collateral Other cash Sub-total of interest charges Amortisation of fees (non cash) Pro forma net finance costs Notes: 1 L = LIBOR. 2 Interest includes commitment fee of 1.00% on undrawn amount. 3 Blended rate covering and $ borrowings. 4 Margin 2.25% on funded facility and 2.0% on balance. Over term 10.00% LIBID LIBID LIBID (58) (154) (2) (6) 61 4 65 14 1 14 (219) (58) (173) 1 (8) (2) (7) 106 10 116 L+2.330% 0.750% L+2.250%/2.00% 335 150 150 65 9 1 10 L+4.750% L+3.500% 1.000% L+3.000% 302 277 113 208 108 24 8 2 11 9.875% 6.500%

37

Summary

38

Summary
Invensys has made considerable progress since the 2004 refinancing Operational performance has improved, as evidenced by the 2006 results Liabilities have been sharply reduced and a funding agreement has been reached with the UK pension Trustee

The terms of the 2004 Refinancing were onerous, reflecting the Groups difficulties at that time
These terms are a limitation on Invensys ability to compete on an equal footing with its competitors The 2006 Refinancing will result in a more normalised capital structure and will give the Group a firm basis from which to invest in its future and to generate shareholder value

Q&A
25 May 2006

Appendices

41

IAS 19 pension charge

million Q4 05/06 Service cost(1) current/past - current/past - past credit 11 1 (8) Q4 04/05 10 2 FY 05/06 40 5 (8) FY 04/05 39 10 Operating profit continuing Loss/profit discontinued Other operating exceptional items

Settlements and curtailments:

(18)

(1)

(23)

(9)

Corporate exceptionals(2)

IAS 19 finance charges Total

(14)

4 15

5 19

15 55

Note: 1. Includes defined contribution charge of 3m (Q4 04/05: 2m; FY 05/06: 9m; FY 04/05: 8m). 2. Comprises other operating exceptionals and loss/profit on discontinued operations.

42

Profit discontinued operations 12 months to 31 March 2006

million Revenue Lambda ABS EMEA APV Baker IBS USA and Asia Pacific Other 107 29 47 73 256 OPBIT Lambda ABS EMEA APV Baker IBS USA and Asia Pacific Other Exceptional items 10 1 (2) 11 11 4 (2) 9 (3) 229 92 50 73 120 564 FY 05/06 FY 04/05

20
(2)

19
(10)

Taxation
Profit on assets divested Charge of associated goodwill Settlements and curtailments credit IAS 19 Foreign exchange gain/(loss) transferred on disposal of operations Profit - discontinued operations

(2)
115 (91) 19 1 60

5
162 (137) 8 (3) 44

43

Discontinued profit on disposal 12 months to 31 March 2006

million Proceeds Net assets divested/ costs Profit/(loss) on net assets Goodwill capitalised Foreign exchange gain transferred from equity (Loss)/ profit

Lambda

134

(54)

80

(82)

(1)

ABS EMEA
APV Baker Total

85
(7) 212

(28)
4 (78)

57
(3) 134

(9)
(91)

48
(3) 44

44

Net finance costs 05/06

million Income statement Q4 05/06 Bank debt Capital market debt Refinancing costs facility fees Change in fair value of investments Other Finance income 16 19 2 (2) 1 (11) 25 FY 05/06 64 75 9 (3) 5 (31) 119 Cashflow Q4 05/06 12 38 2 2 (11) 43 FY 05/06 57 76 2 5 (30) 110

45

Free cash flow

million Q4 04/05 FY 04/05

Operating
Operating profit - continuing Operating profit - discontinued Depreciation Amortisation 63 8 16 3

Legacy
-

Total
63 8 16 3

Operating
165 19 69 13

Legacy
-

Total
165 19 69 13

Net capital expenditure

intangibles Share based payments IAS 19 pension cost Pension contributions Working capital movement Restructuring costs Refinancing costs Product recall costs

- P, P & E
-

(16)
(3) 2 11 (11) 63 (16) (2)

(30) -

(16)
(3) 2 11 (41) 63 (16) (2)

(58)
(16) 2 48 (48) 51 (45) (8) (4)

(83) -

(58)
(16) 2 48 (131) 51 (45) (8) (4)

Transition costs
Environmental & litigation settlements Operating cash flow Net finance costs Taxation paid Free cash flow

118 (55) (7) 56

(5)
(35) (37) (72)

(5)
83 (55) (44) (16)

188 (113) (36) 39

(24)
(34) (141) (40) (181)

(24)
(34) 47 (113) (76) (142)

46

Reconciliation of free cash flow to IAS 7 net cash flow from operating activities
million Q4 05/06 Free cash flow Add back: Finance income Net capital expenditure Deduct: Disposal working capital movement Disposal of continuing operations Net cash flow from operating activities (IAS 7) (72) (11) 19 (64) Q4 04/05 (16) (5) 19 (2) FY 05/06 (75) (30) 68 (14) 2 (49) FY 04/05 (142) (18) 76 (11) (95)

47

Balance sheet
million
Property, plant and equipment Intangible assets goodwill Intangible assets - other(1) Net trading assets Deferred taxation Net pension liability Net assets held for sale 31 Mar 06 348 222 81 651 (23) (9) (489) 130 29 159 Shareholders deficit - equity Minority interests Total equity Net debt(2) (659) 66 (593) 752 159 31 Dec 05 377 230 82 689 10 (10) (610) 79 4 83 (655) 65 (590) 673 83 30 Sep 05 375 228 80 683 41 (10) (609) 105 1 106 (651) 67 (584) 690 106 31 Mar 05 434 310 83 827 84 (11) (574) 326 326 (609) 133 (476) 802 326

Note: 1. Includes intangible development costs of 74m; 31 Dec 05 74m; 30 Sep 05 72m; 31 Mar 05 66m. 2. 5m of debt is included with net assets held for sale

48

Movement in net debt

million Q4 05/06 Q4 04/05 FY 05/06 FY 04/05

Opening net debt Free cash flow - operating - legacy Dividends paid to minorities Acquisition costs Net divestment proceeds(1)(2)

(673) 46 (118) (6) (2)

(768) 56 (72) (13) (1) (3) (3)

(802) 100 (175) (4) (1) 184 (7)

(997) 39 (181) (14) (2) 352 2 (7)

Transfer of facility fees from prepayments Amortisation of facility fees within debt

Currency movement
Closing net debt

(4)
(757)

2
(802)

(52)
(757)

6
(802)

Note: 1. Including net cash divested (Q4 05/06 1m; Q4 04/05 nil; FY 05/06 10m; FY 04/05 18m). 2. Including pre-disposal working capital movement (Q4 05/06 nil; Q4 04/05 nil; FY 05/06 (14)m; FY 04/05 (11)m).

49

Currency of net debt, finance rate fixing

Drawn at 31 March 2006 Effective currency million High Yield 144A 144A 2nd lien Term Loan B RCF Size 694 115 1 277 113 208 Maturity Mar-11 Jan-10 Jan-07 Dec-09 Sep-09 Mar-09 Fixed / Variable Fixed Fixed Fixed Variable Variable Variable USD 316 115 1 172 86 EURO 378 105 27 JPY GBP Other Total 694 115 1 277 113 -

Bonding
Cash/other

410

Mar-09

Variable

(183) 507

12
(117) 405 (12) 393 (8) 385

(16) (16) (16) 11 (5)

13
(47) (34) (34) (1) (35)

(73) (73) (73) 61 (12)

25
(436) 789 (32) 757 109 (109) 1 758

High yield discount/debt issuance costs Net debt IR swaps fixed IR swaps variable FX swaps Economic net debt

(20) 487 109 (109) (62) 425

50

Intangible development costs by Business Group - movement

Quarter million Opening NBV 31 Dec 2005 Process Systems Rail Systems Continuing operations 11 63 74 1 1 2 (2) (2) 12 62 74 Closing NBV Additions Amortisation Exchange 31 Mar 2006

Year million Opening NBV 1 April 2005 Additions Amortisation Exchange Closing NBV 31 Mar 2006

Process Systems
Rail Systems Continuing operations

9
57 66

5
13 18

(2)
(9) (11)

1 1

12
62 74

Note: In addition to these intangible development costs, there is 9m of computer software and concessions/trademarks included within the balance sheet caption Intangible assets other (31 Dec 2005: 8m; 1 April 2005: 17m).

51

Controls
million

Q4 05/06

Q3 05/06

Q2 05/06

Q1 05/06

Q4 04/05

Q3 04/05

Q2 04/05

Q1 04/05

Orders
Revenue OPBIT % Revenue Restructuring costs Capex P,P&E Capex intangible Depreciation Amortisation

205
205 19 9.3% 11 7 1 6 -

198
200 15 7.5% 6 6 1

202
199 18 9.0% 5 3 7 -

192
184 12 6.5% 4 6 -

201
202 25 12.4% 7 5 7 -

193
199 16 8.0% 4 6 7 1

199
209 28 13.4% 9 4 7 -

204
200 16 8.0% 5 4 7 -

52

Process Systems
million

Q4 05/06

Q3 05/06

Q2 05/06

Q1 05/06

Q4 04/05

Q3 04/05

Q2 04/05

Q1 04/05

Orders

233

200

189

176

179

164

165

167

Revenue
OPBIT

203
30

183
22

179
17

160
12

177
20

162
8

163
12

153
3

% Revenue
Restructuring costs Capex P,P&E Capex intangible Depreciation Amortisation

14.8%
4 6 1 4 -

12.0%
2 2 1 3 1

9.5%
1 3 2 4 1

7.5%
2 1 2 3 1

11.3%
4 5 1 4 1

4.9%
1 2 1 3 -

7.4%
2 1 3 1

2.0%
1 2 1 3 1

53

Rail Systems
million

Q4 05/06

Q3 05/06

Q2 05/06

Q1 05/06

Q4 04/05

Q3 04/05

Q2 04/05

Q1 04/05

Orders
Revenue OPBIT % Revenue Restructuring costs Capex P,P&E Capex intangible Depreciation Amortisation

131
136 24 17.6% 1 2 2

133
103 18 17.5% 1 4 1 2

124
101 13 12.9% 4 1 2

116
98 10 10.2% 1 5 1 3

82
105 16 15.2% 2 2 3 1 2

181
100 16 16.0% 3 1 2

80
103 14 13.6% 2 3 1 3

111
104 15 14.4% 1 4 1 1

54

APV
million

Q4 05/06

Q3 05/06

Q2 05/06

Q1 05/06

Q4 04/05

Q3 04/05

Q2 04/05

Q1 04/05

Orders Revenue OPBIT % Revenue Restructuring costs Capex P,P&E Capex intangible Depreciation Amortisation

96 107 2 1.9% 2 1 1 2 1

99 96 (4) (4.2)% 7 1 2 -

113 95 1 1.1% 3 1 2 -

111 90 1 1.1% 1 1 1 -

108 99 6 6.1% 3 2 1 1 -

79 87 7 8.0% 6 1 2 -

118 92 3 1 1 -

85 82 (8) (9.8)% 2 2 2 -

55

Eurotherm
million

Q4 05/06

Q3 05/06

Q2 05/06

Q1 05/06

Q4 04/05

Q3 04/05

Q2 04/05

Q1 04/05

Orders
Revenue OPBIT % Revenue Restructuring costs Capex P,P&E Capex intangible Depreciation Amortisation

32
31 6 19.4% 3 -

28
29 3 10.3% 1 1 -

29
30 4 13.3% 1 -

30
28 3 10.7% 1 -

29
31 6 19.4% 1 -

32
31 4 12.9% 1 -

30
32 4 12.5% -

31
28 3 10.7% 1 1 -

56

Orders at constant exchange rates (CER) FY and Q4

million Controls Process Systems Rail Systems APV Eurotherm Corporate Continuin g Operation s

Q4 Q4 04/05 Exchange 201 13 179 13 82 4 108 4 29 2 599 36

Q4 04/05 adjusted base

CER movement Q4 05/06 CER movement %(1)

214
(9) 205 (3)%

192
41 233 20%

86
45 131 51%

112
(16) 96 (14)%

31
1 32 3%

635
62 697 10%

Full Year FY 04/05 797 675 454 390 122 2,438

Exchange
FY 04/05 adjusted base CER movement FY 05/06 CER movement %(1)

26
823 (26) 797 (3)%

25
700 98 798 14%

8
462 42 504 9%

11
401 18 419 5%

3
125 (6) 119 (5)%

73
2,511 126 2,637 5%

Note: 1. CER movement % calculated using 000s.

57

Revenue and OPBIT at constant exchange rates (CER) Q4

million Controls Process Systems Rail Systems APV Eurotherm Corporate Continuin g Operation s

Revenue Q4 04/05 Exchange 202 12 177 13 105 3 99 4 31 1 614 33

Q4 04/05 adjusted base

CER movement Q4 05/06 CER movement %(1)

214
(9) 205 (4)%

190
13 203 7%

108
28 136 25%

103
4 107 4%

32
(1) 31 (3)%

647
35 682 5%

OPBIT Q4 04/05 Exchange Q4 04/05 adjusted base CER movement Q4 05/06 CER movement %(1) 25 25 (6) 19 (27)% 20 1 21 9 30 46% 16 1 17 7 24 45% 6 6 (4) 2 (67)% 6 6 6 1% (10) (10) (10) 1% 63 2 65 6 71 9%

Note: 1. CER movement % calculated using 000s.

58

Revenue and OPBIT at constant exchange rates (CER) FY

million Controls Process Systems Rail Systems APV Eurotherm Corporate Continuin g Operation s

Revenue FY 04/05 Exchange 810 26 655 25 412 7 360 10 122 2 2,359 70

FY 04/05 adjusted base

CER movement FY 05/06 CER movement %(1)

836
(48) 788 (6)%

680
45 725 7%

419
19 438 5%

370
18 388 5%

124
(6) 118 (5)%

2,429
28 2,457 1%

OPBIT FY 04/05 Exchange FY 04/05 adjusted base CER movement FY 05/06 CER movement %(1) 85 3 88 (24) 64 (28)% 43 1 44 37 81 85% 61 1 62 3 65 5% 5 1 6 (6) (100)% 17 1 18 (2) 16 (8)% (46) (46) 11 (35) 23% 165 7 172 19 191 11%

Note: 1. CER movement % calculated using 000s.

59

Exchange rates
Period ends
Mar 2006 Dec 2005 Sept 2005 June 2005

Averages
March FY 05/06 Q4 05/06 FY 04/05 Q4 04/05 2005

US$

1.74

1.73

1.77

1.79

1.89

1.79

1.76

1.85

1.89

uro

1.43

1.46

1.47

1.48

1.45

1.46

1.43

1.47

1.45

en

205

203

201

198

202

202

205

198

199