Report of the Board to the

shareholders on directors'

remuneration

of the different parts of the business for which the executive directors are

responsible and the extent to which the strategic objectives set by the

Board are being met.  There were no bonuses paid for performance in the

year to 30 June 2001.  A performance bonus of  30,000 was paid to

Jonathan Robinson in relation to the year ended 30 June 2000.

Share options

Share option allocations are designed to attract, motivate and retain

employees.

Directors' pension

Up to 10% of salary is paid by the company into directors' personal

arrangements

pension schemes.

Directors' contracts

Each executive and director has a six month rolling service contract.  The

company may have a contractual obligation to pay compensation for the

unexpired portion of a director's contract, if it is terminated early.  No

other payments are made for compensation for loss of office.

Non executive

All non executive directors have 12 month rolling contracts.

directors

Remuneration is determined by the Board within the limits set out in the

Articles of Association and based upon independent surveys of fees paid

to non executive directors' of similar companies.  The fee paid to each

non executive director in the year was  10,000 with the exception of

Ivan Pope who received an additional  30,000 for his services as

temporary chairman during the year, and Tim Ashley who received no

fee.  Non executive directors do not participate in any of the company's

share option schemes.

Details of directors'

This report should be read in conjunction with note 4 to the accounts

remuneration and

which also constitutes part of this report giving full details of the amounts

share options

in the remuneration package of each director and details of each

director's share options.

By order of the Board

A Sparshatt

Company Secretary

21 September 2001

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