Shareholder FAQ

What is the Company’s registered Office and company number ?

The Company’s registered Office and company number is:

2 Cavendish Square
London
W1G 0PX
United Kingdom

Registered in England
company number 2342138

Who are the Company’s registrars ?

Shareholder enquiries relating to shareholding, dividend payments, change of address, loss of share certificate, etc. should be addressed to Computershare Investor Services PLC at their address below:

Computershare Investor Services PLC
PO Box No 82
The Pavilions
Bridgwater Road
Bristol BS99 7NH

Who are the Company’s Auditors ?

The company's auditors are currently PricewaterhouseCoopers. Their contact address is as follows:

PricewaterhouseCoopers
1 Embankment Place
London WC2N 6RH

Who are the Company’s Principal UK bankers ?

The Company’s Principal UK bankers are currently The Royal Bank of Scotland, Barclays Bank and Bank of Scotland. Their contact addresses are as follows:

The Royal Bank of Scotland plc
135 Bishopsgate
London EC2M 3UR

Barclays Bank plc
1 Churchill Place
Canary Wharf
London
E14 5HP

Bank of Scotland Corporate
Level 7 – Bishopgate Exchange
155 Bishopgate
London
EC2M 3YB

Who are the Company’s Investment Bankers ?

The Company's investment bankers are currently JPMorgan Cazenove and Hawkpoint Partners whose contact addresses are:

JPMorgan Cazenove
20 Moorgate
London EC2R 6DA

Hawkpoint Partners Limited
41 Lothbury
London EC2R 7AE

Who are the Company’s stockbrokers ?

the Company’s stockbrokers are currently JPMorgan Cazenove whose contact address is as follows:

JPMorgan Cazenove Group PLC
20 Moorgate
London EC2R 6DA

Is there a share dealing service for shares in Babcock ?

Share dealing service
The following share dealing services are available through our Registrars, Computershare Investor Services PLC:

Internet share dealing
This service provides shareholders with an easy way to buy or sell Babcock International Group PLC ordinary shares on the London Stock Exchange. The commission is 0.5%, subject to a minimum charge of £15.00. In addition stamp duty, currently 0.5%, is payable on purchases. There is no need to open an account in order to deal. Real time dealing is available during market hours. In addition there is a facility to place your order outside of market hours. Up to 90 day limit orders are available for sales. To access the service log on to www.computershare.com/dealing/uk. Shareholders should have their Shareholder Reference Number (SRN) available. The SRN appears on share certificates. A bank debit card will be required for purchases. Please note that, at present, this service is only available to shareholders in certain European jurisdictions. Please refer to the website for an up-to-date list of these countries.

Telephone share dealing
Please note that this service is, at present, only available to shareholders resident in the UK and Ireland. The commission is 1%, subject to a minimum charge of £15.00. In addition, stamp duty, currently 0.5%, is payable on purchases. The service is available from 8.00 am to 4.30 pm Monday to Friday, excluding bank holidays, on telephone number 0870 703 0084. Shareholders should have their Shareholder Reference Number (SRN) ready when making the call. The SRN appears on share certificates. A bank debit card will be required for purchases. Detailed terms and conditions are available on request by telephoning 0870 702 0000.

These services are offered on an execution only basis and subject to the applicable terms and conditions. This is not a recommendation to buy, sell or hold shares in Babcock International Group PLC. Shareholders who are unsure of what action to take should obtain independent financial advice. Share values may go down as well as up which may result in a shareholder receiving less than he/she originally invested.

To the extent that this statement is a financial promotion for the share dealing service provided by Computershare Investor Services PLC, it has been approved by Computershare Investor Services PLC for the purpose of section 21 (2) (b) of the Financial Services and Markets Act 2000 only. Computershare Investor Services PLC is authorised and regulated by the Financial Services Authority.

Where this notice has been received in a country where the provision of such a service would be contrary to local laws or regulations, this should be treated as information only.

What are the terms of reference of the Remuneration committee ?

Terms of Reference
(As of May 2004 as amended to reflect the establishment by the Board on 24th January 2005 of a separate Nominations Committee)



1. General Statement

The Remuneration Committee ("the Committee") makes recommendations to the Board on Group Policy on executive remuneration and determines on behalf of the Board the terms of service (using this expression in its widest sense), including the terms upon which such service is terminated, of (a) the Chairman and the Executive Directors of the Company, (b) the Divisional Managing Directors, and (c) certain senior Head Office executives (“the Executives”).

In so doing the Committee will endeavour to encourage the Executives to enhance the Group's performance (and, in the case of the Divisional Managing Directors, the performance of their businesses), ensuring that they are fairly rewarded for the contribution they each make to such performance. It will report and account to shareholders annually on Directors' remuneration generally.

The Chairman of the Committee should ensure that the Company maintains contact with its principal shareholders about remuneration in the same way as for other matters.


2. Composition, Quorum and Access to External Advice

All the Non-Executive Directors (but excluding any such Director who is not deemed by the Board to be independent of management) operating with a quorum of three. The Group Chairman and the Chief Executive will if practicable be in attendance (but not as a members of the Committee, and each will not be present when his own remuneration or terms of employment are discussed).

Executive Directors may attend by invitation but none shall count towards a quorum and no one shall be present when his own remuneration or appointment is being discussed.

The Group Company Secretary and General Counsel is Secretary to the Committee and is responsible for servicing the meetings and producing the minutes.

The Committee shall have access to such information and advice, at the cost of the Company, both from within the Group and externally as, after discussion with the Group Chairman, it deems necessary.

3. Frequency of Meetings

The Committee shall meet at least twice in each year and otherwise as required.

4. Terms of Reference

After consultation with the Chief Executive and, where appropriate, the Group Chairman: -

(i) to determine and recommend to the Board the Group's policy on executive remuneration. The term "executive remuneration" is deemed to include levels of pay, service contracts and all other benefits, including (without limitation) share options and other long term incentive plans of any kind ("LTIPs"), pensions, allowances, gratuities, life assurances, bonuses and severance packages;

(ii) to deal in all respects with:

(a) the terms of service of the Chairman and the Executive Directors including their remuneration, as defined in (i) above, and the termination of their employment having regard to the severance policy adopted by the Board;

the Committee shall consider the advantages of providing explicitly in the initial contract for compensation commitments in the event of early termination, except in the case of removal for misconduct; where there is no explicit provision for compensation commitments, the Committee shall, within legal constraints, tailor their approach to the individual circumstances, dealing fairly where cases of departure are not due to poor performance whilst not rewarding poor performance and having regard to reducing compensation to reflect the departing director’s duty to mitigate loss where reasonable in the circumstances;

(b) the terms of service of the Divisional Managing Directors and of certain senior Head Office executives (members of the Group’s Executive Committee) and the termination of their employment.

(iii) to report and account directly to shareholders, on behalf of the Group Board, for Directors' remuneration by way of the Company’s annual report (to form part of the Directors’ report);

(iv) to approve the terms of and basis of participation in short and long term incentive schemes for which the Chairman and/or the Executive Directors and/or senior executives are eligible; to set performance criteria for the granting, vesting or execution of awards or options under any existing or new Executive Share Option Scheme or other LTIP and to review annually the bonus arrangements for the Executives including whether there ought to be an upper limit on the maximum bonus payable in respect of any one year;

(v) to grant options or awards under any Employee Share Scheme , LTIP (other than the All Employee Share Schemes);

(vi) to delegate to such person or persons as the Committee may deem appropriate the administration powers necessary to give effect to the grant of options or awards decided upon by the Committee;

(vii) to grant or delegate the power to grant dispensations in respect of leavers exercising rights under long term incentive schemes, or long-term incentive plans, including options or awards under Share Option Schemes or LTIPs;

(ix) to keep under review market practice on notice periods under Executive Directors’ service agreements;

(x) to consider the pension consequences of, and (where relevant) the contribution payable by, the Company to any funded supplementary pension scheme relating to proposed salary increases for Executive Directors; and

From time to time as deemed appropriate, to review the Company’s position on remuneration and benefits with other comparable companies, bearing in mind that any improvements in remuneration and terms as a result should reflect improved performance.


NOMINATIONS COMMITTEE

Terms of Reference
(As established by the Board on 24th January 2005)

Membership:

The committee shall consist of the Chairman of the Company and all the non-executive directors of the company provided that there shall be a majority of non-executive directors considered by the company to be independant . The Chairman shall chair the committee, except when it is dealing with the appointment of his successor.

Responsibility:

The Committee shall:

· be responsible for identifying and nominating for the approval of the board, candidates to fill board vacancies as and when they arise;

· evaluate the balance of skills, knowledge and experience on the board and, in the light of this evaluation, prepare a description of the role and capabilities required for a particular appointment;

· review annually the time required from a non-executive director for performance of his duties to the company;

· give full consideration to succession planning in the course of its work, taking into account the challenges and opportunities facing the company and what skills and expertise are needed on the board in the future;

· review regularly the structure, size and composition (including the skills, knowledge and experience) of the board and make recommendations to the board with regard to any changes;

· keep under review the leadership needs of the Group, both executive and non-executive, with a view to ensuring the continued ability of the Group to compete effectively in the market place;

· make a statement in the annual report about its activities.

The Committee shall make recommendations to the board:

· as regards plans for succession for both executive and non-executive directors;

· as regards the re-appointment of any non-executive director at the conclusion of their specified term of office;

· concerning the re-election by shareholders of any director under the retirement by rotation provisions in the company’s articles of association;

· concerning any matters relating to the continuation in office of any director at any time; and

· concerning the appointment of any director to executive or other office other than to the positions of chairman and chief executive, the recommendation for which would be considered at a meeting of the board.

What are the terms of reference of the Audit and Risk committee ?

Terms of Reference (as of May 2004)


Membership

1.The committee is appointed by the board. All members of the committee shall be non-executive directors of the company other than non-executives deemed by the Board not to be independent directors. The committee shall consist of not less than three members. A quorum shall be two members.

2.The chairman of the committee shall be appointed by the board from amongst the independent non-executive directors.


Attendance at meetings

3.The finance director, head of internal audit (or an appointed representative of any firm providing internal audit services) and a representative of the external auditors shall attend meetings at the invitation of the committee.

4.The chairman of the board, the CEO and other board members and executives of the company shall attend if invited by the committee.

5.At least one meeting per year, or part thereof, will take place with external auditors in attendance without management present.

6.The company secretary shall be secretary of the committee.


Frequency of meetings

7.Meetings shall be held not less than three times a year, and where appropriate will coincide with key dates in the company’s financial reporting cycle.

8.External auditors or internal auditors may request a meeting if they consider that one is necessary.


Authority

9.The committee is authorised by the board to:

a.Investigate any activity within its terms of reference;

b.Seek any information that it requires from any employee of the company and all employees are directed to cooperate with any request made by the committee; and

c.Obtain outside legal or independent professional advice and such advisors may attend meetings as necessary.


Responsibilities

10.The responsibilities of the committee shall be:

a.To consider the appointment of the external auditor and assess independence of the external auditor, ensuring that key partners are rotated at appropriate intervals;

b.To recommend the audit fee to the board and pre-approve (above any limits previously agreed by the Committee or not delegated to the Chairman of the Committee for approval) any fees in respect of non audit services provided by the external auditor (or by any firm providing internal audit services) and to ensure that the provision of non audit services does not impair the external auditors’ (or, as the case may be, the firm providing internal audit services) independence or objectivity;

c.To discuss with the external auditor, before the audit commences, the nature and scope of the audit and to review the auditors’ quality control procedures and steps taken by the auditor to respond to changes in regulatory and other requirements;

d.To oversee the process for selecting the external auditor (and any firm providing internal audit services) and make appropriate recommendations through he board to the shareholders to consider at the AGM;

e.To review the external auditor’s management letter and management’s response;

f.To review the internal audit programme and ensure that the internal audit function (whether carried out by permanent employees of the Group or by a professional firm providing internal audit services) is adequately resourced and has appropriate standing within the company;

g.To consider management’s response to any major external or internal audit recommendations;

h.To approve the appointment or dismissal of the head of internal audit or of any firm engaged to provide internal audit services;

i. To review the company’s procedures for handling allegations from whistleblowers;

j.To review management’s and the internal auditor’s reports on the effectiveness of systems for internal financial control, financial reporting and risk management;

k.To review, and challenge where necessary, the actions and judgements of management, in relation to the interim and annual financial statements before submission to the board, paying particular attention to:

i.critical accounting policies and practices, and any changes in them
ii.decisions requiring a major element of judgement
iii.the extent to which the financial statements are affected by any unusual transactions in the year and how they are disclosed.
iv. the clarity of disclosures
v. significant adjustments resulting from the audit
vi. the going concern assumption
vii. compliance with accounting standards
viii.compliance with stock exchange and other legal requirements
ix.reviewing the company’s statement on internal control systems prior to endorsement by the board and to review the policies and process for identifying and assessing business risks and the management of those risks by the company; and

l.To consider other topics, as referred to it by the board


Reporting procedures

11.The secretary shall circulate the minutes of meetings of the committee to all members of the board, and the chairman of the committee or, as a minimum, another member of the committee, shall attend the board meeting at which the accounts are approved.

12.The committee members shall conduct an annual review of their work and these terms of reference and, if appropriate, make recommendations to the board following such review.

13.The committee’s duties and activities during the year shall be disclosed in the annual financial statements.

14.The chairman of the committee shall attend the AGM and shall, if required, answer questions, through the chairman of the board, on the audit committee’s activities and their responsibilities.

What are the terms of reference of the Nominations committee ?

Terms of Reference
(As established by the Board on 24th January 2005)

Membership:

The committee shall consist of the Chairman of the Company and all the non-executive directors of the company provided that there shall be a majority of non-executive directors considered by the company to be independant . The Chairman shall chair the committee, except when it is dealing with the appointment of his successor.

Responsibility:

The Committee shall:

· be responsible for identifying and nominating for the approval of the board, candidates to fill board vacancies as and when they arise;

· evaluate the balance of skills, knowledge and experience on the board and, in the light of this evaluation, prepare a description of the role and capabilities required for a particular appointment;

· review annually the time required from a non-executive director for performance of his duties to the company;

· give full consideration to succession planning in the course of its work, taking into account the challenges and opportunities facing the company and what skills and expertise are needed on the board in the future;

· review regularly the structure, size and composition (including the skills, knowledge and experience) of the board and make recommendations to the board with regard to any changes;

· keep under review the leadership needs of the Group, both executive and non-executive, with a view to ensuring the continued ability of the Group to compete effectively in the market place;

· make a statement in the annual report about its activities.

The Committee shall make recommendations to the board:

· as regards plans for succession for both executive and non-executive directors;

· as regards the re-appointment of any non-executive director at the conclusion of their specified term of office;

· concerning the re-election by shareholders of any director under the retirement by rotation provisions in the company’s articles of association;

· concerning any matters relating to the continuation in office of any director at any time; and

· concerning the appointment of any director to executive or other office other than to the positions of chairman and chief executive, the recommendation for which would be considered at a meeting of the board.

What do I need to do if I change my name and/or address ?

If you are a private shareholder, please write to Computershare Registrars at Computershare Investor Services PLC, PO Box No 82, The Pavilions, Bridgwater Road, Bristol BS99 7NH, giving:

· The company’s name: Babcock International Group PLC.
· Full details of both your old and new names. Please ensure that you give your old name in exactly the form in which it is recorded on the Register of Shareholders - this can be seen on your share certificate or dividend counterfoil. Note - if you have more than one certificate for shares in the company, it could well be that your personal details are recorded differently on each certificate
· Your Investor Code - which can be found on your share certificates or dividend counterfoil.

Enclose:
· Share certificate(s) representing your total holding plus one of the following as appropriate:
- An original Marriage Certificate
- An original Deed Poll
- A Statutory Declaration is acceptable if it bears both your old and new signatures.

If a married woman wishes to revert to her maiden name after divorce the registrars will require:
· A copy of the decree absolute together with her marriage certificate (to confirm her previous name), or
· A copy of the decree absolute together with her birth certificate if the marriage certificate is not available

Should you change your address you will need to advise our registrars, Computershare Investor Services PLC

How do I report the death of a registered holder ?

The documentation required to register the death of a shareholder is dependant on the type of shareholding. Please write to Computershare Registrars at Computershare Investor Services PLC, PO Box No 82, The Pavilions, Bridgwater Road, Bristol BS99 7NH stating:
· The full name of the shareholder, as shown on each of their share certificate(s).
· The company’s name: Babcock International Group PLC.

If the account is held solely in the name of the Deceased, enclose one of the following:
· Sealed copy Grant of Probate or Letters of Administration.
· For Scottish residents the equivalent document is a Certificate of Confirmation.
· Share certificate(s) representing total holding.

Alternatively if Probate (or the equivalent) is not being sought due to the small value of the estate, you can apply to use a Small Estate Procedure, providing the total value of the UK estate is under £20,000 and the total value within the estate of shares is under £10,000.

If the account was held jointly with another person then enclose:
· Death certificate.
· Share certificate(s) for amendment.

How do I transfer my shares to a friend or relation ?

In order to carry out a private share transfer you will need to complete a stock transfer form issued by our registrars (Computershare Investor Services PLC at Computershare Investor Services PLC, PO Box No 82, The Pavilions, Bridgwater Road, Bristol BS99 7NH).

How can I replace my lost / stolen share certificate ?

If you need to replace a share certificate, please write to our registrars (Computershare Investor Services PLC at Computershare Investor Services PLC, PO Box No 82, The Pavilions, Bridgwater Road, Bristol BS99 7NH.

Who are the major customers of Babcock ?

The largest single customer for Babcock is the British Government. Within the British Government our largest customers are the Ministry of Defence (especially the Defence Equipment & Support (DE&S) (formerly the Defence Logistics Organisation and Defence Procurement Agency) and Defence Estates organisations), Network Rail and the Scottish Executive.

In the commercial sector significant customers included BAA, Eskom, National Grid, Orange, Vodafone and Volvo. Our contracts may be with the highest level or with the subsidiary agencies of these customers.

How many employees does Babcock have ?

As of March 31, 2006, Babcock employed approximately 8,763 operational and administrative and managerial employees.

What acquisitions and disposals have babcock conducted ?

During the past seven financial years Babcock has made the following acquisitions and disposals;

2006/07
26th Jan, International Nuclear Solutions PLC (24.5% purchase)
13th June, ABB powerlines
9th May, Alstec Group
11th April, IETG, EPS Gmbh, Eve Trakway [disposal]

2005/06
25th July, Pivotal Group [disposal]

2004/05
10th September, Turner & Partners
18th June, Peterhouse Group PLC

2003/04
7th November, BMH Marine AB [disposal]

2002/03
2nd December, BMH Chronos Richardson [disposal]
5th August, MEF
19th June, Service Group International Limited

2001/02
4th February, AKI [disposal]
18th January, CMR Consultants
2nd January, BMH Technologies (cement handling) [disposal]
30th August, BMH Technologies (wood operations) [disposal]
9th April, Railcare [disposal]

2000/01
9th March, Hunting Defence Services
18th September, Babcock Energy Limited [disposal]

What is the dividend track record of Babcock ?

The interim and final dividend payments per 60p share from financial years 2001/02 through 2006/07 are listed below;

Interim Final Total Percentage change
2006/07
2.40p 5.65p* 8.05p +34.2%

2005/06
1.75p 4.25p 6.00p +50.0%

2004/05
1.35p 2.65p 4.00p +19.4%

2003/04
1.25p 2.10p 3.35p +11.7%

2002/03
1.15p 1.85p 3.00p +5.26%

2001/02
1.10p 1.75p 2.85p +7.55%

* Subject to approval at the Annual General Meeting.

When is the financial year end for Babcock ?

Financial year end occurs annually on March 31st.

Which stock exchange if Babcock International Group listed on ?

Babcock International Group PLC is listed on the London Stock Exchange.

What is the stock exchange symbol for Babcock ?

The TIDM (formerly EPIC) code for Babcock is BAB. You may find some websites require you to enter BAB.L to locate the stock.

Who are the Directors and Board of Babcock ?

By looking at the webpages marked ‘people’ through selecting the link on the left side of the screen for each of the Divisions and company as a whole you will find brief biographical details of the management team and Board members of the company.

How can I obtain a copy of the Annual Report and Accounts ?

You can download an electronic copy of the Report and Accounts from our archive in the investor relations section of the babcock website or alternatively you could seek to obtain a hardcopy from either a free annual reports service such as that advertised in the Financial Times newspaper or contact our registrars who will arrange to send you a hardcopy.

Which stockbrokers provide research coverage of Babcock shares ?

You can find a list of institutions currently providing research coverage of Babcock International Group on the share information page of our website.

When will Babcock publish its Interim Management Statements ?

The Transparency Directive requires companies produce a twice yearly Interim Management Statement ("IMS") to provide an explanation of material events and transactions that have taken place and their impact on the financial position and performance of the business.

The IMS required by the Disclosure and Transparency Rules (DTR 4.3.2R) must be made twice, once in both the first and second six-month period of the financial year. In each period the report is required between 10 weeks after the beginning, and six weeks before, the end of the relevant six month period.

As the start of the Babcock financial year is April 1st, the periods in which the IMS is due for publication will be;

Period 1: Between June 10th and August 19th, and;

Period 2: Between December 10th and February 18th.