UNITED STATES SECURITIES AND
                              EXCHANGE COMMISSION
                             Washington, D.C. 20549



                                  FORM 10-K/A

                               Amendment No. 1 to
                 Annual report pursuant to Section 13 or 15(d)
          of the Securities Exchange Act of 1934 for the fiscal year
                           ended December 31, 1999
                                 -----------------


                          Commission File Number 0-19150
                                                 -------

                         WISCONSIN CENTRAL TRANSPORTATION
                                    CORPORATION

              (Exact name of registrant as specified in its charter)


               Delaware                                   36-3541743

    (State or other jurisdiction of                    (I.R.S. Employer
     incorporation or organization)                 Identification Number)


   6250 North River Road, Suite 9000
          Rosemont, Illinois                                 60018

(Address of principal executive offices)                   (Zip Code)

    Registrant's telephone number,
        including area code:                            (708) 318-4600
                                                        --------------



       This Amendment No. 1 amends Registrant's Annual Report on Form
       10-K  by  adding  the  consolidated  financial  statements  of
       English Welsh & Scottish  Railway Holdings Limited pursuant to
       Rule 3-09 of Regulation S-X.

<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


                           INDEX TO FINANCIAL STATEMENTS
                                  AND SCHEDULES

                                                                         PAGE
                                                                         ----
INDEPENDENT AUDITORS' REPORT............................................. 27*

FINANCIAL STATEMENTS

         Consolidated Balance Sheets..................................... 28-29*
         Consolidated Statements of Income............................... 30*
         Consolidated Statements of Changes in Stockholders' Equity...... 31*
         Consolidated Statements of Cash Flows........................... 32*
         Notes to Consolidated Financial Statements...................... 33-46*


FINANCIAL STATEMENTS OF ENGLISH WELSH & SCOTTISH RAILWAY HOLDINGS LIMITED **

         Auditor's Report................................................. A-4
         Consolidated Profit and Loss Account............................. A-5
         Consolidated Balance Sheet....................................... A-6-7
         Reconciliation of Movements in Shareholders' Funds............... A-8
         Consolidated Cash Flow Statement................................. A-9
         Notes to Consolidated Financial Statements .................... A-10-31


Note     *: The page numbers  indicated  are those under which such  information
         was filed as part of the  Company's  Report on Form 10-K filed on March
         22, 2000. Such  information is not being amended by this Report on Form
         10-K/A.

Note**:  The amounts  shown in the  English  Welsh & Scottish  Railway  Holdings
         Limited  financial  statements are stated in pounds sterling.  At March
         31, 2000, each pound sterling equaled US $1.5913.

                                      A-1


<PAGE>



                                                                PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

     The following documents are filed as a part of this Report:

                                                                          PAGE
                                                                          ----
     (a)(1) Financial Statements

              Consolidated Balance Sheets................................ 28-29*
              Consolidated Statements of Income........................... 30*
              Consolidated Statements of Changes in Stockholders' Equity.. 31*
              Consolidated Statements of Cash Flows....................... 32*
              Notes to Consolidated Financial Statements................. 33-46*


    (2) Schedules

    Financial Statements of English Welsh & Scottish Railway Holdings Limited **

              Auditor's Report............................................ A-4
              Consolidated Profit and Loss Account........................ A-5
              Consolidated Balance Sheet.................................. A-6-7
              Reconciliation of Movements in Shareholders' Funds.......... A-8
              Consolidated Cash Flow Statement............................ A-9
              Notes to Consolidated Financial Statements ............... A-10-31


     (3) Exhibits

              The  exhibits  set forth in the Index to  Exhibits  in the
              Report on Form 10-K filed on March 22,  2000 are not being
              amended by this Report on Form 10-K/A.

     (b) Reports on Form 8-K filed during the quarter ended December 31, 1999.

              The information  provided on the Report on Form 10-K filed
              on March 22,  2000 is not being  amended by this Report on
              Form 10-K/A.

Note     *: The page numbers  indicated  are those under which such  information
         was filed as part of the  Company's  Report on Form 10-K filed on March
         22, 2000. Such  information is not being amended by this Report on Form
         10-K/A.

Note**:  The amounts  shown in the  English  Welsh & Scottish  Railway  Holdings
         Limited  financial  statements are stated in pounds sterling.  At March
         31, 2000, each pound sterling equaled US $1.5913.

                                      A-2

<PAGE>




                                  SIGNATURES

         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934,  the  registrant  has duly caused this  Amendment No. 1 to
Form  10-K  to be  signed  on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                      WISCONSIN CENTRAL TRANSPORTATION
                                      CORPORATION
                                      (Registrant)

                                      By:      /s/   Ronald G. Russ

                                                     Ronald G. Russ
                                                     Executive Vice President
                                                     Chief Financial Officer

                                                     Date:    September 29, 2000






                                      A-3


<PAGE>




                          Independent Auditors' Report

To  the  Board of Directors and Shareholders of English Welsh & Scottish Railway
    Holdings Limited:



We have audited the accompanying  consolidated balance sheets of English Welsh &
Scottish  Railway  Holdings  Limited and subsidiaries as of 31 March 2000 and 31
March   1999  and  the   related   consolidated   profit   and  loss   accounts,
reconciliations of movements in shareholders'  funds and consolidated cash flows
for each of the  years  in the two  year  period  ended  31  March  2000.  These
consolidated  financial  statements  are  the  responsibility  of the  company's
management.  Our  responsibility is to express an opinion on these  consolidated
financial statements.

We conducted our audits in accordance with generally accepted auditing standards
in the  United  Kingdom  which are  substantially  consistent  with those in the
United  States.  Those  standards  require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from
material  misstatement.  An audit includes examining,  on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the  financial  position of English Welsh &
Scottish  Railway  Holdings  Limited and subsidiaries as of 31 March 2000 and 31
March 1999 and the results of their  operations and their cash flows for each of
the  years  in the two  year  period  ended 31  March  2000 in  conformity  with
generally accepted accounting principles in the United Kingdom.

Generally accepted  accounting  principles in the United Kingdom vary in certain
significant respects from generally accepted accounting principles in the United
States.  Application of generally accepted  accounting  principles in the United
States  would have  affected  the results of  operations  for the years ended 31
March  2000 and 31 March 1999 and  shareholders'  equity at 31 March 2000 and 31
March 1999 to the extent  summarised in supplemental note 26 to the consolidated
financial statements.


KPMG
                                                           London
Chartered Accountants                                      1 September 2000
Registered Auditors















                                      A-4

<PAGE>
<TABLE>

<CAPTION>
Consolidated profit and loss account
for the year ended  31 March 2000

in millions                                                              Note            2000              1999
                                                                         ----           ------            ------
<S>                                                                       <C>           <C>               <C>
Turnover                                                                   2             520.6             523.9

Operating costs (excluding exceptional costs)                              3            (480.7)           (474.1)
Exceptional costs                                                          4             (14.3)              -
                                                                                        ------            ------
Total operating costs                                                                   (495.0)           (474.1)

Operating profit before exceptional costs                                                 39.9              49.8

                                                                                        ------            ------
Operating profit                                                                          25.6              49.8

(Loss)/profit on sale of fixed assets                                                     (0.2)              2.0
Net interest payable and similar charges                                   7             (13.0)            (13.2)

                                                                                        ------            ------
Profit on ordinary activities before taxation                              4              12.4              38.6
Tax on profit on ordinary activities                                       8              (1.9)             (5.8)

                                                                                        ------            ------
Retained profit on ordinary activities after taxation for the year        19              10.5              32.8
                                                                                        ======            ======
</TABLE>



There are no  recognised  gains or losses in the year  other than the profit for
the year.  There were no  differences  between the profit and loss account shown
above and that prepared on a historical cost basis.

All of the group's activities are continuing.

                                      A-5



<PAGE>
<TABLE>
<CAPTION>

Consolidated balance sheet
at 31 March 2000

in millions                                                          Note                     2000                  1999
                                                                     ----                     -----                 -----
<S>                                                                   <C>                    <C>                   <C>
Fixed assets
Intangible assets
Goodwill                                                              11                        4.8                   5.1
Negative goodwill                                                     11                     (105.8)               (136.2)
                                                                                              -----                 -----
                                                                                             (101.0)               (131.1)
                                                                                              -----                 -----
Tangible assets                                                        9                      418.5                 469.7
Investments                                                           10                        3.2                   1.3
                                                                                              -----                 -----
                                                                                              320.7                 339.9
                                                                                              -----                 -----
Current assets
Stocks                                                                12                       22.1                  20.3
Debtors due in more than one year                                     13                       75.5                  79.8
Debtors due within one year                                           13                      111.9                 127.0
                                                                                              187.4                 206.8
Cash at bank and in hand                                                                        9.5                  18.4
                                                                                              -----                 -----
                                                                                              219.0                 245.5

Creditors: amounts falling due within one year                        14                     (129.1)               (146.9)

                                                                                              -----                 -----
Net current assets                                                                             89.9                  98.6
                                                                                              -----                 -----

Total assets less current liabilities                                                         410.6                 438.5

Creditors: amounts falling due after more than one year               15                     (151.9)               (185.6)
Provisions for liabilities and charges                                16                      (46.7)                (57.1)
Deferred income                                                       17                      (12.1)                (10.9)
                                                                                              -----                 -----
Net assets                                                                                    199.9                 184.9
                                                                                              =====                 =====

Capital and reserves
Called up share capital                                               18                      104.6                 100.2
Share premium account                                                 19                        2.0                   1.9
Profit and loss account                                               19                       93.3                  82.8

                                                                                              -----                 -----
Equity shareholders' funds                                                                    199.9                 184.9
                                                                                              =====                 =====

</TABLE>

These  financial  statements  were approved by the board of directors on 24 July
2000 and were signed on its behalf by:

P.R. Mengel

Chief Executive

                                      A-6



<PAGE>
<TABLE>
<CAPTION>

Company balance sheet at 31 March 2000

in millions                                                        Note               2000                 1999
                                                                   ----              -----                -----
<S>                                                                 <C>             <C>                  <C>
Fixed assets
Investments                                                         10               147.6                131.0

Current assets

Debtors                                                             13               235.9                195.7
Cash at bank and in hand                                                              47.6                   -
                                                                                     -----                -----
                                                                                     283.5                195.7

Creditors : amounts falling due within one year                     14               (79.5)               (85.3)
                                                                                     -----                -----

Net current assets                                                                   204.0                110.4

Total assets less current liabilities                                                351.6                241.4

Creditors: amounts falling due after more than one year             15              (151.7)               (56.5)
                                                                                     -----                -----

Net assets                                                                           199.9                184.9
                                                                                     =====                =====
Capital and reserves
Called up share capital                                             18               104.6                100.2
Share premium account                                               19                 2.0                  1.9
Revaluation reserve                                                 19               102.3                 87.6
Profit and loss account                                             19                (9.0)                (4.8)
                                                                                     -----                -----
Equity shareholders' funds                                                           199.9                184.9
                                                                                     =====                =====

</TABLE>

These  financial  statements  were approved by the board of directors on 24 July
2000 and were signed on its behalf by:

P.R. Mengel

Chief Executive

                                      A-7



<PAGE>

<TABLE>
<CAPTION>

Reconciliation of movements in shareholders' funds
for the year ended 31 March 2000

in millions                                                              2000                             1999
                                                                 ----------------------            ---------------------
                                                                 Group          Company            Group         Company
                                                                 -----          -------            -----         -------
<S>                                                              <C>             <C>               <C>            <C>
Profit/(loss) for the year                                        10.5            (4.2)             32.8           (2.2)
New share capital subscribed                                       4.4             4.4               0.8            0.8
Share premium arising on new share capital                         0.1             0.1               0.4            0.4
Revaluation of investment in subsidiaries                          -              14.7               -             35.0

                                                                 -----           -----             -----          -----
Net addition to shareholders' funds                               15.0            15.0              34.0           34.0
Opening shareholders' funds                                      184.9           184.9             150.9          150.9
                                                                 -----           -----             -----          -----
Closing shareholders' funds                                      199.9           199.9             184.9          184.9
                                                                 =====           =====             =====          =====
</TABLE>






                                     A-8



<PAGE>
<TABLE>
<CAPTION>

Consolidated cash flow statement
for the year ended 31 March 2000

in millions                                                    Note               2000               1999
                                                               -----              -----              -----
<S>                                                              <C>             <C>                 <C>
Net cash inflow from operating activities                        22                33.0               50.2

Return on investments and servicing of finance                   23               (10.5)             (18.3)

Taxation received / (paid )                                                         0.9               (0.9)

Capital expenditure and financial investment                     23                (2.0)             (44.8)

Acquisitions and disposals                                       23                  -                (3.2)
                                                                                  -----              -----

Net cash inflow / (outflow) before financing                                       21.4              (17.0)

Financing

  Issue of ordinary share capital                                                   4.5                1.2
  Long term loans raised                                                           95.8               40.0
  Costs of raising long term loans                                                 (1.4)                -
  Repayment of long term loans                                                   (127.3)             (25.0)
  Movement in cost of investment in own shares                                     (1.6)              (0.9)
  Repayment of finance leases                                                      (0.3)              (0.5)
                                                                                  -----              -----

Net cash (outflow) / inflow from financing                                        (30.3)              14.8
                                                                                  -----              -----
Decrease in cash and cash equivalents                            24                (8.9)              (2.2)
                                                                                  =====              =====


</TABLE>






                                      A-9

<PAGE>


Notes

(forming part the financial statements)


1        Accounting Policies

         The following  accounting  policies have been applied  consistently  in
         dealing  with items  which are  considered  material in relation to the
         group's financial statements.

         Basis of Preparation

         The  financial   statements  have  been  prepared  in  accordance  with
         applicable   accounting   standards  and  under  the  historical   cost
         convention  modified  to include  the  revaluation  of  investments  in
         subsidiaries within the financial statements of the company.

         Basis of consolidation

         The group accounts consolidate the accounts of English Welsh & Scottish
         Railway  Holdings  Limited  and all  its  subsidiary  undertakings  and
         participating  interests.  These accounts are made up to 31 March 2000.
         The   consolidated   accounts  are  based  on  accounts  of  subsidiary
         undertakings,  all of which are  coterminous  with  those of the parent
         company, and on the accounts of the parent company.

         The  acquisition  method of  accounting  has been  adopted.  Under this
         method,  the  results  of  subsidiary  undertakings  and  participating
         interests  acquired  in the period  are  included  in the  consolidated
         profit and loss account from the date of acquisition.

         In the company's accounts,  investments in subsidiary  undertakings are
         revalued to reflect the underlying  book value of the net assets of the
         subsidiaries.  The  result  for the year  dealt  with in the  financial
         statements  of English  Welsh & Scottish  Railway  Holdings  Limited is
         disclosed in Note 19 to these accounts. The company has taken advantage
         of section  230(4) of the  Companies Act 1985 and has not presented its
         own profit and loss account.

         Goodwill

         Goodwill  whether  negative or positive is disclosed  as an  intangible
         asset.  Negative goodwill up to the fair value of non - monetary assets
         acquired  is  amortised  to the profit  and loss  account in periods in
         which these assets are  recovered.  Negative  goodwill in excess of the
         fair value of the assets acquired is amortised over the period in which
         the  losses  to which it  relates  are  expected  to  accrue.  Positive
         goodwill is amortised over 20 years.

         Fixed assets and depreciation

         Tangible  fixed  assets are stated at  original  cost less  accumulated
         depreciation.  In the case of assets constructed by the Group,  finance
         costs as  defined  by FRS 15 are  included  in costs.  Depreciation  is
         provided  by the  company  to  write  off the cost  less the  estimated
         residual value of tangible fixed assets by equal instalments over their
         estimated  useful economic lives from the time assets come into service
         as follows:

o        Freehold buildings                      40 years
o        Leasehold land and buildings            life of lease
o        Plant, machinery and equipment          3 to 10 years
o        Rolling stock                           20 to 50 years
o        Infrastructure                          10 to 30 years


         No depreciation is provided on freehold land.

                                     A-10



<PAGE>


Notes continued

1        Accounting Policies continued

         Leases

         Where the group enters into a lease which entails taking  substantially
         all the risks  and  rewards  of  ownership  of an  asset,  the lease is
         treated as a `finance  lease'.  The asset is  recorded  in the  balance
         sheet as a tangible fixed asset and is  depreciated  over its estimated
         useful  life or the term of the lease,  whichever  is  shorter.  Future
         instalments  under such leases,  net of finance  charges,  are included
         within creditors.  Rentals payable are apportioned  between the finance
         element,  which is  charged to the  profit  and loss  account,  and the
         capital  element which reduces the  outstanding  obligation  for future
         instalments.

         All other leases are accounted for as `operating leases' and the rental
         charges are charged to the profit and loss  account on a straight  line
         basis over the life of the lease.

         Government grants

         Capital  based  government  grants are  included  within  accruals  and
         deferred  income in the balance  sheet and  credited to trading  profit
         over the estimated  useful  economic  lives of the assets to which they
         relate.  Revenue based government grants are credited to trading profit
         in the  period  in which  the  expenditure  to  which  they  relate  is
         incurred.

         Stocks

         Stocks are stated at the lower of cost and net realisable value.

         Pensions and other post-retirement benefits

         The expected cost of providing pensions, as calculated  periodically by
         professionally  qualified actuaries,  is charged to the profit and loss
         account so as to spread the cost over the service lives of employees in
         the scheme in such a way that the pension cost is a substantially level
         percentage  of  current  and  expected  future   pensionable   payroll.
         Differences  between the amount  charged to the profit and loss account
         and payments  made to schemes are treated as assets or  liabilities  in
         the  Balance  Sheet.  Further  details  are  given  in  Note  21 to the
         accounts.

         Taxation

         The charge for taxation is based on the profit for the period and takes
         into account taxation  deferred because of timing  differences  between
         the  treatment of certain items for taxation and  accounting  purposes.
         Provision  is made  for  deferred  tax  only to the  extent  that it is
         probable  that  an  actual  liability  will   crystallise   within  the
         foreseeable   future.   Partial  provision  is  also  made  for  timing
         differences arising on the pension fund prepayment.

         Foreign Exchange

         Transactions  in foreign  currencies are recorded at the rate ruling at
         the date of the  transaction or at the contract rate if the transaction
         is  covered  by  a  forward  exchange  contract.  Monetary  assets  and
         liabilities  denominated  in foreign  currencies  are translated at the
         rate of exchange  ruling at balance sheet date or, if  appropriate,  at
         the forward  exchange  contract rate. All  differences are taken to the
         profit and loss account except to the extent that they are  recoverable
         from a third party in which case they are recorded as a debtor.

         Hedging

         Gains and losses on hedge  contracts  are  recognised in the profit and
         loss account as they arise.

                                     A-11


<PAGE>


Notes continued

2        Turnover

         Turnover  is  stated  net of value  added  tax and  represents  amounts
         invoiced  to third  parties  and  estimates  in respect of amounts  not
         invoiced.

         Turnover and operating  profit is  attributable  to one  activity,  the
         haulage  of  freight  and  mail  by rail  and  other  related  services
         throughout England, Wales and Scotland.

3        Operating expenditure
<TABLE>
<CAPTION>

         in millions                                                                             2000                1999
                                                                                                -----               -----
<S>                                                                                             <C>                 <C>
         Raw materials and consumables                                                           54.9                58.8
         Other external charges                                                                 227.0               211.0
         Staff costs (Note 6)                                                                   187.1               195.1
         Depreciation and other amounts written off tangible and intangible fixed assets         11.7                 9.2
                                                                                                480.7               474.1
                                                                                                =====               =====
</TABLE>

4        Profit on ordinary activities before taxation
<TABLE>
<CAPTION>

         in millions                                                                             2000                1999
                                                                                                 ----                ----
         <S>                                                                                     <C>                 <C>
         Profit on ordinary  activities before taxation is stated after charging
         Auditors' remuneration:
         Audit - group                                                                            0.2                 0.2
         Other services - group                                                                   0.1                 0.1
         Depreciation and other amounts written off tangible fixed assets:
         Owned                                                                                   41.7                17.5
         Leased                                                                                   1.0                 0.9
         Amortisation of positive goodwill                                                                            0.3
         Rentals payable under operating leases     - hire of plant and machinery                                     8.6
                                                    - other operating leases                                          1.2
         Year 2000 costs                                                                          2.5                 1.8
         Exchange losses                                                                          0.6                 0.2

         after crediting
         Government grants credited to profit and loss account                                    3.2                 0.4
         Rents receivable from property                                                           9.4                 9.4
         Amortisation of negative goodwill                                                       30.4                 9.5

</TABLE>

         Charges  amounting  to 14.3 million have been classified as exceptional
         items  in the  profit  and  loss  account.  These  charges comprise the
         termination  of an  IT  project (12.5 million) and  the  write  down of
         wagons (23.5  million), the latter  being  offset by 21.7 million write
         down of negative goodwill.

         The operating loss dealt with in the accounts of the parent company was
         0.3 million (1999:0.3 million).


                                     A-12


<PAGE>


Notes continued

5        Remuneration of directors
<TABLE>
<CAPTION>

                                                                                            2000             1999
                                                                                         ------------     ------------
         <S>                                                                                <C>              <C>
         Aggregate emoluments of directors                                                  246,974          180,277
         Number of directors for  whom retirement benefits are accruing under a money             -                1
         purchase scheme
         Number of directors for  whom retirement benefits are accruing under a                   -                1
         defined benefits scheme
         Number of directors eligible for shares under a long term incentive scheme               1                1
</TABLE>

         Highest Paid Director

         The highest paid director received emoluments of 135,216 (1999:164,277)
         in the year.

         Director's  interests in the ordinary  share capital of the company and
         options granted during the year are disclosed below.

         45,652 (1999:  32,000) was  paid  to  Wisconsin  Central Transportation
         Corporation,  a  shareholder  in the company, for the provision of the
         services  of  E A Burkhardt,  T F Power, T Rissman and R H Wheeler, who
         were  also directors of  Wisconsin  Central Transportation Corporation
         during  part  or all of the year. A further 1,446,399 (1999: 1,315,516)
         was paid  in  relation  to the  provision  of  consultancy and advisory
         services under a management contract amongst other things.

         32,000 (1999: 119,200) was  paid or is payable to Berkshire Partners, a
         shareholder  in  the  company,  for  the  services  of  C Ferenbach and
         R K Lubin.

         16,000 (1999: 22,267)  was  paid  or  is  payable  to  Fay Richwhite, a
         shareholder in the company, for the services of D M  Richwhite.
         Nil (1999: 26,600) was  paid  or is payable to McLachlan Rissman & Doll
         for the services of T W Rissman, a partner in the above practice.

         7,385 (1999: 8,615) was  paid  or is payable to BIL Consultants for the
         services of R O H Morley.

         I K  Braybrook  received 415,492  in  compensation  for loss of office,
         383,750 of which was in cash.

         Transactions involving directors

         McLachlan  Rissman & Doll,  a  partnership  in which T W Rissman has an
         interest,  was  paid  28,706 (1999: 72,436) during  the  period for the
         provision of legal and other professional services.

         The shares and options held by directors were as follows.
<TABLE>
<CAPTION>

                                             Ordinary Shares of 1 pound each       Share Options
                                                    held in the company
                                                  1 April       31 March        1 April       31 March
                                                    1999          2000            1999          2000
                                                    ----          ----            ----          ----
<S>                                               <C>           <C>             <C>            <C>
         T.F. Power                               200,000       200,000         100,000        100,000
         C. Ferenbach                             200,000       200,000         100,000        100,000
         Lord B. Griffiths of Fforestfach         200,000       200,000         100,000        100,000
         R.K. Lubin                               200,000       200,000         100,000        100,000
         D.M. Richwhite                           200,000            -          100,000         78,036
         T.W. Rissman                             200,000       200,000         100,000        100,000
         I.K. Braybrook                           150,000            -          319,538           -
         E.A. Burkhardt                           200,000            -          100,000           -
</TABLE>

                                     A-13
<PAGE>
  Notes continued

  5      Remuneration of directors continued

         Except as detailed  below,  the options are  exercisable at (pound)1.00
         each no sooner than 10  September  1999 and no later than 10  September
         2003 and no options  were  granted  to or  exercised  by the  directors
         during the year.

         The  Board  deemed  the  market  value  of  the  shares  to be 3 pounds
         throughout the year.

         E.A Burkhardt  disposed  of  200,000  shares  and  100,000  options  to
         Wisconsin Central International Inc. on 17 August 1999.

         I.K. Braybrook exercised all options available to him and the resultant
         shares were purchased by the EWS Employee Share Trust.

         D.M. Richwhite  disposed  of 200,000 shares to Fay Richwhite UK Limited
         on 30 June 1999.

         D.M. Richwhite  transferred  3,240 options  to Goldman Sachs and 18,724
         options to Wisconsin Central International Inc. on 30 June 1999.

         D.M. Richwhite,  in  addition  to  the  shares and options above, has a
         disclosable interest in 13,390,203 of the issued ordinary share capital
         of the company.

         A.T. Gibbs  has  a disclosable  interest  in  1,262,000  of  the issued
         ordinary share capital of the company.


6        Staff numbers and costs

                                                               2000       1999
                                                                No.        No.
                                                              -----      -----
         Average number of people employed:
         Management and operation of rail freight services    6,221      6,866
                                                              =====      =====



         At 31 March 1999 6,564  people  were  employed by the group which total
         had reduced to 5,917 by 31 March 2000.

         The aggregate payroll costs of these persons were as follows:

         in millions                                           2000       1999
                                                              -----      -----
         Wages & salaries                                     156.7      163.3
         Social security  costs                                12.8       13.1
         Other pension costs (see note 21)                      4.4        2.4
         Other staff costs                                     13.2       16.3
                                                              -----      -----
                                                              187.1      195.1
                                                              =====      =====







                                     A-14



<PAGE>


Notes continued

7        Net interest payable and similar charges
<TABLE>
<CAPTION>

         in millions                                                                          2000          1999
                                                                                             -----         -----

         <S>                                                                                 <C>           <C>
         Other interest receivable and similar income                                          0.4           0.6

         Other interest payable and similar charges:

         On bank loans and overdrafts repayable within five years                            (13.2)        (18.4)
         Finance charges payable in respect of finance leases and hire purchase contracts     (0.2)          -
                                                                                             -----         -----
                                                                                             (13.4)        (18.4)
         Interest capitalised                                                                  -             4.6
                                                                                             -----         -----
         Total other interest payable and similar charges                                    (13.4)        (13.8)
                                                                                             -----         -----

         Net interest payable and similar charges                                            (13.0)        (13.2)
                                                                                             =====         =====
</TABLE>


8        Taxation
<TABLE>
<CAPTION>
                                                                                              2000          1999
                                                                                              ----          ----
       <S>                                                                                    <C>           <C>
       UK corporation tax at 30% (1999: 30%) on the profit on ordinary activities for the
       year to 31 March 2000                                                                   -              -

       Deferred Taxation                                                                      (1.9)         (5.8)
                                                                                              ----          ----
                                                                                              (1.9)         (5.8)
                                                                                              ====          ====

</TABLE>

         The  group  has a low  effective  tax  rate  due  to  the  current  and
         prospective availability of substantial capital allowances.

         The exceptional items reduced the tax charge by 1.9 million.







                                     A-15


<PAGE>


Notes continued

9        Tangible fixed assets

<TABLE>
<CAPTION>
                                                                     Plant,
      in millions                                                   Machinery                           Assets in
                                   Land &        Rolling               &                Infra-          course of
                                 buildings        stock            equipment          structure       construction         Total
                               ------------    -------------    ---------------     -------------    ---------------    ------------
      Group
      Cost

<S>                                  <C>             <C>                <C>                  <C>              <C>             <C>
      At 1 April 1999                65.8            325.4              30.6                 9.5              97.5            528.8
      Additions                       1.5              5.3               7.7                 2.3              50.5             67.3
      Disposals                      (1.6)            (3.8)             (0.3)                -               (71.2)           (76.9)
      Transfers                       1.9              3.3               7.1                 4.7             (17.0)             -
                                    -----            -----             -----               -----             -----            -----
      At 31 March 2000               67.6            330.2              45.1                16.5              59.8            519.2
                                    =====            =====             =====               =====             =====            =====

      Depreciation and
      diminution in value

      At 1 April 1999                (3.4)           (39.1)            (15.5)               (1.1)              -              (59.1)
      Charge for the year            (1.4)           (13.6)             (4.3)               (0.8)              -              (20.1)
      Accelerated                     -              (22.6)              -                   -                 -              (22.6)
      depreciation
      On disposals                    0.1              0.7               0.3                 -                 -                1.1
                                    -----            -----             -----               -----             -----            -----
      At 31 March 2000               (4.7)           (74.6)            (19.5)               (1.9)              -             (100.7)
                                    =====            =====             =====               =====             =====            =====

      Net book value
      At 31 March 2000               62.9            255.6              25.6                14.6              59.8            418.5
                                    =====            =====             =====               =====             =====            =====

      At 31 March 1999               62.4            286.3              15.1                 8.4              97.5            469.7
                                    =====            =====             =====               =====             =====            =====
</TABLE>

         The net book value of land and buildings at 31 March 2000 comprises:


       in millions                       Group    Company      Group     Company
                                          2000      2000        1999       1999
                                         -----    -------      -----     -------


       Freehold land and buildings        36.8        -         34.8         -
       Long leasehold                     24.1        -         25.5         -
       Short leasehold                     2.0        -          2.1         -
                                          ----      ----        ----       ----
                                          62.9        -         62.4         -
                                          ====      ====        ====       ====

       Included  in freehold  land  and  buildings is land valued at 4.8 million
       which is not depreciated.

                                     A-16



<PAGE>


Notes continued

9        Tangible fixed assets continued

         Assets held under finance leases

       in millions                                         Plant,
                                                         machinery
                                            Rolling         and
                                             stock       equipment        Total
                                            -------        -----          -----
       Cost:
       At 1 April 1999 and 31 March 2000      22.6           1.0           23.6
                                              ----          ----           ----

       Depreciation:
       At 1 April 1999                        (8.1)         (0.9)          (9.0)
       Charge for the year                    (0.9)         (0.1)          (1.0)

                                              ----          ----           ----
       At 31 March 2000                       (9.0)         (1.0)         (10.0)
                                              ----          ----           ----

       Net Book Value
       At 31 March 2000                       13.6            -            13.6
                                              ====          ====           ====

       At 31 March 1999                       14.5           0.1           14.6
                                              ====          ====           ====


10       Fixed asset investments

       in millions                   Own      Participating    Trade
                                    Shares      interests    Investment    Total
                                    ------    -------------  ----------    -----
       Group
       Cost
       At 1 April 1999                1.7           0.6         0.6         2.9
       Additions                      1.9            -           -          1.9
       Disposals                     (0.3)           -           -         (0.3)
                                     ----          ----        ----        ----
       At 31 March 2000               3.3           0.6         0.6         4.5
                                     ----          ----        ----        ----
       Provisions

       At 1 April 1999               (1.6)           -           -         (1.6)
       Utilised during the year       0.3            -           -          0.3
                                     ----          ----        ----        -----
                                     (1.3)           -           -         (1.3)
                                     ----          ----        ----        -----
       At 31 March 2000
       Net Book Value
       31 March 2000                  2.0           0.6         0.6         3.2
                                     ====          ====        ====        ====

       31 March 1999                  0.1           0.6         0.6         1.3
                                     ====          ====        ====        ====



                                     A-17


<PAGE>


Notes continued

10       Fixed asset investments - company continued

         EW & S Employee  Share  Trust,  was  created on 14 November  1996.  The
         trustee, EWS Trustees Ltd, at its absolute discretion  determines which
         directors and employees are to participate in a bonus share plan in any
         fiscal year. All costs incurred in the  administration of the trust are
         charged to the profit and loss account as incurred.

         At 31 March 2000,  the trust held 1,608,039 (1999: 1,188,005) shares of
         which 863,754 (1999: 1,070,520) were  under  option  to  employees  and
         directors.  The historic cost of these shares is 3.3 million.

       in millions                     Own       Value of shares in
                                      shares        subsidiaries          Total
                                      ------     ------------------       -----
       Company
       Cost/Valuation
       At 1 April 1999                  1.7             130.9             132.6
       Additions at cost                1.9                -                1.9
       Disposals                       (0.3)               -               (0.3)
       Revaluation                       -               14.7              14.7
                                       ----             -----             -----
       At 31 March 2000                 3.3             145.6             148.9
                                       ----             -----             -----
       Provisions
       At 1 April 1999                 (1.6)               -               (1.6)
       Utilised during the year         0.3                -                0.3
                                       ----             -----             -----
                                       (1.3)               -               (1.3)
                                       ----             -----             -----

       Net Book Value 31 March 2000     2.0             145.6             147.6
                                       ====             =====             =====

       Net Book Value 31 March 1999     0.1             130.9             131.0
                                       ====             =====             =====

         Investments  in group  companies  have been  revalued  to  reflect  the
         underlying  book  value of the net  assets  of the  subsidiaries.  This
         revaluation is eliminated on consolidation.

         The  companies  in which the  company's  interest is 10% or more are as
         follows:

<TABLE>
<CAPTION>
                                                                                                             Class and
                                                  Country of                                               percentage of
                                               registration or            Principal activity                shares held
                                                incorporation                                             Group & company

                                               ---------------        ---------------------------         ---------------
       Subsidiary undertakings
       <S>                                     <C>                    <C>                                 <C>
       Boreal & Austral Railfreight Limited    England & Wales             Holding company                100% 1 Ordinary
       New Locomotive Finance Limited          England & Wales         Acquisition and leasing            100% 1 Ordinary
                                                                           of rolling stock
       RES (December) Limited                  England & Wales             Holding company                100% 1 Ordinary
       Rail Express Systems Limited            England & Wales        Transportation and allied           100% 1 Ordinary
                                                                               services

       Loadhaul Limited                        England & Wales                 Dormant                    100% 1 Ordinary
       English Welsh & Scottish Railway        England & Wales            Haulage of freight              100% 1 Ordinary
       Limited
       Mainline Freight Limited                England & Wales                 Dormant                    100% 1 Ordinary
       NPJV Limited                            England & Wales                 Dormant                    100% 1 Ordinary
</TABLE>

                                     A-18



<PAGE>


Notes continued

10       Fixed asset investments - company continued
<TABLE>
<CAPTION>
                                                                                                             Class and
                                                  Country of                                               percentage of
                                               registration or            Principal activity                shares held
                                                incorporation                                             Group & company
                                               ---------------        ---------------------------         ---------------

       <S>                                     <C>                    <C>                                 <C>
       LGJV Limited                            England & Wales                 Dormant                    100% 1 Ordinary
       EWS Finance Limited                     England & Wales         Acquisition and leasing            100% 1 Ordinary
                                                                           of rolling stock
       East & West Limited                     England & Wales             Holding company                100% 1 Ordinary
       English Welsh & Scottish Railway        England & Wales            Haulage of freight              100% 1 Ordinary
       International Limited
       EW & S Trustees Limited                 England & Wales        Trustee of employee share           100% 1 Ordinary
                                                                                trust

       Locomotive 6667 Limited                 England & Wales                 Dormant                    100% 1 Ordinary

       Participating interests

       Allied Continental Intermodal

       Services Limited                        England & Wales               Railfreight                   25% 1 Ordinary
       Autotrax Limited                        England & Wales           Terminal management               24% 1 Ordinary
       Intermodal Wagon Systems Limited
                                               England & Wales               Railfreight                   25% 1 Ordinary
       Combined Transport Limited              England & Wales               Railfreight                   10% 1 Ordinary
       Unilog NV                                   Belgium                   Railfreight                   45% 1 Ordinary

</TABLE>

         The investments in participating interests are unlisted. In the opinion
         of the directors,  the aggregate value of these investments is not less
         than the amounts at which they are stated in the balance sheet.

11       Goodwill

         Intangible  assets  consist of goodwill  arising on the  acquisition of
         businesses  acquired by the group. No goodwill is recorded in the books
         of the company.
<TABLE>
<CAPTION>

         in millions                                                     Negative         Positive          Total
                                                                         Goodwill         Goodwill         Goodwill
                                                                        ------------    ------------     ------------
         <S>                                                              <C>               <C>             <C>
         Gross Value
         At 1 April 1999 and 31 March 2000                                (150.2)            6.0            (144.2)
                                                                          ------           -----            ------

         Accumulated amortisation

         At 1 April 1999                                                    14.0            (0.9)             13.1
         Amortisation of goodwill during the year                            8.7            (0.3)              8.4
         Accelerated release of negative goodwill                           21.7             -                21.7
                                                                          ------           -----            ------
         At 31 March 2000                                                   44.4            (1.2)             43.2
                                                                          ------           -----            ------
         Net Book Value

         At 31 March 2000                                                 (105.8)            4.8            (101.0)
                                                                          ======           =====            ======
         At 31 March 1999                                                 (136.2)            5.1            (131.1)
                                                                          ======           =====            ======
</TABLE>


         (pound)38.6  million of the negative  goodwill is being  amortised over
         the period from the 22  November  1997 to 30 April 2005 for the reasons
         detailed in note 20(vii).  The remaining negative goodwill is amortised
         over  the life of the  assets  to which  it  relates.  The  accelerated
         release of negative  goodwill  arises on the write down of the carrying
         value of certain wagons.

                                     A-19
<PAGE>

Notes continued

12       Stocks

         Stocks held by the group comprise spare parts held for the  maintenance
         of the group's assets. No stocks were held by the company.

13       Debtors
<TABLE>
<CAPTION>

       in millions                                                       Group         Company           Group         Company
                                                                         2000            2000            1999            1999
                                                                         -----         -------           -----         -------
       Amounts falling due within one year

       <S>                                                               <C>             <C>              <C>            <C>
       Trade debtors                                                      71.5             -              62.6             -
       Amounts owed by group undertakings                                  -             234.4             -             194.4
       Amounts owed by participating interests                             7.2             -              10.6             -
       Other debtors                                                      17.8             1.5            37.1             1.3
       Prepayments and accrued income                                     15.4             -              16.7             -
                                                                         -----           -----           -----           -----
                                                                         111.9           235.9           127.0           195.7
                                                                         =====           =====           =====           =====
       Amounts falling due after more than one year
       Pension fund prepayment                                            75.5             -              79.8             -
                                                                         =====           =====           =====           =====
</TABLE>

14       Creditors: amounts falling due within one year

<TABLE>
<CAPTION>
       in millions                                                       Group          Company         Group           Company
                                                                         2000            2000            1999             1999
                                                                         -----          -------         -----           -------

       <S>                                                                <C>             <C>             <C>              <C>
       Bank loans and overdrafts                                          25.0             -              23.3             6.9
       Trade creditors                                                    43.0             -              52.4             -
       Amounts owed to group undertakings                                  -              77.8             -              77.7
       Obligations under finance leases and hire purchase contracts        0.6             -               0.3             -
       Other creditors including taxation and social security:
           Corporation tax                                                 5.6             -               4.7             -
           Other taxes and social security costs                          11.4             -               8.7             -
           Other creditors                                                 6.7             -               2.3             0.1
       Accruals                                                           36.8             1.7            55.2             0.6
                                                                         -----           -----           -----           -----
                                                                         129.1            79.5           146.9            85.3
                                                                         =====           =====           =====           =====
</TABLE>

15       Creditors: amounts falling due after more than one year
<TABLE>
<CAPTION>

       in millions                                                       Group          Company         Group          Company
                                                                         2000            2000            1999            1999
                                                                         -----          -------         -----          -------

       <S>                                                               <C>             <C>            <C>              <C>
       Bank loans (net of unamortised financing costs)                   150.8           151.7          183.9            56.5
       Obligations under finance leases and hire purchase contracts        1.1             -              1.7             -
                                                                        ------           -----          -----           -----
                                                                         151.9           151.7          185.6            56.5
                                                                        ======           =====          =====           =====

</TABLE>

                                     A-20

<PAGE>

         Notes continued

         Interest Rates and Security on Loans

         The Group  renegotiated  the terms of its bank loans in November  1999.
         The bank loans now include:

         A senior  revolving credit  facility  of 150M.  Borrowers  include  EWS
         Holdings, EWS  Railway  Limited,  Loadhaul  Limited,  Mainline  Freight
         Limited,  Rail Express System  Limited;  The loan is secured by a first
         fixed and floating  charge over the tangible and  intangible  assets of
         the Group except  certain  assets of EWS Railway which are subject to a
         prior charge in favour of the Post Office under the terms of a contract
         for the  carriage  of mail,  and the shares of New  Locomotive  Finance
         Limited,  English Welsh & Scottish Railway  International  Limited, and
         East & West  Limited  which are charged on a  subordinated  basis.  The
         facility  has  cross-guarantees  from the all  material  members of the
         group. The loan is repayable in full on 30 September 2003, and attracts
         interest  of Libor  plus a margin of  between  75 basis  points and 150
         basis  points.   At  31 March 2000  there  was  93.8 outstanding net of
         unamortised financing charges. (1999: 73.6M)

         A  term  loan  of  60M;  The  borrower  is  English  Welsh  &  Scottish
         Railway  Holdings  Limited.  The loan is secured and  guaranteed in the
         same manner as the senior revolving credit facility, but ranks after it
         in order of preference  and is repayable in full in February  2004. The
         loan attracts interest of Libor plus a margin of 65 basis points. At 31
         March 2000  there  was  57.2m outstanding net of unamortised  financing
         costs.  (1999 56.5M)

         A revolving  credit  facility of 25M; The sole borrower is EWS  Finance
         Limited.  The  loan is  secured  by a fixed  charge over the borrower's
         tangible  assets  financed  or refinanced through the facility, a first
         priority  charge  over  the  shares  of  EWS  Finance,  and  a  general
         floating charge. EWS Holdings Limited provides a subordinated guarantee
         of lease payments due from EWS Railway Ltd to EWS Finance Limited.  The
         loan is repayable in full on 30 September  2003, and attracts  interest
         of Libor plus a margin of between 75 basis points and 150 basis points.
         At 31 March 2000 there was Nil outstanding. (1999: 33M)

         A term loan made to New Locomotive Finance Limited. The loan is secured
         a first  priority  charge  over  the  shares  of NLFL , and  fixed  and
         floating charges over the tangible and intangible  assets of NLFL . The
         timing of the  repayment  of the loan depends on the dates on which the
         final class 66 and class 67 locomotives  are delivered.  It is expected
         that the loan  will be  extinguished  during  the year  ending 31 March
         2001.  The loan  attracts  interest of Libor plus a margin of 125 basis
         points.  At 31 March  2000 there was 25m outstanding net of unamortised
         financing costs. (1999 44.1M)

         Bank loans payable by instalments:
<TABLE>
<CAPTION>

       in millions                                                              Group                     Company
                                                                        2000          1999          2000         1999
                                                                        ----          ----          ----         ----
       Amounts falling due:
           <S>                                                         <C>            <C>          <C>           <C>
           In more than 1 year but not more than 2 years                  -           36.7            -            -
           In more than 2 years but not more than 5 years              150.8         145.5         151.7         56.5
           In more than 5 years                                           -            1.7            -            -
                                                                       -----         -----         -----        -----
                                                                       150.8         183.9         151.7         56.5
                                                                       =====         =====         =====        =====
</TABLE>





                                     A-21



<PAGE>


Notes continued

15       Creditors: amounts falling due after more than one year continued

<TABLE>
<CAPTION>

         The interest rate and currency profiles of bank loans are as follows:

                                                      Total            Weighted            Weighted           Fair value
                                                    borrowings          average          average time             of
                                                     millions        interest rate      for which rate        borrowings
                                                                                           is fixed            millions
                                                 ---------------    --------------     ----------------    --------------
       Group

       <S>                                            <C>                <C>               <C>                  <C>
       Sterling
       Variable rate                                  143.2               -                    -                143.2
       Fixed rate                                      25.0              7.9%               5 Years              25.2

       US Dollars
       Variable rate                                     -                -                    -                   -
       Fixed rate                                      12.8              7.3%              27 Months             12.8
                                                      -----                                                     -----
                                                      181.0                                                     181.2
                                                                                                                =====
       Less unamortised finance costs                  (5.2)
                                                      -----
                                                      175.8
                                                      =====

       Company

       Variable rate                                  131.0                -                   -                131.0
       Fixed rate                                      25.0              7.9%               5 Years              25.2
                                                      -----                                                     -----
                                                      156.0                                                     156.2
                                                                                                                =====
       Less unamortised finance costs                  (4.3)
                                                      -----
                                                      151.7
                                                      =====
</TABLE>


         The fair value of borrowings  has been  determined by marking  interest
         rate swaps to market at 31 March 2000.

         The maturity of  obligations  under  finance  leases and hire  purchase
         contracts is as follows:

       in millions                     Group     Company      Group      Company
                                       2000        2000       1999         1999
                                       ----        ----       ----         ----

       Within one year                  0.6          -         0.5           -
       In the second to fifth years     1.1          -         1.3           -
       Over five years                   -           -         0.2           -
                                        ---         ---        ---          ---
                                        1.7          -         2.0           -
                                        ===         ===        ===          ===




                                     A-22



<PAGE>


Notes continued

16       Provisions for liabilities and charges

<TABLE>
<CAPTION>
     in millions                 Environmental     Deferred Tax        Redundancy        Claims           Other             Total
                                   Provision        Provision           Provision       Provision       Provisions        Provisions
                                 -------------     ------------        ----------       ---------       ----------        ----------
     Group
     <S>                             <C>              <C>               <C>                <C>              <C>             <C>
     At 1 April 1999                  6.2             14.5               14.9              11.2             10.3             57.1
     Utilised during year            (0.2)              -               (12.3)             (4.6)            (0.5)           (17.6)
     Unutilised amounts
     released in the year              -                -                  -               (4.1)            (1.9)            (6.0)
     Provisions created in
     the year                          -               1.9                 -                5.6              5.7             13.2
                                     ----             ----               ----              ----             ----             ----
     At 31 March 2000                 6.0             16.4                2.6               8.1             13.6             46.7
                                     ====             ====               ====              ====             ====             ====
</TABLE>

         The environmental  provision represents the anticipated future costs of
         rectifying  potential  pollution  at sites  occupied by the group.  The
         redundancy   provision   reflects  the  anticipated   future  costs  of
         implementing  plans to  restructure  the group.  The  claims  provision
         represents  the  anticipated  costs of  claims  made by  third  parties
         against group companies to the extent they are not recoverable from the
         group's insurers.

         The amounts  provided  and not  provided  for deferred tax are analysed
         below:
<TABLE>
<CAPTION>

         in millions                                                       2000                               1999
                                                                 Provided         Unprovided        Provided         Unprovided
                                                                 --------         ----------        --------         ----------
         <S>                                                       <C>               <C>               <C>              <C>
         Difference between accumulated depreciation and
         amortisation and capital allowances                       (3.5)             43.3              (2.8)            56.4
         Timing difference on pension fund surplus                 22.7                -               23.9               -
         Timing difference on provision for redundancies           (0.8)               -               (4.5)              -
         Other timing differences                                  (2.0)             (2.2)             (2.1)            (1.9)
                                                                   ----              ----              ----             ----
                                                                   16.4              41.1              14.5             54.5
                                                                   ====              ====              ====             ====
</TABLE>

17       Deferred Income

       in millions                                      2000        1999
                                                        ----        ----
       Government capital grants                         8.2         4.9
       Other deferred income                             3.9         6.0
                                                        ----        ----
                                                        12.1        10.9
                                                        ====        ====
       Government capital grants
       At 1 April 1999                                   4.9         1.8
       Receivable during the period                      4.8         3.5
       Credited to profit and loss account              (1.5)       (0.4)
                                                        ----        ----
       At 31 March 2000                                  8.2         4.9
                                                        ====        ====




                                     A-23



<PAGE>


Notes continued

18       Called up share capital
<TABLE>
<CAPTION>

                                                               Number of shares                   Group and Company
                                                           2000              1999              2000              1999
                                                       -----------       -----------         ---------         --------
                                                                                              millions         millions
         Authorised
         <S>                                           <C>               <C>                <C>                <C>
         Ordinary shares of 1 each                     125,000,000       125,000,000              125.0          125.0


         Allotted, called up and fully paid                                                      No            millions
                                                                                            -----------        --------
         Ordinary shares of(pound)1 each
         At 1 April 1999                                                                    100,155,951          100.2
         Shares issued at par                                                                 4,411,522            4.4
         Shares issued at a premium of(pound)2.00                                                36,667             -
                                                                                            -----------          -----
         At 31 March 2000                                                                   104,604,140          104.6
                                                                                            ===========          =====
</TABLE>


         At 31 March 2000 options totalling 6,336,312 (1999:  7,941,521) were in
         issue  exercisable  at the  prices  and over the time  frames  detailed
         below.

         Exercisable between                            Exercise         Number
                                                          price         options
                                                        --------       ---------
         10 September 1999 and 10 September 200           1.00         2,245,000
         10 September 1999 and 10 September 2006          1.00           810,000
         16 September 2000 and 16 September 2004          1.30           100,000
         16 September 2000 and 16 September 2004          1.69           179,498
         18 November 2000 and 18 November 2004            1.69            35,000
         18 September 2001 and 18 September 2005          1.69            85,502
         18 September 2001 and 18 September 2005          3.00            30,000
         18 September 2001 and 18 September 2008          3.00            10,000
         8 March 2002 and 8 March 2006                    1.69            35,000
         13 July 2002 and 13 July 2006                    3.00            19,500
         12 October 2002 and 12 October 2006              3.00             1,667
         31 August 2002 and 31 August 2009                3.00             5,000
         13 September 2002 and 13 September 2009          3.00             5,000
         12 October 2002 and 12 October 2009              3.00            10,000
         24 November 2002 and 24 November 2009            3.00         2,765,145
                                                                       ---------
                                                                       6,336,312
                                                                       =========


         At 31 March 2000 warrants totalling 3,726,682 (1999: 3,631,181) were in
         issue which are  exercisable  at the warrant  holders  discretion  at a
         price of 0.01 each.

                                     A-24



<PAGE>


Notes continued

19       Reserves
<TABLE>
<CAPTION>

                                      Group & Company             Company                Group                Company
       in millions                     Share premium            Revaluation         Profit and loss       Profit and loss
                                          Account                 reserve               account               account
                                       --------------           -----------         ---------------       ---------------
       <S>                                  <C>                    <C>                    <C>                   <C>
       At 1 April 1999                      1.9                     87.6                  82.8                  (4.8)
       Premium on shares issued             0.1                      -                     -                     -
       Retained profit for year             -                        -                    10.5                  (4.2)
       Revaluation of investment in         -                       14.7                   -                     -
          subsidiaries
                                           ----                    -----                  ----                  ----
       At 31 March 2000                     2.0                    102.3                  93.3                  (9.0)
                                           ====                    =====                  ====                  ====
</TABLE>


20       Commitments

         (i)      Capital commitments at the end of the financial year for which
                  no provision has been made.

                  In millions        Group      Company      Group       Company
                                      2000        2000        1999         2000
                                      ----        ----        ----         ----

                  Contracted          28.1          -        123.4           -
                                      ====        ====       =====         ====

           (ii)   There  were  no  commitments  at  the  year  end to enter into
                  finance leases starting after the year end.

          (iii)   Annual commitments under non-cancellable  operating leases for
                  land and buildings and equipment delivered by the year end are
                  as follows:
<TABLE>
<CAPTION>

                  in millions                                              2000                          1999
                                                                Land and                     Land and
                                                                buildings        Other       buildings         Other
                                                                  000's          000's          000's          000's
                                                                ---------       -------      ---------        -------
                  Group
                  <S>                                               <C>          <C>             <C>           <C>
                  Operating leases which expire:
                  Within one year                                   0.2           3.8            0.2            4.1
                  In the second to fifth years inclusive            0.2           4.8            -              1.7
                  Over five years                                   0.6          26.6            0.8           12.1
                                                                   ----          ----           ----           ----
                                                                    1.0          35.2            1.0           17.9
                                                                   ====          ====           ====           ====
</TABLE>

                  On the 26 August 1998 the New Locomotive  Finance  Limited,  a
                  wholly owned subsidiary,  agreed to novate to Angel Trains the
                  right to acquire 250 Class 66 and 30 Class 67 locomotives.  On
                  the same date  English  Welsh & Scottish  Railway  Limited,  a
                  wholly owned  subsidiary,  entered a contract to rent the same
                  locomotives under an operating lease of 15 years duration from
                  following the delivery of the last locomotive.  The additional
                  annual rental payable on those  locomotives which had not been
                  delivered  by the  year  end  is  estimated  to be 3.8 million
                  all of which  would  fall  into the over  five  years category
                  in the above table.

                                     A-25

<PAGE>


                                                            Notes continued

20       Commitments continued

         (iv)     Fuel Hedge Contracts

                  English Welsh & Scottish Railway Ltd has entered into a number
                  of fuel  hedge  contracts  for gas oil,  none of which  extend
                  beyond 31 March 2001. The quantity hedged is equivalent to 19%
                  of the projected annual consumption.

         (v)      Interest Rate Contracts

                  English Welsh & Scottish  Railway  Holdings Ltd entered into a
                  contract commencing on 4 September 1997 of five years duration
                  to  pay or  receive  as  appropriate  the  difference  between
                  interest on 25  million at a fixed rate of 7.269% and 3  month
                  LIBOR.

                  On 15 January 1998 New Locomotive  Finance  Limited,  a wholly
                  owned subsidiary,  entered a contract of 27 months duration to
                  pay or receive as appropriate the difference  between interest
                  on US$52  million  at a fixed  rate of 6.07%  and 3 month  US$
                  LIBOR.

         (vi)     Foreign exchange

                  On 17 March 2000, EW&S Railways Limited entered into a forward
                  contract  on  $18  million  at  a  rate  of 1: $1.5734  to  be
                  credited between 1 June and 30 June 2000.

          vii)    Channel Tunnel Access

                  On 22 November 1997 EWS completed the  acquisition  of 100% of
                  the  share  capital  of  English  Welsh  &  Scottish   Railway
                  International    Limited   ("EWSI"),    formerly   Railfreight
                  Distribution Limited, from the British Railways Board ("BRB").
                  In connection with that acquisition:

                  o    BRB has agreed that EWSI will not be required to pay toll
                       charges  for  access to the Channel Tunnel until 30 April
                       2005, such charges being met by BRB.
                  o    In the event that freight  operations through the Channel
                       Tunnel  are  terminated,  EWSI  may be  required  to sell
                       certain tunnel related assets to a publicly owned railway
                       company  and  to  pay  a  5m  penalty.  A  provision  was
                       raised for this penalty on the acquisition of EWSI.
                  o    EWSI  intends to continue its Channel  Tunnel  operations
                       after  April  2005,  but will not be able to do so unless
                       Eurotunnel  materially  reduces its charges.  The present
                       contractual  arrangements do not compel  Eurotunnel to do
                       this,  and  there  is no  certainty  that it  will.  Full
                       provision  is  therefore  made for all  liabilities  that
                       would   arise  if  EWSI   discontinued   Channel   Tunnel
                       operations  after  April  2005.  Consequently,   negative
                       goodwill  arising on the  acquisition is being  amortised
                       over the period to this date.
                  o    BRB has paid a restructuring  grant of (pound)25  million
                       to EWSI. The amount of the grant received during the year
                       was  (pound)12.3   million.   The  grant  is  potentially
                       repayable over 10 years from 2007 if average total access
                       charges fall below and volumes exceed  specified  levels.
                       No  provision  has been  made  for  repayment  of  grants
                       received to date.

21       Pension scheme

         Contributions to the group's defined benefit pension scheme are charged
         to the  profit and loss  account  so as to spread the cost of  pensions
         over employees'  working lives with the group.  The  contributions  are
         determined by a qualified actuary using the projected unit method.  The
         most  recent  valuation  was at 31st  December  1999.  The  assumptions
         adopted by the pension fund's  actuary which have the most  significant
         effect on the results of the valuation are;

                                     A-26



<PAGE>


Notes continued

21       Pension scheme continued

         o  Salary inflation has been assumed to be 4.5% (1999: 6.5%) per annum.

         o  Pensions growth has been assumed to be 3.0% (1999: 4.5%) per annum.

         o  Return  on investments has been assumed to be 7.25% (1999: 9.0%) per
            annum.

         The most recent actuarial valuation showed that the market value of the
         scheme's assets  was 640.4 million (1999: 580.1  million)  and that the
         actuarial  value  of  those  assets  represented  at least 119%  of the
         liabilities for benefits that had  accrued to members,  after  allowing
         for expected future increases in earnings. Since acquisition a  surplus
         has arisen of 10.3  million which is being  amortised to the profit and
         loss account  over the  estimated  working  lives of the employees.

         On 15 October 1997 the trustees of the Railway  Pension Scheme agreed a
         package of benefit  improvements  for members.  At the same time it was
         agreed that employer contributions, previously 7.5% of pensionable pay,
         would  cease for  three  years and that  employee  contributions  would
         continue at 5% of pensionable pay.

         On 22 June 1998 the trustees of the Railway Pension Scheme,  agreed the
         same package of benefit  improvements for EWSI employees.  Similarly it
         was agreed that employer contributions,  previously 7.5% of pensionable
         pay, would cease for three years and that employee  contributions would
         continue at 5% of pensionable pay.

         In addition,  the group operates a defined  contribution pension scheme
         under  which  members  contributions  are  matched on a pound for pound
         basis.

         The  total  pension  cost charge for the period amounted to 4.4 million
        (1999:(pound)2.4 million).



22       Reconciliation  of  operating  profit to net cash inflow from operating
         activities

<TABLE>
<CAPTION>

         in millions                                                            2000            1999
                                                                                ----            ----

         <S>                                                                   <C>             <C>
         Operating profit                                                       25.6            49.8
         Depreciation charge                                                    42.7            18.4
         Amortisation of goodwill                                              (30.1)           (9.2)
         Exceptional write downs                                                13.4              -
         Provision against shares held by EW&S Employee Share Trust             (0.3)            0.9
         (Increase) in stocks                                                   (1.8)           (2.0)
         Decrease in debtors                                                    19.4            14.6
         (Decrease) in creditors and provisions                                (35.9)          (22.3)
                                                                                ----            ----
         Net cash inflow from operating activities                              33.0            50.2
                                                                                ====            ====

</TABLE>





                                     A-27

<PAGE>


                                                            Notes continued

23       Analysis of cash flows for headings netted in the cash flow statement



<TABLE>
<CAPTION>
       in millions

       For the year ended 31 March                                                                2000         1999
                                                                                                  ----         ----
       <S>                                                                                       <C>          <C>
       Returns on investments and servicing of finance
       Interest received                                                                           0.4          0.6
       Interest paid                                                                             (10.9)       (18.9)
                                                                                                  ----         ----
       Net cash outflow for returns on investments and servicing of finance                      (10.5)       (18.3)
                                                                                                  ====         ====

       Capital expenditure and financial investment
       Purchase of tangible fixed assets                                                         (67.3)       (86.9)
       Sale of tangible fixed assets                                                              65.3         42.1

                                                                                                  ----         ----
       Net cash outflow for capital expenditure and financial investment                          (2.0)       (44.8)
                                                                                                  ====         ====
       Acquisitions and disposals
       Acquisition of subsidiary                                                                   -           (3.2)
                                                                                                  ----         ----
       Net cash outflow for acquisitions and disposals                                             -           (3.2)
                                                                                                  ====         ====

</TABLE>


24       Analysis of net debt

<TABLE>
<CAPTION>
       in millions                              At 1 April         Cash flow        Non cash        At 31 March
                                                   1999                             changes            2000
                                                ----------         ---------        --------        -----------
       <S>                                       <C>                  <C>             <C>            <C>
       Cash at bank                                18.4               (8.9)            -                9.5
                                                  -----              -----           -----            -----

       Debt due after one year                   (183.9)              34.6            (1.5)          (150.8)
       Debt due within one year                   (23.3)              (1.7)            -              (25.0)
       Finance leases                              (2.0)               0.3             -               (1.7)
                                                  -----              -----           -----            -----
                                                 (209.2)              33.2            (1.5)          (177.5)
                                                  -----              -----           -----            -----

       Total                                     (190.8)              24.3            (1.5)          (168.0)
                                                  =====              =====           =====            =====
</TABLE>





                                     A-28



<PAGE>


Notes continued

24       Analysis of net debt continued

<TABLE>
<CAPTION>
       in millions
                                                                                      2000           1999
                                                                                      ----           ----
       Reconciliation of net cash flow to movement  in debt

       <S>                                                                          <C>            <C>
       Decrease in cash in the year                                                   (8.9)          (2.2)

       Cash outflow/(inflow) from decrease/increase in debt and lease financing       33.2          (14.5)
                                                                                     -----          -----

       Change in debt resulting from cash flows                                       24.3          (16.7)

       Amortisation of finance costs                                                  (1.5)          (1.5)
                                                                                     -----          -----

       Movement in net debt in the year                                               22.8          (18.2)

       Net debt at 31 March 1999                                                    (190.8)        (172.6)

                                                                                     -----          -----
       Net debt at 31 March 2000                                                    (168.0)        (190.8)
                                                                                     =====          =====

</TABLE>

25       Ultimate parent company and parent undertaking of larger group

         The company has no parent undertaking and therefore its results are not
         consolidated in the accounts of any other entity.

                                     A-29

<PAGE>


Notes continued

26       Supplemental US GAAP information

         As at 31 March 2000, Wisconsin Central Transportation Corporation
         (WCTC), a US company registered with the US Securities and Exchange
         Commission (SEC), held an approximate 42% interest in English Welsh
         & Scottish Railway Holdings Limited (EWSRH).

         Setout below is a reconciliation of the profit and shareholders' funds
         as set out above under UK GAAP to those under US GAAP to comply with
         SEC requirements.

<TABLE>
<CAPTION>
           in millions                                                                    Year ended      Year ended
                                                                                           31 March        31 March
                                                                                             2000            1999
                                                                                          ----------      ----------

           <S>                                                                              <C>              <C>
           Net profit in accordance with UK GAAP                                             10.5            32.8

           Expenditure on rolling stock              (b)                                     (2.0)            7.8
           Pensions                                  (c)                                      1.3             2.0
           Taxation                                  (e)                                      0.3            (4.3)
           Amortisation of goodwill                  (f)                                    (22.4)           (1.7)
           Application of negative goodwill to
           fixed assets                              (g)                                     24.1             2.2
           Provision releases                        (h)                                     (0.6)           (7.2)
                                                                                             ----            ----
           Net profit in accordance with US GAAP                                             11.2            31.6
                                                                                             ====            ====

</TABLE>

<TABLE>
<CAPTION>
           in millions                                                                       As at          As at
                                                                                           31 March        31 March
                                                                                             2000            1999
                                                                                           --------        --------

           <S>                                                                              <C>             <C>
           Shareholders' funds in accordance with UK GAAP                                   199.9           184.9

           Redundancy and restructuring costs                   (a)                          63.0            63.0
           Expenditure on rolling stock                         (b)                          47.1            49.1
           Pensions                                             (c)                           7.0             5.7
           Capitalisation                                       (d)                           0.2             0.2
           Taxation                                             (e)                         (46.9)          (47.2)
           Amortisation                                         (f)                         (27.8)           (5.4)
           Application of negative goodwill to fixed assets     (g)                          27.1             3.0
           Provision releases                                   (h)                          (7.8)           (7.2)
           Shares repurchased under an employee share
           ownership plan                                       (i)                          (2.0)             -
                                                                                            -----           -----
             Shareholders' funds in accordance with US GAAP                                 259.8           246.1
                                                                                            =====           =====

</TABLE>





                                     A-30

<PAGE>


Notes continued

26           Supplemental US GAAP information contd

           The material  adjustments made for US GAAP purposes as analysed above
           are as follows:

           a)          Redundancy and restructuring costs in connection with the
                       acquisition  of businesses  which must be expensed  under
                       FRS 7: "Fair Values in Acquisition Accounting" in the UK,
                       but treated as fair value  adjustments in the acquisition
                       balance  sheet  for US GAAP  purposes,  provided  certain
                       criteria are met ;

           b)          Deferral,  net of 9,958,000  and  8,291,000 amortisation,
                       for the periods ended 31 March 2000 and 1999 respectively
                       of certain expenditures relating to rolling  stock  which
                       has been expensed in the UK GAAP accounts;

           c)          Difference  in  calculation of pension surplus and charge
                       between SSAP 24:  "Accounting for Pensions" in the UK and
                       SFAS 87: "Employers' Accounting for Pensions" and SFAS88:
                       "Employers  Accounting  for  Settlements and Curtailments
                       of  Defined  Benefit Plans and for Termination  Benefits"
                       for US GAAP purposes;

           d)          Capitalisation of interest costs relating to the purchase
                       of fixed  assets which have been  expensed in the UK GAAP
                       accounts;

           e)          Full  provisions for deferred  taxation under US GAAP for
                       the  consequences  of all temporary  differences  between
                       carrying values for financial  reporting and tax purposes
                       (UK  GAAP  only   recognises   deferred  tax  assets  and
                       liabilities  to the  extent  that  they  relate to timing
                       differences   which  are   expected  to  reverse  in  the
                       foreseeable  future ) and taxation  adjustments for other
                       items included in the reconciliation above;

           f)          Goodwill has been  adjusted as a result of certain  US/UK
                       GAAP   differences,   notably  being   increased  by  the
                       redundancy  and  restructuring  costs  resulting  in  the
                       elimination of the capital  reserve  (negative  goodwill)
                       arising  under UK GAAP.  Goodwill is amortised  over a 40
                       year period for US GAAP purposes;

           g)          Under  acquisition  accounting  for  US GAAP  the capital
                       reserve  (negative goodwill)  arising  under  UK GAAP  is
                       partially eliminated against fixed assets;

           h)          552,000  of  eurotunnel   provision charges were credited
                       to  the  profit  and  loss  account  for UK GAAP but were
                       treated as adjustments to Goodwill for US GAAP  purposes;

           i)          Shares  repurchased  from  ex-employees  by a trust  over
                       which the company  exercises  effective  control under UK
                       GAAP as defined by UITF 13 are  disclosed  in the balance
                       sheet as a fixed asset investment. Under US GAAP these
                       would be accounted for as treasury stock and have been
                       deducted from shareholders funds;

           j)          The   group  prepares   its  consolidated  statements  of
                       cashflow   under   Financial   Reporting  Standard  No. 1
                       "Cashflow  Statements"  (FRS  1).    Its  objectives  and
                       principles  are  similar  to  those  set  out  in  the US
                       Statement  of  Financial  Accounting  Standards   No. 95:
                       "Statement  of  Cash  Flows"  (SFAS 95).   The  principal
                       difference    between    the    standards    relates   to
                       classification  under  FRS  1.   The  group  presents its
                       cashflows from  (a) operating activities;  (b) returns on
                       investments and servicing of finance;  (c) taxation;  (d)
                       investing activities and (e) financing activities.   SFAS
                       95 requires only three categories of cashflow activities:
                       (a) operating (b) investing and (c) financing.  Cashflows
                       from taxation and returns on investments and servicing of
                       finance  shown  under FRS1  would be included as cashflow
                       from  operating  activities  under SFAS 95.  In addition,
                       under FRS 1, cash and cash equivalents include short term
                       borrowings  with  original  maturities of three months or
                       less.  SFAS  95  requires  movements  on  such short-term
                       borrowings to be shown under financial activities.

                                     A-31