Use these links to rapidly review the documentTABLE OF CONTENTS INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

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SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 20-F

|/ / | Registration statement pursuant to Section 12(b) or (g) of The Securities Exchange Act of 1934                                  
|--- | --------------------------------------------------------------------------------------------------------------------------------
|or 
|/X/ | Annual report pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 for the fiscal year ended February 28, 2003
|or 
|/ / | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934                                        

Commission file number 333-11948

CONCORDIA BUS AB (publ)(Exact name of Registrant as specified in its charter)

Sweden(Jurisdiction of incorporation or organization)

Solna Strandväg 78, 17154 Solna, Sweden(Address of Principal Executive Offices)

Securities
registered or to be registered pursuant to Section 12(b) of the Act:

None
(Title of Class)

Securities
registered or to be registered pursuant to Section 12(g) of the Act:

None

Securities
for which there is a reporting obligation pursuant to Section 15(d) of the Act:

EURO160,000,000 11% Senior Subordinated Notes due February 2010

(Title of Class)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes: /X/                                      No:
 / /

Indicate
by check mark which financial statement item the Registrant has elected to follow:

Item
17 /X/                                      Item
18 / /

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TABLE OF CONTENTS



|PART I   |  | .                                                                            |  | 1                                                      
|-------- |  | ---------------------------------------------------------------------------- |  | -------------------------------------------------------
|Item 1.  |  | Identity of Directors, Senior Management and Advisors                        |  | 1                                                      
|Item 2.  |  | Offer Statistics and Expected Timetable                                      |  | 1                                                      
|Item 3.  |  | Key Information                                                              |  | 1                                                      
|         |  | A.                                                                           |  | Selected Financial Data                                
|         |  | B.                                                                           |  | Capitalization and Indebtedness                        
|         |  | C.                                                                           |  | Reasons for the Offer and Use of Proceeds              
|         |  | D.                                                                           |  | Risk Factors                                           
|Item 4.  |  | Information on the Company                                                   |  | 8                                                      
|         |  | A.                                                                           |  | History and Development of the Company                 
|         |  | B.                                                                           |  | Business Overview                                      
|         |  | C.                                                                           |  | Organizational Structure                               
|         |  | D.                                                                           |  | Property, Plant and Equipment                          
|Item 5.  |  | Operating and Financial Review and Prospects                                 |  | 24                                                     
|         |  | A.                                                                           |  | Operating Results                                      
|         |  | B.                                                                           |  | Liquidity and Capital Resources                        
|         |  | C.                                                                           |  | Research and Development, Patents, Licenses, etc       
|         |  | D.                                                                           |  | Trend Information                                      
|Item 6.  |  | Directors, Senior Management and Employees                                   |  | 39                                                     
|         |  | A.                                                                           |  | Directors and Senior Management                        
|         |  | B.                                                                           |  | Compensation                                           
|         |  | C.                                                                           |  | Board Practices                                        
|         |  | D.                                                                           |  | Employees                                              
|         |  | E.                                                                           |  | Share Ownership                                        
|Item 7.  |  | Major Shareholders and Related Party Transactions                            |  | 43                                                     
|         |  | A.                                                                           |  | Major Shareholders                                     
|         |  | B.                                                                           |  | Related Party Transactions                             
|         |  | C.                                                                           |  | Interests of Experts and Counsel                       
|Item 8.  |  | Financial Information                                                        |  | 44                                                     
|         |  | A.                                                                           |  | Consolidated Statements and Other Financial Information
|         |  | B.                                                                           |  | Significant Changes                                    
|Item 9.  |  | The Offer and Listing                                                        |  | 44                                                     
|         |  | A.4.                                                                         |  | Market Price Information                               
|         |  | C.                                                                           |  | Markets                                                
|Item 10. |  | Additional Information                                                       |  | 45                                                     
|         |  | A.                                                                           |  | Share Capital                                          
|         |  | B.                                                                           |  | Memorandum and Articles of Association                 
|         |  | C.                                                                           |  | Material Contracts                                     
|         |  | D.                                                                           |  | Exchange Controls                                      
|         |  | E.                                                                           |  | Taxation                                               
|         |  | F.                                                                           |  | Dividends and Paying Agents                            
|         |  | G.                                                                           |  | Statements by Experts                                  
|         |  | H.                                                                           |  | Documents on Display                                   
|         |  | I.                                                                           |  | Subsidiary Information                                 
|Item 11. |  | Quantitative and Qualitative Disclosures About Market Risk                   |  | 56                                                     
|Item 12. |  | Description of Securities Other than Equity Securities                       |  | 57                                                     
|PART II  |  | ..                                                                           |  | 58                                                     
|Item 13. |  | Defaults, Dividend Arrearages and Delinquencies                              |  | 58                                                     
|Item 14. |  | Material Modifications to the Rights of Security Holders and Use of Proceeds |  | 58                                                     
|Item 15. |  | Controls and Procedures                                                      |  | 58                                                     
|Item 16. |  | [Reserved]                                                                   |  | 58                                                     
|PART III |  | ..                                                                           |  | F-1                                                    
|Item 17. |  | Financial Statements                                                         |  | F-1                                                    
|Item 18. |  | Financial Statements                                                         |  | F-49                                                   
|Item 19. |  | Exhibits                                                                     |  | II-1                                                   

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Matters discussed in this document may constitute forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides safe harbor
protections for forward-looking statements in order to encourage companies to provide prospective information about their businesses. Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events on performance, and underlying assumptions and other statements, which are other than statements of historical facts.

Concordia
Bus AB (publ) ("Concordia") desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary
statement in connection with this safe harbor legislation. This document and any other written or oral statements made by us or on our behalf may include forward-looking statements, which reflect our
current views with respect to future events and financial performance. The words "believe," "expect," "anticipate," "intends," "estimate," "forecast," "project" and similar expressions identify
forward-looking statements.

The
forward-looking statements in this document are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's
examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because
these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will
achieve or accomplish these expectations, beliefs or projections.

Except
to the extent required by law, neither Concordia, nor any of its respective agents, employees or advisors intends or has any duty or obligation to supplement, amend, update or
revise any of the forward-looking statements contained or incorporated by reference in this document.

ENFORCEMENT OF CERTAIN CIVIL LIABILITIES

Concordia Bus AB (publ) is organized under the laws of Sweden. Most of our directors, executive officers and our subsidiaries and the independent auditors named
in this annual report are non-residents of the United States. As a result, it may not be possible for investors to effect service of process within the United States upon us, our directors
and executive officers, our subsidiaries or the independent auditors named in this annual report or to enforce against any of them judgements of U.S. courts predicated upon civil liabilities under
U.S. federal securities laws. Although we agree under the terms of the indenture relating to the senior subordinated notes to accept service of process in the United States by an agent designated for
this purpose, it may not be possible for investors to (i) effect service of process within the United States upon our officers and directors and the independent auditors and to
(ii) realize in the United States upon judgements against our officers, directors and independent auditors obtained in U.S. courts predicated upon their civil liabilities, including any
judgements predicated upon U.S. federal securities laws to the extent that a judgment exceeds their U.S. assets. There is also doubt as to the enforceability in Sweden, in original actions or in
actions for enforcement, of judgments of U.S. courts predicted upon the civil liability provisions of the federal securities laws of the United States.

We
appointed CT Corporation System as our authorized agent upon which process may be served in any suit or proceeding arising out of or relating to the senior subordinated notes that may
be instituted in any U.S. federal or state court in the Borough of Manhattan, The City of New York or brought under U.S. federal or state securities laws. CT Corporation System is authorized as our
agent to submit to the jurisdiction of any of these courts in any suit or proceeding arising out of or relating to the senior subordinated notes.

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CURRENCY AND FINANCIAL STATEMENT PRESENTATION

Unless otherwise indicated, references in this annual report to "SEK" or "Swedish Kronor" are to the lawful currency of Sweden; references in this annual report
to "NOK" or "Norwegian Kroner" are to the lawful currency of Norway; references to "euros" or "EURO" are to the single currency of the participating Member States in the Third Stage
of European Economic and Monetary Union of the Treaty Establishing the European Community, as amended from time to time; references to "dollars" or "$" are to the lawful currency of the United States
of America (the "U.S."); and references to "£" are to the lawful currency of the United Kingdom.

Concordia's
and Concordia Bus Nordic's financial statements are prepared in accordance with accounting principles generally accepted in Sweden ("Swedish GAAP"), which differ in some
respects from accounting principles generally accepted in other countries. Any material differences between Swedish GAAP and accounting principles generally accepted in the United States of America
("U.S. GAAP") are discussed in note 33 to Concordia's consolidated financial statements contained elsewhere in this annual report.

Unless otherwise stated in this annual report or unless the context otherwise requires, references to "Concordia," "we," "us" or "our" are to Concordia Bus AB
and, as the context may require, its subsidiaries; for the periods prior to February 28, 2001 references to "Swebus" are references to what has now become Concordia Bus Nordic AB following a
vote by the shareholders, on February 16, 2001, of our ultimate parent company, Concordia Bus BV, to change Swebus' name. For the period after February 28, 2001 references to "Swebus"
are to Swebus AB. See "Information on the CompanyOrganizational Structure"; references to "SBC" are to Ingenior M.O. Schøyens Bilcentraler A/S; references to
"Schøyen Group" are to Schøyen Gruppen A/S; and references to "Bus Holdings" are to Bus Holdings S.a.r.l.

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PART I

Item 1.Identity of Directors, Senior Management and Advisors

Not applicable.

Item 2.Offer Statistics and Expected Timetable

Not applicable.

Item 3.Key Information

A.    Selected Financial Data

Concordia, which was incorporated on September 17, 1999, acquired 100% of the share capital of Concordia Bus Nordic AB ("Concordia Bus Nordic") on
January 14, 2000. From its inception until its acquisition of Concordia Bus Nordic, Concordia was inactive and had insignificant net losses, assets, liabilities and shareholders' equity. As a
result of this acquisition, the carrying value of Concordia Bus Nordic's net assets were increased to Concordia's purchase price and Concordia Bus Nordic's fiscal year-end was changed from
April 30 to the last day of February. Accordingly, the following tables set forth selected historical consolidated financial and operating data for Concordia Bus Nordic as of and for the year
ended April 30, 1999, and the 8.5 month period
ended January 14, 2000 and for Concordia as of and for the 1.5 month period ended February 29, 2000 and the years ended February 28, 2001, 2002 and 2003. This information
should be read in conjunction with the section "Item 5. Operating and Financial Review and Prospects" and the financial statements and the notes thereto of Concordia included elsewhere in this annual
report.

The
summary historical consolidated financial data of Concordia as of and for the years ended February 28, 2001, 2002 and 2003 was derived from the audited consolidated financial
statements of Concordia, which were audited by independent auditors whose reports thereon are included elsewhere in this annual report.

The
consolidated financial statements of both Concordia and Concordia Bus Nordic have been prepared in accordance with Swedish GAAP, which differ in various significant respects from
U.S. GAAP. The significant differences between Swedish GAAP and U.S. GAAP are discussed in note 33 to the consolidated financial statements of Concordia included elsewhere in this annual
report.

1

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|                                              |  | Concordia Bus Nordic |   | Concordia |  
|--------------------------------------------- |  | -------------------- | - | --------- | -
|
|
|
|
|SWEDISH GAAP                                  |  |                      |   |           |  
|Income Statement Data                         |  |                      |   |           |  
|Net revenue                                   |  | 3,115                |   | 2,209     |  
|Operating expenses                            |  | (2,640               | ) | (1,918    | )
|Gain on sale of fixed assets                  |  | 30                   |   | 9         |  
|Depreciation and amortization                 |  | (345                 | ) | (231      | )
|Write-down of fixed assets                    |  | (26                  | ) |          |  
|Strike compensation                           |  | 25                   |   |          |  
|                                              |  |                      |   |           |  
|Operating income (loss)                       |  | 159                  |   | 69        |  
|Financial income (expenses), net              |  | (66                  | ) | (40       | )
|Income tax benefit (expense)                  |  | (39                  | ) | 1         |  
|                                              |  |                      |   |           |  
|Net income (loss)                             |  | 54                   |   | 30        |  
|                                              |  |                      |   |           |  
|Net income (loss) per share                   |  | 338                  |   | 188       |  
|                                              |  |                      |   |           |  
|Balance Sheet Data                            |  |                      |   |           |  
|Total fixed assets                            |  | 2,555                |   |           |  
|Total current assets                          |  | 582                  |   |           |  
|Total shareholder's equity                    |  | 711                  |   |           |  
|Total provisions                              |  | 355                  |   |           |  
|Total noncurrent liabilities                  |  | 1,177                |   |           |  
|Total current liabilities                     |  | 894                  |   |           |  
|Other Financial Data                          |  |                      |   |           |  
|Ratio of earnings to fixed charges(4)         |  | 2.3                  | x | 1.7       | x
|Total capital expenditures                    |  | 358                  |   | 525       |  
|Capital expenditures on buses                 |  | 339                  |   | 279       |  
|Cash flow from operations(5)                  |  | 266                  |   | 349       |  
|Cash flow from investing activities(5)        |  | (255                 | ) | (494      | )
|Cash flow from financing activities(5)        |  | (6                   | ) | 84        |  
|Number of shares                              |  | 160,000              |   | 160,000   |  
|U.S. GAAP                                     |  |                      |   |           |  
|Income Statement Data                         |  |                      |   |           |  
|Operating income (loss)                       |  | 132                  |   | 25        |  
|Net income (loss) before extraordinary items  |  | 52                   |   | (5        | )
|Extraordinary items net of tax                |  |                     |   |          |  
|Net income (loss)                             |  | 52                   |   | (5        | )
|                                              |  |                      |   |           |  
|Basic and diluted net income (loss) per share |  | 325                  |   | (33       | )
|                                              |  |                      |   |           |  
|                                              |  |                      |   |           |  

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|Balance Sheet Data                                      |  |         |   |         |   |         |   |         |      |         |      |         |     
|------------------------------------------------------- |  | ------- | - | ------- | - | ------- | - | ------- | ---- | ------- | ---- | ------- | ----
|Total fixed assets                                      |  | 2,914   |   |         |   | 3,459   |   | 3,505   |      | 3,086   |      | 2,882   |     
|Total current assets                                    |  | 583     |   |         |   | 602     |   | 827     |      | 979     |      | 783     |     
|Total shareholder's equity                              |  | 1,057   |   |         |   | 577     |   | 664     |      | 399     |      | 86      |     
|Total noncurrent liabilities                            |  | 1,546   |   |         |   | 2,756   |   | 2,779   |      | 2,876   |      | 2,644   |     
|Total current liabilities                               |  | 894     |   |         |   | 728     |   | 889     |      | 790     |      | 935     |     
|Other Financial Data                                    |  |         |   |         |   |         |   |         |      |         |      |         |     
|Ratio of earnings to fixed charges(4)                   |  | 2.3     | x | 0.9     | x | 0.2     | x |        | x(4) |        | x(4) |        | x(4)
|OPERATING DATA                                          |  |         |   |         |   |         |   |         |      |         |      |         |     
|Number of buses(6)                                      |  | 3,411   |   | 3,455   |   | 3,289   |   | 4,137   |      | 4,021   |      | 3,949   |     
|Average number of employees                             |  | 5,397   |   | 5,044   |   | 5,206   |   | 6,696   |      | 6,924   |      | 7,484   |     
|Number of kilometers of service provided (in thousands) |  | 219,021 |   | 148,439 |   | 186,134 |   | 223,876 |      | 251,959 |      | 269,198 |     

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The table below sets forth, for the periods and dates indicated, information concerning the exchange rate for the Swedish Kronor against the U.S.
dollar based upon the SEK Noon Buying Rate.

|                       |  | Period End |  | Average(1) |  | High    |  | Low   
|---------------------- |  | ---------- |  | ---------- |  | ------- |  | ------
|1997                   |  | 7.9400     |  | 7.6842     |  | 8.0825  |  | 6.8749
|1998                   |  | 8.1030     |  | 7.9658     |  | 8.3350  |  | 7.5800
|1999                   |  | 8.5050     |  | 8.3006     |  | 8.6500  |  | 7.7060
|2000                   |  | 9.4440     |  | 9.1735     |  | 10.3600 |  | 8.3530
|2001                   |  | 10.4571    |  | 10.4328    |  | 11.0270 |  | 9.3250
|2002                   |  | 8.8570     |  | 9.7361     |  | 10.7243 |  | 8.8308
|2003 (through June 23) |  | 7.8351     |  | 8.3425     |  | 8.8080  |  | 7.6552
|December 2002          |  |            |  |            |  | 9.0808  |  | 8.8308
|January 2003           |  |            |  |            |  | 8.8080  |  | 8.5055
|February 2003          |  |            |  |            |  | 8.5605  |  | 8.4305
|March 2003             |  |            |  |            |  | 8.6830  |  | 8.3855
|April 2003             |  |            |  |            |  | 8.6780  |  | 8.2025
|May 2003               |  |            |  |            |  | 8.1151  |  | 7.7064

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B.    Capitalization and Indebtedness

Not applicable.

C.    Reasons for the Offer and Use of Proceeds

Not applicable.

D.    Risk Factors

Ability to Service DebtTo service our debt, we will require a significant amount of cash. Our ability to generate cash depends on many
factors beyond our control.

Our ability to make payments on and to refinance our debt, including the senior subordinated notes, will depend on our ability to generate cash in the future.
This, to a certain extent, is subject to general economic, financial, competitive and other factors that are beyond our control. Revenues generated by the underlying businesses during the period
March 1 2002- February 28, 2003 have not been sufficient to cover their costs.

We
cannot assure you that (1) our business will generate sufficient cash flow from operations, particularly if our bus fleet grows more rapidly than anticipated, with the
associated increase in operating lease costs, (2) whether improved contract profitability will be achieved or anticipated cost savings, fleet management strategies and operating improvements
will be realized on schedule or at all or (3) future borrowings will be available to us in an amount sufficient to enable us to make required payment on, and redemptions of, our debt, including
the senior subordinated notes, or to fund our other liquidity needs.

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We
may need to refinance all or a portion of our and our subsidiaries' debt, including debt under the senior facilities or the senior subordinated notes or both, on or before maturity.
We may not be able to refinance any of such debt, including debt under the senior facilities and the senior subordinated notes, on commercially reasonable terms or at all, which could have a material
adverse effect on our business.

If we or our Swedish, Norwegian or Finnish operating subsidiaries continue to incur substantial operating losses, we or they may be subject to
liquidation under our respective national regimes.

The respective companies acts and insolvency and reorganization laws of Sweden, Norway and Finland apply to Concordia and its operating subsidiaries. Under these
regimes, if losses reduce the equity of these entities or any of their subsidiaries or of Concordia itself on a stand-alone rather than a consolidated basis to an amount less than 50% of its share
capital, or (in Norway only) if the equity becomes inadequate compared to the risks and the size of its business, the directors of such entity would be obligated by law to convene a general
shareholders meeting to resolve to liquidate such entity unless the directors were able to balance the amount of such equity and the registered share capital (in Sweden, within eight months of such
meeting, and in Finland, within twelve months of such meeting) by (1) increasing the equity in an amount sufficient to achieve such balance and, in the Swedish and Norwegian schemes, to ensure
that its equity becomes adequate compared to the risks and the size of its business, or (2) reducing the share capital to pay off losses in an amount sufficient to achieve such balance,
provided, however, that the share capital is not
less than the minimum statutory share capital of the company. Due to these requirements, Concordia Finland has historically converted part of its shareholder loan from Concordia Bus Nordic into
conditional shareholder contributions.

If
Concordia is not successful in its cost-cutting initiatives and its losses continue, this may cause its equity to decrease sufficiently to require an equity increase or
share capital reduction as described above. See subheading "A. Operating ResultsCritical Accounting PoliciesGoing concern and long term liabilities" under "Item 5.
Operating and Financial Review and Prospects".

Substantial LeverageOur substantial leverage could adversely affect our ability to run our business.

We have now and will continue to have a significant amount of debt. As of February 28, 2003, our total consolidated debt was approximately SEK
2.4 billion and our shareholder's equity was SEK 78 million.

For
the year ended February 28, 2003, our earnings were insufficient to cover our fixed charges by SEK 427 million, calculated on a Swedish GAAP basis, and by SEK
393 million, calculated on a US GAAP basis.

Our
and our subsidiaries' substantial debt could have important consequences for you. For example, it could among other things:



5

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Any
of the foregoing could have a material adverse effect on our business and our ability to make payments under the senior subordinated notes.

If we lose many local public transportation authorities' contracts as they are renewed or we are unable to win new contracts, our business will be
adversely affected.

Our contracts with local public transportation authorities comprise approximately 89.2% of our revenues. Concordia operates in Sweden, Norway and Finland, under
approximately 140, 3 and 30 contracts, respectively, with the largest contract accounting for 4% of Concordia's total revenues and the top 25 contracts accounting for approximately 50% of total
revenues in the year ended February 28, 2003. These contracts usually have a four- to six-year term. Local public transport authorities conduct a competitive bidding
process for each contract shortly before it terminates and the most important criteria for determining the success of the bid is usually price. See the subheading "B. Business
OverviewSwedenContract tendering procedures in Sweden" in "Item 4. Information on the Company" for a discussion of the competitive bidding process in Sweden. If we
fail to continue to renew our local public transportation authorities contracts, our revenues will be adversely affected as our older local public transportation authorities contracts expire which may
affect our ability to satisfy our obligations under the senior subordinated notes or the senior facilities. See the subheadings "C. Material Contracts" under "Item 10. Additional Information."

Our
principal asset is our ownership interest in Concordia Bus Nordic AB which in turn owns the operating companies Swebus, Concordia Finland, and SBC. Our primary source of the funds to
meet our obligations under our indebtedness will be contributions made by Concordia Bus Nordic AB. See subheading "C. Organizational Structure" under "Item 4. Information on the Company."
Management believes that cash from contributions from Concordia Bus Nordic AB will be sufficient to meet its obligations under the senior subordinated notes and the senior facilities. However, in the
event that these cash sources are insufficient to satisfy our cash requirements, we may require additional debt or equity. There can be no assurance that additional debt or equity financing will be
available on terms satisfactory to us, if at all, or that we will be able to incur this additional debt under the terms of the senior subordinated notes or the senior facilities. Furthermore, our
future income, as well as our ability to service or refinance the senior subordinated notes and to repay, extend or refinance the senior facilities, will be subject to future economic conditions and
financial, business and other factors affecting Swebus, Concordia Finland, SBC and us, many of which are beyond our control.

If indices in our contracts do not reflect our cost increases, our business will be adversely affected.

Local public transportation authorities contracts provide for a fee to be paid to us in return for providing bus operations for the routes and schedules described
in the contracts. The amount of the fee to be paid each year is adjusted annually based on an index, or on several indices, that is intended to account for changes in our costs. At present, contracts
with local public transportation authorities which produce a substantial portion of Swebus' revenues in Sweden contain cost indices based on a consumer price index.

6

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While, as tendered contracts expire and new contracts are tendered, it is now becoming increasingly common to include either (i) a price adjustment index which reflects bus
industry costs, or (ii) a combination of a consumer price index and a labor cost index as well as a diesel fuel price index, there can be no assurance this trend will continue. Should we be
unable to include a price adjustment index which reflects bus industry costs in future local public transportation authorities contracts, changes in our costs that are not reflected in the indices
included in these contracts could adversely affect our operating margins.

Competition on price or other factors could adversely affect our business.

It is Concordia's policy to focus on increasing our return on capital and cash generation. Management believes that its change in focus toward more appropriate
tendering levels has been adopted by other major operators, particularly since 1998. Consolidation in the industry and this change in focus among the larger competitors from a tendering strategy based
on increasing market share to a strategy of seeking to maintain adequate margins has recently resulted in more favorable pricing dynamics. Management believes that this trend will continue. For
example, in 2001, tendered contracts were renewed at prices approximately 25-30% over the existing volumes, in 2002 the increases were about 15-20%. However, no assurance can
be given that the more favorable pricing trends will continue in the future for new tenders. For more information, see the subheading "B. Business OverviewSwedenCompetition
in the Swedish Bus Transportation Market" in "Item 4. Information on the Company."

The local public transport authorities rely on government subsidies. Removal of these subsidies would drive down local public transportation
authorities' contract fees.

In Sweden and Norway, management believes that approximately 50% and 30%, respectively, of fees to bus operating companies paid by local public transportation
authorities under local public transportation authorities contracts in 2002 were funded by government subsidies (as opposed to bus ticket revenues). See the subheading "B. Business
OverviewSwedenContractual Public Bus Transportation Service" in "Item 4. Information on the Company" for a discussion of these subsidies. Many European countries have sought
to reduce subsidies in recent years. Should Sweden more aggressively seek to reduce subsidies, fees from local public transportation authorities contracts may decrease, and local public transportation
authorities could seek to renegotiate the scope of existing contracts. A decision to reduce subsidies could have an adverse effect on potential fees under local public transportation authorities
contracts.

Our employees are heavily unionized. Bargaining power and strikes can hurt our business.

Our bus drivers and most of our other employees are unionized. In Sweden, two of our collective bargaining agreements expired on November 30, 2002. We have
renewed these contracts until January 31, 2005. A new collective agreement for drivers and mechanics has been agreed to replace the existing agreement in a new tender. See the subheading "B.
Business OverviewSwedenDrivers and Other Personnel" in "Item 4. Information on the Company." Personnel costs constituted approximately 57% of our total operating expenses
(excluding depreciation and amortization) in the year ended February 28, 2003.

Fluctuation in price and availability of diesel fuel could hurt our business.

Significant changes in fuel availability or costs would materially impact our business. Diesel fuel availability and prices are affected by a number of factors,
including environmental legislation and global economic and political developments, over which we have little to no control. In addition, our costs are affected by annual increases in fuel taxes,
which are largely offset by compensation from indexation. In the event of a shortage in diesel fuel supply resulting from a disruption of oil imports,

7

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reduction
in production or otherwise, we could face higher diesel fuel prices or the curtailment of scheduled diesel fuel deliveries. We enter into hedging arrangements to fix the cost of diesel fuel
before taxes, supplier and transportation costs. As a result of hedging, in the period from March 2002 to February 2003, our total cost of diesel fuel averaged SEK 5.37 per liter. For a
further discussion of Concordia's response to fluctuations in prices or a decrease in fuel availability, including our hedging policies, see the subheading "B. Liquidity and Capital
ResourcesMarket Risk" in "Item 5. Operating and Financial Review and Prospects."

Variations in exchange rates may affect Concordia's performance

Concordia Finland, which comprised 8.3% of Concordia's revenues in fiscal 2003, prepares its financial statements in, and its functional currency is, the Euro. In
preparing its consolidated financial statements, Concordia translates Concordia Finland's financial statements into Swedish Kronor at each reporting period. Consequently, Concordia's results from
operations are affected by fluctuations in the rate of exchange between Swedish Kronor and the Euro. In addition, as of February 28, 2003, SEK 236 million of Concordia's loans relating
to its Finnish operations are denominated in Euro. Concordia's policy is to hedge its currency exposure caused by its Finnish Euro loans by servicing those loans out of the Euro revenues generated by
its Finnish operations. Nevertheless, Concordia may be affected by fluctuations in the rate of exchange between the Swedish Kronor and the Euro.

SBC,
which comprised 9.3% of Concordia's revenues in fiscal 2003, prepares its financial statements in, and its functional currency is, Norwegian Kroner. In preparing its consolidated
financial statements, Concordia translates SBC's financial statements into Swedish Kronor at each fiscal year end. Consequently, Concordia's results from operations are affected by fluctuations in the
rate of exchange between Swedish Kronor and Norwegian Kroner. Variations in exchange rates may affect Concordia's performance.

If Concordia does not retain or gain local public transportation authority contracts, it may not benefit from the option to renew existing operating
lease agreements at a lower cost

Concordia has entered into leasing arrangements for 1,156 of its approximately 3,949 buses. The contracts under which these buses are leased are classified as
operating leases which means that no carrying values are recorded on Concordia's balance sheet in respect to the buses being leased. The term of the lease is established to match an underlying
contract with the local public transportation authority, generally 4-6 years.

The
structure of the lease contract is such that at the inception of a new lease contract, the leasing fee is established based on the fair value at inception and estimated depreciation
of the vehicle during the lease term. At the end of each contract period each leasing contract can be renewed at terms based on the fair value at the date of the extension which are lower than the
payments during the initial term. If Concordia is not successful in renewing or extending the local public transportation authority contracts, it may not gain the benefit of such lower costs.

Item 4.Information on the Company

A.    History and Development of the Company

Our legal name is Concordia Bus AB (publ) and our commercial name is Concordia. We were incorporated on September 17, 1999. Concordia is domiciled in
Sweden and is a public limited liability company. We are incorporated in Sweden and our registered address is Solna Strandväg 78, 17154 Solna, Sweden. Our financial year ends on the
last day of February. Our authorized and issued share capital is SEK 500,000 divided into 5,000 shares of one class with a nominal value of

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SEK
100 each. The share capital is fully paid. Our telephone number is 46 8 546 300 00. Our agent for service of process is CT Corporation System, 111 Eighth Avenue, New York, New York 10011.

The Acquisition of Concordia Bus Nordic

We are an indirect wholly-owned subsidiary of Concordia Bus BV, a company incorporated in The Netherlands.

On
January 14, 2000, we acquired 100% of the issued and outstanding share capital of Concordia Bus Nordic from Stagecoach International BV, a subsidiary of Stagecoach Holdings plc
(the "acquisition"). As consideration for the acquisition, we paid £100,000,000 in cash and assumed approximately SEK 1,430 million of existing indebtedness owed by Concordia Bus
Nordic and its various subsidiaries.

Schøyen
Group formed Concordia Bus BV as a special purpose holding company for the purpose of holding investments in bus transportation businesses. Prior to the acquisition,
Concordia Bus BV was wholly-owned by Schøyen Group. In connection with the acquisition, Concordia Bus BV formed Concordia and Concordia Bus Holding AB, a Swedish company. Concordia Bus BV
owns 100% of the shares of Concordia Bus Holding AB, which in turn owns 100% of the shares of Concordia.

At
the time of the acquisition of Concordia Bus Nordic, a portion of the ownership of Concordia Bus BV was contributed by Schøyen Group so that the issued and outstanding
ordinary shares of Concordia Bus BV was owned approximately 32.98% by Schøyen Group, 2.35% by members of management of Concordia Bus BV and 64.67% by Bus Holdings, an affiliate of Goldman
Sachs International. See the section "A. Major Shareholders" of "Item 7. Major
Shareholders and Related Party Transactions" for a description of the principal shareholders of these entities.

Also,
in connection with the acquisition of Concordia Bus Nordic, Schøyen Group and Concordia entered into the SBC share purchase agreement. That agreement provided for
mutual options designed to bring the business of SBC into the Concordia group of companies by March 1, 2002. In exchange for the transfer to Concordia of all of the shares of SBC under the
terms of that agreement, Schøyen Group received additional ordinary shares in Concordia Bus BV. The issued and outstanding ordinary shares of Concordia Bus BV currently are owned
approximately 47.15% by Schøyen Group, 1.85% by members of management of Concordia and 51.00% by Bus Holdings.

The
present corporate structure of Concordia is set forth below under the heading "Corporate Structure" in this section. Concordia financed the acquisition of Concordia Bus Nordic with
borrowings under a term loan facility, which we refer to as the acquisition facility, and refinanced the then outstanding Concordia Bus Nordic debt with borrowings under a term loan and revolving
credit facility, which we refer to as the Concordia Bus Nordic facility. We refer to the Concordia Bus Nordic facility and the acquisition facility collectively as the senior facilities which are
described in more detail in "B. Liquidity and Capital Resources" in "Item 5. Operating and Financial Review and Prospects."

The Acquisition of SBC

On February 28, 2001, Concordia Bus BV acquired SBC with effect from February 1, 2001. Under the SBC share purchase agreement, an option assignment
existed between SG and Concordia Bus AB. This allowed either one, before March 1, 2002, to bring SBC into the Concordia Bus Group. The option was subsequently transferred by us to Concordia Bus
BV. SG then exercised its option to sell, and as a consequence SBC was acquired by Concordia Bus BV with effect from February 1, 2001 for a consideration to SG of 205,813 Concordia Bus BV
ordinary shares. Under the terms of the agreement a fairness opinion was given by DnB Markets, which was

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in
accord with Concordia Bus BV's valuation of SBC at NOK 320 million (SEK 345 million), creating a goodwill value of SEK 259 million). Concordia Bus BV then transferred this
ownership interest through a share contribution to Concordia Bus Nordic AB.

B.    Business Overview

Concordia provides public transportation services in Sweden, Norway and Finland, operating through its three main operating subsidiaries: Swebus (in Sweden), SBC
(in Norway) and Concordia Finland. Concordia also provides express bus and coach hire services. Note 2 to the consolidated financial statements of Concordia included elsewhere in this annual
report shows a breakdown of total net revenues between those earned from the public transportation authorities ("CTPA") in Sweden, Norway and Finland and revenues earned from the Swedish express bus
("Express") and coach hire ("Interbus") segments for each of the last three financial years. Also, Note 4 to the consolidated financial statements of Concordia included elsewhere in this annual
report shows a breakdown of total net revenues by activity for each of the last three financial years.

Concordia's
core business is providing bus services to local public transportation authorities in Sweden (our most important market), Norway and Finland. Swebus operates approximately
3,310 buses and has a market share of approximately 38% of the public bus transportation market in Sweden (measured by the number of buses in operation). In Finland, Concordia Finland operates
approximately 343 buses in the greater Helsinki area and has market share of 28% of the deregulated bus transport market. In Norway SBC operates approximately 296 buses and an estimated 25% market
share of the public bus transportation market in Greater Oslo and neighboring cities. Concordia's operations in Sweden, Norway and Finland generated net revenues of SEK 4,758 million for the
year ended February 28, 2003.

In
our markets, the substantial majority of bus transportation services are provided under long-term contracts (generally four to six year terms) with local public
transportation authorities, according to which the bus operator provides services for a specific set of bus routes for fixed annual fees (subject to periodic adjustments based on price indices) which
we refer to as "gross agreements." These contracts provide us with steady revenue streams because we receive a fixed annual amount from the respective public transportation authorities rather than
relying on passenger ticket receipts. Certain contracts, called "net agreements," include passenger numbers as part of their pricing. In addition, public transportation authorities have shown an
excellent record of payment and have in the past rarely faced bankruptcy or insolvency. In the fiscal year ended February 28, 2003, Concordia derived approximately 89.2% of its revenues from
these contracts in Sweden, Norway and Finland. We operate under approximately 173 contracts with local public transportation authorities, respectively, the largest of which accounted for only 4% of
our total revenues in the year ended February 28, 2003. The top 25 contracts accounted for approximately 50% of total revenues in the year ended February 28, 2003.

Since
deregulation in 1989, there has been a wave of consolidation which has resulted in three large operators who have a combined market share in the contractual public bus
transportation market in Sweden of approximately 68% based on the number of buses in operation. Swebus is the largest operator with a 35% market share. (Source: Svenska
Lokaltrafikföreningen, the Swedish local traffic organization "SLTF".) Recent tenders for bus transportation contracts provide evidence that consolidation in the industry in Sweden has
produced a more favorable pricing environment. We
expect this trend to continue in the near term. We also believe that a similar pattern of pricing dynamics is now beginning to occur in Norway and Finland.

Since
June 2001, we have progressively implemented the commercially available Hastus traffic planning system, which is now fully operational at all our locations. The Hastus
traffic planning system is augmented by Sintopt our proprietary logistics system, which helps us to improve bus

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and
driver utilization. We are currently in the process of strengthening our traffic planning department in order to better utilize our driver and bus fleet resources.

Similarly,
the improved planning and scheduling described above, combined with an integrated plan for bus fleet utilization and maintenance, enable us to determine with a higher degree
of certainty the optimal number of buses needed for our existing operations. In addition, we are focusing our efforts on utilizing our existing fleet to provide new revenues through alternative uses,
such as local coach and school bus hire.

We
have improved our bus maintenance procedures by implementing a new fleet maintenance planning system. The new fleet maintenance planning system, known as ASW, improves our ability to
schedule bus maintenance and capture costs and analyse data for cost reduction. Going forward, we will improve our ability to schedule maintenance staffing requirements through implementation of an
updated version of ASW. We have also reduced the number of types of buses in our fleet by reducing the number of manufacturers and models we use. In line with our operating lease strategy we have
entered into framework agreements for the supply of buses with Volvo and Evobus. We are currently re-negotiating our agreement with Volvo. We believe that further bus standardization will
continue to reduce maintenance costs and downtime and increase bus utilization.

We
have developed and are in the process of implementing a web-based system for our personnel (such as tracking absence for medical reasons) and a new Operational Management
System (OMS). This system is the last phase of our IT strategy and brings together operational data residing in our centralized database and provides several new ways for us to track our business
operations, such as kilometer/fuel tracking, driver activity capture and daily production statistics. The system is expected to be rolled out in Sweden during 2003.

As
the largest operator of buses in the Nordic region, we have achieved significant savings by centralizing more of our bulk/commodity purchasing. We obtain the majority of our diesel
fuel requirements from the major Nordic petroleum companies. We rent our tires on a per-kilometer basis. We have succeeded in increasing the percentage of purchases that we make under
centralized purchase agreements (excluding fuel and tires) from 10% in 1999
to approximately 95% today and expect to increase the utilization of central purchasing agreements further towards the maximum possible that is practical.

We
have reduced the impact of cost volatility within our business by negotiating for contract adjustment provisions that better reflect operating costs. The level of the fee paid to us
by local public transportation authorities is adjusted periodically based on an index. Historically, a substantial portion of contracts have contained cost indices based on a consumer price index,
which has not appropriately reflected key elements of our cost base such as wages and diesel fuel. We now increasingly seek to include a combination of a consumer price index and a labor cost index as
well as a diesel fuel price index in proportion to our underlying cost base.

We
have also sought to reduce the impact of cost volatility within our business through fuel price and foreign exchange risk hedging. Since the time of the acquisition of Concordia Bus
Nordic, fuel prices have been relatively volatile and increased from SEK 4.20 per liter to a peak of SEK 5.81 per liter in February 2003. This increase was the result of an increase in dollar
denominated diesel fuel prices due to supply restrictions, uncertainty of supply around the period of the war in Iraq and the weakening of the Swedish Krona against the dollar. This increase in the
cost of diesel fuel had a significant adverse impact on our results.

Our
ultimate goal is to become an "asset free" bus operator that acquires transportation capacity by the kilometer and focuses on providing the most efficient bus service possible. We
have initiated a program designed to reduce our residual asset value risk and significantly reduce

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operating
risks, financing costs and capital employed. This program is based on a combination of residual value guarantees and operating leases. In the year ended February 28, 2003, Concordia
had 1,156 buses under operating leases with a present value of future minimum lease payments of SEK 945 million. The key elements of this strategy for Concordia are (i) to match
operating lease terms with the duration of the underlying public transportation contracts and (ii) to obtain residual value guarantees from bus manufacturers for our bus lessors, thereby
facilitating lower cost and flexible operating leasing. If we are successful in implementing this strategy more broadly, we will substantially eliminate our capital expenditure on buses, thereby
freeing up considerable capital.

Sweden



As of February 28, 2003, we operated approximately 3,310 buses in three bus transportation markets in Sweden:



Contractual
public bus transportation services operated approximately 3,140, express bus services 100 buses and coach hire services in Sweden operated 71 buses.



As of February 28, 2003, we were operating approximately 3,140 buses under approximately 140 public bus transportation contracts with local public
transport authorities.

As
of February 28, 2003, we had a market share of approximately 35% (in terms of number of buses) of the Swedish contractual public bus transportation market. We have a relatively
even distribution of our contract portfolio in terms of revenues among the southern, eastern and western regions of Sweden. Due to the economics of the bus industry in the northern region of Sweden,
we have a smaller presence in this region. We intend to focus on areas of high urban concentration and to critically review our contract portfolio with regard to smaller, less profitable contracts,
particularly those relating to areas of relatively low population density.

The
cities of Stockholm, Gothenburg, Malmö and Uppsala, the four largest cities in Sweden, are our most important markets and collectively account for approximately 49% of
our total revenues in Sweden.

Bus
services are provided in the Swedish public bus transportation market according to publicly tendered contracts entered into by bus operators with local public transport authorities.
More than 95% of Swedish bus route contracts are subject to competitive bidding. See the heading "Contract tendering procedures in Sweden" in this section.

Most
Swedish bus operators have similar costs bases, as most bus drivers are in the same unions and most buses meet similar specifications. We believe the difference in competitive power
comes from a bus operator's ability to optimize its depot structure, its skill in planning and scheduling, and its ability to solve the complex logistical issues involved in meeting the requirements
of the contracts. Having access to a large fleet and being able to shift resources significantly benefit the larger operators.

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In Sweden, the administration of public transportation for a particular region is delegated to the relevant local public transport authorities, which plan, price
and coordinate public transport within their geographical area and which enter into contracts with both public and private operators. There are 26 independent local public transport authorities in
Sweden, which cover 21 provinces of Sweden and its five largest cities.

Prior
to 1989, public transportation contracts were not subject to competitive tendering procedures and operators typically monopolized a particular public authority's geographical area
of responsibility. In 1989, Sweden began requiring, subject to specific exceptions, local public transport authorities purchasing bus services to conduct competitive tender procedures. More than 95%
of all contracts for Swedish bus routes are now open to competitive tendering. This deregulation and the resulting price competition led to a reduction in contract prices by an estimated
20-30% in real terms since competitive tendering requirements were introduced in 1989. During this period the underlying costs for bus operators have increased significantly due to
increases in vehicle and diesel fuel taxes and diesel fuel costs. Although operators are compensated based on a consumer price index which takes fuel costs into account, overall, in recent years, this
index has not risen sufficiently despite the increase in the component based on fuel costs to reflect the increase in our costs. Therefore, operators have not been compensated in a manner allowing
them to fully cover their increased costs. This trend has led to consolidation in the industry and begun to produce a more favorable pricing environment. As a result of this, commencing in 1998 and to
a greater extent in 2000 through 2003, we have renewed contracts at higher prices.

Management
believes that, in Sweden, passenger fares typically only cover approximately half the cost of bus service, and the local public transport authorities have subsidized public
transportation. Subsidies have decreased since deregulation began, due primarily to lower fees paid by local public transport authorities as a result of the competitive tendering process. Financial
constraints have also forced many local public transport authorities to reduce the amount of subsidies. On the other hand, municipalities face political pressure to relieve urban congestion and
improve environmental conditions by reducing the use of private cars and increasing the number of commuters using public transportation. In response, municipalities have sought to make the use of
private cars more expensive through raising the price for parking and increasing the number of parking restrictions.



Under Swedish law implementing European Union directives concerning public procurement, public bus transportation contracts must be awarded on a commercial basis,
and subject to limited exceptions, must involve a competitive bidding process.

Typically,
following a study of the community's transportation needs and input from transportation providers, the local public transportation authorities determine the required bus
routes, schedules, fares and other requirements. Invitations to tender contain bid information packages which state the specific routes and timetables to be covered by the operator and usually
contains requirements regarding bus types, technical standards (seats, age, design, etc.), exterior appearance requirements, the environmental standards (such as types of fuel, emissions standards and
requirements for exhaust filters) and quality requirements.

The
local public transport authorities are required to follow established criteria for awarding contracts, of which the single most important is typically price. Other factors may be
considered, including the cost of adapting to a new operator and the level of service quality. In many cases, local public transport authorities choose to subdivide procurement into a series of
contracts, each

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with
a specified portion of a community's routes to avoid having a single operator dominating a large area.



While each public transportation contract is different, there are many terms common to virtually all of them. These contracts, other than contracts for school bus
transportation, are generally for four- to six-year terms, however, many have recently included options to extend the term for an additional one to five years. In some cases,
these options may be exercised by either Swebus or the local transportation authority, but more often these options are exercisable only by the local transportation authority. Extension options
exercisable only by the local transportation authorities generally provide for one or two year extensions.

The
various criteria set forth in the bid information package, as described in the heading "Contract tendering procedures in Sweden" in this section, become part of the contracts. Bus
operators must
then seek to comply with these requirements as efficiently as possible. In isolated cases, there are provisions that an incoming operator must purchase used buses from the outgoing operator.

Public
transportation contracts in Sweden usually provide for fixed fees to be paid to the operator in return for the contracted bus services, which fees are subject to monthly,
quarterly, semi-annual or annual fee adjustments intended to account for changes in costs incurred. At present, contracts with local public transportation authorities which produce a
substantial portion of Swebus' revenues in Sweden contain cost indices based on a consumer price index, although it is becoming increasingly common to negotiate indices which reflect bus industry
costs or an index which contains a labor or fuel cost component. Although management believes that Swebus' indices will match bus operation industry costs more closely than in the past, there can be
no assurance this will be the case. See the subheading "D. Risk FactorsIf indicies in our contracts do not reflect our cost increases, our business will be adversely affected" in "Item 3.
Key Information."

Over
90% of the public transport contracts subject to competitive bidding are gross agreements, which means the operator receives a fixed amount (usually per vehicle kilometer) for
operating the routes and there is no direct financial benefit to the operator for increasing passenger volumes. The local public transportation authorities retain all ticketing revenues and set the
fares.



We operate an extensive network of express bus services under the trade name "Swebus Express" which provide public long distance transportation. In the year
ending February 28, 2003, we employed approximately 100 buses on a full time basis for express bus services in Sweden. We operate daily and weekend services throughout Sweden, including
international routes between Oslo and Stockholm and Oslo, Gothenburg and Copenhagen. Our express buses covered in the aggregate approximately 340,000 kilometers per week during the year ending
February 28, 2003 and transported more than 2.6 million passengers.

For
the year ended February 28, 2003, we had total revenue of SEK 295 million, for express bus services in Sweden. Providing an extensive national network and a seamless
mode of transport between a large number of destinations has become Swebus' main competitive advantage. Swebus Express sells tickets in advance through ticket agencies and on the buses. Swebus' policy
is to provide coaches for any passengers who want to travel and who arrive at the applicable embarkation points at scheduled departure times. We do not allocate particular seats for passengers. We
offer discounts for children, students and pensioners as well as for all passengers travelling on Mondays to Thursdays inclusive (subject to some exceptions). Management believes

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that
the increase in the amount of pensioner travel on Swebus Express reflects pensioners' growing demand for inexpensive flexibly scheduled travel.

Express
bus services in Sweden are generally deregulated so that an express bus service operator has full responsibility for all aspects of the service, including route planning,
schedules and fares. In some regions, express bus services are combined with regional or local public bus services. In these circumstances the local public transportation authorities compensates the
express bus operators for making a number of stops in proximity to a regular local public bus service within a region.

We
believe that the express bus service industry will enjoy continued growth as more routes are developed and more passengers appreciate the price competitive service as compared to rail
and airline services and, more importantly, the high costs of driving private cars. We expect that the potential passenger base for express bus services will expand as the number of people engaged in
long-distance employment or studies increases.



We also operate a coach hire service under the name "Interbus," which as of November 1, 2000 has been operating under a separate legal entity called
"Interbus AB". The coach hire market involves providing chartered bus services, as well as daily and weekend excursions, sightseeing tours and special events. Swebus operates a coach hire service
business in the Stockholm and Gothenburg areas. As of February 28, 2003, Interbus operated approximately 71 full-time coaches and additional express buses as needed. Our coach hire
bus fleet consists of a range of buses from small 10-seat buses to large luxurious sleeper coaches.

For
the year ended February 28, 2003 we had total external revenue of SEK 127 million coach hire services in Sweden. The Swedish coach hire market is concentrated primarily
in densely populated
areas, such as Stockholm, Gothenburg and Malmö. The customer base for the coach hire market is diverse, ranging from small groups organizing private outings to organizers of major
sporting events.

Interbus'
typical customers include major event planners, corporations and travel agencies. Swebus' coach fleet size enables it to meet the requirements of a wide range of customers and
to manage bus transportation for both small and large events. We are one of a few major operators in Sweden which has the capacity to satisfy larger customers. A significant and growing portion of the
coach hire service is related to cruise line operations. Our fleet size improves our competitiveness in this market because cruise ships require operators with significant carrying capacity to ferry
people between the ship and the relevant city, or to provide sightseeing tours. In addition a number of cruise ships were required to dock in a port located approximately 40 kilometers from Stockholm
due to Stockholm port capacity limitations. We are well positioned to meet the demand for the transportation of passengers between this port and Stockholm due to the scale of our bus fleet. Major
sporting events and conferences also offer significant opportunities.



Deregulation has changed the nature of competition in the Swedish bus industry. Over the past several years, the Swedish contractual public bus transportation
market has experienced intense price competition. In this competitive pricing environment, large companies with advantages of economies of scale, such as Swebus and Connex, have enjoyed rapid
expansion at the expense of relatively inefficient larger carriers (including operators owned by the local public transport

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authorities)
and smaller bus operators. As a result of this competition there are currently three large private bus operators.

The
Swedish contractual public bus transportation market features a few operators that hold large shares of the market and many small local operators. Management believes that the
relative market shares of the three largest Swedish bus operators are Swebus (with approximately 3,000 buses, representing approximately 35% of the market), Busslink, (with approximately 1,650 buses,
representing approximately 16% of the market) and Connex (with approximately 1,800 buses,
representing approximately 18% of the market). (Source: SLTF). Swebus, Busslink and Connex are the only national competitors.

In
rural markets, and, in particular, in the northern region of Sweden, large bus companies have faced stiff competition from small local operators. These areas are dominated principally
by smaller, privately owned local operators who have formed into loose cooperative ventures in which bus fleets are pooled and who can operate very flexible schedules and are not heavily unionized.
These factors, combined with the lower levels of operations in northern areas that do not benefit large scale operators, allow these smaller operators to bid for services at prices that are often not
economically viable for larger operators such as Swebus.

In
general, we face more competition on tenders that require less than 40 buses, as there are more operators capable of servicing such requirements. In the tenders for larger contracts,
such as in the major cities, there are generally four operators tendering.



The express bus market in Sweden is fully open to competition and is highly fragmented. In the year ending February 28, 2003 we had approximately more than
50% market share of the Swedish express bus service market, as measured by kilometers served. (Source: SLTF). We operate 100 buses in this market. The next largest operator is
Säfflebussen, operating primarily between Gothenburg and Stockholm and to Oslo. Säfflebussen had a market share exceeding 20% and employs approximately 25 buses.

The
third largest operator is Svenska Buss, which is a joint venture among seven privately owned bus companies and operates primarily in the south of Sweden. Svenska Buss has a market
share of about 10%. Other operators include Y-Bussen, which operates approximately 15 buses primarily between Stockholm and several northern cities.



The coach hire market is fully open to competition, and is more fragmented than the contractual public bus transportation market. While we dedicate approximately
70 buses to coach hire services, the market is characterized primarily by small to medium-sized operators. The medium-sized operators typically have up to 10 buses. The small operators are usually
private companies operating up to four buses, where the owners of the buses both drive and maintain the buses themselves. The small operators are cost efficient and highly competitive, but cannot bid
for larger contracts due to their limited resources. Within the bus industry, the coach hire market is the segment that is most sensitive to general economic conditions, as tourism and attendance of
special events are more directly affected by economic conditions than the basic transportation requirements provided by public contractual bus operators. Nevertheless, we have been able to adjust the
scale of our coach hire operations, so that our operating margins in this segment have been less volatile than revenues in times of downturns.

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In Sweden we have structured autonomous operations for each business line- the CPTA business, the express bus business and coach hire. Each operating
unit management is responsible for preparing and securing new business, operational management, and long term planning. Concordia provides overall business policies and control systems, strategy
related issues and financial, information technology, and property and asset management services.

We
are the largest buyer of buses in the Nordic region, which has enabled us to purchase and lease our buses on more favorable terms and warranties than the industry norm. (Source:
SLTF). Our size permits us to seek favorable terms from suppliers in the Nordic region and elsewhere. Consequently, we are not dependent on any one supplier to meet our bus requirements. We have
entered into framework agreements with Volvo (which is currently under re-negotiation) and Evobus for the supply of our buses going forward. As far as possible, we will continue to acquire
vehicles under operating lease arrangements to meet our bus fleet needs. Currently, in order to comply with fleet age requirements under our existing contracts, we generally acquire
160-200 new buses per year for replacement purposes.



We centralize our fuel purchases in order to benefit from bulk purchases. We obtain the majority of our diesel fuel requirements from the major petroleum
companies in the Nordic region. In the year ended February 28, 2003, we used approximately 102.46 million litres of diesel fuel.



We rent our tires from Michelin. Rental fees are charged on a per kilometer basis. Michelin provides all necessary maintenance with respect to the tires.



For the year ended February 28, 2003, we had an average of 5,950 full-time employees, consisting of 4,918 drivers, 60 traffic administrators,
380 engineering workers and 592 administration/head office staff in Sweden. Should a company lose a public transportation authorities contract, it is often the case that drivers will move to the
company that wins the contract. The incoming operator generally does not need to employ any of these drivers. However, under some circumstances, e.g., the new operator hires additional drivers to
service the routes on the contract, it must offer to hire from the pool of drivers previously employed by the outgoing operator before hiring elsewhere.



The majority of our drivers and maintenance personnel in Sweden are members of trade unions. The principal union to which the drivers and maintenance personnel
belong is Svenska Kommunalarbetareförbundet (the Swedish Municipal Workers Union). A small minority of drivers belong to Svenska Transportarbetareförbundet (the Swedish
Transportation Workers Union).

In
Sweden, wages and general working conditions are generally the subject of nationally negotiated collective bargaining agreements. Our bus drivers and most of our other employees are
unionized. In Sweden, two of our collective bargaining agreements expired on November 30, 2002. We have renewed these expired contracts until January 31, 2005. A new collective agreement
for drivers and mechanics has been agreed which will replace the existing agreement on all our future tenders.

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In
Norway, the union agreement was renegotiated until the end of March 2004 while in Finland collective bargain agreements were reached for the period until the end of
January 2006.

We
believe that our relationships with our employees and unions are good. Swebus has only experienced one industrial disruption in the last five years, in February 1999. This
strike was industry-wide in Sweden and lasted for 13 days. See the subheading "D Risk FactorsOur employees are heavily unionized" in "Item 3. Key Information."



In addition to the state-sponsored pension scheme, we provide pension benefits, under the terms of our collective bargaining agreements, through two plans: Alecta
(formerly Försäkringsbolaget SPP) covers the majority of retired employees under a multi-employer defined benefit plan; Collectum covers the remainder of employees under
a defined contribution plan.



Swebus carries the following types of insurance: general legal and product liability, business package coverage, fleet coverage and business travel insurance.
Swebus believes that it carries types and levels of insurance that are consistent with the types and levels carried by other major bus operating companies in Europe. Swebus does not carry business
interruption insurance, but this is common for many European businesses, particularly those (like Swebus) in which the risk of major interruption of business is small. During 2002 Swebus undertook a
review of its current insurance coverage and the decision was taken to extend the current coverage.



We are required to comply with a series of Swedish and EU environmental, health, and safety regulations. These regulations include requirements regarding emission
standards, safe storage of diesel fuel, and proper maintenance for the buses. In addition, public transportation contracts stipulate additional environmental standards relating to emission standards
and the maintenance of the bus fleet. We believe that Swebus materially complies with these regulations and contract requirements. In one of Swebus' previously owned Gothenburg depots, testing
revealed contamination originating from a previous gas-works facility, owned and operated by the municipality, which was shut-down in the 1960s. To date, we have not been
subject to any legal or administrative proceedings in connection with this issue. We sold this facility in June 2001. The buyer was notified about the prior facility, and had access to the
existing environmental report. In the contract of sale, the buyer renounced all claims against Swebus concerning this facility.



As of January 1, 2003, we have standardized, modernized and centralized our hardware and software applications across Concordia's operations, and the
complete function is now run internally (after previously being outsourced). IT investments have begun to decrease after an intense process of modernizing the information technology systems, and now
that the core systems have been implemented the IT costs are expected to decrease. We currently have four standardized core applications covering financial reporting, traffic planning, fleet
maintenance, and administrative planning, and we have a major project underway regarding the development and implementation of a system which we expect will provide significant productivity
improvements in our daily operations. This system will be fully implemented during 2003. Our Finnish and Norwegian operations and the vast majority of our locations in Sweden are connected to the
Stockholm head office by permanent, high-speed connections. We have established a training center in the head office to ensure a smooth roll-out of the system.

18

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Swebus has six registered trademarks in Sweden: "Swebus Express," "Nepal Resor," "Resecentrum," "Fjällexpressen," "Swebus" and our company logo. In
addition, "Swebus" is a registered trademark in the European Union.



Swebus is not currently involved in any material legal proceedings.

Finland



We operate a Finnish public bus transportation business through our principal subsidiary in Finland, Concordia Finland. Concordia Finland is a major bus operator
in Finland with approximately 340 buses in operation as of February 28, 2003 and approximately 30 public bus transportation contracts with local public transport authorities. Our Finnish
operations generated revenues of EUR 43.4 million for the year ended February 28, 2003. Concordia Finland operates only in the Finnish contractual public bus transportation sector in the
greater Helsinki area in the cities of Helsinki, Vantaa and Espoo, and does not offer either express bus or coach hire services.

Management
estimates that in 2002, the Finnish bus market employed approximately 8,800 buses and generated net turnover of approximately EUR 630 million and included approximately
400 operators. The Finnish bus market is well developed in both rural and urban areas. Finland's geography and low population density make bus transportation very competitively priced as compared to
railway services. Additionally, the passenger railway network is centered on Helsinki and is being reduced in rural areas. This situation provides an advantage to bus operators because they can offer
bus passengers the possibility to make more convenient cross-country trips than on the railways.

The
greater Helsinki area, with a total population close to one million, is Finland's largest market for contractual public bus transportation. The greater Helsinki area and Turku are
the only markets currently subject to competitive bidding. Significant price pressure has led to consolidation in these areas. Except for the greater Helsinki and Turku areas, local traffic in most
cities is largely provided by local operators.



As in Sweden, the administration of public transportation in Finland for a particular region is the responsibility of the local transportation authority. In
greater Helsinki and Turku, public transportation authorities have opened their local public transportation contracts to competitive bidding. In 1994, the Helsinki Metropolitan Area Council, commonly
known as the YTV, which is the authority regulating cross-border public transport traffic between the three cities of Helsinki, Espoo, and Vantaa, was the first to initiate competitive bidding in
Finland. Although the YTV and the public transport authorities regulating public transport traffic within the cities of Helsinki, Espoo, Vantaa and Turku represent the only regions currently open to
competition, the EU Directive discussed above, along with the prospect of cost savings for local authorities, is expected to increase the number of regions open to competitive bidding. Concordia
Finland expects an increase in the number of regions subject to competitive tendering in the near future.

Currently,
in areas other than those referenced above, the local public transport authorities have granted independent operators licenses to run bus services, which essentially gives
each operator a monopoly position. Licenses are normally granted for a three to ten year period and are

19

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usually
renewed with the same operator. We do not have any contractual public bus services agreements in areas not subject to competitive bidding.



In the YTV region, and other areas in which competitive bidding has been instituted, the contract structure and bidding and procurement procedures closely
resembles that of the local public transportation authorities contracts in Sweden described in the subheading "SwedenContract Tendering Procedures in Sweden" and
"SwedenPublic transportation contracts in Sweden" in this section. Typically, the public transportation contracts have four- to five-year terms and under these
contracts all ticket revenues are forwarded to the local public transportation authorities and the operator receives fixed fees. The compensation is adjusted periodically by reference to an index
intended to cover cost items that relate to the bus transportation industry such as drivers' wages, cost of buses and fuel.



For the year ended February 28, 2003, Concordia Finland had an average of 759 employees.

All
of Concordia Finland's employees are represented by unions under the terms of industry-wide collective bargaining agreements. The largest collective bargaining agreement,
which covers drivers and maintenance personnel, expires on February 1, 2006.

Concordia
Finland considers its relations with its employees and the unions to be good. See the subheading "D Risk FactorsOur employees are heavily unionized" in "Item 3.
Key Information."



Concordia Finland is not currently involved in any material legal proceedings.

Norway



SBC is the sixth largest bus operator in Norway, with 300 buses and a market share in the greater Oslo area of approximately 25%, based on results of competitive
tenders. SBC's operations generated revenues of SEK 422 million for the twelve months ended February 28, 2003.

SBC
operates principally in the contractual public bus transportation sector in the city of Oslo and the greater Oslo area of Akershus. Since January 2001, SBC has also had
operations in the counties of Vestfold and Oppland. SBC primarily operates under three traffic agreements, which have been renewed and amended on several occasions since their inception. In 1976, SBC
entered into an agreement with Stor-Oslo Lokaltrafikk AS for public transportation outside the city of Oslo. Stor-Oslo Lokaltrafikk AS is controlled by the local public
transportation authorities in the county of Akershus. This agreement expires in two parts, on June 30, 2003 and on June 30, 2004 and accounts for approximatey 60% of revenues. The
contract that expired on June 30, 2003 will not be renewed due to a lost tender in a contract tender in fall 2002. In 1992, SBC entered into a traffic agreement with AS Oslo Sporveier, which is
controlled by the local public bus transportation authorities in Oslo. This agreement covers public transportation in specific portions of the city of Oslo, expires on December 31, 2003 and
accounted for approximately 20% of revenues in 2002. The agreement with AS Oslo Sporveier replaced a previous agreement between the parties entered into in 1973.

20

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Both
agreements are gross contracts, meaning the local public transportation authorities determines fares, receives all ticket revenue and pays the operator a fee intended to reflect the
operator's costs for operating the bus service. The fee calculation is based on a variety of factors including vehicle mileage, hours of vehicle operation, cost of administration and cost of capital.
All of these factors are adjusted periodically according to cost indices. The final level of compensation is subject to negotiation each year. The total revenue per vehicle kilometre paid to SBC has
decreased by approximately 17% from 1996 to 2002, primarily because of the bargaining strength of its two primary customers.

In
addition to its headquarters in Oslo, SBC has a regional office in Romerike. A majority of real property used in SBC's business is leased from the Schøyen Group.

In
2003, management estimates that the Norwegian market for contractual public bus transportation employed approximately 8,000 buses and amounted to NOK 5.3 billion (SEK
6.1 billion). There are 19 local public transport authorities in Norway each of which is responsible for public bus transportation in one of Norway's 19 counties. In 2002, the local public
transport authorities of Oslo and Akershus (a county immediately outside the city of Oslo) employed 300 and 600 buses, respectively. In 2003, SBC's market shares in its areas of operation were,
management estimates, approximately 20% in Akershus and 25% in Oslo, based on the outcome of competitive tenders.



The administration of public transportation in Norway for a particular region is delegated to the relevant local public transportation authorities, which are
responsible for planning, pricing and coordinating public transport within their geographical area. Local public transport authorities in Norway may subject their bus services' procurement to a
competitive bidding process, but are not required by law to do so. As of February 28, 2003, only 8 of the 19 local public transport authorities in Norway had opted to use competitive bidding
methods as their means of distributing public transportation contracts. SBC expects, however, that further local public transport authorities will follow suit because of the significant cost savings.
If competitive bidding is not used, bus operators negotiate with local public transport authorities to provide exclusive service for specific routes for specified periods (up to ten years). Bus
operators are aware that if they do not offer competitive prices, the authorities will open bidding either in a formal tendering process or by simply requesting competitors to approach them with
offers. The threat of competitive bidding has also increased the bargaining power of the public authorities and caused prices to decrease. The level of public subsidies varies largely from province to
province in Norway, and management estimates that the average level of subsidies in Norway is approximately 30%. SBC believes that the general trend is that the level of subsidies is generally
decreasing. For further information relating to subsidies, see the subheading "D. Risk FactorsThe local public transport authorities rely on government subsidies" in "Item 3. Key
Information."



In Norway, the public transportation market has begun to experience developments similar to those that have occurred in Sweden. These developments include price
competition and consolidation. Nevertheless, the Norwegian bus industry remains fragmented with approximately 600 bus companies operating a total of approximately 9,000 buses in 2002. Almost 90% of
Norwegian bus operators had fleets averaging just over two buses. In contrast to Sweden, competitive bidding is not prevalent and has instead been used for smaller contracts to obtain a "signal
price," which is then used as a target for renegotiating the entire contract portfolio.

21

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SBC
is a major operator in greater Oslo. On a national level, both Norgesbuss AS, and Nettbuss AS (owned by Norges Statsbaner BA, the state railway operator) have significantly larger
fleets than SBC, but neither of them are dominant in any single region.

Since
1989, contracts with public transport authorities in Norway to provide bus services have been potentially subject to competitive bidding procedures. The ability to compel
competitive bidding has
increased the bargaining power of the public authorities, particularly in recent periods, and they have been able to obtain price reductions in their contracts with SBC and increased the risk that SBC
will lose its contracts for bus routes. For further information about risks relating to our current contracts see the subheading "D. Risk FactorsIf we lose many local public
transportation authorities' contracts as they are renewed or we are unable to win new contracts, our business will be adversely affected" in "Item 3. Key Information."

In
order to meet SBC's requirements for new buses, SBC intends to continue to enter into operating leases. In addition, SBC benefits from a residual value guarantee arrangement providing
for the re-purchase of the 352 buses SBC purchased from the Schøyen Group on July 1, 1999, as well as the buses subsequently purchased by SBC from Evobus. Under this
arrangement, the Schøyen Group entered into an agreement with Evobus permitting the Schøyen Group to return buses to Evobus according to stipulated residual value schedules
(which are subject to adjustments). Evobus has made available all the benefits under this agreement to SBC. The arrangement provides for limitations in specific circumstances on the number of buses
that may be returned in any year and on the aggregate number of buses, which may be returned in a multi-year period.



For the period ending February 28, 2003, SBC had an average of 775 full-time employees, of which 638 were drivers, 92 were mechanics and depot
personnel, and 45 were other employees. Of the total workforce, over 90% are full-time employees.

Nearly
all of SBC's employees are represented by unions under the terms of industry-wide collective bargaining agreements. All union agreements are renegotiated every two
years. The largest collective bargaining agreement, which covers drivers and maintenance personnel, expires on April 1, 2004.

SBC
considers its relations with its employees and the unions to be good. See the subheading "D Risk FactorsOur employees are heavily unionized" in "Item 3. Key
Information."



SBC is not currently involved in any material legal proceedings.

22

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C.    Organizational Structure

The following chart sets forth the corporate structure of Concordia.

GRAPHIC

---

D.    Property, Plant and Equipment

Concordia currently leases its facilities, the majority of them for use by Swebus. Swebus conducts its bus operations out of a system of 76 depots and 98 parking
areas located throughout Sweden. These divide as follows:



23

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Some
of the larger depots are located adjacent to bus stations and Swebus rents portions of parking capacity to some external customers. However, Swebus does not operate bus stations.

We
generally select our depot sites according to their proximity to our routes. We intend to examine ways to use sales and leasebacks of depots with flexible lease terms as a way for
Swebus to change depots to adjust to its changing needs as public transportation contracts are won and lost.

Item 5.Operating and Financial Review and Prospects



The following should be read in conjunction with the financial statements of Concordia included in this annual report starting on page
F-2 and with the financial and operating data included in subheading "A. Selected Financial Data" in "Item 3. Key Information." The financial statements of Concordia are prepared in
accordance with Swedish GAAP, which differ in various significant respects from U.S. GAAP. You can find reconciliations of net income, shareholder's equity and other financial statement items and
disclosures regarding differences between Swedish GAAP and U.S. GAAP for fiscal 2003 (as defined), fiscal 2002 (as defined) and for fiscal 2001 (as defined) under the heading "Reconciliation to
accounting principles generally accepted in the United States of America" in Note 33 to Concordia's financial statements.

The financial year end for Concordia is the last day of February. From October 1, 1996 to January 14, 2000, the financial year end for Concordia Bus
Nordic had been April 30. Following the acquisition of Concordia Bus Nordic by Concordia on January 14, 2000, Concordia Bus Nordic and all of its subsidiaries changed their financial
year end to the last day of February. Unless otherwise specified in this discussion, reference to a particular year is to the financial year or period ending the last day of February of that year in
respect of Concordia ("fiscal 2003" and "fiscal 2002," and "fiscal 2001," respectively.) Fiscal 2001 for Concordia includes the historical financial and operating information of SBC for the period
from February 1, 2001 to the period ended February 28, 2001.

As indicated elsewhere in this annual report, Concordia acquired SBC with effect from February 1, 2001. In order to present a meaningful comparison of
Concordia's operations for the period from March 1, 2001 through February 28, 2002 to the corresponding period for the previous year, the following section provides an analysis of
Concordia's results of operations based on its historical consolidated financial data for the period March 1, 2001 through February 28, 2002 (which include the results of operations of
SBC) as compared with certain unaudited pro forma consolidated financial data for the period March 1, 2000 through February 28, 2001 (giving pro forma effect to Concordia's acquisition
of SBC).

Overview

Concordia was incorporated on September 17, 1999 and acquired 100% of the issued and outstanding share capital of Concordia Bus Nordic as of
January 14, 2000. In addition, on February 28, 2001, Concordia Bus BV acquired SBC from Schøyen Group, with effect from February 1, 2001. See subheading "A. History
and Development of the Company" in "Item 4. Information on the Company."

Concordia,
through Concordia Bus Nordic and its other subsidiaries, is the largest private bus operator in Sweden, operating approximately 3,310 buses. In addition, Concordia Finland is
a major operator in Finland, operating approximately 340 buses in the southern region of Finland and SBC is a major operator in Norway, operating approximately 300 buses in the Oslo and greater Oslo
area. Through its subsidiaries, Swebus, Concordia Finland, and SBC, Concordia's core business is

24

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providing
bus services under contracts with local public transportation authorities in Sweden, Norway and Finland, which generated approximately 89.2% of its revenues in fiscal 2003. In fiscal 2003,
Concordia operated under approximately 140, 3 and 30 contracts with local public transportation authorities in Sweden, Norway and Finland, respectively, the largest of which accounted for 4% of its
total revenues and the top 25 contracts accounted for 50% of total revenues. A substantial portion of Swebus' contracts with public transportation authorities provide that Swebus receive a fixed
amount (usually per vehicle kilometer) for operating bus routes which periodically receive adjustments in accordance with cost indices. These contracts typically have a four- to
six-year term. A number of Swebus' contracts with local public transportation authorities are for the provision of bus services specifically for schools in Sweden. These contracts usually
have a shorter term, often two to three years.

Concordia
Bus Nordic also provides both express bus services, which are long distance bus services, and coach hire services, which provide chartered bus services, daily and weekend
excursions, sightseeing tours and special events. Express bus services and coach hire services generated approximately 6.2% and 2.7% of total revenues in fiscal 2003, respectively.

Since
the acquisition of Concordia Bus Nordic, our ownership interest in Concordia Bus Nordic has been our principal asset. Consequently, Concordia's financial condition and results of
operations will be determined to a substantial extent by the financial condition and results of operations of Concordia Bus Nordic.

During
the fiscal year, Swebus faced significant operating difficulties in the Stockholm and Uppsala regions, due largely to inadequate operational planning for our traffic schedules,
which resulted in driver over-capacity during the year. These additional charges amounted to SEK 85 million during the year ended February 28, 2003 and included wages,
subcontracting, maintenance and increased fuel consumption. We now believe that our usage of our driver capacity has returned to more appropriate operating levels.

We
have successfully implemented new traffic plans and initiated a program to restructure our field management operations. In addition, we have made 25 personnel redundant, which will
provide an annualized cost saving of SEK 8 million. We are now implementing additional cost-cutting initiatives and have recruited new business controllers to strengthen our
financial operations going forward. See the subheading "Critical Accounting PoliciesGoing concern matters" in this section.

Our
contracts with public transportation authorities typically provide that the level of fees depends on the volume of operations, which in many cases decline in the summer months. Our
express bus and coach hire services businesses usually experience relatively high revenues from April to September and during December in a given year, as customers tend to use these services during
vacation periods and periods having more favorable weather. In addition, as a result of our collective bargaining agreements, its personnel costs usually increase in the beginning of each calendar
year.

Concordia's
consolidated financial statements have been prepared in accordance with accounting principles generally accepted in Sweden ("Swedish GAAP"), which differ in certain
significant respects from accounting principles generally accepted in the United States of America ("U.S. GAAP"). Note 33 to the consolidated financial statements summarizes the effect that the
application of U.S. GAAP would have on Concordia's 2003, 2002 and 2001 consolidated net loss and shareholder's equity.

25

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The preparation of Concordia's consolidated financial statements requires management to make certain estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. The following paragraphs include
descriptions of some accounting areas that require a higher degree of complexity and/or judgment in making estimates.



Impairment reviews of tangible and intangible fixed assets, including goodwill, are performed whenever there is an indication of possible impairment. The carrying
values of fixed assets, including goodwill related to those assets, are not considered to be recoverable when the expected discounted cash flows from those assets are less than their carrying values.
An impairment loss is determined based on the amount by which the carrying value exceeds the fair value of those assets. Losses on fixed assets to be disposed of are determined in a similar manner,
taking into account the selling price reduced by the costs of disposal.

One
of Concordia's significant assets is its goodwill in Concordia Bus Nordic AB, which in turn has a significant goodwill allocated to its subsidiary Ingeniør M.O.
Schøyens Bilcentraler A/S. If future cash flows do not develop favorably in the future, there is a risk that goodwill may be impaired and need to be written-down. Goodwill is
accounted for in accordance with Swedish GAAP which in certain areas differs from U.S. GAAP. Please see Note 33 item (a), "Goodwill Amortization," to the consolidated financial statements filed
as part of this Form 20-F for a description of those differences.

In
addition to goodwill, Concordia also has significant investments in buses (public services vehicles or "PSVs"). As of February 28, 2003, the carrying value of buses was SEK
1,793 million. The depreciation of these PSVs is based on a straight-line basis over their estimated useful lives which range from 10-14 years depending on the
type of PSV. Recoverability of these assets being held and used is measured by a comparison of the carrying amount of the asset to the future net cash flows expected to be generated by the asset. If
such assets are considered impaired, the impairment loss recognized is measured as the amount by which the carrying value of the asset exceeds the fair value of the asset. If Concordia is not
successful in renewing its contracts at a level such that not all of its buses will be in service, Concordia may have excess bus capacity and therefore may desire to sell these buses to third parties.
In such a situation the carrying value of these buses may exceed the amount that can be recovered in a sales transaction.



Most of Concordia's contracts are derived from 4-6 year contracts with municipalities to provide bus services in a particular area. Under the
terms of these contracts, revenues are generally indexed at a rate corresponding to a consumer price index or a price index which more closely corresponds to the company's actual cost structure in
providing its services, such as an index that considers the significance of changes in diesel prices, payroll costs and other expenses. Due to changes in circumstances and because in certain
situations revenues have not fully compensated for increases in costs, certain contracts have become loss making contracts. Provisions have been recorded for individual loss making contracts without
consideration of expected profits on profitable contracts. Concordia may be required to record additional provisions for loss making contracts in the future if the increase in revenue from the
contracts does not offset the actual increase in costs. See Note 1 to the consolidated financial statements included elsewhere in this Form 20-F.

26

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Concordia has recorded deferred tax assets for the net operating losses generated since Concordia Bus AB's acquisition of Concordia Bus Nordic (fomerly Swebus
AB). Since Concordia had deferred tax liabilities amounting to SEK 239 million, SEK 179 million and SEK 98 million as of February 28, 2001, February 28, 2002 and
February 28, 2003, respectively, arising primarily from the excess of tax depreciation of buses over depreciation for financial reporting, no valuation allowance has been required for these tax
loss carry forwards.

Considering
our history of losses since the acquisition of Concordia Bus Nordic AB, it is not certain that we will be able to continue to offset these tax loss carry forwards against
deferred tax liabilities arising from our excess of tax over book depreciation of buses.



Concordia has approximately SEK 2,435 million of long-term debt due to third parties, excluding long-term finance lease
obligations. Our ability to service our existing debt (interest and amortization) is dependent on the underlying businesses generating sufficient cash flow. Revenues generated by the underlying
businesses during the period March 1, 2002February 28, 2003 have not been sufficient to cover their costs.

Concordia
Bus Nordic AB and its subsidiaries are continuing to implement cost reduction initiatives and have started to see signs of significant improvements in compensation levels from
their contracts with public transportation authorities. If the cost-cutting initiatives or other measures that management deem required are not successful and losses continue, these
companies' equity bases may need to be restored and, if they are not able to comply with the covenants of the debt agreements, they may require waivers from their lenders or additional equity funding
in order to continue to present financial statements under the assumption that Concordia will continue as a going concern.

The
financial statements included beginning on page F-2 have been prepared under the assumption that Concordia will be successful in its initiatives and, consequently, they
have been prepared assuming that Concordia will continue as a going concern. The financial statements have also been prepared under the assumption that Concordia will be in compliance with its debt
covenants for the upcoming 12-month period. If Concordia were to be in breach of any of its debt covenants during the next 12 months, a major portion of its long-term
debt would become due and payable.



Concordia Finland, which comprised 8.3% of Concordia's revenues in fiscal 2003, prepares its financial statements in, and its functional currency is, the Euro. In
preparing its consolidated financial statements, Concordia translates Concordia Finland's financial statements into Swedish Kronor at each reporting period. Consequently, Concordia's results from
operations are affected by fluctuations in the rate of exchange between Swedish Kronor and the Euro. In addition, as of February 28, 2003, SEK 236 million of Concordia's loans relating
to its Finnish operations are denominated in Euro. Concordia's policy is to hedge its currency exposure caused by its Finnish Euro loans by servicing those loans out of the Euro revenues generated by
its Finnish operations. Nevertheless, Concordia may be affected by fluctuations in the rate of exchange between the Swedish Kronor and the Euro.

SBC,
which comprised 9.3% of Concordia's revenues in fiscal 2003, prepares its financial statements in, and its functional currency is, Norwegian Kroner. In preparing its consolidated
financial statements, Concordia translates SBC's financial statements into Swedish Kronor at each

27

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fiscal
year end. Consequently, Concordia's results from operations are affected by fluctuations in the rate of exchange between Swedish Kronor and Norwegian Kroner. Variations in exchange rates may
affect Concordia's performance.

New Accounting Principles to Be Adopted in 2004 and 2005 for Swedish GAAP

In 2004, the following recommendations, issued by the Swedish Financial Accounting Standards Council, become effective: Inventory (RR 2:02), Presentation of
Financial Statements (RR 22), Investment Properties (RR 24), Segment Reporting (RR 25), Events After the Balance Sheet Date (RR 26), Financial Instruments: Disclosure and Presentations (RR 27), and
Accounting for Government Grants (RR 28). In 2005, Employee Benefits (RR 29) becomes effective. Concordia has not completed its assessment of the impact of implementing the new recommendations.

New Accounting Principles to Be Adopted in 2004 for U.S. GAAP

Effective in 2004, the following new accounting standards issued by the United States Financial Accounting Standards Board become effective: Accounting for Asset
Retirement Obligations (SFAS
No. 143), Amendment of Statement 133 on Derivative Instruments and Hedging Activities (SFAS No. 149), and Accounting for Certain Financial Instruments with Characteristics of both
Liabilities and Equity(SFAS No. 150). See Note 33 item (j), "New accounting principles to be adopted during the year ending
February 29, 2004 for U.S. GAAP," to the consolidated financial statements filed as part of this Form 20-F.

28

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Results of Operations

The following table sets forth Concordia's results of operations for the periods indicated in terms of amounts as well as a percentage of revenues.

|                                    |                | Year ended
February 28,
2001(2) |      | Year ended
February 28,
2001(1)(2) |     | Year ended
February 28,
2002(2) |      | Year ended
February 28,
2003
|----------------------------------- | -------------- | ------------------------------- | ---- | ---------------------------------- | --- | ------------------------------- | ---- | ----------------------------
|
|
|
|Net revenues                        |                | 3,576                           |      | 100.0                              |     | 3,997                           |      | 100.0                       
|Operating costs                     |                | (3,299                          | )    | 92.3                               |     | (3,673                          | )    | 91.9                        
|Depreciation and amortization       |                | (364                            | )    | 10.2                               |     | (416                            | )    | 10.4                        
|Gain (loss) on sale of fixed assets |                | 65                              |      | 1.8                                |     | 65                              |      | 1.6                         
|                                    |                |                                 |      |                                    |     |                                 |      |                             
|                                    | Operating loss |                                 | (22  | )                                  | 0.6 |                                 | (27  | )                           
|Financial expenses, net             |                | (286                            | )    | 8.0                                |     | (290                            | )    | 7.3                         
|Income tax benefit                  |                | 83                              |      | 2.3                                |     | 85                              |      | 2.1                         
|                                    |                |                                 |      |                                    |     |                                 |      |                             
|                                    | Net loss       |                                 | (225 | )                                  | 6.3 |                                 | (232 | )                           
|                                    |                |                                 |      |                                    |     |                                 |      |                             

---

|                              |                         | Concordia |      | SBC  |    | PRO FORMA ADJUSTMENTS |      | Concordia |     
|----------------------------- | ----------------------- | --------- | ---- | ---- | -- | --------------------- | ---- | --------- | ----
|
|
|
|Net revenue                   |                         | 3,576     |      | 421  |    |                       |      |           |     
|Operating costs               |                         | (3,299    | )    | (374 | )  |                       |      |           |     
|Depreciation and amortization |                         | (364      | )    | (32  | )  | (12                   | )(a) | (8        | )(b)
|Gain on sale of fixed assets  |                         | 65        |      |     |    |                       |      |           |     
|                              |                         |           |      |      |    |                       |      |           |     
|                              | Operating income (loss) |           | (22  | )    | 15 |                       | (12  | )         | (8  
|Financial expense, net        |                         | (286      | )    | (4   | )  |                       |      |           |     
|Income tax benefit            |                         | 83        |      |      |    |                       |      | 2         | (b) 
|                              |                         |           |      |      |    |                       |      |           |     
|                              | Net income (loss)       |           | (225 | )    | 11 |                       | (12  | )         | (6  
|                              |                         |           |      |      |    |                       |      |           |     

|                                          |  |     |  | 
|----------------------------------------- |  | --- |  | 
|                                          |  |     |  | 
|Goodwill from the acquisition             |  | 259 |  | 
|Annual amortization (20 year useful life) |  | 13  |  | 
|Amortization for the 11-month period      |  | 12  |  | 

29

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The
following table sets forth Concordia's revenues, in terms of amounts as well as a percentage of revenues, and operating income (loss), in terms of amounts and as a percentage of
total operating loss, on the basis of each of its businesses:

|                         |                                                          | Year ended
February 28,
2001(2) |       | Year ended
February 28,
2001(1)(2) |      | Year ended
February 28,
2002(2) |       | Year ended
February 28,
2003
|------------------------ | -------------------------------------------------------- | ------------------------------- | ----- | ---------------------------------- | ---- | ------------------------------- | ----- | ----------------------------
|
|
|
|Revenues:                |                                                          |                                 |       |                                    |      |                                 |       |                             
|                         | Bus services for local public transportation authorities |                                 | 3,092 |                                    | 86.5 |                                 | 3,508 |                             
|                         | Express bus operations                                   |                                 | 260   |                                    | 7.3  |                                 | 260   |                             
|                         | Coach hire operations                                    |                                 | 140   |                                    | 3.9  |                                 | 140   |                             
|                         | Other                                                    |                                 | 84    |                                    | 2.3  |                                 | 89    |                             
|                         |                                                          |                                 |       |                                    |      |                                 |       |                             
|Total revenues           |                                                          | 3,576                           |       | 100.0                              |      | 3,997                           |       | 100.0                       
|                         |                                                          |                                 |       |                                    |      |                                 |       |                             
|Operating income (loss): |                                                          |                                 |       |                                    |      |                                 |       |                             
|                         | Bus services for local public transportation authorities |                                 | (11   | )                                  |     |                                 | (16   | )                           
|                         | Express bus operations                                   |                                 | 20    |                                    |     |                                 | 20    |                             
|                         | Coach hire operations                                    |                                 | 18    |                                    |     |                                 | 18    |                             
|                         | Other                                                    |                                 | (49   | )                                  |     |                                 | (49   | )                           
|                         |                                                          |                                 |       |                                    |      |                                 |       |                             
|Total operating loss     |                                                          | (22                             | )     |                                   |      | (27                             | )     |                            
|                         |                                                          |                                 |       |                                    |      |                                 |       |                             

---

Year ended February 28, 2003 compared to year ended February 28, 2002



Revenues increased SEK 532 million, or 13%, from SEK 4,226 million for the year ended February 28, 2002 to SEK 4,758 million for the
year ended February 28, 2003. Revenues from the provision of bus services for local public transportation authorities increased by SEK 529 million, or 14%, from SEK 3,714 million
for the year ended February 28, 2002 to SEK 4,243 million for the year ended February 28, 2003. SEK 431 million of the increase was derived from our new Stockholm
contracts, which Swebus started to operate on March 4, 2002. The remainder of the increase is attributable to net gain from our contracts re-tendered during the prior financial year
of SEK 49 million and increased revenue from contracts renewed at higher prices of SEK 49 million.

Revenues
from express bus services decreased by SEK 4 million, or 1%, from SEK 299 million for the year ended February 28, 2002 to SEK 295 million for the
year ended February 28, 2003 largely due to the loss of a route concession.

30

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Revenues from coach hire services declined by SEK 16 million, or 11%, from SEK 143 million for the year ended February 28, 2002 to SEK 127 million for the
year ended February 28, 2003 due to a decline in business activity resulting from poor economic developments in this market.

Other
revenues amounted to SEK 93 million for the year ended February 28, 2003 and SEK 70 million for the year ended February 28, 2002. Other revenues largely
consist of sales of diesel fuel and maintenance and repair services to third parties.



Loss on sale of fixed assets is comprised of sales of real estate, buses and other assets. Gain on sale of fixed assets decreased from a gain of SEK
20 million for the year ended February 28, 2002 to a loss of SEK 4 million for the year ended February 28, 2003 due to an exceptional property gain of SEK 14 million
during the year ended February 28, 2002. The difference between 2002 and 2003 was also as a result of a loss on our sale of buses of SEK 14 million during 2003.



Operating costs consist primarily of personnel costs (which include wages, salaries, social security fees and pension costs of bus drivers, mechanics and other
employees), fuel, tires and other consumables costs, and other external costs, which include depot costs and head office administrative costs. Operating costs also include operating lease charges.
Operating costs increased by SEK 523 million, or 13%, from SEK 3,999 million for the year ended February 28, 2002 to SEK 4,522 million for the year ended
February 28, 2003. This increase is due to a number of factors, which are outlined below.

There
has been an 11% increase in personnel costs, by SEK 257 million to SEK 2,597 million, for the year ended February 28, 2003 from SEK 2,340 million for
the year ended February 28, 2002. The increased costs are largely due to an effective 3.2% increase in salary for employees and the cost of implementing our new traffic operations in Stockholm.
In addition, our initial operating difficulties in the Stockholm and Uppsala regions necessitated increased manpower, driver recruitment and
training, over-time and payments for inconvenient hours and additional subcontracting costs.

In
addition, fuel, tires and other consumable costs have increased 14% by SEK 114 million to SEK 919 million for the year ended February 28, 2003 from SEK
805 million for the year ended February 28, 2002, largely due to the new Stockholm contract, higher fuel prices compared to the previous year and increased maintenance costs due to
poorly maintained used buses that were purchased for use in Stockholm.

Other
external costs increased 18% by SEK 152 million, to SEK 1,006 million for the year ended February 28, 2003 from SEK 854 million for the year ended
February 28, 2002. The increase was primarily due to an increase of facility costs of SEK 42 million resulting from increased rent payable due to the sale and lease back of property of
SEK 17 million, additional facilities relating to the new Stockholm contract of SEK 16 million and increased operational costs due to higher electricity prices which was compounded by a
severe cold winter, of SEK 9 million. In addition, provisions for loss making contracts resulted in a charge of SEK 15 million, partially offset by the reorganization and start up costs
provisions taken last year of SEK 24 million.

An
additional factor which explains the increase other external costs is that operating lease charges increased by SEK 120 million to SEK 350 million for the year ended
February 28, 2003 from SEK 230 million for the year ended February 28, 2002. This increase was principally a result of increased operational leasing of buses. The total number of
buses being utilized under operating leases was 1,156 as of February 28, 2003 compared to 784 buses as of February 28, 2002.

31

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Depreciation and amortization charges comprise principally the depreciation of buses and other vehicles but they also relate to the depreciation of tools,
fixtures and fittings, buildings and computer equipment. In addition, amortization of goodwill resulting from acquisitions of bus operations is also included. Depreciation and amortization costs
increased by SEK 10 million, or 3%, from SEK 394 million for the year ended February 28, 2002 to SEK 404 million for the year ended February 28, 2003 principally as
a result of the increased use of operational leasing of buses leading to a decrease in depreciation, which was offset however, by increased depreciation as a result of investments in new buses for the
Stockholm contracts and other renewed contracts where we were required to purchase busses. Total goodwill amortization was SEK 44 million for the year ended February 28, 2003 compared to
SEK 45 million for the year ended February 28, 2002.



The operating loss was SEK 172 million for the year ended February 28, 2003, compared to an operating loss of SEK 147 million for the year
ended February 28, 2002. Operating loss from bus operations for local public transportation authorities was SEK 73 million for the year ended February 28, 2003, compared to an
operating loss of SEK 42 million for the year ended February 28, 2002. Operating profit from express bus services increased by SEK 4 million to SEK 25 million for the year
ended February 28, 2003 compared to SEK 21 million for the year ended February 28, 2002. Operating profit from coach hire services decreased from SEK 10 million for the
year ended February 28, 2002 to SEK 5 million for the year ended February 28, 2003.



Financial income and expenses includes interest income from cash and cash equivalents and interest expense from loans made by banks. Financial expenses net
increased SEK 38 million from SEK 217 million for the year ended February 28, 2002 to net financial expenses of SEK 255 million for the year ended February 28, 2003.
This increase can be primarily attributed to increased interest cost of SEK 33 million relating to the add on of EURO60 million in our senior subordinated notes on
February 27, 2002 combined with decreased income of SEK 8 million due to the gain on the sale of our SPP receivable in 2002. See the heading "Liquidity and Capital Resources" in this
section.



The standard rate of taxation in Sweden is 28%. However, Concordia Bus has not paid any taxes for the year ended February 28, 2003 due to its loss before
income taxes. The effective income tax benefit from the net loss for the year ended February 28, 2003 was 19%. The difference between the standard rate and the effective tax rate is due to
nondeductible goodwill amortization of 3% and the recognition of valuation allowances related to the future tax benefits of the net losses of 6%.

Year ended February 28, 2002 compared to year ended February 28, 2001 (pro forma)



Revenues increased by SEK 229 million, or 5.7%, from SEK 3,997 million for the year ended February 28, 2001 to SEK 4,226 million for
the year ended February 28, 2002. Revenues from the provision of bus services for local public transportation authorities increased by SEK 206 million, or 5.9%, from SEK
3,508 million for the year ended February 28, 2001 to SEK 3,714 million for the year ended February 28, 2002. This increase is a result of an increase in the volume of
kilometers of bus service under existing contracts, the winning of new contracts and renewal of existing contracts at substantially higher prices. In addition, revenue increased as a result of
compensation

32

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for
the cost of increased vehicle license taxes, and the application of cost indices under existing contracts.

Revenues
from express bus services increased by SEK 39 million, or 15% from SEK 260 million for the year ended February 28, 2001 to SEK 299 million for the
year ended February 28, 2002. This increase is largely due to price increases and increased numbers of passengers through the acquisition of the routes previously operated by
"MAS-expressen", a Swedish express coach services provider, and other new routes.

Revenues
from coach hire services increased by SEK 3 million, or 2.1%, from SEK 140 million for the year ended February 28, 2001 to SEK 143 million for the
year ended February 28, 2002, largely as a result of increased tour and conference activity, price increases and expansion of operations in MalmoSweden's third largest city.

Other
revenues amounted to SEK 84 million for the year ended February 28, 2001 and SEK 70 million for the year ended February 28, 2002. Other revenues largely
consist of sales of diesel fuel and maintenance and repair services to third parties.

During
the year ended February 28, 2002, revenues of SEK 3,274 million were generated in Sweden, revenues of SEK 508 million were generated in Norway, and revenues
of SEK 374 million were generated in Finland from bus operations.



Gain on sale of fixed assets is comprised of gains and losses of real estate, buses and other assets held by Swebus. Gain on sale of fixed assets decreased from
SEK 65 million for the year ended February 28, 2001 to SEK 20 million for the year ended February 28, 2002. Of this amount, SEK 14 million was due to the sale of
properties, some of which were immediately leased back, and SEK 6 million to the sale of used buses.



Operating costs consist primarily of personnel costs (which includes wages, salaries, social security fees and pension costs of bus drivers, mechanics and other
employees), fuel, tires and other consumables costs, and other external costs (which include depot costs and head office administrative costs). Operating costs increased by SEK 327 million, or
8.9%, from SEK 3,673 million for the year ended February 28, 2001 to SEK 3,999 million for the year ended February 28, 2002. This increase is due to a number of factors,
which are outlined below.

There
has been a 5.3% increase in personnel costs, by SEK 118 million to SEK 2,340 million, for the year ended February 28, 2002 from SEK 2,222 million for
the year ended February 28, 2001. The increased costs are largely due to increased volume as a result of new contracts and general volume increase and also due to overtime coverage as a result
of extra holiday time taken by employees during the period compared to last year. There has also been an effective 3.4% increase in salary for Swebus' employees. The increase was mitigated by
productivity gains from our new traffic planning system of approximately SEK 9 million.

In
addition, fuel, tires and other consumable costs have decreased 1.9% by SEK 16 million to SEK 805 million for the year ended February 28, 2002 from SEK
821 million for the year ended February 28, 2001, largely due to a decrease in the average price per liter of diesel fuel. The reduction in maintenance costs resulting from our new
purchasing agreements also had a beneficial impact. We also had higher uninsured damage costs of SEK 19 million.

Other
external costs increased 34.1% by SEK 217 million to SEK 854 million for the year ended February 28, 2002 from SEK 637 million for the year ended
February 28, 2001. The increase

33

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resulted
mainly from a increased cost of fuel sold and selling costs related to our express bus activities.



Depreciation and amortization charges comprise principally the depreciation of buses and other vehicles but they also relate to the depreciation of tools,
fixtures and fittings, buildings and computer equipment. In addition, amortization of goodwill resulting from acquisitions of bus operations is also included. Depreciation and amortization costs
decreased by SEK 22 million, or 5%, from SEK 416 million for the year ended February 28, 2001 to SEK 394 million for the year ended February 28, 2002 principally as
a result of the increased operational leasing of buses. There was an exceptional write down of buses of SEK 11 million during the year.



The operating loss increased by SEK 120 million from a loss of SEK 27 million for the year ended February 28, 2001 to a loss of SEK
147 million for the year ended February 28, 2002, as a result of reduced gain on sale of fixed assets compared to last year of SEK 45 million, provisions for the restructuring of
our bus services for local public transportation authorities of SEK 17 million and startup costs relating to our new Stockholm contract of SEK 7 million. There was a reduced gain on sale
from the prior year as a result of a reduction in the number of facilities sold. Operating loss from bus operations for public authorities increased by SEK 26 million from a loss of SEK
16 million for the year ended February 28, 2001 to a loss of SEK 42 million for the year ended February 28, 2002. This was due to a combination of improved revenues and the
effect of cost reduction initiatives. Operating profit from express bus services increased by SEK 1 million to SEK 21 million for the year ended February 28, 2002 compared to SEK
20 million for the year ended February 28, 2001. Operating profit from coach hire services decreased by 8 million to SEK 10 million for the year ended February 28,
2002 compared to the corresponding period in the prior year.



Financial income and expenses includes interest income from cash and cash equivalents and interest expense from loans made by banks. Financial income and expenses
net decreased SEK 73 million from SEK 290 million for the year ended February 28, 2001 to SEK 217 million for the year ended February 28, 2002. This decrease can be
primarily attributed to unrealized exchange gains relating to Euro loans amounting to SEK 68 million compared with the corresponding period last year. See the heading "Liquidity and Capital
Resources" in this section.



The standard rate of taxation in Sweden is 28%. We did not pay any taxes for the year ended February 28, 2002. The effective tax rate for the fiscal year
ended February 28, 2002 was 21%. The effective tax rate for the fiscal year ended February 28, 2002 was 21% as compared to 27% for the year ended February 28, 2001. The
differences in tax rates primarily refer to valuation allowances for the Finnish operating loss tax carryforwards and nondeductible amortization of goodwill.

B.    Liquidity and Capital Resources

We entered into the senior facilities agreement in January 2000 in connection with our acquisition of Concordia Bus Nordic. Since then, Concordia has
achieved faster than expected growth (with consequent impact on our financial flexibility and liquidity). In addition, at the time of the original senior facilities agreement, it was contemplated that
our acquisition of SBC would occur

34

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in
March 2002, and we expected that the senior facilities agreement would have been renegotiated or refinanced by that time. However, Schøyen Group exercised its option to sell us
SBC earlier than expected, and the acquisition of SBC occurred in February 2001. The resulting changes to Concordia's consolidated financial results and group structure caused the terms and
amortization schedule of the senior facilities agreement to be misaligned with our business model and made compliance with certain covenants under the senior facilities agreement open to
interpretation and more difficult than we or our senior lenders anticipated. We therefore renegotiated the terms and amortization schedule of the senior facilities agreement such that there would be
no scheduled amortization payments until January 15, 2004. In connection with the foregoing changes, the amended senior facilities agreement also contains revised covenants which are intended
to be more closely calibrated with our revised group structure and growth profile and to provide more flexibility with respect to our future operating and liquidity needs.

On
February 27, 2002, we issued an additional Euro 60 million of senior subordinated notes, which have the same terms, maturity and interest rate as the Euro
100 million senior subordinated notes we issued in February 2000. The net proceeds of the issuance of the Euro 60 million senior subordinated notes was approximately Euro
57.4 million, after the deduction of underwriting discounts and fees and expenses. The net proceeds were used on the last day of the 2002 fiscal year to:



Concordia
will require cash principally to repay indebtedness incurred in connection with financing the acquisition of Concordia Bus Nordic. Most of this indebtedness is comprised of the
senior subordinated notes and the borrowings under the senior facilities outstanding after the issuance of the senior subordinated notes. The outstanding amount of the senior subordinated notes is
Euro160 million and the senior subordinated notes will mature on February 15, 2010. Interest, accruing at a rate of 11% per annum, is payable on February 15 and August 15
of each year until maturity.

Our
senior debt facilities currently include a term loan of SEK 850 million, a bullet loan of SEK 125 million, a general-purpose revolving credit facility of SEK
100 million and an overdraft facility of SEK 50 million. The loan accrues interest of STIBOR or EURIBOR plus 1.25%2.00%. As of February 28, 2003, SEK
962 million of this facility was outstanding net of pending mandatory

35

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prepayments
of SEK 13 million. As of February 28, 2003 Concordia had total net indebtedness of SEK 2,264 million. The interest expense for the year ended February 28, 2003
was SEK 234 million.

Concordia
has entered into interest and foreign exchange hedging arrangements in accordance with the terms of its debt obligations. You should read the information under the subheading
"Foreign Exchange" in "Item 11. Quantitative and Qualitative Disclosure About Market Risk."

Net
cash provided by operating activities was SEK 11 million for the year ended February 28, 2003 and SEK 95 million for the year ended February 28, 2002; SEK
72 million was used in operating activities for the year ended February 28, 2001. The decrease in cash provided by operating activities for fiscal 2003 compared to fiscal 2002 is
primarily due to the increased loss after financial items and the impacts on our cash flows from increases in current receivables during the period combined with decreases in our current liabilities
in fiscal 2003.

The
increase in net cash from operating activities for the year ended February 28, 2002 compared to fiscal 2001 was largely caused by the SEK 51 million increase in
interest costs being offset by an SEK 110 million decrease in working capital. The increase in interest costs is a result of increased interest rates and a weakening of the Swedish Krona
against the Euro. Only 50% of the euro loan interest is hedged. The decrease in creditors for the period to February 28, 2002 resulted from a decrease in accounts payable of SEK
23 million and a decrease in value-added tax for payables of SEK 61 million. The increase in interest costs in fiscal 2002 resulted from increased annualized costs of borrowing and
increased interest costs due to our issue of senior subordinated notes in February 2000.

Capital
expenditures totaled SEK 216 million for the year ended February 28, 2003. This amount was partially offset by proceeds of SEK 75 million from the sale of
buses, land and buildings, machinery and equipment and a gain of SEK 7 million from the sale of financial fixed assets. We therefore had a net cash flow used in investing activities of SEK
134 million.

Capital
expenditures primarily consisted of purchases of equipment and buses. The high capital expenditure is primarily due to investments in buses for the new Stockholm contracts during
the fiscal 2003 first quarter of SEK 151 million. These buses were financed in connection with a debt restructuring completed in February 2002. Of the remaining capital expenditures of
SEK 65 million, SEK 17 million relates to purchases of equipment and SEK 10 million for the purchase of old gas buses. We have secured finance leases for some of these buses for a
period of 4 years. The remaining expenditure of SEK 38 million relates to necessary bus improvements under our new contracts and compliance with environmental regulations requiring CRT
filters on engines.

During
the year ended February 28, 2002 properties worth SEK 145 million were sold, and the remaining proceeds were generated from other asset sales, primarily sales of
used buses. The SPP (Alecta) receivable was sold during the same period, providing cash of SEK 81 million, of which SEK 34 million was paid to the previous owners of Concordia Bus
Nordic.

We
have complied with all our covenants as of February 28, 2003. With regard to our liquidity position, in addition to a cash balance of SEK 199 million as of
February 28, 2003, we also have access to an un-drawn revolver and to overdraft facilities of SEK 150 million in total. In our opinion, the existing facilities are adequate
for managing Concordia's present working capital requirements.

Concordia
has entered into operating lease agreements to finance a portion of its bus fleet. As of February 28, 2003, 1,156 of Concordia's approximately 3,949 buses were financed
through operating lease arrangements. The net present value of outstanding obligations for buses as of February 28, 2003 was SEK 945 million.

36

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The
operating lease arrangements are entered into with a limited number of lessors and with residual value guarantees from the bus manufacturer at substantially similar contractual
arrangements.

The
lease term for a specific bus is established to match the underlying contract that the specific bus is intended to serve, normally a lease term of 3-5 years with
an option for Concordia to extend the lease period. These arrangements also contain residual value guarantees from the bus manufacturer, whereby the manufacturer guarantees to buy the used bus at a
pre-determined residual value at the end of the lease term from the lessor. Thereby, Concordia has been able to eliminate the underlying risk of being forced to finance the residual value
of its operating lease portfolio.

The
structure of the lease contract is such that at the inception of a new lease contract, the leasing fee is established based on the fair value at inception and the estimated
depreciation of the vehicle during the lease term. If we are successful in renewing or extending a local public transportation authority contract, our leasing contract can be renewed at terms based on
the fair value at the date of the extension. This may result in lease payments which are lower than the payments during the initial term. Our accounting for these lease payments are such that the
leasing fees during the first lease period is expensed on a straight line basis over the duration of the renewal period. The lease costs for any extension or renewal period will be expensed over any
such period.

In
a situation where Concordia is not able to pay outstanding lease fees, the lessor has the right to retain the buses at Concordia's expense and also obtain additional compensation
based on the outstanding leasing fees at the time when the non-payment situation occurred.

As
a result of Concordia's acquisition of Concordia Bus Nordic and its subsidiaries, management has implemented a program to dispose of the company's properties. This program was
designed to provide Concordia with operating flexibility so that if a contract was lost, any related property leases could also be disengaged. Concordia is now in the final phase of this restructuring
and, as a result, a number of the previously owned properties are now leased by Concordia. The leasing period for properties considered strategic for Concordia is 10-15 years and
lease agreements for properties that are intended to serve an underlying contract is limited to the contract period. The
net present value of outstanding obligations for properties as of February 28, 2003 was SEK 58 million.

The
following table summarizes Concordia's contractual obligations and the expected settlement dates for the different obligations:

|                         |                                    |       |       | Payments due by period:
|------------------------ | ---------------------------------- | ----- | ----- | -----------------------
|
|
|Contractual obligations: |                                    |       |       |                        
|Long-term debt           |                                    | 2,435 |       | 138                    
|Operating leases         |                                    | 1,143 |       | 385                    
|Financial leases         |                                    | 33    |       | 8                      
|                         |                                    |       |       |                        
|                         | Total contractual cash obligations |       | 3,611 |                        
|                         |                                    |       |       |                        

For
a discussion of some of the critical terms or covenants which could result in an acceleration of our debt, see the subheading "C. Material Contracts" in "Item 10. Additional
Information."

37

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Market Risk

In order to protect us against fluctuations in the price of diesel fuel, Concordia annually enters into derivatives contracts in order to fix the
non-tax portion of the price of diesel fuel for its bus operations for the year. We currently have hedges in place for diesel fuel costs for the period from March 1, 2003 to
February 28, 2004. We seek to reduce this exposure through managing our fuel price exposure in SEK and have entered into forward purchase contracts for 37% of our fuel requirement for the next
financial year. We believe this managing of our diesel fuel price exposure, together with the protection provided through the diesel fuel price indexation provisions in many of our contracts, will
effectively provide a combined hedge covering approximately 77% of our projected diesel fuel costs in fiscal year 2004. See the subheading "Fuel Prices" in "Item 11. Quantitative and Qualitative
Disclosure About Market Risk."

As
at February 28, 2003, SEK 739 million of indebtedness had a floating rate of interest based on STIBOR. In addition, as of February 28, 2003, SEK
1,696 million of our loans were denominated in Euros. We have entered into collar arrangements through the sale of puts and the purchase of calls to limit the fluctuation in the amount of our
interest payments on the senior subordinated loans, in Swedish Kronor, by limiting our exposure to potential fluctuations in the Swedish Kronor/Euro exchange rate. We have structured the sale of the
puts and the purchase of the calls such that these derivative contracts result in a net zero cost to us. Our policy regarding our operating subsidiary in Finland is to manage, to the extent possible,
our currency exposure caused by our Euro loan within the senior debt by servicing that loan out of the Euro revenues generated by our Finnish operations. We have also entered into Euro interest rate
swaps to manage some of our loans in Finland. See the subheadings "Interest Rates" and "Foreign Exchange" in "Item 11. Quantitative and Qualitative Disclosures About Market Risk."

C.    Research and Development, Patents, Licenses, etc

Not applicable.

D.    Trend Information

During the financial year ended February 28, 2003, we have submitted tenders for 1,011 buses out of the 1,374 that were open for competitive tenders. Of
these, we already operated 409 buses. We have re-won and retained 113 buses and also gained new contracts on 198 buses providing a net renewal rate of 76%.

Pricing
on contracts won was higher by 16%. Our biggest loss was a contract for 60 buses in Norway. In Sweden, losses were due to price competition from smaller players in northern parts
of Sweden where we do not have a strong presence. We believe that the resulting impact of these gains by the new incumbents will not harm our competitive position. In February 2003, our
subsidiary in Sweden was awarded a major contract for approximately 200 buses by the Scaraborg CPTA. One of our competitors, Buss i Vast, filed a complaint against this decision of the
CPTA. The court ruled in favor of the CPTA on June 25. Our competitor has ten days from the decision to make an appeal to a higher court. The contract begins on January 1, 2004.

We
have finalized contractual agreements with our unions for fiscal 2004, which will lead in Sweden to an effective pay increase of 3.7%, and for fiscal 2005, which will lead to a
further effective pay increase of 4.2%. In addition, effective January 1, 2003, our pension costs have increased by 2%. It is not clear at the present time whether the indexation on our CPTA
contracts will fully compensate us for these cost increases.

38

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During fiscal 2004, we expect that approximately 1,211 buses will be available for CPTA contract tenders in Sweden, of which 34% are currently operated by Swebus. We believe that we can
significantly improve our margins in the re-tendering for these contracts (some of which we currently operate at a loss). In Finland, the key tender for fiscal 2004 is a tender contract
for 89 buses in Vanta which we currently operate at a loss. In Norway, we expect that 425 buses will be available for tender, of which SBC currently operates 60 buses. We believe that we have an
opportunity to increase our market share through geographical expansion in the Ostfold and Hamar regions. In June 2003, SBC won a tender in the Ostfold region for approximately 60 buses, which
is currently operated by Norges Buss. SBC will start operating this contract on January 1, 2004. We expect the contract to provide annual revenues of NOK 63 million (approximately
SEK 71 million). The contract is for 5 years, with an option, subject to agreement by both parties, to extend for a further 2 years.

We
have undertaken a strategic review of our operations and are currently evaluating a number of options to strengthen our capital base, including through a deleveraging of our capital
structure.

Management
believes that the favorable pricing environment in Sweden in urban city areas and moderate price increases in Finland will continue in the next fiscal year.

Item 6.Directors, Senior Management and Employees

A.    Directors and Senior Management

Board of Directors

Under the Swedish Companies Act of 1975, the Board of Directors has ultimate responsibility for the organization of Concordia and the management of Concordia's
affairs. Concordia's Articles of Association provide for a Board of Directors elected by its shareholders of not fewer than three nor more than ten directors. Under Swedish law, the chief executive
officer of a company and at least half of the members of the Board of Directors must be resident in an European Economic Area country unless the Swedish government or an authority appointed by the
Swedish government grants an exemption. In a public limited liability company, like Concordia, the chief executive officer may not also serve as the Chairman of the Board of Directors.

Information
concerning the Directors of Concordia is set forth below.

|Name               |  | Age |  | Position             
|------------------ |  | --- |  | ---------------------
|Harald Arnvaern(1) |  | 64  |  | Director             
|Frode Larsen(1)    |  | 51  |  | Director             
|Robert Doumar(2)   |  | 40  |  | Director             
|Richard Sharp(2)   |  | 47  |  | Chairman and Director

---

Harald Arnvaernhas been a member of the Concordia Board of Directors since June 2001. Mr. Arnvaern has been a partner at
the Norwegian law firm Haavind Vislie since 1989. He is the Chairman of the Board of Schøyen Group, Garantiinstituttet for Eksportkredit, AS Vinmonopolet, Fjellinjen AS and A. Falkenberg
Eftf. AS. He is also a member of the Board of Finans Forvaltning Navigare AS, Nordea Abp, and Energiselskapet Buskerud AS. Mr. Arnvaern was born in 1939 and received his law degree from the
University of Oslo in 1964.

39

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Frode Larsenhas been a director since 2001 and the Chief Executive Officer since he joined Concordia in January 2000.
Mr. Larsen joined Schøyen Group in 1989 and served as Managing Director of SBC from 1989 to 1990. He also served as Deputy Chairman of Schøyen Group from 1991 to 1992
and became president of Schøyen Group in 1992. After his appointment as CEO of Concordia, Mr. Larsen continued to serve as president of Schøyen Group, and he currently
divides his time equally between the two positions. He is also the Chairman of the Board of Directors of Schøyen Group, Finans Gruppen Navigere AS, Schøyen Group
International Ltd. and is a member of the Board of Benefits Insurance Company Ltd. and AS Anlegg. Mr. Larsen was born in 1952 and graduated from the Norwegian School of Economics
and Business Administration in 1976 with a degree in business.

Robert Doumarhas been a member of the Concordia Board of Directors since January 14, 2000. Mr. Doumar has been a Managing
DirectorInvestment Banking Division at Goldman, Sachs & Co. since 1998. He is a director of Go Outdoor Systems Holdings S.A. Mr. Doumar was born in 1963 and received JD and
MBA degrees from the University of Virginia in 1989 and his AB degree from Brown University in 1985.

Richard Sharphas been a member of the Concordia Board of Directors since January 14, 2000. Mr. Sharp has been a general
partner at Goldman, Sachs & Co. since 1994 and a Managing Director since 1996. He joined Goldman Sachs in 1984. Mr. Sharp was born in 1956 and received his MA degree from Oxford
University in 1978.

The
Shareholders Agreement (as defined) between Schøyen Group, Bus Holdings and other parties (discussed in the section "Principal Shareholders") provides that specified
significant business decisions by Concordia Bus BV or its subsidiaries, including Concordia, such as mergers, substantial changes to its business activities and incurrence of indebtedness, require
that at least one supervisory board member nominated by both Schøyen Group and Bus Holdings approve the transaction. The supervisory board of Concordia Bus BV is comprised of five members:
two elected by SG, two elected by Bus Holdings, and one independent member nominated by Bus Holdings and acceptable to Schøyen Group.

Senior Management

Day to day management of Concordia has been delegated by Concordia Bus BV under the shareholders' agreement between Schøyen Group, Bus Holdings and
other parties (discussed in the section "Principal Shareholders") to Concordia Bus BV's management board which is comprised of the following persons:

|Name          |  | Age |  | Position                             |  | Year First Employed
|------------- |  | --- |  | ------------------------------------ |  | -------------------
|Frode Larsen  |  | 51  |  | Chief Executive Officer              |  | 2000               
|Vasant Mistry |  | 45  |  | Chief Financial Officer              |  | 2000               
|Georg Kervel  |  | 49  |  | Risk Management and Treasury Officer |  | 2000               

Frode Larsenis both Chief Executive Officer and a director. You should read the information under the heading "Board of Directors" for
information regarding Mr. Larsen.

Vasant Mistryhas been the Chief Financial Officer of Concordia since he joined Concordia in January 2000. Prior to joining
Concordia, Mr. Mistry worked for Schøyen Group as the Executive Director for Finance beginning in September 1998. He served as a Group Finance Director for the Avis
Rent-a-Car division covering Norway, Sweden and Iceland from 1995 to 1998. From 1990 to 1995, he served as the Director for Business Planning and the Director for Pricing and
Marketing Distribution for Hertz Rent-a-Car's Europe, Middle East, and Africa Division, based in London.

40

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Mr. Mistry
is a chartered accountant and has been a member of the Institute of Chartered Accountants in England and Wales since 1986. He was born in 1958.

Georg Kervelhas been the Risk Management Officer of Concordia since he joined Concordia in January 2000. Prior to joining
Concordia, Mr. Kervel worked for Schøyen Group, beginning in 1992. He became a senior executive director of Schøyen Group in 1998, with primary responsibility for SG's
financing and liquidity requirements. He has served on the investment committee of Oslo Fond Forvaltning AS since 1990. In addition, he also served as a member of the Board of Finans-Forvaltning AS
and was chairman of Baerum municipal pension fund from 1994-1996. He is a member of the Board of Liva Bil AS and Skiens Aktiemolle AS. Mr. Kervel was born in 1954 and received a
business degree from the Norwegian School of Economics and Business Administration in Bergen in 1976.

The
following are members of senior management of Concordia that are not members of Concordia Bus BV's management board:

|Name        |  | Age |  | Position                      |  | Year First Employed
|----------- |  | --- |  | ----------------------------- |  | -------------------
|Jan Bosaeus |  | 42  |  | Managing Director (Swebus AB) |  | 2002               

Jan Bosaeusis the Managing Director of Swebus AB. He has been the Managing Director of Swebus since mid October 2002. From
May 2002 he worked as Director of Asset Management in Swebus. From 1999 to 2002 he was in the senior management team of Kalmar LMV Sweden AB, with responsibility for after-sales. He was born
1960 and received a Business Degree from IHM Business School in 1997.

|Name          |  | Age |  | Position                              |  | Year First Employed
|------------- |  | --- |  | ------------------------------------- |  | -------------------
|Stefan Carlén |  | 46  |  | Managing Director (Swebus Express AB) |  | 1983               

Stefan
Carlén is the Managing Director of Swebus Express AB. Stefan has extensive experience within the bus industry. He joined SJ Buss in 1983 and has held different
positions both within SJ Buss and Swebus. In 1999 Stefan became director of Express Division in Swebus.

|Name             |  | Age |  | Position                        |  | Year First Employed
|---------------- |  | --- |  | ------------------------------- |  | -------------------
|Per-Erik Ericson |  | 57  |  | Managing Director (Interbus AB) |  | 1975               

Per-Erik
Ericson is the Managing Director of Interbus AB. Per-Erik joined Interbus in 1975 and has been Managing Director since 1983. He has 31 years of
bus industry experience.

|Name             |  | Age |  | Position                              |  | Year First Employed
|---------------- |  | --- |  | ------------------------------------- |  | -------------------
|Jouni Gustafsson |  | 35  |  | Managing Director (Concordia Finland) |  | 2001               

Jouni Gustafssonis the Managing Director of Concordia Finland. He has been the Managing Director of Concordia Finland (formerly
Stagecoach Finland) since April 2002. From June 2001 to April 2002, he worked as the Finance Director at Concordia Finland. Mr. Gustafsson was born in 1967 and received a
degree in economics from the Helsinki School of Economics and Business Administration in Finland in 1991.

The
senior management of SBC is comprised of the following person:

|Name         |  | Age |  | Position              |  | Year First Employed
|------------ |  | --- |  | --------------------- |  | -------------------
|Sjur Brenden |  | 41  |  | General Manager (SBC) |  | 2000               

41

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Mr. Brenden
was born in 1961 and received an MBA in 1989 in Sundsvall, Sweden. He became the General Manager of SBC in 2000, prior to that he was General Manager of
Sporveiebussene AS. He is a member of the Board of Sporveies Annansene AS.

B.    Compensation

The aggregate fee paid to Concordia's Board of Directors and the senior management for the year ended February 28, 2003 was SEK 14 million. The
aggregate compensation expected to be paid to elected members of Concordia's Board of Directors will be less than SEK 500,000 for the year ended February 28, 2004.

In
addition, the directors and senior management of Concordia may receive options under Concordia Bus BV's share option plan. This option plan provides that the management board of
Concordia Bus BV may grant share options to officers, directors or employees of any of Concordia Bus BV or its subsidiaries, including Concordia and Concordia Bus Nordic, at market value on their date
of issue relating to up to 2.5% of the issued ordinary share capital of Concordia Bus BV. No options have been granted to directors or senior management under the option plan.

Concordia
has a bonus plan for its senior executives based on achieving annual objectives, and established by the Board of Directors. This bonus can be worth up to 100% of the
executive's base salary.

Pension
cost for senior management for the year ended February 28, 2003 amounts to SEK 7 million. There are no retirement benefits to the senior management.

C.    Board Practices

Our directors are elected for a period of one year, with the possibility for re-election each year at the annual general shareholders meeting. There
are no benefits upon termination of employment. Our ultimate parent company, Concordia Bus B.V. has a Supervisory Board comprised of two members elected by Schøyen Group and two members
elected by Bus Holdings, with a chairman chosen as a fifth member by Bus Holdings and who is reasonably acceptable to Schøyen Group. This Supervisory Board sets the yearly remuneration for
both the directors and the management of Concordia Bus AB. We have no formal audit committee. Our Board of Directors receives monthly reports from management as to financial condition and a
sub-group of our Board meets with management approximately every two months to discuss the financial results. In addition, our auditors present their findings and discuss any material
audit issues with our Board of Directors at least annually and with the Supervisory Board of Concordia Bus BV once a year as well.

D.    Employees

The average number of persons (including executive directors) employed by during each of the last three fiscal years was:

Sweden

Finland

NorwayFor the year ended February 28, 2001

5,272

703

721For the year ended February 28, 2002

5,384

745

795For the year ended February 28, 2003

5,950

759

775


42

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E.    Share Ownership

No member of the Board of Directors or of Management beneficially owns at least one percent of the ordinary shares. See subheading "B. Compensation," above, for a
discussion of the share option plan available to directors and senior management of Concordia.

Item 7.Major Shareholders and Related Party Transactions

A.    Major Shareholders

Concordia Bus BV, a company organized under the laws of The Netherlands, owns 100% of the share capital of Concordia Bus Holding AB, which owns 100% of the share
capital of Concordia. Through its ownership of Concordia Bus Holding AB, Concordia Bus BV indirectly controls Concordia.

The
issued ordinary shares of Concordia Bus BV are owned approximately 51.00% by Bus Holdings, an affiliate of Goldman Sachs International, 47.15% by SG, and 1.85% by members of
management and others.

Subscription and Shareholders' Agreement

Schøyen Group, Bus Holdings and other parties have entered into a subscription and shareholders' agreement as the shareholders of Concordia Bus BV.
The shareholders' agreement provides, among other things, that the supervisory board of Concordia Bus BV, which is ultimately responsible for management of its affairs, be comprised of five members:
two elected by Schøyen Group, two elected by Bus Holdings, and one independent member nominated by Bus Holdings and acceptable to Schøyen Group. Specified significant
business decisions by Concordia Bus BV or its subsidiaries, including Concordia, such as mergers, substantial changes to its business activities and incurrence of indebtedness require that at least
one supervisory board member nominated by Schøyen Group and one supervisory board member nominated by Bus Holdings approve the transaction. Day to day management of Concordia Bus BV and
its subsidiaries has been delegated to a management board comprised of five members who are jointly appointed by Schøyen Group and Bus Holdings. The members of this management board are
members of senior management of Concordia. For further information about management see the subheading "A. Directors and Senior ManagementSenior Management" in "Item 6. Directors, Senior
Management and Employees" The shareholders' agreement also provides for specified transfer restrictions, rights of first offer, tag-along rights and bring-along rights, and provisions
regarding change of control. If specified conditions are met, the tag-along rights require a proposing shareholder to allow other shareholders to dispose of their shares under the same
terms and conditions as the proposing shareholder and the bring-along rights require other shareholders to dispose of their shares under the same terms and conditions as the selling shareholder.

In
conjunction with the shareholders' agreement, Schøyen Group and Bus Holdings caused Concordia Bus BV to create a share option plan and enter into a management services
agreement with Concordia Bus Management A/S, a wholly owned subsidiary of Concordia Bus BV, and caused Concordia Bus Management A/S to enter into service agreements with members of Concordia Bus BV's
management board who are members of senior management of Concordia. For further information about these agreements and the options plan see the section "B. Related Party Transactions," below.

B.    Related Party Transactions

Two of the supervisory board members of Concordia Bus BV, the parent company of Concordia Bus AB are appointed by Schøyen Gruppen A/S
("Schøyen Group") and two are appointed by Bus

43

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Holdings
S.A.R.l, an affiliate of Goldman Sachs International. Each director of Concordia may receive compensation for services in that capacity. Erik Linnarsson is a partner at Advokatfirman Lindahl
HB, which acts as legal counsel to Concordia and he was formerly a director of Concordia Bus AB and remains a director of certain of our operating subsidiaries.

Under
a lease arrangement between Schøyen Group and Ingeniør M.O. Schøyens Bilcentraler A/S, Schøyen Group has leased depots and other
real property to SBC for a period of ten years ending in 2009. The rentals paid were SEK 15 million, SEK 14 million, and SEK 13 million for the years ended February 28,
2003, 2002 and 2001, respectively.

Schøyen
Prosjekt and Finans ASA, an affiliated company of Schøyen Group, was engaged to provide consulting services in relation to the acquisition by Concordia of
Sporveiebussen AS, an operator of approximately 160 buses in Norway. The fees paid for their services were SEK 0.3 million and SEK 0.6 million for the years ended February 28,
2002 and 2001, respectively. In addition, they have been engaged in connection with securing the sale and leaseback of properties belonging to Swebus. For the year ended February 28, 2002,
their fees for this service were SEK 2.4 million and SEK 0.5 million for the years ended February 28, 2002 and 2001, respectively. No services were provided by Schøyen
Prosjekt and Finans ASA during the year ended February 28, 2003.

In
addition to being 18% owned by SG, Schøyen Prosjekt and Finans ASA is 72% owned by Finans Forvaltning AS. Finans Forvaltning AS is 51% owned by Frode Larsen, 22.25% owned
by Georg Kervel, and 4.5% owned by Harold Arnvaern.

Concordia
Bus Management A/S, an affiliated company 100% owned by Concordia Bus BV, has provided management services to Concordia Bus AB and its subsidiaries. A management fee has been
charged to Concordia Bus AB and their subsidiaries for these services amounting to SEK 23 million, SEK 25 million, and SEK 31 million for years ended February 28, 2003,
2002 and 2001, respectively.

C.    Interests of Experts and Counsel

Not applicable.

Item 8.Financial Information

A.    Consolidated Statements and Other Financial Information

See Item 17.

Legal Proceedings

None.

Dividend Distribution Policy

Not applicable.

B.    Significant Changes

None.

Item 9.The Offer and Listing

(Items 9A 1-3, 9A 5-7, B, D, E and F are not applicable).

44

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A.    4. Market Price Information

Not applicable.

C.    Markets

Not applicable.

Item 10.Additional Information

A.    Share Capital

Not applicable.

B.    Memorandum and Articles of Association



45

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C.    Material Contracts



46

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47

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Year

Percentage2005

105.500
%2006

103.667
%2007

101.833
%2008 and thereafter

100.000
%




48

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49

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|Repayment Date(s)                                    |  | Amount Due
(in SEK)
|---------------------------------------------------- |  | -------------------
|January 15, 2004, July 15, 2004 and January 17, 2005 |  | 125 million        
|July 15, 2005 and January 16, 2006                   |  | 150 million        
|July 17, 2006                                        |  | 175 million        
|                                                     |  |                    
|Total                                                |  | 850 million        
|                                                     |  |                    





50

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51

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D.    Exchange Controls

There are currently no Swedish laws or regulations that restrict the import or export of capital or the remittance of dividends or interest to
non-resident holders of our securities.

E.    Taxation

The following discussion summarizes certain Swedish and United States tax consequences of the ownership and disposition of the senior subordinated notes. This
discussion is based on laws currently in force, as interpreted and applied as of the date of this annual report. Those laws are subject to change after the date of this annual report, possibly with
retroactive effect. This discussion does not purport to describe all of the tax considerations that may be relevant to you in light of your particular circumstances. You are advised to consult with
your own tax advisors as to the Swedish and United States tax consequences to you of the purchase, ownership and disposition of the senior subordinated notes, including the effect of any state or
local tax laws or the laws of any other country.

Swedish Tax Considerations

The following is a summary of certain principal Swedish income, wealth, inheritance and gift tax considerations for purchasers of the senior subordinated notes.
The purpose of the summary is to generally outline certain Swedish tax consequences to Non-Swedish Holders (defined below). This summary does not discuss all aspects of Swedish income,
wealth, inheritance and gift taxation that may apply to particular investors because of their individual investment circumstances. In addition, this summary does not discuss any foreign tax
considerations. As used herein, a "Non-Swedish Holder" is a beneficial owner of a senior subordinated note that is:



Under
Swedish law, payments of any principal or interest to a Non-Swedish Holder will not be subject to Swedish income tax unless the Non-Swedish Holder carries
on a trade or business in Sweden where the payments of principal or interest are attributable to a permanent establishment. In addition, neither the senior subordinated notes nor any
Non-Swedish Holder thereof will be subject to Swedish inheritance or gift tax unless the Non-Swedish Holder:



Sweden
does not levy any inheritance tax on the estate of a Non-Swedish Holder. No Non-Swedish Holder of the senior subordinated notes will be subject to Swedish wealth tax.

Swedish
law does not impose withholding tax on payments of principal or interest to a Non-Swedish Holder of any senior subordinated note.

52

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Under
Swedish law, capital gains realized on a sale of a senior subordinated note by a Non-Swedish Holder will not be subject to Swedish income tax unless the
Non-Swedish Holder carries on a trade or business in Sweden where the capital gains are attributable to a permanent establishment.

United States Federal Tax Considerations

The following discussion is a summary of certain US federal income tax consequences of the purchase, ownership and disposition of the senior subordinated notes by
US Holders (as defined below). This summary is not a complete analysis or description of all potential tax consequences to US Holders and does not address all tax considerations that may be relevant
to all categories of potential purchasers (such as banks, financial institutions, insurance companies, dealers in securities or commodities, tax-exempt investors, investors whose
functional currency is not the US dollar, investors that hold senior subordinated notes as part of a "straddle" or "conversion transaction" and other investors subject to special rules).

You
are urged to consult your own tax advisors concerning the US federal, state and local tax consequences, as well as any applicable foreign tax consequences, of the purchase, ownership
and disposition of the senior subordinated notes.

This
summary is based on the Internal Revenue Code of 1986, as amended, judicial decisions, administrative pronouncements, and existing and proposed Treasury regulations, changes or
differing interpretations to any of which after the date of this annual report could apply on a retroactive basis and affect the tax consequences described herein.

As
used herein, "US Holder" is a beneficial owner of a senior subordinated note that (1) holds the senior subordinated note as a capital asset and (2) is, for US federal
income tax purposes:



In
the case of any partnership (or other entity treated as a partnership for US federal income tax purposes), it will be considered a US Holder to the extent that its partners are
described above.



Subject to the discussion under "Amortizable Bond Premium" below, payments of interest on a senior subordinated note will be includible in the gross income of a
US Holder as ordinary income from foreign sources at the time it is received or accrued, in accordance with the US Holder's method of accounting for US federal income tax purposes, under the following
rules:

In
the case of a US Holder that is not required to accrue interest income prior to the receipt thereof (for example, an individual US Holder who uses a cash method of accounting), the
amount of interest income in respect of any interest payment will be determined by translating such payment into US dollars at the spot exchange rate in effect on the date such interest payment is
received. No exchange gain or loss will be realized with respect to the receipt of such interest

53

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payment,
other than exchange gain or loss that is attributable to the actual disposition of the euros received.

In
the case of a US Holder that is required to accrue interest income prior to receipt thereof (for example, because the US Holder uses an accrual method of accounting), the amount of
any interest income accrued during any accrual period will generally be determined by translating the accruals into US dollars at the average spot exchange rate applicable to the accrual period. Such
US Holder will additionally realize exchange gain or loss with respect to any interest income accrued on the date such interest income is received (or on the date the senior subordinated note is
disposed of) in an amount equal to the difference between (x) the amount determined by converting the amount of the payment received into US dollars at the spot exchange rate in effect on the
date such payment is received and (y) the amount of interest income accrued in respect of such payment according to the rule set forth in the prior sentence. Notwithstanding the prior two
sentences, a US Holder that is required to accrue interest income prior to receipt thereof may alternatively make an election to apply a "spot accrual convention" that effectively allows the US Holder
to translate accrued interest into US dollars at a single spot exchange rate, as set forth in Treasury regulations section 1.988-2(b)(2)(iii)(B). Exchange gain or loss is treated as
ordinary income or loss for US federal income purposes.



A US Holder that purchased a senior subordinated note for an amount greater than the senior subordinated note's stated principal amount will be considered to have
purchased the senior subordinated note with "amortizable bond premium" equal to the excess of the purchase price over the stated principal amount. Such US Holder may elect to amortize such premium as
an offset to payments of interest on the senior subordinated note, effectively reducing the amount of interest income in the hands of such US Holder.

If
a US Holder makes this election, the US Holder must amortize the premium using a "constant yield method" (i.e., a fixed yield-to-maturity) to determine the
amount of premium that offsets its interest income each year. This results in the amount of deductible premium steadily growing over the term of the senior subordinated note. Because Concordia may
redeem the senior subordinated notes under certain circumstances, an electing US Holder must amortize the premium based on the expected term of the senior subordinated notes assuming that Concordia
will exercise or not exercise its right to redeem senior subordinated notes in a manner that will minimize the yield on the senior subordinated notes. Concordia believes, based on the additional
amounts that it will have to pay in order to redeem senior subordinated notes under different circumstances, as provided for in the indenture dated February 7, 2000 relating to the senior
subordinated notes, that it is significantly more likely than not that the senior subordinated notes will not be redeemed prior to their maturity. Accordingly, an electing US Holder should use the
entire scheduled term of the senior subordinated note as the expected term of the senior subordinated notes for purposes of amortizing the premium. Each time a premium reduces an electing US Holder's
taxable income, the holder must increase its tax basis in the senior subordinated note by the amount of such premium.

A
US Holder makes this election by claiming a deduction (or interest offset) on its US federal income tax return for the acquisition premium for the first taxable year to which the US
Holder
wishes the election to apply, and by attaching a statement to the return to the effect that the holder is making the election under Treasury regulation section 1.171-4. Once made,
the election applies to all taxable debt obligations held by the US Holder during or after the taxable year for which the election is made and may be revoked only with the consent of the US Internal
Revenue Service.

You
should consult your own tax advisors regarding the applicability and effect of the amortizable bond premium rule described above.

54

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Upon the sale, exchange, retirement or other disposition of a senior subordinated note, a US Holder will generally recognize taxable gain or loss equal to the
difference between the amount realized (not including any amounts received that are attributable to accrued and unpaid interest, which will be taxable as ordinary interest income, and exchange gain or
loss as set forth above) and the US Holder's tax basis in the senior subordinated note. A US Holder's tax basis in a senior subordinated note generally will be its cost in U.S. dollars as determined
using the spot rate on the date of aquisition (as adjusted to account for any amortizable bond premium, as set forth above). Gain or loss will be capital gain or loss and will be long-term
capital gain or loss if the senior subordinated note was held from more than one year at the time of the disposition. Gain or loss recognized by a US Holder generally will be treated as US source
income or loss.



US backup withholding and information reporting requirements generally will apply to certain payments to certain non-corporate US Holders of senior
subordinated notes. Information reporting requirements will apply to interest on, and to proceeds from the sale, redemption or other disposition of senior subordinated notes paid to a US Holder (other
than an "exempt recipient," including a corporation and certain other persons who, when required, demonstrate their exempt status). We will be required to backup withhold a portion (currently at a
rate of 30%) of interest on, and the proceeds from the sale, redemption or other disposition of, senior subordinated notes paid within the United States to a US Holder (other than an "exempt
recipient") if such US Holder fails to furnish its correct taxpayer identification number or otherwise fails to comply with applicable backup withholding requirements.

Backup
withholding is not a separate tax. The amount of any backup withholding from a payment to a US Holder will be allowed as a credit against the US Holder's US federal income tax
liability and may entitle the US Holder to a refund, provided that the required information is provided to the US Internal Revenue Service. Prospective purchasers of the senior subordinated notes
should consult their own tax advisors regarding the application of the backup withholding and information reporting requirements.



Recently finalized U.S. Treasury regulations (the "Tax Shelter Regulations") intended to address so called tax shelters and other potentially tax-motivated
transactions require participants in a "reportable transaction" to disclose certain information about the reportable transaction on IRS Form 8886 and retain information relating to the
reportable transaction. Organizers and sellers of a reportable transaction are required to maintain lists identifying the investors participating in the reportable transaction and furnish to the IRS
upon demand such investor information as well as detailed information regarding the reportable transaction. A transaction may be a "reportable transaction" based upon any of several indicia (including
the existence of confidentiality agreements, certain indemnity arrangements, potential for recognizing investment or cover and require reporting of transactions that are generally not considered tax
shelters, including certain foreign currency transactions. Currently, legislative proposals are pending in Congress that, if enacted, would impose significant penalties for failure to comply with
these disclosure requirements. Investors should consult their tax advisors concerning any possible disclosure obligation with respect to their investment in the senior subordinated notes and should be
aware that Concordia intends to comply with the disclosure and list maintenance requirements under the Tax Shelter Regulations as they determine apply to them with respect to any such reportable
transaction.

55

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F.     Dividends and Paying Agents

Not applicable.

G.    Statement by Experts

Not applicable.

H.    Documents on Display

The annual report, its exhibits and schedules, reports and other information that we have filed with or furnished to the Commission may be inspected and copied at
the public reference facilities maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549. You may also contact the Commission at
1-800-SEC-0330 and at its regional offices at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. You can obtain copies
of this material by mail from the Public Reference section of the Commission, 450 Fifth Street, N.W., Washington, D.C., 20549, at prescribed rates.

I.      Subsidiary Information

Not applicable.

Item 11.Quantitative and Qualitative Disclosures About Market Risk

The principal market risks (i.e., the risk of loss arising from adverse changes in market rates and prices) to which we are exposed are:



The
following risk management discussion and the estimated amounts generated from analytical techniques are forward looking statements of the market risk assuming certain market
conditions occur. Our actual results in the future may differ materially from these projected results due to actual developments in the global financial markets.



We manage debt and overall financing strategies centrally using a combination of short and long term loans with either fixed or variable rates. We currently hedge
our exposure to interest rate fluctuations through the use of derivative instruments. Our policy is to ensure that at least 50% of the interest rate payments on 50% on the senior term loans are hedged
for a period of approximately three years. We have entered into Swedish Kronor interest rate swaps and caps to fix a portion of the payments we make under the senior facility. We have also entered
into Euro interest rate swaps and caps to fix a portion of our loans in Euro, for our operations in Finland.

Based
on variable debt levels at February 28, 2003 of SEK 975 million, a 1% change in interest rates would impact net interest expense by approximately SEK
9.7 million per annum, in addition a 1% change in interest rates would increase operating lease charges by approximately SEK 19.2 million per annum. Senior subordinated notes outstanding
at February 28, 2003 with a carrying value of SEK 1.46 billion have been excluded from the above interest rate sensitivity analysis.

56

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We are also exposed to currency fluctuations on our loans, primarily as a result of having to make interest payments in Euro on our senior subordinated notes. We
have entered into collar arrangements through the sale of puts and the purchase of calls with the same settlement dates. While this arrangement caps the amount of benefit we can obtain from an
appreciation of the Swedish Kronor against the Euro, it also caps our potential increased interest costs through a depreciation of the Swedish Kronor against the Euro. Our policy is to hedge at least
50% of our future interest payments on the senior subordinated notes against adverse movements for us in the Swedish Kronor/Euro exchange rate and to hedge 100% of our future payments on the senior
subordinated notes through a cap on positive movements for us in the Swedish Kronor/Euro exchange rate. See the subheading "Liquidity and Capital Resources" in the section "Management's Discussion and
Analysis of Financial Condition and Results of Operations." We estimate that a 10% depreciation in the value of the Swedish Kronor against the Euro would increase our interest costs by approximately
SEK 15.7 million per annum.



Concordia is also exposed to commodity price risk through its requirements for diesel fuel. Diesel fuel is priced in the international commodity markets in US
dollars. We purchase our diesel fuel requirements out of our operating revenue, which is largely denominated in Swedish Kronor. Therefore, we are exposed to currency fluctuation risk between the
dollar and the Swedish Kronor. We currently have hedges in place to purchase portions of our diesel fuel at fixed SEK prices through February 2004. We have achieved this fixed SEK price through
a combination of two hedges. We have a fuel price hedge to purchase diesel fuel at a fixed dollar price and a corresponding currency hedge to fix the SEK rate at which we purchase dollars. We hedge
only the non-tax portion of our diesel fuel costs. We estimate that a $1 increase in the price of diesel would increase our diesel costs by approximately SEK 0.2 million per annum.



Inflation had lesser impact on our operations during the year ended February 28, 2003 than on the year ended February 28, 2002. However, due to the
nature of our contractual business where cost increases are compensated through movements in agreed indices (elements of total inflation) we are subject to under-compensation due to a mismatch between
our industry costs and our relative level of compensation from the indices which the local transportation authorities use to compensate us. A 1% increase in inflation would have a positive benefit of
approximately SEK 9.4 million per annum when compared to the previous year.

Item 12.Description of Securities Other than Equity Securities

Not applicable.

57

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PART II

Item 13.Defaults, Dividend Arrearages and Delinquencies

None.

Item 14.Material Modifications to the Rights of Security Holders and Use of Proceeds

None.

Item 15.Controls and Procedures

As of the end of our fiscal year, we carried out an evaluation, under the supervision and with the participation of our chief executive officer and chief
financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our chief executive officer and chief financial officer have
concluded that our disclosure controls and procedures are effective in timely alerting them to material information required to be included in our periodic reports to the Securities and Exchange
Commission. In addition, we reviewed our internal control over financial reporting and there have been no significant changes in our internal control over financial reporting during the fiscal year
that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Item 16.

[Reserved]

58

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PART III

Item 17.Financial Statements

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS



|                                         |                                                                                            | Page
|---------------------------------------- | ------------------------------------------------------------------------------------------ | ----
|Concordia Bus AB (publ) and subsidiaries |                                                                                            |     
|                                         | Independent auditors' reports                                                              |     
|                                         | Consolidated statements of operations for the years ended February 28, 2003, 2002 and 2001 |     
|                                         | Consolidated balance sheets as of February 28, 2003 and 2002                               |     
|                                         | Consolidated cash flow statements for the years ended February 28, 2003, 2002 and 2001     |     
|                                         | Notes to the consolidated financial statements                                             |     

F-1

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INDEPENDENT AUDITORS' REPORT

To
the Board of Directors and Shareholder of Concordia Bus AB (publ)

We
have audited the accompanying consolidated balance sheet of Concordia Bus AB (publ) and subsidiaries (the "Company") as of February 28, 2003, and the related consolidated
statements of operations and cash flows for the year then ended. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion
on these financial statements based on our audit. The consolidated financial statements of the Company for the years ended February 28, 2002 and 2001, before the adjustments discussed in
Note 1 and the inclusion of the disclosures discussed in Note 33 to the consolidated financial statements, were audited by other auditors who have ceased operations. Those auditors
expressed an unqualified opinion on those financial statements in their report dated June 18, 2002, which included an explanatory paragraph relating to the differences between accounting
principles generally accepted in Sweden and accounting principles generally accepted in the United States of America and the effect that the application of the latter would have on the determination
of net loss and shareholder's equity.

We
conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of 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 audit provides a reasonable basis for our opinion.

In
our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of the Company as of February 28, 2003, and the results of
its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in Sweden.

Accounting
principles generally accepted in Sweden vary in certain significant respects from accounting principles generally accepted in the United States of America. The application of
the latter would have affected the determination of the net loss for the year ended February 28, 2003 and the determination of shareholder's equity and financial position at February 28,
2003 to the extent summarized in Note 33.

As
discussed above, the consolidated financial statements of the Company as of and for the years ended February 28, 2002 and 2001 were audited by other auditors who have ceased
operations. These consolidated financial statements have been revised as follows:



F-2

---



In
our opinion, such adjustments and disclosures are appropriate and have been properly applied. However, we were not engaged to audit, review, or apply any procedures to the 2002 and
2001 consolidated financial statements of the Company other than with respect to such adjustments and disclosures and, accordingly, we do not express an opinion or any form of assurance on the 2002
and 2001 consolidated financial statements taken as a whole.

Deloitte & Touche AB
Stockholm, Sweden
June 25, 2003

F-3

---

This report is a copy of a previously issued Arthur
Andersen AB report originally filed on June 27, 2002
in conjunction with Concordia's Form 20-F for the
year ended February 28, 2002. This report has not
been reissued by Arthur Andersen AB.

REPORT OF INDEPENDENT ACCOUNTANTS

To
the Shareholders of Concordia Bus AB (Publ) (Reg no. 556576-4569)

We
have audited the accompanying balance sheets of Concordia Bus AB (publ) and Subsidiaries (a Swedish limited liability company incorporated in Sweden) as of February 28, 2002
and February 28, 2001, and the related statements of operations and cash flows for the years ended February 28, 2002 and February 28, 2001 and for the 1.5 months ended
February 29, 2000. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We
conducted our audits in accordance with auditing standards generally accepted 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 of 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 financial statements referred to above present fairly, in all material respects, the financial position of Concordia Bus AB and Subsidiaries as of February 28,
2002 and February 28, 2001, and the results of its operations and its and cash flows for the the years ended February 28, 2002 and February 28, 2001 and for the 1.5 months
ended February 29, 2000 in conformity with accounting principles generally accepted in the Sweden.

As
explained in the accounting policies in the notes to the consolidated financial statements, the Company has given retroactive effect to the change in accounting for taxation under the
new Swedish accounting recommendation.

Accounting
principles used by the Company in preparing the accompanying financial statements conform with generally accepted accounting principles in Sweden, but do not conform with
accounting principles generally accepted in the United States. A description of these differences and a revised reconciliation of consolidated net loss, shareholder's equity and cash flow statements
to accounting principles generally accepted in the United States is set forth in Note 31.

Stockholm,
Sweden
June 18, 2002
ARTHUR ANDERSEN AB

/s/THOMAS STRÖMBERG

---

Thomas Strömberg
Authorized Public Accountant
(Sweden)

F-4

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CONCORDIA BUS AB (PUBL) AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(all amounts in millions of SEK, except per share amounts)

|                                    |  | Note |  | March 1, 2002 -
February 28, 2003 |   | March 1, 2001 -
February 28, 2002 |   | March 1, 2000 -
February 28, 2001 |  
|----------------------------------- |  | ---- |  | --------------------------------- | - | --------------------------------- | - | --------------------------------- | -
|
|Net revenue                         |  | 2,4  |  | 4,758                             |   | 4,226                             |   | 3,576                             |  
|Fuel, tires and other consumables   |  | 5    |  | (919                              | ) | (805                              | ) | (691                              | )
|Other external costs                |  | 5,6  |  | (1,006                            | ) | (854                              | ) | (637                              | )
|Personnel costs                     |  | 5,7  |  | (2,597                            | ) | (2,340                            | ) | (1,971                            | )
|Gain (loss) on sale of fixed assets |  |      |  | (4                                | ) | 20                                |   | 65                                |  
|Depreciation and amortization       |  | 5,8  |  | (404                              | ) | (394                              | ) | (364                              | )
|                                    |  |      |  |                                   |   |                                   |   |                                   |  
|Operating loss                      |  | 2    |  | (172                              | ) | (147                              | ) | (22                               | )
|                                    |  |      |  |                                   |   |                                   |   |                                   |  
|Interest income                     |  |      |  | 10                                |   | 5                                 |   | 6                                 |  
|Interest expense and similar items  |  | 22   |  | (265                              | ) | (222                              | ) | (292                              | )
|                                    |  |      |  |                                   |   |                                   |   |                                   |  
|Financial income and expenses       |  |      |  | (255                              | ) | (217                              | ) | (286                              | )
|                                    |  |      |  |                                   |   |                                   |   |                                   |  
|Loss after financial items          |  |      |  | (427                              | ) | (364                              | ) | (308                              | )
|Income tax benefit                  |  | 9    |  | 83                                |   | 78                                |   | 83                                |  
|                                    |  |      |  |                                   |   |                                   |   |                                   |  
|Net loss                            |  |      |  | (344                              | ) | (286                              | ) | (225                              | )
|                                    |  |      |  |                                   |   |                                   |   |                                   |  
|Net loss per share (SEK)            |  | 20   |  | (68,780                           | ) | (57,171                           | ) | (45,035                           | )
|                                    |  |      |  |                                   |   |                                   |   |                                   |  

F-5

---

CONCORDIA BUS AB (PUBL) AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(all amounts in millions of SEK)

|Assets                                    |  | Note |  | February 28, 2003 |  | February 28, 2002
|----------------------------------------- |  | ---- |  | ----------------- |  | -----------------
|
|                                          |  |      |  |                   |  |                  
|Fixed assets                              |  |      |  |                   |  |                  
|Goodwill                                  |  | 10   |  | 765               |  | 809              
|                                          |  |      |  |                   |  |                  
|Total intangible fixed assets             |  |      |  | 765               |  | 809              
|                                          |  |      |  |                   |  |                  
|Buildings and land                        |  | 11   |  | 2                 |  | 1                
|Equipment, tools, fixtures and fittings   |  | 11   |  | 38                |  | 44               
|Vehicles                                  |  | 11   |  | 1,793             |  | 1,971            
|                                          |  |      |  |                   |  |                  
|Total tangible fixed assets               |  |      |  | 1,833             |  | 2,016            
|                                          |  |      |  |                   |  |                  
|Receivables due from affiliated companies |  | 13   |  | 25                |  | 23               
|Other long-term financial fixed assets    |  | 14   |  | 97                |  | 117              
|                                          |  |      |  |                   |  |                  
|Total financial fixed assets              |  |      |  | 122               |  | 140              
|                                          |  |      |  |                   |  |                  
|Total fixed assets                        |  |      |  | 2,720             |  | 2,965            
|                                          |  |      |  |                   |  |                  
|Current assets                            |  |      |  |                   |  |                  
|Inventories                               |  | 15   |  | 35                |  | 31               
|                                          |  |      |  |                   |  |                  
|Accounts receivables                      |  | 16   |  | 334               |  | 343              
|Other current receivables                 |  |      |  | 37                |  | 26               
|Accrued income and prepaid expenses       |  | 17   |  | 178               |  | 157              
|                                          |  |      |  |                   |  |                  
|Total receivables                         |  |      |  | 549               |  | 526              
|                                          |  |      |  |                   |  |                  
|Cash and bank balances                    |  | 18   |  | 199               |  | 422              
|                                          |  |      |  |                   |  |                  
|Total current assets                      |  |      |  | 783               |  | 979              
|                                          |  |      |  |                   |  |                  
|TOTAL ASSETS                              |  | 3    |  | 3,503             |  | 3,944            
|                                          |  |      |  |                   |  |                  

F-6

---

CONCORDIA BUS AB (PUBL) AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(all amounts in millions of SEK, except share and per share amounts)

|SHAREHOLDER'S EQUITY AND LIABILITIES              |  | Note |  | February 28, 2003 |   | February 28, 2002 |  
|------------------------------------------------- |  | ---- |  | ----------------- | - | ----------------- | -
|
|                                                  |  |      |  |                   |   |                   |  
|Shareholder's equity                              |  | 19   |  |                   |   |                   |  
|Restricted equity                                 |  |      |  |                   |   |                   |  
|Share capital (5,000 shares at par value SEK 100) |  |      |  | 1                 |   | 1                 |  
|Restricted reserves                               |  |      |  | 27                |   | 0                 |  
|                                                  |  |      |  |                   |   |                   |  
|Total restricted equity                           |  |      |  | 28                |   | 1                 |  
|                                                  |  |      |  |                   |   |                   |  
|Non-restricted equity                             |  |      |  |                   |   |                   |  
|Retained earnings                                 |  |      |  | 394               |   | 707               |  
|Net loss for the year                             |  | 20   |  | (344              | ) | (286              | )
|                                                  |  |      |  |                   |   |                   |  
|Total non-restricted equity                       |  |      |  | 50                |   | 421               |  
|                                                  |  |      |  |                   |   |                   |  
|Total shareholder's equity                        |  |      |  | 78                |   | 422               |  
|                                                  |  |      |  |                   |   |                   |  
|Liabilities                                       |  |      |  |                   |   |                   |  
|Provisions                                        |  |      |  |                   |   |                   |  
|Provisions for pensions and similar commitments   |  | 21   |  | 69                |   | 68                |  
|Other provisions                                  |  | 29   |  | 46                |   | 31                |  
|Deferred income tax liability                     |  | 9    |  | 56                |   | 137               |  
|                                                  |  |      |  |                   |   |                   |  
|Total provisions                                  |  |      |  | 171               |   | 236               |  
|                                                  |  |      |  |                   |   |                   |  
|Non-current liabilities                           |  |      |  |                   |   |                   |  
|Liabilities to credit institutions                |  | 22   |  | 837               |   | 1,021             |  
|Loans due to affiliated companies                 |  |      |  |                  |   | 5                 |  
|Other long-term debt                              |  | 22   |  | 1,481             |   | 1,454             |  
|                                                  |  |      |  |                   |   |                   |  
|Total non-current liabilities                     |  |      |  | 2,318             |   | 2,480             |  
|                                                  |  |      |  |                   |   |                   |  
|Current liabilities                               |  |      |  |                   |   |                   |  
|Short-term portion of long-term liabilities       |  | 22   |  | 145               |   | 39                |  
|Accounts payable                                  |  |      |  | 244               |   | 163               |  
|Income tax liabilities                            |  |      |  |                  |   | 1                 |  
|Other current liabilities                         |  | 23   |  | 104               |   | 179               |  
|Accrued expenses and deferred income              |  | 24   |  | 443               |   | 424               |  
|                                                  |  |      |  |                   |   |                   |  
|Total current liabilities                         |  |      |  | 936               |   | 806               |  
|                                                  |  |      |  |                   |   |                   |  
|TOTAL SHAREHOLDER'S EQUITY AND LIABILTIES         |  |      |  | 3,503             |   | 3,944             |  
|                                                  |  |      |  |                   |   |                   |  
|PLEDGED ASSETS AND CONTINGENT LIABILITIES         |  |      |  |                   |   |                   |  
|Pledged assets                                    |  | 26   |  | 2,847             |   | 3,400             |  
|Contingent liabilities                            |  | 26   |  | 693               |   | 649               |  
|                                                  |  |      |  |                   |   |                   |  
|TOTAL PLEDGED ASSETS AND CONTINGENT LIABILITIES   |  |      |  | 3,540             |   | 4,049             |  
|                                                  |  |      |  |                   |   |                   |  

F-7

---

CONCORDIA BUS AB (PUBL) AND SUBSIDIARIES

CONSOLIDATED CASH FLOW STATEMENTS

(all amounts in millions of SEK)

|                                                                  |  | March 1, 2002 -
February 28, 2003 |   | March 1, 2001 -
February 28, 2002 |   | March 1, 2000 -
February 28, 2001 |  
|----------------------------------------------------------------- |  | --------------------------------- | - | --------------------------------- | - | --------------------------------- | -
|
|Cash flows from operating activities                              |  |                                   |   |                                   |   |                                   |  
|Loss after financial items                                        |  | (427                              | ) | (364                              | ) | (308                              | )
|Depreciation and amortization                                     |  | 404                               |   | 394                               |   | 364                               |  
|Loss (gain) on sale of tangible fixed assets                      |  | 4                                 |   | (20                               | ) | (65                               | )
|Change in provision for restructuring                             |  |                                  |   |                                  |   | (20                               | )
|Change in provision for loss-making contracts                     |  | 15                                |   | 4                                 |   | (18                               | )
|Change in pension provision                                       |  | 1                                 |   | (14                               | ) | (2                                | )
|Change in provision for merger                                    |  |                                  |   |                                  |   | (10                               | )
|Change in interest receivables                                    |  | 3                                 |   | (4                                | ) | (1                                | )
|Change in interest payables                                       |  | 27                                |   | (8                                | ) | 93                                |  
|Income taxes received (paid)                                      |  | 2                                 |   | (3                                | ) | (4                                | )
|Change in working capital                                         |  |                                   |   |                                   |   |                                   |  
|(Increase) decrease in inventory                                  |  | (4                                | ) | (6                                | ) | (5                                | )
|(Increase) decrease in current receivables                        |  | (16                               | ) | 68                                |   | (46                               | )
|Increase (decrease) in current liabilities                        |  | 2                                 |   | 48                                |   | (50                               | )
|                                                                  |  |                                   |   |                                   |   |                                   |  
|Net cash flows provided by (used in) operating activities         |  | 11                                |   | 95                                |   | (72                               | )
|                                                                  |  |                                   |   |                                   |   |                                   |  
|Cash flows from investing activities                              |  |                                   |   |                                   |   |                                   |  
|Investments in land, buildings, vehicles, machinery and equipment |  | (216                              | ) | (43                               | ) | (336                              | )
|Sales of land, buildings, vehicles, machinery and equipment       |  | 75                                |   | 222                               |   | 399                               |  
|Sale of financial fixed assets                                    |  | 5                                 |   | 96                                |   |                                  |  
|Proceeds from pension refund                                      |  |                                  |   |                                  |   | 48                                |  
|Borrowings repaid to affiliated companies                         |  |                                  |   |                                  |   | (8                                | )
|                                                                  |  |                                   |   |                                   |   |                                   |  
|Net cash flows provided by (used in) investing activities         |  | (136                              | ) | 275                               |   | 103                               |  
|                                                                  |  |                                   |   |                                   |   |                                   |  
|Cash flows from financing activities                              |  |                                   |   |                                   |   |                                   |  
|Shareholder's contribution                                        |  |                                  |   |                                  |   | 61                                |  
|Payment of finance lease obligation                               |  | (9                                | ) |                                  |   |                                  |  
|Proceeds from borrowings                                          |  |                                  |   | 548                               |   | 9                                 |  
|Repayment of long-term debt                                       |  | (86                               | ) | (716                              | ) | (17                               | )
|Refinancing costs                                                 |  |                                  |   | (26                               | ) |                                  |  
|                                                                  |  |                                   |   |                                   |   |                                   |  
|Net cash flows provided by (used in) financing activities         |  | (95                               | ) | (194                              | ) | 53                                |  
|                                                                  |  |                                   |   |                                   |   |                                   |  
|NET INCREASE (DECREASE) IN CASH AND BANK BALANCES                 |  | (220                              | ) | 176                               |   | 84                                |  
|CASH AND BANK BALANCES AT THE BEGINNING OF THE YEAR               |  | 422                               |   | 241                               |   | 151                               |  
|Translation difference                                            |  | (3                                | ) | 5                                 |   | 6                                 |  
|                                                                  |  |                                   |   |                                   |   |                                   |  
|CASH AND BANK BALANCES AT THE END OF THE YEAR                     |  | 199                               |   | 422                               |   | 241                               |  
|                                                                  |  |                                   |   |                                   |   |                                   |  

F-8

---



CONCORDIA BUS AB (PUBL) AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(all amounts in millions of SEK unless otherwise stated)

Organization

Concordia Bus AB (publ) and its subsidiaries ("Concordia Bus Group" or "Concordia") is a Swedish registered limited liability company, wholly owned by Concordia
Bus Holding AB (reg no 556574-8240) with its registered office in Stockholm, Sweden. The final operational parent company of the Concordia Bus Group is Concordia Bus BV.

The
primary operations of Concordia Bus consist of providing regular bus services under contract through its primary subsidiary Concordia Bus Nordic AB, to transit authorities in Sweden,
Norway and Finland. In addition to contracted services, Concordia also supplies extensive express bus services over major portions of Sweden, as well as charter and tour bus services, mainly in
Stockholm, Gothenburg and Malmö.

Note 1. Accounting principles

General

The consolidated financial statements of the Concordia Bus Group have been prepared in accordance with accounting principles generally accepted in Sweden
("Swedish GAAP") and, thus,
have been prepared in accordance with the recommendations of the Swedish Financial Accounting Standards Council ("Redovisningrådet" or "RR") concerning consolidated financial
statements. The Concordia Bus Group is required to reconcile its financial statements to accounting principles generally accepted in the United States of America ("U.S. GAAP") since the Concordia Bus
Group is listed on NASDAQ in the U.S. Significant differences between Swedish GAAP and U.S. GAAP are described in Note 33.

Accounting Changes

During the year ended February 28, 2003, Concordia adopted RR 16,Provisions and Contingent Liabilities,for Swedish GAAP. RR 16 is required to be adopted retroactively. Under RR 16, provisions for loss making contracts have been made on an individual basis for the contracts where contractual revenues do
not cover the estimated costs without regard to other profitable contracts. Previously, the loss making contracts were valued under a portfolio method where losses in some contracts were offset by
profits in other contracts which resulted in no provision being recorded for Swedish GAAP purposes. This change in accounting policy for Swedish GAAP did not have any impact on the amounts reported
for U.S. GAAP.

As
required by Swedish GAAP, the accounting change has been made retroactively through a restatement of the historical financial statements to the earliest period presented. The impact
of the

F-9

---

change
in accounting policy, which has been reflected in the historical financial statements, was as follows (in millions of SEK, except net loss per share):

|                                     |  | March 1, 2001 -
February 28, 2002 |   | March 1, 2000 -
February 28, 2001 |   
|------------------------------------ |  | --------------------------------- | - | --------------------------------- | --
|
|Consolidated Statement of Operations |  |                                   |   |                                   |   
|Other external costs                 |  | (850                              | ) | (854                              | ) 
|Operating loss                       |  | (143                              | ) | (147                              | ) 
|Loss after financial items           |  | (360                              | ) | (364                              | ) 
|Income tax benefit                   |  | 77                                |   | 78                                |   
|Net loss                             |  | (283                              | ) | (286                              | ) 
|Net loss per share (SEK)             |  | (56,571                           | ) | (57,171                           | ))

|                              |  | February 28, 2002 |  
|----------------------------- |  | ----------------- | -
|
|Consolidated Balance Sheets   |  |                   |  
|Retained earnings             |  | 726               |  
|Net loss for the year         |  | (283              | )
|Total non-restricted equity   |  | 443               |  
|Total shareholder's equity    |  | 444               |  
|Other provisions              |  |                  |  
|Deferred income tax liability |  | 146               |  
|Total provisions              |  | 214               |  

The
effect of the change in accounting policy on total shareholder's equity at March 1, 2000 appears in Note 19.

Currency

These financial statements have been prepared in SEK. References to "SEK", "Swedish krona" or "Swedish kronor" are to Swedish currency.

Consolidated Financial Statements

The consolidated Statements of Operations, Balance Sheets, and Cash Flows of Concordia Bus Group include all companies in which the parent company, directly or
indirectly, holds more than 50 percent of the voting rights.

Acquisitions
have been accounted for using the purchase method. This means that the assets and liabilities, including deferred taxes, of acquired subsidiaries are recorded at fair value
at the date of the acquisition. If the purchase price exceeds the estimated fair value of the company's net assets, the difference is reported as goodwill, which is amortized over its estimated useful
life, not to exceed twenty years. Income from companies acquired during the year is included in the

F-10

---

consolidated
financial statements from the date of acquisition. Net income from companies sold is included up to the date of the sale.

Internal
profits and inter-company transactions within the Concordia Bus Group are eliminated in the consolidated financial statements.

Translation of investments in foreign subsidiaries

Concordia uses the current rate method to translate the financial statements of foreign subsidiaries, in accordance with the suggested recommendations of the
Swedish Financial Accounting Council ("Redovisningrõdet"). In applying this method, subsidiaries are reported as independent units with operations conducted in foreign currencies and in
which Concordia has a net investment. This means that the assets and liabilities of the foreign subsidiaries are translated at the exchange rate as of the balance sheet date. Shareholder's equity is
translated at historic rates. The Statements of Operations are translated at the average rate for the year. Exchange rate differences arising on foreign currency denominated loans used to finance
investments in foreign subsidiaries are reversed against unrestricted equity to the extent it corresponds to profits or losses recognized on the conversion of such equity and after considering the tax
effects.

Revenue recognition

The majority of Concordia's revenues arise from contracts with local public transportation authorities having contract terms of up to 6 years ("CPTA
contracts"). CPTA contracts generally provide Concordia with fixed fee revenue in return for the contracted bus services. Such fixed fees are generally subject to periodic adjustment for certain
changes in costs incurred or cost indices. Accordingly, all ticket revenues collected by Concordia on such contracts, referred to as gross agreements, are forwarded to the local public transportation
authorities, and Concordia receives its fixed fees regardless of the number of passengers transported. Revenues earned by Concordia on certain other CPTA contracts, referred to as net agreements, are
based on or consider the number of passengers transported. Revenues from express bus services are derived from passenger ticket revenue received, and revenues from coach hire services are derived from
the agreed price for hire of the buses. Concordia recognizes CPTA revenue, express bus service revenue, and coach hire service revenue as services are provided. Where appropriate, revenue amounts are
shown net of rebates and VAT.

Revenue
also comprises other operating income such as rental, sale of fuel and diesel and from engineering services. The revenue resulting from other operating activities are recognized
when the product is delivered or the service is performed.

Income Taxes

The total income tax expense of the Concordia Bus Group consists of current and deferred income taxes. Deferred income tax primarily consists of estimated tax on
changes in untaxed reserves for the year and the unused portions of income tax loss carryforwards to the extent that these losses can be used in the future as a reduction of future taxable income. The
deferred income tax position is calculated using the enacted tax rate for each country respectively.

F-11

---

Depreciation and amortization

Annual depreciation and amortization is computed using a straight-line method based on the following percentages:

|Goodwill                                |  | 5-20%    
|--------------------------------------- |  | ---------
|Equipment, tools, fixtures and fittings |  | 10-33%   
|Public Service Vehicles ("PSV")         |  | 7.15%-20%
|Buildings                               |  | 3.33-5%  
|Land improvements                       |  | 3.75-5%  

Goodwill
pertaining to both the acquisitions of Concordia Bus Nordic AB and Ingeniør M.O. Schøyens Bilcentraler A/S is amortized over a period of 20 years
which is based on the companies' strong strategic position in their marketplaces, their well established brands and the long-term historical profitability that the acquired companies have
been able to generate.

Tangible fixed assets

Tangible fixed assets are valued at cost, less accumulated depreciation and impairment charges.

Impairment of tangible and intangible fixed assets

Impairment reviews of tangible and intangible fixed assets, including goodwill, are performed whenever there is an indication of possible impairment. The carrying
values of fixed assets, including goodwill related to those assets, are not considered to be recoverable when the expected discounted cash flows from those assets are less than their carrying values.
An impairment loss is determined based on the amount by which the carrying value exceeds the fair value of those assets. Losses on fixed assets to be disposed of are determined in a similar manner,
taking into account the selling price reduced by the costs of disposal.

Receivables and payables

Receivables and payables are booked on an individual basis at the amount which is estimated to be receivable or payable.

Receivables and payables in foreign currencies

Receivables and payables in foreign currencies are valued using the rate as of the balance sheet date. Gains and losses on trade receivables and payables included
in the operating loss. Gains and losses related to other receivables and payables are reported under financial income and expense.

Inventories

Inventories are valued at the lower of cost, using the first in first out method, or market value after provision for obsolescence.

F-12

---

Leasing

Leases are classified in the consolidated financial statements as either finance leases or operating leases. A finance lease transfers to the lessee the
significant economic risks and rewards of ownership. If this is not the case, the lease is an operating lease. For each finance lease, a fixed asset is reported in the balance sheet and a
corresponding lease obligation is recorded as a liability. In the statement of operations, the costs of finance leases are reported as depreciation of the carrying value of the fixed asses and
interest expense on the lease obligation. For operating leases, no asset or liability is recorded in the balance sheet. In the statement of operations, the periodic rental payments for operating
leases are expensed on a straight-line basis.

Loss making contracts

A significant portion of Concordia's revenues are derived from 4-6 year contracts with municipalities to provide bus services in a particular
area. Under the terms of the contracts, the revenues are generally indexed at a rate corresponding to a consumer price index or a net price index. Due to changes in circumstances and because costs
have generally increased more quickly than revenues, such contracts may become loss making. Concordia records a provision for such loss making contracts at the lowest level for which there are
separate identifiable cash independent cash flows. Losses are recognized in the period in which management determines that cumulative losses will be incurred on a particular contract. The loss is
computed after taking into account direct costs related to the service provided under the contract including depreciation on the related buses which will be used to meet the service obligation.

Provisions
for loss making contracts have been made on an individual basis for the contracts where contractual revenues do not cover the estimated costs without regard to other
profitable contracts. As discussed earlier in this Note 1, the loss making contracts were previously valued under a portfolio method where losses in some contracts were offset by profits in
other contracts which resulted in no provision being recorded for Swedish GAAP purposes.

Retirement indemnities

Various insurance companies manage Concordia Bus Group's pension plans. In all of these plans, the pension liability corresponds to the pension obligation as
determined by actuarial calculations. Pension plans for active personnel are funded under a multiemployer plan and through defined contribution plans.

Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities to the date of the financial statements and the reported amounts of revenues and expense
during the reporting period. Actual results could differ from those estimates.

F-13

---

Segment information

Concordia Bus Group operates through its subsidiary Concordia Bus Nordic AB within three bus transportation markets: CPTA, scheduled intercity bus services
(express bus services); and coach hire services. In Norway and Finland the group operates within the CPTA segment only.

The
CPTA segment operates throughout Sweden and in the major urban areas in Norway and Finland. The majority of revenues are generated from contractual agreements with municipalities.
Swebus Express, the express bus services segment, conducts its business on certain routes all over Sweden. Interbus, the coach hire services segment, operates hire and excursion engagements, primarily
in the three major cities in Sweden which include Stockholm, Gothenburg and Malmö, together with other engagements to Nordic capital cities and excursions all over Scandinavia.

The
management and reporting of results of Concordia Bus Group's operations is based upon the reportable segments rather than the legal structure. Concordia Bus Group's operating
decision-making group is the Board of Directors. Each segment is managed separately because each business requires specialized industry knowledge and strategies.

The
accounting policies for the reportable segments are the same as those used in the consolidated financial statements.

Concordia
evaluates performance based upon the operating income (loss) before income tax of each reportable segment and generally accounts for inter-segment sales and transfers as if the
sales or transfers were to third parties at current market prices. Sales are attributed to geographical areas based on the location of the assets producing the revenue.

New accounting principles to be adopted in future years

In 2004, the following recommendations, issued by the Swedish Financial Accounting Standards Council, become effective: Inventory (RR 2:02), Presentation of
Financial Statements (RR 22), Investment Properties (RR 24), Segment Reporting (RR 25), Events after the Balance Sheet Date (RR 26), Financial Instruments: Disclosure and Presentations (RR 27), and
Accounting for Government Grants (RR 28). In 2005, Employee Benefits (RR 29) becomes effective. Concordia has not completed its assessment of the impact of implementing the new recommendations.

F-14

---

Note 2. Net revenue and operating profit (loss) by segment

Net revenues by segment were as follows:

|Revenue by segment                                                |  | March 1, 2002 -
February 28, 2003 |   | March 1, 2001 -
February 28, 2002 |   | March 1, 2000 -
February 28, 2001 |  
|----------------------------------------------------------------- |  | --------------------------------- | - | --------------------------------- | - | --------------------------------- | -
|CPTASweden                                                       |  | 3,439                             |   | 2,929                             |   | 2,841                             |  
|Elimination of sales within CPTA                                  |  |                                  |   |                                  |   | (34                               | )
|Elimination of sales to Express from CPTA                         |  | (32                               | ) | (70                               | ) | (75                               | )
|Rent, external engineering and diesel revenues within CPTA Sweden |  |                                  |   | (27                               | ) | (19                               | )
|                                                                  |  |                                   |   |                                   |   |                                   |  
|Total CPTASweden                                                 |  | 3,407                             |   | 2,832                             |   | 2,713                             |  
|CPTANorway                                                       |  | 442                               |   | 508                               |   | 41                                |  
|CPTAFinland                                                      |  | 394                               |   | 374                               |   | 338                               |  
|                                                                  |  |                                   |   |                                   |   |                                   |  
|Total CPTA                                                        |  | 4,243                             |   | 3,714                             |   | 3,092                             |  
|Expressexpress bus services                                      |  | 295                               |   | 299                               |   | 260                               |  
|Interbuscoach hire services                                      |  | 144                               |   | 161                               |   | 158                               |  
|Elimination of sales to Express from Interbus                     |  | (17                               | ) | (18                               | ) | (18                               | )
|                                                                  |  |                                   |   |                                   |   |                                   |  
|Total bus operations                                              |  | 4,665                             |   | 4,156                             |   | 3,492                             |  
|Other revenue and group eliminations                              |  | 93                                |   | 70                                |   | 84                                |  
|                                                                  |  |                                   |   |                                   |   |                                   |  
|Total net revenue                                                 |  | 4,758                             |   | 4,226                             |   | 3,576                             |  
|                                                                  |  |                                   |   |                                   |   |                                   |  

Operating
income (loss) by segment, before overhead allocation, was as follows:

|Operating income (loss) by segment  |  | March 1, 2002 -
February 28, 2003 |   | March 1, 2001 -
February 28, 2002 |   | March 1, 2000 -
February 28, 2001 |  
|----------------------------------- |  | --------------------------------- | - | --------------------------------- | - | --------------------------------- | -
|CPTASweden*                        |  | (27                               | ) | (6                                | ) | 10                                |  
|CPTANorway**                       |  | (23                               | ) | (14                               | ) | (1                                | )
|CPTAFinland                        |  | (23                               | ) | (22                               | ) | (20                               | )
|                                    |  |                                   |   |                                   |   |                                   |  
|Total CPTA                          |  | (73                               | ) | (42                               | ) | (11                               | )
|                                    |  |                                   |   |                                   |   |                                   |  
|Expressexpress bus services        |  | 25                                |   | 21                                |   | 20                                |  
|Interbuscoach hire services        |  | 5                                 |   | 10                                |   | 18                                |  
|                                    |  |                                   |   |                                   |   |                                   |  
|Total Express and Interbus          |  | 30                                |   | 31                                |   | 38                                |  
|                                    |  |                                   |   |                                   |   |                                   |  
|Total bus operations                |  | (43                               | ) | (11                               | ) | 27                                |  
|Gain (loss) on sale of fixed assets |  | (4                                | ) | 20                                |   | 65                                |  
|Goodwill amortization               |  | (44                               | ) | (45                               | ) | (34                               | )
|Head office items and others        |  | (81                               | ) | (111                              | ) | (80                               | )
|                                    |  |                                   |   |                                   |   |                                   |  
|Total operating loss                |  | (172                              | ) | (147                              | ) | (22                               | )
|                                    |  |                                   |   |                                   |   |                                   |  

---

F-15

---



Note 3. Assets by segment and total assets

|Assets                                    |  | February 28, 2003 |  | February 28, 2002
|----------------------------------------- |  | ----------------- |  | -----------------
|CPTASweden                               |  | 2,073             |  | 2,080            
|CPTANorway                               |  | 118               |  | 171              
|CPTAFinland                              |  | 260               |  | 295              
|                                          |  |                   |  |                  
|Total CPTA                                |  | 2,451             |  | 2,546            
|                                          |  |                   |  |                  
|Express                                   |  | 151               |  | 146              
|Interbus                                  |  | 86                |  | 110              
|                                          |  |                   |  |                  
|Subtotal Express and Interbus             |  | 256               |  | 256              
|                                          |  |                   |  |                  
|Total bus operations                      |  | 2,688             |  | 2,802            
|Corporate assets:                         |  |                   |  |                  
|Goodwill                                  |  | 765               |  | 848              
|Real estate                               |  | 2                 |  | 1                
|Other                                     |  |                  |  | 33               
|Head office assets and group eliminations |  | 48                |  | 260              
|                                          |  |                   |  |                  
|Total assets                              |  | 3,503             |  | 3,944            
|                                          |  |                   |  |                  

Note 4. Net revenue

Net revenue includes not only revenues from regular bus services, but also other sources of operating income primarily relating to rental income, sale of fuel and
diesel and revenues from engineering services provided to external customers.

The
categories and amounts of net revenue were as follows:

|Categories of net revenue                                         |  | March 1, 2002 -
February 28, 2003 |  | March 1, 2001 -
February 28, 2002 |  | March 1, 2000 -
February 28, 2001
|----------------------------------------------------------------- |  | --------------------------------- |  | --------------------------------- |  | ---------------------------------
|Revenue from regular bus services                                 |  | 4,665                             |  | 4,138                             |  | 3,491                            
|Rent, external engineering and diesel revenues within CPTA Sweden |  | 40                                |  | 58                                |  | 76                               
|Other revenues                                                    |  | 53                                |  | 30                                |  | 9                                
|                                                                  |  |                                   |  |                                   |  |                                  
|Total net revenue                                                 |  | 4,758                             |  | 4,226                             |  | 3,576                            
|                                                                  |  |                                   |  |                                   |  |                                  

F-16

---

Note 5. Cost of services provided

Cost of services provided comprises drivers' costs, depreciation of PSV and other direct costs as follows:

|                                                         |  | March 1, 2002 -
February 28, 2003 |  | March 1, 2001 -
February 28, 2002 |  | March 1, 2000 -
February 28, 2001
|-------------------------------------------------------- |  | --------------------------------- |  | --------------------------------- |  | ---------------------------------
|Drivers' costs                                           |  | 2,265                             |  | 1,942                             |  | 1,676                            
|Depreciation of PSV and operating lease rentals on buses |  | 676                               |  | 536                               |  | 349                              
|Other direct costs                                       |  | 1,165                             |  | 1,098                             |  | 1,045                            
|                                                         |  |                                   |  |                                   |  |                                  
|Total cost of services provided                          |  | 4,106                             |  | 3,576                             |  | 3,070                            
|                                                         |  |                                   |  |                                   |  |                                  

Note 6. Other external costs

Included in other external costs were the following amounts paid to auditors:

|Fees paid to auditors |  | March 1, 2002 -
February 28, 2003 |  | March 1, 2001 -
February 28, 2002 |  | March 1, 2000 -
February 28, 2001
|--------------------- |  | --------------------------------- |  | --------------------------------- |  | ---------------------------------
|Deloitte & Touche AB  |  |                                   |  |                                   |  |                                  
|Audit fees            |  | 4                                 |  |                                  |  |                                 
|Other services        |  |                                  |  |                                  |  |                                 
|Arthur Andersen AB    |  |                                   |  |                                   |  |                                  
|Audit fees            |  |                                  |  | 3                                 |  | 2                                
|Other services        |  |                                  |  | 2                                 |  | 0                                
|                      |  |                                   |  |                                   |  |                                  
|Total                 |  | 4                                 |  | 5                                 |  | 2                                
|                      |  |                                   |  |                                   |  |                                  

Audit
fees represent fee paid relating to the audit of the financial statements and the review of quarterly reports. The audit fees also represents fees in conjunction with the auditor's
consideration of significant decisions, actions taken and circumstances of Concordia in order to be able to determine the possible liability to Concordia of any Board Member or the Managing Director
or whether they have in some other way acted in contravention of the Swedish Companies Act, the Annual Accounts Act or the Articles of Association. All other services provided are included in "other
services".

Also
included in other external costs were the following items and amounts:

|                               |  | March 1, 2002 -
February 28, 2003 |  | March 1, 2001 -
February 28, 2002 |  | March 1, 2000 -
February 28, 2001
|------------------------------ |  | --------------------------------- |  | --------------------------------- |  | ---------------------------------
|Operating lease rental expense |  | 350                               |  | 230                               |  | 48                               
|Restructuring costs            |  |                                  |  | 17                                |  |                                 

Concordia
has 1,156 buses under operating lease contracts at February 28, 2003. Concordia also has nine properties under operating lease contracts in which it conducts business.
The net present value of future leasing payments as of February 28, 2003 amounts to SEK 945 million for buses and SEK 58 million for properties. See Note 25 for more
details.

F-17

---

Note 7. Personnel costs and other related information

|                                                              |  | March 1, 2002 -
February 28, 2003 |  | March 1, 2001 -
February 28, 2002 |  | March 1, 2000 -
February 28, 2001
|------------------------------------------------------------- |  | --------------------------------- |  | --------------------------------- |  | ---------------------------------
|AVERAGE NUMBER OF EMPLOYEES:                                  |  |                                   |  |                                   |  |                                  
|Total company of which:                                       |  | 7,484                             |  | 6,924                             |  | 6,696                            
|Men                                                           |  | 6,603                             |  | 6,055                             |  | 5,895                            
|Women                                                         |  | 881                               |  | 869                               |  | 801                              
|                                                              |  |                                   |  |                                   |  |                                  
|Finland of which:                                             |  | 759                               |  | 745                               |  | 703                              
|Men                                                           |  | 722                               |  | 704                               |  | 672                              
|Women                                                         |  | 37                                |  | 41                                |  | 31                               
|Norway of which:                                              |  | 775                               |  | 795                               |  | 721                              
|Men                                                           |  | 728                               |  | 732                               |  | 691                              
|Women                                                         |  | 47                                |  | 63                                |  | 30                               
|Sweden of which:                                              |  | 5,950                             |  | 5,384                             |  | 5,272                            
|Men                                                           |  | 5,153                             |  | 4,619                             |  | 4,532                            
|Women                                                         |  | 797                               |  | 765                               |  | 740                              
|                                                              |  |                                   |  |                                   |  |                                  
|SALARIES AND OTHER REMUNERATIONS:                             |  |                                   |  |                                   |  |                                  
|Board of Directors and President                              |  | 4                                 |  | 2                                 |  | 1                                
|Other employees in Sweden                                     |  | 1,454                             |  | 1,254                             |  | 1,220                            
|                                                              |  |                                   |  |                                   |  |                                  
|Total Sweden                                                  |  | 1,458                             |  | 1,256                             |  | 1,221                            
|Subsidiaries abroad                                           |  |                                   |  |                                   |  |                                  
|FinlandBoard of Directors and President                      |  | 1                                 |  | 1                                 |  |                                 
|FinlandOther employees                                       |  | 195                               |  | 225                               |  | 163                              
|NorwayBoard of Directors and President                       |  | 1                                 |  | 1                                 |  |                                 
|NorwayOther employees                                        |  | 204                               |  | 251                               |  | 20                               
|                                                              |  |                                   |  |                                   |  |                                  
|TOTAL                                                         |  | 2,300                             |  | 1,734                             |  | 1,404                            
|                                                              |  |                                   |  |                                   |  |                                  
|Employer's contribution for national social security purposes |  | 700                               |  | 538                               |  | 536                              
|Of which pension costs                                        |  | 137                               |  | 72                                |  | 109                              

Other information regarding personnel

Compensation for the Managing Director of Concordia Bus AB is paid by Concordia Bus Management A/S and is invoiced to Concordia Bus AB.

F-18

---

Note 8. Depreciation and amortization expense

|                                        |  | March 1, 2002 -
February 28, 2003 |  | March 1, 2001 -
February 28, 2002 |  | March 1, 2000 -
February 28, 2001
|--------------------------------------- |  | --------------------------------- |  | --------------------------------- |  | ---------------------------------
|Goodwill                                |  | 44                                |  | 45                                |  | 34                               
|Buildings and land                      |  |                                  |  | 5                                 |  | 9                                
|Equipment, tools, fixtures and fittings |  | 23                                |  | 28                                |  | 20                               
|Vehicles                                |  | 337                               |  | 316                               |  | 301                              
|                                        |  |                                   |  |                                   |  |                                  
|Total                                   |  | 404                               |  | 394                               |  | 364                              
|                                        |  |                                   |  |                                   |  |                                  

Note 9. Income taxes

|                            |  | March 1, 2002 -
February 28, 2003 |  | March 1, 2001 -
February 28, 2002 |  | March 1, 2000 -
February 28, 2001
|--------------------------- |  | --------------------------------- |  | --------------------------------- |  | ---------------------------------
|Taxes refunded              |  | 2                                 |  | 6                                 |  |                                 
|Deferred income tax benefit |  | 81                                |  | 72                                |  | 83                               
|                            |  |                                   |  |                                   |  |                                  
|Total income tax benefit    |  | 83                                |  | 78                                |  | 83                               
|                            |  |                                   |  |                                   |  |                                  

|                                        |  | March 1, 2002 -
February 28, 2003 |    | March 1, 2001 -
February 28, 2002 |    | March 1, 2000 -
February 28, 2001 |   
|--------------------------------------- |  | --------------------------------- | -- | --------------------------------- | -- | --------------------------------- | --
|Income tax at Swedish statutory rate    |  | 28                                | %  | 28                                | %  | 28                                | % 
|Nondeductible goodwill amortization     |  | (3                                | %) | (3                                | %) | (3                                | %)
|Change in valuation allowance regarding |  |                                   |    |                                   |    |                                   |   
|income tax loss carryforwards           |  | (6                                | %) | (4                                | %) |                                  |   
|Income tax on untaxed reserves          |  |                                  |    |                                  |    | 2                                 | % 
|                                        |  |                                   |    |                                   |    |                                   |   
|Effective income tax rate               |  | 19                                | %  | 21                                | %  | 27                                | % 
|                                        |  |                                   |    |                                   |    |                                   |   

The
Swedish, Norwegian and Finnish corporate income tax rate is 28%. The income tax expense or benefit is estimated on the basis of the net income (loss) reported, plus
non-deductible expenses and other tax adjustments.

F-19

---

The
components of the deferred income tax assets and liabilities were as follows:

|                                                          |                              | February 28, 2003 |     | February 28, 2002 |    
|--------------------------------------------------------- | ---------------------------- | ----------------- | --- | ----------------- | ---
|Deferred income tax liabilities:                          |                              |                   |     |                   |    
|                                                          | Excess of tax depreciation   |                   | 96  |                   | 168
|                                                          | Other                        |                   | 2   |                   | 11 
|Deferred income tax assets:                               |                              |                   |     |                   |    
|                                                          | Income tax loss carryforward |                   | (50 | )                 | (43
|                                                          | Provision for loss contracts |                   | (13 | )                 | (9 
|                                                          | Other                        |                   | (1  | )                 |   
|Valuation allowance against income tax loss carryforwards |                              | 22                |     | 10                |    
|                                                          |                              |                   |     |                   |    
|Total deferred income tax liability                       |                              | 56                |     | 137               |    
|                                                          |                              |                   |     |                   |    

All
deferred income tax liabilities are non-current. Concordia has unutilized income tax loss carryforwards totalling SEK 178 million at February 28, 2003. Income tax loss
carryforwards are only utilizable in the country where they were created. From the total unutilized income tax loss carryforwards, SEK 110 million and SEK 68 million are attributed to
Sweden and Finland, respectively. The income tax loss carryforwards attributed to Sweden can be carried forward indefinitely, while the carryforwards attributed to Finland begin to expire in 2011. The
valuation allowance at February 28, 2003 is in respect to all of the unutilized income tax loss carryforwards in Finland and certain carryforwards in Sweden.

Note 10. Intangible assets

|Goodwill                    |  | March 1, 2002 -
February 28, 2003 |   | March 1, 2001 -
February 28, 2002 |  
|--------------------------- |  | --------------------------------- | - | --------------------------------- | -
|Acquisition cost            |  |                                   |   |                                   |  
|Balance March 1             |  | 940                               |   | 940                               |  
|                            |  |                                   |   |                                   |  
|Balance February 28         |  | 940                               |   | 940                               |  
|                            |  |                                   |   |                                   |  
|Accumulated amortization    |  |                                   |   |                                   |  
|Balance March 1             |  | (131                              | ) | (86                               | )
|Amortization                |  | (44                               | ) | (45                               | )
|                            |  |                                   |   |                                   |  
|Balance February 28         |  | (175                              | ) | (131                              | )
|                            |  |                                   |   |                                   |  
|Net book value, February 28 |  | 765                               |   | 809                               |  
|                            |  |                                   |   |                                   |  

F-20

---

Note 11. Tangible assets

|Buildings and land          |  | March 1, 2002 -
February 28, 2003 |   | March 1, 2001 -
February 28, 2002 |  
|--------------------------- |  | --------------------------------- | - | --------------------------------- | -
|Acquisition cost            |  |                                   |   |                                   |  
|Balance March 1             |  | 3                                 |   | 297                               |  
|Purchases                   |  | 1                                 |   | 1                                 |  
|Sales/disposals             |  | (1                                | ) | (295                              | )
|                            |  |                                   |   |                                   |  
|Balance February 28         |  | 3                                 |   | 3                                 |  
|                            |  |                                   |   |                                   |  
|Accumulated depreciation    |  |                                   |   |                                   |  
|Balance March 1             |  | (2                                | ) | (161                              | )
|Sales/disposals             |  | 1                                 |   | 164                               |  
|Depreciation                |  |                                  |   | (5                                | )
|                            |  |                                   |   |                                   |  
|Balance February 28         |  | (1                                | ) | (2                                | )
|                            |  |                                   |   |                                   |  
|Net book value, February 28 |  | 2                                 |   | 1                                 |  
|                            |  |                                   |   |                                   |  
|Tax assessment value        |  |                                  |   |                                  |  

The
tax assessment value is the basis used by the tax authorities for computing property taxes. Several of the subsidiary Swebus Fastigheter AB's buildings are classified as
transportation buildings and as such are exempt from property taxes.

|Equipment, tools, fixtures and fittings |  | March 1, 2002 -
February 28, 2003 |   | March 1, 2001 -
February 28, 2002 |  
|--------------------------------------- |  | --------------------------------- | - | --------------------------------- | -
|Acquisition cost                        |  |                                   |   |                                   |  
|Balance March 1                         |  | 222                               |   | 213                               |  
|Purchases                               |  | 17                                |   | 20                                |  
|Sales/disposals                         |  | (7                                | ) | (12                               | )
|Other                                   |  |                                  |   | 1                                 |  
|                                        |  |                                   |   |                                   |  
|Balance February 28                     |  | 232                               |   | 222                               |  
|                                        |  |                                   |   |                                   |  
|Accumulated depreciation                |  |                                   |   |                                   |  
|Balance March 1                         |  | (178                              | ) | (161                              | )
|Sales/disposals                         |  | 7                                 |   | 12                                |  
|Depreciation                            |  | (23                               | ) | (28                               | )
|Other                                   |  |                                  |   | (1                                | )
|                                        |  |                                   |   |                                   |  
|Balance February 28                     |  | (194                              | ) | (178                              | )
|                                        |  |                                   |   |                                   |  
|Net book value, February 28             |  | 38                                |   | 44                                |  
|                                        |  |                                   |   |                                   |  

F-21

---

|Vehicles                     |  | March 1, 2002 -
February 28, 2003 |   | March 1, 2001 -
February 28, 2002 |  
|---------------------------- |  | --------------------------------- | - | --------------------------------- | -
|Acquisition cost             |  |                                   |   |                                   |  
|Balance March 1              |  | 3,713                             |   | 3,923                             |  
|Purchases and finance leases |  | 235                               |   | 130                               |  
|Sales/disposals              |  | (243                              | ) | (353                              | )
|Other                        |  | 2                                 |   | 13                                |  
|                             |  |                                   |   |                                   |  
|Balance February 28          |  | 3,707                             |   | 3,713                             |  
|                             |  |                                   |   |                                   |  
|Accumulated depreciation     |  |                                   |   |                                   |  
|Balance March 1              |  | (1,742                            | ) | (1,596                            | )
|Sales/disposals              |  | 165                               |   | 175                               |  
|Depreciation                 |  | (337                              | ) | (316                              | )
|Other                        |  |                                  |   | (5                                | )
|                             |  |                                   |   |                                   |  
|Balance February 28          |  | (1,914                            | ) | (1,742                            | )
|                             |  |                                   |   |                                   |  
|Net book value, February 28  |  | 1,793                             |   | 1,971                             |  
|                             |  |                                   |   |                                   |  

F-22

---

Concordia has the following wholly owned subsidiaries:

|                                         |  | Company's
registration
number |  | Number of shares |  | Participation
(%)
|---------------------------------------- |  | ----------------------------- |  | ---------------- |  | -----------------
|Operating company                        |  |                               |  |                  |  |                  
|Concordia Bus Nordic AB                  |  | 556031-8569                   |  | 160,000          |  | 100              
|Interbus Göteborg AB                    |  | 556097-8990                   |  | 5,000            |  | 100              
|Swebus AB                               |  | 556057-0128                   |  | 3,000            |  | 100              
|Swebus Busco AB                         |  | 556583-0527                   |  | 1,000            |  | 100              
|Swebus Express AB                       |  | 556358-3276                   |  | 5,000            |  | 100              
|Foreign subsidiary                       |  |                               |  |                  |  |                  
|Concordia Bus Finland Oy AB             |  | 0505988-8                     |  | 2,000            |  | 100              
|Ingeniør M.O. Schøyens Bilcentraler A/S |  | 915768237                     |  | 750              |  | 100              
|Real estate companies                    |  |                               |  |                  |  |                  
|Swebus Fastigheter AB                   |  | 556031-3354                   |  | 10,000           |  | 100              
|Subsidiaries to Swebus Fastigheter AB:  |  |                               |  |                  |  |                  
|Alpus AB                                |  | 556011-6571                   |  | 10,000           |  | 100              
|Malmfältens Omnibus AB                  |  | 556032-0359                   |  | 960              |  | 100              
|Enköping-Bålsta Fastighets AB           |  | 556012-9388                   |  | 1,500            |  | 100              
|Dormant companies                        |  |                               |  |                  |  |                  
|Arlanda buss AB                         |  | 556030-5335                   |  | 1,000            |  | 100              
|Billingens Trafik AB                    |  | 556027-3137                   |  | 14,000           |  | 100              
|Enköping-Bålsta Trafik AB               |  | 556410-2894                   |  | 1,000            |  | 100              
|Gävle Trafik AB                         |  | 556031-1812                   |  | 70,000           |  | 100              
|Hälsinge Wasatrafik AB                  |  | 556039-2622                   |  | 1,550            |  | 100              
|AB Härnösandsbuss                       |  | 556029-8258                   |  | 3,000            |  | 100              
|AB Interbus Finans                      |  | 556028-1122                   |  | 300              |  | 100              
|Karlstadsbuss AB                        |  | 556051-2039                   |  | 3,000            |  | 100              
|AB Kristinehamns Omnibusstrafik         |  | 556043-6445                   |  | 9,000            |  | 100              
|Saltsjöbuss AB                          |  | 556210-1500                   |  | 2,500            |  | 100              
|Swebus Service AB                       |  | 556041-6736                   |  | 1,000            |  | 100              
|Swebus Västerås AB                      |  | 556115-9988                   |  | 5,100            |  | 100              
|Tumlare Buss AB                         |  | 556068-5975                   |  | 1,010            |  | 100              
|Wasabuss AB                             |  | 556416-2419                   |  | 1,000            |  | 100              
|Wasatrafik AB                           |  | 556048-9188                   |  | 2,400            |  | 100              
|AS Concordia Bus Baltic Holding         |  | 10675176                      |  | 40,000           |  | 100              

F-23

---

Note 13. Receivables due from affiliated companies

|                             |  | March 1, 2002 -
February 28, 2003 |  | March 1, 2001 -
February 28, 2002
|---------------------------- |  | --------------------------------- |  | ---------------------------------
|Balance March 1              |  | 23                                |  |                                 
|Changes during the year      |  | 2                                 |  | 23                               
|                             |  |                                   |  |                                  
|Closing balance, February 28 |  | 25                                |  | 23                               
|                             |  |                                   |  |                                  

Receivables
for affiliated companies include amounts due from other companies in the Concordia Bus BV Group.

Note 14. Other long-term financial fixed assets

|                            |  | February 28,
2003 |  | February 28,
2002
|--------------------------- |  | ----------------- |  | -----------------
|Investments                 |  | 5                 |  | 5                
|Other long-term receivables |  |                  |  | 9                
|Capitalized financing costs |  | 92                |  | 103              
|                            |  |                   |  |                  
|Total                       |  | 97                |  | 117              
|                            |  |                   |  |                  

Investments
comprise shares and participations in various cooperative companies. None of the participations exceed 20% ownership.

Capitalized
financing costs refer to costs incurred in connection with the raising of new loans. These assets are amortized over the life of the loans.

Note 15. Inventories

|               |  | February 28,
2003 |  | February 28,
2002
|-------------- |  | ----------------- |  | -----------------
|Finished goods |  | 35                |  | 31               
|               |  |                   |  |                  

Finished
goods is primarily comprised of fuel and spare-parts.

Note 16. Accounts receivables

|                        |  | February 28,
2003 |   | February 28,
2002 |  
|----------------------- |  | ----------------- | - | ----------------- | -
|Accounts receivables    |  | 337               |   | 348               |  
|Allowance for bad debts |  | (3                | ) | (5                | )
|                        |  |                   |   |                   |  
|Total                   |  | 334               |   | 343               |  
|                        |  |                   |   |                   |  

F-24

---

The
allowance for bad debts has changed as follows:

|Balance March 1, 2000     |  | (1 | )
|------------------------- |  | -- | -
|Write-offs                |  |   |  
|Provision for the year    |  |   |  
|                          |  |    |  
|Balance February 28, 2001 |  | (1 | )
|Write-offs                |  |   |  
|Provision for the year    |  | (4 | )
|                          |  |    |  
|Balance February 28, 2002 |  | (5 | )
|Write-offs                |  | 2  |  
|                          |  |    |  
|Balance February 28, 2003 |  | (3 | )
|                          |  |    |  

Note 17. Accrued income and prepaid expenses

|                                          |  | February 28,
2003 |  | February 28,
2002
|----------------------------------------- |  | ----------------- |  | -----------------
|Accrued incomeCPTA                       |  | 99                |  | 69               
|Other prepaid expenses and accrued income |  | 79                |  | 88               
|                                          |  |                   |  |                  
|Total                                     |  | 178               |  | 157              
|                                          |  |                   |  |                  

Note 18. Cash and bank balances

|                                |  | February 28,
2003 |  | February 28,
2002
|------------------------------- |  | ----------------- |  | -----------------
|Bank overdraft facility granted |  | 50                |  | 50               
|                                |  |                   |  |                  

As
of February 28, 2003 and 2002, Concordia had not utilized any of the SEK 50 million bank overdraft facility. Included as cash and bank balances is the portion of
Concordia Bus AB's outstanding balance for the checking account connected to the group checking account, where Concordia Bus Nordic AB is the contracting part with the bank.

F-25

---

Note 19. Changes in shareholder's equity (thousands of SEK)

|                                                                                                            |  | Share capital |  | Restricted
reserves |  | Non-restricted
reserves |   | Total    |  
|----------------------------------------------------------------------------------------------------------- |  | ------------- |  | ------------------- |  | ----------------------- | - | -------- | -
|Balance March 1, 2000before change in accounting principle                                                  |  | 500           |  |                    |  | 614,637                 |   | 615,137  |  
|Impact of change in accounting principle for loss making contracts, net of taxes of SEK 12,600 (See Note 1) |  |              |  |                    |  | (32,400                 | ) | (32,400  | )
|                                                                                                            |  |               |  |                     |  |                         |   |          |  
|Balance March 1, 2000after change in accounting principle                                                   |  | 500           |  |                    |  | 582 237                 |   | 582,737  |  
|Shareholder's contribution                                                                                  |  |              |  |                    |  | 345,440                 |   | 345,440  |  
|Translation adjustments                                                                                     |  |              |  |                    |  | 1,557                   |   | 1,557    |  
|Net loss (Restated, see Note 1)                                                                             |  |              |  |                    |  | (225,774                | ) | (225,774 | )
|                                                                                                            |  |               |  |                     |  |                         |   |          |  
|Balance February 28, 2001                                                                                   |  | 500           |  |                    |  | 703,460                 |   | 703,960  |  
|Translation adjustments                                                                                     |  |              |  |                    |  | 4,191                   |   | 4,191    |  
|Net loss (Restated, see Note 1)                                                                             |  |              |  |                    |  | (285,855                | ) | (285,855 | )
|                                                                                                            |  |               |  |                     |  |                         |   |          |  
|Balance February 28, 2002                                                                                   |  | 500           |  |                    |  | 421,796                 |   | 422,296  |  
|Translation adjustments                                                                                     |  |              |  |                    |  | (135                    | ) | (135     | )
|Transfers between restricted and non-restricted reserves                                                    |  |              |  | 27,461              |  | (27,761                 | ) |         |  
|Net loss                                                                                                    |  |              |  |                    |  | (343,901                | ) | (343,901 | )
|                                                                                                            |  |               |  |                     |  |                         |   |          |  
|Balance February 28, 2003                                                                                   |  | 500           |  | 27,461              |  | 50,299                  |   | 78,260   |  
|                                                                                                            |  |               |  |                     |  |                         |   |          |  

Restricted
reserves refer to equity, which according to the Swedish Companies Act is not distributable. Annual transfers between restricted and unrestricted reserves represent annual
changes in the reserves and relate mainly to annual changes in statutory untaxed reserves of individual companies in the Concordia Bus Group.

Note 20. Net loss per share

|                              |  | March 1, 2002 -
February 28, 2003 |   | March 1, 2001 -
February 28, 2002 |   | March 1, 2000 -
February 28, 2001 |  
|----------------------------- |  | --------------------------------- | - | --------------------------------- | - | --------------------------------- | -
|Shares issued and outstanding |  | 5,000                             |   | 5,000                             |   | 5,000                             |  
|Net loss (millions of SEK)    |  | (344                              | ) | (286                              | ) | (225                              | )
|                              |  |                                   |   |                                   |   |                                   |  
|Net loss per share (SEK)      |  | (68,780                           | ) | (57,171                           | ) | (45,035                           | )
|                              |  |                                   |   |                                   |   |                                   |  

Net
loss per share is computed by dividing the net loss by the weighted-average number of shares outstanding. There were no dilutive securities outstanding during the periods presented
and the number of shares issued and outstanding has not changed. As discussed in Note 1, the net loss for the years ended February 28, 2001 and 2002 were restated.

F-26

---

Note 21. Provisions for pensions and other commitments

|                            |  | February 28, 2003 |  | February 28, 2002
|--------------------------- |  | ----------------- |  | -----------------
|Accrued pension obligations |  | 63                |  | 58               
|Other pensions commitments  |  | 6                 |  | 10               
|                            |  |                   |  |                  
|Total                       |  | 69                |  | 68               
|                            |  |                   |  |                  

The
Concordia Bus Group funds pension obligations based on the advice of external actuarial calculations and makes payments to a segregated fund managed by a specialist financial
institution. Pension costs are charged to the statement of operations on an accrual basis on actuarial calculations performed by external actuaries.

The
liability for pension obligations of employees in Norway and of certain retired employees of the subsidiary Swebus AB, who were employed during a period when the Swebus AB did not
operate a company pension scheme, is carried in the balance sheet. All pensions paid to such employees are charged against the provision. An independent actuarial valuation of the liability is carried
out on an annual basis and any increase or decrease in the provision required is reflected in the statement of operations.

Note 22. Long-term liabilities to credit institutions and capital lease obligations

Concordia's senior debt facilities include a term loan of SEK 850 million (semi-annual principal repayments begin January 15, 2004 and
end on July 17, 2006), a bullet loan of SEK 125 million (repayable in full on January 31, 2007), a general-purpose revolving credit facility of SEK 100 million and an
overdraft facility of SEK 50 million (both maturing on January 15, 2007). The traunches of term loan and bullet loan accrue interest at STIBOR or EURIBOR plus 1.25%2.00%
which is payable at intervals not to exceed three months in length. See Note 26 for a description of the various pledges associated with the senior debt facilities. The senior debt facilities
agreement contains financial covenants that apply to Concordia Bus Nordic AB including ratio of net debt to earnings before interest, taxes, depreciation, amortization (EBITDA), ratio of EBITDA to
financial costs, equity ratio, maximum net capital expenditure limits, and ratio of loans to net book value of bus fleet. In addition, the agreement contains covenants which impose limitations on
liens, sales and other disposals, incurrence of financial indebtedness, guarantees and other contingent liabilities, hedging, investments, lending monies, leasing, payment of dividends, amendments to
documents relating to the acquisition of Concordia Bus Nordic AB, insurance, and change of business. Other conditions include monthly financial reporting to the facilities agent and a prohibition on
early repayment of the senior subordinated notes discussed below. Further, the agreement requires Concordia Bus Nordic AB to enter into interest rate and/or foreign exchange and oil price hedging
arrangements in accordance with a hedging strategy approved by the facility banks. As of February 28, 2003, Concordia was in compliance with the covenants of the senior debt facilities.

Concordia
also has Euro 160 million of senior subordinated notes which will mature on February 15, 2010. Interest, accruing at a rate of 11% per annum, is payable on
February 15 and August 15 of each year until maturity. As of February 28, 2003, Concordia was in compliance with the covenants of the senior subordinated notes which, among other
things, impose limitations

F-27

---

(subject
to certain exceptions) on Concordia with respect to, inter alia, the payment of dividends or other distributions on capital, the purchase, redemption, or the acquisition or retiring for value
of share capital or any warrants, options or other rights for share capital, the incurrence, repayment or otherwise acquisition of or retirement for value of certain indebtedness, sales of assets,
sales and leasebacks by Concordia or its subsidiaries and various matters in respect of the conduct of our business, including the merger or sale of all or substantially all of our assets. Any default
on the senior debt facilities would cause Concordia to be in default on the senior subordinated notes.

Amounts
outstanding under Concordia's senior debt facilities (the term loan and bullet loan), senior subordinated debt and finance leases were as follows:

|                                                  |                                                  | February 28,
2003 |     | February 28,
2002 |    
|------------------------------------------------- | ------------------------------------------------ | ----------------- | --- | ----------------- | ---
|Senior debt facilities:                           |                                                  |                   |     |                   |    
|                                                  | Nordea Bank Norge ASA STIBOR 2%                  |                   | 28  |                   | 48 
|                                                  | Nordea Bank Norge ASA STIBOR 1.25% - 2%          |                   | 133 |                   | 137
|                                                  | Nordea Bank Norge ASA EURIBOR 1.25% - 2%         |                   | 52  |                   | 53 
|                                                  | Den Norske Bank ASA STIBOR 2%                    |                   | 32  |                   | 48 
|                                                  | Den Norske Bank ASA STIBOR 1.25% - 2%            |                   | 151 |                   | 137
|                                                  | Den Norske Bank ASA EURIBOR 1.25% - 2%           |                   | 59  |                   | 53 
|                                                  | Nordea Bank Sweden AB STIBOR 2%                  |                   | 22  |                   | 38 
|                                                  | Nordea Bank Sweden AB STIBOR 1.25% - 2%          |                   | 103 |                   | 107
|                                                  | Nordea Bank Sweden AB EURIBOR 1.25% - 2%         |                   | 40  |                   | 41 
|                                                  | Landesbank Schleswig-Holstein STIBOR 2%          |                   | 22  |                   | 38 
|                                                  | Landesbank Schleswig-Holstein STIBOR 1.25% - 2%  |                   | 103 |                   | 107
|                                                  | Landesbank Schleswig-Holstein EURIBOR 1.25% - 2% |                   | 40  |                   | 41 
|                                                  | Fortis Bank STIBOR 2%                            |                   | 13  |                   | 21 
|                                                  | Fortis Bank STIBOR 1.25% - 2%                    |                   | 59  |                   | 61 
|                                                  | Fortis Bank EURIBOR 1.25% - 2%                   |                   | 23  |                   | 24 
|                                                  | Deutsche Verkehrbank AG STIBOR 2%                |                   | 13  |                   | 21 
|                                                  | Deutsche Verkehrbank AG STIBOR 1.25% - 2%        |                   | 59  |                   | 61 
|                                                  | Deutsche Verkehrbank AG EURIBOR 1.25% - 2%       |                   | 23  |                   | 24 
|Senior Subordinated Notes 11%                     |                                                  | 1,460             |     | 1,454             |    
|                                                  |                                                  |                   |     |                   |    
|Total borrowings before finance lease obligations |                                                  | 2,435             |     | 2,514             |    
|Finance lease obligations                         |                                                  | 28                |     |                  |    
|                                                  |                                                  |                   |     |                   |    
|Total borrowings                                  |                                                  | 2,463             |     | 2,514             |    
|Less current maturities                           |                                                  | (145              | )   | (39               | )  
|                                                  |                                                  |                   |     |                   |    
|Total                                             |                                                  | 2,318             |     | 2,475             |    
|                                                  |                                                  |                   |     |                   |    

F-28

---



STIBOR1 and EURIBOR were as follows:

|                 |  | February 28, 2003 |  
|---------------- |  | ----------------- | -
|STIBOR 7 days    |  | 3.200             | %
|STIBOR 90 days   |  | 3.680             | %
|STIBOR 360 days  |  | 3.680             | %
|EURIBOR 90 days  |  | 2.533             | %
|EURIBOR 360 days |  | 2.412             | %

---

Interest expense and similar items

|                                                    |  | March 1, 2002 -
February 28, 2003 |   | March 1, 2001 -
February 28, 2002 |   | March 1, 2000 -
February 28, 2001 |  
|--------------------------------------------------- |  | --------------------------------- | - | --------------------------------- | - | --------------------------------- | -
|Interest expense for loans from credit institutions |  | (73                               | ) | (105                              | ) | (95                               | )
|Interest expense for high-yield bond                |  | (161                              | ) | (103                              | ) | (99                               | )
|Refinancing costs                                   |  | (17                               | ) | (17                               | ) | (14                               | )
|Other interest costs                                |  | (11                               | ) |                                  |   |                                  |  
|Exchange rate gain (loss)                           |  | (3                                | ) | 3                                 |   | (84                               | )
|                                                    |  |                                   |   |                                   |   |                                   |  
|Total                                               |  | (265                              | ) | (222                              | ) | (292                              | )
|                                                    |  |                                   |   |                                   |   |                                   |  

Borrowings are repayable as follows:

|                                |  | February 28, 2003 |   | February 28, 2002 |  
|------------------------------- |  | ----------------- | - | ----------------- | -
|On demand or within 1 year      |  | 145               |   | 39                |  
|Within 1-2 years                |  | 269               |   | 125               |  
|Within 2-3 years                |  | 302               |   | 250               |  
|Within 3-4 years                |  | 287               |   | 300               |  
|Within 4-5 years                |  |                  |   | 346               |  
|Within 5-6 years                |  |                  |   |                  |  
|Over 6 years                    |  | 1,460             |   | 1,454             |  
|                                |  |                   |   |                   |  
|Total borrowings                |  | 2,463             |   | 2,514             |  
|Less current maturities         |  | (145              | ) | (39               | )
|                                |  |                   |   |                   |  
|Long-term portion of borrowings |  | 2,318             |   | 2,475             |  
|                                |  |                   |   |                   |  

F-29

---

The following is a schedule by years of future minimum gross lease payments under finance leases together with the present value of the net minimum lease payments
as of February 28, 2003:

|Year Ending:                            |                   |    |  
|--------------------------------------- | ----------------- | -- | -
|                                        | February 29, 2004 |    | 8
|                                        | February 28, 2005 |    | 7
|                                        | February 28, 2006 |    | 8
|                                        | February 28, 2007 |    | 4
|                                        | February 29, 2008 |    | 4
|                                        | Later years       |    | 2
|                                        |                   |    |  
|Total minimum gross lease payments      |                   | 33 |  
|Less: Amount representing interest      |                   | (5 | )
|                                        |                   |    |  
|Present value of minimum lease payments |                   | 28 |  
|                                        |                   |    |  

Interest rate and currency profile of total borrowings at February 28, 2003

|Currency                                             |  | SEK Equivalent |  | Weighted-average floating
interest rate |  
|---------------------------------------------------- |  | -------------- |  | --------------------------------------- | -
|Swedish krona                                        |  | 739            |  | 5.671                                   | %
|Euro                                                 |  | 1,696          |  | 10.113                                  | %
|                                                     |  |                |  |                                         |  
|Total borrowings excluding finance lease obligations |  | 2,435          |  |                                         |  
|                                                     |  |                |  |                                         |  

Note 23. Other current liabilities

|                             |  | February 28, 2003 |  | February 28, 2002
|---------------------------- |  | ----------------- |  | -----------------
|VAT and other special taxes  |  |                  |  | 25               
|Employeewithholding taxes   |  | 58                |  | 58               
|Other short-term liabilities |  | 46                |  | 96               
|                             |  |                   |  |                  
|Total                        |  | 104               |  | 179              
|                             |  |                   |  |                  

F-30

---

Note 24. Accrued expenses and deferred income

|                                                       |  | February 28, 2003 |  | February 28, 2002
|------------------------------------------------------ |  | ----------------- |  | -----------------
|Deferred incomeCPTA                                   |  | 83                |  | 87               
|Accrued employee costs (payroll, social charges, etc.) |  | 251               |  | 205              
|Accrued interest expenses                              |  | 12                |  | 9                
|Other accrued expenses                                 |  | 97                |  | 123              
|                                                       |  |                   |  |                  
|Total                                                  |  | 443               |  | 424              
|                                                       |  |                   |  |                  

Note 25. Operating leases

Future lease payments for rentals due calculated at net present value are as follows:

|                                           |                       | February 28, 2003 |     | February 28, 2002
|------------------------------------------ | --------------------- | ----------------- | --- | -----------------
|Net present value of future lease payments |                       |                   |     |                  
|                                           | Vehicles              |                   | 945 |                  
|                                           | Real estate and other |                   | 58  |                  
|                                           |                       |                   |     |                  
|Total                                      |                       | 1,003             |     | 748              
|                                           |                       |                   |     |                  

At
February 28, 2003, Concordia operated 1,156 buses under operating leases. Concordia also leases nine real estate properties through operating leases.

Total
future minimum lease payments discounted for each of the periods are as follows:

|                      |  | Less than 1
year |  | 1-3 years |  | 4-5 years |  | After 5 years |  | Total
|--------------------- |  | ---------------- |  | --------- |  | --------- |  | ------------- |  | -----
|Vehicles              |  | 356              |  | 432       |  | 142       |  | 15            |  | 945  
|Real estate and other |  | 9                |  | 17        |  | 15        |  | 17            |  | 58   
|                      |  |                  |  |           |  |           |  |               |  |      
|Total                 |  | 365              |  | 449       |  | 157       |  | 32            |  | 1,003
|                      |  |                  |  |           |  |           |  |               |  |      

The
following is a schedule by years of future minimum gross rental payments required under operating leases as of February 28, 2003:

|Year Ending:                 |                   |      
|---------------------------- | ----------------- | -----
|                             | February 29, 2004 |      
|                             | February 28, 2005 |      
|                             | February 28, 2006 |      
|                             | February 28, 2007 |      
|                             | February 29, 2008 |      
|                             | Later years       |      
|                             |                   |      
|Total minimum lease payments |                   | 1,143
|                             |                   |      

F-31

---

Note 26. Pledged assets and contingent liabilities

|                                               |  | February 28, 2003 |  | February 28, 2002
|---------------------------------------------- |  | ----------------- |  | -----------------
|Pledged shares in subsidiaries(a)              |  | 973               |  | 1,312            
|Floating charge certificates(b)                |  | 117               |  | 117              
|Pledged assets(c)                              |  | 1,757             |  | 1,971            
|Guarantees and other contingent liabilities(d) |  | 45                |  | 1                
|Conditional shareholder's contribution(e)      |  | 648               |  | 648              
|                                               |  |                   |  |                  
|Total                                          |  | 3,540             |  | 4,049            
|                                               |  |                   |  |                  

---



|Swebus AB                     |  | SEK 100 million
|----------------------------- |  | ---------------
|Alpus AB                      |  | SEK 0.6 million
|Enköping-Bålsta Fastighets AB |  | SEK 2.4 million
|Malmfältens Omnibus AB        |  | SEK 2.5 million
|Concordia Bus Finland Oy AB   |  | EURO1.3 million

F-32

---

Note 27. Fair value of derivative financial instruments

Fuel hedge contracts

Concordia Bus Group is exposed to commodity price risk through its fuel usage. Management has made a strategic decision to actively try to minimize the negative
effects of fluctuations in the market price. On February 28, 2003, 77% of Concordia's expected future fuel usage was hedged against price and currency fluctuations through swaps, caps and
currency options for the coming 12 months.

Interest/currency hedges

Certain of Concordia's borrowings bear interest at a floating rate. Management has made a decision to reduce the volatility on cash flows and earnings due to the
risk of interest rate fluctuations through entering into interest rate swaps and caps, which gives Concordia a larger portion of fixed interest rate arrangements. On February 28, 2003, 55% of
Concordia's interest payments with floating rate were effectively at a fixed rate for the next three years.

Concordia
is also exposed to currency fluctuations, primarily as a result of loans denominated in Euros. Management has made a conscious decision to try to reduce the volatility on cash
flows and earnings due to the impact of currency fluctuations on cash payments related to foreign currencies and has, therefore, entered into currency option arrangements. At February 28, 2003,
50% of the future interest payments for the coming three years on the senior subordinated notes (EURO100 million) were hedged. At February 28, 2003, 50% of the future
interest payments on the senior subordinated notes (EURO60 million) have been hedged through currency options for the coming three years.

F-33

---

The
amounts of interest rates swap and caps in place at February 28, 2003 relating to Concordia's hedging of interest rate risk on its borrowings were as follows (exact amounts):

|                   |  | Contract notional amount |  | Effective
fixed rate |   | Settlement date  |  | Fair value:
Unrealized gain (loss)
(SEK) |  
|------------------ |  | ------------------------ |  | -------------------- | - | ---------------- |  | ---------------------------------------- | -
|Interest rate cap  |  | SEK 75,000,000           |  | 7.00                 | % | May 19, 2003     |  | (126,426                                 | )
|Interest rate cap  |  | SEK 75,000,000           |  | 7.00                 | % | June 19, 2003    |  | (262,213                                 | )
|Interest rate cap  |  | SEK 40,000,000           |  | 6.00                 | % | June 20, 2005    |  | 16,854                                   |  
|Interest rate swap |  | SEK 112,500,000          |  | 4.78                 | % | June 19, 2004    |  | (1,089,000                               | )
|Interest rate swap |  | SEK 50,000,000           |  | 5.68                 | % | May 19, 2005     |  | (560,500                                 | )
|Interest rate swap |  | SEK 50,000,000           |  | 5.73                 | % | July 19, 2005    |  | (550,000                                 | )
|Interest rate swap |  | SEK 75,000,000           |  | 5.61                 | % | January 19, 2005 |  | (1,621,688                               | )
|Interest rate swap |  | SEK 75,000,000           |  | 5.04                 | % | May 19, 2004     |  | (2,003,200                               | )
|Interest rate cap  |  | EURO 15,977,853          |  | 7.00                 | % | April 22, 2003   |  | (87,642                                  | )
|Interest rate swap |  | EURO 16,000,000          |  | 5.50                 | % | July 19, 2006    |  | (289,382                                 | )
|Interest rate swap |  | EURO 15,977,853          |  | 5.05                 | % | April 22, 2003   |  | (826,628                                 | )
|Interest rate swap |  | EURO 30,000,000          |  | 4.71                 | % | April 19, 2004   |  | (5,992,476                               | )
|Interest rate swap |  | EURO 30,000,000          |  | 4.96                 | % | April 19, 2005   |  | (6,336,516                               | )
|Interest rate swap |  | EURO 9,000,000           |  | 4.84                 | % | July 19, 2006    |  | (1,458,567                               | )
|                   |  |                          |  |                      |   |                  |  |                                          |  
|TOTAL              |  |                          |  |                      |   |                  |  | (21,187,384                              | )
|                   |  |                          |  |                      |   |                  |  |                                          |  

F-34

---

The
amounts of currency options arrangements in place at February 28, 2003 relating to Concordia's hedging of currency risk on its borrowings were as follows (exact amounts):

|           |  | Contract notional amount |   | Strike* |  | Exercise date     |  | Fair value: Unrealized gain (loss) (SEK) |  
|---------- |  | ------------------------ | - | ------- |  | ----------------- |  | ---------------------------------------- | -
|Call held  |  | EURO (2,727,500          | ) | 11.49   |  | August 11, 2003   |  |                                         |  
|Put issued |  | EURO 2,727,500           |   | 8.50    |  | August 11, 2003   |  | (12 679                                  | )
|Call held  |  | EURO (1,650,000          | ) | 9.85    |  | August 11, 2003   |  | 14 262                                   |  
|Put issued |  | EURO 1,650,000           |   | 8.80    |  | August 11, 2003   |  | (48 481                                  | )
|Call held  |  | EURO (2,727,500          | ) | 11.88   |  | February 11, 2004 |  | 21                                       |  
|Put issued |  | EURO 2,727,500           |   | 8.50    |  | February 11, 2004 |  | (68,923                                  | )
|Call held  |  | EURO (1,650,000          | ) | 9.99    |  | February 11, 2004 |  | 55,589                                   |  
|Put issued |  | EURO 1,650,000           |   | 8.80    |  | February 11, 2004 |  | (119,172                                 | )
|Call held  |  | EURO (2,727,500          | ) | 12.03   |  | August 11, 2004   |  | 371                                      |  
|Put issued |  | EURO 2,727,500           |   | 8.50    |  | August 11, 2004   |  | (121,211                                 | )
|Call held  |  | EURO (1,650,000          | ) | 10.17   |  | August 11, 2004   |  | 78,915                                   |  
|Put issued |  | EURO 1,650,000           |   | 8.80    |  | August 11, 2004   |  | (165,046                                 | )
|Call held  |  | EURO (4,400,000          | ) | 10.39   |  | February 9, 2005  |  | 235,763                                  |  
|Put issued |  | EURO 4,400,000           |   | 8.80    |  | February 9, 2005  |  | (528,073                                 | )
|Call held  |  | EURO (4,400,000          | ) | 10.92   |  | August 10, 2005   |  | 29,505                                   |  
|Put issued |  | EURO 4,400,000           |   | 8.70    |  | August 10, 2005   |  | (212,382                                 | )
|           |  |                          |   |         |  |                   |  |                                          |  
|TOTAL      |  |                          |   |         |  |                   |  | (861,541                                 | )
|           |  |                          |   |         |  |                   |  |                                          |  

---

F-35

---

The
amounts of currency forward contracts in place at February 28, 2003 relating to Concordia's hedging of currency risk on its diesel swap arrangements were as follows (exact
amounts):

|                 |  | Contract amount |          | Forward rate** |       | Settlement date |                   | Fair value:
Unrealized gain (loss)
(SEK) |           
|---------------- |  | --------------- | -------- | -------------- | ----- | --------------- | ----------------- | ---------------------------------------- | ----------
|Forward contract |  | $               | (190,150 | )              | 10.67 |                 | Mars 7, 2003      |                                          | (411,486  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | Apri17, 2003      |                                          | (233,646  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | Apri17, 2003      |                                          | (235,892  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | May 7, 2003       |                                          | (230,503  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | May 7, 2003       |                                          | (232,792  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | June 6, 2003      |                                          | (227,395  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | June 6, 2003      |                                          | (229,725  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | July 7, 2003      |                                          | (224,236  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | July 7, 2003      |                                          | (226,608  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | August 7, 2003    |                                          | (221,077  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | August 7, 2003    |                                          | (223,491  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | September 5, 2003 |                                          | (218,124  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | September 5, 2003 |                                          | (220,577  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | October 7, 2003   |                                          | (214,924  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | October 7, 2003   |                                          | (217,418  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | November 7, 2003  |                                          | (211,824  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | November 7, 2003  |                                          | (214,358  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | December 5, 2003  |                                          | (209,031  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | December 5, 2003  |                                          | (211,602  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | January 8, 2004   |                                          | (205,897  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | January 8, 2004   |                                          | (208,508  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | February 6, 2004  |                                          | (203,223  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | February 6, 2004  |                                          | (205,870  
|Forward contract |  | $               | (225,000 | )              | 9.55  |                 | March 5, 2004     |                                          | (200,648  
|Forward contract |  | $               | (225,500 | )              | 9.57  |                 | March 5, 2004     |                                          | (203,328  
|                 |  |                 |          |                |       |                 |                   |                                          |           
|TOTAL            |  |                 |          |                |       |                 |                   |                                          | (5,642,183
|                 |  |                 |          |                |       |                 |                   |                                          |           

---

F-36

---



The amounts of diesel swap and cap arrangements in place at February 28, 2003 relating to Concordia's hedging of commodity risk on its diesel purchases
were as follows (exact amounts):

|            |  | Contract notional
volume (tons) |  | Fixed/capped
price per ton |     | Settlement date |                   | Fair value:
Unrealized gain (loss)
(SEK)
|----------- |  | ------------------------------- |  | -------------------------- | --- | --------------- | ----------------- | ----------------------------------------
|Diesel swap |  | 1,000                           |  | $                          | 190 |                 | February 28, 2003 |                                         
|Diesel swap |  | 12,000                          |  | $                          | 225 |                 | February 28, 2004 |                                         
|Diesel swap |  | 12,000                          |  | $                          | 223 |                 | February 28, 2004 |                                         
|Diesel cap  |  | 6,500                           |  | $                          | 301 |                 | May 31, 2003      |                                         
|            |  |                                 |  |                            |     |                 |                   |                                         
|TOTAL       |  |                                 |  |                            |     |                 |                   |                                         
|            |  |                                 |  |                            |     |                 |                   |                                         

Note 28. Interest income

|                                          |  | March 1, 2002 -
February 28, 2003 |  | March 1, 2001 -
February 28, 2002 |  | March 1, 2000 -
February 28, 2001
|----------------------------------------- |  | --------------------------------- |  | --------------------------------- |  | ---------------------------------
|Interest income from affiliated companies |  | 3                                 |  |                                  |  |                                 
|Other interest income                     |  | 7                                 |  | 5                                 |  | 6                                
|                                          |  |                                   |  |                                   |  |                                  
|Total                                     |  | 10                                |  | 5                                 |  | 6                                
|                                          |  |                                   |  |                                   |  |                                  

Note 29. Other provisions

|                                                  |  | February 28, 2003 |  | February 28, 2002
|------------------------------------------------- |  | ----------------- |  | -----------------
|Provisions for loss making contracts (See Note 1) |  | 46                |  | 31               
|                                                  |  |                   |  |                  

Note 30. Going-concern matters

Concordia has approximately SEK 2,435 million of long term debt due to third parties, excluding long term finance lease obligations. Concordia's ability to
service the existing debt (interest and amortization) is dependent on the underlying businesses generating sufficient cash flow. Revenues generated by the underlying businesses during the period
March 1, 2002February 28, 2003 have not been sufficient to cover their costs.

Concordia
Bus Nordic AB and its subsidiaries are continuing to implement cost reduction initiatives and have started to see signs of significant improvements in compensation levels from
their contracts with public transportation authorities. If the cost-cutting initiatives or other measures that management deem required are not successful and losses continue, these
companies' equity bases may need to be restored and, if they are not able to comply with the covenants of the debt agreements, they may require waivers from their lenders or additional equity funding
in order to continue to present financial statements under the assumption that Concordia will continue as a going concern.

F-37

---

These
financial statements have been prepared under the assumption that Concordia will be successful in its initiatives and, consequently, they have been prepared assuming that Concordia
will continue as a going concern. These financial statements have also been prepared under the assumption that Concordia will be in compliance with its debt covenants for the upcoming
12-month period. If Concordia were to be in breach of any of its debt covenants during the next 12 months, a major portion of its long-term debt would become due and
payable.

Note 31. Cash Flow Statement

The cash flow statement is derived from the statement of operations and other changes between the opening and closing balance sheets, eliminating the effect of
currency translation differences. The cash and bank balances in the cash flow statement includes securities, time deposits and the used portion of bank overdrafts. Movements in provisions against
assets have been included with the movements of the assets.

Note 32. Related party transactions

Two of the supervisory board members of Concordia Bus BV, the parent company of Concordia Bus AB are appointed by Schøyen Gruppen A/S
("Schøyen Group") and two are appointed by Bus Holdings S.A.R.l, an affiliate of Goldman Sachs International. Each director of Concordia may receive compensation for services in that
capacity. Erik Linnarsson is a partner at Advokatfirman Lindahl HB, which acts as legal counsel to Concordia and he was formerly a director of Concordia Bus AB and remains a director of certain of our
operating subsidiaries.

Under
a lease arrangement between Schøyen Group and Ingeniør M.O. Schøyens Bilcentraler A/S, Schøyen Group has leased depots and other
real property to SBC for a period of ten years ending in 2009. The rentals paid were SEK 15 million, SEK 14 million, and SEK 13 million for the years ended February 28,
2003, 2002 and 2001, respectively.

Schøyen
Prosjekt and Finans ASA, an affiliated company of Schøyen Group, was engaged to provide consulting services in relation to the acquisition by Concordia of
Sporveiebussen AS, an operator of approximately 160 buses in Norway. The fees paid for their services were SEK 0.3 million and SEK 0.6 million for the years ended February 28,
2002 and 2001, respectively. In addition, they have been engaged in connection with securing the sale and leaseback of properties belonging to Swebus. For the year ended February 28, 2002,
their fees for this service were SEK 2.4 million and SEK 0.5 million for the years ended February 28, 2002 and 2001, respectively. No services were provided by Schøyen
Prosjekt and Finans ASA during the year ended February 28, 2003.

In
addition to being 18% owned by SG, Schøyen Prosjekt and Finans ASA is 72% owned by Finans Forvaltning AS. Finans Forvaltning AS is 51% owned by Frode Larsen, 22.25% owned
by Georg Kervel, and 4.5% owned by Harold Arnvaern.

Concordia
Bus Management A/S, an affiliated company 100% owned by Concordia Bus BV, has provided management services to Concordia Bus AB and its subsidiaries. A management fee has been
charged to Concordia Bus AB and their subsidiaries for these services amounting to SEK

F-38

---

23 million,
SEK 25 million, and SEK 31 million for years ended February 28, 2003, 2002 and 2001, respectively.

Note 33. Reconciliation to accounting principles generally accepted in the United States of America

Accounting policies used by the Concordia Bus Group conform with accounting principles generally accepted in Sweden ("Swedish GAAP") which differ in certain
significant respects from accounting principles generally accepted in the United States of America ("U.S. GAAP"). Below is a description of these differences and a reconciliation of net loss,
shareholder's equity and cash flows to U.S. GAAP.

|                                                             |                                       | Note |    | Year ended
February 28, 2003 |     | Year ended
February 28, 2002 |     | Year ended
February 28, 2001 |    
|------------------------------------------------------------ | ------------------------------------- | ---- | -- | ---------------------------- | --- | ---------------------------- | --- | ---------------------------- | ---
|Net loss under Swedish GAAP(See Note 1)                      |                                       |      |    | (344                         | )   | (286                         | )   | (225                         | )  
|Adjustments:                                                 |                                       |      |    |                              |     |                              |     |                              |    
|                                                             | Goodwill amortization                 |      | (a | )                            | 44  |                              | (4  | )                            | (3 
|                                                             | Pensions                              |      | (b | )                            | 1   |                              | (2  | )                            | 1  
|                                                             | Refund from defined contribution plan |      | (c | )                            |    |                              | 53  |                              | 1  
|                                                             | Derivative financial instruments      |      | (d | )                            | (11 | )                            | (8  | )                            | 4  
|                                                             | Sale-leaseback of real estate         |      | (e | )                            | 8   |                              | (11 | )                            | (50
|                                                             | Lease classification                  |      | (f | )                            | (8  | )                            | (4  | )                            |   
|Tax effect of U.S. GAAP adjustments                          |                                       |      |    | 9                            |     | (7                           | )   | 12                           |    
|                                                             |                                       |      |    |                              |     |                              |     |                              |    
|Net loss under U.S. GAAP                                     |                                       |      |    | (301                         | )   | (269                         | )   | (260                         | )  
|                                                             |                                       |      |    |                              |     |                              |     |                              |    
|Number of shares                                             |                                       |      |    | 5,000                        |     | 5,000                        |     | 5,000                        |    
|Primary and diluted net loss per share under U.S. GAAP (SEK) |                                       |      |    | (60,180                      | )   | (53,728                      | )   | (51,920                      | )  
|                                                             |                                       |      |    |                              |     |                              |     |                              |    

During
the year ended February 28, 2002, Concordia issued new debt in order to refinance certain of its existing senior term loans and also revolving credit facilities. Certain of
the costs incurred in connection with this refinancing has, under Swedish GAAP been expensed as financing

F-39

---

costs.
Under U.S.GAAP, those costs, amounting to SEK 2 million would be treated as an extraordinary loss.

|                                        |  | Note |   | February 28, 2003 |   | February 28, 2002 |   | February 28, 2001 |  
|--------------------------------------- |  | ---- | - | ----------------- | - | ----------------- | - | ----------------- | -
|Shareholder's equity under Swedish GAAP |  |      |   | 78                |   | 422               |   | 704               |  
|Adjustments:                            |  |      |   |                   |   |                   |   |                   |  
|Goodwill amortization                   |  | (a   | ) | 37                |   | (7                | ) | (3                | )
|Pensions                                |  | (b   | ) | (7                | ) | (8                | ) | (7                | )
|Refund from defined contribution plan   |  | (c   | ) | 54                |   | 54                |   | 1                 |  
|Derivative financial instruments        |  | (d   | ) | (26               | ) | (3                | ) | 4                 |  
|Sale-leaseback of real estate           |  | (e   | ) | (50               | ) | (58               | ) | (50               | )
|Lease classification                    |  | (f   | ) | (11               | ) | (3                | ) |                  |  
|Tax effect of U.S. GAAP adjustments     |  |      |   | 11                |   | 2                 |   | 15                |  
|                                        |  |      |   |                   |   |                   |   |                   |  
|Shareholder's equity under U.S. GAAP    |  |      |   | 86                |   | 399               |   | 664               |  
|                                        |  |      |   |                   |   |                   |   |                   |  

Under
Swedish GAAP, Concordia's cash flow statements are presented in accordance with the Swedish Financial Accounting Standards Council's recommendation No. 7. These statements
present substantially the same information as is required under U.S. Statement of Financial Accounting Standards No. 95, Statement of Cash Flows although the classification of certain items is
different.

A
summary of Concordia's operating, investing and financing activities, classified in accordance with U.S. GAAP, utilizing the amounts shown in the Swedish GAAP cash flow statement, are
as follows:

|                                                      |  | Year ended
February 28, 2003 |   | Year ended
February 28, 2002 |  | Year ended
February 28, 2001 |  
|----------------------------------------------------- |  | ---------------------------- | - | ---------------------------- |  | ---------------------------- | -
|Cash flows provided by (used in) operating activities |  | 11                           |   | 95                           |  | (72                          | )
|Cash flows provided by (used in) investing activities |  | (136                         | ) | 53                           |  | 3                            |  
|Cash flow provided by (used in) financing activities  |  | (95                          | ) | 28                           |  | 153                          |  
|                                                      |  |                              |   |                              |  |                              |  
|Net increase/(decrease) in cash and bank balances     |  | (220                         | ) | 176                          |  | 84                           |  
|                                                      |  |                              |   |                              |  |                              |  



F-40

---



F-41

---



2003

2002

2001Balance at March 1 for U.S. GAAP reporting purposes

856

905

691Acquisitions





250Amortization



(49
)
(36
)Balance at February 28 for U.S. GAAP reporting purposes

856

856

905




2003

2002

2001Reported net loss in accordance with U.S. GAAP

(301
)
(269
)
(260
)Add: Goodwill amortization, net of tax of nil



49

36Adjusted net loss in accordance with U.S. GAAP

(301
)
(220
)
(224
)


2003

2002

2001Reported basic and diluted net loss per share in accordance with U.S. GAAP

(60,392
)
(53,728
)
(51,920
)Add: Goodwill amortization, net of tax of nil



9,800

7,200Adjusted basic and diluted net loss per share accordance with U.S. GAAP

(60,180
)
(43,928
)
(44,720
)






F-42

---



2003Change in benefit obligation:Benefit obligation beginning of the year

191Service cost

6Interest cost

13Actuarial (gains) losses

1Benefits paid

(15
)Benefit obligation end of the year

196Change in plan assets:Fair value of plan assets at the beginning of the year

112Actual return on plan assets

8Employer contributions

11Benefits paid

(15
)Fair value of plan assets at the end of the year

116Funded status

(80
)Unrecognized net actuarial (gain) loss

9Accrued benefit obligation

(71
)Components of net pension cost:Service cost

6Interest cost

13Expected return on plan assets

(8
)Amortization of net actuarial (gain) loss

(1
)Social charges

1Net pension cost

11Weighted-average assumptions at year end:Discount rates

5.5 - 7.0
%Expected return on plan assets

8.0
%Rate of compensation increases

2.5
%Inflation rates

2.0
%






F-43

---





F-44

---







F-45

---





Year ended
February 28, 2003

Year ended
February 28, 2002

Year ended
February 28, 2001Net loss

(301
)
(269
)
(260
)Other comprehensive income (loss):Change in cumulative translation adjustment

(12
)
4

2Comprehensive loss

(313
)
(265
)
(258
)


Shareholder's EquityBalance March 1, 2000

577Shareholder's contribution from Concordia Bus BV

345Change in cumulative translation adjustment

2Net loss

(260
)Balance February 28, 2001

664Change in cumulative translation adjustment

4Net loss

(269
)Balance February 28, 2002

399Change in cumulative translation adjustment

(12
)Net loss

(301
)Balance February 28, 2003

86






F-46

---



F-47

---





F-48

---



Item 18.Financial Statements

Not applicable.

F-49

---



Item 19.    Exhibits

|1.        |  | Articles of Association of CB Bus AB (publ).*                                                                                                                                                                                                                                                                                 
|--------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2(c).     |  | Indenture, dated February 7, 2000, between CB Bus AB (publ) and Bankers Trust Company, in respect of Concordia Bus AB's Euro100,000,000 11% Senior Subordinated Notes due February 15, 2010.*                                                                                                                                 
|4(a)(1).  |  | Subscription and Shareholders' Agreement, dated October 27, 1999, by and among Concordia Bus B.V., Schøyen Gruppen A/S, Bus Holdings S.a.r.l., and Goldman Sachs International.*                                                                                                                                               
|4(a)(2).  |  | Call Option Assignment Agreement, dated January 14, 2000 between CB Bus AB (publ) as assignor and Christiania Bank og Kreditkasse ASA as security agent.*                                                                                                                                                                     
|4(a)(3).  |  | Security Agent Agreement, dated February 7, 2000, by and among, Christiania Bank og Kreditkasse ASA as senior agent and security agent, CB Bus AB (publ), and Bankers Trust Company, as Trustee.*                                                                                                                             
|4(a)(4).  |  | Declaration of Pledge dated January 14, 2000 between Schøyen Gruppen and Christiania Bank og Kreditkasse ASA, as security agent.*                                                                                                                                                                                              
|4(a)(5).  |  | Addendum No. 1 to Declaration of Pledge dated February 4, 2000 between Schøyen Gruppen and Christiania Bank og Kreditkasse ASA, as security agent.*                                                                                                                                                                            
|4(a)(6).  |  | Deed for the Sale and Purchase of Ingenior M.O. Schøyens Bilcentraler A/S dated October 27, 1999 by and among Schøyen Gruppen A/S, as seller, Concordia Bus BV, Goldman Sachs International as senior
agent and mezzanine agent, and AB Grundstenen 85302, as buyer.*                                                          
|4(a)(7).  |  | Supplemental Deed to Original Deed for the Sale and Purchase of Ingenior M.O. Schøyens Bilcentraler A/S, dated January 14, 2000, by and among Schøyen Gruppen A/S, as seller, Concordia Bus BV, CB Bus AB
(publ), Goldman Sachs International, and Christiania Bank og Kreditkasse ASA.*                                      
|4(a)(8).  |  | Deed of Accession and Adherence and Supplemental Deed to Deed for the Sale and Purchase of Ingenior M.O. Schøyens Bilcentraler A/S, dated February 4, 2000 by and among Schøyen Gruppen A/S, Concordia Bus
BV, CB Bus AB (publ), Goldman Sachs International, Christiania Bank og Kreditkasse ASA, and Bankers Trust Company.*
|4(a)(9).  |  | Supplemental Deed No. 3 to Deed for the Sale and Purchase of Ingenior M.O. Schøyens Bilcentraler A/S, dated February 24, 2000, by and among Schøyen Gruppen A/S, Concordia Bus BV, CB Bus AB
(publ), Goldman Sachs International, Christiania Bank Og Kreditkasse ASA, and Bankers Trust Company.*                            
|4(a)(10). |  | Acquisition Facility Agreement, dated January 14, 2000, by and among CB Bus AB (publ), as borrower, Christiania Bank og Kreditkasse ASA and Den norske Bank ASA as arrangers and banks, and Christiania Bank og
Kreditkasse ASA as agent.*                                                                                    
|4(a)(11). |  | Swebus Facility Agreement, dated January 14, 2000, by and among Concordia Bus Nordic AB, as borrower, Christiania Bank og Kreditkasse ASA and Den norske Bank ASA as arrangers and banks, and Christiania
Bank og Kreditkasse ASA as agent.*                                                                                 
|4(a)(12). |  | Framework Leasing Agreement, dated October 28, 1998, between Ingenior M.O. Schøyens Bilcentraler and Den norske Bank Finans.*                                                                                                                                                                                                  
|4(a)(13). |  | Amended Senior Facilities Agreement, dated February 15, 2002, by and among Concordia Bus Nordic AB, as borrower, Nordea Bank Norge ASA and Den Norske Bank ASA, as arrangers and banks, and Nordea Bank Norge ASA, as
agent.***                                                                                                
|4(c)(1).  |  | Management services agreement, dated January 14, 2000, by and among, Concordia Bus Management A/S, Concordia Bus BV, CB Bus AB (publ) and Ingenior M. O. Schoyens Bilcentraler A/S.**                                                                                                                                          
|6.        |  | Statement re computation of per share earnings.                                                                                                                                                                                                                                                                                
|7.        |  | Statement re computation of ratios.                                                                                                                                                                                                                                                                                            
|          |  |                                                                                                                                                                                                                                                                                                                                

II-1

---

|8.        |  | Subsidiaries of registrant.                                                                                        
|--------- |  | -------------------------------------------------------------------------------------------------------------------
|12.       |  | Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                          
|13(a)(1). |  | Certification of Frode Larsen, chief executive officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 
|13(a)(2). |  | Certification of Vasant Mistry, chief financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|14.       |  | Letter concerning Arthur Andersen****                                                                              

---

II-2

---



SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the
undersigned to sign this annual report on its behalf.

| |  | Concordia Bus AB (publ)(Registrant)
/s/ VASANT MISTRY(Signature)
| |  | ----------------------------------------------------------------
| |  | Vasant Mistry                                                   
| |  | Chief Financial Officer                                         

Date:
June 27, 2003

II-3

---