Strategically, 2001 was a year both of progress and frustration. Operationally, dramatic steps were taken to reduce costs at BAX Global, to fix problem areas and expand service offerings at Brink's, Incorporated and to further develop platforms for long-term growth at Brink's Home Security. Each of these accomplishments helped to enhance already high quality customer service thereby positioning each business for improved future financial performance.

BAX Global
By the end of 2001, nowhere was the evidence of progress in the face of challenging external forces more obvious than at BAX Global. Despite a weak global economy, the people of BAX took great strides to prepare to reap the benefits of an economic recovery. Expanding upon the cost initiatives begun in 2000, further fleet reductions were made in 2001. The result is an even leaner, more flexible BAX Global, which remains fully capable of serving its customers' transportation and logistics needs.

With worldwide economic conditions largely responsible for a decline of over $300 million of revenue in 2001, BAX Global was still able to build its market presence, serve its customers at record high levels, win major awards of new business and maintain an environment of teamwork, all while remaining steadfast in its discipline and initiative to reduce costs. BAX Global's leading position in Asia/Pacific is as strong as ever. Its operations in Europe are larger, more efficient and more of a market force than in the past. In the Latin America market, BAX Global is poised to become a much larger participant.

Brink's, Incorporated
After a difficult start to 2001, Brink's, Incorporated began to show signs of progress in the second half of the year, ending the year with good momentum for 2002. Once again, Brink's had strong cash flow in 2001, with operating profits before depreciation and amoritization of $154 million; however, operating margin and profit fell short of expectations.

At Brink's, management quickly identified problem areas and focused throughout the year on improving pricing and tightly managing operating costs and capital expenditures. Several key markets showed improvement in the second half of 2001. Pricing and costs showed improvement in the United States, and the Canadian operations also took steps to prepare for improved profitability in 2002. In Europe, a large part of 2001 was devoted to preparing for, and ultimately playing an integral role in, the successful distribution of the new euro currency. Brink's efforts were very effective and widely applauded by both our customer base and government agencies. The well-documented fiscal and social problems throughout Latin America challenged management there. With no obvious signs of economic improvement, these challenges will likely continue. However, we are committed to staying the course and to continuing to earn reasonable returns. Latin America offers an important opportunity for our services today and for tomorrow.

There will always be answers to changing market conditions and a few operational disappointments. What can never be replaced are the lives lost in the line of service. During 2001, 12 Brink's people were murdered. We were directly affected by the September 11th attacks on the World Trade Center with the loss of the life of one employee, Mr. Joseph [Frank] Trombino, and those of other family members of our people. We extended to them our heartfelt condolences and our resolve to carry on, and our people have done so with dedication and fervor. Nevertheless, these losses are a very painful reminder of the dangers around us and a call to never lose sight of the overriding goal of the Brink's organization: the safety of its employees. Investments in new technology, continuous review of procedures, training and audit continue to be paramount in providing the safest environment possible.

Brink's Home Security
Brink's Home Security also made progress in 2001. In addition to its perennially strong cash flow as represented by its over $100 million in EBITDA, 2001 marked another year of strong economic value generation. New installation growth was a solid 11% and monthly recurring revenue grew 7% to $19.2 million at year end.

One of the best indicators of the continued success of the Brink's Home Security business model is its historically lowest disconnect rate among the industry leaders. The rate remained at 7.6% for 2001. By paying close attention to the quality of growth and providing outstanding customer service, the Brink's Home Security team has found the key to long term success, where others have failed. "Customers for life" remains the focus of this service leader.

Brink's Home Security consistently has produced strong returns on capital and created economic value, but the organization also remains focused on returning to higher growth in operating results. To this end, mass marketing to the single-family homeowner remains the core of the Brink's Home Security model. However, with the development of additional distribution channels, the organization is pursuing new means to grow its high-quality customer base, while adding economic value and ultimately improving profitability.

Cash Flow
Strong cash flow is even more important in uncertain economic times and, in 2001, your company delivered once again. For the third year in a row, net cash provided by operating activities exceeded $300 million. Using this cash flow as a base, we were able to reduce total financings by approximately $115 million while continuing to invest in our businesses. Our balance sheet is solid and access to capital is secure. Cash flow will again be an important area of focus in 2002.

Coal
Much time and effort has been devoted to exiting the Coal business, but exiting in a prudent manner remains an important element of our strategy. Although the process has been challenging, we continue to move forward. We have experienced fluctuations in the coal market, realigned assets for sale in response to changing market dynamics and faced potential buyers whose interests conflicted with those of our shareholders. Nevertheless, our resolve has not wavered. We continue to work tirelessly to complete the exiting process as quickly as possible, consistent with an appropriate economic outcome.

It was a year of both successes and failures. Yet, I gratefully acknowledge the continued support and encouragement of our shareholders to the unwavering pursuit of our strategy — support which, I believe, was reflected in our 2001 share price performance despite a weak stock market. In light of the new world reality and all of the challenges that it presents, the progress achieved in 2001 was the result of our people working harder and smarter. I am proud of their accomplishments. I also appreciate the invaluable support and counsel provided to me by our Board of Directors.

Sincerely,

Michael T. Dan
Chairman, President
and Chief Executive Officer
The Pittston Company