Investor Relations Presentation September 2002. INVESTOR RELATIONS PRESENTATION - SEPTEMBER 2002 Agenda Introduction David Calverley Chief Executive Highlights

Investor Relations Presentation

September 2002

INVESTOR RELATIONS PRESENTATION - SEPTEMBER 2002

Agenda

Introduction David Calverley

Chief Executive

Highlights “

Key Financials Frank Nelson

Finance Director

Construction George Marsh

Deputy Chief Executive

Housebuilding David Calverley

Chief Executive

Summary “

Preliminary Statement


Introduction/Overview

• Strategy for sustainable growth:

• Construction:

• A market leader in the delivery of a complete construction service through a partnership approach,

with a strong sector focus

• Housebuilding:

• A leading regional developer with strong local brands, specialising in individually designed

developments with an expertise in brownfield conversion

Introduction

1999 2000 2001 * 2002

Profit before tax (£m) Full year (*pre-exceptional)

Page 1


Highlights

• Financial:

• Turnover up 14% to £650 million (2001: £571 million)

• Profit before tax of £18 million up by 19% (2001 pre exceptional profit: £15.1 million)

• Earnings per share up 14% to 5.8 p (2001: 5.1 p)

• Final dividend of 1.0 p per share making total up 7% at 1.5 p for the year (2001: 1.4p)

• Borrowings of £12.9 million representing gearing of 24% (2001: borrowings £14.1 million - gearing 32%)

• Return on shareholders funds of 34% (2001: 35%)

• Operational:

• Record performance from housebuilding

• Acquisitions successfully integrated

• Joint Venture to develop Fairfield Hospital, near Letchworth

• 3 year joint venture contract from United Utilities

• Strong construction order book at £592 million

Highlights

Page 2


Key Financials

Page 3

Summarised Profit and Loss AccountFor the year ended 30 June 2002

2002 2001

£000 £000

Turnover 649,783 570,673

Operating profit 20,168 16,419

Interest (2,153) (1,293)

Profit before tax and exceptional items 18,015 15,126

Exceptional items - (10,212)

Profit before tax 18,015 4,914

Earnings per share (pre exceptional) 5.8p 5.1p

Dividend per share 1.5p 1.4p


Key Financials

Page 4

Segmental AnalysisFor the year ended 30 June 2002

2002 2001 2002 2001

£000 £000 £000 % £000 %

Construction 487,296 457,299 411 0.1 6,244 1.4

Housebuilding 161,959 111,380 22,487 13.9 12,810 11.5

Group 528 1,994 (2,730) (2,635)

Exceptionals - (10,212)

649,783 570,673 20,168 6,207

Less net interest payable (2,153) (1,293)

Profit before tax 18,015 4,914

Group Turnover(including joint venture)

Profit/(loss)


Key Financials

Page 5

Summarised Balance SheetAs at 30 June 2002

June June 2002 2001

£m £m £m £m

• Fixed assets and investments 14.5 14.1

• Developments

• Land 94.3 74.8

• Work in progress 32.8 36.9

• Others 1.4 128.5 1.6 113.3

• Stocks 0.4 0.3

• Debtors 111.3 102.4

• Net borrowings (including loan notes) (12.9) (14.1)

• Creditors (188.1) (172.0)

• Shareholders’ funds 53.7 44.0

• Gearing 24% 32%


Construction

• Strategy

• A market leader in the delivery of a complete construction service through a partnership approach with

strong sector focus

• Key Issues

• Good performance in areas of sector focus:

• Water United Utilities AMP 3 Framework £215 million JV

• Rail Framework contracts in Northwest and Midlands

• Affordable Housing 2200 units new build and refurb

• Telecomms 1000 cell sites

Expansion of design and rigging services

• Leisure Partnerships with Compass, Wimbledon, Bass

• Education 40 projects undertaken

• Piling Leader in Continuous Flight Auger Piling

• Poorer performance in older, competitively tendered, contracts

Page 6


Construction

Page 7

• Market Trends

• 5% + real growth in affordable housing, infrastructure and public sector

• Flat market in commercial and industrial

• Overall 2% real growth

• Emphasis on partnership and “best value”

• Order Book

• £592m forward order book

• 73% secured on value criteria

• Objectives

• Improve operating margin

• Exit areas of poor risk/reward

• Concentrate on areas of sector focus and partnership

• Cash generation

• Competitive advantage through best practice

Segmental Analysis of Order Book

Private Housing Public Housing Industrial Commercial

Water Road & Rail Ed & Health Other

11% (17%)2% (9%)

1% (-%)

20% (4%)

34% (7%)

19%

(45%)

6% (7%)7% (11%)


Housebuilding

2002 2001 Increase %

Units 899 780 15

ASP £000’s 177 142 25

Turnover £m 162 111 46

Margin %

ROCE

13.9

25%

11.5

18%

21

39%

Midas Try Stamford

256 units

ASP £248K

305 units

ASP £154K338 units

ASP £144K

S34%

Key Achievements: Increased volumes and selling prices Improved margins Successful integration of Gerald Wood/Knapp Homes Repositioning of Stamford Homes into higher value areas

Fairfield: Non-recourse joint venture Acquired 44 acre development Stamford to project manage entire site JV revenues expected to exceed £45m 106 units for Stamford

30%30%

40%

Page 8

Geographical Analysis

Key Statistics:


Housebuilding

• Order Book:

• Up 19% on last year at 234 units

• Outlook:

• Slower rate of house price inflation

• Planning challenges

• Strong underlying demand for new homes

• Opportunities for three brands to expand further

Land Bank:

• 1145 units acquired for £56m

• 2½ years supply

• 607 acres under option

2002 2001

Units 2,252 2,044

Value £m 94 75

Av Plot Cost 42 37

Land Bank

Page 9


Summary

• Construction - repositioning for growth through specific market sector focus

• Housebuilding – opportunity for strong regional brands to increase market share

• Short term growth more modest as construction refocuses. Confident of delivering

substantial growth going forward

Summary

Page 10

Documents

Investor Relations Presentation September 2002. INVESTOR RELATIONS PRESENTATION - SEPTEMBER 2002 Agenda Introduction David Calverley Chief Executive Highlights