Interim Results Presentation 2004 Galliford Try plc

Interim Results Presentation 2004


Galliford Try plc


Introduction David Calverley

Financial Review Frank Nelson

Construction Andy Sturgess

Housebuilding Greg Fitzgerald

Summary and Outlook David Calverley

Agenda


David Calverley - Chief Executive

Introduction


• Housebuilding:• A leading regional developer with strong local brands,

specialising in individually designed developments with expertise in brownfield, conversion and a strong focus on customer service.

Introduction - Strategy

• Construction• A market leader in the delivery of a complete construction

service through a partnership approach, with a strong sector focus.


Introduction – Strategic Review

• Plan For Growth - Construction

• Partnership approach & sector focus

• Build on recent successes in public and regulated sectors

• Emphasis on sustainable predictable profits

• Margins in medium term to be in upper quartile of 2%

• Plan for Growth - Housebuilding

• Build on success as strong regional developer

• Emphasis on mainstream market

• Expand unit sales by 50% over next 3 years

• Finance from internal resources


Frank Nelson – Finance Director

Financial Review


Financial Review – Summary Profit & Loss Account

For the half year ended 31 December 2003

(£m)

Dec 2002

(£m)

Dec 2003

Profit before interest (pre exceptional) 11.4 7.0

Interest (1.8) (1.5)

Turnover (including joint ventures) 356.4 299.9

Profit before tax (pre exceptional) 9.6 5.5

Exceptional charge - (2.0)

Profit before tax (post exceptional) 9.6 3.5

Earnings per share:

Pre exceptional 3.1p 1.7p

Post exceptional 3.1p 1.1p

Dividend per share 0.55p 0.5p


Financial Review – Segmental Analysis


Dec 2002 Dec 2003

Construction 268.7 226.2 2.0 (2.0)

Dec 2002 Dec 2003

Group Turnover (£m)(including joint ventures)

Profit/(loss) (£m)

Housebuilding 87.6 73.2 11.2 10.5

Group 0.1 0.5 (1.8) (1.5)

Exceptional charge - (2.0)

356.4 299.9 11.4 5.0

Less net interest payable (1.8) (1.5)

Profit before tax 9.6 3.5

£1.5m of the exceptional charge in the half year to 31 December 2002 is in construction and £0.5m is in group.


Financial Review – Cash Flow Summary

Dec 2003 (£m)

Depreciation and amortisation 0.9 0.9

Net land spend (6.0) (7.1)

Work in progress movement 2.1 (9.9)

Other working capital 3.8 (2.3)

Interest (1.2) (1.3)

Tax (2.1) (2.1)

Dividends (2.2) (2.2)

Net cash flow from operating activities 11.8 (13.5)

Movement in net debt 6.2 (22.3)

Capital expenditure (0.3) (0.9)

Other 0.2 (2.3)


Group operating profit (post exceptional) 11.0 4.9

Dec 2002 (£m)


Financial Review – Balance Sheet, Financing

Jun 2003 (£m) Dec 2003 (£m)

Net debt 11.6 17.8

Shareholders’ funds 65.5 59.7

Total capital employed 77.1 77.5

Gearing 18% 30%

Interest cover (post exceptional charge) 6.3 5.2


Andy Sturgess – Managing Director

Construction


-1

-0.8

-0.6

-0.4

-0.2

0

0.2

0.4

0.6

0.8

1

Dec-01 Jun-02 Dec-02 Jun-03 Dec-03

% Net Margin

0.4%

-0.3%

-0.9%

0.6%

0.8%

Construction - Profitability


Infrastructure

Health & Education

Business Units

Commercial

Interiors

PFI/PPP

Telecommunications

Affordable Housing

Rail

Ground Engineering

Market Sectors Ce

ntr

al

No

rth

So

uth

Pa

rtn

ers

hip

s

Co

mm

un

ica

tio

ns

Ro

ck

& A

llu

viu

m

Water

Growth >10% Growth 5-10% Growth 0-5% Decline 5-10%

Construction – Economic Forecasting


• Scottish Water

• AMP 4 Renewals

• Welsh Water

• United Utilities

• Anglian Water

• Yorkshire Water

Construction - Water


• LIFT Programme

• Liverpool & Sefton (£60m)

• Barnet, Enfield & Haringey (£32m)

• Coventry (£42m)

• DTC Frameworks

Construction - Health


• Bedford Schools PFI – On Site

• Caludon Castle School & Community College PFI Project, Coventry – Preferred Bidder

• Northampton PFI – One of Two (£100m)

• Birmingham Schools PFI 2 – One of Two (£55m)

• Building Schools for the Future

Construction - Education


• Frameworks Continue

• TOC’s

• Virgin Rail Framework

Construction - Rail


Construction – Affordable Housing

• Changes in Procurement Route

• PFI

• Joint Development

• Key Worker Accommodation


15.3 Infrastructure 48.0 42.0

35.7 Education 98.9 50.1

35.0 Water 213.6 213.6

63.8 Commercial 48.2 17.3

34.0 Interiors 24.2 20.1

13.5 Health 136.8 136.8

20.8 Telecommunications 6.5 6.5

27.2 Affordable Housing 28.5 27.6

17.2 Rail 65.6 65.6

6.2 Ground Engineering 3.3 3.3

Market SectorsTurnover (£m)

Half Year to Dec 03

268.7 673.6 580.1

Total Work In HandNon Price Competitive

86%

Work In Hand (£m)

Non Price Competitive

Construction – Forward Order Book

Total


• Sector Focus

• Earliest Involvement in Life Cycle of Project

• Collaborative Working

• Design Management

• Our People

• Risk Management

• Ability to Say No

Construction – Key Success Factors


Greg Fitzgerald – Managing Director

Housebuilding


Housebuilding – Strong Regional Brands

31% 39%

30%


• Increased profits

• Performance of Midas again equal to the very best in the industry

• Good progress with infrastructure works at Fairfield

• Margin enhancement measures introduced which will show significant savings

• Monthly performance measures proving effective

• Awards received recognising company performance

• Value of current order book 22% above last year

Housebuilding - Highlights


Housebuilding – Key Statistics

6 months to 31st Dec

2003 2002 Increase %

Units 367 318 15.4

ASP (£000) 228 206 10.7

Income per sq foot (£) 197 171 15.2

Operating Profit (£m) 11.2 10.5 6.7

Margin (%) 12.8 14.3 (1.5)

ROCE (%) 21.6 21.8 (0.2)

Turnover (£m) 87.6 73.2 19.7

Order book at Feb 04 (£m) 83.5 68.6 21.7

Land Bank - Units 2282 2380 (4.1)

Strategic Land – Acres 676 622 8.7


Housebuilding – Planned Growth

Units Completed

June 03

Targeted Numberof UnitsJune 07

South West Region 266 425

Stamford 285 375

Try Southern 93 225

Try Thames Valley 97 225

TOTAL 741 1250


• New management in place at Stamford

• Expertise in affordable housing

• Sustainable levels of house price inflation in the mainstream market

• Expansion plan agreed and being implemented

• Expect to achieve full year planned performance

Housebuilding - Summary


David Calverley - Chief Executive

Summary and Outlook


Summary and Outlook

• Plan for growth

• Experienced and ambitious management team

• Robust finances

• Stringent programme of cost control and risk management

• Construction

• Success in securing work in target markets

• On track with margin improvement

• Housebuilding

• Market conditions remain healthy

• Forward order book up 22% on last year

• Board confident of delivering increasing value to shareholders




Galliford Try plc

Documents

Interim Results Presentation 2004 Galliford Try plc