Investor Relations Presentation – February 2006 Investor Relations Presentation Half Year to 31 st December 2005

Investor Relations Presentation – February 2006 This presentation is being made only to and is directed at (a) persons who have professional experience in matters relating to investments falling within Article 19(1) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (b) any other persons to who it may otherwise lawfully be communicated, falling within Article 49(2) of the Order (all such persons being referred to as “relevant persons”). Any person who is not a relevant person should not act or rely on this presentation or any of its comments. The financial information set out in this document does not constitute the Company’s statutory accounts. Statutory accounts for 2005, which received an auditors’ report that was unqualified and did not contain any statement concerning accounting records or failure to obtain necessary information and explanations, have been filed with the Registrar of Companies. Disclaimer

Investor Relations Presentation – February 2006 Introduction Record results again through good operational performance Acquisition of Chartdale Homes Construction Margins at 2% Order book at £1.1b Housebuilding Record operating profits Margin maintained In hand position at all time high Affordable Housing Director appointed Sale and leaseback on two properties Strong platform for future growth Overview

Investor Relations Presentation – February 2006 Turnover up 7% at £372 million Profit before tax up 10% at £14 million Earnings per share up 10% at 4.4p Interim dividend up 17% to 0.7p per share Net debt of £8.9 million (2004 £10.1m) represents gearing of 15% ( %) NB – 2004 comparison based on restated IFRS figures Financial Review Highlights

Investor Relations Presentation – February 2006 Financial Review Summary Profit & Loss Account (£m) Dec 2004* (£m) Dec 2005 Profit before interest Interest(2.3) (2.0) Turnover Profit before tax Diluted earnings per share 4.4p4.0p Dividend per share0.7p 0.6p Interest Analysis Bank interest Interest on unwinding of discounted creditors Net return on liability of pension fund Total Interest * based on restated IFRS figures

Investor Relations Presentation – February 2006 Financial Review Dec 2004* Dec 2005 Construction Dec 2004 *Dec 2005 Group Turnover (£m) Profit/(loss) (£m) Housebuilding Group0.30.3(2.7)(2.1) Less net interest payable(2.3)(2.0) Profit before tax Segmental Analysis PPP Investments0.8-(0.5)(1.2) * based on restated IFRS Figure

Investor Relations Presentation – February 2006 Cash Flow Summary Financial Review Dec 2005 (£m) Increase in inventories and developments3.0(10.2) Decrease in land creditors(10.9)(3.7) Increase/(decrease) in trade and payables (1.8)(10.9) Net inflow Decrease in trade and other receivables Interest, tax, dividends, share capital & other movements(10.5)(9.4) Net debt brought forward(12.4)(12.1) From operating activities Dec 2004* (£m) Net debt carried forward (8.9)(10.1) * based on restated IFRS figures Decrease in retirement benefit obligation(1.2)(3.4)

Investor Relations Presentation – February 2006 Financial Review Dec 2004* (£m)Dec 2005 (£m) Net debt Shareholders’ funds Total capital employed Gearing15%21% Interest cover > 7 times > 7 times Balance Sheet, Financing * based on restated IFRS figures

Investor Relations Presentation – February % margin achieved ahead of schedule Affordable Housing expansion continues Increased presence in Water Financial Close Northampton Schools PFI Successful integration of Pentland Construction Key Highlights

Investor Relations Presentation – February 2006 Construction Profitability STABILISATIONGROWTHRECOVERY %* 1.1% (0.01)% %* * based on restated IFRS figures

Investor Relations Presentation – February 2006 Construction Forward Order Book 18Infrastructure Education Water Commercial Interiors Health Telecommunications Affordable Housing Rail Ground Engineering3 2 Market Sectors Turnover (£m) Half Year to Dec Total Work In Hand Non Price Competitive 90% Work In Hand (£m) Non Price Competitive Total

Investor Relations Presentation – February 2006 Construction Leading Framework Contractor Scottish Water United Utilities Anglian Water Water

Investor Relations Presentation – February 2006 Construction Acknowledged as education specialists Bedford Schools PFI handed over on time Caludon Schools PFI Phase 1 handed over on time Northampton Schools PFI – on site Solihull Building Schools for the Future – ITN Stage Education

Investor Relations Presentation – February 2006 Construction Current LIFT schemes at FC 2/3 Fourth Wave - selected on three schemes Potential future opportunities in Scotland Government Initiatives - Community Hospital Schemes Health

Investor Relations Presentation – February 2006 Profit growth by volume Order book exceeds £1billion Partnering culture integrated throughout business Profit margins now in upper quartile Construction Summary and Outlook

Investor Relations Presentation – February 2006 Northampton Closed – Construction commenced BSF Solihull - £75m ITN stage LIFT 4 th Wave ITN South East Essex South East Midlands Bury Tameside Glossop Community Hospital Hinckley - £30m Market Harborough - £30m BSF Birmingham - £60m First Wave Nottingham - £35m First Wave Investments PPP Investments

Investor Relations Presentation – February 2006 Housing Highlights Acquisition of Chartdale Ltd. Record profits and margins maintained Sales volumes at all time high Significant cost reductions achieved Excellent customer satisfaction results Strengthened ‘in-hand’ position Housebuilding

Investor Relations Presentation – February 2006 Negotiated, ‘bolt-on’ acquisition Well established regional housebuilder Substantial land bank c plots on 23 sites Acquisition on deferred payment terms 200 units per annum projected 95% of land bank for houses Housebuilding Acquisition of Chartdale Ltd.

Investor Relations Presentation – February 2006 Housebuilding Key Statistics 6 Months to December *Increase % Units Average Selling Price £ (11.0) Income per sq. ft. £ Turnover £m Margin % ROCE % (13.6) Sales in Hand Feb 06 £m Land bank Feb 06 units 3,800 2, Strategic land Feb 06 acres * based on restated IFRS figures

Investor Relations Presentation – February 2006 Market Conditions and Focus Challenging market, but encouraging start to 2006 Difficulties with planning system remain Highly competitive land market Expertise in affordable Housing Individually designed schemes and conversions Avoid consortium sites and high rise apartments Shortage in supply continues to underpin the market Housebuilding

Investor Relations Presentation – February 2006 Housebuilding Midas & Gerald Wood Homes Units 200 Average selling price £ Brownfield and conversion 87% Customer satisfaction 93% Two ‘Golds’ at the What House Awards

Investor Relations Presentation – February 2006 Housebuilding Stamford Homes Units 128 Average selling price £ Brownfield and conversion 51% Customer satisfaction 82%

Investor Relations Presentation – February 2006 Housebuilding Try Homes Southern Units 73 Average selling price £ Brownfield and conversion 100% Customer satisfaction 89% ‘Silver’ at the What House Awards

Investor Relations Presentation – February 2006 Housebuilding Try Homes Thames Valley Units 83 Average selling price £ Brownfield and conversion 100% Customer satisfaction 93% ‘Silver’ at the What House Awards

Investor Relations Presentation – February 2006 Housebuilding Summary & Outlook All business units performing well Land bank boosted by acquisition of Chartdale Exposure to apartments reduced Land and planning remain difficult Well placed to maximise opportunities in Affordable Housing Confident of achieving expansion plan

Investor Relations Presentation – February 2006 Affordable Housing Director of Affordable Housing appointed Work in hand up to £145m Strategic Alliances & Framework Agreements Strong Opportunities - East London Regeneration Mixed Tenure Expertise Opportunities for grant direct from Housing Corporation Considerable scope for growth Construction and Housebuilding Divisions

Investor Relations Presentation – February 2006 Strong financial position Construction: Maintain profit margins Increase turnover and cash generation Growth in chosen markets Housebuilding: Continuing to perform in challenging market Uncertain land and planning environment Proven business model Cost reduction plan Excellent opportunities in affordable housing Confidence in growth plans: Organic and by acquisition Summary and Outlook