PROFIT AND LOSS ACCOUNT

1
Interim Results Presentation Six Months to 31
December 2002
Thursday 6 March 2003
www.redrow.co.uk
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HIGHLIGHTS
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PROFIT ANALYSIS
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CAPITAL EMPLOYED
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STOCK
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CASH FLOW
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CASH FLOW
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NET ASSETS
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HOMES - TRADING PERFORMANCE
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HOMES - SALES PERFORMANCE
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HOMES - SALES PERFORMANCE
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HOMES - PRODUCT PROFILE
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HOMES - PRODUCT PROFILE
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HOMES - REGIONAL PROFILE
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COMMERCIAL DIVISION

• Sale of
• Optima at St. Davids Park 27,000 sq. ft.
  office
• Land at St. Davids Park
• Commercial elements at Whitworthwest

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COMMERCIAL DIVISION

• Second half
• Profit on completion of pre-let and pre-sold
  51,000 sq. ft. distribution warehouse at Western
  Approach to cover overheads

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CHIEF EXECUTIVES OVERVIEW

• Housing Market
• Construction
• Land
• Redrow Commercial
• Strategy

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SALES MARKET

• FUNDAMENTALS OF HOUSING MARKET REMAIN SOUND
• Planning policies continue to restrict supply
• Demographics continue to support increased demand
• Cost of borrowing likely to remain at low levels
• Increasingly ageing housing stock

However consumer confidence weakened by negative
media coverage and economic uncertainty
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SALES MARKET

• REDROW APPROACH
• Acceptance that Spring 2003 likely to be less
  buoyant than Spring 2002
• Programme of development launches throughout
  Spring market to promote Redrow
• Maintain emphasis on Group marketing in
  particular T.V.
• Forward sales position strengthened over the last
  18 months
• Focus on profit not turnover to maximise the
  value within the land bank

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SALES MARKET

• In first 8 weeks of 2003
• Visitor levels 12 ahead of last year
• Web site visits 8 ahead of last year
• Sales reservations 2 above 2002 levels
• Cumulative sales reached forecast legal
  completions two weeks ahead of 2002

Sales reservations exclude Altolusso
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SALES MARKET
Altolusso 292 apartments in Cardiff city
centre Scheme launched Wednesday 22nd January
2003
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SALES MARKET
155 sales achieved in first five days with a
sales value of 25m
Average price per sq. ft. 207 (excl. car parking)
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CONSTRUCTION

• BUILD COSTS
• Material price increases remain in line with
  general inflation
• Skilled labour resources remain under pressure
• Centralised project management team controlling
  City schemes and commercial developments
• CML INITIATIVE
• Introduction in April 2003
• Implications need pro-active approach Redrow
  running in parallel since July 2002

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FRAMING SOLUTIONS

• EXISTING SCHEMES
• Ebbw Vale successfully completed
• Pengam Green, Cardiff

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FRAMING SOLUTIONS

• NEW SCHEMES
• Orders placed for
• Collingwood Place, Gloucester
• The Paddocks, Wirral
• Further schemes identified for controlled
  introduction of steel frame to other companies

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FRAMING SOLUTIONS

• Existing plant and machinery successfully
  relocated to new facility at Swadlincote
• New roll forming machine in construction

• New plant programmed to be on line in Q2 2003
• First year Framing Solutions costs in line with
  expectations

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FRAMING SOLUTIONS

• PROGRESS
• Additional square footage generated on equivalent
  house types due to Part L wall construction
• Gain on average Harwood home 22 sq. ft. en
  suite shower room

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HOMES - LAND BANK ANALYSIS
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HOMES - LAND WITH PLANNING
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LAND BANK

• Average selling price of 13,700 plots at December
  2002 estimated at approximately 147,500
• Forward land contribution remains important
• 35 of purchases in H1 delivered from forward
  land
• Effectiveness of land bank retained
• 03/04 - 100 of anticipated legal completions
  are on owned land
• 04/05 over 95 of anticipated legal
  completions are on owned or controlled land
• Planning and Compulsory Purchase Bill

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LAND BANK

• Low average plot cost and land to sales
  percentage reflects
• Long term strategy to land acquisition with
  benefits from forward land
• Brownfield land represents over 65 of land bank
• In the City schemes represent 15 of land bank
• Margins/ROCE
• Forward land costs represent 0.5 of turnover
• Operating margins remain towards top of sector
• Low plot cost benefits ROCE
• Focus on margin and ROCE

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REDROW COMMERCIAL

• Profitability largely secured for full year to
  June 2003
• Future contribution from
• St Davids Park
• Evolution 13,000 sq. ft. nursery office units
• Vista 30,000 sq. ft. office development
• Buckshaw Village, Phase 1 80,000 sq. ft.
  distribution units
• Western Approach 51,000 sq. ft. distribution
  warehouse
• Altrincham, Phase II 21,000 sq. ft. office
  development

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STRATEGY

• Maintain sales and marketing focus
• Strong forward sales position
• Marketing of Redrow brand
• New developments to maintain sales momentum
• Focus product to appeal to wide audience of
  customers

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STRATEGY

• Controlled introduction of steel frame
  construction to take advantage of efficiencies
• Maintain long term approach to land
• Southern Region refocused to enhance future
  growth

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GROUP OBJECTIVE

• TO DELIVER SHAREHOLDER VALUE
• Manage business to produce sustainable and
  profitable growth
• Reviewed level of dividend to reflect inherent
  profitability of the Group
• Maintain historic split between interim and final
  dividend
• Provide higher reference level for our
  progressive dividend policy

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Interim Results Presentation Six Months to 31
December 2002
Thursday 6 March 2003
www.redrow.co.uk
37
CALENDAR

• Update on 3rd July 2003
• Product marketing strategy
• Land and planning
• Steel frame construction
• Current trading
• Preliminary Results on 9th September 2003
  (Provisional)
• Steel frame visit in Autumn 2003
• Swadlincote visit
• Redrow site

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Interim Results Presentation Six Months to 31
December 2002
Thursday 6 March 2003
www.redrow.co.uk
39
RETURN ON CAPITAL EMPLOYED
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HOMES ASP PROFILE
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HOMES LAND WITH PLANNING PRODUCT PROFILE
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HOMES LAND WITH PLANNING REGIONAL PROFILE
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FIVE YEAR SUMMARY(RESTATED FOR FRS 19)
REDROW plc