Interim Results Presentation, Half Year to 31 December 2008 Greg Fitzgerald - Chief Executive

1. Interim Results Presentation, Half Year to 31 December 2008 Greg Fitzgerald - Chief Executive Frank Nelson - Finance Director

2. Disclaimer 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 2008, 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.

3. Agenda • Highlights • Financial Review • Operating Review • Key Strengths and Outlook Bermondsey Square, London

4. Highlights

5. Highlights • Operational strengths from hybrid model • Record profits and strong cash generation from construction • Net cash at period end • In compliance with bank covenants • Significant cost reductions achieved • Construction market more competitive • Construction order book 90% public and regulated

6. Highlights • Difficult housing market • £48m housing write down • Reduced land bank and number of stock properties • Geographic coverage maintained in Housebuilding • Excellent relationship with Homes and Communities Agency • New divisional management in place

7. Highlights Group Structure

8. Financial Review

9. Financial Review Highlights • Group revenue £774m, down 14% • Profit before tax • Pre-exceptional £11.2m profit, down 67% • Post-exceptional £37.5m loss • Earnings per share • Pre-exceptional 2.2p, down 66% • Post-exceptional (7.0)p • Net cash £2m (Dec 2007: £46m net debt) • Interim dividend 0.45p per share

10. Financial Review Financing • Total bank facility £432m • £300m until 2012 • £132m amortising to £90m in 2012 • Significant headroom over projected requirements • Projections within banking covenants • Substantial contract bonding facilities • Rigorous working capital management

11. Financial Review Income Statement * Profit from operations is stated before finance costs, exceptional items, amortisation and share of joint ventures’ interest and tax

12. Financial Review Exceptional loss • £48.7m exceptional loss taking account of: • Sites (including JVs) with negative margins • Further deflationary price assumptions • Abortive costs relating to conditional contracts • Reorganisation costs • Land write down equivalent to 14% of land bank

13. Financial Review Segmental Analysis: Profit from Operations *Profit from Operations

14. Financial Review Segmental Analysis: Profit Before Tax *PBT is stated before intangibles amortisation and JV interest and tax

15. Financial Review Finance Costs

16. Financial Review Balance Sheet Highlights * Includes £6m net pension deficit (Dec 2007: £19m, June 2008: £20m) **Includes land agreed & acquired, replanned, renegotiated

17. Financial Review Cash Flow Summary

18. Financial Review Land Payments Profile

19. Financial Review Balance Sheet/Debt Profile by Sector – Illustrative Only £m * Total net assets per B/S 303 Less intangibles (123) Net tangible assets 180 ** Assume average net debt £60m

20. Financial Review Cost Savings • Strong focus on business efficiency and cost savings • Housebuilding £19m • 4 day week • 43% head count reduction • Office and overhead savings • Construction £2.6m • Overhead savings • Group £3.4m • IT and communication costs • Corporate and central costs • Vehicle fleet expenses • National Insurances savings • Total targeted annualised savings £25m to meet current market conditions

21. Operating Review - Building

22. Operating Review - Building Highlights • Strong trading performance • Excellent cash generation • Successful completion of Highland & Northampton Schools PFIs • Key projects progressing well • Market conditions more competitive • Easing in supply chain Museum of Liverpool

23. Operating Review - Building Highlights • Selected for Scottish Health framework • Appointed on £103m St Pancras contract • 45% of workload secured for next year • 80% of order book within public and regulated sectors Wimbledon

24. Operating Review - Building Forward Order Book: February 2009 NB - Excludes £200m at preferred bidder stage - Excludes affordable housing contracting

25. Operating Review - Infrastructure

26. Operating Review - Infrastructure Highlights • Strong trading performance • Excellent cash generation • Renewables prospects good • Industry leading performance in Water • AMP 5 procurement process underway Spen Valley Waste Water Treatment Works, Yorkshire

27. Operating Review - Infrastructure Highlights • Whitelee Windfarm and A595 successfully completed • Good progress at Olympic Park and on M74 • 52% of workload secured for next year • Over 95% of order book within public and regulated sectors A595 Parton to Lillyhall, West Cumbria

28. Operating Review - Infrastructure Forward Order Book: February 2009 * Excludes AMP5 renewals

29. Operating Review - Investments

30. Operating Review - Investments Highlights • Investments in projects performing well • Bid decisions expected shortly • Belmarsh and Maghull prisons • Worcester Library & History Centre • Moray Schools, Scotland • Good pipeline of future projects in longer term Milburn Academy, Inverness

31. Operating Review - Affordable Housing and Regeneration

32. Operating Review - Affordable Housing and Regeneration Highlights • Excellent relationships with Homes and Communities Agency (HCA) • £28m of National Affordable Housing Programme grant • £10m (419 plots) HomeBuy Direct awarded • Secured first HCA site disposal Homes and Communities Agency

33. Operating Review - Affordable Housing and Regeneration Highlights • Speculative sales to Registered Social Landlords (RSLs) continuing • Re-planning schemes for current market • Contracting market subdued • Good position to gain accelerated and gap funding from HCA TR1, Truro, Cornwall

34. Operating Review - Affordable Housing and Regeneration Key Statistics: excluding spec sales to RSLs, including share of joint ventures

35. Operating Review - Housebuilding

36. Operating Review - Housebuilding Market Conditions • Difficult market conditions • Consumer confidence and mortgage availability key constraints • No new build premium • House price deflation from peak to trough of circa 25% • Sub-contract cost reductions from peak to trough circa 12% • Significant reduction in land prices • Cancellation rates stabilised Banstead Wood, Surrey

37. Operating Review - Housebuilding Highlights • Aggressive sales policy maintained • 43% reduction in head count • Successful implementation of 4 day working week • Geographical coverage maintained • Land spend and work in progress strictly controlled. Whittington’s Meadow, Nassington, Northants

38. Operating Review - Housebuilding Highlights • Renegotiations of major land acquisitions and existing planning approvals ongoing • Industry leading customer satisfaction maintained • Part exchange and stock levels at historically low levels Market Quarter, Chippenham, Wiltshire

39. Operating Review - Housebuilding Key Statistics: including share of joint ventures *Includes private housing, S106 and regeneration (excluding contracting)

40. Operating Review - Housebuilding Market Outlook • Continue to reduce exposure to the apartment market • Strong cash management being maintained • Prudent land procurement policy to continue • Well positioned to take advantage of opportunities • Evidence of investors returning to the market • Encouraging start to 2009 Watercolour, Redhill, Surrey

41. Key Strengths and Outlook

42. Key Strengths and Outlook • £432m banking facility negotiated in early 2007 - runs to 2012 • Continue to work within bank covenants • Low levels of debt with ability to gear up • Interim dividend declared • Construction • 90% in public and regulated sector • Industry leader in water • Upper quartile cash generation

43. Key Strengths and Outlook • Housebuilding • Maintained geographic coverage with southern bias • Low levels of stock • Leader in affordable housing • Greater revenues from lower land bank than key competitors • Well placed to take advantage of opportunities • Experienced management team

44. Interim Results Presentation, Half Year to 31 December 2008 Greg Fitzgerald - Chief Executive Frank Nelson - Finance Director