disclaimer the information in this presentation does not constitute an offer to sell or an...

Disclaimer

The information in this presentation does not constitute an offer

to sell or an invitation to buy shares in George Wimpey Plc or

any other invitation or inducement to engage in investment

activities.

Past performance cannot be relied upon as a guide to future

performance

2

George Wimpey PlcInterim Resultsfor the 26 weeks to 3 July 2005

Tuesday 6 September 2005

Welcome

John Robinson

Chairman

Agenda

H1 Financial Review Andrew Carr-Locke

UK Business Review Pete Redfern

US Business Review Peter Johnson

Strategy and Outlook Peter Johnson

5

H1 2005 financial review

Andrew Carr-Locke

Group Finance Director

IAS reconciliationIncome statement

7

156.5158.0 181.8181.6

(34.2)(27.3) (27.9)(23.1)

122.3130.7 153.9158.5

(37.9)(41.0) (47.8)(49.1)

84.489.7 106.1109.4

Operating profit

Interest

PBT

Tax

Profit after tax

IASUK GAAP* IASUK GAAP*

H1 2005 H1 2004£m

*Consistent 2004 UK GAAP basis

First half results

*restated for IAS **last 12 months

Turnover 1,190 -2%1,220

Operating profit 156.5 -14%181.8

Interest charge (34.2) +23%(27.9)

Profit before tax 122.3 -21%153.9

Earnings per share 21.5p -22%27.7p

NAV per share 348p +52p296p

Dividend per share 5.7p +10%5.2p

ROACE** 22.7% 25.6%

H12005

ChangeH1

2004*£m

8

Segmental analysis

*Exchange rate in 2005 $/£=1.87, 2004 $/£=1.81

GWUK 858 -10% 107 -32% 12.4% 16.4%

Morrison Homes* 332 +24% 55 +64% 16.4% 12.4%

Other - - (5) -

Total 1,190 -2% 157 -14%

£m Change £m ChangeH1

2005H1

2004

TurnoverOperating

profit Operating

margin

9

First half completions

4,154 -11% £194,000 -GWUK private

422 -6% £88,000 +2%GWUK affordable

4,576 -10% £185,000 -GWUK

1,996 +16% $302,000 +9%Morrison Homes

6,572 -3%GROUP TOTAL

No Change £ / $ Change

Completions Ave selling price

10

Cash flow summary

*restated for IAS

H12004*

H1 2005£m

Operating profit

Land spend

Land realisations

Other working capital movements

CASH INFLOW FROM OPERATIONS

182157

(462)(502)

284284

(137)(134)

(133)(195)

Tax

Dividends

Exchange rate effects

Other movements

INCREASE IN NET DEBT

(55)(55)

(16)(41)

5(31)

(3)(11)

(225)(360)

Interest (23)(27)

11

Balance sheet - net assets

30 Jun2004*

3 Jul2005

Fixed assets and joint ventures

Land

Land creditors

Other net operating assets

Tax and provisions

Net pension deficit

TOTAL NET ASSETS EMPLOYED

2945

1,7672,136

(147)(240)

451546

(63)(94)

(129)(145)

1,9082,248

£m

* restated for IAS 12

Balance sheet -financing

* restated for IAS

Shareholders’ funds £m 1,367 1,154

3 Jul2005

30 June2004*

Net debt £m 881 754

Capital employed £m 2,248 1,908

Gearing 64% 65%

Interest cover last 12 months 7.1x 7.6x

Cash interest cover last 12 months 9.4x 9.8x

13

Financial summary

Results now published under IAS

Challenging market conditions in the UK

GWUK margins down 4.0pp, volumes down 10%

Continued strength in the US

Morrison margins up 4.0pp, volumes up 16%

Group PBT down 21% at £122m

Gearing in line with prior year at 64%

ROCE at 22.7% remains healthily above cost of capital

Half year dividend increased by 10% to 5.7p 14

Impact of IASInterest charge – net payable

H1 2005£m H1 2004

UK GAAP basis*

Interest charge on discountedpension liabilities under IAS 19

Reallocate JV interest

Interest charge ondiscounted land creditors

Notional interest expensebooked to cost of inventory

Movement on interestrate derivatives

IAS basis

(27.3) (23.1)

(4.2) (4.0)

0.6 -

(3.1) (1.4)

1.1 0.6

(1.3) -

(34.2) (27.9)

15*Consistent 2004 UK GAAP basis

Financial summary

Results now published under IAS

Challenging market conditions in the UK

GWUK margins down 4.0pp, volumes down 10%

Continued strength in the US

Morrison margins up 4.0pp, volumes up 16%

Group PBT down 21% at £122m

Gearing in line with prior year at 64%

ROCE at 22.7% remains healthily above cost of capital

Half year dividend increased by 10% to 5.7p 16

UK business review

Pete Redfern

Chief Executive, GWUK

Financial summary

Total completions

Private completions

Private ASP

Turnover £m

Gross margin %

4,177 4,560 399 533

3,793 4,220 361 423

£182,900 £183,600 £316,400 £308,100

739.3 809.3 119.1 142.9

24.3% 26.8% 20.3% 23.1%

George Wimpey

H1 2005 H1 2004 H1 2005 H1 2004

Laing Homes

Operating profit £m

Operating margin %

106.7 156.2

12.4% 16.4%

GWUKH1 2005 H1 2004*

* restated for IAS18

UK market conditions

Market continues to be

tough but steady

very price sensitive and incentive led

Second hand market (down 30%) affecting new build sales and

conversion rates.

Summer visitor levels are slightly better than last year

cancellation rates below peak in November 2004

Geographically no clear difference in market conditions,

in the South slightly more confidence in the short term

Apartment market is particularly price sensitive - occupier and investor

19

Ave weekly sales ratesGWUK 2003 – 2005

0

0.2

0.4

0.6

0.8

1

1.2

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2003 2004 2005

Sal

es p

er s

ite

per

wee

k

20

Net sales prices on reservationsGWUK 2003 – 2005

140

150

160

170

180

190

200

210

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2003 2004 2005

AS

P a

chie

ved

on

res

erva

tio

ns

£000

s

21

Price points

0

200

400

600

800

1000

1200

1400

£0-50k £51-100k £101-150k £151-200k £201-250k £251-300k £301-500k £500k+

Price band

2005

2004

To

tal c

om

ple

tio

ns

22

Product mix

Apartments

2 / 3 bed houses

4 / 5 bed houses

H12005

H22004

H12004

34% 29% 32%

32% 29% 35%

34% 42% 33%

100% 100% 100%

PD completions %

23

Margin reconciliation

100% 100% 100%-Turnover

26.5% 23.9% 24.2%(2.6)%Land costs

49.7% 49.7% 49.5%0.0%Build & other costs

4.7% 3.8% 3.3%(0.9)%Direct selling expenses

6.6% 6.1% 5.2%(0.5)%Overhead costs

12.4% 16.4% 17.8%(4.0)%Operating profit

ChangeH1 2005 H1 2004 FY 2004

24

Build Costs

Underlying cost pressures remain, pressure on labour rates

and availability has reduced

Material cost pressure remains high, driven by higher energy

and other input costs, partly balanced by scale

Cost management program enabled us to hold build costs

Confident of £20m cost saving program, c.£17m impacts on

2005 with much of the balance locked up in WIP and build

Key initiative is rationalisation of house typesSeptember 2004 - every business had own house designs

no core national range since 2001

today - a ‘preferred range’ of 30 products 25

Landbank

North

Midlands

South

City

Laing

TOTAL

15,555

12,360

6,258

16,648

3,559

54,380

4,784

5,329

-

6,218

-

16,331

Jun 2005 Jun 2004 Jun 2005 Jun 2004

Owned andcontrolled plots

Long term acres

15,630

12,147

4,648

16,078

2,398

50,901

4,908

5,497

-

7,720

-

18,125

26

Planning approvals achieved on 14,500 plots in last 12 months

Land cost

Cost per plot of 2005 acquisitions is higher due to Laing / South

mix

Continued focus on larger sites where competition slightly

reduced and scale gives advantage

Significant skills developed since 2003 on partnership schemes

like Bracknell and Dartford

ASP £000s

Cost per plot £000s

H1 2005 Landbank

Land value % ASP

194.5 194.3

52.3 54.0

26.6% 27.8%

For PD ownedplots only

27

Bracknell case study

Existing planning consent - 584 PD units, 146 affordable unitsPhased land payment terms, above standard gross marginPursuing enhanced planning application, including 38% affordable

provisionc.£260k average selling price

Mix includes

c.20% 1&2 bed apartments

2-5 bed houses

EcoHomes ‘Very Good’

Anticipated site start Feb 06 based on existing consent

28

Dartford case study

794 private development units, 340 affordable unitsPhased land payment terms, above standard gross margin39% apartments across the developmentc.£230k average selling price

Design codes for integrated mixed use developmentLand acquired fully serviced

‘Fastrack’ - dedicated

transport service

Anticipated site start mid 06

29

Summary

Challenging first half

market tough, use of incentives essential

order book at 90% of expected full year volumes, margins

below first half

build cost pressures significant but balanced by savings

Outlook for H2

early to call autumn market

balance between customer demand and supply availability is

critical factor

cost pressures remain but mitigated by savings

operating margins improved by volume weighting30

US business review

Peter Johnson

Group Chief Executive

US housing marketcontinued healthy economic data…

Employment

240,000+ new jobs in July, 169,000 in August

unemployment at four-year low

Consumer confidence

up to 105.6 in August (vs. 106.2 max 2004 and 2005)

30-year mortgage rates

5.71% - still near record lows

32

US housing marketunderpinned by demographics

Source: CSFB

70.0

69.268.6

68.368.067.5

66.966.4

65.765.4

65.1

64.164.064.164.163.9

62%

63%

64%

65%

66%

67%

68%

69%

70%

71%

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2010E

A homeownership rate of 70% in 2010 would imply the creation of

c.1.28m households pa from 2004-2010, compared to the 800,000

created pa from 1999-2004

US Homeownership rates

33

Morrison HomesH1 performance

More outlets open in continuing businesses

1 Jan = 89 outlets 1 Sep = 98 outlets

Visitor rates per site

Ave selling price

Sales rates per site

H1 2004H1 2005 Change

18.219.6 +8%

$278,000$302,000 +9%

1.081.15 +6%

34

Financial summary

Legal completions

Revenue $m

Ave selling price

Operating profit $m

Operating margin %

H1 2004*H1 2005 Change

1,7141,996 +16%

484621 +28%

$278,000$302,000 +9%

60.3101.9 +69%

12.4%16.4% +4.0pp

* restated for IAS35

Margin performance

Margins above these levels in sales proceedingImplied operating margin LPEs year to date = 16.5%

H1 cost inflation c.7% annualised (Source: CSFB)Some labour and material shortages in strongest markets

Gross margin

Operating margin

27.1%

16.4%

24.0%

12.4%

H1 2005 H1 2004

+3.1pp

+4.0pp

Change

36

Land

Land in place for growth in 2006 and largely in place for 2007Good regional balance

Plots owned / under option

Plots controlled

Total landbank

19,661

3,058

22,719

18,892

2,687

21,579

17,456

2,606

20,062

Jun 05 Dec 04 Jun 04

Net additions (plots, last 6 months)

Land spend $m (last 6 months)

2,765

156

4,144

174

3,866

108

37

Progress on strategy:four platforms for growth

Focus on growing markets

major beneficiaries of underlying trends

Establish satellites in neighbouring markets

land in place to support 2006 growth in Reno, Ft Myers and

Daytona Beach

Product development

continued success of townhome product

Performance improvement in Texas and exit from Atlanta

Texas completions + sales proceeding up 53% in H1

Atlanta exit largely complete 38

Morrison Homes marketsmajor beneficiaries of underlying trends

California

Florida

Texas

Arizona

Colorado

TOTAL

Total US

Morrison Markets

321

262

185

116

58

941

2,947

32%

1

2

3

6

18

-

JobGrowth

last 12 mths

Rank

104

106

82

43

21

355

887

40%

2

1

3

6

12

-

SFPermitsH1 2005

Rank000s

39

Morrison Homes marketsmajor beneficiaries of underlying trends

California

Florida

Texas

Arizona

Colorado

TOTAL

Total US

Morrison Markets

321

262

185

116

58

941

2,947

32%

1

2

3

6

18

-

JobGrowth

last 12 mths

Rank

104

106

82

43

21

355

887

40%

2

1

3

6

12

-

SFPermitsH1 2005

Rank000s

1,004

1,954

780

528

184

4,450

Morrisoncompletions

last 12 mths

40

Progress on strategy:four platforms for growth

Focus on growing markets

major beneficiaries of underlying trends

Establish satellites in neighbouring markets

land in place to support 2006 growth in Reno, Ft Myers and

Daytona Beach

Product development

continued success of townhome product

Performance improvement in Texas and exit from Atlanta

Texas completions + sales proceeding up 53% in H1

Atlanta exit largely complete 41

Summary

Excellent first half performance

visitor levels, sales rates, selling prices all up

Strongly placed for second half

94% sold or completed for 2005

order book margins and prices above first half

volumes may be held back by materials shortages

Well-positioned for continued growth

land already in place to support continuing volume growth in

2006 and largely in place for 2007

42

Strategy and outlook

Peter Johnson

Group Chief Executive

Strategy Market background

UK

underpinned by continuing supply shortfall

price growth likely to be limited

opportunities at lower price points

US

underpinned by demographics and economy

remains strong with wide regional variations

will come off peak but remain at historically high levels

44

Strategy

UK - focus remains on volume growth

plans in place to deliver through

expanding existing regions

new Laing regions

new George Wimpey satellitesGovernment initiatives offer potential for new businessimplementation depends on market and land prices

US - sustained volume growth

“four platforms” growth plan in placeland and detailed business plans in place to support growththese plans could deliver 10,000 unit business within 5 years

45

Outlook

UKcurrent sales rates ahead of same period 2004premature to draw conclusions on autumn marketif sales rates sustained, full year total volumes similar to 2004 by 1 September 90% completed or in order book margins in order book below first half actuals

USvisitor and sales rates remaining strongfull year volumes still expected to be up c.10% small volume risk from materials and labour shortagesby 1 September 94% completed or in order bookmargins and prices in order book above first half actuals

46

George Wimpey PlcInterim Resultsfor the 26 weeks to 3 July 2005

APPENDIX

Impact of IASBalance sheet

48

45 44 29 29

2,136 2,143 1,767 1,771

(240) (244) (147) (151)

547 544 451 452

(94) (103) (63) (69)

Fixed assets & JVs

Land

Land creditors

Other current assets*

Tax & provisions

IAS UK GAAP IAS UK GAAP

H1 2005 H1 2004

(145) - (129) -Net pension deficit / SSAP 24 prepaid

2,248 2,384 1,908 2,032TOTAL NET ASSETS EMPLOYED

£m

*Primarily elimination of interim dividend for IAS

Group reservations

GWUK private

GWUK affordable

GWUK TOTAL

US TOTAL

GROUP TOTAL

5,936

1,201

7,137

2,804

9,941

6,641

835

7,476

2,932

10,408

321

-

321

93

414

294

-

294

104

398

0.71

-

-

1.16

-

0.87

-

-

1.08

-

H12005

H12004

Reservations Ave sites Per outlet /per week

H12005

H12004

H12005

H12004

49

H12005

H12004

H22004

2004full year

GWUK -turnover analysis

Private - volume

ave price £000s

4,154 4,643 6,631 11,274

194.5 194.9 192.4 193.5

turnover £m 808 905 1,276 2,181

Affordable - volume

ave price £000s

422 450 508 958

87.7 85.9 92.5 89.8

turnover £m 37 39 47 86

Other turnover 13 8 26 34

TOTAL £m 858 952 1,349 2,30150

GWUK - margin analysis

Gross profit £m

Gross margin %

Selling expenses £m

Overhead costs £m

OPERATING PROFIT £m

Operating margin %

203.7

23.7%

(40.5)

(56.5)

106.7

12.4%

250.0

26.2%

(36.2)

(57.6)

156.2

16.4%

352.8

26.1%

(39.8)

(59.4)

253.6

18.8%

602.8

26.2%

(76.0)

(117.0)

409.8

17.8%

H12005

H12004*

H22004*

2004full year*

51* restated for IAS

GWUK -PD product mix

H12005

H22004

H12004

2004full year

Apartments

2 / 3 bed houses

34% 29% 32% 31%

32% 29% 35% 32%

4 / 5 bed houses 34% 42% 33% 37%

100 100 100 100

Completions %

52

GWUK -PD price mix

£0 – 50k 0 8

£51 – 100k 162 344

£101 – 150k 1250 1332

£151 – 200k 1325 1400

£201 – 250k 792 831

£251 – 300k 311 323

£301 – 500k 268 357

£500k + 46 48

H1 2005 H1 2004

Total 4,154 4,643

0%

4%

30%

32%

19%

8%

6%

1%

100%

0%

7%

29%

30%

18%

7%

8%

1%

100%

Completions % Completions %

53

GWUK -PD activity analysis

Ave house size sqft

Ave selling price £ / sqft

H12004

2004full year

1,069 1,033

182 187

H22004

1,008

190

H12005

1,015

192

54

GWUK -PD geographic mix

Legals

H1 2005 H1 2004

LegalsSizesqft

ASP£000

Sizesqft

ASP£000

Legals

H2 2004

Sizesqft

ASP£000

North

Midlands

South

Laing

1,205 1,084 172 1,459 1,150 169

1,307 979 168 1,593 1,033 173

1,202 970 206 1,055 1,036 212

361 1,129 316 423 1,088 308

2,123 1,095 171

1,983 953 166

1,843 958 204

506 1,149 329

City 79 713 242 113 776 267 176 699 237

Total 4,154 1,015 195 4,643 1,069 195 6,631 1,008 192

55

GWUK -landbank by region

Owned andcontrolled plots

June2005

June2004

Long term acres

June2005

June2004

North

Midlands

South

Laing

15,555 15,630

12,360 12,147

16,648 16,078

6,258 4,648

4,784 4,908

5,329 5,497

6,218 7,720

- -

City 3,559 2,398 - -

Total 54,380 50,901 16,331 18,125

56

GWUK -short term land

H12005

H12004

H22004

2004full year

OWNED - Start of period

Net additions

37,222 33,559 34,191 33,559

7,138 5,725 10,170 15,895

Legal completions (4,576) (5,093) (7,139) (12,232)

End of period

CONTROLLED

39,784 34,191 37,222 37,222

14,596 16,710 13,897 13,897

TOTAL LANDBANK 54,380 50,901 51,119 51,119

57

GWUK -owned land

Plots

H1 2004 H1 2005

PlotsCost perplot £k

Value£m

Opening landbank 33,559 44.6 1,49737,222 45.6 1,698

Additions 5,725 47.6 2727,138 52.3 373

Completions (5,093) (44.6) (227)(4,576) (47.9) (219)

End of period 34,191 45.1 1,54239,784 46.6 1,852

Short term Cost perplot £k

Value£m

Long term Acres Value £mAcres Value £m

End of period 18,125 6116,331 49

58

H12005

H12004

H22004

2004full year

Morrison Homes -turnover analysis

Volume

Ave selling price $000s

1,996 1,714 2,708 4,422

302 278 296 289

Turnover $m 603 476 801 1,277

Other turnover 18 8 5 13

TOTAL $m 621 484 806 1,290

59

Morrison Homes - margin analysis

Gross profit $m

Gross margin %

Selling expenses $m

Overhead costs $m

OPERATING PROFIT $m

Operating margin %

168.3

27.1%

(31.6)

(34.8)

101.9

16.4%

116.4

24.0%

(26.7)

(29.4)

60.3

12.4%

200.5

24.9%

(37.3)

(35.2)

128.0

15.9%

316.9

24.6%

(64.0)

(64.6)

188.3

14.6%

H12005

H12004*

H22004*

2004full year*


Morrison Homes -price mix

$0 – 200k 390 344

$201 – 250k 395 442

$251 – 300k 332 318

$301 – 350k 265 281

$351 – 400k 215 190

$401 – 450k 172 75

$451 – 500k 128 20

$500k + 99 44

H1 2005 H1 2004

Total 1,996 1,714

19%

20%

17%

13%

11%

9%

6%

5%

100%

20%

26%

19%

16%

11%

4%

1%

3%

100%

Completions % Completions %

61

Morrison Homes -activity analysis

Ave house size sqft

Ave selling price $ / sqft

H12004

2004full year

2,409 2,386

115 121

H22004

2,371

125

H12005

2,322

130

62

Morrison Homes -geographic mix

H12005

H12004

H22004

2004full year

West

Southeast

460 402 728 1,130

932 816 1,276 2,092

Southwest 604 496 704 1,200

TOTAL 1,996 1,714 2,708 4,422

West

Southeast

428 372 413 398

282 260 263 262

Southwest 237 231 234 233

TOTAL 302 278 296 289

Average selling price

Completions

63

Morrison Homes - regional performance

Turnover

H1 2005$m

H1 2004$m

153204

215266

117149

-2

West

Southeast

Southwest

Corporate

Total 484621

H1 2005$m

H1 2004$m

32.1

24.9

9.3

(6.0)

Operating profit*

60.3

Operating margin

H1 2005%

H1 2004%

21.0%

11.6%

8.0%

-

12.4%

56.5

39.2

16.8

(10.6)

101.9

27.7%

14.8%

11.3%

-

16.4%


Morrison Homes - short term land

H12005

H12004

H22004

2004full year

Start of period

Net additions

18,892 15,304 17,456 15,304

2,765 3,866 4,144 8,010

Legal completions (1,996) (1,714) (2,708) (4,422)

End of period

End of period

19,661 17,456 18,892 18,892

3,058 2,606 2,687 2,687

TOTAL LAND BANK 22,719 20,062 21,579 21,579

LAND SPEND $m 156 108 174 282

OWNED AND OPTIONS

CONTROLLED

65

disclaimer the information in this presentation does not constitute an offer to sell or an...

Documents