GEORGE WIMPEY PLC

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GEORGE WIMPEY PLC

GEORGE WIMPEY PLC

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2000 Interim Results

GEORGE WIMPEY PLC

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2000 1st half results

2000 1999 % Change

Revenue £m 694 622 +12

OperatingProfit £m

58.6 33.4 +75

Profit BeforeTax £m

48.0 27.9 +72

Earnings pershare p

9.9 6.0 +65

Dividend pershare p

2.65 2.3 +15

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GEORGE WIMPEY PLC

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First half results

• Underlying Operating Profit up 57% to

£58.6m

• UK Operating profits up 72%

• UK Operating margins up 3.5% to 10.2%

• Underlying Profit before tax up 67% to

£48.0m

• Interim Dividend up 15% - covered 3.7 times

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First half results

• No exceptional profits

• Interest cover of 5.5 times

• Tax rate 24%

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First half cash flow

• Cash outflow of £146m (1999: £112m)

• End June gearing unchanged at 55%

• Land spend up 46% to £272m

• Unchanged working capital

• Targeting 35 - 40% year-end gearing

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Balance sheet

Over last 12 months:

• Net debt up £46m to £334m

• Shareholders funds up £81m to

£611m

• Return on Equity 17.0%

• Net Assets up 22p to 166p

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Housing revenue

Legals Revenue

No. % Change £m % Change

Wimpey :PD 2396 -10 233 +8

:Social 208 -2 10 -9

Total 2604 -10 243 +8

McLean 2393 +1 289 +19

UK Total 4997 -5 532 +13

Morrison 947 -5 141 +21

GroupTotal

5944 -5 673 +15

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Operating profits

£m 2000 1999 % Change

Wimpey Homes(pre write-off)

20.6 12.3 +67

McLean 33.8 19.3 +75

Morrison Homes 7.8 7.2 +8

Corp/Other (3.6) (1.4) -

TOTAL 58.6 37.4 +57

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Wimpey Homes

• Average size +6% - Detached 30%

• Average selling price £97,000 +21%

• Current selling price £108,000

• Gross and Operating margins +3.1%

• End June sales proceeding £+18%

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McLean Homes

• Average size +3% - More detached

• Average selling price +17% to £120,000

• Gross margins up 2%

• Operating margins +3.8%

• End June sales proceeding £+1%

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Morrison Homes

• Important corporate activity

• Average size up 8% to 2400 sq. ft.

• Average selling price +19% to $224,000

• Current selling price over $230,000

• End June sales proceeding $+26%

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Land

Wimpey McLean Morrison

Land Spend £m 106 104 52*

% Increase +89 +16 +45

Short-term Plots 17350 15950 11080

Increase sinceDecember

+450 -250 +2580

* Includes Southlife land of £11m

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Financial summary

• Excellent first half - PBT +72%

• Significant improvement in UK

margins

• Sizeable land spend to lengthen land

banks

• Strong interest and dividend cover

• Very good second half in prospect

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GEORGE WIMPEY PLC

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Key StrategyDrive E.P.S. by:-

• 50% UK Revenue Growth

• 100% USA Revenue Growth

• Group Operating Margin of 10% by 2003

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Key StrategyDrive E.P.S. by:-

• 50% UK Revenue Growth– Target Growth = 8.5% pa.

– Growth Year 1 = 13%

– Growth 1st Half Year 2 = 13%

• 100% USA Revenue Growth– Target Growth = 15% pa.

– Growth Year 1 = 18%

– Growth 1st Half Year 2 = 17%

• On course to achieve Group Operating Margin of 10% by 2003

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UKMarket Status

• Slowdown needed - Affordability• Slowdown commenced second quarter

• Gross Margin holding• Temporary correction?• Strong fundamentals

Sales rate variance

Wimpey McLean

Q1 -2% -3%

Q2 -10% -8%

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USAMarket Status

• USA market slowed as expected• Not worsening

• Gross Margin holding• Overall satisfactory market

Sales rate variance

Q1 -11%

Q2 -3%

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Progress on declared goals

For Wimpey:• 10% operating margin - achieved early• £1000 cost reduction - achieved• CWP implementation - achieved• Raise %age detached - on target

For Morrison:• Develop expansion programme whilst retaining

acceptable returns - on target with the acquisition of Southlife and the disposal of SE Florida

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Initiatives going forward

• Renewed impetus on build cost

reduction

• Development of IT

– B2C

– B2B

• Fully manufactured housing

• PPG 3

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Long Term LandGross Acres

1996 1997 1998 1999 2000 (Q2)

5,100 8,450 9,200 10,150 11,000

The Freehold / Option balance

Gross Acres % Lock Up £m %

Freehold 2,500 23 23 58

Option 8,500 77 17 42

Total 11,000 100 40 100

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Land

Long Term Land

• On track to deliver 20% of completions

• Committed to deliver 1/3 of completions

Short Term Land

• Adequate short term land banks

• Brownfield sites increasing

• Land prices stabilising

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Status to Sunday 3rd September 2000

99/00% SalesVariance

% Varianceto 99

revenue

Wimpey Homes -8% -2%

McLean Homes -7% +1%

MorrisonHomes

+13% +11%

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Summary & Outlook

2000• First half of real progress• Strong improvement in UK margin• Land spend up 50%• Further progress on long term land• Market slowing but 2000 will be strong• Second year in row we will beat targets• Major step towards our 2003 goal of 10%

Group Operating Margins

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Summary & Outlook

Outlook

• Market slowdown expected to be soft

• Fundamentals sound

• IT

• Fully manufactured housing

• Opportunities of PPG 3

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GEORGE WIMPEY PLC

GEORGE WIMPEY PLC

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Stu Cline

President of Morrison Homes

GEORGE WIMPEY PLC

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Vision Statement

“To be the best U.S. Homebuilder as measured

by our customers, employees, shareholders and business partners”

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History

($ in millions) 1995 1996 1997 1998 1999

Revenues ($) 129 190 301 428 509

Operating Profit ($) (4.6) (1.1) 11.5 26.2 41.2

Operating Profit (%) --- --- 3.8% 6.1% 8.1%

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Morrison Homes Markets

Current Markets

Atlanta

Austin

Dallas/Ft. Worth

East Bay Area

Houston

Jacksonville

Orlando

Phoenix

Sacramento

San Antonio

San Joaquin Valley

Sarasota

Tampa

GEORGE WIMPEY PLC

Atlanta, GA

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Orlando, FL

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Celebration,FL

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Tampa, FL

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Houston, TX

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Houston, TX

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Austin, TX

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Austin, TX

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Dallas, TX

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Phoenix, AZ

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Phoenix, AZ

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Sacramento, CA

GEORGE WIMPEY PLC

Sacramento, CA

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Competition (1999)

Five largest US homebuilders

Revenues Closings

Centex Homes $5.8 billion (#1) 18,832 (#3)

Pulte Homes $3.9 billion (#2) 26,622 (#1)

Kaufman & Broad Homes $3.8 billion (#3) 22,460 (#2)

D R Horton $3.3 billion (#4) 19,041 (#4)

Lennar Homes $3.1 billion (#5) 12,589 (#5)

Morrison Homes $509 million (#29) 2,574 (#29)

GEORGE WIMPEY PLC

Branding

GEORGE WIMPEY PLC

Branding

GEORGE WIMPEY PLC

Branding

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Land Bank

Own: 4,280

Option: 3,920

Sales Proceeding 1,230

Controlled 1,650

Total Land Bank 11,080

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Management• Employees - 531• Key Positions

– Regional Sr. Vice President

– Division President

– Skill set• People

• Land

• Leadership Style– Team approach - Multi-discipline

– Participative

• Changing skills in the future– Competency with the Web and Internet - all disciplines

– Process focus

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US Market

US Housing Market (June)

1999 2000 % Change

Housing Starts 1.562m 1.554m (0)

SF Housing Starts 1.269m 1.214m (4)

SF New Homes Sales 0.896m 0.875m (2)

30yr Mortgage Rates 7.55% 8.29% +74 BP

Unemployment Rate 4.3% 4.0% (7)

Consumer Confidence 139.0 138.8 ----

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US Market

Housing Activity Projections

1999Actual

2000Projected

2001Projected

Housing Starts 1.663m 1.604m 1.502m

SF Housing Starts 1.334m 1.263m 1.276m

SF New Homes Sales 0.907m 0.876m ----

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Morrison MarketsThe top 6 job growth states in 1999 were:

#1 California 408,4003.0%

#2 Florida 284,0004.1%

#3 Texas 219,3002.4%

#4 New York 173,4002.1%

#5 Georgia 160,0004.2%

#6 Arizona 100,9004.7%

U.S. Average Job Growth Rate : 2.2%

• Morrison Homes markets represented 223,402 or 16.8% of the total U.S. permit activity in 1999

• Five of Morrison’s markets are in the top 10 U.S. markets

AnnualRate

Net JobGrowth

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Future

• Continue to profitably grow revenues by 15 - 20% per year

• 2003 Milestone:

– $1.0 Billion Revenues

– 4,500 closings (legals)

– Top 20 Builder ranking

• Expand to one new market per year

• Utilise Internet and Web-based technology

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GEORGE WIMPEY PLC