Integration and future strategy

Laing Homes

David Livingstone

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 2001 (the "Order") or (b) any other persons to whom it may otherwise lawfully be communicated, falling within Article 49(1)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 2003, 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.

Integration into GWUK

November 2002 Acquired by GWUK Paul Healey appointed DMD at MK

January – Dec 2003 Six regions contributing to overall business

January 2003 Laing introduced to procurement processesBenchmarking introduced

March 2003 MK overhead reduced

June 2003 PQA introduced EDG devolved into regions

December 2003 975 PD units delivered to profit

Integration into GWUK

January 2004 Six regions reduced to five:North ThamesSouth East ThamesSouth West ThamesThames ValleyMidlands

March 2004 Paul Healey retires

April 2004 David Livingstone becomes DMD – joined George Wimpey in 1973Confirmation of price points to remove high end exposure

July 2004 Laing HQ closure announced

September 2004 Full integration of bench marking and best practice

Shared Values

Safety

Customer satisfaction

Referral cultivation

Performance delivery

Value from scale

procurement

sharing knowledge

common processes

Laing Homes

A premium product, driven by local management

Higher average selling price than George Wimpey

better locations with larger plots

higher specification but not radically different

greater emphasis on design

Like Audi and VW

Laing Homes

However

Had moved into high end premium market

Strategy has been to

significantly reduce exposure to products over £750,000

plan new product over £500,000 carefully

Opportunities for the Future

Working out poor historical sites

Margin improvement through ‘sweating’ overheads and build cost efficiency

Continued improvement through sharing of best practice

Laing learning from GW benchmarking and build cost reduction programmes

GW learning from Laing land consultation and PR

Improving land bank

opportunities to share large sites

better cash management - increased opportunities

Capacity to grow business across the country

Existing businesses -focus on margin improvement

Reduction in build costs

benchmarking

value engineering

Improving land purchase terms

Volume growth within existing businesses

New businesses - growth potential

First steps on geographical growth underway

model defined

target markets identified

Liaison with existing George Wimpey businesses can assist growth and use of assets

Introduce three new businesses

Eastern - Essex

Western - Bristol

Scotland - Edinburgh

Limited overheads

Laing Homes Current Businesses

Laing Homes potential - first steps

Scale of volume opportunity

Long term potential is for a business to compete in size with GW, however

Speed of growth within our own control

Dependent on

general market conditions

land market

Not pushing for volume growth at any cost

Conclusions

Laing Homes is now well positioned

restructuring successfully complete

moving away from high priced markets

further programme of cost reductions in hand

improving landbank to support growth of existing businesses

sensible strategy of volume growth as market conditions allow

Laing Homes SW Thames

Gerry McCormackManaging Director

Introduction

Structure

Area of operation

Current and future outlets

Business performance

Cost excesses

Laing Homes within George Wimpey UK

PQA

Staff

Customers

Structure

Gerry McCormack

Jim Dennis

Technical

Paul Hogarth

Sales & Marketing

Bruce Heffer

Production &

construction

Gordon Patterson

Finance

Steve Andrews

Commercial

Steve Collins

Land

Total monthly paid staff 67

Weekly paid staff 14

Area Map

Current Outlets

393Reigate

335Ph8

408Guildford – Queen Elizabeth Park Ph6

950Guildford – Creek Bridge Road

356Ewell

600Barnes – Creek Bridge Road

Avg Selling Price £’000’s

Current outlets

Future Outlets

298Winchester

393Reigate

416Kingsworthy

303Hindhead

335Ph8

408Guildford – Queen Elizabeth Park Ph6

356Ewell

Avg Selling Price £’000’s

Future outlets

Business Performance

6

4

6

Outlets

14.4%21311.0762004

7.6%1423.6472003

10.5%1577.0452002

PBIT%UnitsPBITT/over

Cost Excesses

£4.3m£0.2m2004

£4.3m£0.9m2003

£5.0m£4.6m2002

OverheadBuild/ Sales

Laing Homes within GWUK

Culture

Commitment to growth

Specialist meetings

Benchmarking and cost control

Improved margins

PQA

Production Quality Awards (PQA)

Tours throughout the UK

PQA panel

50 sites visited

What was learned?

Staff (South West Thames)

Monthly and weekly paid staff

Building in Service Excellence (Core Values)

Business Change Team (B.C.T.)

Investors in People

Staff Communication

Induction programme

Newsletters

Welcome days

Staff conference

Employees satisfaction survey

Customers

Customer satisfaction monitoring

Growing Wiser

Quality and service

Clean and ready

The Future

Outlet growth 2007/8 10-15 outlets

Turnover growth 2008 £120m

PBIT growth 90%

People growth 10%

Overhead efficiency

A Clear Strategy of

Margin Improvement and Growth

GuildfordQueen Elizabeth Park

Guildford – Queen Elizabeth Park History

Former use

Acquired in March 2001- £46m

Planning Trail

Consultation process/ community planning week

Secure planning

Continued liaison with public

Sales launch April 2002

Output per year - 50 units

Laing Homes – consortium leader

The Community

Total site residential 525

35% Affordable Housing

• Key Worker/ Shared Ownership and Housing for rent

Commercial – 100,000 sqft

Office accommodation

Current facilities

• Nursing Homes

• Health and Fitness (Esporta)

• Community Hall

• Doctors Surgery

• Café/ restaurant and food store (Budgens)

The Community

Section 106 benefits Environmental/ Infrastructure improvements to local area -

£800,000

Park and Ride - £1.6m

Bus route - £700,000

Travel vouchers - £105,000

Green Travel Plan

Recycling materials Demolition materials retained on site

17 acres of woodland retained and improved

The Product

Types Price Point

5 Bedroom £740,000

4 Bedroom £600,000

3 & 4 Bedroom £450,000

3 Bedroom £350,000

3 Bedroom £295,000

Awards

Cost Trail

622004

702003

812002

£ per ft

The Site Team

4 teams

Team Leaders Dave Livingstone

Gerry McCormack

Paul Hogarth

Bruce Heffer

Laing Homes SW Thames

Gerry McCormackManaging Director