Strategy

Our approach

• Focus on improving operating
  margin over the medium term
• Improved operational
  efficiency from greater scale
• Use of modular panel
  construction to increase
  asset turn
• Lower capital model to
  deliver higher returns
• Agile model allows
  flexibility through the
  cycle, protecting returns

2021 highlights

• Adjusted operating margin increased by 550bps to 11.0% reflecting changing mix of business and recovery from Covid-19
• 1,150bps increase in ROCE reflecting the recovery from the Covid impact in the prior year
• Commitment to return £450m of cash from legacy operations to shareholders via share buyback programme

Outlook

• 100% Partnerships focus
• Return to target operating margins across the Group
• Improve operational efficiency through greater scale
• Maintain capital discipline to drive ROCE improvement
• Investment in growth while managing gearing levels
• Maintain a conservative approach to net debt and invest in Partnerships growth. Reinvestment to take precedence over shareholder returns

£167.3m

Operating profit

11.0%

Adjusted operating profit

18.6%

Return on capital employed

Our approach

• Mixed-tenure development,
  with private, PRS and
  affordable homes
• Experts at regeneration
  and working closely
  with communities
• New developments created
  with our placemaking
  expertise focused on
  long-term positive outcomes

2021 highlights

• Measured social impact on all
  our developments
• £1m Communities Fund into
  second year
• £243m of social value
  generated, equivalent to 16%
  of adjusted revenue
• Launched our new Building
  Communities strategy

Outlook

• Grow the Partnerships
  pipeline of future work
• Continue to focus on
  mixed-tenure developments
• Continue measuring social
  impact of our developments
• Communities Fund retained
  for another year

56%

of home were affordable or PRS

£243m

of social value generated

91.6%

NHBC recommended a friend score

Our approach

• Record of incremental
  environmental impact reduction
  and social value generation
• Strong culture of ethical and
  responsible decision making

2021 highlights

• Launched new approach
  to sustainability
• Set science-based targets
• Launched pathway to net
  zero report
• Made further progress
  in modular construction

Outlook

• Committed to Task Force on Climate-related Financial Disclosures disclosure by 2022
• Report the changes needed in
  the regulatory environment to
  the Sustainability Committee,
  particularly the use renewable
  heating systems in homes and
  net biodiversity gains on sites
• Continued investment in
  modern methods of
  construction including
  modular panel capabilities

53%

development built on brownfield land

99.5%

site waste diverted from landfill

16,605

plots owned and with planning