39 Cornhill, London EC3V 3NU
tel: 020 7522 3200  fax: 020 7522 3213
web: www.renewholdings.com
delivering specialist
construction services
ANNUAL REPORT & ACCOUNTS  | 2006
renew holdings plc ANNUAL REPORT & ACCOUNTS 2006
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Annual Report & Accounts 2006
highlights 01
chairman’s statement 02
chief executive’s review 03
review of operations 05
financial review 13
directors’ report 14
directors’ remuneration report 18
corporate governance 21
statement of directors’ responsibilities 23
independent auditors’ report 24
group profit & loss account 25
group statement of total recognised gains & losses 25
balance sheets 26
group cash flow statement 27
notes to the accounts 28
shareholder information 52
directors & advisors 53
notice of annual general meeting 54
group businesses 56
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HIGHLIGHTS
01
turnover 
from ongoing
operations £341.7m
(2005: £330.1m)
profit
before tax
£4.6m
(2005: £1.2m)
earnings 
per share
10.0p
(2005: 3.5p)
net cash
balance at 
30 september £19.4m
(2005: £13.6m)
full year
dividend
1.2p
(2005: 0.2p)
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CHAIRMAN’S STATEMENT
02
87379_RENEW_R&A_2006_TEXT PAGE 2
Introduction
I am pleased to report that the Group has
made good progress over the past year. All of
the Group’s businesses are trading profitably
and are generating corresponding levels of
cash. These results do not include any
exceptional items and the Board remains
confident that historic contract exposures are
fully provided for – evidence that the Group is
in good health.
Further and stronger focus on particular areas
of specialism where the Group has strong
skills and experience continues to enhance
the quality and visibility of earnings flow. 
This is highlighted in more detail in the Chief
Executive’s report that follows. The Board
remains committed to improving the Group’s
health and safety performance and is pleased
to note the progress made during the year. 
Results and dividend
Group turnover from ongoing operations for
the year ended 30 September 2006 was
£341.7m (2005: £330.1m) and profit before
tax was £4.6m (2005: £1.2m). Earnings per
share were 10.00p (2005: 3.46p). The
Group’s net cash balance, exclusive of a
specific development loan of £9.8m, at 
30 September was £19.4m (2005: £13.6m).
Net assets have increased to £5.3m from
£4.8m after the impact of incorporating a
£2.8m net pension scheme deficit.
The Board is declaring a final dividend of 
0.8p per share, which will be paid on 
26 February 2007 to shareholders on the
register as at 26 January 2007. This will 
result in a dividend of 1.2p per share for the
full year (2005: 0.2p), reflecting the Group’s
progressive dividend policy and the Board’s
confidence in the Group’s future performance. 
Acquisition
During the year the Group acquired PPS
Electrical Limited, an electrical contractor
specialising in asset support for the nuclear
sector, for £664,000 in cash. PPS has been
successfully integrated into Shepley Engineers
and is trading in line with expectations. 
Pension scheme
In line with many other UK companies, the
Directors, in calculating the Group’s pension
position, have adopted mortality tables which
now reflect the expectation of a longer
lifespan for pension fund members. As a
result, the Directors have recognised a
pension deficit of £2.8m on the Group
balance sheet, net of deferred tax, compared
to a surplus of £1.6m at 30 September 2005. 
Board changes
On 1 May 2006, John Samuel FCA joined the
Board as Group Finance Director and Philip
Underwood stepped down from the Board to
concentrate on running VHE Construction and
Shepley Engineers. On 1 October 2006, 
John Bishop FCA joined as non-executive
Director. John Bishop has extensive
experience in the construction industry and
over 20 years PLC experience at main board
level. On 31 October 2006, Arnold Wagner
OBE stepped down from the Board to
concentrate on his executive responsibilities 
at Smiths Group plc. 
Outlook 
The positive actions taken by the new
management team augur well for the future,
and the Board is confident of making further
progress in both profitability and cash
generation in the new financial year.
Roy Harrison
Chairman
28 November 2006 
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03
Overview and strategy 
This has been a year of further positive
development for the Group, and I am pleased
to be reporting a good performance across all
our businesses. This is the result of our
strategy of focusing on attractive market
sectors in which we have good skills and
experience, whilst providing effective support
and control from the centre through our
holding company structure. 
This approach allows our individual specialist
construction businesses to build on the
strength of their own brands within their areas
of operation, whilst benefiting from the
financial strength, commercial controls and
implementation of best practice procedures
from the Group’s central function, thereby
maximising the use of Group resources. 
This has resulted in a better quality order
book, which at 30 September 2006 was
£208.7m compared to £193m at the same
time last year, excluding the future benefits of
current frameworks. 78% of total orders now
lie within our core specialist activities, and
68% of new orders in 2006 were procured
through a two-stage, framework or negotiated
process with key clients. Over 70% of our
orders won have been from clients with whom
we have worked previously. 
As a continuation of our strategy of specialism
and project selectivity, and in order to
maximise the potential of our skills base and
provide consistent and cash generative
growth, we will be aligning our activities into
two focused business streams, namely
Specialist Engineering and Specialist Building.
Specialist Engineering will incorporate our
Nuclear and Land Remediation activities, and
Specialist Building will operate across a range
of regionally based, selective markets
including Social Housing, Retail, Restoration &
Refurbishment and Science & Education. 
Through our Specialist Engineering activities
we have established a good market position
and our intention is now to build on our
reputation both through organic growth and
through strategic acquisitions. The objective of
our Specialist Building activities is to continue
to generate reliable returns whilst focusing on
margin improvement and cash generation.
Review of operations
In Nuclear, we were reappointed on major 
three-year framework agreements with British
Nuclear Group to provide further operational
asset support and decommissioning and
demolition services on a number of redundant
facilities at Sellafield. During the year, we
acquired PPS Electrical Limited based at
Sellafield which has significantly enhanced 
our service offering, strengthening Shepley
Engineers’ position as the largest mechanical
and electrical contractor at this site. 
In Land Remediation, we project managed
and carried out the reclamation of the former
Stella South Power Station in Gateshead for
St Paul’s Developments and are currently
delivering site clearance and infrastructure
works at the former Rugeley Power Station 
for Persimmon Homes, due for completion in
September 2007. We are also delivering
remediation works for National Grid Property
under a framework agreement for its UK-wide
portfolio of redundant gas works. 
In Social Housing, we are now working in the
South East with five of the top six Housing
Associations. During the year, we have
successfully completed a £16.5m project 
for Community Housing Association and 
have also been appointed by the same client
as a key framework contractor. In total, we
have over £80m of future work in negotiation
with various Housing Associations as
preferred supplier. 
In Retail, we completed a major distribution
warehouse for Tesco during the year as 
well as new build and refurbishment projects
for three major stores. We have been 
working with Tesco for over 20 years now,
demonstrating the strength of our relationship.
We are also constructing a range of other
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CHIEF EXECUTIVE’S REVIEW
04
87379_RENEW_R&A_2006_TEXT PAGE 4
retail projects including a B&Q store in
Folkestone and the refurbishment of the
Cribbs Causeway Retail Park in Bristol for
Prudential Assurance. 
In Science & Education, we secured a £13m
project for the British Library. We are also
carrying out numerous projects for The
Department for Environment, Food and 
Rural Affairs through our current framework
agreement which is now in its sixth year. We
have recently established another framework
agreement with the National Physical
Laboratory. During the year we completed
schemes at a number of colleges and
universities including a new build extension 
at Imperial College, London and the new
Institute of Cancer Therapeutics at Bradford
University as part of framework agreements
with these clients. 
In Restoration & Refurbishment, we are
restoring the wrought and cast iron Victorian
roof and undercroft structures of the Grade 1
listed St Pancras station in London, which will
be the new hub for the Channel Tunnel Rail
Link. We continue to secure major contracts
to restore and refurbish very high quality
residential properties in the west of London
both for private individuals and property
investment businesses. Additionally, we have
extended our customer base in rail
infrastructure refurbishment.
We are also starting to see the benefits of
offering clients multiple and complementary
services, as is evidenced by a £15m public
sector project in Lancashire which was
completed on time and to budget. 
This pre-sold integrated development project
combined the construction skills of Allenbuild
and the land remediation capabilities of 
VHE Construction.
Property
The Group continues its strategy of
maximising the value of our portfolio of UK
and US property assets and progressively
realising them for cash. During the year, we
sold our head office building at Cornhill in
London for £12m, as well as two other UK
properties, which realised over £6m together.
This enabled the Group to eliminate over
£12m of associated borrowings. In the USA,
we have generated more than £3m of cash
through asset realisations.
People
The Group attaches great importance to the
health and safety of all those affected by our
activities. At the start of the financial year I set
out a target of decreasing the accident
incident rate by 10% per annum, and I am
pleased to report that we achieved a 19%
reduction during the year.
The Group is now well on its way to recovery
following what has been a difficult period. 
The Board is pleased to note a significant
improvement in the Group’s employee
retention rate and is extremely grateful to 
all our people for their hard work and
dedication in helping to bring the business
back to health. We have an experienced
management team in place and I am
confident that with the continued support of
everyone in the Group we will see further
success in delivering on our strategy. 
Prospects
Vigorous business processes are now
established across all of the Group’s activities.
Through increased focus on the strengths of
our two specialist business streams, which
operate in robust and growing markets, we
expect to further develop our order book and
to deliver consistent, growing profits
supported by strong cash generation. 
Brian May
Chief Executive
28 November 2006 
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operations
REVIEW OF OPERATIONS  
Each of Renew’s construction businesses is 
trading profitably with contracts performing in line 
with expectations. 
Risk management and contract selectivity have been
further strengthened, with detailed assessments being
undertaken at various times during the tender and 
pre-contract phase. This process identifies potential
projects which are likely to carry a disproportionate 
risk in relation to the anticipated profit and
demonstrates our determination to reduce risk and
produce a reliable financial performance. 
The Executive Management Committee has been
formed, which consists of the main Board Executive
Directors, the Managing Directors of the operating
businesses and the Heads of the Group’s support
services. The Committee meets once a month to 
review business performance and operational activity
and to share new ideas and best practice, looking to
add value to our business and our clients where
opportunities exist to work together.
05
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REVIEW OF OPERATIONS    
06
87379_RENEW_R&A_2006_TEXT PAGE 6
Nuclear 
Specialist Engineering within the nuclear
sector is delivered through Shepley Engineers,
a major mechanical and electrical contractor
and project manager, and its subsidiaries
West Cumberland Engineering Ltd (WCEL)
and PPS Electrical Limited (PPS).
Shepley’s work at Sellafield, Springfield 
and Chapelcross power stations is split
between operational asset support and the
decommissioning and demolition of redundant
facilities. Contracts are generally secured
through framework arrangements, two of
which have been recently renewed for another
three years. Shepley, which has over 25 years
experience on the Sellafield site, has received
over 30 commendations for work done during
the year. An especially notable event was the
first ever demolition of a building within the
Controlled Area at Sellafield. 
Digital modelling techniques and investment 
in and use of computerised management
technology give Shepley an edge in what is
perceived as a labour intensive market.
2
million
hours
Time passed
without a RIDDOR
reportable lost 
time accident. 
Shepley’s capability was further strengthened
in June with the acquisition of PPS Electrical
Limited which specialises in asset support for
the nuclear sector. The combined business is
now the largest mechanical and electrical
contractor at Sellafield. In addition WCEL
secured a three-year contract to manage 
and provide machined and fabricated spares
on the site.
The nuclear sector is one of the most highly
regulated in the world where safety is
paramount. In 2006 Shepley distinguished
itself by winning a RoSPA President’s Award
for securing ten consecutive Gold Awards.
Shepley, WCEL and PPS have now achieved
two million hours without a RIDDOR
reportable lost time accident.
Land Remediation
VHE is a leading provider of land remediation
services with a varied public and private
sector client base.
VHE has extensive experience in reclaiming
brownfield land utilising in-house designed
specialist
engineering
> The first ever demolition 
within the Controlled 
Area at Sellafield required 
intensive planning 
including digital modelling
of the building.
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and developed solutions which apply innovative
and sustainable services such as specialist
biophysical treatment, soil washing, stabilisation
and groundwater treatment to maximise the
value of redundant land. A current remediation
project is the £4.6m reclamation of the former
Stella South Power Station in Gateshead for
St Paul’s Developments that includes the
biophysical treatment of hydrocarbon-
contaminated materials for re-use on site.
Re-using materials recovered from site is a
key component in VHE’s strategy in reducing
brownfield regeneration costs and promoting
sustainability. The company beat its own target
of recycling 1.1 million tonnes of materials
during the course of the year, producing
substantial cost savings.
Demolition and site clearance together with
infrastructure works is provided as part of a
complete enabling package to enable clients
to be on site more quickly for development.
A key project due for completion in September
2007 is the £4.7m remediation of the former
Rugeley Power Station. This involves the
re-engineering of over 450,000m
3
of materials
on site to provide development platforms and
road corridors for a 700 unit residential
development for Persimmon Homes. 
National Grid Property (formerly British Gas
property division) also retains VHE under a
term contract for the remediation of its
UK-wide portfolio of redundant gas works.
This agreement has provided work on five
contracts during the year.
1. 1
The amount of
material recycled
by VHE, saving
clients an
estimated £5m.
VHE has a commitment to sustainability 
and its recycling initiative has diverted some
300,000 tonnes of treated material from
landfill as well as creating 800,000 tonnes of
reusable aggregates, of which half are high
specification road building materials.
million
tonnes
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REVIEW OF OPERATIONS    
08
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Social Housing
Through its Allenbuild subsidiary, the Group 
is now one of the leading contractors within
the new build social housing market in the
South East.
Allenbuild is working for five of the top six
Housing Associations, and, following the
successful completion of a £16.5m project in
London for Community Housing Group, was
recently appointed by them as a framework
contractor in the categories of £3-10m and
£10m plus.
A £5.5m project to provide 40 flats is
underway for Logic Homes (formerly Gentect
Homes) in Crawley. There is a pipeline of 15
further schemes worth £59m under preferred
supplier negotiations with the same client.  
Two design and build projects are also under
construction for London & Quadrant Housing
Trust. A £8.6m contract in Forest Hill, 
London, will provide 42 residential units, 10
live-work units and seven commercial outlets
on the site of a former factory. The second
scheme involves the £5m construction of 
37 apartments and a crèche in Deptford 
and forms part of the regeneration of the
Pepys Estate.
A key component of Allenbuild’s success is
the use of modern methods of construction.
Timber frames, bathroom pods and other 
pre-fabricated items have contributed to
reduced construction programmes, improved
quality and cost certainty.
In the Midlands, Allenbuild is constructing 
30 new two- and three-bedroom houses and
one-bedroom flats at Redditch in conjunction
with Redditch Co-operative Homes. This
£3.5m project is the fourth carried out in
partnership with Accord in Redditch. Other
schemes are also being undertaken for 
South Kesteven District Council and Amber
Valley Housing Association.
specialist
building
Schemes under
preferred supplier
negotiation with
Logic Homes. 
£
59m
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Retail
Building upon its 22 year relationship with
Tesco, Britannia Construction completed its
largest project for the retailer, a £18.9m
238,000 sq ft distribution centre at Magor in
South Wales. Britannia Construction also
completed new stores at Llansamlet in
Swansea and Brockworth in Gloucester, and
is currently working on an extension to the
Cheltenham store. 
Britannia is also constructing a range of other
retail projects including the shell for a B&Q
store in Folkestone and the refurbishment of
the Cribbs Causeway Retail Park in Bristol for
Prudential Assurance.
New store developments, refits and
refurbishments are also undertaken by
Britannia for a number of other leading
retailers such as Aldi. Following the
construction of a new store in Swindon,
Britannia has completed a further 10 projects,
the most recent being the conversion of two
former Kwik Save stores in Rhymney and
Llandrindod Wells in South Wales.
Allenbuild has amassed a solid portfolio of
retail expertise, especially in retail parks.
Phase two of the Three Lakes Retail Park 
in Selby entailed the construction of a 
43,000 sq ft store, to provide a retail area 
and fitness club. In Hull, Allenbuild built The
Twilight Zone, a 22,000 sq ft extension to 
The Deep, one of the region’s most popular
visitor attractions. A £3.3m Audi showroom
and garage was also completed by Allenbuild
in Walton-on-Thames.
Following the successful completion of a
project at the Crystal Peaks Retail Park in
Sheffield in 2005, the client, Hermes, has
awarded Allenbuild a further £5m contract to
redevelop a supermarket on the same site.
Science and Education
Walter Lilly is in the sixth year of a framework
agreement with The Department for
Environment, Food and Rural Affairs (DEFRA)
at the Veterinary Laboratories Agency in
Weybridge. The Mills Building on the site was
a winner in the 2006 BREEAM Awards,
Bespoke category, as well as winning the
Relationship 
with Tesco.
22
Renew companies are at the
cutting-edge of the science and
education sector, delivering a
wide range of premises for the
major universities and
pharmaceutical companies.
year
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REVIEW OF OPERATIONS    
10
87379_RENEW_R&A_2006_TEXT PAGE 10
Sustainability category in the regional RICS
Awards 2006.
The company completed its first framework
project for Imperial College London at their
South Kensington campus, a new build
extension housing their Cross Faculty NMR
Imaging facility. The first contract has also
been awarded under a framework from the
National Physical Laboratory (NPL) at
Teddington to modify existing laboratories.
Work is ongoing for GlaxoSmithKline’s
Research and Development arm where 
Walter Lilly has completed more than 40
capital projects since 1991.
Allenbuild continued to develop its presence 
in the education sector, completing a number
of schemes for schools, colleges and
universities. Three projects worth £10m,
including the new Institute of Cancer
Therapeutics, were completed under a three-
year framework agreement with the University
of Bradford. Allenbuild also secured a £13m
project to construct a high-density archive
storage building for the British Library at
Boston Spa, Yorkshire.
40
Capital projects
completed for
GlaxoSmithKline
since 1991. 
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Restoration and Refurbishment
Restoration and refurbishment, often involving
extensive structural change, is a skill delivered
by a number of Group companies. One of 
the most high profile projects is the restoration
of the Grade 1 listed St Pancras station in
London which will be the new hub for the
CTRL. The wrought and cast iron Victorian
structural roof and undercroft has been restored
by Shepley under a three-year contract.
YJL London continues to serve the City and
West End markets and has broadened its
portfolio with two student accommodation
projects located on adjacent sites. The
refurbishment of one property involves the
demolition and replacement of staircases 
and lift shafts together with the construction
of two new floors. The company has also
entered into a framework with Guy’s and 
St Thomas’s Hospital Trust on the back of its
extensive healthcare expertise. In Clerkenwell,
YJL London completed the £8.5m
refurbishment of a former Victorian workshop,
removing the roof and constructing a fifth
storey along with repositioning lift shafts on 
a constricted site.
Additionally, Allenbuild is restoring the 
Reform Club in Pall Mall to the original design
by renowned Victorian architect Sir Charles
Barry, as well as the Wood End Museum of
Natural History in Scarborough for
Scarborough Borough Council.
Grade1
St Pancras station
and the Reform
Club, both being
refurbished and
restored by Renew. 
< Bespoke designs require 
high quality craftsmanship
to meet the requirements 
of discerning clients. 
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Annual Report & Accounts 2006
12
Many of Walter Lilly’s bespoke private
residential projects involve the complete
internal remodelling of prime central London
properties, often behind just a retained
facade. Principally operating in Belgravia,
Kensington, Chelsea and Hampstead, the
projects involve numerous structural
challenges, including the protection of
neighbouring properties where underpinning
or work to party walls is required. Work 
on projects in Kensington and Chelsea is
continuing for long-standing client Cadogan
Estates. A sixth London office refurbishment
project has also commenced with developer
Redab plc. 
YJL Infrastructure (YJLi) is a leading provider
of construction services for rail operators and
asset providers in London and the South
East. Active in the rail sector for more than 
25 years, the company has carried out
construction works on every station and train
depot on London Underground’s network as
well as on over 450 mainline rail stations and
20 mainline train depots.
During the past year YJLi has continued to
modernise and refurbish underground stations
with three stations – Golders Green, Stockwell
and Morden – all being completed on
schedule. Work has commenced on a further
three stations for Tube Lines – Belsize Park,
Bounds Green and Hampstead – together
with Step Free Access projects at Morden
and Golders Green. YJLi has also recently
started an upgrade of facilities for GNER at
their Bounds Green depot.
450
Mainline rail
stations and 20
mainline train
depots worked 
on by YJLi.
< YJLi is undertaking 
Step Free Access 
projects alongside the 
modernisation and 
enhancement programme
of London Underground 
stations. 
87379_Renew_R&A_2006_Text.qxp  8/12/06  17:07  Page 12 Results
The Group’s turnover from ongoing operations
was £341.7m (2005: £330.1m) resulting in an
operating profit of £3.5m (2005: £2.7m prior 
to exceptional items). Profit before tax was
£4.6m (2005: £1.2m).
Cash generation
The Group’s operating performance has 
been complemented by strong cash
generation, both from operations and from 
the successful realisation of surplus property
assets. Excluding the impact of funding a
major UK development project and the
proceeds of property disposals, operating
activities generated £3.6m of cash,
substantiating the cash backed nature of 
our operating profit.
The sales of surplus UK properties, including
the Head Office building at Cornhill in 
London, generated over £18m of gross
proceeds which enabled us to redeem over
£12m of associated debt. We have leased
back a small portion of the building under a 
two-year agreement.
At the year end, our net cash position was
£9.6m, after deducting a £9.8m development
loan. The Board expects to redeem that loan
in December 2006 with the proceeds of the
sale of the development. The sale was
originally agreed in February 2006.
Lovell America Inc.
The Group has approximately £13m of net
assets in the USA, where Lovell America Inc.
is progressively realising these assets for cash
repatriation to the UK. This process has led to
more than 28% of the US assets being in the
form of cash or receivables at the year end
compared to less than 4% last year. 
Pensions
Incorporating mortality assumptions which
predict longer lives for pension fund members
has created a gross deficit of £4m in the
Lovell Pension Scheme, which was closed 
to new members in 2000. At the moment,
company contributions remain unchanged at
approximately £1.2m per year. The Board 
will shortly seek to reach agreement with the
Trustees of the scheme on the level of 
future contributions in accordance with the
scheme specific funding requirements of the
Pensions Act.
Taxation
A deferred tax asset of £2.9m is carried in the
balance sheet, recognising an increase of
£1.4m in the year, which results from the likely
future utilisation of tax losses through the
improved and profitable trading of the Group.
John Samuel
Group Finance Director
28 November 2006
FINANCIAL REVIEW
13
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3.0 
2.0
1.0
2006 2007 2008 2009
TARGET 2%
ACTUAL 1%
Profit before tax as a percentage of sales
DIRECTORS’ REPORT
14
The Directors present their Report and the audited
accounts for the year ended 30 September 2006.
Principal activities
For the year ended 30 September 2006 the principal
activity of the Group was in construction and construction
related activities. The main construction activities are
carried out in the United Kingdom with some development
activities in the USA. More details of these activities, the
year’s trading and future developments are contained in the
Chairman’s Statement, the Chief Executive’s Review, the
Review of Operations and the Financial Review. A list of the
principal operating subsidiaries and joint ventures of the
Group as at 30 September 2006 appears on page 51.
Results and dividends
The Group made a profit for the year before taxation 
of £4,639,000 (2005: £1,175,000). The Group profit
attributable to shareholders was £5,988,000 
(2005: £2,074,000). The Directors recommend the
payment of a final dividend on Ordinary Shares of 0.8p
(2005: 0.2p) giving a total for the year of 1.2p (2005: 0.2p).
Key performance indicators
The Directors have established a number of key
performance indicators which they use to measure and
monitor the performance of the Group in a number of
different areas. These measures are set out in the tables
below. The target given for profit before tax as a
percentage of sales is a medium-term target which the
Directors are aiming to achieve within three years. The
order targets have been established as part of the Board’s
drive to improve the quality and sustainability of the
Group’s workload and to support the reliability of financial
performance. The safety record improvement target is set
annually and achievement of this target is an essential
component of the bonus scheme for each Director and
senior manager within the Group. These measures have
been introduced by the Chief Executive who was
appointed in June 2005. As a result, comparative
performance statistics are not available for the prior year 
for the key performance indicators.
Principal risks and uncertainties
This Annual Report contains certain forward looking
statements. These statements are made by the Directors in
good faith, based on the information available to them up
to the time of approval of this Report. Actual results may
differ to those expressed in such statements, depending on
a variety of factors. These factors include customer
62
%
63
64
65
66
67
68
69
70
71
72
ACTUAL 69%
TARGET Not less than 66%
2006
Percentage of orders from repeat clients
%
62
64
66
68
70
72
74
76
78
80
82
ACTUAL 78%
TARGET Not less than 66%
2006
Percentage of orders in specialist sectors
%
08
09
10
11
12
13
14
15
16
17
18
20
19
ACTUAL 19%
TARGET 10% IMPROVEMENT
2006
Improvement in Accident Incident Rate
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 14
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15
acceptance of the Group’s services, levels of demand in
the market, restrictions to market access, competitive
pressure on pricing or additional costs, failure to retain or
recruit key personnel and overall economic conditions.
A risk inherent in the construction industry occurs in the
nature, timing and contractual conditions which exist at the
time of contract procurement. To mitigate these risks, the
Group has a system of pre-contract and pre-tender risk
assessment whereby senior management, including the
Executive Directors where appropriate, review and advise
on specific issues arising in the contract procurement
process. The Group also seeks to limit its risks by
specialising in certain markets where it has extensive
experience and a particular skills base.
Derivatives and other financial instruments
The Group’s principal financial instruments comprise bank
loans, cash and short-term deposits and obligations under
finance leases. The main purpose of these financial
instruments is to provide finance for the Group’s
operations. The Group has various other financial
instruments such as trade debtors and trade creditors that
arise directly from its operations. The Group also uses
foreign currency borrowings to hedge certain of the
currency risks arising from the Group’s overseas
operations. It is, and has been throughout the period under
review, the Group’s policy that no trading in financial
instruments shall be undertaken. The main risks arising
from the Group’s financial instruments are interest rate risk,
liquidity risk and foreign currency risk.
Price risk
The Group has no significant exposure to securities price
risk, as it holds no listed equity investments.
Cash flow interest rate risk
The Group borrows in sterling at floating rates of interest
under the terms of overdraft and bond facilities with Barclays
Bank plc and Bank of Scotland plc. Interest rates are linked
to London Inter-Bank Offer Rate (LIBOR) and the Bank’s
base rates, hence enabling the Group to track market
interest rates. The Group also has a loan arrangement with
the Bank of Scotland plc at floating rates of interest under a
separate agreement. Interest bearing assets comprise cash
and bank deposits and earn interest at floating rates.
Liquidity risk
The Group’s policy is to ensure availability of operating
funds by maintaining an appropriate cash balance in both
current and deposit accounts and to establish appropriate
levels of borrowing facilities to provide short-term flexibility. 
Foreign currency risk
As a result of the investment in operations in the United
States, movements in the US dollar/sterling exchange rate
could materially affect the Group’s balance sheet. The
Group seeks to limit the effect of this currency exposure 
by using foreign currency borrowings to hedge these
investments against currency depreciation. The principal
hedging instrument used by the Group is a US$ loan that
was taken out on 8 November 2000 when the US$ to £stg
rate was $1.446. The original hedge amounted to US$25m
and this has been reduced to US$15.5m by the receipt of
funds from the US in the intervening period. The current
hedging arrangements expire in November 2008. As at 
30 September 2006, £12,979,000 (2005: £13,639,000) 
of the Group’s net assets are denominated in foreign
currency. The Group does not use derivative financial
instruments in its management of foreign currency risk.
Credit risk
The Group’s principal financial assets are bank balances,
cash, amounts recoverable on contracts and trade
debtors, which represent the Group’s maximum exposure
to credit risk in relation to financial assets.
The Group’s credit risk is primarily attributable to its
amounts recoverable on contracts and trade debtors.
Credit risk is managed by monitoring the aggregate
amount and duration of exposure to any one customer
depending upon their credit rating. The amounts presented
in the balance sheet are net of allowances for doubtful
debts, estimated by the Group’s management based on
prior experience and their assessment of the current
economic environment.
Environment
The Group’s policy with regard to the environment is to
ensure that we understand and effectively manage the
actual and potential environmental impact of our activities.
Our operations are conducted such that we comply with all
legal requirements relating to the environment in all areas
where we carry out our business. During the period
covered by this Report the Group has not incurred any
fines or penalties or been investigated for any breach of
environmental regulations.
Payment of creditors 
The Group recognises the importance of good relationships
with its suppliers and sub-contractors and has established
the following payment policy:
(a) agree payment terms in advance of any commitment
being entered into;
(b) ensure suppliers are made aware of these terms 
by inclusion of the terms of payment on the order 
or contract;
(c) ensure that payments are made in accordance with 
the terms of the contract or order providing that the
presented documentation is complete and accurate. 
The Company’s average creditor days during the year
were 44 days (2005: 30 days).
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16
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 16
Donations
Charitable donations made by the Group during the year
amounted to £19,467 (2005: £12,170). The Group made
no political donations during the year (2005: £nil).
Employees
The Directors recognise the need for communication 
with employees at every level. All employees have access
to a copy of the Annual Report and Accounts, which
together with staff briefings, internal notice-board
statements and newsletters, keeps them informed of the
Group’s progress. The Directors are actively considering
ways to increase further the involvement of employees in
the Group’s performance.
The Group continues to be committed to the health, safety
and welfare of its employees and to observe the terms of
the Health & Safety at Work Act 1974, and all other
relevant regulatory and legislative requirements. It is the
policy of the Group that there shall be no discrimination or
less favourable treatment of employees, workers or job
applicants in respect of race, colour, ethnic or national
origins, religious beliefs, sex, sexual orientation, disability,
political beliefs, age or marital status. Full consideration will
be given to suitable applications for employment from
disabled persons, where they have the necessary abilities
and skills for that position, and wherever possible to 
re-train employees who become disabled, so that they can
continue their employment in another position. Renew and
its subsidiaries engage, promote and train staff on the
basis of their capabilities, qualifications and experience,
without discrimination, giving all employees an equal
opportunity to progress within the Group.
Health and safety management 
Brian May continues as the designated Board Director of
Health and Safety with Group responsibility for safety and
environmental management. Health, safety and
environmental management, issues and reports are
regularly reviewed at Group Board Meetings with the Head
of Department in attendance when necessary. The
Executive Management Committee, chaired by the Chief
Executive, discusses and progresses policy, legislative
changes, best practice, training needs, inspections, audits
(internal and external), performance measurement and
statistical information. All topics are discussed with a
specific focus on improvement.
Control at business level remains with subsidiary Managing
Directors who are required to appoint a Director who is
responsible for safety and environmental matters. Both
safety and environmental issues are discussed as the first
agenda item at monthly board meetings. Each business
safety and environmental meeting encourages open
communication between all employees and is a key part of
the Group’s efforts to gather and disseminate good practice
for inclusion in business-based management systems.
Minimum safety and environmental standards are
contained within the new bespoke business Safety and
Environmental Management Systems that are in the
process of being launched. This new system is based on
Group activities and provides specific standards,
procedures, information, forms and advice which
accommodates changes in legislation expected during the
coming financial year. Management advice is provided by
the Group Health, Safety and Environmental Department
consisting of the Group Health, Safety and Environmental
Director, an administrator and six Group Safety and
Environmental Advisors.
Certain Group companies employ their own specialist
advisors who liaise directly with the Group HSE Director on
common issues. The Group maintains its membership with
the Royal Society for the Prevention of Accidents (RoSPA)
and locally-based construction safety groups. All safety and
environmental department personnel hold membership with
the Institution of Occupational Safety and Health (IOSH).
These advisors undertook 1,271 monitoring inspections
and reports during the last 12 month period. Attendance
on the five day CITB Site Safety Management Training
Scheme continues to be a requirement for all construction
management personnel, with a two-day refresher required
every five years. A one-day Directors and Senior Managers
course is available internally and is used to introduce new
systems and detail changes to construction legislation
expected in April 2007. Short duration ‘tool box talks’ and
‘safety briefings’ are increasingly used to enhance the
knowledge and competence of supervisory management.
Group policy requires each business to report and record
all injuries, diseases and dangerous occurrences,
regardless of severity. An incident database is maintained
to collate this information and provide statistical data
allowing performance to be measured and determine
system amendment and future training requirements. A
system of Safety and Environmental Alerts ensures lessons
learnt and changes to working practices are rapidly
transmitted to our workforce, businesses and their
contractors. The Accident Incidence Rate (AIR) for the 12
month period to 30 September 2006, measured on the
standard base line of 100,000 persons at work, is a key
area where the Group measures its performance. At the
start of the financial year the Chief Executive set a target of
reducing AIR by 10% per annum. Against this taxing target
the Group actually achieved a 19% reduction.
Directors
The present Directors of the Company are set out below. 
John Samuel FCA was appointed as Group Finance
Director on 1 May 2006. Phil Underwood stood down as 
a Director on the same date. John Bishop FCA was
appointed an Independent non-executive Director on 
1 October 2006. Arnold Wagner OBE stood down as a
non–executive Director on 31 October 2006. 
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17
Messrs. Samuel and Bishop will offer themselves for 
re-election at the Annual General Meeting (“AGM”). The
Director retiring by rotation is Brian May who, being eligible,
offers himself for re-election at the AGM. 
Brief biographical details of the present Directors are set 
out below.
Non-executive Directors
John Bishop - Director, 61, appointed to the Board as a
non-executive Director in October 2006. He is a Chartered
Accountant with over 20 years PLC experience at Main
Board level. Before retiring in 2005 John spent 12 years at
Morgan Sindall Plc as Development Director and latterly as
Finance Director. He is currently Chairman of CLC Group
PLC, a leading UK building maintenance business, and
Primary Medical Property Limited, a specialist property
investment company.
Roy Harrison - Director, 59, appointed to the Board as a
non-executive Director in November 2003. Subsequently
appointed Executive Chairman in March 2004, reverting to
non-executive Chairman with effect from 1 October 2005.
He is a former Chief Executive of the Tarmac Group and
has a number of investing Director positions in private
construction materials companies. Roy is a non-executive
Director of BSS Group Plc, President of the Construction
Products Association, a member of the Government’s
Strategic Forum for Construction, Chairman of Thomas
Telford City Technology Trust, the No 1 UK comprehensive
school, and Chairman of Thomas Telford On-Line, a major
curriculum provider.
Executive Directors
Brian May - Director, 55, appointed to the Board as Chief
Executive Officer in June 2005. He is a Chartered Civil
Engineer who progressed his career in Tarmac, subsequently
holding a number of senior positions in Mowlem plc before
becoming Chief Executive of Laing Construction plc and
more latterly HBG Construction Ltd. Brian is also a 
non-executive Director of Parkwood Holdings plc.
John Samuel - Director, 50, joined the Board in May 2006
as Group Finance Director. He was previously Group
Finance Director at Filtronic plc from 1991 until 2004 and
subsequently Chief Financial Officer of Zetex plc from July
2004 until February 2006. John qualified as a Chartered
Accountant in 1981 with Deloitte, Haskins and Sells before
serving as a partner with Baker Tilly from 1987 until 1991. 
An organogram with the Directors’ areas of responsibility
can be found on the Company’s website:
www.renewholdings.com 
Directors’ interests
The beneficial interests of the Directors in the shares of the
Company and options for shares are set out on page 20.
No Director has any interest in any other Group company.
Details of the Directors’ remuneration and service contracts
appear on pages 19 and 20.
Substantial shareholdings
At 28 November 2006 the following shareholders had
notified interests of 3% or more in the Company’s issued
Ordinary Share capital:
Number of shares Percentage
Anglo Irish Trust Company Ltd
as Trustees of the
OG McLaughlin Settlements 4,000,000 6.68%
Johan Claesson and 
connected parties 3,930,723 6.56%
Goldman Sachs International 3,575,324 5.97%
G Merrett 2,323,250 3.88%
V Tchenguiz 2,000,000 3.34%
Share capital
During the current financial year the Company has not
bought back any of its own shares nor issued any new
share capital and as a result the total number of shares in
issue remains at 59,898,927 as at 30 September 2006. 
Disclosure of information to Auditors
At the date of making this Report each of the Company’s
Directors, as set out on this page, confirm the following:
• So far as each Director is aware, there is no relevant
information needed by the Group’s Auditors in
connection with preparing their Report of which the
Group’s Auditors are unaware, and
• Each Director has taken all the steps that he ought to
have taken as a Director in order to make himself
aware of any relevant information needed by the
Group’s Auditors in connection with preparing their
Report and to establish that the Group’s Auditors are
aware of that information.
Auditors
RSM Robson Rhodes LLP have expressed their willingness
to continue in office as Auditors to the Group and a
resolution will be proposed at the forthcoming AGM to 
re-appoint RSM Robson Rhodes LLP and to authorise the
Directors to determine their remuneration.
Approval
The Board approved the Report of the Directors on 
28 November 2006.
By Order of the Board
Catherine Wright LLB FCIS
Company Secretary
87379_RENEW_R&A_2006_TEXT PAGE 17
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18
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 18
The Directors present the Directors’ Remuneration Report
(the “Remuneration Report”) for the financial year ended 
30 September 2006. As an AIM listed company, Renew is
not required to prepare the Report in accordance with the
Directors’ Remuneration Report Regulations 2002 (the
“Regulations”), which introduced new requirements in
respect of financial periods ending on or after 
31 December 2002. However, the Directors recognise the
importance and support the principles of the Regulations
and would normally seek to follow them to the extent
considered relevant for an AIM listed company.
The Auditors are not required to report to the shareholders
on the Directors’ Remuneration Report. 
Remuneration Committee
Following the appointment of Roy Harrison as Executive
Chairman in March 2004, there was only one independent
non-executive Director on the Board and the Committee
was rendered inquorate. The Board therefore decided in
July 2004 to temporarily suspend all Committees. Roy
Harrison’s previous role as an Executive Director precludes
him from being considered as independent under the
Combined Code (the “Code”) and so the Board has
decided to continue to review remuneration matters as a full
Board. Any matters normally reserved for consideration by
the Remuneration Committee are currently decided upon by
the full Board, with any individual having a personal interest
in the matter under consideration not taking part in the
meeting. The Board held 10 meetings during the financial
year to discuss remuneration arrangements.
The Remuneration Committee’s normal terms of 
reference include: 
(a) To determine and agree with the Board the framework
and policy for the remuneration packages, including
bonuses, incentive payments and share options or
share awards, of the Executive Directors and members
of the Executive Management as it is designated 
to consider;
(b) To review and approve the design of all share incentive
plans and performance related pay schemes for
approval by the Board and shareholders as applicable;
(c) To determine targets and awards made under share
incentive plans and performance related pay schemes; 
(d) To determine the policy for, and scope of, pension
arrangements for each Executive Director and other
senior executives;
(e) To ensure contractual terms on termination and
payments made are fair to the individual and Company
and that failure is not rewarded.
Non-executive Directors do not have any personal interest
in the matters to be decided by the Committee other than
as shareholders, nor any potential conflicts of interest arising
from cross-directorships and no day-to-day involvement in
the running of the Company. The Executive Directors and
other senior personnel may be invited to attend meetings
when appropriate to provide advice. However, no Director 
is present or takes part in discussions concerning their 
own remuneration.
Remuneration policy
The Company’s remuneration policy is that the remuneration
package of the Executive Directors should be sufficiently
competitive to attract, retain and motivate Directors to
achieve the Company’s objectives, without making
excessive payments. The remuneration and employment
terms of the Executive Directors are determined by the
Committee by comparison with salaries paid and terms
agreed with Directors in similar companies in the same
sector and of a similar size and after a review of the
performance of the individual.
It is the aim of the Committee to reward Executive
Directors competitively and on the broad principle that they
should be in the range of median to upper-quartile of
remuneration paid to senior management of comparable
public companies. For guidance, the Committee refers to
published survey data. The Board determines the terms
and conditions of non-executive Directors.
There are four main elements to the remuneration packages
of the Executive Directors and other senior executives:
• basic salary, including benefits;
• annual bonus awards;
• share option plans; and
• pension arrangements.
Basic salary
Basic salaries are reviewed annually by the Board in its
capacity as Remuneration Committee, and increased
where the Committee believes that adjustments are
appropriate to reflect performance, increased
responsibilities and/or market conditions. Other benefits for
Executive Directors include car allowances and certain
medical cover for the Director and immediate family. The
Company also has a permanent health insurance policy to
provide cover for the Executive Directors.
Annual bonus awards
The Company provides a bonus incentive scheme for
Directors and senior executives of the operating
companies, linked to the performance of the business for
which they are responsible. All performance criteria are
subject to approval by the Remuneration Committee before
payment is made. 
Share option plans
The Renew 2004 Executive Share Option Scheme (formerly
known as the Montpellier 2004 Executive Share Option
Scheme) (the “2004 ESOS”) approved at the Extraordinary
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19
General Meeting (“EGM”) held on 11 March 2004 replaced
The Lovell 1995 Executive Share Option Scheme. During
the year 761,904 options were granted under the 2004
ESOS to the Executive Directors. There are no other
options outstanding under the scheme. The Renew
Savings Related Share Option scheme (formerly known as
the Montpellier Savings Related Share Option Scheme) (the
“Renew SAYE”) also approved at the EGM on 11 March
2004 replaced the old SAYE scheme rules, which expired
on 20 January 2004. There are no options outstanding
under the latter scheme and no new grants have been
made under the Renew SAYE. 
The Company’s policy to grant options or awards under
the above schemes is at the Remuneration Committee’s
discretion as and when considered appropriate.
Pension arrangements
The Group provides retirement benefits for Executive
Directors and employees through independent pension
schemes. The assets of these schemes are held by trustees
and managed by independent investment managers. 
The retirement age of the Executive Directors is 65. Messrs.
May and Samuel are not members of these schemes and
do not receive pension contributions from the Company.
Service contracts and letters of appointment
The Company’s policy is for the Executive Directors to have
12-month rolling service contracts that provide for a 
12-month notice period. The non-executive Directors do not
have service contracts. The non-executive Directors have
letters of appointment concerning, amongst other things, the
initial terms for which they are appointed, a general statement
of their role and duties and the fees they will receive as a
Director. The fees of non-executive Directors are determined
by the full Board within the limits set out in the Memorandum
and Articles of Association. The non-executive Directors are
not eligible for bonuses, pension benefits, share options or
other benefits. The letters of appointment do not contain a
provision for termination payments. The Directors are
indemnified to the full extent permitted by Statute under the
Articles of Association. The service contracts and letters of
appointment of the Directors, who served during the year
ended 30 September 2006, include the following terms:
Directors Executive/ Letter or contract Date of contract Unexpired terms Notice period  
Non-executive of appointment or letter (months) (months)
J Bishop*** Non-executive Letter 4 October 2006 36 1
R Harrison Non-executive Letter 7 October 2005 24 1
B May Executive Contract 20 June 2005 Rolling one year 12
P Underwood* Executive Contract 29 April 2004 Rolling one year 12
J Samuel Executive Contract 17 May 2006 Rolling one year 12
A Wagner OBE** Non-executive Letter 25 November 2003 0 1
* P Underwood resigned as a Director on 1 May 2006 but remains an employee.
** A Wagner OBE resigned as a Director on 31 October 2006.
*** J Bishop was appointed on 1 October 2006.
Directors’ remuneration
Information is provided below for Directors who served during the financial year and as at 30 September 2006:
Notes Salary/fees Bonuses Benefits Pension Total Total
contributions emoluments emoluments
2006 2005
£000 £000 £000 £000 £000 £000
Executive Directors
B May 2, 3 & 4 250 138 22 25 435 56
J Samuel 3 & 4 83 46 7 8 144 -
P Underwood 3 & 4 110 74 10 13 207 298
R Harrison 1----- 250
Former Directors 2----- 389
786 993
Non-executive Directors
Fees
R Harrison 1 50 - - - 50 -
A Wagner OBE 25 - - - 25 25
75 25
87379_RENEW_R&A_2006_TEXT PAGE 19
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20
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 20
1. R Harrison’s appointment reverted to non-executive Chairman with effect from 1 October 2005. He was issued with a
replacement service letter dated 7 October 2005 at a salary of £50,000 p.a. and a review date of 1 October 2007.
2. The highest paid Director for 2006 was B May who received emoluments of £410,000 (excluding pension contributions)
and the highest paid Director for 2005 was J Gaffney who received emoluments of £365,000 (excluding pension
contributions of £24,000) and who resigned on 30 August 2005. 
3. Benefits include car allowances and certain medical cover for the Director and immediate family. 
4. Messrs. May, Samuel and Underwood received salary payments in lieu of Company pension contributions, which are
paid through payroll and taxed as salary.
Directors’ share options
Options were granted to Messrs. May and Samuel under the Renew ESOS on 7 June 2006 as set out in the table below. No
other options lapsed, were exercised or were awarded during 2005 or 2006. The market price of the Company’s shares at
30 September 2006 was 61.5p and the range of market prices during the year was between 33.25p and 62p.
Information is provided below for Directors who served during the financial year and as at 30 September 2006:
Number of options Number of options Date of Exercise Earliest Expiry of
at start of year at end of year award/grant price £ exercise date exercise period
1 October 2005 30 September 2006
Executive Directors
B May - 476,190 7 June 2006 0.525 8 June 2009 8 June 2016
J Samuel - 285,714 7 June 2006 0.525 8 June 2009 8 June 2016
Directors’ share interests
Those Directors serving at the end of the year had interests in the share capital of the Company at 30 September 2006 
as follows:
Ordinary Shares of £0.10 each
30 September 2006 30 September 2005
R Harrison 60,000 60,000
B May 105,000 105,000
J Samuel 130,000 -
A Wagner OBE 40,000 40,000
Directors’ pension information
No Director had pension entitlements under the Company’s defined benefit pension scheme. 
Approval
The Directors’ Remuneration Report was approved by the Board on 28 November 2006 and signed on its behalf by:
R Harrison
Chairman
87379_Renew_R&A_2006_Text.qxp  8/12/06  17:07  Page 20 CORPORATE GOVERNANCE
21
As an AIM listed company, Renew is not required to follow
the provisions of the Combined Code, as set out in the
Financial Services Authority’s Listing Rules. The Directors,
however recognise the importance of and accordingly
support the principles of, good corporate governance as
contained within the Combined Code. Because of this the
Directors would normally seek to follow the Code to the
extent considered relevant for an AIM listed company but
have been unable to achieve compliance with the Code in
a number of areas this year, primarily because of the lack
of independent non-executive Directors for much of the
year and to date. These matters are explained in further
detail in the sections below. 
The Board of Directors
The Board currently comprises the Chief Executive Officer,
the non-executive Chairman, one Executive Director and
one independent non-executive Director. Brief biographies
of the Directors are given on page 17.
As the Company has only had one independent non-
executive Director within the meaning of the Code during
the year, it has not been compliant with the requirement of
the Code that more than half of the Board should be
comprised of independent non-executive Directors. 
The composition of the Board is reviewed regularly. The
Board identified the need for both additional Executive and
non-executive Directors. The Board in its capacity as
Nomination Committee considered internal and external
candidates leading to the appointment of a new Group
Finance Director during the year, and after the year end,
the appointment of John Bishop as a non-executive
Director. Appropriate training, briefings and induction are
available to all Directors on appointment and subsequently
as necessary, taking into account existing qualifications and
experience. New Directors are subject to election by
shareholders at the first AGM after their appointment.
The Board met formally 10 times in the year plus Committee
meetings dealing with the daily business of the Company
being held as necessary. The Board receives written and
oral reports from the Executive Directors ensuring matters
are considered fully and enabling Directors to discharge
their duties properly. There is a formal schedule of matters
reserved for the Board’s decision ensuring the maintenance
of control over strategic, financial and operational matters.
In addition, the Directors have access to the advice and
services of the Company Secretary and procedures are in
place for them to seek independent professional advice, if
necessary, at the Company’s expense.
Board Committees
Following the appointment of R Harrison as Executive
Chairman on 24 March 2004, A Wagner OBE became the
sole independent non-executive Director and the Audit,
Remuneration and Nomination Committees were rendered
inquorate. The Board therefore decided in July 2004 to
temporarily suspend all Committees. Since the Committees
were rendered inquorate any matters normally reserved for
consideration by the Committees have been decided upon
by the full Board, with any individual having a personal
interest in the matter under consideration not taking part in
the meeting. As at 1 October 2005, R Harrison reverted to
non-executive Chairman. However, his role as an Executive
Director prevents him from being considered as
independent under the Combined Code 2003. The Board
has decided, therefore, to continue to consider the above
Committee matters as a full Board and will re-instate the
Committees as soon as it is in a position to do so.
In normal circumstances the Board delegates clearly defined
powers to its Audit, General Purposes, Remuneration and
Nomination Committees. Each of the Board’s Committees
has carefully drafted terms of reference. 
The Remuneration Committee determines and agrees with
the Board the framework and policy of executive
remuneration packages, including bonuses, incentive
payments, share options or awards and pension
arrangements. Further information concerning the
Remuneration Committee is set out in the Directors’
Remuneration Report on pages 18 to 20.
The Nomination Committee monitors the composition of the
Board and recommends the appointment of new Directors.
The Board in its capacity as Nomination Committee has held
two meetings during the year to discuss nomination matters.
The Nomination Committee terms of reference include:
(a) To review the structure, size and composition of 
the Board;
(b) To consider succession planning for Directors and 
senior executives;
(c) To identify and nominate, for approval by the Board,
suitable candidates to fill Board vacancies;
(d) To make recommendations to the Board on the
contents of letters of appointment, Directors’ duties, 
re-appointment or re-election of Directors upon
conclusion of a specified term or retirement 
by rotation.
The Company ceased to comply with the Code guidance
(Section C 3.1) that the Audit Committee should comprise
of at least two non-executive Directors following the
appointment of R Harrison as an Executive Director. The
Board in its capacity as Audit Committee has held five
meetings to consider Audit Committee business. The
Directors propose to appoint John Bishop as Chairman of
the Board for the purposes of Audit Committee business
following the approval of the 2006 accounts. In normal
circumstances the Audit Committee considers the
87379_RENEW_R&A_2006_TEXT PAGE 21
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22
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 22
adequacy and effectiveness of the risk management and
control systems of the Group, and reports the results to the
Board. It reviews the scope and results of the external
audit, its cost effectiveness and the objectivity of the
Auditors. The Audit Committee monitors the non-audit
work performed by the Auditors to help ensure that the
independence of the Auditors is maintained. The Audit
Committee also reviews the interim statement, the
preliminary announcement and accounting policies. 
The General Purposes Committee is constituted by two
Executive Directors and considers routine day-to-day
business decisions, which are then reported to the Board. 
Internal controls
Throughout the financial year to 30 September 2006 and
up to the date of approval of the Report and Accounts, the
Group has fully complied with the relevant provisions of the
Code and the Turnbull guidance. The Directors
acknowledge that they have overall responsibility for the
Group’s system of internal control and for reviewing and
monitoring its effectiveness. The system of internal control
is designed to manage and mitigate, rather than eliminate,
the risks to which the Company is exposed and therefore
provides a reasonable, but not absolute, assurance against
a company failing to meet its business objectives or against
material misstatement or loss. Consequently, the Board
confirms that there is an ongoing process for identifying,
evaluating and managing significant risks faced by the
Group and that it is regularly reviewed by the Board. 
The Group operates a risk management process, which is
embedded in normal management and governance
processes. There is a system of self-examination of risk
areas and controls by subsidiaries and departments within
the Group. Where significant risks are identified, the
probability of those risks occurring, their potential impact and
the plans for managing and mitigating each of those risks is
reported. The Group operates a series of controls which
include the annual strategic planning and budgeting process,
short-term cash monitoring achieved by means of weekly
forecasts, which are compared against budget and previous
forecasts, clearly defined capital investment guidelines and
levels of authority, a clear organisational structure within
which individuals’ responsibilities are identified and
monitored. These results and processes are monitored,
updated, reviewed and considered by the Board.
Due to the size and nature of the Group, the Board does
not consider that an internal audit function is necessary;
however, it is continuing to review this position.
Going concern
After making enquiries, the Directors consider that at the
time of approving the financial statements, there is a
reasonable expectation that the Company and the Group 
have adequate resources to continue in operational
existence for the foreseeable future. For this reason, they
continue to adopt the going concern basis in preparing the
financial statements.
Directors’ remuneration
The Company’s policy on the remuneration of Executive
Directors, and information relating to the Directors’
remuneration and their interests in share options, is
included in the Directors’ Remuneration Report.
Directors and officers indemnity
Article 144 of the Articles of Association provides that each
Director or other officer or Auditor of the Company shall be
indemnified by the Company against losses, costs and
expenses he may sustain or incur in connection with the
performance of his duties of office, to the fullest extent
permitted by law. 
Shareholder relationships
Members of the Board have dialogue with individual
shareholders during the year. In addition to the Annual and
Interim Report and Accounts, the Chairman addresses
shareholders at the AGM and invites questions to any
members of the Board.
The AGM is normally attended by all Directors and provides
an opportunity for communication with those shareholders
attending. Notice of the AGM is given to shareholders at
least 21 days in advance and separate resolutions are
proposed on each substantially separate issue. Where
resolutions at the AGM are dealt with by show of hands, the
results of proxy votes for and against are still announced. 
Financial and other information about the Company is
available on the Company’s website:
www.renewholdings.com from which shareholders can also
access their shareholding details via a link to the website of
Capita Registrars plc.
Annual General Meeting
The AGM will be held on 24 January 2007, the Notice for
which is set out on page 54. The Notice contains special
business, including the renewal of the Board’s power to
allot equity shares. Brief details of the purpose and effect of
the proposed resolutions are set out on page 55 of the
notes to the Notice of AGM. Shareholders should complete
the proxy form accompanying this document in
accordance with the notes contained in the Notice of AGM. 
Approval
The Board approved the Corporate Governance Report on 
28 November 2006.
By Order of the Board
Catherine Wright LLB FCIS
Company Secretary
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23
Statement of Directors’ responsibilities 
The Directors are responsible for preparing the Annual
Report and the financial statements in accordance with
applicable law and regulations.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law, the
Directors have elected to prepare the financial statements
in accordance with United Kingdom Generally Accepted
Accounting Practice (United Kingdom Accounting
Standards and applicable law). The financial statements are
required by law to give a true and fair view of the state of
affairs of the Company and the Group and of the profit or
loss of the Group for that period. In preparing these
financial statements, the Directors are required to:
• select suitable accounting policies and then apply 
them consistently;
• make judgements and estimates that are reasonable 
and prudent;
• state whether applicable United Kingdom accounting
standards have been followed, subject to any material
departures disclosed and explained in the accounts;
and
• prepare the accounts on the going concern basis
unless it is inappropriate to presume that the Company
will continue in business.
The Directors are responsible for keeping proper accounting
records which disclose with reasonable accuracy at any time
the financial position of the Company and the Group and
enable them to ensure that the financial statements comply
with the Companies Act 1985. They are also responsible for
safeguarding the assets of the Company and the Group and
hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
The Directors are responsible for the maintenance and
integrity of the corporate and financial information on the
Group’s website. Legislation in the United Kingdom
governing the preparation and dissemination of the financial
statements and other information included in annual
reports may differ from legislation in other jurisdictions.
87379_RENEW_R&A_2006_TEXT PAGE 23
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Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 24
INDEPENDENT AUDITORS’ REPORT
Independent Auditors’ Report to the Shareholders 
of Renew Holdings plc for the year ended 
30 September 2006
We have audited the financial statements on pages 25 to
51. These financial statements have been prepared under
the accounting policies set out therein.
This Report is made solely to the Company’s shareholders,
as a body, in accordance with section 235 of the
Companies Act 1985. Our audit work has been undertaken
so that we might state to the Company’s shareholders
those matters we are required to state to them in an
Auditors’ Report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company and the
Company’s shareholders as a body, for our audit work, for
this report, or for the opinions we have formed.
Respective responsibilities of Directors and Auditors
The Directors’ responsibilities for preparing the Annual
Report and the financial statements in accordance with
applicable law and United Kingdom Accounting Standards
(United Kingdom Generally Accepted Accounting Practice)
are set out in the Statement of Directors’ Responsibilities.
Our responsibility is to audit the financial statements in
accordance with relevant legal and regulatory requirements
and International Standards on Auditing (UK and Ireland).
We report to you our opinion as to whether the financial
statements give a true and fair view and have been
properly prepared in accordance with the Companies Act
1985. We also report to you whether in our opinion the
information given in the Directors’ Report is consistent with
the financial statements.
In addition we report to you if, in our opinion, the
Company has not kept proper accounting records, if we
have not received all the information and explanations we
require for our audit, or if information specified by law
regarding Directors’ remuneration and other transactions is
not disclosed.
We read other information contained in the Annual Report
and consider whether it is consistent with the audited
financial statements. The other information comprises only
the Directors’ Report, the Chairman’s Statement, the Chief
Executive’s Review and the Corporate Governance
Statement. We consider the implications for our report if
we become aware of any apparent misstatements or
material inconsistencies with the financial statements. 
Our responsibilities do not extend to any other information.
Basis of audit opinion
We conducted our audit in accordance with International
Standards on Auditing (UK and Ireland) issued by the
Auditing Practices Board. An audit includes examination,
on a test basis, of evidence relevant to the amounts and
disclosures in the financial statements. It also includes an
assessment of the significant estimates and judgements
made by the Directors in the preparation of the financial
statements, and of whether the accounting policies are
appropriate to the Group’s circumstances, consistently
applied and adequately disclosed.
We planned and performed our audit so as to obtain all the
information and explanations which we considered
necessary in order to provide us with sufficient evidence to
give reasonable assurance that the financial statements are
free from material misstatement, whether caused by fraud
or other irregularity or error. In forming our opinion we also
evaluated the overall adequacy of the presentation of
information in the financial statements.
Opinion
In our opinion:
• the financial statements give a true and fair view of the
state of affairs of the Company and the Group as at 
30 September 2006 and of the Group’s profit for the
year then ended;
• the financial statements have been properly prepared in
accordance with the Companies Act 1985; and
• the information given in the Directors’ Report is
consistent with the financial statements.
RSM Robson Rhodes LLP
Chartered Accountants and Registered Auditors
Birmingham
28 November 2006
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87379_RENEW_R&A_2006_TEXT PAGE 25
GROUP PROFIT & LOSS ACCOUNT
For the year ended 30 September 2006
Turnover: Group & share of joint ventures 365,266 457,750
Less share of joint ventures’ turnover (2,823) (2,714)
Ongoing operations 341,698 330,113
Discontinuing operations 20,745 39,052
Total continuing operations 362,443 369,165
Discontinued operations - 85,871
Group turnover 2 (a) 362,443 455,036
Cost of sales 2 (b) (328,393) (437,409)
Gross profit 34,050 17,627
Administrative expenses 2 (b) (30,577) (37,689)
Other operating income 3 - 53
Group operating profit/(loss) 3,473 (20,009)
Income from joint ventures - -
Profit from ongoing operations before exceptional items 3,473 2,687
Exceptional items 2 (c) - (19,845)
Profit/(loss) from ongoing operations after exceptional items 2 (b) 3,473 (17,158)
Profit/(loss) from discontinuing operations 2 (b) - (8,351)
Total profit/(loss) from continuing operations 2 (b) 3,473 (25,509)
Profit from discontinued operations 2 (b) - 5,500
Total operating profit/(loss) before interest, including share of joint ventures 2 (b) 3,473 (20,009)
Profit on disposal of subsidiary company 2 (d) - 22,300
Profit on ordinary activities before interest 3,473 2,291
Interest receivable 1,561 921
Interest payable 4 (1,437) (1,597)
Other finance income/(charges) - FRS 17 pension 4 1,042 (440)
Profit on ordinary activities before taxation 4,639 1,175
Taxation credit on ordinary activities 6 1,349 899
Profit for the financial year 5,988 2,074
Basic earnings per Ordinary Share 8 10.00p 3.46p
Diluted earnings per Ordinary Share 8 9.95p 3.46p
Note Total Total
2006 2005
£000 £000
Profit for the financial year 5,988 2,074
Dividends paid 7 (360) -
Exchange movement in reserves 22 (119) (171)
Movements in defined benefit pension scheme 28 (6,175) (1,216)
Movement on deferred tax relating to the defined benefit pension scheme 1,186 (1,006)
Total recognised gains and losses for the year 520 (319)
Note Total Total
2006 2005
£000 £000
GROUP STATEMENT OF TOTAL RECOGNISED GAINS & LOSSES
For the year ended 30 September 2006
87379_Renew_R&A_2006_Text.qxp  8/12/06  17:07  Page 25 BALANCE SHEETS
At 30 September 2006
Fixed assets
Intangible assets: Goodwill 9 4,527 4,602 - -
Tangible assets 10 3,819 14,930 209 298
Investments 11 - - 83,672 83,672
Investments in joint ventures: 12
Loans to joint ventures 561 438 - -
Share of gross assets 4,429 9,704 - -
Share of gross liabilities (1,722) (5,276) - -
3,268 4,866 - -
11,614 24,398 83,881 83,970
Current assets
Stocks and work in progress 13 18,673 9,573 - -
Debtors: due after more than one year 14 4,346 5,751 - 580
Debtors: due within one year 14 77,093 72,836 23,987 24,951
Current asset investments 15 - 6,089 - 6,089
Cash at bank and in hand 16 19,735 13,590 13,951 15,579
119,847 107,839 37,938 47,199
Creditors: amounts falling due in less than one year 17 (121,555) (115,020) (105,473) (113,641)
Net current liabilities (1,708) (7,181) (67,535) (66,442)
Total assets less current liabilities 9,906 17,217 16,346 17,528
Creditors: amounts falling due after more than one year
Long-term debt 18 - (8,363) - -
Other creditors 19 (1,821) (4,058) - -
Net assets excluding pension liability 8,085 4,796 16,346 17,528
Pension liability 28 (2,769) - - -
Net assets 5,316 4,796 16,346 17,528
Capital and reserves
Share capital 21 5,990 5,990 5,990 5,990
Share premium account 22 5,893 5,893 5,893 5,893
Capital redemption reserve 22 3,896 3,896 3,896 3,896
Revaluation reserve 22 73 73 73 73
Profit and loss account 22 (10,536) (11,056) 494 1,676
Equity shareholders’ funds 23 5,316 4,796 16,346 17,528
Approved by the Board and signed on its behalf by:
R Harrison
Chairman
28 November 2006
Note Group Group Company Company
(restated) (restated)
2006 2005 2006 2005
£000 £000 £000 £000
26
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 26
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87379_RENEW_R&A_2006_TEXT PAGE 27
GROUP CASH FLOW STATEMENT
For the year ended 30 September 2006
Net cash inflow/(outflow) from operating activities 29 10,661 (25,338)
Returns on investments and servicing of finance
Interest received 1,561 921
Interest paid (1,437) (1,597)
124 (676)
Taxation
Net corporation tax paid (36) -
Capital expenditure and financial investment
Payments to acquire tangible fixed assets (1,291) (640)
Proceeds on sale of tangible fixed assets 393 225
Loans (advanced to)/repaid by joint ventures (149) 200
(1,047) (215)
Acquisitions and disposals
Acquisition of a subsidiary, net of cash acquired (664) -
Proceeds from sale of subsidiaries and businesses - 21,343
Proceeds from sale of equity loans - 1,894
Cash obtained/(disposed) on acquisition/(disposal) of subsidiaries and businesses 65 (3,380)
(599) 19,857
Equity dividends paid to shareholders (360) -
Cash inflow/(outflow) before financing 8,743 (6,372)
Financing
Movement in short-term borrowings (3,600) 3,600
Repayment of mortgage (8,363) -
Additional development loans 9,795 -
Finance lease payments (686) (623)
(2,854) 2,977
Increase/(decrease) in cash during the year 5,889 (3,395)
Reconciliation of net cash flow to movement in net funds
Increase/(decrease) in cash during the year 5,889 (3,395)
Movement in borrowings 2,556 (2,977)
Changes in net funds arising from cash flows 8,445 (6,372)
Other non-cash movements 256 (1,680)
Movement in net funds during the year 8,701 (8,052)
Opening net funds 269 8,321
Closing net funds 8,970 269
Note Total Total
2006 2005
£000 £000
87379_Renew_R&A_2006_Text.qxp  8/12/06  17:07  Page 27 NOTES TO THE ACCOUNTS
(i) Basis of accounting
The accounts have been prepared on the going concern
basis and in accordance with applicable accounting
standards under the historical cost convention, modified by
the revaluation of certain long leasehold land and buildings
updated for the adoption of FRS 21 and FRS 25. Dividend
distributions are now recognised as a liability in the period
in which they are approved by the Company’s shareholders
and have necessitated the restatement of the accounts. A
summary of the more important Group accounting policies,
which have been applied consistently is set out below.
(ii) Basis of consolidation
The Group accounts consolidate the accounts of the
Company and its subsidiary undertakings and include the
attributable share of the results and net assets of joint
ventures. The results and net assets of undertakings
acquired are included in the Group profit and loss account
and balance sheet using the acquisition method of
accounting from the effective date of acquisition. The
results of undertakings disposed of are included to the
effective date of disposal. Subsidiary undertakings have
been consolidated using the acquisition method of
accounting and joint ventures are included in accordance
with the accounting policies noted below.
(iii) Joint ventures
In the normal course of business the Group invests in joint
ventures which are classified as fixed asset investments.
Joint ventures arise where the Group has a participating
interest in an entity and shares the control of its strategic
and operating policies. Joint ventures are accounted for
using the gross equity method of accounting. Where
necessary, adjustments are made on consolidation to bring
the results and net assets of joint ventures into line with
Group accounting policies.
(iv) Investments in subsidiaries
Investments in subsidiaries are recorded at cost less
provision for impairment.
(v) Goodwill
Goodwill is the difference between the amount paid on the
acquisition of a business and the aggregate fair value of its
separable net assets. Goodwill arising on acquisitions prior
to 30 September 1997 has been written off directly against
the profit and loss reserve and has not been reinstated on
implementation of FRS 10 “Goodwill and intangible assets”
as allowed by the standard. Goodwill arising on acquisition
of subsidiaries after 1 October 1997 is capitalised in the
balance sheet and is being amortised over its estimated
useful economic life up to a maximum of 20 years.
Reviews for impairment of goodwill are performed at the
end of the first full financial year following the related
acquisition and, thereafter, if events indicate that the
carrying value may not be recoverable. On the sale of a
subsidiary undertaking any goodwill relating to the
disposed subsidiary is written off in the year.
(vi) Long-term contracts
Long-term contracts are stated at cost plus attributable
profit after providing for anticipated future losses and
contingencies. Progress payments received are deducted
from these amounts. Cost includes attributable overheads.
Long-term contract work in progress is recorded in turnover
on a monthly basis as the contract proceeds and therefore
is included in debtors as amounts recoverable on contracts.
(vii) Stocks and work in progress
Stocks and work in progress comprise developments and
land held for development and raw materials and are
stated at the lower of cost and net realisable value. Cost
includes appropriate attributable overheads and excludes
interest. Where necessary, provision is made for obsolete,
slow moving and defective stocks.
(viii) Current asset investments
Current asset investments are stated at the lower of cost
and net realisable value.
(ix) Tangible fixed assets
Tangible fixed assets are recorded at cost or valuation for
certain properties, less provision for impairment if required.
Depreciation is provided on all tangible fixed assets, other
than investment properties. Provision is made at rates
calculated to write off the cost of each asset, less estimated
residual value, evenly over its expected useful life as follows:
• Group occupied property
Freehold land and buildings - fifty years
Long leasehold land - shorter of fifty years 
and buildings and remainder of lease
• Plant and vehicles - three to ten years
• Office equipment - two to seven years
Changes in the revalued amounts of assets carried at
valuations are taken directly to the revaluation reserve.
Upon disposal, the balance of any revaluation reserve
relating to the property sold is transferred to the profit 
and loss account in reserves.
28
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 28
1 ACCOUNTING POLICIES
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87379_RENEW_R&A_2006_TEXT PAGE 29
NOTES TO THE ACCOUNTS
1 ACCOUNTING POLICIES (continued)
The landfill developments owned by the Group were
included in tangible fixed assets at open market valuation
for existing use within these accounts. Depreciation was
charged at a rate that matched the net income derived
from the landfill operation until the asset was completely
written down. Full provision was made for the net present
value of the Group’s landfill site rectification costs. An asset
was also recognised in relation to these future costs, which
has been amortised on the basis of tonnages deposited
over the expected useful life of the site.
(x) Deferred taxation
The payment of taxation is deferred or accelerated
because of timing differences between treatment of certain
items for accounting and taxation purposes. Full provision
for deferred taxation is made under the liability method,
without discounting, on timing differences that have arisen,
but not reversed by the balance sheet date, unless such
provision is not permitted by FRS 19 “Deferred tax”.
Deferred tax assets are recognised to the extent it is
considered more likely than not that they will be recovered.
In accordance with FRS 19 deferred tax is not provided in
respect of:
(a) revaluation gains on land and buildings, unless there 
is a binding agreement to sell them at the balance 
sheet date; 
(b) gains on the sale of non-monetary assets, if the taxable
gain will probably be rolled over; 
(c) fair value adjustment gains to fixed assets and stock to 
uplift prices to those ruling when an acquisition is made;
(d) extra tax payable if the overseas retained profits of 
subsidiaries, joint ventures or associates are remitted 
in the future.
Deferred tax assets are recognised for taxable losses
relating to trading to the extent that those losses are
expected to be recoverable within the foreseeable future,
and also in respect of the pensions deficit recorded under
FRS 17 where the Directors consider that the asset will be
utilised by the expected profitability of the Group.
(xi) Turnover
Turnover, which excludes sales within the Group and 
Value Added Tax, comprises:
• value of work executed during the year on 
construction contracts;
• sales of properties and land based upon 
legal completions.
(xii) Foreign currencies
Transactions in foreign currencies are recorded at the rate
ruling at the date of the transaction or at the contracted
rate if the transaction is covered by a forward exchange
contract. Monetary assets and liabilities denominated in
foreign currencies are retranslated at the rate of exchange
ruling at the balance sheet date or, if appropriate, at the
forward contract rate. The accounts of overseas subsidiary
and joint venture undertakings are translated at the rate of
exchange ruling at the balance sheet date. The exchange
difference arising on the retranslation of the opening net
assets is taken directly to reserves together with differences
on foreign currency borrowings to the extent that they are
used to finance or provide a hedge against Group equity
investments in foreign enterprises. All other exchange
differences are taken to the profit and loss account.
(xiii) Leasing commitments
Assets held under finance leases, where substantially all
the benefits and risks of ownership of an asset have been
transferred to the Group, are capitalised and are
depreciated in accordance with the depreciation policy for
the relevant class of asset or the remaining lease term if
shorter. The interest element of the rental obligation is
charged to the profit and loss account and represents a
constant proportion of the balance of capital repayments
outstanding. Rentals under operating leases are charged
to the profit and loss account on a straight-line basis over
the term of the lease.
(xiv) Defined benefit pension scheme
The Group has fully adopted the requirements of FRS 17
“Retirement Benefits”. The defined benefit scheme was
closed to new members in June 2000 and in August 2001
the Board decided that no further benefits would accrue to
existing members with more than five years expected
service life remaining. These members were transferred to
the defined contribution plan but retained the benefit
earned to that date under the defined benefit scheme. The
pension scheme assets are measured using market values.
Pension scheme liabilities are measured using the
projected unit actuarial method and are discounted at the
current rate of return on a high quality corporate bond of
equivalent term and currency to the liability. Any increase in
the present value of liabilities within the Group’s defined
benefit scheme expected to arise from employee service in
the period is charged to operating profit. The expected
return on the scheme’s assets and the increase during the
period in the present value of the scheme’s liabilities arising
from the passage of time are included in other finance
income. Actuarial gains and losses are recognised in the
consolidated statement of total recognised gains and losses.
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30
1 ACCOUNTING POLICIES (continued)
Pension scheme surpluses, to the extent they are
considered recoverable (under the guidance of FRS 17), or
deficits are recognised in full and presented on the face of
the balance sheet net of related deferred tax.
Further information on the structure of the defined benefit
scheme is contained within note 28 of these accounts.
(xv) Defined contribution pension scheme
Contributions to the defined contribution scheme are
charged to the profit and loss account as incurred.
2 (a) SEGMENTAL ANALYSIS
External turnover is analysed as follows:
Construction businesses 338,187 450,367
Other 27,079 7,383
Turnover: Group and share of joint ventures’ turnover 365,266 457,750
Less: Share of joint ventures’ turnover (2,823) (2,714)
External turnover 362,443 455,036
Analysed as to:
Ongoing operations 341,698 330,113
Discontinuing operations 20,745 39,052
Continuing operations 362,443 369,165
Discontinued operations - 85,871
External turnover 362,443 455,036
The Directors have not disclosed segmental information relating to the profits/(losses) and net assets since they are of the
opinion that to fully comply with the requirements of SSAP 25 “Segmental Reporting” would be seriously prejudicial to the
interests of the Group.
2006 2005
£000 £000
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 30
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87379_RENEW_R&A_2006_TEXT PAGE 31
NOTES TO THE ACCOUNTS
Group turnover 341,698 20,745 362,443 330,113 39,052 85,871 455,036
Cost of sales (308,017) (20,376) (328,393) (316,373) (43,600) (77,436) (437,409)
Gross profit 33,681 369 34,050 13,740 (4,548) 8,435 17,627
Administrative expenses (30,208) (369) (30,577) (30,951) (3,803) (2,935) (37,689)
Other operating income - - - 53 - - 53
Group operating profit/(loss)
before exceptional items 3,473 - 3,473 2,687 (2,045) 5,500 6,142
Exceptional items - - - (19,845) (6,306) - (26,151)
Group operating profit/(loss)
after exceptional items 3,473 - 3,473 (17,158) (8,351) 5,500 (20,009)
Income from joint ventures - - - - - - -
Total operating profit/(loss)
before interest, including
share of joint ventures 3,473 - 3,473 (17,158) (8,351) 5,500 (20,009)
Profit on disposal of
subsidiary undertakings - 22,300
Profit on ordinary activities
before interest 3,473 2,291
(i) Discontinuing operations
Discontinuing operations relates to the activities of YJL Construction (excluding YJL Infrastructure). In 2005, discontinuing
operations included the shopfitting activities of Britannia Joinery. This activity is shown as discontinuing as it does not meet
the definition of discontinued as defined by FRS 3.
(ii) Discontinued operations
Discontinued operations relates to the activities of Bullock Construction Limited, which was sold on 16 September 2005
(as detailed in note 26).
2006 2005
Ongoing Discontinuing Total Ongoing Discontinuing Discontinued Total
Activities Activities Activities Activities Activities
£000 £000 £000 £000 £000 £000 £000
2 (b) ANALYSIS OF OPERATIONS
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32
2 (c) OPERATING EXCEPTIONAL ITEMS
The operating profit/(loss) includes the following amounts that the Directors regard as exceptional because of their value
and nature, but which do not fall to be recorded as non-operating exceptional items under the requirements of FRS 3
“Reporting Financial Performance”.
Reduction in pension deficit following
settlement of liabilities (i) -- 3,650 -
Cost of incentives to members connected
to the settlements (i) -- (1,111) -
-- 2,539 -
Contract losses on specific problem
contracts incepted in prior years (ii) - - (15,437) (4,758)
Impairment of fixed assets and current asset investments (iii) - - (1,749) -
Redundancy and reorganisation costs (iv) - - (454) (1,289)
Other non-recurring costs (v) - - (4,744) -
Closure costs (vi) - - - (259)
- - (19,845) (6,306)
With the exception of contract losses, which have been included within cost of sales, all of the exceptional (charges)/credits
have been included within administrative expenses.
(i) Defined benefit pension scheme
During the year ended 30 September 2005, the Directors made a number of offers to deferred members of the scheme to
transfer their entitlements under the defined benefit scheme to a defined contribution arrangement and a number of offers
to pensioners of the scheme to buy out certain benefits attributable under the scheme. The figure recorded above shows
the movement on the FRS 17 actuarial deficit relating to these transfers and the costs reflect the sums paid to facilitate
these transfers.
(ii) Contract losses
During the year ended 30 September 2005, the Group suffered a number of contractual issues that related to contracts
procured during or before 2002/2003 where the difficulties relating to these contracts were not identified in prior periods.
(iii) Impairment of fixed assets and current asset investments
Provision was made in the year ended 30 September 2005 against the value of certain properties.
(iv) Redundancy and reorganisation costs 
During the year ended 30 September 2005, a number of exceptional costs, which primarily related to redundancies, were
incurred as a result of reorganisations within the Group which did not constitute a fundamental reorganisation as defined
by FRS 3.
(v) Other non-recurring costs
During the year ended 30 September 2005, the Group incurred £4.7m of non-recurring costs in respect of the resolution
of legacy non-contract issues.
(vi) Closure costs
Provision in respect of the remaining costs of discontinuing YJL Construction’s contracting division.
Year ended 30 September 2006 Year ended 30 September 2005
Ongoing Discontinuing Ongoing Discontinuing
£000 £000 £000 £000
Annual Report & Accounts 2006
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Profit on disposal of subsidiary companies - 22,300
Profit on disposal of subsidiary companies in year ended 30 September 2005 relates to the sale of 
Bullock Construction Limited - further details are set out in note 26.
2 (e) COMPANY PROFIT AND LOSS ACCOUNT
As permitted by Section 230 of the Companies Act 1985, the Company has not presented its own profit and loss
account. The loss after taxation for the financial year dealt with in the accounts of the Company was £1,182,000 
(2005: profit £9,065,000).
3 OPERATING PROFIT
Operating profit is arrived at after charging/(crediting)
Auditors’ remuneration - audit services (Company £74,000; 2005: £89,000) 193 210
Depreciation of owned assets 1,113 2,089
Depreciation of assets held under finance leases 410 568
Amortisation of goodwill 306 303
Impairment of current asset investments - 1,299
Impairment of long leasehold assets - 450
Operating lease rentals - Plant and machinery 33 278
Operating lease rentals - Motor vehicles 306 365
Operating lease rentals - Other 3,400 3,437
Rental income (2,158) (2,273)
Profit on sale of fixed assets - (78)
Profit on sale of current asset investments (544) -
Foreign exchange losses 163 500
Other operating income comprises:
Overage payments - 13
Other income - 40
- 53
During the period, the following services were provided by the Group auditor:
Fees payable to the Company’s Auditor for the audit of the financial statements 74 89
Fees payable to the Company’s Auditor and its associates for other services:
Audit of the financial statements of the Company’s subsidiaries pursuant to legislation 119 121
Services related to corporate finance transactions - 142
Other services related to taxation 64 70
257 422
Year ended Year ended
30 September 30 September
2006 2005
£000 £000
2006 2005
£000 £000
2006 2005
£000 £000
NOTES TO THE ACCOUNTS
2 (d) NON-OPERATING EXCEPTIONAL ITEMS
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34
4 INTEREST PAYABLE AND OTHER FINANCE INCOME/(CHARGES)
Interest payable:
On bank loans and overdrafts 1,375 1,313
Other interest payable 62 284
1,437 1,597
Other finance income/(charges) - FRS 17 pension
Expected return on scheme assets 6,452 5,431
Interest on scheme liabilities (5,410) (5,871)
1,042 (440)
Further information on the pension scheme is set out in Note 28 to the accounts.
5 EMPLOYEE NUMBERS AND REMUNERATION
The average monthly number of employees,
including Executive Directors, during the year was: 1,322 1,794
At 30 September: 1,326 1,378
The analysis of the average monthly number of employees, including Executive Directors, during the year was:
Continuing 1,293 1,306
Discontinuing 29 83
Discontinued - 405
1,322 1,794
Cost of staff, including Executive Directors, during the year amounted to:
Wages and salaries 48,598 59,450
Social security costs 5,223 6,392
Other pension costs 1,207 1,972
55,028 67,814
Details of individual Directors’ emoluments and pension contributions can be found on pages 19 and 20. 
2006 2005
£000 £000
2006 2005
Number Number
2006 2005
£000 £000
2006 2005
Number Number
Annual Report & Accounts 2006
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87379_RENEW_R&A_2006_TEXT PAGE 35
(a) Analysis of credit in year
Current tax:
UK corporation tax on profits of the year - -
Adjustments in respect of previous periods (74) 1
(74) 1
Foreign tax (2) -
Total current tax (76) 1
Deferred tax 1,425 898
Taxation credit on profit on ordinary activities 1,349 899
(b) Factors affecting tax credit for the year
Profit on ordinary activities before taxation 4,639 1,175
Profit on ordinary activities multiplied by the standard rate
of corporation tax in the UK of 30% (2005: 30%) (1,392) (353)
Effects of:
Income not subject to tax 549 6,690
Expenses not deductible for tax purposes (499) (2,144)
Accelerated capital allowances - 140
Tax deductible expenses charged to reserves 353 -
Foreign tax (2) -
Net creation of tax losses 989 (4,333)
Adjustments to tax charge in respect of previous periods (74) 1
Current tax (charge)/credit for the year (76) 1
The Group and Company have available further unused tax losses to carry forward against future taxable profits.
A substantial element of these losses relates to activities which are not forecast to generate the level of profits
needed to utilise these losses. A deferred tax asset has been provided to the extent considered reasonable
by the Directors, where recovery is expected to be recognisable within the foreseeable future.
(c) Deferred tax
Accelerated capital allowances (90) (260)
Tax losses 2,989 1,734
2,899 1,474
(d) Reconciliation of deferred tax asset
As at 1 October 1,474 576
Origination of timing differences 1,425 898
At 30 September 2,899 1,474
2006 2005
£000 £000
2006 2005
£000 £000
2006 2005
£000 £000
2006 2005
£000 £000
NOTES TO THE ACCOUNTS
6 TAXATION CREDIT ON ORDINARY ACTIVITIES
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36
Interim (related to the year ended 30 September 2006) 0.40 -
Final (related to the year ended 30 September 2005) 0.20 -
Total dividend paid 0.60 -
Interim (related to the year ended 30 September 2006) 240 -
Final (related to the year ended 30 September 2005) 120 -
Total dividend paid 360 -
In accordance with FRS 21 dividends are recorded only when paid and are shown as a movement in equity rather than as
a charge in the profit and loss account. The Directors are proposing that a final dividend of 0.8p per Ordinary Share be
paid in respect of the year ended 30 September 2006. This will be accounted for in the 2006/07 financial year.
8 EARNINGS PER ORDINARY SHARE
FRS 14 basis
Basic earnings per share 5,988 59,899 10.00 2,074 59,899 3.46
Dilutive effect of share options - 254 (0.05) - - -
Diluted earnings per share 5,988 60,153 9.95 2,074 59,899 3.46
Effect of discontinued operations:
Discontinued basic e.p.s - 59,899 - 5,500 59,899 9.18
9 INTANGIBLE FIXED ASSETS
Group
Cost:
At 1 October 2005 7,559
Additions 231
At 30 September 2006 7,790
Amortisation:
At 1 October 2005 2,957
Charge for year 306
At 30 September 2006 3,263
Net book value:
At 30 September 2006 4,527
At 30 September 2005 4,602
Goodwill of £0.23m was acquired on the acquisition of PPS Electrical Limited. Further information is given in note 27.
7 DIVIDENDS
2006 2005
Weighted Weighted
average number average number
Earnings of shares EPS Earnings of shares EPS
£000 000 Pence £000 000 Pence
2006 2005
Pence/share Pence/share
£000 £000
Goodwill
£000
Annual Report & Accounts 2006
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NOTES TO THE ACCOUNTS
Group
Cost or valuation:
At 1 October 2005 11,682 789 822 4,748 18,041
Additions 123 - - 1,168 1,291
Transfer to current asset investment (11,532) - - - (11,532)
Disposals - - - (1,307) (1,307)
Acquisition of subsidiary - - - 120 120
At 30 September 2006 273 789 822 4,729 6,613
Depreciation:
At 1 October 2005 974 645 822 670 3,111
Charge for year 202 - - 1,321 1,523
Transfer to current asset investment (978) - - - (978)
Disposals - - - (915) (915)
Acquisition of subsidiary - - - 53 53
At 30 September 2006 198 645 822 1,129 2,794
Net book value:
At 30 September 2006 75 144 - 3,600 3,819
At 30 September 2005 10,708 144 - 4,078 14,930
At cost less depreciation 75 - - 3,600 3,675
At valuation - 144 - - 144
At 30 September 2006 75 144 - 3,600 3,819
Historical cost of revalued properties:
Cost - 715 781 - 1,496
Accumulated depreciation - (645) (781) - (1,426)
At 30 September 2006 - 70 - - 70
The valuations applied as noted above to the long leasehold land and buildings are based on Directors’ valuation.
The net book value of assets under finance leases at 30 September 2006 was £1,033,000 (2005: £1,747,000). During 
the year £410,000 (2005: £568,000) of depreciation was charged against assets held under finance leases.
The freehold property at 39 Cornhill was transferred to current asset investments following the Directors’ decision to sell
the property (Note 15).
Freehold Long leasehold Landfill Plant, vehicles Total
land and buildings land and buildings development & equipment
£000 £000 £000 £000 £000
10 TANGIBLE FIXED ASSETS
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Company
Cost or valuation:
At 1 October 2005 789 362 1,151
Additions - 57 57
Disposals - (152) (152)
At 30 September 2006 789 267 1,056
Depreciation:
At 1 October 2005 645 208 853
Charge for year - 24 24
Disposals - (30) (30)
At 30 September 2006 645 202 847
Net book value:
At 30 September 2006 144 65 209
At 30 September 2005 144 154 298
At cost less depreciation - 65 65
At valuation 144 - 144
At 30 September 2006 144 65 209
Historical cost of revalued properties:
Cost 715 - 715
Accumulated depreciation (645) - (645)
At 30 September 2006 70 - 70
The valuations applied as noted above to the long leasehold land and buildings are based on Directors’ valuation. 
The Company has no assets held under finance leases or hire purchase agreements.
Long leasehold Plant, vehicles Total
land and buildings & equipment
£000 £000 £000
38
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 38
10 TANGIBLE FIXED ASSETS (continued)
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NOTES TO THE ACCOUNTS
Company
Shares at cost:
At 1 October 2005 and 30 September 2006 152,552
Provisions:
At 1 October 2005 and 30 September 2006 68,880
Net book value:
At 30 September 2006 83,672
At 30 September 2005 83,672
Details of the principal subsidiary undertakings are included in note 30. The investment in subsidiaries is supported by their
net asset values and their discounted expected future cash flows.
12 INVESTMENTS IN JOINT VENTURE DEVELOPMENTS
The investments in joint venture developments consist of:
Group
At 1 October 2005 4,428 438 4,866
Exchange movements (258) (26) (284)
Loan advances - 149 149
Realisations (1,463) - (1,463)
At 30 September 2006 2,707 561 3,268
The Group’s share of assets and liabilities in these joint ventures comprises:
Stocks 2,894 5,649
Debtors 1,534 4,036
Cash 1 19
Gross assets 4,429 9,704
Less:
Creditors (1,449) (5,084)
Partner loans (273) (192)
Gross liabilities (1,722) (5,276)
Share of net assets 2,707 4,428
The Group’s share of the assets and liabilities in each joint venture varies. Stocks includes interest on non-Group specific
project finance of £1,475,000 (2005: £721,000). Details of the principal joint ventures are shown in note 30.
A letter of credit of £1,257,000 (2005: £1,335,000) remains outstanding at 30 September 2006. This letter of credit was
issued by Barclays Bank plc to M and T Bank (formerly known as Allfirst Bank) in the US in respect of the Russett Center
joint venture, which is guaranteed by the Company.
Subsidiary
undertakings
£000
Share of Loan Total
net assets advances
£000 £000 £000
11 INVESTMENTS
2006 2005
£000 £000
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Group
Developments and undeveloped land 18,395 9,297
Raw materials 278 276
18,673 9,573
14 DEBTORS
Due after more than one year:
Amounts recoverable on contracts 2,291 4,434 - -
Other debtors 2,055 1,317 - 580
4,346 5,751 - 580
Due within one year:
Trade debtors 28,240 34,320 585 673
Due from subsidiary undertakings - - 19,113 19,792
Amounts recoverable on contracts 35,891 28,448 - -
Other debtors 8,335 6,538 3,401 3,548
Corporation tax 35 191 - -
Deferred tax (note 6) 2,899 1,474 - 97
Prepayments and accrued income 1,693 1,865 888 841
77,093 72,836 23,987 24,951
Included within deferred tax is an amount of £1,200,000 which may not be recoverable within one year.
15 CURRENT ASSET INVESTMENTS
At 1 October 2005 6,089
Transfer from fixed assets 10,554
Disposals (16,643)
At 30 September 2006 -
The current asset investments comprised properties held for resale. The profit on disposal is disclosed in note 3.
2006 2005
£000 £000
40
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 40
13 STOCKS AND WORK IN PROGRESS
Group Company
2006 2005 2006 2005
£000 £000 £000 £000
Group and
Company
£000
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87379_RENEW_R&A_2006_TEXT PAGE 41
NOTES TO THE ACCOUNTS
Cash at bank 19,725 13,580 13,951 15,579
Cash in hand 10 10 - -
19,735 13,590 13,951 15,579
Cash at bank includes £(0.2)m (2005: £(0.7)m) in respect of the net position on a sterling bank deposit of £8.1m 
(2005: £8.1m) and a connected US$ loan of £8.3m (US $15.5m translated at the year end rate) (2005: £8.8m) used to
hedge US$ assets within the US subsidiary company and joint ventures.
17 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Bank loans and overdrafts - secured 10,093 3,600 - -
Obligations under finance leases 361 692 - -
Payments received on account 11,555 14,862 - -
Trade creditors 39,862 35,789 214 156
Corporation tax 56 160 3 -
Other taxation and social security 1,806 2,158 786 1,128
Due to subsidiary undertakings - - 97,963 104,163
Other creditors 5,496 9,409 4,418 6,841
Accruals and deferred income 52,326 48,350 2,089 1,353
121,555 115,020 105,473 113,641
Included in Creditors: amounts falling due within one year is £9,795,000 which relates to a short-term loan taken out to
fund a development. The loan is secured by a first charge on a development property which is included in stock and work
in progress at its cost to date of £11,875,000. The property on this development is being constructed by the Group under
normal contractual terms. A binding agreement to sell the building on completion of the construction has been signed with
an independent third party which has lodged an amount of £2.0m in escrow. In accordance with the Group’s normal
accounting policies, profit is being recognised on the construction element of the contract but profit on the development
aspect of the contract will only be recorded on sale.
The restatement to Creditors: amounts falling due within one year reflects accounting for dividends on a cash basis as
required by FRS 21.
Group (restated) Company (restated)
2006 2005 2006 2005
£000 £000 £000 £000
Group Company
2006 2005 2006 2005
£000 £000 £000 £000
16 CASH AT BANK AND IN HAND
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Secured bank loans and overdrafts falling due:
In one year or less - 3,600 - -
Between one and two years - 100 - -
Between two and five years - 600 - -
More than five years - 7,663 - -
- 11,963 - -
Less amount due within one year - (3,600) - -
- 8,363 - -
The Group has undrawn committed facilities of £7,000,000 (2005: £9,914,000) which will expire within one year.
19 OTHER CREDITORS
Obligations under finance leases 311 666 - -
Accruals and deferred income 1,510 3,392 - -
1,821 4,058 - -
Obligations under finance leases comprise £280,000 (2005: £469,000) due between one and two years and £31,000
(2005: £197,000) due between two and five years.
Group Company
2006 2005 2006 2005
£000 £000 £000 £000
Group Company
2006 2005 2006 2005
£000 £000 £000 £000
42
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 42
18 LONG-TERM DEBT
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NOTES TO THE ACCOUNTS
An explanation of the Group’s objectives, policies and strategies for the role of derivatives and other financial instruments in
managing the risks facing the Group can be found within the Directors’ report on page 15. The disclosures below do not
include short-term debtors and creditors as permitted by the exemption allowed in FRS 13.
Interest rate profile of financial assets and liabilities
2006
Assets
Sterling - - 24,317 24,317
Dollar - - 3,522 3,522
- 27,839 27,839
Liabilities
Sterling 3.0 (672) (9,795) (10,467)
Dollar - - (8,597) (8,597)
(672) (18,392) (19,064)
2005
Assets
Sterling - - 13,111 13,111
Dollar - - 479 479
- 13,590 13,590
Liabilities
Sterling 3.0 (1,358) (11,963) (13,321)
Dollar - -(8,813) (8,813)
(1,358) (20,776) (22,134)
The sterling interest bearing liabilities accrue interest at a rate which is linked to the lender’s base rate or LIBOR. Certain
US interest bearing liabilities accrue interest at a rate which is linked to the lender’s US Prime rate.
The maturity of the financial liabilities is disclosed in notes 17 to 19. The fixed rate liabilities have a weighted average
period of two years (2005: two years).
Currency exposures
The only exposure of the Group to currency risk (i.e. exposure to gains or losses on foreign exchange which would be
recognised in the profit and loss account) is in respect of the US dollar bank account which is maintained by the parent
company in the UK and the unhedged portion of an inter-company loan. At 30 September 2006 the un-hedged portion 
of the inter-company loan was $4,905,000 (2005: $4,905,000). At 30 September 2006 the balance on the US dollar bank
account was $1,000 (2005: $1,000).
All functional currencies of the Group operations are denominated in sterling, with the exception of the US operations
whose functional currency is the US dollar.
Hedges
In November 2000 the Group undertook a loan hedge of $25million with Barclays Bank plc against the net assets of 
Lovell America Inc. This was undertaken to minimise the foreign exchange movements of retranslating the net assets 
of Lovell America Inc. at prevailing rates. Exchange gains of £515,000 (2005: £179,000) were made during the year 
on foreign currency borrowings. This has been offset in reserves against exchange losses made on the investment in 
Lovell America Inc. The year end inter-company balance subject to hedging is US$15,537,000 (2005: $15,537,000). 
The US$ loan used for this arrangement is scheduled for repayment in November 2008.
Fair value of financial assets and liabilities
There are no material differences between fair value and the book value of the Group’s financial assets and liabilities.
20 DERIVATIVES AND OTHER FINANCIAL INSTRUMENTS
Fixed rate Financial assets/(liabilities)
weighted average Fixed Floating 
interest rate rate rate Total
% £000 £000 £000
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Group and Company
Authorised:
100,000,000 (2005: 100,000,000) Ordinary Shares of 10p each 10,000 10,000
Allotted, called up and fully paid:
59,898,927 (2005: 59,898,927) Ordinary Shares of 10p each 5,990 5,990
Share options
The Group operates a share option scheme, the Renew Holdings 2004 Executive Share Option Scheme. The scheme has
both an Approved and Unapproved element. The difference between the two elements is that the Approved scheme has
the advantage of certain Inland Revenue approved tax benefits.
Both elements have the same general terms and conditions. Options issued under the scheme must be held for three
years before they can vest and become exercisable. They must be exercised within 10 years from the date of grant.
Vesting of options is dependent on the achievement of certain performance criteria which are established by the
Remuneration Committee at the point of grant. In respect of the options granted during the financial year, 25% of the
options will vest if the Group’s earnings per share for the year ending 30 September 2008 exceeds 8p. For 100% vesting
to occur, the Group’s earnings per share for the year ending 30 September 2008 must be at least 12p. Any adjustment
relating to deferred taxation which affect the earnings per share calculation may be ignored by the Remuneration
Committee in determining whether or not performance criteria have been achieved. The scheme does not permit retesting
of performance conditions and if the performance criteria are not achieved then the options will lapse.
The number of options in issue and their exercise price is shown in the following table.
At 1 October 2005 - - - -
Granted 762 52.5 - -
At 30 September 2006 762 52.5 - -
2006 2005
£000 £000
44
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 44
21 SHARE CAPITAL
2006 2005
Number Exercise Price Number Exercise Price
‘000 p ‘000 p
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87379_RENEW_R&A_2006_TEXT PAGE 45
NOTES TO THE ACCOUNTS
Group
At 1 October 2005 5,893 73 3,896 (11,176)
Prior year adjustment re FRS 21 120
At 1 October 2005 as restated (11,056)
Transfer from profit and loss account for the year 5,988
Dividends paid (360)
Exchange differences (119)
Actuarial loss recognised in pension scheme (6,175)
Movement on deferred tax relating to the pension scheme 1,186
At 30 September 2006 5,893 73 3,896 (10,536)
There is no available analysis of goodwill written off against reserves in respect of existing subsidiaries that were acquired prior
to 1989 and therefore, in accordance with the guidance of FRS 10, the Directors are not able to state this figure. Goodwill
written off against reserves in respect of subsidiaries acquired after 1989 amounts to £nil (2005: nil).
Company
At 1 October 2005 as previously stated 5,893 73 3,896 1,556
Prior year adjustment re FRS 21 120
At 1 October 2005 as restated 1,676
Transfer from profit and loss account for the year (822)
Dividends paid (360)
At 30 September 2006 5,893 73 3,896 494
Share Capital Profit & Loss
premium Revaluation redemption Account 
£000 £000 £000 £000
22 RESERVES
Share Capital Profit & Loss
premium Revaluation redemption Account
£000 £000 £000 £000
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Group
Profit for the year 5,988 2,074
Dividends paid (360) -
5,628 2,074
Other recognised gains and losses for the year (5,108) (2,393)
Net movement on shareholders’ funds 520 (319)
At 1 October 2005 4,796 5,115
At 30 September 2006 5,316 4,796
24 CAPITAL AND LEASING COMMITMENTS
Group
Annual commitments under non-cancellable
operating leases expiring in:
Under one year 934 79 1,013 950
Two to five years 725 210 935 273
Five or more years 2,883 9 2,892 2,476
4,542 298 4,840 3,699
Company
Annual commitments under non-cancellable
operating leases expiring in:
Under one year 881 - 881 861
Two to five years 488 - 488 30
Five or more years 2,031 - 2,031 2,546
3,400 - 3,400 3,437
The Group and Company have no capital commitments at 30 September 2006 (2005: £nil).
2006 2005
£000 £000
Land & Other Total Total
buildings 2006 2005
£000 £000 £000 £000
Land & Other Total Total
buildings 2006 2005
£000 £000 £000 £000
46
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 46
23 RECONCILIATION OF MOVEMENTS IN GROUP SHAREHOLDERS’ FUNDS
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NOTES TO THE ACCOUNTS
The Company has guaranteed performance bonds in respect of certain contracts and leasing arrangements in the normal
course of business.
A letter of credit, guaranteed by the Company, has been issued by Barclays Bank plc to M and T Bank (see note 12).
26 DISPOSAL OF SUBSIDIARY UNDERTAKING
On 16 September 2005, the Group disposed of Bullock Construction Limited, for a cash consideration of £42,172,000.
The net profit on disposal was £22,300,000. The actual cash received by the Group as a result of the disposal was
£21,343,000 after the repayment of inter-company debts.
27 ACQUISITION OF SUBSIDIARY UNDERTAKING
On 2 June 2006, the Group acquired the whole of the issued share capital of PPS Engineering Limited (“PPS”), a company
registered in England & Wales. The acquisition was carried out by a subsidiary company within the Group.
From the date of acquisition, PPS has contributed sales of £0.7m and a profit before taxation of £0.05m to the
consolidated results.
The book value of the assets and liabilities of PPS at the date of acquisition were:
Fixed assets
Tangible assets 67
Current assets
Stocks and work in progress 31
Debtors: due within one year 581
Cash at bank and in hand 65
677
Creditors: amounts falling due in less than one year (307)
Net current assets 370
Total assets less current liabilities 437
Creditors: amounts falling due after more than one year
Other creditors (4)
Net assets 433
The consideration paid was £664,000 in cash. Goodwill of £231,000 was acquired on acquisition and will be reviewed for
impairment one year after the acquisition as permitted by FRS 10.
The trading result and cashflows of PPS are not considered by the Directors to be significant enough to warrant separate
disclosure in accordance with FRS 3.
25 CONTINGENT LIABILITIES
Book value
£000
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Defined benefit scheme
The defined benefit scheme was closed to new members in June 2000. On 1 August 2001, the Board decided that no further
benefits would accrue to existing members with more than five years expected service remaining. These members were
transferred to the defined contribution scheme but retained the benefits earned to date under the defined benefit scheme.
FRS 17 “Retirement Benefits”
The Directors have adopted the accounting required by FRS 17 with effect from 1 October 2003. The Directors have
discussed the assumptions used in determining the actuarial valuations set out below with independent pensions advisors
and have determined that they are appropriate.
The following disclosures required by FRS 17 have been based on the most recent actuarial valuation as 
at 30 September 2006 carried out by Barnett Waddingham, Consulting Actuaries, using the following 
financial assumptions:
Rate of increase in salaries 4.00% 4.00% 4.00% 4.25%
LPI increases to pensions in payment 2.50% 2.50% 2.50% 2.50%
Discount rate 5.30% 5.20% 5.70% 5.50%
Inflation assumption 2.50% 2.50% 2.50% 2.75%
Increases in deferred pensions 2.50% 2.50% 2.50% 2.75%
The assets in the scheme and the expected rates of return were:
Equities - 7.95% - 7.85% 16,604 8.35%
Gilts + 2.5% fund 56,494 6.95% 57,212 6.85% - n/a
Bonds 52,058 5.30% 51,401 5.20% - 5.50%
Gilts  - 4.45% - 4.35% 84,501 4.85%
Cash 89 4.75% (79) 4.50% 1,383 4.75%
Total 108,641 108,534 102,488
48
28 PENSION COMMITMENTS
As at As at As at As at
30 September 30 September 30 September 30 September
2006 2005 2004 2003
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 48
Value as at Expected rate Value as at Expected rate Value as at Expected rate
30 September of return 30 September of return 30 September of return
2006 2005 2004
£000 £000 £000
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87379_RENEW_R&A_2006_TEXT PAGE 49
NOTES TO THE ACCOUNTS
The following amounts at 30 September were measured in accordance with the requirements of FRS 17.
Total market value of assets 108,641 108,534 102,488 109,968
Present value of scheme liabilities (112,596) (106,906) (105,840) (143,128)
(Deficit)/surplus in the scheme (3,955) 1,628 (3,352) (33,160)
Deferred tax 1,186 - 1,006 9,948
Net (deficit)/surplus (2,769) 1,628 (2,346) (23,212)
Balance sheet adjustments to reduce 
surplus to nil at 30 September 2005 - (1,628) - -
Net deficit (2,769) - (2,346) (23,212)
All of the movements in the deferred tax amount related to the pension scheme deficit are shown as a movement through
the statement of total recognised gains and losses. 
FRS 17 was adopted with effect from 1 October 2003. The two columns in the following tables identify the actual amounts
included in the 2006 accounts and the 2005 comparatives.
Amounts charged to operating profit:
Current service cost (excluding employee contributions) (68) (98)
Reduction in deficit as a result of settlements - 3,650
Payments made to pensioners to effect the settlements - (1,111)
(68) 2,441
Amount credited/(charged) to other financial income:
Expected return on assets 6,452 5,431
Interest on scheme liabilities (5,410) (5,871)
1,042 (440)
Amounts recognised in the statement of total recognised gains and losses:
Actual less expected return on assets (1,786) 6,623
Experience (losses)/gains on liabilities (72) 647
Effect of change in assumptions on liabilities (5,945) (6,858)
Actuarial (loss)/gain (7,803) 412
Adjustment for amount charged in previous year 1,628 (1,628)
(6,175) (1,216)
Movement in the deficit during the year:
Deficit brought forward - (3,353)
Current service cost (excluding employee contributions) (68) (98)
Cash contribution (excluding employee contributions) 1,246 1,457
Settlements - 3,650
Other financial credits/(charges) 1,042 (440)
Actuarial (loss)/gain (7,803) 412
Net (deficit)/surplus (5,583) 1,628
Adjustment for pension asset not recognised in previous year 1,628 (1,628)
(Deficit) carried forward (3,955) -
As at As at As at As at
30 September 30 September 30 September 30 September
2006 2005 2004 2003
£000 £000 £000 £000
At 30 September At 30 September
2006 2005
£000 £000
28 PENSION COMMITMENTS (continued)
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Difference between the expected and £(1,786,000) £6,623,000 £426,000 £(338,000) £4,532,000
actual return on scheme assets
As a percentage of the assets at the end of the year (1.64)% 6.10% 0.42% (0.23)% 4.00%
Experience (losses)/gains on scheme liabilities £(72,000) £647,000 £1,176,000 £336,000 £427,000
As a percentage of the liabilities at the end of the year 0.00% 0.61% 1.11% 0.23% 0.35%
Total amount recognised in the statement £(7,803,000) £412,000 £11,294,000 £(25,340,000) £(3,224,000)
of total recognised gains and losses
As a percentage of the liabilities at the end of the year (6.93)% 0.39% 10.70% (17.70)% (2.66)%
The scheme has been in operation for many years and, after taking advice from the Group’s pensions advisors, the
Directors have determined that it is not possible to allocate the assets and liabilities of the scheme between the various
Group companies. As permitted by FRS 17, the Group has taken advantage of the multi-employer exemption and the
(deficit)/surplus of the scheme is accounted for as an unallocated consolidation adjustment.
Money purchase scheme
The assets of the money purchase scheme are held in separate trustee-administered funds. The Group made
contributions of £1,139,000 (2005: £1,246,000) into the money purchase scheme during the year. There was also 
£68,000 (2005: £100,000) of accruals relating to the scheme.
29 CASH FLOW NOTES
Operating profit/(loss) 3,473 (20,009)
Amortisation of subsidiary goodwill 306 303
Depreciation 1,523 2,657
Profit on sale of fixed assets - (78)
Impairment of fixed assets - 450
Impairment in current asset investments - 1,299
(Increase) in stocks and work in progress (9,551) (932)
(Increase)/decrease in operating debtors and prepayments (866) 7,705
Decrease in current asset investments 16,643 -
(Decrease) in creditors and accruals (1,152) (12,952)
Net movement on pension deficit included within operating profit (note 28) 68 (3,552)
Cash contribution to defined benefit scheme (1,246) (1,457)
Profit on sale of shared equity loans - (412)
Realisation of joint venture assets 1,463 1,640
Net cash inflow/(outflow) from operating activities 10,661 (25,338)
2006 2005 2004 2003 2002
2006 2005
£000 £000
50
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 50
28 PENSION COMMITMENTS (continued)
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NOTES TO THE ACCOUNTS
Analysis of net funds
Cash 13,590 5,889 256 19,735
Debt due after one year (8,363) 8,363 - -
Debt due within one year (3,600) (6,279) (214) (10,093)
Finance leases due after one year (666) 355 - (311)
Finance leases due within one year (692) 331 - (361)
(13,321) 2,770 (214) (10,765)
Net funds 269 8,659 42 8,970
The non-cash movement on cash relates to an unrealised foreign exchange gain on translation of the opening 
US balance sheet.
30 PRINCIPAL SUBSIDIARY UNDERTAKINGS AND JOINT VENTURES
The Company acts as the holding company of the Group. The principal activity of the Group during the year was
construction and construction related activities.
The principal subsidiary undertakings and joint ventures are shown below. 
Subsidiary undertakings
YJL Ltd Owned by Renew Holdings plc England and Wales 100%
Allenbuild Ltd Owned by subsidiary England and Wales 100%
Britannia Construction Ltd Owned by subsidiary England and Wales 100%
Walter Lilly & Co Ltd Owned by subsidiary England and Wales 100%
YJL London Ltd Owned by subsidiary England and Wales 100%
YJL Infrastructure Ltd Owned by subsidiary England and Wales 100%
VHE Construction Plc Owned by subsidiary England and Wales 100%
Shepley Engineers Ltd Owned by subsidiary England and Wales 100%
Lovell America Inc Owned by subsidiary USA 100%
Joint ventures % Interest
Russett Center Limited Partnership USA 50%
100 Investment Limited Partnership (Center 9500) USA 67%
The joint venture entities are held by Lovell America Inc.
At 1 October Non-cash At 30 September
2005 Cash flow movements 2006
£000 £000 £000 £000
Incorporation & Proportion of
principal place Ordinary Shares
of business held by the Company
29 CASH FLOW NOTES (continued)
87379_Renew_R&A_2006_Text.qxp  8/12/06  17:07  Page 51 SHAREHOLDER INFORMATION
Annual General Meeting 24 January 2007
Results Announcement of interim results - May 2007
Preliminary announcement of full year results - November 2007
Electronic Communications
Following shareholder approval to amend the Company’s Articles of Association at the AGM in March 2006, the Company
may deliver shareholder information, including Annual and Interim Reports and Notices of General Meetings, in an
electronic format to shareholders.
If you would like to receive shareholder information in electronic format, please register your request on the Company’s
Registrars’ electronic database at www.capitaregistrars.com You will initially need your unique “investor code”, which you
will find at the top of your share certificate. There is no charge for this service. If you wish to subsequently change your
mind, you may do so by contacting the Company’s Registrars by post or through their website.
If you elect to receive shareholder information electronically, please note that it is the shareholder’s responsibility to notify
the Registrars of any change to their name, address, e-mail address or other contact details. Shareholders should also
note that, with electronic communications, the Company’s obligations will be satisfied when it transmits the notification 
of availability of information or such other document as may be involved to the electronic address that it has on file. The
Company cannot be held responsible for any failure in transmission beyond its control any more than it can for postal
failure. In the event of the Company becoming aware that an electronic notification is not successfully transmitted, a further
two attempts will be made. In the event that the transmission is still unsuccessful a hard copy of the notification 
will be mailed to the shareholder. In the event that specific software is required to access information placed on the
Company’s website it will be available via the website without charge. Before electing for electronic communications
shareholders should ensure that they have the appropriate equipment and computer capabilities sufficient for the purpose.
The Company takes all reasonable precautions to ensure no viruses are present in any communication it sends out but
cannot accept responsibility for loss or damage arising from the opening or use of any e-mail or attachments from the
Company and recommends that shareholders subject all messages to virus checking procedures prior to use. Any
electronic communication received by the Company that is found to contain any virus will not be accepted.
Shareholders wishing to receive shareholder information in the conventional printed form will continue to do so and 
need take no further action.
Should you have any further questions on this please contact the Company’s Registrars, Capita Registrars, 
on 0870 162 3131.
52
Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 52
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87379_RENEW_R&A_2006_TEXT PAGE 53
DIRECTORS & ADVISORS
Directors Company Secretary C Wright LLB FCIS
R Harrison (Non-executive Chairman) 
B May (Chief Executive Officer) Company Number 650447
J Samuel FCA (Group Finance Director) 
J Bishop FCA (Independent non-executive) Registered Address 39 Cornhill
London
EC3V 3NU
Registrars Auditors Website address www.renewholdings.com
Capita Registrars Plc RSM Robson Rhodes LLP
Northern House City Centre Tower
Woodsome Park Birmingham 
Fenay Bridge B5 4UU
Huddersfield
HD8 0LA
Nominated Advisor and Broker
Brewin Dolphin Securities Ltd
34 Lisbon Street
Leeds
LS1 4LX
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Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 54
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the forty-seventh Annual General Meeting of the Company will be held at the offices of Brewin
Dolphin Securities Limited, 12 Smithfield Street, London EC1A 9BD on 24 January 2007 at 11.00 am.
The meeting will then consider the following business.
ORDINARY BUSINESS
To consider and, if thought fit, to pass the following ordinary resolutions:
1. To receive and adopt the accounts for the year to 30 September 2006 and the Reports of the Directors and Auditors
thereon.
(Resolution 1)
2. To declare a final dividend of 0.8 pence per share.
(Resolution 2)
3. To re-elect the following Director who retires in accordance with the Company’s Articles of Association:
Brian May. (Resolution 3)
4. To re-elect the following Director as a Director of the Company having been appointed since the last AGM:
John Samuel. (Resolution 4)
5. To re-elect the following Director as a Director of the Company having been appointed since the last AGM:
John Bishop. (Resolution 5)
6. To approve the Remuneration Report for the year ended 30 September 2006.
(Resolution 6)
7. To re-appoint RSM Robson Rhodes LLP as Auditors of the Company and to authorise the Directors to 
determine their remuneration.
(Resolution 7)
SPECIAL BUSINESS
To consider and, if thought fit, to pass resolution 8, which shall be proposed as a special resolution:
8. That the power conferred upon the Directors by regulation 5.3 of the Company’s Articles of Association to allot equity
securities (as defined in Section 94(2) of the Companies Act 1985) wholly for cash free from the pre-emption provisions
in section 89 of the Companies Act 1985 be renewed for the period ending on the date of the Annual General Meeting
in 2008 or on 24 April 2008, whichever is the earlier, and for such period the “Section 89 Amount” referred to in
regulation 5 of the Company’s Articles of Association shall be £299,495.
(Resolution 8)
28 November 2006 By Order of the Board
Registered Office C J WRIGHT LLB FCIS
39 Cornhill Company Secretary
London
EC3V 3NU
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NOTICE OF ANNUAL GENERAL MEETING
Notes
1. Holders of Ordinary Shares are entitled to attend and vote at this meeting. A shareholder entitled to attend and vote
may appoint a proxy, who need not be a shareholder of the Company, to attend (and on a poll to vote) instead of him
or her.
2. Proxy forms and the powers of attorney or other authority, if any, under which they are signed need to be deposited at
the office of the Company’s Registrars, Capita Registrars, Proxy Department, PO Box 25, Beckenham, Kent, BR3 4BR,
not later than 48 hours before the time of the meeting. Completion of a form of proxy will not preclude a shareholder
from attending and voting in person at the meeting.
3. Pursuant to regulation 41 of the Uncertificated Securities Regulations 2001, members will be entitled to attend and vote
at the meeting if they are registered in the Company’s register of members 48 hours before the time appointed for the
meeting or any adjournment thereof.
4. Resolution 8: By resolution 8 your Directors are seeking renewal of the power to allot shares for cash for the purposes
of a rights issue or, otherwise than in connection with a rights issue, limited to the issue of shares up to an aggregate
nominal value of £299,495 being 5% of the issued Ordinary Share Capital at the date of this Notice. If given, this power
will expire at the Company’s AGM in 2008 or on 24 April 2008, whichever is earlier.
Location of AGM
Underground
Farringdon and Barbican are both Circle, Metropolitan 
and Hammersmith & City Lines. Chancery Lane and 
St Paul’s are on the Central line.
Train
The nearest stations are City Thameslink and Farringdon.
Bus
Services 8, 25 & 521 stop on Holborn Viaduct.
Services 8, 25, 56, 242 & 521 all stop on Newgate Street.
For further information about public transport in London 
visit the Transport for London website at www.tfl.gov.uk 
or phone London Travel Information on 020 7222 1234.
Car Parking
Car parks are located on the map opposite.
12 Smithfield Street, London EC1A 9BD
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Annual Report & Accounts 2006
87379_RENEW_R&A_2006_TEXT PAGE 56
GROUP BUSINESSES
VHE
Phoenix House
Hawthorn Park
Coal Road
Seacroft
Leeds
LS14 1PQ
Tel: 0113 273 9200
Shepley Engineers
Robinson House
Westlakes Science Park
Moor Row
Cumbria 
CA24 3HY
Tel: 01946 599 022
Allenbuild
Jubilee House
Waterside Drive
Wigan
WN3 5AZ
Tel: 01942 246 265
Unecol House
819 London Road
North Cheam
Surrey
SM3 9BN
Tel: 020 8335 4800
Phoenix House
Hawthorn Park
Coal Road
Seacroft
Leeds
LS14 1PQ
Tel: 0113 237 5600
Stoneygate Road
Spondon
Derby
DE21 7RY
Tel: 01332 680 400
Walter Lilly
Waddon House
283 Stafford Road
Croydon
Surrey
CR0 4NN
Tel: 020 8730 6200
Britannia Construction
Britannia House
Staverton Technology Park
Cheltenham
Gloucestershire
GL51 6TQ
Tel: 01452 859 880
YJL London
18 Mansell Street
London
E1 8AA
Tel: 020 7977 0050
YJL Infrastructure
39 Cornhill
London
EC3V 3NU
Tel: 020 7522 3220
87379_Renew_R&A_2006_Text.qxp  8/12/06  17:07  Page 56 Produced by Salient Communications. Tel: 01635 861112.
Annual Report & Accounts 2006
highlights 01
chairman’s statement 02
chief executive’s review 03
review of operations 05
financial review 13
directors’ report 14
directors’ remuneration report 18
corporate governance 21
statement of directors’ responsibilities 23
independent auditors’ report 24
group profit & loss account 25
group statement of total recognised gains & losses 25
balance sheets 26
group cash flow statement 27
notes to the accounts 28
shareholder information 52
directors & advisors 53
notice of annual general meeting 54
group businesses 56
87379_RENEW_R&A_2006_COVER PAGE IBC 87379_RENEW_R&A_2006_COVER PAGE IFC
87379_Renew_R&A_2006_Cover.qxp  8/12/06  19:38  Page 2 39 Cornhill, London EC3V 3NU
tel: 020 7522 3200  fax: 020 7522 3213
web: www.renewholdings.com
delivering specialist
construction services
ANNUAL REPORT & ACCOUNTS  | 2006
renew holdings plc ANNUAL REPORT & ACCOUNTS 2006
87379_RENEW_R&A_2006_COVER PAGE FC 87379_RENEW_R&A_2006_COVER PAGE BC
delivering specialist
construction services
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