innovation
knowledge oege
construction i
relationships
annual report and
accounts 2008
ii direction
regeneration ege e a o
telford homes plc annual report and accounts 2008 www telfordhomes plc uk
telford ra  24608  1754  page 1 telford ra  24608  1754  page 2 “the name telford homes is taken from the engineer
thomas telford renowned for innovative ideas and
designs innovation in all areas of the business
including design construction partnerships and
marketing has played a major role in our success” 
innovation
telford ra  24608  1754  page 3 financial highlights 2008
revenue
£1604m
08 £1604m
07 £1044m
gross profit margin
209
08 209
07 224
operating margin
158
08 158
07 160
profit before tax
£177m
08 £177m
07 £135m
dividend per share
100p
08 100p
07 89p
earnings per share
333p
08 333p
07 294p
pretax return on
average equity
300
08 300
07 312
gearing
144
08 144
07 102
uncovered gearing
48
08 48
07 18
development pipeline
1842 properties
08 1842 properties
07 2221 properties
future revenue
already secured
£125m
08 £125m
07 £91m
telford ra  24608  1754  page 4 contents
business  financial review
financial highlights 03
chairman’s statement 07
chief executive’s review 09
financial review 17
operating review
area of operation 27
operational structure 29
key risks and uncertainties 31
corporate responsibility
health and safety 35
environment and sustainability 37
customer service 39
corporate governance
directors and advisors 43
policy on corporate governance 45
directors’ remuneration report 47
report of the directors 49
statement of directors’ responsibilities 52
auditors’ report 53
financial statements
income statement 57
balance sheet 58
statement of changes in equity 59
cash flow statement 60
statement of accounting policies 61
notes to the financial statements 65
development guide 88
annual report and accounts 2008     04
telford ra  24608  1754  page 5 telford ra  24608  1754  page 6 business  financial review
knowledge
“our knowledge of developing in east london is second to
none it remains a competitive advantage in working with
local councils the planning process affordable housing
partnerships acquiring land and selling homes”
telford ra  24608  1754  page 7 07     annual report and accounts 2008
chairman’s statement
“telford homes has
continued to make good
progress during the last
12 months and once
again i am reporting on
a record year in which
our financial targets
have been exceeded”
david holland 
chairman nonexecutive
the company’s strategy is to presell
properties as early as possible in many cases
before construction has commenced and a
number of successful sales launches have
contributed to this aim of reducing risk in the
business at 31st march 2008 unrecognised
revenue secured by contracts exchanged was
£125 million higher than ever before our
strategy has put us in a very strong position
in the face of a weakening market 
since last summer the company has been
more cautious when investing in new land
given the restricted availability and higher
costs of mortgage finance for homebuyers
and the impact this had on consumer
confidence this prudent approach will
continue funds have been retained for
investment in our partnerships with housing
transfer organisations but other land
purchases will be restricted to those where
the initial cash outflow is limited or cash
inflows from the development are secured 
we expect trading conditions to improve
when restrictions ease in the mortgage
market although it is not clear when this will
occur there remains a need to increase the
supply of new homes over the next few years
and this together with ongoing growth and
regeneration in east london underpins the
future success of telford homes 
david holland
chairman nonexecutive
27th may 2008
telford ra  24608  1754  page 8 annual report and accounts 2008     08
business  financial review
computer 
generated image of 
greenwich creekside se8
telford ra  24608  1754  page 9 chief executive’s review
“an excellent performance
in the first six months of
the year continued into
the second half despite
increasingly difficult market
conditions revenue has
grown by 54 to £1604
million and profit before tax
is up 31 to £177 million”
andrew wiseman
chief executive
this has been achieved as a result of the
strength of the telford homes brand
incorporating realistic pricing and consistent
delivery together with strong marketing
concepts which have allowed the company to
continue selling homes to the investor market
at an early stage in the development process 
property sales and affordable housing
contracts were exchanged on 523 open
market private homes 502 affordable
homes and ten commercial units making
a total of 1035 properties in the year
included within this number are 230 homes
being constructed under joint ventures
where we recognise half of the revenue
and profit from the development 
where the market allows we maintain
our policy of derisking the business by
contracting sales before much of the
development work on each site has taken
place this secures future cash flows and has
led to extended bank finance on a number
of developments where the volume of sales
offsets the risk of increased gearing in total
we had 2051 properties under construction at
31st march 2008 of which 73 were secured
by contracts exchanged 
the number of open market private homes
sold has increased by 9 this year with
the average selling price of those homes
increasing to £264000 from £258000
successful sales launches during the year
include the sale of all 161 open market
homes at merchants’ quarter on the british
estate e3 stadthaus n1 where all 19 open
market homes were sold in november 2007
vellum in walthamstow where contracts
have been exchanged on 24 of 66 open
market homes and kinetica e8 where 25 of
41 have been secured vellum and kinetica
were launched in the first few months of
2008 and reservations are still being taken
at these developments handovers of the
completed homes will take place in 2010
by which time our investors anticipate that
the market will have recovered
in contrast expected handover dates for the first
and second phases at queen mary’s gate 
in south woodford are all during 2008 
this development has been the company’s
09     annual report and accounts 2008
telford ra  24608  1754  page 10 business  financial review
annual report and accounts 2008     10
queen mary’s gate
south woodford e18
telford ra  24608  1754  page 11 icona stratford e15
telford ra  24608  1754  page 12 business  financial review
most significant sales outlet during the year
with properties largely for the owneroccupier
market the first phase is 93 sold with 172
out of 184 open market homes secured and
over 150 legally completed and occupied
the second phase is due to be completed
in november 2008 and contracts have been
exchanged on 18 of 93 open market
homes with a further one reserved 
whilst properties for the owneroccupier
market are less likely to sell at an early
stage the rate of sale has significantly
slowed at queen mary’s gate without
improvement in the current market
conditions we expect to be carrying a
number of completed homes for sale
on this development into 2009 and the
company is budgeting on this basis 
the number of affordable homes sold has
increased to 502 from 84 last year partly
reflecting the timing of some significant
contracts partnerships with affordable
housing providers remain integral to
our business and typically 35 of any
development is sold for affordable housing 
these partnerships are even more
significant in the current climate and
we will continue to be active in seeking
opportunities where an increased level
of affordable housing reduces the open
market risk in a development 
our development at papermill place in
walthamstow incorporates 175 homes being
constructed for east thames housing group
for £193 million as well as 66 open market
homes being marketed as vellum this mix of
homes improves the return on equity from
the development and secures cash inflows
over the course of construction in return for
a lower anticipated margin in total at 
31st march 2008 amounts due under
affordable housing contracts over the next
few years were in excess of £60 million 
completions
consumer confidence in the national
housing market has been hit in recent
months by the reduced availability and
higher cost of mortgage finance
restrictions on mortgage finance make
the process of legally completing finished
properties more protracted 
telford homes is communicating with
each purchaser to ensure their financial
arrangements have been instigated at an
early enough stage to meet our completion
dates in addition we have been in dialogue
with some of the major lenders and valuers
to maximise confidence through
transparency of information the 
telford homes approach to sales is based 
on net prices agreed at the point of sale 
with no undisclosed discounts or incentives
distorting true valuations 
in the last six months we have legally
completed more than 300 open market
homes at icona in stratford and 
queen mary’s gate with a quarter of these
in the past eight weeks although some have
taken slightly longer than usual to complete
there have only been a few serious issues on
two occasions we rescinded contracts with
the buyer and retained the 10 deposit one
of these properties was immediately resold
and completed the other was rescinded in
april 2008 and is expected to be resold at no
less than the original purchase price 
despite the problems in the mortgage
market our performance on completions
to date coupled with our early dialogue
with customers due to complete later in
2008 means that we remain confident that
the projected cash inflows from exchanged
properties will be realised 
annual report and accounts 2008     12
telford ra  24608  1754  page 13 site acquisitions
the company has reduced its investment
in the development pipeline over the last
few months in response to a climate of
continuing uncertainty in the housing
market and the economy protection of
cash has become our immediate priority
and we are therefore appraising sites
which have lower upfront net equity
requirements including joint ventures and
partnerships with housing associations 
our most recent acquisition is a parcel of
five sites in southwark in partnership with
family mosaic housing association which
are expected to deliver over 100 new
homes there are no initial land payments
from telford homes and the expected
proceeds will be shared with family mosaic
under the terms of the agreement three
of the sites are already under construction
and the other two are subject to receipt of
full planning permission 
planning
the planning process remains a significant
barrier to the efficient delivery of new homes
in london we retain a competitive advantage
through our knowledge of the local planning
environment in east london and this puts us
in a strong position during the year we have
had a number of successes including full
planning permission for the 371 homes at
greenwich creekside our joint venture with
the royal bank of scotland and for 360
homes in bethnal green road our joint
venture with genesis housing group 
increasing bureaucracy and the need to satisfy
several different bodies with competing views
have led to delays in the development of
some sites which are expected to be under
construction during 2008 two of our
developments await appeal decisions which if
allowed will mean work can commence later
this year overall the number of units in the
development pipeline that are subject to the
planning process has reduced to 25 of the
total pipeline from 42 last year 
chief executive’s review
13     annual report and accounts 2008
cosmopolitan apartments
enfield
telford ra  24608  1755  page 14 business  financial review
development pipeline and partnerships
our development pipeline being properties
that will produce profit in future years
excluding those built for joint venture
partners consists of 1388 properties with
planning permission and 454 subject to the
planning process this is a total of 1842
properties which are expected to provide
turnover in excess of £430 million and
gross profit of over £80 million 
although we have reduced our investment
in new land we have retained financial
resources to deploy in our partnerships
with eastend homes and poplar harca
these housing transfer organisations are
both significant land owners in east
london and have chosen telford homes
to be their partner on a number of large
regeneration schemes 
following the success of our partnership with
eastend homes on the british estate e3 we
have now submitted plans for the st george’s
estate e1 and we continue to progress master
plans for the regeneration of five other
estates the british estate has set the model
for this partnership with land payments made
by telford homes being reinvested into the
third party refurbishment of existing homes
on the estate in total the partnership with
eastend homes is expected to add in excess of
1000 properties to the development pipeline
and the partnership with poplar harca is
expected to add over 400 properties 
in further recognition of our contribution
to the supply of affordable housing we
were chosen as a prequalified partner
of the housing corporation during 2007
this enables the company to bid directly for
grant funding and gives us greater influence
in the provision of new affordable housing 
annual report and accounts 2008     14
computer
generated image of
bethnal green road e1
telford ra  24608  1755  page 15 chief executive’s review
15     annual report and accounts 2008
operating performance
the operational output of the business
continues to grow and we have over 3000
properties either in the planning process in
detailed design or under construction there
are now three operating divisions managing
delivery following the formation of strada
earlier this year to join alto and metro in
many ways it is business as usual in the
operational management of the development
pipeline and it will remain so if we continue
to be successful in selling our homes at an
early stage in the development process 
health and safety remains at the forefront
of our business and we have continued to
develop and monitor our policies and
procedures during the year 
people
staff numbers have risen in the last 12
months to manage increasing activity
we will maintain and expand this
infrastructure to deliver our properties
whilst we are able to secure the cash
inflows from their development every
employee contributes to the excellent
reputation of telford homes and i thank
each of them for their efforts this year in
producing another set of record results 
computer generated
image of stadthaus n1
telford ra  24608  1755  page 16 business  financial review
annual report and accounts 2008     16
computer generated
images of kinetica e8
current trading and outlook
the reduced availability of mortgage
finance is continuing to weaken confidence
in the national housing market which makes
it more difficult to secure individual sales
even in london traditionally the most
resilient region our developments with
completion dates 12 months or more into
the future continue to attract buyers’
interest confirming long term confidence
queen mary’s gate still with availability
and completing later in 2008 has seen a
significant slowdown in sales in the past
few months due to short term concerns 
we will time sales launches at greenwich
creekside and bethnal green road to get
the best results in light of prevailing market
conditions both of these developments are
due for completion in 2011 reflecting our
high percentage of presales at 31st march
2008 we have made only a handful of sales
since the end of the year with no new
launches and relatively little marketing
activity taking place during this period 
recent figures from the department for
communities and local government show
that the supply of new homes is not going
to meet current government targets in the
short term new housing starts for the three
months to march 2008 were 32100 against
an annual target of 240000 ongoing tighter
terms for mortgage finance will further
restrict new starts as developers will not
construct properties that cannot be sold
the imbalance between the supply of new
homes and the need for somewhere to live is
increasingly evident and the rental market in
east london is growing steadily as a result 
the company is in a strong position both
to withstand the current market and to
benefit once conditions begin to improve
our strategy in previous years of preselling 
is now paying off and as at 31st march 2008
revenue secured but not yet recognised was
£125 million up from £91 million at the
same time last year 
we are cautious in our approach to the new
financial year but the need for new housing
in east london together with an ongoing
programme of regeneration our brand’s
reputation and our beneficial partnerships
with affordable housing providers gives me
confidence that the medium to longer term
outlook for telford homes remains positive 
andrew wiseman
chief executive
27th may 2008
telford ra  24608  1755  page 17 financial review
“telford homes has produced
another year of record revenue
and profit during a period
of increasing uncertainty
in response to the change
in market conditions the
company is taking a prudent
approach to its deployment
of cash for land acquisition”
jonathan distefano 
financial director
the protection of cash balances and the
appropriate funding of the business must
be key priorities in the current climate 
operating results
revenue increased to £1604 million from
£1044 million last year an analysis of
properties sold in the year is given in the
chief executive’s review 
gross profit has increased to £336 million
with the margin falling to 209 from
224 last year this fall is partly due to a
number of developments where the cash
profile results in higher returns on equity
balanced during the site appraisal by a
reduced margin each new site is appraised
to achieve a gross margin of at least 20
unless high returns on equity can be
secured either through deferred land
payments or early revenue receipts 
queen mary’s gate in south woodford was
purchased for consideration of 35 of all
private sales proceeds achieved from the
development the total expected payments
now exceed £35 million with only £14
million paid up to 31st march 2008 resulting
in a high rate of return on equity the profit
margin on our share of sales proceeds is in
excess of 20 as this represents our risk in
the development however the reported
margin is 14 when taking the proceeds
being paid directly to the vendor into
account still in line with our original
expectations for the site the gross margin in
2008 excluding queen mary’s gate is 226
down from 235 last year 
the operational teams continue to monitor
and control development costs in a period
that has seen significant cost pressures
particularly for some raw materials cost
contingencies cover much of this inflation
and careful management will be required
going forward to minimise the impact on
margin in a period when increasing costs
will not be offset by increasing sales values 
17     annual report and accounts 2008
telford ra  24608  1755  page 18 business  financial review
annual report and accounts 2008     18
showhome interiors at
queen mary’s gate
south woodford e18
telford ra  24608  1755  page 19 some of these pressures are likely to be
alleviated in the current market but it
will take time for this to manifest itself in
subcontract tender prices our commercial
teams are focused on achieving cost savings
in the coming months total build costs in
the year to 31st march 2008 were 
£76 million up from £50 million last year 
the operating margin has fallen to 158
from 160 with overheads reducing as a
percentage of revenue to 51 from 64
last year overheads remain controlled given
the need to recruit adequately to manage
the increasing number of properties in
design and under construction 
interest
interest charged in the year was £81 million
up from £40 million last year in line with
our expectations this reflects a significant
increase in activity on site during the year
together with the impact of investing funds
from the 2006 share placing in new
development sites where bank finance
provides 70 of the cash requirement 
interest received in the year was 
£05 million down from £08 million last
year as a result of lower average cash
balances following the investment of the
placing funds pressure on finance costs has
been alleviated to some extent by the
recent reductions in the base rate the
majority of the company’s bank finance is
linked to the base rate with some exposure
to libor linked funding in one of our
jointly controlled entities 
all of our facilities with the royal bank
of scotland and barclays bank are at base
rate plus margins of 15 to 175
depending on whether each site has
planning permission the company has
recently negotiated a £33 million
development facility with the royal bank
of scotland for greenwich creekside at
base rate plus 15 and these rates are
still being achieved thanks to our strong
relationships and proven track record in
achieving sales
our revolving facility with allied irish bank
is renegotiated on an annual basis each
april and whilst the bank is borrowing at
libor they are moving away from any base 
financial review
19     annual report and accounts 2008
onestratford
stratford e15
telford ra  24608  1755  page 20 business  financial review
annual report and accounts 2008     20
icona stratford e15
rate linked funding in this context we have
negotiated base rate plus usual margins
plus an additional 05 while three month
libor remains more than 05 over base
rate essentially this caps the additional
libor liability at 05 whilst the current
differential is nearer to 09 
interest cover was 36 times in 2008 which
remains well within acceptable limits 
dividends
the board proposes a final dividend of 55
pence per ordinary share together with
the interim dividend of 45 pence paid in
january 2008 this will give a total dividend
for the year of 100 pence which is covered
33 times by earnings per share the total
dividend last year was 89 pence 
the final dividend is expected to be paid
on 18th july 2008 to shareholders on the
register on 27th june 2008 
the board’s dividend policy is to maintain the
level of cover at around 33 times in order to
achieve an appropriate mix between profits
returned to shareholders and those reinvested
in the business at all times the company
monitors expected cash flows to ensure that
this dividend can be accommodated within
current and future resources 
earnings per share
earnings per share increased to 333 pence
from 294 pence and the weighted average
number of shares in issue was 370 million
up from 328 million shares because the
shares issued in the october 2006 placing
had a full year weighting 
balance sheet
net assets have increased to £642 million
from £548 million and net assets per share
at 31st march 2008 were 171 pence up
from 148 pence last year 
the placing funds raised in 2006 have been
allocated to new land opportunities and we
have reserved some equity for investment
over the next two years in our partnerships
with housing transfer organisations some of
the sites purchased with the placing funds will
take time to flow into revenue as they have
only just received planning permission or are
still going through the planning process 
pretax return on equity in the year ended 31st
march 2008 was 300 falling from 312 last
year partly as a result of the weighting of the
additional equity raised in late 2006
telford ra  24608  1755  page 21 financial review
21     annual report and accounts 2008
queen mary’s gate south woodford e18
telford ra  24608  1755  page 22 business  financial review
finance
the company uses loan finance to acquire
development land and undertake site
construction and facilities are in place with
three banks secured by a debenture over
the assets of the company and by charges
over the development sites owned by the
company typically the debt to equity ratio
in these facilities is 7030 with extended
funding available on some sites where all
properties have been sold 
we maintain excellent relationships with
each of our banking partners and fully
involve them in our cash flow forecasting and
sensitivity analysis the detailed nature of our
reporting together with our existing rate of
presales and the nature and location of our
developments has reinforced confidence in
the company and is directly assisting the
negotiation of new facilities and the renewal
of existing facilities in a period of reduced
liquidity in the banking industry 
our revolving loan facility with allied irish
bank of £40 million is allocated to certain
development sites at 31st march 2008 we
had utilised £248 million of this facility
leaving an unutilised balance of 
£152 million the facility is next due for 
an annual review in april 2009 
in addition the company’s jointly controlled
entity bishopsgate apartments llp has a
credit facility with allied irish bank of 
£20 million in respect of the purchase of
development land in bethnal green road
interest is charged at libor plus 125 at
31st march 2008 bishopsgate apartments llp
had utilised £19 million of this facility and
telford homes has recorded its 50 share of
the loan in the balance sheet at 31st march
2008 this facility expires in january 2009 
and an increased development land and
construction facility is being negotiated
following the grant of planning
permission in march 2008 
the company has site specific loan
facilities with the royal bank of scotland
of £843 million at 31st march 2008 we
had utilised £516 million of these
facilities leaving an unutilised balance of
£327 million facilities are repayable on
completion of each development directly
from the sales proceeds received 
in addition the company’s jointly controlled
entity telford homes creekside limited
has a credit facility with the royal bank of
scotland of £513 million in respect of the
purchase of development land and
construction at greenwich creekside at
31st march 2008 telford homes creekside
limited had utilised £138 million of this
facility leaving an unutilised balance of
£375 million the company has recorded
its 50 share of the loan in its balance
sheet at 31st march 2008 this facility is
due for repayment in 2011 
the company has site specific loan facilities
with barclays bank of £126 million at 31st
march 2008 we had utilised £54 million of
these facilities leaving an unutilised balance
of £72 million these facilities are due for
repayment during 2010 
gearing at 31st march 2008 was 144
increased from 102 last year when this was
lowered by placing funds held on the balance
sheet gearing is down from 173 reported
for the interim results as we have reduced
investment in the development pipeline
we remain comfortable with our level of
gearing as we can balance the certainty of
future cash inflows against exposure to debt
our business model of selling properties at
an early stage of construction reduces the
risk of carrying debt as the sales revenue on
a given development secured by exchanging
contracts will be used to repay loans specific
to that development 
annual report and accounts 2008     22
telford ra  24608  1755  page 23 financial review
23     annual report and accounts 2008
internally we calculate ‘uncovered gearing’
which excludes debt matched by the value of
contracts exchanged on a given development
this is an important performance indicator in
the business and is monitored by all three
banks currently funding the company the
board has determined that levels of
uncovered gearing up to 100 are
acceptable uncovered gearing at 31st march
2008 was 48 up from 18 last year but
down from 56 at september 2007
the company had access to immediate
funding on presold sites of £9 million
at 31st march 2008 and had this been drawn
then uncovered gearing would have reduced
to 34 facilities are managed to minimise
the drawdown of funds where these are not
immediately required in the business in
order to control interest costs 
at 31st march 2008 the company had
unutilised overdraft facilities of £3 million
2007  £25 million 
cash flow
we maintain a detailed month by month cash
flow forecast as part of our management
information systems this extends five years
into the future and is subject to continual re
assessment and sensitivity analysis the cash
flow position is reviewed by the board and by
each of the company’s banking partners on a
monthly basis 
international financial
reporting standards
telford homes has adopted international
financial reporting standards ifrs for the
year ended 31st march 2008 there were no
significant changes in accounting required
as a result of the company adopting ifrs
future change in accounting policy
the international financial reporting
interpretations committee ifric has
recently concluded lengthy deliberations
on the accounting treatment for real estate
sales their proposed amendment to the
accounting required under ifrs will mean
that telford homes will have to account for
revenue and profit from open market private
sales on legal completion of each property
currently revenue and profit for all properties
is recognised from the point of exchange of
contracts and then on a percentage complete
basis the accounting for affordable homes
sold under construction contracts will remain
unchanged this proposal is expected to be
agreed in june 2008 and would be effective
for the year ended 31st march 2010 the
method of accounting will not change the
financial health or day to day operation of
the business but will have a significant impact
on reported revenue and profit in each year
and the company will assess this over the
next few months 
jonathan distefano
financial director 
27th may 2008
telford ra  24608  1755  page 24 estilo n1
telford ra  24608  1755  page 25 telford ra  24608  1755  page 26 operating review
construction
“telford homes has over 3000 properties going through the
planning process in detailed design or being developed
just over 2000 of these are under construction and
73 are already sold with contracts exchanged”
telford ra  24608  1755  page 27 area of operation
telford homes is all about east
london the business has been
built up in this area and ongoing
regeneration across several
boroughs means there are many
more opportunities to come in
the future across a wide area 
telford homes has developed in
nine east london boroughs in the
past and in 2008 is developing in
southwark for the first time
commencing design and construction
on five sites in partnership with
family mosaic housing association 
local knowledge has played a key
role in helping the company to
grow and it remains a competitive
advantage particularly in
relationships with councils and
affordable housing organisations
and in our understanding of the
local planning process
the 2012 olympics continues to be
a major boost to east london with
the olympic park being constructed
in stratford and with many other
events due to take place in the
local london boroughs this has
accelerated the programme of
regeneration that was already taking
place including further improving
transport links to the region
the regeneration of east london
will continue for many years to
come and while the opportunities
to utilise the company’s competitive
advantage remain telford homes
will continue to play a significant
role in this process
lesney
bethnal green road
stadthaus
27     annual report and accounts 2008
kinetica
telford ra  24608  1756  page 28 operating review
icona
onestratford
merchants’ quarter
greenwich creekside
annual report and accounts 2008     28
satellite map of east london showing a selection of telford homes’ developments
image courtesy of wwwgettyimagescom
telford ra  24608  1756  page 29 operational structure
29     annual report and accounts 2008
at 31st march 2008 telford homes had
over 3000 properties going through the
planning process in detailed design or
under construction
in order to effectively manage these
properties through the development
pipeline the company is now organised
into three operating divisions following
the formation of strada earlier this year
to join alto and metro 
this structure is necessary in order to focus
each operational team on excellent design
high standards of construction and delivery
on programme each division specialises in
certain sizes of development and styles of
construction alto are responsible for over
1700 of the properties in planning design
and construction across eight developments
metro are responsible for over 600 properties
across 18 developments and strada over 700
properties across four developments
on the 1st august 2007 mark parker and
john fitzgerald were appointed to the
board to jointly take on the roles and
responsibilities of group managing director
together they have responsibility on the
board for the management of the three
operating divisions mark parker is
responsible for metro and strada and john
fitzgerald is responsible for alto each
division has a management team responsible
for day to day operations and mark duffield
was appointed during the year to be the
managing director of metro to assist 
mark parker in managing two divisions 
sales and marketing land acquisition
partnerships customer service finance and
buying are regarded as core central services
that deliver economies of scale in a relatively
small geographic region by remaining
outside of the divisional structure
metro management team
left to right
david mahoney
mark duffield
trevor northcott
jeremy brett
telford ra  24608  1756  page 30 operating review
annual report and accounts 2008     30
strada management team
left to right
steve waite
mark parker
paul saunders
paul copsey
alto management team
left to right
james gaffney
john fitzgerald
chris dreher
barry hall
telford ra  24608  1756  page 31 key risks and uncertainties
31     annual report and accounts 2008
economic environment
demand for properties from both investors and owneroccupiers is dependent on confidence in both
the local housing market and the wider economy this confidence is heavily influenced by factors such
as interest rates the availability of mortgage finance rental incomes unemployment and consumer
costs for other goods and services all of these are outside of the company’s control
the company’s policy has been to sell early in the development process wherever possible to minimise the
risk in each site this policy has been very successful to date with 73 of properties under construction at
31st march 2008 secured by exchange of contracts in addition the sales and marketing team have detailed
knowledge of the local market and are able to formulate the best sales strategy for each development and
to work with purchasers and prospective purchasers to ensure that all stages of the process from reservation
to legal completion run smoothly
land acquisition
the company needs new land to maintain a development pipeline and enable the business to continue
to operate at a certain capacity this land needs to be sourced in appropriate locations and where optimum
planning consents can be obtained the appraisal process that determines the price paid for land is critical
in maintaining margins and return on equity at acceptable levels 
the land acquisition and partnerships teams are responsible for sourcing land and our strong relationships
with various land owners including local councils and affordable housing providers play a key role in our
ability to acquire new sites in particular our existing partnerships with housing transfer organisations are
expected to be a significant source of land in the next few years the appraisal process for new sites includes
due diligence by an experienced solicitor and authorisation of all prospective purchases at appropriate levels
health and safety
construction sites are dangerous places and there are many different health and safety risks to consider
the health and safety of everyone associated with telford homes both employees and subcontractors is
the first priority of the company
investment in training the promotion of health and safety to all employees and extensive policies
and procedures all contribute to a comprehensive approach to health and safety management with
the objective of minimising risk and providing a safe working environment 
planning process
the flow of properties through the development pipeline is dependent on achieving suitable planning
permission on sites purchased without planning or subject to planning the process is time consuming and
involves an increasing number of supporting reports and detailed consultations with many different bodies
delays in achieving suitable planning permissions affect the number of properties that can be brought to
market and impact on future timing of cash flows failure to achieve a suitable planning permission may
lead to cost write offs or reduced margins on individual developments
the company has extensive knowledge of local planning requirements excellent relationships with
planning authorities and takes care in the appointment of professional architects planning consultants
and engineers early consultations with the planning authorities are a key part of the land acquisition
process while this cannot remove planning risks it mitigates them as much as possible the company has
454 properties in the development pipeline going through the planning process reduced from 942 last year
telford ra  24608  1756  page 32 construction
the construction process is critical to the efficient and timely delivery of properties to purchasers which affects
both cash flow and customer satisfaction the quality of the construction work and finish in each property
affects the reputation of the company and can impact on repeat purchase and recommendation rates
standards of construction and control of the building process on site are of paramount importance to each
operating division careful planning is required to assess a development programme before construction
commences and this is monitored over the course of the building work the construction teams work very
closely with the customer service team and their interaction commences at an early stage in the development
the customer service team spend a substantial proportion of their time on site carrying out quality control
before a purchaser sees the property for the first time over 90 of surveyed customers who took ownership
of a telford homes property in 2007 would recommend the company to their friends and family
availability of materials and labour
the availability of materials and subcontracted labour for each site can affect both the construction
programme and the cost of construction build cost inflation will impact directly on the margin achieved
on each site where this is in excess of forecasts
planning of the construction programme and timely management of the tender process for each subcontracted
trade reduces the risk of delays in the construction programme due to availability of materials and labour the
tender process ensures that competitive rates are achieved on every trade telford homes works in partnership
with all of its subcontractors and makes timely payments to encourage an equal relationship that is beneficial
to all parties
political environment
changes in laws and regulations can have a direct impact on the efficient running of the company
and the costs incurred on each development changes in both local and national government can
have a direct bearing on the regulatory environment
the company works closely with specialist consultants to ensure that it is up to date with current
regulations and aware of any future changes so that operations can be planned accordingly 
cash requirements and bank finance
property development is a capital intensive business with significant initial outlays supported by bank finance
and lengthy time periods before the majority of the cash inflows on each project forecasting of cash flows is
critical to ensure the company is not operating above its financial capacity part of this process involves the
forecasting of bank funding required for each development and the availability of sufficient bank finance is
therefore also of critical importance
the company maintains a detailed cash flow forecast as part of its management information systems this
extends five years into the future and is subject to continual reassessment and sensitivity analysis the cash
flow position is reviewed by the board and by each of the company’s banking partners on a monthly basis
the company has excellent relationships with the three banks currently funding the business and has sufficient
facilities available to ensure the continuing operation of the business on all sites currently under construction
operating review
annual report and accounts 2008     32
telford ra  24608  1756  page 33 telford ra  24608  1756  page 34 corporate responsibility
regeneration
“through the development of top quality and well connected
housing schemes telford homes is a significant contributor to the
regeneration of rundown housing estates and obsolete industrial
land to provide inclusive balanced and sustainable communities”
telford ra  24608  1756  page 35 “my goal for this year is
to achieve our occupational
health and safety management
system ohsas 18001
accreditation which will be a
significant step in demonstrating
our ongoing commitment to
health and safety”
steve nicoll 
group health  safety manager
the company continues to regard the
promotion of health and safety as a critical
objective of all employees at every level
every employee is issued with health and
safety instructions that endeavour to identify
all the risks and dangers that are likely to be
encountered in the course of their work and
set out precautionary measures 
as the company continues to grow
recruitment of key staff remains crucial in
sustaining the company ethos regarding the
high health and safety standards expected
from our employees 
we continue to invest in the training
and development of our people with the
introduction of our ‘health and safety core’
training programme this training programme
ensures that the same level of training is
delivered across the company including those
joining the business the ‘health and safety
core’ training programme is also used in the
selection process for new employees 
our accident frequency rate remains below
industry average against a substantial increase
in growth having completed 1656000 man
hours in the year ended 31st march 2008 an
increase of over 700000 on the previous year 
we continue to explore new and different
ways of working to improve our efficiency
and reduce our exposure to risk a good
example of this is our stadthaus development
in murray grove n1 where the tallest timber
structure in europe is being constructed
traditionally the height of our developments
has precluded this type of structure but recent
developments within the industry have made
it possible the modular construction process
not only increases the efficiency of the build
but crucially dramatically reduces the
exposure to risk for those involved in
the construction process
our ‘executive safety committee’ and
‘operational safety forum’ continue to
meet regularly and have been instrumental
in developing a significant change to
company procedures as the business
grows and develops 
it was recognised that the company
approach to health and safety would be
developed through the ‘safety forum’
health and safety
35     annual report and accounts 2008
telford ra  24608  1756  page 36 primarily with the ‘executive safety
committee’ ruling on issues that could not
be agreed by the ‘safety forum’ to date the
‘executive committee’ has not been called to
make a ruling signifying that the intention
of encouraging an inclusive culture
throughout the business and delivering
integrated solutions has been successful
our ‘supplychain’ procedure continues
to be developed with the majority of our
suppliers now vetted by our health and
safety department a procedure is in place
prohibiting the placing of orders with suppliers
that have not been successfully audited 
john fitzgerald mark parker and 
mark duffield are responsible for health
and safety in each of the operating divisions
with the assistance of steve nicoll 
john fitzgerald is the board member with
overall responsibility for health and safety
“one year on from joining the business
i am pleased to say that the health and safety
culture within the company continues to
develop positively there have been some
ongoing improvements starting with some
of the simplest site administration issues to
the launch of our revised ‘company health
and safety procedures’ i believe that the
commitment and integrity of our site teams
is second to none and i look forward to
another year of support as we continue
to develop and monitor our approach to
health and safety within the business”
steve nicoll
group health  safety manager
corporate responsibility
annual report and accounts 2008     36
greenwich creekside se8
under construction
telford ra  24608  1756  page 37 papermill place walthamstow incorporating vellum
what we are doing
• a biomass boiler expected to provide 20 of the energy for heating
and hot water
• onsite remediation of contaminated soil minimises the transport of
material for offsite treatment or disposal
• constructing a sustainable storm water drainage and storage system
• fully integrated recycling facilities within the refuse collection areas
• a total of 114 cycle spaces on the development
• all new timber used in the construction process is from managed
sustainable sources
• ecohomes rating of ‘very good’ will be achieved in part by providing
water flow restrictors on showers and taps and dual wc flushing 
environment and sustainability
telford homes is committed to designing
and constructing developments that both
minimise ecological impact and improve
energy efficiency the company has an
environmental policy and we ensure that this
is communicated throughout our operations
our approach means we reuse and recycle
and adopt renewable materials wherever
viable and continually look for new ways
to meet and exceed environmental
expectations in all of our activities
our most recent schemes aim for a
minimum of 10 of energy to come from
sustainable sources this includes biomass
boilers fuelled by wood pellets to provide
heat and hot water at sobow e3 
onestratford e15 bethnal green road e1
and greenwich creekside se8 the harnessing
of natural energy takes place in the form of
solar panels at icona e15 four helical wind
turbines at kinetica e8 and air source heat
pumps at decorum e10 a number of ‘green’
and ‘brown’ roofs across our developments
protect the natural habitat of birds such as
the black redstart
these are just a few of the things that
telford homes is doing and all of these
initiatives are having a positive impact now
and will continue to do so in the future in
order to continue to build considerately we
will continue to research sustainable energy
solutions to ensure the best technologies
are used and that we are positively
contributing towards a greener future
37     annual report and accounts 2008
casestudy  papermill place
telford ra  24608  1756  page 38 corporate responsibility
in addition to our commitment to the
environment we consider our social
responsibility in a wider sense to be of vital
importance in the areas in which we operate
the regeneration of east london is an
ongoing project in which we are playing
a major role this process is increasing the
quality of life for local people both by
improving neighbourhoods and through the
provision of new but affordable housing with
our housing association partners we have
excellent relationships with local councils and
housing associations and we are extremely
supportive of the need to provide affordable
housing for shared ownership and for rent
stadthaus murray grove n1
what we are doing
• development utilises a cross laminate timber panelling system 
built on a reinforced concrete podium
• saves 306150 kg of carbon in the construction process compared
to a concrete frame
• communal areas will be powered by rooftop photovoltaic panels
• high efficiency condensing gas ‘combi’ boilers in each property
• provision of facilities for recycling
• environmentally friendly insulation materials used in construction
• provision of ‘home user guides’ to ensure homeowners are aware 
of all environmental features in the property and make the best 
use of them
annual report and accounts 2008     38
casestudy  stadthaus
left
the black redstart 
a bird who’s natural
habitat is recreated
on a brown roof
right
solar power panel
system at icona e15
telford ra  24608  1756  page 39 “the telford homes brand is
about consistent delivery of
highquality valueformoney
new homes backed up by 
our dedicated customer
service team providing 
first class product finish 
and service excellence in
equal measure”
anthony atkinson 
customer service director
the key points of our approach are
• communication build progress completion
dates and runningin advice
• thorough quality control inspections by
our customer service managers in the
final weeks of construction
• the same team ‘snagging’ every unit
across all developments to achieve
consistently high standards
• defect elimination by telford homes
– not the customer
• precompletion inspections with customers
to demonstrate finished quality
• thorough demonstration on handover
for troublefree ownership
• inductions for new tenants showing
how to use the home prevents most
runningin problems 
• for the first two years a 247 365 days
a year free emergency service is provided
for the times when our offices are closed
and help is required
• listening to feedback for
future improvements
customer service
39     annual report and accounts 2008
telford ra  24608  1756  page 40 each development has a dedicated
customer service manager who is
responsible for quality control purchaser
liaison pre and post completion handover
and home demonstrations this dedicated
team is both approachable and friendly and
provides a professional service at all times
the team spend over 80 of their time on
site undertaking checks throughout each
and every apartment during construction
to ensure consistently high standards of
product finish and function
for the first two years we also provide
a 247 365 days a year free emergency
service to ensure there is always someone
to help deal with any urgent problems that
may arise out of hours telford homes have
a dedicated inhouse maintenance team
that are quick to respond and deal with
any issues as and when they are reported
all calls and scheduled appointments are
directed through a highly efficient head
office based service team
overall telford homes product and service
excellence has brought us a high level of
repeat purchase and recommendation from
satisfied customers over 90 of surveyed
customers who took ownership of a telford
homes property in 2007 would recommend
the company to their friends and family
corporate responsibility
annual report and accounts 2008     40
quality control 40
post completion defect
management 7
managing and letting
agent liaison 5
handovers 15
precompletion
inspections 
demonstrations 30
other 3
customer service managers’
involvement with new developments
telford ra  24608  1757  page 41 telford ra  24608  1757  page 42 corporate governance
relationships
“our excellent relationships with housing associations have
led to a number of long term partnerships which will add
to our development pipeline and provide a foundation
for the future success of telford homes”
telford ra  24608  1757  page 43 directors and advisors
david holland nonexecutive chairman 67
david holland has over 40 years experience in the development and house building sector having
joined george wimpey plc in 1966 on his retirement he held the position of group managing director
with responsibility for worldwide housing and land development in 1997 david held the 
annual position of president of the house builders federation david is currently chairman of 
orchid developments group ltd and nonexecutive director of the harpenden building society 
david was appointed nonexecutive chairman of telford homes plc in december 2001 and advises on
all development issues and matters of strategic planning he chairs the remuneration committee and is
a member of the audit committee
andrew wiseman ba hons fcma chief executive 51
andrew wiseman together with close colleagues founded telford homes plc in december 2000
following ten years with furlong homes plc initially as financial director then as chief executive for the
final three years prior to 1990 his experience had been gained in various sectors including seven years
with bat industries andrew has spearheaded the successful flotation of both furlong homes plc and
telford homes plc on aim the former on the launch of aim in 1995 the latter in december 2001 one
year after the company’s formation building on excellent relationships with institutional investors
under his stewardship pretax profit has grown from £13 million in march 2002 to £177 million in
march 2008 andrew has been especially involved in the cementing of relationships between telford
homes plc and affordable housing providers which have been central to the growth of the company 
david durant group planning  design director 46
david durant is a cofounder of telford homes plc and has over 20 years experience in the construction
and house building sectors including 14 years at furlong homes where he was group technical director
from 1997 to 2000 david had been group managing director since the start of the company’s
operations in 2001 in 2005 he supervised devolving responsibility for the finished telford homes
product into two divisions in order to handle the high level of growth in units under construction
following the restructuring of the board in august 2007 david’s role has changed to focus more on
major planning consents product design and maintaining key partnerships 
jonathan distefano ma econ aca financial director 33
jon distefano joined telford homes plc as financial director in october 2002 he had one year with
mothercare following five years with arthur andersen apart from financial matters jon also has board
responsibility for personnel issues there has been extensive growth in both areas with annual turnover
up from £253 million to £1604 million in the five years to march 2008 and jon has developed a significant
finance team the role jon has played in nurturing the trust and support of our banking partners with
the constant high quality of his financial reporting and in developing relationships with institutional
investors through regular presentations has proved invaluable to the success of the company 
james furlong land director 72
jim furlong has over 40 years experience in all aspects of the construction and building industry
through his involvement in roofing civil engineering construction and house building companies
which all bore the ‘furlong’ name prior to joining telford homes as land director jim was a driving
force within furlong homes where he was chairman with specific responsibility for land acquisition
jim’s wide experience of land acquisition played a central role in the initial growth of telford homes
and he has overseen a significant strengthening of the land buying department in the last two years
this is reflected in a development pipeline which at march 2008 consisted of 1388 properties with
planning consent and 454 properties subject to the planning process 
sheena ellwood ba hons dip int marketing sales  marketing director 49
sheena ellwood joined telford homes plc as sales  marketing director in january 2003 prior to this
her experience includes consumer goods export and eight years as regional sales  marketing
director for wimpey homes sheena’s contribution to the growth of telford homes plc can be
measured by a significant rise in the number of contracts exchanged during the last six years from
112 private open market homes in the year to march 2003 to 523 in the year to march 2008 sheena
has developed an extensive sales  marketing team at telford homes plc and set up a customer
service department that plays an important role in building relationships with individual customers
and investors in our properties 
43     annual report and accounts 2008
telford ra  24608  1757  page 44 company secretary registered number
margaret turner 4118370
registered office
first floor stuart house queensgate britannia road waltham cross hertfordshire en8 7tf
auditors
pricewaterhousecoopers llp 10 bricket road st albans hertfordshire al1 3jx
bankers
allied irish bank the manor house high street wanstead london e11 2rl
the royal bank of scotland 1st floor conqueror house vision park chivers way cambridge cb4 9by
barclays bank corporate banking centre po box 729 eagle point 1 capability green luton lu1 3us
solicitors
s j berwin 222 gray’s inn road london wc1x 8xf
coldham shield  mace 123 station road chingford london e4 6ag
nominated broker
shore capital stockbrokers limited bond street house 14 clifford street london w1s 4ju
financial and nominated advisor
shore capital and corporate limited bond street house 14 clifford street london w1s 4ju
registrars
capita registers northern house woodsome park fenay bridge huddersfield west yorkshire hd8 0la
financial public relations
abchurch communications limited 100 cannon street london ec4n 6eu
corporate governance
robert clarke fca nonexecutive director 65
robert clarke was a partner in binder hamlyn and subsequently arthur andersen until his retirement
in 2000 he is currently senior nonexecutive director of huntleigh technology plc and deputy
chairman of ro group robert joined telford homes plc as a nonexecutive director at the time of
the aim flotation in december 2001 and he has been influential in the fields of corporate
governance and strategic direction robert is chairman of the audit committee and a member of the
remuneration committee he is also a member of the audit committee of the church commissioners
and of the royal shakespeare company
john fitzgerald joint group managing director 37
john fitzgerald began his career with willmot dixon and has over 20 years experience in the construction
and house building sector he spent the four years prior to joining telford homes as project and contract
manager with furlong homes where he was responsible for some of their more prestigious
developments he joined telford homes in february 2003 and was jointly responsible for construction
until march 2005 when following restructuring he was appointed divisional managing director of
telford homes alto where he has built a very successful team john was appointed a director on the 
1st august 2007 and takes over from david durant as the director with responsibility for health and safety
mark parker joint group managing director 45
mark parker joined the wimpey group as a management trainee in 1981 and spent the following 21 years
with various wimpey divisions culminating in the post of construction director for mcalpine homes east
he spent the next three years as one of the two initial directors of the new north london division of
kingsoak homes appointed as construction director he was involved in all aspects of the new division
from land acquisition to sales and customer care mark joined telford homes in february 2005 as
divisional managing director of telford homes metro and has been influential in developing strong
partnerships with housing associations mark was appointed a director on the 1st august 2007 and jointly
with john fitzgerald has taken on the duties and responsibilities of group managing director
annual report and accounts 2008     44
telford ra  24608  1757  page 45 application of principles
although not formally required to do so the directors have sought to embrace the principles contained in the
combined code 2003 the code and the 2006 revised version applicable to fully listed companies in formulating
and applying the company’s corporate governance policies these policies are monitored to ensure that they are
appropriate to the company’s circumstances and comply as far as possible with the provisions of the code given
the size of the company 
directors
the company is managed by a board of directors and they have the necessary skills and experience to effectively
operate and control the business there are nine directors in total of whom two are nonexecutive directors 
david holland and robert clarke the nonexecutive directors are considered independent and they comprise both
the audit and remuneration committees the board meets once a month and the directors make every effort to
attend all board meetings
the board is responsible for taking all major strategic decisions and also addressing any significant operational
matters in addition the board reviews the risk profile of the company and ensures that an adequate system of
internal control is in place management information systems are in place to enable the directors to make
informed decisions to properly discharge their duties
the roles of the chairman and the chief executive are separate the chairman is responsible for running the board
and he meets regularly and separately with the chief executive and the other nonexecutive director to discuss
matters for the board
as the business has developed the composition of the board has been under constant review to ensure that it
remains appropriate to the managerial requirements of the company one third of the directors retire annually in
rotation in accordance with the company’s articles of association this enables the shareholders to decide on the
election of their company’s board
the board takes decisions regarding the appointment of new directors as a whole and this is only done following a
thorough assessment of a potential candidates skills and suitability for the role new directors are given a full
induction to the company where required so as to ensure they can properly fulfil their role and meet their
responsibilities
all directors are offered appropriate training to develop their knowledge and ensure they remain up to date in
relevant matters for which they have responsibility as a member of the board
the chairman’s statement and chief executive’s review included in this annual report give the board’s current
assessment of the company’s prospects the directors are responsible for preparing the financial statements as set
out in the statement of directors’ responsibilities the responsibilities of the auditors are set out in their report
remuneration committee
details concerning the composition and meetings of the remuneration committee are contained in the directors’
remuneration report on pages 47 to 48
policy on corporate governance
45     annual report and accounts 2008
telford ra  24608  1757  page 46 corporate governance
audit committee
during the period the audit committee which is chaired by robert clarke an independent nonexecutive director
has met three times with the external auditors being in attendance on two occasions the nonexecutive directors
meet separately with the auditors once a year 
the committee has a responsibility for reviewing the financial statements provided to shareholders in addition the
committee reviews the business and financial risks and internal controls as described below
the duties of the committee also include ensuring that the auditors provide a cost effective service to the company
and remain objective and independent and to consider from time to time the need for an internal audit function
relations with shareholders
the company has institutional shareholders and is where practicable willing to enter into a dialogue with them the
chief executive and the financial director meet regularly with institutional investors within the confines of relevant
legislation and guidance
the board invites communication from its private investors and encourages participation by them at the 
annual general meeting agm all board members present at the agm are available to answer questions from
shareholders notice of the agm in excess of 21 clear days is given and the business of the meeting is conducted with
separate resolutions voted on initially by a show of hands and with the result of the voting being clearly indicated
internal control
the board is responsible for the company’s system of internal control and for reviewing its effectiveness such a
system is designed to mitigate the risk of failure to achieve business objectives and can only provide reasonable
but not absolute assurance against material misstatement or loss
the board is of the view that there is an ongoing process for identifying evaluating and managing the company’s
significant risks and that it has been in place for the period ended 31st march 2008 and up to the date of
approval of the annual report and accounts and that it is regularly reviewed by the board
the internal control procedures are delegated to executive directors and senior management in the company
operating within a clearly defined departmental structure the board regularly reviews the internal control
procedures in the light of the ongoing assessment of the company’s significant risks
on a monthly basis management accounts including a comprehensive cash flow forecast are reviewed by the
board in order to provide effective monitoring of financial performance at the same time the board considers
other significant strategic organisational and compliance issues to ensure that the company’s assets are
safeguarded and financial information and accounting records can be relied upon the board formally monitors
monthly progress on each development
going concern
the directors consider that the funds available to the company are sufficient for its operation for the
foreseeable future
annual report and accounts 2008     46
telford ra  24608  1757  page 47 the directors present the remuneration report for the year ended 31st march 2008
composition of the remuneration committee
the remuneration committee comprises the independent nonexecutive directors david holland and 
robert clarke the committee makes recommendations to the board on executive directors’ service agreements
and remuneration in doing so it has undertaken relevant research to ensure that remuneration levels are
competitive with the industry average the committee met twice during the year
remuneration policy
it is the company’s policy to provide remuneration packages sufficient to attract retain and motivate directors of
the quality required to add further incentive the directors have adopted two bonus schemes one applicable to all
staff and a scheme for executive directors and senior management both schemes are dependent on the company
meeting certain financial performance targets the maximum amount that can be earned under the executive
bonus scheme is 100 of basic salary
the company operates a share incentive plan sip in which all employees are entitled to participate the sip exists in
order to increase employee ownership of shares and further details are given in note 17 to the financial statements
during 2006 the company set up a deferred payment share purchase plan dpspp for the benefit of selected
senior employees further details are given in note 17 to the financial statements the remuneration committee is
responsible for approving any offers of shares made under the dpspp 
the board as a whole determines the remuneration of the nonexecutive directors after considering external market
research they do not participate in the bonus schemes or in the group personal pension scheme they are entitled to
participate in the sip 
service contracts
the executive directors have service contracts that can be terminated on 12 months notice these provide for
termination payments equivalent to 12 months basic salary and contractual benefits
the nonexecutive directors have letters of appointment that can be terminated on three months notice
directors’ emoluments
the directors’ emoluments for the year ended 31st march 2008 are as follows
salary benefits pension total total
and fees bonus in kind contributions 2008 2007
andrew wiseman 135000 61600 20742 13500 230842 208068
robert clarke 37500    37500 31500
david durant 130000 61600 12229 13000 216829 198096
jonathan distefano 115000 61600 23052 11500 211152 179793
sheena ellwood 115000 61600 23266 11500 211366 181445
john fitzgerald 76667 61600 14492 7667 160426 
james furlong 110000 61600 35898  207498 192402
david holland 50000    50000 42000
mark parker 76667 61600 16861 7667 162795 
total 845834 431200 146540 64834 1488408 1033304
john fitzgerald and mark parker were appointed as directors on 1st august 2007 
directors’ remuneration report
47     annual report and accounts 2008
telford ra  24608  1757  page 48 corporate governance
directors’ interests in shares and share options
directors’ interests in shares are disclosed in the report of the directors
the share options held by the directors at 31st march 2008 and the movements during the year then ended
were as follows
company 31st march granted exercised 31st march exercise dates
scheme 2007 in year in year 2008 price exercisable
number number number number
jonathan distefano unapproved 60000   60000 75p 1 oct 2005 to 1 oct 2012
approved  14051  14051 2135p 14 feb 2011 to 14 feb 2018
david durant approved  14051  14051 2135p 14 feb 2011 to 14 feb 2018
sheena ellwood unapproved 59732   59732 745p 20 feb 2006 to 20 feb 2013
approved  14051  14051 2135p 14 feb 2011 to 14 feb 2018
john fitzgerald unapproved 160000   160000 75p 1 oct 2005 to 1 oct 2012
approved  14051  14051 2135p 14 feb 2011 to 14 feb 2018
mark parker approved 21660   21660 1385p 17 may 2008 to 17 may 2015
unapproved 50542   50542 1385p 17 may 2008 to 17 may 2015
on 14th february 2008 jonathan distefano david durant john fitzgerald and sheena ellwood were each
granted 14051 share options under the approved scheme at an exercise price of 2135p
in total the sharebased payments charge in respect of directors’ share options was £5772 2007  £nil
by order of the board
david holland
chairman of the remuneration committee
27th may 2008
annual report and accounts 2008     48
telford ra  24608  1757  page 49 the directors present their report and the audited financial statements for the year ended 31st march 2008
review of activities
the principal activity of the company is that of property development
a review of the activities and prospects of the company is given in the chairman’s statement the chief executive’s
review and the financial review on pages 7 to 23 the company is required to prepare a business review
incorporating comments on key performance indicators and this is covered in the review of activities and prospects
the primary key performance indicators are disclosed on page 3
results and dividends
profit after taxation for the year ended 31st march 2008 was £12327000 2007  £9650000
the directors recommend a final dividend of 55p per ordinary share which together with the interim dividend of 45p paid
on 14th january 2008 makes a total of 100p for the year 2007 – 89p
substantial shareholdings
as at 16th may 2008 the company had been advised of the following notifiable interests in its ordinary share capital
number percentage
held
artemis investment management ltd 3240960 864
rathbone brothers plc 1966200 524
midas capital plc 1877500 501
t d waterhouse nom r stokes 1607760 429
k p furlong 1541000 411
j p morgan asset management uk ltd 1314998 351
d g furlong 1300000 347
m trim 1194000 318
directors
details of the directors of the company are shown on pages 43 to 44
john fitzgerald and mark parker were appointed to the board on the 1st august 2007 both retire at the next
annual general meeting and being eligible offer themselves for reelection 
robert clarke and jonathan distefano retire by rotation at the next annual general meeting and being eligible
offer themselves for reelection 
report of the directors
49     annual report and accounts 2008
telford ra  24608  1757  page 50 corporate governance
directors’ interests
the directors of the company are listed below together with their interest in the shares of the company at 
31st march 2008 and movements in the year
at 31st share market at 31st
march 2007 incentive acquisitions march 2008
plan and disposals
number number number number
andrew wiseman 2185339 1967 23258 2210564
robert clarke 109246 1967  111213
jonathan distefano 330246 1967  332213
david durant 1049246 1967 15000 1066213
sheena ellwood 334514 1967  336481
john fitzgerald 191292 1967  193259
james furlong 1079006 1967 44000 1124973
david holland 959246 1967 20000 981213
mark parker 153921 1967  155888
these interests include shares purchased under the telford homes share incentive plan sip which all employees
including directors are eligible to participate in all shares purchased under the sip are matched by shares
provided by the company on a one for one basis these ‘matching’ shares are also included in the interests stated
but must remain in the sip for a period of not less than three years otherwise they are forfeited further details
on the sip are included in note 17 to the financial statements
details of share options held by directors are given in the directors’ remuneration report on pages 47 to 48
investment in own shares
the company’s investment in own shares relates solely to employee share schemes and further details of the total
holding and movements in the holding are disclosed in note 17
creditors
it is company policy to settle all debts with its creditors on a timely basis subcontractors are paid upon agreement
of the value of works completed based on their applications for payment and the terms agreed in general other
suppliers are paid during the month following the month of receipt of the invoice unless other terms have been
specifically agreed
at 31st march 2008 trade creditors represented 14 days purchases 2007 – 12 days
employees
the company places considerable value on the involvement of its employees and keeps them informed of all
relevant matters on a regular basis telford homes is an equal opportunities employer and all applications for
employment are considered fully on the basis of suitability for the job
annual report and accounts 2008     50
telford ra  24608  1757  page 51 report of the directors
charitable donations
the company made charitable donations of £17000 2007  £14100 these donations were made to a number of
different charities supporting a broad range of good causes
annual general meeting
the annual general meeting will be held at the registered office at first floor stuart house queensgate
britannia road waltham cross hertfordshire on the 10th july 2008 at 1230pm
auditors
a resolution to reappoint pricewaterhousecoopers llp as auditors to the company will be proposed at the 
annual general meeting in accordance with section 385 of the companies act 1985
each of the directors at the time this report was approved has confirmed the following
• so far as each director is aware there is no relevant audit information of which the company’s auditors are unaware
• each director has taken steps including appropriate enquiries of fellow directors in order to be aware of any
information needed by the company’s auditors in connection with preparing their report and to establish that
the company’s auditors are aware of that information
by order of the board
margaret turner
company secretary
27th may 2008
51     annual report and accounts 2008
telford ra  24608  1757  page 52 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 international financial reporting
standards ifrs as adopted by the european union the financial statements are required by law to give a true
and fair view of the state of affairs of the company and of the profit or loss of the company for that period 
in preparing those 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 that the financial statements comply with ifrs as adopted by the european union
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company
will continue in business in which case there should be supporting assumptions or qualifications as necessary
the directors confirm that they have complied with the above requirements in preparing the financial statements
the directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at any
time the financial position of the company 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 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 company’s website legislation in the
united kingdom governing the preparation and dissemination of financial statements may differ from legislation
in other jurisdictions
annual report and accounts 2008     52
telford ra  24608  1757  page 53 independent auditors’ report to the members of telford homes plc
we have audited the financial statements of telford homes plc for the year ended 31st march 2008 which comprise
the income statement the balance sheet the statement of changes in equity the cash flow statement the
statement of accounting policies and the related notes
respective responsibilities of directors and auditors
the directors’ responsibilities for preparing the annual report and the financial statements in accordance with
applicable law and international financial reporting standards ifrs as adopted by the european union 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 this report including the opinion has
been prepared for and only for the company’s members as a body in accordance with section 235 of the
companies act 1985 and for no other purpose we do not in giving this opinion accept or assume responsibility
for any other purpose or to any other person to whom this report is shown or into whose hands it may come save
where expressly agreed by our prior consent in writing
we report to you our opinion as to whether the financial statements give a true and fair view and whether the
financial statements 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 report of the directors is consistent with the financial
statements the information given in the report of the directors includes that specific information presented in the
chief executive’s review and the financial review that is cross referred from the review of activities section of the
report of the directors
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 financial highlights the chairman’s statement the
chief executive’s review the financial review area of operation operational structure key risks and uncertainties
health and safety environment and sustainability customer service directors and advisors the policy on corporate
governance the directors’ remuneration report and the report of the directors 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
auditors’ report
53     annual report and accounts 2008
telford ra  24608  1757  page 54 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 company’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 in accordance with ifrs as adopted by the european union of
the state of the company’s affairs as at 31st march 2008 and of its profit and cash flows 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 report of the directors is consistent with the financial statements
pricewaterhousecoopers llp
chartered accountants and registered auditors st albans
27th may 2008
annual report and accounts 2008     54
telford ra  24608  1757  page 55 telford ra  24608  1757  page 56 financial statements
direction
“east london is moving in the right direction
telford homes is part of that process and
will remain so for many years to come”
telford ra  24608  1757  page 57 income statement 31st march 2008
note year ended year ended
31st march 2008 31st march 2007
£000 £000
revenue 160433 104383
cost of sales 126855 81001
gross profit 33578 23382
administrative expenses 8208 6676
operating profit 1 25370 16706
finance income 3 493 794
finance costs 3 8136 3985
profit before income tax 17727 13515
income tax expense 4 5400 3865
profit from continuing operations after tax 12327 9650
earnings per share
basic 6 333p 294p
diluted 6 331p 285p
all activities are in respect of continuing operations
57     annual report and accounts 2008
telford ra  24608  1757  page 58 balance sheet 31st march 2008
note 31st march 2008 31st march 2007
£000 £000
non current assets
property plant and equipment 7 822 851
deferred income tax assets 13  226
822 1077
current assets
inventories 9 74446 70135
trade and other receivables 10 120174 56104
cash and cash equivalents 11 4698 17617
199318 143856
total assets 200140 144933
non current liabilities
hire purchase liabilities 12 18 96
deferred income tax liabilities 13 4 
22 96
current liabilities
trade and other payables 14 32393 15028
current income tax liabilities 1971 1655
borrowings 15 101424 73210
hire purchase liabilities 12 83 113
135871 90006
total liabilities 135893 90102
net assets 64247 54831
capital and reserves
issued share capital 16 3750 3694
share premium 29749 28641
retained earnings 30748 22496
total equity 64247 54831
these financial statements were authorised for issue by the board of directors on 27th may 2008 and
signed on its behalf by
andrew wiseman jonathan distefano
chief executive financial director
annual report and accounts 2008     58
telford ra  24608  1757  page 59 share share retained total
capital premium earnings equity
£000 £000 £000 £000
balance at 1st april 2006 2981 12656 16848 32485
profit for the year   9650 9650
dividend on equity shares   2867 2867
movement in excess tax   281 281
on share options
shares issued under deferred 55 1375 1430 
payment share purchase plan
proceeds of equity share issue 658 15237  15895
costs arising from shares issued  627  627
sharebased payments   90 90
purchase of own shares   365 365
sale of own shares   180 180
movement arising from write   109 109
down in value of own shares
balance at 31st march 2007 3694 28641 22496 54831
profit for the year   12327 12327
dividend on equity shares   3498 3498
movement in excess tax   194 194
on share options
shares issued under deferred 16 374 390 
payment share purchase plan
proceeds of equity share issue 40 734  774
sharebased payments   109 109
purchase of own shares   422 422
sale of own shares   211 211
movement arising from write   109 109
down in value of own shares
balance at 31st march 2008 3750 29749 30748 64247
statement of changes in equity 31st march 2008
59     annual report and accounts 2008
telford ra  24608  1757  page 60 cash flow statement 31st march 2008
year ended year ended
31st march 2008 31st march 2007
£000 £000
cash flow from operating activities
operating profit 25370 16706
depreciation 358 360
write down in value of own shares 109 109
sharebased payments 109 90
profit on sale of tangible assets 24 34
increase in inventories 4311 24588
increase decrease in receivables 64070 3347
increase in payables 16629 4870
25830 860
interest paid 7400 3900
income taxes paid 5048 3554
cash flow from operating activities 38278 6594
cash flow from investing activities
purchase of tangible assets 329 182
proceeds from sale of tangible assets 24 38
interest received 493 794
cash flow from investing activities 188 650
cash flow from financing activities
proceeds from issuance of ordinary share capital 774 15895
expenses of share issue  627
purchase of own shares 422 365
sale of own shares 211 180
increase in bank loans 59825 52241
repayment of bank loans 31611 47984
dividend paid 3498 2867
capital element of hire purchase payments 108 123
cash flow from financing activities 25171 16350
net decrease increase in cash and cash equivalents 12919 10406
cash and cash equivalents brought forward 17617 7211
cash and cash equivalents carried forward 4698 17617
annual report and accounts 2008     60
telford ra  24608  1757  page 61 statement of accounting policies 31st march 2008
basis of preparation
the financial statements have been prepared in accordance with international financial reporting standards
ifrs as adopted by the european union and ifric interpretations and with those parts of the companies
act 1985 applicable to companies reporting under ifrs these are the companys first financial statements
prepared under ifrs and ifrs 1 has been applied an explanation of how the transition to ifrs has affected
the reported financial position financial performance and cash flows of the company is provided in note 21
the preparation of financial statements in conformity with generally accepted accounting principles requires
the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses during the reporting period
although these estimates are based on the directors best knowledge of the amounts events or actions actual
results ultimately may differ from those estimates the most significant estimates made by the directors in these
financial statements are set out in critical accounting judgements and key sources of estimation uncertainty
the company has a dormant subsidiary and has elected to apply the companies act 1985 exemption from
preparing consolidated financial statements on the basis that the subsidiary is immaterial instead the
company has prepared economic interest financial statements in which the companys share in jointly
controlled entities is proportionally consolidated
the accounting policies set out below have been applied consistently for all periods presented in these
financial statements and in preparing an opening ifrs balance sheet at 1st april 2006 for the purpose of
the transition to ifrs
accounting convention
the financial statements have been prepared under the historical cost convention and in accordance with
applicable international accounting standards
jointly controlled entities
a jointly controlled entity is an entity in which the company holds an interest with one or more other
parties where a contractual arrangement has established joint control over the entity jointly controlled
entities are accounted for using proportional consolidation
revenue and profit recognition
revenue is recognised from the date of exchange of contracts for the sale of properties at a rate
equivalent to the value of work undertaken in respect of land development the value of revenue less
deposits and completion monies received is included as amounts recoverable on contracts within trade
receivables all revenue is generated in the united kingdom 
profit on developments is recognised over the life of each development in proportion to revenue only to
the extent that the total eventual profit on the development can be foreseen with reasonable certainty
until there is reasonable certainty over the final outcome of a development the profit is restricted to the
nonrefundable deposits received losses are provided for as soon as foreseen
commission received on property sales made on behalf of third parties is recorded within revenue with all
costs associated with the sale of those properties recognised within cost of sales
finance leases and hire purchase contracts
leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks
and rewards of ownership to the lessee all other leases are classified as operating leases
assets held under finance leases and hire purchase contracts are recognised as assets of the company at their
fair value or if lower at the present value of the minimum lease payments each determined at the inception of
the lease and depreciated over the shorter of their expected useful lives and the lease term the corresponding
liability is included in the balance sheet as a finance lease or hire purchase obligation lease payments are
apportioned between finance charges and reduction of the lease obligations so as to achieve a constant rate of
interest on the remaining balance of the liability finance charges are charged to the income statement
61     annual report and accounts 2008
telford ra  24608  1757  page 62 operating leases
operating lease rentals are charged to the income statement on a straight line basis over the life of the lease
pension costs
contributions paid to group personal pension schemes defined contribution in respect of employees are
charged to the income statement as incurred
property plant and equipment
property plant and equipment is stated at cost less accumulated depreciation depreciation is provided on
a straight line basis at rates calculated to write down the cost less estimated residual value of each asset
over its expected useful life as follows
leasehold improvements  shorter of term of lease and 10 years
plant and machinery  2 to 5 years
motor vehicles  3 years
inventories
development properties are included in inventories and are stated at the lower of cost and net realisable
value cost comprises costs of acquisition and development including directly attributable fees and
expenses and direct labour costs but not loan interest included within development properties are
freehold interests held in completed developments these are held for future sale 
financial instruments
financial assets and financial liabilities are recognised on the companys balance sheet when the company
becomes a party to the contractual provision of the instrument
trade receivables and other receivables
trade receivables on normal terms do not carry any interest and are stated at their nominal value reduced
by appropriate allowances for estimated unrecoverable amounts
cash and cash equivalents
cash and cash equivalents are defined as cash balances in hand and in the bank including shortterm cash
deposits which mature within three months or less from the date of acquisition
borrowings
interest bearing bank loans and overdrafts are recorded at the proceeds received interest payable on
bank loans and overdrafts is written off to the income statement using the effective interest method 
trade payables
trade payables on normal terms are not interest bearing and are stated at their nominal value
land creditors
when land is purchased on extended payment terms the company initially records it at its fair value with
a land creditor recorded for any outstanding monies based on this fair value assessment fair value is
determined by using the effective interest method the difference between the nominal value and the
initial fair value is amortised over the period of the extended credit term and charged to finance costs
increasing the value of the land creditor so that at the date of maturity the land creditor equals the
payment required
financial liabilities and equity instruments
financial liabilities and equity instruments are classified according to the substance of the contractual
arrangements entered into an equity instrument is any contract that evidences a residual interest in the
assets of the company after deducting all of its liabilities equity instruments issued by the company are
recorded at the proceeds received net of direct issue costs
annual report and accounts 2008     62
telford ra  24608  1757  page 63 statement of accounting policies 31st march 2008
current assets and liabilities
assets that are expected to be realised in or are intended for sale or consumption in the companys
normal operating cycle are treated as current even to the extent these are expected to be realised after
twelve months from the balance sheet date liabilities that are expected to be settled in the companys
normal operating cycle are treated as current even though these may be due for settlement after twelve
months from the balance sheet date
contingent liabilities
disclosures are made for each class of contingent liabilities at the balance sheet date detailing where
practicable an estimate of their financial effect and an indication of uncertainties associated with the
timing or amount of the outflow unless the possibility of a financial outflow is remote
taxation
the tax expense represents the sum of the tax currently payable and deferred tax
the tax currently payable is based on the profits for the year taxable profit differs from net profit as reported
in the income statement because it excludes items of income or expense that are tax deductible in other years
and it further excludes items that are never taxable or deductible the companys liability for current tax is
calculated using tax rates that have been enacted or substantially enacted by the balance sheet date
deferred tax is recognised in respect of all temporary differences that have originated but not reversed at
the balance sheet date where transactions or events that result in an obligation to pay more tax in the
future or a right to pay less tax in the future have occurred at the balance sheet date
a net deferred tax asset is regarded as recoverable and therefore recognised only when on the basis of all
available evidence it can be regarded as more likely than not that there will be suitable taxable profits
from which the future reversal of the underlying timing differences can be deducted
deferred tax is charged or credited to the income statement except when it relates to items charged or
credited directly to equity in which case the deferred tax is also dealt with in equity
sharebased payments
in accordance with ifrs 2 the fair value of equity settled share options granted is recognised as an
employee expense with a corresponding increase in equity the fair value is measured as at the date the
options are granted using the blackscholesmerton pricing model and is charged equally over the vesting
period the amount recognised as an expense is adjusted each reporting period to reflect the actual
number of options that are expected to vest
with respect to sharebased payments a deferred tax asset is recognised on the relevant tax base 
the tax base is then compared to the cumulative sharebased payment expense recognised in the income
statement deferred tax arising on the excess of the tax base over the cumulative sharebased payment
expense recognised in the income statement has been recognised directly in equity
own shares
shares held by employee benefit trusts in order to satisfy awards under the companys share plans are
included net within equity until such time as the shares are vested to the relevant employees
critical accounting judgements and key sources of estimation uncertainty
revenue and profit recognition
revenue is recognised from the date of exchange of contracts for the sale of properties at a rate
equivalent to the value of work undertaken in respect of land development profit on developments is
recognised in proportion to revenue only to the extent that the total eventual profit on the development
can be foreseen with reasonable certainty
63     annual report and accounts 2008
telford ra  24608  1757  page 64 annual report and accounts 2008     64
assessing the percentage complete on each development involves estimation of total expected costs to be incurred
until the end of the development recognition of profit also involves estimation of the total expected revenue
from each development and therefore the expected profit margin that will be achieved judgement is required
to assess whether the total eventual profit on each development can be foreseen with reasonable certainty
carrying value of land and work in progress
inventories include land and work in progress in respect of development sites in some cases land is held
awaiting a planning consent on each development judgement is required to assess whether the cost of
land and any associated work in progress is in excess of its net realisable value
recent accounting developments
at the date of the authorisation of these financial statements there are a number of standards
amendments and interpretations that have been published the company has not early adopted any
standards amendments or interpretations
the standards amendments and interpretations that are expected to impact upon the company are
ias 23 amendment borrowing costs the amendment to the standard requires an entity to capitalise
borrowing costs directly attributable to the acquisition construction or production of a qualifying asset
one that takes a substantial period of time to get ready for use or sale as part of the cost of that asset
the option of immediately expensing borrowing costs is removed the amendment will apply to the
company from the annual period commencing 1st april 2009
ias 1 amendment presentation of financial statements this amendment prohibits the presentation of items
of income and expense that is nonowner changes in equity in the statement of changes in equity revised
ias 1 also sets out the additional disclosure requirements for entities making restatements or reclassifications
the amendment will apply to the company from the annual period commencing 1st april 2009
ifrs 2 amendment sharebased payments this amendment clarifies that vesting conditions are service
and performance conditions only it also specifies that all cancellations should receive the same accounting
treatment whether cancelled by the entity or by other parties the amendment will apply to the
company from the annual period commencing 1st april 2009
the following standards amendments and interpretations are not expected to have any material impact
on the financial statements of the company
ifrs 3 amendment business combinations applies to the company from the annual period commencing
1st april 2010 this standard includes some significant changes to how the acquisition method is applied
to business combinations
ifrs 8 operating segments applies to the company from the annual period commencing 1st april 2009
ifrs 8 amends the current segmental reporting requirement of ias 14 and requires management
approach to be adopted so that segment information is presented on the same basis as that used for
internal reporting purposes  
ias 27 amendment consolidated and separate financial statements applies to the company from the
annual period commencing 1st april 2010 the revised standard requires the effects of all transactions
with noncontrolling interests to be recorded in equity if there is no change in control
ias 32 amendment financial instruments presentation and ias 1 amendment presentation of
financial statements  puttable instruments and instruments with obligations arising on liquidation
applies to the company from the annual period commencing 1st april 2009
ifric 12 service concession arrangements applies to the company from the annual period commencing
1st april 2008
ifric 13 customer loyalty programmes applies to the company from the annual period commencing
1st april 2008
ifric 14 the limit on a defined benefit asset minimum funding requirements and their interaction
applies to the company from the annual period commencing 1st april 2008
telford ra  24608  1757  page 65 notes to the financial statements 31st march 2008
1 operating profit year ended year ended
31st march 2008 31st march 2007
£000 £000
operating profit is stated after charging crediting
depreciation  owned assets 230 204
 hire purchase assets 128 156
operating lease rentals  property 162 162
 motor vehicles 216 175
 plant and machinery  3
profit on sale of tangible assets 24 34
in addition the following has been charged in respect of auditors’ remuneration
audit and related services pricewaterhousecoopers llp
statutory audit of the financial statements 59 57
other services including nonaudit services pricewaterhousecoopers llp
the audit of jointly controlled entity accounts pursuant to legislation 7 5
other services provided pursuant to such legislation  
other services relating to taxation 23 13
all other services 21 22
other services including nonaudit services moore stephens llp
the audit of jointly controlled entity accounts pursuant to legislation  8
other services provided pursuant to such legislation  5
other services relating to taxation  14
65     annual report and accounts 2008
telford ra  24608  1757  page 66 annual report and accounts 2008     66
2 employee benefit expense
the average monthly number of persons employed by the company including executive directors during
the year analysed by activity was as follows
year ended year ended
31st march 2008 31st march 2007
number number
construction 88 67
administration 62 50
150 117
the employment costs of all employees included above were
year ended year ended
31st march 2008 31st march 2007
£000 £000
wages and salaries 8045 6278
social security costs 901 686
other pension costs  group personal pension arrangements 324 252
9270 7216
the company operates a group personal pension scheme for its employees at 31st march 2008 payments
of £47000 were due to the scheme 2007  £32000
six current directors are accruing benefits under group personal pension arrangements 2007  four
key management remuneration
key management personnel as defined under ias 24 related party disclosures have been identified
as the directors as all key decisions are reserved for the board mark parker and john fitzgerald were
appointed to the board on 1st august 2007 and prior to this held key management positions that involved
reporting directly to the board their employment costs have been included for the full year ended 
31st march 2008 and the year ended 31st march 2007 
year ended year ended
31st march 2008 31st march 2007
£000 £000
wages and salaries including bonuses 1516 1336
social security costs 152 132
other pension costs 73 62
sharebased payments 6 5
1747 1535
detailed disclosures of directors’ individual remuneration pension entitlement and share options for those
directors who served in the year are given in the directors’ remuneration report on pages 47 to 48
telford ra  24608  1757  page 67 notes to the financial statements 31st march 2008
3 finance income and costs year ended year ended
31st march 2008 31st march 2007
£000 £000
finance income 
interest income on shortterm bank deposits 493 794
finance costs
interest payable on bank loans and overdrafts 7607 3965
hire purchase finance charges 12 15
amortisation of interest on land creditors 517 5
8136 3985
net finance costs 7643 3191
67     annual report and accounts 2008
telford ra  24608  1757  page 68 4 taxation year ended year ended
31st march 2008 31st march 2007
£000 £000
united kingdom corporation tax at a rate of 30 2007  30 5279 3800
adjustment in respect of prior periods 85 178
total current taxation 5364 3622
deferred taxation note 13 36 243
income tax expense 5400 3865
in addition to the amount charged to the income statement deferred tax of £194000 relating to share
based payments was charged directly to equity 2007  credit of £281000
reconciliation of effective tax rate
the tax assessed for the year is higher 2007  lower than the standard rate of corporation tax in the uk
of 30 2007  30 the differences are explained below
profit before income tax 17727 13515
profit before income tax at standard rate of 5318 4054
corporation tax in the uk of 30 2007  30
effects of
adjustment in respect of prior periods 85 178
expenses not deductible for tax purposes 38 28
tax relief on land remediation costs 41 39
income tax expense 5400 3865
factors affecting future tax charges
on 21st march 2007 it was announced that the corporation tax rate will reduce from 30 to 28 with
effect from 1st april 2008 this was substantially enacted on the 26th june 2007 deferred tax is calculated
using a 28 rate
annual report and accounts 2008     68
telford ra  24608  1757  page 69 notes to the financial statements 31st march 2008
5 dividend paid year ended year ended
31st march 2008 31st march 2007
£000 £000
prior year final dividend paid in july 2007 of 49p july 2006  46p 1818 1391
interim dividend paid in january 2008 of 45p january 2007  40p 1680 1476
3498 2867
the final dividend proposed for the year ended 31st march 2008 is 55p per ordinary share this dividend was
declared after 31st march 2008 and as such the liability of £2062000 has not been recognised at that date
6 earnings per share
basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the
weighted average number of ordinary shares outstanding during the year excluding those held in the
share incentive plan for diluted earnings per share the weighted average number of ordinary shares in
issue is adjusted to assume conversion of all dilutive potential ordinary shares
earnings per share have been calculated using the following figures 
year ended year ended
31st march 2008 31st march 2007
weighted average number of shares in issue 36971367 32781546
dilution  effect of share schemes 318266 1054146
diluted weighted average number of shares in issue 37289633 33835692
profit from continuing operations after tax £12327000 £9650000
earnings per share
basic 333p 294p
diluted 331p 285p
69     annual report and accounts 2008
telford ra  24608  1757  page 70 7 property plant and equipment
leasehold plant and motor
improvements machinery vehicles total
£000 £000 £000 £000
cost
at 1st april 2006 256 805 427 1488
additions 5 137 202 344
disposals   133 133
at 31st march 2007 261 942 496 1699
additions 1 328  329
disposals  284 91 375
at 31st march 2008 262 986 405 1653
depreciation
at 1st april 2006 6 394 217 617
charge 25 179 156 360
disposals   129 129
at 31st march 2007 31 573 244 848
charge 27 203 128 358
disposals  284 91 375
at 31st march 2008 58 492 281 831
net book value
at 31st march 2007 230 369 252 851
at 31st march 2008 204 494 124 822
motor vehicles with a net book value of £124000 are held under hire purchase arrangements 2007 
£252000 depreciation of £128000 was charged during the year on these assets 2007  £156000
authorised future capital expenditure that was contracted but not provided for in these financial
statements amounted to £nil 2007  £nil
annual report and accounts 2008     70
telford ra  24608  1757  page 71 notes to the financial statements 31st march 2008
8 investments
investment in subsidiary undertaking
at 31st march 2008 the company held 100 of the issued share capital of island gardens limited a
company registered in england and wales which had been incorporated to assist the company in carrying
out a joint activity island gardens limited is a dormant company with share capital of £2 telford homes plc
does not prepare consolidated financial statements as island gardens limited is immaterial to the
operations of the group
jointly controlled entities
at 31st march 2008 the company held 50 of the issued share capital of telford homes stratford
limited a company registered in scotland which has been incorporated to assist the company in carrying
out a joint property development
at 31st march 2008 the company held 50 of the issued share capital of telford homes creekside
limited a company registered in scotland which has been incorporated to assist the company in carrying
out a joint property development
at 31st march 2008 the company held 50 of the issued share capital of bishopsgate apartments llp a
limited liability partnership registered in england which has been incorporated to assist the company in
carrying out a joint property development
9 inventories 31st march 2008 31st march 2007
£000 £000
development properties 74446 70135
all inventories are considered to be current in nature the operating cycle is such that a proportion of
inventories will not be realised within twelve months it is not possible to determine with accuracy when
specific inventory will be realised as this will be subject to a number of issues such as consumer demand
and planning permission delays
included within development properties are freehold interests held for future sale of £2850000 
2007  £2259000
the value of inventories expensed in 2008 and included in cost of sales was £125698000 2007 
£79910000 the value of inventories written down and recognised as an expense in 2008 was £144000
2007  £400000
71     annual report and accounts 2008
telford ra  24608  1757  page 72 10 trade and other receivables 31st march 2008 31st march 2007
£000 £000
current receivables
amounts recoverable on contracts 117530 54155
trade receivables 43 81
other receivables 1878 1479
prepayments and accrued income 723 389
120174 56104
amounts recoverable on contracts include sales proceeds secured on exchanges of contracts less
deposits received adjusted for percentage completion on each development this total includes a net
amount of £44426000 2007  £21009000 which will be received on legal completions expected after
more than one year
amounts recoverable on contracts
contract revenue of £159626000 2007  £103636000 has been recognised in the year
in relation to contracts in progress at the balance sheet date
31st march 2008 31st march 2007
£000 £000
contracts where costs incurred plus recognised profits 117530 54155
exceed payments to date
total costs incurred plus recognised profits on contracts 381143 226251
payments to date 263613 172096
117530 54155
at 31st march 2008 retentions held by customers for contract work amounted to £947000 2007  £528000
11 cash and cash equivalents 31st march 2008 31st march 2007
£000 £000
cash at bank and in hand 4698 17617
annual report and accounts 2008     72
telford ra  24608  1757  page 73 notes to the financial statements 31st march 2008
12 hire purchase liabilities 31st march 2008 31st march 2007
£000 £000
gross hire purchase liabilities
due within one year 87 125
due in more than one year and less than five years 18 100
105 225
less future interest 4 16
net hire purchase liabilities 101 209
net hire purchase liabilities are repayable as follows
due within one year 83 113
due in more than one year and less than five years 18 96
101 209
13 deferred income tax 31st march 2008 31st march 2007
£000 £000
deferred tax assets 76 347
deferred tax liabilities 80 121
deferred tax liabilities assets 4 226
as permitted by ias 12 income taxes certain deferred tax assets and liabilities have been offset as they
arise in the same tax jurisdiction and are settled on a net basis 
the movement on the deferred income tax account is as follows
31st march 2008 31st march 2007
£000 £000
brought forward 226 188
charged to the income statement 36 243
charged credited directly to equity 194 281
4 226
73     annual report and accounts 2008
telford ra  24608  1757  page 74 the movement in deferred tax assets and liabilities during the year is as follows
capital sharebasedland remediation total
allowances transactions timing differences 
£000 £000 £000 £000
at 1st april 2006 8 356 160 188
credited charged to the 59 341 39 243
income statement
credited directly to equity  281  281
at 31st march 2007 51 296 121 226
credited charged to the 8 85 41 36
income statement
charged directly to equity  194  194
at 31st march 2008 59 17 80 4
the aggregate deferred tax credited directly to equity amounts to £411000 2007  £605000
14 trade and other payables 31st march 2008 31st march 2007
£000 £000
trade payables 8126 5555
social security and other taxes 329 247
accrued expenses 10242 7804
land creditors 13696 1422
32393 15028
15 borrowings 31st march 2008 31st march 2007
£000 £000
bank loans 101424 73210 
further information on bank loans is given in note 20
annual report and accounts 2008     74
telford ra  24608  1757  page 75 notes to the financial statements 31st march 2008
16 share capital 31st march 2008 31st march 2007
£000 £000
authorised
100000000 ordinary shares of 10p each 10000 10000
allotted called up and fully paid
37500000 ordinary shares of 10p each 2007  36940475 3750 3694
on 11th june 2007 79570 ordinary shares were issued at 369p to telford homes trustees limited to
satisfy the requirements of the share incentive plan note 17
on 11th june 2007 125430 ordinary shares were issued at 1435p as a result of share options being exercised
on 14th december 2007 146335 ordinary shares were issued at 1435p as a result of share options being exercised
on 14th december 2007 160000 ordinary shares were issued at 244p to abacus corporate trustee limited
to satisfy the requirements of the deferred payment share purchase plan note 17
on 26th march 2008 48190 ordinary shares were issued at 1865p to telford homes trustees limited to
satisfy the requirements of the share incentive plan note 17
ordinary shares may be issued in the future to satisfy the exercise of outstanding share options note 17
details of own shares held within employee benefit trusts are disclosed in note 17
all shares rank equally in respect of shareholder rights
75     annual report and accounts 2008
telford ra  24608  1757  page 76 annual report and accounts 2008     76
17 employee share schemes
telford homes plc employee share option scheme
the company operates both an approved share option scheme and an unapproved share option scheme
awards under each scheme are made periodically to new employees all schemes are equitysettled and
options can normally be exercised three years after the grant date
a charge is made to the income statement to reflect the calculated fair value of employee share options
over and above the exercise price paid by employees this charge is calculated at the date of grant of the
options and is charged equally over the vesting period the corresponding adjustment to equity is made
directly to the profit and loss reserve in accordance with ifrs 2 sharebased payments only costs
relating to options issued after 7th november 2002 have been charged to the income statement
the company has used the blackscholesmerton formula to calculate the fair value of outstanding
options individual calculations have been performed for groups of share options with differing exercise
prices and dates the assumptions applied to the blackscholesmerton formula for share options issued
and the fair value per option are as follows
2008 2007
expected life of options based on options exercised to date 4 years 4 years
volatility of share price based on three year share price history 25  30 20
dividend yield 3  6 2  4
risk free interest rate 525  575 475  5
weighted average share price at date of grant 231p 256p
weighted average exercise price 231p 256p
weighted average fair value per option £042 £045
expected volatility was determined by considering the volatility levels historically for the company volatility
in more recent years is considered to have more relevance than earlier years for the period reviewed
the charge calculated for the year ended 31st march 2008 was £109000 2007  £90000 with a
corresponding deferred tax asset of £30000 2007  £27000 recognised in the year
a reconciliation of option movements during each period is shown below
number weighted average number weighted average
000s exercise price 000s exercise price
2008 2008 2007 2007
outstanding at 1st april 1488 147p 1952 115p
granted in the year 1330 231p 211 256p
forfeited in the year 399 285p 41 146p
exercised in the year 272 143p 634 85p
outstanding at 31st march 2147 173p 1488 147p
exercisable at 31st march 434 90p 456 92p
the aggregate fair value of options granted in the year was £388000 2007  £95000
telford ra  24608  1757  page 77 notes to the financial statements 31st march 2008
77     annual report and accounts 2008
17 employee share schemes continued
during the year 318415 of the options that have been forfeited were replaced with 463683 new options
with an incremental fair value of £9000
the weighted average share price at the point of exercise of share options during the year was 2825p
2007  2634p
at 31st march 2008 outstanding options granted over 10p ordinary shares were as follows
share option scheme option price number dates exercisable
company approved 1435p 20905 5 aug 2007 to 5 aug 2014
1445p 83044 6 jan 2008 to 6 jan 2015
1385p 108300 17 may 2008 to 17 may 2015
1535p 234516 10 nov 2008 to 10 nov 2015
167p 71856 27 feb 2009 to 27 feb 2016
205p 87804 15 june 2009 to 15 june 2016
2135p 1110029 14 feb 2011 to 14 feb 2018
company unapproved 605p 50414 5 mar 2005 to 5 mar 2012
75p 220000 1 oct 2005 to 1 oct 2012
745p 59732 20 feb 2006 to 20 feb 2013
1385p 50542 17 may 2008 to 17 may 2015
167p 50000 27 feb 2009 to 27 feb 2016
telford homes plc share incentive plan
during the year ended 31st march 2004 telford homes plc set up a share incentive plan sip for the
benefit of all of the employees of the company this sip has been approved by the inland revenue and
confers certain tax advantages for participating employees
the sip provides for employees to purchase shares up to a value of £1500 in each tax year these shares
are known as partnership shares partnership shares are matched on a one for one basis by matching
shares provided by the company subject to the shares remaining in the sip for a period not less than
three years dividends are paid on both partnership and matching shares and these are allocated to
employees as dividend shares
the company has set up a trust to administer the sip and to hold shares on behalf of individual
employees this trust is an entirely separate entity to the company and is managed by a corporate trustee
telford homes trustees limited the costs associated with the trust are paid for by the company and the
company finances all share purchases
the trust has distributed shares as partnership shares and dividend shares to employees participating in the
scheme these shares remain in the trust until such time as an employee withdraws from the sip  further shares
have been allocated to employees as matching shares and the cost of these shares is being written off over the
three year holding period the charge in the year ended 31st march 2008 was £109000 2007  £109000
telford ra  24608  1757  page 78 during the year ended 31st march 2008 the trust acquired 9114 shares at 4235p in april 2007 a further
79570 shares at 369p in june 2007 and a further 48190 shares at 1865p in march 2008 at 31st march
2008 the trust remains interested in 7343 shares 2007  41180 which have not been allocated to
employees and a further 217489 2007  206101 that have been allocated to employees as matching
shares but have not yet vested shares in which the trust remains interested do not rank for dividends and
all shares that have not yet vested do not count in the calculation of the weighted average number of
shares used to calculate earnings per share
shares held by the sip are recognised as a deduction from shareholders’ funds the value of these shares
at 31st march 2008 was £305000 2007  £203000 movements in the profit and loss reserve relating to
the sip are shown in the statement of changes in equity
telford homes plc 2006 deferred payment share purchase plan
during the year ended 31st march 2007 telford homes plc set up a deferred payment share purchase plan
dpspp for the benefit of selected senior employees an employee benefit trust the telford homes plc
2006 employee benefit trust was set up with abacus corporate trustee limited acting as trustee
participants in the dpspp are offered a loan by the trustee to enable them to subscribe for a specified
number of shares in the company at market value this loan is interest free and repayable on or before
the repayment date which is normally ten years from the date of the loan or on leaving employment or
disposing of the shares the loan has limited recourse such that repayment is limited to the value of the
shares on the repayment date the company will lend the trustee sufficient funds to enable the trustee to
provide the loans to individual participants all shares acquired under the dpspp will be subject to a three
year vesting period and are held by the trustee for the benefit of the participants offers to participants
will be made periodically at the discretion of the directors of telford homes plc
in september 2006 selected employees were offered and subscribed for a total of 550000 shares at the
market value of 260p these shares were issued on 9th november 2006 on this date the company
provided a loan to the trustee of £1430000 to enable the trustee to provide a loan to each of the
participants this loan is repayable at the earlier of the sale of the vested shares and november 2016 and
has been recognised as a deduction from shareholders’ funds in the statement of changes in equity
in december 2007 selected employees were offered and subscribed for a total of 160000 shares at the
market value of 244p these shares were issued on 14th december 2007 on this date the company
provided a loan to the trustee of £390400 to enable the trustee to provide a loan to each of the
participants this loan is repayable at the earlier of the sale of the vested shares and december 2017 and
has been recognised as a deduction from shareholders’ funds in the statement of changes in equity
annual report and accounts 2008     78
telford ra  24608  1757  page 79 notes to the financial statements 31st march 2008
18 commitments and contingent liabilities
commitments
at 31st march the company had outstanding commitments for future minimum lease payments under
noncancellable operating leases which fall due as follows
property leases                        other leases
2008 2007 2008 2007
£000 £000 £000 £000
within one year 184 161 201 128
between one and five years 737 737 320 82
over five years 476 660  
1397 1558 521 210
operating lease payments represent rentals payable by the company for its office premises and motor vehicles
contingent liabilities
on 23rd august 2005 the company entered an agreement to purchase the site of the former halls of
residence of queen mary and westfield college in south woodford at 31st march 2008 £139 million
2007  £100 million had been paid for the site and a further liability of £73 million 2007  £14 million
has been accrued further payments are contingent on future sales at the development and are estimated
to be approximately £14 million 2007  £23 million
19 related party transactions
the board and certain members of senior management are related parties within the definition of ias 24
related party disclosures 
in july 2006 david holland purchased an apartment from the company at the onestratford development
subsequently contracts were exchanged on 11th december 2006 for a parking space at the same
development the combined purchase price was £262500 the company has received deposits to the value
of £26250 with the balance due on legal completion which is scheduled for 2009 the purchase was
approved at a previous extraordinary general meeting
79     annual report and accounts 2008
telford ra  24608  1757  page 80 20 financial instruments
categories of financial assets and financial liabilities are as follows
31st march 2008 31st march 2007
£000 £000
financial assets
loans and receivables
trade receivables 43 81
other receivables 1878 1479
cash and cash equivalents 4698 17617
6619 19177
financial liabilities
amortised cost
trade payables 8126 5555
land creditors 13696 1422
borrowings 101424 73210
hire purchase liabilities 101 209
123347 80396
the company does not enter into any derivative transactions and has no exposure to exchange rate
movements as its trade takes place entirely within the united kingdom
trade and other receivables trade payables and hire purchase liabilities
the fair value of trade and other receivables trade payables and hire purchase liabilities at 31st march
2008 is equal to the carrying value stated in the balance sheet at that date hire purchase liabilities
include £18000 2007  £96000 due after more than one year all other trade and other receivables 
and trade payables are due within one year
land creditors
land purchases made on deferred payment terms are recorded at fair value using the effective interest
method in accordance with ias 39 financial instruments the difference between the fair value and
nominal value is amortised over the deferment period as financing costs increasing the land creditor to its
full cash settlement value on the payment date the interest rate used in the year to 31st march 2008 was
6 2007  6 all land creditors are due within one year
annual report and accounts 2008     80
telford ra  24608  1757  page 81 notes to the financial statements 31st march 2008
20 financial instruments continued
borrowings
the company uses loan finance all of which is denominated in sterling to acquire development land and
undertake site construction existing loans and loan facilities are in place with three banks and are secured by a
debenture over the assets of the company and by charges over the development sites owned by the company
at 31st march 2008 the company had unutilised overdraft facilities of £30 million 2007  £25 million
the company has a revolving loan facility with allied irish bank of £400 million in respect of certain
development sites interest is charged at base rate plus a margin which varies between 15 and 225
depending on the nature of individual sites and the relationship between base rate and libor at
31st march 2008 the company had utilised £248 million of this facility leaving an unutilised balance of 
£152 million this facility is due for review in april 2009
in addition the company’s jointly controlled entity bishopsgate apartments llp has a credit facility with
allied irish bank of £200 million in respect of the purchase of development land in bethnal green road
interest is charged at libor plus 125 at 31st march 2008 bishopsgate apartments llp had utilised 
£190 million of this facility leaving an unutilised balance of £10 million the company has recorded its
50 share of the loan in its balance sheet at 31st march 2008 this facility expires in january 2009 and an
increased development land and construction facility is currently being negotiated following receipt of
planning permission in march 2008 
the company has site specific loan facilities with the royal bank of scotland of £843 million interest is
charged at base rate plus a margin which varies between 15 and 175 depending on the nature of
individual sites at 31st march 2008 the company had utilised £516 million of these facilities leaving an
unutilised balance of £327 million facilities are repayable on the completion of each development
directly from the sales proceeds received of the utilised loans of £516 million a total of £285 million is
due for repayment within one year £218 million is due for repayment after more than one year and less
than two years and £13 million is due for repayment after more than two years and less than five years
in addition the company’s jointly controlled entity telford homes creekside limited has a credit facility
with the royal bank of scotland of £513 million in respect of the purchase of development land and
construction in greenwich interest is charged at base plus 125 on the land facility and base plus 15
on the construction facility at 31st march 2008 telford homes creekside limited had utilised 
£138 million of this facility leaving an unutilised balance of £375 million the company has recorded its
50 share of the loan in its balance sheet at 31st march 2008 this facility is due for repayment in 2011
telford homes creekside limited has entered into a bill of exchange for £65 million in respect of
deferred land payments due in july 2009 this bill of exchange attracts finance charges and as such has
been classified as bank loans within the accounts of telford homes creekside limited the company has
recorded its 50 share of the bill of exchange in its balance sheet at 31st march 2008
the company has site specific loan facilities with barclays bank of £126 million interest is charged at base
rate plus 15 at 31st march 2008 the company had utilised £54 million of these facilities leaving an
unutilised balance of £72 million these facilities are due for repayment during 2010
81     annual report and accounts 2008
telford ra  24608  1757  page 82 market risk
the company is exposed to the financial risk of changes in interest rates both in terms of changes in the
base rate and libor and in terms of individual banks attitude to market risk and their application of
either base rate or libor to new facilities and the margin applied to each new facility
in order to assess the risk interest costs are forecast on a monthly basis over a five year period using
estimates of likely changes in rates and actual costs are compared to this forecast volatility of interest
costs remained at an acceptable level in the year ended 31st march 2008 interest on all facilities currently
held is charged at floating interest rates and the company assesses the requirement for fixing interest
rates on a regular basis
the effect on the income statement of a 1 rise and a 1 fall in interest rates has been calculated to
assess interest rate sensitivity based on average monthly borrowings in the year a 1 rise in interest rates
would have a negative effect of £988000 before tax 2007  £558000 a 1 fall in interest rates gives the
same but opposite effect
credit risk
credit risk is the risk of financial loss where counterparties are not able to meet their obligations
trade and other receivables include amounts recoverable on contracts from individual purchasers where
title to each property does not pass until the outstanding balance of the purchase price has been paid
deposits already received can be retained by the company the company therefore considers that
adequate security is held against each individual balance
trade and other receivables also include amounts receivable from housing associations and jointly
controlled entities and the company considers the credit quality of the various debtors to be good in
respect of the amounts outstanding and therefore credit risk is considered to be low
surplus cash is held in secure bank deposit accounts with banks that have high credit ratings as set by
international credit rating agencies
liquidity risk
liquidity risk is the risk that the company does not have sufficient financial resources to meet its
obligations as they fall due
the company manages liquidity risk by continuously monitoring forecast and actual cash flows over a five
year period and performing sensitivity analysis on these forecasts the company utilises bank loan facilities
to ensure that adequate funding is available to cover working capital requirements
the company considers that current unutilised facilities are sufficient to cover funding requirements in the
foreseeable future
annual report and accounts 2008     82
telford ra  24608  1757  page 83 notes to the financial statements 31st march 2008
20 financial instruments continued
the maturity profile of financial liabilities is as follows
trade land borrowings net hire total
payables creditors purchase
liabilities
£000 £000 £000 £000 £000
within one year 8126 13696 38042 83 59947
more than one year and   49816 18 49834
less than two years
more than two years and   13566  13566
less than five years
31st march 2008 8126 13696 101424 101 123347
trade land borrowings net hire total
payables creditors purchase
liabilities
£000 £000 £000 £000 £000
within one year 5555 1422 20302 113 27392
more than one year and   42264 78 42342
less than two years
more than two years and   10644 18 10662
less than five years
31st march 2007 5555 1422 73210 209 80396
83     annual report and accounts 2008
telford ra  24608  1757  page 84 21 transition to international financial reporting standards ifrs
as stated in the statement of accounting policies these are the companys first financial statements
prepared in accordance with ifrs as adopted by the eu 
the accounting policies set out in the statement of accounting policies have been applied in preparing the
financial statements for the year ended 31st march 2008 the comparative information presented in these
financial statements for the year ended 31st march 2007 and in the preparation of the opening ifrs
balance sheet at 1st april 2006 the date of transition in preparing the ifrs opening balance sheet the
company has restated the figures previously reported in accordance with uk gaap
an explanation of each ifrs that has resulted in a restatement of the figures prepared under uk gaap is
given below this is followed by reconciliations between uk gaap and ifrs covering the income
statement and balance sheet for the year ended 31st march 2007 and the balance sheet at 31st march
2006 there is no impact on the companys cash flows 
ias 12 income taxes
ias 12 requires that the expected value of future tax deductions relating to the exercise of share options
is recognised as a deferred tax asset over the vesting period of the options under uk gaap deferred tax
was recognised only to the extent that a charge for sharebased payments was recorded in the profit and
loss account under ias 12 any deferred tax over and above that on the sharebased payment charge is
recognised directly in equity under ias 12 other charges and tax credits in respect of employee share
schemes are taken directly to equity rather than adjusting the tax charge in the year
adoption of ias 12 results in an additional deferred tax asset of £324000 at 31st march 2006 and £297000
at 31st march 2007 the movement in this additional asset is recognised partly through the income
statement and partly directly in equity depending on the calculation of sharebased payment charges
the tax charge in the income statement for the year ended 31st march 2007 has increased by £308000 as 
a result of net tax credits recognised in respect of employee share schemes being taken directly to equity 
ias 39 financial instruments  recognition and measurement
ias 39 requires that financial assets and liabilities are recognised initially at their fair value for land
purchased on extended payment terms the company will initially record it at its fair value with a land
creditor recorded for any outstanding monies based on this fair value assessment previously land
purchased on extended payment terms was recognised at the cost determined in the purchase contract
the difference between the ultimate cost of the land and the initial fair value will be amortised over the
period of the extended payment term and charged to finance costs increasing the value of the land
creditor such that at the date of maturity the land creditor equals the payment required      
under uk gaap the balance sheet at 31st march 2007 included a liability of £14 million in relation to
land purchased at queen marys gate south woodford on extended payment terms adjusting this to
fair value has reduced the liability by £73000 and reduced inventories by the same amount the interest
charge in the year to 31st march 2007 has increased by £5000 as a result of amortising the difference
between the ultimate cost of the land and the fair value over the period of the extended payment term
in addition the recognition of profit at the development has changed to reflect the reduction in the
recognised cost of the land resulting in a reduction in revenue of £24000 and a reduction in trade
receivables of the same amount and a reduction in cost of sales of £39000 and a reduction in inventories
of the same amount no restatement was required to the opening balance sheet at 1st april 2006
annual report and accounts 2008     84
telford ra  24608  1757  page 85 notes to the financial statements 31st march 2008
85     annual report and accounts 2008
21 transition to international financial reporting standards ifrs continued
ifrs income statement reconciliation for the year ended 31st march 2007
previously ias 12 ias 39 effect of restated 
reported income financial transition under 
under uk gaap taxes instruments to ifrs ifrs
£000 £000 £000 £000 £000
revenue 104407  24 24 104383
cost of sales 81040  39 39 81001
gross profit 23367  15 15 23382
administrative expenses 6676    6676
operating profit 16691  15 15 16706
finance income 794    794
finance costs 3980  5 5 3985
profit before income tax 13505  10 10 13515
income tax expense 3557 308    308 3865
profit from continuing 9948 308 10 298 9650
operations after tax
telford ra  24608  1757  page 86 annual report and accounts 2008     86
ifrs balance sheet reconciliation as at 31st march 2007
previously ias 12 ias 39 effect of restated 
reported income financial transition under 
under uk gaap taxes instruments to ifrs ifrs
£000 £000 £000 £000 £000
non current assets
property plant and equipment 851    851
deferred income tax assets  226  226 226
851 226  226 1077
current assets
inventories 70174  39 39 70135
trade and other receivables 56128  24 24 56104
cash and cash equivalents 17617    17617
143919  63 63 143856
total assets 144770 226 63 163 144933
non current liabilities
deferred income tax liabilities 71 71  71  
hire purchase liabilities 96    96
167 71  71 96
current liabilities
trade and other payables 15101  73 73 15028
current income tax liabilities 1655    1655
borrowings 73210    73210
hire purchase liabilities 113    113
90079  73 73 90006
total liabilities 90246 71 73 144 90102
net assets 54524 297 10 307 54831
capital and reserves
issued share capital 3694    3694
share premium 28641    28641
retained earnings 22189 297 10 307 22496
total equity 54524 297 10 307 54831
telford ra  24608  1757  page 87 87     annual report and accounts 2008
notes to the financial statements 31st march 2008
21 transition to international financial reporting standards ifrs continued
ifrs balance sheet reconciliation as at 31st march 2006
previously ias 12 ias 39 effect of restated 
reported income financial transition under 
under uk gaap taxes instruments to ifrs ifrs
£000 £000 £000 £000 £000
non current assets
property plant and equipment 871    871
deferred income tax assets    188  188 188
871 188  188 1059
current assets
inventories 45547    45547
trade and other receivables 59454    59454
cash and cash equivalents 7211    7211
112212    112212
total assets 113083 188  188 113271
non current liabilities
deferred income tax liabilities 136 136  136  
hire purchase liabilities 75    75
211 136  136 75
current liabilities
trade and other payables 10073    10073
current income tax liabilities 1590    1590
borrowings 68953    68953
hire purchase liabilities 95    95
80711    80711
total liabilities 80922 136  136 80786
net assets 32161 324  324 32485
capital and reserves
issued share capital 2981    2981
share premium 12656    12656
retained earnings 16524 324  324 16848
total equity 32161 324  324 32485
telford ra  24608  1757  page 88 wa n s t e a d
flat s
hospital 
hill wood
w a l thamstow
marshes
epping forest
buckhirst
hill
 blac k hor s e l ane b179                              bluet road
m11
m11
m11
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                r o m f o r d r o a d
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w h i t e h a l l r o a d
w o o d f o r d r d  
     h i g h r o a d
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c h i n g f o r d l a n e
london
city 
airport
river thames
r o ya l a l b e r t w ay
  a l b e r t way
a 2 0 5   j o h n w i l s o n s t r e e t         a c a d e m y r o a d
 
finsbur y
pa r k
w a nstead
golf
course
t h a
woolwich fe rry
m e s
fl o o d
b a r r i e r
river lea
west
reservoir
east
reservoir
bridge
farringdon rd farringdon st
waterloo rd
g r o v e l o r d s h i p r d
shooter s hi l l r oa d a 2
rochester way relief rd
hackney hackney
shoreditch shoreditch
southwark southwark
lewisham lewisham
wanstead wanstead
chingford chingford
edmonton edmonton
tottenham tottenham
harringay harringay
stoke stoke
newington newington
stamford stamford
hill hill
tottenham tottenham
hale hale
higham higham
hill hill
loughton
chigwell chigwell
woodford woodford
woodford woodford
bridge bridge
woodford woodford
green green
greenwich greenwich
stepney stepney
bow bow
stratford s t r a t f o r d
leyton leyton
west ham west ham
beckton beckton
reservoirs
river lea navigation
high road            leyton                       high rd
canary c a n a r y
wharf w h a r f
e13
e15
e3
e11
n16
n15
n13
n9
n17
n18
e4
ig9
ig7
ig6
ig5
ig8
e18
ig4
ig11
e6
e16
n5
n1
e2
e2
e1
ec1
ec4
ec3
e14
city of c i t y o f
london l o n d o n
se10
se7
se16
se8
se1
se11
se17
se15
ec2
e5
e9
e7
e10
e17
hackney hackney
newham newham
tower hamlets tower hamlets
southwark southwark
lewisham lewisham
greenwich greenwich
waltham  forest waltham  forest
enfield
ilford ilford
barking barking
docklands docklands
islington islington
dlr
dlr
dlr dlr
queen mary’s gate
south woodford
chepstow
market place
romford
bethnal green rd
stadthaus
lesney
greenwich creekside
stadia
decorum
vellum
kinetica
queens road
lanrick road
metro east
casa
st anne’s row
st george’s
queens row
sobow
icona
b a r k i n g ro a d a 1 2 4
e a s t  i n d i a  d o c k  a 1 3 s i l verto w n w ay a 1 0 2 0  
m a n o r  r o a d a 1 0 1 1
c a m b e r w e l l n e w r o a d a 2 0 2                                                                          queens road a202
lewisham way a20
n e w k e n t r o a d a 2 0 1                          o l d k e n t r o a d a 2
c a r p e n t e r ’ s r o a d a 1 1 5
       a12                                a12                          a12
b l a c k f r i a r s r o a d a 2 0 1
e a s t s m i t h f i e l d    t h e h i g h w ay a 1 2 0 upper thames street a321
                        a 5 0 3                           s e v e n   s i s t e r s   r o a d   a 5 0 3
g r e e n   s t r e e t   b 1 6 7
blackhorse road        
       markhouse    road    a1006                      church    road      a1006
walthamstow walthamstow
b u s h r o a d a 1 1 4
hoe street                      a112 
 a m h u s t   p a r k   a 1 0 7
lord   park   nannor   road   b105
old street a5201
 clerkenwell road      old street a5201
e s s e x r o a d a 1 0 4
c i t y r o a d a 5 0 1
u p p e r s t r e e t a 1
g r o v e r o a d a 1 2 0 5
hommerton road b112
  a s p e n   w a y   a 1 2 6 1
s a l t e r r o a d b 2 0 5
r e d r i f f r o a d a 2 0 2
lower road a200
commercial s t reet
b e t h n a l g r e e n a 1 2 0 9
r o t h e r h i t h e n e w r o a d a 2 2 0 2
a b b y s t r e e t b 2 0 2
w a l w o r t h r o a d a 2 1 5
s o u t h w a r k s t a 3 2 0 0
bishops gate shoreditc h high street
w h i t e c h a p e l r o a d a 1 1                  m i l e e n d r o a d a 1 1
     lea      bridge      road       a104                                                               lea    bridge    road    a104
s t  p a u l’ s r d a 1 1 9 9
 u p t o n  l a n e     a 1 1 4
centre road      woodford road       woodgrange road
greenwich high road   a206
dlr
g r e e n l a n e s a 1 0 5
g r e e n   l a n e s   a 1 0 5
a206                                         woolwich road a206
a 4 0 6 
 
 
 
  
a 4 0 6  
  
 
a 4 0 6 
 
 
 
 
a 4 0 6     
        a 4 0 6  
 
 a 4 0 6 
dalston lane
cutty
sark
the o2
leytonstone high road                                    leytonstone high road
onestratford
merchants’ quarter
development guide 2008
annual report and accounts 2008     88
current and future developments showing proximity to three key areas of growth
and employment  the city canary wharf and stratford
telford ra  24608  1758  page 89 telford homes plc
first floor stuart house
queensgate britannia road
waltham cross herts en8 7tf
tel 01992 809800
fax 01992 809801
wwwtelfordhomesplcuk
telford ra  24608  1758  page 90


Summary:
 chief executive’s review
“an excellent performance
in the first six months of
the year continued into
the second half despite
increasingly difficult market
conditions revenue has
grown by 54 to £1604
million and profit before tax
is up 31 to £177 million”
andrew wiseman
chief executive
this has been achieved as a result of the
strength of the telford homes brand
incorporating realistic pricing and consistent
delivery together with strong marketing
concepts which have allowed the company to
continue selling homes to the investor market
at an early stage in the development process 
property sales and affordable housing
contracts were exchanged on 523 open
market private homes 502 affordable
homes and ten commercial units making
a total of 1035 properties in the year
included within this number are 230 homes
being constructed under joint ventures
where we recognise half of the revenue
and profit from the development 
where the market allows we maintain
our policy of derisking the business by
contracting sales before much of the
development work on each site has taken
place this secures future cash flows and has
led to extended bank finance on a number
of developments where the volume of sales
offsets the risk of increased gearing in total
we had 2051 properties under construction at
31st march 2008 of which 73 were secured
by contracts exchanged 
the number of open market private homes
sold has increased by 9 this year with
the average selling price of those homes
increasing to £264000 from £258000
successful sales launches during the year
include the sale of all 161 open market
homes at merchants’ quarter on the british
estate e3 stadthaus n1 where all 19 open
market homes were sold in november 2007
vellum in walthamstow where contracts
have been exchanged on 24 of 66 open
market homes and kinetica e8 where 25 of
41 have been secured vellum and kinetica
were launched in the first few months of
2008 and reservations are still being taken
at these developments handovers of the
completed homes will take place in 2010
by which time our investors anticipate that
the market will have recovered
in contrast expected handover dates for the first
and second phases at queen mary’s gate 
in south woodford are all during 2008 
this development has been the company’s
09     annual report and accounts 2008
telford ra  24608  1754  page 10 business  financial review
annual report and accounts 2008     10
queen mary’s gate
south woodford e18
telford ra  24608  1754  page 11 icona stratford e15
telford ra  24608  1754  page 12 business  financial review
most significant sales outlet during the year
with properties largely for the owneroccupier
market the first phase is 93 sold with 172
out of 184 open market homes secured and
over 150 legally completed and occupied
the second phase is due to be completed
in november 2008 and contracts have been
exchanged on 18 of 93 open market
homes with a further one reserved 
whilst properties for the owneroccupier
market are less likely to sell at an early
stage the rate of sale has significantly
slowed at queen mary’s gate without
improvement in the current market
conditions we expect to be carrying a
number of completed homes for sale
on this development into 2009 and the
company is budgeting on this basis 
the number of affordable homes sold has
increased to 502 from 84 last year partly
reflecting the timing of some significant
contracts partnerships with affordable
housing providers remain integral to
our business and typically 35 of any
development is sold for affordable housing 
these partnerships are even more
significant in the current climate and
we will continue to be active in seeking
opportunities where an increased level
of affordable housing reduces the open
market risk in a development 
our development at papermill place in
walthamstow incorporates 175 homes being
constructed for east thames housing group
for £193 million as well as 66 open market
homes being marketed as vellum this mix of
homes improves the return on equity from
the development and secures cash inflows
over the course of construction in return for
a lower anticipated margin in total at 
31st march 2008 amounts due under
affordable housing contracts over the next
few years were in excess of £60 million 
completions
consumer confidence in the national
housing market has been hit in recent
months by the reduced availability and
higher cost of mortgage finance
restrictions on mortgage finance make
the process of legally completing finished
properties more protracted 
telford homes is communicating with
each purchaser to ensure their financial
arrangements have been instigated at an
early enough stage to meet our completion
dates in addition we have been in dialogue
with some of the major lenders and valuers
to maximise confidence through
transparency of information the 
telford homes approach to sales is based 
on net prices agreed at the point of sale 
with no undisclosed discounts or incentives
distorting true valuations 
in the last six months we have legally
completed more than 300 open market
homes at icona in stratford and 
queen mary’s gate with a quarter of these
in the past eight weeks although some have
taken slightly longer than usual to complete
there have only been a few serious issues on
two occasions we rescinded contracts with
the buyer and retained the 10 deposit one
of these properties was immediately resold
and completed the other was rescinded in
april 2008 and is expected to be resold at no
less than the original purchase price 
despite the problems in the mortgage
market our performance on completions
to date coupled with our early dialogue
with customers due to complete later in
2008 means that we remain confident that
the projected cash inflows from exchanged
properties will be realised 
annual report and accounts 2008     12
telford ra  24608  1754  page 13 site acquisitions
the company has reduced its investment
in the development pipeline over the last
few months in response to a climate of
continuing uncertainty in the housing
market and the economy protection of
cash has become our immediate priority
and we are therefore appraising sites
which have lower upfront net equity
requirements including joint ventures and
partnerships with housing associations 
our most recent acquisition is a parcel of
five sites in southwark in partnership with
family mosaic housing association which
are expected to deliver over 100 new
homes there are no initial land payments
from telford homes and the expected
proceeds will be shared with family mosaic
under the terms of the agreement three
of the sites are already under construction
and the other two are subject to receipt of
full planning permission 
planning
the planning process remains a significant
barrier to the efficient delivery of new homes
in london we retain a competitive advantage
through our knowledge of the local planning
environment in east london and this puts us
in a strong position during the year we have
had a number of successes including full
planning permission for the 371 homes at
greenwich creekside our joint venture with
the royal bank of scotland and for 360
homes in bethnal green road our joint
venture with genesis housing group 
increasing bureaucracy and the need to satisfy
several different bodies with competing views
have led to delays in the development of
some sites which are expected to be under
construction during 2008 two of our
developments await appeal decisions which if
allowed will mean work can commence later
this year overall the number of units in the
development pipeline that are subject to the
planning process has reduced to 25 of the
total pipeline from 42 last year 
chief executive’s review
13     annual report and accounts 2008
cosmopolitan apartments
enfield
telford ra  24608  1755  page 14 business  financial review
development pipeline and partnerships
our development pipeline being properties
that will produce profit in future years
excluding those built for joint venture
partners consists of 1388 properties with
planning permission and 454 subject to the
planning process this is a total of 1842
properties which are expected to provide
turnover in excess of £430 million and
gross profit of over £80 million 
although we have reduced our investment
in new land we have retained financial
resources to deploy in our partnerships
with eastend homes and poplar harca
these housing transfer organisations are
both significant land owners in east
london and have chosen telford homes
to be their partner on a number of large
regeneration schemes 
following the success of our partnership with
eastend homes on the british estate e3 we
have now submitted plans for the st george’s
estate e1 and we continue to progress master
plans for the regeneration of five other
estates the british estate has set the model
for this partnership with land payments made
by telford homes being reinvested into the
third party refurbishment of existing homes
on the estate in total the partnership with
eastend homes is expected to add in excess of
1000 properties to the development pipeline
and the partnership with poplar harca is
expected to add over 400 properties 
in further recognition of our contribution
to the supply of affordable housing we
were chosen as a prequalified partner
of the housing corporation during 2007
this enables the company to bid directly for
grant funding and gives us greater influence
in the provision of new affordable housing 
annual report and accounts 2008     14
computer
generated image of
bethnal green road e1
telford ra  24608  1755  page 15 chief executive’s review
15     annual report and accounts 2008
operating performance
the operational output of the business
continues to grow and we have over 3000
properties either in the planning process in
detailed design or under construction there
are now three operating divisions managing
delivery following the formation of strada
earlier this year to join alto and metro in
many ways it is business as usual in the
operational management of the development
pipeline and it will remain so if we continue
to be successful in selling our homes at an
early stage in the development process 
health and safety remains at the forefront
of our business and we have continued to
develop and monitor our policies and
procedures during the year 
people
staff numbers have risen in the last 12
months to manage increasing activity
we will maintain and expand this
infrastructure to deliver our properties
whilst we are able to secure the cash
inflows from their development every
employee contributes to the excellent
reputation of telford homes and i thank
each of them for their efforts this year in
producing another set of record results 
computer generated
image of stadthaus n1
telford ra  24608  1755  page 16 business  financial review
annual report and accounts 2008     16
computer generated
images of kinetica e8
current trading and outlook
the reduced availability of mortgage
finance is continuing to weaken confidence
in the national housing market which makes
it more difficult to secure individual sales
even in london traditionally the most
resilient region our developments with
completion dates 12 months or more into
the future continue to attract buyers’
interest confirming long term confidence
queen mary’s gate still with availability
and completing later in 2008 has seen a
significant slowdown in sales in the past
few months due to short term concerns 
we will time sales launches at greenwich
creekside and bethnal green road to get
the best results in light of prevailing market
conditions both of these developments are
due for completion in 2011 reflecting our
high percentage of presales at 31st march
2008 we have made only a handful of sales
since the end of the year with no new
launches and relatively little marketing
activity taking place during this period 
recent figures from the department for
communities and local government show
that the supply of new homes is not going
to meet current government targets in the
short term new housing starts for the three
months to march 2008 were 32100 against
an annual target of 240000 ongoing tighter
terms for mortgage finance will further
restrict new starts as developers will not
construct properties that cannot be sold
the imbalance between the supply of new
homes and the need for somewhere to live is
increasingly evident and the rental market in
east london is growing steadily as a result 
the company is in a strong position both
to withstand the current market and to
benefit once conditions begin to improve
our strategy in previous years of preselling 
is now paying off and as at 31st march 2008
revenue secured but not yet recognised was
£125 million up from £91 million at the
same time last year 
we are cautious in our approach to the new
financial year but the need for new housing
in east london together with an ongoing
programme of regeneration our brand’s
reputation and our beneficial partnerships
with affordable housing providers gives me
confidence that the medium to longer term
outlook for telford homes remains positive 
andrew wiseman
chief executive
27th may 2008
telford ra  24608  1755  page 17