2003
annual report and accounts annual report and accounts 2003
contents
financial highlights 1
chairman’s statement 2
chief executive’s review 4
financial review 10
directors and advisors 12
policy on corporate governance 14
directors’ remuneration report 16
report of the directors 18
statement of directors’ responsibilities 20
auditors’ report 21
profit and loss account 22
balance sheet 23
cash flow statement 24
statement of accounting policies 25
notes to the financial statements 27
development guide 37 1
financial highlights
31st march 2003
£253m
£88m
510 15 20 25
12 3 4 5
31st march 2002
£43m
£13m
3p
1p
127p
101p
31st march 2003
406
344
31st march 2002
204
182
turnover
profit before tax
dividend per share
earnings per share
pretax return on
average equity
pretax return on
average total capital
annual report and accounts 2003
12 3
123456789 10 11 12 13 14
510 152025 30 354045
510 152025 30 354045
31st march 2003
31st march 2003
31st march 2003
31st march 2002
31st march 2002
31st march 2003
31st march 2002
31st march 2002 2
chairman’s statement
david holland chairman nonexecutive i am pleased to be reporting on another
successful year for telford homes the
company has achieved exceptional results
once again and we are continuing to
build a good reputation particularly in
and around east london 
we are making a significant contribution
to the regeneration of the area
surrounding docklands and the city
with average selling prices below
£250000 and the increasing attraction
of living close to major employment
areas demand for our product continues
to be strong
relationships with public sector housing
providers are crucial to our business and
we have continued to develop these during
the year we firmly believe that these
relationships will prove very successful
both for our partners and for telford
homes in the future and we place great
value on them  
at the end of the financial year our
business employed 48 people more
than double the number at our previous
year end this increase includes the
strengthening of our management
team both at board level and senior
management as well as the appointment
of staff throughout the business i would
like to take this opportunity to thank
each and every one of our employees for
their contribution to the company this
year our success is clear evidence of
their efforts  
we have a number of exciting new
developments to build and sell in 2003
and 2004 which will contribute to another
year of growth for the company
david holland
chairman
annual report and accounts 2003
“the company has achieved
exceptional results once again and
we are continuing to build a good
reputation particularly in and
around east london” 3
annual report and accounts 2003
little docklands chelmsford 4
chief executive’s review
andrew wiseman chief executive financial results
i am delighted to report a substantial
performance generating profit before
tax of £43 million in our second period
of trading since incorporation in
december 2000 the growth of telford
homes has been tremendous and
reflects the efforts of everybody who is
involved with the company 
turnover for the year ended 31st march
2003 was £253 million compared with
£88 million in our first 16 month period
of trading to 31st march 2002 earnings
per share for the year were 127p
2002 – 101p and the directors are
proposing a final dividend of 20p per
share making 30p for the year  
over the course of the year we exchanged
contracts on the sale of 112 “openmarket”
private homes at an average selling price
of £214000 in our first 16 month
trading period we exchanged contracts
on 61 “openmarket” homes at an
average price of £210000
increasingly our business involves building
mixed developments during the year
our income was complemented by the
sale of 11 “affordable” homes six small
retail units 6500 square feet of office
space a construction contract to build a
community centre and the sale of a
small development site including those
sales we exchanged contracts on 132 
properties in the year our target for the 
full year set out in the interim statement
announced on 19th november 2002 was
to exchange contracts on 137 properties
however the mix of sales in the year and
our progress on development sites
was such that our performance in
reported turnover and profit before
tax is in excess of our expectations at
that time
our product and the market place
we remain focused on a small
geographical area to the east of the city
of london and the area in and around
docklands in addition we have one
development in chelmsford town centre
we continue to appraise land purchase
opportunities in these as well as wider
areas and we may consider opportunities
that will broaden our geographical
spread but still be within one hour’s
travel from our offices
our product is typically a one or two
bedroom apartment with a bathroom
for each bedroom a loungedining room
an attached and fully fitted kitchen with
breakfast area and a private terrace or
balcony providing outside space floor
coverings of laminated wood in the halls
and living rooms carpets to the bedrooms
and tiling to kitchens and bathrooms are
provided as standard 
annual report and accounts 2003
“our relationships with public
sector housing providers continue
and we look forward to further
involvement with them”
case study
gale street
one of several sites purchased
from poplar harca one of our
public sector housing partners
gale street is part of the ongoing
regeneration of east london
including the creation of attractive
private developments close to
good transport links in areas of
predominantly affordable housing
gale street consists of 11 private
apartments all 11 were sold to
one investment buyer in july 2002
and the development was
completed and handed over in
april 2003 5
annual report and accounts 2003
lansdowne drive e8 blondin street e3
gale street e3 6
chief executive’s review
annual report and accounts 2003
each development would contain a
range of apartment types at varying
prices and would include a number with
exceptional features such as large terraces
double height living rooms duplex
apartments or galleried mezzanine spaces
the majority of our homes have been sold
at an early stage of construction usually
12 months prior to build completion
purchasers have generally been investment
buyers who either sellon or hold the flat
for letting purposes despite signs of a
housing market slowdown for property
priced above £250000 buyers of our
properties continue to be active and
our performance since the year end
supports this statement
development sites and
development partners
during the year we made two substantial
site acquisitions and both sites benefit
from outline planning consents for
residential development 
the first is the site of the former island
gardens dlr station which lies directly
opposite the new dlr station on the
river at the greenwich foot tunnel this
site has a development capacity of more
than 100 residential apartments and was
acquired as a joint venture with asda
property holdings ltd  
the second is a redundant warehouse
accessed from the a13 and bordering
the regents canal at its entrance into the
limehouse basin  
detailed planning consents for these two
sites as well as for our major joint
development with east thames housing
association at abbotts wharf on the
limehouse cut are nearing conclusion
after negotiations with the local planning
authority on design and the provision of
“affordable” housing the length of time
it takes to achieve a satisfactory planning
consent acts as a significant brake to the
supply of new homes in this environment
our relationships with planning authorities
and housing associations have proved
valuable in enabling us to achieve planning
consents and i am delighted to report
that the local authority resolved to grant
planning consent at abbotts wharf for
201 units on 14th may 2003
we have also acquired three smaller sites
in east london including one where we
are providing a community centre beneath
private apartments and another where we
will be working with ujima which will be
a new housing association partner for us
case study
goldsmith’s apartments
this development consists of 35
private apartments and 11
affordable apartments the
affordable apartments have been
purchased by bethnal green and
victoria park housing association
and will provide homes at subsidised
rent and in shared ownership
each of the private apartments has
a west facing balcony overlooking
haggerston park and they are being
sold offplan while construction
proceeds at 31st march 2003
we had exchanged 20 contracts
and since then we have exchanged
contracts on a further 2 apartments
and reserved 9 more subject
to contract
cgi of pelling street apartments 7
annual report and accounts 2003
cgi to show location of the goldsmith’s apartments 
cgi of hawgood street
the provision of attractive apartments
to the private market is increasingly
entwined with the provision of “affordable”
housing and good relationships with
registered social landlords are essential
to us our relationships with east
thames housing association boleyn 
forest ha bethnal green  victoria park
ha and poplar harca continue and we
look forward to further involvement
with them   
we have agreed terms to acquire five
more sites in east london to provide an
additional 133 homes which will bring
our stock of land assuming receipt of
expected detailed planning consents
to 616 units 
our current development capacity will
allow us cautiously to expand the
business and produce further growth
people and systems
the heart of our business is the
management of our construction where
we have a youthful and enthusiastic
management team supported by
experienced site managers controlling
the subcontracted trades this team
has been strengthened in preparation
for the major construction projects at
abbotts wharf and island gardens by
the recruitment of john fitzgerald 
john has excellent experience in
complex residential construction and
will be a key member of the executive
team our design surveying and buying
team at head office are providing a
professional service to construction and
we are therefore able to produce a
high quality and attractive product for
our customers   8
chief executive’s review
annual report and accounts 2003
case study
abbotts wharf
abbotts wharf on the limehouse
cut near bartlett park is being
developed in partnership with east
thames and boleyn  forest housing
associations there will be 201 homes
to provide a range of tenures
including subsidised rent shared
equity and private ownership 
the scheme will include diverting
the towpath around a marina
within the development and past a
waterfront restaurant
the local authority resolved to
grant planning consent on 14th
may 2003
our success relies on the construction
process supported by effective sales and
marketing land buying and finance teams
teamwork is a fundamental strength of
the business and the quality people we
now have in place will help to continue
the development of telford homes as a
successful niche house builder
current trading and outlook
since the year end we have recognised
15 contract exchanges at a combined
value of £31 million and we have sold
subject to contract a further 28 properties
with a value of £53 million
there are several development launches
due in the coming months and interest
for these sites is already very encouraging
we are confident that we will continue
to achieve significant presales and
therefore look forward to another
successful year
andrew wiseman
chief executive 9
annual report and accounts 2003
cgi of abbotts wharf 10
financial review
results for the year
the results for the year ended 31st
march 2003 are excellent and reflect a
period of significant growth and success
for the company telford homes is now
well placed to produce another year of
wellmanaged growth as the business
continues to develop
operating results
turnover has increased to £253 million
compared with £88 million in the first
16 months of trading to 31st march
2002 an analysis of the sales that have
contributed to this almost threefold increase
is given in the chief executive’s review
gross profit has increased to £69 million
from £25 million with a margin achieved
of 272 against 282 in the first period
of trading this fall in the margin reflects
a slowing in the rate of increase in selling
prices over the period and prices are now
static in our market
our operating margin has improved to
196 from 192 overheads have
increased to £19 million in the year to
31st march 2003 a consequence of the
growth in the business and the need to
ensure that we have the right people
and systems in place to manage the
company and build for our future success
interest
interest paid was £07 million compared
with £04 million in our first 16 months
interest rates have remained low over the
course of the year and the majority of our
finance is currently at base rate plus 15
our interest cover is 71 times and we
monitor this to ensure that the company is
not exposed to significant interest risk
arising from future rate changes
our profit before tax is £43 million
increased from £13 million and this
exceptional result is well in excess of our
original expectation for the year
this result enables us to report a
substantial pretax return on average
equity of 406 an increase on last year
of over six percentage points our return
on average total capital has also increased
to 204 from 182 
taxation
the effective tax charge remains
approximately 30
dividends
the company paid an interim dividend of
10p per share in january 2003 a final
dividend of a further 20p is now proposed
making a total for the year of 30p
against a final dividend last year of 10p
annual report and accounts 2003
“telford homes is now well placed to produce
another year of wellmanaged growth as
the business continues to develop” 11
this dividend is covered in excess of four
times by earnings per share the final
dividend is expected to be paid on 11th
july 2003 to ordinary shareholders on the
register on 20th june 2003 
earnings per share
earnings per share increased to 127p
from 101p the weighted average
number of shares in issue increased from
93 million to 236 million 
the company carried out a successful
share placing in july 2002 which raised
£3 million before costs and a further
placing in november 2002 which raised
£05 million despite this the return on
average equity and earnings per share
have grown demonstrating immediate
success in investing the additional capital
to produce continued growth
balance sheet
net assets at 31st march 2003 were
£133 million increased from £77 million
this increase reflects the £22 million of
retained profit for the year and the new
equity invested into the business
our asset base has been expanded and
we now hold total assets of £389 million
increased from £199 million the vast
majority of these assets are represented
by work in progress on many of our sites
and by debtors awaiting legal completion
of the properties we have exchanged to
date we have now finished work on six
developments in total with a further four
due to be completed in the next few weeks
finance
our banks provide 70 of development
land and construction expenditure with
repayments made as completion monies
are received we continue to have
excellent relationships with all of our
banking partners with our primary
bankers allied irish bank providing
finance for the majority of our sites with
total facilities of £18 million the royal
bank of scotland is financing some of
our significant sites with facilities of £30
million including our joint venture
facilities with asda property holdings
ltd heritable bank have also assisted us
in the year with their financing of the
land purchase at abbotts wharf
our combined overdraft facility now
stands at £15 million which gives us
significant shortterm flexibility we are
not currently using this facility
gearing at 31st march 2003 stands at
126 down from 138 last year our
successful policy of preselling has enabled
us to sustain this level of gearing and while
we continue to achieve early sales on key
developments we intend to maximise
shareholder returns by maintaining gearing
at these levels
cash flow
cash flows are carefully monitored and
continuously reassessed to ensure that
the continuing growth of the business can
be financed by a combination of equity
and debt this situation is reported on a
monthly basis to both the board and our
major banking partners
share price
the share price on 31st march 2003
was 760p 31st march 2002 – 605p
with a high in the year of 845p and a
low of 605p
jonathan distefano
financial director    
annual report and accounts 2003 12
directors and advisors
annual report and accounts 2003
secretary and registered office
margaret turner
3 buckingham court rectory lane loughton essex ig10 2qz
registered number
4118370
auditors
moore stephens
st paul’s house warwick lane london ec4p 4bn
bankers
allied irish bank
241 high road ilford essex ig1 1ne
royal bank of scotland
unit 2 wellbrook court girton cambridgeshire cb3 0an
heritable bank
8 hill street berkeley square london w1j 5ng
solicitors corporate
s j berwin
222 gray’s inn road london wc1x 8xf
solicitors property
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
jeremy brett
construction director
mark duffield
technical director
andrew wiseman 
chief executive
david holland 
chairman nonexecutive
jonathan distefano 
financial director
david durant
managing director
sheena ellwood 
sales and marketing
director
james furlong
land director
robert clarke 
nonexecutive director 13
annual report and accounts 2003
gold award winning exhibition stand at the 2003 homebuyer show
steve diggons the aftersales manager at blondin street development 14
policy on corporate governance
annual report and accounts 2003
application of principles
although not formally required to do so the directors have sought to embrace the
principles contained in the combined code the code 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 the board is aware of the higgs report on corporate governance
and will monitor its progress
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 of the board david
holland and robert clarke the nonexecutive directors are independent and they
comprise both the audit and remuneration committees
management information systems are in place to enable the directors to make informed
decisions to properly discharge their duties as the business continues to develop the
composition of the board will be reviewed to ensure that it is 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 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
relations with shareholders
the company has institutional shareholders and is where practicable willing to enter
into a dialogue with them 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 15
annual report and accounts 2003
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 eliminate the risk of failure to achieve
business objectives and can only provide reasonable and 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 2003 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 monthly
progress on site developments is formally monitored by the board
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
during the period the audit committee has reviewed the annual accounts and has met
twice the external auditors being in attendance the duties of the committee 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
going concern
the directors consider that the funds available to the company are sufficient for its
operation for the foreseeable future 16
directors’ remuneration report
annual report and accounts 2003
the directors present the remuneration report for the year ended 31st march 2003
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 further scheme for
executive directors both schemes are dependent on the company meeting certain
financial performance targets
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 3
months notice
directors’ emoluments
the directors’ emoluments for the year ended 31st march 2003 are shown in 
table 1 opposite
the salary for mark duffield includes a one off payment upon commencement of
employment with the company of £20000 this payment was approved by the
remuneration committee
the emoluments for mark duffield sheena ellwood and jonathan distefano are
shown from their respective dates of appointment
directors’ share options
the share options held by the directors at 31st march 2003 and the movements
during the year then ended were as shown in table 2 opposite
options were granted to mark duffield on 5th march 2002 to jonathan distefano
on 1st october 2002 and to sheena ellwood on 20th february 2003
on 3rd september 2002 300000 shares were issued as a result of jeremy brett
exercising share options at an exercise price of 10p on that date the market value of
the shares was 77p
by order of the board
david holland
chairman of the remuneration committee
16th may 2003 17
annual report and accounts 2003
salary bonus benefits pension total total
and fees in kind contributions 2003 2002
£££ £ £ £
andrew wiseman 67500 29300 17716 7106 121622 97380
david durant 67500 29300 14518 7106 118424 99241
jeremy brett 51875 27400 6417 5167 90859 69071
robert clarke 16875    16875 6250
jonathan distefano 13750 10000 516 1375 25641 
mark duffield 73125 27500 12108 5312 118045 
sheena ellwood 16875 10000 422 1500 28797 
james furlong 43750 26400 29672  99822 29423
david holland 21875    21875 8333
total 373125 159900 81369 27566 641960 309698
table 1  directors’ emoluments
company 31st march granted exercised 31st march exercise dates normally
scheme 2002 in year 2003 price exercisable
number number number number
jeremy brett other 300000  300000  10p at any time
robert clarke unapproved 50000   50000 50p 5 dec 2004 to 5 dec 2011
jonathan distefano approved  40000  40000 75p 1 oct 2005 to 1 oct 2012
unapproved  60000  60000 75p 1 oct 2005 to 1 oct 2012
mark duffield approved  49586  49586 605p 5 mar 2005 to 5 mar 2012
unapproved  50414  50414 605p 5 mar 2005 to 5 mar 2012
sheena ellwood approved  40268  40268 745p 20 feb 2006 to 20 feb 2013
unapproved  59732  59732 745p 20 feb 2006 to 20 feb 2013
table 2  directors’ share options 18
report of the directors 
annual report and accounts 2003
the directors present their report and the audited financial statements for the year
ended 31st march 2003
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 2 to 11
results and dividends
profit after taxation for the year to 31st march 2003 was £2990000 2002  £942000
the directors recommend a final dividend of 2p per ordinary share which together
with the interim dividend of 1p paid on 13th january 2003 makes a total of 3p for
the year 2002 – 1p
substantial shareholdings
as at 9th may 2003 the company had been advised of the following notifiable
interests in its ordinary share capital
number percentage
held
funds managed by isis asset management plc 3866667 1536
the puma ii fund
managed by shore capital stockbrokers limited 3343294 1328
k p furlong 2200000 874
fielding nominees limited 1607760 639
d g furlong 1400000 556
m k b turner 1118333 444
directors
details of the directors of the company are shown on page 12
mark duffield was appointed to the board on 5th april 2002 
jonathan distefano and sheena ellwood were appointed to the board on 2nd
january 2003 both retire at the next annual general meeting and being eligible offer
themselves for reelection
andrew wiseman and david durant retire by rotation at the next annual general
meeting and being eligible offer themselves for reelection
margaret turner was appointed as company secretary on 8th august 2002 replacing
andrew wiseman who resigned on the same date 19
annual report and accounts 2003
directors’ interests
the directors serving at 31st march 2003 are shown together with their interest in the
shares of the company at that date
31st march 2003 31st march 2002
andrew wiseman 2541093 2200000
david durant 1000000 1000000
james furlong 1407760 1200000
david holland 1000000 1000000
jeremy brett 350000 50000
robert clarke 40000 40000
mark duffield 12000 
sheena ellwood 10000 
jonathan distefano 6000 
details of share options held by directors are given in the directors’ remuneration 
report on pages 16 and 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 2003 trade creditors represented 15 days purchases 2002 – 11 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
charitable donations
the company made charitable donations of £3400 2002  £nil
auditors
a resolution to reappoint moore stephens as auditors to the company will be
proposed at the annual general meeting in accordance with section 385 of the
companies act 1985
by order of the board
margaret turner
company secretary
16th may 2003 20
statement of directors’ responsibilities
company law requires the directors to prepare financial statements for each financial
period which 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 whether applicable accounting standards have been followed subject to any 
material departures disclosed and explained in the financial statements
• prepare the financial statements on the going concern basis unless it is inappropriate
to presume that the company will continue in business
the directors are responsible for keeping proper accounting records which disclose with
reasonable accuracy at any time the financial position of the company and 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 
annual report and accounts 2003 21
auditors’ report
annual report and accounts 2003
independent auditors’ report to the shareholders of telford homes plc
we have audited the financial statements of telford homes plc for the year ended 31st march 2003 set out on
pages 22 to 35 these financial statements have been prepared under the historical cost convention and the
accounting policies set out on pages 25 and 26
this report is made solely to the company’s members as a body in accordance with section 235 of the companies
act 1985 our audit work has been undertaken so that we might state to the company’s members those matters
we are required to state to them in an auditors’ report and for no other purpose to the fullest extent permitted
by law we do not accept or assume responsibility to anyone other than the company and the company’s members
as a body for our audit work for this report or for the opinions we have formed
respective responsibilities of directors and auditors
as described in the statement of directors’ responsibilities the company’s directors are responsible for the preparation
of the financial statements in accordance with applicable law and united kingdom accounting standards
our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements
and united kingdom auditing standards
we report to you our opinion as to whether the financial statements give a true and fair view and are properly
prepared in accordance with the companies act 1985 we also report to you if in our opinion the report of
the directors is not consistent with the financial statements if 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 transactions with the company is not disclosed
we read other information contained in the annual report and consider whether it is consistent with the
audited financial statements this other information comprises only the chairman’s statement chief
executive’s review financial review report of the directors policy on corporate governance and directors’
remuneration report we consider the implications for our report if we become aware of any apparent
misstatements or material inconsistencies with the financial statements our responsibilities do not extend
to any other information
basis of audit opinion
we conducted our audit in accordance with united kingdom auditing standards 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 of the state of the company’s affairs as at 31st
march 2003 and of its profit for the year then ended and have been properly prepared in accordance with
the companies act 1985
moore stephens
registered auditors and chartered accountants
st paul’s house warwick lane london ec4p 4bn
16th may 2003 22
profit and loss account   31st march 2003
annual report and accounts 2003
note 12 months ended 16 months ended
31st march 2003 31st march 2002
£000 £000 
turnover 25334 8805
cost of sales 18449 6318
gross profit 6885 2487
administrative expenses 1910 798
operating profit 1 4975 1689
interest receivable 22 28
interest payable and similar charges 4 725 386
profit on ordinary activities before taxation 4272 1331
taxation on profit on ordinary activities 5 1282 389
profit on ordinary activities after taxation 2990 942
dividends paid and proposed 6 755 203
retained profit for the period 2235 739
retained profit brought forward 739 
retained profit carried forward 2974 739
earnings per share
basic 7 1267p 1010p
diluted 7 1258p 999p
the company has no recognised gains and losses other than those included in the profit and loss account
all activities are in respect of continuing operations 23
balance sheet   31st march 2003
annual report and accounts 2003
note 31st march 2003 31st march 2002
£000 £000
fixed assets
tangible assets 8 681 279
current assets
stocks and work in progress 9 19810 13107
debtors 10 18152 6476
cash at bank and in hand 239 44
38201 19627
creditors  amounts falling due within one year 11 25427 12058
net current assets 12774 7569
total assets less current liabilities 13455 7848
creditors  amounts falling due after more than one year 12 109 109
provision for liabilities and charges 13 4 4
net assets 13342 7735
financed by
capital and reserves
called up share capital 14 2518 2025
share premium 15 7850 4971
profit and loss account 15 2974 739
equity shareholders’ funds 16 13342 7735
these financial statements were approved by the board on 16th may 2003 and signed on its behalf by
andrew wiseman jonathan distefano
chief executive financial director 24
cash flow statement   31st march 2003
annual report and accounts 2003
note 12 months ended 16 months ended
31st march 2003 31st march 2002
£000 £000
cash outflow from operating activities 19 7052 17045
returns on investments and servicing of finance
interest received 22 28
interest paid 713 380
hire purchase interest 12 6
703 358
taxation 382 
capital expenditure
purchase of tangible fixed assets 404 80
sale of tangible fixed assets 12 
equity dividends paid 454 
cash outflow before financing 8983 17483
financing
issue of ordinary share capital 3530 7305
expenses of share issue 158 309
increase in bank loans 6350 10220
issue of subordinated loan  2200
repayment of subordinated loan  2200
capital element of hire purchase payments 139 94
9583 17122
increase decrease in cash 600 361
reconciliation of net cash flow to movement in net debt
increase decrease in cash 600 361
increase in bank loans 6350 10220
capital element of hire purchase payments 139 94
increase in debt arising from cash flow 5611 10487
inception of hire purchase agreements 177 276
movement in net debt in the period 5788 10763
net debt brought forward 10763 
net debt carried forward 20 16551 10763 25
statement of accounting policies  31st march 2003
annual report and accounts 2003
the principal accounting policies are summarised below they have all been applied consistently throughout the
year and the preceding period
accounting convention
the financial statements have been prepared under the historical cost convention and in accordance with
applicable accounting standards
turnover and profit recognition
turnover 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 turnover less deposits and completion
monies received is included as amounts recoverable on contracts within debtors all turnover is generated in
the united kingdom
profit on developments is recognised over the life of each contract in proportion to turnover 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
joint arrangements
the company has certain contractual arrangements with other participants to engage in joint activities that do
not create an entity carrying on a trade or business of its own the company includes its share of the assets
liabilities profits and cash flows in such joint arrangements measured in accordance with the terms of the
arrangement and prorata to the company’s interest in the arrangement in its financial statements
at 31st march 2003 the company held 50 of the issued share capital of island gardens limited a company
registered in england and wales which has been incorporated to assist the company in carrying out a joint activity
development properties
development properties are stated at the lower of cost and net realisable value cost comprises costs of
acquisition and development including directly attributable fees and expenses but not loan interest
tangible fixed assets and depreciation
tangible fixed assets are 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
freehold premises                      50 years
short leasehold premises            term of lease
plant and machinery                   2 to 3 years
motor vehicles                            3 years 26
statement of accounting policies   31st march 2003
annual report and accounts 2003
taxation
corporation tax is provided at amounts expected to be paid or recovered using the tax rates and laws that have
been enacted or substantially enacted by the balance sheet date
deferred tax is recognised in respect of all timing 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 deferred tax is measured at the average tax rates that are
expected to apply in the periods in which the timing differences are expected to reverse based on tax rates and
laws that have been enacted or substantially enacted by the balance sheet date
finance leases and hire purchase contracts
assets held under finance leases and hire purchase contracts are capitalised and depreciated over the shorter of
their expected useful lives and the lease term the capital elements of the future lease obligations are recorded
as liabilities while the interest elements are charged to the profit and loss account over the period of the leases
to produce a constant rate of charge on the balance of the capital repayments outstanding
operating leases
operating lease rentals are charged to the profit and loss account as incurred
pension costs
contributions paid to group personal pension schemes defined contribution in respect of employees are
charged to the profit and loss account as incurred 27
notes to the financial statements   31st march 2003
annual report and accounts 2003
1  operating profit 12 months ended 16 months ended
31st march 2003 31st march 2002
£000 £000
operating profit is stated after charging
depreciation                   owned assets 63 23
 hire purchase assets 116 54
auditors’ remuneration     audit fees 17 8
 nonaudit fees 3 41
operating lease rentals    property 45 32
 motor vehicles 10 
 plant and machinery 2 6
nonaudit fees paid to the auditors in 2002 includes £33000 charged to the share premium account in that year
2 directors’ remuneration
details of directors’ remuneration including other benefits and share options is given in the directors’ remuneration report on 
pages 16 and 17
six directors are accruing benefits under group personal pension arrangements 2002  three 28
notes to the financial statements   31st march 2003
annual report and accounts 2003
3  staff costs 12 months ended 16 months ended
31st march 2003 31st march 2002
number number
the average monthly number of persons employed by the company including 
executive directors during the period analysed by activity was as follows
construction 15 6
administration 18 7
33 13
12 months ended 16 months ended
31st march 2003 31st march 2002
£000 £000
the employment costs of all employees included above were
wages and salaries 1400 531
social security costs 156 46
other pension costs  group personal pension arrangements 57 25
1613 602
the company operates a group personal pension scheme for its employees at 31st march 2003 payments of £12000
were due to the scheme 2002  £nil
4  interest payable and similar charges 12 months ended 16 months ended
31st march 2003 31st march 2002
£000 £000
interest payable on bank loans and overdrafts 713 279
interest payable on subordinated loans  101
hire purchase finance charges 12 6
725 386 29
annual report and accounts 2003
5taxation 12 months ended 16 months ended
31st march 2003 31st march 2002
£000 £000
united kingdom corporation tax based on the profit for the year at
a rate of 30 2002  30 1282 385
deferred taxation note 13  4
1282 389
tax reconciliation 
standard united kingdom corporation tax rate 30 30
effects of expenses not deductible for taxation purposes  1
small company rate relief  2
effective current taxation rate on profit on ordinary activities before taxation 30 29
6  dividends paid and proposed 12 months ended 16 months ended
31st march 2003 31st march 2002
£000 £000
interim dividend paid at 1p per ordinary share 2002  nil 251 
final dividend proposed at 2p per ordinary share 2002  1p 504 203
755 203
7  earnings per share 12 months ended 16 months ended
31st march 2003 31st march 2002
earnings per share have been calculated using the following figures 
weighted average number of shares in issue 23595753 9329072
dilution  effect of share options 172631 102843
diluted weighted average number of shares in issue 23768384 9431915
profit on ordinary activities after taxation £2990000 £942000
earnings per share basic 1267p 1010p
diluted 1258p 999p 30
notes to the financial statements   31st march 2003
annual report and accounts 2003
8  tangible fixed assets freehold short plant and motor total
premises leasehold machinery vehicles
premises
£000 £000 £000 £000 £000
cost
at 1st april 2002  9 71 276 356
additions 279 5 120 177 581
disposals    18 18
at 31st march 2003 279 14 191 435 919
depreciation
at 1st april 2002  2 21 54 77
charge 1 5 57 116 179
disposals    18 18
at 31st march 2003 1 7 78 152 238
net book value
at 1st april 2002  7 50 222 279
at 31st march 2003 278 7 113 283 681
motor vehicles with a net book value of £283000 are held under hire purchase arrangements 2002  £222000 depreciation of 
£116000 was charged during the year on these assets 2002  £54000
9  stocks and work in progress 31st march 2003 31st march 2002
£000 £000
development properties 19810 13107
10  debtors 31st march 2003 31st march 2002
£000 £000
amounts recoverable on contracts 17722 6277
trade debtors 55 27
other debtors 173 105
prepayments and accrued income 202 67
18152 6476 31
annual report and accounts 2003
11  creditors  amounts falling due within one year 31st march 2003 31st march 2002
£000 £000
hire purchase liabilities 111 73
bank loans 16570 10220
bank overdraft  405
trade creditors 1036 261
land creditors 4656 
corporation tax 1285 385
other taxation and social security 81 30
accruals and deferred income 1184 481
proposed dividends 504 203
25427 12058
the bank loans represent credit line facilities with three banks secured by a debenture over the assets of the company and by
mortgages over the development sites owned by the company interest is payable at rates up to 275 over base rate
details of facilities are given in note 21
12  creditors  amounts falling due after more than one year 31st march 2003 31st march 2002
£000 £000
hire purchase liabilities 12 years 79 74
hire purchase liabilities 25 years 30 35
109 109
13  provision for liabilities and charges 31st march 2003 31st march 2002
£000 £000
provision for deferred tax 4 4
the deferred tax balance arises from the origination and reversal of short term timing differences in respect of
accelerated capital allowances 32
notes to the financial statements   31st march 2003
annual report and accounts 2003
14  share capital 31st march 2003 31st march 2002
£000 £000
authorised
100000000 ordinary shares of 10p each 10000 10000
allotted called up and fully paid
25175000 ordinary shares of 10p each 2002  20250000 2518 2025
on 5th july 2002 as a result of a share placing 4000000 ordinary 10p shares were issued at 75p per share
on 3rd september 2002 a further 300000 ordinary 10p shares were issued at par as a result of share options being exercised
on 19th november 2002 a further 625000 ordinary 10p shares were issued at 80p per share
all shares rank equally in respect of shareholder rights
at 31st march 2003 outstanding options granted over 10p ordinary shares were as follows
share option scheme option price number dates normally exercisable
company approved 50p 250000 5 dec 2004 to 5 dec 2011
605p 148758 5 mar 2005 to 5 mar 2012
615p 146340 3 may 2005 to 3 may 2012
75p 280000 1 oct 2005 to 1 oct 2012
745p 281876 20 feb 2006 to 20 feb 2013
company unapproved 50p 50000 5 dec 2004 to 5 dec 2011
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 33
annual report and accounts 2003
15  capital and reserves share capital share premium profit and loss total
account account
£000 £000 £000 £000
at 1st april 2002 2025 4971 739 7735
arising on issue of shares during the period 493 3037  3530
costs arising from shares issued  158  158
retained profit for the year   2235 2235
at 31st march 2003 2518 7850 2974 13342
16  equity shareholders’ funds £000
profit for the year 2990
dividends paid and proposed 755
2235
new share capital subscribed 3530
costs arising from shares issued 158
5607
at 1st april 2002 7735
at 31st march 2003 13342
17  related party transactions
the company leases the majority of its head offices in loughton from a pension scheme in which andrew wiseman and james 
furlong directors of the company are beneficiaries the charge for the year to 31st march 2003 was £35664 2002  £32240 
in the opinion of the directors the rental is at a market rate
andrew wiseman has purchased an apartment and a parking space from the company at the goldsmith’s row development
contracts were exchanged on these purchases on 21st march 2003 subject to shareholders approval at an aggregate price of 
£255000 prior to the 31st march 2003 a deposit of £25500 was received by the company the directors are of the opinion that
these sales were made at market prices
there is no individual controlling party 34
notes to the financial statements   31st march 2003
annual report and accounts 2003
18  commitments
the company had no capital commitments at either 31st march 2003 or 31st march 2002
current annual commitments under operating leases are as follows
property leases other leases
2003 2002 2003 2002
£000 £000 £000 £000
leases which expire within one year  13  
between two and five years 49 30 17 
over five years    
49 43 17 
19  reconciliation of operating profit to cash flow from operating activities 12 months ended 16 months ended
31st march 2003 31st march 2002
£000 £000
operating profit 4975 1689
depreciation 179 77
profit on sale of tangible fixed assets 12 
increase in stocks and work in progress 6703 13107
increase in debtors 11676 6476
increase in creditors 6185 772
cash flow from operating activities 7052 17045 35
annual report and accounts 2003
20  analysis of change in net debt at cash flows inception of at 31st
1st april 2002 finance leases march 2003
£000 £000 £000 £000
cash at bank and in hand 44 195  239
bank overdraft 405 405  
bank loans 10220 6350  16570
hire purchase liabilities 182 139 177 220
10763 5611 177 16551
21  derivatives and other financial instruments
the company’s financial instruments comprise loan and overdraft facilities and various items such as trade debtors and creditors 
that arise from its operations the company uses loan finance all of which is denominated in sterling to acquire development 
land and undertake site construction it does not enter into any derivative transactions and has minimal exposure to exchange
rate movements as its trade takes place entirely within the united kingdom
at 31st march 2003 the company had overdraft facilities of £12 million at 15 above base rate 2002  £450000 subsequent
to the year end these facilities have increased to £15 million the facilities are due for review by january 2004
in addition the company has a credit line facility with allied irish bank in respect of site development loans of £18 million with 
interest charged at rates of up to 175 above base rate due for review by january 2004 and a further facility with the royal 
bank of scotland of £30 million specific to certain sites and including joint venture funding at similar rates also due for review
by january 2004 the company also has a loan facility of £2 million with heritable bank at 275 above base rate which is 
currently under review
apart from hire purchase liabilities all of the company’s financial liabilities fall due within one year
the fair value of the company’s financial assets and liabilities at 31st march 2003 is as stated in the balance sheet at that date 36
annual report and accounts 2003
abovetaken from a helicopter over bow looking towards canary wharf
below taken from a helicopter over greenwich looking towards canary wharf w anstead
fla ts
west ham
park
east london
cemeter y
victoria park
ha ckney
marsh
ha ckney
downs
finsbur y
park
clissold
park
so u t h w a r k
p a r k
millwall
park
wa nstead
golf
course
greenwich
park
burgess
park
l o w e r l e a cro s s i n g
limeh o use
ro yal victoria dock
t h a m e
f l o o d
b a r r ie
blackwall
tunnel
blackwall
tunnel
west india
docks
the
tower
the
tower
hms belfast
dlr
dlr
dlr
dlr
dlr
dlr
dlr
dlr dlr
dlr
dlr
dlr
dlr
dlr
dlr
dlr dlr
dlr dlr
dlr
dlr
dlr
dlr
newham
waltham forest
lewisham
hackney
islington
tower
hamlets
greenwich
southw ark
wanstead
stratford
west ham
leyton
bow
hackney
greenwich
stepney
lewisham
southwark
stepney
stratford
southwark
bow
west ham
leyton
hackney
lewisham
greenwich
wanstead
southw ark
tower
hamlets
greenwich
islington
hackney
lewisham
wa ltham forest
newham
city of
l ondon
city of
l ondon
river lea
river lea
river lea
docklands
shoreditch
e3
e14
se8
se16
se1
ec3
ec4
ec2
e1
e2
n1
se17
se11
ec1
se10
e15
e5
n16
n5
e7
e9
e8
e2
n1
west
reservoir
east
reservoir
e13
e17
e10
e11
se7
elephant
 castle
uprtha m e s a321 1 s t r eet l ower thamesst reet bywa r ds t  towerhill
w e s t f e r r y
r o a d
a 1 2 0 6
w e s t f e r r y r o a d
a 1 2 0 6
m a n c h e s ter
r o ad a 1 2 0 6
p r e s t on ’ s r o a d
m a r s h
w a l l
a s p e n a1261
w a y
e a s t i n d i a a13 d o c k
r o a d
a 13 n e w h a m w a y
a13
b a r k i n g a124 r o a d b a r k i n g
m a n o r
a1 011 r o a d
s i l v e r t o w n a1 0 20 w a y n o r t h w o o l w i c h r o a d
c o m m e r c i a l r o a d a13 c o mm e r c i a l
r o a d
m inorie s
eastsmithfield a 12 0 3 t h e h i g h w a y
a 120 3
link tunn e l
t o we r
b r i d g e r o a d towerbridge t bapr
l o n g l a n e
abb ey b 2 0 2 street
southwark a3200 st 
st thom asst 
cheapside
l om bardst  fe nchurch street
l o n d o n w a l l
fleet st  ludga te hill st p a ul’s c a n n o n s t r e e t
via ne wg atest 
alde rsgate
goswellrd 
g o s w e l l r o a d
enwe ll
r oad o l d a5201 s tree t old a 5201 street
h a c k n e y r o a d
b l a c k f r i a r s a201 r o a d blackfriars
bridge
farringdon rd farringdon st
london road
borough road
a3 kennington park rd
newington causeway b o r o u g h h i g h s t  elephant
 castle
waterloo rd
g r e a t d o v e r s t 
so u thwark bridg e
rd southwark
bridge
london bridge
druid street
j a m a i c a
r o a d
lower a200 road
e v e l y n s t r e e t
c r e e k r o a d romney road trafalgar road wo o lwich a206
r e d rif f a 2 0 2 r o a d
b runel rd s a l t e r
b 2 0 5
r o a d
tunnel app  a101
rotherhithe tun
r o t h e r h i t h e n e w
a 2 2 0 2 r o a d
b l a c k w a l l t u n n e l s o u t h e r n a p p r o a c h a 102 r oad a206 woolwich road
b i s h o p s g a t e s h o r e d i t c h h i g h s t 
k i n g s l a n d r o a d kingsl and high st  stoke newington rd stoke newing ton high st  s t a m f o r d h i l l
c i t y a 5 0 1 r o a d cit y r o a d
m o o r g a t e
u p p e r
e s s e x
a 1 0 4 r o a d
a 1 s t r e e t
c a n n o n b u r y rd n e w
n o r t h rd
st  p a ul ’ s a1199 r o a d b a l l s p o n d rd dalston g r a h a m r o a d
q u e e n s b r i d g e r o a d lane
p e m b u r y r d crick etfield rd
l e a a104 b r i d g e a104 r o a d l e a a104 b r i d g e r o a d
c l a p t o n r o a d
u r s w i c k r d h o m e r t o n h i g h s t  m a r s h h i l l hom erton b112 road
dal ston ln lwr cl apton r
a m h u s t a 1 0 7 p a r k
c l a p t o n c o m m o n
u p p e r
c l a p t o n r o a d
s e v e n a503 s i s t e r s a503 r o a d s e v e n s i s t e r s rd
g r o v e l o r d s h i p r d
brownswood rd l o r d p a r k n a n n o r b105 r d
g r e e n a 1 0 5
l a n e s
green a 1 05 lanes
d green road blackstock road highbury park highbury grove
r o a d
b e t h n a l a 1 2 0 9 g r e e n
great eastern s t c o m m e r c i a l s t  leman st  dock st 
w h i t e c h a p e l a 1 1 r o a d
m i l e a 1 1 e n d
r o a d
b o w
r o a d a11
h i g h s t r e e t a11
broadway
a118
r o m f o r d r o a d
dens ham r p o r t w a y p l a s h e t r o a d
w e s t ham l a n e
n e w p l a i s t o w r o a d a112 high street g ree ngate s t 
stopford rd  u p t o n
a 1 1 4
l a n e
g r e e n
b167
r o a d
w oodgr annge rd woodford road a114 c e n t r e r o a d
b l a k e h a l l r o a d
a l d e r s b r o o k
b ush a11 4 road
the grove
h i g h r o a d
l e ys t o n e h i g h r o a d l e y t o n s t o n
eastway ruckhol t r o ad a106 grove
a106
g reen r o a d
a12
east cross route
a12
a12
a 1 2
b u r d e t t
a1205 r o a d
c a m b r i d g e h e a t h r d
m a r e s t re e t
v i c t o r i a p a r k a 1 0 6 r o a d east way
c a r p e n t e r ’ s
a 1 1 5 r o a d
high rd leyton major rd
high road
leyton
high r o a d
high ro a d
m a rk house a10 0 6 rd c h u r c h a 1 0 0 6 r o a d
g r o v e a1205 r o a d
chobham road
liverpool
street
cannon
street
london
bridge
wal w o r t h a215 r o a d
c a m b e r w e l l r oa d a2 1 5
n e w k e n t a201 r d
o l d k e n t a 2 r o a d a 2 0 1
new cros s r o a d a 2
blackheath road
s h o o t e r s h i l l r oa d a 2 shooters hi l
rochester way relief rd
c a m b e r w e l l n e w a 2 0 2 r o a d
p e c k h a m r o a d a 2 0 2 peckha m h i g h st que ens a202 r o a d
deptford church st  a2209
greenwich a206 high road
greenwich south st 
kidbrooke a2213 park rd
lewisham a20 way
kender street
island
gardens
completed by mid 2003
mornington grove
lansdowne drive
t udor lodge
de beauvoir
garden walk
goldsmiths goldsmith’s row
blondin street
devons rd
gale st
coldharbour
manchester rd
pelling st
hawgood st
abbotts wharf
limehouse
follett st 1
john penn st
island gardens
follett st ii
key
warton road
gre at ea s tern
ro ad
current and future sites
straightsmouth
37
development guide 
annual report and accounts 2003 telford homes plc
3 buckingham court rectory lane loughton 
essex  ig10 2qz
tel 020 8498 6789  
fax 020 8498 6777
wwwtelfordhomesplcuk


Summary:
 1
financial highlights
31st march 2003
£253m
£88m
510 15 20 25
12 3 4 5
31st march 2002
£43m
£13m
3p
1p
127p
101p
31st march 2003
406
344
31st march 2002
204
182
turnover
profit before tax
dividend per share
earnings per share
pretax return on
average equity
pretax return on
average total capital
annual report and accounts 2003
12 3
123456789 10 11 12 13 14
510 152025 30 354045
510 152025 30 354045
31st march 2003
31st march 2003
31st march 2003
31st march 2002
31st march 2002
31st march 2003
31st march 2002
31st march 2002