09
telford homes plc
annual
report and
accounts
telford homes plc annual report and accounts 2009 www telfordhomes plc uk
telford ra cov  15609  1713  page 1 financial highlights 2009
revenue
£1067m
09 £1067m
08 £968m
adjusted gross
profit margin
200
09 200
08 216
adjusted operating
margin
113
09 113
08 106
profit before tax and
exceptional items
£73m
09 £73m
08 £65m
number of open
market completions
350 properties
09 350
08 306
earnings
per share
81p
09 81p
08 122p
gearing
2066
09 2066
08 1915
uncovered
gearing
807
09 807
08 656
development
pipeline
2635 properties
09 2635 properties
08 2959 properties
restated to reflect the adoption of ifric 15 and ias 23 revised
before all interest charges including those expensed within cost of sales of
£37 million 2008  £39 million and exceptional items
telford ra cov  15609  1713  page 2 telford homes plc 2009 02
financial highlights 01
chairman’s statement 05
chief executive’s review 07
financial review 15
business  financial review
area of operation 23
operational structure 25
key risks and uncertainties 27
operating review
corporate responsibility
directors and advisors 39
policy on corporate governance 41
directors’ remuneration report 43
report of the directors 45
statement of directors’ responsibilities 48
auditors’ report 49
corporate governance
group income statement 53
balance sheet 54
statement of changes in equity 55
cash flow statement 56
statement of accounting policies 57
notes to the financial statements 61
development guide 82
financial statements
contents
health and safety 31
environment and sustainability 33
regeneration 35
telford ra text  15609  1802  page 1 knowledge
telford ra text  15609  1802  page 2 business  financial review
telford ra text  15609  1802  page 3 05     telford homes plc 2009
chairman’s statement
“i am extremely
pleased that
telford homes is
able to report a
profit before tax of
£73 million before
exceptional items”
david holland 
chairman nonexecutive
i am extremely pleased that telford homes is
able to report a profit before tax of £73 million
before exceptional items and a profit before
tax of £43 million after exceptional items for 
the year to 31st march 2009
our focus over the last six months has been on
achieving legal completions on properties pre
sold to the investor market primarily during 2006
and 2007 in an environment where mortgage
availability is heavily restricted and confidence 
in the housing market and the wider economy
remains low despite this the sales and customer
service teams have been very successful in
working with each customer individually to
secure as many completions as possible
in the past year telford homes has not
committed to new land purchases beyond its
existing partnerships with affordable housing
providers nor has the group commenced
construction on several sites that are ready for
development the group is working hard to
secure contracts to construct a number of its
developments entirely for affordable housing
and the £57 million grant programme that
telford homes has recently agreed with the
homes and communities agency “hca” is
assisting the group in ensuring that profitable
construction work can continue together the
grant programme and partnerships with housing
associations will ensure the group plays a role in
continuing the supply of new housing at a time
when construction of new homes has slowed to
just 25 per cent of government targets
i am also delighted to report that the excellent
relationships the group has with each of the banks
financing telford homes have been critical in
concluding negotiations to renew or extend
existing facilities securing this debt finance
enables the group to focus on generating
operational cash flows and reducing gearing
where appropriate
control of cash remains a priority over the coming
months as the group continues to pursue legal
completions on presold properties despite the
success to date the board must remain cautious
of an increase in the rate of failed contracts as 
a result the board has concluded that it is not
appropriate to pay any dividend in relation to 
the year to 31st march 2009 telford homes
remains on a sound operational and financial
platform and depending on market conditions
the board hopes and expects to be able to 
return to paying dividends in the near future
david holland
chairman nonexecutive
26th may 2009
telford ra text  15609  1802  page 4 telford homes plc 2009 06
business  financial review
merchants’ quarter e3
telford ra text  15609  1802  page 5 “the board is cautiously
optimistic in its outlook
and believes telford
homes is well placed
to benefit from a future
improvement in
market conditions”
andrew wiseman
chief executive
in spite of the unprecedented and difficult
financial environment for the group’s investor
customers the number of open market property
completions achieved in the year to 31st march
2009 rose to 350 from 306 in the previous year total
revenue has grown by 10 per cent to £1067 million
with profit before tax and exceptional items up 12
per cent to £73 million
the group reported in september 2008 that new
accounting standards had resulted in a change
to its accounting policies in relation to open
market private homes with revenue and profit
now recognised on legal completion on
affordable homes sold to housing associations
under construction contracts revenue and profit 
is recognised on a percentage of completion
basis there are currently over 700 affordable
homes being developed and payments will
continue to be received from the group’s
housing association partners as construction 
of these homes progresses
sales
the strategy of telford homes has always been
to presell open market homes at a very early
stage of construction whenever possible the
success of this strategy in the past has meant
that the group has had relatively few properties
available for sale over the past twelve months
market conditions have affected the confidence
of purchasers of new homes and as such the
marketing of unsold homes on developments
due for completion in 2010 and 2011 has been
held back while construction continues with
substantial forward sales on these projects
including the affordable housing the group’s
decision to continue building has been taken
with a recognition that lower open market sales
prices may be realised in the future
efforts to secure new sales have been
concentrated at the group’s developments 
at queen mary’s gate in south woodford and
nayland court in romford at queen mary’s gate
the first phase of the development including 184
open market homes was completed in may 2008
and all but one have been sold and occupied
with the final property now reserved the second
phase including 93 open market homes was
completed in november 2008 and 29 have been
sold to date the third phase including 95 open
market homes will not be build complete until the
second half of 2010 overall sales at queen mary’s
gate have been considerably slower throughout
the last twelve months although eight sales have
completed in the last twelve weeks with a further
four reserved and one property where contracts
have been exchanged visitor levels are now
much higher than at the end of 2008 and this 
gives the board an expectation that a slow but
steady rate of sales will continue to be achieved
through the rest of this year
07     telford homes plc 2009
chief executive’s review
telford ra text  15609  1802  page 6 telford homes plc 2009 08
business  financial review
metro east e3
telford ra text  15609  1802  page 7 09    telford homes plc 2009
chief executive’s review continued
onestratford e15
telford ra text  15609  1802  page 8 20000
0
30000
40000
50000
60000
70000
80000
mar 09
feb 09
jan 09
dec 08
nov 08
oct 08
sep 08
aug 08
jul 08
jun 08
may 08
apr 08
mar 08
feb 08
jan 08
seasonally adjusted monthly number of mortgage approvals for house purchases by individuals
source bank of england
at nayland court in romford telford homes has
26 build complete homes remaining for sale with
demand for these being maintained by the ‘my
choice home buy’ scheme “mchb” from the
hca which provides a mortgage for up to 50
per cent of the home with a very low deposit
and interest rate the processing of mchb
applications suffers from periodic delays in the
release of funds but the group has seven homes
currently reserved on the development all using
this product here again recent progress means
the group would expect to sell the majority of
the remaining properties during 2009
telford homes will bring other developments
back to the market when conditions are right
and when construction on those developments
reaches an appropriate stage to attract buyers
completions
from 1st october 2008 telford homes began 
a rolling programme where 613 open market
homes sold in previous years would become
due for legal completion in the period up to
march 2010 as at 31st march 2009 220 of 
these properties had been legally completed
the key issues for the group’s customers are the
restriction of mortgage finance for buytolet
investors and the increasing caution applied by
valuation surveyors with a lack of comparable
transactions importantly the group’s properties
continue to attract tenants for its investor
customers and this underpins their value
the general problems experienced in securing
mortgages are illustrated by statistics for the
number of mortgage approvals for house
purchases in 2008 the bank of england
seasonally adjusted figures show that the number
of approvals per month fell rapidly from 71000 in
january 2008 to 27000 in november 2008 since
then there has been some improvement in these
statistics with the number of approvals reaching
39000 in march 2009 this is still well below normal
levels and whilst to date the process of achieving
new sales and completions has not got any easier
the board hopes it is an indication that mortgage
availability will improve during the rest of 2009
telford homes continues proactive
communication with each purchaser to ensure
their financial arrangements are instigated at
the right stage and the group has been
working with each of them to maximise the
chances of achieving completions in addition
telford homes has maintained a dialogue with
some of the major lenders and their valuers to
give maximum comfort in the pricing of the
group’s apartments through transparency of
information and supporting evidence the
board has reported in the past that the telford
homes approach to sales is based on net prices
agreed at the point of sale with no undisclosed
discounts or incentives and this has proved
extremely important both to customers of
telford homes and their lenders
the group will rescind contracts on properties
where its customers are unable to complete 
the purchase retaining the 10 per cent deposit
already paid where necessary telford homes
will also take legal action against the defaulting
purchasers as a result of their failure to honour
contractual obligations
telford homes plc 2009 10
business  financial review
telford ra text  15609  1802  page 9 11     telford homes plc 2009
despite achievements to date the group is
experiencing significant delays in securing each
completion as a result the board has positioned
telford homes to withstand an increased number
of delays and failures the total number of failures
in the year to march 2010 is forecast to reach
between 60 and 80 of the presold homes due to
complete over that period assuming there is no
improvement in mortgage availability
telford homes has contingency plans in place to
deal with failed contracts which will mitigate the
impact on cash flow these plans include
temporarily securing tenants for the properties
before reselling them into an orderly market the
group has obtained outline terms from each of
its three banks to provide mortgages against a
portfolio of these rented properties at between
50 and 60 per cent of their value and in addition
the group is well advanced with contractual
negotiations to secure £6 million of funding from
alternative sources at a 75 per cent loan to value
ratio this will enable the business to withstand
significantly more failures than anticipated as 
well as providing cash resources to further our
partnerships with housing associations and
housing transfer organisations
hca and affordable housing
the board has taken a number of steps to
maintain activity in the construction of new homes
through partnerships with housing associations and
the hca as reported on 20th april 2009 the group
has agreed a grant programme with the hca of
£57 million across four sites owned by telford homes
and three estate regeneration projects in
partnership with eastend homes the grants will
part finance over 400 affordable homes over 
the next three years
partnerships with affordable housing providers
remain integral to the business and typically 35
per cent of any development is sold for
affordable housing however in order to derisk
new projects the group has sought to construct
some developments entirely for its housing
association partners utilising hca grant although
at a lower margin this gives telford homes the
ability to commence construction on these sites
with secured cash inflows over the course of the
development the group has recently entered
into a contract with family mosaic to construct 63
affordable homes across two sites in queens
road southwark and a contract with gallions
housing association to construct 53 affordable
homes in st anne’s row e14 the group has also
agreed terms to construct 64 affordable homes
for poplar harca in lanrick road e14
chief executive’s review continued
sobow e3
telford ra text  15609  1802  page 10 telford homes plc 2009 12
partnerships and the development pipeline
telford homes has maintained its prudent
approach to investment in land during the last
twelve months whilst retaining financial resources
to deploy in its partnerships with eastend homes
and poplar harca the group reported last year
that 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
the british estate e3 has set the model for the
partnership with eastend homes where land
payments made by telford homes have been
reinvested into the third party refurbishment of
existing homes on the estate the group has now
entered into a contract to build 54 affordable
homes on the st george’s estate e1 for eastend
homes along with a construction contract for
infrastructure works required on the estate in
addition telford homes has option contracts over
land on the estate to provide 139 open market
homes and these are due from 2010 onwards
construction of the affordable homes is now
underway and as such the group has drawn 
its first grant tranche from the hca
telford homes continues to progress master plans
for the regeneration of five other estates with
eastend homes and the group expects to
commence construction of 74 affordable homes
on the bede estate e3 in autumn 2009 bede and
the other estates are expected to add in excess
of 900 properties to the development pipeline
over the next few years and the partnership with
poplar harca an additional 400 properties
as at 31st march 2009 the total pipeline of open
market and affordable properties not yet legally
completed was 2635 including 2400 with
planning permission this total includes sites
under option contracts within the control of the
group of these properties 1503 are under
construction with 1115 currently secured by
contracts exchanged either for open market
sale or for affordable housing open market
presales contracts totalled £1284 million at 31st
march 2009 although some of these will fail 
to complete leaving the group with unsold
property affordable housing revenue contracted
but not yet recognised totalled £346 million at
the year end and this is secured through payments
received from housing associations as
construction progresses
business  financial review
decorum e10
telford ra text  15609  1802  page 11 13     telford homes plc 2009
chief executive’s review continued
planning
the group’s focus on east london gives telford
homes significant development presence that
engenders respect from the local planning
authorities and the group has achieved a
number of important permissions this year these
include 193 homes on the st george’s estate
236 homes on the bede estate and 209 homes
on the holland estate the group is working 
with both eastend homes and poplar harca 
to achieve planning permissions on land owned
by them that will later be developed under 
the existing partnerships only two of the sites
owned directly by telford homes do not have
detailed planning permission and the group is
progressing plans on each of these with the 
aim of receiving approvals during 2009
people
in december 2008 the group reported that 
the board expected to reduce the number 
of people employed by telford homes by
between a quarter and a third before the end of
2009 depending on success in securing projects
that do not require a cash investment the hca
grant programme and the group’s expectation
of constructing affordable housing on a number
of developments gives the board confidence
that the number of redundancies will be less
than originally feared as ever and in particular
during these difficult times with pay frozen and
no bonuses being paid the board is extremely
grateful for the commitment and effort shown
by all of the group’s employees
construction
despite the impact that market conditions and
the redundancy programme have had on
morale telford homes has continued to produce
well designed and well built developments this is
a real credit to the work of the operating divisions
in a period that has seen continual appraisal of
prospects and a consequent reorganisation
alongside redundancies
the quality of the finished product continues 
to be ensured by the work of the telford homes
customer service team that provide quality
control and give a consistent ‘face’ to customers
the delivery of a first rate home is a fundamental
step in the completion process
construction is the heart of telford homes and
health and safety is at the forefront of the
group’s working practices the group has
continued to develop and monitor its policies
and procedures during the year and its very
good record has been maintained 
current trading and outlook
the focus at the start of the new financial year
remains on maximising positive cash flows into the
business including achieving legal completions
already since 1st april 2009 over 50 open market
homes have been completed and handed over to
customers and this progress remains encouraging
0
10000
20000
30000
40000
50000
60000
first quarter 2009 first quarter 2008 first quarter 2007
number of new homes starts recorded in january to march of each year 
source nhbc statistics
telford ra text  15609  1802  page 12 telford homes plc 2009 14
business  financial review
the group will continue to work on securing
profitable contracts to construct affordable
housing on some of its sites with the added 
cash flow benefit to telford homes this will be
substantially supported by the grant programme
with the hca and the group expects to draw up
to 60 per cent of its total allocation before 31st
march 2010 this will partly be utilised as payment
for land purchased from the group’s development
partners alongside this sales and marketing
activity will be concentrated on the completed
units at queen mary’s gate where we are
experiencing increased interest from potential
purchasers and romford before turning to other
sites again at the appropriate time and when
market conditions are right
across the country construction of new homes has
reached a new low for recent years with national
housebuilding council “nhbc” statistics for new
home starts at 16200 for the first quarter of 2009
against 37800 in the first quarter of 2008 and 53700
for the same period in 2007 this will inevitably lead
to an increased shortage of new homes in the next
few years and telford homes will be ready to meet
the challenge of satisfying demand when the time
comes east london will be at the forefront of
increasing the supply of new homes in london 
as regeneration of the area continues
the board is cautiously optimistic in its outlook due
to increased activity at queen mary’s gate and
legal completions on presold homes progressing
as well as could have been anticipated the hca
grant programme and the group’s partnerships
with affordable housing providers will underpin the
performance of telford homes in the next few
years the board believes the business is now in a
strong position and is well placed to benefit from
a future improvement in market conditions
andrew wiseman
chief executive
26th may 2009
stadthaus n1 casa e14
telford ra text  15609  1802  page 13 “control of cash and
careful monitoring of
cash flow forecasts
has been critical
over the last
twelve months”
jonathan distefano 
financial director
control of cash and careful monitoring of cash
flow forecasts has been critical over the last
twelve months this has included ensuring that the
group’s banking arrangements and facilities are
sufficient and capable of supporting the business
in the future negotiations with each of the three
banks funding telford homes have resulted in
new and extended facilities with appropriate
covenants and i am pleased that the group’s
relationships with the banks remain as strong as
ever in a very difficult economic climate
accounting changes
on 25th september 2008 the group announced
changes to its accounting policies as a result of
the early adoption of two new accounting
standards ifric 15 and ias 23 revised revenue
and profit from the sale of open market private
homes is now recognised on legal completion 
in addition borrowing costs are capitalised within
inventories on a site by site basis and expensed
through cost of sales as and when revenue is
recognised these changes are reflected in the
results to 31st march 2009 and the previous year
has been restated on the same basis further
details are provided in note 21
in addition the group has increased the number
of subsidiaries in its ownership during the year with
trading activity taking place in a subsidiary for the
first time and trading continuing in the group’s
jointly controlled entities as a result the 2009
financial statements have been prepared as
consolidated group accounts with comparative
information provided for 2008
operating results
revenue increased to £1067 million from £968
million with 350 open market completions secured
at an average price of £253000 adjusting for
homes sold through jointly controlled entities
where the group recognises half of the revenue
and profit the total revenue from open market
housing and commercial units in the year was
£832 million with a further £223 million arising from
progress on construction contracts for affordable
housing and £12 million of other income
gross profit before exceptional items was £176
million which is stated after expensing loan interest
that has been capitalised within inventories under
the new accounting standard ias 23 revised
total loan interest included within cost of sales was
£37 million and before charging this interest the
gross margin in the year was 200 per cent against 
a restated adjusted margin of 216 per cent in 2008
despite a move to undertake lower risk and lower
margin construction work such as the development
of affordable housing the margin before interest 
has held at the group’s target level for a normal
economic environment this is primarily due to
revenue and profit being recognised on legal
completion of properties which were secured 
by contract before the downturn in the 
property market 
in the coming year telford homes expects to
undertake more development for housing
associations at lower margins commensurate with
the risk and also expects an increasing number of
previously sold homes to fail to complete at their
original contract price both of these factors will
result in a lower reported margin in the future
15     telford homes plc 2009
financial review
telford ra text  15609  1802  page 14 telford homes plc 2009 16
business  financial review
onestratford e15
telford ra text  15609  1803  page 15 the operational teams continue to monitor and
control development costs in a period that has
seen significant changes in some raw material
costs due in many cases to adverse movements
in exchange rates but has also seen a gradual
decline in labour and subcontract costs as the
demand for construction work has fallen the
group’s commercial teams are focused on
achieving cost savings in the coming months
and while maintaining good relationships with 
all suppliers they will ensure that telford homes
achieves appropriate tender prices in the 
current market
total build costs in the year to 31st march 2009
were £79 million up from £76 million last year with
the rate of expenditure declining over the last six
months as developments have been completed
and have not been replaced by new site starts
telford homes has taken a cautious approach to
commencing construction on some sites where
future revenues cannot be substantially secured
at an early stage in the development
the operating margin before exceptional items
and interest charged to cost of sales was 113 per
cent to 31st march 2009 up from 106 per cent
last year administrative expenses are carefully
controlled and have reduced year on year by
three per cent the group has taken the decision
not to increase salaries or to pay any bonuses to
employees this year while the threat of
redundancies remains selling expenses are down
significantly falling by 41 per cent in keeping with
reduced sales and marketing activity in the last
twelve months
exceptional items
the exceptional items reported in the year to 31st
march 2009 are primarily write downs to the value
of land and work in progress across a number of
sites totalling £29 million along with £01 million in
relation to redundancy costs the write downs
represent less than two per cent of the value of
inventories write downs have not been required
on developments where the group expects to
construct 100 per cent affordable housing at a
positive margin
interest
total interest paid in the year was £64 million
reduced from £74 million last year average
borrowings were higher in the year to 31st march
2009 at £113 million against £93 million last year
and therefore significant savings have been
achieved as a result of the fall in the base rate
over the course of the last twelve months prior 
to refinancing the majority of the group’s loans
were linked to the base rate interest charged to
the income statement includes £37 million in cost
of sales 2008  £39 million and a further £12
million of finance costs 2008  £04 million
17     telford homes plc 2009
financial review continued
queen mary’s gate e18
telford ra text  15609  1803  page 16 telford homes plc 2009 18
primarily as a result of suspending the capitalisation
of interest on certain sites that are not progressing
in terms of design or construction
interest received in the year was £02 million
down from £05 million last year as a result of
lower interest rates on deposits
all bank facilities have been extended renewed 
or refinanced over the last few months going
forward interest will be charged on the group’s
facilities at base rate plus a margin of between
25 and 40 or libor plus a margin of between
20 and 30 the rates telford homes has
secured are competitive in the current market
and recognise the group’s long term relationships
and the quality of the information provided 
to each bank to assess the risk inherent in 
each development
borrowings
all of the companies within the telford homes
group use loan finance to acquire development
land and undertake site construction loan
facilities are in place with three banks and are
secured by debentures and by charges over
development sites
the group has site specific loan facilities with
allied irish bank totalling £276 million in respect
of certain development sites these facilities
were renegotiated in april 2009 at 31st march
2009 the group had utilised £212 million of its
facilities with allied irish bank leaving an unutilised
balance on the new facilities of £64 million going
forward the facilities expire on different dates
depending on the specific circumstances of
each development and are normally repayable
on build completion of each development from
the sales proceeds received
the group’s jointly controlled entity bishopsgate
apartments llp has a fully utilised loan facility
with allied irish bank of £200 million in respect of
the purchase of development land in bethnal
green road the group has recorded its 50 per
cent share of the loan in its balance sheet at
31st march 2009 the facility is on a rolling one
year term
in addition the group and its subsidiaries have
site specific loan facilities with the royal bank 
of scotland totalling £663 million in respect of
certain development sites also renegotiated in
april 2009 at 31st march 2009 the group had
utilised £622 million of its facilities leaving an
unutilised balance of £41 million these facilities
also expire on different dates depending on the
specific circumstances of each development
the group’s jointly controlled entity telford homes
creekside limited has a loan facility with the
royal bank of scotland of £513 million in respect
of the purchase of development land and
construction in greenwich at 31st march 2009
telford homes creekside limited had utilised
£162 million of this facility leaving an unutilised
balance of £351 million the group has recorded
its 50 per cent share of the loan in its balance
sheet at 31st march 2009 this facility is due for
repayment in december 2011
business  financial review
90
0
100
110
120
130
may 09
apr 09
mar 09
feb 09
jan 09
dec 08
nov 08
oct 08
sep 08
aug 08
jul 08
jun 08
may 08
apr 08
mar 08
total borrowings in £ million by month
telford ra text  15609  1803  page 17 icona e15
19     telford homes plc 2009
financial review continued
icona e15
telford ra text  15609  1803  page 18 finally the group has site specific loan facilities
with barclays bank totalling £126 million in
respect of certain development sites again
renegotiated in april 2009 at 31st march 2009
the group had utilised £73 million of these
facilities leaving an unutilised balance of £53
million the facilities are due for repayment
between june 2010 and september 2010
at 31st march 2009 the group had unutilised
overdraft facilities of £30 million
2008  £30 million
these bank facilities ensure that adequate
funding is available to cover working capital
requirements and the board consider that
existing facilities are sufficient to cover funding
requirements in the foreseeable future where
facilities are due to expire within one year this is
due to the timing of development completions
and therefore the expected repayment dates 
in all of these cases the loans are expected to
be repaid by the date the facility expires
some of the groups bank facilities are subject 
to a number of general and financial covenants
which are tested periodically by each bank in 
all cases the board have assessed whether the
group will remain in compliance with the
covenants in the short to medium term and 
are satisfied that there will be no breach of the
covenants that cannot be easily rectified
borrowings at 31st march 2009 were £1120 million
2008  £1014 million with gearing at 2066 2008
 1915 total debt and gearing rose for the first
seven months of the year while development work
continued on sites nearing build completion and
reached a peak in october 2008 of £127 million
and 275 the subsequent flow of completion
proceeds has enabled significant repayments to
be made and borrowings have now fallen 
below £100 million
telford homes continues to monitor ‘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 telford homes
allowing for the risk that a proportion of secured
contracts fail to complete the level of uncovered
gearing at 31st march 2009 remains within
acceptable limits at 807 2008  656
the group’s focus on generating operating
cash inflows will result in further reductions in the
level of debt and gearing in the business over
the next twelve months and this will continue
unless additional funding is required for projects
where the future revenues can be secured at
an early stage in the development
balance sheet
net assets have increased to £503 million from
£489 million and net assets per share at 31st
march 2009 were 1298 pence the group
continues to carry forward tax losses arising 
from the change in accounting policies and
restatement of the 2008 figures but expects to
utilise remaining losses in the year to 31st march
2010 and return to making tax payments
dividends
telford homes remains cautious in its appraisal 
of future cash flows and as such the board has
taken the decision not to pay any dividend in
relation to the year to 31st march 2009 this is a
prudent approach reflecting the uncertain
timing of completion proceeds the board will
continue to monitor performance with a view 
to reinstating a dividend as soon as the board
considers it prudent to do so 
cash flow
control of cash remains of critical importance 
and we maintain a detailed month by month 
cash flow forecast as part of our management
information systems this enables the group to
continuously monitor forecast and actual cash
flows over a five year period and to perform
sensitivity analysis on these forecasts the forecasts
are necessarily subject to a number of assumptions
and judgements and these are tested on 
a reasonable basis by the sensitivity analysis 
these forecasts and the related sensitivity analysis
are reviewed by the board in detail on a monthly
basis in addition all of the forecasts and supporting
calculations are made available to each bank
on a monthly basis the current forecasts show
positive cash balances beyond the next twelve
months and at no time is the group forecasting 
to make use of its overdraft facilities
jonathan distefano
financial director 
26th may 2009
telford homes plc 2009 20
business  financial review
telford ra text  15609  1803  page 19 telford ra text  15609  1803  page 20 operating review
construction
telford ra text  15609  1803  page 21 telford homes continues to develop
in east london and that focus will
not change in the coming years
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 despite the
current economic environment 
local knowledge has played a key
role in the success of the group over
the last few years 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 remain a major
boost to east london with construction
of the olympic park in stratford now
well underway and with many other
events due to take place in the local
london boroughs this continues to
accelerate the programme of
regeneration that was already taking
place including further improving
transport links to the region examples
include the extension of the east
london line improvements to the
docklands light railway and further
into the future the crossrail project 
telford homes expects to maintain
construction in east london wherever
possible and along with our
affordable housing partners will play 
a significant role in the supply of new
homes to a key growth area where
there is already a housing shortage
23     telford homes plc 2009
tower bridge
the city
stadthaus
area of operation
telford ra text  15609  1803  page 22 avantgarde
stratford
canary wharf
o2 arena
greenwich
kinetica
st george’s
greenwich creekside
casa
metro east
merchants’ quarter
onestratford
sobow
telford homes plc 2009 24
operating review
telford ra text  15609  1804  page 23 25     telford homes plc 2009
the economic environment in the last twelve
months has resulted in telford homes applying 
a prudent approach both to committing to
new land expenditure and also to undertaking
significant construction work on developments
where the future expected revenue cannot be
substantially secured at an early stage
as a result of this and a general tightening of
the availability of finance to undertake new
developments the board has planned for a
reduction in the operating capacity of the
business in the short to medium term as a result
the structure of telford homes reverted back to
two operating divisions during the year to 31st
march 2009 this structure will be kept under
review in the future
at 31st march 2009 the group had over 2600
properties in the development pipeline and
these properties need to be managed through
the planning process in design and ultimately
during construction in order to control this
process telford homes is organised into two
operating divisions being alto and metro 
this structure is necessary in order to manage the
delivery of several hundred homes per annum
and ensures management control to yield
excellent design high standards of construction
and delivery on programme each division
predominantly 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 10
developments and metro are responsible for 
over 900 properties across 20 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 mark parker is responsible for
metro and john fitzgerald is responsible for alto
and each division has a management team
responsible for day to day operations
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
the interaction between customer service and
the operating divisions has been particularly
important in ensuring a consistent high quality
product is presented to customers which is
fundamental to the process of achieving
successful legal completions
operational structure
sobow e3
telford ra text  15609  1804  page 24 telford homes plc 2009 26
operating review
icona e15
telford ra text  15609  1804  page 25 27     telford homes plc 2009
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 increasing
consumer costs for other goods and services all of these are outside of the group’s control
the group’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 74 per cent of properties under construction 
at 31st march 2009 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 as smoothly as possible
land acquisition
the group 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
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
telford homes 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 group has 235
properties in the development pipeline going through the planning process reduced from 454 last year
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 group
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 
key risks and uncertainties
telford ra text  15609  1804  page 26 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 group 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
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
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 group is not operating beyond its financial capacity part of this
process involves the forecast of bank funding for each development and the availability of sufficient
bank finance is therefore also of critical importance
telford homes 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 group’s banking partners on a monthly
basis telford homes 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
political environment
changes in laws and regulations can have a direct impact on the efficient running of the group and
the costs incurred on each development changes in both local and national government can have
a direct bearing on the regulatory environment
telford homes 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 
telford homes plc 2009 28
operating review
telford ra text  15609  1804  page 27 telford ra text  15609  1804  page 28 corporate responsibility
regeneration
telford ra text  15609  1804  page 29 “telford homes
continues to regard
the promotion of
health and safety as
a critical objective
of all employees
at every level”
steve nicoll 
group health  safety manager
telford homes 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 
we invest in the training and development of our
people with the continuation of our ‘health and
safety core’ training programme this programme
ensures that all employees and in particular those
deemed as ‘safety critical’ have the appropriate
skills and level of training to be able to discharge
their duties 
for the first time telford homes entered the ‘royal
society for the prevention of accidents’ rospa
awards which is a highly respected national and
international health and safety body that is widely
recognised for its impartiality across all industries
we are pleased to announce that telford homes
received ‘silver awards’ for both the ‘health and
safety achievement award’ and ‘management
of occupational road risk’ these awards are 
a fantastic achievement for us and show how
advanced we are in our management of health
and safety the entries have to include the last
five years of health and safety performance
including all incidents and accidents as well as
providing documented responses to a number 
of questions the silver awards are a great start
and i am confident that next year we should be
able to go one better
this year saw the introduction of our revised
‘group health and safety procedures’
following on from an intensive review of our
existing systems and processes the new
procedures are intended to reinforce the
excellent health and safety standards already 
in place by standardising our approach and
updating the relevant systems and processes
we are still working towards gaining our
occupational health and safety management
system ohsas 18001 accreditation and the
introduction of our new health and safety
procedures is fundamental to the accreditation
process on most of our projects we operate the
considerate constructors scheme and we are
monitored regularly against performance criteria
our ‘executive safety committee’ and
‘operational safety forum’ continue to 
meet regularly and have been instrumental in
developing significant changes to our procedures
in particular the ‘operational safety forum’ made
up of our senior operational management teams
debates discusses and agrees tactics both
reactive and proactive to ensure unplanned
events do not reoccur this forum monitors ‘trend
analysis’ covering the results of site by site health
and safety inspections this helps our site managers
and senior management team to make continual
improvements in the standards of health and
safety on site
31     telford homes plc 2009
health and safety
telford ra text  15609  1804  page 30 the introduction of our monthly edition of 
‘safety matters’ issued to all employees has been
received positively by all and includes internal
and external news as well as recent external
prosecutions the publication is seen as a subtle
and effective means of communication to
continually stimulate discussion and keep health
and safety in the forefront of people’s minds 
our ‘supplychain’ procedure is now fully
developed with the vast majority of our suppliers
now vetted by our health and safety department
the procedure for prohibiting the placing of orders
with suppliers that have not been successfully
vetted remains in place 
john fitzgerald and mark parker are responsible
for health and safety in each of the operating
divisions and john fitzgerald remains the board
member with overall responsibility for health
and safety
i am generally satisfied with the high health and
safety standards across the group but i am also
consciously aware that we cannot rest on our
laurels my primary role is to continually drive up
the health and safety standards at telford homes
by expecting the very best from all individuals
and therefore by inference i am never completely
satisfied i remain confident that we not only
have the right procedures in place but more
importantly have the right people to deliver the
results we expect
steve nicoll
group health  safety manager
telford homes plc 2009 32
corporate responsibility
telford ra text  15609  1804  page 31 greenwich creekside greenwich
some of the things we are doing
• biomass boilers installed to act as the primary source of power to the
development supported by gas boilers
• constructing a sustainable water drainage and storage system
• an energy efficient building envelope with high uvalues and air tightness
• use of modern construction techniques that maximise off site production
and minimise waste
• a ‘brown’ roof to protect the natural habitat of the indigenous wildlife
• ‘sky gardens’ to allow for planted amenity spaces between floors
• provision of facilities for recycling
• provision of over 300 cycle spaces on the development
• designed to meet the code for sustainable homes level 3
telford homes is committed to designing and
constructing developments that both minimise
ecological impact and improve energy efficiency
the group 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 
the majority of our sites benefit from low energy
lighting methods of reducing internal water
usage including flow restrictors and dual flushes
recycling cycle storage and local transport links
in addition there are several initiatives on specific
developments including biomass boilers fuelled 
by wood pellets solar thermal tubes and panels
wind turbines air source heat pumps and ‘brown’
and ‘green’ roofs along with bird and bat boxes
33     telford homes plc 2009
casestudy  greenwich creekside
environment and sustainability
telford ra text  15609  1804  page 32 avantgarde bethnal green road e1
some of the things we are doing
• a combined heat and power plant to create electricity on site
• waste energy from the heat and power plant used alongside biomass boilers to
provide heat and hot water for the development
• use of modern construction techniques that maximise off site production and
minimise waste
• wind turbines fixed to the roof to provide additional power from renewable sources
• water attenuation to rationalise the discharge of water from the site
• a ‘green’ roof to protect the natural habitat of indigenous flora and fauna
• provision of facilities for recycling
• provision of ‘home user guides’ to ensure homeowners are aware of all
environmental features in the property and make the best use of them
telford homes plc 2009 34
casestudy  avantgarde
corporate responsibility
one of the most significant contributions that 
we can make to reduce our impact on the
environment is by improving our efficiency on
site and reducing the amount of waste that 
we generate where waste is unavoidable 
we endeavour to recycle and reuse it in our
projects before sending it off to landfill the site
waste management plan regulations 2008
which came into force on the 1st april 2008
signified a stepped change in how waste is
managed in the industry each site now requires 
a site waste management plan to be in place
detailing measures as to how it intends to
manage its waste as part of our overall plan for
the group we have engaged the services of
two waste transfer stations that provide skips for
our sites and both are achieving recycling results
of around 75 to 80 per cent of the total waste
removed from our sites
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 research sustainable
energy solutions to ensure the best technologies
are used and that we are positively contributing
towards a greener future
telford ra text  15609  1804  page 33 35     telford homes plc 2009
regeneration
kira building e3
telford ra text  15609  1804  page 34 the regeneration of east london is an ongoing
project in which telford homes is playing a major
role this process is raising the quality of life for
local people both by improving neighbourhoods
and through the provision of new affordable
housing with our housing association partners 
telford homes has been chosen to be the
development partner of eastend homes and poplar
harca both are housing transfer organisations and
significant land owners in east london our
approach to regeneration partnerships is based 
on trust an open book methodology and shared
objectives together with excellent delivery from
telford homes
the british estate e3 has set the model for the
partnership with eastend homes where land
payments made by telford homes have been
reinvested into the third party refurbishment of
existing homes on the estate telford homes has
completed the construction of 122 open market
homes on four sites across the estate with one
of these the kira building incorporating a new
tesco store the refurbishment works are well
progressed and along with the new development
this is making a significant difference to the
appearance of the estate and the quality of
the existing homes 
telford homes has now entered into a contract to
build 54 affordable homes on the st george’s estate
e1 for eastend homes along with infrastructure
works required on the estate in addition the
group expects to construct 139 open market
homes on the estate commencing in 2010
telford homes is continuing to progress master
plans for the regeneration of five other estates
with eastend homes and we expect to commence
construction on the bede estate e3 in
autumn 2009 
bede and the other estates are expected to
add in excess of 900 properties to the group’s
development pipeline over the next few years
and the partnership with poplar harca an
additional 400 properties
telford homes plc 2009 36
corporate responsibility
st george’s e1
telford ra text  15609  1804  page 35 telford ra text  15609  1804  page 36 corporate governance
relationships
telford ra text  15609  1804  page 37 david holland nonexecutive chairman 68
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 52
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
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 47
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 david’s role is focused on major planning consents product design and maintaining
key partnerships 
jonathan distefano ma econ aca financial director 34
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 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 telford homes
james furlong land director 73
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 
sheena ellwood ba hons dip int marketing sales  marketing director 50
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 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
39     telford homes plc 2009
directors and advisors
telford ra text  15609  1804  page 38 robert clarke fca nonexecutive director 66
robert clarke was a partner in binder hamlyn and subsequently arthur andersen until his retirement
in 2000 he is currently deputy chairman of ro group robert joined telford homes plc as a non
executive 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 38
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 is the director with responsibility for health and safety
mark parker joint group managing director 46
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
telford homes plc 2009 40
corporate governance
company secretary
sara debenham
registered number
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
telford ra text  15609  1804  page 39 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 its 2006 revised version applicable to fully listed companies
in formulating and applying the group’s corporate governance policies these policies are monitored to
ensure that they are appropriate to the group’s circumstances and comply as far as possible with the
provisions of the code given the size of the group 
directors
the company and group are 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 group 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 group 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 the 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 candidate’s skills and suitability for the role new directors
are given a full induction to the group 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 group’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 43 to 44
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 non
executive 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 group and remain objective and independent and to consider from time to time the need for an
internal audit function
41     telford homes plc 2009
policy on corporate governance
telford ra text  15609  1804  page 40 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 group’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
group’s significant risks and that it has been in place for the period ended 31st march 2009 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
group operating within a clearly defined departmental structure the board regularly reviews the
internal control procedures in the light of the ongoing assessment of the group’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 group’s
assets are safeguarded and financial information and accounting records can be relied upon the board
formally monitors monthly progress on each development
telford homes plc 2009 42
corporate governance
telford ra text  15609  1804  page 41 the directors present the remuneration report for the year ended 31st march 2009
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 group’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 group 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 personal pension
scheme they are entitled to participate in the sip 
service contracts
the executive directors have service contracts that can be terminated on twelve months notice these
provide for termination payments equivalent to twelve 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 2009 are as follows
salary benefits pension total total
and fees bonus in kind contributions 2009 2008
andrew wiseman 145000  22741 14500 182241 230842
robert clarke 42000    42000 37500
david durant 130000  13394 13000 156394 216829
jonathan distefano 130000  23275 13000 166275 211152
sheena ellwood 130000  24688 13000 167688 211366
john fitzgerald 130000  23865 13000 166865 160426
james furlong 101750  36752  138502 207498
david holland 55000    55000 50000
mark parker 130000  26902 13000 169902 162795
total 993750  171617 79500 1244867 1488408
john fitzgerald and mark parker were appointed as directors on 1st august 2007 
43     telford homes plc 2009
directors’ remuneration report
telford ra text  15609  1804  page 42 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 2009 and the movements during the year then
ended were as follows
company 31st march granted exercised 31st march exercise dates
scheme 2008 in year in year 2009 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 unapproved 50542   50542 1385p 17 may 2008 to 17 may 2015
approved 21660   21660 1385p 17 may 2008 to 17 may 2015
in total the sharebased payments charge in respect of directors’ share options was £7733 2008  £5772
by order of the board
david holland
chairman of the remuneration committee
26th may 2009
telford homes plc 2009 44
corporate governance
telford ra text  15609  1804  page 43 the directors present their report and the audited financial statements for the year ended 31st march 2009
review of activities
the principal activity of the group is that of property development
a review of the activities and prospects of the group is given in the chairman’s statement the chief
executive’s review and the financial review on pages 5 to 20 the group 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 1
results and dividends
profit after income tax for the year ended 31st march 2009 was £3023000 2008 restated  £4497000
no interim dividend was paid in respect of the year ended 31st march 2009 and the directors
recommend that no final dividend be paid the total dividend paid in respect of the year ended 31st
march 2008 was 100p
going concern
the group’s business activities together with factors likely to affect its future development and performance
are set out in the chairman’s statement and the chief executive’s review on pages 5 to 14 and the key risks
and uncertainties affecting the group are set out on pages 27 to 28 the financial position of the group its
cash flows and borrowing facilities are described in the financial review on pages 15 to 20 in addition note 
20 to the financial statements includes details of the group’s financial instruments and its exposure to credit
risk and liquidity risk
the directors have assessed the group’s projected business activities and available financial resources
together with detailed forecasts for cash flow and relevant sensitivity analysis the directors believe
that the group is well placed to manage its business risks successfully despite the current uncertain
market outlook
after making appropriate enquiries the directors have a reasonable expectation that the company
and the group have adequate resources to continue in operational existence for the foreseeable
future accordingly the directors continue to adopt the going concern basis in preparing the annual
report and accounts
substantial shareholdings
as at 15th may 2009 the company had been advised of the following notifiable interests in its ordinary
share capital
number percentage
held
artemis investment management ltd 3240960 836
midas capital plc 2372500 612
k p furlong 1966000 507
telford homes trustees limited 1900557 490
t d waterhouse nom r stokes 1607760 415
rathbone brothers plc 1580875 408
m trim 1409000 364
d g furlong 1300000 335
the shares held by telford homes trustees limited include shares held on behalf of employees under
the share incentive plan note 17
45     telford homes plc 2009
report of the directors
telford ra text  15609  1804  page 44 directors
details of the directors of the company are shown on pages 39 to 40
andrew wiseman david durant and sheena ellwood retire by rotation at the next annual general
meeting and being eligible offer themselves for reelection 
directors’ interests
the directors of the company are listed below together with their interest in the shares of the
company at 31st march 2009 and movements in the year
at 31st share market at 31st
march 2008 incentive acquisitions march 2009
plan and disposals
number number number number
andrew wiseman 2210564 11320 20000 2241884
robert clarke 111213 11320  122533
jonathan distefano 332213 11320  343533
david durant 1066213 11320 60000 1137533
sheena ellwood 336481 11320  347801
john fitzgerald 193259 11320  204579
james furlong 1124973 11320 120000 1256293
david holland 981213 11320  992533
mark parker 155888 11320  167208
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 43 to 44
investment in own shares
the company’s investment in own shares relates solely to the share incentive plan and further details
of the total holding and movements in the holding are disclosed in note 17
creditors
it is group 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 2009 trade payables represented 22 days purchases 2008 – 14 days
telford homes plc 2009 46
corporate governance
telford ra text  15609  1804  page 45 employees
the group 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 group made charitable donations of £15000 2008  £17000 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 9th july 2009 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
sara debenham
company secretary
26th may 2009
47     telford homes plc 2009
report of the directors
telford ra text  15609  1804  page 46 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 group and of the profit or loss 
of the group 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 group 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 group and enable them to ensure that the financial
statements comply with the companies act 1985 they are also responsible for safeguarding the assets
of the group and hence for taking reasonable steps for the prevention and detection of fraud and
other irregularities
the directors are responsible for the maintenance and integrity of the group’s website legislation in
the united kingdom governing the preparation and dissemination of financial statements may differ
from legislation in other jurisdictions
telford homes plc 2009 48
corporate governance
statement of directors’ responsibilities
telford ra text  15609  1804  page 47 independent auditors’ report to the members of telford homes plc
we have audited the group and parent company financial statements the ‘‘financial statements’’ of
telford homes plc for the year ended 31st march 2009 which comprise the group income statement the
group and parent company balance sheets the group and parent company cash flow statements the
group and parent company statements of changes in equity the statement of accounting policies and the
related notes these financial statements have been prepared under the accounting policies set out therein 
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 ifrss 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 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
chairman’s statement the chief executive’s review and the financial review that are cross referred
from the business review 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 the area of operation the operational
structure the key risks and uncertainties health and safety environment and sustainability regeneration
the directors and advisors the policy on corporate governance the directors’ remuneration report and
the report of the directors and the statement of directors’ responsibilities 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
49     telford homes plc 2009
auditors’ report
telford ra text  15609  1804  page 48 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 judgments made by the directors in the preparation of the financial statements and of
whether the accounting policies are appropriate to the group’s and 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 group financial statements give a true and fair view in accordance with ifrss as adopted by
the european union of the state of the group’s affairs as at 31st march 2009 and of the group’s
profit and cash flows for the year then ended
• the parent company financial statements give a true and fair view in accordance with ifrss as
adopted by the european union as applied in accordance with the provisions of the companies
act 1985 of the state of the parent company’s affairs as at 31st march 2009 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
26th may 2009
notes
a the maintenance and integrity of the telford homes plc website is the responsibility of the
directors the work carried out by the auditors does not involve consideration of these matters
and accordingly the auditors accept no responsibility for any changes that may have occurred
to the financial statements since they were initially presented on the website
b legislation in the united kingdom governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions
telford homes plc 2009 50
corporate governance
telford ra text  15609  1804  page 49 telford ra text  15609  1804  page 50 financial statements
results
telford ra text  15609  1804  page 51 note year ended year ended
31st march 2009 31st march 2008
restated
£000 £000
revenue 106662 96777
cost of sales before exceptional items 89044 79756
exceptional items 2868 
gross profit 14750 17021
administrative expenses 7971 8253
selling expenses 1373 2340
exceptional items 116 
operating profit 1 5290 6428
finance income 3 216 493
finance costs 3 1163 379
profit before income tax 4343 6542
analysed as
profit before income tax and exceptional items 7327 6542
exceptional items 1 2984 
4343 6542
income tax expense 4 1320 2045
profit after income tax 3023 4497
earnings per share
basic 6 81p 122p
diluted 6 81p 121p
all activities are in respect of continuing operations
53     telford homes plc 2009
group income statement
31st march 2009
telford ra text  15609  1804  page 52 group group company company
note 31st march 31st march 31st march 31st march
2009 2008 2009 2008
restated restated
£000 £000 £000 £000
non current assets
investments 7   4 1
property plant and equipment 8 618 907 618 907
deferred income tax assets 13 13  13 
631 907 635 908
current assets
inventories 9 177941 179113 142242 148988
trade and other receivables 10 9098 12631 15264 19356
current income tax assets 342 4624 525 4971
cash and cash equivalents 11 4865 4698 4329 2464
192246 201066 162360 175779
total assets 192877 201973 162995 176687
non current liabilities
hire purchase liabilities 12  18  18
deferred income tax liabilities 13  4  4
 22  22
current liabilities
trade and other payables 14 30534 51591 28270 49541
borrowings 15 112020 101424 88086 81770
hire purchase liabilities 12 18 83 18 83
142572 153098 116374 131394
total liabilities 142572 153120 116374 131416
net assets 50305 48853 46621 45271
capital and reserves
issued share capital 16 3875 3750 3875 3750
share premium 30345 29749 30345 29749
retained earnings 16085 15354 12401 11772
total equity 50305 48853 46621 45271
these financial statements were authorised for issue by the board of directors on 26th may 2009 and
signed on its behalf by
andrew wiseman jonathan distefano
chief executive financial director
telford homes plc 2009 54
financial statements
balance sheet
31st march 2009
telford ra text  15609  1804  page 53 statement of changes in equity
55     telford homes plc 2009
group statement of changes in equity share share retained total
capital premium earnings equity
£000 £000 £000 £000
balance previously reported at 31st march 2007 3694 28641 22496 54831
restatement   7564 7564
restated balance at 31st march 2007 3694 28641 14932 47267
profit for the year   4497 4497
dividend on equity shares   3498 3498
movement in excess tax on share options   194 194
shares issued under deferred payment 16 374 390 
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 down in value of own shares   109 109
balance at 31st march 2008 3750 29749 15354 48853
profit for the year   3023 3023
dividend on equity shares   2061 2061
movement in excess tax on share options   30 30
proceeds of equity share issue 125 596  721
sharebased payments   195 195
purchase of own shares   721 721
sale of own shares   194 194
movement arising from write down in value of own shares   131 131
balance at 31st march 2009 3875 30345 16085 50305
company statement of changes in equity share share retained total
capital premium earnings equity
£000 £000 £000 £000
balance previously reported at 31st march 2007 3694 28641 20556 52891
restatement 58595859
restated balance at 31st march 2007 3694 28641 14697 47032
profit for the year   1150 1150
dividend on equity shares   3498 3498
movement in excess tax on share options   194 194
shares issued under deferred payment 16 374 390 
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 down in value of own shares   109 109
balance at 31st march 2008 3750 29749 11772 45271
profit for the year   2921 2921
dividend on equity shares   2061 2061
movement in excess tax on share options   30 30
proceeds of equity share issue 125 596  721
sharebased payments   195 195
purchase of own shares   721 721
sale of own shares   194 194
movement arising from write down in value of own shares   131 131
balance at 31st march 2009 3875 30345 12401 46621
31st march 2009
telford ra text  15609  1804  page 54 financial statements
cash flow statement
telford homes plc 2009 56
group group company company
year ended year ended year ended year ended
31st march 31st march 31st march 31st march
2009 2008 2009 2008
restated restated
£000 £000 £000 £000
cash flow from operating activities
operating profit 5290 6428 4641 1953
depreciation 387 399 387 399
write down in value of own shares 131 109 131 109
sharebased payments 195 109 195 109
profit on sale of tangible assets 39 24 39 24
decrease increase in inventories 6427 50104 11218 47598
decrease increase in receivables 3533 10682 4092 10806
decrease increase in payables 21050 27938 21358 28230
5126 25827 733 27628
interest paid 6425 7400 5139 5752
income tax received paid 2915 5048 3228 4155
cash flow from operating activities 8636 38275 2644 37535
cash flow from investing activities
purchase of tangible assets 99 332 99 332
proceeds from sale of tangible assets 40 24 40 24
interest received 216 493 202 477
cash flow from investing activities 157 185 143 169
cash flow from financing activities
proceeds from issuance of ordinary share capital 721 774 721 774
purchase of own shares 721 422 721 422
sale of own shares 194 211 194 211
increase in bank loans 52774 59825 46494 45944
repayment of bank loans 42178 31611 40178 20495
dividend paid 2061 3498 2061 3498
capital element of hire purchase payments 83 108 83 108
cash flow from financing activities 8646 25171 4366 22406
net increase decrease in cash and 167 12919 1865 14960
cash equivalents
cash and cash equivalents brought forward 4698 17617 2464 17424
cash and cash equivalents carried forward 4865 4698 4329 2464
31st march 2009
telford ra text  15609  1804  page 55 statement of accounting policies
57     telford homes plc 2009
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 
the financial statements have been prepared under the historical cost convention
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 accounting policies set out below have been applied consistently for all periods presented in
these financial statements except where the group has taken the option to early adopt ifric 15
agreements for the construction of real estate and ias 23 revised borrowing costs from 1st april
2008 the prior year comparatives have been restated and further information is given in note 21
basis of consolidation
the consolidated financial statements include the financial statements of the company its
subsidiaries and the groups share of jointly controlled entities up to 31st march 2009 the results of
subsidiaries acquired or disposed of during the year are included in the financial statements from the
effective date of acquisition or up to the effective date of disposal as appropriate all intragroup
transactions balances income and expenses are eliminated on consolidation
exemptions
the directors have taken advantage of the exemption available under section 230 of the companies
act 1985 and have not presented an income statement for the company alone
jointly controlled entities
a jointly controlled entity is an entity in which the group 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
segmental reporting
the group has only one business segment being housebuilding and one geographical segment being
the united kingdom
revenue and profit recognition
properties for open market sale
revenue and profit is recognised at the point of legal completion of each property
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 selling expenses
construction contracts
contracts are treated as construction contracts when they have been specifically negotiated for the
construction of a development or a number of properties these contracts are primarily for the
construction of affordable homes revenue is only recognised on a construction contract where the
outcome can be estimated reliably revenue and costs are recognised by reference to the stage of
completion of contract activity at the balance sheet date this is normally measured by an
assessment of work performed to date
where the outcome of a construction contract cannot be estimated reliably contract revenue is
recognised to the extent of contract costs incurred that it is probable will be recoverable when it is
probable that total contract costs will exceed total contract revenue the expected loss is recognised
as an expense immediately
selling expenses
selling expenses are charged to the income statement as incurred
borrowings
interest bearing bank loans and overdrafts are recorded at the proceeds received
borrowing costs directly attributable to the development of properties that take a substantial period
of time to get ready for sale are capitalised within inventories capitalisation of borrowing costs
commences from the date of initial expenditure on a given development and continues until the
properties are ready for sale 
31st march 2009
telford ra text  15609  1804  page 56 financial statements
the capitalisation of borrowing costs is suspended where land assets are being held for strategic
purposes or where there are prolonged periods when development activity on a site is interrupted
capitalisation is not normally suspended during a period when substantial technical and
administrative work is being carried out
all other borrowing costs are charged to the income statement using the effective interest method
exceptional items
exceptional items are those significant items which are separately disclosed by virtue of their size or
incidence to enable a full understanding of the groups financial performance
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 group
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
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
investments
interests in subsidiary undertakings are valued at cost less impairment 
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 direct labour costs and borrowing costs net realisable value has been assessed
for all developments and during the year this assessment led to a write down in the value of land and
work in progress as disclosed in note 1 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 groups balance sheet when the group
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 short
term 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
trade payables
trade payables on normal terms are not interest bearing and are stated at their nominal value
telford homes plc 2009 58
telford ra text  15609  1804  page 57 59     telford homes plc 2009
land creditors
when land is purchased on extended payment terms the group 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 group after deducting all of its liabilities equity instruments issued by the group are
recorded at the proceeds received net of direct issue costs
current assets and liabilities
assets that are expected to be realised in or are intended for sale or consumption in the groups
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
groups 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 its 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
groups liability for current tax is calculated using tax rates that have been enacted or substantively
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 in 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 share
based 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 groups 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
construction contract revenue and profit recognition
contract revenue is recognised from the date of exchange of construction contracts at a rate
equivalent to the value of work undertaken in respect of land development contract profit on
construction contracts is recognised in proportion to revenue only to the extent that the total
eventual profit on the contract can be foreseen with reasonable certainty
statement of accounting policies
31st march 2009
telford ra text  15609  1804  page 58 financial statements
telford homes plc 2009 60
assessing the percentage complete on each contract involves estimation of total expected costs 
to be incurred until the end of the contract recognition of profit also involves estimation of the 
total expected revenues from each contract and therefore the expected profit margin that will be
achieved judgement is required to assess whether the total eventual profit on each contract 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
during the year amendments to ias 39 ifrs 7 and ifric 12 have become effective none of which
are applicable to the group
at the date of the authorisation of these financial statements there are a number of standards
amendments and interpretations that have been published 
the standards amendments and interpretations that are expected to impact upon the group are
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 it will apply to the group from the annual period commencing 1st april 2009
ifrs 2 amendment sharebased payment 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 group 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 group
ifrs 3 amendment business combinations applies to the group 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 7 amendment financial instruments disclosures this amendment increases the disclosure
requirements for fair value measurement it will apply to the group from the annual period
commencing 1st april 2009
ifrs 8 operating segments applies to the group 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 group 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 group from the annual period commencing 1st april 2009
ias 39 amendment financial instruments recognition and measurement  eligible hedged items’
applies to the group from the 1st april 2010
ifric 13 customer loyalty programmes applicable to the group from the annual period
commencing 1st april 2009
ifric 16 hedges of a net investment in a foreign operation applicable to the group from the annual
period commencing 1st april 2009
ifric 17 distributions of noncash assets to owners applicable to the group from the annual period
commencing 1st april 2010
ifric 18 transfer of assets from customers applicable to the group from the annual period
commencing 1st april 2010
telford ra text  15609  1804  page 59 notes to the financial statements
61     telford homes plc 2009
1 operating profit year ended year ended
31st march 2009 31st march 2008
restated 
£000 £000
operating profit is stated after charging crediting
depreciation  owned assets 302 271
 hire purchase assets 85 128
operating lease rentals  property 163 162
 motor vehicles 387 216
profit on sale of tangible assets 39 24
exceptional items 2984 
the exceptional items for the year ended 31st march 2009 of £30 million include £29 million where
the net realisable value of land and work in progress on certain developments has been assessed to
be lower than the costs originally recorded in inventories as a result of the deterioration in market
conditions and £01 million of redundancy costs
year ended year ended
31st march 2009 31st march 2008
£000 £000
the following has been charged in respect of auditors’ remuneration
audit and related services pricewaterhousecoopers llp
statutory audit of the parent company and group financial statements 65 59
other services including nonaudit services pricewaterhousecoopers llp
the audit of jointly controlled entity accounts pursuant to legislation 8 7
other services provided pursuant to such legislation  
other services relating to taxation 52 23
all other services 27 21
amounts payable to the company’s auditors and their associates in respect of services to the
company other than the audit of the company’s financial statements have not been disclosed as
the information is required instead to be disclosed on a consolidated basis
31st march 2009
telford ra text  15609  1804  page 60 financial statements
telford homes plc 2009 62
2 employee benefit expense
the average monthly number of persons employed by the group and company including executive
directors during the year analysed by activity was as follows
year ended year ended
31st march 2009 31st march 2008
number number
construction 100 88
administration 73 62
173 150
the employment costs of all employees included above were
year ended year ended
31st march 2009 31st march 2008
£000 £000
wages and salaries 7945 8045
social security costs 870 901
other pension costs  group personal pension arrangements 395 324
9210 9270
the company operates a group personal pension scheme for its employees at 31st march 2009
payments of £43000 were due to the scheme 2008  £47000
six current directors are accruing benefits under group personal pension arrangements 2008  six
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 
year ended year ended
31st march 2009 31st march 2008
£000 £000
wages and salaries including bonuses 1165 1516
social security costs 109 152
other pension costs 79 73
sharebased payments 8 6
1361 1747
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 43 to 44
telford ra text  15609  1804  page 61 63     telford homes plc 2009
3 finance income and costs year ended year ended
31st march 2009 31st march 2008
restated
£000 £000
finance income 
interest income on shortterm bank deposits 216 493
finance costs
interest payable on bank loans and overdrafts 1159 367
hire purchase finance charges 4 12
1163 379
net finance costs 947 114
4 taxation year ended year ended
31st march 2009 31st march 2008
restated
£000 £000
united kingdom corporation tax at a rate of 28 2008  30 1313 1924
adjustment in respect of prior periods 54 85
total current taxation 1367 2009
deferred taxation note 13 47 36
income tax expense 1320 2045
in addition to the amount charged to the income statement deferred tax of £30000 2008  £194000
relating to sharebased payments was charged directly to equity
the changes in accounting policies implemented in the current year have resulted in an income tax
asset of £342000 2008  £4624000 which is recovered either through repayments or a reduction in
future tax due
reconciliation of effective tax rate
the tax assessed for the year is higher 2008  higher than the standard rate of corporation tax in the
uk of 28 2008  30 the differences are explained below
profit before income tax 4343 6542
profit before income tax at standard rate of 1216 1963
corporation tax in the uk of 28 2008  30
effects of
adjustment in respect of prior periods 54 85
expenses not deductible for tax purposes 123 38
tax relief on land remediation costs 73 41
income tax expense 1320 2045
the uk corporation tax rate changed from 30 to 28 with effect from 1st april 2008 all deferred tax
assets and liabilities are now recognised at 28
notes to the financial statements
31st march 2009
telford ra text  15609  1804  page 62 financial statements
telford homes plc 2009 64
5 dividend paid year ended year ended
31st march 2009 31st march 2008
£000 £000
prior year final dividend paid in july 2008 of 55p july 2007  49p 2061 1818
interim dividend paid in january 2009 of nil january 2008  45p  1680
2061 3498
the directors are not recommending payment of a final dividend for the year ended 31st march 2009
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 2009 31st march 2008
restated
weighted average number of shares in issue 37381374 36971367
dilution  effect of share schemes  318266
diluted weighted average number of shares in issue 37381374 37289633
profit from continuing operations after tax £3023000 £4497000
earnings per share
basic 81p 122p
diluted 81p 121p
telford ra text  15609  1804  page 63 65     telford homes plc 2009
7 investments
investments in subsidiary undertakings 2009 2008
£000 £000
cost 
at 1st april  
additions 3 
at 31st march 3 
investments in jointly controlled entities 2009 2008
£000 £000
cost 
at 1st april 1 1
additions 
at 31st march 1 1
investments in subsidiary undertakings
the subsidiary undertakings which principally affect profits and net assets of the group comprise
share of ordinary
capital held by country of accounting principal
the group registration date activity
telford homes romford limited 100 england 31st march property development
telford homes properties limited 100 england 31st march property development
telford homes investments limited 100 england 31st march property development
during the year the group acquired 100 of the issued share capital of telford homes romford
limited telford homes properties limited and telford homes investments limited for a total
consideration of £1000 each
a full list of subsidiary undertakings is available on request from the groups registered office
investments in jointly controlled entities
the group’s investments in jointly controlled entities comprise
share of ordinary
capital held by country of accounting principal
the group registration date activity
telford homes stratford limited 50 scotland 31st march property development
telford homes creekside limited 50 scotland 31st march property development
bishopsgate apartments llp 50 england 31st march property development
investments in jointly controlled entities are accounted for using proportional consolidation
notes to the financial statements
31st march 2009
telford ra text  15609  1804  page 64 financial statements
telford homes plc 2009 66
the group’s share of the assets and liabilities and the income and expenses of jointly controlled
entities is as follows
31st march 31st march
2009 2008
£000 £000
current assets 37376 34658
current liabilities 33651 31076
net assets of jointly controlled entities 3725 3582
income 6003 23443
expenses 5860 20096
share of results of jointly controlled entities 143 3347
8 property plant and equipment
group and company leasehold plant and motor
improvements machinery vehicles total
£000 £000 £000 £000
cost
at 1st april 2007 restated 261 1112 496 1869
additions 1 328  329
disposals  284 91 375
at 31st march 2008 restated 262 1156 405 1823
additions  99  99
disposals  141 147 288
at 31st march 2009 262 1114 258 1634
depreciation
at 1st april 2007 restated 31 617 244 892
charge 27 244 128 399
disposals  284 91 375
at 31st march 2008 restated 58 577 281 916
charge 26 276 85 387
disposals  140 147 287
at 31st march 2009 84 713 219 1016
net book value
at 31st march 2008 restated 204 579 124 907
at 31st march 2009 178 401 39 618
motor vehicles with a net book value of £39000 are held under hire purchase arrangements 2008 
£124000 depreciation of £85000 was charged during the year on these assets 2008  £128000
authorised future capital expenditure that was contracted but not provided for in these financial
statements amounted to £nil 2008  £nil
telford ra text  15609  1804  page 65 67     telford homes plc 2009
9 inventories group group company company
31st march 31st march 31st march 31st march
2009 2008 2009 2008
restated restated
£000 £000 £000 £000
development properties 177941 179113 142242 148988
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 for the group and company are freehold interests held for
future sale of £3676000 2008  £2850000
the value of inventories expensed in cost of sales in 2009 was £88111000 2008  £78599000 costs
capitalised during the year include interest of £5255000 2008  £7757000 which is capitalised
based on the cost of the site specific borrowings
during the year the group conducted a review of the net realisable value of its inventories in light of
the deterioration in the uk housing market where the estimated net realisable value was less than its
carrying value within the balance sheet the group has written down the value of inventories the
total amount recognised as an expense within exceptional items was £2868000
notes to the financial statements
31st march 2009
telford ra text  15609  1804  page 66 financial statements
telford homes plc 2009 68
10 trade and other receivables group group company company
31st march 31st march 31st march 31st march
2009 2008 2009 2008
restated restated
£000 £000 £000 £000
current receivables
amounts recoverable on contracts 7701 9987 4671 6530
amounts owed by group undertakings   826 
amounts owed by jointly controlled entities 351 1192 8735 11508
trade receivables 76 43 76 43
other receivables 428 686 414 552
prepayments and accrued income 542 723 542 723
9098 12631 15264 19356
amounts recoverable on contracts
contract revenue of £22237000 2008  £31053000 has been recognised by the group in the year
in relation to contracts in progress at the balance sheet date
group group company company
31st march 31st march 31st march 31st march
2009 2008 2009 2008
restated restated
£000 £000 £000 £000
contracts where costs incurred plus recognised profits 7701 9987 4671 6530
exceed payments to date included in receivables
contracts where payments to date exceed costs 3425 1319 905 1319
incurred plus recognised profits included in payables
4276 8668 3766 5211
total costs incurred plus recognised 78438 68372 65490 57047
profits on contracts
payments to date 74162 59704 61724 51836
4276 8668 3766 5211
at 31st march 2009 retentions held by customers for contract work performed by the group
amounted to £1126000 2008  £947000
11 cash and cash equivalents group group company company
31st march 31st march 31st march 31st march
2009 2008 2009 2008
£000 £000 £000 £000
cash at bank and in hand 4865 4698 4329 2464
telford ra text  15609  1804  page 67 69     telford homes plc 2009
12 hire purchase liabilities
group and company 31st march 31st march
2009 2008
£000 £000
gross hire purchase liabilities
due within one year 19 87
due in more than one year and less than five years  18
19 105
less future interest 1 4
net hire purchase liabilities 18 101
net hire purchase liabilities are repayable as follows
due within one year 18 83
due in more than one year and less than five years  18
18 101
13 deferred income tax
group and company 31st march 31st march
2009 2008
£000 £000
deferred tax assets 69 76
deferred tax liabilities 56 80
deferred tax assets liabilities 13 4
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 31st march
2009 2008
£000 £000
brought forward 4 226
credited charged to the income statement 47 36
charged directly to equity 30 194
13 4
the movement in deferred tax assets and liabilities during the year is as follows
capital sharebased land remediation total
allowances transactions timing differences
£000 £000 £000 £000
at 1st april 2007 51 296 121 226
credited charged to the income statement 8 85 41 36
charged directly to equity  194  194
at 31st march 2008 59 17 80 4
credited charged to the income statement 10 36 73 47
charged directly to equity  30  30
at 31st march 2009 69 49 7 13
the aggregate deferred tax credited directly to equity amounts to £nil 2008  £30000
notes to the financial statements
31st march 2009
telford ra text  15609  1804  page 68 financial statements
telford homes plc 2009 70
14 trade and other payables group group company company
31st march 31st march 31st march 31st march
2009 2008 2009 2008
restated restated
£000 £000 £000 £000
trade payables 8573 8126 8573 7978
amounts due to jointly controlled entities 6  1953 
amounts recoverable on contracts 3425 1319 905 1319
deposits received in advance 10792 17879 10575 17489
social security and other taxes 309 329 309 329
accrued expenses 4833 10242 3359 8730
land creditors 2596 13696 2596 13696
30534 51591 28270 49541
15 borrowings group group company company
31st march 31st march 31st march 31st march
2009 2008 2009 2008
£000 £000 £000 £000
bank loans 112020 101424 88086 81770 
further information on bank loans is given in note 20
16 share capital
group and company 31st march 31st march
2009 2008
£000 £000
authorised
100000000 ordinary shares of 10p each 10000 10000
allotted called up and fully paid
38750000 ordinary shares of 10p each 2008  37500000 3875 3750
on 5th august 2008 500000 ordinary shares were issued at 1045p to telford homes trustees limited to
satisfy the requirements of the share incentive plan note 17
on 23rd march 2009 750000 ordinary shares were issued at 265p 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
telford ra text  15609  1804  page 69 71     telford homes plc 2009
17 employee share schemes
telford homes plc employee share option scheme
the group 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 group 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
2009 2008
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 46 2530
dividend yield 5 36
risk free interest rate 5 525575
weighted average share price at date of grant 110p 231p
weighted average exercise price 110p 231p
weighted average fair value per option £032 £042
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 2009 was £195000 2008  £109000
a reconciliation of option movements during each period is shown below
number weighted average number weighted average
000s exercise price 000s exercise price
2009 2009 2008 2008
outstanding at 1st april 2147 173p 1488 147p
granted in the year 409 110p 1330 231p
forfeited in the year 312 185p 399 285p
exercised in the year   272 143p
outstanding at 31st march 2244 161p 2147 173p
exercisable at 31st march 833 119p 434 90p
the aggregate fair value of options granted in the year was £122000 2008  £388000
the weighted average share price at the point of exercise of share options during the year ended
31st march 2008 was 2825p no share options were exercised in the year ended 31st march 2009

notes to the financial statements
31st march 2009
telford ra text  15609  1804  page 70 financial statements
telford homes plc 2009 72
at 31st march 2009 outstanding options granted over 10p ordinary shares were as follows
share option scheme option price number dates exercisable
group approved 1435p 20905 5 aug 2007 to 5 aug 2014
1445p 83044 6 jan 2008 to 6 jan 2015
1385p 86640 17 may 2008 to 17 may 2015
1535p 175887 10 nov 2008 to 10 nov 2015
167p 35928 27 feb 2009 to 27 feb 2016
205p 87804 15 june 2009 to 15 june 2016
2135p 941417 14 feb 2011 to 14 feb 2018
110p 381808 12 june 2011 to 12 june 2018
group 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 group 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 group 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 group 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 group and is managed by a corporate
trustee telford homes trustees limited the costs associated with the trust are paid for by the group
and the group 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 2009 is
£131000 2008  £109000
during the year ended 31st march 2009 the trust acquired 292 shares at 980p in august 2008 a further
500000 shares at 1045p in august 2008 and a further 750000 shares at 265p in march 2009 at 31st
march 2009 the trust remains interested in 27242 shares 2008  7343 which have not been allocated
to employees and a further 731913 2008  217489 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 numbers 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 2009 was £700126 2008  £305000 movements in the profit and loss reserve
relating to the sip are shown in the statement of changes in equity
telford ra text  15609  1804  page 71 73     telford homes plc 2009
17 employee share schemes continued
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 group at market value this loan is interest free 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 a limited recourse such that repayment is limited to the value of the
shares on the repayment date the group 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 group 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 group 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
18 commitments and contingent liabilities
commitments
at 31st march the group and company had outstanding commitments for future minimum lease
payments under noncancellable operating leases which fall due as follows
property leases                    other leases
2009 2008 2009 2008
£000 £000 £000 £000
within one year 184 184 300 201
between one and five years 737 737 215 320
over five years 292 476  
1213 1397 515 521
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 2009 £229 million
2008  £139 million had been paid for the site no further liability has been accrued at 31st march
2009 2008  £73 million further payments are contingent on future sales at the development and
are estimated to be approximately £15 million 2008  £14 million
notes to the financial statements
31st march 2009
telford ra text  15609  1804  page 72 financial statements
telford homes plc 2009 74
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 group 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 group has received
deposits to the value of £26250 with the balance due on legal completion which is scheduled for
june 2009 the purchase was approved at a previous extraordinary general meeting
there have been no other transactions between key management personnel and the group apart
from that referred to above
transactions between the company and its subsidiaries which are related parties have been
eliminated on consolidation the amounts outstanding from subsidiaries to the company at 31st
march 2009 totalled £826000 2008  £nil
the company has invoiced jointly controlled entities £14334000 in the year to 31st march 2009 for
construction services 2008  £15795000
the amounts outstanding from jointly controlled entities to the company at 31st march 2009 totalled
£702000 2008  £2384000 in respect of construction services amounts owed by the company to
jointly controlled entities at the 31st march 2009 totalled £12000 2008  £nil in addition a net total of
£6092000 was owed to the company at the 31st march 2009 from jointly controlled entities in respect
of shareholder loans 2008  £9124000
after proportional consolidation of the jointly controlled entities the group has amounts outstanding
from jointly controlled entities totalling £351000 at the 31st march 2009 2008  £1192000 and
amounts owed to jointly controlled entities of £6000 2008  £nil
20 financial instruments
categories of financial assets and financial liabilities are as follows
group group company company
31st march 31st march 31st march 31st march
2009 2008 2009 2008
£000 £000 £000 £000
financial assets
loans and receivables
trade receivables 76 43 76 43
other receivables 428 686 414 552
cash and cash equivalents 4865 4698 4329 2464
5369 5427 4819 3059
financial liabilities
amortised cost
trade payables 8573 8126 8573 7978
land creditors 2596 13696 2596 13696
borrowings 112020 101424 88086 81770
hire purchase liabilities 18 101 18 101
123207 123347 99273 103545
the group does not enter into any derivative transactions and has no direct exposure to exchange
rate movements as its trade takes place entirely within the united kingdom
telford ra text  15609  1804  page 73 75     telford homes plc 2009
20 financial instruments continued
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 2009 is equal to the carrying value stated in the balance sheet at that date  hire purchase
liabilities include £nil 2008  £18000 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  recognition and measurement
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 rates used in the year to 31st march 2009 were between 3 and 6 2008  6 all land
creditors are due within one year
borrowings
the group 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 group and by charges over the development 
sites owned by the group
at 31st march 2009 the group had unutilised overdraft facilities of £30 million 2008  £30 million
the group has site specific loan facilities with allied irish bank totalling £276 million in respect of
certain development sites at 31st march 2009 the group had utilised £212 million of these facilities
leaving an unutilised balance of £64 million the facilities expire on different dates depending on the
specific circumstances of each development and are normally repayable on completion of each
development from the sales proceeds received of the utilised loans of £212 million none is due for
repayment within one year £65 million is due for repayment after more than one year and less than
two years and £147 million is due for repayment after more than two years and less than five years
in addition the group’s jointly controlled entity bishopsgate apartments llp has a loan facility with
allied irish bank of £200 million in respect of the purchase of development land in bethnal green
road at 31st march 2009 bishopsgate apartments llp had utilised all £200 million of this facility the
group has recorded its 50 share of the loan in its balance sheet at 31st march 2009 the facility is on
a rolling one year term and the bank had not served a notice to require repayment within one year
as at the date of signing the financial statements 
the group has site specific loan facilities with the royal bank of scotland totalling £663 million in
respect of certain development sites at 31st march 2009 the group had utilised £622 million of these
facilities leaving an unutilised balance of £41 million the facilities expire on different dates depending
on the specific circumstances of each development and are normally repayable on completion of
each development from the sales proceeds received of the utilised loans of £622 million £433
million is due for repayment within one year £160 million is due for repayment after more than one
year and less than two years and £29 million is due for repayment after more than two years and less
than five years
in addition the group’s jointly controlled entity telford homes creekside limited has a loan facility
with the royal bank of scotland of £513 million in respect of the purchase of development land and
construction in greenwich at 31st march 2009 telford homes creekside limited had utilised £162
million of this facility leaving an unutilised balance of £351 million the group has recorded its 50
share of the loan in its balance sheet at 31st march 2009 this facility is due for repayment in
december 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 borrowings within the accounts of telford homes creekside limited the
group has recorded its 50 share of the bill of exchange in its balance sheet at 31st march 2009
the group has site specific loan facilities with barclays bank totalling £126 million in respect of certain
development sites at 31st march 2009 the group had utilised £73 million of these facilities leaving an
notes to the financial statements
31st march 2009
telford ra text  15609  1804  page 74 financial statements
telford homes plc 2009 76
unutilised balance of £53 million the facilities are due for repayment between june 2010 and
september 2010
interest is charged on all of the groups facilities at either base rate plus a margin of between 25
and 40 or libor plus a margin of between 20 and 30 
market risk
the group 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 2009 with the impact of falling
base rates partially offset by a number of the groups facilities becoming linked to libor as they fell
due for renewal interest on all facilities currently held is charged at floating interest rates and the
group 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 £1252000 before tax 2008  £988000 a 1 fall in interest
rates gives the same but opposite effect
capital risk
the groups objectives when managing capital are to safeguard the groups ability to continue as a
going concern in order to provide returns for shareholders and meet its liabilities as they fall due whilst
maintaining an appropriate capital structure to reduce the costs of capital the group considers its
capital to be all of the components of net assets
the group ensures that there are appropriate controls over the purchase of land and levels of work in
progress in the business in order to appropriately manage its capital in addition the other methods
by which the group can manage its shortterm and longterm capital structure include adjusting the
level of ordinary dividends paid to shareholders issuing new share capital and arranging debt
credit risk
credit risk is the risk of financial loss where counterparties are not able to meet their obligations
trade and other receivables includes amounts recoverable on contracts which are due from housing
associations and balances due from other group undertakings the group 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 allied irish bank the royal bank of scotland
and barclays bank
liquidity risk
liquidity risk is the risk that the group does not have sufficient financial resources to meet its
obligations as they fall due
the group manages liquidity risk by continuously monitoring forecast and actual cash flows over a
five year period and performing sensitivity analysis on these forecasts the forecasts are necessarily
subject to a number of assumptions and judgements and these are tested on a reasonable basis by
the sensitivity analysis these forecasts and the related sensitivity analysis are reviewed by the directors
in detail on a monthly basis in addition all of the forecasts and supporting calculations are made
available to each bank funding the group on a monthly basis the current forecasts show positive
cash balances beyond the next twelve months even where this is subjected to sensitivity testing and
at no time is the group forecasting to make use of its overdraft facilities
the group utilises bank facilities to ensure that adequate funding is available to cover working capital
requirements and the directors consider that existing facilities are sufficient to cover funding requirements
in the foreseeable future both where these have already been utilised and where they are currently
unutilised where facilities are due to expire within one year this is due to the timing of the relevant
developments and therefore the expected repayment dates in all of these cases the directors are
satisfied that the loans are expected to be repaid by the date the facility expires
telford ra text  15609  1804  page 75 77     telford homes plc 2009
20 financial instruments continued
some of the groups bank facilities are subject to a number of general and financial covenants which
are tested periodically by each bank in all cases the directors have assessed whether the group will
remain in compliance with the covenants for at least twelve months after signing the financial
statements and are satisfied that there will be no breach of the covenants that cannot be easily
rectified in isolated cases it is possible that on professional valuation of the gross development value
of certain sites should these be required by the relevant bank there may be a breach of current loan
to gross development value covenants as this would be subject to a third party opinion of current
market values at any time the directors have assessed situations where this may occur on a prudent
basis and concluded that whilst it is considered extremely unlikely that any loan repayments will be
required given recent discussions with each bank necessary loan repayments to correct any such
breach could be accommodated by forecast future cash resources
the maturity profile of financial liabilities for the group is as follows
trade land borrowings net hire total
payables creditors purchase
liabilities
£000 £000 £000 £000 £000
within one year 8573 2596 43306 18 54493
more than one year and   39777  39777
less than two years
more than two years and   28937  28937
less than five years
31st march 2009 8573 2596 112020 18 123207
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
notes to the financial statements
31st march 2009
telford ra text  15609  1804  page 76 financial statements
telford homes plc 2009 78
21 early adoption of ifric 15 and ias 23 revised
ifric 15 agreements for the construction of real estate
ifric interpretation 15 ‘agreements for the construction of real estate’ was issued on 3rd july 2008
and is effective for periods beginning on or after 1st january 2009 the group has taken up the option
of adopting ifric 15 from 1st april 2008
ifric 15 has arisen due to differing opinions on whether the revenue from certain real estate
transactions should be recognised in accordance with ias 18 ‘revenue’ or in accordance with ias 
11 ‘construction contracts’ the guidance in the existing standards allows flexibility in the accounting
treatment that should be adopted
the group has historically accounted for revenues and therefore profits from all property sales in
accordance with ias 11 under ias 11 revenue is recognised on a percentage of completion basis
once contracts for the sale of a property have been exchanged and then only if the eventual profit
from that property can be foreseen with reasonable certainty
ifric 15 concludes that revenue from open market sales of real estate should be accounted for on
legal completion of the properties in accordance with ias 18 the sale of properties under certain
terms within specific construction contracts will continue to be accounted for under ias 11 and in the
group’s case this applies to all sales of affordable homes the accounting treatment for affordable
homes is therefore unaffected by ifric 15
the group now recognises revenue from the sale of open market private homes and commercial
units entirely at the point of legal completion in accordance with ias 18 as a result of adopting ias 
18 all selling expenses previously capitalised within inventories and included within cost of sales when
revenue was recognised are now expensed as incurred unless they relate to the creation of a
tangible asset such as a fixed sales office these selling expenses are charged after gross profit but
within operating profit
the most significant impact of ifric 15 on the reported results of telford homes is therefore the
deferral of profits previously recognised from the point of exchange of contracts onwards until the
point of legal completion 
ias 23 revised borrowing costs
ias 23 revised ‘borrowing costs’ is effective for periods beginning on or after 1st january 2009 the
group has taken up the option of adopting ias 23 revised from 1st april 2008 
ias 23 revised requires an entity to capitalise borrowing costs directly attributable to the acquisition
construction or production of qualifying assets as part of the cost of those assets qualifying assets are
those that take a substantial period of time to get ready for use or sale previously under the existing ias
23 an entity was able to choose whether to capitalise borrowing costs or to write them off as incurred
each development undertaken by the group represents a qualifying asset under ias 23 revised due
to the period of time taken in obtaining planning consent and completing construction on the site
each development typically has site specific finance and therefore borrowing costs can be directly
attributed to each site
as a result of the adoption of ifric 15 the impact of ias 23 revised is typically to defer the expensing
of borrowing costs to the income statement previously borrowing costs were written off as incurred
over the life of each development and now a substantial proportion will not be expensed until legal
completion of the open market private homes
a restated income statement and balance sheet for the year ended 31st march 2008 are included on
pages 80 to 81 the only changes required to cash flow statements previously reported are presentational
telford ra text  15609  1804  page 77 79     telford homes plc 2009
21 early adoption of ifric 15 and ias 23 revised continued
impact on income statement for the year ended 31st march 2008
revenue for the year ended 31st march 2008 is reduced by £633 million as a result of the timing
difference between contract exchanges and legal completions under ifric 15 revenue is reduced
by a further £04 million as a result of ias 23 revised and the modest effect it has on the percentage
completion of affordable homes
cost of sales for the year ended 31st march 2008 is reduced by £507 million as a result of the change
in recognition of revenue under ifric 15 and the separate write off of selling expenses under ias 23
revised cost of sales is increased by £36 million where finance costs have been capitalised within
inventories and released to cost of sales as revenue is recognised
administrative expenses for the year ended 31st march 2008 are increased by £45000 due to
depreciation of sales offices now recognised as tangible assets other selling expenses are now
written off as incurred increasing total expenses by a further £23 million
finance costs in the year ended 31st march 2008 are reduced by £78 million as these are capitalised
under ias 23 revised remaining finance costs relate to non development specific costs and bank
interest on developments where capitalisation has been suspended
profit before income tax is reduced from £177 million to £65 million the income tax expense is
restated by 30 percent of the net impact on profit before income tax
impact on balance sheet as at 31st march 2008
property plant and equipment is increased by £85000 at 31st march 2008 as a result of the cost of
constructing sales offices now being recognised as tangible assets rather than forming part of inventories
inventories at 31st march 2008 increased by £974 million as a result of the deferral of revenue
recognition to the point of legal completion under ifric 15 and therefore the consequent reduction
in inventories charged to cost of sales capitalisation of finance costs under ias 23 revised further
increases inventories by £73 million
receivables at 31st march 2008 reduced by £1259 million under ifric 15 as a result of revenue on open
market homes now only being recognised as completion proceeds are received a further reduction of
£08 million results from the change in percentage completion on affordable sales as a result of
capitalising finance costs under ias 23 revised an element of receivables then become payable
balances primarily representing deposits received in advance and are reclassified as such
as a result of the significant deferral of profits previously recognised up to 31st march 2008 into future
years the previous income tax liability becomes an income tax asset of £46 million created by the
impact of both ifric 15 and ias 23 revised
the movements in retained earnings at 31st march 2008 represent the cumulative adjustments to the
income statement reducing retained profits by £199 million as a result of ifric 15 and increasing
them by £45 million as a result of ias 23 revised 
net assets and therefore total equity are reduced from £642 million to £489 million at 31st march 2008
notes to the financial statements
31st march 2009
telford ra text  15609  1804  page 78 financial statements
telford homes plc 2009 80
group income statement reconciliation for the year ended 31st march 2008
previously ifric 15 ias 23 restated 
reported 
£000 £000 £000 £000
revenue
sales of properties 159626 63264 392 95970
other direct income 807   807
160433 63264 392 96777
cost of sales
sales of properties 125698 50712 3613 78599
other direct costs 1157   1157
126855 50712 3613 79756
gross profit 33578 12552 4005 17021
administrative expenses 8208 45  8253
selling expenses  2340  2340
operating profit 25370 14937 4005 6428
finance income 493   493
finance costs 8136  7757 379
profit before income tax 17727 14937 3752 6542
income tax expense 5400 4481 1126 2045
profit after income tax 12327 10456 2626 4497
telford ra text  15609  1804  page 79 81     telford homes plc 2009
notes to the financial statements
31st march 2009
21 early adoption of ifric 15 and ias 23 revised continued
group balance sheet as at 31st march 2008
previously ifric 15 ias 23 reclassify restated 
reported 
£000 £000 £000 £000 £000
non current assets
property plant and equipment 822 85   907
deferred income tax assets     
822 85   907
current assets
inventories 74446 97370 7297  179113
trade and other receivables 120174 125933 808 19198 12631
current income tax assets    4624 4624
cash and cash equivalents 4698    4698
199318 28563 6489 23822 201066
total assets 200140 28478 6489 23822 201973
non current liabilities
hire purchase liabilities 18    18 
deferred income tax liabilities 4    4
22    22
current liabilities
trade and other payables 32393   19198 51591
current income tax liabilities 1971 8543 1948 4624 
borrowings 101424    101424
hire purchase liabilities 83    83
135871 8543 1948 23822 153098
total liabilities 135893 8543 1948 23822 153120
net assets 64247 19935 4541  48853
capital and reserves
issued share capital 3750    3750
share premium 29749    29749
retained earnings 30748 19935 4541  15354
total equity 64247 19935 4541  48853
telford ra text  15609  1804  page 80 telford homes plc 2009 82
development guide 2009
wa n s t e a d
flat s
hospital 
hill wood
w a l thamstow
marshes
epping forest
buckhirst
hill
 blac k hors e l ane b179                              bluet road
m11
m11
4
 
 
  
  
     r o u n d w a y            b r u c e g r o v e
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g r e a t c a m b r i d g e r o a d a 1 0
g r e e n l a n e s 
    
  
 
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f o r e s t r o a d     b r o a d    l a n e       
        
wa t e rme a d w ay  
 
 
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h i g h r o a d
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c h i g w e l l r o a d     a 1 1 3  
 
 
h i g h r o a d   
 
a 1 2                a1 2 
 a 1 2  e a s t e r n a v e n u e
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l o r d s h i p l a n e
               w e st g r e e n r o a d
             
       c h i n g f o r d r o a d  o l d c h u r c h roa d 
 
 
 
c r a n b r o o k r o a d 
 
 h a i n a u l t r o a d
               a 1 3        a l f r e d s w ay
              c r a n b r o o k r o a d 
 
                i l f o r d l a n e a 1 2 3
high s t r e e t s o u t h h i g h s t r e e t n o r t h
                r o m f o r d r o a d
h e a d 
            k i n g s r o a d 
 
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
n e w r o a d  
 
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
nayland court
romford
bethnal green rd
holland estate
stadthaus
lesney
greenwich creekside
stadia
decorum
vellum
kinetica
queens road
lanrick road
metro east
casa
st anne’s row
st george’s estate
sobow
bede estate
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 v e rto 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
current and future developments showing proximity to three key areas
of growth and employment  the city canary wharf and stratford
telford ra cov  15609  1713  page 83 telford homes plc
first floor stuart house
queensgate britannia road
waltham cross herts en8 7tf
tel 01992 809800
fax 01992 809801
wwwtelfordhomesplcuk
telford ra cov  15609  1713  page 84


Summary:
 “the board is cautiously
optimistic in its outlook
and believes telford
homes is well placed
to benefit from a future
improvement in
market conditions”
andrew wiseman
chief executive
in spite of the unprecedented and difficult
financial environment for the group’s investor
customers the number of open market property
completions achieved in the year to 31st march
2009 rose to 350 from 306 in the previous year total
revenue has grown by 10 per cent to £1067 million
with profit before tax and exceptional items up 12
per cent to £73 million
the group reported in september 2008 that new
accounting standards had resulted in a change
to its accounting policies in relation to open
market private homes with revenue and profit
now recognised on legal completion on
affordable homes sold to housing associations
under construction contracts revenue and profit 
is recognised on a percentage of completion
basis there are currently over 700 affordable
homes being developed and payments will
continue to be received from the group’s
housing association partners as construction 
of these homes progresses
sales
the strategy of telford homes has always been
to presell open market homes at a very early
stage of construction whenever possible the
success of this strategy in the past has meant
that the group has had relatively few properties
available for sale over the past twelve months
market conditions have affected the confidence
of purchasers of new homes and as such the
marketing of unsold homes on developments
due for completion in 2010 and 2011 has been
held back while construction continues with
substantial forward sales on these projects
including the affordable housing the group’s
decision to continue building has been taken
with a recognition that lower open market sales
prices may be realised in the future
efforts to secure new sales have been
concentrated at the group’s developments 
at queen mary’s gate in south woodford and
nayland court in romford at queen mary’s gate
the first phase of the development including 184
open market homes was completed in may 2008
and all but one have been sold and occupied
with the final property now reserved the second
phase including 93 open market homes was
completed in november 2008 and 29 have been
sold to date the third phase including 95 open
market homes will not be build complete until the
second half of 2010 overall sales at queen mary’s
gate have been considerably slower throughout
the last twelve months although eight sales have
completed in the last twelve weeks with a further
four reserved and one property where contracts
have been exchanged visitor levels are now
much higher than at the end of 2008 and this 
gives the board an expectation that a slow but
steady rate of sales will continue to be achieved
through the rest of this year
07     telford homes plc 2009
chief executive’s review
telford ra text  15609  1802  page 6 telford homes plc 2009 08
business  financial review
metro east e3
telford ra text  15609  1802  page 7 09    telford homes plc 2009
chief executive’s review continued
onestratford e15
telford ra text  15609  1802  page 8 20000
0
30000
40000
50000
60000
70000
80000
mar 09
feb 09
jan 09
dec 08
nov 08
oct 08
sep 08
aug 08
jul 08
jun 08
may 08
apr 08
mar 08
feb 08
jan 08
seasonally adjusted monthly number of mortgage approvals for house purchases by individuals
source bank of england
at nayland court in romford telford homes has
26 build complete homes remaining for sale with
demand for these being maintained by the ‘my
choice home buy’ scheme “mchb” from the
hca which provides a mortgage for up to 50
per cent of the home with a very low deposit
and interest rate the processing of mchb
applications suffers from periodic delays in the
release of funds but the group has seven homes
currently reserved on the development all using
this product here again recent progress means
the group would expect to sell the majority of
the remaining properties during 2009
telford homes will bring other developments
back to the market when conditions are right
and when construction on those developments
reaches an appropriate stage to attract buyers
completions
from 1st october 2008 telford homes began 
a rolling programme where 613 open market
homes sold in previous years would become
due for legal completion in the period up to
march 2010 as at 31st march 2009 220 of 
these properties had been legally completed
the key issues for the group’s customers are the
restriction of mortgage finance for buytolet
investors and the increasing caution applied by
valuation surveyors with a lack of comparable
transactions importantly the group’s properties
continue to attract tenants for its investor
customers and this underpins their value
the general problems experienced in securing
mortgages are illustrated by statistics for the
number of mortgage approvals for house
purchases in 2008 the bank of england
seasonally adjusted figures show that the number
of approvals per month fell rapidly from 71000 in
january 2008 to 27000 in november 2008 since
then there has been some improvement in these
statistics with the number of approvals reaching
39000 in march 2009 this is still well below normal
levels and whilst to date the process of achieving
new sales and completions has not got any easier
the board hopes it is an indication that mortgage
availability will improve during the rest of 2009
telford homes continues proactive
communication with each purchaser to ensure
their financial arrangements are instigated at
the right stage and the group has been
working with each of them to maximise the
chances of achieving completions in addition
telford homes has maintained a dialogue with
some of the major lenders and their valuers to
give maximum comfort in the pricing of the
group’s apartments through transparency of
information and supporting evidence the
board has reported in the past that the telford
homes approach to sales is based on net prices
agreed at the point of sale with no undisclosed
discounts or incentives and this has proved
extremely important both to customers of
telford homes and their lenders
the group will rescind contracts on properties
where its customers are unable to complete 
the purchase retaining the 10 per cent deposit
already paid where necessary telford homes
will also take legal action against the defaulting
purchasers as a result of their failure to honour
contractual obligations
telford homes plc 2009 10
business  financial review
telford ra text  15609  1802  page 9 11     telford homes plc 2009
despite achievements to date the group is
experiencing significant delays in securing each
completion as a result the board has positioned
telford homes to withstand an increased number
of delays and failures the total number of failures
in the year to march 2010 is forecast to reach
between 60 and 80 of the presold homes due to
complete over that period assuming there is no
improvement in mortgage availability
telford homes has contingency plans in place to
deal with failed contracts which will mitigate the
impact on cash flow these plans include
temporarily securing tenants for the properties
before reselling them into an orderly market the
group has obtained outline terms from each of
its three banks to provide mortgages against a
portfolio of these rented properties at between
50 and 60 per cent of their value and in addition
the group is well advanced with contractual
negotiations to secure £6 million of funding from
alternative sources at a 75 per cent loan to value
ratio this will enable the business to withstand
significantly more failures than anticipated as 
well as providing cash resources to further our
partnerships with housing associations and
housing transfer organisations
hca and affordable housing
the board has taken a number of steps to
maintain activity in the construction of new homes
through partnerships with housing associations and
the hca as reported on 20th april 2009 the group
has agreed a grant programme with the hca of
£57 million across four sites owned by telford homes
and three estate regeneration projects in
partnership with eastend homes the grants will
part finance over 400 affordable homes over 
the next three years
partnerships with affordable housing providers
remain integral to the business and typically 35
per cent of any development is sold for
affordable housing however in order to derisk
new projects the group has sought to construct
some developments entirely for its housing
association partners utilising hca grant although
at a lower margin this gives telford homes the
ability to commence construction on these sites
with secured cash inflows over the course of the
development the group has recently entered
into a contract with family mosaic to construct 63
affordable homes across two sites in queens
road southwark and a contract with gallions
housing association to construct 53 affordable
homes in st anne’s row e14 the group has also
agreed terms to construct 64 affordable homes
for poplar harca in lanrick road e14
chief executive’s review continued
sobow e3
telford ra text  15609  1802  page 10 telford homes plc 2009 12
partnerships and the development pipeline
telford homes has maintained its prudent
approach to investment in land during the last
twelve months whilst retaining financial resources
to deploy in its partnerships with eastend homes
and poplar harca the group reported last year
that 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
the british estate e3 has set the model for the
partnership with eastend homes where land
payments made by telford homes have been
reinvested into the third party refurbishment of
existing homes on the estate the group has now
entered into a contract to build 54 affordable
homes on the st george’s estate e1 for eastend
homes along with a construction contract for
infrastructure works required on the estate in
addition telford homes has option contracts over
land on the estate to provide 139 open market
homes and these are due from 2010 onwards
construction of the affordable homes is now
underway and as such the group has drawn 
its first grant tranche from the hca
telford homes continues to progress master plans
for the regeneration of five other estates with
eastend homes and the group expects to
commence construction of 74 affordable homes
on the bede estate e3 in autumn 2009 bede and
the other estates are expected to add in excess
of 900 properties to the development pipeline
over the next few years and the partnership with
poplar harca an additional 400 properties
as at 31st march 2009 the total pipeline of open
market and affordable properties not yet legally
completed was 2635 including 2400 with
planning permission this total includes sites
under option contracts within the control of the
group of these properties 1503 are under
construction with 1115 currently secured by
contracts exchanged either for open market
sale or for affordable housing open market
presales contracts totalled £1284 million at 31st
march 2009 although some of these will fail 
to complete leaving the group with unsold
property affordable housing revenue contracted
but not yet recognised totalled £346 million at
the year end and this is secured through payments
received from housing associations as
construction progresses
business  financial review
decorum e10
telford ra text  15609  1802  page 11 13     telford homes plc 2009
chief executive’s review continued
planning
the group’s focus on east london gives telford
homes significant development presence that
engenders respect from the local planning
authorities and the group has achieved a
number of important permissions this year these
include 193 homes on the st george’s estate
236 homes on the bede estate and 209 homes
on the holland estate the group is working 
with both eastend homes and poplar harca 
to achieve planning permissions on land owned
by them that will later be developed under 
the existing partnerships only two of the sites
owned directly by telford homes do not have
detailed planning permission and the group is
progressing plans on each of these with the 
aim of receiving approvals during 2009
people
in december 2008 the group reported that 
the board expected to reduce the number 
of people employed by telford homes by
between a quarter and a third before the end of
2009 depending on success in securing projects
that do not require a cash investment the hca
grant programme and the group’s expectation
of constructing affordable housing on a number
of developments gives the board confidence
that the number of redundancies will be less
than originally feared as ever and in particular
during these difficult times with pay frozen and
no bonuses being paid the board is extremely
grateful for the commitment and effort shown
by all of the group’s employees
construction
despite the impact that market conditions and
the redundancy programme have had on
morale telford homes has continued to produce
well designed and well built developments this is
a real credit to the work of the operating divisions
in a period that has seen continual appraisal of
prospects and a consequent reorganisation
alongside redundancies
the quality of the finished product continues 
to be ensured by the work of the telford homes
customer service team that provide quality
control and give a consistent ‘face’ to customers
the delivery of a first rate home is a fundamental
step in the completion process
construction is the heart of telford homes and
health and safety is at the forefront of the
group’s working practices the group has
continued to develop and monitor its policies
and procedures during the year and its very
good record has been maintained 
current trading and outlook
the focus at the start of the new financial year
remains on maximising positive cash flows into the
business including achieving legal completions
already since 1st april 2009 over 50 open market
homes have been completed and handed over to
customers and this progress remains encouraging
0
10000
20000
30000
40000
50000
60000
first quarter 2009 first quarter 2008 first quarter 2007
number of new homes starts recorded in january to march of each year 
source nhbc statistics
telford ra text  15609  1802  page 12 telford homes plc 2009 14
business  financial review
the group will continue to work on securing
profitable contracts to construct affordable
housing on some of its sites with the added 
cash flow benefit to telford homes this will be
substantially supported by the grant programme
with the hca and the group expects to draw up
to 60 per cent of its total allocation before 31st
march 2010 this will partly be utilised as payment
for land purchased from the group’s development
partners alongside this sales and marketing
activity will be concentrated on the completed
units at queen mary’s gate where we are
experiencing increased interest from potential
purchasers and romford before turning to other
sites again at the appropriate time and when
market conditions are right
across the country construction of new homes has
reached a new low for recent years with national
housebuilding council “nhbc” statistics for new
home starts at 16200 for the first quarter of 2009
against 37800 in the first quarter of 2008 and 53700
for the same period in 2007 this will inevitably lead
to an increased shortage of new homes in the next
few years and telford homes will be ready to meet
the challenge of satisfying demand when the time
comes east london will be at the forefront of
increasing the supply of new homes in london 
as regeneration of the area continues
the board is cautiously optimistic in its outlook due
to increased activity at queen mary’s gate and
legal completions on presold homes progressing
as well as could have been anticipated the hca
grant programme and the group’s partnerships
with affordable housing providers will underpin the
performance of telford homes in the next few
years the board believes the business is now in a
strong position and is well placed to benefit from
a future improvement in market conditions
andrew wiseman
chief executive
26th may 2009
stadthaus n1 casa e14
telford ra text  15609  1802  page 13