Half Yearly Report

RNS Number : 3682A

Galliford Try PLC

19 February 2014

 



GALLIFORD TRY PLC - HALF YEAR REPORT FOR THE SIX MONTHS ENDED 31 DECEMBER 2013

                      CONTINUING STRONG PROGRESS AND STRATEGY UPDATE TO 2018

Financial	H1 2014	H1 2013	Change
·      Group revenue ¹	£803.5m	£678.3m	+18%
·      Profit before tax	£38.1m	£32.3m	+18%
·      Earnings per share	36.8p	31.3p	+18%
·      Dividend per share	15.0p	12.0p	+25%
·      Net debt	£85.9m	£58.2m	+ £27.7m
·      Group return on net assets ²	17.1%	14.9%	+ 2.2 ppts

Group

·      Record half year results; strong progress towards the full year.

·      Net debt of £85.9 million (H1 2013: £58.2 million), reflecting the planned significant increase in landbank. 

·      Across all businesses we continue to manage supply chain constraints. 

·      New £400 million five year unsecured bank facility. 

·      Interim dividend up 25%, continuation of our progressive dividend policy with expectation of full year dividend at 1.8x cover.

·      Disciplined growth strategy to 2018 with the objective of more than doubling FY13's profits and earnings per share.

Housebuilding ³

·      Linden Homes revenue up 20% to £328.2 million (H1 2013: £273.5 million) from completions of 1,300 units; 1,230 units net of joint venture partner share (H1 2013: 1,297 and 1,168 respectively).

·     13.5% Linden Homes operating margin (H1 2013: 12.4%) showing good progress against our margin enhancement programme.

·      Galliford Try Partnerships business now realigned within the housebuilding division to refocus management to capture significant growth opportunities.

·      Galliford Try Partnerships revenue, including both contracting and mixed tenure, up 134% to £100.9 million (H1 2013: £43.1 million) generating an operating margin of 1.9% (H1 2013: 1.2%).  59 private sales in the period.  

·     17% increase in total sales currently reserved, contracted and completed across Linden Homes and Galliford Try Partnerships at £744 million (H1 2013: £638 million); strong partnerships contracting order book of £0.5 billion (H1 2013: £0.4 billion). 

·      Record landbank of 13,500 plots.  90% landbank secured now at current market value (H1 2013: 84% of 10,700).  100% of land secured for 2015 and 70% of land secured for 2016 with the land market remaining generally positive.

Construction ³

·      Construction margin of 1.4% (H1 2013: 1.8%) in line with expectations in a challenging market with opportunity levels continuing to rise.

·      Robust order book at £1.25 billion (H1 2013: £1.2 billion) providing high quality and diverse future revenues.  100% of projected revenue secured for the current financial year with 65% secured for 2015 (31 December 2012: 100% and 65% respectively). 

·      Strong cash balance of £121.5 million underlining the solid performance of the business (H1 2013: £123.0 million).

Greg Fitzgerald, Chief Executive, commented:

"The half year saw strong performance across the Group and we have been very encouraged by the start of the calendar year.  Group profit for the half year is at a record high and we continue to be encouraged by the levels of future opportunities.

Housing market conditions continue to improve with Linden Homes revenue rising 20% and good progress is being made on our margin enhancement plan.  In the first six months of the financial year we have secured a significant increase in our landbank and the land market remains generally positive. 

As previously indicated we have realigned Galliford Try Partnerships within housebuilding so as to maximise the significant potential of our strong presence in the affordable housing market.

In construction we have increased our order book as our businesses continue to perform strongly in the current market.  Whilst the market in the short term remains challenging we continue to see increased levels of opportunities and I am delighted with the new projects awarded during the period.

The Group's performance since the start of the calendar year has been strong and we are confident of meeting the Board's expectations for the full year.  Reflecting our first half year performance and confidence in the future we have increased the interim dividend by 25% to 15.0 pence per share.

I am also delighted to announce our exciting strategy to 2018 supported by the Group's new £400 million unsecured bank facility, which we anticipate will deliver further strong shareholder returns".

For further enquiries:

Galliford Try                                              Greg Fitzgerald, Chief Executive                                          01895 855001

                                                                    Graham Prothero, Finance Director               

Tulchan Communications                     Christian Cowley, James Macey White                             020 7353 4200

Galliford Try will hold its half year results presentation for analysts and institutional investors at 09:30 am on Wednesday 19 February 2014 at The London Stock Exchange, 10 Paternoster Square, London, EC4M 7LS.  A live audio webcast will be available at www.gallifordtry.co.uk/investors with a recording available later.  A video interview with Graham Prothero on the results will be available at www.gallifordtry.co.uk.

¹  'Group revenue' excludes share of joint ventures of £33 million (H1 2013: £47 million).  'Revenue' where stated throughout this half year report includes share of joint ventures.

²  Group return on net assets represents profit before tax, finance costs and amortisation compared to average net assets.

³   Comparative figures throughout this half year report have been restated for the new segmental reporting of Galliford Try Partnerships, as set out in note 3 of the financial statements.

STRATEGY TO 2018

Targeting disciplined growth across all businesses to deliver strong shareholder returns

The Board has reviewed its strategy against a backdrop of an improving economy and, assuming continued economic stability, is targeting disciplined growth across all businesses in the period to 2018.  The plan assumes no material early tightening of the private housing market, with mortgage availability and flexibility continuing to grow, and no change to the announced scale and duration of the Government's Help to Buy initiative.  More broadly, it presumes continuation of Central Government support for affordable housing, and of a steady recovery in the wider construction market.  We have also assumed a continuation of the current tougher building environment initially, stabilising towards the end of the period.

Housebuilding

Linden Homes

The business will continue to focus on its margin enhancement programme and we expect operating margin to rise towards 18%.  We are also targeting a disciplined expansion in volumes to increase revenue by circa 50% from the record FY13 level.  The business will continue to focus on well located sites principally in the south and south east, and its increasing bias towards houses over apartments.

Galliford Try Partnerships

To respond to the demand for and growth in affordable housing our partnerships business has been realigned within housebuilding so as to create a regeneration and land led contractor/developer with a refocused management team.  The business will target an increase in mixed tenure turnover to in excess of £60 million, with the revenue from the contracting business increasing by 200% over FY13 to fund future regeneration and land led activities.  We expect the blended operating margin to increase to 3.5 - 4.0%.

In a land market that continues to be generally positive we are planning to acquire a 14,000 unit landbank early in the period, across Linden Homes and Partnerships that will remain stable thereafter and provide a comfortable 3½ - 4 year supply.

Construction

Following a year of sustained and improved levels of opportunity we intend to grow our building and infrastructure businesses by circa 50%.  We expect turnover to increase from an improving private sector as well as an increased participation in frameworks and major projects.

Maintaining our focus on risk management we will continue to prioritise margin and strict cash management.  In the short term we continue to expect operating margin to fall, but then to rise towards 2.0%. 

Our investments business will continue to promote its PFI/PPP investment capabilities to support our construction and partnerships businesses.

Group

We will capitalise on the excellence of our team to deliver growth across the business, as well as focus on the challenge of recruiting to support our plans.  We will continue to optimise the opportunities in intra-group trading.

The business plan maintains our normal discipline around working capital, and is comfortably accommodated by the Group's new £400 million unsecured five year credit facility.  We are targeting period end gearing no higher than 30%, with average and peak levels well below covenant levels.

In parallel with our disciplined growth plans for all businesses we will maintain our progressive dividend policy, with 1.8x cover in 2014 reducing to 1.7x cover for the remainder of the period.

Our strategy is expected to more than double FY13's profit before tax and earnings per share by 2018, with a greater increase in the dividend.

DIVIDEND

In line with strategy and reflecting the Group's strong performance during the half year to 31 December 2013 the Directors have declared an interim dividend of 15.0 pence per share (H1 2013: 12.0 pence) which will be paid on 9 April 2014 to shareholders on the register at close of business on 21 March 2014.

FINANCIAL REVIEW

Group revenue for the half year to 31 December 2013 was up 18% at £803.5 million (H1 2013: £678.3 million).  Revenue (including share of joint ventures) was up 15% to £836.0 million (H1 2013: £725.3 million).

The Group achieved a profit from operations (stated before finance costs, tax and share of joint ventures' interest and tax) of £44.1 million up 18% against the same period last year driven by improvement in revenue and margin in housebuilding.  Profit before tax was up £5.8 million at £38.1 million (H1 2013: £32.3 million), and earnings per share for the period was up to 36.8p (H1 2013: 31.3p).  We are separately reporting the Partnerships segment within housebuilding for the first time.  The restated comparative housebuilding and construction figures are set out in note 3 of the financial statements.

The Group maintained its strong focus on cash management throughout the period.  Net debt at 31 December 2013 was £85.9 million (H1 2013: £58.2 million), in line with our expectations and reflecting the planned significant increase in the landbank and excellent performance from construction.  Average debt over the six months to 31 December 2013 was £155 million compared to £116 million in the equivalent period last year and £134 million in the full year.  The net working capital employed in Linden Homes was in line with our expectations at £579.5 million (H1 2013: £544.5 million).  The construction cash balance of £121.5 million (H1 2013: £123.0 million) demonstrates continued strong performance.

The taxation expense of £8.2 million reflects an estimated effective rate of 21.5% (H1 2013: 21.7%) for the full financial year to 30 June 2014 as detailed in note 5 of the financial statements.  We anticipate a similar effective tax rate will be maintained for the foreseeable future. 

New Five Year Banking Arrangement

The Group has successfully refinanced its banking arrangements, entering into a new five year unsecured revolving credit facility of £400 million, an increase of £75 million on the facility it replaced. 

The increased facility gives the Group capacity to continue its investment in land and achieve its growth strategy.  The costs of the new facility are similar to the previous arrangement, with a simplified covenant package.  We are delighted with the continuing support of our three existing banks (HSBC, Barclays and Royal Bank of Scotland) and also to welcome Santander to the syndicate.  The Group continues to operate well within its headroom and covenants under both facilities.

HOUSEBUILDING

Linden Homes

	H1 2014	H1 2013
Revenue £m	328.2	273.5
Profit from operations £m	44.2	33.9
Operating profit margin %	13.5	12.4

The housing market, particularly in our key geographic locations in the south of England, is improving, which is reflected in our revenue during the six months to 31 December 2013 increasing to £328.2 million (H1 2013: £273.5 million).  Profit from operations was £44.2 million up 30% on last year.

During the six months to 31 December 2013 we achieved a rate of sale of 0.52 unit sales per outlet per week, resulting in a 9% increase in actual sales reservations made compared to the same period last year.  Since 31 December 2013 the rate of sale has increased to 0.61 unit sales per outlet per week.

During the first half of the year there were 1,300 unit completions, 1,230 net of joint venture partners' share (H1 2013: 1,297 and 1,168 respectively).  The total includes 1,018 private and 282 affordable sales.

Linden Homes average selling price on private sales increased by 15% to £291,000 (H1 2013: £253,000) reflecting the strong demand for our well located southern sites and increased focus on houses.  The average selling price for affordable sales was £122,000 (H1 2013: £115,000) leading to a combined average selling price up 16% at £255,000 (H1 2013: £220,000).  Cancellation levels have remained around the long term average at 19% (H1 2013: 19%).

Housing market conditions have markedly improved.  Mortgage availability and affordability has increased substantially aided by the Government's Help to Buy scheme as well as an overall improvement in consumer confidence.  Supply chain conditions continue to be challenging, although more stable and predictable than in the summer.

Our total housebuilding landbank is currently 13,500 plots, equating to a gross development value of £3.4 billion; of which 12,141 plots, or 90% of our total landbank, has been acquired under current market conditions compared to 84% last year.  Linden Homes has 100% of land secured for the financial year to 30 June 2015 and 70% secured for 2016.  Our strategic land totals 1,699 acres, from which we expect to generate around 7,000 plots.  Overall we continue to see good opportunities to acquire land at prices that at least meet our hurdle rates.

Our strength of client relationships in the affordable sector has supported improved revenues through the active management of our Government funded Affordable Homes Programme and targeted joint venture activity. The Homes and Community Agency's Delivery Partner Panel continues to provide good land acquisition and contracting opportunities for our Linden Homes and Partnerships businesses and we have been appointed as preferred bidder on a further 585 units.

Since the start of 2014, and as we approach the spring selling season, we are encouraged by improving conditions in the housing market.  Prices achieved since July 2013 are above our expectations and Linden Homes' sales reserved, contracted or completed are currently up 17% to £729 million, of which £610 million is for the current financial year, representing 75% of projected sales for the year (H1 2013: £487 million, 72%). 

Galliford Try Partnerships

	H1 2014	H1 2013
Revenue £m	100.9	43.1
Profit from operations £m	1.9	0.5
Operating profit margin %	1.9	1.2

Revenue has increased to £100.9 million (H1 2013: £43.1 million), £6.4 million of which arose from mixed tenure developments and £94.5 million from contracting. 

Partnerships is our specialist affordable housing contractor which has a strong presence in the south east and north east of England and a growing business across the rest of the country.  The business also develops mixed tenure projects producing private housing on sites that are predominately affordable developments.  As previously announced, from 1 January 2014 our partnerships business has been realigned within our housebuilding division in order to capture the significant growth opportunity in this key market. 

During the period, as part of the consortium S4B, partnerships achieved financial close on the circa £100 million Brunswick regeneration scheme which is designed to transform the Brunswick area of east Manchester including the provision of 520 new homes, associated community facilities and enabling infrastructure works.  In east London the business also secured two housing contracts totalling £60 million for the registered provider Peabody, and has also been confirmed as preferred bidder for the Kent 'Excellent Homes for All' scheme.  The business recently announced Extra Care and affordable housing contracts totalling £55 million in Coventry, Dunstable and Taunton.

Partnerships' contracting order book is currently £500 million (H1 2013: £393 million).

CONSTRUCTION

All financial data has been restated to exclude the segmental reporting of partnerships.

	H1 2014	H1 2013
Revenue £m	398.1	400.7
Profit from operations £m	5.5	7.4
Operating profit margin %	1.4	1.8

Revenue of £398.1 million and margin of 1.4% are in line with our expectations.  The construction market continues to be challenging although we are seeing an increase in the pipeline of opportunities.  Our cash balance held at 31 December 2013 was £121.5 million (H1 2013: £123.0 million).

Against a background of a difficult market we continue to focus on risk management, margin and targeting work with acceptable returns and risk.  Our total order book is up 4% at £1.25 billion (H1 2013: £1.2 billion) and comprises 19% in the regulated sector, 50% in public and 31% in the private sector.  At the start of 2014 we had secured 100% of our projected revenue for the current financial year and 65% for our next financial year (H1 2013: 100% and 65% respectively). 

We are encouraged by the increase in pipeline of opportunities and the project wins in the period, and a selection of these is summarised below.

Building

Profit from operations of £2.1 million was achieved on revenue of £211.6 million, representing a margin of 1.0% (H1 2013: £3.8 million, £185.0 million and 2.1% respectively).  As expected the margin reduced mainly reflecting supply chain challenges in the period.

Our building business serves a range of clients across the whole of the UK.  Our most sizeable markets are the south of England, the Midlands and in Scotland where we have a significant presence and strong track record.

In the period we secured a number of key projects including health and education building contracts in the Midlands.  We are also the selected contractor for the new Birmingham dental hospital, for the Birmingham and Solihull Local Improvement Finance Trust, and at the University of Nottingham where we have been appointed to extend and refurbish the George Green engineering and science library.  In addition the business was appointed to the new four year Education Funding Agency contractors' framework.

Building's order book is currently £740 million (H1 2013: £599 million).

Infrastructure

Profit from operations was £3.4 million on revenue of £186.5 million, representing a margin of 1.8% (H1 2013: £3.6 million on £215.4 million, representing a margin of 1.7%). 

Infrastructure carries out civil engineering projects, primarily in the water, highways, flood alleviation, remediation and renewable energy markets operating across the UK. 

Our four party consortium constructing the new Queensferry Crossing is on programme with the critical marine based bridge pier foundation work complete.  During the period infrastructure, in joint venture, has been appointed by Yorkshire Water to continue as a contractor for its AMP6 framework.  The framework will commence in 2015 and is anticipated to generate at least £110 million over a five year appointment.

Infrastructure's order book currently stands at £515 million (H1 2013: £626 million).

PPP INVESTMENTS

Revenue was £8.6 million on which the loss from operations was £1.6 million (H1 2013: £7.7 million and £1.3 million respectively). 

PPP Investments specialises in delivering major building and infrastructure projects through public private partnerships.  The business leads bid consortia and arranges finance, taking direct equity investment and managing construction through to operations.

We are particularly active in Scotland where there are a number of PPP projects in progress.  We are part of the Alliance Community Partnerships consortium on the South West Scotland hub initiative, and are also part of the South East Scotland hub.  Together with our Partnerships business we have been confirmed as preferred bidder on the Kent 'Excellent Homes for All' project.

We continue to monitor PPP opportunities in England and are well placed to participate in future projects.

HEALTH, SAFETY AND ENVIRONMENT

Health and safety remains of paramount importance, and the Group is committed to achieving industry leading health, safety and environmental standards.  Our systems are fully accredited to both BS 18001 and ISO 14001 and are subject to regular third party independent audits.  Our bespoke behavioural safety programme 'Challenging Beliefs, Affecting Behaviour' continues to mature.  Employee training has continued through the year; we have now trained 724 coaches.  In addition to our employees, many business units are now holding Challenging Beliefs, Affecting Behaviour courses specifically for their supply chain.

SUSTAINABILITY

Our vision is to be leaders in the construction of a sustainable future and we follow a strategy which requires us to consider, prioritise and manage sustainability issues.  We have reviewed and refreshed the key performance indicators across our six fundamentals of health & safety, environment & climate change, our people, community, customers and suppliers.  Our dedicated Carbon Task Force is driving our carbon reduction strategy throughout the Group.

BOARD

As previously announced Ishbel Macpherson and Terry Miller joined the Board as non executive directors on 1 February 2014. 

OUTLOOK

The half year saw strong performance across the Group and we have been very encouraged by the start of the calendar year. Group profit for the half year is at a record high and we continue to be encouraged by the levels of future opportunities.

Housing market conditions continue to improve with Linden Homes' revenue rising 20% and good progress is being made on our margin enhancement plan.  In the first six months of the financial year we have secured a significant increase in our landbank and the land market remains generally positive. 

As previously indicated we have realigned Galliford Try Partnerships within housebuilding so as to maximise the significant potential of our strong presence in the affordable housing market.

In construction we have increased our order book as our businesses continue to perform strongly.  Whilst the market in the short term remains challenging we continue to see increased levels of opportunities including new projects awarded in the period.

The Group's performance since the start of the calendar year has been encouraging and we are confident of meeting the Board's expectations for the full year.  As a consequence of our strong first half year performance and confidence in the future we have increased the interim dividend by 25% to 15.0 pence per share.

We have announced our exciting strategy to 2018 supported by the Group's new £400 million unsecured bank facility, which we anticipate will deliver further strong shareholder returns.

Condensed consolidated income statement

for the half year ended 31 December 2013 (unaudited)

		Half year to 31 December 2013	Half year to 31 December 2012	Year to 30 June 2013 (audited)
	Notes	£m	£m	£m
Group revenue	3	803.5	678.3	1,467.3
Cost of sales		(708.5)	(600.9)	(1,288.4)
Gross profit		95.0	77.4	178.9
Administrative expenses		(53.3)	(46.6)	(105.4)
Share of post tax profits from joint ventures		0.8	4.2	6.9
Profit before finance costs		42.5	35.0	80.4
Profit from operations	3	44.1	37.4	84.1
Share of joint ventures' interest and tax		(1.1)	(1.9)	(2.7)
Amortisation of intangibles		(0.5)	(0.5)	(1.0)
Profit before finance costs		42.5	35.0	80.4
Finance income	4	1.3	2.4	4.0
Finance costs	4	(5.7)	(5.1)	(10.3)
Profit before taxation		38.1	32.3	74.1
Income tax expense	5	(8.2)	(7.0)	(15.9)
Profit for the period from continuing operations		29.9	25.3	58.2
Earnings per share
- basic	6	36.8p	31.3p	71.7p
- diluted	6	36.1p	30.3p	69.8p
Dividend per share	7	15.0p	12.0p	37.0p

Condensed consolidated statement of comprehensive income

for the half year ended 31 December 2013 (unaudited)

	Notes	Half year to 31 December 2013 £m	Half year to 31 December 2012 £m	Year to 30 June 2013 (audited) £m
Profit for the period		29.9	25.3	58.2
Other comprehensive income/(expense):
Actuarial gains/(losses) on retirement benefit obligations	9	2.3	(9.7)	(6.5)
Deferred tax on items recognised in equity that will not be reclassified		(1.1)	1.5	1.7
Total items that will not be reclassified to profit or loss		1.2	(8.2)	(4.8)
Items that may be reclassified subsequently to profit or loss
Movement in fair value of derivative financial instruments
-       Movement arising during the financial period		0.8	(0.5)	0.2
-       Reclassification adjustments for amounts included in profit or loss		0.1	(0.2)	0.3
Reclassification adjustment for gains on available for sale financial assets		-	-	(0.5)
Deferred tax on items recognised in equity that may be reclassified		-	(0.6)	0.3
Total items that may be reclassified subsequently to profit or loss		0.9	(1.3)	0.3
Other comprehensive income/(expense) for the period net of tax		2.1	(9.5)	(4.5)
Total comprehensive income for the period		32.0	15.8	53.7

The notes are an integral part of the condensed consolidated half year financial statements.

Condensed consolidated balance sheet 

at 31 December 2013 (unaudited)

	Notes	31 December 2013 £m	31 December 2012 £m	30 June 2013 (audited) £m
Assets Non-current assets
Intangible assets		14.9	12.7	13.4
Goodwill	8	115.0	115.0	115.0
Property, plant and equipment		10.0	10.0	9.7
Investments in joint ventures		3.5	9.1	6.0
Financial assets
- Available for sale financial assets	11	26.1	26.7	26.8
Trade and other receivables		54.4	47.0	45.2
Retirement benefit asset	9	5.9	-	0.5
Deferred income tax assets		-	8.1	2.7
Total non-current assets		229.8	228.6	219.3
Current assets
Inventories		0.5	0.5	0.4
Developments		802.6	702.4	748.2
Trade and other receivables		365.6	255.7	300.6
Cash and cash equivalents	10	55.6	74.6	57.9
Total current assets		1,224.3	1,033.2	1,107.1
Total assets		1,454.1	1,261.8	1,326.4
Liabilities Current liabilities
Financial liabilities
- Borrowings	10	(141.5)	(132.8)	(72.3)
Trade and other payables		(680.2)	(582.8)	(648.6)
Current income tax liabilities		(13.0)	(13.0)	(6.6)
Provisions for other liabilities and charges		(0.7)	(0.6)	(0.6)
Total current liabilities		(835.4)	(729.2)	(728.1)
Net current assets		388.9	304.0	379.0
Non-current liabilities
Financial liabilities
- Derivative financial liabilities		(0.2)	(2.3)	(1.1)
Retirement benefit obligation	9	-	(6.3)	-
Deferred income tax liabilities		(0.5)	-	(2.1)
Other non-current liabilities		(113.4)	(46.8)	(91.2)
Provisions for other liabilities and charges		(2.2)	(2.8)	(2.5)
Total non-current liabilities		(116.3)	(58.2)	(96.9)
Total liabilities		(951.7)	(787.4)	(825.0)
Net assets		502.4	474.4	501.4
Equity
Ordinary shares		40.9	40.9	40.9
Share premium		190.9	190.8	190.9
Other reserves		4.8	5.3	4.8
Retained earnings		265.8	237.4	264.8
Total equity attributable to owners of the Company		502.4	474.4	501.4

The notes are an integral part of the condensed consolidated half year financial statements.

Condensed consolidated statement of changes in shareholders' equity

for the half year ended 31 December 2013 (unaudited)

	Notes	Share  capital £m	Share  premium  £m	Other reserves  £m	Retained earnings £m	Total  equity £m
Half year ended 31 December 2013
Balance at 1 July 2013		40.9	190.9	4.8	264.8	501.4
Profit for the period		-	-	-	29.9	29.9
Other comprehensive income		-	-	-	2.1	2.1
Total comprehensive income for period		-	-	-	32.0	32.0
Transactions with owners:
Dividends	7	-	-	-	(20.5)	(20.5)
Purchase of own shares		-	-	-	(12.4)	(12.4)
Share based payments		-	-	-	1.9	1.9
Balance at 31 December 2013		40.9	190.9	4.8	265.8	502.4
Half year ended 31 December 2012
Balance at 1 July 2012		40.9	190.8	5.3	241.4	478.4
Profit for the period		-	-	-	25.3	25.3
Other comprehensive (expense)		-	-	-	(9.5)	(9.5)
Total comprehensive income for period		-	-	-	15.8	15.8
Transactions with owners:
Dividends	7	-	-	-	(17.2)	(17.2)
Purchase of own shares		-	-	-	(3.9)	(3.9)
Share based payments		-	-	-	1.3	1.3
Balance at 31 December 2012		40.9	190.8	5.3	237.4	474.4
Year ended 30 June 2013 (audited)
Balance at 1 July 2012		40.9	190.8	5.3	241.4	478.4
Profit for the year		-	-	-	58.2	58.2
Other comprehensive (expense)		-	-	(0.5)	(4.0)	(4.5)
Total comprehensive income for period		-	-	(0.5)	54.2	53.7
Transactions with owners:
Dividends	7	-	-	-	(26.9)	(26.9)
Purchase of own shares		-	-	-	(7.7)	(7.7)
Issue of shares		-	0.1	-	-	0.1
Share based payments		-	-	-	3.8	3.8
Balance at 30 June 2013		40.9	190.9	4.8	264.8	501.4

The notes are an integral part of the condensed consolidated half year financial statements.

Condensed consolidated cash flow statement

for the half year ended 31 December 2013 (unaudited)

	Notes	Half year to 31 December 2013 £m	Half year to 31 December 2012 £m	Year to 30 June 2013 (audited) £m
Cash flows from operating activities
Continuing operations
Profit before finance costs		42.5	35.0	80.4
Adjustments for:
Depreciation and amortisation		1.7	1.9	3.8
(Profit) on sale of investments in joint ventures and non-current assets held for sale		-	(0.5)	(0.1)
Loss/(profit) on sale of available for sale financial assets		0.1	(0.2)	(0.8)
Share based payments		1.9	1.3	3.8
Share of post tax (profits)/losses from joint ventures		(0.8)	(4.2)	(6.9)
Movement on provisions		(0.2)	(0.4)	(0.7)
Other non-cash movements		(0.1)	(1.0)	(1.8)
Net cash generated from operations before pension deficit payments and changes in working capital		45.1	31.9	77.8
Deficit funding payments to pension schemes		(3.1)	(3.7)	(7.3)
Net cash generated from operations before changes in working capital		42.0	28.2	70.5
(Increase)/decrease in inventories		(0.1)	(0.1)	-
(Increase)/decrease in developments		(54.4)	18.2	(28.4)
(Increase)/decrease in trade and other receivables		(74.7)	14.8	(28.3)
Increase/(decrease) in payables		53.0	(114.0)	(3.8)
Net cash (used in)/generated from operations		(34.2)	(52.9)	10.0
Interest received		0.4	0.5	2.0
Interest paid		(4.4)	(4.4)	(8.6)
Income tax (paid)		(1.8)	(2.1)	(9.2)
Net cash (used in) operating activities		(40.0)	(58.9)	(5.8)
Cash flows from investing activities
Dividends received from joint ventures		3.3	0.5	6.3
Proceeds from investments in joint ventures and non-current assets held for sale		-	1.2	-
Proceeds from available for sale financial assets		1.6	0.8	(0.6)
Purchase of intangible assets		(2.0)	(1.4)	(2.6)
Acquisition of property, plant and equipment	3	(1.5)	(1.9)	(3.2)
Proceeds from sale of property, plant and equipment	3	-	0.1	0.7
Net cash generated from/(used in) from investing activities		1.4	(0.7)	3.5
Cash flows from financing activities
Purchase of own shares		(12.4)	(3.9)	(7.7)
Increase in borrowings		69.2	59.5	(1.0)
Dividends paid to Company shareholders	7	(20.5)	(17.2)	(26.9)
Net cash generated from/(used in) financing activities		36.3	38.4	(35.6)
Net (decrease)/increase in cash and cash equivalents		(2.3)	(21.2)	(37.9)
Cash and cash equivalents at beginning of period		57.9	95.8	95.8
Cash and cash equivalents at end of period	10	55.6	74.6	57.9

Bank overdrafts are excluded from the definition of cash and cash equivalents.

The notes are an integral part of the condensed consolidated half year financial statements.

Notes to the condensed consolidated half year financial statements

for the half year ended 31 December 2013 (unaudited)

1      Basis of preparation

The Company is a public limited company incorporated and domiciled in the UK. The address of its registered office is Cowley Business Park, Cowley, Uxbridge, Middlesex, UB8 2AL. The Company has its primary listing on the London Stock Exchange. This condensed consolidated half year financial information was approved for issue on 19 February 2014.

These condensed consolidated half year financial statements do not comprise statutory financial statements within the meaning of Section 434 of the Companies Act 2006.  Statutory financial statements for the year ended 30 June 2013 were approved by the board of directors on 17 September 2013 and delivered to the Registrar of Companies. The report of the auditors on those financial statements was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under Section 498 of the Companies Act 2006.

These condensed consolidated half year financial statements have been reviewed, not audited. The auditors' review opinion is included in this report.

These condensed consolidated half year financial statements for the half year ended 31 December 2013 have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and with IAS 34, "Interim Financial Reporting" as adopted by the European Union. The condensed consolidated half year financial statements should be read in conjunction with the annual financial statements for the year ended 30 June 2013, which have been prepared in accordance with IFRSs as adopted by the European Union.

The Group's activities, together with the factors likely to affect the future development, performance and position of the business are set out in this half year report. The annual financial statements for the year ended 30 June 2013 included the Group's objectives, policies and processes for managing capital, its financial risk management objectives, details of its financial instruments and hedging activities and its exposure to credit risk and liquidity risk.

The Group meets its day to day working capital requirements through its bank facilities. The Group's forecasts, taking into account the board's future expectations of the Group's performance, indicate that there is substantial headroom within the bank facilities and the Group will continue to operate within the covenants of those facilities.

After making enquiries, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the condensed consolidated half year financial statements.

2      Accounting policies

Except as described below, the accounting policies applied are consistent with those of the annual financial statements for the year ended 30 June 2013, as described in those financial statements.

(i) The Group has adopted the revised IAS19 'Employee Benefits' published in June 2011 and which came into force for financial periods beginning on or after 1 January 2013. The adoption of the new standard was not significant and did not result in any restatement of the 31 December 2012 half year results or 30 June 2013 full year results set out in note 9.

(ii) Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected annual earnings.

3      Business segmental reporting

Segmental reporting is presented in the consolidated financial statements in respect of the Group's business segments, which are the primary basis of segmental reporting. The business segmental reporting reflects the Group's management and internal reporting structure. Segmental results include items directly attributable to the segment as well as those that can be allocated on a reasonable basis. As the Group has no material activities outside the UK, segmental reporting is not required by geographical region.

The chief operating decision-makers (CODM) have been identified as the Group's chief executive and finance director. The CODM review the Group's internal reporting in order to assess performance and allocate resources.  As set out in the Financial Review, in the half year to 31 December 2013 the Group has reviewed its internal reporting structure and now reports Galliford Try Partnerships separately to Linden Homes and the other construction businesses.  Accordingly, management has determined the operating segments as housebuilding, including Linden Homes and partnerships; construction, including building and infrastructure; and PPP investments. The Group's segmental reporting has been revised, and the comparative disclosures as at 31 December 2012 and 30 June 2013 restated, to reflect the new structure. 

The CODM assess the performance of the operating segments based on a measure of adjusted earnings before finance costs, amortisation, exceptional items and taxation.  This measurement basis excludes the effects of non-recurring expenditure from the operating segments, such as restructuring costs and impairments when the impairment is the result of an isolated, non-recurring event.  Interest income and expenditure are included in the result for each operating segment that is reviewed by the CODM. Other information provided to them is measured in a manner consistent with that in the financial statements.

 

3      Primary reporting format - Business segment reporting

		Housebuilding			Construction
		Linden Homes	Partner- ships		Building	Infra- structure	Total	PPP Investments	Central costs	Total
		£m	£m		£m	£m	£m	£m	£m	£m
Half year ended 31 December 2013
Group revenue and share of joint ventures' revenue		328.2	100.9		211.6	186.5	398.1	8.6	0.2	836.0
Share of joint ventures' revenue		(20.2)	-		-	(4.9)	(4.9)	(7.4)	-	(32.5)
Group revenue		308.0	100.9		211.6	181.6	393.2	1.2	0.2	803.5
Segment result:
Profit/(loss) from operations before share of joint ventures' profit		42.6	1.9		2.1	3.4	5.5	(1.9)	(5.9)	42.2
Share of joint ventures' profit		1.6	-		-	-	-	0.3	-	1.9
Profit/(loss) from operations*		44.2	1.9		2.1	3.4	5.5	(1.6)	(5.9)	44.1
Share of joint ventures' interest and tax		(1.1)	-		-	-	-	-	-	(1.1)
Profit/(loss) before finance costs, amortisation and taxation		43.1	1.9		2.1	3.4	5.5	(1.6)	(5.9)	43.0
Net finance (costs)/income		(18.5)	(0.1)		0.2	0.5	0.7	(0.1)	13.6	(4.4)
Profit before amortisation and taxation		24.6	1.8		2.3	3.9	6.2	(1.7)	7.7	38.6
Amortisation of intangibles										(0.5)
Profit before taxation										38.1
Income tax expense										(8.2)
Profit for the period										29.9

		Housebuilding			Construction
		Linden Homes	Partner- ships		Building	Infra- structure	Total	PPP Investments	Central costs	Total
		£m	£m		£m	£m	£m	£m	£m	£m
Half year ended 31 December 2012 (restated)
Group revenue and share of joint ventures' revenue		273.5	43.1		185.3	215.4	400.7	7.7	0.3	725.3
Share of joint ventures' revenue		(41.6)	-		(0.1)	(5.3)	(5.4)	-	-	(47.0)
Group revenue		231.9	43.1		185.2	210.1	395.3	7.7	0.3	678.3
Segment result:
Profit/(loss) from operations before share of joint ventures' profit		27.9	0.5		3.7	3.6	7.3	(1.3)	(3.1)	31.3
Share of joint ventures' profit		6.0	-		0.1	-	0.1	-	-	6.1
Profit/(loss) from operations*		33.9	0.5		3.8	3.6	7.4	(1.3)	(3.1)	37.4
Share of joint ventures' interest and tax		(1.8)	-		(0.1)	-	(0.1)	-	-	(1.9)
Profit/(loss) before finance costs, amortisation and taxation		32.1	0.5		3.7	3.6	7.3	(1.3)	(3.1)	35.5
Net finance (costs)/income		(15.7)	(0.1)		0.4	0.4	0.8	-	12.3	(2.7)
Profit before amortisation and taxation		16.4	0.4		4.1	4.0	8.1	(1.3)	9.2	32.8
Amortisation of intangibles										(0.5)
Profit before taxation										32.3
Income tax expense										(7.0)
Profit for the period										25.3

		Housebuilding			Construction
		Linden Homes	Partner- ships		Building	Infra- structure	Total	PPP Investments		Central costs		Total
		£m	£m		£m	£m	£m		£m		£m	£m
Restated year ended 30 June 2013 (audited; restated)
Group revenue and share of joint ventures' revenue		632.6	97.0		406.4	416.3	822.7		6.7		0.4	1,559.4
Share of joint ventures' revenue		(76.8)	-		(0.1)	(10.5)	(10.6)		(4.7)		-	(92.1)
Group revenue		555.8	97.0		406.3	405.8	812.10		2.0		0.4	1,467.3
Segment result:
Profit/(loss) from operations before share of joint ventures' profit		75.1	1.4		6.4	6.3	12.7		(3.4)		(11.3)	74.5
Share of joint ventures' profit		9.2	-		0.1	0.1	0.2		0.2		-	9.6
Profit/(loss) from operations*		84.3	1.4		6.5	6.4	12.9		(3.2)		(11.3)	84.1
Share of joint ventures' interest and tax		(2.6)	-		(0.1)	-	(0.1)		-		-	(2.7)
Profit/(loss) before finance costs, amortisation and taxation		81.7	1.4		6.4	6.4	12.8		(3.2)		(11.3)	81.4
Net finance (costs)/income		(33.2)	(0.1)		0.7	0.8	1.5		(0.1)		25.6	(6.3)
Profit/(loss) before amortisation and taxation		48.5	1.3		7.1	7.2	14.3		(3.3)		14.3	75.1
Amortisation of intangibles												(1.0)
Profit before taxation												74.1
Income tax expense												(15.9)
Profit for the year												58.2

*Profit from operations is stated before finance costs, amortisation, share of joint ventures' interest and tax and taxation.

Inter-segment revenue eliminated from Group revenue above amounted to £27.3 million (31 December 2012: £21.9 million, 30 June 2013: £54.7 million) of which £13.8 million (31 December 2012: £9.7 million, 30 June 2013: £26.6 million) was in building, £12.9 million (31 December 2012: £11.4 million, 30 June 2013: £25.8 million) was in infrastructure, £Nil million (31 December 2012: £0.2 million, 30 June 2013: £1.0 million) was in PPP investments, and £0.6 million (31 December 2012: £0.6 million, 30 June 2013: £1.3 million) was in central costs.

Reportable segments' assets are reconciled to total assets as follows:

				Housebuilding					Construction
				Linden Homes	Partner- ships				Building	Infra- structure	Total		PPP Investments		Central costs	Total
			£m			£m		£m		£m	£m	£m		£m		£m
Half year ended 31 December 2013
Assets
Net (debt)/cash				(579.5)	17.4			76.2		45.3	121.5	(1.4)		356.1		(85.9)
Other assets																1,398.5
Borrowings																141.5
Deferred income tax assets																-
Total assets																1,454.1
Half year ended 31 December 2012 (restated)
Assets
Net (debt)/cash				(544.5)	7.2			83.4		39.6	123.0	0.3		355.8		(58.2)
Other assets																1,179.1
Borrowings																132.8
Deferred income tax assets																8.1
Total assets																1,261.8
Restated year ended 30 June 2013 (audited; restated)
Assets
Net (debt)/cash				(509.1)	7.9			94.8		37.3	132.1	(1.4)		356.1		(14.4)
Other assets																1,265.8
Borrowings																72.3
Deferred income tax assets																2.7
Total assets																1,326.4

During the period the Group acquired £1.5 million (31 December 2012: £1.9 million, 30 June 2013: £3.2 million) of property, plant and equipment and disposed of property, plant and equipment with a net book value of £Nil million (31 December 2012: £0.1 million, 30 June 2013: £0.7 million).

4      Net finance costs

	Half year to 31 December 2013 £m	Half year to 31 December 2012 £m	Year to 30 June 2013 (audited) £m
Interest receivable on bank deposits	0.2	0.3	0.4
Interest receivable from joint ventures	-	1.0	1.2
Unwind of discount on shared equity receivables	0.9	0.9	1.8
Fair value profit on financing activities - interest rate swaps	-	-	0.2
Other	0.2	0.2	0.4
Finance Income	1.3	2.4	4.0
Interest payable on borrowings	(4.8)	(4.8)	(9.5)
Unwind of discounted payables	(0.8)	(0.2)	(0.5)
Net finance cost on retirement benefit obligations	-	-	(0.2)
Other	(0.1)	(0.1)	(0.1)
Finance costs	(5.7)	(5.1)	(10.3)
Net finance costs	(4.4)	(2.7)	(6.3)

5       Income tax expense

The taxation expense on profit for the period of 21.5% (31 December 2012: 21.7%) reflects the estimated effective tax rate for the full financial year to 30 June 2014.

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 by the Employee Share Trust which are treated as cancelled.

Under normal circumstances, the average number of shares is diluted by reference to the average number of potential ordinary shares held under option in the period. The dilutive effect amounts to the number of ordinary shares which would be purchased using the aggregate difference in value between the market value of shares and the share option price. Only shares that have met their cumulative performance criteria are included in the dilution calculation. The Group has two classes of potentially dilutive ordinary shares: those share options granted to employees where the exercise price is less than the average market price of the Company's ordinary shares during the year and the contingently issuable shares under the Group's long term incentive plan. A loss per share cannot be reduced through dilution, hence this dilution is only applied where the Group has reported a profit.

The earnings and weighted average number of shares used in the calculations are set out below.

	Half year to 31 December 2013			Half year to 31 December 2012			Year to 30 June 2013 (audited)
	Earnings £m	Weighted average number  of shares	Per share amount pence	Earnings £m	Weighted average number  of shares	Per share amount pence	Earnings £m	Weighted average number  of shares	Per share amount pence
Basic EPS
Earnings attributable to ordinary shareholders	29.9	81,143,216	36.8	25.3	81,082,861	31.3	58.2	81,184,221	71.7
Effect of dilutive securities:
Options		1,693,872			2,446,243			2,182,343
Diluted EPS	29.9	82,837,088	36.1	25.3	83,529,104	30.3	58.2	83,366,564	69.8

7      Dividends

The following dividends were recognised by the Company in respect of each accounting period presented:

	Half year to 31 December 2013 £m		Half year to 31 December 2012 £m		Year to 30 June 2013 (audited) £m
	£m	Pence per share	£m	Pence per share	£m	Pence per share
Previous period final	20.5	25.0	17.2	21.0	17.2	21.0
Current period interim	-	-	-	-	9.7	12.0
Dividend recognised in the period	20.5	25.0	17.2	21.0	26.9	33.0
The following dividends were declared by the Company in respect of each accounting period presented:
	Half year to 31 December 2013 £m		Half year to 31 December 2012 £m		Year to 30 June 2013 (audited) £m
	£m	Pence per share	£m	Pence per share	£m	Pence per share
Interim	12.3	15.0	9.7	12.0	9.7	12.0
Final	-	-	-	-	20.5	25.0
Dividend relating to the period	12.3	15.0	9.7	12.0	30.2	37.0

The interim dividend for 2014 of 15.0 pence per share was approved by the board on 19 February 2014 and has not been included as a liability as at 31 December 2013.  This interim dividend will be paid on 9 April 2014 to shareholders who are on the register at the close of business on 21 March 2014.

8 Goodwill

Goodwill is allocated to the Group's cash-generating units (CGUs) identified according to business segment. The goodwill is attributable to the following business segments:

	Half year to 31 December  2013 £m	Half year to 31 December  2012 £m	Year to 30 June 2013 (audited) £m
Linden Homes	52.2	52.2	52.2
Galliford Try Partnerships	5.8	5.8	5.8
Building	17.9	17.9	17.9
Infrastructure	37.2	37.2	37.2
PPP Investments	1.9	1.9	1.9
Total	115.0	115.0	115.0

As stated in the annual financial statements for the year ended 30 June 2013, detailed impairment reviews were carried out for all business segments. Consideration has been given as to whether any events have occurred since the year ended 30 June 2013 which would give rise to an impairment and none have been identified.

9      Retirement benefit obligations

The amounts recognised in the income statement in relation to defined benefit pension schemes are as follows:

	Half year to 31 December  2013 £m	Half year to 31 December  2012 £m	Year to 30 June 2013 (audited) £m
Net costs recognised in the income statement	0.1	-	0.2

The principal actuarial assumptions used to calculate the liabilities as at 31 December 2013 have been set in a consistent manner to those adopted at 30 June 2013. These assumptions will change as market conditions change over time.

An actuarial gain of £2.3 million (31 December 2012: actuarial loss £9.7 million, 30 June 2013: actuarial loss £6.5 million) has been taken to the condensed consolidated statement of comprehensive income.

The amounts recognised in the balance sheet are as follows:

	Half year to 31 December  2013 £m	Half year to 31 December  2012 £m	Year to 30 June 2013 (audited) £m
Fair value of plan assets	194.0	183.2	188.6
Present value of defined benefit obligations	(188.1)	(189.5)	(188.1)
Surplus/(deficit) in scheme recognised as non-current asset /(liability)	5.9	(6.3)	0.5

The Group has adopted the revised IAS19 'Employee Benefits' published in June 2011 and which came into force for financial periods beginning on or after 1 January 2013. The adoption of the new standard was not significant and did not result in any restatement of the surplus/deficit recognised as a non-current asset/liability, of the actuarial losses, or of the net cost recognised in the income statement at 31 December 2012 or 30 June 2013.

10   Cash and cash equivalents

	Half year to 31 December  2013 £m	Half year to 31 December  2012 £m	Year to 30 June 2013 (audited) £m
Cash at bank and in hand	55.6	69.0	56.0
Short term bank deposits	-	5.6	1.9
Cash and cash equivalents	55.6	74.6	57.9

Net Debt	Half year to 31 December  2013 £m	Half year to 31 December  2012 £m	Year to 30 June 2013 (audited) £m
Cash and cash equivalents	55.6	74.6	57.9
Current borrowings:
Bank loans & overdrafts	(141.5)	(132.5)	(72.2)
Unsecured loan notes	-	(0.3)	(0.1)
Net (Debt)	(85.9)	(58.2)	(14.4)

11   Financial Instruments

The Group's activities expose it to a variety of financial risks. The condensed interim financial statements do not include all financial risk management information and disclosures required in the annual financial accounts; they should be read in conjunction with the Group's financial statements for the year ended 30 June 2013.

There have been no significant changes in the risk management policies since the year end.

Fair value estimation

Specific valuation techniques used to value financial instruments are defined as:

·      Level 1 - Quoted market prices or dealer quotes in active markets for similar instruments

·      Level 2 - The fair value of interest rate swaps is calculated as the present value of the estimated future cash flows based on observable yield curves

·      Level 3 - Other techniques, such as discounted cashflow analysis are used to determine fair value for the remaining financial instruments.

The following table presents the Group's assets and liabilities that are measured at fair value.

	31 December 2013			31 December 2012			30 June 2013 (audited)
	Level 2	Level 3	Total	Level 2	Level 3	Total	Level 2	Level 3	Total
Assets
Available-for-sale financial assets
- Shared equity receivables	-	23.7	23.7	-	24.8	24.8	-	24.9	24.9
- Equity securities	2.4	-	2.4	1.9	-	1.9	1.9	-	1.9
Total	2.4	23.7	26.1	1.9	24.8	26.7	1.9	24.9	26.8
Liabilities
Liabilities at fair value through income statement
- Derivatives used for hedging	0.2	-	0.2	2.3	-	2.3	1.1	-	1.1
Total	0.2	-	0.2	2.3	-	2.3	1.1	-	1.1

There were no transfers between levels during the period. The valuation techniques used to derive Level 2 fair values are consistent with those set out in the 30 June 2013 financial statements.  Level 3 fair values are determined using valuation techniques that include inputs not based on observable market data.

Fair value measurements using significant unobservable inputs (Level 3)

	31 December 2013	31 December 2012	30 June 2013
	£m	£m	£m
Opening balance	24.9	24.3	24.3
Additions	0.1	1.2	1.8
Unwind of discount on shared equity receivables	0.9	0.9	1.8
Impairment	(0.9)	(1.0)	(1.5)
Disposals	(1.3)	(0.6)	(1.5)
Closing balance	23.7	24.8	24.9

The valuation process for level 3 is consistent with that disclosed in the 30 June 2013 audited report.

The key assumptions used in level 3 valuations include future house price movements, the expected timing of receipts, credit risk and discount rates. The typical repayment period is 10-15 years and the timing of receipts is based on historical data. The discount rate of 5.5% and future house price movements used to compute the fair value are based on local market conditions.

At 31 December 2013, if UK house price inflation or the discount rate used had been 1% lower or higher respectively, and all other variables held constant, and excluding any effect of current or deferred tax, the Group's house price linked financial instruments, which consist entirely of shared equity receivables held as available for sale financial assets, would decrease in value by £1.3 million (30 June 2013 £1.6 million) or £1.4 million (30 June 2013 £1.5 million) respectively.

The total impact in the period of level 3, taken to the income statement, is a net charge of £0.6 million in cost of sales and £0.9 million finance income.

12   Contingent liabilities

Galliford Try plc has entered into financial guarantees and counter indemnities in respect of bank and performance bonds issued on behalf of Group undertakings, including joint arrangements and joint ventures, in the normal course of business amounting to £182.3 million (31 December 2012: £145.9 million, 30 June 2013: £155.2 million).

Disputes arise in the normal course of business, some of which lead to litigation or arbitration procedures.  The directors make proper provision in the financial statements when they believe a liability exists.  Whilst the outcome of disputes and arbitration is never certain, the directors believe that the resolution of all existing actions will not have a material adverse effect on the Group's financial position.

 13  Related party transactions

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not included within this note. Transactions between the Group and its joint ventures and jointly controlled operations are disclosed as follows:

	Sales to related parties			Purchases from  related parties
Trading transactions	31 Dec 2013 £m	31 Dec 2012 £m	30 Jun 2013 (audited) £m	31 Dec 2013 £m	31 Dec 2012 £m	30 Jun 2013 (audited) £m
Joint ventures	9.1	7.1	21.8	0.2	-	0.4
Jointly controlled operations	13.2	13.8	30.7	-	-	-
	Amounts owed by related parties			Amounts owed to related parties
Trading transactions	31 Dec 2013 £m	31 Dec 2012 £m	30 Jun 2013 (audited) £m	31 Dec 2013 £m	31 Dec 2012 £m	30 Jun 2013 (audited) £m
Joint ventures	11.0	23.2	22.0	1.5	0.7	6.8
Jointly controlled operations	0.2	2.8	-	1.7	-	-

	Interest and dividend income from related parties			Loans to related parties
Non-trading transactions	31 Dec 2013 £m	31 Dec 2012 £m	30 Jun 2013 (audited) £m	31 Dec 2013 £m	31 Dec 2012 £m	30 Jun 2013 (audited) £m
Joint ventures	3.3	1.5	7.5	57.8	46.3	50.0

Principal risks and uncertainties

The directors consider that the principal risks and uncertainties which may have a material impact on the Group's performance in the second half of the financial year remain the same as those outlined on pages 34 and 35 of the Group's annual report and financial statements for the year ended 30 June 2013.  These can be summarised as Group: health, safety and environmental, people, availability of financing, Group brand portfolio & maintenance, sustainability and other Group factors; housebuilding: changes to the UK housing market and the economic cycle, land acquisition, availability of mortgage finance and availability of developable land; and construction: the level of public sector spending, confidence and the availability of project finance, securing contracts and project delivery.

Forward looking statements

Certain statements in this half year report are forward looking.  Such statements should be treated with caution as they are based on current information and expectations and are subject to a number of risks and uncertainties that could cause actual events of outcomes to differ materially from expectations.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

As disclosed in note 1, the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union.

The directors' confirm that these condensed consolidated interim financial statements have been prepared in accordance with IAS 34 as adopted by the European Union, and that the interim management report herein includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8 namely:

·          an indication of important events that have occurred during the six months and the impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for the remaining six months of the financial year; and

·          material related party transactions in the first six months and any material changes in the related party transactions described in the last annual report.

The directors of Galliford Try plc are:

Ian Coull	Non executive Chairman
Greg Fitzgerald	Chief Executive
Graham Prothero	Finance Director
Ken Gillespie	Construction Division Chief Executive
Amanda Burton	Senior Independent director
Peter Rogers	Non executive director
Andrew Jenner	Non executive director
Ishbel Macpherson	Non executive director
Terry Miller	Non executive director

Signed on behalf of the board

Greg Fitzgerald

Chief Executive

Graham Prothero

Finance Director

19 February 2014

Independent review report to Galliford Try plc

Introduction

We have been engaged by the Company to review the condensed consolidated half year financial statements in the half-yearly financial report for the six months ended 31 December 2013, which comprises the Condensed consolidated income statement, Condensed consolidated statement of comprehensive income, Condensed consolidated balance sheet, Condensed consolidated statement of changes in shareholders' equity, Condensed consolidated cash flow statement and the related notes. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed financial statements.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

As disclosed in note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review. This report, including the conclusion, has been prepared for and only for the Company for the purpose of the Disclosure and Transparency Rules of the Financial Conduct Authority and for no other purpose. We do not, in producing this report, 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.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 31 December 2013 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

PricewaterhouseCoopers LLP
Chartered Accountants
19 February 2014

Uxbridge

Notes:

(a)   The maintenance and integrity of the Galliford Try 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.

 

END

 

 

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