Final Results

Boot(Henry) PLC
19 March 2008


                                 HENRY BOOT PLC


 Land promotion, property development & investment, construction and plant hire


      PRELIMINARY STATEMENT OF RESULTS FOR THE YEAR ENDED 31 DECEMBER 2007



HIGHLIGHTS


     •    Profit before tax increased by 14% to £46.5m (2006: £40.8m)

     •    Basic earnings per share increased by 24% to 24.5p (2006: 19.8p)

     •    Final dividend proposed of 3.75p (2006:  3.32p), up 13%. Total for the
          year 5.0p, an increase of 14% (2006: 4.4p) • Return on average capital
          employed 28% (2006: 30%)

     •    Net asset value per share increased 20% to 139p (2006: 116p)

     •    Group's  investment  portfolio  externally  valued  at  £81.5m  (2006:
          £30.1m)  with  revaluation  surplus  of £18.1m  (2006:  £3.0m) • Solid
          contribution from all Group activities

          (Note:  Earnings,  dividends  and net asset values per share have been
          adjusted for the 4 for 1 bonus share issue in May 2007)


Commenting on the results, Chairman, John Reis, said:

'I am very  pleased to report on a further set of  impressive  results.  All our
business  streams have performed well in a year which saw the economic  backdrop
to our business become more uncertain.  Successive  rises in interest rates have
dampened both the housing and property investment  markets.  However, as yet, we
have not seen any impact on the demand for quality land or on the prudent yields
we have used in our development appraisal process.'

'We have a  strategic  land  portfolio  of the  highest  quality,  in the  right
locations,  which is steadily moving through the planning process and which will
add to an already  strong  property  development  pipeline.  Allied to this,  we
continue to benefit from the recurring  profit,  cash  generation  and return on
assets provided by our construction, PFI and plant hire businesses.'

'This healthy mix of business  opportunities,  coupled with our robust financial
position,  gives me great  confidence in our long-term  future prospects and the
continuing delivery of value to shareholders.'


For further information, please contact:

Henry Boot PLC
Jamie Boot, Group Managing Director
John Sutcliffe, Group Finance Director
Tel: [phone]
www.henryboot.co.uk

Evolution Securities Limited
Joanne Lake
Tel: [phone]

Citigate Dewe Rogerson
Fiona Tooley
Tel: [phone]
Tel: [phone]

CHAIRMAN'S STATEMENT

I am very  pleased to report on a further  set of  impressive  results.  All our
business  streams have performed well in a year which saw the economic  backdrop
to our business become more uncertain.  Successive  rises in interest rates have
dampened both the housing and property investment  markets.  However, as yet, we
have not seen any impact on the demand for quality land or on the prudent yields
we have used in our development appraisal process.

Throughout our national network of offices,  our teams use their local knowledge
to create  valuable  opportunities  in land promotion and property  development.
Whilst  profits  from our  construction  division  and the  investment  property
rentals add an ever  increasing,  recurring  annual income,  we are, at heart, a
deal  driven  business  in both our  property  development  and  long-term  land
promotion activities.

On the whole,  our markets in 2007 remained  fairly  robust.  Land with planning
consent that we brought to the market was in strong  demand and values  achieved
were as anticipated.  The yields on property  developments  completed during the
year were in line with those used in the development  appraisals and, therefore,
we achieved the capital values expected at the outset. Our construction  company
had a very good year with Decent Homes Initiatives,  work for the Prison Service
and general contracting work all contributing to a solid result. Our PFI project
running the A69 again  provided a healthy  return and plant hire  benefited from
strong construction activity and a stable depot line-up.

Results

Turnover was £124.8m (2006:  £142.3m)  reflecting fewer land  transactions  with
lower acreages and values  completed in the period.  Profit before tax increased
14% to £46.5m (2006: £40.8m) as these lower sales were offset by valuation gains
and  development  sales  demonstrating  our  broad-based  mix of profit drivers.
Included within pre-tax profit,  the investment  portfolio  showed a revaluation
surplus of £18.1m (2006:  £3.0m) of which £16.8m arose from the valuation of our
shopping  centre at Ayr.  Property  disposal  profits were £3.5m (2006:  £1.4m),
mostly  attributable to the sale of our Ripon Gateway site prior to development.
Basic earnings per share increased 24% to 24.5p (2006: 19.8p), helped by a lower
percentage  tax  charge  compared  to 2006.  Total net assets  increased  20% to
£182.2m (2006: £152.2m),  representing 139p per share (2006: 116p). As expected,
gearing rose to 39% with debt of £70.9m at the year end (2006: gearing 10%, debt
£15.0m), as we made further investments in our land and development assets.

Dividends

These excellent results allow the Directors to continue the progressive dividend
policy  adopted  over recent years and  recommend a final  dividend of 3.75p per
share (2006: 3.32p) which, together with the interim dividend of 1.25p per share
(2006:  1.08p), gives a total for the year of 5.0p (2006: 4.4p), a 14% increase.
Dividend cover remains strong at 4.9 times (2006: 4.5 times). The final dividend
will be paid on 22 May 2008 to Shareholders on the Register on 9 May 2008.

Performance benchmarking and returns

Total  Shareholder  Value (TSV),  calculated  as the increase in net asset value
plus  dividends per share,  created in the year ended 31 December 2007 was 28.1p
per share  (2006:  25.8p),  a 24%  (2006:  27%)  return on opening  net  assets.
Although the Group achieved  record profits,  earnings,  net assets and dividend
payments,  it has not been  immune to the  change in  sentiment  towards  quoted
property  and  construction  company  equity  prices.  As a  consequence,  Total
Shareholder  Return (TSR) in the period was -41.9p (2006:  84.4p), a -19% return
on the opening price on 1 January 2007 of 215p.  TSR is calculated as the change
in share price plus dividends per share. These returns compare to an average TSR
of -8% on the FTSE Construction  Sector,  -41% on the Real Estate Sector and 12%
on the FTSE  Small  Cap  Index.  These  sectors  have  been  chosen  as the best
comparative benchmarks against which to monitor our Company.

Employees

On behalf of my fellow Directors, I express my sincere thanks to all the Group's
employees  for  their  contribution  towards  achieving  yet  another  excellent
performance.  It is our people who,  through  their  commitment,  skill and hard
work,  enable us to continue  to build upon our  outstanding  long-term  results
record and I look forward to working with the team to achieve further success in
2008.

Strategy

The  Group   strategy   continues  to  focus  on  land  promotion  and  property
development,  with the support of  construction  and plant hire  activities.  We
recognise   that  the  timing  of  profits  from  land  promotion  and  property
development  depends on market conditions and is therefore  uncertain.  This can
lead to  variability  in our  income  stream in any one  accounting  period.  To
counter this, as our  subsidiaries  create surplus funds,  after each unit's own
investment  requirements are met, and as prudent cash management allows, we will
invest in those  developments  which,  in our view,  offer the best  rental  and
capital  growth  opportunities.  This,  in turn,  improves the balance of income
arising from more stable,  enduring activities with that from land promotion and
development deals.

Outlook

The general economic  climate in which the business is currently  operating will
result in the property  sector having to endure a more turbulent  period than it
has had for some time.  That said,  much of this  uncertainty  has already  been
factored into property equity prices, including ours.

In the  current,  more  challenging  environment,  I believe  that our  outlined
strategy continues to be the right one for the long-term growth of our business.
As we progress  through 2008, the Group remains very well positioned to continue
to profit from its broadly-based portfolio of assets and opportunities.  We have
a strategic land portfolio of the highest quality, in the right locations, which
is steadily moving through the planning process and which will add to an already
strong  property  development  pipeline.  Allied to this, we continue to benefit
from the recurring profit,  cash generation and return on assets provided by our
construction, PFI and plant hire businesses.

This healthy mix of business  opportunities,  coupled with our robust  financial
position,  gives me great  confidence in our long-term  future prospects and the
continuing delivery of value to shareholders.

John S Reis
19 March 2008

OPERATIONS REVIEW

Our long-term  strategy  remains  largely  unaffected by the difficult  property
market  arising in 2007 and which is expected to continue  throughout  2008.  In
this market,  our ability to create  profit by adding value to our land,  either
through development, land promotion or construction, should allow the Company to
continue to prosper.  The acquisition of new opportunities  through our regional
office  network  should  see us enter the next  positive  cycle  with a stronger
portfolio of sites to capitalise on.

The  promotion of land  through the planning  system can take up to 20 years and
short-term  market  corrections  will  always  be a factor  in such a  long-term
process. We remain on track to achieve results on an increasing number of sites,
at the same time adding more land than we sell to our growing portfolio.

Our  development  process is underpinned by prudent market yield  assumptions at
the time of acquisition or appraisal.  Therefore,  whilst we will not escape the
effects of lower market  values,  we remain  comfortable  with the appraisals of
those properties currently progressing through the development phase.

Although the occupational market continues to be difficult in some quarters,  we
have found it still  offers  opportunities  to a developer  creating  new,  high
quality space.  Retailer interest in our relevant sites remains good. The office
market, particularly for well located, smaller units which are also available to
owner  occupiers,  is also holding up well. The industrial  market remains solid
and once again our  experience is that  developments  of smaller units for owner
occupiers have sold well.

The  construction  and plant hire  businesses saw strong demand  throughout 2007
with a broad  spread of work  across  their  markets and we expect this trend to
carry  forward  into 2008.  Our PFI  business  which  operates  the A69  between
Newcastle and Carlisle has also performed well and in line with expectations.

Taking each area of the business in detail:

PROPERTY

Our property division,  Henry Boot Developments,  made solid progress during the
year and  delivered  improved  results  compared  with 2006.  This was  achieved
through a combination  of land sales,  higher rental  income,  as the investment
property portfolio increases, the initial valuation of new developments and from
revaluation surpluses on our existing investment properties.

Although we have been aware that  confidence  in the wider  property  market had
been  weakening,  particularly  in the  second  half of 2007,  we  continued  to
identify   opportunities  in  our  property  development   portfolio  to  create
shareholder  value.  Our  development  schemes  have  to  pass a  tough  initial
appraisal  process  intended to target high returns based on prudent  completion
yield  assumptions.  This process is further  supported  by a stringent  ongoing
review in order to ensure schemes remain profitable on their progression through
to completion.  Therefore,  we have a number of significant schemes in progress,
some due for  completion  and initial  valuation in 2008,  on which we expect to
achieve a profitable outcome.

The most  notable  land sale in the year was at Ripon  where we agreed a sale to
the food  retailer,  Morrisons,  which  yielded  a better  profit  than had been
expected from the previously planned mixed-use  development.  Progress continued
on our Priory Park site in Hull and further profitable land disposals were made.
We expect to make additional land and property sales from this site during 2008.

Ayr Central Shopping Centre

Our new 220,000 sq ft retail scheme in Ayr achieved a £16.8m revaluation surplus
that was largely  booked at the half year and further  uplifted at the year end.
Further  lettings have been achieved to quality  retailers  such as River Island
and JD Sports. Though the Centre was not fully income producing at the year end,
we expect to let the few remaining units during 2008 and to derive a progressive
increase in car parking income as the scheme moves towards a fully let position.

The Axis, Nottingham

This award-winning  development is due for completion in mid-2008 with the final
17,000  sq ft  phase  of  offices,  where  a  letting  has  been  contracted  to
accountants,  Tenon Group Plc. We expect an uplift in  valuation to arise at the
end of  2008.  We have  identified  this  220,000  sq ft,  well  let,  mixed-use
development as having good rental growth  prospects and plan to retain it within
the Group's investment portfolio. The residential element of the scheme was sold
in 2007 to a specialist developer.

The Mall, Bromley

Completion  of the final  construction  phase of our  100,000  sq ft retail  and
office  development in Bromley was achieved early in 2008 and the anchor tenant,
Sportsworld,  has opened for trade.  Once  again,  it is  anticipated  that this
development  will generate a valuation uplift when first valued at the half-year
2008. The office accommodation and certain of the shop units remain unlet but we
are currently  seeing good levels of interest and anticipate  that the remaining
space, mainly competitively priced office areas, will be taken during 2008.

Stop 24 Motorway Service Area, M20

Stop 24, on Junction 11 of the M20 motorway in Kent, became the largest motorway
service  area in the  country  when the  development  completed  and  opened for
business in January 2008.  The retail and fast food areas are far more extensive
than  those  at  traditional  service  areas,  with  WH  Smith,  Julian  Graves,
Starbucks,  Burger King and KFC amongst the nine tenants so far signed up. There
is also strong  interest in a further three of the  remaining  five units and we
expect to see this investment property fully let during 2008.

Bromborough Retail Scheme

This 37,000 sq ft retail  warehouse  scheme in  Bromborough  is fully pre-let to
Homebase and Magnet. On completion,  provided market conditions allow, this is a
development we intend to market for sale. However, if the price offered does not
meet with our  expectations,  we will retain  this asset which will,  therefore,
contribute to profit either by initial valuation or sale during 2008.

Markham Vale Business Park, M1

Work has  continued  through 2007 on site  preparation  for this 200 acre scheme
that we are developing in partnership with Derbyshire  County Council which will
be  providing  both the new motorway  Junction 29a and the site  infrastructure.
Under our  agreement,  we acquire  land after it has been  brought to a standard
whereby it can be developed and during 2007,  we completed the initial  purchase
of 61 acres. We expect the first sites to be developed in 2008.  Markham Vale is
an ideal  location,  situated  adjacent  to the M1 almost  in the  centre of the
country,  and detailed  negotiations  are progressing with a number of occupiers
and also with potential partners to construct a 585,000 sq ft distribution unit.

Our involvement on the Waterloo Square retail scheme in South Shields progressed
further with  preliminary  site works being undertaken prior to the construction
of a new 60,000 sq ft ASDA store which will be  completed  by late 2008.  In the
meantime,  the  retail  complex  let to BHS,  Debenhams,  Next and River  Island
continues to perform well.

Two schemes are in hand at Clifton Moor Retail Park,  York, where the Company is
converting  a former  18,000  sq ft  nightclub  into  retail  accommodation  and
contracts have been exchanged with PC World to lease a 25,000 sq ft retail unit.
Construction is due to commence shortly and will be completed early in 2009.

Further  infrastructure  investment  was made to access  additional  land at the
Priory Park  scheme in Hull where we are  developing  a further  60,000 sq ft of
industrial  space  and,  in  partnership,  a further  30,000  sq ft of  offices.
Additional  accommodation  is being  developed on a  design-and-build  basis for
freehold sale.

In Stoke-on-Trent,  a sophisticated new 123,000 sq ft manufacturing  facility is
being developed on our 18 acre Meir Park scheme, leased to Recticel (UK) Limited
as their UK headquarters. We have a further planning permission on this site for
200,000 sq ft of industrial  warehouse  development  and are in discussion  with
prospective tenants for this property.

Detailed planning  permission has been granted for our retail and leisure scheme
in  Worksop.  Presently,  we are  resolving  some  technical  design  issues and
anticipate  a start on site in the  second  half of 2008.  Tesco  has  taken the
retail element of this development  which will now enable the cinema,  fast food
and other leisure outlets to proceed.

We have completed the purchase of a 16 acre development site in Rotherham,  with
planning  consent  for  100,000 sq ft of retail  and 90,000 sq ft of  industrial
space.  The site is adjacent to British Land's  Parkgate  retail park and we are
currently in discussion with prospective  tenants with the intention of securing
occupiers in time to allow a start on site in late 2008.

Two development sites have been acquired in Bodmin,  Cornwall,  one of which has
planning consent for development as a 37,000 sq ft retail park and the second as
a 50,000 sq ft trade park.  Interest has been received,  not only from retailers
and trade park  occupiers,  but from other types of  prospective  tenants and at
this  stage  all  development  options  are  being  investigated  with a view to
securing the highest scheme return.

At Tamworth we are extending our land interests  beyond the Lower Gungate retail
scheme  which  we  already  own,  with  the  aim of  undertaking  a  substantial
redevelopment  including a large decked car park.  Discussions  are ongoing with
potential  tenants  and the  planning  authority  and we expect this to become a
significant future development.

We acquired a development site with detailed planning consent to create a 27,000
sq ft  extension  to the Baglan Bay Retail Park at Port  Talbot.  We are on site
with completion scheduled for June 2008. Two of the four units have been pre-let
to Halfords  and Dreams and  negotiations  are taking  place with other  parties
concerning the remaining space.

After many years of discussion,  it is hoped that 2008 will see the finalisation
of council plans for the  redevelopment of Beeston town centre which will enable
us to modernise  and expand our  existing  retail and  residential  development.
Beeston is a prosperous satellite town very close to Nottingham  University and,
as a consequence, we are seeing strong interest from high quality retailers.

We purchased a small,  well-located site in Bristol where we plan to develop and
sell eight two-storey offices totalling 25,000 sq ft to  owner-occupiers.  It is
intended to proceed with similar  developments  on land purchased at Maidenhead.
On the retail side, we are looking to progress  sizeable  schemes in partnership
with local  authorities at Falkirk,  Burnley and  Abergavenny,  though these are
more  likely to come  forward  after  2008.  In  addition,  we have  exchanged a
development agreement with Daventry District Council for a multi-site, mixed-use
town centre  redevelopment.  At  Weston-super-Mare we are working with the local
authority on the 196,000 sq ft Tropicana Leisure Centre scheme which has already
seen very good tenant  interest  and we are also  purchasing a small retail site
for  redevelopment.  Finally,  towards  the 2007 year end we acquired a 7.5 acre
industrial  site in  Cumbernauld  which  we  intend  to  develop  for a range of
commercial uses.

Whilst we  continue  to  investigate  many  more  opportunities  throughout  the
country,  any new scheme has to meet our stringent  investment criteria before a
commitment  is made to develop the site.  There is little doubt that the current
uncertainty  over funding,  particularly  for  speculative  or highly  leveraged
situations,  allied to a marketplace characterised by softer property yields and
fewer buyers, will produce opportunities to acquire interests with potential for
future development,  but we remain very mindful of the risk reward equation when
considering these opportunities.

Investment Property

The Group's investment and  owner-occupied  properties were valued externally by
Jones Lang LaSalle at 31 December  2007.  The Group's  investment  portfolio was
valued at £81.5m (2006:  directors'  valuation £30.1m).  The increase during the
year largely arose from the completion and initial valuation of our Ayr Shopping
Centre at £50.5m  which  gave rise to much of the  increase  in the  revaluation
surplus to £18.1m (2006:  £3.0m).  The Group's owner  occupied  properties  were
valued at £9.6m (2006:  £7.4m) with the revaluation surplus being taken directly
to reserves.

Rental Income

We expect  our  rental  income to  increase  significantly  during  2008 as more
lettings are secured and the schemes noted above reach  completion.  Gross rents
in 2008 should  exceed  £7.0m and are  therefore  well on the way to our initial
internal target of £10.0m. It is anticipated that rental income will continue to
increase as  rent-free  periods on retail and office  properties  expire so that
2009 should see us another step closer to the target.

LAND

Following  the record  profit  level  achieved in 2006,  Hallam Land  Management
Limited again  produced a strong set of results and is well placed for a further
good  performance in 2008.  After many years when operating  within the planning
regime has been very difficult,  there are now signs that Government actions and
initiatives  are releasing more planning  consents and are having some impact on
the backlog.  We have been more  successful in taking a number of  opportunities
through the planning system during 2007,  with the majority of our  applications
and appeals achieving success.

Although the absolute values were lower than in 2006, profitable land sales were
completed at Prestonpans,  Bathgate, Syston, Rotherham,  Sheffield,  Retford and
Peterborough  during the year,  whilst at Bognor Regis a significant  agency fee
was received in respect of the planning  promotion  agreement for a site of over
80 acres with consent for 700 units.

Land  sold for  residential  development  at  Swallownest  (Rotherham),  Oxclose
(Sheffield)  and Retford  provided a favourable  return on our investment in the
latter part of the year. The 54 acres of land optioned at Peterborough were sold
to an adjacent land owner/developer achieving a satisfactory result after eleven
years of planning promotion.

A major planning  permission was granted and, late in 2007,  successfully passed
through the judicial review period without  challenge for our holding within the
eastern expansion area of Milton Keynes.  Our interests here form  approximately
one-third of a very important  2,500-dwelling scheme and a sale was concluded in
early March 2008.

Following the receipt of a planning  consent for 23 acres of employment  land at
Market  Harborough,  a part sale to our joint partner should be completed in the
first half of 2008.  We expect to jointly  promote  and  subsequently  develop a
further 240 acres of land held in this area in future years.

Outline terms have been agreed with a national house builder for the sale of our
30%  interest in an 84 acre site at  Melksham,  Wiltshire.  At the year end, the
detailed  agreement for sale had yet to be  formalised.  However,  we anticipate
completion of this  transaction  later in 2008.  We purchased  land with outline
planning permission for 114 houses at Tillicoultry,  Clackmannanshire and, after
enhancement, anticipate a sale during 2008.

Planning has progressed well for an 18 acre site at Ampthill, Bedfordshire which
we have under  option.  Provided  the  consent is granted in our  favour,  it is
probable  that we will  conclude the purchase and sale of this land late in 2008
or early 2009.

A very large and complex land deal, bringing together a number of landowners, is
well advanced at Biddenham,  Bedfordshire, for a major 1,200-dwelling scheme for
which planning  consent is expected to be received in 2008. As a result of these
complexities,  it is  likely  that it will be 2009  before  the  agreements  are
completed and a sale is achieved.

Planning permission has been won on appeal for a residential development on a 30
acre site in Bedford and we expect to market this land during 2008.  Following a
residential  allocation,  we are  pressing  for an early  planning  consent  for
industrial  and  residential  development on part of the 92 acres of land in our
ownership and 480 acres jointly optioned at Kilmarnock.  If we are successful in
this  respect,  a land sale may be possible  during  2009.  We are also close to
being awarded planning  permission for a residential  development on our 41 acre
site in Banbury. If successful,  a sale of this land may be achieved during 2008
although a 2009 disposal is more likely.  Planning consent for 214 dwellings has
been granted on a 10 acre site at  Worcester  and sale of the land is planned in
the second half of 2008.

On appeal, our jointly owned 30 acre, mixed-use site close to the A1 at Bowburn,
County Durham, has been granted planning permission for residential development.
Significant land decontamination and remediation work will be required to enable
full implementation of the consent. However, outline terms have been agreed with
a regional house builder and a sale is anticipated during 2008.

A revised application has been submitted for residential development on 27 acres
of land at Rushpool Farm, Mansfield. The land was acquired some years ago and if
we obtain a planning  consent this site should  generate a particularly  healthy
return on sale.

During the year,  we expanded our  interests in land  allocated for a 2,900 home
scheme outside Exeter.  These large schemes involve  complex  negotiations  with
planning  authorities  and land  owners  before  they are  available  for  sale.
Therefore,  it is likely  that  this  major  scheme  will  come  forward  in the
medium-term.

There has been much press speculation with regard to the state of the UK housing
market and the conflicting  comments  regarding  short-term demand and long-term
undersupply.  House builders are reporting  weaker market  conditions  after the
significant rise in interest rates, the problems in the sub-prime lending market
and the effect this has had on Inter-Bank interest rates and the availability of
mortgage  credit.  In  addition,  house  builders  are  having  to pay for local
authority Section 106 requirements  which often equate to a de facto development
tax of up to 20% of land value,  provide an affordable  housing content of up to
50% of all the dwellings in a development  and will,  from Spring 2009,  have to
contend with the  Community  Infrastructure  Levy.  These and other cost burdens
being loaded onto residential  developers will put pressure on their margins. In
this  environment,  we believe house  builders will attack their cost base in an
effort to  safeguard  their  margins.  We  anticipate  that the price of land is
likely to become more competitive,  although we believe the market will continue
to bid strongly for well located sites.

Therefore,  a land bank of high quality,  desirable and deliverable sites, as we
believe the Company's to be, is vital to achieve  success in the more  difficult
market conditions  anticipated over the next year or two. At the end of 2007, we
held  interests  in a total of 6,725  acres of land,  of which 1,660 were owned,
3,712 were  optioned  and 1,353 were held under  agency  agreements  in over 170
schemes  throughout the country.  Having disposed of 184 acres in 2007, we added
409 acres to our  portfolio to show a net increase of 225 acres during the year.
We continue  to actively  seek out further  opportunities  and,  almost  without
exception,  good  progress is being made  taking  schemes  through the  planning
process. Our teams throughout the country endeavour to acquire interests in land
which,  even in the most  difficult of markets,  house builders would put at the
top of their  acquisition lists and we remain optimistic that we can continue to
achieve attractive returns into the future.

CONSTRUCTION

Henry Boot Construction (UK) Limited achieved another  operationally  successful
and  profitable  year as we  continued  to benefit  from our policy of carefully
selecting the type of building sector  contracts  carried out and minimising our
exposure to risk wherever possible.

Competition  in the  marketplace  remained  strong,  but we were well  served by
continuing to deliver high levels of quality  workmanship,  customer service and
satisfaction  through a well trained and  experienced  workforce.  We were short
listed for the 2007 Regional Contractor of the Year by 'Contract  Journal',  the
national  industry  magazine.  The development of company  operations during the
year was enhanced by the further  expansion  of key  partnering,  framework  and
negotiated  contracts,  predominantly in the Decent Homes,  prison and education
sectors.

Our involvement in social housing refurbishment  increased substantially when we
were appointed as one of the construction  partners to deliver a six year, £300m
Decent Homes improvement  programme  involving the upgrade of some 22,000 houses
for St Leger Homes, a company formed by Doncaster  Metropolitan Borough Council.
In addition,  we continue to work alongside  partner  contractors on three other
major Decent Homes schemes - for Sheffield  City Council on the largest  project
of  its  type  in  the  country  managed  by  Sheffield   Homes,  for  Rotherham
Metropolitan  Borough Council on a 22,500 homes programme being  administered by
2010 Rotherham and for Hull City Council on the  improvement of 336 flats within
three multi-storey  tower blocks.  With the exception of Hull, it is anticipated
that these projects will continue over a three to six year period.

As a result of our Preferred  Alliance  Contractor  Agreement  with the National
Offenders   Management   Service,  we  carried  out  a  number  of  upgrade  and
refurbishment  contracts within secure  establishments  during the year. Looking
ahead,  we  have  secured  several  new  projects,   with  others  currently  in
negotiation, and these will provide good levels of growth within this sector.

The  year  also  saw new  educational  facilities  completed  under a  Framework
Agreement  with  Cheshire  County   Council,   with  others  in  the  course  of
construction.  We are also  partners  under similar  agreements  with Derby City
Council  and  Lancashire   County  Council  for   non-housing   and  educational
refurbishment  and new build  schemes.  In  Rotherham,  we undertook a number of
school  extension and  modernisation  projects  through our  involvement  in the
Rotherham   Construction   Partnership.   In  addition,   work  started  on  the
construction  of  a  new  60-bed  residential  care  home  at  Dinnington,  near
Rotherham.

Our General Works Division achieved further growth in its mainstream activity of
civil engineering  contracts in the industrial and water sectors.  This was once
again  augmented by  increasing  business in smaller  contracts  across  various
sectors.  As ever,  a key feature of the  division's  success was its ability to
secure repeat work for satisfied clients.

Important  contract  completions  achieved  in  the  year  included  an 11  acre
state-of-the-art  garden centre and retail scheme for Dobbies  Garden Centres at
Barlborough, Sheffield, and a major refurbishment of the Drakehouse Retail Park,
Sheffield for Hammerson  Plc.  These  projects were completed on time and budget
and we hope to undertake further projects for these clients in the future.

ROAD LINK (A69)

Our 30 year PFI  contract to operate  and  maintain  the A69  Newcastle-Carlisle
trunk road for the Highways  Agency in which we have a 61.2% stake  continues to
perform well. The planned  maintenance  programme continues to be implemented in
both an  efficient  and cost  effective  manner and the  priority  objective  of
providing a safe, free-flowing highway is being achieved.

Throughout  the  contract  we have been  prompt  in  attending  to  repair  when
maintenance  items have arisen.  As a result,  the  indications  are that we are
benefiting  from a  reduction  in the rate of  deterioration  in both the road's
surfacing  and  underlying  structure.  This will enable us to fulfil our future
contractual  repair  obligations more cost effectively than was envisaged in the
original project plan.

Statistics show that,  during year eleven of our 30 year contract,  that part of
the A69 for which Road Link is responsible  carried vehicles over a total of 553
million vehicle kilometres.

PLANT

Our plant hire  business,  Banner  Plant  Limited,  delivered  a strong  trading
performance,  particularly in the second half,  arising from healthy demand from
all segments of the construction industry, allied to targeted capital investment
and increased efficiency which resulted in high levels of plant utilisation.

Increasing  capital  investment within key product categories - large industrial
air  compressors,  accommodation  units  and  powered  access  equipment  -  has
undoubtedly  expanded the company's  client base and its reputation as a leading
regional operator in its field. We also continued our replacement  programme for
general plant items, increasing the unit hire fleet by a further 10% overall.

The year's  outstanding  depot  performance  was from the powered  access centre
based in Rotherham which, helped by strong capital  investment,  posted a record
profit for any of our hire  centres.  We relocated and enlarged our hire centres
in Wakefield and Derby during the first half of the year and,  although turnover
was affected because of the initial inconvenience of the relocation, by mid-year
both centres had  re-established  their  operational base and were trading well.
Towards the end of the year, we  efficiently  integrated  the Leeds and Bradford
tool hire depots onto one location.

As ever,  efficient  administration  is at the heart of any successful  business
and, having introduced new financial systems in 2006, we reorganised our finance
function  which,  together with a much improved  credit control  system,  led to
lower bad debts and  receivables  as a  percentage  of  turnover  and  therefore
improved cash flow over the year.

Looking to 2008 our customers  have carried good  construction  order books into
the  current  year  and  we  feel  we are  well  positioned  to  cope  with  any
uncertainties in the market in 2008.

FINANCIAL REVIEW

RESULTS
Profit and Loss

Net  revenue  for the year was £124.8m  (2006:  £142.3m) as higher  construction
revenues were offset by lower land sales as fewer  transactions  were brought to
market. Profit before tax increased 14% to £46.5m (2006: £40.8m) after inclusion
of the property  revaluation  surplus of £18.1m (2006:  £3.0m),  largely arising
from Ayr.  Realised profits on the sale of investment  properties and properties
under  construction,  mostly  arising from the sale of Ripon,  were £3.5m (2006:
£1.4m).  Administrative  and pension expenses were £0.3m higher at £13.6m (2006:
£13.3m) primarily  resulting from the investment in additional  headcount across
the Group, offset by slightly lower pension expenses.

Comparing  the  segmental  profit  analysis  shows  that the  property  and land
development   profits,   including   the  initial   revaluation   of   completed
developments,  increased by 23% to £47.3m (2006:  £38.6m).  Within this caption,
land trading  profits were £22.9m (2006:  £28.0m) and property  development  and
investment  profits were £24.4m (2006:  £10.6m).  Construction  division profits
were stable at £7.6m (2006:  £7.6m) and central costs  slightly  higher at £4.5m
(2006: £4.3m).

Basic earnings per share were 24% higher at 24.5p (2006:  19.8p). Total dividend
payable  for the year  rises  14% to 5.0p  (2006:  4.4p),  with  dividend  cover
increasing to 4.9 times (2006: 4.4 times).

Financing and Gearing

As anticipated,  net interest costs increased to £3.8m (2006:  £1.1m) as we made
significant  investments in the land,  development  and  investment  portfolios.
Interest cover,  expressed as the ratio of profit from operations (excluding the
valuation  movement on investment  properties and disposal profits) to interest,
was eight times  (2006:  35 times).  Although  higher  than last year,  interest
expenses  are likely to fall in 2008 as the  combination  of lower  average debt
levels and  anticipated  interest  rates  combine to reduce  cost.  No interest,
incurred  during  the  year or the  previous  year,  has been  capitalised  into
development costs.

The aforementioned investment in our asset base saw year end borrowings increase
to £70.9m (2006:  £15.9m).  Gearing, on net assets of £182.2m was 39% (2006: net
assets  £152.2m,  gearing 10%).  All borrowings  continue to be from  facilities
linked to floating rates or short-term fixed commitments. Consideration is given
to the need  for  alternative,  longer-term  funding  as and  when  appropriate.
However,  longer-term  funding is currently not  considered  necessary as strong
operational  cash flows  anticipated  in 2008 are  expected  to reduce  debt and
therefore gearing during the year.

Taxation

The tax charge for the year is £13.7m (2006:  £14.0m)  representing  a charge of
29.4% (2006:  34.3%).  The lower  percentage  charge primarily arises from lower
levels of disallowed  construction expenses compared with 2006. Deferred tax has
been calculated at 28%, being the rate expected to be applicable at the date the
actual tax will arise.

Cash flow

The  strategy of  retaining  investment  properties  alongside  the  development
portfolio resulted in cash outflows of £55.0m after net expenditure of £52.5m on
property,  plant and equipment and £23.9m on land holdings, in particular Milton
Keynes.  Net cash  inflow  from  operating  activities  reduced to £4.0m  (2006:
£26.2m) after  significantly  higher net investment in working capital of £13.1m
(2006:  £4.0m),  increased interest costs and higher taxation payments of £13.5m
(2006:  £11.0m),  primarily  arising from higher  taxable  profits in 2006,  and
payments on account for 2007 profits. These outflows were only marginally offset
by property  disposals  of £7.5m,  compared to £16.3m in 2006.  Dividends  paid,
including those to minorities,  totalled £7.2m (2006: £6.1m) as we continued our
progressive dividend policy.

Balance sheet

The policy of progressive  investment in the development portfolio noted in this
business review  underlies the £55.3m increase in property,  plant and equipment
to £154.9m.  It is anticipated that this investment will continue during 2008 as
we finally complete developments at Bromley, Nottingham,  Saltwood,  Bromborough
and Stoke-on-Trent, whilst commencing developments at Markham Vale, Port Talbot,
Bristol and Maidenhead. The inclusion of Ayr in the investment portfolio was the
main change  behind the increase in value to £81.5m  (2006:  £30.1m).  The total
investment in non-current assets stood at £248.5m (2006:  £143.3m).  Net current
assets  reduced £88.2m to become net current  liabilities  of £19.6m (2006:  net
current  assets  £68.6m) due to the increase in trade  payables and  borrowings.
Non-current liabilities also reduced by £13.0m as non-current borrowings reduced
to £17.6m  (2006:  £28.1m) and the pension  scheme  deficit  fell to £22.5m from
£25.8m.  Net assets  increased  £30.0m to £182.2m (2006:  £152.2m) and net asset
value per share increased 20% to 139p (2006: 116p).

Pension scheme

The annual IAS 19 valuation of the defined  benefit  pension  scheme  showed the
scheme deficit  reducing to £22.5m (2006:  £25.8m) at the year end. The deferred
tax asset associated with this was £6.3m from £7.7m last year.  Adding back this
net deficit of £16.2m (2006:  £18.1m) to net assets, the 2007 deficit equates to
8.2% of equity  shareholders  funds (2006:  10.7%). The reduction in the deficit
benefited  from an  increase  in  long-term  interest  rates  and the  level  of
commutation,  offset by  increases  in the  scheme  mortality  assumptions.  The
scheme's  assets  performed  well  in the  period  and  the  trustees  took  the
opportunity to switch part of the scheme's holdings from equities to debt during
the year. The Scheme Actuary performed the triennial valuation at 1 January 2007
which  showed a deficit of £8.8m.  The  comparatively  lower  deficit  than that
calculated  under  IAS  19 is  principally  due  to  the  allowance  for  equity
out-performance  in  the  triennial   valuation  (not  allowed  in  the  IAS  19
calculation).  In the scheme each 0.1% increase in assumed long-term  investment
return  reduces  the scheme  deficit by about  £3.0m.  The  Company has agreed a
recovery plan with the trustees of the scheme which includes the provision of an
'on demand' letter of credit for £7.0m and additional  annual  contributions  of
£0.7m,  with the 2007  contribution  charged in the year.  The  defined  benefit
scheme  is  closed  to new  entrants  and new  employees  are  offered a defined
contribution scheme.


Group Income Statement                                                            2007       2006
for the year ended 31 December 2007                                              £'000      £'000
_________________________________________________________________________________________________

Revenue                                                                        124,782    142,284
Cost of sales                                                                 (82,419)   (91,496)
_________________________________________________________________________________________________
Gross profit                                                                    42,363     50,788
Other income                                                                        49         27
Administrative expenses                                                       (12,133)   (11,479)
Pension expenses                                                               (1,460)    (1,855)
_________________________________________________________________________________________________
                                                                                28,819     37,481
Increase in fair value of investment properties                                 18,063      3,032
Profit on sale of properties under construction                                  3,379          -
Profit on sale of investment properties                                            120      1,381
_________________________________________________________________________________________________
Profit from operations                                                          50,381     41,894
Investment income                                                                  361        641
Finance costs                                                                  (4,195)    (1,740)
_________________________________________________________________________________________________
Profit before tax                                                               46,547     40,795

Taxation                                                                      (13,677)   (14,008)
_________________________________________________________________________________________________
Profit for the year from continuing operations                                  32,870     26,787
_________________________________________________________________________________________________
Attributable to:
Equity holders of the parent                                                    31,428     25,415
Minority interest                                                                1,442      1,372
_________________________________________________________________________________________________
                                                                                32,870     26,787
_________________________________________________________________________________________________
Basic earnings per ordinary share                                                24.5p      19.8p
_________________________________________________________________________________________________
Diluted earnings per ordinary share                                              24.1p      19.5p
_________________________________________________________________________________________________
Dividend                                                                          5.0p       4.4p
_________________________________________________________________________________________________



Group Balance Sheet                                                               2007       2006
at 31 December 2007                                                              £'000      £'000
_________________________________________________________________________________________________

ASSETS

Non-current assets

Goodwill                                                                         3,392      3,595
Property, plant and equipment                                                  154,937     99,595
Investment property                                                             81,458     30,130
Deferred tax assets                                                              8,709      9,941
_________________________________________________________________________________________________
                                                                               248,496    143,261
_________________________________________________________________________________________________

Current assets

Inventories                                                                     83,403     94,736
Trade and other receivables                                                     28,809     17,592
Cash and cash equivalents                                                        2,326     15,044
_________________________________________________________________________________________________
                                                                               114,538    127,372
_________________________________________________________________________________________________

LIABILITIES

Current liabilities

Trade and other payables                                                        55,259     31,830
Current tax liability                                                           11,886     11,739
Borrowings                                                                      55,702      2,801
Provisions                                                                      11,291     12,401
_________________________________________________________________________________________________
                                                                               134,138     58,771
_________________________________________________________________________________________________
Net current (liabilities) assets                                              (19,600)     68,601
_________________________________________________________________________________________________

Non-current liabilities

Borrowings                                                                      17,556     28,141
Employee benefits                                                               22,454     25,813
Deferred tax liabilities                                                         6,523      5,585
Provisions                                                                         144        144
_________________________________________________________________________________________________
                                                                                46,677     59,683
_________________________________________________________________________________________________
Net assets                                                                     182,219    152,179
_________________________________________________________________________________________________

EQUITY

Share capital                                                                   13,424      3,005
Revaluation reserve                                                              4,809      2,908
Retained earnings                                                              160,759    142,843
Other reserves                                                                   2,623      2,610
Cost of shares held by ESOP trust                                              (1,033)      (740)
_________________________________________________________________________________________________
Equity shareholders' funds                                                     180,582    150,626
Minority interests                                                               1,637      1,553
_________________________________________________________________________________________________
TOTAL EQUITY                                                                   182,219    152,179


Group Statement of Changes in Equity                                              2007       2006
at 31 December 2007                                                              £'000      £'000
_________________________________________________________________________________________________

Profit for the year                                                             31,428     25,415
Equity dividends                                                               (5,881)    (5,016)
Revaluation of group occupied property                                           2,778        140
Deferred tax on property revaluations                                            (695)       (28)
Tax on realised surplus                                                           (33)          -
Actuarial gain on defined benefit pension scheme                                 3,359     11,918
Deferred tax on actuarial gain                                                 (1,457)    (3,575)
Movement in fair value of cash flow hedges                                          62        506
Share based payments                                                             (293)         55
Arising on employee share schemes                                                  688        206
_________________________________________________________________________________________________
Movement in equity                                                              29,956     29,621
Equity at 1 January                                                            150,626    121,005
_________________________________________________________________________________________________
Equity at 31 December                                                          180,582    150,626
_________________________________________________________________________________________________


Group Cash Flow Statement                                                         2007       2006
for the year ended 31 December 2007                                              £'000      £'000
_________________________________________________________________________________________________

Cash flows from operating activities

Profit from operations                                                          50,381     41,894
Adjustments for non-cash items:
Depreciation of property, plant and equipment                                    4,858      4,701
Property impairment                                                                157          -
Goodwill impairment                                                                203        204
Revaluation increase in investment properties                                 (18,063)    (3,032)
Gain on disposal of property, plant and equipment                              (3,701)      (263)
Gain on disposal of investment properties                                        (120)    (1,381)
_________________________________________________________________________________________________
Operating cash flows before movements in working capital                        33,715     42,123
Increase in inventories                                                       (23,890)   (11,355)
(Increase) decrease in receivables                                            (11,510)      4,847
Increase in payables                                                            22,308      2,532
_________________________________________________________________________________________________
Cash generated from operations                                                  20,623     38,147
Interest received                                                                  361        636
Interest paid                                                                  (3,434)    (1,599)
Taxation                                                                      (13,545)   (10,976)
_________________________________________________________________________________________________
Net cash from operating activities                                               4,005     26,208
_________________________________________________________________________________________________

Cash flows from investing activities

Purchase of property, plant and equipment                                     (59,258)   (32,228)
Proceeds on disposal of property, plant and equipment                            6,719      1,391
Proceeds on disposal of investment properties                                      739     14,872
_________________________________________________________________________________________________
Cash flows from investing activities                                          (51,800)   (15,965)
_________________________________________________________________________________________________

Cash flows from financing activities

Dividends paid:
Ordinary shares                                                                (5,860)    (4,995)
Minorities                                                                     (1,358)    (1,067)
Preference                                                                        (21)       (21)
_________________________________________________________________________________________________
Cash flows from financing activities                                           (7,239)    (6,083)
_________________________________________________________________________________________________
Net (decrease) increase in cash and cash equivalents                          (55,034)      4,160
Opening net debt                                                              (15,898)   (20,058)
_________________________________________________________________________________________________
Closing net debt                                                              (70,932)   (15,898)
_________________________________________________________________________________________________



NOTES
     
1.   Business and geographical segments


                    Year ended 31 December 2007            Year ended 31 December 2006
                                   Inter-                                      Inter-
                      External    segment                       External      segment
                         sales      sales        Total             sales        sales        Total
                         £'000      £'000        £'000             £'000        £'000        £'000
Revenue
Property and land
development             47,790        242       48,032            80,938          241       81,179
Construction            76,988      4,546       81,534            61,285        4,950       66,235
Group overheads and
other                        4        573          577                61          528          589
__________________________________________________________________________________________________
                       124,782      5,361      130,143           142,284        5,719      148,003
Eliminations                 -    (5,361)      (5,361)                 -      (5,719)      (5,719)
__________________________________________________________________________________________________
                       124,782          -      124,782           142,284            -      142,284
__________________________________________________________________________________________________


                                                                  2007                               2006
                                                                 Total                              Total
                                                                 £'000                              £'000
_________________________________________________________________________________________________________
Result
Property and land development                                   47,275                             38,586
Construction                                                     7,641                              7,610
Group overheads and other                                      (4,535)                            (4,302)
_________________________________________________________________________________________________________
Segment result                                                  50,381                             41,894
Investment income                                                  361                                641
Finance costs                                                  (4,195)                            (1,740)
_________________________________________________________________________________________________________
Profit before tax                                               46,547                             40,795
Taxation                                                      (13,677)                           (14,008)
_________________________________________________________________________________________________________
Profit for the year                                             32,870                             26,787
_________________________________________________________________________________________________________


For management  purposes,  the Group is currently  organised into three business
segments:  Property and Land  Development,  Construction and Group overheads and
other.  As  operations  are  carried  out  entirely  within the UK,  there is no
secondary  segmental  information.  Inter  segmental  pricing is done on an arms
length open market basis.



2.   Dividends


                                                                                      2007             2006
                                                                                     £'000            £'000
___________________________________________________________________________________________________________
Amounts recognised as distributions to equity holders in year:
Preference dividend on cumulative preference shares                                     21               21
Final dividend for the year ended 31 December 2006 of 3.32p per share
(2005: 2.82p)                                                                        4,257            3,612
Interim dividend for the year ended 31 December 2007 of 1.25p per share
(2006: 1.08p)                                                                        1,603            1,383
___________________________________________________________________________________________________________
                                                                                     5,881            5,016
___________________________________________________________________________________________________________

     The proposed  final  dividend for the year ended 31 December  2007 of 3.75p
     per share (2006:  3.32p) makes a total dividend for the year of 5.0p (2006:
     4.4p).  The proposed final dividend is subject to approval by  shareholders
     at the Annual  General  Meeting and has not been included as a liability in
     these  financial  statements.  The total  estimated  dividend to be paid is
     £4,802,000.  The final dividend will be paid on 22 May 2008,  with a record
     date of 9 May 2008.


3.   The  financial  information  above  has been  extracted  from  the  group's
     statutory accounts for the years ended 31 December 2006 and 2007. Statutory
     accounts for the year ended 31 December 2006 have been delivered, and those
     for the year ended 31 December 2007 will be delivered,  to the Registrar of
     Companies.  The auditors of the Company have given  unqualified  reports on
     those  accounts and such reports did not contain a statement  under Section
     237(2) or (3) of the Companies Act 1985.

4.   The  financial  statements  were  approved by the Board of  Directors on 18
     March 2008 and authorised for issue.

5.   The Annual  Report 2007 is to be published and sent to  shareholders  by no
     later than Friday 11 April 2008.  Copies will be available from The Company
     Secretary, Henry Boot PLC, Banner Cross Hall, Sheffield, S11 9PD and on the
     Company's website www.henryboot.co.uk.

6.   The financial  information  has been  prepared  using  accounting  policies
     consistent with those adopted by the Group in its financial  statements for
     the year ended 31 December 2006.

7.   The Annual General  Meeting of the Company is to be held at Baldwins Omega,
     Brincliffe Hill, Off Psalter Lane,  Sheffield,  S11 9DF on Wednesday 14 May
     2008 commencing at 11.30 a.m.




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