Interim Results

Bovis Homes Group PLC
10 September 2007






                             BOVIS HOMES GROUP PLC

                                INTERIM RESULTS
                     for the six months ended 30 June 2007

                            Issued 10 September 2007

The Board of Bovis Homes Group PLC today announced its interim results for 2007.

  • Strong growth in pre-tax profit, up by 10.0%, to £58.4 million (2006*:
    £53.1 million)
  • Good earnings per share increase of 8.9% to 34.2 pence (2006*: 31.4
    pence)
  • Attractive interim dividend increase as the Group rebalances its interim
    and final dividend payments: up by 75% to 17.5p net per ordinary share
    (2006: 10.0p)
  • High operating margin of 22.5% versus 22.7% in 2006*
  • Continuing positive cash management with cash in hand
  • Plots with planning consent at 11,674 plots (owned: 11,262 plots /
    controlled third party owned: 412 plots)
  • Strategic landholdings at 24,594 potential plots

    * 2006 comparatives stated before a one off pension credit of £3.5 million
    (2007: £nil)


Commenting on the results, Malcolm Harris, Chief Executive of Bovis Homes Group
PLC said:

'The Group's first six months' profits have been good, generating a strong
operating margin and supported by a solid balance sheet. Interest rate rises
have softened the market and as future movements remain uncertain, consumers are
reacting cautiously. The Group continues to anticipate an increase in volume
ahead of that delivered in 2006.'


Enquiries: 
Malcolm Harris, Chief Executive 
Neil Cooper, Group Finance Director 
Bovis Homes Group PLC 
Monday 10 September - Tel: [phone]
Thereafter - Tel: [phone]

Results issued by: Andrew Best /Emily Bruning
Shared Value Limited
Tel: [phone] / 5027



Chairman's interim statement

Bovis Homes Group PLC is pleased to announce its interim results for the six
months ended 30 June 2007. With 10.0% pre-tax profit growth and earnings per
share growth of 8.9%, the Group has delivered a good set of results for the
first half of the year despite a backdrop of rising interest rates during this
period. The Group's interim dividend per share has been increased by 75%, which
is reflective of the Group's decision to re-balance the annual dividend payments
between interim and final whilst maintaining its existing commitments in terms
of its full year dividend.

Results

For the six months ended 30 June 2007 the Group achieved a pre-tax profit of
£58.4 million as compared to £53.1 million in the same period in 2006 (stated
before a one off pension credit of £3.5 million). At 10% growth, this represents
good progress by the Group. As a result of this progress, basic earnings per
share improved by 8.9% to 34.2p as compared with 31.4p in the prior first half,
stated before the one-off pension credit.

At £259.9 million, total Group revenue grew by 3.8% (2006: £250.5 million).
Within this, the volume of legal completions was maintained, with 1,256 homes
legally completed, as compared to 1,262 homes in the same half in the previous
year. Of these, 13% or 164 units arose from social housing; a slightly higher
proportion than that seen in 2006, where 141 units or 11% arose from social
housing.

The Group's average sales price for the first half of 2007 was £189,600 compared
to £188,700 for the comparable six months of 2006, representing a 0.5% year over
year increase. This increase has arisen as a result of pricing gains on a
square-footage basis, with the average sales price per square foot growing by
3.8%. Offsetting this, and as a result of an increase in the selling mix of
smaller one and two bedroom homes, the average size of homes sold reduced to 
995 square feet, from the previous year's first half average of 1,028 square 
feet, reflecting the Group's successful transition to selling good quality, 
mid-market homes.

Land sales totalled £19.1 million as compared to £10.2 million in the first half
of 2006, demonstrating both the ongoing strength in the land market, and the
weighting of planned land sales to the first half in 2007.

The Group was able to hold its operating margin broadly in line in the first
half of 2007, as compared to the same period in 2006, with a margin of 22.5% as
compared to 22.7% (stated before the one off pension credit). This outcome
benefited from good control of overhead expenditure during the period.

Dividends

The interim dividend of the Company will amount to 17.5p net per share, an
increase of 75% over 2006's interim dividend of 10.0p. This dividend will be
paid on 23 November 2007 to holders of ordinary shares on the register at the
close of business on 28 September 2007. The Group continues to anticipate a 2007
full year dividend of 35.0p net per share, but has made a decision to alter the
proportion of the full year dividend traditionally paid at the interim, from
around 33% to around 50% of the anticipated full dividend, reflecting the
current strong cash position of the Group. This will give shareholders both the
advantage of receiving dividends in a more balanced way and a timing benefit in
2007.

The Board reiterates its previously advised statement in respect of dividends
which is that it intends, conditional on any necessary approvals required at
future general meetings, to increase the full year dividend for 2007 to 35.0p
net per share followed by a 5.0p per share increase in 2008. This commitment,
which is subject to a stable business environment, will double the full year
dividend to 40.0p net per share from its 2004 base of 20.0p.

The Board intends to offer a scrip dividend alternative, pursuant to which the
shareholders may elect to receive the whole or part of their dividend in new
ordinary shares credited as fully paid instead of cash, for the 2007 interim
dividend.

The Board also anticipates making a statement on its future intentions in
respect of dividends beyond 2008 at the time of its 2007 preliminary results
announcement in March 2008.

Borrowings and financing

Following a period of good cash generation, the Group enjoyed net cash in hand
at 30 June 2007 of £108 million: up slightly from the cash position at the end
of 2006 which was £103 million. Net borrowing during this period was minimal, as
was the Group's net financing charge, at £0.1 million (2006: £3.8 million).
Including land creditors, effective average gearing was negligible over the
first half of 2007 at 2%.

Of this net financing charge, around £2.4 million (2006: £1.1 million) relates
to non-cash imputed interest arising from land creditors, and reflects the
increased level of land creditors held on the balance sheet as at 30 June 2007
versus 2006. The balance is largely income arising from cash on deposit, offset
by cash interest arising from the Group's borrowings.

Land

The Group has continued to pursue its twin-track strategy of acquisition and
promotion of strategic land, alongside the acquisition of consented land,
although the Group's caution in acquiring consented land has continued into
2007. The controlled and consented land bank now stands at 11,674 plots, as
compared with 12,395 plots at the end of 2006.

The strategic land bank at 30 June 2007 stood at 24,594 potential plots as
compared to 24,719 potential plots held at the start of the year. The Group
remains well placed on a number of its major strategic projects with good
potential to be converted into the consented land bank in the second half of
2007. A number of additional attractive new opportunities are being progressed
which the Group believes will assist in replenishing its strategic land bank.

Pensions

As at 30 June 2007, the Group's actuary estimated that the Group's defined
benefits pension scheme had swung from a deficit of £5.1 million to a small
surplus of £2.8 million. The drivers of this change were twofold: firstly the
last in a series of agreed special contributions made by the Group to the
scheme, in this case totalling £2.0 million; secondly, the favourable impact
arising from the actuarial assumptions applied to the estimation of the scheme's
liabilities, in particular the movement in the assumption for the discount rate
derived from bond yields, which has had regard to market movements since the end
of the previous year. Looking ahead, there is a triennial valuation of the
scheme as at 30 June 2007 in progress.

Cumulative reservations

The Group held cumulative reservations for 2007 legal completion for 2,282 homes
as at 30 June 2007 as compared to 2,273 homes at the same point in 2006 which
represented a small increase in volume.

Market conditions

With interest rates increasing both in late 2006 and persistently during 2007,
the market has begun to show signs of a slowing rate of growth in house prices.
What is also apparent is that the positive national statistics on house price
inflation produced by a number of market commentators benefit markedly from
exceptional strength in London, and to a lesser degree Scotland and Northern
Ireland. The Group does not trade in any of these markets. In the geographic
markets in which the Group trades, progress for the Group has been steady, but
not exceptional, with cancellation rates broadly consistent with prior years.
However, consumers appear to be taking longer in their decision-making, given
uncertainty over the direction of interest rates going forward.

Prospects

Looking forward, the Group is confident in its ability to procure and promote
strategic land at a discount to market, and to build and sell attractive, good
quality mid-market homes at a competitive price.

Based on the trends seen in the market during the first half of 2007, the Group
anticipates making progress in terms of volume growth against 2006.

Tim Melville-Ross
Chairman
10 September 2007


Bovis Homes Group PLC

Group income statement
For the six months          Six months           Six months         
ended 30 June 2007               ended                ended         Year ended
                          30 June 2007         30 June 2006        31 Dec 2006
                            (unaudited)          (unaudited)          (audited)
                                £000                 £000               £000
--------------------------------------------------------------------------------

Revenue                      259,931              250,495            597,290
Cost of sales               (175,301)            (167,402)          (407,204)
--------------------------------------------------------------------------------
Gross profit                  84,630               83,093            190,086
Administrative expenses      (26,116)             (22,748)           (48,803)
--------------------------------------------------------------------------------
Operating profit
before financing
costs                         58,514               60,345            141,283
Financial income               3,258                   74                654
Financial expenses            (3,363)              (3,860)            (6,453)
--------------------------------------------------------------------------------
Net financing costs             (105)              (3,786)            (5,799)
--------------------------------------------------------------------------------
Profit before tax             58,409               56,559            135,484
Income tax expense           (17,361)             (16,862)           (40,446)
--------------------------------------------------------------------------------
Profit for the period
attributable to
equity holders of
the parent                    41,048               39,697             95,038
--------------------------------------------------------------------------------

Earnings per share
--------------------------------------------------------------------------------
Basic                           34.2p                33.4p              79.8p
Diluted                         34.1p                33.3p              79.5p
--------------------------------------------------------------------------------

Dividend per share
charged in period            
--------------------------------------------------------------------------------
2006 final paid
May 2007                        20.0p                   -                  -
2006 interim paid
November 2006                      -                    -               10.0p
2005 final paid
May 2006                           -                 16.7p              16.7p
--------------------------------------------------------------------------------
                                20.0p                16.7p              26.7p
--------------------------------------------------------------------------------


Bovis Homes Group PLC

Group balance sheet
At 30 June 2007            30 June 2007   30 June 2006      31 Dec 2006
                             (unaudited)    (unaudited)        (audited)
                                   £000           £000             £000
--------------------------------------------------------------------------------

Assets
Property, plant and equipment    14,581         14,669           14,778
Investments                          22             23               22
Deferred tax assets               3,187          6,952            6,089
Trade and other receivables       2,734          3,301            2,850
Retirement benefit asset          2,830              -                -
--------------------------------------------------------------------------------
Total non-current assets         23,354         24,945           23,739
--------------------------------------------------------------------------------

Inventories                     745,898        775,121          758,078
Trade and other receivables      42,378         36,826           22,446
Cash                            132,829          9,816          142,841
--------------------------------------------------------------------------------
Total current assets            921,105        821,763          923,365
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total assets                    944,459        846,708          947,104
--------------------------------------------------------------------------------

Equity
Issued capital                   60,376         60,027           60,288
Share premium                   156,290        151,118          155,494
Hedge reserve                         4           (292)            (112)
Retained earnings               483,121        416,195          462,162
--------------------------------------------------------------------------------
Total equity attributable
to equity holders of the parent 699,791        627,048          677,832
--------------------------------------------------------------------------------

Liabilities
Bank loans                       24,995         20,265           25,100
Trade and other payables         35,358         23,384           44,264
Retirement benefit obligations        -          7,740            5,140
Provisions                        2,004          1,157            2,114
--------------------------------------------------------------------------------
Total non-current
liabilities                      62,357         52,546           76,618
--------------------------------------------------------------------------------

Bank loans                            -         20,152           15,060
Trade and other payables        165,480        132,612          159,368
Tax liabilities                  16,831         14,350           18,226
--------------------------------------------------------------------------------
Total current liabilities       182,311        167,114          192,654
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total liabilities               244,668        219,660          269,272
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total equity and liabilities    944,459        846,708          947,104
--------------------------------------------------------------------------------
These interim financial statements were approved by the Board of directors on 7
September 2007.


Bovis Homes Group PLC

Group statement of cash flows

For the six months        Six months           Six months         
ended 30 June 2007             ended                ended         Year ended
                        30 June 2007         30 June 2006        31 Dec 2006
                          (unaudited)          (unaudited)          (audited)
                                £000                 £000               £000
--------------------------------------------------------------------------------

Cash flows from
operating activities
Profit for the period         41,048               39,697             95,038
Depreciation                     698                  727              1,499
Financial income              (3,258)                 (74)              (654)
Financial expenses             3,363                3,860              6,453
Profit on sale of
property, plant
and equipment                     (1)                (102)              (120)
Equity-settled
share-based
payment expenses                (319)                 (29)               455
Income tax expense            17,361               16,862             40,446
--------------------------------------------------------------------------------
Operating profit
before changes in
working capital
and provisions                58,892               60,941            143,117
--------------------------------------------------------------------------------

(Increase)/decrease
in trade and
other receivables            (19,962)              36,123             51,099
Decrease in
inventories                   12,180                6,252             23,295
(Decrease)/increase 
in trade and
other payables                (2,998)             (28,538)            19,619
Decrease in
provisions and
employee benefits             (1,760)              (9,000)            (8,590)
--------------------------------------------------------------------------------
Cash generated
from operations               46,352               65,778            228,540
--------------------------------------------------------------------------------

Interest paid                 (2,475)              (3,313)            (5,829)
Income taxes paid            (18,257)             (15,840)           (35,342)
--------------------------------------------------------------------------------
Net cash from operating
activities                    25,620               46,625            187,369
--------------------------------------------------------------------------------

Cash flows from
investing activities
Interest received              2,960                   74                512
Acquisition of
property, plant
and equipment                   (520)                (764)            (1,668)
Proceeds from sale
of plant and
equipment                         20                  133                174
--------------------------------------------------------------------------------
Net cash from
investing
activities                     2,460                 (557)              (982)
--------------------------------------------------------------------------------

Cash flows from
financing activities
Dividends paid               (23,976)             (19,826)           (31,757)
Proceeds from the
issue of share
capital                          884                4,597              9,234
Repayment of
borrowings                   (15,000)             (15,000)           (15,000)
--------------------------------------------------------------------------------
Net cash from financing
activities                   (38,092)             (30,229)           (37,523)
--------------------------------------------------------------------------------

Net (decrease)/increase
in cash and cash
equivalents                  (10,012)              15,839            148,864
Cash and cash
equivalents at the
start of period              142,841               (6,023)            (6,023)
--------------------------------------------------------------------------------
Cash and cash
equivalents at the
end of period                132,829                9,816            142,841
--------------------------------------------------------------------------------


Bovis Homes Group PLC

Group statement of recognised income and expense

For the six months        Six months           Six months         
ended 30 June 2007             ended                ended         Year ended
                        30 June 2007         30 June 2006        31 Dec 2006
                          (unaudited)          (unaudited)          (audited)
                                £000                 £000               £000
--------------------------------------------------------------------------------

Effective portion of 
changes in fair value 
of interest rate cash 
flow hedges                      165                  385                642
Deferred tax on changes 
in fair value of 
interest rate cash 
flow hedges                      (49)                (116)              (193)
Actuarial gains on
defined benefits
pension scheme                 5,770                5,990              8,640
Deferred tax on
actuarial movements 
on defined benefits
pension scheme                (1,886)              (1,797)            (2,592)
Deferred tax on other 
employee benefits               (471)                   -                218
--------------------------------------------------------------------------------
Net income recognised
directly in equity             3,529                4,462              6,715
Profit for the period         41,048               39,697             95,038
--------------------------------------------------------------------------------
Total recognised income 
and expense for the 
period attributable to
equity holders of
the parent                    44,577               44,159            101,753
--------------------------------------------------------------------------------


Notes to the accounts

1 Basis of preparation

Bovis Homes Group PLC ('the Company') is a company domiciled in the United
Kingdom. The consolidated interim financial statements of the Company for the
six months ended 30 June 2007 comprise the Company and its subsidiaries
(together referred to as 'the Group') and the Group's interest in associates.

The interim financial statements were authorised for issue by the directors on 7
September 2007. The financial statements are unaudited but have been reviewed by
KPMG Audit Plc.

The interim financial statements have been prepared in accordance with the
recognition and measurement criteria of IFRS's and comply with the requirements
of the Listing Rules issued by the Financial Services Authority.

The interim financial statements have been prepared on a basis consistent with
the accounting policies adopted for the year ended 31 December 2006. These
policies are set out in the Group's Annual Report and Accounts 2006.

As the Group's main operation is that of a housebuilder and it operates entirely
within the United Kingdom, there are no separate segments, either business or
geographic, to disclose.

The Group has adopted IFRS 7 on 1 January 2007, which clarifies disclosure
requirements for financial instruments. Adoption of IFRS 7 has had no impact on
the income statement or balance sheet of the Group.

The interim financial statements do not constitute statutory accounts within the
meaning of Section 240 of the Companies Act 1985. The figures for the half years
ended 30 June 2007 and 30 June 2006 are unaudited. The figures for the year
ended 31 December 2006 have been derived from the Company's statutory accounts
for the year ended 31 December 2006 upon which the auditors issued an
unqualified opinion and which have been delivered to the Registrar of Companies.

2 Earnings per share

Basic earnings per ordinary share for the six months ended 30 June 2007 is
calculated on profit after tax of £41,048,000 (six months ended 30 June 2006:
£39,697,000; year ended 31 December 2006: £95,038,000) over the weighted average
of 119,880,594 (six months ended 30 June 2006: 118,792,999; year ended 31
December 2006: 119,103,010) ordinary shares in issue during the period.

Analysis of effect of one-off pension credit on basic earnings per share

                          Six months       Six months           
                               ended            ended           Year ended
                        30 June 2007     30 June 2006          31 Dec 2006
                          (unaudited)      (unaudited)            (audited)
--------------------------------------------------------------------------------

Basic earnings per share        34.2p            33.4p                79.8p
Effect of one off IAS
19 pension credit,
net of related tax                 -             (2.0p)               (2.0p)
--------------------------------------------------------------------------------
Earnings per share
stated before pension
credit, net of
related tax                     34.2p            31.4p                77.8p
--------------------------------------------------------------------------------

Diluted earnings per ordinary share is calculated on profit after tax of
£41,048,000 (six months ended 30 June 2006: £39,697,000; year ended 31 December
2006: £95,038,000) over the diluted weighted average of 120,229,838 (six months
ended 30 June 2006: 119,232,829; year ended 31 December 2006: 119,523,151)
ordinary shares potentially in issue during the period. The average number of
shares is diluted in reference to the average number of potential ordinary
shares held under option during the period. This 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
exercise price. The market value of shares has been calculated using the average
ordinary share price during the period. Only share options which have met their
cumulative performance criteria have been included in the dilution calculation.

At the 2006 half year, the profit after tax used in the diluted earnings per
share calculation included a £9,000 adjustment to reverse the charge within the
income statement in respect of the fair value of share options in issue. This
adjustment was subsequently deemed unnecessary at the full year 2006 and has
been excluded from the 2006 half year calculations included in this report. The
impact of restatement is immaterial.

Analysis of effect of one off pension credit on diluted earnings per share

                          Six months       Six months           
                               ended            ended           Year ended
                        30 June 2007     30 June 2006          31 Dec 2006
                          (unaudited)      (unaudited)            (audited)
--------------------------------------------------------------------------------

Diluted earnings per share      34.1p            33.3p                79.5p
Effect of one off IAS
19 pension credit,
net of related tax                 -             (2.1p)               (2.0p)
--------------------------------------------------------------------------------
Diluted earnings per
share stated before
pension credit, net
of related tax                  34.1p            31.2p                77.5p
--------------------------------------------------------------------------------


3 Dividends

The following dividends per qualifying ordinary share were paid by the Group.

                                Six months         Six months      
                                     ended              ended      Year ended
                              30 June 2007       30 June 2006     31 Dec 2006
                                (unaudited)        (unaudited)       (audited)
--------------------------------------------------------------------------------

May 2007: 20.0p (May 2006:
16.7p)                              23,976             19,826          19,826
November 2006: 10.0p                     -                  -          11,931
--------------------------------------------------------------------------------
                                    23,976             19,826          31,757
--------------------------------------------------------------------------------

An interim dividend in respect of 2007 of 17.5p per share, amounting to a total
dividend of £21,010,000 based on the shares in issue as at 7 September 2007, was
declared by the Board on 7 September 2007. This interim dividend will be paid on
23 November 2007 to shareholders on the register at the close of business on 28
September 2007. This dividend has not been recognised as a liability at the
balance sheet date.

4 Income taxes

Current tax

Current tax expense for the interim periods presented is the expected tax
payable on the taxable income for the period, calculated using a corporation tax
rate of 30%, adjusted to take account of deferred taxation movements.

Current tax for current and prior periods is classified as a current liability
to the extent that it is unpaid. Amounts paid in excess of amounts owed are
classified as a current asset.

Deferred tax

The amount of deferred tax provided is based on the expected manner of
realisation or settlement of the carrying amount of assets and liabilities using
tax rates enacted or substantially enacted at the balance sheet date.

5 Reconciliation of net cash flow to net cash/(debt)

                            Six months          Six months       
                                 ended               ended        Year ended
                          30 June 2007        30 June 2006       31 Dec 2006
                            (unaudited)         (unaudited)         (audited)
                                  £000                £000              £000
--------------------------------------------------------------------------------

Net (decrease)/increase
in cash and cash
equivalents                    (10,012)             15,839           148,864
Repayment of borrowings         15,000              15,000            15,000
Fair value adjustments 
to interest rate swaps             165                 385               642
Net cash/(debt) at
start of period                102,681             (61,825)          (61,825)
--------------------------------------------------------------------------------
Net cash/(debt) at
end of period                  107,834             (30,601)          102,681
--------------------------------------------------------------------------------

Analysis of net cash/
(debt):
Cash                           132,829               9,816           142,841
Bank overdraft                       -                   -                 -
Bank loans                     (25,000)            (40,000)          (40,000)
Fair value of interest 
rate swaps                           5                (417)             (160)
--------------------------------------------------------------------------------
Net cash/(debt)                107,834             (30,601)          102,681
--------------------------------------------------------------------------------

6 Group statement of changes in equity

                       Total       Issued      Share    Hedge           Total
                    retained      capital    premium  reserve
                    earnings
--------------------------------------------------------------------------------
                        £000         £000       £000     £000            £000
--------------------------------------------------------------------------------
Balance as 1
January 2006         392,160       59,699    146,849     (561)        598,147
Total recognised
income and expense    43,890            -          -      269          44,159
Issue of share           
capital                    -          328      4,269        -           4,597
Share based 
payments                 (29)           -          -        -             (29)
Dividends paid to
shareholders         (19,826)           -          -        -         (19,826)
--------------------------------------------------------------------------------
Balance at 30
June 2006            416,195       60,027    151,118     (292)        627,048
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
Balance at 1
January 2006         392,160       59,699    146,849     (561)        598,147
Total recognised
income and expense   101,304            -          -      449         101,753
Issue of share           
capital                    -          589      8,645        -           9,234
Share based            
payments                 455            -          -        -             455
Dividends paid to
shareholders         (31,757)           -          -        -         (31,757)
--------------------------------------------------------------------------------
Balance at 31
December 2006        462,162       60,288    155,494     (112)        677,832
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
Balance at 1
January 2007         462,162       60,288    155,494     (112)        677,832
Total recognised
income and expense    44,461            -          -      116          44,577
Issue of share       
capital                    -           88        796        -             884
Own shares sold            -            -          -        -               -
Share based           
payments                 474            -          -        -             474
Dividends paid to
shareholders         (23,976)           -          -        -         (23,976)
--------------------------------------------------------------------------------
Balance at 30
June 2007            483,121       60,376    156,290        4         699,791
--------------------------------------------------------------------------------

7 Circulation to shareholders

The interim report will be sent to shareholders. Further copies will be
available on request from the Company Secretary, Bovis Homes Group PLC, The
Manor House, North Ash Road, New Ash Green, Longfield, Kent DA3 8HQ.

Further information on Bovis Homes Group PLC can be found on the Group's
corporate website www.bovishomes.co.uk/plc including the analyst presentation
document which will be presented at the Group's results meeting on 10 September
2007.

Independent review report by KPMG Audit Plc to Bovis Homes Group PLC

Introduction

We have been instructed by the Company to review the financial information for
the six months ended 30 June 2007 which comprises the Group income statement,
Group balance sheet, Group statement of cash flows, Group statement of
recognised income and expense and notes to the accounts. We have read the other
information contained in the interim report and considered whether it contains
any apparent misstatements or material inconsistencies with the financial
information. This report is made solely to the Company in accordance with the
terms of our engagement to assist the Company in meeting the requirements of the
Listing Rules of the Financial Services Authority. Our review has been
undertaken so that we might state to the Company those matters we are required
to state to it in this report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than
the Company for our review work, for this report, or for the conclusions we have
reached.

Directors' responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are responsible for preparing the interim report in accordance with the Listing
Rules of the Financial Services Authority which require that the accounting
policies and presentation applied to the interim figures should be consistent
with those applied in preparing the preceding annual accounts except where any
changes, and the reasons for them, are disclosed.

Review work performed

We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the UK. A review consists
principally of making enquiries of management and applying analytical procedures
to the financial information and underlying financial data and, based thereon,
assessing whether the accounting policies and presentation have been
consistently applied unless otherwise disclosed. A review excludes audit
procedures such as tests of controls and verification of assets, liabilities and
transactions. It is substantially less in scope than an audit performed in
accordance with International Statements on Auditing (UK and Ireland) and
therefore provides a lower level of assurance than an audit. Accordingly, we do
not express an audit opinion on the financial information.

Review conclusion

On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 June 2007.

KPMG Audit Plc
Chartered Accountants
London

7 September 2007



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