Preliminary Results 2005

Bovis Homes Group PLC
13 March 2006



                             BOVIS HOMES GROUP PLC

            PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005

                              Issued 13 March 2006

The Board of Bovis Homes Group PLC today announced its preliminary results for
2005 which have been prepared in accordance with International Financial
Reporting Standards as adopted by the EU ('IFRS').

   • Pre tax profit of £116.1 million (2004: £144.8 million)

   • Earnings per share of 69.0p (2004: 86.8p)

   • Final dividend increased to 16.7p net per ordinary share making 25.0p
     for the year, a 25% increase over the prior year
 
   • Year end net borrowings of £61.8 million (10% geared)

   • Operating margin at 24.0% (2004: 27.1%)

   • Plots with planning consent increased by 1,610 plots to 13,138 plots
    (4.9 years land supply) (owned: 12,696 plots/ controlled: 442 plots)

   • Strategic landholdings at 22,116 potential plots (circa 8 years
    potential land supply) after gaining planning consent on 2,384 plots during
    2005

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

'Bovis Homes has succeeded in adding considerable shareholder value despite the
commercial challenges which arose in 2005. The Group generated healthy profits
and retained a strong operating margin which underpins the high quality nature
of the Group's profits. During 2005, the Group was able to grow its consented
land bank to 13,138 plots, adding 2,384 plots from the successful conversion of
strategic land at a substantial discount to market value.

Responding to the changing marketplace, the Group has evolved its product
offering to provide a greater number of smaller, more affordable, private homes
which target a wide cross-section of home purchasers. The Group entered 2006
with a stronger order book than in previous years. Reservation levels to date
this year have been encouraging and at 10 March 2006, the Group had secured 
1,368 reservations for legal completion in 2006.

The Group's strategy of long term investment in strategic land is fundamental to
its growth and profitability. The Group is well on course to deliver its
predicted 9,000 plots from strategic land between 2004 and 2006. Having gained
planning consent on 4,539 strategic plots in 2004 and 2005, on 8 March 2006, the
Group secured a resolution to grant planning consent, subject to signing the
necessary legal documents, for the first phase of the site controlled by the
Group at Wellingborough. This consent, when released, will provide the Group the
ability to construct over 3,000 homes together with substantial commercial
development.

The Group is well positioned to expand and deliver value for its shareholders.
The Board remains content with its previous statement in respect of dividends.
As previously declared, subject to a stable business environment, the full year
dividend will be doubled to 40 pence per share over the four year period to
2008.'


Enquiries:  Malcolm Harris,       Results issued by: Andrew Best / Emily Bruning
            Chief Executive                          Shared Value Limited
            David Ritchie,                           On Monday 13 March -
            Finance Director                         tel: [phone]
            Bovis Homes Group PLC                  
            On Monday 13 March - 
            tel: [phone]
            Thereafter - tel: [phone]


Chairman's statement

During 2005, Bovis Homes has demonstrated that it is able to produce healthy
profits in a more challenging housing market. The Group has been able to
generate a strong operating margin which underpins the high quality nature of
the Group's profits and has maintained low debt levels closing the year with
only 10% gearing. The Group is well positioned to expand in the current
competitive environment.

Results

Profit on ordinary activities before tax for the year ended 31 December 2005 was
£116.1 million, compared with £144.8 million in 2004. This result was achieved
from total revenue of £521.2 million compared with £559.5 million in 2004. Basic
earnings per share was 69.0 pence per ordinary share compared to 86.8 pence per
ordinary share in 2004.

In 2005, the Group focused on delivering smaller, more affordable, properties
which had the effect of reducing the average sales price achieved. Consequently,
the absolute profit achieved per home legally completed reduced. Importantly,
whilst appropriately adapting its market position, the Group retained its
ability to generate strong trading profit margins on the homes that it legally
completed in 2005. The operating margin remained strong at 24.0% compared with
27.1% in 2004.

In a year when there was significant investment in working capital, the Group
achieved a good return on average capital employed of 20%.

Dividend

The Board proposes a final dividend for the year ended 31 December 2005 of 16.7
pence, to be paid on 26 May 2006 to shareholders on the register at the close of
business on 31 March 2006. This dividend, when added to the interim dividend of
8.3 pence paid on 25 November 2005, totals 25.0 pence for the year and is
covered 2.8 times by the basic earnings per share of 69.0 pence. The total
dividend per share for the year represents an increase of 25% over the total
dividend for 2004 of 20.0 pence.

The Board remains content with its previous statement in respect of dividends.
It intends, conditional on any necessary approvals required at future general
meetings, to increase the full year dividend for 2006 to 30.0 pence net per
share followed by 5.0 pence per share increases in 2007 and 2008. This
commitment, which remains, as previously declared, subject to a stable business
environment, will double the full year dividend to 40.0 pence net per share from
its 2004 base of 20.0 pence.

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 2005 final
dividend.

Market conditions

The 2005 calendar year represented the most competitive and challenging period
the housing market has seen for many years. Activity in the housing market
depends, to a great extent, on consumer confidence. Whilst affordability
continued to be good throughout 2005, consumers demonstrated caution in making
significant purchasing decisions. Housing represents one of the largest
purchasing decisions an individual makes. Without the confidence generated by
job security and greater stability of mortgage repayments, many consumers
deferred their purchase decisions during 2005. This was demonstrated through the
level of property transactions in England and Wales during 2005, which was 11%
lower than in 2004.


The Bank of England Monetary Policy Committee has held the base interest rate
steady at 4.5% since it reduced the rate by 25 basis points in August 2005. This
base rate, along with a consistently competitive mortgage market, has maintained
good affordability. Whilst consumers will continue to observe base interest
rates carefully and can be expected to react to future changes, the current
affordable level of interest rate alongside improving confidence should assist a
recovery in property transaction levels.

During 2005, the rate of earnings growth was 3.8%, which was closer to the
annual increase in house prices than it has been for many years. According to
the Halifax, house prices in the United Kingdom increased by 5.1% during 2005
whilst the Office of the Deputy Prime Minister reported that house prices in the
United Kingdom increased in 2005 by 2.2%. At these rates of house price growth,
house owners' ability to meet mortgage repayments has been maintained.

Strategy

The Group continues to adapt its strategy as market conditions change. The Group
has exploited its strategy of procuring a cost effective supply of land through
long term investment followed by a design, construction and marketing process
which has achieved a high level of return from each home constructed and legally
completed. This has been a successful strategy in a rising housing market,
generating strong sales prices and high trading profit margins. The Group
recognises, however, that its historical strategy elongated the period of
financial return from the point of investment, with a slower sales rate
necessary to achieve the Group's higher levels of profit per home.

The Group has evolved its product offering away from detached housing,
historically the most significant category of housing constructed by the Group,
towards smaller, more affordable, private homes which appeal to a larger
cross-section of house purchaser, including first time buyers. These homes sell
more easily in a challenging housing market. Importantly, this has not involved
the Group increasing significantly the number of apartments within its overall
mix. The number of social and partnership homes legally completed was also
increased during 2005, based on pre-agreed sales to housing associations. Houses
are released for sale at an earlier stage of the build cycle to facilitate early
reservations. Design and build phases of the process are being accelerated
through the use of efficient house designs and enhanced labour supply to the
sites.

These changes will assist the Group to expand the volume of its legal
completions going forward while still exploiting the benefit of a cost-effective
land supply through long term investment. The approach to land investment
remains unchanged. The Group continues to aspire to replace all of the land used
in any one financial period with land procured through strategic means. This
will maintain a land asset with a cost base below market value which provides
for strong trading profit margins on the homes constructed and sold on this
land.

The Group is committed to implementing this evolving strategy over a wider
regional structure. Land investment in targeted locations, often of a strategic
type, will provide the nucleus for new regions. An increased number of fully
operational regions is intended to contribute to a growth in volume of legal
completions.

In a housing market where sales price increases may be difficult to achieve, the
Group's strategy to accelerate the delivery of homes on site and grow the size
of its business through increased coverage of England and Wales is considered
the optimum way forward. This strategy does not involve significant dilution of
financial returns and will allow the Group to increase revenue, whilst retaining
a strong margin.


The Board

Following the retirement from the Board on 9 September 2005 of Sir Nigel Mobbs,
non-executive Chairman, I was honoured to be appointed as Nigel's successor. I
undertook the role of acting non-executive Chairman from 9 September until the
date of my appointment as non-executive Chairman on 14 November 2005. The Board
recognises the enormous contribution which Nigel made to the development of the
Group before and since its flotation in 1997. The Board's deepest condolences
were extended to Nigel's family following his untimely death on 21 October 2005.

The Board is pleased to announce the appointment of a new non-executive
director, Mr John Warren, who joined the Board on 1 March 2006. Mr Warren is a
qualified chartered accountant and has considerable financial experience, having
served as Group Finance Director for WH Smith PLC between 2000 and 2005, and
Group Finance Director for United Biscuits plc between 1991 and 2000. He is also
a non-executive director of Rank Group plc, Arla Foods UK plc and Spectris plc.
The Board now comprises four non-executive directors, including myself as
Chairman, and two executive directors.

Employees

Bovis Homes is a people business and I would like to thank all our employees for
their contribution during a challenging year. It is essential that the right
individuals are recruited, trained and motivated. The objective is to ensure
that the Group employs the highest calibre of employees, who add value to the
business. Our employees are encouraged to be sensitive to the demands and
requirements of the Group's customers, whilst demonstrating the entrepreneurial
drive and flair to move the operation forward without compromising sound
corporate governance.

Prospects

After a year when house prices increased at a rate similar to earnings growth,
affordability for house purchasers remains good. It is likely that house prices
in 2006 will increase modestly, at a rate likely to be lower than earnings
growth. This will sustain affordability, assuming that interest rates remain
reasonably stable.

The fundamentals of the housing market remain strong with demand in the areas in
which the Group operates exceeding supply. The rate of new homes construction in
the United Kingdom during 2005 was 7.5% lower than in 2004 based on private
housing registrations recorded by the National House Building Council. It is
generally accepted that the development of new housing is not keeping pace with
the generation of new households and that the housing shortage is worsening. On
this basis, the marketplace in which the Group operates should be capable of
supporting increased numbers of property transactions, as well as sustaining
house prices. To ensure the Group is well placed to exploit this marketplace,
the houses offered for sale during 2006 will include an increased number of
small affordable private homes.

The Group started 2006 with a strong land bank of 13,138 consented plots, with a
low average plot carrying value relative to the market value of these plots.
Considerable shareholder value has been generated from the Group's consistent
policy of long term investment, both in respect of land purchased with
residential planning consent and land controlled without such consent. The
consented land bank, which approximates to five years of land supply when
measured against 2005's volume of legal completions, represents a low cost,
ready supply of asset on which to develop new homes and with which the Group
should be able to maintain a strong operating margin in the future.


The Group has a further eight years of potential land supply within its
strategic land bank. The Group is well on course to delivering its predicted
9,000 plots of consented land from the strategic land bank between 2004 and
2006, having gained residential planning consent on approximately 4,500
strategic plots during 2004 and 2005. The value generated from strategic land
sites gaining residential planning consent can be considerable and this value,
which is not reflected in the Group's net assets, will contribute strongly to
profits in future years as these strategic sites gain residential planning
consent and development proceeds.

In summary, the Group started 2006 with five years supply of good value
consented residential land and a further eight years potential supply of
strategic land. The range of homes currently being built on the Group's sites is
ideal for targeting a wide cross-section of home buyers. This should enable the
Group to increase its volume of legal completions in the prevailing competitive
marketplace. Profit margins are underpinned by the high quality, low cost land
controlled by the Group. As land is utilised through the development of homes,
replacement land will become available at a discount to market value from the
Group's strategic landholdings. The Group is well positioned to expand and to
deliver further value for its shareholders.

Tim Melville-Ross

Chairman


Chief Executive's operational review

Results

Considerable shareholder value was created in 2005 through the successful
conversion of strategic landholdings. During the year, 2,384 plots were
transferred from strategic land to the Group's consented landholdings at a
substantial discount to market value.

The Group's new range of homes, which target a wide cross-section of home
purchasers, has been well received, culminating in the number of private, one
and two bedroom properties legally completed in the year, increasing to 602
homes (23% of volume) compared with 418 homes (15% of volume) in 2004. The
decision to expand the Group's partnership and social housing business has also
been timely, resulting in 596 legal completions (22% of volume) in 2005 compared
with 303 legal completions (11% of volume) in 2004.

Profit before tax was £116.1 million, reflecting the challenging market
conditions. The Group's operating margin was strong at 24.0%, particularly
taking into account the increase in social and partnership housing. Despite the
significant investment in consented landholdings, gearing remained low at 10%.

Trading environment

The first six months of 2005 witnessed consumer caution following increases in
interest rates during 2004, accompanied by concerns as to the robustness of
house prices and fears that interest rates could increase further. One, two and
three bedroom homes continued to sell steadily. The detached housing market and
retirement homes segment, however, was subdued largely due to difficulties in
securing the sale of dependent properties.

The housing market remained slow until the last quarter of the year. Following
the reduction in base rate in August, the market responded with an improvement
in confidence which resulted in an increase in activity. The overall level of
property transactions in England and Wales was 11% lower in 2005 than the
preceding year. Housing affordability was maintained during the year with
earnings increasing in line with the combined effects of movement in interest
rates and house prices.

Product mix and average sales price

The Group legally completed 2,702 homes, including 147 homes constructed on
third party owned land, compared to 2,700 homes in 2004, including 127 homes on
third party owned land.

Market sector analysis

Year ended 31 December                           
                                    2005                        2004
                               %   Units      Average      %   Units      Average
House type                                sales price                 sales price
                                                    £                           £
----------------------------------------------------------------------------------

One and two bedroom           23     602      135,100     15     418      136,800
Three bedroom                 31     845      183,900     37     989      184,900
Four bedroom                  12     321      266,500     17     468      245,300
Five or more bedroom           9     254      313,600     15     397      313,400
Retirement Living              3      84      239,100      5     125      243,400
Social housing                17     449       94,300      6     176       91,500
Partnership housing (third
party owned land units)        5     147       74,100      5     127       67,200
----------------------------------------------------------------------------------
Group                        100   2,702      175,500    100   2,700      197,900
----------------------------------------------------------------------------------


The Group's average sales price was £175,500 compared with £197,900 in the
previous year, an 11.3% decrease. The average size of unit decreased by 11.5% to
1,014 square feet (2004: 1,146 square feet), therefore, the average sales price
per square foot increased by 0.2%. Excluding social and partnership housing, the
average sales price per square foot for private units increased by 2.7%.


Product mix analysis

Year ended 31 December              2005                         2004
                               %   Units      Average     %     Units      Average
House type                                sales price                  sales price
                                                    £                            £
-----------------------------------------------------------------------------------

Traditional                   28     758      194,200      31     858      185,900
Room in the roof              13     354      295,000      19     512      292,300
Three storey                  21     558      202,200      25     663      206,000
Apartments                    13     352      135,500       9     239      140,700
Retirement Living              3      84      239,100       5     125      243,400
Social housing                17     449       94,300       6     176       91,500
Partnership housing (third
party owned land units)        5     147       74,100       5     127       67,200
-----------------------------------------------------------------------------------
Group                        100   2,702      175,500     100   2,700      197,900
-----------------------------------------------------------------------------------


Regional performance

Unit completions and average sales price

Year ended 31 December             2005                      2004
                                  Units         Average     Units      Average
                                            sales price            sales price
                                                      £                      £
--------------------------------------------------------------------------------

South East                          986         187,100       873      204,700
South West                          678         149,700       809      171,100
Central                             500         179,000       531      213,900
Eastern                             222         173,900       178      202,500
Northern                            232         173,700       184      202,300
Retirement Living                    84         239,100       125      243,400
--------------------------------------------------------------------------------
Group                             2,702         175,500     2,700      197,900
--------------------------------------------------------------------------------


The average sales price achieved by the Group was significantly influenced by
the change in product mix of homes legally completed with 23% of legal
completions (2004: 15%) being one and two bedroom homes. The contribution to the
product mix from social and partnership housing increased from a combined 11% in
2004 to a combined 22% in 2005. Within individual regions the impact of these
product mix changes varied, however, each region was impacted to a degree. The
increased contribution from social housing was particularly notable in the South
East, South West and Central regions.

There was positive growth in the number of legal completions in both Eastern and
Northern. The decrease in average size of private unit and the increase in both
regions of social housing, reduced the average sales price achieved.


The Retirement Living region was significantly impacted during 2005 by the
slower second hand housing market. Detached properties were more difficult to
sell and as many of Retirement Living's customers trade down from expensive
detached properties, the ability to convert reservations into legal completions
was a greater challenge.

Operating margins

Year ended 31 December                                     2005           2004
                                                              %              %
--------------------------------------------------------------------------------

South East                                                 30.1           28.9
South West                                                 20.1           23.5
Central                                                    19.5           29.3
Eastern                                                    24.1           31.5
Northern                                                   18.8           18.8
Retirement Living                                          24.1           35.0
--------------------------------------------------------------------------------
Group                                                      24.0           27.1
--------------------------------------------------------------------------------


Regional operating margins were influenced in 2005 by the level of contribution
from homes constructed on strategically sourced land, the increased number of
social and partnership housing in the mix, and the ability of a region to
sustain the volume of legal completions, thus maintaining the efficiency of
recovery of overheads.

The South East region maintained its gross margin during 2005 with 48% of its
profits generated from strategically sourced land (2004: 35%) and was able to
improve its operating margin through more efficient overhead absorption. In the
South West region, the mix of properties adversely affected the operating margin
with a higher percentage of social and partnership properties at 28% compared
with the prior year's 22%. In Central region, the increase in social housing
from 10% of volume in 2004 to 28% of volume in 2005 had a significant effect on
the margin generated. In addition, the reduction in percentage of profit
generated from units sourced from strategic land from 34% in 2004 to 23% in 2005
also affected the operating margin. The expansion of the Eastern region was
facilitated during 2005 by legal completions on new land acquisitions which
generated good profit margins. The comparison with 2004's operating margin was
adverse due to legal completions in that year arising to a greater degree from
historical land owned by the Group within the Eastern region's geographic
boundaries when the region was established. In respect of Retirement Living, the
reduction in volume year on year reduced the efficiency of overhead absorption.


Land and planning

Consented land bank

Total plots as at 31 December                                   2005      2004
                                                               Plots     Plots
--------------------------------------------------------------------------------

South East                                                     3,404     3,531
South West                                                     3,341     2,464
Central                                                        2,260     2,210
Eastern                                                        2,057     1,135
Northern                                                       1,383     1,526
Retirement Living                                                251       308
--------------------------------------------------------------------------------
Group (exc. third party owned land plots)                     12,696    11,174


Third party owned land plots
South East                                                        88         -
South West                                                       354       354
--------------------------------------------------------------------------------
Group                                                         13,138    11,528
--------------------------------------------------------------------------------

Years' supply based upon legal completions in the year           4.9       4.3
--------------------------------------------------------------------------------


The average plot cost of the consented land bank (excluding social housing and
third party owned land) was £45,300 which represented 22.7% of the average sales
price achieved in 2005 (excluding social housing and units constructed on third
party owned land). This compared with the average plot cost at the start of 2005
of £45,600, the reduction being contributed to by the successful conversion of
strategic land into consented land during 2005. In particular, the achievement
of planning consent at Brockworth Airfield in Gloucestershire increased the
consented landholdings by 1,300 plots at an average plot cost of £25,600.

Strategic land bank

Total potential plots as at 31 December                          2005       2004
                                                                Plots      Plots
--------------------------------------------------------------------------------

South East                                                      8,207      9,095
South West                                                      5,124      5,938
Central                                                         7,099      6,349
Eastern                                                           336        434
Northern                                                        1,180        872
Retirement Living                                                 220        143
--------------------------------------------------------------------------------
Group                                                          22,166     22,831
--------------------------------------------------------------------------------

Years' supply based upon completions in the year                  8.2        8.5
--------------------------------------------------------------------------------



Strategic landholdings at 31 December 2005 were 22,166 potential plots after
transferring 2,384 plots to the consented land bank during the year at a
substantial discount to market value. Planning consent has been gained on 4,539
strategic land plots during 2004 and 2005 and the Group anticipates attaining
residential planning consent during 2006 on a number of significant landholdings
to achieve the objective of delivering 9,000 strategic plots with a residential
planning consent over the three year period 2004 to 2006. In particular, a
resolution to grant planning consent, subject to signing the necessary legal
documents, was approved on 8 March 2006 for the first phase of the site
controlled by the Group at Wellingborough. This consent when released will
provide the ability for the Group to construct over 3,000 homes plus substantial
commercial development.

The consistent and continuing investment in this important part of the Group's
business will provide a solid base from which to provide the shareholders with
high levels of profitability and dividend growth. Legal completions generated on
plots sourced through strategic land contributed 32% (2004: 29%) of the Group's
development profit in the year.

Partnership housing

The Group is actively involved with housing associations, local authorities and
other similar bodies providing quality new homes at affordable prices, either
for rent or shared ownership, to communities throughout the country. The Group
has total in-house capability to handle all aspects of each project, including
major regeneration schemes. In addition to design and build, there exists
expertise to provide cross subsidies from the development and sale of open
market housing and commercial buildings.

The Horfield regeneration project in Bristol remains the largest partnership
scheme currently being developed by the Group and is now expected to deliver
over 900 properties when completed. The Group has been confirmed as preferred
development partner on a number of new regeneration projects which may generate
opportunities to develop over 2,000 dwellings. This part of the Group's business
is programmed to grow over the coming years, and provides a further opportunity
to work in partnership with local authorities, Government and registered social
landlords.

Research and development

The Group believes that continuous improvement through research and development
is key to the continuing success of the business and is a significant factor in
delivering environmental, social and sustainability objectives. The Group
engages with many stakeholder organisations, including housebuilding industry
warranty providers and building control bodies, the House Builders Federation,
the Building Research Establishment, the ODPM in respect of building regulation
development, and actively partners many manufacturers and suppliers. Further
details are contained in the Group's Corporate Social Responsibility report
which is available to all shareholders.

Health, safety and environment

Best practice in health, safety and environmental awareness and management is an
important element in the continuing success of the Group. The objective is to
maintain the highest practical levels of health and safety and effective
environmental policies.


The Health, Safety and Environmental Consultative Committee oversees these
important matters, formulating and promulgating policy to all stakeholders. The
Committee is chaired by a Bovis Homes Limited director by annual rotation to
ensure that fresh ideas and initiatives are constantly introduced, assessed and,
where appropriate, implemented on a consistent basis. The chairman is supported
by a committee comprising Group employees from numerous disciplines complemented
by the Health and Safety Director and external independent professional
advisers. The chairman reports formally to the Board through submission of a
Health and Safety report tabled at each Board meeting.

Bovis Homes promotes all aspects of safety and environmental management
throughout its operations in the interests of all stakeholders. Its record of
success was once again recognised in 2005 with the Gold Medal Award from the
Royal Society for the Prevention of Accidents and the National Award from the
British Safety Council. Further details are available in the Group's Corporate
Social Responsibility report.

Bovis Homes' objective is to achieve sustainable construction and reduce
environmental impact. The Group seeks to protect and, wherever possible, improve
the environment by retaining mature landscaping and introducing new planting and
habitats.

It is also committed to planning for the most efficient and effective use of
development land. The Group has introduced higher density properties with
flexible accommodation which addresses the changing lifestyles of its customers,
including the ability to work from home.

The Group has issued to employees within the Group an Environmental Management
Manual containing the Environmental Policy, Environmental Effects Document and
Best Practice Checklists. It is a comprehensive approach consolidating policies,
procedures and systems, explaining how all employees can assist and make a
positive contribution to the environment.

Legislation and taxation

The planning system continues to be burdened by further legislation and
bureaucracy. Delays in the processing of applications is now the norm rather
than the exception. Staff shortages within many local authorities coupled with
ever-changing requirements from Government burden the industry. The possible
introduction of Home Information Packs, if implemented as currently proposed, is
likely to adversely affect the volume of transactions and will increase the cost
of selling a property, with no obvious corresponding value benefit to the buyer.

The possible introduction of a planning gain supplement in 2008 is likely to
further reduce land supply and add additional complexity and delay to the
processing of land purchases. Aggregate tax, landfill tax, climate change levy
and stamp duty add to the cost of providing homes in the UK.

Pension scheme

The Group made a commitment during 2004 to fund the past service deficit on its
defined benefits pension scheme, as identified in the actuarial valuation
completed in June 2004, by 2007. Up to 31 December 2005, special contributions
had been paid into the pension scheme amounting to £3.6 million.

Group structure

The new Wessex and South Midlands operations were established on 1 July 2005 and
are operating as sub-regions of existing fully operational regions until fully
established as separate businesses.


Outlook for 2006

The current economic outlook suggests market stability. Earnings are expected to
increase above the change in retail prices, which will increase levels of
disposable income and therefore assist affordability within the housing market.
Oil and other energy supplies and their pricing remain a concern. However, the
effect of increases during 2005 has, to date, been surprisingly moderate.


Significant changes have been made during 2005 to the Group's product mix,
procedures and resources to enable legal completion volumes to be increased
during 2006 and beyond. The early release of properties for sale has resulted in
an improved forward order book. Group landholdings, both consented and
strategic, are strong.


The business is well positioned to expand and deliver sustainable shareholder
value.


Malcolm Harris
Chief Executive


Financial review

Overview

The 2005 financial year for Bovis Homes was notable on two fronts. Firstly, the
Group enjoyed considerable success in gaining planning consent on a significant
number of strategic land plots and converting these plots into the Group's
consented land bank at a healthy discount to market value. Secondly, the Group
endured the frustration of its attempts to expand activity levels in a housing
market in which transaction levels were reducing. The enhanced land bank now
controlled by the Group provides opportunity to generate significant shareholder
value in the future.

Throughout 2005, the consumer displayed caution in purchase decisions.
Uncertainty over the direction of interest rates and ongoing media speculation
over whether house prices would fall contributed to reduced levels of property
transactions in England and Wales.

The Group succeeded in maintaining its volume of legal completions during 2005
with 2,702 homes compared to 2,700 homes in 2004. In 2005, the Group witnessed
the major effect from the deliberate realignment of its product offering towards
smaller, more affordable, private homes. This change in mix was important in
assisting the Group to be able to offer homes to a wider spectrum of the housing
market encompassing first time buyers as well as mature homeowners. Whilst the
change in mix provides an opportunity to grow volumes it clearly has an adverse
effect on average sales price and hence the absolute average profit generated
per unit.

The Group's land bank increased by 14% to 13,138 controlled plots with
residential planning consent. Whilst this represented significant investment in
working capital, the Group continued to operate with low levels of gearing,
which closed 2005 at 10% and averaged 16% during the year.

2005 was an eventful year in respect of accounting rules. The Group's results
have been prepared for the first time under the requirements of International
Financial Reporting Standards as adopted by the EU ('IFRS'). Compared to the
results which would have been prepared under the previous UK GAAP, the IFRS
reported pre tax profits were £0.4 million lower and the Group's IFRS net assets
were reduced by £6.0 million.

Profit before tax and earnings per share

The profit on ordinary activities before tax for the year ended 31 December 2005
amounted to £116.1 million. This compared with £144.8 million in the previous
year. Basic earnings per share was 69.0 pence compared with 86.8 pence in 2004.

Revenue

Total revenue achieved was £521.2 million (2004: £559.5 million). Included
within this figure was housing revenue of £474.2 million (2004: £534.4 million).
As mentioned above, legal completions were broadly in line with the prior year
at 2,702 units, hence the decrease in housing revenue was primarily due to an
11.3% decrease in average sales price to £175,500 compared with £197,900 in
2004. The average sales price per square foot increased by 0.2% whilst the
average size of unit decreased by 11.5% to an average 1,014 square feet (2004:
1,146 square feet).

Land sales amounted to £34.2 million compared with £19.6 million in 2004 whilst
other income, mainly arising from sales of commercial interests, was £12.8
million compared with £5.5 million in 2004.


Operating profit

The Group achieved an operating profit of £125.1 million, compared with £151.5
million in the previous year, and generated an operating margin of 24.0%.

Analysis of margin  

                                        Private housing                 Group
                                      2005          2004          2005          2004
                                         %             %             %             %
--------------------------------------------------------------------------------------
Revenue                             100.0         100.0         100.0         100.0
Land costs                          (19.1)        (19.8)        (19.2)        (19.6)
Construction costs                  (48.0)        (45.2)        (48.3)        (45.2)
--------------------------------------------------------------------------------------
Gross profit                         32.9          35.0          32.5          35.2
Administrative expenses (inc.
sales and marketing costs)           (8.5)         (8.2)         (8.5)         (8.1)
--------------------------------------------------------------------------------------
Operating profit                     24.4          26.8          24.0          27.1
--------------------------------------------------------------------------------------


The Group indicated during 2005 that cost pressures in excess of sales price
improvements would reduce the trading profit margins available from selling
homes. This manifested itself mainly through increased construction costs rather
than increased land costs. The average land cost per private legal completion
was £38,200 compared with £42,200 in 2004, representing 19.1% of private housing
revenue compared with 19.8% in 2004. Construction costs per legal completion
were £86,100 compared with £90,300 in 2004, a reduction of 4.7% per unit.
Construction costs represented 48.3% of Group revenue compared with 45.2% in
2004. In addition to inflationary cost pressures prevailing in the marketplace,
this increase in construction costs as a share of revenue reflected the more
significant contribution to legal completions from apartments and smaller houses
which typically have higher construction costs per square foot due to the higher
proportion of non variable costs within the cost base.

Land sale profits less option costs generated a net profit of £13.1 million in
2005 (2004: £9.4 million). Administrative expenses, which include all sales and
marketing costs, as a percentage of revenue were 8.5% compared with 8.1% in
2004. Administrative expenses decreased by 3.3% to £44.1 million compared with
£45.6 million in the previous year.

Financing

Net interest payable amounted to £9.0 million (2004: £6.7 million), and was
covered 14 times by profit before interest. The Group's average borrowings
during 2005 were £88.1 million which generated a bank interest charge, including
arrangement fees and undrawn commitment fees, of £6.0 million. On adoption of
IFRS, land purchased on deferred terms is capitalised at cost and any difference
between cost and the nominal price to be paid to the vendor is charged as a
finance charge over the period of deferment using the effective interest method.
During 2005, the Group incurred £3.0 million of such finance charges.

Taxation

The Group's tax charge for the year amounted to £34.6 million, after crediting
an adjustment in respect of prior years amounting to £0.4 million. The current
tax charge included £0.5 million of tax credit associated with £1.75 million of
special pension contributions paid during 2005 as part of a medium term plan to
eliminate the past service pension deficit identified in the last actuarial
valuation.

A deferred tax charge of £0.3 million has been accounted for within the Group's
tax charge. This deferred tax charge included a charge of £0.3 million to
reflect the temporary difference in respect of the pension scheme contributions
not charged to the income statement.

Dividends

Under IFRS, dividends have to be declared to enable them to be charged and
accrued. During May 2005, the Group approved and paid the final dividend for
2004 of 13.6 pence per share, at a total cost of £16.1 million. During September
2005, the Group declared the 2005 interim dividend of 8.3 pence per share, which
was paid in November 2005 and amounted to £9.8 million. Therefore, the dividend
charge for 2005 amounted to £25.9 million (2004: £20.5 million) and was covered
3.2 times by post tax earnings.

Dividend cover measured by the basic earnings per share of 69.0 pence over the
total paid and proposed dividends in 2005 of 25.0 pence per share (8.3 pence per
share paid and 16.7 pence per share proposed) amounted to 2.8 times.

Net assets

Net assets increased by £59.9 million during the year to £598.1 million. This
increase included retained earnings after dividend charges of £55.6 million and
£4.8 million of issued share capital and share premium arising from the exercise
of share options by employees and scrip dividend elections. Offsetting these
increases were actuarial losses, net of deferred tax, of £2.0 million on the
Group's defined benefits pension scheme which are charged to reserves.

Analysis of net assets
                                                         2005          2004
                                                           £m            £m
-------------------------------------------------------------------------------
Net assets at 1 January                                 538.2         456.2
Retained profit                                          55.6          81.2
Share capital issued                                      4.8           1.8
Actuarial loss on defined benefits pension scheme        (2.0)         (1.3)
Deferred tax on other employee benefits                   0.9             -
Adjustment to the fair value of cash flow hedges          0.3           0.6
Adjustment to reserves through share based payments       0.3          (0.3)                    
-------------------------------------------------------------------------------
Net assets at 31 December                               598.1         538.2
-------------------------------------------------------------------------------


Net borrowings

The Group ended the year with net borrowings of £61.8 million having started
2005 with net borrowings of £16.8 million. The Group had fixed rate borrowings
at 31 December 2005 of £40.8 million, including a fair value adjustment for the
interest rate swaps of £0.8 million, and floating rate borrowings of £15.0
million. The balance of net borrowings arose through use of the Group's bank
overdraft facility.

Return on average capital employed

Return on average capital employed for 2005 amounted to 20% based on the
operating profit of the Group of £125.1 million and average capital employed of
£637.4 million. For the eighth consecutive year, the Group has met its objective
of achieving a minimum return on capital employed of 20%.


Pension scheme accounting

The latest triennial actuarial valuation of the Group's defined benefit pension
scheme was completed as at 30 June 2004. This valuation indicated that the total
market value of the scheme's assets was sufficient to cover 77% of the present
value of the scheme liabilities in respect of member service up to the valuation
date, including allowance for future salary increases to normal retirement age.
The past service deficit based on this funding level amounted to £10.23 million.
The Group decided to remedy this deficit during the period of July 2004 to April
2007, with a number of agreed special contributions to the pension scheme,
totalling approximately £11.0 million when interest is taken into account. The
first of these special contributions was made during 2004 and amounted to £1.85
million. Further payments were made in 2005 totalling £1.75 million.

Under IFRS, the Group has implemented the requirements of IAS19 (Revised):
'Employee benefits'. The Group's actuary has estimated the position of the
defined benefits pension scheme as at 31 December 2005 under the requirements of
IAS19. The pension scheme held a deficit at that time of £22.4 million which
represented an increase in deficit over the position at 1 January 2005 when the
deficit was £20.5 million. During 2005, the Group contributed £3.6 million to
the pension scheme. The expense in the income statement in 2005 was £2.6 million
and the pension scheme endured £2.9 million of actuarial losses during the year.

Analysis of pension scheme deficit
                                                          2005         2004
                                                            £m           £m
--------------------------------------------------------------------------------
Pension deficit at 1 January                             20.5          19.7
Contributions into the pension scheme                    (3.6)         (3.7)
Expense to the income statement                           2.6           2.6
Actuarial loss on defined benefits pension scheme         2.9           1.9
-------------------------------------------------------------------------------
Pension deficit at 31 December                           22.4          20.5                   
--------------------------------------------------------------------------------


The actuarial losses arose from discounting the pension scheme liabilities at a
lower discount rate than before, 4.7% compared to 5.3% in 2004, as required by
IAS19. The discount rate is set based on the yield achievable on AA bonds with a
similar maturity to the pension scheme liabilities. This generated an actuarial
loss of £8.8 million. In mitigation of this loss, the pension scheme assets
increased in value ahead of expectations giving an actuarial gain of £6.3
million. There was also an actuarial experience loss of £0.4 million.

Cash flow

Cash generated from operations amounted to £28.2 million (2004: £101.6 million).
This lower level of cash inflow reflected the Group's significant investment in
the working capital base during 2005, particularly in land with residential
planning consent. After accounting for capital expenditure, finance costs,
dividend payments and tax payments, the net borrowings of the Group increased by
£45.0 million from £16.8 million at 1 January 2005 to £61.8 million at 31
December 2005.


Bank facilities and liquidity risk

The Group held bank facilities of £220.0 million at 31 December 2005, made up of
bilateral committed revolving loan facilities held with six banks, all being
five year facilities put in place on 7 February 2005 with a maturity date of 6
February 2010.

The Group's net borrowing position at 31 December 2005 of £61.8 million
continued to reflect modest gearing of 10%. With average net borrowings of £88.1
million, the average gearing of the Group during 2005 was 16%. Given timing
differences between the investments in working capital and the flow of legal
completion monies from house sales, the Group's peak net borrowings during 2005
were £158.9 million.

The Group believes that its bank facilities of £220.0 million, along with its
day to day overdraft facility, are sufficient to enable funding of foreseeable
cash flows required for the medium term plans for the Group. As these are
bilateral revolving committed loan facilities there is considerable flexibility
available to the Group to manage its borrowing needs.

Interest rate risk

By fixing an element of borrowings through interest rate swaps with varying
maturities, the Group has made certain its interest costs on what is considered
its core borrowing requirement. Borrowings in excess of this core borrowing are
judged on a case by case basis at the time of drawing down the loans in terms of
interest rate flexibility and loan maturity. The Group has the ability to borrow
using its bilateral committed revolving loan facilities for as little as a few
days or up to the period through to maturity of the relevant facility. The Group
can decide with its banks whether to fix the interest rate of borrowing through
the further use of interest rate swaps, although care is taken to marry together
the dates of draw down and maturity of the floating rate borrowing and interest
rate swap. Up to 10 December 2005, the Group held interest rate swaps over £75
million of its borrowings. On 10 December 2005, a £35 million interest rate swap
matured and was not renewed given the Group's prevailing borrowings position at
that time. Therefore, at 31 December 2005, the Group held interest rate swaps
over £40 million of its borrowings.

The fair value of the Group's fixed rate borrowings at 31 December 2005 exceeded
its book value by £0.8 million. This reflected the movement in long term
interest rates since these financial instruments were established.

International Financial Reporting Standards

The results for 2005 are the first results reported under IFRS and have been
prepared on the basis of IFRSs as adopted by the EU. The comparative results for
the year ended 31 December 2004 have been stated under IFRS. The Group published
a report on 16 June 2005 entitled 'Preliminary information on the implementation
of International Financial Reporting Standards' which provided information on
the impacts of IFRS on the Group, presented the Group's IFRS accounting
policies, and restated the results for the year ended 31 December 2004 under
IFRS compared to the previous UK GAAP. This report indicated that the impact of
IFRS on the Group at 31 December 2004 was to reduce net assets by £7.1 million.
As at 31 December 2005, the comparable impact of IFRS was a reduction in net
assets of £6.0 million. The impact of IFRS on the profit and loss account for
the year ended 31 December 2005 was to reduce pre tax profits by £0.4 million.

David Ritchie
Finance Director


Bovis Homes Group PLC
Group income statement
For the year ended 31 December 2005
                                                  2005              2004
                                                  £000              £000
--------------------------------------------------------------------------------
Revenue - continuing operations                521,194           559,464
Cost of sales                                 (351,997)         (362,316)
--------------------------------------------------------------------------------
Gross profit                                   169,197           197,148
Administrative expenses                        (44,120)         (45,625)
--------------------------------------------------------------------------------
Operating profit before financing costs        125,077           151,523
Financial income                                   557             1,228
Financial expenses                              (9,556)          (7,938)
--------------------------------------------------------------------------------
Net financing costs                             (8,999)          (6,710)
--------------------------------------------------------------------------------
Profit before tax                              116,078           144,813
Income tax expense                             (34,603)         (43,089)
--------------------------------------------------------------------------------
Profit for the period attributable to equity
holders of the parent                           81,475           101,724
--------------------------------------------------------------------------------
Basic earnings per ordinary share                 69.0p             86.8p
--------------------------------------------------------------------------------
Diluted earnings per ordinary share               68.9p             86.4p
--------------------------------------------------------------------------------



Bovis Homes Group PLC
Group balance sheet
At 31 December 2005                      2005                     2004
                                         £000                     £000
--------------------------------------------------------------------------------
Assets
Property, plant and equipment          14,663                   12,910
Investments                                23                       23
Deferred tax assets                    11,447                   10,193
Trade and other receivables             5,727                    5,870
--------------------------------------------------------------------------------
Total non-current assets               31,860                   28,996
--------------------------------------------------------------------------------   
Inventories                           781,373                  699,917
Trade and other receivables            70,523                   36,032
Cash                                      344                   59,486
--------------------------------------------------------------------------------
Total current assets                  852,240                  795,435
--------------------------------------------------------------------------------             
Total assets                          884,100                  824,431
--------------------------------------------------------------------------------
Equity
Issued capital                         59,699                   59,146
Share premium                         146,849                  142,577
Hedge reserve                            (561)                   (889)
Retained earnings                     392,160                  337,381
--------------------------------------------------------------------------------
Total equity                          598,147                  538,215
--------------------------------------------------------------------------------
Liabilities
Bank loans                             40,802                   40,894
Trade and other payables               32,666                   21,465
Retirement benefit obligations         22,370                   20,510
Provisions                              1,345                    1,586
--------------------------------------------------------------------------------
Total non-current liabilities          97,183                   84,455
--------------------------------------------------------------------------------
Bank overdraft                          6,367                        -
Bank loans                             15,000                   35,376
Trade and other payables              151,493                  145,298
Tax liabilities                        15,910                   21,087
--------------------------------------------------------------------------------
Total current liabilities             188,770                  201,761
--------------------------------------------------------------------------------
Total liabilities                     285,953                  286,216
--------------------------------------------------------------------------------
Total equity and liabilities          884,100                  824,431
--------------------------------------------------------------------------------


These accounts were approved by the Board of directors on 10 March 2006.


Bovis Homes Group PLC
Group statement of cash flows
For the year ended 31 December 2005
                                                     2005            2004
                                                     £000            £000
--------------------------------------------------------------------------------
Cash flows from operating activities
Profit for the year                                81,475         101,724
Depreciation                                        1,509           1,465
Investment income                                    (557)         (1,228)
Interest expense                                    9,556           7,938
(Profit)/loss on sale of property, plant and
equipment                                             (56)             27
Equity-settled share-based payment expenses           423             799
Income tax expense                                 34,603          43,089
--------------------------------------------------------------------------------
Operating profit before changes in working
capital and provisions                             126,953         153,814
--------------------------------------------------------------------------------
Increase in trade and other receivables           (34,442)        (21,952)
Increase in inventories                           (81,456)        (67,874)
Increase in trade and other payables               18,154          38,662
Decrease in provisions and employee benefits         (990)         (1,010)
--------------------------------------------------------------------------------
Cash generated from operations                     28,219         101,640
--------------------------------------------------------------------------------
Interest paid                                     (10,467)         (6,289)
Income taxes paid                                 (39,450)        (40,750)
--------------------------------------------------------------------------------
Net cash from operating activities                (21,698)         54,601
--------------------------------------------------------------------------------
Cash flows from investing activities
Interest received                                     651           1,155
Acquisition of property, plant and equipment       (3,303)         (6,232)
Proceeds from the sale of plant and equipment          97              68
Purchase of own shares                               (351)         (1,351)
Sale of own shares                                    128             216
--------------------------------------------------------------------------------
Net cash from investing activities                 (2,778)         (6,144)
--------------------------------------------------------------------------------
Cash flows from financing activities
Dividends paid                                    (25,858)        (20,517)
Proceeds from issue of share capital                4,825           1,820
Repayment of borrowings                           (20,000)              -
--------------------------------------------------------------------------------
Net cash from financing activities                (41,033)        (18,697)
--------------------------------------------------------------------------------
Net (decrease)/increase in cash and cash
equivalents                                       (65,509)         29,760
Cash and cash equivalents at 1 January             59,486          29,726
--------------------------------------------------------------------------------
Cash and cash equivalents at 31 December           (6,023)         59,486
--------------------------------------------------------------------------------



Bovis Homes Group PLC
Group statement of recognised income and expense
For the year ended 31 December 2005
                                                     2005            2004
                                                     £000            £000
--------------------------------------------------------------------------------
Effective portion of changes in fair value of
interest rate cash flow hedges                        468             902
Deferred tax on changes in fair value of interest
rate cash flow hedges                                (140)           (271)
Actuarial losses on defined benefits pension
scheme                                             (2,850)         (1,880)
Deferred tax on actuarial losses on defined
benefits pension scheme                               855             564
Deferred tax on other employee benefits               869               -
--------------------------------------------------------------------------------
Net expense recognised directly in equity            (798)           (685)
Profit for the period                              81,475         101,724
--------------------------------------------------------------------------------
Total recognised income and expense for the
period attributable to equity holders of 
the parent                                         80,677         101,039
--------------------------------------------------------------------------------



Notes to the accounts

1 Basis of preparation

Bovis Homes Group PLC ('the Company') is a company domiciled in the United
Kingdom. The consolidated financial statements of the Company for the year ended
31 December 2005 comprise the Company and its subsidiaries (together referred to
as 'the Group') and the Group's interest in associates.

The consolidated financial statements were authorised for issue by the directors
on 10 March 2006. The accounts were audited by KPMG Audit Plc.

EU law (IAS Regulation EC 1606/2002) requires that the consolidated financial
statements of the Group, for the year ended 31 December 2005, be prepared in
accordance with International Financial Reporting Standards adopted for use in
the EU ('IFRS'). The consolidated financial statements have been prepared on the
basis of the recognition and measurement requirements of IFRS in issue endorsed
by the EU and effective (or available for early adoption) at 31 December 2005,
the Group's first annual reporting date at which it is required to use adopted
IFRS. Comparative information for the year ended 31 December 2004 has been
stated on an IFRS basis.

The financial information included within this statement does not constitute the
Company's statutory accounts for the year ended 31 December 2004 or 2005. The
information contained in this statement has been extracted from the statutory
accounts of Bovis Homes Group PLC for the year ended 31 December 2005, which
have not yet been filed with the Registrar of Companies, on which the auditors
have given an unqualified audit report, not containing statements under section
237(2) or (3) of the Companies Act 1985.

The preparation of financial statements in conformity with IFRS requires
management to make judgements, estimates and assumptions that affect the
application of policies and reported amounts of assets and liabilities, income
and expenses. The estimates and associated assumptions are based on historical
experience and various other factors that are believed to be reasonable under
the circumstances, the results of which form the basis of making judgements
about carrying values of assets and liabilities that are not readily apparent
from other sources. Actual results may differ from these estimates.

The accounting policies have been applied consistently for all periods presented
in the consolidated financial statements and in preparing an opening IFRS
balance sheet at 1 January 2004 for the purpose of the transition to IFRS.

2 Basis of consolidation

The consolidated financial statements incorporate the accounts of the Company
and entities controlled by the Company (its subsidiaries) made up to 31
December. Control is achieved where the Company has the power to govern the
financial and operating policies of an entity so as to obtain benefits from its
activities. The existence and effect of potential voting rights that are
currently exercisable or convertible are considered when assessing whether the
Group controls another entity.

Associates are those entities in which the Group has significant influence, but
not control, over the financial and operating policies. The consolidated
financial statements include the Group's share of the total recognised gains and
losses of associates on an equity accounted basis, from the date that
significant influence commences until the date that significant influence
ceases.

3 Accounting policies

The Group's IFRS accounting policies were drawn up as part of the Group's IFRS
transition and implementation process completed during 2005. These accounting
policies were disclosed in full within the Group's interim report published on
12 September 2005. It was noted at that time that the accounting policies were
based on interpretations by management of IFRSs which were anticipated to be
effective as at 31 December 2005. These interpretations were subject to change
as the requirements of IFRSs became more certain and uncertainties were
clarified. The Group has finalised its IFRS accounting policies as part of its
2005 financial year end. The substance of the accounting policies has remained
unchanged from those previously reported. There has been some minor amendment to
the wording of the accounting policies. These accounting policies will be
disclosed in full within the Group's forthcoming financial statements.

4 Reconciliation of net cash flow to net debt
                                                     2005            2004
                                                     £000            £000
--------------------------------------------------------------------------------
Net (decrease)/increase in net cash and cash
equivalents                                       (65,509)         29,760
Repayment of borrowings                            20,000               -
Fair value adjustments to interest rate swaps         468             902
Net debt at start of period                       (16,784)        (47,446)
--------------------------------------------------------------------------------
Net debt at end of period                         (61,825)        (16,784)
--------------------------------------------------------------------------------
Analysis of net debt:
Cash and cash equivalents                          (6,023)         59,486
Bank loans                                        (55,000)        (75,000)
Fair value of interest rate swaps                    (802)         (1,270)
--------------------------------------------------------------------------------
Net debt                                          (61,825)        (16,784)
--------------------------------------------------------------------------------


5 Income taxes

Current tax

Current tax expense is the expected tax payable on the taxable income for the
year, calculated using a corporation tax rate of 30% applied to the pre-tax
income, adjusted to take account of deferred taxation movements.

Current tax for current and prior years 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.

6 Dividends

The following dividends were paid by the Group.
                                                                2005      2004
                                                                £000      £000
--------------------------------------------------------------------------------

Prior year final dividend per share of 13.6p (2004: 11.1p)    16,036    12,981
Current year interim dividend per share of 8.3p (2004: 6.4p)   9,822     7,536
--------------------------------------------------------------------------------
Dividend cost                                                 25,858    20,517
--------------------------------------------------------------------------------

A final dividend in respect of 2005 of 16.7 pence per share, amounting to a
total dividend of £19,813,000 based on the shares in issue as at 10 March 2006,
was proposed by the Board on 10 March 2006. This final dividend will be paid on
26 May 2006 to shareholders on the register at the close of business on 31 March
2006. This dividend has not been recognised as a liability at the balance sheet
date.

7 Earnings per share

Basic earnings per ordinary share for the year ended 31 December 2005 is
calculated on profit after tax of £81,475,000 (year ended 31 December 2004:
£101,724,000) over the weighted average of 118,119,910 (year ended 31 December
2004: 117,196,194) ordinary shares in issue during the period.

Diluted earnings per ordinary share is calculated on profit after tax of
£81,691,000 (year ended 31 December 2004: £102,034,000) over the diluted
weighted average of 118,595,375 (year ended 31 December 2004: 118,125,595)
ordinary shares potentially in issue during the period. The diluted average
number of shares is calculated in accordance with IAS 33: 'Earnings Per Share'.
The dilutive effect relates 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. The profit
after tax used in the diluted earnings per share calculation includes an
adjustment to reverse the charge within the income statement in respect of the
fair value of share options in issue. The reversal for the year ended 31
December 2005 was £216,000 (year ended 31 December 2004: £310,000).

8 Explanation of transition to IFRS

An explanation of how the transition from UK GAAP to IFRS has affected the
Group's financial position, financial performance and cash flows was published
by the Group on its website on 16 June 2005, contained within a document
entitled 'Preliminary information on the implementation of International
Financial Reporting Standards for the year ended 31 December 2004'. This
document included a reconciliation of equity reported under UK GAAP and IFRS at
1 January 2004, the date of transition to IFRS.

9 Circulation to shareholders

The consolidated financial statements will be sent to shareholders on or about 5
April 2006. 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.bovishomesgroup.plc.uk, including the slide presentation
document which will be presented at the Group's results meeting on 13 March
2006.




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