Interim Results for the Six Months ended 31st March 2003

1

• Interim Resultsfor the Six Monthsended 31st
  March 2003
• 24 June 2003

2
Contents

• Page No.
• Grainger Trust Corporate Introduction 3
• Highlights 4
• Financial Position
• - Summary Profit and Loss Account 5
• - Market Value Balance Sheet 6
• - NAV Movements 7
• - Cashflow 8
• - Debt Cost 9
• - Debt Maturities 10
• Tenanted Residential
• - Commentary and Key Points 11
• - Key Performance Facts 12
• - Portfolio Status 13
• - Portfolio Analysis by Total VP Value of
  Residential Units 14
• - Portfolio Analysis by Number of Units 15
• - Regional Analysis 16
• Bromley Joint Venture
• - Key Points 17

3
Grainger Trust Corporate Introduction

• Grainger Trust is the UKs largest quoted
  residential property investor and trader.
• Owns and manages 5,138 units, and through its JV
  in BPT has exposure to a further 6,685 units.
• Business is high margin and strongly cash
  generative.
• Also acquires, develops and trades residential
  and commercial property sites.

4
Highlights

• 33 increase in PBT from 16.8m to 22.4m
• 79 increase in EPS from 29.8p to 53.3p
• Dividend growth of 15 per annum maintained
• Strong purchasers of replacement stock (45m
  spent)
• Major sales programmes at BPT joint venture
  complete
• Dividend of 52m from JV received in period

5
Financial Position Summary Profit and Loss
Account
6
Financial Position - Market Value Balance Sheet
Note No revaluation of assets at 31 March 2003
7
Financial Position NAV Movements
NNNAV at 30 September 2002 12.03 and 298
8
Financial Position - Cashflow
9
Financial Position Debt Cost
30.09.02
31.03.03
Variable/Under One Year
5.1 48m
4.7 37m
4.9 63m
5.2 63m
Hedged
6.4 88m
6.4 88m
Fixed Over One Year
9.8 35m
9.8 35m
Fixed Rate
223m
234m
Gross Debt
83
79
Hedging Level
Blended Interest Rate
6.2
6.3
48
52
Gearing Level
10
Financial Position Debt Maturities
30.09.02
31.03.03
27m
24m
Over Ten Years
22m
96m
Between 5 and 10 years
91m
22m
56m
55m
Between 2 and 10 years
22m
31m
33m
Between one and two years
22m
22m
One Year or Less
22m
223m
234m
Gross Debt
23m
10m
Cash
Net Debt
200m
224m
6.7 years
Average maturity
6.9 years
11
Tenanted Residential- Commentary and Key Points

• Robust sales performance in period, exceeding
  September VPs by 6.5.
• Heavy investment programme, 592 units for total
  consideration of 45m.
• Exposure to Central London low, geographic spread
  protects against hot spot movements.
• Low average VP values at 108K improve
  saleability.
• High margin business (46.5 gross margin on
  sales) so discounting can give greater price
  flexibility.
• Residential skills being leveraged to produce
  other returns eg mixed use development schemes,
  asset and property management.

12
Tenanted Residential Key Performance Facts
13
Tenanted Residential Portfolio Status
14
Tenanted Residential Portfolio AnalysisBy
Total VP Value of Residential Units
31 March 2003
30 September 2002
19m 3.4
21m 4.1
19m 3.4
91m 16.3
21m 4.1
86m 16.9
110m 19.8
98m 19.3
180m 32.3
153m 30.2
102m 18.3
91m 17.9
59m 11.6
55m 9.9
Total VP Value 508m
Total VP Value 557m
15
Tenanted Residential Portfolio AnalysisBy
Number of Units
31 March 2003
30 September 2002
25 0.5
277 5.4
31 0.6
259 5.3
524 10.2
466 9.5
1,347 26.2
1,137 23.1
1,200 24.3
1,337 26.0
1,835 37.2
1,628 31.7
Total Units 4,928
Total Units 5,138
16
Tenanted Residential Regional Analysis

• Some 12.4 of our properties, by value, are in
  Central London.
• 9 of our properties are valued above 350K
  (vacant possession).

17
Bromley Joint Venture Key Points

• Sales in period of 81m, cost of 58m.
• Total sales since acquisition 454m, cost of
  400m.
• Remaining portfolio valued at 668m.
• JV generated 4.0m pre tax profits for Grainger.
• 52m dividend received following December
  refinancing
• Total cash received to date 85.9m, initial
  investment 56m.

18
Bromley Joint Venture
19
Bromley Joint Venture GT Investment Return
20
Development and Trading Key Points

• Operating profit up to 5.4m from 4.9m.
• Seven acres of land sold at Kennel Farm for
  6.9m.
• No other major sales in period but subsequent to
  half year, Townsend House sold for 8.2m to
  produce profit of 2.6m.
• Contracts exchanged on 75 of Pimlico flats to
  produce 30m on completion.
• Selected by London Borough of Islington for two
  mixed use regeneration schemes in North London.

21
Commentary on Sites With End Development Value
gt20m
Property Description Status Slough Mixed use
development Construction completed (office
element 69,000 sq.ft) May 03. Hotel site sold.
Health and Fitness unit let. Retail/A3 to be
let. Pimlico, SW1 Residential development 61
units out of 79 now exchanged. Completion
summer 04. Macaulay Road, 110,000 sq.ft mixed
use scheme Revised planning application to
Clapham, SW4 be submitted. Anticipated
decision in early 04. Project completion
Mid 06. Hornsey Road Baths Public/private
partnership mixed Selected as preferred
development Barnsbury Complex use scheme 350
residential units, partner. Phased completions
to 08. Islington 43,000 sq.ft. Council office
and Land purchase 2004-2006. community uses.
Kennel Farm, Sale of serviced plots to
housebuilders 7 acres sold in current year.
Terms Basingstoke agreed to sell further 23
acres in 03/04.
22
Way Forward

• Continue to focus on core TR business.
• Expand life tenancy business
• Use strong cashflow to maintain TR stock and to
  invest in entrepreneurial high return activities.
  
• Continue to look at opportunities for using
  existing skills and balance sheet in
  complementary areas- asset and property
  management, residential and mixed used
  developments, joint venture and partnership
  agreements.

23
Appendices

• Types of Tenancy
• Detailed Profit and Loss Account Grainger Trust
  plc
• Detailed Profit and Loss Account Grainger Trust
  Group
• Profit and Loss Account Account Effect of FRS
  19
• Tenanted Residential Stock Analysis
• Investment in Bromley JV

24
Summary of Tenancy Types
Regulated
Assured Periodic
Assured
Life Tenancies
Assured Shorthold
Rent Act 1977
Housing Act 1988
Housing Act 1988
-
Housing Act 1988
Regulated by
Security of tenure
Yes - with succession rights
Yes
Yes
Yes
No
Rent
Market rent
Market rent
Market rent
Usually no rent
Set by rent officer every two years. Increases
capped at RPI 2.5 per annum.
Since 1988 no new regulated therefore declining
stock
Tenants transfer ownership in return for
rent-free occupation and lump sum
Other characteristics
Tenant has the right to renew tenancy
Landlord may get possession if appropriate
notice is served
Tenancy arises as a result of succession from
regulated
25
Detailed Profit and Loss Account Grainger Trust
Group
26
Detailed Profit and Loss Account Grainger Trust
plc
27
Profit and Loss Account Effect of FRS 19
28
Tenanted Residential Stock Analysis
29
Investment in Bromley Joint Venture
30

• Interim Resultsfor the Six Monthsended 31st
  March 2003
• 24 June 2003