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DELIVERING VALUE THROUGH HOUSEBUILDING AND BROWNFIELD DEVELOPMENT

SEPTEMBER 2017

PRELIMINARY RESULTS PRESENTATION

Year ended 30 June 2017

DELIVERING VALUE THROUGH HOUSEBUILDING AND BROWNFIELD DEVELOPMENT

BUSINESS MODEL

ACTIVITIES

Land Housebuilding Construction

▪ 100% track record in obtaining residentially-led, mixed-use planning consents ▪ Acquisition of predominantly brownfield land in town centres and regeneration areas ▪ Secure options over strategic land and focus on capital light structures such as joint ventures ▪ Area of operations around M25 and M11 corridor as well as South Coast ▪ Target to obtain consents between 18

• 24 months from acquisition

▪ Choice of:

• disposal to developers
• disposal with construction contract
• development by Inland Homes

▪ Target land value uplift between 60%

• 100%

▪ Target market for homes priced between c £200k - £450k ▪ Construction of private units for open market sale on sites brought through the planning process by the Group ▪ Construction of private and affordable housing for partners such as housing associations where land purchased from Inland Homes ▪ Constructing more apartments than houses ▪ Developed in-house construction team ▪ Far less reliance on main contractors ▪ 427 units under construction including 316 units through self- delivery ▪ Act as contractor for housing associations where sites purchased from Inland Homes ▪ Construction output increasing

STRATEGY ▪ Increase the size of land bank

• brownfield sites
• strategic sites
• tactical sites to unlock future

potential value ▪ Priority to secure planning consents on Inland’s major projects including strategic sites ▪ Maximise value through housebuilding

• capture land profit
• capture development profit

▪ Ensure strong and flexible balance sheet

• manage borrowings
• focus on cash management

KEY HIGHLIGHTS

▪ Robust results with strong profitability and significantly improved balance sheet ▪ 12.2% increase in net asset value to £131m ▪ 188 (2016: 147) private units sold ▪ Current forward sales of £33 million and construction contracts of £41 million ▪ 31% increase in total dividend of 1.7p ▪ Land bank of 6,936 plots (2016: 6.681) after disposal of 780 plots and 188 units in the year ▪ Planning application for 350 homes and commercial space on Wilton Park, Beaconsfield submitted in September 2017 ▪ 427 units under construction of which 74% through self-delivery 30 June 2017 30 June 2016 restated Profit before tax & before revaluation gain EPRA NAV Stated NAV Net current assets Cash Net gearing Net EPRA gearing £18.1m £194.4m £130.6m £159.9m £26.5m 52.1% 35.0% £15.7m £186.3m £116.3m £96.7m £16.7m 46.9% 29.3%

FINANCIAL HIGHLIGHTS 30 June 2017 30 June 2016 restated Revenue £90.7m £101.9m Two land disposals shown as gains separately Gross profit £19.5m £29.6m Administrative expenses £7.6m £6.3m Expansion of in-house construction teams and HO staff Gain on sale of subsidiary and JV £13.0m

• Sale of Alperton site and 50% of Aylesbury

Revaluation of investment properties £1.5m £18.0m Further valuation increase in 86 residential properties at Wilton Park, Beaconsfield Profit before tax £19.6m £33.7m Significant revaluation gain in previous period Proposed final dividend per share 1.2p 0.9p 33% increase Non-current assets £67.1m £54.5m Increase in loans to associates and debtors > 1 year Current assets £207.1m £185.5m Increase in receivables and cash Current liabilities £47.2m £88.8m Borrowings restructured with over 50% maturing after three years Non-current liabilities £96.5m £34.8m

25% 64% 3% 2% 3% 3%

Revenue by segment

Land sales Housebuilding Contract Rental Hotel Fees & other

SEGMENTAL ANALYSIS

31% 44%

• 1%

10% 1% 13%

Gross profit by segment 30 June 2017 30 June 2016 restated Revenue Land sales £22.4m £43.3m 207 (2016: 425) plots sold across 7 sites Housebuilding £57.8m £51.5m 188 (2016: 147) private units sold Contract income £3.1m £2.9m Rental income £2.3m £2.1m Hotel income £2.6m £1.7m Relates to Wessex hotel site Management fees & other £2.5m £0.4m Additional revenue received on a land sale £90.7m £101.9m Gross profit Land sales £6.2m £17.0m Two land sales via corporate disposals Housebuilding £8.7m £11.3m Contract income (£0.2m) (£0.7m) Rental income £2.1m £1.7m Predominantly from investment properties at Wilton Park Hotel income £0.2m

• Management fees & other

£2.5m £0.3m £19.5m £29.6m

ROBUST FINANCIAL POSITION 30 June 2017 30 June 2016 restated

Non-current assets

• Investment properties

£53.6m £51.7m

• Investment and amounts due from

associate and JVs £7.1m £2.2m Loan of £3m to Troy Homes and deferred consideration on two land disposals

• Receivables > 1 year

£5.8m

• Deferred consideration on land disposal

Current assets

• Inventories

£139.9m £148.4m

• Trade receivables

£22.5m £6.8m Principally deferred consideration on land disposals

• Due from JVs

£18.3m £10.1m

• Cash

£26.5m £16.7m Current liabilities

• Borrowings
• £40.1m

Restructured borrowings

• Other

£47.2m £48.6m Non-current liabilities

• Borrowings

£94.5m £31.1m 54% of debt maturing after 3 years

• Other

£2.0m £3.6m Net assets £130.6m £116.3m Average maturity of debt (years) 2.7 1.9 Weighted average cost of debt:

• Housebuilding

3.5% 3.9%

• Land & investment properties

6.2% 7.8%

▪ Project Helix

• Joint venture platform to acquire sites

between £7m – £20m

• Inland required to inject 20% equity
• 15% priority return on equity from both

partners

• Minimum 40% to Inland, thereafter

enhanced returns based on hurdles

• Inland’s equity invested at 30 June 2017:

£8.5m

• Projects: Church Road, Ashford (357 units),

Lily’s Walk, High Wycombe (239 units), Buckingham House, High Wycombe (85 units) ▪ Cheshunt Lakeside Developments

• 50:50 joint venture with leverage
• Inland’s investment: £8.2m
• 50% share of profits
• Management fee to Inland
• Project: Delamare Road, Cheshunt (1,400

units) ▪ Garston

• 50:50 joint venture with landowner
• Inland’s investment: £4.4m
• 50% share of profits
• Management fee for Inland
• Project: Bucknalls Lane, Garston (100 units)

▪ Chapel Riverside, Southampton

• Joint venture with landowner
• Inland’s investment: £2.3m
• Priority return to Inland
• 457 units

JOINT VENTURES

DELIVERING VALUE THROUGH HOUSEBUILDING AND BROWNFIELD DEVELOPMENT

LAND PORTFOLIO

VISIBLE AND GROWING PIPELINE OF FUTURE OPPORTUNITIES

1,057 1,318 1,086 1,048 1,994 307 605 1,344 1,124 493 66 143 1,329 2,589 1,836 114 49 942 1,811 1,303 1,805 2,470 2,306 3,734 5,176 6,681 6,936

• 1,000

2,000 3,000 4,000 5,000 6,000 7,000 8,000 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017

Land Bank

Plots controlled or terms agreed without consent (including strategic options) Plots controlled or terms agreed with consent or resolution to grant planning consent Managed or held within joint ventures without consent (contracted or terms agreed) Managed or held within joint ventures with consent (contracted or terms agreed) Owned or contracted without planning consent Owned or contracted with planning consent or resolution to grant planning consent Total

1249 2,416 3,976 5,518 4,799 1,057 1,318 1,200 1,163 2,137 2,306 3,734 5,176 6,681 6,936 500 1000 1500 2000 2500 3000 3500 4000 4500 5000 5500 6000 6500 7000 7500 FY 2012 FY 2013 FY 2014 FY 2015 FY 2017

Plots owned / managed

Plots With Planning Permission Plots Without Planning Permission

Significant brownfield and strategic land bank with visible pipeline of opportunities

100% RECORD OF OBTAINING PLANNING PERMISSION

Planning status of residential plots Visible pipeline of assets moving through the planning cycle Strategic To be progressed Pre-application discussions Planning applications submitted Target plots for consent by 31 December 2017 Ownership status

• No. of

plots

• No. of sites
• No. of

plots

• No. of sites
• No. of

plots

• No. of sites
• No. of

plots

• No. of sites

Managed or held in joint ventures (contracted or terms agreed)

• 46

1 1,470 1 366 1

• Owned or contracted
• 28

1 28 2 391 2 399 Plots controlled or terms agreed 1,798 17 128 1 472 6 72 1

• Grand Total

1,798 17 202 3 1,970 9 829 4 399 Planning status of commercial space To be progressed Pre-application discussions Planning applications submitted Ownership status

• No. of sites

Sq ft

• No. of sites

Sq ft

• No. of sites

Sq ft Managed or held in joint ventures (contracted or terms agreed)

• 1

30,000 1 11,420 Owned or contracted

• 1

53,820 1 22,808 Plots controlled or terms agreed

• 1

53,820 Grand Total

• 2

83,820 3 88,048

Strategic, 1,798 To be progressed, 202 Pre- application discussions, 1,970 Planning applications submitted, 829

Land progressing through planning system

WILTON PARK, BEACONSFIELD, BUCKINGHAMSHIRE

▪ 100 acres ▪ Estimated GDV £350m ▪ Planning application

submitted for 350 homes

▪ Access road from Pyebush

roundabout now opened

▪ Short term rental income

£1.5m p.a.

▪ Existing residential

properties valued at £46.9m

▪ Site included in Local

Authority’s Preferred Option list for Green Belt release which could result in further residential and commercial space

▪ Savills have described site as

‘one of the finest development opportunities in Southern England’

▪ Former Tesco headquarters

comprising approximately 60%

• f a wider urban regeneration

site

▪ Several additional parcels of

land now purchased or controlled

▪ Acquired in 50/50 joint

venture vehicle

▪ Control 18 out of 30 acres in

the wider Cheshunt Lakeside site

▪ Allocation originally 1,000

units for site

▪ Inland Homes successfully

masterplanning entire site for approximately 2,000 units and 150,000 sq ft of commercial space

▪ Up to 1,400 units on land

• wned or controlled by JV

▪ Planning application expected

to be submitted shortly and consent expected in 2018 CHESHUNT LAKESIDE, HERTFORDSHIRE

LILY’S WALK, HIGH WYCOMBE, BUCKINGHAMSHIRE

▪ 3.5 acre former gas works ▪ Located next to Eden

shopping centre and walking distance to station with 28 minute journey to London

▪ Has detailed planning for

239 studio, 1 and 2 bed apartments

▪ 16,000 sq ft of commercial

space

▪ Purchased joint venture

partner’s share in July 2017

▪ Successful sales launch with

21 exchanges over 2 days

▪ Total forward sales of £5.5m ▪ Construction expected to

start by December 2017

▪ Expected GDV in excess of

£75 million

MARKET ENVIRONMENT – GOVERNMENT SUPPORT Driving demand Assisting supply

1

Help to Buy (HTB)

▪ Facilitates deposit as low as only 5%, through Equity Loan scheme ▪ Represents 44% of Inland’s unit sales

2

Help to Buy ISA & Lifetime ISA

▪ Help to Buy ISA – government contribution of up to 25% of monthly cash savings (up to £50 per month) ▪ Lifetime ISA – 25% government contribution of savings up to £4,000

3

Restrictions on pension savings by higher earners

▪ Lifetime allowance cut from £1.25 million to £1 million – buy- to-let provides an alternative investment option despite increase in buy-to-let levies e.g. increase in SDLT

1

Permitted conversion

▪ Permanent extension of permitted development rights for

• ffice-to-residential conversions from April 2016

▪ Government reviewing how to allow demolition of offices and replacing with new build residential

2

Government’s Housing White Paper

▪ Range of initiatives and funding to speed up the planning and construction process and to assist SMEs and new entrants into the market ▪ Summary of the benefits for Inland included within appendix

3

Planning reform

▪ Focus on reducing the time planning applications spend with decision makers ▪ “Delivery test” introduced to ensure delivery of local homes within a reasonable timeframe

4

Government to provide £5 billion to stimulate housebuilding projects

▪ £2 billion to accelerate construction for homes on publicly

• wned land

▪ £1 billion of short term loans to small housebuilders ▪ £2 billion of long term funding for infrastructure and large projects to deliver up to 200,000 homes

HOUSING MARKET

Strong demand for home ownership due to lack of supply

South East statistics

London South East Population (2016) 8,787,900 9,026,300 Annual population growth rate (2016) 1.3% 0.9% Average weekly earnings £671 £566 Age of first time buyers 32 32 Average house price (June 2017) £482,000 £320,000 Annual house price inflation 2.9% 4.9% Average unemployment (July 2017) 5.2% 3.2%

Sources: ONS, Halifax

Economic forecasts

2017 2018 2019

GDP growth 1.6% 1.6% 1.8% Inflation 2.7% 2.6% 2.2% UK base rate 0.25% 0.5% 0.6%

Source: Bank of England

UK mainstream house price increases (5 year)

Source: Savills

10,250 15,900 38,390 4,190 9,550 22,380 8,120 10,770 11,100 East Midlands East of England London North East North West South East South West West Midlands Yorkshire and The Humber

STRUCTURAL SUPPLY/DEMAND IMBALANCE IN INLAND’S FAVOUR

▪ Significant structural undersupply of housing nationally and particularly in the South East ▪ Estimated requirement of 275,000 homes per annum nationally ▪ Government policies may help stabilise house price growth and increase supply, but it remains to be seen if the 100,000 annual shortfall will be significantly reduced

Net additional dwellings

Source: Office for National Statistics

UK housing demand gap

Source: House of Commons Library, Housing needs and demand

Seasonally adjusted trends in quarterly housing starts and completions, England

Source: Office for National Statistics Source: Halifax House Price Index

House prices to 28 February 2017

STRONG INVESTMENT CASE Large and growing land bank in South and South East England Clear and agile business model Diversified revenue streams with visibility on future earnings Highly experienced management and specialist development teams Significantly improved financial position Supportive market environment

▪ 6,936 plots of which 2,137 have planning consent ▪ Good demand for land with planning consent in the South and South East of England from housebuilders and institutional landlords ▪ Flexibility to realise value in land bank through a number of channels including:

• Housebuilding;
• Consented plot sales;
• Partnership Housing; and
• Investment property

▪ Three land sales in solicitors hands ▪ 427 units under construction ▪ Annualised rental income of £2.6 million provides contribution towards overheads ▪ Construction contracts for £41.5 million ▪ Highly experienced team successfully identifying and securing suitable opportunities and maximising each project's potential ▪ 100% track record in securing planning permissions across all sites by planning team ▪ Net gearing of 52.1% or 35% on EPRA net assets ▪ All borrowings over one year with 54% over three years ▪ Sustainable demand particularly at the Inland price point ▪ All political parties in favour of housing & thus providing support

APPENDICES

APPENDIX 1 - HOUSING WHITE PAPER

Decimal Place, Chiltern Avenue Amersham, Buckinghamshire HP6 5FG Telephone: 01494 762450 Email: info@inlandplc.com www.inlandhomesplc.com