Henry Boot Regulatory News (BOOT)

HENRY BOOT PLC

UNAUDITED HALF-YEARLY RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2015

Henry Boot PLC ('Henry Boot', 'the Company' or 'the Group') (Ticker: BHY: Main market premium listing: FTSE: construction & materials), a company engaged in land development, property investment and development, and construction, announces its half-yearly results for the period ended 30 June 2015.

Commenting on the results, Chairman John Brown said:

"I am pleased to report that Henry Boot has performed very satisfactorily in the first half of 2015 trading in line with management expectations. All our businesses are trading well in their respective markets and economic operating conditions are currently favourable across the Group.

"We continue to have a strong portfolio of strategic land and development opportunities which are delivering profitability in line with appraisal forecasts. Improved investment and tenant demand continues to support the higher levels of commercial activity we are currently undertaking. We have also added a housing development land bank of over 300 units to be delivered over the next three to four years, accessing the high returns that are currently available on housing development.

"Overall, given the strength of the investment market, our construction order book and subject to the completion of certain key transactions during the second half of 2015 and notably around the year end, trading for the year ending 31 December 2015 is expected to be in line with our expectations."

For further information, please contact:

Henry Boot PLC

Jamie Boot, Group Managing Director

John Sutcliffe, Group Finance Director

Tel: 0114 255 5444

www.henryboot.co.uk

Investec Bank plc

Garry Levin

Tel: 020 7597 5000

TooleyStreet Communications

Fiona Tooley

Mobile: 07785 703523

Tel: 0121 309 0099

CHAIRMAN'S STATEMENT

I am pleased to report that Henry Boot has performed very satisfactorily in the first half of 2015 trading in line with management expectations. All our businesses are trading well in their respective markets and economic operating conditions are currently favourable across the Group.

The decision making paralysis prior to the General Election did impact on transactions in the period and resulted in some delay to the completion of two land sales and the exchange of contracts on three others, to the end of the period on 30 June 2015 - a rather busy day! Matters rebounded quickly once the General Election concluded and we expect to see any residual deferred decisions resolved through the second half.

We have an unprecedented number of land sites with planning permission and more larger scale commercial development projects moving towards a start, already being built or completed and being sold than ever before. Detailed comments related to progress within each business segment are made in the performance review below.

It is encouraging that all the larger schemes being worked on have progressed well in the period and we have successfully completed projects and added new opportunities for the future, thereby ensuring we maintain our pipeline of opportunities, capable of delivering shareholder value into the longer term.

Board changes

As separately announced today, I have now completed nine very enjoyable and successful years with Henry Boot PLC, working with my fellow Directors and the teams within the Group businesses. My Non-executive colleague, Mike Gunston, also completes nine years' service later this year and, supporting good corporate governance, both Mike and I will retire from the Board on 31 December 2015.

We have had in mind our succession plan for some time and, therefore, also at the year end, Jamie Boot will retire as Chief Executive and replace me as Non-executive Chairman. He has run the business very successfully for almost 30 years and I can think of no better successor for me, looking after shareholders' interests into the future.

John Sutcliffe, who has been Group Finance Director for the past nine years, will take over as Chief Executive and Darren Littlewood, currently Group Financial Controller, will be appointed as Group Finance Director. The business operations and longer term strategic goals of the Henry Boot Group have been extremely well managed by this team, and I feel very confident that Jamie, John and Darren will take Henry Boot from strength to strength in the future.

To work with this team, we have appointed Joanne Lake, Peter Mawson and Gerald Jennings as new independent Non-executive Directors effective from 1 October 2015, allowing for a sensible handover period. Joanne Lake will also assume the role of Deputy Chairman. These appointees, who will join James Sykes, bring extensive corporate finance, planning, strategic land and commercial development experience to our Board and are, therefore, ideally suited to support our Group Executive team.

I am in no doubt that they will make a strong contribution to the delivery of our strategic goals into the future.

Trading review

Revenue for the period increased to £79.2m (2014: £65.8m) after higher land sales and increased construction and plant hire turnover. The land sale at Exeter, completed in the period, was sold as land owner, which increased turnover and cost of sales proportionately.

Operating profits were slightly lower at £13.3m (2014: £14.0m) after a write-off totalling £1.4m in planning costs on schemes where appeals failed compared to £0.3m in the same period in 2014, although lower interest costs and the £0.7m share of investment property valuation profits of joint ventures resulted in profit before tax 4.5% ahead at £14.0m (2014: £13.4m).

Retained earnings were £11.2m (2014: £10.8m), resulting in a 5% rise in earnings per share to 7.8p (2014: 7.4p).

Statement of financial position

Total non-current assets were slightly lower at £173.1m (31 December 2014: £180.7m). The difference is largely explained by approximately £1.8m of net investment in the plant hire fleet offset by the transfer of £14.4m of investment properties to current assets held for sale. The vast majority of these asset sales have concluded in the period since the half year.

The significant uplift in inventories to £129.3m (31 December 2014: £117.5m) results from the increase of our house building work in progress and significant developments at York, Thorne and schemes at Markham being accounted for as inventories. Strategic land inventories of £100.6m were in line with the prior period (31 December 2014: £99.6m). The increase in trade receivables largely results from the investment in planning and design fees for the Aberdeen scheme recoverable against the building contract on commencement. Cash and cash equivalents were £11.5m higher at £15.8m (31 December 2014: £4.3m) as cash receipts from land sales which concluded on the last day of the period were held in current accounts rather than offset against short-term loan arrangements. Overall, current assets were £40.4m higher at £212.5m (31 December 2014: £172.1m).

Current liabilities rose to £135.3m (31 December 2014: £107.1m) as current borrowings rose to £61.3m (31 December 2014: £32.0m). The £30.1m held in both cash and assets held for sale is expected to reduce this variance in the second half. We are in a much more active development phase and will be utilising higher borrowings as these developments work through to completion, are then sold and cash is recycled back into the work in progress phase of subsequent developments.

Overall, net current assets were £77.3m (31 December 2014: £65.0m). This increase in working capital continues the process that has been ongoing for some time now with the equivalent net current asset figure at 30 June 2013 being £37.3m.

In addition to the increase in the net working capital position, non-current liabilities improved to £38.7m (31 December 2014: £45.3m) largely as a result of the reduced defined benefit pension scheme liabilities under IAS 19 to £20.2m (31 December 2014: £28.2m) assisted by a 0.2% increase in the applicable discount rate, as long-term interest rates began to rise, and we had further, relatively muted growth in the pension scheme assets.

The aforementioned improvement to the pension deficit and retained earnings helped net assets rise to £211.6m (31 December 2014: £200.5m) with net asset value per share at 160p (31 December 2014: 152p) as we successfully continue to increase shareholder value over the longer term.

Cash flows

Operating cash inflows before movements in working capital were £9.9m (2014: £10.6m). Working capital investment in development projects, increasing both inventories and receivables, resulted in working capital outflows of £13.4m (2014: £5.9m) which, in turn, meant that our operations used funding of £3.4m compared to the same period in 2014, when operations generated cash of £4.7m.

Interest paid of £0.5m (2014: £0.6m), tax paid of £1.6m (2014: £2.3m) and further net investment in developments in progress of £7.5m, compared to net property cash receipts of £7.2m in the previous period, resulted in net cash outflows from investing activities of £7.8m compared to 2014 when we generated cash inflows of £6.6m.

Dividends paid in the period increased 14% to £5.7m (2014: £5.0m). Therefore, at 30 June 2015, net debt increased to £55.4m resulting in gearing of 26% (2014: Debt £36.4m, gearing 18%). It is anticipated that the property sales in the second half (noted above) will reduce borrowings and gearing by the year end.

Dividend

The Directors remain confident of Group prospects and I am pleased to report that the Board has approved a 9.5% increase in the interim dividend to 2.3p (2014: 2.1p). This will be paid on 23 October 2015 to shareholders on the Register at the close of business on 25 September 2015.

OPERATIONAL REVIEW

Land development

Hallam Land sold broadly the same number of units, as the comparable half year, although turnover was higher because we were selling land as owner rather than as agent as occurred in the first half of 2014. Underlying that, we are continuing to benefit from the strengthening position of the national house builders who are being supported by improving housing demand and the stronger UK economy.

As we have previously reported, the relatively supportive planning regime over the last two to three years has enabled Hallam Land to obtain more planning permissions than at any other time in its history. Consequently, across the country, we now have 40 sites equating to over 12,000 units, which have planning permission and are available to market, albeit the larger schemes will be sold over a number of years.

In the run-up to the General Election, there was a noticeable hardening of attitudes from planning decision makers and, therefore, in the first half of the year we found that planning permissions were more difficult to obtain. This was particularly noticeable with the Secretary of State decisions on major residential schemes. However, against this difficult backdrop, we successfully achieved 11 new site planning permissions for over 1,600 plots by the end of June 2015.

In the period we completed six land sales and exchanged on three others, broadly in line with the first half of 2014. We are currently in detailed sale negotiations on a further 11 sites, some of which should exchange and may complete before the year end. However, the 2015 Budget changes to affordable housing may add complexity and, therefore, time into that sale process; as yet it is too early to gauge the impact of this legislative change.

We are continuing to identify and sign up new opportunities and increase the size of our site portfolio. At 30 June 2015, we held interests in 188 sites for 10,547 acres (31 December 2014: 9,985) with 1,810 acres owned (31 December 2014: 1,819), 2,763 acres under option (31 December 2014: 2,800) and 5,974 acres under Planning Promotion Agreement (31 December 2014: 5,366). The inventory value of these assets is £100.6m (31 December 2014: £99.6m) reflecting our continuing policy of investing in and promoting housing schemes through the planning process over the long term.

We believe that the result of the General Election is likely to bring more stability and predictability to the UK economy. Mortgage lending and housing activity were reported to be marginally down immediately prior to the General Election but indications are that we are seeing a recovery in the housing market, post-General Election, which bodes well for the strategic land market.

In the post-General Election period we wait to see what changes, if any, the Government will impose on the planning regime. After the 2010 General Election the Government encouraged planning departments to release the pre-General Election shackles and allow more planning consents during the first three years of the coalition Government. Recent Government rhetoric would appear to support further increases in residential development. However, the position will become clearer over the next 12 to 18 months.

We have previously expressed our concerns about local authorities seeking to take too much value away from consented land to subsidise infrastructure provision. More contributions than ever are being sought by local communities, through Section 106 Agreements and Community Infrastructure Levies (CIL); particularly in the sphere of education, where greater contributions are demanded to pay for new education facilities and for affordable housing. These regulations are becoming ever more complex and punitive and are causing a number of sites, in lower value housing areas, to become unviable simply because of these levies. Whilst we fully recognise the need to make contributions to the general infrastructure burden, the Government must ensure that the requirements are not so disproportionate as to jeopardise the feasibility of schemes. This hidden tax also directly impacts on the housing industry and serves to increase housing costs at a time when many first time buyers find home acquisition unaffordable and will result in further under-supply of the new housing the country desperately needs.

Property investment and development

The appetite for well-let regional property investments remains strong and has led to an enhancement in values and we have therefore taken advantage of this by selling profitably a number of completed developments. Occupier demand, notably for offices and industrial space, continues to improve and has assisted in reducing void space, within our retained investments, to historically low levels as well as supporting an increasing amount of pre-let and design and build development activity.

In the first half of 2015, we completed the development of two industrial units at Markham Vale totalling 150,000 sq ft, pre-let to Inspirepac Ltd and Gould Alloys; terms have been agreed for the sale of both units with completion expected in the second half of the year. Reflecting the increased occupier demand at Markham Vale, our 200 acre Business Park located on Junction 29A of the M1 motorway, pre-let agreements have been exchanged with Great Bear Distribution Ltd on a 479,000 sq ft distribution unit and with Meter Provida Ltd for 40,000 sq ft of industrial accommodation. The Great Bear development is expected to commence late in 2015 and be completed midway through 2016. Forward funding and sale contracts for this £35m development are exchanged with M&G Real Estate Investments. The development of the 40,000 sq ft unit for Meter Provida Ltd is already well under way and is expected to be completed by the end of this year.

The speculative development of 130,000 sq ft of industrial space at Thorne, in joint venture with Royal Bank of Scotland, and supported by ERDF Grant funding, has progressed rapidly in the first half of the year with completion anticipated late in 2015 and terms have already been agreed for the sale or letting of circa 60,000 sq ft of the space.

We also developed 22,000 sq ft of office space at Westlakes Science Park in Cumbria, pre-let to Atkins Ltd, on programme and to budget and concluded the sale of the investment in June 2015. We have completed the 66 bed budget hotel in Malvern, pre-let to Premier Inn Hotels Limited, and an 18,000 sq ft retail warehouse unit, pre-let to Home Bargains in Bodmin, since the period end. The development of the 78 bed hotel in Richmond upon Thames, pre-let to Travelodge Hotels Ltd and pre-sold, is expected to be completed by the year end 2015, slightly behind programme, due to unforeseen ground conditions.

Good progress has been made with Aberdeen City Council on the development of the new 750,000 sq ft Aberdeen Exhibition and Conference Centre. Councillors gave their unanimous support for the terms of the development in March 2015 and we have since submitted an application for Planning Permission in Principle. A detailed planning application for the scheme is expected to be submitted during the second half of the year enabling the development of the scheme to commence in 2016.

Elsewhere, we have made good progress on the redevelopment of the listed former Terry's Chocolate factory in York. Contracts have been exchanged with a specialist residential developer, PJ Livesey, to undertake the conversion of the 170,000 sq ft factory building into 179 luxury apartments. Detailed planning and listed building consents have also been secured and development work is expected to commence in the autumn, with the first apartments ready for occupation by the middle of 2016. Furthermore, contracts have been exchanged, subject to the grant of planning permission, with specialist care home operator Springfield Healthcare Group Limited to purchase the former head office building on the site; and we anticipate that this sale will be completed in the second half of 2015.

A number of new development opportunities were secured in the first half of the year. These included exchanged development agreements for two 50 acre business parks in Luton and Southend-on-Sea. Additionally, pre-let and sale contracts have been exchanged with occupiers on two retail led development opportunities in Livingston, Scotland, and Belper, Derbyshire. Negotiations are progressing for a number of other significant pre-lettings or developments on which we are targeting contract exchange in the second half of 2015.

Stonebridge Projects completed 17 residential unit sales at an average selling price of £245k in the period and is on track to achieve in the region of 40 sales in the full year, in line with 2014. Planning delays around the General Election on three sites, including our former Leeds Girls' High School site, meant that we did not achieve permission on that site until early July 2015. It is, therefore, unlikely that we will secure sales from this 106 unit site in 2015. Our prime area of focus centres around the Leeds metropolitan area and we are now growing our land bank to over 300 units, largely on a subject to planning basis. As reported by major house builders, demand, pricing and margins are strong in the current marketplace.

Construction

After carrying a healthy order book into 2015, the division has already achieved its budgeted order book for this year and is on track to deliver targeted turnover and profit levels. We are starting to build an encouraging order book for 2016 in line with our expectations.

Our presence in the social housing sector continues with long-term frameworks for St Leger Homes in Doncaster, North Lincolnshire Homes in Scunthorpe, refurbishment of Hawksley bungalows for Chesterfield Borough Council, ASRA Housing Group, and with projects being delivered under the EN Procure framework.

We have recently secured a major scheme under the YORbuild framework for Leeds City Council. The £7.7m, 45 unit extra care housing facility is the first of its kind and part of a larger programme of development across the city. Work is due to commence shortly on a 20 bed accommodation unit in Sheffield for the St Wilfrid's homeless charity.

Construction work is progressing well on the £30m Fox Valley retail development in Stocksbridge for the Stocksbridge Regeneration Company Limited. This major project comprises several multi-unit retail blocks, commercial offices and associated civil engineering infrastructure to service the site. These works are on schedule for completion in early 2016.

We are into the fourth year of our six year framework with the Ministry of Justice Strategic Alliance Agreement for new build and refurbishment schemes for HM Prison Service, HM Court and Tribunals Service, National Probation Service and Forensic Science Service in the north of England. Having successfully completed four schemes earlier this year, we are currently delivering works on two further projects.

The education sector continues to provide good opportunities with the recent completion of the MERI Building Phases 2 & 3 for Sheffield Hallam University and ongoing works to an extension at the University of Sheffield Management School. The new construction centre at Chesterfield College is scheduled to open to new students in September this year.

In the health sector, opportunities continue under a framework agreement with the Sheffield Teaching Hospitals where we have delivered schemes at both the Northern General and Royal Hallamshire Hospitals. We are currently constructing the new helipad at Northern General Hospital which is due for completion in spring 2016.

An increase in activity in the commercial, industrial and leisure sectors has seen the successful completion of a food production facility for Ready Egg and more recently a 100,000 sq ft unit for Inspirepac at Markham Vale. The new visitor centre for Games Workshop in Nottingham was also successfully handed over earlier this year. We are currently on site at Capitol Park, Thorne, constructing several industrial units and refurbishing an existing unit on a mixed-use site. We are progressing works at Doncaster International Business Park, which comprises 22 individual ECO business units, for completion in 2015.

We have seen an increase in civil engineering opportunities through a supply-chain partnership on the 25 year Amey PFI Sheffield Highways scheme, where we continue to deliver a significant number of small civil engineering projects, largely on the road system structures throughout Sheffield. We have recently secured a place on the Amey Black and Veatch AMP6 framework with several projects in the pipeline. In addition, we are seeing good opportunities through the YORCivils framework including the remediation of the former Don Valley Stadium in Sheffield for mixed-use development.

The Group continues to retain a 61% stake in Road Link (A69), the PFI project to maintain the A69 trunk road between Newcastle and Carlisle. Road Link (A69), which has now completed 19 years of the 30-year contract with the Highways Agency, continues to trade in line with management's expectations.

Banner Plant has traded well in the period; carrying forward the trading momentum seen throughout 2014. All hire equipment categories have performed well and we have increased capital expenditure on the fleet items most in demand and producing the best returns. Turnover in the period was 12% ahead of the corresponding period last year, feeding through to improved earnings, and we foresee a solid result for the year. Improving construction markets are helping drive higher utilisation levels and better rates for the latest clean diesel engine units. We will open our fifth power tool centre at our Ossett plant depot during the second half of the year.

OUTLOOK

Land development

The planning system should now return to normal after the inevitable cautiousness of the pre-General Election period. Unfortunately, there is nothing normal about the planning system. It is far too susceptible to political whim at both local and national level. As a consequence, governments over a 30-year period have failed to fully grasp the unpopular nettle of ensuring that sufficient land is allocated for new housing, which has resulted in the current and universally acknowledged housing crisis.

Hallam Land's expertise lies in obtaining planning consents on predominately green field land. Despite the testing political conditions, we have secured planning on more than 12,000 plots and can look to future land sales with more confidence than at any other time in our history. Furthermore, at this time, we have more than 11,000 further plots within the planning pipeline and we remain confident of converting many of these into future permissions.

Property investment and development

The outlook for the commercial development segment is stronger now than at any time in the last six years. We have a very strong development pipeline and continually see interesting opportunities to evaluate and, if applicable, add to that pipeline. The strong market conditions seen in the south east of the country are increasingly being felt within the provinces, particularly within the major cities of the midlands and northern England. Retail development, especially food retail, remains more difficult than housing, industrial and office development, but there are some signs of improvements even in that sub sector. The next three years should see us deliver a significant increase in the scale and value of development activity, provided that market conditions remain in line with those we are seeing today.

Construction

Workloads are good and we are already building the 2016 order book. We have seen a reduction in public sector spend on construction, particularly in the run-up to the General Election; however, this was more than offset by the increase in private sector opportunities. We are very comfortable with the current marketplace though contract pricing remains competitive and we remain vigilant on some supply chain pricing pressures. Our plant hire business is trading well as is our PFI Project, Road Link (A69).

Overall, given the strength of the investment market, our construction order book and subject to the completion of certain key transactions during the second half of 2015 and notably around the year end, trading for the year ending 31 December 2015 is expected to be in line with our expectations.

GROUP RISKS AND UNCERTAINTIES

The Directors set out, in the 2014 Financial Statements (and reproduced in note 13), the key risks that could have a material effect on our results. The Board does not consider that these risks, which were identified at the time, have changed materially since then. The economic conditions across all our trading segments are good and our trading performance in these conditions gives great confidence for the year. We continue to have a strong portfolio of strategic land and development opportunities which are delivering profitability in line with appraisal forecasts. Improved investment and tenant demand continues to support the higher levels of commercial activity we are currently undertaking. We have also added a housing development land bank of over 300 units to be delivered over the next three to four years, accessing the high returns that are currently available on housing development. These development opportunities, combined with the strategic land sites with planning permission on over 12,000 units, and a further 11,000 units in the planning pipeline, are held as inventory and valued accordingly. Profit is taken as developments progress and land sales complete. Therefore, subject to consistency in the investment market, we continue to have the schemes at hand to deliver growing shareholder value, over both the short and long term, which remains our key objective.

John Brown

Chairman

28 August 2015

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)

for the half year ended 30 June 2015

CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED)

as at 30 June 2015

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

for the half year ended 30 June 2015

CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

for the half year ended 30 June 2015

NOTES TO THE CONDENSED FINANCIAL STATEMENTS

for the half year ended 30 June 2015

1. GENERAL INFORMATION

The Company is a public limited company, listed on the London Stock Exchange and incorporated and domiciled in the United Kingdom. The address of its registered office is Banner Cross Hall, Ecclesall Road South, Sheffield, United Kingdom, S11 9PD.

The financial information set out above does not comprise statutory accounts within the meaning of Section 434 of the Companies Act 2006 and is neither audited nor reviewed. The Financial Statements for the year ended 31 December 2014, which were prepared under IFRS as adopted by the European Union, have been reported on by the Group's auditors and delivered to the Registrar of Companies. The Independent Auditors' Report was unqualified and did not contain any statement under Section 498 of the Companies Act 2006.

2. Basis of preparation and accounting policies

The half-yearly financial information has been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and with IAS 34 'Interim Financial Reporting' as adopted by the European Union.

The Company meets its day-to-day working capital requirements through a secured loan facility, which includes an overdraft facility, which was renewed with effect from 17 February 2015, with a renewal date of 17 February 2018. The facility was increased from £50m to £60m at renewal. Subsequently, we extended facilities to £65m with the addition of a short term £5m overdraft. The current economic conditions create uncertainty for all businesses over a number of risk areas. As part of their regular going concern review, the Directors specifically address all the risk areas that they consider material to the assessment of going concern. The Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future and thus they continue to adopt the going concern basis of accounting in preparing the half-yearly financial information.

The preparation of half-yearly financial information requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expense. Actual results may differ from these estimates.

In preparing these half-yearly financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated Financial Statements for the year ended 31 December 2014.

The half-yearly financial information has been prepared using the same accounting policies and methods of computation as compared with the annual Financial Statements for the year ended 31 December 2014, except for as described below:

The following standards and interpretations are mandatory for the first time for the financial year ending 31 December 2015:

The adoption of these standards and interpretations has not had a significant impact on the Group.

The Group did not early adopt any new or amended standards and does not plan to early adopt any of the standards issued but not yet effective or mandatory.

3. Segment information

For the purpose of the Board making strategic decisions, the Group is currently organised into three operating segments: Property investment and development; Land development; and Construction. Group overheads are not a reportable segment; however, information about them is considered by the Board in conjunction with the reportable segments.

Operations are carried out entirely within the United Kingdom.

Inter-segment sales are charged at prevailing market prices.

The accounting policies of the reportable segments are the same as the Group's accounting policies as detailed above.

Segment profit represents the profit earned by each segment before tax and is consistent with the measure reported to the Group's Board for the purpose of resource allocation and assessment of segment performance.

4. Earnings per ordinary share

Earnings per ordinary share is calculated on the weighted average number of shares in issue. Diluted earnings per ordinary share is calculated on the weighted average number of shares in issue adjusted for the effects of any dilutive potential ordinary shares.

5. Dividends

An interim dividend amounting to £3,036,000 (2014: £2,750,000) will be paid on 23 October 2015 to shareholders whose names are on the register at the close of business on 25 September 2015. The proposed interim dividend has not been approved at the date of the Consolidated Statement of Financial Position and so has not been included as a liability in these Financial Statements.

6. Tax

Corporation tax is calculated at 20.25% (2014: 21.49%) of the estimated assessable profit for the period being management's estimate of the weighted average corporation tax rate for the period.

Deferred tax balances at the period end have been measured at 20% (June 2014: 21% and 20%), being the rate expected to be applicable at the date the actual tax will arise.

7. Investment properties

At 30 June 2015, the Group had entered into contractual commitments for the acquisition and repair of investment property amounting to £1,984,000 (31 December 2014: £11,167,000).

8. Borrowings

Movements in borrowings are analysed as follows:

Due to the uncertain timing of our forecast land and property sales during June the Group deemed it appropriate to apply for a short-term increase in our borrowing facility. On 9 June 2015 the Group's overdraft facility was increased by £5m for a period to 31 December 2015. The eventual timing of the Group's land and property transactions during June resulted in no requirement for this additional facility although it was drawn down to cover its potential requirement.

9. Provisions for liabilities and charges

Since 31 December 2014 the following movements on provisions for liabilities and charges have occurred:

10. Defined benefit pension scheme

The main financial assumptions used in the valuation of the liabilities of the scheme under IAS19 are:

Amounts recognised in the Consolidated Statement of Comprehensive Income in respect of the scheme are as follows:

The amount included in the Statement of Financial Position arising from the Group's obligations in respect of the scheme is as follows:

11. Related party transactions

There have been no material transactions with related parties during the period.

There have been no material changes to the related party arrangements as reported in note 29 to the Annual Report and Financial Statements for the year ended 31 December 2014.

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.

12. Cash generated from operations

13. Key risks

In common with all organisations, the Group faces risks which may affect its performance. These are general in nature and include: obtaining business on competitive terms, retaining key personnel, successful integration of new business streams and market competition.

The Group operates a system of internal control and risk management in order to provide assurance that it is managing risk whilst achieving our business objectives. No system can fully eliminate risk and therefore the understanding of operational risk is central to the management process within Henry Boot. The long-term success of the Group depends on the continual review, assessment and control of the key business risks it faces.

The Directors do not consider that the principal risks and uncertainties have changed since the publication of the Annual Report for the year ended 31 December 2014. To enable shareholders to appreciate what the business considers are the main operational risks, they are briefly outlined below:

Development

Land

Investments

Interest rates

Treasury

Planning

Personnel

Pension

Environmental

Economic

Counterparty

14. Approval

At the Board meeting on 27 August 2015 the Directors formally approved the issue of these statements.

RESPONSIBILITY STATEMENTS OF THE DIRECTORS

The Directors confirm that these condensed interim financial statements have been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union and that the interim management report includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8, namely:

The Directors of Henry Boot PLC are listed in the Henry Boot PLC Annual Report for the year ended 31 December 2014. A list of current Directors is maintained on the Henry Boot PLC Group website: www.henryboot.co.uk.

On behalf of the Board