DMGT Preliminary Results 2012/2013

DMGT delivers another year of growth

Preliminary Full Year Financial Highlights:

· DMGT underlying# revenue up 2%; underlying# operating profit* up 6%; margin up to 17%

· Adjusted profit* before tax of £282m, up 10%

· Good performance from B2B; underlying# revenue up 6% and underlying# profit* up 4%

· Resilient dmg media performance; underlying# revenue decline of 1%, with cost efficiencies driving underlying profit* growth of 10%

· Active portfolio management; targeted acquisitions and non-core asset disposals

· Good progress on the £100 million share buy back programme, £69 million to date

· Net debt reduced by £40 million to £573 million; net debt/EBITDA ratio of 1.5

· Earnings per share* up 7% to 53.0p

· Full year dividend increased by 7% to 19.2p

Martin Morgan, Chief Executive, said:

"DMGT has again delivered a good set of results. Group adjusted pre-tax profits* rose by 10% despite the disposal of Northcliffe Media at the end of the first quarter, reflecting good underlying profit growth from both our B2B and consumer operations. Our international B2B companies have increased their revenues and profits* by 6% and 4% respectively on an underlying# basis. Our UK consumer business, dmg media, grew its underlying# profits* by 10%, reflecting greater productivity as the business continues its digital transition.

We continued to refine and optimise our portfolio of businesses during the year with further strategic bolt-on acquisitions, notably within dmg information and Euromoney, and disposals, including Northcliffe Media and dmg media's central and eastern European consumer assets. We believe these changes have improved the overall quality and growth prospects of the Group and we look forward to another year of good progress."

A presentation of the Preliminary Results will be given to investors and analysts at 9.30am on 21 November 2013, at the London Stock Exchange, 10 Paternoster Square, London, EC4M 7LS. There will also be a live webcast available on our website, http://www.dmgt.com.

Next trading update

The Group's next scheduled announcement of financial information will be the first quarter interim management statement on 5 February 2014.

About DMGT

DMGT is an international business built on entrepreneurship and innovation. We bring together leading companies and talented people to provide businesses and consumers with high-quality analysis & insight, information, news and entertainment.

Notes

* Adjusted results are stated before exceptional items, other gains and losses, impairment of goodwill and intangible assets, and amortisation of intangible assets arising on business combinations. For a reconciliation of Group profit to adjusted Group profit, see Note 11. These adjusted results, including revenue and operating profit, are for total operations, including those treated as discontinued, namely Northcliffe Media and the dmg radio Australia joint venture. Northcliffe Media contributed operating profit of £7 million (2012: £26 million) from revenues of £49 million (2012: £213 million) and is included in the adjusted results. Excluding Northcliffe Media, revenues of £1,753 million are in line with £1,747 million last year, whilst operating profit of £293 million is 7% higher than last year's £274 million. A reconciliation of adjusted results including discontinued operations to adjusted results excluding discontinued operations is shown on page 21.

~ Percentages are calculated on actual numbers to one decimal place.

# Underlying revenue or profit* is revenue or profit* on a like-for-like basis, adjusted for constant exchange rates, disposals, closures, acquisitions and, with the exception of Euromoney, non-annual events occurring in the current and prior year; see pages 22 and 23. For dmg information the underlying results include the post-acquisition organic growth from acquisitions. For dmg events, the comparisons are between events held in the year and the same events held the previous time, and exclude Evanta, which was disposed of in September 2012. For Euromoney, underlying comparisons exclude current year acquisitions and underlying profit excludes the benefit in both FY 2012 and FY 2013 of the historic acceleration of its CAP incentive plan charge. For dmg media, underlying comparisons exclude low margin contract printing revenue, which ceased during the year, the effects of the sale of Teletext Holidays and motors.co.uk last year, the disposal of the central and eastern European businesses this year, and the merger of the Digital Property Group and Zoopla at the end of May 2012, and include the organic growth from Jobrapido. Northcliffe Media is excluded from the DMGT Group underlying comparisons.

† These statutory highlights are for continuing operations only (excluding the disposed of Northcliffe Media and dmg radio Australia joint venture), other than earnings per share which is the total statutory figure. In January 2013, the International Financial Reporting Standards Interpretations Committee (IFRIC) clarified the accounting treatment of contingent consideration contained within IFRS 3 "Business Combinations" and as a result prior year deferred consideration payments of £3.4 million have been re-stated as exceptional operating costs; see Note 2.

Daily Mail and General Trust plc

Northcliffe House, 2 Derry Street,

London, W8 5TT

www.dmgt.co.uk

Registered in England and Wales No. 184594

Management Report

This management report focuses principally on the adjusted results to give a more comparable indication of the Group's underlying business performance. All year-on-year comparisons are on a like-for-like basis. The reported results include Northcliffe Media until its disposal on 30 December 2012.

An explanation of restructuring and impairment charges and other items included in the statutory results is set out after the divisional performance review and in the segmental note (Note 4). The adjusted results are summarised below:

Amounts are stated rounded to the nearest million pounds, consequently totals may not equal the sum of the component integers.

Notes

* Adjusted results are stated before exceptional items, other gains and losses, impairment of goodwill and intangible assets, and amortisation of intangible assets arising on business combinations. For a reconciliation of Group profit to adjusted Group profit, see Note 11. These adjusted results, including revenue and operating profit, are for total operations, including those treated as discontinued, namely Northcliffe Media and the dmg radio Australia joint venture. Northcliffe Media contributed operating profit of £7 million (2012: £26 million) from revenues of £49 million (2012: £213 million) and is included in the adjusted results. Excluding Northcliffe Media, revenues of £1,753 million are in line with £1,747 million last year, whilst operating profit of £293 million is 7% higher than last year's £274 million. A reconciliation of adjusted results including discontinued operations to adjusted results excluding discontinued operations is shown on page 21.

# Underlying revenue or profit* is revenue or profit* on a like-for-like basis, adjusted for constant exchange rates, disposals, closures, acquisitions and, with the exception of Euromoney, non-annual events occurring in the current and prior year; see pages 22 and 23. For dmg information the underlying results include the post-acquisition organic growth from acquisitions. For dmg events, the comparisons are between events held in the year and the same events held the previous time, and exclude Evanta, which was disposed of in September 2012. For Euromoney, underlying comparisons exclude current year acquisitions and underlying profit excludes the benefit in both FY 2012 and FY 2013 of the historic acceleration of its CAP incentive plan charge. For dmg media, underlying comparisons exclude low margin contract printing revenue, which ceased during the year, the effects of the sale of Teletext Holidays and motors.co.uk last year, the disposal of the central and eastern European businesses this year, and the merger of the Digital Property Group and Zoopla at the end of May 2012, and include the organic growth from Jobrapido. Northcliffe Media is excluded from the DMGT Group underlying comparisons.

~ Percentages are calculated on actual numbers to one decimal place.

† In January 2013, the International Financial Reporting Standards Interpretations Committee (IFRIC) clarified the accounting treatment of contingent consideration contained within IFRS 3 "Business Combinations" and as a result prior year deferred consideration payments of £3.4 million have been re-stated as exceptional operating costs; see Note 2.

The average £: US$ exchange rate for the year was £1:$1.56 (2012 £1:$1.58). The rate at the year end was $1.62 (2012: $1.62).

All references to profit or margin in this management report are to adjusted profit or margin, except where reference is made to statutory profit.

Summary

Group performance: DMGT has delivered another good set of results. Group revenue for the year was £1,802 million, compared with £1,960 million for the prior year. The decrease of 8% on a reported basis was largely driven by the disposal of Northcliffe; on an underlying# basis, revenues increased by 2%. There was good underlying growth in several revenue categories, particularly subscriptions and digital advertising, with print advertising and circulation revenues declining as expected.

Revenue performance across our B2B businesses and our consumer business, dmg media, on a reported and underlying basis is summarised below.

Reported Group revenue includes Northcliffe Media.

Operating profit* of £300 million was in line with FY 2012, despite the disposal of Northcliffe at the end of the first quarter. Operating profit increased by 6% on an underlying# basis.

The Group's B2B companies' operating profits* were up 6% on a reported basis, an underlying increase of 4%. The operating profits* of dmg media were up 4% on a reported basis and up 10% on an underlying# basis. B2B businesses generated 77% of this year's operating profit* with 23% generated by consumer media, compared to 73% and 27% for the prior year. These percentages have all been calculated after allocating head office costs on the basis of revenues. Nearly two thirds of the Group's operating profits* were again derived from outside the UK.

Adjusted profit* before tax increased by 10% to £282 million. This reflected the changes in operating profit* described above, increased income from joint ventures and associates, notably Zoopla Property Group and Local World, and reduced net finance costs due to lower average net debt levels and the absence of a one-off £6 million early bond redemption charge incurred in the first half of the prior year. Adjusted Group profit* after tax and minority interests was up 6% to £200 million and adjusted earnings per share* rose by 7% to 53.0p. The full year dividend increased by 7% to 19.2p.

The statutory profit before tax, excluding discontinued operations, for the year was £203 million after £43 million of amortisation and impairment charges and £40 million of net exceptional charges. Statutory profit after tax was £213 million, down from £277 million†, reflecting the profits on disposal made in the prior year, and statutory earnings per share declined from 66.3p to 50.1p.

Net debt: fell by £40 million to £573 million due to continued strong cash flow generation. At the year end, most of the Group's debt remained in the form of long-term bonds, with a cash balance of £88 million. The Group's ratio of year end net debt to EBITDA was 1.5 times, well below the Group's preferred level of around 2.0 times and significantly below the requirements of the Group's bank covenants.

Active portfolio management: has continued throughout the year with acquisitions totalling £93 million and disposals totalling £88 million. The principal acquisitions during the year were strategic bolt-ons for dmg information and Euromoney.

Within dmg information, Environmental Data Resources (EDR) acquired FirstSearch, Genscape acquired Vessel Tracker and Hobsons acquired Beat the GMAT, Edumate and National Transcript Center.

Euromoney acquired Insider Publishing, TTI/Vanguard, the Centre for Investor Education and HSBC's Quantitative Techniques operation.

During the year, Northcliffe Media was sold to Local World, a newly formed entity in which the Group has acquired a 38.7% stake, and dmg media disposed of its central and eastern European print and digital consumer businesses.

Active portfolio management has continued in the new financial year and, in October 2013, dmg information acquired DIIG(E), the UK based property information business, for £75 million.

Outlook

Group: we have entered the new financial year with our businesses performing well and in line with our expectations. All our B2B businesses are expected to make good progress in the year ahead. On the consumer side, revenue progress will be largely dependent on the advertising environment, balanced against further growth in digital areas. First quarter consumer trading to date has been satisfactory but we remain cautious about the medium term outlook, given continuing external uncertainties, particularly for UK advertising. A continued focus on cost efficiencies should provide margin* stability.

RMS: has started the year with the core catastrophe modelling business performing well. There has been encouraging progress with the development of RMS(one), with 30 clients currently beta testing the new platform ahead of the launch scheduled for Spring 2014. The revenue of the existing core business is expected to grow by a mid-single digit percentage. In addition, RMS(one) is expected to deliver between £15 million and £25 million of revenues in FY 2014, with significant long-term growth potential. There will, however, be a significant step up in RMS's cost base as a result of product amortisation, investment in data centres and other costs associated with the launch and delivery of RMS(one). RMS as a whole is consequently expected to deliver good revenue growth but with a reduced margin* of around 25% in FY 2014.

dmg information: is expected to deliver underlying# revenue growth of between 10% and 15% as the portfolio of businesses continues to benefit from new product initiatives and strong customer demand. The Property, Education and Energy businesses will continue to be key drivers of overall growth and we expect operating margins* to be in the high teens.

dmg events: will benefit from all four of its largest events taking place in FY 2014, compared to three during FY 2013, with the increased frequency of the ADIPEC and Gastech events helping to enhance revenues. Reported and underlying revenue is expected to grow by between 10% and 15% and operating margins* are expected to be around 25%.

Euromoney: while sentiment in financial markets remains reasonably positive, there is usually a lag between improved profitability and the appetite of financial institutions to increase their spending on marketing, training and information buying. The outlook for events and training is more robust than for advertising, which is expected to have a weak first quarter, while subscription revenues should continue to grow.

dmg media: underlying# advertising revenues in the first seven weeks of the new financial year were up 1% on last year, with the absolute growth in digital advertising revenues more than offsetting the decline in print advertising revenues, although, as usual, there remains limited visibility on future trends. We expect our circulation revenues will continue to be impacted by declining volumes despite market share gains. Overall, dmg media expects to maintain stable underlying# revenues, underpinned by continued strong growth in the digital businesses. Operating margins are expected to be around 10%, with cost efficiencies helping to protect profitability.

Joint ventures and associates: will benefit from a full year of Local World, the continued growth of Zoopla, and the loss making Xceligent becoming a subsidiary of dmg information in October 2013. DMGT's share of pre-tax profits from joint ventures and associates is expected to be in excess of £30 million.

Net debt and capital allocation: the year end net debt:EBITDA ratio of 1.5 times is well below our preferred level of 2.0 times and the Board remains confident in the overall outlook for the Group and its operating cash flows. We believe that the creation of shareholder value over the long term requires a balanced approach to investing in growth and returning capital to shareholders while maintaining a strong balance sheet. We continue to look for attractive acquisitions and actively manage our business portfolio while maintaining our dividend policy. Subject to the share price, the Board has decided to complete the remaining £31 million of the £100 million share buy back programme announced in November 2012 although DMGT's M&A requirements will remain the priority for investment. The Board will review further share repurchase programmes on an on-going basis, in the context of its balanced approach to investing in growth and returning capital to shareholders.

Business Review

Business to business (B2B)

These results are stated after allocating Group corporate costs on the basis of B2B's share of Group revenues.

Revenues from the B2B group totalled £960 million, up 6% on the prior year on an underlying basis. Operating profits* were 6% higher at £232 million and were up 4% on an underlying basis, with increases from each division, most notably dmg information. Following the disposal of Northcliffe Media, a higher proportion of Group corporate costs are allocated to B2B group. This adversely impacted operating profit* and the overall B2B margin* remained at 24%.

Risk Management Solutions (RMS)

RMS delivered another year of growth, increasing its revenues by 7%, on a reported basis, and by 6% on an underlying basis, adjusting for constant exchange rates. Operating profit* rose by 1%, in line with the previous year on an underlying basis. The operating margin of 32% was lower than last year, reflecting the increase in operating costs ahead of the launch of the new platform, RMS(one), scheduled for Spring 2014.The majority of the underlying revenue increase came from the Natural Catastrophe and Underwriting Solutions businesses through contract renewal increases as a result of continuing strong demand.

The development of RMS(one) has progressed well and in line with expectations. The new platform offers clients a real-time, cloud based environment for managing their risk exposure and will represent a new core system within their operation. Clients will continue to subscribe to the existing models but clients will also pay for access to and usage of the RMS(one) environment. They will be able to access and run their own, RMS's and third party models, and also to integrate those models into enterprise-wide business processes. RMS(one) should enable clients to make better decisions as a result of real-time access and analytics, and has the potential to double RMS's addressable market over time.

Traction with existing clients is encouraging with thirty companies involved in beta testing RMS(one) to date. These are thirty existing RMS clients who are joint development partners or early access partners for RMS(one) and who represent approximately 50% of RMS's existing revenues from subscriptions to models.

Outlook

Revenues from the core business were £173 million in FY 2013 and the percentage growth in FY 2014 is expected to be in the mid-single digits. Revenues from RMS(one) have significant long-term potential but will take time to build, particularly given the usage based fee model in place. RMS(one) revenues are expected to be between £15 million and £25 million in FY 2014. As planned, the development of the RMS(one) platform has been a significant capital investment and there will be associated amortisation costs following the launch of RMS(one). The robust infrastructure underpinning the hybrid cloud environment must meet clients' expectations of security and data integrity standards and these new data centre costs will also be a significant operating expense for the business. The cost base associated with RMS(one) will therefore adversely impact RMS's profitability in FY 2014, with the overall profit margin expected to be approximately 25%.

dmg information

dmg information (dmgi) had another very good year, with underlying revenues up by 12%, 16% on a reported basis. The Property Information, Education and Energy businesses all delivered double digit underlying growth. Underlying operating profit increased by 14%, 21% on a reported basis, with growth being driven by the Property Information companies, partially offset by the planned investment in the Education and Energy businesses.

Property Information

Operating profit* is stated before charging central dmg information costs.

Our Property Information companies grew underlying revenues by 13%. In the US, EDR acquired FirstSearch, a provider of environmental contamination risk assessment products to the commercial real estate market, in December 2012. The integration of the business has progressed smoothly and the acquisition has enhanced EDR's product suite, provided opportunities to sell additional services to the two businesses' existing client bases and is delivering cost synergies. The US commercial real estate market continues to show signs of modest improvement.

In Europe, Landmark also delivered double digit underlying revenue growth and margin improvement. The German business, OnGeo, grew particularly strongly and contributed over a quarter of Landmark's revenues. Market conditions in the UK commercial real estate and housing markets were reasonable, though the volumes of UK housing transactions remain significantly below the levels experienced before the financial crisis.

BuildFax, a provider of planning consent and property information to the US insurance and financial services markets, remains a small, early stage business with good growth potential over the long-term.

Xceligent, one of only two companies in the US that provides fully researched property and listing information to the commercial real estate community, performed well. It is engaged in building out a national database of information. Xceligent was an associate during the year and so was excluded from dmgi's results. The stake in Xceligent was increased from an average of 49% during FY 2013 to 52% in October 2013. The business is therefore now a subsidiary and its losses will be included in dmgi's FY 2014 results.

In October 2013, dmgi acquired DIIG(E) for £75 million. This UK based business provides legal professionals, who conduct property transactions, with an electronic search service for residential and commercial property information and is complementary to dmgi's existing businesses in the property sphere. In the year to December 2012, DIIG(E) earned £6 million operating profit from £69 million of revenues.

Education, Energy and Financial

Operating profit* is stated before charging central dmg information costs.

Underlying revenues grew by 10%, with each of the three sectors (Education, Energy and Financial) contributing positively to the growth in the period.

Hobsons, serving the Education sector, continued its strong growth with underlying revenues increasing by 12%, driven by good performance both in the domestic US market and progressively in its international operations. Hobsons successfully completed three bolt-on acquisitions during the year: Beat the GMAT, the world's largest social network for MBA applicants; Edumate, an Australian provider of student management technologies for the schools market; and the National Transcript Center, the world's largest e-transcript exchange provider, serving more than 137,000 institutions representing over 14 million students. During the year, Hobsons invested in a new service, enabling universities to completely outsource the marketing, enrolment and student service management functions of their online programmes and this had a negative impact on Hobsons' margin.

Our Energy information company, Genscape, increased underlying revenues by 17% as a result of its expansion into the natural gas and biofuel markets and the development of new products which increased its addressable market. As expected, this growth strategy has required an increase in operating costs, which reduced operating margins for the year.

In April, Genscape acquired Vessel Tracker, a German based business which, by monitoring ship movements at ports and using satellite tracking, provides real-time tracking of around 100,000 vessels at any given time. The movements of maritime cargoes impact the trading prices of oil, gas and agricultural commodities and this acquisition enables Genscape to further develop its product suite for energy traders. In October and November 2013 Genscape acquired Energytics, a Texan provider of information services to energy traders, and invested in Petrotranz, a Canadian software as a service company that automates the planning and transfer of crude oil and natural gas liquids into pipeline networks.

The Financial information market continues to experience considerable change, as participants enter and exit the Commercial Mortgage-Backed Securities (CMBS) market served by Trepp and the broader Asset-Backed Securities (ABS) market served by Lewtan. In a challenging environment we are pleased that both Trepp and Lewtan were able to increase underlying revenues and profits.

Outlook

For FY 2014, dmgi expects to achieve underlying revenue growth of between 10% and 15% and will also benefit from the acquisition of DIIG(E) in October 2013. The operating margin* is expected to be in the high teens, adversely impacted by the inclusion of the loss making Xceligent business.

dmg events

dmg events had a very good year with underlying revenues increasing by 12% and underlying profits* by 14%. Reported revenues declined following the disposal of Evanta in September 2012. Two of the three biennial events, ADIPEC and Gastech, took place in the year compared to just one, the Global Petroleum Show, in FY 2012. Both events delivered strong performances.

Underlying revenue growth for the Middle East and Asia business, which includes the Big 5 construction events and ADIPEC, was 18% while the Global Energy business, which includes Gastech and the Global Petroleum Show, grew underlying revenues by 17%. The Digital Marketing business had a more challenging year and experienced a 5% decline in underlying revenues, reflecting the adverse impact of Superstorm Sandy on the New York ad:tech event. All three businesses are pursuing a strategy of launching geo-cloned versions of existing events in new geographies.

Outlook

The frequency of the historically biennial events is increasing with all three events occurring during FY 2014. ADIPEC and the Global Petroleum Show are moving to an annual cycle whilst Gastech is moving to an 18 month cycle. The increased frequency is expected to generate good incremental revenues overall, although it will have some adverse impact on the size of the individual events. Reported and underlying revenue growth is expected to be between 10% and 15% and the operating margin* relatively stable at approximately 25% in FY 2014.

Euromoney Institutional Investor

Euromoney released its preliminary results on 14 November. Revenue increased by 3% on a reported basis and by 1% on an underlying basis, after adjusting for acquisitions and exchange rates. Subscriptions, which accounted for 51% of revenue in the year, grew by 2% on an underlying basis. The Financial Publishing, Business Publishing, Conferences & Seminars and Research & Data businesses all delivered revenue growth in the year and only the smallest business, Training, experienced a revenue decline.

Operating profit* rose 6% to £119 million, including the cost of Euromoney's management incentive Capital Appreciation Plan (CAP). An additional accelerated charge in respect of the CAP was recognised in 2011, and both last year's and this year's profits benefit from the earlier acceleration of that charge. Excluding this benefit, and excluding acquisitions, underlying operating profit* is up 1% on last year. Costs, particularly headcount, have been tightly controlled, and Euromoney has continued to invest in technology and new products as part of its global online growth strategy.

During the year Euromoney acquired Insider Publishing, a leading information source and events provider for the international insurance and reinsurance markets, and TTI/Vanguard, the California-based private membership organisation for executives who lead technology innovation. It also acquired the Centre for Investor Education (CIE), Australia's leading provider of investment forums for senior executives of superannuation funds and asset management firms, and HSBC's Quantitative Techniques operation, giving Euromoney the opportunity to establish a significant footprint in the attractive index compilation market.

Outlook

The profitability of banks and asset managers improved during 2013, particularly in the US, although there is usually a lag between improved profitability and the appetite for financial institutions to increase their spending on marketing, training and information buying. Most customer budgets are calendar year driven so it is too early to determine whether this lag will translate into increased spend in 2014. The outlook for events and training is more robust than for advertising, while subscription revenues should continue to grow. Euromoney's strategy of investing in new products and technology and acquiring attractive bolt-on businesses, is expected to continue to drive further growth.

Consumer media

These results are stated after allocating Group corporate costs on the basis of Consumer media's share of Group revenues.

The reported results for the Consumer businesses were impacted by the disposal of Northcliffe Media, effective 30 December 2012. Following the disposal, the Group's remaining consumer media businesses sit within dmg media, formerly known as Associated Newspapers.

Operating profits* were favourably impacted by a lower proportion of Group corporate cost being allocated to the Consumer businesses, following the disposal of Northcliffe Media, and underlying operating profits were up 13%.

The Group owns stakes in Zoopla Property Group, the digital property business, and Local World, the local media publisher. DMGT's share of profits of these businesses is included within joint ventures and associates.

dmg media

These results are stated before the allocation of Group corporate costs. Amounts are stated rounded to the nearest million pounds, consequently totals may not equal the sum of the component integers.

Summary

Underlying revenues declined by 1% compared to the prior year, a good performance given the challenging trading environment. Reported revenues declined by 6%, due to the creation of the Zoopla Property Group in May 2012, which is now accounted for as a joint venture, the disposal of dmg media's central and eastern European operations during the first half of the year and the cessation of low margin contract printing activity.

There was a significant inflection point for the business in the first nine months of the financial year, with the underlying increase in digital advertising revenues across the dmg media portfolio∞ exceeding the ongoing decline in print advertising revenues. In the final quarter of the year, advertising comparisons were adversely impacted by the Olympics and Paralympics taking place during 2012, resulting in underlying advertising revenues for the full year being in line with last year. Circulation volumes continued to decline and underlying circulation revenues were down 3%.

Operating profit* for the year increased by 4% to £80 million. The underlying increase was 10% with lower costs, notably production and newsprint more than offsetting increased digital investment in MailOnline, Mail Plus, Metro and Wowcher, contributing to the increase in operating margin* from 9% to 10%.

The investment of £53 million in the purpose built printing plant at Thurrock, which is now fully operational, has resulted in one of the most efficient newspaper production facilities in the country, and completes the rationalisation from eight plants in 2008 to just two in 2013.

Mail Newspapers / MailOnline

Revenue for the combined newspapers and website businesses (Daily Mail, The Mail on Sunday and MailOnline) declined by 2% to £603 million due to a 8% decline in print advertising revenue and a 3% decline in circulation revenue. This was mitigated in part by revenue growth for MailOnline of 48%. The Daily Mail's circulation volumes continued to decline, partly due to reductions in high production cost foreign copies. The strength of the Mail brand, however, enabled a continued increase in the Daily Mail's market share to a record average of 22.0% for the year, despite the increase in the weekday cover price from 55p to 60p in February 2013.The Mail on Sunday's market share was 20.9%.

MailOnline continues to grow strongly, with 146 million monthly unique browsers and 9.5 million average daily unique browsers in September 2013, increases of 44% and 48% respectively on September 2012, reflecting higher levels of engagement with the site. MailOnline continues to focus on increasing the size and engagement level of its global audience and, in particular, is investing in its US editorial and sales presence.

Metro (including 7 Days)

Revenue at Metro declined 10% to £80 million, reflecting the benefit the Olympics had on last year's results. Metro remains the UK's third largest daily newspaper, read by 3.4 million people every weekday. The business continues to invest in its digital strategy and growing its digital audience.Metro's website attracted 17 million monthly unique browsers in September 2013, more than double September 2012, with 49% of its audience accessing via a mobile device. Digital advertising revenue increased by 44% compared to last year.

Evenbase

Evenbase, the international digital recruitment business, benefited from the acquisition of Jobrapido in April 2012 and delivered a revenue increase of 35% to £78 million. Underlying revenue growth was 11%, with strong organic growth from Jobrapido and Broadbean; international revenues now represent 39% of the total revenues.

Wowcher

Wowcher has grown rapidly since its launch in April 2011 and has grown its database to 3.7 million customers, notably affluent, urban women. Wowcher's net revenue nearly trebled from last year to £14 million.Wowcher remains in investment phase and operating losses were £10 million, an increase of £2 million on last year. The business is targeting to achieve a break-even run-rate by the end of FY 2014.

Other dmg media businesses

Reported revenues from other businesses were £60 million lower than last year. This was partly due to the merger of the Digital Property Group into Zoopla Property Group, which is reported as a joint venture, the disposals of the Teletext and Motors businesses taking place last year and the cessation of low margin contract printing activity. In addition, the central and eastern European publishing businesses only contributed revenues of £7 million in the year, compared to £28 million in the previous year. This was because they were disposed of in the year, increasing the focus of the dmg media portfolio on higher growth businesses.

Outlook

For FY 2014, dmg media expects to deliver stable underlying revenues, in the -2% to +2% range, with digital advertising growth across the portfolio offsetting circulation and print advertising declines. Operating margins are expected to be around 10% with cost efficiencies helping to protect profitability. Trading during the seven weeks since the year end has seen underlying advertising revenue growth of 1% and circulation revenues down 2%.

Northcliffe Media

Northcliffe Media was sold to Local World, a company in which the Group now owns a 38.7% stake, at the end of December 2012. Consequently the full year results only include three months' trading.

Joint Ventures & Associates

The Group's share of the results* of its joint ventures and associates increased by £9 million to £22 million. The share of Zoopla Property Group's operating profits* for the year was £15 million, compared to £4 million for the four months to September 2012. DMGT owns a 50.8% stake in Zoopla Property Group and the business continues to deliver encouraging growth and generate a high number of sales leads to its clients.

Local World delivered an encouraging performance for its first nine months of trading to September 2013, with DMGT's 38.7% share of operating profits being £11 million. Xceligent is still in its investment phase and DMGT's share of losses, from its average stake of 49% for the year, was £3 million.

Outlook

The FY 2014 share of operating profits form joint ventures and associates is expected to exceed £30 million and will benefit from the continued growth of Zoopla Property Group and the inclusion of a full year's trading at Local World. The stake in Xceligent increased to 52% in October 2013 and so its FY 2014 losses will be included as a subsidiary in dmg information's results.

Other income statement items

· Net finance costs

Amounts are stated rounded to the nearest million pounds, consequently totals may not equal the sum of the component integers.

Net finance costs decreased by £17 million to £40 million, partly due to last year's charge including a £6 million premium charge on the early redemption of bonds. There was also a £6 million increase in the pension finance credit to £15 million due to the reduction in the IAS19 pension fund deficit over the year to 30 September 2012.

Net interest payable and similar charges (including deemed finance charges and interest receivable) fell by 6% to £57 million, largely due to the repayment of bonds. Other investment income increased by £1 million, partly due to a dividend from the Press Association.

A revision to International Accounting Standard 19 - Employee Benefits [IAS19 (R)] will first apply to DMGT in its financial year ending 30 September 2014. This will not impact cash flows but will change the methodology for calculating the finance element of the net charge or credit associated with DMGT's defined benefit pension schemes. DMGT intends to exclude the pension finance income or expense from adjusted earnings as the calculation under the new standard will not necessarily reflect the underlying economics associated with the relevant pension assets and liabilities. If IAS19 (R) were to be applied retrospectively to the current financial year, the estimated expense would be £13 million, rather than the finance income of £15 million reported this year.

· Other items

The Group has charged £41 million as exceptional operating costs, of which £28 million were cash items. The cash items include £6 million in respect of earn-out costs for acquisitions, which historically would not have been recognised in the income statement but which now are recognised in it, following the clarification by the International Financial Reporting Standards Interpretations Committee in January 2013 in respect of the accounting treatment of contingent consideration, contained within IFRS3, "Business Combinations". The cash items also include reorganisation, redundancy and consultancy costs of £22 million, principally at dmg media.

Exceptional operating costs include accelerated depreciation and impairment of property, plant and equipment of £17 million, largely relating to the closure of the printing facilities in Stoke and Surrey Quays and the move to Thurrock. There was also a £4 million non-cash benefit within exceptional operating costs in respect of the curtailment of the Northcliffe defined benefit pension plan.

The charge for amortisation of intangible assets increased by £1 million to £40 million. The Group also made an impairment charge of £16 million, including £6 million relating to dmg information's remaining investment in Sanborn.

The Group recorded other net gains on disposal of businesses and investments of £58 million, compared to a net gain of £158 million last year. The gains primarily related to the disposals of Northcliffe Media and dmg media's central and eastern European businesses.

· Taxation

The adjusted tax charge of £52 million is stated after adjusting for the effect of exceptional items and was £13 million more than last year. The adjusted tax rate for the year rose to 18.4% from 15.2% in FY 2012, primarily due to an increasing level of profits in the US and other higher tax rate jurisdictions. The continued relatively low rate reflects tax reductions from tax-efficient financing and tax deductible amortisation in the US. Given the current mix of growing US based businesses and existing tax rates, the effective tax rate is expected to increase to around 22% over the next three years, as a greater proportion of profits will be subject to the high US tax rate.

There were net exceptional tax credits of £17 million (2012: £49 million) arising on disposals, assets held for sale, operating exceptional costs, the accelerated depreciation of fixed assets and the net recognition of tax losses.

Pensions

The Group's defined benefit pension schemes provide retirement benefits for existing and former UK staff, largely of dmg media and Northcliffe Media. The deficit in these schemes decreased from £324 million at the beginning of the year to £208 million at 30 September 2013 (calculated in accordance with IAS 19), with the increase in the value of assets exceeding the increase in the discounted value of the pension obligations. Additional funding payments into the main schemes during the year were £31 million, in accordance with a funding schedule agreed with the Trustees, including £17 million following the disposal of Northcliffe Media, for which a further £13 million will be paid into the schemes in January 2014. Since the end of the financial year, the Group has agreed, in principle, to a revised schedule of additional funding payments to the main schemes totalling approximately £30 million per annum to 2020 and £24 million per annum thereafter until 2026, or until the schemes' actuary agrees the schemes are no longer in deficit, if shorter. The defined benefit pension schemes are closed to new entrants. There has been no significant change in the allocation of the schemes' investments.

Net debt and cash flow

Net debt fell by £40 million during the year from £613 million to £573 million and by £151 million since the half year. The Group generated operating cash flows of £376 million, a 125% conversion rate of operating profits*. During the year, commercial and financial changes to the terms and collections of some of dmg media's newspapers' trade debtors resulted in an one-off reduction in working capital of approximately £60 million. Excluding this benefit, operating cash flows were approximately £315 million, a conversion rate of operating profits* of approximately 105%. Operating cash flows are stated after capital expenditure of £52 million, excluding £43 million of expenditure in respect of RMS(one) and Thurrock, and exceptional operating items of £22 million. These funded £69 million spent on the share buy back programme, taxation of £37 million, interest payments of £57 million, pension funding of £31 million and dividends totalling £79 million. Net expenditure on acquisitions, including proceeds from disposals, was £5 million.

The Group's principal debt remains in long-term bonds. During the year £47 million of 7.5% Bonds matured and were redeemed using available cash funds. At the year end, the Group had £674 million of Bonds with repayments due in 2018 (£309 million), 2021 (£169 million) and 2027 (£196 million). The Group had unutilised committed facilities of £300 million at the year end and surplus cash of £88 million.

The Group's ratio of year end net debt to adjusted profits* before interest, depreciation and amortisation (EBITDA) was 1.5 times, comfortably below the Group's preferred level of around 2.0 times, and well within the requirements of the Group's bank covenants. The Group's corporate credit ratings are BBB- from Fitch, and BB+ from Standard & Poor's.

The Directors consider that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing its accounts.

Capital allocation and share buy back

The Board continues to believe that the creation of shareholder value over the long term requires a balanced approach to investing in growth and returning capital to shareholders while maintaining a strong balance sheet. We continue to look for attractive acquisitions and actively manage our business portfolio while maintaining our policy of dividend growth, in real terms. Subject to the share price, the Board has decided to complete the remaining £31 million of the £100 million share buy back programme announced in November 2012 although DMGT's M&A requirements will remain the priority for investment. The Board will review further share repurchase programmes on an on-going basis, in the context of its balanced approach to investing in growth and returning capital to shareholders.

Financing

During the year, the Group acquired 10.4 million 'A' Ordinary Shares for £69 million under a share buy back programme. The Group acquired a further 4.7 million 'A' Ordinary Shares for £31 million in order to meet obligations to provide shares under its incentive plans and utilised 4.8 million shares out of Treasury, valued at £27 million, to provide shares under various incentive plans. As at 15 November 2013 DMGT had 373.2 million shares in issue, including 19.9 million Ordinary Shares, and a further 20.4 million 'A' Ordinary Shares held in Treasury.

During the year, DMGT acquired 1.2 million Euromoney shares at a cost of £11 million. This action was taken in order to offset the dilutive effect of the vesting of Euromoney's CAP.

Dividend

The Board is recommending payment on DMGT's issued Ordinary Shares and 'A' Ordinary Shares of a final dividend of 13.3 pence per share for the year ended 30 September 2013 (2012 12.4 pence). This will make a total for the year of 19.2 pence (2012 18.0 pence per share). The final dividend will be paid on 7 February 2014 to shareholders on the register at the close of business on 29 November 2013.

Ordinary Shares

On 29 October 2013, the Court Approved Scheme of Arrangement was filed at Companies House and therefore was effective from that date. As a result, Rothermere Continuation Limited (RCL) has acquired the remaining Ordinary Shares not previously held and is now the registered holder of all of DMGT's 19.9 million Ordinary Shares. The DMGT Ordinary Shares were cancelled from listing on the London Stock Exchange on 30 October 2013. The status of the 'A' Ordinary Shares is not impacted.

Reconciliation: Adjusted results including and excluding discontinued operations

Underlying analysis - Revenues

Notes: M&A adjustments are for disposals, including Evanta, Teletext Holidays and dmg media's central and eastern European operations; the merger of The Digital Property Group to form the Zoopla Property Group; and acquisitions, including Jobrapido, FirstSearch and Insider Publishing. Acquisitions are excluded from Euromoney's underlying results whereas dmg information and dmg media's underlying growth rates include the post-acquisition organic growth from acquired entities.

Amounts are stated rounded to the nearest million pounds, consequently totals may not equal the sum of the component integers.

Underlying analysis - Adjusted operating profit*

Notes: B2B and Consumer underlying figures are stated pre the allocation of Corporate costs. Including Corporate costs, the underlying growth rates for B2B and Consumer were +4% and +13% respectively. 'Other' includes adjustments for the timing of events, the acceleration of Euromoney's CAP costs, the premium on the redemption of bonds and the pension finance credit.

Amounts are stated rounded to the nearest million pounds, consequently totals may not equal the sum of the component integers.

Principal risks and uncertainties

Risk is a part of doing business, but understanding the risks and, just as importantly, the opportunities that impact DMGT businesses is vital. Effective risk and opportunity management saves time and money, and gives assurance to management, the DMGT executive team, Risk Committee and the Board.

The Group's risks are categorised as either strategic or operational. Strategic risks are linked to the Group's strategic priorities and impact the whole Group. Operational risks are those arising from the execution of the business functions and typically impact on one or more of the operating businesses.

Strategic Risks

Operational risks

Statement of Directors' responsibilities

The Directors are responsible for preparing the full year financial report, in accordance with applicable law and regulations.

The Directors confirm that to the best of their knowledge:

a) the financial statements, prepared in accordance with International Financial Reporting Standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole; and

b) the management report includes a fair review of the information required by the Financial Services Authority's Disclosure and Transparency Rules 4.2.7R and 4.2.8R.

By order of the Board of Directors

The Viscount Rothermere

Chairman

20 November 2013

Analysts' presentation and webcast

A presentation of the Preliminary Results will be given to investors and analysts at 9.30am on 21 November 2013 at the London Stock Exchange, 10 Paternoster Square, London, EC4M 7LS. There will also be a live webcast available on our website: http://www.dmgt.com.

Next trading update

The Group's next scheduled announcement of financial information will be its first quarter interim management statement on 5 February 2014.

* Adjusted results are stated before exceptional items, other gains and losses, impairment of goodwill and intangible assets, and amortisation of intangible assets arising on business combinations. For a reconciliation of Group profit to adjusted Group profit, see Note 11. These adjusted results, including revenue and operating profit, are for total operations, including those treated as discontinued, namely Northcliffe Media and the dmg radio Australia joint venture. Northcliffe Media contributed operating profit of £7 million (2012: £26 million) from revenues of £49 million (2012: £213 million) and is included in the adjusted results. Excluding Northcliffe Media, revenues of £1,753 million are in line with £1,747 million last year, whilst operating profit of £293 million is 7% higher than last year's £274 million. A reconciliation of adjusted results including discontinued operations to adjusted results excluding discontinued operations is shown on page 21.

# Underlying revenue or profit* is revenue or profit* on a like-for-like basis, adjusted for constant exchange rates, disposals, closures, acquisitions and, with the exception of Euromoney, non-annual events occurring in the current and prior year; see pages 22 and 23. For dmg information the underlying results include the post-acquisition organic growth from acquisitions. For dmg events, the comparisons are between events held in the year and the same events held the previous time, and exclude Evanta, which was disposed of in September 2012. For Euromoney, underlying comparisons exclude current year acquisitions and underlying profit excludes the benefit in both FY 2012 and FY 2013 of the historic acceleration of its CAP incentive plan charge. For dmg media, underlying comparisons exclude low margin contract printing revenue, which ceased during the year, the effects of the sale of Teletext Holidays and motors.co.uk last year, the disposal of the central and eastern European businesses this year, and the merger of the Digital Property Group and Zoopla at the end of May 2012, and include the organic growth from Jobrapido. Northcliffe Media is excluded from the DMGT Group underlying comparisons.

~ Percentages are calculated on actual numbers to one decimal place.

† In January 2013, the International Financial Reporting Standards Interpretations Committee (IFRIC) clarified the accounting treatment of contingent consideration contained within IFRS 3 "Business Combinations" and as a result prior year deferred consideration payments of £3.4 million have been re-stated as exceptional operating costs; see Note 2.

∞ Underlying print advertising includes revenue from the Daily Mail, The Mail on Sunday and Metro, while underlying digital advertising includes revenue from MailOnline, Evenbase (excluding Broadbean and including the year-on-year organic growth from Jobrapido), Wowcher, Metro's digital assets, Villarenters and other smaller revenue streams. Zoopla Property Group is a joint venture and consequently its revenues are excluded from dmg media's revenues.

The average £: US$ exchange rate for the year was £1:$1.56 (2012 £1:$1.58). The rate at the year end was $1.62 (2012: $1.62).

All references to profit or margin in this management report are to adjusted profit or margin, except where reference is made to statutory profit.

Certain statements in this announcement are forward looking statements. By their nature, forward looking statements involve a number of risks, uncertainties or assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward looking statements. These risks, uncertainties or assumptions could adversely affect the outcome and financial effects of the plans and events described herein. Forward looking statements contained in this announcement regarding past trends or activities should not be taken as representation that such trends or activities will continue in the future. You should not place undue reliance on forward looking statements, which apply only as of the date of this announcement. This announcement does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase any shares in the Company, nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or commitment or investment decisions relating thereto, nor does it constitute a recommendation regarding the shares of the Company. Past performance cannot be relied upon as a guide to future performance.