Final Results 2008

27th Feb 2009 07:00

Rightmove plc33 Soho SquareLondonW1D 3QU EMBARGOED UNTIL 7AM 27 FEBRUARY 2009 RIGHTMOVE plc 2008 FULL YEAR RESULTS

Rightmove plc, the UK's number one property website, today announces its Full Year results for the year ended 31 December 2008.

Highlights:

* Revenue grew 31% from £56.7m to £74.0m * Underlying operating profit* increased 33% from £30.7m to £41.0m* * Underlying EPS up 27% to 23.8p (2007: 18.7p)

* Restructure completed which will provide an estimated £5m savings in 2009

* Success of Rightmove Choice - more than 30% of customers now use one or

more Rightmove Choice products with over 11,000 products currently in use

* Average revenue per advertiser rose 26% to £307 per month at the end of

2008 (2007: £243)** * 11.9m shares bought back at a total cost of £45m * Net debt of £16.9m (2007: net cash of £11.8m)

* Proposed final dividend of 7.0p, making a total dividend of 10.0p for the

year (2007: 8.0p), up 25%***

Ed Williams, Managing Director, said:

"These are tough times in the property market. It is becoming clearer and clearer that those serious about selling are doing more and more on Rightmove."

For more information please contact:

Rightmove Ed Williams and Nick McKittrick 020 7087 0605

* Before share-based payments, NI on share options under issue and capital reconstruction costs.

** Calculated as an average of period end ARPA over 12 months.

*** For the year.

A PDF copy of the 2008 Full Year results can be downloaded from www.rightmove .co.uk/investors.rsp

This Annual Report contains forward looking statements. These forward lookingstatements are not guarantees of future performance. Rather they are based oncurrent views and assumptions and involve known and unknown risks,uncertainties and other factors that may cause actual results to differ fromany future results or dev

elopments expressed or implied from the forward looking statements. Each forward looking statement speaks only as of the date of the particular statement.

Chairman's statement

It is my pleasure to present Rightmove plc's financial results for the year ended 31 December 2008.

2008 was another year of growth for Rightmove despite difficult economicconditions and the worst UK housing market in modern history. With new buildstarts at an 85 year low in 2008, record low home sales resulting in 2,500 to3,000 estate agency office closures and widespread job losses, 2008 has been achallenging marketplace. Nevertheless, a combination of clear online marketleadership, management dedicated to providing continuously improved customervalue and a strong financial position has enabled Rightmove to continue toperform and deliver for customers and home hunters.

Financial Results

General property advertising spend will prove to have fallen dramaticallyduring 2008. However, the compelling benefits of internet advertising and thecontinued migration of people online have allowed us to deliver anotheroutstanding set of results with revenue, profits and earnings per share allincreasing year on year. Revenue increased by 31% to £74.0m (2007: £56.7m).Operating margins of 55.4% (2007: 54.2%) resulted in underlying operatingprofit* up 33% to £41.0m (2007: £30.7m).At the beginning of 2008, we completed a Scheme of Arrangement to establish anew holding company creating significant distributable reserves to allow returnof surplus capital to shareholders for many years to come.In April 2008, Rightmove entered into a revolving loan facility of up to £40mwith the Bank of Scotland for the specific purpose of facilitating share buybacks. Following the repurchase of 11.9m shares at a cost of £45m, which wasfunded in part by operating cash flow, the Group's net debt position as at 31December 2008 is £16.9m. Under the terms of the loan agreement there arecommitted bank funds for the conversion of the loan facility into a term loanat maturity in April 2009. In February 2009 the Board agreed to term out aminimum of £25m at maturity.The Board announced a 3.0p (2007: 2.0p) per ordinary share interim dividendwhich was paid on 10 October 2008. The Board proposes to pay a final dividendof 7.0p per ordinary share which gives a total dividend for the year of 10.0p(2007: 8.0p) an increase of 25% year on year. The final dividend, subject toshareholder approval, will be paid on 12 June 2009 to members on the registeron 15 May 2009.Management and employees

The success of the Group owes much to the commitment, strength and passion ofall our employees. Nevertheless, 2008 was a difficult year for our staff. Oursubstantial market penetration led us to convert our sales organisation into amore relationship management structure. Simultaneously, the Group undertook aprogramme of job reductions that are reflective of the current economicenvironment. Accordingly, we announced a 23% reduction in staff in November2008. I would like to thank our former and current employees for theirdedication, performance and the way in which they conducted themselves duringthis difficult time.The Board of directorsAs previously announced in October 2008, Nigel Cooper has completed his term asa non-executive director and will not seek re-election at the 2009 AnnualGeneral Meeting. I would like to thank Nigel for his wise counsel as chair ofthe Audit Committee during our first three years as a public company and forhis support in recruiting his successor.As part of the organisation restructure, in early January 2009, we announcedthe merger of the finance and other head office functions with Rightmove's mainproperty advertising business under the leadership of Nick McKittrick whoassumes the role of Chief Operating Officer and Finance Director. As a resultGraham Zacharias, who joined the business in 2006, prior to the IPO, will standdown as Group Finance Director in the spring of 2009 and will not stand forre-election to the Board at the 2009 Annual General Meeting. I would like tothank Graham for building a strong finance team and systems and generally forhis major contribution to transforming Rightmove from a private to a publiccompany.

Annual General Meeting and resolutions

The majority of the resolutions being proposed at the Annual General Meetingare general in nature, a summary of which is described in the Directors' Reportand in the Notice of Annual General Meeting which will be sent to shareholdersin March 2009. I hope that shareholders will approve these resolutions and Iand the rest of the Board look forward to answering any questions and updatingshareholders further on the development of the business at our Annual GeneralMeeting which will take place at 10am on 6 May 2009 at the offices of UBSLimited at 1 Finsbury Avenue, London, EC2M 2PP.

On behalf of shareholders, I would like to thank Ed Williams and his entire team for the achievements of the past year. My thanks also go to the Board for their guidance during challenging economic times.

Scott ForbesChairmanNotes:

* Before share-based payments, NI on share options under issue and capital reconstruction costs.

BUSINESS AND FINANCIAL REVIEW

In 2008, Rightmove extended its leadership position in online propertyadvertising. With the property industry focused on the need for buyers, ourability to deliver enquiries at levels comparable to 2007 has allowed us to befar more resilient than traditional print advertising. The overall costeffectiveness of our service, together with products which allow our customersto target specific potential home buyers with offers and price reductions,contributed to revenue growth.Despite the strength of our 2008 performance, the housing market downturn andthe credit crunch has been and will continue to be too pronounced to insulateRightmove. However, we believe the underlying strength of the business, and ourability to invest in marketing and product development in the tough times, willreward us with a substantial share of the industry's marketing spend as thehousing market starts to return towards more normal levels of activity.As we start 2009, our objective is to communicate unequivocally to home huntersthat we remain the place to look for property and to the property industry thatwe are the place to advertise. Though optimism is challenging amidst the gloomyeconomic news, we are confident of maintaining cash flow at or ahead of 2007levels and have the enormous benefit of a strong financial position.

Our 2008 results are the strongest possible evidence of our belief that Rightmove will be the biggest beneficiary of the structural shift of advertising spend from traditional media to online.

We wish to thank all our customers for their loyalty at a time when thedramatic fall in number of housing transactions has led them to reduce stafflevels and their other marketing spend to an extent not witnessed in livingmemory. We also wish to express our thanks to the many former Rightmoveemployees who made such a big contribution to the growth of our business butwho also lost their jobs as a result of the collapse of the UK property market.Our 2008 results2008 was a record year for Rightmove. Revenue increased by 31% to £74.0m (2007:£56.7m) and underlying operating profit* increased by 33% to £41.0m (2007: £30.7m).

* Before share-based payments, NI on share options under issue and capital reconstruction costs.

Although the second half of the year was tougher than the first, both revenueand profits in the second half of the year were only slightly lower than in thefirst half and were substantially ahead of the second half of 2007.Our results also reflect £0.7m of costs in relation to the headcount reductionof 78 employees (23% of the workforce), which will provide an estimated £5m ofsavings in 2009.

The UK property and property advertising sector

In the context of the 2008 housing market, these results bring into focus the key advertising industry question:

To what extent is the downturn in classified newspaper advertising cyclical or structural?

Regional newspaper group results in recent trading and reporting periods havepointed to greater than 50% reductions in property advertising revenue comparedto the same periods a year earlier.We believe that around 20% of estate agent offices have left the industry sincethe start of the downturn in July 2008. In many, though by no means all cases,these were smaller businesses that always spent less on advertising. Thereforethe majority of the overall decline in property advertising spend has come froma reduction in newspaper spending by agents who continue to trade and not as aresult of agents leaving the industry.This scale of decline reflects the realities of the current trading environmentfor estate agents and new homes developers. We estimate, based on conversationswith estate agents, that the total number of housing transactions in 2008 wasaround half the level seen in more normal market conditions and even furtherdown on the peak level of activity. Given that the start to 2008 was far betterthan the end, the current run rate may well be around a third of that in anormal market.The overall decline in the number of agents, coupled with a sharp reduction inhouse building across the UK in 2008, has inevitably resulted in shrinkage inour advertiser base. This had an impact on revenue in the second half of 2008and will inevitably impact 2009 as we experience the full-year financialconsequence of the disappearance of these advertisers.Nonetheless, during 2008 we gained more than 2,200 individual estate agent andletting agent offices, with lettings representing an area of particularly rapidgrowth. Setting aside the substantial contraction in the overall base of agentsin the market, the gains in agents farout-weighed the loss of agents who remain in business.At the time of writing we have 24 of the top 25 new homes developersadvertising with us. We have witnessed a decline in the total number of newhomes developments being marketed across the country. One impact of extremelytough trading conditions facing developers has been both a marked increase intheir willingness to spend on all Rightmove's online services during thosemonths that they see as key sales months, coupled with decisions to stopadvertising through most or all media in other months such as December.

What we do and the keys to success

Rightmove's success in 2008 in adverse conditions arises directly from what it is we do and how that differs from others.

The most effective property advertising medium

By using the Rightmove.co.uk website our advertisers reach by far the largestaudience of prospective home movers in the country and in turn home movers seemore properties than anywhere else. During a period of decline in circulationfor local and regional newspapers, activity on the Rightmove website continuedto increase, with page impressions up by 8% to 5.3bn (2007: 4.9bn). Accordingto Hitwise, which monitors over a thousand property-related websites, Rightmovehas started 2009 with as many pages of information being viewed as all otherproperty websites put together.Rightmove generates enquiries from prospective home buyers whether via phone,email or by other means that we cannot directly track. In the current tradingenvironment buyer enquiries are the life-blood of agents and propertydevelopers.

The key performance indicators that we monitor are:

Page impressions Email enquiries Properties displayed +400m Down 6% +4.5% Number of page Number of emails down Number of properties impressions in the year by far less than the displayed on grew from 4.9bn (2007) decline in number of Rightmove.co.uk at 31 to 5.3bn (2008), up 8% agents and developers December 2008 was 1,085,000 (2007: 1,038,000)

Rightmove's ability to out-perform newspapers in these challenging times reflects:

* our increasing audience - at a time when newspapers are declining;

* the need for enquiries from home buyers - as opposed to the overwhelming

focus on winning the right to sell a house during the good times;

* measurability - with all our customers seeking to reduce costs and yet make

sales, measurability has been thrust to the fore;

* the belated recognition that what sellers of homes expect from their agent

is that they market their property in the places that they themselves look

- increasingly now the internet as opposed to the local paper as

circulation declines and online users come of age.

Long-term sustained investment

The high level of site activity and enquiries is the result of our historic cash investment and the effort put into the development of the Rightmove.co.uk website and the marketing of it. 2008 has seen that investment sustained.

We have extended our range of Rightmove Choice products and widened their availability. Now our lettings advertisers and overseas homes advertisers can benefit from the increased response and branding our Choice products offer.

The site has also been redesigned to make it more visible to Googleâ„¢ andthereby to increase our organic rankings across a range of search terms. Thisinvestment is already paying dividends and should continue to strengthen ourpresence.Our "See More" media campaign represents our biggest investment ever inmarketing. Indeed it may well represent the biggest marketing investment into asingle campaign made by any property-related advertiser. The campaign launchedon Boxing Day with heavy-weight TV advertising across Britain running throughto the start of February. This has been accompanied by outdoors advertising inhigh profile city centre sites, advertising on video panels on Londonunderground and extensive online advertising.A consequence of this is that, the Rightmove.co.uk website has generated recordnumbers of enquiries in January 2009. Enquiry levels have doubled in comparisonto a year ago peaking at 44,250 email enquiries in a single day, equating toone email enquiry every two seconds. Our share of the home moving audienceonline has also increased dramatically with, on many days in January, moreactivity on the Rightmove website than on all the other 1,200 or so propertywebsites put together (property websites monitored by Hitwise).We believe that the current state of the housing market gives us an opportunityto use our financial resources to demonstrate to the home moving public and theproperty industry alike Rightmove's pivotal role and reinforce our marketleading position.

Service and infrastructure

We have maintained the size of our customer service teams. As the burdensplaced on us by the rapid growth in membership numbers eased we have been ableto devote more time to talking with our customers and working with them at anindividual level to improve the quality of their advertising with us (and henceits effectiveness).In preparation for 2009 we have reshaped our sales force into a more focusedteam of relationship managers able to work with our customers to maximise thevalue they get from Rightmove and offer them wider advice on marketingeffectiveness. This is supported with a programme of local seminars.Our online reports and tools give our customers effective ways to target alltheir marketing activity. This has been demonstrated by the rapid growth of ouremail campaign service to new homes developers, allowing them to target peoplewho have already registered an interest with us regarding the price, type andlocation of property.We have also taken the opportunity in 2008 to replace the majority of our ITplatforms and hardware systems. The whole of the technology platform whichpowers our Rightmove.co.uk website, from very technical layers, the database,through to the business logic which handles the way in which users search forproperties has been upgraded. Following on from the redesign of theRightmove.co.uk interface which was launched in December 2007, there is hardlyany part of the technology that the public see and use which dates back tobefore then. A less obvious, large investment has been in a completereplacement of our billing systems which have needed to handle increasingvolumes and sophistication of product and pricing options.

Focus

We believe that the focus we have had on the core UK online propertyadvertising market has been a vital ingredient of our success. Any investmentsor acquisitions which we might have made that would have extended the scope ofour business into areas which are directly coupled to the level of housingactivity would have been far more adversely affected by the events of the lastyear.During 2008 we took the decision to stop selling general banner advertisingaround our AboutMyPlace mapping website. The volume of web pages available toadvertisers continues to grow while generic online display advertising spenddeclines. Our own experience only serves to confirm the challenges faced by anyproperty website based on a free-to-list model with revenue derived from otheradvertising.

We continue with two business areas that are not part of our core Rightmove.co.uk website business: Holiday Lettings Limited and our Automated Valuation business.

Holiday Lettings, which we acquired early in 2007 has grown rapidly and aheadof expectations, albeit that this is not reflected in the like-for-likestatutory results due to the way in which the revenue recognition policy wasapplied. With the UK public seeking to economise on luxuries we believe theholiday rentals market will prove one of the most resilient aspects of thetravel industry. An increased focus since 2007 on UK properties should providesome protection against the consequences of a weaker pound sterling. Meanwhile,ownership of a holiday home is no longer a one-way ticket to appreciating assetvalues, making the need for securing high occupancy rates by owners that muchgreater.Our Automated Valuation business has faced a market where the number ofvaluations carried out for mortgage lending purposes fell dramatically.However, we had started the year from a very low base so this did not lead to adecline in business. Concerns about asset quality and risk have led to thegrowth of the use of automated valuations to revalue properties for a varietyof other applications. During the year we have been working with 4 out of thetop 6 mortgage lenders. We have also been selected by Experian as theirstrategic partner, offering further evidence of the superiority of theRightmove AVM product and technology. These relationships should prove valuableas transaction volumes recover.Focus does not preclude innovation. Earlier in 2008 Rightmove introduced itsfirst Local Edition, a down-loadable magazine format, weekly online propertypaper. Over the course of the year we have increased the number of LocalEditions to nine and intend to extend this over time. The Local Edition givesestate agents and house builders the opportunity to follow tried and trustedadvertising formats, including display advertising, but for the publication tobe produced ahead of the weekly newspaper and delivered to thousands ofsubscribers at virtually no cost.

A tough market does not preclude areas of growth in customers. In addition to the increase in number of lettings agents on Rightmove, we now have relationships with far more Housing Associations than a year ago.

The completion of our major IT investment in replacing our underlyingtechnology will free up more time in 2009 for visible and commercially focusedproduct development. Indeed one of the key benefits of the investment we havemade in the infrastructure is to speed up development time for new products,benefits we are already seeing in our current projects.

Protecting shareholder value

How the Board monitors performance

Our Board reviews performance at Board meetings and on a monthly basis througha detailed monthly management report, which covers all the key performanceindicators featured in this report. The primary method by which risks aremonitored and managed is by the monthly Executive Board, which reports to themain Board on such matters bi-annually or as the business requires. With theassistance of the Audit Committee, the Board reviews the effectiveness ofinternal controls at least annually.

Uncertainties, threats and risks

Thus far the Rightmove business model has proved remarkably resilient in theface of an unprecedented down-turn affecting the customers we serve.Nonetheless the business is inevitably exposed to the general uncertainty ofthe housing market and particularly to transaction volumes.Rightmove, from its inception, has experienced a large number of new entrantsin terms of property websites, often exhibiting a range of business models andfrequently involving the offer of free advertising to agents. The new entrantswho attracted the most attention over the last two years have failed to makeany actual material impact in spite of big claims at the start. We cannot ruleout the appearance of a completely new entrant or business model. However, webelieve that the tougher market conditions reinforce the view that thelong-standing competitor property portals, all owned by larger media groups,represent the most tangible source of competition.Looking further ahead, Rightmove's success as the preferred alternative tolocal newspapers as property advertising spend recovers will depend on ourability to develop and commercialize an appropriate range of products andservices. These may be enhanced advertising products on the Rightmove.co.uk website, other online advertising services (such as our Local Edition) or theextension of our services from pure advertising into other aspects of marketing(such as our email campaigns for new homes developers).We believe there are limited risks relating to operational failures, tofinancial and legal exposures, to fraud or embezzlement or from onerouscommercial obligations or liabilities. The business has few tangible assets andthe major intellectual assets are tied up in the design of our website and inour brand identity, recognition and reputation.

Financial position

Margin growth

The underlying operating margin for the year increased from 54.2% to 55.4% as aconsequence of strong revenue growth and a more modest increase in overhead. Year ended Year ended Year ended 31 December 2008 31 December 2007 31 December 2006 Underlying 55.4% 54.2% 52.1%operating margin %* * Based upon operating profit before share-based payments, National Insurance(NI) on share options under issue, capital reconstruction costs and flotationcosts.Bad debtDuring the year a bad debt charge of £1.4m was incurred (2007: £0.3m). Thelargest single amount written off in respect of any one customer was £44,000 inrespect of an estate agency group. The bulk of the charge related to smalleramounts owed by estate agents and developers who either left the site withoutpaying or went into administration during the year. This adversely impactedmargin during the year by 1.8% and if adjusted for the margin would have been57.2%.TaxationThe consolidated tax rate for the year ended 31 December 2008 was 33% (2007:31%). The difference between this and the standard rate of tax at 28.5% relateschiefly to the reversal of the deferred tax asset on share options anddisallowable expenditure charges, notably share-based payments expense.

Share-based payments (IFRS 2)

In accordance with IFRS 2, a non-cash charge of £2m (2007: £2.3m) is includedin the income statement representing amortisation of the fair value of shareoptions granted, including Sharesave options, since 2006.

Net interest

Net interest payable was £1.3m (2007: net interest receivable of £0.7m). TheGroup has moved into a net interest payable position as a result of enteringinto a revolving loan facility in April 2008. The loan bore interest at LIBORplus 150 basis points since its inception.

The Group's interest cover ratio at 31 December 2008 was 31:1, well above the minimum level of 4:1 specified in the related bank covenant.

Earnings per share

Basic earnings per ordinary share of 22.5p (2007: 15.2p) is based on profit after taxation and a weighted average of 113,405,224 shares in issue (2007: 123,023,728). Underlying basic earnings per ordinary share on continuing operations and before share-based payments, NI on share options under issue and capital reconstruction costs was 23.8p (2007: 18.7p).

Balance sheet

Total shareholders' deficit amounted to £15.5m at 31 December 2008 (2007:retained earnings of £12.4m). The Group's net liability position at 31 December2008 has arisen entirely as a result of the draw down of the revolving loanfacility of £39.7m and the application of the funds to buy back shares duringthe year. It is anticipated that £25m of this facility will be converted into afive year term loan by April 2009. This is explained in detail in Note 1 to thefinancial statements.

Trade and other receivables increased from £11.2m to £12.6m in part due to the strong growth in revenue but also as a result of £1m of marketing related prepayments.

Trade and other payables decreased from £14.7m to £12.4m principally due to a reduction in payroll related accruals and the 2008 payments of capital reconstruction costs accrued as at 31 December 2007 during the year.

Cash flow and net debt

Cash generated from operations was £38.7m (2007: £29.9m) and cash flowconversion remained high at 98% in line with our historical record. Net cashfrom operating activities was £11.5m lower at £27.2m (2007: £25.6m) due to thepayment of taxes of £10m and interest of £1.5m. Capital expenditure was lowerthan the previous year at £1m (2007: £1.8m) as 2007 included £0.4mnon-recurring spend in relation to the investment in the new finance billingsystem.A total of £45m was invested during 2008 in the repurchase of our own shares(2007: £19.4m) while a further £10.4m was paid by way of dividends (2007: £6.2m).

Net debt at 31 December 2008 was £16.9m (2007: net cash of £11.8m).

The Board's priorities for the usage of cash are: investment in the business;payment of the dividend; and the return of excess cash to shareholders viashare buy backs. We believe that the future working capital and capitalexpenditure requirements of the business will continue to be low and that thebusiness will be in a position to return surplus capital to shareholders during2009 through sustained dividends.

Current trading and outlook

2009 has started with the Rightmove.co.uk website experiencing high levels ofsite traffic and enquiries, including several of the busiest days ever in termsof email enquiries generated to our advertisers. We have seen an initialdecrease in the rate of estate agents leaving the industry and more marketingactivity from developers compared to late in 2008.We believe that the outlook for the UK residential housing market as a wholewill be driven by the wider economic environment in the UK. The current levelsof housing transactions are unsustainably low, the equivalent of people onaverage never moving from the first home they buy for the rest of theirlife-time. Given the dramatic reduction in the cost base of the propertyindustry, we believe that relatively modest increases in transaction volumeseven if only to the levels seen early in 2008 will transform the viability ofmany of the most threatened estate agents and developers. The number ofdevelopments available to be marketed is likely to decline given the reductionin housing starts, though with transaction levels so low this may be a gradualprocess.

So is the downturn in property advertising in traditional media cyclical or structural?

There can be no doubt that the current situation represents a huge cyclicaldownturn. Our results in 2008 and our start to 2009 suggest that onlineproperty portals are also bringing about a major structural shift. The ultimateanswer to the question will become clear as property advertising spend startsto increase again.Hence, our strategy is to remain the clear leader in the UK online propertyadvertising market, to continue to invest in our product and brand and tocontinue to prepare for the market recovery. In many ways we believe theopportunities to build on our market share of the industry spend on advertisingwill be considerable in the future as the trend to use traditional media in theUK property market fails to return.

The Board is confident of meeting its expectations for the coming year.

Ed Williams Managing Director Graham Zacharias, Finance Director27 February 2009BOARD OF DIRECTORSScott Forbes, Chairman

Scott Forbes was appointed Chairman of Rightmove plc in July 2005. He is also the Chief Executive of Bridge Capital Advisors Ltd which he founded in 2007.

Scott has nearly 30 years' experience in operations, finance and mergers &acquisitions which includes 15 years at Cendant Corporation. Cendant wasformerly the largest provider of residential property services worldwide. Scottestablished the international headquarters in London in 1999 and led thisdivision as Group Managing Director until he joined Rightmove. He was Chairmanor Chief Executive of various residential property and travel industrybusinesses during his tenure at Cendant and held similar roles for othercompanies in other sectors, including National Car Parks and Green Flag. Priorto his time at Cendant, Scott was a certified public accountant. (Appointed13 July 2005.)

Ed Williams, Managing Director

Ed Williams was appointed to the Board of Rightmove plc in December 2000,shortly after joining the newly founded business as the then Group ManagingDirector. Ed formed the senior management team that continues to run Rightmoveand leads the day-to-day operational management of the Group. He is Chairman ofHoliday Lettings Limited in which Rightmove has a two-thirds ownership stake.His prior experience is in business strategy and IT consulting with McKinsey & Co, Accenture and JPMorgan. (Appointed 19 December 2000.)Nick McKittrick, Chief Operating Officer

Nick McKittrick joined Rightmove plc in 2000. He led the development of theCompany's original website and then went on to build the new homes, lettingsand overseas businesses. At the start of 2005 Nick became the Managing Directorof the main Rightmove.co.uk operating subsidiary overseeing a trebling ofrevenue in three years. In January 2009, he was promoted to the role of ChiefOperating Officer and Finance Director in preparation for the retirement ofGraham Zacharias who retires from the Board in April 2009. Before joining theCompany he worked in Accenture for eight years in the technology consultingdivision. (Appointed to the Board on 5 March 2004.)

Graham Zacharias FCA, Finance Director

Graham Zacharias was appointed Finance Director of Rightmove plc inJanuary 2006. He is also a non-executive director of Umeco plc. He qualified asa chartered accountant with Coopers and Lybrand, working in Spain for severalyears before joining Schlumberger where he held a number of finance roles inDubai and London. He then moved to Singapore as Managing Director of a small,publicly-quoted company before returning to the UK as Finance Director of BTR'sAerospace Group. Graham was formerly Group Finance Director for over nine yearsat Spectris plc, a process and control and instrumentation company in theFTSE 250. (Appointed 17 January 2006. Graham will retire from the Board inApril 2009.)

Jonathan Agnew, Non-executive Director

Jonathan joined the Board in January 2006 as Senior Independent Director. He isChairman of Beazley Group, LMS Capital, The Cayenne Trust and Ashmore GlobalOpportunities. Jonathan was an investment banker for over 25 years, includingbeing a Managing Director of Morgan Stanley and Group Chief Executive ofKleinwort Benson. He has been Chairman of Nationwide Building Society, Limitand Gerrard Group and has served on the Council of Lloyd's. (Appointed16 January 2006.) (Chairman of the Remuneration Committee, member of the Auditand Nomination Committees.)

Nigel Cooper, Non-executive Director

Nigel joined Rightmove plc in January 2006 as a non-executive director and alsoas Chairman of the Audit Committee, where he provides oversight of thefinancial reporting practices, internal control environment and compliance withthe various listed company regulations. He is also a member of the RemunerationCommittee. Nigel is a non-executive director of Metro International S.A. (aNordix OMX listed company) where he also chairs the Audit Committee. Nigel wasformerly a senior partner at KPMG LLP and was Lead Audit and Advisory Partnerfor KPMG's Information, Communications and Entertainment Group based in London.(Appointed 16 January 2006. Having completed his three year term, Nigel willretire from the Board in March 2009.) (Chairman of the Audit Committee andmember of the Remuneration Committee.)

Colin Kemp, Non-executive Director

Colin Kemp was appointed to the Board in July 2007. He is Managing Director ofHalifax Bank of Scotland (HBOS) Retail Network, North Division covering bankbranches across Scotland, Northern Ireland and the North of England. With over25 years' experience in high street retail banking, Colin has worked for HBOScompanies since 1979. His roles have included running the HBOS Retail ContactCentres, one of the largest call centre operations in Europe, and heading upthe Halifax Employee Share Services business administering employee share plansto over 400 UK companies, including 27 of the FTSE 100. Colin is a CranfieldMBA and an Associate of the Chartered Institute of Marketing. (Appointed3 July 2007.)

Stephen Shipperley, Non-executive Director

Stephen Shipperley joined the Board on its formation in 2000. Stephen has over30 years of experience in the property industry. He is Group Executive Chairmanof Connells Limited, which has grown to become the second largest estate agencybusiness in the UK with interests in residential estate agency, surveying,financial services, relocations and conveyancing. (Appointed 30 June 2000.)

Judy Vezmar, Non-executive Director

Judy is Chief Executive Officer of LexisNexis International. LexisNexis®, partof the global media group Reed Elsevier PLC, is a leading worldwide provider ofcontent-enabled workflow solutions designed specifically for professionals inthe legal, risk management, corporate, government, law enforcement, accountingand academic markets. Judy is responsible for the International group and theirexpansion of the range of successful online services to over 100countries. She is based in London. (Appointed 16 January 2006.) (Member ofthe Audit, Remuneration and Nomination Committees.)

Liz Taylor, Company Secretary

Liz Taylor was appointed Company Secretary of Rightmove plc on 4 July 2006. Sheis a Fellow of the Institute of Chartered Secretaries and Administrators andhas 20 years' company secretarial experience across a variety of publiccompanies. Prior to joining Rightmove, she was Company Secretary of TheBerkeley Group Holdings plc.SENIOR MANAGEMENT TEAM

Miles Shipside, Commercial Director

Miles joined Rightmove as a founding director in 2001 bringing 20 years of experience at senior levels in independent estate agency and with Halifax Estate Agency. He has responsibility for estate agency and media relations, specialising in advising the industry on how the internet is transforming home moving and the state of the housing market. He qualified as a Chartered Surveyor in 1982.

Peter Brooks-Johnson , Agency Director

Peter joined Rightmove in 2006 and is responsible for the Estate Agency business and the development of the Rightmove proposition to customers, including the development of the Rightmove Choice products and the website.

Peter was formerly a management consultant with Accenture and The Berkeley Partnership working with clients such as BP, Marks & Spencer and Woolwich.

Peter Armstrong, New Homes Director

Peter joined Rightmove in 2003 as one of the first handful of people developingthe New Homes business, a business which he has run since May 2006. He is nowresponsible for 50 people in Rightmove's fastest growing business unit and ispart of the new homes industry community. Prior to Rightmove, Peter worked insales and sales management, latterly in directory advertising with Yell.

Alan Gearing, Managing Director, Rightmove AVM

Alan joined Rightmove in 2006 developing new sources of revenue separate fromproperty advertising. He was appointed as Managing Director of Rightmove'sAutomated Valuation Model division in July 2008. Prior to Rightmove he was afounder of both The Asset Management Group (property disposal and maintenanceservices) and The Inventory Exchange (online inventory and propertyinspection).

Kathryn Harris, Marketing Director

Kath joined Rightmove in 2008 as Marketing Director following almost eightyears at Unilever where she was responsible for developing global brands suchas Dove, Persil and Sure. Kath is now focussing on strengthening Rightmove'smarketing and PR efforts to both the home hunters and trade member audiences,helping to maintain Rightmove's leadership position.

Scott Marshall, Finance Director of Rightmove.co.uk

Scott joined Rightmove in 2001 as Finance Director and was Company Secretaryuntil the IPO in 2006. Scott led the preparations for the float on the LondonStock Exchange in 2006 and led the recent Scheme of Arrangement to introduceand list a new holding company for the Group. Scott is a director of HolidayLettings Limited. Scott qualified as a Chartered Accountant in Australia withErnst & Young.

Simon Hickie, Human Resources Director

Simon joined Rightmove in 2007 following seven years at Bloomberg LP where hewas responsible for HR operations across Europe, the Middle East and Africa.Prior to moving into HR, he had managed part of Bloomberg's financial researchoperation covering new debt and equity security issuance and M&A activity inEurope.

Robyn Perriss, Financial Controller

Robyn joined Rightmove in 2007 and has day-to-day responsibility for the financial operations, based out of Milton Keynes, as well as statutory reporting and the treasury function. She was formerly Group Financial Controller at the online media business, Auto Trader. She qualified as a chartered accountant in South Africa with KPMG.

Corporate Social Responsibility

Our people

Our employees are our largest resource and our most highly valued asset. We are proud of our people and the mixture of talent and experience that they represent and we depend on their skills and commitment to achieve our objectives.

Throughout 2008, we have taken further steps in ensuring that Rightmovecontinues to be an environment in which our employees are nurtured to ensurethat their skills and knowledge are continuously developed. Our culturaluniqueness is bolstered by an open and honest communication environment andthrough investment in ensuring that all employees have a profound understandingof Rightmove's core values and goals. This is achieved through a combination ofoff-site residential training, ongoing coaching and mentoring. Staff opinionsare frequently sought through regular staff forums with senior managers andemployee online surveys. Being an online company, communication with allemployees can easily be achieved by regular emails and the use of the intranet.Over the course of 2008, we have introduced an internal training academydesigned to provide a structured means for employees to expand and diversifytheir skills and knowledge and explore new ways of working with one another.During 2009 we will continue to focus on developing and rewarding our people.Rightmove has a strong commitment to equality of opportunity in all ouremployment policies, practices and procedures. We take a proactive approachthroughout our recruitment and selection process to ensuring that we attract,hire and retain a diverse and talented workforce and this is kept under closeand regular scrutiny. No existing or potential employee will receive lessfavourable treatment due to their race, creed, nationality, colour, ethnicorigin, age, religion or similar belief, connections with a national minority,sexual orientation, gender, gender reassignment, marital status, membership ornon-membership of a trade union, disability, or any other classification asprescribed by law.

Charitable activity

During 2008, our employees continued to support the NSPCC, our Companynominated charity and we continue to encourage all our employees to devote timeand fundraising efforts to charitable causes of particular importance to themas individuals. During 2008 a considerable number of staff have been active inraising money or supporting the fundraising activities of others.

Environment

Rightmove actively considers its environmental impact. Since our operation is primarily office-based, the direct environmental impact is relatively low. Indeed Rightmove's business creates opportunities to reduce the overall environmental harm associated with a variety of aspects of the whole home hunting process and even home ownership more generally.

Traditional ways of finding a home tend to involve large amounts of paper andprinting, whether in the form of newspaper advertising, property particularsmailed to applicants through the post or leaflet drops by agents. Rightmovereduces the need for print media and the environmental damage that goes withthem. Rightmove takes care to design the layout of property particulars toreduce the total number of pages that need to be printed out in those caseswhere a home hunter does want a physical copy.Enhanced information on properties also reduces the amount of time home hunterswaste in visiting properties that rapidly turn out to be inappropriate. As ahigh proportion of viewings involve a car journey, any reduction in wastedviewings has an environmental benefit. Rightmove has worked hard to increasethe number of photographs of each property and has introduced morecomprehensive maps and aerial photographs which help home hunters to identifythe specific location of a property. More high quality information presentedabout properties reduces waste.The Rightmove.co.uk website includes functionality for our customers to displayEnergy Performance Certificates which allow prospective buyers to evaluate theenergy efficiency of a property they are considering buying and to identifyopportunities to improve the energy efficiency once they have purchased theproperty.We also take seriously the environmental impact of our own operations. As aninternet-based company with most staff employed in two office locations, webelieve our own environmental footprint is small and that there are noby-products of our operations which have a clear negative impact on theenvironment. Our staff are encouraged to take proactive steps to address ourenvironmental responsibilities. For instance, we continue to operatecomprehensive recycling schemes which were established in consultation withlocal authorities and recycling partners. As an online company, our cultureemphasises a paperless environment. We also recognise that our responsibilitiesdo not stop just with how we operate internally - we also encourage all ourcustomers, business partners and suppliers not to unnecessarily print outemails sent by us in the signature of all our emails. Moreover, we have alsointroduced e-communications for our shareholders, including an HTML copy of theannual report to enable investors and people with an interest in the Company toprint specified pages thereby reducing the quantity of printed material wedistribute.

Health and safety

The Group considers the effective management of health and safety to be anintegral part of managing its business. During 2008, we continued our firesafety procedures, first aid skills and work place safety training. The Group'songoing policy on health and safety is to provide adequate control of thehealth and safety risks arising from work activities, through furtherconsultation with and training of employees, the provision and maintenance ofplant and equipment, safe handling and use of all substances and the preventionof accidents and causes of ill health. The Group will maintain safe and healthyworking conditions for employees, visitors and contractors, and keep the policyon health and safety up-to-date with regular reviews and necessary alterationsto the policy as required.DIRECTORS' REPORTThe directors submit their report together with the audited financialstatements for Rightmove plc (the Company) and its subsidiary companies (theGroup) for the year ended 31 December 2008. The Company is domiciled in England(registered number 6426485).Principal activitiesThe Group operates in the UK residential property industry connecting people toproperties.Its principal business is the operation of the Rightmove.co.uk website, whichis the UK's largest residential property website. Its customers (estate agents,letting agents, new homes developers and overseas homes agents) pay fees forthe right to display properties on the Rightmove website, which provides homehunters with property details to search.

Rightmove plc floated on the London Stock Exchange on 15 March 2006 and subsequently became a member of the FTSE 250 Index.

In March 2007, the Company acquired 66.7% of Holiday Lettings Limited, a provider of online advertising services to owners of holiday rental properties.

Further information on the Group's activities during the year under review andof its prospects are contained in the Business and Financial Review on pages 4to 10.The following sections inclusive are incorporated by reference into thedirectors' report which have been drawn up and presented in accordance with andin reliance upon acceptable English company law and the liabilities of thedirectors in connection with the report shall be subject to the limitations andrestrictions provided by such law:• Business and Financial Review (pages 4 to 10)• Board of Directors (pages 11 to 12)• Corporate Social Responsibility (pages 14 to 15)• Corporate Governance (pages 21 to 28)• Remuneration Report (pages 29 to 38)In compliance with the business review provisions of the Companies Act 1985,within the Business and Financial Review, principal risk factors are discussedunder the section "Uncertainties, threats and risks" on page 8. Key performanceindicators (KPIs) are given on page 5 and information on the likelydevelopments of the Group under "Current Trading and Outlook" on page 10.

Scheme of arrangement

In January 2008, pursuant to a Scheme of Arrangement under the Companies Act1985 (the Scheme), a new parent company was introduced, which on listing on theLondon Stock Exchange was called Rightmove Group plc and subsequently renamedRightmove plc. The Scheme constituted a share capital reconstruction, wherebyshareholders exchanged their shares on a like for like basis for shares in thenew listed company and has been accounted for as a reverse acquisition.Therefore, although the reconstruction did not become effective until28 January 2008, the consolidated financial statements of the new parentcompany are presented as if the new company and the previously listed companyhad always been part of the Group. Accordingly, the results of the Group forthe entire year ended 31 December 2008 are shown in the consolidated incomestatement and the comparative figures for the year ended 31 December 2007 arealso presented on this basis.

Trading results

The Group's consolidated underlying operating profit from continuing operations(before share-based payments, National Insurance (NI) on share options underissue and capital reconstruction costs) for the financial year was £41,004,000(2007: £30,746,000). Further information on the results for the Group is setout in the Consolidated Income Statement on page 41 and the supporting Notesand the Business and Financial Review on pages 4 to 10.

Dividend

An interim dividend of 3.0p (2007: 2.0p) per share was paid on 10 October 2008to shareholders on the register of members at the close of business on12 September 2008.The directors are recommending a final dividend for the yearof 7.0p (2007: 6.0p) per share, which together with the interim dividend of3.0p, paid in respect of the half year period ended 30 June 2008, makes a totalfor the year of 10.0p (2007: 8.0p), amounting to £10,919,000 (2007: £9,529,000). Subject to shareholders' approval at the Annual General Meeting on6 May 2009, the final dividend will be paid on 12 June 2009 to shareholders onthe register of members at the close of business on 15 May 2009.

The final dividend payment has not been included in trade and other payables as it was not approved before the year end.

Share capital

The issued share capital (including 2,505,430 shares held in treasury) at theyear end consisted of 120,050,873 (2007: 132,689,361) ordinary shares of £0.01each being £1,201,000 (2007: £1,327,000). Movements in the Company's sharecapital in the year are shown in Note 22 to the financial statements.Information on the Group's share option schemes is set out in Note 24 to thefinancial statements. Details of the share option schemes for directors are setout in the Remuneration Report on page 37.

Share buy back

The Company announced a share buy back programme in June 2007, which hascontinued during 2008. Of the 15% authority given at the 2008 Annual GeneralMeeting, 7,924,105 shares were purchased in the period from 7 May 2008 to31 December 2008 being 6.2% of the issued share capital of the Company(excluding shares held in treasury) at the time the authority was granted. Atotal of 11,854,535 shares were purchased in the year to 31 December 2008. Theaverage price paid per share was £3.78 with a total consideration paid(inclusive of all costs) of £45,044,000. Of the 11,854,535 shares purchased,2,505,430 shares were transferred into treasury.

A resolution seeking to renew this authority will be put to shareholders at the Annual General Meeting on 6 May 2009.

Shares held in trust

As at 31 December 2008, 8,353,700 ordinary shares of the Company were held inThe Rightmove Employees' Share Trust (EBT) for the benefit of Group employees(2007: 8,353,700). These shares had a nominal value at 31 December 2008 of £84,000 (2007: £84,000) and a market value of £14,703,000 (2007: £38,761,000).The shares may be used to satisfy options for all the Group's employee shareplans.

The terms of the EBT provide that dividends payable on the shares held by the trust are waived.

Substantial shareholdingsAs at the date of this report, the following beneficial interests in 3% or moreof the Company's issued ordinary share capital (excluding shares held intreasury) on behalf of the organisations shown in the table below, had beennotified to the Company pursuant to Rule 5 of the Disclosure Rules andTransparency Rules: No of shares % Lone Pine Capital LLC 11,938,107 10.2 Tremblant Partners LP 11,896,449 10.1 Capital Group Companies Inc 11,106,609 9.5

Baillie Gifford & Company Ltd 8,708,438

7.4

The Rightmove Employees' Trust 8,353,700

7.1 Artisan Partners LP 7,825,597 6.7 BlackRock 6,202,630 5.3 Legal and General Investment 4,171,564 3.6 Caledonia Investment plc 4,140,576 3.5

The above percentages are based upon an issued share capital (excluding shares held in treasury) of 117,545,443.

Directors

The directors of Rightmove plc at the year end and as at the date of this report are named on pages 11 to 12 together with their profiles. All directors served throughout the year under review.

The Articles of Association of the Company require directors to submitthemselves for re-appointment where they have been a director at each of thepreceding two Annual General Meetings and were not appointed or re-appointed bythe Company at, or since, either such meeting.Nigel Cooper (non-executive director) and Graham Zacharias (executive director)are the two directors that would be eligible to seek re-election at the 2009Annual General Meeting under these provisions. Nigel Cooper gave notice inOctober 2008 that he would not be seeking re-election on expiry of his threeyear term of office in 2009 due to time commitments to his wider non-executivedirectorship portfolio. Nigel Cooper will step down from office on31 March 2009. Graham Zacharias also retires from the Board on 10 April 2009and will not stand for re-election.

All other directors of the Company were either appointed or re-appointed at the 2007 or 2008 Annual General Meetings. Therefore, no director is required to submit themselves for re-election at the 2009 Annual General Meeting.

The interests of the directors in the share capital of the Company at 31December 2008, the directors' total remuneration for the year and details oftheir service contracts and Letters of Appointment are set out in theRemuneration Report on pages 29 to 38. At 31 December 2008 each of theexecutive directors was deemed to have a non-beneficial interest in 8,353,700ordinary shares held by the trustees of the EBT.

Directors' interests in contracts

Stephen Shipperley, non-executive director, is Group Chairman of ConnellsLimited. Colin Kemp, non-executive director, held the position of ManagingDirector of Halifax Estate Agencies Limited from January 2005 to December 2007.Prior to the IPO in 2006 the Group had entered into agreements with ConnellsLimited and Halifax Estate Agencies Limited to list all their respective estateagency properties on Rightmove.co.uk until at least March 2009. In December2008, the Company announced that the agreement with Connells Limited had beenextended into 2012. Further details of amounts owed by and invoiced to ConnellsLimited and Halifax Estate Agencies Limited are disclosed in the sectiondealing with Related Party Disclosures in Note 27 to the financial statementson page 69.Supplier payment policyThe Group and Company's policy concerning creditors is to agree payment termswith its suppliers, ensure the relevant terms of payment are included incontracts and to abide by those terms when it is satisfied that goods orservices have been provided in accordance with the contracts. For the year to31 December 2008, trade creditors represented 25 days (2007: 50 days) ofaverage daily purchases. The Group had £1.2m of trade payables at the year

end(2007: £1.7m).Research and developmentThe Group undertakes research and development expenditure in view of developingnew products and improving the existing property websites. Further details aredisclosed in Note 2 to the financial statements on page 49.

Charitable and political donations

The Company made no charitable contributions or political donations during the year (2007: nil).

Annual General Meeting

The Annual General Meeting of Rightmove plc will be held at the offices of UBS Limited at 1 Finsbury Avenue, London EC2M 2PP on 6 May 2009 at 10am.

The majority of the resolutions being proposed at the 2009 Annual GeneralMeeting are general in nature including the renewal for a further year of thelimited authority of the directors to allot the unissued share capital of theCompany and to issue shares for cash other than to existing shareholders. Aresolution will also be proposed to renew the directors' authority to purchasea proportion of the Company's own shares.There is also one item of special business. The Company adopted new Articles ofAssociation at the Annual General Meeting in 2008 and therefore most of thecurrent changes required in relation to the Companies Act 2006 are in place.The exception to this is the Shareholder Rights Directive, which is intended tobe implemented in the UK in August this year. One of the requirements of theDirective is that all general meetings must be held on 21 days' notice unlessshareholders agree to a shorter notice period. The Company's existing Articlesof Association already provide the power to call general meetings (other thanannual general meetings) on 14 days' notice and we will therefore be proposinga resolution at the Annual General Meeting so that we can continue to be ableto do so after the Directive is implemented.An explanation of these and other resolutions being proposed at the 2009 AnnualGeneral Meeting will be provided in the Notice of Annual General Meeting, whichwill be sent to shareholders (where requested) and posted on the corporatewebsite (www.rightmove.co.uk/investors.rsp) in March 2009.

Auditors

KPMG Audit Plc has confirmed its willingness to continue in office as auditorsof the Group and separate resolutions for their re-appointment and for theAudit Committee to determine their remuneration will be proposed at the AnnualGeneral Meeting.Audit information

So far as the directors in office at the date of signing of the report areaware, there is no relevant audit information of which the auditors are unawareand each such director has taken all reasonable steps to make themselves awareof any relevant audit information and to establish that the auditors are awareof that information.

Responsibility statement of the directors in respect of the annual financial report

We confirm that to the best of our knowledge:

* the financial statements, prepared in accordance with the applicable set of

accounting standards, give a true and fair view of the assets, liabilities,

financial position and profit of the Company and the undertakings included

in the consolidation taken as a whole; and * the directors' report includes a fair review of the development and performance of the business and the position of the issuer and the

undertakings included in the consolidation taken as a whole, together with

a description of the principal risks and uncertainties that they face.

Signed by the Board:Ed Williams, Managing Director Graham Zacharias, Finance Director27 February 2009CORPORATE GOVERNANCEStatement of compliance

The 2006 Combined Code of Corporate Governance (Combined Code) sets out theprinciples and provisions relating to good governance of UK listed companies.In this section we set out how we have applied the principles and complied withthe provisions of the Combined Code during 2008 and explain the reason for

onearea of non-compliance.The Board

During the year and as at the date of this report, the Board comprises ninedirectors including the Chairman (Scott Forbes), three executive directors (EdWilliams, Managing Director, Nick McKittrick and Graham Zacharias) and fivenon-executive directors (Jonathan Agnew, who is the Senior IndependentDirector, Nigel Cooper, Judy Vezmar, Stephen Shipperley and Colin Kemp). TheCompany announced that Graham Zacharias will step down from the Board on10 April 2009 thereby reducing the number of executive directors to two goingforward and increasing the balance of non-executive directors in the overallcomposition of the Board.Stephen Shipperley is Group Executive Chairman of Connells Limited and instrict application of the criteria of the Combined Code is not considered to beindependent. Colin Kemp has worked for HBOS companies for 30 years and held theposition as Managing Director of Halifax Estate Agencies Limited from January2005 to December 2007. The Board considers that both Stephen Shipperley andColin Kemp are independent in character and in particular both continue tochallenge rigorously the executive directors and the Board as a whole. Whilstthe composition of the Board for the period under review was not in strictcompliance with supporting principle A3.2 of the Combined Code in that at leasthalf of the directors (excluding the Chairman) are not considered independentnon-executive directors, the directors believe that the Board currentlyoperates effectively and that all the non-executive directors are fullyindependent of management and that Jonathan Agnew, Nigel Cooper and Judy Vezmarare free from any business or other relationship that could materiallyinterfere with the exercise of their independent judgment and advice to theBoard.Graham Zacharias, the retiring Finance Director, is also a non-executivedirector of Umeco plc. His remuneration for that position is retained by himand is set out in the Remuneration Report on page 33. Neither the Chairman norany of the executive directors hold any other non-executive directorships orcommitments disclosable under the Combined Code.

Biographical details of the directors appear on pages 11 and 12.

Directors' remuneration

The principles and details of directors' remuneration and contractual arrangements are contained in the Remuneration Report on pages 29 to 38.

Board and Committee membership and attendance

In accordance with the Combined Code, the Articles of Association require alldirectors to seek re-election every three years. In addition all directors aresubject to election by shareholders at the first opportunity after theirappointment. As previously explained in the Directors' Report, no director isrequired to seek re-election at the 2009 Annual General Meeting.

The membership of the Committees of the Board and attendance at meetings for the period under review are set out in the table below.

Board Remuneration Audit Nomination Committee Committee Committee Total meetings 8 6 4 2 Scott Forbes 8 6(1) N/A 2 Jonathan Agnew 8 6 4 2 Nigel Cooper 8 6 4 N/A Colin Kemp 7 N/A N/A N/A Nick McKittrick 8 N/A N/A N/A Stephen Shipperley 8 N/A N/A N/A Judy Vezmar 8 6 4 2 Ed Williams 8 N/A N/A N/A Graham Zacharias 8 N/A N/A N/A

(1) The Remuneration Committee Chairman has requested that the Chairman of the Board attends the Remuneration Committee meetings.

In addition to the above meetings, the Chairman conducts meetings with thenon-executive directors without the executive directors being present whenrequired. Jonathan Agnew, the Senior Independent Director, chaired a meeting ofthe Board at which the performance of the Chairman was also reviewed (withoutthe presence of the Chairman).

Operation of the Board

The Board is responsible to shareholders for the overall direction and controlof the Group. Its key task is to approve strategy, ensuring the successfulimplementation of projects and proposals and monitoring the operatingperformance of the Group in pursuit of its objectives in the interest ofmaximising long-term shareholder value. The Board has adopted a formal scheduleof matters requiring specific approval. These include, amongst other things,the approval of the annual business plan, capital structure, dividend policy,acquisitions and disposals, appointment and removal of officers of the Company,approval of the Half Year and Full Year results, shareholder communication andresponsibility for corporate governance and review of the Company's risks andsystem of internal controls.The Board receives meeting papers one week prior to the meeting to allowsufficient time for detailed review and consideration of the documentsbeforehand. If any director has a concern about any aspect of the businessconducted at any Board meeting, the Company Secretary shall discuss this withthe director concerned and record their concern or comments in the Boardminutes. The Board also receives monthly management and financial reports onthe operational and financial performance of the business setting out actualand forecast financial performance against approved budgets in addition toother key performance indicators. The Board also receives copies of brokerreports and press releases relating to the Group. At least once a year theManaging Director and the senior management team present a strategic review andan annual plan to the Board for review and approval.The Board meets formally around eight times each year although meetings can bescheduled at short notice at the request of any director or if required. Inaddition to formal Board meetings, there is regular, informal dialogue betweenall directors.

Chairman and Managing Director

There are clear written guidelines to support the division of responsibilitiesat the head of the Company with the roles of the Chairman and Managing Directorseparately held. The Chairman is responsible for the effective conduct of theBoard, for communication with shareholders and for ensuring that each directoruses their skills and experience to the benefit of the Board's effectivedecision making. With the assistance of the Company Secretary, the Chairmanmonitors the information provided to the Board to ensure that it is sufficient,pertinent, timely and clear.

The Managing Director has day-to-day executive responsibility for the running of the Group, leading the executive and operational teams in developing strategies and delivering results against defined objectives to enable the Group to meet its objectives.

Board training

The breadth of management, financial and listed company experience of thenon-executive directors is described in the biographical details on pages 11and 12, and demonstrates a range of business expertise that provides the rightmix of skills and experience given the size of the Company. There areprocedures in place for individual Board members to receive induction andtraining as appropriate and to seek the advice and services of independentprofessional advisers, at the Company's expense, where specific expertise ortraining is required in the course of their duties.The directors disclose a qualifying third-party indemnity provision between theCompany and its directors and officers as provided by the Articles ofAssociation of the Company, which was in force at the date of this report. TheGroup has also arranged directors' and officers' insurance cover in respect oflegal action against the directors.The Group has set out written policies in compliance with a code of securitiesdealings in relation to the shares and equivalent to the Model Code publishedin the Listing Rules. The code applies to all directors, other personsdischarging managerial responsibility and other relevant employees.

Board evaluation

The Board conducted a Board evaluation exercise in quarter four of 2008 whichwas led by the Chairman, assisted by the Company Secretary. All directorscompleted a comprehensive questionnaire inviting feedback on the operation ofthe Board and its Committees, knowledge of strategy and the business and itscollective performance. The results were discussed at a Board meeting inDecember 2008 and it was agreed that the Board was operating effectively.Actions were mainly administrative in nature and will be followed up by theChairman in early 2009. In addition each director completed an individualquestionnaire on the performance of each of their Board colleagues and feedbackwas provided at one-to-one meetings conducted by the Chairman. At a meetingchaired by Jonathan Agnew, Senior Independent Director, the Board providedinput into and reviewed the performance of the Chairman.

Relations with shareholders

The Board is accountable to shareholders for the performance and activities of the Company and the Chairman ensures that effective communication with shareholders takes place.

Within the terms of the regulatory framework, the Company has conducted regulardialogue with shareholders through ongoing meetings with institutionalinvestors and research firms to discuss strategy, operating performance andfinancial performance. Contact in the UK is principally with the ManagingDirector and Finance Director. The Chairman also participates in the USAbi-annual investor road shows. Jonathan Agnew, the Senior Independent Director,is available to shareholders if they wish to supplement communication or ifcontact through the normal channels is inappropriate.Shareholders are also kept up to date with the Group's activities through theFull Year and Half Year Reports and the investor relations section of itswebsite, which provides details of all the directors, latest news, includingfinancial results, investor presentations and Stock Exchange announcements.The Board is kept informed of the views and opinions of those with an interestin the Company through reports from the Managing Director and Finance Directoras well as reports from the Company's joint brokers, UBS and Numis. Alldirectors receive notification of any changes in the status of substantialshareholders and at each Board meeting an update is given by the executivedirectors on the movements in major shareholdings and on the views and opinionsof those with an interest in the Company.

Conflicts of interest

The Chairman of the Board is responsible for determining, in cases of doubt,whether a conflict of interest exists. There were no matters discussed at anyBoard meeting that gave rise to a conflict of interest.

Annual General Meeting

All shareholders are invited to participate in the Company's Annual GeneralMeeting on 6 May 2009 where all directors will be available to answer questionsand will also be available for discussions with shareholders prior to and afterthe meeting.

The Company will arrange for the Annual Report and Accounts and related papers to be available on the Company's corporate website at www.rightmove.co.uk/ investors.rsp or posted to shareholders (where requested) so as to allow at least 20 working days for consideration before the Annual General Meeting.

The Company also complies with the Combined Code with the separation of allresolutions put to the vote of shareholders. The Company proactively encouragesshareholders to vote at general meetings by providing electronic voting forshareholders who hold their shares through the Crest system and providespersonalised proxy cards to ensure that all votes are clearly identified. TheCompany presently takes votes at general meetings on a show of hands on thegrounds of practicality due to the limited number of shareholders inattendance. Votes are taken by a poll at any shareholder meeting where legallyrequired. All proxy votes are counted and the level of proxy votes includingabstentions lodged for each resolution are reported after each resolution andpublished on the Company's website.

Board committees

The Board has established three principal committees, the Audit Committee, theRemuneration Committee and the Nomination Committee, each of which operateswithin written terms of reference approved by the Board. No person other than aCommittee member is entitled to attend the meetings of these Committees, exceptby invitation of the Chairman of that Committee.

Remuneration committee

The Remuneration Committee consists of the three independent non-executivedirectors, Jonathan Agnew (who is Chairman), Judy Vezmar and Nigel Cooper. Inaddition, the Remuneration Committee Chairman has requested that the Chairmanof the Board attends the Remuneration Committee meetings. The quorum formeetings of the Remuneration Committee is two members. The RemunerationCommittee will meet at such times as may be necessary but will normally meet atleast twice a year.The purpose of the Remuneration Committee is to ensure that the Company'sexecutive directors and senior executives are properly incentivised and fairlyrewarded for their individual contributions to the Company's overallperformance having due regard to the interests of the shareholders and to thefinancial and commercial health of the Company.

The Remuneration Committee's terms of reference are available on the Company's website, www.rightmove.co.uk/investors.rsp or by request to the Company Secretary.

The Company Secretary acts as Secretary to the Committee. The Chairman of the Remuneration Committee reports to the Board on the Remuneration Committee's behalf after each meeting and copies of the minutes of the meetings are circulated to the Board as a whole unless a conflict of interest exists.

During the year the Committee appointed Hewitt New Bridge Street, remunerationconsultants, to assist with a review of the remuneration policy and to set theremuneration for the executive directors and senior management for 2009.

A detailed report on the Company's remuneration policy and the work of the Remuneration Committee is available in the Remuneration Report on pages 29 to 38.

Nomination committeeThe Nomination Committee consists of Scott Forbes (who is also Chairman of theBoard), Jonathan Agnew and Judy Vezmar as independent non-executive directors.The quorum for meetings of the Nomination Committee is two members. TheChairman of the Company would not chair the Nomination Committee in connectionwith any discussion about the appointment of his successor to the chairmanshipof the Company, when the Senior Independent Director would take the chair.Appointments are for a period of up to three years, extendable by no more thantwo additional three year periods, so long as members continue to beindependent.The Nomination Committee meets at such times as may be necessary and normallymeets at least twice a year. The purpose of the Nomination Committee is toconsider and make recommendations to the Board about the composition of theBoard, including proposed appointees, and whether to fill any vacancies thatarise or to change the number of Board members.

The Nomination Committee's terms of reference are available on the Company's website, www.rightmove.co.uk/investors.rsp or by request to the Company Secretary.

During the year the Nomination Committee reviewed the organisation structure,approved the plans for the succession of the executive directors and the seniormanagement team, conducted an annual review of its terms of reference andcommenced a search for a new Audit Committee Chairman to replace Nigel Cooperwho will step down from the Board on 31 March 2009.

Audit committee

The Audit Committee consists of the three independent non-executive directors,Nigel Cooper (who is Chairman), Judy Vezmar and Jonathan Agnew. Nigel Cooper isa retired senior partner from KPMG LLP (KPMG) with a 33 year career including21 years as a partner in Milan and London and therefore has relevant financialskills and experience for the role. As Nigel Cooper had not had any priorinvolvement with the KPMG Milton Keynes office or Rightmove plc, hisappointment was considered by the KPMG Ethical Panel to be independent.The quorum for meetings of the Audit Committee is two members. Appointments tothe Committee are for a period of up to three years, extendable by no more thantwo additional three year periods, so long as members continue to beindependent.The Audit Committee meets at least four times a year and more often ifnecessary. Two of its meetings are prior to the announcement of the Half Yearand Full Year results of the Group when the external auditor is in attendance.The Company Secretary acts as Secretary to the Committee. The Finance Directorand Financial Controller are normally invited to attend the meetings.The Chairman of the Audit Committee reports to the Board on the AuditCommittee's behalf after each meeting and copies of the minutes of the meetingsare circulated to the Board as a whole. The Audit Committee assists the Boardin the discharge of its duties concerning the announcement of results, theAnnual and Half Year Reports and the maintenance of internal controls. Itreviews the scope and planning of the audit and the auditor's findings andconsiders the Group's accounting policies and the compliance with thosepolicies and applicable legal and accounting standards.The Audit Committee has authority to investigate any areas of concern as tofinancial impropriety that arise and to obtain outside legal or otherindependent professional advice in connection therewith. The Audit Committee'sprincipal duties and terms of reference are available on the Company's website,www.rightmove.co.uk/investors.rsp or by request to the Company Secretary.During 2008 the Committee has, amongst other matters, approved the appointmentof the external auditors, fixed their remuneration and reviewed theeffectiveness of the external audit process. The Committee has also consideredthe need for an internal audit function. Given the simplicity of theorganisational structure, the open and accountable culture with clear authoritylimits, the straightforward financial model and systems and the fact that themanagement team and Board conduct regular financial reviews, the Committeerecommended to the Board that an internal audit function was not currentlyappropriate for the business. This decision is kept under regular review.The Committee also discussed its responsibilities to safeguard the auditobjectivity and independence as well as the needs of the business and agreedthat it was practical in many cases for the auditors to be assigned to othernon-audit project work due to their knowledge and expertise of the business.This would usually relate to corporate transaction advice and tax compliance.Non-audit fees in excess of £20,000 require the prior approval of the Chairmanof the Audit Committee. In 2008 the bulk of the non-audit fees related to taxadvisory fees, the details of which are provided in Note 6 of the financialstatements.In addition to receiving reports from the external auditors, members met withthe external auditors without the presence of the executive directors. TheCommittee reviewed the Annual and Half Year Reports. The external auditors alsopresented the results of their review of the 2007 Full Year and 2008 Half Yearresults as well as their audit plan to the Audit Committee.

The Committee also reviewed the Whistle Blowing policy (which provides the procedure for staff to report any concerns that they may have independent of management about suspected misconduct without fear of retaliation) and conducted an annual review of its terms of reference.

Internal controls

The Board of directors has overall responsibility for the Group's system of internal controls and has established a framework of financial and other controls, which is periodically reviewed in accordance with the Turnbull guidance for its effectiveness.

The Board has taken, and will continue to take, appropriate measures to ensurethat the chances of financial irregularities occurring are reduced as far asreasonably possible by continually seeking to improve the quality ofinformation at all levels in the Group, fostering an open environment andensuring that the financial analysis is rigorously applied. Any system ofinternal control is designed to manage rather than eliminate the risk offailure to achieve business objectives and can only provide reasonable and notabsolute assurance against material misstatement or loss.The Group's management has established the procedures necessary to ensure thatthere is an ongoing process for identifying, evaluating and managing thesignificant risks to the Group. These procedures have been in place for thewhole of the financial year ended 31 December 2008 and up to the date of theapproval of these financial statements and they are reviewed regularly.

The key elements of the system of internal control are:

* Major commercial, strategic and financial risks are formally identified,

quantified and assessed, discussed with the executive directors, after

which they are considered by the Board;

* A comprehensive system of planning, budgeting and monitoring Group results.

This includes monthly management reporting and monitoring of performance

against both budgets and forecasts with explanations for all significant

variances;

* An organisational structure with clearly defined lines of responsibility

and delegation of authority;

* Clearly defined policies for capital expenditure and investment exist,

including appropriate authorisation levels, with larger capital projects,

acquisitions and disposals requiring Board approval;

* A treasury function which manages net debt against cash flow forecasts and

is responsible for monitoring compliance with bank covenants; and

* A Whistle Blowing policy of which all employees are made aware, to enable

concerns to be raised either with line management or, if appropriate,

confidentially outside the line management.

Through the procedures outlined above, the Board has considered all significant aspects of internal control for the year and up to the date of this Annual Report and Accounts.

Going concern

After making prior enquiries, the directors have a reasonable expectation thatthe Group has adequate resources to continue in operational existence for theforeseeable future. For this reason, they continue to adopt the going concernbasis in preparing the financial statements. Further information is provided inNote 1 to the financial statements.

Statement of directors' responsibilities in respect of the Annual Report and financial statements

The directors are responsible for preparing the Annual Report and the Group and parent Company financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare Group and parent Companyfinancial statements for each financial year. Under that law they are requiredto prepare the Group financial statements in accordance with IFRSs as adoptedby the EU and applicable law and have elected to prepare the parent Companyfinancial statements on the same basis.The Group and parent Company financial statements are required by law and IFRSsas adopted by the EU to present fairly the financial position of the Group andthe parent Company and the performance for that period; the Companies Act 1985provides in relation to such financial statements that references in therelevant part of that Act to financial statements giving a true and fair vieware references to their achieving a fair presentation.

In preparing each of the Group and parent Company financial statements, the directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgments and estimates that are reasonable and prudent;

• state whether they have been prepared in accordance with IFRSs as adopted by the EU; and

• prepare the financial statements on the going concern basis unless it isinappropriate to presume that the Group and the parent Company will continue inbusiness.The directors are responsible for keeping proper accounting records thatdisclose with reasonable accuracy at any time the financial position of theparent Company and enable them to ensure that its financial statements complywith the Companies Act 1985. They have general responsibility for taking suchsteps as are reasonably open to them to safeguard the assets of the Group andto prevent and detect fraud and other irregularities.

Under applicable law and regulations, the directors are also responsible for preparing a Directors' Report, Directors' Remuneration Report and Corporate Governance Statement that comply with that law and those regulations.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

REMUNERATION REPORT

The directors present their Remuneration Report for the year ended 31 December 2008. This report sets out the policies under which executive and non-executive directors were remunerated and tables of information showing details of the remuneration and share interests of all the directors.

The report has been approved by the Board and is prepared in accordance withsection 1 of the 2006 Combined Code on Corporate Governance (Combined Code),the Companies Act 1985, as amended by the Directors' Remuneration ReportRegulations 2002 (the Regulations), and the Listing Rules of the FinancialServices Authority.

Shareholders will be provided with an opportunity to vote on the Remuneration Report as set out in this Annual Report at the forthcoming Annual General Meeting to be held on 6 May 2009.

The Regulations require the auditors to report to the Company's shareholders on the information in part II of this report (on pages 36 to 38) and to state whether, in their opinion, those parts of the report have been properly prepared in accordance with the Companies Act 1985 (as amended by the Regulations).

Part I

This part of the Remuneration Report is unaudited.

The Committee

The Remuneration Committee's primary role is to make recommendations to theBoard as to the Company's broad policy and framework for the remuneration ofthe executive directors and the Chairman of the Board and the CompanySecretary. In accordance with the Combined Code the Remuneration Committee alsorecommends the structure and monitors the level of remuneration for the firstlayer of management below Board level. The Remuneration Committee is also awareof and advises on the employee benefit structures throughout the Company andits subsidiaries.

The Remuneration Committee consists of wholly independent non-executive directors, these being during 2008 and at the date of this report, Jonathan Agnew (Chairman), Nigel Cooper and Judy Vezmar. Only members of the Remuneration Committee have the right to attend Remuneration Committee meetings. However, the Chairman of the Remuneration Committee has requested that Scott Forbes, the Chairman of the Board, attends the meetings except during discussions relating to his own remuneration. The Company Secretary acts as the Secretary of the Remuneration Committee and normally attends the meetings.

Ed Williams, the Managing Director, may also be invited to meetings and theRemuneration Committee takes into consideration his recommendations regardingthe remuneration of his executive colleagues and the first layer of managementbelow Board level. No director is involved in any decisions relating to theirown remuneration.

The terms of reference for the Remuneration Committee which are reviewed annually are available on the Company's website at www.rightmove.co.uk/ investors.rsp and are available on request from the Company Secretary.

The Remuneration Committee will meet at such times as may be necessary but normally meets at least twice a year. During 2008 the Remuneration Committee met six times and all members attended all the meetings.

Advice

During 2008, Hewitt New Bridge Street (HNBS) was engaged by the RemunerationCommittee to review the executive director remuneration policy establishedprior to the IPO in 2006 and to assist the Remuneration Committee in itsdetermination of an appropriate future remuneration policy for executivedirectors and senior managers. They have not provided any other services to theCompany.

Review of remuneration arrangements

The remuneration arrangements, which applied to the year under review wereestablished by the Company's original owners prior to the IPO in 2006. Thesearrangements were designed to apply for the first three years following theIPO. As this three-year period has elapsed, the Remuneration Committeecommissioned the independent review by HNBS noted above. This review wasdesigned to provide the Remuneration Committee with relevant market data andguidance on current best practice.

Having considered the HNBS advice and assessed the current needs of the Company, the Remuneration Committee has agreed a remuneration policy and framework that it regards as consistent with the Company's short and medium-term needs and the interests of shareholders.

Remuneration policy

The key principles of the Remuneration Committee's policy are as follows:

* Remuneration arrangements should be designed so as to provide executive

directors with the opportunity to receive a share in the future growth and

development of the Company that is regarded as fair by both other employees

and by shareholders. This approach should allow the Company to attract and

retain the sort of dynamic, self-motivated individuals who believe in and

are critical to the future success of the business; * As far as possible, remuneration arrangements should be simple to understand and administer;

* Executive directors should be principally rewarded for overall success for

which they have collective responsibility; * The Company has key short-term and medium-term strategic goals and executive directors should be incentivised against both sets of goals;

* Executive directors should have a competitive overall remuneration package

comprising below market levels of fixed pay (salary and benefits) and above

market levels of variable pay potential. This arrangement is designed to best align the interests of the executive directors with the interests of shareholders. Remuneration framework

The Remuneration Committee has agreed a framework for 2009 that is designed to complement the policy outlined above. Key features of this framework are as follows:

* No increases in base salary levels;

* No increase in the total expected value of the executive directors' annual

remuneration packages;

* A rebalancing of variable pay potential with a reduced emphasis on share

options and an enhanced emphasis on annual bonus potential - the latter to

be paid in a mixture of cash and deferred shares with any increase in the

amount of the overall bonus entirely in deferred shares; * Annual grants of share options rather than the 'one-off' grant policy adopted at IPO; * A challenging performance condition based on relative Total Shareholder Return (TSR) to be applied to future share option grants.

The principal components of executive directors' remuneration will remain base salary, performance-related bonus and share options as described below.

Base salary

In accordance with the remuneration policy, the base salaries of the executivedirectors have been held (with no increase) at below market levels. The currentsalaries for the executive directors with effect from 1 January 2009 are setout in the table below: Salary Salary year ended 1 January 2009 31 December 2008 Executive directors(1) Ed Williams (Managing Director) £208,884 £208,884 Nick McKittrick £208,884 £208,884 Graham Zacharias £208,884 £208,884

(1) In line with the Company wide salary review, there were no increases to thebasic salaries of the executive directors as at 1 January 2009 (2008: 4.0%).Theexecutive directors' basic salaries made up 5.0% of the Group's basic salarycost in 2008.

Annual performance-related bonus

As noted above, the Remuneration Committee has agreed a rebalancing of the executive directors' variable pay potential for 2009 with a reduced emphasis on share options and an enhanced emphasis on annual bonus potential.

In 2009 the executive directors will be eligible to receive a bonus of 75% ofbase salary in cash with an opportunity of earning up to a further 100% ofsalary (Nick McKittrick) or 125% of salary (Ed Williams) in deferred shares.Shares will be deferred for two years and be potentially forfeitable over thatperiod.The bonus will, as in previous years, be determined principally by profitbefore tax performance with targets set in relation to a carefully consideredbusiness plan and requiring significant out-performance of that plan to triggermaximum payments. However, the Remuneration Committee believes that in thecurrent economic environment the executive directors should also beincentivised to take steps to maintain and develop the Company's marketposition. Accordingly, a significant portion of the bonus will be determined byreference to pre-set targets for key performance indicators such as websitetraffic share and customer retention.Share-based incentivesThe Remuneration Committee believes that it is important for a significant partof the compensation of each executive director to be tied to ownership of theCompany's shares so that each executive's interest in the growth andperformance of the Company is closely aligned with the interests ofshareholders.Executive share options were granted to the executive directors in conjunctionwith the IPO in March 2006. These options are not subject to performanceconditions and will vest as to one-third of the number of option shares on eachof the third, fourth and fifth anniversaries of the date of option grant.The Company has established approved and unapproved executive share optionplans for post IPO grants designed to align employees' interests with thelong-term success of the business. The rules of these plans normally allowawards of options over shares worth up to 200% of salary although up to 400% ofsalary may be granted in exceptional circumstances. Options will becomeexercisable on or after the third anniversary of the date of the grant subjectto satisfactory performance targets being met and will remain exercisable untilten years after the date of the grant. Nick McKittrick received a grant underthese plans in October 2007 with the exercise of these options subject to anearnings per share performance condition.As noted above, starting in 2009, the Remuneration Committee intends to grantannual awards of options to the executive directors under these plans. Due tothe low salaries of the directors relative to market levels and the lack ofgrants each year since the IPO, the Remuneration Committee intends to make agrant above the normal 200% of salary limit with a 400% of salary award toEd Williams and a 300% of salary award to Nick McKittrick. There will be noincrease in the total expected value of the executive directors' annualremuneration packages as a result of this grant and the other changes outlinedin this report.Options will only be exercisable in the event of prior satisfaction of aperformance condition. The Committee believes that an earnings per share growthtarget is the most appropriate type of performance condition for the businessin normal operating conditions. However, given the current market uncertainty,the Committee is not confident in setting an appropriate three-year earningstarget at this time. Consequently for the 2009 grant, the RemunerationCommittee intends to apply a relative TSR performance condition measured over athree year performance period.TSR performance of the Company relative to the FTSE 250 Index % of options exercisable Less than the Index 0% Equal to the Index 25% 25% higher than the Index * 100% Intermediate performance Pro-rata on a sliding scale

* e.g. If the FTSE 250 Index's TSR was 50% over the three-year period, then the Company's TSR would have to be at least 75% for all options to be exercisable.

All existing executive share options can be satisfied from shares held in theRightmove Employees' Share Trust (EBT) without any requirement to issue furthershares. It is intended that the 2009 grant would also be settled from sharescurrently held in the EBT.The non-executive directors do not participate in or benefit from any of theCompany's share incentive or bonus plans except that Scott Forbes receivedPre-admission options in consideration for the work involved in the IPO and inaccordance with his contractual agreement on appointment in 2005.

Executive directors are also eligible to participate in the Company's employee Sharesave scheme. Messrs. Williams, McKittrick and Zacharias have all contributed the maximum amounts permitted under the scheme.

Shareholding requirement

To be consistent with best practice, a formal share ownership guideline will beintroduced for executive directors requiring them to retain at least half ofany future share awards vesting as shares (after selling sufficient shares tomeet the exercise price and to pay tax due on the vesting of the shares) untilthey have a Rightmove shareholding worth at least 200% of salary for theManaging Director and 100% of salary for the other executive directors. Thevalue of the current shareholdings held by the executive directors as apercentage of salary is shown in the table on page 38.

Other benefits

The executive directors are entitled to private healthcare insurance and life assurance cover equal to four times basic annual salary.

Pensions

Until 31 December 2007, the Company operated a stakeholder pension scheme, which was contracted in to the State S2P Pension Scheme. Executive directors were permitted to join the Company's stakeholder plan, however no pension contributions were made by the Company on behalf of employees or directors.

During 2008, the Company launched a new Company stakeholder plan for allemployees with effect from 1 January 2008. The Company contributes 6% of basicsalary (to a maximum of £3,000 each year) subject to the employee contributinga minimum of 3% of basic salary. The executive directors are eligible toparticipate in this arrangement from 1 January 2009.

The Company does not contribute to any personal pension arrangements.

External appointments

With the approval of the Board in each case executive directors may accept oneexternal appointment as a non-executive director of another company and retainany fees received. Graham Zacharias is a non-executive director of Umeco plcand he retains his remuneration for that role. In the year ended31 December 2008, he received fees of £35,000 (2007: £27,500).

Chairman and non-executive directors' fees

The fee levels of the Chairman and the non-executive directors have been reviewed by the Remuneration Committee and the Board respectively and no changes have been proposed to the fee structure for 2009. The non-executive directors' fee levels are within the limits set by the Articles of Association of the Company.

Non-executive directors are entitled to receive £35,000 per annum for theirbasic role and an additional £5,000 fee per annum is paid for the chairing ofthe Audit and Remuneration Committees. Jonathan Agnew is paid a further £5,000fee per annum as Senior Independent Director. Fee Fee year ended 1 January 2009 31 December 2009 Non-executive directors Scott Forbes (Chairman) £90,000 £90,000 Jonathan Agnew (Senior Independent £45,000 £45,000Director) Nigel Cooper £40,000 £40,000 Judy Vezmar £35,000 £35,000 Colin Kemp(1) £35,000 N/A Stephen Shipperley(2) £35,000 N/A

(1) Colin Kemp, non-executive director, is appointed to the Board pursuant to aLetter of Appointment dated 4 December 2007. He was not entitled to receivefees in 2008 but was reimbursed for expenses in accordance with the Company'snormal policy. With effect from 1 January 2009 he will be entitled to a fee of£35,000 per annum in accordance with the fee policy.(2) Stephen Shipperley, non-executive director, is appointed to the Boardpursuant to a Letter of Appointment dated 1 January 2009. With effect from 1January 2009 he will be entitled to a fee of £35,000 per annum in accordancewith the fee policy. His appointment to the Board from the IPO untilDecember 2008 was pursuant to a Relationship Agreement between the Company andConnells Limited. He was not entitled to receive fees but was reimbursed forexpenses in accordance with the Company's normal policy.

Directors' service contracts and non-executive directors' terms of appointment

The Remuneration Committee's policy on service agreements for executivedirectors is that they should provide for 12 months' notice of termination bythe Company and by the executive. Any proposals for the early termination ofthe service agreements of directors or senior executives are considered by theRemuneration Committee.The service agreements for the executive directors (Messrs. Williams,McKittrick and Zacharias) allow for lawful termination of employment by makinga payment in lieu of notice or by making phased payments over any remainingunexpired period of notice. The phased payments may be reduced if and to theextent that the executive finds an alternative remunerated position.Scott Forbes' appointment may be terminated by either party giving to the othernot less than three months' notice in writing. The Company may also terminateby making a payment in lieu of notice. Scott Forbes is not contractuallyentitled to any other benefits on termination of his contract other than inrelation to his share options as described in the table on page 37.

The Letters of Appointment for Jonathan Agnew, Nigel Cooper and Judy Vezmar (the independent non-executive directors) provide for a term of up to two three-year periods (subject to re-election by shareholders) with a notice period of three months on either side and also set out the time commitments required to meet the expectations of their roles. The Letters of Appointment for Stephen Shipperley and Colin Kemp provide that their appointment may be terminated by either party upon three month's written notice. Copies are available for inspection by request to the Company Secretary.

Stephen Shipperley, non-executive director, is Group Executive Chairman ofConnells Limited. His appointment to the Board from the IPO was pursuant to aRelationship Agreement between Connells Limited and the Company which providedConnells Limited with the right to a Board seat conditional upon a 15% or moreshareholding in the Company.

Further details of all directors' contracts are summarised page 35.

Directors' contracts

Date of Date of contract/ Notice Length of appointment letter of (months) service at 27 appointment (4) February 2009 Executive directors Ed Williams 19 December 2000 7 February 2006 12 8 years 2 months(Managing Director) Nick McKittrick (1) 5 March 2004 7 February 2006 12 4 years 11 months Graham Zacharias 17 January 2006 7 February 2006 12 3 years 1 month Non-executive directors Scott Forbes 13 July 2005 21 February 2006 3 3 years 7 months(Chairman) Jonathan Agnew 16 January 2006 12 December 2005 3 3 years 1 month(Senior Independent Director) Nigel Cooper 16 January 2006 12 December 2005 3 3 years 1 month Judy Vezmar 16 January 2006 12 December 2005 3 3 years 1 month Colin Kemp (2) 3 July 2007 4 December 2007 3 1 year 7 months

Stephen Shipperley 30 June 2000 1 January 2009 3 8 years 8 months (3)

(1) Nick McKittrick joined the Company in December 2000 and was appointed tothe Board on 5 March 2004. His service with the Company at the date of this report is 8years and 2 months.(2) Colin Kemp is appointed to the Board pursuant to a Letter of Appointmentdated 4 December 2007. His appointment to the Board from 3 July 2007 to 4December 2007 was pursuant to a Relationship Agreement between the Company andHalifax Estate Agencies Limited.

(3) Stephen Shipperley is appointed to the Board pursuant to a Letter of Appointment dated 1 January 2009. His appointment to the Board from the IPO until December 2008 was pursuant to a Relationship Agreement between the Company and Connells Limited.

(4) The contracts of employment and the Letters of Appointment were transferredfrom Rightmove Group Limited to Rightmove plc with effect from 28 January 2008on completion of the Scheme of Arrangement.

Part II (Audited)

Directors' remuneration

The remuneration of the directors of the Company during the year for time served as a director is as follows:

Basic Pay in lieu 2008(1) Benefits 2008 2007 salary / of notice Bonus in kind total total fees £ £ (3) payable £ £ (2) £ £ Executive directors Ed Williams 208,884 - 66,843 990 276,717 352,814(Managing Director) Nick McKittrick 208,884 - 66,843 709 276,436 334,503 Graham Zacharias(3) 208,884 208,884 66,843 1,214 485,825 352,719 Non-executive directors Scott Forbes 90,000 - - - 90,000 94,575(Chairman) Jonathan Agnew 45,000 - - - 45,000 45,000(Senior Independent Director) Nigel Cooper 40,000 - - - 40,000 40,000 Judy Vezmar 35,000 - - - 35,000 35,000 Colin Kemp(4) - - - - - -

Stephen Shipperley(4) - - - - - - (1) Bonus relates to the accrued payment in respect of the Full Year resultsfor the year ended 31 December 2008. Despite achieving the Group's best everlevel of underlying operating profit (before share-based payments, NationalInsurance (NI) on share options under issue and capital reconstruction costs)in 2008 of £41,004,000, as the Remuneration Committee had set a challengingtarget range by reference to the business plan to trigger maximum bonuspayments, executive directors only received a bonus worth 32% of basic salary.

(2) Benefits in kind for all executive directors relates to private medical insurance.

(3) Pay in lieu of notice relates to the contractual accrued payment payable for pay in lieu of notice and compensation for loss of office on the termination of employment.

(4) Colin Kemp and Stephen Shipperley, non-executive directors, were not paidany fees. They were reimbursed for expenses in accordance with the Company'snormal expense policy.

Directors' interests in options to purchase ordinary shares

Date granted Options Granted Exercise Exercised Price at Lapsed Options Date Expiry held in year price in year date of in held exercisable date 1 exercise year 31 January December 2008 2008 Executive directors

Ed Williams 14/3/2006 7,317 - £4.10 - N/A

- 7,317 One third 13/3/2016 Managing (Approved)

on each of Director) 14/3/2009, 2010 & 2011 15/3/2006 1,981,412 - £3.35 - N/A

- 1,981,412 One third 14/3/2016

on each of (Unapproved) 15/3/2009, 2010 & 2011 2/10/2006 3,648 - £2.59 - N/A - 3,648 1/11/2009 30/4/2010 (Sharesave) 1,992,377 - N/A - N/A - 1,992,377

Nick McKittrick 14/3/2006 7,317 - £4.10 - N/A

- 7,317 One third 13/3/2016 (Approved) on each of 14/3/2009, 2010 & 2011 15/3/2006 987,047 - £3.35 - N/A - 987,047 One third 14/3/2016 (Unapproved) on each of 15/3/2009, 2010 & 2011 10/10/2007 75,000(1) - £5.22 - N/A - 75,000 15/03/2011 9/10/2017 (Unapproved) 2/10/2006 3,648 - £2.59 - N/A - 3,648 1/11/2009 30/4/2010 (Sharesave) 1,073,012 - N/A - N/A - 1,073,012

Graham 14/3/2006 7,317 - £4.10 - N/A - 7,317 One third 13/3/2016Zacharias (Approved) on each of 14/3/2009, 2010 & 2011 15/3/2006 987,047 - £3.35 - N/A - 987,047 One third 14/3/2016 (Unapproved) on each of 15/3/2009, 2010 & 2011 2/10/2006 3,648 - £2.59 - N/A - 3,648 1/11/2009 30/4/2010 (Sharesave) 998,012 - N/A - N/A - 998,012 Non-executive directors

Scott Forbes 15/3/2006 1,738,729 - £3.35 - N/A - 1,738,729(2) One third 14/3/2016(Chairman) (Unapproved) on each of 15/3/2007, 2008 & 2009

(1) These options are exercisable, subject to the basic earnings per share perthe audited consolidated financial statements for the Group for the year ended31 December 2010 being not less than 30p.(2) Pre-admission options granted to the Chairman, Scott Forbes, vest as toone-third of the number of option shares on each of the first, second and thirdanniversaries of the date of the option grant. These options can benefit fromaccelerated vesting if the Chairman's Contract for Services is terminated bythe Company in circumstances not amounting to cause, if he leaves the Companybecause he is not re-elected as a director at the Company's Annual GeneralMeeting, or if he resigns in circumstances that amount to constructivedismissal.

Directors' interests in shares

The interests (both beneficial and family interests) of the directors in office at 31 December 2008 in the share capital of the Company were as follows:

At 31 December 2008 At 31 December 2007 ordinary shares of £0.01 ordinary shares of £0.01 each each Executive directors Ed Williams (Managing 2,407,995 2,407,995Director) Nick McKittrick 129,000 900,000 Graham Zacharias 4,000 895 Non-executive directors Scott Forbes (Chairman) 619,300 619,300 Jonathan Agnew (Senior 30,000 40,298Independent Director) Nigel Cooper 2,820 35,820 Judy Vezmar 31,343 31,343 Stephen Shipperley - - Colin Kemp - -

(1) The issued share capital of the Company (including 2,505,430 shares held in treasury) as at 31 December 2008 comprised 120,050,873 (2007:132,689,361) ordinary shares of £0.01 each.

(2) The mid-market share price of the Company was 464p as at 1 January 2008 andwas 176p as at 31 December 2008. The mid-market high and low share prices ofthe Company were 540p and 160p respectively in the year.(3) The executive directors are regarded as being interested, for the purposesof the Companies Act 1985, in 8,353,700 ordinary shares in Rightmove plccurrently held by the EBT as they are, together with other employees, potentialbeneficiaries of the EBT.

(4) There have been no changes to the above interests between the year end and the date of this report.

The interests of the executive directors in office at 31 December 2008 in theshare capital of the Company in relation to the basic salary were as follows: Basic Number of Value of Value of salary shares held shares at shares as a % at 31 31 December of basic £ December 2008 2008 salary £'000 Executive directors Ed Williams (Managing 208,884 2,407,995 4,238 2,029Director) Nick McKittrick 208,884 129,000 227 109 Graham Zacharias 208,884 4,000 7 3Jonathan AgnewChairman, Remuneration Committee27 February 2009

AUDITORS' REPORT

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF RIGHTMOVE PLC

We have audited the Group and parent Company financial statements (thefinancial statements) of Rightmove plc for the year ended 31 December 2008which comprise the Consolidated Income Statement, the Consolidated and CompanyBalance Sheets, the Consolidated and Company Statements of Cash Flow, theConsolidated and Company Statements of Changes in Shareholders' Equity, and therelated notes. These financial statements have been prepared under theaccounting policies set out therein. We have also audited the information inthe Directors' Remuneration Report that is described as having been audited.This report is made solely to the Company's members, as a body, in accordancewith s235 of the Companies Act 1985. Our audit work has been undertaken so thatwe might state to the Company's members those matters we are required to stateto them in an auditor's report and for no other purpose. To the fullest extentpermitted by law, we do not accept or assume responsibility to anyone otherthan the Company and the Company's members as a body, for our audit work, forthis report, or for the opinions we have formed.

Respective responsibilities of directors and auditors

The directors' responsibilities for preparing the Annual Report, the Directors'Remuneration Report and the financial statements in accordance with applicablelaw and International Financial Reporting Standards (IFRSs) as adopted by theEU are set out in the Statement of Directors' Responsibilities on page 27 and28.

Our responsibility is to audit the financial statements and the part of the Directors' Remuneration Report to be audited in accordance with relevant legal and regulatory requirements and International Standards on Auditing (UK and Ireland).

We report to you our opinion as to whether the financial statements give a trueand fair view and whether the financial statements and the part of theDirectors' Remuneration Report to be audited have been properly prepared inaccordance with the Companies Act 1985 and, as regards the Group financialstatements, Article 4 of the IAS Regulation. We also report to you whether inour opinion the information given in the Directors' Report is consistent withthe financial statements. The information given in the Directors' Reportincludes that specific information that is cross referred from the Principalactivities section of the Directors' Report.

In addition we report to you if, in our opinion, the Company has not kept proper accounting records, if we have not received all the information and explanations we require for our audit, or if information specified by law regarding directors' remuneration and other transactions is not disclosed.

We review whether the Corporate Governance Statement reflects the Company'scompliance with the nine provisions of the 2006 Combined Code specified for ourreview by the Listing Rules of the Financial Services Authority, and we reportif it does not. We are not required to consider whether the Board's statementson internal control cover all risks and controls, or form an opinion on theeffectiveness of the Group's corporate governance procedures or its risk andcontrol procedures.We read the other information contained in the Annual Report and considerwhether it is consistent with the audited financial statements. We consider theimplications for our report if we become aware of any apparent misstatements ormaterial inconsistencies with the financial statements. Our responsibilities donot extend to any other information.

Basis of audit opinion

We conducted our audit in accordance with International Standards on Auditing(UK and Ireland) issued by the Auditing Practices Board. An audit includesexamination, on a test basis, of evidence relevant to the amounts anddisclosures in the financial statements and the part of the Directors'Remuneration Report to be audited. It also includes an assessment of thesignificant estimates and judgments made by the directors in the preparation ofthe financial statements, and of whether the accounting policies areappropriate to the Group's and Company's circumstances, consistently appliedand adequately disclosed.We planned and performed our audit so as to obtain all the information andexplanations which we considered necessary in order to provide us withsufficient evidence to give reasonable assurance that the financial statementsand the part of the Directors' Remuneration Report to be audited are free frommaterial misstatement, whether caused by fraud or other irregularity or error.In forming our opinion we also evaluated the overall adequacy of thepresentation of information in the financial statements and the part of theDirectors' Remuneration Report to be audited.

Opinion

In our opinion:

• the Group financial statements give a true and fair view, in accordance with IFRSs as adopted by the EU, of the state of the Group's affairs as at 31 December 2008 and of its profit for the year then ended;

• the parent Company financial statements give a true and fair view, in accordance with IFRSs as adopted by the EU as applied in accordance with the provisions of the Companies Act 1985, of the state of the parent Company's affairs as at 31 December 2008;

• the financial statements and the part of the Directors' Remuneration Reportto be audited have been properly prepared in accordance with the Companies Act1985 and, as regards the Group financial statements, Article 4 of the IASRegulation; and• the information given in the Directors' Report is consistent with thefinancial statements.KPMG Audit PlcChartered AccountantsRegistered AuditorMilton Keynes27 February 2009 CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2008 Year ended Year ended 31 December 2008 31 December 2007 Note £000 £000 Revenue 2 74,046 56,712 Administrative expenses (34,555)

(30,285)

Operating profit before share-based payments, NI

on share options under issue and capital 41,004 30,746reconstruction costs Share-based payments 24 (1,998) (2,331) NI on share options under 24 240 (298)issue Capital reconstruction 6 245 (1,690)credit/(costs) Operating profit 6 39,491 26,427 Financial income 8 630 891 Financial expenses 9 (1,955) (199) Net financial (expenses)/ (1,325) 692income Profit before tax 38,166 27,119 Income tax expense 10 (12,663) (8,472) Profit for the year 25,503 18,647 Attributable to: Equity holders of the 25,503 18,647Parent

Earnings per share (pence)

Basic 11 22.49 15.16 Diluted 11 22.48 14.19 Dividends per share 12 9.00 5.00(pence) Total dividends 12 10,358 6,176 CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2008 Note 31 December 2008 31 December 2007 £000 £000 Non-current assets Property, plant and equipment 13 1,883 2,042 Intangible assets 14 11,123 7,580 Deferred tax assets 21 164 1,336 Total non-current assets 13,170 10,958 Current assets Trade and other receivables 16 12,627 11,202 Income tax receivable - 163 Cash and cash equivalents 17 23,059 11,807 Total current assets 35,686 23,172 Total assets 48,856 34,130 Current liabilities Bank overdraft 19 (172) - Loans and borrowings 19 (39,750) - Trade and other payables 18 (12,418) (14,714) Income tax payable (5,787) (4,413) Deferred consideration 28 (6,133) - Provisions 20 (13) (130) Total current liabilities (64,273) (19,257) Non-current liabilities Deferred tax liabilities 21 (92) (110) Deferred consideration 28 - (2,328) Provisions 20 - (43) Total non-current liabilities (92) (2,481) Net (liabilities)/assets (15,509) 12,392 Equity Share capital 22 1,201 1,327 Share premium 23 - 105 Other reserves 23 231 - (Deficit)/retained earnings 23 (16,941)

10,960

Total equity attributable to

the equity holders of the (15,509) 12,392Parent

The financial statements were approved by the Board of directors on 27 February 2009 and were signed on its behalf by:

Ed WilliamsDirectorGraham ZachariasDirector COMPANY BALANCE SHEET AS AT 31 DECEMBER 2008 Note 31 December 2008 31 December 2007 £000 £000 Non-current assets Investments 15 537,668 - Total non-current assets 537,668 - Current assets

Trade and other receivables 16 - 50

Cash and cash equivalents 17 17,050 - Total current assets 17,050 50 Total assets 554,718 50 Current liabilities Bank overdraft 19 (172) - Loans and borrowings 19 (39,750) - Trade and other payables 18 (36,828) - Total current liabilities (76,750) - Non-current liabilities

Redeemable preference shares 19 - (50) Total non-current liabilities - (50)

Net assets 477,968 - Equity Share capital 22 1,201 - Other reserves 23 104,271 - Retained earnings 23 372,496 -

Total equity attributable to the equity holders of the 477,968 -Parent

The financial statements were approved by the Board of directors on 27 February 2009 and were signed on its behalf by:

Ed WilliamsDirectorGraham ZachariasDirector CONSOLIDATED STATEMENT OF CASH FLOW FOR THE YEAR ENDED 31 DECEMBER 2008 Note Year ended Year ended 31 December 2008 31 December 2007 £000 £000

Cash flows from operating activities

Profit for the year 25,503 18,647 Adjustments for: Depreciation charges 13 648 503 Amortisation charges 14 452 390 Financial income 8 (630) (891) Financial expenses 9 1,955 129 Share-based payments charge 24 1,998 2,331 Income tax expense 10 12,663 8,472 Operating profit before changes in 42,589 29,581working capital Increase in trade and other (1,462) (8,023)receivables (Decrease)/increase in trade and (2,296) 8,337other payables Decrease in provisions (160) (35) Cash generated from operations 38,671 29,860 Interest paid (1,480) (3) Income taxes paid (net) (9,972) (4,250) Net cash from operating activities 27,219

25,607

Cash flows from investing activities

Interest received 667 891 Acquisition of property, plant and 13 (491) (1,157)equipment Acquisition of intangible assets 14 (464)

(643)

Proceeds from disposal of property, 1

-plant and equipment Acquisition of subsidiary (net of 28 - (3,177)cash acquired) Net cash used in investing activities (287)

(4,086)

Cash flows from financing activities

Dividends paid 12 (10,358) (6,176) Purchase of shares for treasury 23 (11,917)

(19,362)

Purchase of shares for cancellation 23 (32,840)

- Share buy back expenses 23 (287) - New shares issued 23 - 105 Proceeds from borrowings 19 39,750 - Debt issue costs 9 (200) -

Proceeds on exercise of share options -

838

Net cash used in financing activities (15,852)

(24,595)

Net increase/(decrease) in cash and

cash equivalents 11,080 (3,074) Cash and cash equivalents at 11,807 14,8811 January Cash and cash equivalents at 17 22,887 11,80731 December COMPANY STATEMENT OF CASH FLOW FOR THE YEAR ENDED 31 DECEMBER 2008 Note Year ended Period ended 31 December 2008 31 December 2007 £000 £000 Cash flows from operating activities Loss for the period 23 (5,637) - Adjustments for: Financial income (253) - Financial expenses 2,758 - Share-based payments charge 23 1,339 -

Operating loss before changes in (1,793)

-working capital

Decrease/(increase) in trade and 50

(50)other receivables Increase in trade and other 35,602 -payables Cash generated from/(used in) 33,859 (50)operations Interest paid (1,332) - Net cash used in operating 32,527 -activities Cash flows from investing activities Interest received 253 -

Net cash from investing activities 253

- Cash flows from financing activities Dividends paid 12 (10,358) -

Purchase of shares for treasury 23 (11,917)

-

Purchase of shares for cancellation 23 (32,840)

- Share buy back expenses 23 (287) - Proceeds from borrowings 19 39,750 - Debt issue costs 9 (200) -

Issue of redeemable preference -

50shares

Redemption of redeemable preference (50)

-shares

Net cash (used in)/from financing (15,902)

50activities Net increase in cash and cash 16,878 -equivalents Cash and cash equivalents at - -beginning of period Cash and cash equivalents at 17 16,878 -31 December CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE YEAR ENDED 31 DECEMBER 2008 EBT own Reverse Share Share shares Treasury Other

acquisition Retained Total

capital premium reserve shares reserves reserve earnings equityGroup Note £000 £000 £000 £000 £000 £000 £000 £000 At 1 January 1,327 - (17,663) - - - 32,345 16,0092007 Profit for the - - - - - - 18,647 18,647year Dividends to shareholders 12 - - - - - - (6,176) (6,176) Equity settled share options 24 - - - - - - 2,331 2,331 New shares - 105 - - - - - 105issued Purchase of shares for 23 - - - (19,362) - - - (19,362)treasury EBT own shares - - 514 - - - - 514held Gain on exercise of share options - - - - - - 324 324 At 31 December 2007 1,327 105 (17,149) (19,362) - - 47,471 12,392 Capital reconstruction (33) (105) - 19,362 - 138 (19,362) - Profit for the year - - - - - - 25,503 25,503 Equity settled share options 24 - - - - - - 1,998 1,998 Dividends to shareholders 12 - - - - - - (10,358) (10,358) Purchase of shares 23 - - - (11,917) - - - (11,917)for treasury Purchase of own 23 - - - (32,840) - - - (32,840)shares Cancellation of own 23 (93) - - 32,840 93 - (32,840) - shares Share buy back expenses 23 - - - - - - (287) (287) At 31 December 2008 1,201 - (17,149) (11,917) 93 138 12,125 (15,509) COMPANY STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE YEAR ENDED 31 DECEMBER 2008 Reverse Share Treasury Other acquisition Retained Total capital shares reserves reserve earnings equityCompany Note £000 £000 £000 £000 £000 £000At 1 January 2008 - - - - - - Share for share 433,490 - - - - 433,490exchange Capital (432,196) - - 103,520 432,196 103,520reconstruction Loss for the year - - - - (5,637) (5,637) Dividends to 12 - - - - (10,358) (10,358)shareholders Equity settled 24 - - - - 1,339 1,339share options Capital 15 - - 658 - - 658contribution Purchase of shares 23 - (11,917) - - - (11,917)for treasury Purchase of own 23 - (32,840) - - - (32,840)shares Cancellation of own 23 (93) 32,840 93 - (32,840) -shares Share buy back 23 - - - - (287) (287)expenses At 31 December 2008 1,201 (11,917) 751 103,520 384,413 477,968

NOTES FORMING PART OF THE FINANCIAL STATEMENTS

1 General informationRightmove plc (the Company) is a company registered in England (Company no.6426485) domiciled in the United Kingdom (UK). The consolidated financialstatements of the Company as at and for the year ended 31 December 2008comprise the Company and its interest in its subsidiaries (together referred toas the Group). Its principal business is the operation of the Rightmove.co.ukwebsite, which is the UK's largest residential property search website.

The address of the Company's registered office is 4th Floor, 33 Soho Square, London, W1D 3QU.

Statement of complianceThe consolidated and Company financial statements have been prepared andapproved by the directors in accordance with International Financial ReportingStandards (IFRSs) as adopted by the European Union (Adopted IFRSs) and issuedby the International Accounting Standards Board (IASB).

The consolidated financial statements were authorised for issue by the Board of directors on 27 February 2009.

Basis of preparationOn publishing the Company financial statements here together with the Groupfinancial statements, the Company is taking advantage of the exemption in s230of the Companies Act 1985 not to present its individual income statement andrelated notes that form a part of these financial statements.

The accounting policies set out below have been consistently applied to all the periods presented, unless otherwise stated.

The financial statements have been prepared on an historical cost basis.

Going concernThe Group's business activities, together with the factors likely to affect itsfuture development, performance and position are set out in the Business Reviewon pages 4 to 10. The financial position of the Group, its cash flows,liquidity position and borrowing facilities are described on pages 8 to 9. Inaddition Note 4 to the financial statements includes the Group's objectives,policies and processes for managing its capital; its financial risk managementobjectives; details of its financial instruments and its exposures to creditrisk and liquidity risk.The Group has significant cash balances of £23,059,000 at 31 December 2008(refer Note 17). As described inNote 19, the Group entered into a revolving loan facility of up to £40,000,000during the year. As at 31 December 2008 £39,750,000 was drawn down and has beenclassified as current liabilities. At a Board meeting on 25 February 2009, thedirectors confirmed their intention to convert £25,000,000 of the revolvingloan facility into a five year term loan by 17 April 2009 as provided for bythe existing agreement, subject to standard terms and conditions. The directorshave received written confirmation from the Company's bankers that there arecommitted bank funds for the conversion at maturity.The Group's forecasts and projections, taking account of reasonably possiblechanges in performance show that the Group should be able to operate within thelevel of its current facility and related bank covenant requirements.After making enquiries, the directors have a reasonable expectation that theGroup and the Company have adequate resources to continue in operationalexistence for the foreseeable future. Accordingly, they continue to adopt thegoing concern basis in preparing the annual report and accounts.Capital structureThe Company was incorporated and registered in England and Wales on14 November 2007 under the Companies Act 1985 as a private company limited byshares with the name Rightmove Group Limited, registered no. 6426485. TheCompany was re-registered as a public limited company under the nameRightmove Group plc on 29 November 2007. On 28 January 2008 the Company becamethe holding company of Rightmove Group Limited (formerly Rightmove plc,Company no. 3997679) and its subsidiaries pursuant to a Scheme of Arrangement(the Scheme) under s425 of the Companies Act 1985. The shares in the Companywere admitted to trading on the Official List of the London Stock Exchange on28 January 2008 and it immediately changed its name to Rightmove plc. Detailsof the share capital are disclosed in Note 22.This corporate restructure has been accounted for as a reverse acquisition.Therefore, the consolidated financial statements as at and for the year ended31 December 2008 of the Group are prepared as a continuation of the previouslylisted company's consolidated financial statements. The comparative numberspresented in the consolidated financial statements are those reported in theconsolidated financial statements as at and for the year ended 31 December 2007for the previously listed company, Rightmove plc (Company no. 3997679)(subsequently renamed Rightmove Group Limited). The comparative numberspresented for the Company are those of the Company incorporated on14 November 2007.There was no change to the Board of directors, management and corporategovernance arrangements as a result of the Scheme. The consolidated assets andliabilities of the Group immediately after the Scheme were substantially thesame as the consolidated assets and liabilities of the Group immediately priorthereto.Basis of consolidationSubsidiaries are entities controlled by the Group. Control exists when theGroup has the power, directly or indirectly, to govern the financial andoperating policies of an entity so as to obtain benefits from its activities.In assessing control, potential voting rights that are currently exercisable orconvertible are taken into account. The financial statements of subsidiariesare included in the consolidated financial statements from the date thatcontrol commences until the date that control ceases.The minority shareholders of Holiday Lettings Limited (HLL) have a put optionwhich if exercised requires Rightmove Group Limited to purchase their remaining33.3% shareholding in HLL. In accordance with IAS 32, the option for thepurchase of the remaining 33.3% shareholding along with the existing investmentin HLL of 66.7% has been accounted for at a consolidated level as if the Groupholds 100% of the ordinary share capital in HLL and consequently no minorityinterest is recognised. The earliest opportunity HLL management has toexercise the put option is 1 July 2009 based on either a multiple of EBIT perthe audited accounts for the 12 months for the year ended 31 December 2008 orHLL's market value if higher. The impact on the consolidated balance sheet isto recognise a liability of £6,133,000 which is based upon the directors' bestestimate of likely market value for the business. This has resulted in anincrease of £3,531,000 in deferred consideration and a corresponding increasein goodwill. In addition an interest charge of £274,000 has been adjustedagainst deferred consideration in the year as a result of an increase in thepresent value of the liability.Judgments and estimatesThe preparation of financial statements in conformity with Adopted IFRSsrequires management to make judgments, estimates and assumptions that affectthe application of accounting policies and the reported amounts of assets andliabilities, income and expenses. The estimates and associated assumptions arebased on historical experience and various other factors that are believed tobe reasonable under the circumstances. Actual results may differ from theseestimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected.

In particular, information about significant areas of estimation uncertainty and critical judgments in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements is included in the following notes:

Note 10 Utilisation of tax losses

Note 14 Measurement of the recoverable amounts of cash generating units containing goodwill

Note 15 Carrying value of investment in subsidiary

Note 16 Impairment of trade receivables

Note 24 Measurement of share-based payments

2 Significant accounting policies(a) InvestmentsInvestments in subsidiaries are held at cost less any provision for impairmentin the Parent company financial statements.

(b) Intangible assets

(i) GoodwillAll business combinations are accounted for by applying the purchase method.Goodwill represents amounts arising on acquisition of subsidiaries. In respectof business acquisitions that have occurred since 1 January 2004, goodwillrepresents the difference between the cost of the acquisition and the fairvalue of the net identifiable assets acquired.

In respect of acquisitions prior to this date goodwill is included on the basis of its deemed cost, which represents the amount recorded under previous UK Generally Accepted Accounting Principles (GAAP). The classification and accounting treatment of business combinations that occurred prior to 1 January 2004 was not reconsidered in preparing the Group's opening IFRS balance sheet at 1 January 2004.

Goodwill is stated at cost less any accumulated impairment losses. Goodwill isno longer amortised but is tested annually for impairment. This applies to allgoodwill arising both before and after 1 January 2004. IFRS 1 permits goodwillon acquisitions made before this date to be brought on to the balance sheet at1 January 2004 at its carrying value under UK GAAP.(ii) Research and developmentThe Group undertakes research and development expenditure in view of developingnew products and improving the existing property websites. Expenditure onresearch activities, undertaken with the prospect of gaining new technicalknowledge and understanding, is recognised in the income statement whenincurred.Expenditure on development activities, whereby research findings are applied toa plan or design for the production of a new product or substantially enhancedwebsite, is capitalised if the new product or the enhanced website istechnically and commercially feasible and the Group has sufficient resources tocomplete development.The expenditure capitalised includes subcontractors and direct labour.Capitalised development expenditure is stated at cost less accumulatedamortisation and impairment losses. Subsequent expenditure on capitalisedintangible assets is capitalised only when it increases the economic benefitsembodied in the specific asset to which it relates. All other expenditure isexpensed when incurred.(iii) Computer softwareComputer software is capitalised and is stated at cost less accumulatedamortisation and impairment losses. Amortisation is charged from the date theasset is available for use. Amortisation is provided to write off the cost lessthe estimated residual value of the computer software by equal annualinstalments over its estimated useful economic life as follows:

Computer software 20% - 33.3% per annum

(iv) Customer relationships Customer relationships are identified on the acquisition of a business and valued using discounted cash flows based on historical customer attrition rates. Amortisation is expensed in the income statement on a straight line basis over the estimated useful economic life as follows:

Customer relationships 16.7% per annum

(c) Property, plant and equipmentProperty, plant and equipment are stated at cost less accumulated depreciationand impairment losses. Depreciation is provided to write off the cost less theestimated residual value of property, plant and equipment by equal annualinstalments over their estimated useful economic lives as follows:

Office equipment, fixtures & fittings 20% per annum Computer equipment 20% per annum

(d) ImpairmentThe carrying value of the property, plant and equipment is reviewed at eachbalance sheet date to determine whether there is any indication of impairment.If any such indication exists, the asset's recoverable amount is estimated.An impairment loss is recognised for the amount by which the asset's carryingamount exceeds its recoverable amount. The recoverable amount of non-financialassets is the greater of their fair value less costs to sell and value in use.In assessing value in use, the estimated future cash flows are discounted totheir present value using a pre-tax discount rate that reflects current marketassessments of the time value of money and the risks specific to the asset. Foran asset that does not generate largely independent cash flows, the recoverableamount is determined for the cash generating unit to which the asset belongs.Intangible assets that have an indefinite useful life and intangibles which arenot available for use are not subject to amortisation but are tested forimpairment annually and whenever there is an indication that they might beimpaired. An impairment loss is recognised for the amount by which the carryingvalue of the asset exceeds its recoverable amount.Goodwill was tested for impairment at the IFRS transition date; no impairmentwas deemed necessary. An impairment test is performed annually at 31 Decemberon goodwill regardless of the existence of impairment indicators.Investments are assessed for possible impairment when there is an indicationthat the fair value of the investments may be below the Company's carryingvalue. When such a condition is deemed to be other than temporary, the carryingvalue of the investment is written down to its fair value and the amountwritten off is included in net income. In making the determination as towhether a decline is other than temporary, the Company considers such factorsas the duration and extent of the decline, the investee's financial performanceand the Company's ability and intention to retain its investment for a periodthat will be sufficient to allow for any anticipated recovery in theinvestment's market value.(e) Financial instrumentsTrade receivables are recognised at fair value less any impairment loss. Aprovision for impairment of trade receivables is established when there isobjective evidence that the Group will not be able to collect all amounts dueaccording to the original terms of receivables.

Trade payables are recognised at fair value. Trade payables are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date.

All loans and borrowings are initially recognised at cost, being the fair valueof the consideration received net of issue costs associated with borrowings.After initial recognition, loans and borrowings are subsequently measured atamortised cost and any difference between the proceeds and the redemption valueis recognised in the income statement over the period of the borrowings usingthe effective interest method.

(f) Cash and cash equivalents Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand and form an integral part of the Group's cash management are included as a component of cash and cash equivalents for the purpose of the statement of cash flow.

(g) ProvisionsA provision is recognised when the Group has a legal or constructive obligationas a result of a past event and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material,provisions are determined by discounting the expected future cash flows at apre-tax rate that reflects current market assessments of the time value ofmoney and, where appropriate, the risk specific to the liability.A provision is maintained in respect of vacant leasehold properties where thelease is considered to be onerous to take account of the net present value ofresidual lease commitments over the remaining term of the lease.

(h) Employee benefits

(i) PensionsThe Group provides access to a stakeholder pension scheme (defined contributionplan) into which employees may elect to contribute via salary deduction.Obligations for contributions to defined contribution pension plans arerecognised as an employee benefit expense in the income statement when they aredue.(ii) Employee share schemesThe share option programme allows certain senior management employees toacquire shares in the Company.An expense is recognised in the income statement, with a corresponding increasein equity, over the period to which the employees become unconditionallyentitled, on equity settled share-based payment schemes granted after7 November 2002 and which have not vested by 1 January 2005. Awards made beforethis date are not accounted for under IFRS 2, as permitted under thetransitional rules of IFRS 1. For awards made after 7 November 2002 and notvested by 1 January 2005, the charge is based on the fair value of the optiongranted as at the grant date, calculated using an option pricing model.

(iii) Own shares held by The Rightmove Employees' Share Trust (EBT) The EBT is treated as an agent of Rightmove Group Limited and as such EBT transactions are treated as being those of Rightmove Group Limited and are therefore reflected in the Group's consolidated financial statements. In particular, at a consolidated level; the EBT's purchases of shares in the Company are debited directly to equity.

(i) Treasury shares and shares purchased for cancellation When share capital recognised as equity is repurchased, the amount of the consideration paid, including directly attributable costs, is recognised as a deduction from equity. Repurchased shares are either held in treasury or cancelled.

(j) RevenueRevenue principally represents the amounts, excluding value added tax (VAT),receivable from customers in respect of properties advertised on the website.Revenue relating to properties advertised on the website is recognised in themonth to which it relates. Estate agency and Overseas branches are billed inadvance with net revenue deferred until the service commencement date. The VATliability is recognised at the point of invoice. New homes developers aretypically billed monthly in arrears. Where invoices are raised on other than amonthly basis, the amounts are recognised as deferred or accrued revenue andreleased to the income statement on a monthly basis in line with the provisionof services as stipulated in the contract terms. HLL revenue is billed inadvance. The majority of the HLL revenue relates to a 12 month period althoughsome is billed quarterly. This revenue is spread equally over the period withany deferred revenue held on the balance sheet.(k) Segmental reportingA business segment is a distinguishable component of the Group engaged inproviding products and services that are subject to risks and returns that aredifferent from those of other business segments. The Group's primary format forsegmental reporting is by business segment.(l) Foreign currency transactionsTransactions in foreign currencies are translated to the respective functionalcurrencies of Group entities at exchange rates at the dates of transactions.Monetary assets and liabilities denominated in foreign currencies at thereporting date are retranslated to the functional currency at the exchange rateat that date. Foreign currency differences arising on retranslation arerecognised in the income statement.(m) LeasesOperating lease rentals are charged to the income statement on a straight linebasis over the period of the lease. Where cash is received in exchange forentering into a lease with rates above market value, this upfront payment isdeferred and released on a straight line basis over the lease term.(n) Financial income and expensesFinancial income comprises interest receivable on cash balances and deposits.Interest income is recognised as it accrues, using the effective interestmethod.

Financial expenses comprise debt issue costs, preference dividend interest, interest payable on bank loans and the unwinding of the discount on the HLL deferred consideration. Interest payable is recognised on an accruals basis.

(o) TaxationIncome tax on the results for the year comprises current and deferred tax.Income tax is recognised in the income statement except to the extent that itrelates to items recognised directly in equity, in which case it is recognisedin equity.Current tax is the expected tax payable on the taxable income for the period,using tax rates enacted or substantively enacted at the balance sheet date, andany adjustment to tax payable in respect of previous periods.Deferred tax is provided using the balance sheet liability method, providingfor temporary differences between the carrying amounts of assets andliabilities for financial reporting purposes and the amounts used for taxationpurposes. The following temporary differences are not provided for: the initialrecognition of goodwill, the initial recognition of assets or liabilities thataffect neither accounting nor taxable profit other than in a businesscombination and the differences relating to investments in subsidiaries to theextent that they will probably not reverse in the foreseeable future. Theamount of deferred tax provided is based on the expected manner of realisationor settlement of the carrying amount of assets and liabilities, using tax ratesenacted or substantially enacted at the balance sheet date.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised.

In accordance with IAS 12, the Group policy in relation to the recognition oftax on share-based payments is to include the income tax effect of the excesstax deduction in the income statement to the value of the income tax charge onthe cumulative IFRS 2 charge. The remainder of the income tax effect of theexcess tax deduction is recognised in equity.(p) DividendsDividends unpaid at the balance sheet date are only recognised as a liability(and deduction to equity) at that date to the extent that they areappropriately authorised and are no longer at the discretion of the Company.Unpaid dividends that do not meet these criteria are disclosed in the notes tothe financial statements.(q) Earnings per shareThe Group presents basic, diluted and underlying earnings per share (EPS) datafor its ordinary shares. Basic EPS is calculated by dividing the profit or lossattributable to ordinary shareholders of the Company by the weighted averagenumber of ordinary shares outstanding during the period. Diluted EPS isdetermined by adjusting the profit or loss attributable to ordinaryshareholders and the weighted average number of ordinary shares outstanding forthe effects of all potential dilutive instruments, which comprise share optionsgranted to employees. The calculation of underlying EPS is disclosed inNote 11.

3 IFRSs not yet applied

A number of new standards, amendments to standards and interpretations are notyet effective for the year ended 31 December 2008 and have not been applied inpreparing these consolidated financial statements. The standards andinterpretations to be adopted include: Effective date IFRS 8 Operating Segments 1/1/2009 Revised IFRS 2 Share-Based Payments - Vesting Conditions and 1/1/2009Cancellations Revised IFRS 3 Business Combinations (2008) *

1/1/2010

Revised IAS 1 Presentation of Financial Statements (2007)

1/1/2009

Amended IAS 27 Consolidated and Separate Financial Statements 1/1/2010(2008) * * Not yet endorsed by the EU

IFRS 8 Operating Segments introduces the "management approach" to segment reporting and will require a change in the presentation and disclosure of segment information based on the internal reports regularly reviewed by the Group's Chief Operating Decision Maker in order to assess each segment's performance and to allocate resources to them.

Amendment to IFRS 2 Share-Based Payments - Vesting conditions and Cancellationsclarifies the definition of vesting conditions, introduces the concept ofnon-vesting conditions to be reflected in grant date fair value and providesthe accounting treatment for non-vesting conditions and cancellations.

Revised IFRS 3 Business Combinations (2008) incorporates the following changes that are likely to be relevant to the Group's operations:

* The definition of a business has been broadened, which is likely to result

in more acquisitions being treated as business combinations;

* Contingent consideration will be measured at fair value, with subsequent

changes therein recognised in profit or loss;

* Transaction costs, other than share and debt issue costs, will be expensed

as incurred;

* Any pre-existing interest in the acquiree will be measured at fair value

with the gain or loss recognised in profit or loss; * Any non-controlling (minority) interest will be measured at either fair value, or at its proportionate interest in the identifiable assets and liabilities of the acquiree, on a transaction by transaction basis.

Revised IFRS 3, which becomes mandatory for the Group's 2010 consolidated financial statements, will be applied prospectively and therefore there will be no impact on prior years.

Revised IAS 1 Presentation of Financial Statements (2007) introduces the termtotal comprehensive income, which represents changes in equity during a periodother than those changes resulting from transactions with owners in theircapacity as owners. This is expected to have a significant impact on thepresentation of the consolidated financial statements. The Group plans toprovide total comprehensive income in a single statement of comprehensiveincome for its 2009 consolidated financial statements.Amended IAS 27 Consolidated and Separate Financial Statements (2008) requiresaccounting for changes in ownership interests by the Group in a subsidiary,while maintaining control, to be recognised as an equity transaction. When theGroup loses control of a subsidiary, any interest retained in the formersubsidiary will be measured at fair value with the gain or loss recognised inprofit or loss. The amendments to IAS 27, which become mandatory for theGroup's 2010 consolidated financial statements, are not expected to have asignificant impact on the consolidated financial statements.

4 Financial risk management

Overview

The Group has exposure to the following risks from its use of financial instruments:

* credit risk * liquidity risk * market risk This note presents information about the Group and Company's exposure to eachof the above risks, the Group's objectives, policies and processes formeasuring and managing risk, and the Group's management of capital. Furtherquantitative disclosures are included throughout these consolidated financialstatements.The Board of directors has overall responsibility for the establishment andoversight of the Group's risk management framework. The primary method by whichrisks are monitored and managed by the Group is through the monthly ExecutiveManagement Board, where any significant new risks or change in status toexisting risks will be discussed and actions taken as appropriate.The Group's risk management policies are established to identify and analysethe risks faced by the Group, to set appropriate risk limits and controls andto monitor risks and adherence to limits. Risk management policies and systemsare reviewed regularly to reflect changes in market conditions and the Group'sactivities. The Group, through its training and management standards andprocedures, aims to develop a disciplined and constructive control environmentin which all employees understand their roles and obligations.

The Audit Committee oversees how management monitors compliance with the Group's internal controls and reviews the adequacy of the risk management framework in relation to the risks faced by the Group.

Credit riskCredit risk is the risk of financial loss to the Group if a customer fails tomeet its contractual obligations.

The Group's exposure to credit risk is influenced mainly by the individual characteristics of each customer. The Group provides credit to customers in the normal course of business. The demographics of the Group's customer base, including the default risk of the industry and country in which customers operate, has less of an influence on credit risk. The Group provides its services to a wide range of customers in the UK and overseas and therefore believes it has no material concentration of credit risk.

More than 69% of the Group's customers pay via monthly direct debit, minimisingthe risk of non-payment. The Group establishes an allowance for impairment thatrepresents its estimate of incurred losses in respect of trade and otherreceivables based on individually identified loss exposures.Liquidity riskLiquidity risk is the risk that the Group will not be able to meet itsfinancial obligations as they fall due. The Group and Company's approach tomanaging liquidity is to ensure, as far as possible, that it will always havesufficient liquidity to meet its liabilities when due, under both normal andstressed conditions, without incurring unacceptable losses or risking damage tothe Group's reputation.

The Group's revenue model is largely subscription-based which results in a regular level of cash conversion allowing it to service working capital requirements.

The Group and Company ensures that they have sufficient cash on demand to meetexpected operational expenses excluding the potential impact of extremecircumstances that cannot reasonably be predicted, such as natural disasters.As at 31 December 2008, the Group had sufficient cash on demand to meetoperational expenses, before financing activities, for a period of 113 days(31 December 2007: 220 days).As at 31 December 2008 the Group had bank borrowings of £39,750,000, which havebeen classified as current liabilities, however it is anticipated that £25,000,000 will be converted into a long term loan as set out in Note 1 GoingConcern.Market riskMarket risk is the risk that changes in market prices such as foreign exchangeand interest rates will affect the Group's income. The objective of market riskmanagement is to manage and control market risk exposures within acceptableparameters, while optimising the return on risk.Currency risk99% of the Group's sales are Sterling denominated, with the balance being Eurodenominated. As the value of Euro denominated trade receivables is low inrelation to total receivables, no amounts are hedged.Interest rate riskThe Group and Company have interest bearing financial liabilities. The Groupand Company are exposed to interest rate risk on the bank loan facility, cashbalances and the deferred consideration in relation to the acquisition of HLL.Capital managementThe Board's policy is to maintain an efficient balance sheet with anappropriate level of leverage for the size of the business so as to maintaininvestor, creditor and market confidence and to sustain future development ofthe business. The Board monitors the spread of the Company's shareholders, aswell as the return on capital and the level of dividends to ordinaryshareholders.As at 31 December 2008 the directors and senior managers hold 3.4% of theordinary share capital of the Company (excluding shares held in treasury). Inaddition the executive directors are regarded as being interested, for thepurposes of the Companies Act 1985, in 8,353,700 (7.1%) ordinary shares in theCompany currently held by the EBT as they are, together with other employees,potential beneficiaries of the EBT.

The Company purchases its own shares in the market; the timing of these purchases depends on market conditions. In April 2008 the Company entered into a revolving loan facility in order to support its continuing share buy back programme. Of the 11,854,535 shares bought back during 2008, 9,349,105 have been cancelled, with the balance transferred into treasury, providing flexibility for future share option issues.

There were no changes in the Group's approach to capital management during theyear. Neither the Company nor any of its subsidiaries are subject to externallyimposed capital requirements.

5 Segmental reporting

The Group does not have geographical segments with substantially all revenue derived from external operations in the UK in both years. Revenue derived outside the UK is not material in either 2007 or 2008.

All activities in the year relate to the property advertising segment and therewere no other separately identifiable business segment income statement orbalance sheet items.6 Operating profit Year ended Year ended 31 December 2008 31 December 2007 £000 £000

Operating profit is stated after charging/

(crediting):

Depreciation on property, plant and 648

503equipment

Amortisation of computer software 368

327

Amortisation of customer relationships 84

63 Bad debt impairment charge 1,353 318 Operating lease rentals Land and buildings 1,038 691 Other 668 573 Capital reconstruction (credit)/costs* (245)

1,690

* Included in capital reconstruction costs are fees receivable by the auditorsof £nil (2007: £179,000) in respect of other services incurred in connectionwith the capital reconstruction. Following clarification of the VAT treatmenton professional fees incurred in connection with the capital reconstruction

£245,000 was released to the income statement in the current year.

Auditors' remuneration Year ended Year ended 31 December 2008 31 December 2007 £000 £000

Fees payable to the Company's auditors and their associates in respect of the audit Audit of the Company's financial statements 15

131

Audit of the Company's subsidiaries pursuant 115

4to legislation Total audit remuneration 130 135

Fees payable to the Company's auditors in respect of non-audit related services

Tax advisory 20 39 Transaction services 14 179 All other services 13 10

Total non-audit remuneration 47

228

Included in the current year's auditors' remuneration is an amount of £nil (2007: £16,000) relating to the prior year audit and £9,000 (2007: £11,000) relating to finalisation of the prior year tax computation.

7 Employee numbers and costs

The average number of persons employed (including directors) during the year, analysed by category, was as follows:

Group Company Year ended Year ended Year ended Period ended 31 December 31 December 31 December 31 December 2008 2007 2008 2007 Number of Number of Number of Number of employees employees employees employees Administration 346 303 - - Management 14 10 3 - 360 313 3 -

The aggregate payroll costs of these persons were as follows:

Group Company Year ended Year ended Year ended Period ended 31 December 31 December 31 December 31 December 2008 2007 2008 2007 £000 £000 £000 £000 Wages and 15,200 13,130 827 -salaries Social security 1,674 1,145 104 -costs Pension costs 295 1 - - 17,169 14,276 931 -8 Financial income Year ended Year ended 31 December 2008 31 December 2007 £000 £000

Interest income on cash balances 551

891

Interest income on over payment of 79

-taxes 630 8919 Financial expenses Year ended Year ended 31 December 2008 31 December 2007 £000 £000 Debt issue costs 200 - Interest expense 1,367 -

Unwinding of effective interest rate on deferred purchase consideration 274

126 Other financial expenses 113 73 Preference dividend interest 1 - 1,955 19910 Income tax expense Year ended Year ended 31 December 2008 31 December 2007 £000 £000 Current tax expense Current year 11,718 9,272 Prior year adjustment (209) - 11,509 9,272 Deferred tax Origination and reversal of temporary 1,155 (896)differences Reduction in tax rate (1) 96 1,154 (800) Total income tax expense 12,663 8,472

Reconciliation of effective tax rate

The Group's income tax expense for the year is higher (2007: higher) than the standard rate of corporation tax in the UK of 28.5% (2007: 30%). The differences are explained below:

Year ended Year ended 31 December 2008 31 December 2007 £000 £000 Profit before tax 38,166 27,119 Current tax at 28.5% (2007: 30%) 10,877

8,136

Current tax movement in respect of (209)

-prior years Non deductible expenses 859 460 Change in tax rate (1) 96 Small companies relief (2) - Share-based payments 1,252 (322) Deferred tax movement in respect of (113) 102prior years 12,663 8,472

The Group's consolidated effective tax rate for the year ended 31 December 2008is 33% (2007: 31%). The difference between the standard rate and effective rateat 31 December 2008 is attributable mainly to the reversal of the deferred taxasset on share options (3%) and disallowable expenditure (2%).

Income tax recognised directly in equity

Year ended Year ended 31 December 2008 31 December 2007 £000 £000 Deferred tax Tax losses - 689 Current tax Income tax for the year - (689)

Total income tax recognised directly in -

-equity 11 Earnings per share (EPS) Weighted average Earnings Number of shares £000 Pence per share Year ended 31 December 2008 Basic EPS 113,405,224 25,503 22.49 Diluted EPS 113,449,416 25,503 22.48 Underlying basic EPS 113,405,224 27,016 23.82 Underlying diluted EPS 113,449,416 27,016 23.81 Year ended 31 December 2007 Basic EPS 123,023,728 18,647 15.16 Diluted EPS 131,431,538 18,647 14.19 Underlying basic EPS 123,023,728 22,966 18.67 Underlying diluted EPS 131,431,538 22,966 17.47

Weighted average number of ordinary shares (basic)

Year ended Year ended 31 December 2008 31 December 2007 Number of shares Number of shares

Issued ordinary shares at 1 January less ordinary shares held by the EBT 121,046,278

124,054,318

Effect of own shares held in treasury (2,146,388)

(1,242,710)

Effect of own shares purchased for (5,494,666)

-cancellation Effect of share options exercised - 195,890 Effect of new shares issued - 16,230 113,405,224 123,023,728

Weighted average number of ordinary shares (diluted)

For diluted EPS, the weighted average number of ordinary shares in issue isadjusted to assume conversion of all dilutive potential shares. The Company hasone potential dilutive instrument being those ordinary shares held by the EBTto satisfy share options granted to employees. Year ended Year ended 31 December 2008 31 December 2007 Number of shares Number of shares Weighted average number of ordinary shares 113,405,224 123,023,728(basic) Dilutive impact of share options 44,192 8,407,810 113,449,416 131,431,538Underlying EPS is calculated before the charge for share-based payments,capital reconstruction costsand Employer's National Insurance (NI) on share options under issue. Areconciliation of the basic earnings for the year to the underlying earnings ispresented below: Year ended Year ended 31 December 2008 31 December 2007 £000 £000 Basic earnings for the year 25,503 18,647 Share-based payments 1,998 2,331 Capital reconstruction (credit)/costs (245)

1,690

NI on share options under issue (240)

298

Underlying earnings for the year 27,016 22,96612 Dividends

Dividends declared and paid by the Group are as follows:

2008 2007 Pence per £000 Pence per £000 share share 2006 final dividend - - 3.0 3,729paid 2007 interim - - 2.0 2,447dividend paid 2007 final dividend 6.0 7,082 - -paid 2008 interim 3.0 3,276 - -dividend paid 9.0 10,358 5.0 6,176After the balance sheet date a final dividend of 7.0p (2007: 6.0p) perqualifying ordinary share being £7,643,000(2007: £7,119,000) was proposed by the directors. The 2007 final dividend paidon 12 May 2008 was £7,082,000. The difference of £37,000 was due to a reductionin the ordinary shares entitled to a dividend following share buy backs made inthe period between 31 December 2007 and the 2007 final dividend record date of11 April 2008.

No provision was made for the final dividend in either year and there are no income tax consequences.

13 Property, plant and equipment

Office equipment, fixtures & Computer Leasehold Work in Group fittings equipment improvements progress Total £000 £000 £000 £000 £000 Cost At 1 January 2008 771 3,224 8 16 4,019 Transfers - 16 - (16) - Additions 73 394 24 - 491 Disposals - (2) - - (2) At 31 December 2008 844 3,632 32 - 4,508 Depreciation At 1 January 2008 (269) (1,708) - - (1,977) Charge for year (110) (534) (4) - (648) At 31 December 2008 (379) (2,242) (4) - (2,625) Net book value At 31 December 2008 465 1,390 28 - 1,883 At 1 January 2008 502 1,516 8 16 2,042

During the year the development of the new finance billing system was brought into use and so the associated costs have been transferred from work in progress to computer equipment.

Office equipment, fixtures & Computer Leasehold Work in Group fittings equipment improvements progress Total £000 £000 £000 £000 £000 Cost At 1 January 2007 338 2,511 - - 2,849 Acquisitions through business 2 11 - - 13combinations Additions 431 702 8 16 1,157 At 31 December 2007 771 3,224 8 16 4,019 Depreciation At 1 January 2007 (178) (1,296) - - (1,474) Charge for year (91) (412) - - (503) At 31 December 2007 (269) (1,708) - - (1,977) Net book value At 31 December 2007 502 1,516 8 16 2,042 At 1 January 2007 160 1,215 - - 1,375

The Company has no property, plant or equipment in either period.

14 Intangible assets Computer Customer Work in Goodwill software relationships progress TotalGroup £000 £000 £000 £000 £000 Cost At 1 January 2008 6,074 2,359 514 377 9,324 Transfers - 377 - (377) - Additions 3,531 464 - - 3,995 At 31 December 2008 9,605 3,200 514 - 13,319 Amortisation At 1 January 2008 - (1,681) (63) - (1,744) Charge for year - (368) (84) - (452) At 31 December 2008 - (2,049) (147) - (2,196) Net book value At 31 December 2008 9,605 1,151 367 - 11,123 At 1 January 2008 6,074 678 451 377 7,580

During the year the development of the new finance billing system was brought into use and so the associated costs have been transferred from work in progress to computer software.

Computer Customer Work in Goodwill software relationships progress £ TotalGroup £000 £000 £000 000 £000 Cost At 1 January 2007 732 2,093 - - 2,825 Additions 5,342 266 514 377 6,499 At 31 December 2007 6,074 2,359 514 377 9,324 Amortisation At 1 January 2007 - (1,354) - - (1,354) Charge for year - (327) (63) - (390) At 31 December 2007 - (1,681) (63) - (1,744) Net book value At 31 December 2007 6,074 678 451 377 7,580 At 1 January 2007 732 739 - - 1,471

The Company has no intangible assets in either period.

Impairment testing for cash generating units containing goodwill

For the purpose of impairment testing, goodwill is allocated to the Group's operations which represent the lowest level within the Group at which the goodwill is monitored for internal management purposes.

The aggregate carrying amounts of goodwill allocated to each unit are asfollows: 31 December 2008 31 December 2007 £000 £000 Holiday Lettings Limited 8,873 5,342 Rightmove Group Limited 732 732 9,605 6,074The recoverable amount of the HLL cash generating unit was based on its valuein use. Value in use was determined by discounting the estimated future cashflows generated from the business and was based on the following keyassumptions:

* Cash flows were projected based on actual operating results and the three

year business plan

* Cash flows thereafter were extrapolated into perpetuity applying a growth

rate of 3.0% * The key assumption is sales growth rate based on historical growth and future plans for the business

* A pre-tax discount rate of 15.9% was applied in determining the recoverable

amount based on an industry specific weighted average cost of capital

The carrying value of the £732,000 purchased goodwill in Rightmove Group Limited, arising pre-transition to IFRS, is also reviewed annually for impairment. Due to its level of significance the disclosures as required by IAS 36 Impairment of Assets have not been made.

15 Investments

The subsidiaries of the Group as at 31 December 2008 are as follows:

Country of Company Nature of incorporation Holding Class of business shares Rightmove Group Limited Online England and 100% Ordinary advertising Wales Holiday Lettings Limited Online England and 66.7% Ordinary advertising Wales Rightmove.co.uk Limited Dormant England and 100% Ordinary Wales

Rightmove Home Information Packs

Limited Dormant England and 100% Ordinary Wales

All the above subsidiaries are included in the Group consolidated results.

Company 31 December 2008 31 December 2007

Investment in subsidiary undertakings £000

£000 At 1 January - -

Additions in the year - capital 537,010

-reconstruction

Additions - subsidiary equity settled share options charge (see Note 23) 658

- At 31 December 537,668 -

As described within Note 1, Capital structure, Rightmove plc became the new holding company for the Group on 28 January 2008. The increase in the cost of investment of £537,010,000 represents the purchase of 100% of the ordinary shares in Rightmove Group Limited (formerly Rightmove plc).

Following the capital reconstruction in January 2008 all employees' shareoption entitlements were transferred to the new holding company, Rightmove plc.In addition certain directors' contracts of employment were transferred fromRightmove Group Limited to Rightmove plc, whilst all other employees remainedemployed by Rightmove Group Limited. Accordingly the IFRS 2 charge has beensplit in the current year between the Company and Rightmove Group Limited with£658,000 being recognised in the Company accounts as a capital contribution toits subsidiary.

16 Trade and other receivables

Group Company 31 December 2008 31 December 2007 31 December 2008 31 December 2007 £000 £000 £000 £000 Trade receivables 10,194 8,865 - - Less impairment (383) (91) - -provision Net trade 9,811 8,774 - -receivables Amounts owed by related parties 154 333 - -(see Note 27) Other debtors 260 972 - 50 Prepayments and accrued income 2,395 1,079 - - Accrued interest 7 44 - -receivable 12,627 11,202 - 50

Exposure to credit and currency risks and impairment losses related to trade and other receivables are disclosed in Note 29.

17 Cash and cash equivalents

Group Company 31 December 2008 31 December 2007 31 December 2008 31 December 2007 £000 £000 £000 £000 Bank accounts 5,091 11,807 - - Deposit accounts 17,968 - 17,050 - Cash and cash 23,059 11,807 17,050 -equivalents Bank overdraft used for cash (172) - (172) -management purposes Cash and cash equivalents in 22,887 11,807 16,878 -the statement of cash flow

Bank account balances were placed on overnight and one month deposit during the year and attracted interest at a weighted average rate of 4.2% (2007: 5.2%).

At 31 December 2006, as a result of a share capital reduction enforced by a Court Order there was a balance of £3,165,000 held in a blocked trust bank account. At 31 December 2008 this balance was £72,000 (2007: £822,000) and has been reclassified from bank accounts to other debtors. The balance at 31 December 2008 represents operating lease obligations at the date of the Court Order not yet settled.

18 Trade and other payables

Group Company 31 December 2008 31 December 2007 31 December 2008 31 December 2007 £000 £000 £000 £000 Trade payables 1,225 1,696 2 - Inter-group - - 35,600 -payables Accrued interest on inter-group - - 1,226 -payables balance Deferred revenue 6,413 5,894 - - Other taxation and social 2,601 3,300 - -security Trade accruals 2,112 3,215 - - Other creditors 67 609 - - 12,418 14,714 36,828 -

Exposure to currency and liquidity risk related to trade and other payables is disclosed in Note 29.

19 Loans and borrowingsDuring the period, the Company entered into a Sterling-denominated revolvingloan facility of up to £40,000,000 to support its continuing share buy backprogramme. Under the terms of the loan agreement there is an option at maturity(April 2009) for the revolving loan facility to convert into a term loan for afurther five years. The loan bears interest at LIBOR (31 December 2008: 3.28%)plus 1.5% together with a mandatory cost applied by the lender. Fair value Carrying value Fair value Carrying value 31 December 2008 31 December 2008 31 December 2007 31 December 2007 Group £000 £000 £000 £000 Unsecured bank 39,750 39,750 - -borrowings Bank overdraft 172 172 - - Cash and cash equivalents (see (23,059) (23,059) (11,807) (11,807)Note 17) Total net debt/ 16,863 16,863 (11,807) (11,807)(cash)

Analysis of net debt cash flows

At 1 January 2008 Cash flow At 31 December 2008 Group £000 £000 £000 Cash and cash (11,807) (11,252) (23,059)equivalents Interest-bearing loans and borrowings - 39,922 39,922due within one year Total net debt/(cash) (11,807) 28,670 16,863 Fair value Carrying value Fair value Carrying value 31 December 2008 31 December 2008 31 December 2007 31 December 2007 Company £000 £000 £000 £000 Unsecured bank 39,750 39,750 - -borrowings Bank overdraft 172 172 - - Redeemable - - 50 50preference shares 39,922 39,922 50 50 Cash and cash equivalents (see (17,050) (17,050) - -Note 17) Total net debt 22,872 22,872 50 5020 ProvisionsGroup Vacant leasehold property £000 At 1 January 2008 173 Provision utilised in the year

(162)

Provisions made during the year

2 At 31 December 2008 13

Current portion (payable within the next 12

13months) At 31 December 2008 13

The provision for vacant leasehold property relates to the former premisesoccupied by HLL. The provision represents the total future lease and ratepayments over the remaining term of the lease. In determining the provision forthe vacant leasehold property the cash flows have not been discounted as thetime value of money is not significant.

The Company has no provisions in either period.

21 Deferred tax assets and liabilities

Deferred tax assets and liabilities are attributable to the following:

Assets Liabilities Net 31 31 December 31 31 31 31 December 2007 December December December DecemberGroup 2008 2008 2007 £000 2008 2007 £000 £000 £000 £000 £000 Property, (91) (84) (87) (82)plant and 4 2 equipment Tax losses (66) - - - (66) - Provisions (7) - - - (7) - Intangible - - 88 108 88 108assets Equity (1,252) - (1,252)settled - - - share options Net tax (164) (1,336) 92 110 (72) (1,226)(assets) The net deferred tax asset of £72,000 at 31 December 2008 (31 December 2007:£1,226,000) is in respect of intangibles, accelerated capital allowances, taxlosses carried forward and provisions.The deferred tax asset relating to share options at 31 December 2008 is £nil(31 December 2007: £1,252,000). This decrease is due to the Company's shareprice reducing from £4.64 at 1 January 2008 to £1.76 at 31 December 2008.

The Company has no deferred tax assets or liabilities in either period.

Movement in deferred tax during the year:

1 January 2008 Recognised in 31 December 2008Group £000 income £000 £000 Provisions - (7) (7) Property, plant and (82) (5) (87)equipment Intangible assets 108 (20) 88 Tax losses - (66) (66) Equity settled share (1,252) 1,252 -options (1,226) 1,154 (72)

Movement in deferred tax during the prior year:

Arising on Recognised Recognised business 31 DecemberGroup 1 January in income in equity combination 2007 2007 £000 £000 £000 £000 £000 Property, plant and equipment (232) 147 - 3 (82) Tax losses (689) - 689 - - Intangible assets - (15) - 123 108 Equity settled share options (320) (932) - - (1,252) (1,241) (800) 689 126 (1,226)

The deferred tax asset arising on equity settled share options in 2007 was recognised in the income statement to the extent that the related equity settled share options charge was recognised in the income statement.

22 Share capital 31 December 2008 31 December 2007 £000 £000 Authorised

200 subscriber ordinary shares of -

-£0.01 each

5,000,000 non-voting preference shares 50

50of £0.01 each 300,000,000 ordinary shares of £4.00 - 1,200,000each

300,000,000 ordinary shares of £0.01 3,000

-each

Allotted, called up and fully paid 200 subscriber ordinary shares of £ -

-£0.01 each

5,000,000 non-voting preference shares -

50of £0.01 each

120,050,873 ordinary shares of £0.01 1,201

-each

On incorporation, the authorised share capital of the Company was £50,002divided into 5,000,200 ordinary shares of £0.01 each. Of such shares, one wassubscribed by the subscriber to the memorandum of association of the Companyand was paid up in full in cash.

In connection with the Scheme described in Note 1, the following changes to the share capital took place:

(i) On 19 November 2007, a further 199 ordinary shares were allotted by the Company and were paid up in full in cash.

(ii) On 29 November 2007:

the remaining 5,000,000 authorised but unissued ordinary shares of £0.01 eachwere reclassified as non-voting redeemable preference shares of £0.01 each inthe Company (the non-voting preference shares). These shares could be redeemedat any time at the discretion of the directors of the Company or at the requestof the holders upon the earlier of the reduction of capital of the Companybecoming effective or 30 June 2008. Upon such redemption, the Company paid tothe holders the nominal amount paid up on such shares together with all accrueddividend rights;the Company authorised and allotted 5,000,000 non-voting preference shares toTrexco Limited, a company outside of the Group. These shares were deemed to befully paid up to their nominal amount by virtue of Trexco Limited giving anundertaking to pay 5% per annum interest and up to one pence against each shareat a fixed future date. The shares carried no voting rights unless a resolutionto wind up the Company or amend their terms was proposed; andthe two hundred issued ordinary shares of £0.01 each in the capital of theCompany were reclassified as ordinary shares of £0.01 each whose rights were tobe deferred upon the Scheme becoming effective (thesubscriber ordinary shares). These subscriber ordinary shares carried the samevoting rights as ordinary shares in the Company prior to the Scheme becomingeffective.

(iii) On 6 December 2007, the authorised share capital of the Company was increased from £50,002 to £1,200,050,002 by the creation of 300,000,000 ordinary shares of £4.00 each in the Company.

(iv) On 23 January 2008:

(a) the 300,000,000 authorised but unissued ordinary shares of £4.00 each were cancelled; and

(b) the authorised share capital of the Company was increased from £50,002 to £1,005,050,002 by the creation of 300,000,000 ordinary shares of £3.35 each inthe Company .(v) On 28 January 2008, the Scheme became effective and 129,399,978 ordinaryshares were allotted to the former holders of ordinary shares in the capital ofRightmove Group Limited pursuant to the Scheme, credited as fully paid.

(vi) On 30 January 2008:

(a) the paid up share capital of the Company was cancelled to the extent of £3.34 on each ordinary share and the nominal value of each such ordinary sharewas reduced from £3.35 to £0.01; and

(b) the nominal value of each unissued ordinary share was reduced from £3.35 to £0.01.

(vii) On 23 April 2008 the 5,000,000 non-voting preference shares held by Trexco Limited were redeemed and cancelled.

During the period between 1 January 2008 and 31 December 2008, 9,349,105 ordinary shares were bought back by the Group and were subsequently cancelled. Further details are disclosed in Note 23.

23 Reconciliation of movement in capital and reserves

EBT own Reverse Share Share shares Treasury Other acquisition Retained Total capital premium reserve shares reserves reserve earnings equityGroup £000 £000 £000 £000 £000 £000 £000 £000 At 1,327 - (17,663) - - - 32,345 16,0091 January 2007 Profit for the - - - - - - 18,647 18,647year Dividends to - - - - - - (6,176) (6,176)shareholders Equity settled - - - - - - 2,331 2,331share options New shares - 105 - - - - - 105issued Purchase of shares for - - - (19,362) - - - (19,362)treasury EBT own shares - - 514 - - - - 514held Gain on exercise of - - - - - - 324 324share options At 31 December 1,327 105 (17,149) (19,362) - - 47,471 12,3922007 At 1 January 2008 1,327 105 ( 17,149) (19,362) - - 47,471 12,392 Capital reconstruction(33) (105) - 19,362 - 138 (19,362) - Profit for the year - - - - - - 25,503 25,503 Equity settled share - - - - - - 1,998 1,998options Dividends to - - - - - - (10,358)(10,358)shareholders Purchase of shares for treasury - - - (11,917) - - - (11,917) Purchase of own shares - - - (32,840) - - - (32,840) Cancellation of own (93) - - 32,840 93 - (32,840) -shares Share buy back expenses - - - - - - (287) (287)

At 31 December 2008 1,201 - (17,149) (11,917) 93 138 12,125 (15,509)Share buy back

In June 2007, the Group commenced a share buy back programme to purchase its own ordinary shares. The total number of shares bought back in 2008 was 11,854,535 (31 December 2007: 3,289,383) representing 10.1% (31 December 2007:

2.5%) of the issued share capital (excluding shares held in treasury). Of the11,854,535 shares bought back in the year 9,349,105 shares were cancelled and2,505,430 shares were transferred to treasury. The shares were acquired on theopen market at a total consideration (excluding costs) of £44,757,000(31 December 2007: £19,362,000). The maximum and minimum prices paid were 501p(2007: 617p) and 215p (2007: 525p) per share respectively.

EBT own shares reserve

This reserve represents the carrying value of own shares held in the EBT.Further details of this scheme can be found in the Remuneration Report. At theyear end the EBT held 8,353,700 (2007: 8,353,700) ordinary shares in theCompany of £0.01 each representing 7.1% (2007: 6.3%) of the issued sharecapital (excluding shares held in treasury) at 31 December 2008. All sharesgranted are exercisable subject to certain conditions. The market value of theshares held in the EBT at 31 December 2008 was £14,703,000 (2007: £38,761,000). Treasury Other Reverse Retained Share shares reserves acquisition earnings Total capital £000 £000 reserve £000 equityCompany £000 £000 £000At 1 January 2008 - - - - - - Share for share 433,490 - - - - 433,490exchange Capital reconstruction (432,196) - - 103,520 432,196 103,520 Loss for the year - - - - (5,637) (5,637) Dividends to - - - - (10,358) (10,358)shareholders Equity settled share - - - - 1,339 1,339options Capital contribution - - 658 - - 658 Purchase of shares for - (11,917) - - - (11,917)treasury Purchase of own shares - (32,840) - - - (32,840) Cancellation of own (93) 32,840 93 - (32,840) -shares Share buy back - - - - (287) (287)expenses At 31 December 2008 1,201 (11,917) 751 103,520 384,413 477,968Following the capital reconstruction as described in Note 1 Capital structureand the granting of permission by the High C ourt on 30 January 2008, the sharecapital of the Company was reduced in connection with the Scheme by £432,196,000 and converted into distributable retained earnings .Reverse acquisition reserveThis reserve resulted from the acquisition of Rightmove Group Limited by theCompany and represents the difference between the value of the shares acquiredat 28 January 2008 and the nominal value of the shares issued.

24 Share-based payments

The Group and Company operate share incentive schemes for certain senior management comprising the Rightmove Unapproved Executive Share Option Plan (Unapproved Plan) and the Rightmove Approved Executive Share Option Plan (Approved Plan). The Group also operates a Savings Related Share Option Scheme (Sharesave).

The fair value of services received in return for share options granted is measured by reference to the fair value of share options granted. The estimate of the fair value of the services received is measured based on the Black Scholes model. The contractual life of the options is used as an input into this model.

All share incentive schemes are granted under a service condition. Such conditions are not taken into account in the fair value of the services received. There are no market conditions associated with the above grants.

The total Group charge for the year relating to employee share-based paymentplans was £1,998,000(2007: £2,331,000), all of which related to share options granted in 2006, 2007and 2008.

Approved and unapproved plans Full details of the share incentive plans are set out in the Remuneration Report. The assumptions used in the calculation are as follows:

Share Exercise Expected Option Risk Dividend Employee Fair price price volatility life free yield value at (pence) (%) rate turnover per grant (years) (%) date (%) before optionGrant date (pence) vesting (pence) (%) 14 March 413.50 410.00 27 7 4.5 4.0 16.0 92.002006 (Approved) 15 March 413.75 335.00 27 7 4.5 4.0 0.0 116.002006 (Unapproved) 15 March 413.75 335.00 27 6 4.5 3.0 16.0 130.002006 (Unapproved) 12 October 348.00 347.00 27 7 4.5 4.0 16.0 76.002006 (Unapproved) 6 September 613.00 597.00 32 7 5.8 2.0 17.0 228.002007 (Approved) 6 September 613.00 597.00 32 7 5.8 2.0 17.0 181.002007 (Unapproved) 10 October 525.00 522.00 32 6.75 5.8 2.0 17.0 189.002007 (Unapproved) Expected volatility is estimated by considering historic average share pricevolatility at the grant date. 2008 2007 Group Weighted Weighted average average exercise exercise Number price Number price (pence) (pence) Outstanding at 1 January 8,044,439 348.59 8,475,896 336.90 Granted - - 415,161 569.90 Forfeited (739,147) 347.99 (596,618) 342.67 Exercised - - (250,000) 335.00 Outstanding at 31 7,305,292 348.66 8,044,439 348.59December Exercisable at 31 1,075,819 335.00 412,909 335.00December 2008 2007 Company Weighted Weighted average average exercise exercise Number price Number price (pence) (pence) Outstanding at 1 January - - - - Transferred 8,044,439 348.59 - - Forfeited (739,147) 347.99 - - Outstanding at 31 7,305,292 348.66 - -December Exercisable at 31 1,075,819 335.00 - -December Following the capital reconstruction in January 2008 all employees' shareoption entitlements were transferred to the new holding company, Rightmove plc.In addition certain directors' contracts of employment were transferred fromRightmove Group Limited to Rightmove plc, whilst all other staff remainemployed by Rightmove Group Limited. Accordingly the IFRS 2 charge has beensplit in the current year between the Company and Rightmove Group Limited.NI is accrued, where applicable, at a rate of 12.8% on the difference betweenthe share price at the balance sheet date and the average exercise price ofshare options. Based on the share price at 31 December 2008 the accrual builtup in prior periods has been reversed resulting in a credit to the incomestatement of £240,000. The charge for the year ended 31 December 2007 was £298,000.Sharesave optionsThe Group operates an Her Majesty's Revenue and Customs approved Sharesaveoption scheme under which employees are granted an option to purchase ordinaryshares in the Company at up to 20% less than the market price at invitation, inthree years' time, dependent on their entering into a contract to make monthlycontributions into a savings account over the relevant period. These funds areused to fund the option exercise. No performance criteria are applied to theexercise of Sharesave options. The assumptions used in the calculation are asfollows:

Share price Exercise Expected Option Risk Dividend Employee Fair

at grant price volatility life free yield

value

date (pence) (pence) (%) rate turnover per (years) (%) (%) before optionGrant vesting (pence)date (%) 2 345.75 259.00 27 3.25 4.5 3.0 16 108.00October 2006 3 525.00 490.00 32 3.25 5.8 1.5 84 156.00October 2007 2 253.75 255.00 32 3.25 3.0 1.5 25 59.00October 2008 2008 2007 Group Weighted Weighted average average exercise exercise Number price Number price (pence) (pence) Outstanding at 1 311,470 312.93 272,315 259.00January Granted 122,757 255.00 73,102 490.00 Forfeited (159,234) 346.87 (33,947) 261.66 Outstanding at 31 274,993 267.41 311,470 312.93December Exercisable at 31 - - - -December 2008 2007 Company Weighted Weighted average average exercise exercise Number price Number price (pence) (pence) Outstanding at 1 - - - -January Transferred 311,470 312.93 - - Granted 122,757 255.00 - - Forfeited (159,234) 346.87 - - Outstanding at 31 274,993 267.41 - -December Exercisable at 31 - - - -December Following the capital reconstruction in January 2008 all employees' Sharesaveoption entitlements were transferred to the new holding company, Rightmove plc.In addition certain directors' contracts of employment were transferred fromRightmove Group Limited to Rightmove plc, whilst all other staff remainedemployed by Rightmove Group Limited. Accordingly the IFRS 2 charge has beensplit in the current year between the Company and Rightmove Group Limited.

25 Operating lease commitments

Non-cancellable operating lease rentals are payable as follows:

31 December 2008 31 December 2007 Group Plant & Total Plant & Machinery Other Machinery Other Total £000 £000 £000 £000 £000 £000 Less than one 430 978 1,408 504 979 1,483year Between one 294 3,394 3,688 and five years 358 3,591 3,949 More than five - 2,527 2,527 - 3,138 3,138years 724 6,899 7,623 862 7,708 8,570

The Company has no operating lease commitments in either period.

26 Capital commitments

As at 31 December 2008 the Group had committed to incur capital expenditure of £nil (2007: £212,000).

The Company has no capital commitments in either period.

27 Related party disclosures

As at 31 December 2007 there were two principal shareholders, Connells Limitedand Halifax Estate Agencies Limited. Halifax Estate Agencies Limited andConnells Limited sold their remaining interests in the Company in May andDecember 2008 respectively. Consequently as at 31 December 2008, the Companyhas no principal shareholders. The Group's transactions and balances with theseformer shareholders for both years were as follows: Year ended Year endedGroup 31 December 2008 31 December 2007 £000 £000 Amounts owed by: Sequence (UK) Limited (Connells) 55 183 Connells Residential 27 62 Halifax Estate Agencies Limited 72 88 154 333 Amounts invoiced to: Sequence (UK) Limited (Connells) 581

539

Connells Overseas Property Department 2

3 Connells Residential 333 291 Halifax Estate Agencies Limited 638 543 1,554 1,376 Amounts invoiced by: Connells Residential - 34

Included within trade and other receivables is £154,000 due from related parties (31 December 2007: £333,000). Trade and other payables include £nil due to former shareholders (31 December 2007: £nil).

Group Year ended Year ended 31 December 2008 31 December 2007 £000 £000 Dividends paid: Connells Limited 1,912 1,251 Halifax Estate Agencies Limited 974 1,065 2,886 2,316

Inter-group transactions with subsidiaries

During the year the Company was charged interest of £1,226,000 by Rightmove Group Limited in respect of balances owing on the inter-group loan in accordance with a loan agreement dated 30 January 2008.

Directors' transactions

There were no material transactions with directors in either year other thanthose disclosed in the Remuneration Report. Information on the emoluments ofdirectors, together with information regarding the beneficial interest of thedirectors in the ordinary shares of the Company is included in the RemunerationReport on pages 29 to 38.

Transactions with key management staff

There were no transactions in either year with key management staff.

28 Acquisitions and disposals

On 21 March 2007, Rightmove Group Limited acquired 66.7% of the ordinary sharecapital of HLL, a provider of online advertising services to owners of holidayrental properties, for consideration of £3,216,000, including acquisition costsof £73,000. From the date of acquisition to 31 December 2007 the acquisitioncontributed £1,499,000 to Group revenue and £216,000 to Group profit. If theacquisition had been completed on 1 January 2007, the acquisition would havecontributed £1,968,000 to Group revenue and £381,000 to Group profit.

All intangible assets were recognised at their fair values. The residual excess over the net assets acquired is recognised as goodwill in the financial statements. The adjustments applied to the book values of the assets and liabilities of HLL in order to present the net assets at fair values in accordance with Group accounting principles were as follows:

Note Carrying values Fair value pre-acquisition adjustments Fair valuesNet assets acquired £000 £000 £000 Non-current assets Property, plant and equipment 13 12 1 13 Intangible assets - customer 14 - 514 514relationships 12 515 527 Current assets Trade and other receivables 279 (16) 263 Cash and cash equivalents 36 - 36 315 (16) 299 Current liabilities (207) (417) (624) Non-current liabilities Deferred tax liabilities 21 (3) (123) (126) Fair value of net assets 117 (41) 76acquired Purchase consideration - cash 3,213

Purchase consideration - accrued

3expenses Purchase consideration - 2,202deferred Total consideration 5,418 Goodwill 14 5,342Upon acquisition the revenue recognition policy for HLL was changed to align itwith the existing Group policy. Revenue is principally billed annually inadvance. The impact of £422,000 was reflected in current liabilities in 2007 torecognise the deferral of revenue over the 12 month contract on a straight linebasis as opposed to the previous upfront recognition policy.

Included in the £5,342,000 of goodwill recognised were intangible assets that did not meet the definition of intangible assets under IAS 38. These items included an assembled workforce and operating synergies.

Year

ended

31 December

2007

Net cash flow on acquisition £000 Cash paid for subsidiary (3,213) Cash acquired 36 Net cash outflow (3,177)In terms of the shareholders' agreement, a put and call option exists toacquire the remaining 33.3%. The earliest opportunity HLL management has toexercise the put option is 1 July 2009 based on either a multiple of EBIT perthe audited accounts for the 12 months for the year ended 31 December 2008 orHLL's market value if higher. The deferred consideration in the current yearhas been recognised based on the directors' best estimate of likely marketvalue for the business. This has resulted in an increase of £3,531,000 indeferred consideration and a corresponding increase in goodwill.At 31 December 2008, £274,000 (31 December 2007: £126,000) has been charged tofinancial expenses representing the unwinding of the effective interest rate ondeferred consideration. This results in a carrying value of £6,133,000(31 December 2007: £2,328,000) for deferred consideration on the balance sheet.29 Financial instrumentsCredit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting date was:

Group Company 31 December 2008 31 December 2007 31 December 2008 31 December 2007 Note £000 £000 £000 £000 Net trade receivables 16 9,811 8,774 - - Amounts owed by related 16 154 333 - -parties Other debtors 16 260 972 - 50 Accrued interest 16 7 44 - -receivable Cash and cash equivalents 17 23,059 11,807 17,050 - 33,291 21,930 17,050 50

The maximum exposure to credit risk for trade receivables (including related parties) at the reporting date by geographic region was:

Group Company 31 December 2008 31 December 2007 31 December 2008 31 December 2007 Note £000 £000 £000 £000 UK 9,879 9,024 - - Rest of the 86 83 - -world 16 9,965 9,107 - -

The maximum exposure to credit risk for trade receivables (including related parties) at the reporting date by type of customer was:

Group Company 31 December 2008 31 December 2007 31 December 2008 31 December 2007 Note £000 £000 £000 £000 Property 9,229 9,038 - -advertisers Other 736 69 - - 16 9,965 9,107 - -

The Group's most significant customer, a UK house builder, accounts for £ 444,000 of the trade receivables carrying amount at 31 December 2008. In 2007 the Group's most significant customer, a UK estate agent, accounted for £ 401,000 of the trade receivables carrying value.

Impairment losses

The ageing of trade receivables (including related parties) at the reportingdate was: Group Company 31 December 2008 31 December 2007 31 December 2008 31

December 2007

Gross Impairment Gross Impairment Gross Impairment Gross Impairment £000 £000 £000 £000 £000 £000 £000 £000 Not past 4,803 (24) 5,501 - - - - -due Past due 0 - 30 days 2,637 (49) 2,495 (1) - - - - Past due 30 - 60 1,418 (53) 521 (2) - - - -days Past due 60 - 90 596 (67) 451 (2) - - - -days Past due 894 (190) 230 (86) - - - -older 10,348 (383) 9,198 (91) - - - -Credit riskThe movement in the allowance for impairment in respect of trade receivablesduring the year was as follows: Group Company 31 December 2008 31 December 2007 31 December 2008 31 December 2007 £000 £000 £000 £000 At 1 January 91 28 - - Provided during 1,353 91 - -the year Utilised during (1,061) (28) - -the year At 31 December 383 91 - -

The Group has identified specific balances for which it has provided an impairment allowance on a line by line basis across all ledgers, in both years. No general impairment allowance has been provided in either year.

The allowance accounts in respect of trade receivables are used to record impairment losses, unless the Group is satisfied that no recovery of the amount owing is possible; at that point the amounts considered irrecoverable are written off against the financial asset directly.

Liquidity riskThe Group has not entered into any derivative transactions in either year. Thefollowing are the contractual maturities of financial liabilities, includingestimated interest payments: Group Group 31 December 2008 31 December 2007 Carrying Contractual 6 months Carrying Contractual 6 months amount cash flows or less amount cash flows or less £000 £000 £000 £000 £000 £000 Unsecured bank 39,750 (39,750) (39,750) - - -borrowings Trade payables 1,225 (1,225) (1,225) 1,696 (1,696) (1,696) 40,975 (40,975) (40,975) 1,696 (1,696) (1,696) Company Company 31 December 2008 31 December 2007 Carrying Contractual 6 months Carrying Contractual 6 months amount cash flows or less amount cash flows or less £000 £000 £000 £000 £000 £000Unsecured bank 39,750 (39,750) (39,750) - - -borrowings Redeemable - - - preference shares 50 (50) (50) Trade payables 2 (2) (2) - -

- 39,752 (39,752) (39,752) 50 (50) (50)

As described in Note 1 and Note 19 the directors expect £25,000,000 of the bank borrowings to convert into a term loan by April 2009.

Currency riskLess than 1% of the Group's sales are non-Sterling denominated. Throughout theyear the non-Sterling receivables balance has not exceeded £24,000 at any pointin time. As such the Group does not present sensitivity analysis for a movementin the Sterling to Euro exchange rate, nor does the Group undertake any hedgingof foreign currency exposure.

Interest rate risk The Group has exposures to interest rate risk on its cash balances and bank overdraft. As at 31 December 2008 the Group had total cash of £23,059,000 (2007: £11,807,000) and a bank overdraft of £172,000 (2007: £nil).

The Group has exposure to interest rate risk on the revolving loan facility of£39,750,000 which bears interest at LIBOR (31 December 2008: 3.28%) plus 1.5%.A change of 100 basis points in interest rates would have increased ordecreased equity by £196,000.

The Group has exposure to interest rate risk in respect of the financial liability for the deferred consideration payable for the purchase of HLL. At 31 December 2008 the value of this deferred consideration was £6,133,000 (2007: £2,328,000).

Fair values The fair values of all financial instruments in both years are the same as their carrying values disclosed in the notes to the financial statements.

Group Group 31 December 2008 31 December 2007 Carrying Fair value Carrying Fair value amount £000 amount £000 £000 £000 Trade and other 12,627 12,627 11,202 11,202receivables Cash and cash 23,059 23,059 11,807 11,807equivalents Bank overdraft (172) (172) - - Trade and other (12,418) (12,418) (14,714) (14,714)payables Loans and (39,750) (39,750) - -borrowings (16,654) (16,654) (8,295) (8,295) Company Company 31 December 2008 31 December 2007 Carrying Fair value Carrying Fair value amount £000 amount £000 £000 £000 Trade and other - - 50 50receivables Cash and cash 17,050 17,050 - -equivalents Bank overdraft (172) (172) - - Trade and other (36,828) (36,828) - -payables Loans and borrowings (39,750) (39,750) - - Redeemable preference shares - - (50) (50) (59,700) (59,700) - -30 Contingent liabilitiesThe Group and the Company had no contingent liabilities in either year.

ADVISERS AND SHAREHOLDER INFORMATION

Contacts Registered Corporate office advisers Managing Director: Ed Williams Rightmove plc Financial adviser Chief Operating Nick McKittrick 4th Floor UBS Investment Officer and Bank Finance Director: Company Secretary: Liz Taylor Soho Square Joint broker Website www.rightmove.co.uk London UBS Limited Email [email protected] W1D 3QU Numis Securities Limited Registered in Auditor England no. KPMG Audit Plc 6426485 Financial calendar Bankers 2009 2008 full year 27 February 2009 Barclays Bank results plc Final dividend 15 May 2009 Bank of record date Scotland plc Annual General 6 May 2009 Solicitors Meeting Final dividend 12 June 2009 Slaughter and payment May Interim Management May, November 2009 Pinsent Masons Statement Half year results August 2009

Registrar

Interim dividend November 2009 Capita Resgistrars* *Shareholder enquiries

The Company's registrar is Capita Registrars. They will be pleased to deal withany questions regarding your shareholding or dividends. Please notify them ofyour change of address or other personal information. Their address details

are:Capita RegistrarsPO Box 1269HuddersfieldHD19UT

Capita Registrars is a trading name of Capita Registrars Limited

Capita shareholder helpline: 0870 664 0300 (calls cost 10p per minute plus network extras) (overseas: +44 20 8639 3367) Email [email protected]

To register for e-communications please log on to the Capita Registrars website at www.capitaregistrars.com/shareholders and follow the instruction to the share portal.

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Related Shares:

Rightmove