Half Yearly Report

6 August 2013

SDL PLC

Interim results for the six months ended 30 June 2013

A period of significant transformation, enhancing our capabilities to deliver solutions for Customer Experience Management

SDL plc ("SDL", "the Group" or the "Company"), a leader in Customer Experience Management solutions, announces its unaudited interim results for the six months ended 30 June 2013.

Operational Summary:

·; Performance in line with revised outlook

·; Revenue performance across the four segments (underlying constant currency):

o Content Management Technologies down 0.7%

o Language Technologies down 9.0%

o Global Solutions (formerly Language Services) down 3.2%

o Campaign Management, Analytics & Social Intelligence down 15.3%

·; Geographically, headline growth in Continental Europe up 4%, Americas and Asia Pacific down 6% and 4% respectively

·; New customer wins in the period include: Tekla Corporation, Edwards Life Sciences, Bank of Finland, Amalgamated Banks of South Africa, Provident Insurance plc and Amerigroup Corporation

·; Several key product launches further strengthened SDL's leadership in Customer Experience Management

·; Completed strategically important acquisition of Bemoko, a mobile solution extending SDL's Customer Experience Management offering

·; Progress made to strengthen SDL's executive team, through appointments of:

o Chief Marketing Officer

o Global Head of HR

·; Our transformation programme remains on track and we are making headway to deliver a more robust platform for future growth adding 85 new (65 net) sales and marketing staff

Mark Lancaster, Chief Executive Officer, commented:

"Although investments are taking longer to deliver bookings growth than originally anticipated, we are starting to see pipeline improvements on both the technology and services side. We expect to benefit from cost savings following systems investments and substantial structural improvements in the latter half of the calendar year, with a more pronounced impact in 2014.

"We are taking a cautious view for the remainder of this financial year on the speed of recovery in Services volume and Technology licence sales growth. We believe the investments we are making to address future business opportunities will unlock the intrinsic value within SDL to deliver our technology products and services. As we enter the second half, our guidance for 2013 remains unchanged and the Board remains confident in the Company's strategy and ability to deliver shareholder value in the longer term."

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About SDL

SDL enables global businesses to enrich their customers' experience through the entire customer journey. SDL's technology and services help brands to predict what their customers want and engage with them across multiple languages, cultures, channels and devices.

SDL has over 1,500 enterprise customers, 400 partners and a global infrastructure of 70 offices in 38 countries. 42 out of the top 50 brands work with SDL. For more information, visit www.sdl.com.

All trademarks are the property of their respective owners.

Chairman's Statement

I am pleased to submit my first report to shareholders since taking over as Chairman of SDL at the beginning of July. The Group has clearly made great strides during the period to strengthen the Executive team and to scale its sales and marketing capabilities, which has improved the pipeline for both the services and technology businesses. I am looking forward to continuing to provide consistent and stable board leadership that will enable us to build on that success.

Having joined the Board as a Non-executive Director in December 2009 and been Senior Independent Director (SID) since April 2012 I bring an in-depth knowledge of the Group's mission, vision and values, and will continue to work closely with Mark Lancaster, Chief Executive Officer, and the SDL Board to achieve our goals.

Trading

The first half of 2013 has been a challenging period, with a combination of market conditions, legacy sales and marketing issues and planned investments resulting in a profit before tax, amortisation and one-off historic litigation costs for the period of £2.8 million (2012: £20.8 million) and a loss before tax of £2.3 million (2012: profit of £16.4 million). Whilst below last year, performance was in line with the revised outlook provided in the Trading Update of 18 June 2013.

The business has already made substantial structural improvements that include the hiring of a Chief Marketing Officer, a Global Head of Human Resources and 65 new sales and marketing staff. Some key product launches, particularly in the Content Management Technologies and Campaign Management, Analytics and Social Intelligence segments, have further strengthened SDL's leadership in Customer Experience Management.

Governance and the Board

We have an experienced and diverse Board, supported by a strong executive team. We are working hard to put in place effective succession and development programmes and this will continue to be an important area of focus for me. We expect to further strengthen our capabilities in both areas in the coming months.

The Company is run in an open and transparent manner, consistent with its stated values. Effective governance means managing our business well and engaging well with our stakeholders. It is never simply an exercise in compliance, but a key element underpinning the long-term growth of our business. As such, it is of key importance in these recent challenging times.

I chair the Board at a critical stage in the Group's development. Having made significant investments in acquisitions in recent times, it has been imperative that we invest in our existing infrastructure to fully exploit the value of those acquisitions. I am confident the Group will continue to benefit from its continued commitment to research and development, clear, well executed operational plans and strong management. The Board remains confident in the Group's strategy and ability to deliver shareholder returns in the longer term.

David Clayton

Chief Executive Officer's statement

Summary Performance

The Group's performance in the first half was in-line with the Board's revised expectations. Revenues were £131.0 million (2012: £133.6 million). Profit before taxation, amortisation of intangible assets ("PBTA") and Trados litigation costs of £1.3 million was £2.8 million (2012: £20.8 million). The decrease is due to the planned additional sales and marketing investments incurred in the first half of 2013 of £6.3 million and weaker revenue performance. Gross cash in the business at the half year was £20.6 million (31 December 2012: £28.5 million) and net cash after borrowings was £0.6 million (31 December 2012: £6.3 million).

Headline revenue decreased by 2.0%, attributable to an organic reduction of 4.4%, and foreign currency and acquisition effects of +0.8% and +1.6% respectively. Geographically, revenue growth in Continental Europe was strongest at +4%. Revenue was down on the prior year in the Americas at -6% and Asia Pacific at -4% and up in the UK at +1%.

The cash generated from operations was £9.5 million, an improvement of £2.5 million, reflecting stronger working capital management during the period. Capital expenditure was £5.1 million (2012: £2.4 million) due to increased investment in SaaS cloud infrastructure. Tax paid was £4.8 million (2012: £4.2 million), above the profit and loss tax charge due to prior year taxes and the deferred tax credit for intangible asset amortisation.

With regard to the ongoing Trados litigation, the Board will continue to monitor the situation. A Delaware court judgement is imminently expected and shareholders will be kept informed of material developments.

At the start of the year, the Group embarked on a major sales and marketing investment programme to achieve a step change in sales and marketing execution capacity and to capitalise on our technology portfolio, providing businesses with solutions for Customer Experience Management. The Group remains focused on strategic investments for the future of the business.

Key wins in the period include Tekla Corporation, Edwards Life Sciences, Bank of Finland, Amalgamated Banks of South Africa, Provident Insurance plc and Amerigroup Corporation. CXM deals include Bose Europe, Wolters Kluwer and eBay.

First Half Investment Programme Highlights include:

·; Planned hiring milestones for sales and marketing have been achieved, with the recruitment of 65 additional sales and marketing resources across Europe and North America. With the resources now in place, we expect to see the impact of these investments in the second half of 2013, as per our plan.

·; We have strengthened the executive team with the appointment of Grant Johnson, formally from Pegasus Systems, into the position of Chief Marketing Officer and Roddy Temperley as Global Head of Human Resources, who came to us from Credit Suisse and prior to that SAP.

·; We made significant investments in our technology platform throughout 2012 to create an integrated technology platform which we showcased at SDL Innovate. Released components of this platform in 2013 were

̵ Social Intelligence Customer Commitment Framework

̵ Freetranslation.com, our integrated machine and human translation platform

̵ Integrated Marketing suite with new architecture and scale capabilities

̵ Media Manager enterprise edition

·; In Global Solutions (formerly Language Services), new workflow efficiency technology and process improvements. This is ahead of schedule and we expect to deliver considerable savings in Q4 2013.

·; Sales, marketing and systems infrastructure investments are being made to deliver SDL's technology products and services into the Customer Experience Management market.

·; IT infrastructure in Human Resource and Financial Consolidation systems as well as increased IT infrastructure for Machine Translation, Internal Systems and Data centres.

·; Most importantly we are seeing pipeline improvement on both the technology and services side with licence bookings expected to increase significantly in the second half.

·; The cost of this programme remains on target at £10 million in 2013.

Performance by Segment

The Group is organised into business units based on products and services, and has four reportable segments.

Content Management Technologies(contributing £29.3 million or 22% revenue to the Group and £1.8 million PBTA) (2012: contributing £28.7 million or 21% revenue to the Group and £5.2 million PBTA).

This segment includes Web Content Management Solutions, eCommerce Technologies and Structured Content Technologies. Total segment revenues grew by +2.2%, attributable to an organic reduction of -0.7%, foreign currency effects of +0.9% and the acquisition impact of the Alterian Web Content business of +2.0%. Licence revenue increased by 3% in the period, reflecting significantly improved performance in Structured Content Technologies partly offset by weaker Web Content Management. Demand in eCommerce was strong, with revenue growth of 24% in the period. PBTA margin was 6.0% (2012: 18.0%), the like-for-like fall reflecting the significant planned investments across all regions to expand sales and marketing, partnership and alliance management and customer account management.

During the period, we made a small but strategically significant acquisition of Bemoko, a UK Company in the Mobile Web Solutions space. This technology enhances the Group's existing capabilities to provide an improved delivery tier for web content to any device, enabling Customer Experience solutions to be individually tailored around the types of content that customers want when they are mobile.

We have continued to invest in SDL's Global Multinational Alliances and Partners programme to promote Customer Experience Management solutions with other leading design, consulting or technology organisations, including Sapient, Capgemini and HintTech. Building on business already developed through this programme, partnerships and alliances are expected to contribute an increasing share of future revenues.

Forrester Research has once again acknowledged SDL as a leader in Web Content Management for Digital Customer Experience, and we are particularly pleased to have achieved the highest score in both the Experience Management and Current Offering categories, affirming SDL's vision and technology leadership.

Language Technologies (contributing £17.9 million or 14% revenue to the Group and a PBTA loss of £-2.1 million) (2012: contributing £19.5 million or 15% revenue to the Group and PBTA of £1.9 million).

This segment includes Desktop products, Language Technology Enterprise Products and Machine Translation. Total segment revenues were behind 2012 by -8.4%, following an organic decline of -9.0% and foreign exchange effects of +0.6%. The PBTA loss was -11.5% (2012: profit of 9.7%), due to a combination of reduced software licence sales, a reduction in US Government revenues and planned investment in sales and marketing associated with Machine Translation technologies.

A number of new SDL BeGlobal translation productivity customers have been won in the first half, which has contributed towards more than doubling the number of SaaS units sold for this product.

Global Solutions (contributing £73.4 million or 56% of Group revenue and £6.9 million PBTA) (2012: contributing £75.2 million or 56% of Group revenue and £14.2 million of PBTA).

Total segment revenues reduced by -2.4%, attributable to an organic reduction of -3.2% and foreign currency effects of +0.8%. This is primarily due to the poor macroeconomic climate, which has led to some repeat customers reducing their volumes. No increased pricing pressure has been experienced.

We continue to invest in improving our infrastructure, including expanding the use of automated translation technology, new workflow efficiency tooling and other productivity improvement projects. Adoption of the Intelligent Machine Translation (iMT) solution across the customer base has increased from 16% to 20%. Linked to these initiatives, during the period we have grown our presence in Poland and India by approximately 60 heads. We have also established a new translation network office in Ho Chi Minh in Vietnam, leveraging the established presence of a technology division in this country.

Campaign Management, Analytics & Social Intelligence (contributing £10.4 million or 8% of Group revenue and a PBTA loss of £-3.8 million) (2012: contributing £10.2 million or 8% of Group revenue and £0.2 million PBTA).

This segment comprises marketing analytics, campaign management and social intelligence technologies, the main components of the 2012 Alterian acquisition.

Software licence bookings and revenue in the period have resulted in an organic decline in total segment revenues of -15.3%, with acquisition effects of +16.4% and foreign currency effects of +1.2% resulting in overall growth of +2.3%. PBTA margin was -36.5% (2012: 2.4%), having made significant planned investments in sales and marketing and software development.

During the period we released the SDL Intelligent Marketing Suite which includes our core analytics, campaign and email management as a single integrated platform, to enable marketers to build entire campaign strategies based on individual customer journeys, tailored to the unique factors influencing their markets. This platform includes sophisticated in-built integrations with other SDL products including SDL Tridion web content management and SDL Media Manager for the deployment of video and other rich media content. 20 customers are already live on the new product following the launch in March 2013.

We released the SDL Customer Commitment Dashboard, a predictive intelligence tool for business leaders wishing to drive Customer Experience Management programmes. By leveraging captured social media conversations, and SDL's patented Customer Commitment Framework, a series of predictive measures are presented in a simple and intuitive online executive dashboard. This delivers a near real-time predictive view of customer journey experiences, enabling organisations to continually optimise their engagement strategies based upon real customer insights.

Customer Experience Management strategy

The last 12 months have seen considerable consolidation of niche Content Management, Analytics/Social and marketing businesses, with a number of the larger players in the Software industry acquiring similar technology to that of SDL to address the fast evolving Customer Experience Management market.

We believe SDL is well positioned to address this opportunity, having acquired similar businesses some years ago, and, over the last three years, integrated the technology of those businesses together. While we have lagged behind through lack of marketing and sales investment and delivery of a holistic sales process and marketing message, we have been addressing this in 2013. As we move through the latter part of the year we will not only have the product, but also the sales and marketing infrastructure to deliver financial returns. We are very encouraged by the initial direct market response we have had when showcasing our integrated technology stack at SDL Innovate as well as direct feedback from our customers and new prospects. Possibly most importantly, we see the industry analysts and new prospects as well as the competition responding well to Customer Experience Management solutions.

Outlook and Current Trading

Sales momentum from the previous year was below our expectations and investments are taking a little longer to come through than we anticipated. Our pipeline is increasing as a result of our planned investments, and we expect to see cost savings on account of systems and structural investments in the latter half of the calendar year.

Whilst the Board has taken a more cautious view regarding the speed of services volume recovery and licence sales growth, the Board is convinced that making the additional major investments in sales, marketing and structure will unlock the intrinsic value of the intellectual property, customer base and infrastructure within SDL to deliver our technology products and services. We are confident these investments will not only return SDL to its historical trends of high growth and consistent profitability, but will create a Group that will allow us to fully realise our technology investments.

Our guidance for 2013 remains unchanged and the Board remains confident in the Group's strategy and ability to deliver shareholder value.

Mark Lancaster

Chief Executive Officer

SDL plc

6 August 2013

SDL plc

Interim Condensed Consolidated Income Statement

Adjusted earnings per ordinary share (basic and diluted) are shown in note 6.

SDL plc

Interim Condensed Consolidated Statement of Comprehensive Income

All the total comprehensive income is attributable to equity holders of the parent Company. A currency translation difference on a foreign operation may be reclassified to the Income Statement upon disposal of that operation. There are no other items included in Other Comprehensive Income that may be reclassified to the Income Statement in the future.

SDL plc

Interim Condensed Consolidated Statement of Financial Position

The Interim Financial Information presented in this Interim Report was approved by the Board of Directors on 6 August 2013.

SDL plc

Interim Condensed Consolidated Statement of Changes in Equity

These amounts are attributable to equity holders of the parent Company.

SDL plc

Interim Condensed Consolidated Statement of Cash Flows

SDL plc

Interim Condensed Consolidated Statement of Cash Flows

SDL plc

Notes to the Interim Condensed Consolidated Financial Statements

1. Basis of preparation and accounting policies

Basis of preparation

The annual financial statements of the Group are prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU. The interim condensed consolidated financial statements for the six months ended 30 June 2013 have been prepared on a going concern basis in accordance with IAS 34 Interim Financial Reporting.

As required by the Disclosure and Transparency Rules of the Financial Services Authority, the condensed set of financial statements has been prepared applying the accounting policies and presentation that were applied in the preparation of the Company's published consolidated financial statements for the year ended 31 December 2012.

The preparation of condensed consolidated interim financial statements in conformity with IFRSs requires management to make judgements, estimates and assumptions that affect the application of accounting policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results for which form the basis of making the judgements about carrying values of assets and liabilities that are not readily available from other sources. Actual results may differ from these estimates.

The principal risks and uncertainties were disclosed in the Group's annual report and financial statements for the year ended 31 December 2012 and remain broadly unchanged. SDL has an established process both to manage risk and to seek to mitigate the impact of risk as much as possible should it materialise. Operational risks include management succession, system interruption and business continuity, data protection, compliance, contract management, integration of acquisitions, maintaining technology leadership and intellectual property. Financial risks include liquidity, counterparties, interest rates and financial reporting.

Going Concern

In line with code requirements the Directors have made enquiries concerning the potential of the business to continue as a going concern. Enquiries included a review of performance in 2013, 2013 annual plans, a review of working capital including the liquidity position and a review of current indebtedness levels. The Directors confirm they have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Given this expectation they have continued to adopt the going concern basis in preparing the interim financial statements.

2. Business Combinations

Acquisition of Bemoko Consulting Limited

On 8 February 2013, the Group acquired 100% of the share capital of Bemoko Consulting Limited, an unlisted company based in the United Kingdom. The principal activity of Bemoko Consulting Limited is the provision of mobile solutions.

The total cost of the combination comprises £2.2 million of which £1.4 million was funded from the Group's existing cash resources and £0.8 million of contingent consideration will be settled in shares.

The provisional values of the identifiable assets and liabilities of Bemoko Consulting Limited as at the date of acquisition were:

The maximum contingent consideration is £0.8 million. The fair value was calculated at £0.8 million and under IFRS 3 (revised) any re-measurement will be recognised in the income statement.

From the date of acquisition, Bemoko Consulting Limited has contributed £0.1 million of revenue and a loss of £0.1 million to the net loss after tax of the Group. If the combination had taken place at the beginning of the year, the loss for the Group would have been £1.3 million and revenue from continuing operations would have been £131.1 million. Included in the £1.3 million of goodwill recognised above are certain intangible assets that cannot be individually separated and reliably measured from the acquired business due to their nature. These items include the assembled workforce.

3. Segment information

The Group operates in the Customer Experience Management industry. For management purposes, the Group is organised into business units based on their products and services and has four reportable operating segments as follows:

·; The Global Solutions (formerly referred to as Language Services) segment is the provision of a translation service for customer's multilingual content in multiple languages.

·; The Language Technologies segment is the sale of enterprise, desktop and statistical machine translation technology developed to help automate and manage multilingual assets together with associated consultancy and other services.

·; The Content Management Technologies segment is the sale of content management technologies developed to help automate and manage content to deliver a consistent, interactive and personalised customer experience, in multiple languages, across websites, documentation, multiple media and channels.

·; The Campaign Management, Analytics and Social Intelligence segment is the sale of campaign management, social media monitoring and marketing analytic technology together with associated consultancy and services.

Management monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment prior to charges for tax and amortisation.

Six months ended 30 June 2013 (unaudited)

The following segmental analyses have been restated for historic litigation costs incurred in the prior year for consistency with current year presentation.

Six months ended 30 June 2012 (unaudited) - restated

Twelve months ended 31 December 2012 (audited) - restated

Segment assets:

(1) Segment assets do not include cash (£20,584,000), Corporation Tax (£1,926,000) and Deferred Tax (£4,606,000).

(2) Segment assets do not include cash (£16,717,000), Corporation Tax (£1,106,000) and Deferred Tax (£7,192,000).

(3) Segment assets do not include cash (£28,452,000), Corporation Tax (£1,206,000) and Deferred Tax (£4,395,000).

Revenue by geographical destination was as follows:

4. Operating (loss) / profit

5. Taxation

A tax credit in respect of foreign currency translation differences on foreign currency loans to foreign subsidiaries of £206,000 was recognised in the statement of other comprehensive income in the six months to June 2013 (June 2012: £150,000; December 2012: £115,000).

A tax credit in respect of share based compensation for current taxation of £nil (June 2012: £355,000; December 2012: £549,000) has been recognised in the statement of changes in equity in the period. A tax charge in respect of share based compensation for deferred taxation of £nil (June 2012: £180,000; December 2012: credit of £242,000) has been recognised in the statement of changes in equity in the period.

Due to the requirements of IAS 12, in conjunction with IFRS 2, the Schedule 23 tax credit for share options exercised and deferred taxation on unexpired options have partly been recorded in equity. For the 6 months ended 30 June 2013 this has had no impact on the effective tax rate (at 30 June 2012: +1.1%; at 31 December 2012:-0.6%).

6. Earnings per share

7. Dividend per share

Dividends paid in the six months ending 30 June 2013 were £4,894,663 (June 2012: £4,637,540; December 2012: £4,637,540). The dividend paid amounted to 6.1 pence per ordinary share (2012: 5.8 pence per share).

8. Interest-bearing loans

During the period, the Group repaid £2.2 million, being the amount outstanding at 31 December 2012 on the Group's £7 million facility. On 28 June 2013, the Group entered into a new £30 million facility with Royal Bank of Scotland replacing the Group's £20 million facility (fully drawn) and the Group's £7 million facility (undrawn). This increases the Group facility by £3 million. This new facility expires in September 2015 and the amount drawn at 30 June 2013 was £20 million.

9. Share-based payments

On 17 April 2013, 1,073,436 Long Term Incentive Plan (LTIP) shares were awarded and 353,331 stock options were awarded to certain key senior executives and employees of the SDL Group. The exercise price of the options was 420 pence, representing the mid market price on the day before grant. On 17 April 2013, 1,137,026 Retention Share Plan (RSP) shares were awarded and will be funded by purchase through the Group's Employee Benefit Trust. The RSP shares will vest in two equal tranches over two years on the anniversary of the grant date, subject to the achievement of specified Group performance conditions.

10. General notes

The comparative figures for the financial year ended 31 December 2012 are not the Company's statutory accounts for that financial year. Those accounts have been reported on by the Company's auditor and delivered to the registrar of companies. The report of the auditor was (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

11. Events after the statement of financial position date

There are no known events occurring after the statement of financial position date that require disclosure.

Responsibility Statement by the Management Board

We confirm that to the best of our knowledge:

·; the condensed set of financial statements has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU;

·; the interim management report includes a fair review of the information required by:

(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

For and on behalf of the Board

Matthew Knight

Chief Financial Officer

Independent Review Report to SDL plc

Introduction

We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2013 which comprises the Interim Condensed Consolidated Income Statement, Interim Condensed Consolidated Statement of Comprehensive Income, Interim Condensed Consolidated Statement of Financial Position, Interim Condensed Consolidated Statement of Changes in Equity, Interim Condensed Consolidated Statement of Cash Flows, and the related explanatory notes. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

This report is made solely to the Company in accordance with the terms of our engagement to assist the Company in meeting the requirements of the Disclosure and Transparency Rules ("the DTR") of the UK's Financial Conduct Authority ("the UK FCA"). Our review has been undertaken so that we might state to the Company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company for our review work, for this report, or for the conclusions we have reached.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the DTR of the UK FCA.

The annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the EU. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with IAS 34Interim Financial Reporting as adopted by the EU.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued by the Auditing Practices Board for use in the UK. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2013 is not prepared, in all material respects, in accordance with IAS 34 as adopted by the EU and the DTR of the UK FCA.

Paul Gresham

for and on behalf of KPMG Audit Plc

Chartered Accountants

15 Canada Square

London

E14 5GL

6 August 2013