Interim Results

May 19 2011

EUROMONEY INSTITUTIONAL INVESTOR PLC

INTERIM FINANCIAL REPORT FOR THE SIX MONTHS TO MARCH 31 2011

·; Revenues up 13% to £167.6m

·; Adjusted profit before tax up 4% to £41.6m

·; Adjusted operating margin 30% (2010: 31%)

·; Operating cash flows up £12.1m to £51.9m

·; Net debt reduced to 1x EBITDA

·; Interim dividend maintained at 6.25p

·; Increased investment in new online information products continues

·; Tougher revenue comparators for second half

·; Trading in line with board's expectations

Commenting on the first half results, chairman Padraic Fallon said:

"Revenues and operating profits performed as expected, with continuing high investment in online subscription products. Net debt is now below 1x EBITDA, the lowest since 1997, thanks to very strong cash flows, leaving increasing headroom for very selective acquisitions. Revenue growth is slowing in line with expectations and may be affected further by a weaker dollar and uncertainty in the Eurozone and Middle East, but the board is confident that the group remains well placed for the future."

Highlights

Euromoney Institutional Investor PLC, the international publishing, events and electronic information group, achieved an adjusted profit before tax of £41.6m for the six months to March 31 2011, against £40.0m for the same period in 2010. Adjusted diluted earnings a share were 25.7p (2010: 24.9p). The board has approved an unchanged interim dividend of 6.25p a share to be paid to shareholders on July 21 2011.

As highlighted in the group's pre-close trading update issued on March 25 2011, the revenue growth achieved in the first half has been offset by several factors: an increase of £4.0m in long-term incentive expense relating to the timing of the accrual period for the group's Capital Appreciation Plan; the absence of one-off costs savings of £2m included in 2010's first half results; and a one percentage point reduction in the adjusted operating margin as a result of the group's increased investment in digital publishing as part of its strategy to drive long-term revenue growth.

Total revenues for the period increased by 13% to £167.6m. This reflects the success of the group's strategy of investing in subscription-based electronic information services, as well as the continued recovery of financial markets following the global credit crisis. This recovery began in the second half of financial year 2010 and continued into the first quarter of the current financial year. As highlighted in March, revenue comparisons have therefore become much tougher since the start of the second quarter of financial year 2011. Growth was achieved across all revenue streams.

As expected, the group's adjusted operating margin declined from the record levels achieved in financial year 2010. This was driven by both increased investment in technology and new products as part of the group's online growth strategy, as well as a catch-up of costs in some areas after the rapid recovery of revenues in the second half of 2010. The decline in adjusted operating margin in the first half, from 31% to 30%, was mitigated by the continued improvement in revenues.

Net debt at March 31 was £102.7m compared to £128.8m at year end. The continued reduction in debt levels reflects the strong operating cash flows of the group and the absence of any significant acquisitions or acquisition earn-out payments in the period. Net debt is now equivalent to just one times EBITDA, against 1.3 times at year end, leaving plenty of headroom for the group to pursue its selective acquisition strategy.

The outlook for financial markets remains uncertain as forecasts for economic growth are cut, inflation concerns rise, the credit problems in the Eurozone remain unresolved and unrest in the Middle East persists. Underlying revenues in April (after adjusting for timing differences) increased by 5% compared to a year ago and forward revenue visibility for the group's events businesses, for which the third quarter is the most important, is encouraging. However, since the trading update in March, there have been signs of a slowing in year-on-year rates of growth for both advertising revenues and delegate attendance at training courses. In addition, the rate of growth in subscription revenues is also expected to fall in the second half as growth comparisons become tougher.

Strategy

The company's strategy remains the building of a robust and tightly focused global online information business with a strong emphasis on emerging markets. This strategy is being executed through increasing the proportion of revenues derived from subscription products; accelerating the online migration of the group's print products as well as developing new electronic information services; investing in products of the highest quality that customers will value in tough times as well as good; eliminating products with a low margin or too high a dependence on advertising; maintaining tight cost control at all times; retaining and fostering an entrepreneurial culture; and generating strong cash flows to fund selective acquisitions to accelerate that strategy.

Driving revenue growth from existing as well as new products is a key part of the group's strategy. In 2010 the group embarked on an ambitious programme of investment in technology and content delivery platforms, particularly for the mobile user, and in new digital information products as part of its transition to an online information business. This investment programme will continue throughout 2011 and in the first half the group spent more than £4m (2010: £2m) on technology and new products, all of it expensed from profits.

Examples of recent launches include the Institutional Investor Network, Asiamoney Plus, five new online legal services covering areas such as tax disputes and internet intellectual property, and Metal Bulletin's Iron Ore Index, while businesses launched in 2010 such as Euromoney Market Data have continued to build on their launch success.

The strong cash flows of the group have helped it to reduce its net debt to just over £100m, the lowest level for five years, leaving plenty of headroom for the group to pursue its acquisition strategy. The group's preference is to buy small, specialist information businesses that complement its existing activities and provide scope for strong organic growth. The acquisition of Arete in August 2010 was a good example of the small, high quality online publishing businesses the group seeks to acquire. Arete has already been integrated fully into the Euromoney group and its performance since acquisition has exceeded expectations. A number of similar targets were actively pursued in the first half, although none to completion, and the group remains optimistic of completing acquisitions which complement its strategy.

Trading Review

Total revenues increased by 13% to £167.6m, but as expected with a marked difference between the growth rates in the first and second quarters (see table below). Revenues for the first quarter increased by 20%, continuing the strong momentum experienced in the second half of financial year 2010 and driven by a faster than expected recovery in financial markets after the credit crisis.

The performance of advertising, sponsorship and delegate revenues is closely aligned with the calendar budgets of most clients, which lag the group's September financial year by one quarter. Just as these revenues first picked up from January 2010, so the growth comparatives became much tougher from January 2011, and the overall rate of revenue growth slowed to 7% in the second quarter. The 12% decline in delegate revenues in this quarter was largely a function of timing differences on a few events: like-for-like delegate revenues increased by 16%. Indeed the events side of the business has been the strongest performer in the second quarter, with growth now coming from new events as well as continued growth from existing ones.

Subscription revenues continued to grow at a similar rate to the second half of financial year 2010. This reflects the lag in the recovery of subscription revenues following the credit crisis, as well as the success of the company's strategy of investing in premium electronic information services such as BCA Research and CEIC Data. Growth rates of between 15% and 20% have been achieved by the group's digital publishing businesses, contrasting favourably with the low growth rates of the more traditional print businesses. The rate of growth in subscription revenues picked up sharply from the third quarter of financial year 2010, and as growth comparisons get tougher so the rate of growth is expected to fall again from the third quarter of this financial year.

The group derives nearly two thirds of its revenues in US dollars and movements in the sterling-US dollar rate can have a significant impact on reported revenues. However, the average sterling-US dollar rate for the first half was $1.59 (2010: $1.60) and the trends in revenues at constant exchange rates were broadly the same as the headline changes.

The record adjusted operating margin achieved in financial year 2010 reflected both the benefit of tight cost control during the credit crisis as well as an earlier than expected recovery in revenues. Towards the end of 2010, costs, particularly those related to headcount, started to pick up and this, combined with increased investment in digital publishing, reduced the first half operating margin and is expected to continue to do so by up to two percentage points for the rest of 2011.

Group headcount increased by 50 to 2,011 people by the end of the first half, and the average headcount for the period was 2,010 people against 1,827 in the first half of last year. The increases in headcount have occurred mainly in the Databases and Information Services division, in response to the investment plans at BCA Research and CEIC Data, and in Business Publishing. However, the financial impact of the increased group headcount has been mitigated by reductions in the print publishing businesses and increased outsourcing of technology, digital development and telesales. As a result, the first half operating margin was 30% against 31% in the first half of 2010.

Business Review

Financial Publishing: revenues increased by 10% to £39.2m with the growth coming largely from the continued recovery of financial advertising. Adjusted operating profits increased by a similar rate to £12.3m. The adjusted operating margin was in line with last year as increased investment in digital publishing was absorbed by the high margin on incremental advertising revenues. Financial Publishing has also started to see increased momentum in the migration from print to online advertising, particularly for the higher circulation titles such as Institutional Investor. Online advertising now accounts for 10% of total advertising revenues.

Business Publishing: adjusted operating profits were unchanged at £9.1m despite a 9% increase in revenues to £25.9m. The fall in the adjusted operating margin from 38.6% to 35.2% reflects the increased investment during the period in digital publishing, particularly in areas such as Metal Bulletin and legal publishing. Investment in digital publishing has had a more marked impact on Business Publishing than Financial Publishing because the former derives less revenue from advertising and its advertising has been growing at a slower rate.

Training: the group's Training division predominantly serves the global financial sector, with a strong focus on emerging markets. The 15% increase in training revenues to £15.7m, and an adjusted operating margin of 24.2%, similar to 2010's level, masked contrasting performances between the first and second quarters. In the first, the revenue momentum from the recovery of financial markets at the start of 2010 continued. However, delegate bookings slowed significantly from the start of the new budget cycle in January as customers were reluctant to commit to training budgets in view of the generally uncertain outlook and in particular the unrest in the Middle East, a key market for this division. The delegate booking trend has remained flat since the start of the third quarter.

Conferences and Seminars: event revenues, which are derived from both sponsorship and paying delegates, increased by 11% to £38.2m. However, underlying revenue growth was closer to 20% after adjusting for unfavourable timing differences on events. Adjusted operating profits increased to £12.2m and the adjusted operating margin was unchanged at just under 32%. The trends seen in financial year 2010 have continued into 2011: as markets recover, so customers focus more attention on face-to-face meetings and rebuilding relationships, while new customers invest to establish their market position. In the initial stages of the recovery, this was reflected in strong growth from existing events, although more recently growth has also been derived from the launch of new events which generally tend to have lower margins.

Databases and Information Services: revenues are predominantly derived from subscriptions and increased by 17% to £49.5m. The main driver of growth in this division is BCA, the independent economic research house, and its revenues have continued to grow on the back of a substantial investment programme to expand BCA's sales resource internationally, launch new products and build its editorial resource outside its Montreal base. CEIC, ISI's provider of emerging market data for economists and analysts, has continued to experience growth rates in excess of 20%, again on the back of a substantial investment programme designed to expand its geographic coverage as well as improve the quality of data offered. In contrast, ISI's Emerging Markets Information Service, has been slower to recover, and during the first half a restructuring of this business was undertaken to reduce the number of offices globally and increase the focus on regional offices. This gave rise to an exceptional restructuring charge for the period of £1.3m. As expected, the significant investment taking place in this division has reduced adjusted operating margins, from 43.9% to 41.8%, although adjusted operating profits still increased by 11% to £20.7m.

Financial Review

The adjusted profit before tax of £41.6m compares to a statutory profit before tax of £32.7m. A detailed reconciliation of the group's underlying and statutory results is set out in the appendix to this statement. The statutory profit before tax is lower than the adjusted profit before tax, largely because of the impact of acquired intangible amortisation.

Underlying net finance costs for the group's committed borrowing facility fell by £1.1m to £3.6m, reflecting the rapid reduction in net debt over the past 12 months. The average cost of funds for the period was 5.6% (2010: 5.1%) and is expected to increase to 6.5% in the second half as the group's cheaper floating rate debt now comprises a smaller portion of the total debt. Headline net finance costs of £5.3m (2010: £6.0m) include a £1.8m charge for the increase in deferred consideration payable on the acquisition of Arete (see below).

The underlying effective tax rate for the first half was 26%, against 27% in 2010. The tax rate depends mainly on the geographic mix of profits and will benefit this year from reductions in UK and Canadian corporate tax rates. After using tax losses to reduce cash taxes paid in 2010, the group has returned to a tax paying position in 2011. Cash taxes paid in the first half were £19.4m, against an underlying tax expense of £10.9m, reflecting the timing of tax payments in certain tax jurisdictions.

The group continues to generate nearly two thirds of its revenues in US dollars, including approximately 30% of the revenues from its UK-based businesses, and more than half its operating profits are US dollar-denominated. The group hedges its exposure to US dollar revenues in its UK-based businesses by using forward contracts to sell surplus US dollars, which delays the impact of movements in exchange rates for at least a year. In the first half, the group benefited from a £1.3m reduction in realised hedging losses compared to last year.

The group does not hedge the foreign exchange risk, primarily from the US dollar, on the translation of overseas profits. It does, however, endeavour to match foreign currency borrowings with investments and the related foreign currency finance costs provide a partial hedge against the translation of overseas profits. The translation impact of a one cent movement in the average sterling-US dollar exchange rate on overseas profits is approximately £0.4m on an annualised basis. The average sterling-US dollar rate for the six months to March 31 was $1.59 (2010: $1.60) and therefore the impact of exchange rate movements on the translation of first half overseas profits was not significant. However, in the second half of financial year 2010, the average US dollar rate fell to $1.51 and exchange rates are therefore expected to have a more significant effect on second half profits.

Net Debt, Cash Flow and Dividend

Net debt at March 31 was £102.7m compared with £128.8m at year end and £178.1m a year earlier. Cash flows have traditionally been weighted to the second half because of the timing of certain payments including annual profit shares and dividends. However, first half cash flows were higher than usual due to the absence of any acquisitions or acquisition earn-out payments. Cash generated from operations increased by £12.1m to £51.9m and the operating cash conversion rate was 104% (2010: 88%).

In August 2010, the group acquired a 100% interest in Arete with the final price dependent on Arete's profits for its financial year to February 28 2011. Arete's trading performance since acquisition has exceeded forecasts at the time and the deferred consideration payable in May 2011 has increased from £0.7m to an estimated £2.5m, giving rise to a charge of £1.8m included in net finance costs for the period.

The group's debt is provided through a $400m multi-currency committed facility from Daily Mail and General Trust plc. The facility is provided in a mix of sterling and US dollar funds over three and five year terms expiring in December 2011 and 2013 respectively. It is expected that any remaining debt under the three-year facility in December 2011 will be rolled into the five-year facility.

The net debt to EBITDA covenant on the group's committed facility is subject to a limit of four times, although the group manages to a more conservative internal limit of three times. The ratio at the end of March was 1.0 times EBITDA against 1.3 times at year end, leaving plenty of headroom for the group to pursue its acquisition strategy.

The board increased the company's target dividend cover to three times after-tax earnings in 2009, since when it has been transitioning to a policy of paying approximately one third of the total dividend as an interim. This transition is being achieved by increasing the final dividend rather than reducing the interim. Pursuant to this transitional policy, the board has approved an unchanged interim dividend of 6.25p to be paid on July 21 2011 to shareholders on the register at May 27 2011. A scrip dividend alternative will again be available to shareholders and the group's majority shareholder, Daily Mail and General Trust plc, has indicated its intention to accept the scrip alternative.

Capital Appreciation Plan (CAP)

The CAP is the group's long-term, performance-based incentive designed to retain and reward those who drive profit growth, and is an integral part of the group's successful growth and investment strategy.

The terms of CAP 2010 broadly require an adjusted profit before tax (and before CAP long-term incentive expense) of £100m to be achieved within the four-year performance period ending in September 2013. If achieved, rewards under CAP 2010 will be satisfied by the issue of approximately 3.5m new ordinary shares and £15m in cash, with 50% of the reward deferred for a further 12 months and subject to additional performance tests.

The total cost of CAP 2010 will be no more than £30m and is being expensed over the expected life of the plan. The long-term incentive expense for the first half was £4.7m, against just £0.7m for the same period in 2010. This £4.0m increase in cost reflects the fact that amortisation of the CAP 2010 cost only commenced in March 2010 when CAP options were first granted to participants. In addition, amortisation of the CAP cost in the current period is based on management's assumption that the CAP performance test will be satisfied in financial year 2012, one year earlier than the original performance period.

Outlook

Recent trading has been mixed, reflecting the broader market environment, although trading for the group as a whole remains in line with the board's expectations. Underlying revenues in April (after adjusting for timing differences) increased by 5% compared to a year ago and forward revenue visibility for the group's events businesses, for which the third quarter is the most important, is encouraging.

However, there have been signs of a softening in advertising markets in recent weeks, largely in response to increasing uncertainty over the prospects for global economic growth as well as continued nervousness over financial markets and the Eurozone sovereign debt problems in particular. This uncertainty, combined with unrest in the Middle East region, has also contributed to flat delegate bookings in the training businesses for several months which is expected to hold back growth from this division in the second half. In addition, the rate of growth in subscription revenues is also expected to fall in the second half as growth comparisons with 2010 become much tougher and exchange rates are expected to be unfavourable.

The group's investment in digital publishing and expansion of products offered by BCA Research and CEIC Data will continue throughout the second half. This strategy is designed to drive revenue growth in 2012 and beyond and, as highlighted previously, is expected to reduce the adjusted operating margin in 2011 by up to two percentage points from the record level achieved in 2010.

The group has a successful and sustainable strategy and will continue to invest in technology and new digital publishing models in the second half as it drives its transition to a global online information business, at the same time as using its rapidly falling debt levels to pursue its selective acquisition strategy.

Padraic Fallon

Chairman

May 18 2011

END

For further information, please contact:

Euromoney Institutional Investor PLC

Padraic Fallon, Chairman: +44 20 7779 8556; [email protected]

Colin Jones, Finance Director: +44 20 7779 8845; [email protected]

Richard Ensor, Managing Director: +44 20 7779 8845; [email protected]

Financial Dynamics

Charles Palmer: +44 20 7269 7180; [email protected]

CAUTIONARY STATEMENT

This Interim Financial Report (IFR) has been prepared solely to provide additional information to shareholders to assess the Euromoney group's results and strategy and the potential for that strategy to succeed. The IFR should not be relied on by any other party for any other purpose.

The IFR contains certain forward-looking statements. These statements are made by the directors in good faith based on the information available to them up to the time of their approval of this report but such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.

NOTE TO EDITORS

Euromoney Institutional Investor PLC (www.euromoneyplc.com) is listed on the London Stock Exchange and a member of the FTSE-250 share index. It is a leading international business-to-business media group focused primarily on the international finance, metals and commodities sectors. It publishes more than 70 titles including Euromoney, Institutional Investor and Metal Bulletin. It also runs an extensive portfolio of conferences, seminars and training courses and is a leading provider of electronic information and data services covering international finance, metals and emerging markets. Its main offices are in London, New York, Montreal and Hong Kong and more than a third of its revenues are derived from emerging markets.

Appendix to Chairman's Statement

Reconciliation of Condensed Consolidated Income Statement to underlying results for the six months ended March 31 2011

The reconciliation below sets out the underlying results of the group and the related adjustments to the statutory income statement that the directors consider necessary in order to provide an indication of the underlying trading performance.

Underlying figures are presented before the impact of amortisation of acquired intangible assets (comprising brands, trademarks, databases and customer relationships) and goodwill impairment, restructuring and other exceptional operating costs, deferred consideration adjustments, non-cash movements on acquisition option commitment values, foreign exchange losses on restructured hedge arrangements and foreign exchange losses on tax equalisation swap contracts. In respect of earnings, underlying amounts reflect a tax rate that includes the current tax effect of the amortisation of goodwill and intangible assets.

Further analysis of the adjusting items is presented in notes 4, 5, 6 and 8 to the Condensed Consolidated Interim Financial Report.

Condensed Consolidated Income Statement

for the six months ended March 31 2011

A detailed reconciliation of the group's underlying results is set out in the appendix to the Chairman's Statement on page 9.

Condensed Consolidated Statement of Comprehensive Income

for the six months ended March 31 2011

Condensed Consolidated Statement of Financial Position

as at March 31 2011

A reconciliation of net debt is set out in note 10 to this Condensed Consolidated Interim Financial Report.

Condensed Consolidated Statement of Changes in Equity

for the six months ended March 31 2011