Preliminary Results 2011

November 10 2011

EUROMONEY INSTITUTIONAL INVESTOR PLC

RESULTS FOR THE YEAR TO SEPTEMBER 30 2011

·; Revenues increased by 10% to £363.1m, with continued growth across all revenue streams

·; Adjusted profit before tax up 7% to £92.7m

·; Adjusted operating margin maintained at 30%

·; CAP profit target achieved two years earlier than expected triggering £6.6m additional accelerated cost in 2011

·; Operating cash flows up 17% to £118.0m

·; Final dividend increased by 6% to 12.5p

·; Integration of Ned Davis Research proceeding well

·; Subscriptions expected to account for more than 50% of revenues for first time in 2012

·; First quarter trading in line with board's expectations

·; Uncertain trading outlook especially for advertising

Commenting on the results, chairman Padraic Fallon said:

"The environment's getting tougher and more volatile revenues like advertising have shown signs of weakness, but cash flows are very strong and the immediate outlook is fairly positive."

Highlights

Euromoney Institutional Investor PLC, the international publishing, events and electronic information group, achieved an adjusted profit before tax of £92.7m for the year to September 30 2011, against £86.6m in 2010. Adjusted diluted earnings a share were 56.1p (2010: 53.5p). The directors recommend a 6% increase in the final dividend to 12.50p, giving a total for the year of 18.75p (2010: 18.0p), to be paid to shareholders on February 9 2012.

These record results mean the group has achieved the profit target under its Capital Appreciation Plan two years earlier than first expected. Although individual awards under the plan cannot vest more than one year early, the satisfaction of the performance test triggers an additional accelerated long-term incentive expense of £6.6m, with a corresponding reduction in the expense in future years. This additional accelerated expense has been excluded from adjusted profit before tax and the adjusted diluted earnings a share figure used for setting the final dividend.

The group's performance in the second half has broadly matched that of the first, although markets have become more challenging as the year has progressed. Double digit growth in subscription revenues was maintained throughout the year while the quality of the group's event portfolio has been demonstrated by the 20% growth in sponsorship revenues. Total revenues for the year increased by 10% to £363.1m and this revenue growth, combined with tight control of headcount, helped the group maintain its adjusted operating margin at 30% in spite of significant investment in new products and technology.

Net debt at September 30 was £119.2m compared with £102.7m at March 31, following the acquisition of Ned Davis Research in August for a cash consideration of £64.8m. Excluding acquisitions, net debt fell by approximately £50m in the second half, reflecting the group's strong cash flows and an operating cash conversion rate* in excess of 100%. The group's net debt to EBITDA ratio at year end was 1.0 times, leaving plenty of headroom for the group to pursue its selective acquisition strategy.

Despite the continuing volatility and uncertainty in financial markets, the broad outlook for the first quarter of the new financial year is reasonably positive. Subscription revenues, after removing the effect of exchange rates and the acquisition of NDR, increased at an underlying rate of 9% in the fourth quarter, which provides good momentum for further revenue growth in financial year 2012. Delegate bookings for the group's training and event businesses have held up well. However, as highlighted in September's trading update, sales of advertising, and to a lesser degree event sponsorship, have shown signs of weakness since the summer. The board expects the trading environment for the rest of financial year 2012 to be more challenging and, as usual at this time, forward revenue visibility beyond the first quarter is limited other than for subscriptions.

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; using technology efficiently to assist 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 using a healthy balance sheet and strong cash flows to fund selective acquisitions.

During 2011 the group continued its ambitious programme of investing in new technology and content delivery platforms, particularly for the mobile user, and in new digital information products, as part of its migration to a global online information business. Over the year the group spent more than £9m enhancing its existing products, all of it expensed from profits, and expects a similar level of investment in 2012. In addition, the group has undertaken a substantial investment programme at two of its most important electronic information businesses, BCA Research and CEIC Data, with a view to building rapidly the quality and coverage of their products and expanding their global sales resources.

In August the group completed the acquisition of Ned Davis Research (NDR). NDR produces data, financial models, charts and independent market commentary to help clients execute their asset allocation strategies. All of NDR's content is published online and the acquisition is expected to increase the proportion of the group's revenues derived from subscriptions to more than 50% for the first time. Euromoney intends to apply a similar investment strategy to NDR as it has done so successfully with its other independent research business, BCA Research, and build a range of new international products and drive revenue growth through an expanded global sales team. The early signs of trading at NDR are encouraging.

In 2012, the company intends to continue to pursue its successful strategy of tight cost control while investing in digital publishing and selective acquisitions of specialist online information businesses to drive further long-term revenue growth.

Capital Appreciation Plan (CAP)

The CAP is the group's long-term incentive scheme 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 expense) of £100m to be achieved, from a base profit of £62.3m in financial year 2009, within the four year performance period ending in September 2013. The better than expected financial performance of the group in the last two years means the CAP profit target has been achieved in financial year 2011, two years earlier than expected.

The total cost of CAP 2010 can be no more than £30m. This cost was being expensed over the expected life of the plan, starting from March 2010, on the assumption that the profit performance test would first be satisfied in the financial year ending in September 2012, one year earlier than originally expected. The profit performance has now been satisfied two years earlier than expected and, under IFRS2, the earlier achievement of the CAP profit target triggers an additional accelerated CAP expense of £6.6m in this financial year, with a corresponding reduction in the expected CAP expense for financial years 2012, 2013 and 2014 of £1.1m, £3.8m and £1.7m respectively. The board believes that this additional accelerated CAP expense distorts the underlying earnings of the group and has excluded this cost from its reported adjusted profit before tax and the adjusted diluted earnings a share figure used for setting the final dividend.

Rewards under CAP 2010 will be satisfied by the issue of approximately 3.5 million new ordinary shares and £15m cash, with 50% of the reward deferred for a further 12 months and subject to additional performance tests. The rules of the CAP were modified this year such that individual awards could not vest more than one year ahead of the original performance period. This means that although the CAP profit target has been reached in financial year 2011, individual CAP awards will be based on profits for financial year 2012 and the first 50% tranche of CAP awards will not vest until February 2013.

The second 50% tranche of CAP awards will only vest if the CAP profit target is again achieved in financial year 2012 or later. Following the acquisition of NDR, the profit target for the second 50% vesting of CAP awards has been increased by £5m to £105m.

Trading Review

Total revenue increased by 10% to £363.1m. After a 13% increase in the first half, the headline rate of revenue growth dropped to 7% in the second, largely due to the impact of exchange rates. At constant currency, the underlying rate of revenue growth was 12% in the second half, against 13% in the first, with growth across all revenue streams.

Subscriptions account for nearly half the group's revenue and the group has maintained double digit growth throughout financial year 2011, despite comparisons with 2010 becoming tougher as the year progressed. More than 70% of subscription revenues are derived in US dollars and currency movements have had a negative impact on growth rates in the second half. After removing the effect of exchange rates and the acquisition of NDR, underlying subscription revenues increased at a rate of 11%. This subscription growth continues to be generated by the group's premium online research and data services such as BCA Research and CEIC Data, contrasting with the lower growth rates of the traditional print publishing businesses. The acquisition of NDR and the group's investment in online publishing is expected to continue to support subscription revenue growth in the first half of financial year 2012.

As reported in the pre-close trading update in September, the volatility and uncertainty in markets over the summer was followed by a slowing in the rate of growth of advertising and, to a lesser degree, event sponsorship sales. As a result, September's advertising revenues were lower than expected although the impact of this advertising slow-down is more likely to be felt in the first quarter of financial year 2012.

The event businesses have been a key driver of the group's strong recovery over the two years since the global credit crisis. Revenues broadly comprise an equal mix of both sponsorship and paying delegates, and the growth in the second half reflects the success of the group's strategy of building large, must-attend annual events in niche markets, and continually investing to grow these events while adding new, smaller events as markets improve. The recent market uncertainty has had limited impact on the group's event businesses, while delegate bookings for training courses have held up well.

The group derives nearly two thirds of its total revenue in US dollars and movements in the sterling-US dollar rate can have a significant impact on reported revenues. This was not the case in the first half but in the second the average US dollar rate increased to $1.63 (2010: $1.51) which means that headline revenue growth rates are lower than underlying growth rates at constant currency by several percentage points (see table above).

The group's adjusted operating margin was 30.0% against 30.3% in 2010. The continued investment in digital publishing and the lag effect of increases in headcount at the end of 2010 was expected to have a negative impact on margins in 2011. This was the case in the first half when the adjusted operating margin fell by one percentage point, but this trend was reversed in the second half as revenue growth was derived from the group's higher margin research and data businesses and headcount was tightly controlled in expectation of a more challenging trading environment. Permanent headcount at September 30 was 2,111 against 2,011 at March 31 and the increase in headcount in the second half was entirely due to the acquisition of NDR. The average permanent headcount for the year increased by 9% to 2,032.

Business Review

Financial Publishing: revenues, approximately 50% of which are advertising-related, increased by 5% to £83.8m and adjusted operating profit by 3% to £28.2m. Advertising revenues came under pressure towards the end of the year but the increased investment in digital publishing has contributed to an increasing proportion of advertising revenues from online rather than print, and a strong performance from products less dependent on advertising such as EuroWeek and Institutional Investor Research.

Business Publishing: the group's activities outside finance cover a number of sectors including metals, commodities, energy, telecoms and law, with only 35% of revenues derived from advertising. Revenues increased by 7% to £59.5m and the adjusted operating margin dropped from 41% to 39% due to the impact of investment in digital publishing, particularly in businesses such as Metal Bulletin and legal publishing.

Training: the group's training division predominantly serves the global financial sector with a strong focus on emerging markets. After a slow start to the calendar year, due partly to the political unrest in the Middle East, delegate bookings improved from June and the division finished the year strongly with a 16% increase in Q4 revenues. Training revenues for the year increased by 9% to £32.5m and adjusted operating profits by 10% to £7.9m at a consistent adjusted operating margin of 24%.

Conferences and Seminars: revenues comprise both sponsorship and paying delegates and increased by 12% to £86.2m. Adjusted operating profit increased by 13% to £26.6m and the adjusted operating margin was unchanged at 31%. Growth has come across all sectors but in particular from those outside finance such as metals, coal and telecoms which have a higher emerging market exposure.

Research and Data: revenues are predominantly derived from subscriptions and increased by 16% to £104.3m. Adjusted operating profit increased by 12% to £42.5m and the adjusted operating margin fell by one percentage point to 41% reflecting the investment programme at BCA research and CEIC Data. NDR contributed subscription revenues of £4.6m and an adjusted operating profit of £1.2m for the two months since acquisition.

Financial Review

The adjusted profit before tax of £92.7m compares to a statutory profit before tax of £68.2m. A detailed reconciliation of the group's adjusted and statutory results is set out in the appendix to this statement. The statutory profit is generally lower than the adjusted profit before tax because of the impact of acquired intangible amortisation. In addition, the earlier than expected achievement of the CAP profit target (see above) has triggered an additional accelerated CAP expense of £6.6m which has further reduced the group's statutory profit.

Adjusted net finance costs for the group's committed borrowing facility fell by £2.1m to £7.2m, reflecting the rapid reduction in net debt prior to the acquisition of NDR. The average cost of funds for the year increased to 5.7% (2010: 5.2%) as the group's cheaper floating rate debt comprised a smaller portion of the total debt for most of the year. Following the acquisition of NDR, this position is expected to reverse in 2012 when the average cost of debt should be less than 5%. Statutory net finance costs of £9.6m (2011: £10.7m) include a £1.8m charge for the increase in deferred consideration paid on the acquisition of Arete in 2010.

The adjusted effective tax rate for the year was 26% against 27% in 2010. The tax rate depends on the geographic mix of profits and the group has benefited this year from reductions in UK and Canadian corporate tax rates, which are expected to lower the adjusted effective tax rate again in 2012. After utilising tax losses to reduce cash taxes paid in 2010, the group returned to a tax paying position in 2011 and cash taxes paid in the year were £27.0m against an adjusted tax expense of £24.2m.

The group continues to generate nearly two thirds of its revenues in US dollars, including approximately 30% of the revenues in its UK-based businesses, and more than half its operating profits are US dollar-denominated. The group hedges its exposure to the US dollar revenues in its UK businesses by using forward contracts to sell surplus US dollars. This delays the impact of movements in exchange rates for at least a year. As a result of this hedging policy, the group benefited from a £0.4m reduction in currency 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 year was $1.61 (2010: $1.55) which reduced profits by approximately £2.5m, most of it in the second half when the rate was $1.63 against $1.51 for the same period in 2010.

Net Debt, Cash Flow and Dividend

Net debt at September 30 was £119.2m compared with £102.7m at March 31, following the acquisition of Ned Davis Research in August for a cash consideration of £64.8m. Excluding acquisitions, net debt has fallen by approximately £50m since March 31, reflecting the group's strong cash flows which are traditionally weighted to the second half. Cash generated from operations increased by £17.2m to £118.0m and the operating cash conversion rate* was 108% (2010: 101%).

The acquisition of an 85% interest in NDR was funded from the group's existing borrowing facility. The remaining 15% will be acquired under an earn-out agreement, in two equal instalments, based on the profits of NDR for the years to December 31 2012 and 2013. At September 30, the expected discounted consideration payable under the earn-out was £10.1m.

The group's debt is provided through a $400m (£258m) multi-currency committed facility from its parent company, Daily Mail and General Trust plc (DMGT). The three year facility (£65m) is due to expire in December 2011 and will not be renewed. The five year facility (£193m) expires in December 2013 and will be used to fund the group's borrowing requirements for the next two years. In addition, DMGT has recently renewed its bank facilities for a five year period to April 2016, under which a facility of $300m (£193m) will be available to the group on expiry of its five year facility should it be required.

The net debt to EBITDA ratio on the group's committed facility was 1.0 times at year end, well within the group's internal covenant of three times. There are no significant capital or acquisition commitments currently expected for financial year 2012, leaving the group with plenty of headroom to pursue its selective acquisition strategy.

The company's policy is to distribute a third of its after-tax earnings by way of dividends each year. Accordingly, the board recommends a final dividend of 12.5p a share (2010: 11.75p) making a total dividend for the year of 18.75p (2010: 18.0p). The adjusted diluted earnings a share figure (56.1p) used to calculate the final dividend excludes the additional accelerated CAP long-term incentive scheme expense of £6.6m because the board believes this gives a better indication of the underlying earnings of the group. The final dividend will be paid on February 9 2012 to shareholders on the register at November 18 2011. A scrip dividend alternative will again be available to shareholders and the group's majority shareholder, DMGT, has indicated its intention to accept the scrip alternative.

Outlook

Financial markets continue to suffer from concerns over increased fiscal risk, particularly in the Eurozone, and weaker prospects for global economic growth. Nevertheless, the outlook for the first quarter of the new financial year is reasonably positive. Subscriptions, which account for approximately half the group's revenues, increased at an underlying rate (after removing the effect of exchange rates and the acquisition of NDR) of 9% in the fourth quarter which provides good momentum for further revenue growth in 2012. Delegate bookings for the group's training and event businesses have also held up well. In contrast, as announced in September, sales of advertising, and to a lesser degree event sponsorship, have shown signs of weakness since the summer. The board expects the trading environment for the rest of financial year 2012 to be more challenging and, as usual at this time, forward revenue visibility beyond the first quarter is limited other than for subscriptions.

For 2012, the group plans to continue its programme of investing in the digital transformation of its publishing businesses, and in improving the quality of the product and expanding the sales resources of its research and data businesses including the recently acquired Ned Davis Research. Total investment costs are expected to be similar to those expensed in financial year 2011.

The company is well prepared for the challenging markets ahead and in a stronger position than it was at the start of the last financial crisis, and will continue to pursue its successful strategy of investing in new products, digital publishing and selective acquisitions to drive further long-term growth.Padraic Fallon

Chairman

November 9 2011

\* The operating cash conversion rate is the percentage by which cash generated from operations covers adjusted operating profit.

END

For further information, please contact:

Euromoney Institutional Investor PLC

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

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

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

FTI Consulting

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

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 in both print and on-line format including Euromoney, Institutional Investor and Metal Bulletin, and is a leading provider of electronic research and data under the BCA Research, Ned Davis Research and ISI Emerging Markets brands. It also runs an extensive portfolio of conferences, seminars and training courses for financial markets. The group's 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 Consolidated Income Statement to adjusted results for the year ended September 30 2011

The reconciliation below sets out the adjusted results of the group and the related adjustments to the statutory consolidated Income Statement that the directors consider necessary in order to provide an indication of the adjusted trading performance.

Adjusted figures are presented before the impact of amortisation of acquired intangible assets (comprising brands, trademarks, databases and customer relationships) and goodwill impairment, the additional accelerated long-term incentive expense, restructuring and other exceptional operating costs, deferred consideration and non-cash movements on acquisition option commitment values. In respect of earnings, adjusted amounts reflect a tax rate that includes the current tax effect of the goodwill and intangible assets.

Further analysis of the adjusting items is presented in notes 3, 4, 5, 6 and 8 to this report.

Consolidated Income Statementfor the year ended September 30 2011

A detailed reconciliation of the group's statutory results to the adjusted results is set out in the appendix to the Chairman's Statement on page 7.

Consolidated Statement of Comprehensive Incomefor the year ended September 30 2011

Consolidated Statement of Financial Position

as at September 30 2011

Consolidated Statement of Changes in Equity

as at September 30 2011

The investment in own shares is held by the Euromoney Employees' Share Ownership Trust (ESOT). At September 30 2011 the ESOT held 58,976 shares (2010: 58,976 shares) carried at a historic cost of £1.25 per share with a market value of £363,000 (2010: £361,000). The trust waived the rights to receive dividends. Interest and administrative costs are charged to the profit and loss account of the ESOT as incurred.

The other reserve represents the share premium arising on the shares issued for the purchase of Metal Bulletin plc in October 2006.

Consolidated Statement of Cash Flows

for the year ended September 30 2011