Preliminary Results

EUROMONEY INSTITUTIONAL INVESTOR PLC

RESULTS FOR THE YEAR TO SEPTEMBER 30 2010

Commenting on the record results, chairman Padraic Fallon said:

"The resilience of subscription income combined with a good recovery in advertising and sponsorship revenues during the second half to produce a record profit, and this revenue growth has continued into the first quarter of the new financial year. Cash flows are strong and debt is falling rapidly to leave headroom for increased investment in new products, most of them with digital platforms, as well as small strategic acquisitions. The external environment, however, continues to be threatened by sovereign debt problems in the eurozone and by the challenges facing financial institutions in developed countries. Those considerations apart, the group is well placed to continue to grow."

Highlights

Euromoney Institutional Investor PLC, the international publishing, events and electronic information group, achieved a record adjusted profit before tax of £86.6m for the year to September 30 2010, against £63.0m in 2009. Adjusted diluted earnings a share were 53.5p (2009: 40.4p). The directors recommend a final dividend of 11.75p, giving a total for the year of 18.0p (2009: 14.0p), to be paid to shareholders on February 4 2011.

These record profits, coming so soon after some of the toughest and most volatile financial markets in many years, underline the success of the group's strategy to build a more robust and higher quality information business. After strong first half results, driven largely by the benefit of cost cuts made the year before, the second half brought a return to revenue growth earlier and faster than expected. Revenues for the year increased by 4% to £330.0m, after a 16% increase in revenues in the second half. This better than expected revenue performance helped to offset the group's significant investment in new products and the online migration of its print businesses. The group's adjusted operating margin improved to 30% against 25% in 2009.

Net debt at September 30 was £128.8m compared to £178.1m at March 31. The sharp reduction in debt levels over the past six months reflects the good second half revenue performance as well as the group's rigorous debt management and strong cash flows. The group's net debt to EBITDA ratio fell to 1.3 times, against 1.9 times at March 31, similar to the level immediately before the acquisition of Metal Bulletin in 2006.

The recent strength of equity and commodity markets, and the positive outlook for emerging markets, all provide momentum for further recovery. However, the broader outlook for global economic growth remains challenging, while many global financial institutions have reported disappointing results for their second and third quarters. This, together with lingering concerns over sovereign debt levels in Europe, and the effectiveness of measures to avoid a repeat of the credit crisis, creates uncertainty over the outlook beyond December.

Nevertheless, the outlook for the start of the new financial year is good and the board expects the recovery in revenues experienced in the second half to continue into the first quarter. As usual at this time, forward revenue visibility beyond the first quarter, traditionally the group's least important three months of trading, is limited other than from subscriptions, and revenue growth will be harder to achieve as the 2010 comparatives become tougher.

Strategy

The company's strategy is to build a more resilient and better focused global information business, with a strong emphasis on emerging markets. This strategy continues to be executed through increasing the proportion of revenues derived from subscription products; accelerating the online migration of its 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.

While tight cost management was maintained throughout the year, the strategic focus has shifted to driving revenue growth, both from existing products as markets recover, and from investment in technology platforms and new products as part of the migration to an online information business. During the year the group invested more than £6m in online products and new businesses, all of it from profits, and there is a significant programme of new launches planned for 2011.

At the same time, the group started to execute long-term investment programmes for two of the group's most important electronic information businesses: BCA, the independent economic research business, and CEIC, the provider of emerging market databases for economists and analysts around the world, with a view to building rapidly the quality and coverage of their products as well as expanding their global sales resources. This increased level of investment is being undertaken with a view to driving revenue growth for 2012 and beyond.

The strong cash flows of the group have helped it to reduce its net debt by nearly £50m since March 31 and there are no significant capital or acquisition cash commitments for 2011. The group's preference is to acquire small, specialist information businesses that complement its existing activities and provide scope for strong organic growth. Over the past year, the opportunities to acquire such businesses have been limited, although the acquisition of Arete in August was a good example of the small but high quality online publishing businesses the group seeks to acquire. Arete is the definitive global data and news source for structured retail investment products, primarily through its proprietary database containing information on more than 1.3 million structured products around the world. Early signs of trading at Arete are encouraging.

The company will continue to pursue its successful strategy in 2011, with an emphasis on investing in technology and new subscription-based electronic information services, supplemented with small strategic acquisitions, to drive revenue growth.

Trading Review

Total revenue increased by 4% to £330.0m, but with a marked difference between the revenue performance in each half: an 8% fall in the first half was offset by a 16% increase in revenue in the second (see table below). Traditionally the recovery in revenue at the end of a downturn tends to be slower than the fall at the start, but this has not been the case following the credit crisis, when the recovery has happened much earlier and faster than expected.

The faster than expected recovery of subscription revenues was the most encouraging trading sign during the second half. The pick up in subscription renewal rates began in the summer of 2009, and has been followed by a recovery in sales of new subscriptions. This reflects a combination of stronger markets, increased investment in marketing and electronic publishing, as well as many new customers identified in the aftermath of the credit crisis. Subscriptions continue to account for nearly 50% of group revenues.

Most of the group's biggest subscription businesses, including BCA Research, II Memberships and CEIC have seen revenues and renewal rates return to pre-credit crisis levels earlier than expected. Subscription revenues increased by 1% over the year, while the quarterly year-on-year growth rate (at constant exchange rates) had improved to 7% by the end of the year.

Advertising revenues were the first to suffer during the credit crisis, and the first to recover. Advertising budgets and campaigns tend to be linked to the calendar year, although the rate of recovery has improved each quarter as global financial institutions became more confident about the outlook for financial markets. In addition, the financial year closed with a particularly strong September, the key month of the year for many of the group's advertising-led businesses.

Revenues from events, which comprise both sponsorship and paying delegates, experienced the most rapid recovery in 2010. Event revenues were hit hard during the credit crisis as customers exercised tight controls over training, event attendance and travel. At the same time the group cut event volumes by eliminating many of its smaller, low margin events, and continued to invest to enhance the market leading positions of its annual conferences and meetings. The majority of the group's largest events are held in the second half of its financial year and as markets have recovered, so attendance at these events has returned rapidly to pre-credit crisis levels or better.

As in the first half, emerging markets, which account for more than a third of the group's revenue, continued to hold up reasonably well, with Asia and Latin America providing the main sources of growth.

The group derives nearly two thirds of its revenue in US dollars and movements in the sterling-US dollar rate have had a significant impact on reported revenues in some years. However, in 2010 the average sterling-US dollar exchange rate was $1.55, against $1.58 a year ago, and movements in exchange rates have not had a significant impact on reported revenues or margins.

While the results for the first half reflected the continuing benefit of cost cuts in 2009, the return to revenue growth in the second half has meant the increased investment in technology and new products has been executed with minimal impact on margins. Inevitably headcount has increased - permanent headcount at September 30 was 1,988, an increase of 141 during the second half - but the adjusted operating margin in the second was 30%, very similar to that achieved in the first half.

Business Review

Financial Publishing: revenues, approximately 40% of which are subscription-driven, increased by 3% to £76.6m. However, adjusted operating profit increased by 29% to £26.2m on the back of an improvement in the adjusted operating margin from 27% to 34%. The better margin partly reflects the cost cuts made in 2009 - the Financial Publishing division was one of those most affected by the credit crisis - and partly the strong end to the year as many of the titles publish their biggest issue of the year in September. Among the best performers were Euromoney, EuroWeek and Latin Finance, all of which have a significant emerging market exposure.

Business Publishing: the group's activities outside finance are less volatile, reflecting the spread of sectors covered including metals, commodities, energy, telecoms and law, and the higher proportion of revenues derived from subscriptions. These sectors held up relatively well during the credit crisis and were not subject to significant costs cuts, leaving limited margin upside. Revenues increased by 5% to £59.1m and the adjusted operating margin was unchanged at 42%. Metal Bulletin was again the best performer as subscription revenues continued to grow, driven by a combination of product investment and increased marketing spend.

Training: the group's Training division predominantly serves the global financial sector and was the hardest hit by the credit crisis and cuts in training spend, headcount and travel budgets. Training revenues, which are mostly derived from paying delegates, fell by 6% to £29.9m, largely due to a 26% decline in the first quarter as the impact of the credit crisis continued into the early part of the financial year. From January, as customer training budgets returned, delegate bookings gradually improved, although course volumes have been held back until there is more certainty over the recovery. The resultant increase in average bookings per course helped the margin improve from 20% to 24%, and adjusted operating profit increased by 14% to £7.2m

Conferences and Seminars: revenues comprise both sponsorship and paying delegates and increased by 4% to £78.8m. The recovery in the adjusted operating margin from 21% to 29% helped drive an increase in adjusted operating profit of nearly 50% to £23.2m, and demonstrates the success of the group's strategy to cut low margin events in a downturn, while continuing to focus on building its larger, must-attend annual events in niche markets. As markets have recovered, the group's bigger events have seen a sharp recovery in demand and attendance has improved. Growth has come across all sectors, with some such as structured finance and hedge funds rebounding faster than expected, and others such as metals, coal and telecoms, with their strong emerging markets exposure, achieving record attendance and revenues.

Databases and Information Services: revenues are predominantly derived from subscription contracts of 12 months or longer, and the performance of this division therefore tends to lag the others. Revenues increased by 3% to nearly £90m and, with a steady adjusted operating margin of 41%, adjusted operating profit increased by 2% to £37.0m. Revenue growth in this division slowed from the second half of 2009, a trend which continued into the first half of 2010 before recovering in the second half. This largely reflects the lag effect of cuts in headcount and information-buying by customers in the first half of 2009. BCA returned to growth from the third quarter, earlier than expected, and margins were maintained despite the start of a substantial investment programme to build BCA's editorial resource and to expand its sales teams. CEIC continued to experience strong growth in revenue from its emerging markets data service, which helped offset weaker demand for ISI's emerging markets information service.

Financial Review

The adjusted profit before tax of £86.6m compares to a statutory profit before tax of £71.4m. A detailed reconciliation of the group's underlying 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.

Underlying net finance costs for the group's committed borrowing facility fell by £4.7m to £9.3m, reflecting both lower debt levels and lower interest rates. The average cost of funds for the year was 5.2% (2009: 6.0%). The group's policy of swapping 80% of its debt into fixed rates for at least the next 12 months means that the average cost of funds in 2011 is unlikely to increase significantly.

The underlying effective tax rate for the year was 27%, the same as 2009. The tax rate depends on the geographic mix of profits and is not expected to change significantly in 2011. Net cash taxes paid were only £1.9m, reflecting the benefit of tax losses in 2009. However, the strong profit performance and utilisation of tax losses means the group is now paying taxes in all jurisdictions and cash taxes will match more closely the underlying tax expense in 2011.

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 £3.9m reduction in hedging losses compared to last year.

The group does not hedge the foreign exchange risk on the translation of overseas profits, although it does endeavour to match foreign currency borrowings with investments. The related foreign currency finance costs provide a partial hedge against the translation of overseas profits. In 2010, the impact of foreign exchange rates movements on the translation of profits was not significant.

Net Debt, Cash Flow and Dividend

Net debt at September 30 was £128.8m compared with £178.1m at March 31. The reduction in net debt of nearly £50m since the half year reflects the strong operating cash flows of the group. These are traditionally weighted to the second half due to the timing of payment for annual profit shares, dividends and acquisition earn-outs. Cash generated from operations increased by £28.2m to £100.8m and the operating cash conversion rate was 101% (2009: 91%).

In August, the group completed the acquisition of Arete Consulting Limited, its first material transaction since the acquisition of Metal Bulletin in October 2006. The group acquired a 100% interest in Arete for an expected net consideration of £5.8m, of which £0.6m is deferred until April 2011, with the final price dependent on Arete's profit for its financial year to February 28 2011. Arete's revenue for that year is expected to be in the region of £3m.

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. The reduction in debt levels in 2010 and expected continued strong cash flows in 2011 means any remaining debt under the three year facility can be rolled into the five year facility at the December 2011 expiry date.

The net debt to EBITDA covenant on the group's committed facility is subject to a limit of four times, although the group manages its gearing to a more conservative internal limit of three times EBITDA. The ratio at the end of September was 1.3 times against just under 2.0 times a year ago. There are no significant capital or acquisition cash commitments currently expected for 2011.

In 2009, the board increased the company's target dividend cover to three times after-tax earnings. Pursuant to this policy, the board has recommended a final dividend of 11.75p a share (2009: 7.75p) making a total dividend for the year of 18.0p (2009: 14.0p). The final dividend will be paid on February 4 2011 to shareholders on the register at November 19 2010. 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 strategy. CAP 2010 was approved by shareholders at the annual general meeting in January 2010.

The terms of CAP 2010 broadly require an adjusted profit before tax (and before CAP long-term incentive expense) of £100m to be achieved, from a base profit of £62.3m in 2009, within the four year performance period ending in September 2013. If achieved, rewards under CAP 2010 will be satisfied by the issue of approximately 3.5 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 total cost of CAP 2010 will be no more than £30m, which is being expensed over the expected life of the plan. The CAP expense for the seven months since it was launched in March 2010 was £3.9m. In the event the CAP profit target was achieved a year before the end of the 2013 performance period, the expected life of the plan would be shortened and the annual CAP expense would increase. For the financial years 2011 and 2012, if the £100m CAP profit target was achieved in 2012, the annual CAP expense would increase from £6.8m to £9.2m.

Outlook

The board expects the good revenue performance achieved in the second half of 2010 to continue into the first quarter of financial year 2011. Further, subscriptions, which account for nearly 50% of the group's revenues, were growing at an annual rate of seven percent at the end of 2010, which provides support for further growth in 2011. However, there is uncertainty over the outlook beyond December, and the recovery of advertising and event revenues in financial year 2010 started from the second quarter and revenue comparisons will therefore become much tougher from the second quarter of financial year 2011.

The level of spending on technology and new product investment will increase further in 2011. In the short-term, this may reduce operating margins as most of the investment is being made in subscription-based electronic information services which have a long lead time to build and sell, whereas the investment largely comprises people and marketing costs and is expensed as incurred. The group will also continue to execute significant long-term investment programmes for BCA and CEIC, two of its most important online information businesses, with a view to building rapidly the quality and coverage of their products as well as expanding their global sales resources.

After a strong recovery and return to revenue growth in 2010, the company will continue to pursue its successful strategy in 2011, with an emphasis on investing in technology and new subscription-based electronic information services, supplemented with small strategic acquisitions.

Padraic Fallon

Chairman

November 10 2010

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]

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 revenue is derived from emerging markets.

Appendix to Chairman's statement

Reconciliation of Consolidated Income Statement to underlying results for the year ended September 30 2010

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 and goodwill impairment, restructuring and other exceptional operating costs, 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 goodwill and intangible assets.

Further analysis of the adjusting items is presented in notes 3, 4, 5 and 7 to the Preliminary Announcement.

Consolidated Income Statement

for the year ended September 30 2010

A detailed reconciliation of the group's statutory results to the underlying results is set out in the appendix to the Chairman's Statement on page 8.

Consolidated Statement of Comprehensive Income

for the year ended September 30 2010

Consolidated Statement of Financial Position

as at September 30 2010

Consolidated Statement of Changes in Equity

as at September 30 2010

The investment in own shares is held by the Euromoney Employees' Share Ownership Trust (ESOT). At September 30 2010 the ESOT held 58,976 shares (2009: 58,976 shares) carried at a historic cost of £1.25 per share with a market value of £361,000 (2009: £220,000). 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.

Note to the Consolidated Statement of Cash Flows

Non-cash changes represent interest added to the principal amounts owed to DMGT and accrued interest on loan notes.

Notes to the Consolidated Financial Statements

1. Basis of preparation

The financial information set out in this announcement does not constitute the company's statutory accounts for the year ended September 30 2010 or 2009 but is derived from those accounts. Statutory accounts for 2009 have been delivered to the Registrar of Companies, and those for 2010 will be delivered following the company's annual general meeting. The auditors have reported on those accounts; their report was unqualified and did not draw attention to any matters by way of emphasis and did not contain a statement under s498 (2) or (3) Companies Act 2006.

Going concern, debt covenants and liquidity

The results of the group's business activities, together with the factors likely to affect its future development, performance and financial position are set out in the Chairman's Statement on pages 3 to 7.

The financial position of the group, its cash flows and liquidity position are set out in this preliminary announcement. The group meets its day-to-day working capital requirements through its $400 million dedicated multi-currency borrowing facility with Daily Mail and General Trust plc group. The facility is divided into four quantums of sterling and US dollar funds with three and five year terms with a total maximum borrowing capacity of $310 million (£197 million) and £59 million respectively. The facility's covenant requires the group's net debt to be no more than four times adjusted EBITDA on a rolling 12 month basis. At September 30 2010, the group's net debt to adjusted EBITDA was 1.28 times and the committed undrawn facility available to the group was £117.8 million. The three year quantums of the facility are due for renewal in December 2011 and the five year quantums in December 2013.

Trading conditions have significantly improved since September 2009, which has reduced the uncertainty over the level of demand for the group's products. Over the last twelve months, the exchange rate between sterling and the US dollar has been more stable than a year ago although the group remains exposed to the impact on the translation of US dollar profits and losses from its US dollar-based businesses and transactions including the gains or losses from the group's forward contracts used to partially hedge these. Bank credit is becoming more readily available and the group has no pressing requirement to arrange new finance. The group continues to operate well within the limits of its dedicated multi-currency borrowing facility and the first quantum (£64.1 million) is not due for renewal until December 2011. Any remaining funds drawn under the three year facility at this renewal date are expected to be rolled into the unused portion of the five year facility.

The group's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the group should be able to operate within the level and covenants of its current borrowing facility for the foreseeable future.

After making enquiries, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, the directors continue to adopt the going concern basis in preparing this annual report.

2. Segmental analysis

Segmental information is presented in respect of the group's business divisions and reflects the group's management and internal reporting structure. The group is organised into five business divisions: Financial publishing; Business publishing; Training; Conferences and seminars; and Databases and information services. This is considered to be the primary reporting format. Financial publishing and Business publishing consist primarily of advertising and subscription revenue. The Training division consists primarily of delegate revenue. Conferences and seminars consists of both sponsorship income and delegate revenue. Databases and information services consists of subscription revenue. A breakdown of the group's revenue by type is set out below.

Analysis of the group's three main geographical areas is also set out to provide additional information on the trading performance of the businesses.

Inter segment sales are charged at prevailing market rates and shown in the eliminations columns below.