Preliminary Statement

Euromoney

Institutional

Investor PLC

Preliminary Statement (unaudited)

September 30 2015

Preliminary Statement (unaudited)

November 19, 2015

· Total revenues down 1% to £403.4m

· Second half underlying1 revenues fell by 5%, due to weak commodity markets, after a 1% first half increase

· Adjusted operating margin down 4% points to 26% reflecting higher property and investment costs, impact of Dealogic transaction and the high marginal flow through from lower delegate and advertising revenues

· Adjusted profit before tax down 7% at £107.8m

· Strong operating cash conversion further strengthens balance sheet - net cash of £17.7m

· Three investments in financial technology companies completed

· Roll-out of Delphi content platform as planned, and good pipeline of new products in asset management

· Final dividend increased to 16.4p in line with policy

· First quarter trading has started in line with board's expectations and 2015 second half trends

· New board structure to be implemented

1 Underlying revenues exclude the impact of acquisitions, disposals and currency movements.

Commenting on the results, Andrew Rashbass, CEO, said:

""I am delighted and privileged to join Euromoney with its unique portfolio of businesses and outstanding people. Today's results reflect the strong headwinds, both cyclical and structural, facing many of our customers and our businesses. But they also show areas of real strength, for example around our asset-management-related businesses. They demonstrate, too, how cash generative the business is. These strengths create great opportunity. Following the completion of the strategy review which I am leading, we shall present an update to investors in early 2016. My initial impressions are that more active management of our portfolio and allocating our capital rigorously towards the best opportunities will allow us to grow existing businesses and invest in new areas too."

Highlights

Euromoney Institutional Investor PLC, the international online information and events group, achieved an adjusted profit before tax of £107.8m for the year to September 30, 2015, against £116.2m in 2014. Adjusted diluted earnings a share were 70.1p (2014: 70.6p). The directors recommend a final dividend of 16.40p (2014: 16.00p), giving a total for the year of 23.40p (2014: 23.00p) to be paid to shareholders on February 11, 2016.

Total revenues for the year were 1% behind last year at £403.4m. Underlying1 revenues, after also excluding event timing differences, decreased by 2%.  The underlying revenue trends reported for the first half for subscriptions and advertising largely continued into the second. But after first half growth, event revenues deteriorated in the second half following the downturn in commodity prices and weakness in emerging markets.

Adjusted operating profit fell by £15.6m to £104.2m. The adjusted operating margin fell from 30% to 26% as a result of a number of factors highlighted at the start of the year, including higher property costs, the full year impact of the group's investment in its Delphi content platform, and the impact of the Dealogic transaction. In addition, the margin fell by 2% points as a result of the high marginal profit on declining advertising and delegate revenues, as well as the pressure on people costs that comes from operating in the digital space.

The 7% fall in adjusted profit before tax compares to a 13% drop in adjusted operating profit, helped by a £2.5m credit (2014: £2.4m expense) following the first half decision to reverse last year's long-term incentive expense, and by an increase of £2.2m in the adjusted share of results in associates following the Dealogic transaction.

The 1% decrease in adjusted diluted earnings a share reflects the benefit of a lower underlying tax rate and a reduction in the number of shares in issue following last year's share buy-back. Earnings for dividend purposes increased by 2% and this is reflected in the increase in the final dividend.

The statutory profit before tax of £123.3m is higher than the adjusted profit before tax as a result of gains realised on a number of assets sold during the period, partly offset by acquired intangible amortisation and goodwill impairment charges.

The group continued to invest in its digital products during 2015 including rolling out the functionality of the Delphi content platform to the group's remaining titles, investing in a strong pipeline of new information services now being launched, and continuing the move to a digital-only format for many of the group's titles by the end of 2016.

The group ended the year in a net cash position for the first time since the acquisition of Institutional Investor in 1997. Net cash of £17.7m at September 30 compared with net debt of £10.6m at March 31 and £37.6m at last year end. This balance sheet position reflects the group's strong operating cash flows, supplemented by net property proceeds of £10.6m following the group's move to new London offices. This was offset by net acquisition and disposal spend of £15.6m including £11.6m for the deferred consideration on the acquisition of Insurance Insider. Underlying cash flows remain strong and there is plenty of headroom for the group to pursue selective acquisitions.

As highlighted in previous statements, trading conditions became more challenging during the second half of 2015. The investment banking, particularly fixed income, and commodities sectors, which together account for more than two thirds of the group's revenues, continue to face significant structural and cyclical headwinds, while the outlook for emerging markets also deteriorated. In contrast, the group's businesses serving the asset management industry, which are predominantly subscription-driven, have remained robust. These trading conditions are expected to continue into the first half of 2016.

Board Structure

A separate RNS has been issued today covering changes to the board's structure.

Strategy

Andrew Rashbass was appointed Executive Chairman on October 1, 2015 and is now leading the board's review of the group's strategy and its portfolio of businesses. The group plans to give investors a full strategy update early in 2016.

However, during 2015 Euromoney's strategy had been to build a robust and tightly-focused global online information business with an emphasis on both developed and emerging markets. The group continued to focus on increasing the proportion of revenues derived from electronic subscription products; investing in technology to develop existing and new electronic information services; building large, must-attend annual events; keeping the quality of its portfolio under review and eliminating products with a low margin or too high a dependence on print advertising; maintaining tight cost control; retaining and fostering an entrepreneurial culture; and using its healthy balance sheet and strong cash flows to fund selective acquisitions and strategic investments.

The group continued to invest in technology and digital products and to roll out its Delphi digital platform for authoring, storing and delivering content. By the end of September, Euromoney had completed the transition of all applicable publishing products onto the Delphi authoring system. BCA Research's new Delphi tools - BCA Analytics, its standalone interactive charting tool, and BCA Edge, its fully integrated online research service - have begun to attract significant customer support.

The group's largest organic investment in 2015 was Institutional Investor's Investor Intelligence Network and Manager Intelligence Network. These capital introduction networks bring together institutional investors and asset managers from around the world in two separate but linked digital communities that allow them to connect, share knowledge and put capital to work. Revenues will come from capital introduction fees, data services, platform fees and, subject to regulatory approval in the US being obtained, which is now expected in spring 2016, the ability to charge basis points on capital placed.

The group made three minority investments in financial technology companies in 2015. The first was a 15.5% equity stake in Dealogic in December 2014, alongside the Carlyle Group which acquired a controlling interest. Further details of the Dealogic transaction are provided later in this report.

Secondly, in July 2015 the group acquired a 10% equity interest in Estimize, the most comprehensive crowd-sourced financial estimates platform, for a consideration of $3.6m. Estimize sources company earnings and estimates from over 7,000 hedge fund, brokerage and independent analysts as well as a diverse community of individuals. By being more representative of market expectations, Estimize has proved to be an especially accurate forecaster of company earnings. Estimize is working with BCA Research to develop new datasets, and BCA's extensive list of buy-side clients now has access to data and insights from Estimize.

Thirdly, in September 2015 the group acquired a 9.9% interest in Zanbato, an international private capital placements platform for $5.4m. Founded in 2010, Zanbato (www.zanbato.com) is based in California and builds technology to address inefficiencies in private capital markets. Zanbato's Marketplace software allows institutional investors and family offices to review private investment opportunities in pre-IPO company shares and real estate. Zanbato and Institutional Investor have also entered into a joint venture to bring together the technology of Zanbato and the market reach of Institutional Investor's Investor Intelligence Network to serve the institutional segment of the private placements market.

In 2015, the group also disposed of some non-strategic assets, predominantly print-based newsletters and magazines.

Currency

As highlighted in previous statements, the group generates approximately two thirds of both its revenues, including approximately a third of its UK revenues, and profit before tax in US dollars. The exposure to US dollar revenues in its UK businesses is hedged using forward contracts to sell US dollars, which delays the impact of movements in exchange rates for at least a year. However, the group does not hedge the foreign exchange risk on the translation of overseas profits. While it endeavours to match foreign currency borrowings with investments, as debt levels have fallen the related foreign currency finance cost has been of only limited benefit as a hedge against the translation of overseas profits.

The strength of the US dollar has had a favourable impact on the translation of overseas profits. The average sterling-US dollar rate for the year to September 30 was $1.55 (2014: $1.66). This improved headline revenue growth rates for the year by approximately three percentage points and adjusted profit before tax by approximately £7m. Each one cent movement in the US dollar rate has an impact on profits on translation of approximately £0.6m on an annualised basis.

The revenue tables below show headline growth rates. Underlying1 revenue growth rates exclude the impact of acquisitions, disposals and currency movements.

Dealogic Transaction

Euromoney acquired a 15.5% equity interest, and 20% of the voting rights, in Dealogic in December 2014. This investment was funded through the sale to Dealogic of Euromoney's interests in two businesses, Capital DATA and Capital NET, which Dealogic and Euromoney had operated since the 1980s. The transaction valued Euromoney's participation in these two businesses at $85m, for which Euromoney received equity in Dealogic valued at $59m, cash of $5m, and preference shares of $21m which are redeemable in December 2015. The transaction generated a gain on sale of £48m which has been included in exceptional items.

For the year to September 30, 2014, Euromoney's subscription revenues and adjusted operating profits included licence fees of £5.4m from its investment in Capital DATA. For the same period, Euromoney recognised a profit after tax of £0.3m from its 48.4% associate interest in Capital NET. In financial year 2015, for the three months prior to the transaction Euromoney recognised subscription revenues of £1.2m from Capital DATA and a profit after tax of £0.1m from Capital NET. For the nine months subsequent to the transaction, Euromoney recognised an adjusted share of profit in associates of £2.4m from Dealogic. As well as reducing the group's adjusted operating margin by 1% point, the transaction diluted Euromoney's 2015 adjusted after-tax earnings by approximately 2%.

With its strong brand and global use among investment banks, Dealogic offers Euromoney attractive strategic potential. The Dealogic transaction has significant potential long-term financial upside but, as highlighted at the time of the transaction, in the short-term the loss of earnings from the Capital DATA and Capital NET arrangements have more than offset the group's share of profits from the Dealogic associate interest.

Trading Review

Total revenues decreased by 1% to £403.4m. Underlying1 revenues, after also adjusting for unfavourable event timing differences, decreased by 2%. A 1% increase in the first half was followed by a 5% decrease in the second, largely due to weakness in the commodities sector.

Trading has remained difficult, particularly in investment banking, where tougher regulation, increased compliance costs and significant fines levied by regulators have led to banks reducing headcount and cutting spend on marketing and information. The commodities sector has also suffered from oversupply, falling prices and lower trading volumes. In contrast, the performance of the group's asset management businesses has remained robust throughout the year, and subscription revenues, particularly for data and research products, have proved resilient. Emerging markets, which account for more than a third of the group's revenues, have proved challenging with increased geopolitical risk and weakening currencies.

Growth in underlying1 subscriptions partly offset the declines experienced in advertising and event revenues. Underlying1 subscription revenues have been increasing at a steady rate of 2% for the past two years from a combination of new products and a robust asset management sector. After first half growth of 5%, underlying1 event revenues (after also excluding event timing differences) declined by 9% in the second half due mainly to weakness in the commodities sector. Most of the group's larger events have performed well, particularly in the specialist finance and wholesale telecoms sectors, but this has been more than offset by the weaker performance from smaller events and training which traditionally struggle more in difficult markets. Underlying1 advertising revenues continued to decline as a result of the structural and cyclical headwinds which have reduced banks' marketing spend, and more recently due to reductions in energy company advertising in response to weak oil prices.

The adjusted operating margin fell from 30% to 26% as a result of a number of factors highlighted at the start of the year, including higher property costs, the full year impact of the group's investment in its Delphi content platform, and the impact of the Dealogic transaction. In addition, the adjusted operating margin fell by nearly 2% points as a result of the high marginal profit on declining advertising and delegate revenues. Permanent headcount has fallen by 23 to 2,168 people since September 30, 2014 but like many businesses operating in the digital space the group continues to experience increases in people costs in excess of inflation, particularly in technology, data and research.

Business Review

The research and data division, with its revenues derived predominantly from subscription services, held up well during the year. Financial publishing continued to suffer from the structural and cyclical challenges facing global investment banks, while business publishing, which is less advertising dependent, was more robust. The conferences, seminars and training division had a difficult year after the sharp downturn in energy markets in the second half. This particularly hit the training business with the impact felt from reductions in training spend both from the energy sector itself as well as from banks in energy-dependent economies, many of them in emerging markets.

Research and data: the asset management sector remained robust throughout 2015 and renewal rates at BCA and NDR remained high. However, the group's emerging market information and data products, CEIC and EMIS, which generate a significant proportion of their revenues from local emerging markets as well as the banking sector, fared less well. As a result, underlying1 revenues for the division were flat. The adjusted operating margin fell 2% to 35% due to amortisation at BCA for its new Delphi content platform, investment at CEIC in content automation, and new product and sales investment at EMIS.

Financial publishing: underlying1 revenues decreased by 6% reflecting continued weakness in the group's financial titles and their dependence on bank advertising. In contrast, subscription revenues for the division increased, including strong growth from Insider Publishing, the insurance information business acquired in 2013, and Euromoney TRADEdata, the group's derivative data business. The adjusted operating margin fell 3% to 25% reflecting amortisation for GlobalCapital's Delphi content platform, and increased technology spend, particularly for HedgeFund Intelligence.

Business publishing: underlying1 revenues were flat despite a strong performance from the wholesale telecoms business, TelCap, which was offset by the challenging energy markets faced by Gulf Publishing. Despite tougher metals markets, Metal Bulletin's revenues held up well. The adjusted operating margin improved from 34% to 35% attributable to the strong performance of TelCap and an improving margin for Metal Bulletin following a period of investment in its steel information service and pricing database.

Conferences, seminars and training: the 7% decrease in underlying1 revenues is primarily attributable to the difficult market conditions faced by the group's commodities-related events, including metals and coal, particularly during the second half. Even after adjusting for some unfavourable events timing, this commodities weakness more than offset the strength of Institutional Investor's subscription-based memberships for the asset management industry which continued to grow at double digit rates. The adjusted operating margin dropped 2% to 25% reflecting the high margin flow through from lower delegate revenues, and investment in e-learning products for Euromoney's training division. The increase in headline event revenues reflects the acquisition of Mining Indaba in July 2014, which achieved revenues of more than £9m the first time it was run under Euromoney ownership in February 2015.

Financial Review

The 7% fall in adjusted profit before tax to £107.8m compares to a 13% drop in adjusted operating profit. This partly reflects a £2.5m credit (2014: £2.4m expense) following the first half decision to reverse last year's CAP expense on the grounds that management believe it is unlikely the minimum performance target under CAP 2014, the group's long-term incentive plan, will be achieved in 2017. In addition, the Dealogic transaction gave rise to an increase of £2.2m in the adjusted share of results in associates.

The 1% decrease in adjusted diluted earnings a share reflects the benefit of a lower underlying tax rate and a reduction in the number of shares in issue following last year's share buy-back. The adjusted effective tax rate for the year was 18% against 22% for 2014 as the group continues to benefit from reductions in the UK corporate tax rate and the tax effects of acquisitions. The tax rate in each year depends mainly on the geographic mix of profits and applicable tax rates.

The statutory profit before tax of £123.3m is higher than the adjusted profit before tax due to a net exceptional credit of £33.4m (see note 3), offset by acquired intangible amortisation of £17.0m. The net exceptional credit mostly arises from profits on assets sold during the year, less goodwill impairment charges including a second half charge of £10.7m for Mining Indaba to reflect the sharp downturn in the commodities sector which is not expected to reverse in the near term. A detailed reconciliation of the group's adjusted and statutory results is set out in the appendix to this statement.

Net Cash, Cash Flow and Dividend

Net cash at September 30 was £17.7m compared with net debt of £10.6m at March 31 and £37.6m at last year end. This balance sheet position reflects the group's strong operating cash flows, as well as net property proceeds of £10.6m following the group's London office move. This was offset by net acquisition and disposal spend of £15.6m including £11.6m for the deferred consideration on the acquisition of Insurance Insider.

The operating cash conversion rate was 105% (2014: 92%). The rate was more than 100% due to the favourable effect of the rent-free period on the new London offices. The rate was less than 100% in 2014 after the vesting of options under CAP 2010 triggered cash outflows of approximately £9m for which the expense was accrued in previous years. After adjusting for these timing differences, the underlying operating cash conversion rate in each year was 101% (2014: 100%).

The group has a US$160m (£106m) dedicated multi-currency borrowing facility from Daily Mail and General Trust plc, the group's parent, which expires in April 2016. The group has no significant outstanding acquisition commitments for 2016 and expects to receive a further $21m in December 2015 from the redemption of preference shares as part of the Dealogic transaction. The need for, and size of, a new borrowing facility will therefore depend on the group's expected borrowing requirements at the time the facility expires, including its acquisition pipeline.

The company's policy is to distribute a third of its adjusted after-tax earnings by way of dividends. In line with its policy, the board recommends a final dividend of 16.40p a share (2014: 16.00p), to be paid to shareholders on February 11, 2016, giving a total dividend for the year of 23.40p a share (2014: 23.00p).

Outlook

Andrew Rashbass was appointed Executive Chairman on October 1, 2015 and is now leading the board's review of the group's strategy and its portfolio of businesses. The group plans to give investors a full strategy update early in 2016.

The first quarter has started as expected with a continuation of the challenging market conditions experienced in the second half of financial year 2015. The group's activities in the investment banking and commodities sectors, which together account for more than two thirds of the group's revenues, continue to face significant structural and cyclical headwinds, while the outlook for emerging markets remains weak. In contrast, the group's businesses serving the asset management industry, which are predominantly subscription-driven, have remained relatively robust. These conditions are expected to continue for the foreseeable future and the revenue trends experienced in the second half of 2015 are continuing into the first half of 2016.

1 Underlying revenues exclude the impact of acquisitions, disposals and currency movements.

END

For further information, please contact:

Euromoney Institutional Investor PLC

Andrew Rashbass, CEO: +44 20 7779 8300; [email protected]

Colin Jones, Finance Director: +44 20 7779 8666; [email protected]

FTI Consulting

Charles Palmer: +44 20 3727 1400; [email protected]

Appendix to Preliminary Statement (unaudited)

Reconciliation of Consolidated Income Statement to adjusted results for the year ended September 30 2015

The reconciliation below sets out the adjusted 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.

Adjusted figures are presented before the impact of amortisation of acquired intangible assets (comprising trademarks and brands, databases and customer relationships), exceptional items, share of acquired intangibles amortisation and tax in associates and joint ventures, net movements in acquisition deferred consideration and acquisition commitments. 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, 7, 8 and 9 to the Preliminary Statement.

Consolidated Income Statement

for the year ended September 30 2015 

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

Consolidated Statement of Comprehensive Income

for the year ended September 30 2015

Consolidated Statement of Financial Position

as at September 30 2015

Approved by the board on November 19, 2015. 

Consolidated Statement of Changes in Equity

for the year ended September 30 2015

The investment in own shares is held by the Euromoney Employees' Share Ownership Trust (ESOT) and Euromoney Employee Share Trust (EEST). The EEST was incorporated in February 2014 to facilitate the purchase of shares for the Capital Appreciation Plan 2014. The trusts waived the rights to receive dividends. Interest and administrative costs are charged to the profit and loss account of the trusts 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 2015

Cash and cash equivalents include bank overdrafts.

Note to the Consolidated Statement of Cash Flows

The group's debt is provided through a dedicated multi-currency borrowing facility from Daily Mail and General Trust plc (DMGT). The total maximum borrowing capacity is US$160m (£106m) facility which expires at the end of April 2016. Interest is payable on this facility at a variable rate of between 1.35% and 2.35% above LIBOR dependent on the ratio of adjusted net debt to EBITDA. The facility's covenant requires the group's net debt to be no more than three times adjusted EBITDA on a rolling 12 month basis. Failure to do so would result in the group being in breach of the facility, potentially resulting in the facility being withdrawn or impediment of management decision making by the lender. Management regularly monitor the covenant and prepare detailed debt forecasts to ensure that sufficient headroom is available and that the covenants are not close or potentially close to breach. At September 30 2015, the group's net cash to adjusted EBITDA was (0.15) times and the committed undrawn facility available to the group was £106m given the loan was paid in full.

In the absence of any significant acquisitions, the group has no pressing requirement to arrange new finance before the facility expires in April 2016 and the group intends to replace it with a new borrowing facility, the amount and terms of which will depend on its expected borrowing requirements at the time. There is a risk that the undrawn portion of the facility, or that the additional funding, may be unavailable or withdrawn if DMGT experiences funding difficulties themselves. However, if DMGT were unable to fulfil its funding commitment to the group, the directors are confident that the group would be in a position to secure adequate external facilities, although at a higher cost of funding.

The group's strategy is to use excess operating cash to deposit with DMGT or pay down its debt. As at September 2015, the group repaid the multi-currency borrowing facility from DMGT in full. The group generally has an annual cash conversion rate (the percentage by which cash generated from operations covers operating profit before acquired intangible amortisation, long-term incentive expense and exceptional items) of 100% or more due to much of its subscription, sponsorship and delegate revenue being paid in advance. The group's operating cash conversion rate was 105%. The underlying operating cash conversion rate is 101% compared to 100% in 2014.

Notes to the Preliminary Statement

1 Basis of preparation

While the financial information contained in this unaudited preliminary announcement has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board as adopted by the European Union, this announcement does not itself contain sufficient information to comply with IFRS.

The information for the year ended 30 September 2015 does not constitute statutory accounts for the purposes of section 435 of the Companies Act 2006. A copy of the accounts for the year ended 30 September 2014 has been delivered to the Registrar of Companies. The auditor's report on those accounts was not qualified and did not contain statements under section 498(2) or 498(3) of the Companies Act 2006. The audit of the statutory accounts for the year ended 30 September 2015 is not yet complete. These accounts will be finalised on the basis of the financial information presented by the Directors in this preliminary announcement and will be delivered to the Registrar of Companies following the Company's annual general meeting.

The loan (repaid to)/received from DMGT group company in the 2014 Consolidated Statement of Cash Flows has been re-presented to show the allowable netting of the draw downs and repayment of amounts from a committed facility with DMGT group company.

The 2014 Consolidated Statement of Financial Position has been re-presented to reflect a reclassification to net down certain balances within trade receivables of £8.5m, accrued income of £4.0m and deferred income of £12.4m. This has a corresponding impact on the working capital movements in the Consolidated Statement of Cash Flows. This reclassification has no impact on net assets or net cash and cash equivalents.

Accounting policies

The consolidated financial statements have been prepared under the historical cost convention, except for the revaluation of certain financial instruments.

The same accounting policies, presentation and methods of computation are followed in these financial statements as were applied in the group's 2014 annual audited financial statements, except as described below.

· IFRS 10 'Consolidated Financial Statements'. This standard builds on existing principles by identifying the concept of control as the determining factor in whether an entity should be included within consolidated financial statements. The amendments do not have an effect on these consolidated financial statements.

· IFRS 11 'Joint Arrangements' provides for a more realistic reflection of joint arrangements by focusing on the rights and obligations of the arrangement, rather than its legal form. The amendments do not have an effect on these consolidated financial statements.

· IFRS 12 'Disclosure of Interests in Other Entities' includes the disclosure requirements for all forms of interests in other entities, including joint arrangements, associates, special purpose vehicles and other off balance sheet vehicles. The amendments do not have a material effect on these consolidated financial statements.

· IAS 27 (revised) 'Separate Financial Statements (2011)' now contains requirements relating only to separate financial statements as the new IFRS 10 'Consolidated Financial Statements' addresses the requirements for consolidated financial statements. The amendments do not have an effect on these consolidated financial statements.

· IAS 28 (revised) 'Investments in Associates and Joint Ventures (2011)' includes the requirements for joint ventures, as well as associates, to be equity accounted following the issue of IFRS 11. The amendments do not have an effect on these consolidated financial statements.

· Amendments to IAS 32 'Offsetting Financial Assets and Financial Liabilities' provide clarification on the application of offsetting rules relating to financial assets and financial liabilities. The amendments do not have a significant effect on these consolidated financial statements.

· Amendments to IFRS 10, 11, and 12 on transition guidance clarify the 'date of initial application' in IFRS 10, and provide relief in IFRS 11 and 12 from the presentation or adjustment of comparative information for periods prior to the immediately preceding period. The amendments do not have a significant effect on these consolidated financial statements.

· Amendments to IFRS 10, IFRS 12 and IAS 27 on 'Consolidation for Investment Entities' define an investment entity and introduce an exception to consolidating particular subsidiaries for investment entities. The amendments do not have an effect on these consolidated financial statements.

· Amendments to IAS 36 on Recoverable Amount Disclosures for Non-financial Assets remove certain disclosures of the recoverable amounts of CGUs. The application of these amendments has no material impact on the disclosures in these consolidated financial statements.

· Amendments to IAS 39 on Novation of Derivatives and Continuation of Hedge Accounting provide relief from discontinuing hedge accounting when novation of a derivative designated as a hedging instrument meets certain criteria. The application of these amendments has not had any material impact on these consolidated financial statements.

Going concern 

Having assessed the principal risks and the other matters discussed in connection with the viability statement, the directors consider it appropriate to adopt the going concern basis of accounting in preparing this annual report.

2 Segmental analysis

1. Operating profit before acquired intangible amortisation, long-term incentive credit/(expense) and exceptional items (refer to the appendix to the Preliminary Statement).

2. Acquired intangible amortisation represents amortisation of acquisition-related non-goodwill assets such as trademarks and brands, customer relationships and databases (note 8).

The group has taken advantage of paragraph 23 of IFRS 8 'Operating Segments' and does not provide segmental analysis of net assets as this information is not used by the directors in operational decision making or monitoring of business performance.

3 Exceptional items

Exceptional items are items of income or expense considered by the directors, either individually or if of a similar type in aggregate, as being either material or significant and which require additional disclosure in order to provide an indication of the underlying trading performance of the group.

For the year ended September 30 2015 the group recognised an exceptional credit of £33.4m. During the year the group disposed of its interests in a number of assets generating a gain on sale of £55.1m. Most of this relates to the sale of group's interests in Capital DATA and Capital NET as part of the Dealogic transaction (note 9). The group also sold a number of predominantly print-based newsletters and magazines (note 10) as well as certain freehold and leasehold properties as part of the relocation of its London offices.

Following the sharp downturn in the commodities sector in 2015 and no sign that market conditions will improve over the near term, the group has impaired the value of its investment in the Investing in African Mining Indaba ("Mining Indaba"), originally purchased in July 2014, by £10.7m. The group expects Mining Indaba to recover strongly once commodity markets pick up and will continue with its strategy set out at the time of the acquisition to develop the event's investor content and networking opportunities and to use its expertise in emerging markets, as well as its international network, to accelerate growth outside Africa.

The acquisition goodwill for Centre for Investor Education ("CIE") has been subject to an impairment charge of £2.9m. See below for further details.

The remaining £4.8m charge for goodwill impairment relates to HedgeFund Intelligence ("HFI"), the group's information and events business serving the hedge fund industry. The performance of the business since the last year end has been disappointing but for 2016 HFI products have moved onto the Delphi content platform which will significantly enhance their quality.

Restructuring and other exceptional costs cover the major reorganisation of certain businesses initiated in the first half, costs relating to the relocation of the group's London headquarters, and professional fees resulting from the CIE dispute.

The group's tax charge includes a related tax charge on these exceptional items of £1.0m (note 5).

Centre for Investor Education Limited ("CIE")

In April 2013 the group acquired a 75% equity interest in CIE for a final consideration of £10.2m, with a commitment to acquire the remaining 25% by early 2016. At September 30 2014 based on the reported financial performance of CIE up to that date, the liability for the acquisition commitment was valued at £3.5m and the acquisition deferred consideration was valued at £1.7m. However, as part of the local statutory audit of CIE for the year to September 30 2014, a number of governance and financial irregularities were identified which remain subject to legal resolution. As a result of these irregularities, the former owner-managers of CIE were replaced and a number of adjustments made to the group's investment in CIE. The acquisition goodwill has been subject to an impairment charge of £2.9m. The group, in preparation of these financial statements at September 30 2015 has examined all evidence, including its own management investigation and Deloitte & Touche LLP Australia's findings, in reaching the conclusion that no further amounts are payable under the share purchase agreement for CIE. In October 2015, the group filed a public statement of claim against the previous owners for breaches of warranties and other damages.

As a result, the group has revised its prior estimate of acquisition commitments in respect of CIE which has given rise to a credit of £3.5m and acquisition deferred consideration of £1.7m included in net finance income as a fair value adjustment (note 4). The group has also de-recognised the non-controlling interest in equity.

For the year ended September 30 2014 the group recognised a net exceptional credit of £2.6m. This comprised an exceptional credit for the profit on disposal of MIS Training offset by exceptional acquisition costs, restructuring and property costs, and impairment of carrying value of associate. The restructuring and other exceptional costs of £3.8m include acquisition costs of £0.9m for the acquisitions of Infrastructure Journal and Mining Indaba, costs of £1.5m for the relocation of the group's London headquarters and restructuring costs of £1.3m from the reorganisation of certain businesses including closure of print products. The group's tax charge included a related tax charge of £0.3m.

4 Finance income and expense