Preliminary unaudited consolidated results

Thursday 16 December 1999

for the year ended 3rd October, 1999

The Group's unaudited results for the year have been produced in accordance with FRS 10, concerning goodwill and other intangible assets, which has necessitated the restatement of last year's results. For the Group's newspaper divisions, the results include an extra week's trading compared with last year.

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Summary

The DMGT Group had another record year with profit before tax up 9% over last year. Excluding amortisation of intangible assets and exceptional items, the underlying profit before taxation rose by 9% from £188.6 million to £205.0 million and underlying adjusted earnings per share by 12% to 134.8p. Profits would have been higher but for a considerable increase in expenditure on electronic publishing, start-ups and new product launches.

Dividend

The Directors of the Company are recommending payment on the issued Ordinary and 'A' Ordinary Non-Voting shares of the Company of a final dividend of 20.0 pence per share for the year to 3rd October, 1999 (1998 18.0 pence per share). This will make a total for the year of 29.0 pence per share (1998 26.0 pence per share). For transferees to receive this dividend, which will be paid on 18th February, 2000, transfers must be lodged with the Registrar by 6th January, 2000.

Share Split

The Directors of the Company are recommending that each of the Company's Ordinary shares of 50p be split into 4 Ordinary shares of 12.5p and each 'A' Ordinary Non-Voting share be split into 4 Ordinary A Non-Voting shares of 12.5p. A resolution will be put to Ordinary shareholders at the Annual General Meeting, to be held on Wednesday 16th February, 2000. If approved, this share split would take place in respect of transfers lodged with the Registrar by 16th February, 2000.

The Group's national newspaper division had another very successful year. Against the market trend, the average circulation of the Daily Mail rose by 2.8% and that of The Mail on Sunday by 3.3%. With the extra week's sale and with the Evening Standard achieving an unchanged average sale despite a cover price increase, overall circulation revenue was up 11% on last year. All the titles produced a strong advertising performance, up 15% in total, partly due to the increased availability of colour following the completion of the press enhancement programme.

In March 1999, Associated launched Metro, a free daily newspaper for London commuters. It has been well received by readers and its advertising revenues are growing rapidly. Since the year end, similar papers have been launched in Manchester, Birmingham and Central Scotland. Despite initial losses from this venture, Associated produced a substantial increase in operating profit.

Northcliffe Newspapers

Trading conditions for the Group's regional newspapers have been mixed this year, although with an improvement towards the end of the year. A record profit resulted from the extra week's trading, stable circulation and underlying advertising revenues, close control of costs and a contribution from acquisitions. The largest acquisition in the year, Central Independent Newspapers, was bought for £45 million at the end of September 1999 and made no contribution to these results.

DMG New Media

The Group's consumer internet division has grown with the launch of This is Money and, since the year end, of Charlotte Street, the internet site for women. A 60% interest in Soccernet was sold in June 1999. While the division continues to be loss-making, advertising revenues grew over 300% year on year.

Euromoney Institutional Investor

Euromoney Institutional Investor has already announced its results which showed a reduction in adjusted earnings of 8%, a creditable achievement considering the upheaval in the emerging markets, the source of much of its revenues. The equivalent fall at the half year stage was 29%. After the losses of Internet Securities, bought in February 1999, Euromoney's operating profit before amortisation of goodwill was down 19%.

Teletext

Teletext's analogue service had another excellent year, with its advertising revenues up over 20% over last year. The delay in the launch of digital teletext, originally scheduled for December 1998, but not yet fully achieved for reasons outside the Group's control, has been disappointing. It did, however, result in higher profits than expected, due to the postponement of launch costs. The effects of the launch of this service and of Teletext's much-expanded internet travel site should now fall into the current year.

DMG Radio Australia

DMG Radio Australia's Australian business produced a modest increase in profit, despite having to face direct competition in some of its markets for the first time. 5AA, in Adelaide, having had a difficult first half year, recovered well in the second half. The UK business expanded during the year by the purchase of stations in Tunbridge Wells and Crawley.

DMG World Media

DMG World Media (formerly DMG Exhibitions) grew considerably during the year, both by acquisition and launch. Its operating profit was up 21% on the previous year, despite two of its largest biennial shows not being held this year. This increase was largely attributable to acquisitions.

DMG Information

DMG Information also grew during the year with the purchase of e data resources, the leading supplier of environmental property information in the US. For its education businesses, it was a year of consolidation and restructuring. RMS increased its revenues and profits significantly, although there were anticipated losses from the early stage Dolphin and Landmark businesses.

Other Profit and Loss Items

The increase in central costs less rental income is due to the sale last year of the Group's investment properties. Rental income this year was minimal.

Amortisation has been charged in both years on intangible assets held historically on the Group's balance sheet and in the current year also on goodwill on acquisitions made during the year.

The two principal contributors to associated companies were GWR and Bristol United Press ("BUP"). GWR recently announced good results; those of BUP showed an 8% decline for its half year to September 1999.

Profit on sale of fixed assets arose mainly from the sale of Reuters shares. Profit on sale of businesses arose mainly from the sale of 60% of Soccernet, but also from the sale of a radio station in Sweden and of Euromoney's 100% Design exhibition.

The underlying tax charge has remained steady at just under 31% of profits. The stated tax charge represents 22% of profits.

Funding

The Group's net debt rose during the year from £416 million to £608 million, an increase of £192 million. However, average debt during the year was lower than last year and this, combined with a lower average interest rate, produced a 5% reduction in the interest charge. Acquisitions and disposals cost a net £262 million.

Post Balance Sheet Events

Since the year end, the Group has announced a recommended offer for those shares in BUP which it did not already own. The offer values BUP at £121 million and the cost to the Group will be £92 million. The offer document is expected to be posted shortly.

Outlook

The new financial year has started encouragingly, with Euromoney in particular seeing improving trading conditions. Associated's national titles continue to perform strongly and the Group's other divisions should increase their contribution to operating profits.

The Group expects again to increase significantly its expenditure on start-up and early stage businesses, notably internet-related, but also on Metro and Digital Teletext. This expenditure will be taken as a charge against earnings and will therefore restrict reported profit growth.

*Daily Mail and General Trust plc Group Cash Flow Statement for the year ended 3rd October, 1999 *

*Daily Mail and General Trust plc Group Balance Sheet as at 3rd October, 1999 *

NOTES

1 Accounting policies

The financial information for the year has been prepared in accordance with the accounting policies set out in the Group's 1998 Annual Report, as amended for the new accounting standards, FRS 10 to FRS 15 which the Group is required to adopt in its full year accounts to 3rd October, 1999. The Profit and Loss account and the Balance Sheet have been amended to reflect the adoption of FRS 10, Goodwill and Intangible Assets. The year figures have been restated to reflect the amortisation over 20 years of the Group's intangible assets (other than goodwill) from their original dates of acquisition. Goodwill has not been restated, but is capitalised on new acquisitions made after 28th September, 1998.

The Group has segmented its newspaper businesses separately this year. It has also segmented its exhibitions and related activities and its education and information publishing interests which were previously included within other media.

2 Turnover

Turnover of £38.8 million from acquisitions arose £5.2 million in regional newspapers and related activities, £5.9 million in Euromoney, £1.3 million in broadcasting, £11.4 million in exhibitions and related activities and £15.0 million in education and information publishing.

3 Operating profit

Operating profit of £1.3 million, before amortisation of intangible assets, from acquisitions arose £0.8 million in regional newspapers and related activities, a loss of £3.0 million in Euromoney, £3.2 million in exhibitions and related activities and £0.3 million in education and information publishing.

4 Other finance charges

Premium on repurchase of borrowings comprises the premium on repurchase of Exchangeable Eurobonds and in the prior year also of the Group's US $ Loan Notes. This has been treated as an exceptional item.

5 Taxation charge

The tax charge for the year amounted to £44.0 million (1998 £52.0 million). The charge for taxation has been computed at a rate of 30.5% (1998 31.0%) on UK taxable profits. The underlying tax on profits before exceptional items amounted to £62.6 million (1998 £58.0 million) and the resulting rate of tax is 30.5% (1998 30.8%).

6 Adjusted earnings per share

Adjusted earnings per share (before amortisation of intangible assets and exceptional items) are calculated on profit before amortisation of intangible assets and exceptional items, but after charging the taxation and minority interests associated with those profits, of £134.6 million (1998 £120.3 million), as set out in note 7 below, and on the weighted average of 99.8 million (1998 100.0 million) ordinary shares in issue during the year in accordance with FRS 14.

7 Profit before amortisation of intangible assets and exceptional items

8 Net cash inflow from operating activities

9 Investment in own shares

DMGT Trustees Limited, the Trustee of the DMGT Share Trust, has made purchases of the Company's 'A' Ordinary Non-Voting shares for the purpose of meeting prospective exercises of options granted under the 1997 Executive Share Option Scheme. As required by UITF 13, these are included as assets on the Group balance sheet. The £2.0 million (1998 £1.2 million) cost of buying these shares in excess of the option exercise price has been charged in arriving at operating profit.

10 Year 2000

The Group has undertaken a major exercise to ensure Year 2000 compliance. This exercise is, needless to say, all but completed and the Group believes that it has done all possible to avoid interruptions, particularly to business-critical systems. There remains some inevitable uncertainty due to external factors and particularly where the Group operates in emerging markets' countries. The cost of the exercise is difficult to assess since most expenditure involves improvement to existing systems, as well as the achievement of Year 2000 compliance, but is estimated to be approximately £12 million.

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The financial information set out above does not constitute the statutory accounts of the Company within the meaning of s.240 of the Companies Act 1985 but is derived from those accounts. Statutory accounts for the year ended 27th September, 1998 have been delivered to the Registrar of Companies. The auditors have reported on the accounts for the year ended 27th September, 1998; their report was unqualified and did not contain a statement under section 237(2) or (3) of the Companies Act 1985. The auditors have not yet reported on the accounts for the year ended 3rd October, 1999.

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Highlights of this announcement will be advertised on 16th December in the Evening Standard, on 17th December in the Daily Mail, Aberdeen Press & Journal and the Western Morning News and on 19th December in The Mail on Sunday. It is expected that the Annual Report and Accounts will be posted to shareholders on 19th January, 2000.

Enquiries: Peter Williams 0171 938 6631
Nicholas Jennings 0171 938 6629

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