Group Interim Results

Thursday 25 May 2006

Group interim results for the half year ended 2nd April, 2006.

• Robust results in difficult trading conditions for our consumer businesses.
• Good progress on regional newspaper restructuring.
• Encouraging growth in non-newspaper businesses.

*(before amortisation and impairment of intangible assets including software amortisation, restructuring costs and non-recurring items; see Consolidated Income Statement and reconciliation in Note 8).

+ All references to prior period numbers are to figures prepared under International Financial Reporting Standards (IFRS) in place of UK Generally Accepted Accounting Principles (UK GAAP).

A webcast of the Interim Results presentation to City analysts will be available for viewing from 9.30 a.m. on 25th May, 2006 at http://www.dmgt.co.uk.

Enquiries

Peter Williams Tel: 020 7938 6631
Nicholas Jennings Tel: 020 7938 6625
Kirstie Hamilton / Peter Hewer Tulchan Communications Tel: 020 7353 4200

Summary

The Group made an adjusted profit before tax* of £108.7 million for the six months to 2nd April, 2006, an increase of 7% compared with the equivalent figure for the previous year.

This result reflects a good trading performance particularly from our business to business and fast expanding digital activities. Consumer advertising revenues have been depressed and our newspaper divisions have been reducing costs to protect their profits.

The Group's results have been produced for the first time in accordance with International Financial Reporting Standards; the prior interim period's results have been restated, reducing adjusted profit before tax* by £13 million.

Statutory profit before tax for the period is £184.8 million, up 93% on last year due to the inclusion of profits on disposal of businesses.

Outlook

The Group's business-facing divisions continue to see strong growth in revenues and are finding new opportunities to expand their activities profitably. We expect these businesses to produce a good result for the year.

At Associated Newspapers, circulation figures are solid and we are seeing some modest improvement in the display advertising market for our national titles ,but not in their classified advertising. We are encouraged by the progress being made on the further restructuring of Northcliffe, but there is little sign of an advertising recovery in regional newspaper titles. Nevertheless, we still hope to achieve modest progress for the full financial year compared to
last year.

National Newspapers and related activities

Associated Newspapers' operating profit*, compared to the first half of 2005, was down by £4.9 million to £39.1 million on revenues down £29 million to £459 million. These results include those of the newspaper operations, Associated's digital activities and also the operations of Teletext which is now reported within this division.

Circulation revenues for the period from Associated's newspaper operations were broadly unchanged at £180 million, compared with £181 million in the prior period. The Daily Mail continued to increase its share of the national newspaper market and on 24th April 2006, it increased its Monday to Friday cover price by 5 pence, the first such increase for nearly five years. The Mail on Sunday performed in line with the market for the six-month period to March 2006. The Evening Standard again reduced the year-on-year decline in its paid-for circulation. Metro's distribution continued to average over one million copies and increased by 10% in March as a result of new franchises in Liverpool and Cardiff. Metro was launched in Dublin as a joint venture in December 2005.

Display advertising revenues fell by 9% to £175 million due to lower volumes. Classified advertising fell by 9% to £53 million. The advertising market remains volatile and very short term, but there have been some recent signs of a slight recovery in display advertising. Combining March and April (chosen to eliminate the effect of Easter being in April this year and March last year), newspaper display revenue was up 0.4% year on year and we expect May also to show some year on year growth.

Margins on Associated's titles have improved slightly despite a newsprint price increase from 1 January. Pension costs have fallen, partly as a result of a restructuring of benefits last year. The Evening Standard in particular has significantly reduced its cost base.

*References to operating profit in the narrative above are to adjusted operating profit (before amortisation and impairment of intangible assets including software amortisation, restructuring costs and non-recurring items); see "note 2"#note2 .

+ All references to prior period numbers are to figures prepared under IFRS in place of UK GAAP.

Associated's digital operations including Jobsite, Find a Property and Prime Location, increased their revenues by 53% to £21 million. Excluding the effect of acquisitions made since the first half of last year, revenues increased by 26%. The property website, primelocation.com, which was acquired in January, is trading well. Allegran, which operates a portfolio of dating web sites, and DMR, operating carsource.co.uk, were acquired towards the end of the period.

Revenues from Associated's television-related activities, including Teletext, fell by 16% to £25 million. Advertising revenue from Teletext's analogue services fell by 23% year on year, but revenues from its digital services rose by 50%. In May, Teletext accepted retrospective revised licence terms from the Independent Television Commission, the benefit of which has been reflected in these results.

Regional newspapers and related activities

Northcliffe's operating profit* fell by £0.8 million to £39.1 million on revenue which was down 4% to £247 million.

Circulation revenues of £49 million were unchanged from the same period last year. In the July to December 2005 ABC period, Northcliffe morning and evening daily titles declined less than industry average circulation figures.

Advertising revenues in the UK fell by 6.4% (7.5% if adjusted for the effects of a later Easter this year). Excluding recruitment revenues, which declined by 14%, advertising revenues were 3% lower. Property (up 7%) continued to grow, but motors fell by 14%. Revenues from digital publishing were 20% above those of the same period last year.

For the four months to April 2006, (excluding Aberdeen Journals which was sold on 2nd April), UK advertising revenues were down 8.5%. By category, property was up 7%; recruitment and motors were each down by 18%, although the rate of decline in recruitment revenues has slowed somewhat.

UK publishing costs in the period were 5% lower than in the previous period, despite suffering a newsprint price increase and significantly higher energy costs.

Northcliffe UK restructuring

The extended Aim Higher programme of organisational and structural improvements continues. Annualised cost reductions from the programme are currently running at around £28 million. Staff numbers have fallen from around 6,800 (excluding Aberdeen Journals) in June 2005 to around 5,950 at the end of April 2006. We are confident of achieving our announced target of £45 million cost reduction by the end of September 2007.

At the end of March, we announced that Northcliffe would be reorganised on a regional basis and would collaborate more closely with Associated in some areas. The new structure has been put in place, organising Northcliffe into six regions. This has resulted in a number of management departures and a reduction in the size of Northcliffe's London office. Combined printing and digital operations have already been established.

A restructuring charge of £14.8 million has been taken which includes the costs for the second phase of Northcliffe's reorganisation programme, together with the professional costs of the strategic review of the business.

*References to operating profit in the narrative above are to adjusted operating profit (before amortisation and impairment of intangible assets including software amortisation, restructuring costs and non-recurring items); see note 2 .

+ All references to prior period numbers are to figures prepared under IFRS in place of UK GAAP.

Information publishing

DMG Information increased its operating profit* by £9.9 million to £24.1 million on revenues up 26% to £154 million.

The business to business division grew its revenues by 33% to £104 million and operating profit* rose by £10.0 million (52%) to £29.2 million. The main contributors to this strong performance were Risk Management Solutions, Environmental Data Resources, Trepp and Landmark, with the latter benefiting from a resurgent UK residential market. Each business is seeing strong demand
for broadening product portfolios and was able to improve margins, despite continued investment in new initiatives. Trepp, serving the buoyant commercial mortgage-backed securities market, has had a particularly strong first half.

Within the careers division, the seasonal first half losses were at a similar level to last year. However, forward bookings are higher which should convert into improved profits in the second half year. Revenues increased by 14% with Hobsons up 17%, where the US business in particular grew well, and Study Group up 14%.

Financial publishing

Euromoney Institutional Investor increased its operating profit* by £0.1 million to £15.0 million on revenues up 18% to £103 million. This result was achieved despite charging £2.3 million for the cost of its capital appreciation plan which was implemented in the second half of the prior year. Excluding this cost, underlying operating profit* rose by 17%.

Revenue for the first half exceeded £100 million for the first time and strong organic growth helped drive record underlying operating profits. Encouragingly, all divisions increased operating profits* and subscription revenues grew at their highest rate for some time. As last year, revenue growth came predominantly from the event businesses, with only limited growth in
advertising. These positive trends have continued into the third quarter.

Exhibitions

dmg world media's operating profit* rose by £0.3 million to £17.0 million on revenues up 11% to £100 million. It saw the same divergence in results as the Group overall, with several of its consumer events struggling, but its business shows performing strongly. The home and garden shows had a tough period with operating profits* down by 23%. Attendances at the Daily Mail Ideal Home Show were 10% lower than the previous year, but attendees generally stayed longer
and spent more than expected.

Within the other sectors, operating profits* rose significantly with particularly good performances from Palm Beach 3, the contemporary art, sculpture and photography show, and SurfExpo in Florida, from Index (which was not held in the previous financial year) and Big 5 in Dubai, and particularly from AdTech's online marketing show and conference in New York.

*References to operating profit in the narrative above are to adjusted operating profit (before amortisation and impairment of intangible assets including software amortisation, restructuring costs and non-recurring items); see note 2 .

+ All references to prior period numbers are to figures prepared under IFRS in place of UK GAAP.

Broadcasting

Broadcasting now comprises purely the operations of DMG Radio in Australia. It made an operating loss* of £1.9 million, a fall of £2.6 million on revenue which was up 23% to £20 million despite a slowing radio advertising market. The fall was due to the launch costs and start-up losses of the new Vega radio stations in Sydney and Melbourne, offset partly by improving results from the newest Nova stations in Brisbane and Adelaide. The Vega launches have been
disappointing, with audiences slow to build, and changes are currently being implemented.

The Nova stations were again number one in the five main cities in the 18-24 age group in the most recent survey, as well as being the leading national network in its target market of listeners under 40. The Brisbane Nova, launched only in April 2005, has already become the leading station in the city.

Joint ventures and associates

The Group's share of the results* of its joint ventures and associates (after tax) fell by £1.5 million to £2.2 million due mainly to the absence of a contribution from GWR Group plc (which merged into GCap Media plc in May 2005 and is now held as a trade investment).

Other income statement items

The charge for amortisation of intangible assets increased by £9.4 million to £21.9 million and an impairment charge was made of £7.8 million.

Other gains and losses of £132.1 million arose principally from the £122 million profit on sale of Aberdeen Journals. They also included defined benefit pension scheme finance income of £10.0 million, an increase of £5.3 million.

Investment revenue, chiefly interest on deposits, increased by £4.8 million to £14.2 million. Finance costs, mainly interest payable on loans and bonds, rose by £3.1 million to £39.2 million.

After removing the effect of amortisation and impairment, restructuring costs and significant non-recurring items, the adjusted tax rate for the interim period is 31.9% (2005: 28.5%). The 2006 interim tax rate is higher than that of the prior period as 2005 marked the final period when prior year US tax losses were recognised in the income statement.

The 2006 full year tax rate is expected to be slightly higher than the interim tax rate due to the timing of when profits arise in various jurisdictions. The actual amount of tax paid is not affected by these changes.

*References to operating profit or loss in the narrative above are to adjusted operating profit or loss (before amortisation and impairment of intangible assets including software amortisation, restructuring costs and non-recurring items); see note 2 .

*References to share of the results of joint ventures and associates in the narrative above are to adjusted share of the results of joint ventures and associates (before amortisation and impairment of intangible assets); see "note 3"#note3 .

+ All references to prior period numbers are to figures prepared under IFRS in place of UK GAAP.

Net debt

Net debt at the end of the period was £765 million, a reduction of £2 million since the year end. Operating cash flows and disposal proceeds of £126 million were offset mainly by acquisitions of £127 million and capital expenditure of £51 million, principally Associated's new plant at Didcot.

The principal acquisitions during the period were three digital businesses bought by Associated, Prime Location, Allegran and DMR, for a total upfront cost of £80 million. There were also payments of deferred consideration totalling £33 million. Disposals of investments and businesses arose principally from the sale of Aberdeen Journals on 2nd April, 2006.

Since the period end, DMG Information has completed the acquisition of Genscape, a US business providing information and publications on the power industry, for $130 million (£71 million).

IFRS

DMGT's IFRS 2005 unaudited interim and full year audited primary statements for the year ended 2nd October, 2005, together with its new accounting policies under IFRS, are available in full on the Company's website, dmgt.co.uk. As previously reported, the main differences are in respect of employment benefits (pensions), share-based payments, goodwill, dividends and deferred tax.

Dividend

The Board has declared an interim dividend of 4.05 pence per Ordinary `A' Ordinary Non-Voting share (2005 3.75 pence) which will be paid on 7th July, 2006 to shareholders on the register at the close of business on 9th June,2006.

The Viscount Rothermere
Chairman

Daily Mail and General Trust plc

Consolidated Income Statement

Daily Mail and General Trust plc

Consolidated Statement of Recognised Income and Expense

Shareholders' equity reconciliation

Daily Mail and General Trust plc

Consolidated Cash Flow Statement

Daily Mail and General Trust plc

Consolidated Balance Sheet

Approved by the Board of Directors on 24th May, 2006.

NOTES

1. Basis of preparation

DMGT has historically prepared its audited annual accounts and unaudited interim results in accordance with U.K. generally accepted accounting practice (UK GAAP). Following European regulation issued in 2002, the Group will now present its Annual report and accounts in accordance with International Reporting Standards (IFRS).

The IFRS information for the year ended 2nd October, 2005 is a restatement of information extracted from the statutory financial statements prepared under UK GAAP on the historical cost basis. Those statutory financial statements were filed with the Registrar of Companies. The auditors' report on those accounts was unqualified and did not contain statements under section 237(2) or 237 (3) of the Companies Act 1985. The restated IFRS information provided for the year ended 2nd October, 2005 does not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. However, they are anticipated to form the comparative period statutory accounts for the year ending 1st October 2006, the Group's first Annual Report to be prepared in accordance with IFRS. The financial information for the six months ended 2nd April, 2006 has been the subject of an independent review by the auditors.

The unaudited interim results for the six months ended 3rd April 2005 and 2nd April 2006 have been prepared by the Group using its best knowledge of the expected IFRS and accounting policies that will be applied when the Group prepares its first set of IFRS financial statements for the year ending 1st October, 2006. There is, however, a possibility that some changes to these
policies will be necessary when preparing the full annual financial statements as the Interim Consolidated Financial Statements have been prepared using expected IFRS that is anticipated to be applicable and adopted for use in the EU, which is not known with certainty at the time of preparing this Interim Financial Information. Therefore, until such time, the possibility that the opening balance sheet and the interim IFRS financial information presented may require amendment cannot be excluded.

IFRS 1 First-time Adoption of International Financial Reporting Standards permits companies adopting IFRS for the first time to take some exemptions from the full requirements of IFRS and also certain elections in the transition period. The exemptions and elections which the Group has taken advantage of are shown in the Group's Annual Report and Accounts for the year ended 2nd October, 2005 and are available on the Group's website www.dmgt.co.uk. Also available in
the IFRS comparative 2005 statements are full details of the Group's new accounting policies.

2. Segmental analysis

Analysis of revenue by business segment

Analysis of revenue by geographic origin

Revenue of regional newspapers and related activities excludes intra-group revenue of £8.8 million (2005 £10.0 million).

Following internal reorganisation to manage all of the Group's national brands together, revenue from National newspapers has been restated to include Television of £25.2 million (2005 £30.2 million), which was previously reported under Broadcasting.

Revenue of business to business information and careers comprises £103.9 million (2005 £78.0 million) from business to business information and £50.5 million (2005 £44.2 million) from careers.

Analysis of profit from operations before restructuring and strategic review costs, amortisation and impairment charges, by business segment

Operating profits of national newspapers have been restated to include a loss from Television of £1.3 million (2005 £0.8 million), which was previously reported under Broadcasting.

Operating profits of business to business information and careers comprised £29.2 million (2005 £19.2 million) from business to business information and a loss of £3.2 million (2005 loss of £3.4 million) from careers, offset by unallocated central costs of £1.9 million (2005 £1.6 million).

Profit from operations is analysed further by segment as follows:

Analysis of profit from operations after restructuring and strategic review costs, amortisation and impairment charges, by business segment

3. Share of results of joint ventures and associates

4. Investment revenue

5. Other gains and losses

The profit on sale of businesses mainly comprises the profit on sale of Aberdeen Journals Limited.

The gain on sale of fixed asset investments in the prior period was on disposal of shares in Reuters Group plc.

6. Finance costs

7. Taxation charge

The tax charge for the period amounted to £30.7 million (2005 £25.1 million).

The adjusted tax on profits before amortisation and impairment of intangible assets, restructuring costs and significant non-recurring or prior year items, amounted to £34.7 million (2005 £29.0 million), and the resulting rate is 31.9% (2005 28.5%).

8. Adjusted earnings per share

Adjusted earnings per share are calculated on profit before amortisation and impairment of intangible assets and restructuring and strategic review costs, after charging the taxation and minority interests associated with those profits, of £70.5 million (2005 £68.9 million), as set out below, and on the weighted average number of ordinary shares in issue during the period. The
weighted average number of shares amounted to 395.4 million (2005 396.6million). As in previous years, adjusted earnings per share have been disclosed since the Directors consider that this alternative measure gives a more comparable indication of the Group's underlying trading performance.

Adjusted profit (before amortisation and impairment of intangible assets and restructuring and strategic review costs)

9. Analysis of net debt

10. Copies of the Interim Report are being posted to shareholders on or around 16th June, 2006 and will be available thereafter from the Secretary, Daily Mail and General Trust plc, Northcliffe House, 2 Derry Street, London, W8 5TT, or electronically from the Company's web site at www.dmgt.co.uk.

Highlights of this announcement will be advertised on 25th May, 2006 in the Evening Standard, on 26th May, 2006 in the Daily Mail, Metro, Western Morning News and the Western Daily Press and on 28th May, 2006 in The Mail on Sunday.

Press Release 25th May, 2006

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