Embargoed until September INCISIVE MEDIA PLC INTERIM RESULTS FOR

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Embargoed until September INCISIVE MEDIA PLC INTERIM RESULTS FOR Powered By Docstoc
					Embargoed until 07.00

14 September 2005

INCISIVE MEDIA PLC INTERIM RESULTS FOR THE PERIOD ENDED 30 JUNE 2005 Incisive Media plc announces half year results for the period ended 30 June 2005. Incisive Media is a fast growing specialist business information provider, delivering key information to defined target audiences across a variety of platforms in print, in person and online, including magazines, newsletters and books, conferences, exhibitions and training, websites and databases. Incisive Media is focused on high value, growth markets, and providing targeted and integrated marketing solutions where we bring the buyer with the seller together. Incisive Media’s market leading brands include Risk, Investment Week, Post Magazine, Your Mortgage, Unquote and Search Engine Strategies. FINANCIAL AND OPERATING HIGHLIGHTS Unaudited 6 months to 30/06/05 £’000 24,025 Unaudited 6 months to 30/06/04 £’000 21,369

Change % +12%

Revenue PROFIT AS REPORTED ON A STATUTORY BASIS Operating profit
Operating margin

5,019
21%

4,923
23%

+2%

Profit before tax Profit for the financial period Basic earnings per share Diluted earnings per share PROFIT AS REPORTED ON AN ADJUSTED* BASIS (see note 3) Adjusted operating profit
Adjusted operating margin

3,899 2,755 3.00 2.95

3,797 2,822 3.28 3.21

+3% -2% -9% -8%

5,498
23%

5,194
24%

+6%

Adjusted profit before tax Adjusted profit for the financial period Adjusted basic earnings per share Adjusted diluted earnings per share Interim dividend

4,378 3,234 3.52 3.46 0.90

4,068 3,093 3.60 3.52 0.75p

+8% +5% -2% -2% +20%

• • • • •

Revenues up 12% Profit before tax up by 3% and adjusted profit before tax up 8% 20% increase in the interim dividend 138% cash conversion rate of adjusted operating profits Recently announced acquisitions of Search Engine Strategies

Adjusted* = before amortisation of intangible assets arising on acquisitions, charges for share based payments and charges for holiday pay accrued but not taken

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Tim Weller, Chief Executive of Incisive Media plc, commented: “We made good progress in the first half-year in developing and extending our high-margin portfolio of professional information business, despite uneven conditions from month to month in some of our chosen markets. “After a positive start to the year with underlying revenue growth in all the divisions of the business, performance in April and May was more mixed, with continued growth in our Financial Services division but tougher trading in the Risk Management and Insurance Services divisions. Trading in June was back on track for the Group as a whole. We have invest ed for organic growth, both in the existing portfolio and by launching new products, and we expect to see some of the benefits of these efforts to start coming through during the second half. We continue to pursue opportunities to grow the business through acquisition, and we were delighted to be able to announce recently the purchase of the market leading tradeshow and content provider, Search Engine Strategies. “The principal markets we address remain strong, with positive long term outlooks. As the communities we serve become increasingly sophisticated, and demand more specific, targeted, marketing solutions, we believe that we are in a strong position to capitalise on this trend given our focus on customer partnering, our reputation for innovation and our wide and deep mix of products. Traditionally for us, the second half of our year is stronger than the first half, and we remain confident of prospects for the full year.” END For further information, please contact: Tim Weller Chief Executive Incisive Media plc www.incisivemedia.com Group Finance Director Incisive Media plc www.incisivemedia.com Peregrine Communications +44 (0) 20 7484 9700 Tim.Weller@incisivemedia.com +44 (0) 20 7484 9700 Jamie.Campbell-Harris@incisivemedia.com +44 (0) 20 7484 9983 +44 (0) 7930 643 983 Anthony.Payne@peregrinecommunications.co.uk

Jamie Campbell-Harris

Anthony Payne

Notes: • • There will be an analyst briefing at 9.30 am on Wednesday 14 September, 2005 at the offices of Investec, 2 Gresham Street, London EC2V 7QP. Photographs of Tim Weller and Jamie Campbell-Harris are available at www.incisivemedia.com

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INCISIVE MEDIA PLC INTERIM RESULTS FOR THE PERIOD ENDED 30 JUNE 2005 Overview for the period We made good progress in the first half-year in developing and extending our high-margin portfolio of professional information business, despite uneven conditions from month to month in some of our chosen markets. First half reported revenues were up 12% at £24.03m (2004: £21.37m) while underlying revenues, which exclude the effect of acquisitions, grew by 5%. After a positive start to the year with revenue growth in all the divisions, performance in April and May was more mixed. While we saw continued growth in our Financial Services division, trading was tougher in the Risk Management and Insurance Services divisions, with weaker sponsorship and advertising revenues. Trading for June was back on track for the Group as a whole. We have invested for organic growth, both in the existing portfolio and by launching new products, and we expect to see some of the benefits to start coming through during the second half. We continue to pursue further acquisitions, and we were delighted to be able to announce recently the purchase of the market leading tradeshow and content provider, Search Engine Strategies (“SES”). This acquisition takes us into a new, important and growing market niche, internet search. Profit before tax grew by 3% to £3.90m (2004: £3.80m) but diluted earnings per share fell by 8% to 2.95p (2004: 3.21p). To assist understanding of the underlying operating performance of the Group, we are also reporting adjusted profit and earnings per share numbers excluding the effects of amortisation of certain intangible assets, the value of share based payments, and holiday accrued but not yet taken. On this basis, adjusted profit before t ax was up 8% at £4.38m (2004: £4.07m), and adjusted diluted earnings per share were down 2% at 3.46p (2004: 3.52p), compared to the same period last year. On the same adjusted basis operating margins were 23% (2004: 24%). Margins fell due to continuing strong product investment over a mixed period for revenue. During the period we continued to launch new products, which included a number of new events, such as DWT USA, the Spanish Investment Forum and the Equity Release Roadshow . A new magazine, Life and Pensions, was conceived and researched during the period, before being launched in July, and two titles, Real Adviser and Global Credit were launched to replace existing products in the portfolio. We also rolled out our successful web based conferencing model, Conjecture, into several other areas of the business. In addition we have invested in our Asia operations and expect to produce a number of new events in the second half. We continue to look for new acquisition opportunities, and in January we acquired the “SWAY Senate” event which runs in June each year serving the retail investment market. This event complements our other events in the Financial Services division. In August we completed the acquisition of Search Engine Strategies, a series of conferences and exhibitions, supported by two market leading websites, which deliver key information and education to interactive marketers and other professionals involved in the search engine industry. This is a growing arena for marketing and is a very exciting opportunity in this new fast growing, global, vertical market. We have had a strong focus on improving the speed of debt collection which contributed to the excellent cash conversion rate of 138% of underlying operating profit to cash. This was also helped by the growth in subscriptions during the period. Net debt at 30 June 2005 was £28.9m compared to £35.0m at the 30 June 2004 and £32.8m at 31 December 2004. Interest cover, based on adjusted operating profit, was a comfortable 4.9 times. The Board has declared an interim dividend of 0.90 pence per share (2004: 0.75 pence). The interim dividend will be paid on 1 November 2005 to shareholders on the share register as at 30 September 2005.

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Divisional analysis for the period As the Group continues to grow we have re -organised the business into four divisions: Financial Services, Risk Management, Insurance Services and Marketing/Other. This better reflects the way in which the Group is managed, as well as the communities the titles serve. Financial Services division This division now incorporates the former Investment, Mortgage and Private Equity businesses. The division performed strongly during the first half with revenue growth of 31% to £11.31 million. The Investment business performed strongly with 14% underlying revenue growth, driven by events, both on Investment Week, the division’s flagship title, and International Investment , which increased by 31% and 18% respectively. In January, the Group also acquired the “Sway Senate” event which ran in Monte Carlo in June and boosted overall revenue growth to 22%. The Private Equity business performed in line with expectations, and successfully launched its first conference in January. We are beginning to see the benefits of the invest ment we have made so far. The Mortgage business benefited from an excellent performance from Mortgage Solutions which helped revenues grow by 20% during the period. Risk Management division During the first half, the Risk Management division delivered revenues of £7.34m (2004: £7.43m). Overall publication revenues for the division grew by 7% during the period, with good performances from a number of brands and strong growth on subscriptions. We also benefited from the launch, last year, of Structured Products. Conversely, advertising in the flagship brand, Risk Magazine, was disappointing during April and May, and this resulted in a 12% fall for the half year period. The two major Operational Risk events performed ve ry well, as did our new training events and other new initiatives, particularly in Asia. However, the performances of the two flagship Risk events (USA and Europe) were disappointing, due to reduced delegate numbers and sponsorship revenue which combined to impact profitability. Overall event revenues were down by 15% for the division in the first half, which was exacerbated by the timing impact of two medium sized events which ran in the first half in 2004, but are now scheduled for the second half of this year. Insurance Services division During the first half, the Insurance Services division delivered revenues of £3.22m (2004: £3.29m). The division benefited from an uplift in subscriptions with 10% growth year on year and a very positive performance on events which grew 30% across the division. Overall performance was, however, adversely affected in the second quarter by a shortfall on recruitment and display advertising on our flagship title, Post Magazine, leaving revenues for the division 2% down overall. Marketing / Other division Marketing and other services, represents a new division which will comprise the newly acquired SES as well the existing Market Data, IT and Photographic businesses. Revenue for the division for the first half was £2.16m (2004: £2.04m) Waters, our US based financial IT brand, performed very strongly after two difficult years, but the IT business was adversely affected by a disappointing performance from the DWT event. Our photography title, BJP, continued to perform satisfactorily.

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Outlook The principal markets we address remain strong, with positive long term outlooks, and as the communities we serve become increasingly sophisticated, and demand more specific, targeted, marketing solutions, we believe that we are in a strong position to capitalise on this trend given our focus on customer partnering, our reputation for innovation and our wide and deep mix of products. Traditionally for us, the second half of our year is stronger than the first half, and we remain confident of prospects for the full year.

Tim Weller Chief Executive

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INCISIVE MEDIA PLC Unaudited interim results for the six months to 30 June 2005 Consolidated income statement Unaudited 6 months to 30/06/05 £'000 24,025 (14,424) 9,601 (4,393) (189) (4,582) 2 5,019 107 (1,227) 3,899 5 3 (1,144) 2,755 (2) 2,757 2,755 pence Earnings per share - basic Earnings per share - diluted 4 4 3.00 2.95 Unaudited 6 months to 30/06/04 £'000 21,369 (12,189) 9,180 (4,245) (12) (4,257) 4,923 50 (1,176) 3,797 (975) 2,822 2,822 2,822 pence 3.28 3.21 Unaudited 12 months to 31/12/04 £'000 46,492 (27,081) 19,411 (7,514) (25) (7,539) 11,872 130 (2,485) 9,517 (2,810) 6,707 (6) 6,713 6,707 pence 7.57 7.41

Continuing operations Revenue Cost of sales Gross profit - administrative expenses before amortisation - amortisation of intangible assets Administrative expenses Operating profit Finance income Finance costs Profit before taxation Taxation Profit for the period Attributable to: Minority interest Equity shareholders

Note 2

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INCISIVE MEDIA PLC Unaudited interim results for the six months to 30 June 2005 Consolidated statement of recognised income and expense

Unaudited 6 months to 30/06/05 £'000 Exchange differences on translation of foreign operations Deferred tax on share based payments Net gains not recognised in income statement Profit for the financial period Total recognised income and expense for the period 47 47 2,755 2,802

Unaudited 6 months to 30/06/04 £'000 4 42 46 2,822 2,868

Unaudited 12 months to 31/12/04 £'000 12 84 96 6,707 6,803

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INCISIVE MEDIA PLC Unaudited interim results for the six months to 30 June 2005 Consolidated balance sheet Unaudited 30/06/05 £'000 Unaudited 30/06/04 £'000 Unaudited 31/12/04 £'000

Note Assets Non-current assets Intangible assets Property, plant and equipment Current assets Financial assets Inventories Trade and other receivables Cash and cash equivalents Liabilities Current liabilities Financial liabilities Trade and other payables Current tax liabilities Net current liabilities Non-current liabilities Financial liabilities Deferred tax liabilities

96,820 911 97,731 46 382 9,619 5,046 15,093 (8,373) (14,469) (2,324) (25,166) (10,073) (25,569) (4,940) (30,509) 57,149 923 36,201 8,582 11,451 57,157 (8) 8 57,149

93,490 750 94,240 430 11,337 2,598 14,365 (8,036) (14,435) (1,062) (23,533) (9,168) (27,972) (4,899) (32,871) 52,201 913 35,893 8,953 6,442 52,201 52,201

96,339 797 97,136 467 10,235 5,334 16,036 (7,385) (16,706) (1,972) (26,063) (10,027) (26,500) (5,082) (31,582) 55,527 914 35,903 8,953 9,763 55,533 (6) 55,527

Net assets Shareholders’ equity Ordinary shares Share premium Other reserves Retained earnings Total shareholders’ equity Minority interest in equity Total equity

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INCISIVE MEDIA PLC Unaudited interim results for the six months to 30 June 2005 Consolidated cash flow statement Unaudited 6 months to 30/06/05 £'000 7,563 107 (1,156) (799) 5,715 (450) (2,000) (284) (141) (2,875) 307 2,500 (1,849) (2,944) (1,142) (3,128) (288) 5,334 5,046 Unaudited 6 months to 30/06/04 £'000 4,690 30 (1,132) (1,052) 2,536 (16,873) (210) 8 (17,075) 10,976 9,100 (1,458) (2,119) (166) (829) 15,504 965 1,633 2,598 Unaudited 12 months to 31/12/04 £'000 11,932 124 (2,435) (1,843) 7,778 (16,851) (430) 8 (17,273) 10,987 9,100 (3,057) (2,124) (196) (1,514) 13,196 3,701 1,633 5,334

Note Cash flows from operating activities Cash generated from operations Interest received Interest paid Tax paid Net cash from operating activities Cash flows from investing activities Acquisition of subsidiaries (net of cash acquired) Acquisition of other investments Payment of deferred consideration Purchase of plant and equipment Payments to purchase intangible assets Proceeds from sale of plant and equipment Net cash flows from investing activities Cash flows from financing activities Net proceeds from the issue of ordinary share capital Net proceeds from the issue of new bank loans Repayment of bank loans Repayment of loan notes Issue costs of new loans Dividends paid to shareholders Net cash used in financing activities Net (decrease)/increase in cash and cash equivalents Cash and cash equivalents at the beginning of the period Cash and cash equivalents at the end of the period

7

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INCISIVE MEDIA PLC Unaudited interim results for the six months to 30 June 2005 Notes to the interim statements 1. Basis of preparation

These June 2005 interim consolidated financial statements of Incisive Media plc are for the six months ended 30 June 2005. They are covered by IFRS 1, First-time Adoption of IFRS, because they are part of the period covered by the Group’s first IFRS financial statements for the year ended 31 December 2005. These financial statements have been prepared on the basis of the accounting policies expected to apply for the financial year to 31 December 2005 applicable to companies under IFRS. The IFRS standards and IFRIC interpretations that will be applicable at 31 December 2005, including those that will be applicable on an optional basis, are not known with certainty at the time of preparing these interim financial statements. Thus the accounting policies adopted in these interim financial statements may be subject to revision to reflect further IFRS standards, IFRIC interpretations and pronouncements issued between 14 September 2005 and publication of the first full set of IFRS financial statements for the year ending 31 December 2005. As this is the first year when the consolidated financial statements will be prepared under International Financial Reporting Standards (IFRS), the comparatives for 2004 have been restated from UK Generally Accepted Accounting Practice (GAAP) to comply with IFRS. The restated financial statements for 2004, which include reconciliations and descriptions of the effect of the transition from UK GAAP to IFRS on the Group’s equity and its net income and cash flows as at 1 January 2004 and the 2004 full year accounts, are available on www.incisivemedia.com. The accounting policies of the group under IFRS can be found on www.incisivemedia.com. The accounting policies have been consistently applied to all the years presented except for those relating to the classification and measurement of financial instruments. IAS 39 ‘Financial Instruments: Recognition and Measurement’ and IAS 32 ‘Financial Instruments: Disclosure and Presentation’ have not been applied to the 6 months ended 30 June 2004 or the 12 months ended 31 December 2004. The Group has made use of the exemption available under IFRS 1 to only apply IAS 32 and IAS 39 from 1 January 2005 as explained further in Note 10. The policies applied to financial instruments for 2004 can be found on the Group’s website above, with the accounting policy for 2005 disclosed separately below. The financial statements have been prepared under the historical cost convention as modified by the revaluation of availablefor-sale financial assets, and financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss. The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges are recognised in equity. The preparation of financial statements in conformity with generally accepted accounting principles requires the use of certain critical accounting estimates. It also requires management to exercise judgement in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated interim financial statements are disclosed within the Group’s accounting policies.

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INCISIVE MEDIA PLC Unaudited interim results for the six months to 30 June 2005 Notes to the interim statements 2. Segmental review

Segment information is presented in respect of the Group’s business segments. The primary format, business segments is based on the Group’s management and internal reporting structure. The Group comprises the following main business segments: Financial Services, Risk Management, Insurance Services and Marketing and Other Services. Segment results include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly of corporate and head office expenses.

Unaudited 6 months to 30/06/05 £'000 Revenue Financial Services Risk Management Insurance Services Marketing and Other 11,308 7,344 3,215 2,158 24,025

Unaudited 6 months to 30/06/04 £'000 8,622 7,425 3,285 2,037 21,369

Unaudited 12 months to 31/12/04 £'000 19,923 14,493 8,180 3,896 46,492

Unaudited 6 months to 30/06/05 £'000 Operating profit Financial Services Risk Management Insurance Services Marketing and Other Central departments 3,308 2,237 794 206 (1,526) 5,019

Unaudited 6 months to 30/06/04 £'000 3,035 2,461 817 305 (1,695) 4,923

Unaudited 12 months to 31/12/04 £'000 6,926 4,623 2,525 326 (2,528) 11,872

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INCISIVE MEDIA PLC Unaudited interim results for the six months to 30 June 2005 Notes to the interim statements 3. Profit for the period Unaudited 6 months to 30/06/05 £'000 Profit for the period is stated after charging: Amortisation of intangible assets - contracted business at date of acquisition - software - other intangible assets Depreciation Holiday pay accrued but not taken Fair value of share based payments Unaudited 6 months to 30/06/04 £'000 Unaudited 12 months to 31/12/04 £'000

177 11 1 159 277 25

9 3 163 205 66

19 6 341 131

In order to assist the understanding of the underlying performance of the business, the following adjustments have been made to arrive at an adjusted profit before taxation and are referred to in the Chief Executive’s report and financial highlights.

Unaudited 6 months to 30/06/05 £'000 Operating profit Amortisation of contracted business at date of acquisition Holiday pay accrued but not taken Fair value of share based payments Adjusted operating profit Finance income Finance costs Adjusted profit before taxation Taxation Adjusted profit for the period Attributable to: Equity shareholders Minority interest 5,019 177 277 25 5,498 107 (1,227) 4,378 (1,144) 3,234 3,236 (2) 3,234

Unaudited 6 months to 30/06/04 £'000 4,923 205 66 5,194 50 (1,176) 4,068 (975) 3,093 3,093 3,093

Unaudited 12 months to 31/12/04 £'000 11,872 131 12,003 130 (2,485) 9,648 (2,810) 6,838 6,844 (6) 6,838

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INCISIVE MEDIA PLC Unaudited interim results for the six months to 30 June 2005 Notes to the interim statements 4. Earnings per share Unaudited 6 months 30/06/05 £'000 Earnings attributable to equity shareholders 2,757 number Weighted average number of shares in issue in period – basic Effect of dilutive securities - options to staff Weighted average number of shares in issue in period – diluted 91,879,641 1,676,197 93,555,838 pence Earnings per share – basic Earnings per share – diluted Adjusted earnings per share Adjusted earnings attributable to equity shareholders 3.00 2.95 £'000 3,236 pence Adjusted earnings per share – basic Adjusted earnings per share – diluted 3.52 3.46 Unaudited 6 months to 30/06/04 £'000 2,822 number 85,914,281 1,971,698 87,885,979 pence 3.28 3.21 £'000 3,093 pence 3.60 3.52 Unaudited 12 months to 31/12/04 £'000 6,713 number 88,659,460 1,889,186 90,548,646 pence 7.57 7.41 £'000 6,844 pence 7.72 7.56

5.

Taxation

The tax charge for the six months to 30 June 2005 is based on the profit before tax for that period, and results in an effective tax rate of 29.3% (2004: 25.7%). 6. Dividends

The Company will pay an interim dividend of 0.90 pence per share (2004: 0.75 pence). The interim dividend will be paid on 1 November 2005 to shareholders on the share register at 30 September 2005. The shares will go ex-dividend on 28 September 2005.

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INCISIVE MEDIA PLC Unaudited interim results for the six months to 30 June 2005 Notes to the interim statements 7. Reconciliation of profit for the period to cash generated from operations Unaudited 6 months to 30/06/05 £'000 Profit for the period Adjusted for: Tax Depreciation Profit on disposal of plant and equipment Amortisation of intangible assets Fair value of share based payments Interest income Interest expense Changes in working capital (excluding effects of acquisitions) Decrease/(increase) in inventories Decrease/(increase) in trade and other receivables Increase/(decrease) in payables Cash generated from operations 2,755 1,144 159 189 25 (107) 1,227 85 274 1,812 7,563 Unaudited 6 months to 30/06/04 £'000 2,822 975 163 (3) 12 66 (50) 1,176 (124) (353) 6 4,690 Unaudited 12 months to 31/12/04 £'000 6,707 2,810 341 (3) 25 131 (130) 2,485 (162) 556 (828) 11,932

8.

Statement of changes in shareholders’ equity Unaudited 30/06/05 £'000 Unaudited 30/06/04 £'000 2,822 4 (829) 10,976 66 42 13,081 39,120 52,201 52,201 Unaudited 31/12/04 £'000 6,713 12 (1,514) 10,987 131 84 16,413 39,120 55,533 (6) 55,527

Profit attributable to equity shareholders Exchange differences on translation of foreign operations Dividends Shares issued Fair value of share based payments Deferred tax on share based payments Fair value loss on financial instruments Net movement for the period Total equity at the beginning of the period Transitional adjustment on adoption of IAS 39

2,757 (1,142) 307 25 47 (524) 1,470 55,527 154 57,151

Minority interests Total equity at the end of the period

(2) 57,149

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INCISIVE MEDIA PLC Unaudited interim results for the six months to 30 June 2005 Notes to the interim statements 9. Events after the balance sheet date

On 5 August 2005, the Group completed the acquisition of Search Engine Strategies, a series of conferences and exhibitions, supported by two market leading websites, SearchEngineWatch.com and ClickZ.com, which together serve the growing search engine and inter-active marketing sector. The acquisition of these US assets for cash of $43.0m from JupiterMedia, Inc. was funded by a mix of debt and the issue of 8.2m new shares to institutional investors. 10. Transition to IFRS Reconciliations, including explanations from UK GAAP to IFRS of the balance sheet as at 1 January 2004 (the date of transition to IFRS), 30 June 2004 and 31 December 2004 (the date of the last UK GAAP financial statements) together with the reconciliations of the consolidated income statement and the consolidated cash flow statement for the year to 31 December 2004 and the six months to 30 June 2004 have been published on the Company’s website at www.incisivemedia.com. IAS 39 ‘Financial Instruments: Recognition and Measurement’ and IAS 32 ‘Financial Instruments: Disclosure and Presentation’ have not been applied for the periods to 30 June 2004 and 31 December 2004 because the Group has taken a transitional exemption and adopted those standards prospectively from 1 January 2005. The accounting policy in respect of financial instruments, as applied from 1 January 2005, is as follows: Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured at their fair value. The method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. The Group has designated certain derivatives as cash flow hedges. The Group documents at the inception of the transaction the relationship between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions. The Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flows of hedged items. The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges are recognised in equity. The gain or loss relating to the ineffective portion is recognised immediately in the income statement. The effect of the transitional adjustment on the balance sheet as at 1 January 2005 is as follows: 01/01/05 £’000 409 (26,480) (26,071) Transition adjustment £’000 409 (255) 154 31/12/04 £’000 (26,225) (26,225)

Current assets Financial assets Non-current liabilities Financial liabilities Reserves

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Independent review report to Incisive Media plc Introduction We have been instructed by the company to review the financial information for the six months ended 30 June 2005 which comprises the consolidated interim balance sheet as at 30 June 2005 and the related consolidated interim statements of income, cash flows and changes in shareholders' equity for the six months then ended. We have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the financial information. Directors' responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by the directors. The directors are responsible for preparing the interim report in accordance with the Listing Rules of the Financial Services Authority. As disclosed in note 1, the next annual financial statements of the company will be prepared in accordance with accounting standards adopted for use in the European Union. This interim report has been prepared in accordance with the basis set out in Note 1. The accounting policies are consistent with those that the directors intend to use in the next annual financial statements. As explained in note 1, there is, however, a possibility that the directors may determine that some changes are necessary when preparing the full annual financial statements for the first time in accordance with accounting standards adopted for use in the European Union. The IFRS standards and IFRIC interpretations that will be applicable and adopted for use in the European Union at 31 December 2005 are not known with certainty at the time of preparing this interim financial information. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4 issued by the Auditing Practices Board for use in the United Kingdom. A review consists principally of making enquiries of management and applying analytical procedures to the financial information and underlying financial data and, based thereon, assessing whether the disclosed accounting policies have been applied. A review excludes audit procedures such as tests of controls and verification of assets, liabilities and transactions. It is substantially less in scope than an audit and therefore provides a lower level of assurance. Accordingly we do not express an audit opinion on the financial information. This report, including the conclusion, has been prepared for and only for the company for the purpose of the Listing Rules of the Financial Services Authority and for no other purpose. We do not, in producing this report, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the six months ended 30 June 2005. PricewaterhouseCoopers LLP Chartered Accountants Milton Keynes 14 September 2005

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