Underlying revenue was up 4.2 per cent – after adjusting for the effects of acquisitions, foreign exchange, SARS and biennials. Group revenue in the first half of 2004 was increased by £39.0m of acquisition revenue. The weakness of the US dollar has a direct translation impact upon consolidation – with two thirds of UBM revenue reported locally in US dollars, consolidated turnover was reduced by £27.8m as a result of foreign exchange.

The average rate of $:£ exchange in H1 2004 was 1.82 (H1 2003: 1.61), reducing operating profit in H1 2004 by £5m. A 1 cent movement in the US dollar against sterling is approximately equivalent to a move in profit of around £400,000 over the full year.

DIVISIONAL REVIEW
Professional Media

Turnover
Six months to
30 June

Profitability at CMP Media has improved significantly. An underlying 2 per cent growth in revenue and more than a doubling in operating margins has resulted in operating profits increasing to £11.9m (£4.9m). Underlying technology revenues (over 80 per cent of CMP Media revenues) were up 2 per cent, all media channels achieved positive revenue growth with on line revenues particularly strong with over 30 per cent growth. Five out of the six industry sub-sectors achieved positive growth. Technology publishing yields were up by 3.4 per cent.

Last year’s healthcare acquisition (The Oncology Group and Cliggott Publishing) is fully integrated and delivered a good performance. Total healthcare revenues were up over 70 per cent. Underlying revenues were down 3 per cent as publishing again achieved strong growth but revenue from the medical education business (which represents under a quarter of CMP Media’s healthcare business) was reduced as the healthcare companies adapt to new industry regulations.

Further operating efficiencies were achieved across CMP Media. In addition, organic investment projects delivered £5.3m of revenue and £1.7m of operating profit.

CMP Asia has continued its strong recovery from the negative effects of SARS. Profits of £6.3m reflected improved strength in the established business and growth from products launched in recent years. This active launch programme has continued into 2004.

CMP Information has delivered another robust performance. The 2003 acquisitions (including The Builder Group and Barbour Index) are performing well, with significant cost synergies having been achieved. The success of the acquisitions helped drive CMPi’s margins up again – to 20.3 per cent (18.2 per cent). CMPi’s continuing businesses also grew – with underlying revenue up 5.0 per cent. Continuing businesses increased exhibition space, grew yields and – boosted by new product launches – gained market share.

UAP’s overall revenue performance was in line with H1’03, with a strong performance from Daltons Weekly and DaltonsBusiness.com, revenue declines from the Exchange & Mart publication and a strong performance from the Auto Exchange titles. Margins were down due to the costs of restructuring, new product investment and promotions.

UBM’s acquisition of MediMedia’s drug information businesses in continental Europe and Asia is expected to complete on 30 July 2004.

PR Newswire – News Distribution

Turnover
Six months to
30 June

PR Newswire delivered a strong performance with an 88.6 per cent increase in underlying operating profit coming from an operating margin of 24.3 per cent (16.7 per cent) and an underlying 10.9 per cent increase in revenue.

There were three main factors behind PR Newswire’s recent achievements: improvements in core US wire revenues, the increased success of organic product launches and significant improvements in the profitability of operations outside of the Americas.

US wire volumes increased by 5.4 per cent with yields up 5.5 per cent. The two largest US organic products – video news release and contacts database products, both grew revenue by over a third. Operations outside the Americas lost £2.7m in the second half of 2003 – improvements in operating efficiencies contributed to an H1’04 Rest of the World operating loss of only £0.3m.

NOP World – Market Research

Turnover
Six months to
30 June

Overall NOP World delivered an underlying 4.5 per cent growth in revenue, in line with the market research industry. The syndicated and continuous businesses have again grown strongly – with Mediamark Research and Allison-Fisher both delivering significant increases in revenue. Generally the ad hoc and custom businesses are making progress. The healthcare businesses achieved revenue growth in the first half, however going into the second half of the year the environment in this sector is challenging and competitive. The recently acquired Italian business Eurisko is performing well.

DIVIDEND
An interim dividend of 3.63 pence (3.30 pence) per share for 2004 will be paid. This represents a 10.0 per cent increase and is consistent with the 10.0 per cent increase at the interim results stage in 2003. A decision on the dividend for the full year will be taken in line with our progressive dividend policy.

The interim dividend will be paid on 21 October to shareholders on the register on 13 August. The ex-dividend date will be 11 August.

BALANCE SHEET AND CASH CONVERSION
Net cash balances at the end of the period were £51.6m, up £5.1m on the year end. Operating cash conversion was 67.1 per cent of operating profit – lower than H1 2003 due to the higher working capital requirements associated with higher levels of revenue and increased seasonality following the acquisitions in 2003. Our target in the current year is to achieve cash conversion of 90 to 100 per cent over the full year.

FIXED ASSET INVESTMENTS
UBM holds investments in five, ITN, SIS, SDN, Paperloop and the Press Association. Five revenue grew by 11 per cent to £133.6m (£121.8m) and achieved a significantly increased operating profit of £6.2m (£0.7m). Its audience share increased to 6.9 per cent (6.6 per cent) and its share of advertising revenue increased from 7.8 per cent to 8.0 per cent.

Income from investments of £3.0m includes dividends received from the Press Association and ITN.

TAX
The effective tax rate in H1 2004 was 21.8 per cent (21.9 per cent).