Annual Report & Accounts 2007 - Euromoney Institutional Investor ...

Directors’ Report
The directors submit their annual report and group accounts
for the year ended September 30 2007.
Certain statements made in this document are forwardlooking
statements. Such statements are based on current
expectations and are subject to a number of risks and
uncertainties that could cause actual events or results to differ
materially from any expected future events or results referred
to in these forward-looking statements. Unless otherwise
required by applicable law, regulation or accounting standard,
we do not undertake any obligation to update or revise any
forward-looking statements, whether as a result of new
information, future development or otherwise. Nothing in this
document shall be regarded as a profit forecast.
The directors' report has been prepared for the group as a whole
and therefore gives greater emphasis to those matters which are
significant to Euromoney Institutional Investor PLC and its
subsidiary undertakings when viewed as a whole. It has been
prepared solely to provide additional information to shareholders
as a body to assess the company's strategy and the potential for
that strategy to succeed and the directors' report should not be
relied upon by any other party for any other purpose.
1. Principal activities
Euromoney Institutional Investor PLC is listed on the London
Stock Exchange and is a member of the FTSE 250 share index.
It is a leading international business-to-business media group
focused primarily on the international finance, metals and
commodities sectors. It publishes more than 70 magazines,
newsletters and journals, including Euromoney, Institutional
Investor and Metal Bulletin. It also runs an extensive portfolio
of conferences, seminars and training courses and is a leading
provider of electronic information and data covering the
international finance, metals and commodities, and emerging
markets. Its main offices are located in London, New York,
Montreal and Hong Kong and nearly half its revenues and
profits are derived from the United States. Details of the
group's legal entities can be found in note 13.
2. Strategy
The group's strategy is:
● to grow profits by driving top-line growth from both new
and existing products;
● to build robust subscription and repeat revenues thus
reducing the dependence on advertising;
● to improve operating margins through revenue growth
and tight cost control;
● to leverage technology to launch specialised new
electronic information serves; and
● to make focused acquisitions that supplement the
group's existing businesses, that strengthen the
company’s market position in key areas and that have the
capacity for organic growth using the existing knowledge
base of the group.
In 2004, to supplement this strategy, the board set the group
a profit* target of £50 million by 2008 against a base of
£21 million in 2003. In March 2007, the target was
increased to £57 million to reflect the effect of the Metal
Bulletin acquisition. The profit* achieved for the year was
£65.7 million, beating the increased target a year earlier than
expected. The board believes this significant achievement
reflects the success of the Capital Appreciation Plan (CAP)
incentive scheme indriving growth.
3. Business review
3.1 Group results and dividends
The group profit for the year attributable to shareholders
amounted to £31.8 million (2006: £37.4 million). The directors
recommend a final dividend of 13.0 pence per ordinary
share (2006: 11.6 pence), payable on February 6 2008
to shareholders on the register on November 23 2007. This,
together with the interim dividend of 6.0 pence per ordinary
share (2006: 5.4 pence) which was declared on May 16 2007
and paid on June 25 2007, brings the total dividend for the
year to 19.0 pence per ordinary share (2006: 17.0 pence).
*Profit before tax excluding acquired intangible amortization, share option expense, exceptional items, net movements in acquisition option commitments values,
imputed interest on acquisition option commitments and foreign exchange loss interest charge on tax equalisation swaps as set out in the income statement
and note 7.
06 Euromoney Institutional Investor PLC