word
sp
WELL
GOOD
MORNING
LADIES
AND
GENTLEMEN
sp
BEFORE
sp
WE
sp
START
THE
PRESENTATION
I'D
MENTION
THERE
WILL
BE
HARD
COPIES
OF
THE
SLIDES
AVAILABLE
THE
VIDEO
IS
FOR
INTERNAL
USE
ONLY
sp
AND
sp
THERE
SHOULD
BE
PLENTY
OF
TIME
FOR
QUESTIONS
AT
THE
END
SIX
sp
MONTHS
AGO
WE
REPORTED
INTERIM
RESULTS
{XX}
FIFTY
EIGHT
PERCENT
DOWN
ON
THE
PREVIOUS
sp
YEAR
BUT
HELD
OUT
HOPE
sp
FOR
A
STRONGER
PERFORMANCE
IN
THE
SECOND
HALF
IN
THE
EVENT
OUR
OS
OPTIMISM
WAS
JUSTIFIED
AND
IN
THE
SECOND
HALF
WHEN
WE
ALWAYS
sp
MAKE
sp
THE
BULK
OF
OUR
PROFITS
WE
FOUGHT
BACK
AND
OUR
SECOND
PRE
TAX
ER
ER
PERFORMANCE
EXCEEDED
BY
SOME
FIVE
MILLION
ER
sp
THAT
OF
sp
NINETEEN
NINETY
THIS
WASN'T
SUFFICIENT
TO
MAKE
UP
THE
GROUND
LOST
IN
THE
FIRST
sp
HALF
AND
THE
OUTCOME
FOR
THE
YEAR
AS
A
WHOLE
YOU
NOW
SEE
I'D
LIKE
TO
DRAW
YOUR
sp
ATTENTION
TO
sp
A
sp
COUPLE
OF
POINTS
sp
ON
THIS
SLIDE
FIRST
THE
HIGH
EARNINGS
PER
SHARE
sp
AFTER
EXTRAORDINARY
ITEMS
WHICH
IS
INCREASINGLY
RELEVANT
TO
THE
PROPOSED
sp
NEW
ACCOUNTING
STANDARDS
AND
SECONDLY
{XX}
THAT
sp
WE'RE
RECOMMENDING
A
MAINTAINED
DIVIDEND
WHICH
WE
sp
CAN
PRUDENTLY
DO
BEARING
IN
MIND
{XX}
OUR
REASONABLE
DIVIDEND
COVER
AND
LOW
NET
DEBT
WE
NOW
COME
TO
THE
BREAKDOWN
OF
TRADING
PROFIT
BY
SECTOR
PROFITS
ER
sp
FROM
OIL
SERVICES
sp
WERE
WELL
AND
EDUCATIONAL
PUBLISHING
IN
THE
U
S
sp
ER
PUT
IN
A
VERY
STRONG
PERFORMANCE
FRANK
{GAP_ANONYMIZATION_NAME}
WILL
BE
GOING
INTO
MORE
DETAIL
ON
THESE
AND
OUR
OTHER
BUSINESSES
WHICH
ARE
ALL
FACING
AN
UPHILL
STRUGGLE
PARTICULARLY
IN
THE
U
K
sp
AND
NORTH
AMERICA
BOTH
IN
DEEP
RECESSION
AND
WHICH
YOU
CAN
sp
SEE
CONTINUE
TO
MAKE
UP
sp
THE
BULK
OF
OUR
MARKETS
I'D
ADD
THAT
AT
THE
MOMENT
WE
DO
NOT
SEE
ANY
UPTURN
IN
ANY
OF
sp
OUR
MAJOR
MARKETS
BEFORE
HANDING
OVER
TO
FRANK
I'D
LIKE
TO
EMPHASISE
SOME
OF
THE
sp
KEY
sp
POINTS
OF
NINETEEN
NINETY
ONE
YES
WE
DID
HAVE
A
STRONG
PROFITS
RECOVERY
IN
THE
SECOND
HALF
GREATLY
HELPED
BY
OIL
sp
SERVICES
AND
U
S
EDUCATIONAL
sp
PUBLISHING
sp
WE
HAD
A
STRONG
IMPROVEMENT
IN
sp
OPERATING
sp
CASH
GENERATION
AND
THAT
AND
sp
THE
SALE
OF
{OOV}
BROUGHT
NET
DEBT
sp
DOWN
sp
TO
A
LOW
sp
LEVEL
B
sp
SKY
B
IS
NOW
PROFITABLE
OF
TRADING
LEVEL
WE
INCREASED
OUR
STAKE
IN
IT
sp
DURING
THE
sp
YEAR
FROM
ELEVEN
PERCENT
sp
TO
SIXTEEN
PERCENT
FRANK
{GAP_ANONYMIZATION_NAME}
sp
BECAME
THE
NEW
CHAIRMAN
AND
sp
WE
BELIEVE
THAT
IN
DUE
sp
COURSE
IT'S
GON
NA
GENERATE
SUBSTANTIAL
PROFITS
FINALLY
I'D
LIKE
TO
MENTION
THAT
WE
SHALL
BE
RECOMMENDING
sp
FOR
SHAREHOLDERS
A
ONE
FOR
ONE
sp
SCRIP
ISSUE
THIS
ISN'T
INTENDED
sp
AS
sp
ANY
PARTICULAR
MESSAGE
BUT
WE
ARE
NOW
sp
ONE
OF
THE
WEIGHTIEST
SHARES
IN
THE
F
sp
T
S
E
INDEX
AND
BE
WE
BELIEVE
THAT
IT
SHOULD
IMPROVE
THE
MARKET
LIQUIDITY
OF
THE
SHARES
NOW
sp
FRANK
GOOD
MORNING
EVERYONE
I
THINK
WHEN
WE
TALKED
TO
YOU
ER
WHEN
WE
PRESENTED
THE
sp
INTERIMS
sp
ER
WE
TALKED
ABOUT
THE
ACTION
WE
WOULD
BE
TAKING
GIVEN
THE
sp
DIFFICULT
CIRCUMSTANCES
sp
AND
ER
IF
sp
I
COULD
JUST
sp
REMIND
YOU
WE
SAID
WE'D
BE
GOING
FOR
COST
SPACE
REDUCTIONS
sp
WELL
WE'VE
DONE
THAT
AS
WE
SAID
WE
WOULD
AND
OF
COURSE
IN
A
BUSINESS
SUCH
AS
PEARSON
WHICH
IS
sp
A
PEOPLE
BUSINESS
ER
ALTHOUGH
WE
sp
REGULARLY
MONITOR
EMPLOYMENT
STATISTICS
SUCH
AS
TOTAL
EMPLOY
TOTAL
NUMBER
sp
OF
EMPLOYEES
ER
REVENUE
sp
PER
EMPLOYEE
COST
PER
EMPLOYEE
PROFIT
sp
PER
EMPLOYEE
sp
THERE
ARE
TIMES
sp
WHEN
WE
HAVE
TO
TAKE
ER
DIFFICULT
DECISIONS
AND
ER
SO
WE'VE
sp
GONE
sp
IN
FOR
A
LOT
OF
REDUNDANCY
WHICH
WE'LL
SEE
IN
IN
ER
DURING
sp
THE
NEXT
SLIDE
OR
TWO
sp
BUT
NOT
JUST
REDUNDANCY
WE'VE
TAKEN
INITIATIVES
IN
LOTS
OF
OTHER
AREAS
sp
WE'LL
SHOW
YOU
THOSE
AS
WELL
ON
CAPITAL
SPENDING
WE
TENDED
TO
CONCENTRATE
sp
ON
THAT
sp
SPENDING
WHICH
WOULD
SHOW
A
RETURN
ON
THE
INVESTMENT
AND
IF
WE
COULD
WE'VE
POSTPONED
ER
MAINTENANCE
SPENDING
sp
ERM
RENEWAL
OF
CARS
AND
THAT
KIND
OF
THING
ALL
sp
OF
OUR
CHIEF
EXECUTIVES
sp
ACCEPT
ER
sp
CASH
GENERATION
TARGETS
ERM
EITHER
CASH
GENERATION
sp
OR
RATIO
OF
WORKING
sp
CAPITAL
sp
TO
ER
TO
SALES
AND
THAT
KIND
OF
THING
AND
ERM
AS
sp
WELL
AS
ER
PROFIT
sp
TO
TURN
OVER
ISSUES
AND
THAT'S
ER
STOOD
US
IN
GOOD
STEAD
THIS
sp
YEAR
AND
WE'VE
BEEN
SAYING
TO
CHIEF
sp
EXECUTIVES
IF
YOU
CAN'T
GET
THE
PROFIT
OR
YOU
CAN'T
GET
THE
SALES
WELL
AT
LEAST
CONCENTRATE
ON
TRYING
TO
TRYING
TO
GET
THE
CASH
GET
THE
DEBTORS
IN
THAT
KIND
OF
THING
AND
sp
WE
THINK
THAT'S
ER
ER
sp
GONE
WELL
TOO
AND
OF
COURSE
sp
WE'VE
TRIED
sp
TO
REINFORCE
OUR
MARKET
POSITIONS
AND
I
THINK
WE'VE
SUCCEEDED
IN
ER
IN
sp
VIRTUALLY
ALL
OF
OUR
BUSINESSES
ER
NOW
IF
WE
LOOK
AT
THE
sp
ER
STAFF
REDUCTION
BY
sp
SECTOR
AGAIN
sp
WHEN
I
SPOKE
TO
YOU
DURING
THE
INTERIMS
I
WAS
EXPECTING
REDUNDANCIES
sp
DURING
THE
YEAR
OF
OF
ER
ABOUT
A
THOUSAND
IN
THE
EVENT
WE'VE
ACHIEVED
FOURTEEN
HUNDRED
sp
NEARLY
FOURTEEN
HUNDRED
AND
THAT
FOLLOWS
ON
THE
SIX
HUNDRED
REDUNDANCIES
WE
HAD
LAST
YEAR
ER
AND
AS
WELL
AS
sp
THE
ERM
STAFF
REDUCTION
INITIATIVES
ER
sp
STAFF
REDUCTION
INITIATIVES
THAT
THIS
SHOWED
YOU
THE
SAVINGS
ER
IN
THE
YEAR
MOST
sp
OF
sp
THE
SAVINGS
OF
COURSE
COMING
NEXT
sp
YEAR
A
SMALL
sp
SAVING
THIS
YEAR
AS
WELL
AS
THAT
WE
MANAGED
sp
TO
RESTRICT
THE
PAY
ROUND
FOR
THE
WHOLE
OF
PEARSON
IN
THE
U
K
TO
sp
FOUR
PERCENT
GOING
sp
TO
sp
OTHER
COST
SAVING
INITIATIVES
ERM
IN
THE
NEWSPAPERS
WE'VE
WE
MADE
LOTS
OF
sp
SAVINGS
IN
NEWSPRINT
THIS
WAS
USUALLY
NEGOTIATING
BETTER
DISCOUNTS
IN
SOME
OF
OUR
PRODUCTION
CENTRES
REDUCING
THE
WEB
WIDTH
WHICH
OF
COURSE
SAVES
NEWSPRINT
AND
IN
MANY
sp
AREAS
ER
IN
THE
REGIONAL
sp
NEWSPAPERS
REDUCING
sp
THE
DISTRIBUTION
OF
OUR
FREEZE
IN
{OOV}
AREAS
WHERE
WE
THOUGHT
IT
ER
IT
WOULDN'T
AFFECT
IT
WOULDN'T
sp
HAVE
AFFECTED
THE
PERFORMANCE
sp
OF
THE
TITLE
ER
ON
THE
BOOK
SIDE
WE'VE
MANAGED
ER
CONSIDERABLE
REDUCTIONS
IN
FREIGHT
COSTS
WAREHOUSING
AND
PRINTING
IN
ENTERTAINMENT
I'D
THINK
THE
{OOV}
sp
COST
sp
REDUCTIONS
THERE
WERE
PRETTY
WELL
ER
RESTRICTED
TO
GOOD
sp
HOUSEKEEPING
BUT
FROM
FINE
CHINA
ER
WE
sp
MANAGED
TO
TRANSFER
THE
THE
ER
WORK
sp
IN
THE
MINTON
FACTORY
TO
THE
KNOWLE
STREET
sp
FACTORY
AND
THAT
ALLOWED
sp
US
sp
TO
CLOSE
sp
THE
MINTON
sp
FACTORY
AND
QUITE
APART
FROM
THE
REDUNDANCIES
THAT
ENTAILED
WE
SAVED
SOMETHING
LIKE
TWO
HUNDRED
AND
FIFTY
THOUSAND
ER
NON
STAFF
RELATED
OVERHEAD
ER
GROUP
WIDE
sp
IN
THE
U
S
A
THE
ER
NEW
YORK
HEADQUARTERS
STAFF
sp
UNDER
sp
DAVID
{GAP_ANONYMIZATION_NAME}
'S
DIRECTION
ACHIEVED
sp
A
VERY
WORTHWHILE
ER
REDUCTION
sp
IN
TELECOMS
TWO
MILLION
A
YEAR
AND
sp
THIS
WAS
BY
ER
AGGREGATING
OUR
TELECOMS
ERM
BUSINESS
AND
NEGOTIATING
AN
ER
ONE
CONTRACT
sp
AND
THEY'VE
JUST
ABOUT
sp
COMPLETED
A
SECOND
ONE
ON
FREIGHT
WHICH
WILL
SAVE
TWO
MILLION
DOLLARS
A
YEAR
AND
WE'RE
LOOKING
TO
TO
DO
SIMILAR
TRANSACTIONS
IN
THE
sp
U
K
BUT
sp
OF
COURSE
sp
WITH
THE
LACK
OF
OR
THE
REDUCED
COMPETITION
IN
THE
U
K
sp
WE
WE
MAY
NOT
DO
QUITE
AS
WELL
ER
ON
CAPITAL
EX
sp
EXPENDITURE
ER
sp
MOST
OF
THE
CAPITAL
YOU
SEE
sp
THERE
WAS
ERM
INVESTMENT
WHICH
WILL
SHOW
A
RETURN
ER
ON
INVESTMENT
ER
THE
BIG
ITEMS
WERE
BRIGHTON
WHERE
WE'RE
SPENDING
TEN
ELEVEN
MILLIONS
ER
sp
WITH
sp
THE
NEW
sp
PRESS
AND
THE
NEW
BUILDING
WHICH
IS
PRETTY
WELL
COMPLETED
ER
IT
VERY
SHORTLY
WILL
BE
ON
STREAM
ERM
sp
THE
OIL
COMPANY
CONTINUE
TO
INVEST
IN
CAPITAL
EXPENDITURE
sp
AS
IT
SHOULD
DO
AND
ER
MOST
OF
THAT
IS
SPENT
BETWEEN
SERVICES
DRILLING
AND
sp
AND
RADAR
AND
AT
TUSSAUDS
WE
CONTINUE
TO
INVEST
sp
ER
sp
ALTON
sp
TOWERS
HAS
GOT
ER
THE
GHOST
HOUSE
OPENING
TODAY
AND
THE
RUNAWAY
TRAIN
AND
WE
WERE
FINISHING
sp
OFF
THE
MARYLEBONE
ROAD
sp
PROJECT
WHICH
IS
A
VERY
BIG
BIG
PROJECT
INVOLVING
ER
RE
THE
COMPLETE
sp
REFURBISHMENT
ER
NEW
SHOPS
AND
A
VIEW
sp
RIGHT
THERE
IN
THE
BASEMENT
AND
SO
THE
sp
ER
THE
REWARD
FOR
OUR
FIRM
GRIP
ON
COSTS
AND
sp
THE
CONCENTRATION
ON
CASH
IS
A
FAVOURABLE
SWING
OF
OF
sp
FORTY
SEVEN
ER
MILLION
POUNDS
IN
THE
FULL
YEAR
AND
THERE
SHOULD
BE
MORE
TO
COME
BECAUSE
sp
NOW
WE'RE
AT
THE
END
OF
OUR
ER
CAPITAL
SPEND
ON
NEWSPAPERS
sp
ER
sp
THE
NEWSPAPERS
WILL
OF
sp
COURSE
BECOME
VERY
sp
SUBSTANTIAL
CASH
GENERATORS
WE
LOOK
AT
THE
ER
PROFIT
sp
OF
THE
NEWSPAPERS
INDIVIDUALLY
OF
COURSE
IT
sp
WAS
A
VERY
VERY
DIFFICULT
YEAR
FOR
THE
FINANCIAL
TIMES
AD
SALES
sp
WERE
sp
DOWN
sp
FOURTEEN
sp
PERCENT
ER
sp
BUT
sp
WE
sp
ER
WE
INCREASED
OUR
sp
MARKET
sp
SHARE
sp
AND
sp
IN
FACT
OUR
sp
MARKET
SHARE
WAS
sp
THE
BEST
SINCE
NINETEEN
EIGHTY
SIX
ER
WHEN
THE
F
T
WAS
THE
MARKET
LEADER
CIRCULATION
WAS
DOWN
FOUR
PERCENT
BUT
OVERSEAS
WE
INCREASED
sp
OUR
sp
CIRCULATION
sp
BY
FIVE
PERCENT
AND
AGAIN
IN
THE
U
K
IN
IN
NEWSPAPER
SALES
WE
HELD
OUR
MARKET
SHARE
ER
sp
PROFILE
DID
sp
VERY
sp
WELL
sp
INCREASING
SALES
sp
BY
TWELVE
sp
PERCENT
sp
LAST
YEAR
sp
AND
FOLLOWING
sp
THE
DEAL
WITH
TEXLINE
ER
SALES
MOVING
WELL
AHEAD
AGAIN
THIS
YEAR
ER
LES
ECHO
HAD
PROBLEMS
ON
sp
THE
MEDICAL
sp
SIDE
PARTLY
GOVERNMENT
REGULATION
PARTLY
THE
MARKET
AND
WE'VE
REORGANIZED
ER
TWO
MEDICAL
sp
DIVISIONS
INTO
ONE
AND
THAT
SHOULD
GIVE
US
ER
GIVE
US
SOME
COST
SAVING
THERE
sp
THE
sp
NEWSPAPER
sp
CIRCULATION
WAS
UP
THREE
sp
PERCENT
TO
A
NEW
RECORD
AT
ONE
HUNDRED
AND
TWELVE
THOUSAND
SEVEN
HUNDRED
AND
THAT
WAS
A
VERY
GOOD
sp
PERFORMANCE
AD
VOLUME
WAS
DOWN
ERM
BUT
NOT
AS
MUCH
AS
IN
THE
U
K
THE
ECONOMISTS
HAD
A
TREMENDOUS
YEAR
ERM
REALLY
BUCKING
THE
TREND
AND
CONTRIBUTING
ABOUT
FIVE
MILLION
POUNDS
sp
TO
ER
F
sp
T'S
sp
ER
ASSOCIATES
sp
PROFITS
sp
THE
CIRCULATION
sp
WAS
A
NEW
RECORD
AND
sp
FOUR
HUNDRED
AND
EIGHTY
FIVE
THOUSAND
NINE
HUNDRED
sp
BY
YEAR
END
AND
IT
JUST
SEEMS
TO
GO
FROM
sp
STRENGTH
TO
STRENGTH
ER
WE
SWOPPED
OUR
SHARING
EXPENSE
ON
THE
ER
{OOV}
SPANISH
FINANCIAL
sp
DAILY
ER
sp
WITH
CASH
FOR
A
TWENTY
FIVE
PERCENT
STAKE
IN
THE
{OOV}
GROUP
AND
ER
ONE
OF
THE
THINGS
THIS
ER
DOES
IS
TO
GIVE
US
A
STAKE
IN
IN
MARCA
WHICH
IS
THE
sp
SECOND
sp
BIGGEST
NEWSPAPER
IN
SPAIN
AND
INCIDENTALLY
HAS
THE
SAME
SOCIAL
AND
ECONOMIC
PROFILE
AS
EL
{OOV}
THE
TIMES
OF
SPAIN
ER
AND
IT'S
A
SPORT
PAPER
WHICH
SELLS
SEVEN
DAYS
A
WEEK
TWO
HUNDRED
AND
sp
THIRTY
FOUR
THOUSAND
sp
CIRCULATION
AND
ITS
NEARER
NEAREST
COMPETITOR
SELLS
sp
ONE
sp
FIFTY
THOUSAND
sp
IT'S
A
VERY
BIG
CASH
GENERATOR
FOR
THE
VERY
HIGH
COVER
PRICE
AND
THAT
SHOULD
BENEFIT
FROM
THIS
YEAR'S
OLYMPICS
EXPANSION
ITSELF
WENT
sp
UP
sp
ERM
sp
CIRCULATION
BY
TWENTY
THREE
ER
PERCENT
LAST
YEAR
AND
sp
AD
SALES
sp
WERE
UP
FOURTEEN
sp
PERCENT
WESTMINSTER
sp
PRESS
HAD
A
VERY
DIFFICULT
YEAR
AD
VOLUME
WAS
DOWN
ER
THREE
POINT
sp
FOUR
PERCENT
OVERALL
sp
NEARLY
ALL
OF
THAT
WAS
IN
CLASSIFIEDS
sp
WHERE
ERM
THE
VOLUME
sp
WAS
DOWN
ABOUT
ER
ELEVEN
POINT
EIGHT
sp
NEARLY
sp
TWELVE
PERCENT
AND
ER
REVENUE
DOWN
BY
EIGHT
POINT
THREE
PERCENT
SITUATIONS
VACANT
IN
PARTICULAR
SHOWED
A
VERY
A
VERY
BIG
DROP
AND
ERM
AND
IN
sp
FACT
WE
THE
YIELD
sp
WAS
LOWER
sp
THAN
sp
THE
YEAR
BEFORE
BUT
WE'VE
ER
CONTINUED
WITH
OUR
PAC
PRESS
RATIONALIZATION
PROGRAMME
AND
ER
I
THINK
AS
sp
I
sp
MENTIONED
AT
sp
THE
INTERIMS
THE
BASILDON
EVENING
ECHO
IS
NOW
PRINTED
ON
THE
F
T'S
PRESSES
WHICH
INCIDENTALLY
HAS
GOT
THE
CONTRACT
TO
AND
IS
PRINTING
ER
{OOV}
ERM
BUT
W
sp
P
CONTINUED
TO
ER
HANG
ON
TO
ITS
sp
MARKET
LEADERSHIP
sp
IN
VIRTUALLY
EVERY
CENTRE
AND
ERM
DESPITE
THE
DIFFICULT
sp
YEAR
MANAGED
TO
LAUNCH
ER
SEVERAL
NEW
TITLES
ER
IF
WE
TURN
TO
THE
REVENUE
sp
SPLIT
I
THINK
sp
THIS
sp
UNDERSCORES
THE
RECESSION
ER
AND
YOU'LL
NOTICE
THAT
THERE'S
A
MUCH
LESHER
sp
LESSER
PROPORTION
OF
REVENUE
COMING
FROM
ADVERTISING
ER
THEY'RE
OVERALL
sp
FIGURES
sp
BUT
FOR
INSTANCE
sp
THE
F
T
WHICH
ER
THE
YEAR
BEFORE
SEVENTY
FIVE
sp
PERCENT
OF
ITS
REVENUE
CAME
FROM
ADVERTISING
AND
ER
IN
IN
sp
NINETY
sp
ONE
IT
WAS
DOWN
TO
SEVENTY
PERCENT
IF
WE
GO
ON
TO
BOOKS
ERM
sp
I
THINK
THAT
LONGMAN
sp
PERFORMANCE
IS
EXCEPTIONALLY
GOOD
ERM
OF
COURSE
FOR
BOOK
BUSINESS
sp
IT'S
VERY
MUCH
FIRST
sp
HALF
SECOND
HALF
MOST
OF
THE
sp
PROFIT
COMING
IN
SECOND
HALF
BUT
ER
sp
ERM
sp
LONGMAN
ONLY
DROPPING
sp
SEVEN
PERCENT
ON
THE
YEAR
BEFORE
SEEMS
sp
TO
ME
A
PARTICULARLY
GOOD
PERFORMANCE
sp
GIVEN
THE
ENVIRONMENT
AND
IN
FACT
IT
GENERATED
MORE
OPERATING
CASH
FLOW
THAN
sp
THE
YEAR
BEFORE
sp
IT
DID
VERY
WELL
WITH
ENGLISH
LANGUAGE
TEACHING
SALES
ER
IN
EUROPE
AND
ASIA
sp
AS
PLANNED
AND
ITS
MEDICAL
AND
PROFESSIONAL
SPONSORED
{OOV}
sp
ERM
sp
BUSINESS
IN
IN
JAPAN
GREW
MUCH
QUICKER
THAN
WE
sp
EXPECTED
BUT
EDUCATION
sp
IN
sp
THE
U
K
AND
CANADA
WAS
VERY
VERY
sp
TOUGH
INDEED
sp
PITMAN
WHICH
IS
THE
sp
U
sp
K
LEADING
ER
BUSINESS
BOOK
PUBLISHER
INCREASED
sp
SALES
sp
BY
SIXTEEN
PERCENT
AND
sp
ALHAMBRA
AFTER
THE
ER
sp
REORGANIZATION
IS
sp
DOING
RATHER
WELL
AND
THE
FIRST
sp
BOOK
WE'VE
sp
PUBLISHED
sp
ON
THE
NEW
SPANISH
EDUCATIONAL
CURRICULUM
IS
sp
FORTY
PERCENT
AHEAD
OF
ER
BUDGET
ALI
ADDISON
WESLEY
sp
WAS
ER
ONE
OF
OUR
STARS
sp
THIS
YEAR
ER
A
FOURTH
YEAR
OF
RECORD
PROFITS
sp
RECORD
ER
SALES
RECORD
MARGIN
WITH
THE
SCHOOLS
sp
BUSINESS
THIRTY
SEVEN
PERCENT
sp
AHEAD
OF
THE
PREVIOUS
YEAR
sp
WITH
OUR
SUCCESSFUL
MATHS
sp
PROGRAMME
AIDED
AND
ABETTED
sp
BY
{OOV}
ER
sp
THE
BUSINESS
sp
THAT
PRODUCES
THE
MANIPULATIVES
TO
GO
WITH
THE
MATHS
PROGRAMME
THE
COLLEGE
MARKET
IN
THE
U
S
A
WAS
THE
WEAKEST
FOR
DECADES
sp
BUT
OUR
COLLEGE
sp
SALES
sp
WERE
UP
TEN
PERCENT
INTERNATIONALLY
sp
WE'RE
UP
THIRTEEN
PERCENT
AND
IN
THE
EUROPE
AND
EUROPE
AND
PACIFIC
TWENTY
PERCENT
AND
ON
THE
ER
GENERAL
sp
BOOK
FRONT
THE
sp
ERM
IRON
JOHN
sp
WAS
ON
sp
THE
NEW
YORK
TIMES
sp
BEST
SELLERS
LIST
FOR
FIFTY
ONE
WEEKS
sp
AND
TWELVE
OF
THOSE
AT
sp
NUMBER
ONE
I'LL
DEAL
WITH
sp
PENGUIN
SEPARATELY
FEDERAL
AND
CAPITAL
sp
WE
ER
IS
IS
A
SMALL
BUSINESS
ER
BUT
sp
HIGHLY
sp
PROFITABLE
sp
AND
ER
IT'S
A
SUBSCRIPTION
BUSINESS
SO
THAT
THE
CASH
sp
COMES
IN
ADVANCE
AND
ER
THE
ER
THE
ONLY
CRITICISM
I
sp
HAVE
OF
FEDERAL
sp
AND
CAPITAL
IS
sp
THAT
sp
IT'S
IT
IT
IT
IT
WOULD
BE
NICE
IF
IT
WAS
FIVE
sp
TIMES
sp
BIGGER
THAN
IT
IS
BUT
sp
WE'RE
WORKING
ON
THAT
LOOKING
AT
PENGUIN
ER
IT
WAS
A
VERY
DIFFICULT
sp
YEAR
BUT
THE
PROFIT
YOU
sp
SEE
WAS
ERM
IS
AFTER
sp
PROVIDING
sp
FOR
THE
LOSSES
UP
TO
THE
DATE
WE
DISPOSED
OF
SMITH
MARK
AND
ALSO
MAKING
FURTHER
PROVISION
sp
ON
ON
ER
LEASES
WHEN
WE
MOVED
OUT
OF
THE
OTHER
BUILDINGS
CENTRALIZED
sp
THE
EDITORIAL
AND
ER
sp
ADMINISTRATIVE
FUNCTIONS
INTO
ONE
OFFICE
AND
AND
BUT
FOR
THAT
YOU
WOULD
SEE
THAT
THE
ER
THE
PENGUIN
PROFIT
WOULD
HAVE
MOVED
AHEAD
sp
FROM
THE
YEAR
BEFORE
ERM
SOME
OF
YOU
ARE
sp
VERY
sp
CRITICAL
OF
OF
OF
THE
PENGUIN
OPERATION
sp
WHEN
YOU
WERE
IN
THE
U
S
A
BUT
I
HAVE
sp
TO
TELL
sp
YOU
THEY
DID
ACHIEVE
RECORD
SALES
THERE
LAST
YEAR
AND
INCREASED
sp
MARKET
SHARE
AND
IN
sp
FACT
THE
CHILDREN'S
ER
BOOK
PUBLISHING
sp
WAS
sp
TWENTY
PERCENT
sp
AHEAD
sp
OF
sp
THE
YEAR
BEFORE
IN
sp
THE
sp
U
sp
K
sp
THE
sp
IMPROVEMENT
sp
PLANS
sp
WE'VE
BEEN
sp
WORKING
ON
FOR
sp
THE
LAST
TWO
YEARS
sp
HAVE
BEEN
VERY
SUCCESSFULLY
IMPLEMENTED
BUT
THEY'VE
BEEN
OVERTAKEN
sp
BY
THE
U
K
RECESSION
IN
THE
U
S
A
WE'VE
APPOINTED
JOHN
{GAP_ANONYMIZATION_NAME}
PRESIDENT
AND
SO
WE'VE
GOT
THE
STRUCTURE
THAT
WE
WANTED
WITH
PETER
{GAP_ANONYMIZATION_NAME}
AS
AS
CHAIRMAN
AT
THE
TOP
AND
CONCENTRATING
ON
ER
ON
PUBLISHING
sp
AS
HE
OUGHT
TO
ONE
OF
THE
GREAT
PUBLISHERS
OF
THE
WORLD
DEALING
WITH
THE
AUTHORS
DEALING
WITH
THE
sp
AGENTS
AND
DEALING
WITH
THE
sp
EDITORIAL
STAFF
WITH
A
MANAGING
DIRECTOR
IN
U
K
TREVOR
{GAP_ANONYMIZATION_NAME}
AND
A
MANAGING
DIRECTOR
PRESIDENT
IN
sp
THE
U
S
A
sp
JOHN
{GAP_ANONYMIZATION_NAME}
AND
ER
JOHN
{GAP_ANONYMIZATION_NAME}
HAD
A
VERY
GOOD
START
AND
WE'RE
SURE
sp
THIS
WILL
BE
AN
IMPROVED
ER
STRETCHER
FROM
OUR
BUSINESS
TURNING
TO
TURNING
TO
ENTERTAINMENT
AND
MEDIA
INVESTMENTS
ER
IT
WAS
A
VERY
TOUGH
YEAR
FOR
THE
TUSSAUD
GROUP
sp
AND
STARTING
WITH
THE
ER
GULF
WAR
ER
AND
ERM
THE
ONLY
TUSSAUD
BUSINESS
THAT
THAT
DOES
A
LOT
OF
BUSINESS
IN
THE
FIRST
QUARTER
IS
ERM
MARYLEBONE
ROAD
AND
sp
YOU
sp
MAY
sp
REMEMBER
THAT
THE
GULF
WAR
CAUSED
FOREIGN
TOURISTS
TO
STOP
COMING
TO
LONDON
AND
ER
ALSO
ERM
sp
BRITISH
TOURISTS
STOPPED
COMING
TO
LONDON
AND
DURING
THAT
TIME
ATTENDANCES
WERE
ACTUALLY
TWENTY
FIVE
PERCENT
sp
DOWN
SO
THE
RECOVERY
sp
FROM
THERE
IS
HAS
BEEN
VERY
GOOD
OUR
HIGHLIGHT
WAS
THE
OPENING
OF
sp
SCENERAMA
OUR
DUTCH
sp
EXHIBITION
WHICH
OPENED
IN
MID
YEAR
AND
THAT'S
sp
WELL
AHEAD
OF
BUDGET
sp
AND
BY
YEAR
sp
END
WE'D
HAD
SIX
HUNDRED
THOUSAND
ADMISSIONS
THROUGH
THE
TURNSTILES
ALTON
ER
DID
WELL
ER
TO
RESTRICT
ATTENDANCES
TO
A
sp
FIVE
sp
PERCENT
DROP
I
SHOULD
REMIND
YOU
OF
COURSE
THAT
WE
HAVE
THE
USUAL
sp
THREE
MILLION
BLACK
HOLE
ALTON
THIS
YEAR
THE
FIRST
QUARTER
AT
CHESSINGTON
sp
ATTENDANCES
PRETTY
WELL
STOOD
STILL
sp
AGAIN
A
VERY
GOOD
PERFORMANCE
IN
MY
VIEW
AND
ER
JUSTIFICATION
sp
FOR
THE
CAPITAL
SPENDING
THAT'S
GONE
ON
IN
RECENT
YEARS
TO
BRING
THAT
ER
TO
BRING
CHESSINGTON
TO
WHERE
WE
WANT
IT
TO
BE
WARWICK
sp
TOO
sp
HAD
A
VERY
GOOD
PERFORMANCE
AND
ER
AND
MAINTAINED
sp
ITS
ER
ATTENDANCES
ER
TURNING
TO
THE
MEDIA
INVESTMENTS
WELL
WE
ALL
TEND
TO
THINK
THAT
sp
THE
ER
THE
BIDS
TENDED
TO
BE
sp
ON
THE
HIGH
SIDE
BUT
ER
AT
LEAST
YORKSHIRE
GOT
sp
THE
LICENCE
FOR
THE
NEXT
TEN
YEARS
AND
THEY
HAVE
THE
OPTION
IN
sp
NINETY
EIGHT
TO
GO
FOR
A
FURTHER
TEN
YEARS
AND
I
CAN
TELL
YOU
ER
BECAUSE
I'VE
HAD
ER
LOTS
OF
CONVERSATIONS
WITH
CLIVE
{GAP_ANONYMIZATION_NAME}
THAT
THEY'RE
REALLY
WORKING
ON
ON
MAKING
sp
THE
sp
BEST
IMPROVING
THEIR
RETURNS
FROM
THAT
FRANCHISE
AND
I'M
QUITE
SURE
THEY'LL
SUCCEED
PICKWICK
AS
YOU
KNOW
WE
SOLD
ER
DURING
THE
YEAR
OR
SORRY
WHEN
THE
sp
YEAR
sp
ENDED
THIS
YEAR
TURNING
TO
ER
CAMCO
OUR
OLD
SERVICES
CAMPAIGN
AGAIN
THAT
ER
I
THINK
THAT
WAS
A
VERY
sp
VERY
GOOD
PERFORMANCE
ER
SALES
WERE
AHEAD
sp
OF
LAST
YEAR
TRADING
PROFIT
AHEAD
sp
OF
sp
LAST
sp
YEAR
sp
AND
THEY
sp
EVEN
sp
PROVED
sp
IMPROVED
THE
MARGIN
VERY
VERY
SLIGHTLY
AND
THAT'S
OUR
SECOND
STAR
OF
sp
THE
YEAR
ERM
PRODUCTS
AND
SERVICES
DID
VERY
WELL
INTERNATIONALLY
IN
sp
FACT
THE
ENTIRE
BUSINESS
DID
WELL
INTERNATIONALLY
GENERALLY
PARTICULARLY
IN
sp
VENEZUELA
NIGERIA
AND
BY
YEAR
END
THE
ER
JOINT
VENTURE
IN
RUSSIA
WAS
ER
WAS
COMPLETE
AND
READY
TO
START
WE
sp
ALSO
DID
A
sp
VERY
sp
IMPORTANT
ER
sp
TECHNOLOGY
TRANSFER
TO
CZECHOSLOVAKIA
sp
WHICH
ER
UNSUBMERSIBLE
PUMP
NECK
TECHNOLOGY
AND
THAT'S
TENDED
TO
TO
ERM
HIDE
A
SLIGHT
{OOV}
ER
DECLINE
IN
THE
LAST
QUARTER
OF
THE
YEAR
NORMALLY
IN
OIL
MOST
OF
THE
PROFIT
OR
MORE
OF
THE
PROFIT
COMES
IN
THE
SECOND
HALF
sp
THAN
sp
THE
sp
FIRST
sp
BUT
sp
WITH
sp
THE
sp
GULF
WAR
LAST
sp
YEAR
sp
OIL
PRICES
sp
WERE
PRETTY
FIRM
AND
sp
ER
sp
SO
WE'VE
sp
MADE
ER
QUITE
REASONABLE
PROFITS
sp
IN
THE
sp
IN
sp
THE
ER
sp
FIRST
HALF
AND
SO
TOO
IN
THE
SECOND
sp
HALF
BUT
IN
THE
LAST
sp
QUARTER
THEY'VE
BEEN
SHOWED
UP
BY
THAT
sp
TECHNOLOGY
ER
TRANSFER
AND
THE
ER
U
S
OIL
PRICE
IS
ER
IS
IS
ER
STAG
THE
U
K'S
IS
STAGNANT
THE
U
S
sp
IS
sp
STAGNANT
sp
IN
sp
OIL
sp
AND
THE
sp
GAS
sp
PRICES
ARE
VERY
VERY
FAR
DOWN
THEY'RE
WELL
sp
DOWN
sp
TURNING
TO
INVESTMENT
sp
BANKING
AND
I
SHOULD
JUST
REMIND
YOU
THAT
ER
WE
TAKE
FIFTY
sp
PERCENT
sp
OF
sp
{OOV}
BROTHERS
PROFITS
sp
AND
sp
TEN
sp
PERCENT
OF
NEW
YORK
sp
AND
PARIS
AND
sp
GIVEN
THE
sp
CONDITIONS
sp
GIVEN
sp
THE
sp
ENVIRONMENT
sp
LAST
sp
YEAR
sp
I
DON'T
sp
THINK
sp
{OOV}
NEED
sp
BE
sp
ASHAMED
sp
OF
THE
sp
PERFORMANCE
sp
ER
ALTHOUGH
IN
sp
LONDON
THE
ONLY
BUSINESS
TO
REALLY
COME
IN
COME
IN
WITH
IMPRESSIVE
RETURNS
WAS
ER
ASSET
TRADING
MONEY
BROKING
AND
BANKING
sp
THERE
WAS
ERM
A
GREAT
REDUCTION
IN
CORPORATE
ACTIVITY
BUT
CORPORATE
FINANCE
sp
KEPT
VERY
BUSY
sp
ER
WITH
THEIR
VALUE
SERVICES
AND
MONEY
RAISING
AND
ER
WE
WERE
RESPONSIBLE
FOR
THE
sp
NATIONAL
POWER
sp
FLOTATION
AND
THE
DISPOSAL
OF
GRATTON
IN
PARIS
sp
ER
sp
{OOV}
WERE
TOP
OF
THE
M
AND
A
LEAGUE
BUT
sp
THE
VOLUME
WAS
sp
WELL
DOWN
ON
sp
THE
RECORD
NINETEEN
NINETY
NEW
YORK
TOO
sp
DID
WELL
ADVISING
sp
ON
THIRTY
SEVEN
sp
ACQUISITIONS
ER
THIRTY
SEVEN
TRANSACTIONS
sp
INCLUDING
{OOV}
sp
ACQUISITION
OF
TONKA
AND
{OOV}
ACQUISITION
OF
THE
MAX
FACTOR
DIVISION
OF
REVLON
ON
FINE
sp
CHINA
ERM
ALTHOUGH
PROFITS
WERE
DOWN
ROYAL
DOULTON
DID
MANAGE
A
MARGIN
OF
EIGHT
POINT
FIVE
PERCENT
AND
HERE
AGAIN
sp
IMPROVED
sp
THE
CASH
FLOW
ON
NINETEEN
NINETY
sp
AND
sp
THEY
CONTINUED
sp
TO
sp
DEVELOP
sp
THEIR
sp
DISTRIBUTION
AND
RETAIL
sp
NETWORK
sp
AND
sp
NOW
OVER
HALF
OF
OUR
SALES
sp
ARE
OVERSEAS
sp
AND
ER
WE
DEVELOPED
OUR
DIRECT
MAIL
AND
OUR
CHAIN
STORE
BUSINESS
sp
ER
EVEN
THOUGH
DEMAND
WAS
DOWN
IN
FACT
WE
MADE
MOST
OF
OUR
PROFITS
OR
A
LOT
sp
OF
OUR
PROFITS
LAST
YEAR
BY
ERM
SHEER
sp
VOLUME
AND
AND
AND
A
DECLINE
IN
YIELD
ERM
A
BIGGER
SALE
OF
THE
SMALLER
PRICE
IT
OF
THE
LESSER
PRICED
sp
ITEMS
sp
I
MENTIONED
sp
EARLIER
sp
THAT
sp
WE
sp
CLOSED
THE
ERM
sp
ROYAL
MINTON
sp
FACTORY
sp
AND
sp
FOUR
OTHER
sp
FACTORIES
ARE
ON
SHORT
TIME
BUT
WE
CONTINUED
TO
INVEST
IN
OPERATION
EFFICIENCY
sp
TO
IMPROVE
OUR
COMPETITIVE
POSITION
AND
ER
NOW
OVER
TO
ER
TO
JAMES
{GAP_ANONYMIZATION_NAME}
JAMES
GOOD
MORNING
EVERYONE
WELL
AS
sp
YOU
CAN
SEE
FROM
WHAT
FRANK
SAID
THE
SIX
MAIN
sp
SECTORS
OVERALL
DIDN'T
FARE
TOO
BADLY
sp
SIXTEEN
PERCENT
DROP
IN
AGGREGATE
AT
THE
sp
TRADING
sp
LEVEL
AND
IN
FACT
ER
OUR
sp
OTHER
INTEREST
LESS
EXPENSES
WERE
ACTUALLY
ENDED
ON
ELEVEN
PERCENT
BECAUSE
WE
HAD
A
MILLION
POUNDS
MORE
PROFIT
FROM
LAKESIDE
WHEN
sp
WE
SOLD
THE
TESCO
'S
SITE
HOWEVER
THE
DAMAGE
WAS
DONE
AT
THE
DISCONTINUED
LINE
WHICH
SIMPLY
REFLECTS
THE
FACT
THAT
WE
HAD
ER
ELSERVER
sp
IN
FOR
TWO
AND
A
HALF
MONTHS
IN
NINETEEN
NINETY
ONE
AS
OPPOSED
TO
TWELVE
MONTHS
THE
sp
YEAR
BEFORE
SO
TRADING
PROFITS
DOWN
TWENTY
sp
FOUR
PERCENT
AND
ALTHOUGH
THE
INTEREST
CHARGE
WAS
DOWN
ER
QUITE
SHARPLY
LARGELY
OF
COURSE
AS
A
REDUCTION
IN
NET
DEPTH
THROUGH
sp
THE
ELSERVER
SALE
PROFITS
BEFORE
TAX
ENDED
UP
AS
YOU
sp
HEARD
BEFORE
TWENTY
THREE
sp
PERCENT
sp
LOWER
IF
sp
WE
sp
GO
FROM
THAT
TO
THE
EARNINGS
THERE'S
sp
ANOTHER
ERM
ER
SLIDE
sp
TO
TAKE
sp
US
THROUGH
THAT
I
THINK
sp
THE
MOST
INTERESTING
POINT
HERE
IS
sp
THE
TAX
CHARGE
sp
WHICH
IS
sp
TWO
sp
PERCENTAGE
POINTS
DOWN
ON
sp
THE
YEAR
BEFORE
AND
THAT
REALLY
sp
IS
PRIOR
YEAR
sp
ADJUSTMENTS
THERE
ARE
OTHER
PLUSES
AND
MINUSES
sp
BUT
THAT'S
A
SIGNIFICANT
REASON
EXTRAORDINARY
PROFITS
YOU
MAY
BE
SURPRISED
TO
sp
SEE
ARE
ONLY
TWELVE
POINT
NINE
MILLION
AFTER
THE
ELSERVER
SALE
BUT
THAT
IS
A
FUNCTION
sp
OF
sp
THE
WRITE
BACK
OF
GOOD
sp
WILL
ON
THE
DISPOSAL
OF
ELSERVER
sp
WHICH
YOU
WILL
SEE
sp
EXPLAINED
IN
THE
sp
PRELIMINARY
sp
STATEMENT
THUS
REDUCING
THE
ER
PROFIT
FROM
TWO
sp
HUNDRED
AND
TWENTY
NINE
MILLION
WHICH
WAS
THE
ESTIMATE
AT
THE
INTERIM
TO
THIRTY
FIVE
MILLION
FOR
THE
YEAR
AS
A
WHOLE
WE
DID
THAT
IN
THE
{OOV}
WITH
sp
THE
ERM
URGENT
ISSUES
TASK
FORCE
NEW
STANDARD
ON
GOOD
WILL
sp
WE
HAD
TO
DO
IT
sp
COS
I'M
A
sp
MEMBER
OF
THE
TASK
FORCE
I
MEAN
I'D
BE
SACKED
sp
OTHERWISE
sp
SO
EARNINGS
AFTER
EXTRAORDINARIES
UP
FIFTY
FOUR
sp
PERCENT
ER
EVEN
SO
NOW
THE
PROFITS
THE
sp
PROFITS
YOU'VE
SEEN
sp
WHERE
THE
PROFITS
CAME
sp
DOWN
LET'S
LOOK
AT
IT
ANOTHER
WAY
AND
THAT
IS
REALLY
TO
SEE
ER
sp
THE
IMPACT
sp
PER
sp
THE
sp
YEAR
sp
BEFORE
FIFTY
sp
THREE
MILLION
sp
DOWN
IN
PROFITS
sp
OVERALL
sp
FOREIGN
EXCHANGE
sp
WORKED
sp
TO
OUR
ADVANTAGE
sp
THIS
YEAR
THE
DOLLAR
WAS
AT
ONE
SEVENTY
TWO
ON
AVERAGE
ER
WE
HAD
sp
OBVIOUSLY
sp
NO
sp
HELP
sp
FROM
sp
ACQUISITIONS
BECAUSE
OF
THE
ELSERVER
EFFECT
LESS
INTEREST
OUR
EXCEPTIONAL
ITEMS
WERE
RATHER
HEAVIER
IN
NINETEEN
NINETY
ONE
YOU
WON'T
BE
SURPRISED
AFTER
WHAT
YOU
HEARD
FROM
FRANK
ABOUT
THE
ER
NUMBER
REDUCTIONS
WE
HAD
REDUNDANCY
COST
WE
HAD
LEASE
PROVISION
AND
ONE
OR
TWO
OTHER
ITEMS
SO
THE
UNDERLYING
PERFORMANCE
sp
IN
FACT
ACCOUNTED
FOR
ONLY
FORTY
MILLION
OUT
OF
THE
FIFTY
THREE
MILLION
REDUCTION
IN
PROFITS
NOW
AGAIN
sp
WE
sp
NEED
TO
DISTRIBUTE
THE
UNDERLYING
PERFORMANCE
BECAUSE
IT
WASN'T
EQUALLY
DISTRIBUTED
BETWEEN
THE
VARIOUS
SECTORS
NOW
CLEARLY
THE
TWO
MAJOR
ER
BADDIES
THERE
WERE
THE
NEWSPAPERS
AND
INVESTMENT
BANKING
AND
THAT
REFLECTS
THEIR
OPERATIONAL
GEARING
AND
THE
SHARP
DECLINE
IN
sp
REVENUE
YOU
ARE
WELL
AWARE
OF
sp
THE
TWO
PLUSES
ARE
BOOKS
THANKS
sp
LARGELY
TO
ADDISON
WESLEY
THANKFULLY
DECISIVELY
SO
AND
THE
OIL
SERVICES
BUSINESS
AND
THE
ONLY
OTHER
ITEM
WORTH
sp
REFLECTING
I
THINK
WORTH
ER
REMARKING
ON
IS
sp
IN
sp
FACT
sp
THAT
IF
YOU
TAKE
OUT
THE
BLACK
HOLE
EFFECT
ER
THE
ENTERTAINMENT
FALL
sp
WAS
ONLY
TWO
MILLION
AND
I
THINK
THAT
IS
A
CREDITABLE
PERFORMANCE
SO
IF
sp
WE
NOW
LEAVE
sp
PROFITS
AND
GO
TO
CASH
ER
THE
CASH
sp
FLOW
IS
SLIGHTLY
CROWDED
AND
sp
TO
WE'VE
SPLIT
IT
INTO
TWO
SLIDES
sp
YOU
CAN
SEE
ER
AT
THE
TOP
OF
sp
COURSE
THE
PROFITS
WERE
sp
DOWN
BUT
sp
NONETHELESS
ER
I
THINK
QUITE
ENCOURAGINGLY
WE
HAVE
HIGHER
OPERATIONAL
sp
CASH
sp
FLOW
AND
sp
I'LL
GO
INTO
A
LITTLE
DETAIL
OF
sp
THAT
sp
LATER
sp
ER
A
sp
SHARP
sp
FALL
IN
sp
THE
sp
INTEREST
TAX
AND
sp
DIVIDENDS
LINE
LED
TO
THE
FORTY
FIVE
MILLION
sp
TURNROUND
AT
WHAT
WE
REGARD
THE
CRUCIAL
MEASURE
NET
FUNDS
FROM
OPERATION
THIS
sp
TELLS
sp
YOU
sp
WHETHER
sp
YOU'RE
GENERATING
sp
MONEY
sp
FOR
sp
SHAREHOLDERS
OR
WHERE
THEY
sp
CONSUME
YOU
IF
WE
LOOK
AT
THE
NEXT
SLIDE
YOU'LL
THEN
SEE
ER
sp
THE
CHANGE
FROM
NET
FUNDS
FROM
OPERATIONS
PLUS
EIGHTEEN
MILLION
sp
DOWN
TO
THE
VARIOUS
LARGE
REDUCTION
sp
IN
sp
BORROWINGS
YOU'RE
ALREADY
AWARE
OF
AND
OF
COURSE
sp
THE
ERM
DISPOSALS
LESS
ACQUISITIONS
AS
sp
IT
SHOULD
READ
FOR
NINETY
ONE
ER
STANDS
OUT
THERE
WE
SPENT
sp
ONLY
REALLY
sp
MODEST
sp
AMOUNTS
sp
APART
FROM
sp
THERE
WAS
sp
A
sp
SMALL
FURTHER
INVESTMENT
sp
IN
sp
B
SKY
B
sp
NOTHING
ELSE
WORTH
RECORDING
SO
sp
TURNROUND
IN
A
NET
DEBT
OF
THREE
sp
HUNDRED
sp
AND
sp
TWENTY
MILLION
AND
I
sp
THINK
WE
WILL
LOOK
AGAIN
NOW
AT
THE
NET
FUNDS
FROM
OPERATION
AND
LOOK
AT
THE
ANALYSIS
A
LITTLE
FURTHER
TRADING
PROFIT
LESS
sp
POTENTIAL
WAS
ONLY
DOWN
TWENTY
FIVE
MILLION
BECAUSE
OF
COURSE
A
sp
GOOD
SLICE
sp
OF
THE
REDUCTION
IN
TRADING
PROFITS
CAME
sp
FROM
ER
ASSOCIATES
MAINLY
ELSERVER
WHICH
IS
RATHER
NIGGLY
IN
sp
DISTRIBUTIONS
THE
WORKING
sp
CAPITAL
OUTFLOW
sp
WAS
CONTROLLED
AND
WAS
ONLY
ER
SIXTEEN
MILLION
MORE
WORKING
sp
CAPITAL
WHICH
sp
IS
CONSIDERABLY
BETTER
sp
THAN
THE
YEAR
BEFORE
AND
THEN
FINALLY
YOU
HAD
THE
ER
IMPROVEMENT
IN
THE
CAPITAL
sp
EXPENDITURE
CAPITAL
EXPENDITURE
LESS
DEPRECIATION
IS
EIGHTEEN
MILLION
BETTER
THAT'S
OF
COURSE
A
FUNCTION
OF
TWO
ER
sp
ELEMENTS
sp
THE
REDUCTION
sp
IN
THE
{OOV}
AND
sp
THE
sp
PERSISTENT
RISE
THE
DEPRECIATION
CHARGE
WHICH
IS
sp
GOING
OVER
THE
LAST
FOUR
YEARS
AS
WE
MAINTAIN
A
HIGH
LEVEL
OF
CAPITAL
SPENDING
IMPROVEMENT
IN
OPERATING
CASH
FLOW
WAS
THEN
COMPOUNDED
BY
ER
THE
FINANCING
LINE
AND
THAT
REALLY
sp
IS
OVERWHELMINGLY
ER
A
sp
REDUCTION
sp
IN
sp
TAX
sp
PAID
sp
FUNCTION
sp
OF
THE
LOWER
PROFITS
THAN
PREVIOUS
YEARS
AND
OF
sp
COURSE
sp
THE
IMPACT
OF
CONSORTIUM
RELIEF
sp
IN
B
SKY
B
sp
NET
CHANGE
FORTY
FIVE
MILLION
POUNDS
AND
THAT
WE
REGARD
AS
ONE
OF
sp
THE
sp
MOST
SATISFYING
sp
OUTCOMES
FOR
THE
sp
YEAR
NOW
ELSERVER
sp
ALSO
sp
IMPACTED
OF
COURSE
MATERIALLY
ON
THE
BALANCE
SHEET
AS
THE
sp
NEXT
SLIDE
WILL
SHOW
US
sp
CURIOUSLY
NET
TRADING
sp
ASSETS
ARE
VIRTUALLY
UNCHANGED
BETWEEN
sp
THE
TWO
YEARS
THIS
IS
OBVIOUSLY
A
COINCIDENCE
SINCE
sp
IT'S
A
FUNCTION
OF
SO
MANY
DIFFERENT
THINGS
sp
INCLUDING
EXCHANGE
EFFECTS
sp
HOWEVER
THE
BALANCE
BETWEEN
DEBT
AND
EQUITY
IS
REMARKABLY
sp
CHANGED
YOU'LL
sp
HAVE
sp
THE
SHARP
IMPROVEMENT
IN
SHAREHOLDERS
FUNDS
RESULTING
FROM
sp
THE
WRITE
BACK
OF
GOOD
sp
WILL
ON
THE
ELSERVER
DISPOSAL
AND
THE
CONSEQUENT
sp
REDUCTION
IN
NET
BORROWINGS
FROM
FOUR
HUNDRED
AND
FIVE
TO
A
HUNDRED
AND
EIGHTEEN
MILLION
sp
NOW
NET
DEBT
OF
THE
HUNDRED
AND
sp
EIGHTEEN
MILLION
IS
OF
COURSE
ER
A
BALANCE
OF
TWO
ITEMS
WE
HAVE
OUR
DEBT
ITSELF
THE
GROSS
DEBT
WHICH
CAME
DOWN
sp
ABOUT
sp
A
sp
HUNDRED
AND
TWENTY
MILLION
AND
THAT
IS
ALL
SET
BY
A
sp
SUBSTANTIALLY
sp
INCREASED
CASH
BALANCE
THE
CASH
IS
OVERWHELMINGLY
HELD
IN
STERLING
WE
NEED
A
HUNDRED
MILLION
OF
IT
TO
ER
sp
PAY
BACK
{OOV}
COUPON
BOND
sp
THAT
MATURES
IN
MAY
AND
BY
THE
SAME
REASON
sp
THE
FINAL
COLUMN
SHOWS
THAT
THE
BALANCE
OF
OUR
DEBT
BETWEEN
FIXED
AND
sp
FLOATING
ER
WILL
CHANGE
sp
OTHER
THINGS
BEING
EQUAL
ON
THE
PRO
FORMA
sp
BASIS
sp
AT
sp
THE
MOMENT
OR
AT
THE
YEAR
END
OF
OUR
VARIABLE
DEBT
COMMERCIAL
PAPER
IN
THE
UNITED
STATES
A
VERY
CHEAP
FORM
OF
DEBT
FORMED
THE
sp
OVERWHELMING
PROPORTION
OUR
FIXED
DEBT
IS
ACCOUNTED
FOR
BY
OUR
QUOTED
STERLING
BONDS
AND
ER
THE
BALANCE
OF
A
MEDIUM
TONE
NOTE
PROGRAMME
WHICH
WE
HAVE
OUTSTANDING
IN
THE
UNITED
STATES
ON
THE
PRO
FORMA
BASIS
OUR
HOPES
WHICH
OF
COURSE
NOT
YET
BEEN
BORN
OUT
THAT
INTEREST
RATES
WILL
BE
DECLINING
ER
WILL
GIVE
US
SOME
ADVANTAGE
BY
THE
YEAR
END
AS
A
NUMBER
OF
CAPS
AND
SWABS
WHICH
WE
PUT
IN
sp
PLACE
DURING
sp
NINETEEN
NINETY
ONE
UNWIND
NOW
BALANCE
SHEET
WITH
THE
LOWER
DEBT
AND
PROMISING
CASH
FLOW
OF
COURSE
IMPACTS
ON
FINANCIAL
RATIOS
AND
I
THINK
THAT
THIS
IS
THE
BEST
MEASURE
OF
HOW
WE
COME
THROUGH
NINETEEN
NINETY
ONE
RATHER
THAN
THE
PROFITS
THE
DIVIDEND
COVER
IS
NOT
WONDERFUL
BUT
IT'S
PERFECTLY
{OOV}
ADEQUATE
AS
MICHAEL
{GAP_ANONYMIZATION_NAME}
SAID
AT
THE
BEGINNING
INTEREST
COVER
WAS
ALREADY
STRONG
AND
IS
NOW
AT
NEARLY
TEN
sp
TIMES
PATENTLY
ER
A
VERY
sp
HEALTHY
LEVEL
AND
WHETHER
OR
NOT
YOU
ADD
BACK
THE
GOOD
WILL
ON
OTHER
ER
ACQUISITIONS
I
DARE
SAY
THE
RATIO
IS
AT
A
VERY
LOW
LEVEL
INDEED
CLEARLY
sp
WE
HAVE
PLENTY
OF
POWDER
AND
IT'S
sp
DRY
THANK
YOU
ER
WE
ARE
GOING
TO
BE
JOINED
ER
FOR
QUESTIONS
BY
DAVID
{GAP_ANONYMIZATION_NAME}
WHO
IS
ER
THE
CHAIRMAN
sp
OF
CAMCO
AND
sp
THE
U
THE
PEARSON
sp
EXECUTIVE
DIRECTOR
RESIDENT
IN
THE
U
S
MICHAEL
{GAP_ANONYMIZATION_NAME}
WHO
IS
sp
ER
C
E
O
GROUP
AND
HUGH
{GAP_ANONYMIZATION_NAME}
WHO
IS
C
E
sp
O
OF
sp
WESTMINSTER
sp
PRESS
ER
sp
FINANCIAL
NEWSPAPERS
sp
WHEN
YOU
ER
ASK
A
QUESTION
FIRST
TIME
COULD
YOU
COULD
YOU
SAY
YOUR
NAME
sp
AND
THE
ORGANIZATION
THAT
YOU
REPRESENT
COULD
I
HAVE
THE
FIRST
QUESTION
PLEASE
IT'S
MARK
{GAP_ANONYMIZATION_NAME}
FROM
THE
DAILY
TELEGRAPH
CAN
I
JUST
ASK
YOU
IF
YOUR
POSITION
ON
THE
DAILY
MIRROR
IS
STILL
THAT
YOU'RE
NOT
AT
ALL
sp
INTERESTED
IN
sp
IT
OR
IS
sp
THERE
A
PROSPECT
THAT
YOU
MAY
CHANGE
YOUR
MIND
WHEN
YOU'VE
SEEN
THE
FIGURES
FROM
THE
MIRROR
ER
WE
HAD
A
sp
GOOD
LOOK
AT
AT
THE
FIGURES
ALTHOUGH
sp
THEY
WEREN'T
TOTALLY
FINALIZED
WE
sp
HAD
A
PRETTY
GOOD
UNDERSTANDING
sp
OF
THE
SITUATION
AND
I
THINK
IT
IS
HIGHLY
UNLIKELY
THAT
WE
WOULD
ER
SEEK
TO
RE
OPEN
ANY
sp
NEGOTIATIONS
ER
JASON
{GAP_ANONYMIZATION_NAME}
FROM
THE
INDEPENDENT
sp
JUST
A
sp
SUPPLEMENTARY
ON
THAT
THIS
ER
YOUR
COMMENT
THAT
YOU
HAD
A
GOOD
LOOK
AT
THE
FIGURES
SEVERELY
CONFUSED
THE
MERCHANT
BANKERS
WHO
ARE
ADVISING
THE
MIRROR
GROUP
AS
THEY
THEY
DIDN'T
FEEL
sp
THAT
sp
THEY'D
FINALIZED
THE
FIGURES
THEMSELVES
sp
SO
sp
DID
YOU
HAVE
A
A
MOLE
INSIDE
THE
MIRROR
GROUP
ER
JAMES
sp
WOULD
YOU
LIKE
TO
ANSWER
sp
THAT
QUESTION
WELL
I'M
NOT
A
MOLE
NO
sp
I
THINK
THAT
WE
HAD
A
FAIRLY
sp
CLEAR
IDEA
CERTAINLY
ON
THE
PENSION
FUND
WE'VE
NOT
OBVIOUSLY
GOT
sp
ACCURATE
sp
NUMBERS
A
CLEAR
IDEA
OF
THE
BROAD
ER
SHAPE
sp
OF
sp
OF
THE
PROBLEMS
AND
ERM
sp
THAT
ALLOWED
US
WITHOUT
HAVING
sp
TO
WAIT
FOR
VERY
ACCURATE
FIGURES
TO
DRAW
THE
CONCLUSIONS
ABOUT
THE
SCALE
OF
sp
THE
PROBLEM
THE
AMOUNT
OF
INVESTMENT
WE'D
LIKE
TO
WE
NEED
TO
MAKE
sp
AND
sp
THUS
sp
ERM
WHETHER
OR
NOT
IT
WAS
OF
INTEREST
TO
PURSUE
YOU
DIDN'T
NEED
TO
HAVE
A
A
LONG
FORM
REPORT
IN
FRONT
OF
YOU
I
THINK
sp
TO
DRAW
THE
CONCLUSION
ER
RICHARD
{GAP_ANONYMIZATION_NAME}
FROM
sp
THE
SCOTSMAN
CAN
I
JUST
ASK
YOU
TO
BE
SLIGHTLY
MORE
SPECIFIC
sp
ON
YOUR
FIRST
ANSWER
DOES
THAT
MEAN
YOU'RE
NOT
ACTUALLY
INTERESTED
IN
ANY
PARTS
OF
THE
sp
MIRROR
GROUP
I
REFER
PARTICULARLY
ALSO
TO
sp
THE
THE
DAILY
RECORD
AND
sp
THE
sp
SUNDAY
MAIL
IN
SCOTLAND
ER
I'LL
BE
MORE
I'LL
BE
CLEARER
ER
WE
ARE
NOT
INTERESTED
IN
ANY
PARTS
OF
THE
MIRROR
GROUP
ER
RAYMOND
{GAP_ANONYMIZATION_NAME}
FINANCIAL
TIMES
COMPANIES
WITH
AS
STRONG
A
BALANCE
SHEET
AS
YOURS
HAVE
BEEN
KNOWN
TO
sp
SEEK
ACQUISITIONS
ER
IN
THE
MIDST
OF
A
VERY
DEEP
RECESSION
WHY
HAVE
YOU
NOT
DONE
sp
SO
sp
ER
THERE
ARE
A
COUPLE
OF
FACTORS
THERE
ONE
sp
IS
THAT
WE
DO
MAKE
sp
ACQUISITIONS
WE
ON
ON
THE
sp
WHOLE
ER
sp
PREFER
ER
ORGANIC
GROWTH
sp
BECAUSE
sp
IT
sp
IS
NORMALLY
MORE
sp
PROFITABLE
AND
THE
PRICES
YOU
HAVE
TO
PAY
FOR
ACQUISITIONS
sp
ER
sp
TEND
TO
PUT
SIGNIFICANT
PREMIUMS
sp
ON
sp
THE
sp
COMPANIES
YOU
BUY
WHICH
YOU
MAY
ER
IN
THE
LONGER
RUN
EVENTUALLY
ERM
ER
TURN
INTO
SHAREHOLDER
VALUE
BUT
ER
ANY
ACQUISITION
HAS
TO
FIT
sp
EXTREMELY
WELL
sp
STRATEGICALLY
AND
IT
HAS
TO
BE
AT
A
PRICE
THAT
WE
CONSIDER
TO
BE
A
A
A
GOOD
PRICE
NOW
SO
FAR
ER
THE
ACQUISITIONS
THAT
HAVE
COME
ONTO
THE
MARKET
HAVEN'T
REALLY
REFLECTED
ER
THE
TRADING
CONDITIONS
IN
WHICH
ALL
COMPANIES
IN
THIS
COUNTRY
HAVE
BEEN
OPERATING
FOR
THE
LAST
EIGHTEEN
MONTHS
IN
{OOV}
OTHER
WORDS
THERE
HAVEN'T
BEEN
PARTICULARLY
GOOD
VALUE
sp
ACQUISITIONS
THAT
ARE
STRATEGICALLY
SUITABLE
FOR
sp
US
IT
DOESN'T
MEAN
TO
SAY
THAT
WE
ARE
NOT
ON
THE
ALERT
AND
ON
THE
LOOK
OUT
AND
ER
I
THINK
THOSE
OPPORTUNITIES
ERM
ER
WILL
STILL
OCCUR
sp
AND
THAT
ER
WE
WILL
BE
INVOLVED
NOW
THERE'S
ONE
OTHER
ELEMENT
THAT'S
WORTH
MENTIONING
ERM
IT
IS
PERHAPS
ONLY
IN
THE
LAST
ER
SIX
MONTHS
OR
SO
THAT
THE
ERM
TURNAROUND
IN
THE
FORTUNES
OF
ERM
ER
B
SKY
B
HAVE
BEEN
ACKNOWLEDGED
AND
ER
I
THINK
THERE
HAS
BEEN
AN
ELEMENT
IN
OUR
THINKING
sp
THAT
WE
sp
WANTED
sp
TO
sp
KEEP
OUR
{OOV}
DRY
ER
UNTIL
sp
SUCH
sp
TIME
sp
AS
ER
sp
B
sp
SKY
B
sp
WHICH
sp
WE
HAVE
GREAT
sp
BELIEF
AND
FAITH
IN
AND
OUR
AS
sp
YOU
KNOW
WE
INCREASED
OUR
INVESTMENT
DURING
THE
YEAR
ERM
SEES
ITS
WAY
THROUGH
TO
PROFITABILITY
AND
I'M
HAPPY
TO
SAY
THAT
THAT'S
sp
HAPPENING
NOW
AT
A
{OOV}
REASONABLE
RATE
AND
THAT
THAT
MEANS
THAT
IT
IS
HIGHLY
UNLIKELY
sp
THAT
THE
HUNDRED
AND
THIRTY
MILLION
OF
GUARANTEES
THAT
WE
STILL
HAVE
OUTSTANDING
TO
B
sp
SKY
B
ARE
LIKELY
TO
BE
CALLED
SO
WE'RE
IN
A
PRETTY
STRONG
POSITION
TO
MAKE
ACQUISITIONS
IF
THEY
APPEAR
AT
sp
THE
RIGHT
PRICE
AND
THEY
FIT
OUR
STRATEGIC
FRAMEWORK
SORRY
THAT
WAS
RATHER
A
LONG
ANSWER
YES
SIR
WILLIAM
{GAP_ANONYMIZATION_NAME}
DAILY
MAIL
ERM
YOU
A
sp
LOT
OF
PEOPLE
NOW
TALK
AS
THOUGH
IT'S
ERM
PLAIN
sp
SAILING
OR
FLYING
FOR
B
SKY
B
AND
IT'S
GON
NA
BE
ER
HUNKY
DORY
sp
WHEREAS
ANGLIA
TELEVISION
HAVE
JUST
WRITTEN
THEIR
sp
STAKE
DOWN
TO
A
PRENOMINAL
sp
AMOUNT
sp
BECAUSE
THEY
sp
DON'T
THINK
IT'S
GON
NA
MAKE
STAND
A
CHANCE
OF
MAKING
sp
A
PROFIT
BEFORE
THE
TURN
OF
sp
THE
MILLENNIUM
DO
YOU
sp
THINK
sp
THEY'RE
BEING
TOO
GLOOMY
AND
DO
YOU
THINK
CERTAIN
sp
OTHER
PEOPLE
ARE
sp
BEING
TOO
EUPHORIC
sp
I
THINK
THAT
sp
THE
REASONS
sp
PEOPLE
HAVE
WRITTEN
DOWN
sp
THEIR
ERM
ER
HOLDINGS
IN
B
sp
B
SKY
B
HAVE
VARIED
ER
SOMETIMES
IT'S
sp
FOR
TAX
sp
REASONS
sp
SOMETIMES
sp
IT'S
FOR
ER
FOR
FOR
sp
FOR
ERM
ER
REASONS
SUCH
AS
LAST
sp
YEAR
WHEN
ER
sp
WE
WROTE
sp
DOWN
OUR
OUR
sp
STAKE
BY
SOME
SEVENTY
sp
ONE
MILLION
ERM
IT
WAS
BECAUSE
AT
THAT
POINT
THE
FINANCING
FOR
B
SKY
B
WAS
NOT
YET
ER
AT
ALL
CLEAR
BECAUSE
THE
sp
SHAREHOLDERS
HAD
BEEN
UNABLE
sp
TO
AGREE
AT
THAT
POINT
ERM
THAT
THEY
WOULD
GUARANTEE
THE
TWO
sp
HUNDRED
OR
SO
MILLION
THAT
ER
NEEDED
TO
GO
IN
BEFORE
THE
ER
PROJECT
BECAME
SUCCESSFUL
sp
AND
SO
THERE
WAS
sp
A
sp
GENUINE
DOUBT
ON
THE
FINANCING
sp
ER
I
sp
DON'T
KNOW
IF
JAMES
AGAIN
YOU
MIGHT
LIKE
TO
COMMENT
WE'LL
KEEP
sp
FRANK
IN
RESERVE
HE'S
A
CHAIRMAN
AT
B
SKY
B
ER
sp
I
THINK
ER
FRANK
WILL
CORRECT
ME
IF
WE'RE
CLOSER
TO
THE
TO
sp
THE
SHARP
EDGE
THAN
ANGLIA
WHO
HAVE
GOT
A
VERY
SMALL
STAKE
sp
AND
ONLY
IN
sp
THE
EQUITY
OF
B
S
B
H
ARE
COMING
VERY
LOW
IN
THE
PECKING
ORDER
sp
TO
sp
GET
THEIR
MONEY
sp
WHEREAS
ER
WHERE
THERE
IS
A
WHOLE
COMPLEX
ER
SCHEDULE
OF
WHO
WILL
PARTICIPATE
IN
THE
ER
SUBSTANTIAL
CASH
FLOW
sp
THAT
WE
EXPECT
TO
EMANATE
FROM
B
sp
SKY
B
IN
DUE
COURSE
BUT
I
THINK
THAT'S
THE
MAIN
REASON
WHY
ANGLIA
I
HAVEN'T
TALKED
TO
DAVID
{GAP_ANONYMIZATION_NAME}
FRANK
sp
DO
YOU
TALK
WELL
I
MEAN
IT'S
IT'S
sp
DEFINITELY
TAX
DRIVEN
sp
I
MEAN
ERM
ANGLIA
TALKED
ER
TALKED
sp
TO
ME
ANYWAY
AS
CHAIRMAN
OF
sp
B
SKY
B
ERM
BEFORE
THEY
BEFORE
THEY
DID
THE
WRITE
sp
OFF
AND
sp
IT'S
IT'S
JUST
sp
TAX
DRIVEN
SO
YOU'RE
sp
RIGHT
AT
THE
HEAD
OF
THE
PECKING
ORDER
PARDON
YOU'RE
RIGHT
AT
THE
HEAD
sp
OF
THE
sp
PECKING
sp
ORDER
WHEN
THE
CASH
sp
GENERATION
sp
STARTS
YOU'LL
BE
FIRST
IN
LINE
ER
WE
WILL
BUT
THE
sp
PECKING
ORDER
ER
THE
PECKING
ORDER
IS
sp
THE
SUBJECT
OF
AGREEMENT
AND
IT'S
PUBLIC
ER
BUT
I
MEAN
CLEARLY
THE
THE
DEBT
AND
THE
GUARANTEES
ARE
PAID
DOWN
FIRST
AND
SO
FOR
THE
REASON
WE
ARE
HIGH
UP
IN
THE
PECKING
ORDER
BECAUSE
sp
WE
PROVIDED
THE
ER
THE
LOANS
AND
THE
GUARANTEES
sp
YES
sp
FOLLOWING
THAT
UP
WHEN
WHEN
sp
CAN
sp
YOUR
sp
LONG
SUFFERING
SHAREHOLDERS
ER
sp
EXPECT
sp
TO
SEE
ANY
RETURN
ON
sp
THE
sp
B
sp
SKY
B
sp
STAKE
AND
sp
A
sp
FOLLOW
UP
ON
THAT
NOW
YOU'VE
GOT
SIXTEEN
PERCENT
sp
AND
YOU'RE
THE
CHAIRMAN
WHEN
SHOULDN'T
YOU
EQUITY
ACCOUNT
sp
IT
WELL
I'M
NOT
CERTAIN
OUR
SHAREHOLDERS
ARE
LONG
SUFFERING
sp
ERM
IN
FACT
sp
I
THINK
sp
THE
TURNAROUND
HAS
ER
HAS
BEEN
sp
REMARKABLY
QUICK
AND
REMEMBER
WE
sp
SAVED
OUR
SHAREHOLDERS
FROM
HAVING
TO
sp
WRITE
THE
LOT
OFF
SO
I
sp
WOULDN'T
ACCEPT
YOUR
DESCRIPTION
JUSTIFIED
sp
MICK
sp
MM
TAKE
ISSUE
BEYOND
THAT
sp
SORRY
WHAT
WAS
THE
SECOND
PART
OF
THE
QUESTION
WELL
sp
THE
FIRST
PART
OF
sp
THE
sp
QUESTION
WAS
WHEN
WHEN
WILL
THEY
sp
START
SEEING
A
RETURN
sp
BACK
ON
THAT
MONEY
AND
SECONDLY
WHEN
SHOULDN'T
YOU
EQUITY
ACCOUNT
IT
WELL
ER
EQUITY
ACCOUNTING
JAMES
IS
BETTER
PLACED
TO
ANSWER
THAT
QUESTION
THAN
ME
ERM
I'D
BE
VERY
sp
SURPRISED
IF
IF
CASH
IF
IF
B
SKY
sp
B
DOESN'T
sp
START
TO
TRADE
AT
A
PROFIT
OVERALL
IN
sp
ERM
IN
THE
SECOND
HALF
OF
NINETY
THREE
AND
AND
THEREAFTER
CASH
CAN
FLOW
OUT
BECAUSE
THE
FIRST
THING
THAT
FLOWS
OUT
ARE
LOANS
AND
GUARANTEES
SO
WE'RE
WE'RE
sp
QUITE
CLOSE
TO
GETTING
CASH
sp
BACK
FROM
B
SKY
B
SORRY
CAN
I
GET
IT
ABSOLUTELY
CLEAR
sp
I
DIDN'T
sp
FULLY
UNDERSTAND
THAT
ARE
YOU
ACTUALLY
SAYING
ER
sp
MONEY
WILL
ACTUALLY
BE
sp
RAISED
IN
ADDITION
sp
TO
THE
FINANCING
sp
CHARGES
sp
IN
THE
SECOND
HALF
OF
NINETY
THREE
NO
NO
I'M
TALKING
sp
ABOUT
PROFIT
FROM
THE
FROM
sp
THE
sp
BUSINESS
MONEY
FROM
THE
BUSINESS
JUST
TO
CLEAR
ANOTHER
POINT
UP
LAST
AUTUMN
IT
WAS
STATED
IN
A
DOCUMENT
THAT
THERE
sp
WOULD
HAVE
TO
BE
FURTHER
SUBSCRIPTIONS
OF
sp
FINANCE
BEFORE
ER
THE
PROJECT
BECAME
PROFITABLE
ARE
YOU
NOW
SAYING
THAT'S
NO
LONGER
NECESSARY
THAT
IS
THE
TWO
HUNDRED
MILLION
THAT
I
WAS
REFERRING
TO
ER
EARLIER
WASN'T
IN
PLACE
AT
THE
TIME
sp
THAT
WE
MADE
OUR
WRITE
THERE
SO
THAT
WAS
ALL
THE
REMARK
APPLIED
TO
WELL
YES
BUT
THAT
REMEMBER
sp
WE
PROVIDED
FOR
UP
sp
TO
TWO
HUNDRED
MILLION
WHICH
WE
THOUGHT
WOULD
SEE
US
THROUGH
TO
THE
END
OF
NINETY
sp
TWO
NOW
IT
sp
LOOKS
AS
IF
sp
NOT
ALL
OF
THAT
WILL
BE
CALLED
BUT
WE
CAN'T
BE
sp
SURE
AT
THIS
sp
STAGE
BUT
IT
LOOKS
AS
IF
IT
MAY
NOT
ALL
BE
sp
CALLED
sp
SHOULD
sp
I
sp
JUST
sp
COMMENT
sp
ON
sp
THE
sp
ASSESSING
sp
THE
EQUITY
sp
ACCOUNTING
POINT
ER
sp
THE
PRESENT
sp
SITUATION
IS
THAT
THERE'S
COMPLEX
sp
ERM
ARRANGEMENTS
FOR
THE
EXERCISE
OF
VOTES
BASICALLY
UNANIMITY
IS
REQUIRED
AND
IN
THOSE
CIRCUMSTANCES
WE
AS
A
SHAREHOLDER
CAN
NOT
EXERCISE
MATERIAL
sp
INFLUENCE
WHICH
IS
A
NECESSARY
PRE
CONDITION
sp
FOR
EQUITY
sp
ACCOUNTING
sp
OURSELVES
ROGER
{GAP_ANONYMIZATION_NAME}
FROM
THE
GUARDIAN
ERM
CAN
WE
ER
TWO
SEPARATE
QUESTIONS
ONE
IS
GOING
BACK
TO
THE
ISSUE
sp
OF
ACQUISITIONS
ERM
WHERE
ARE
YOU
MOST
sp
INTERESTED
BOTH
sp
GEOGRAPHICALLY
AND
ER
AS
FAR
AS
YOUR
OPERATION
IS
CONCERNED
sp
WHERE
ARE
YOU
MOST
sp
INTERESTED
IN
MAKING
ACQUISITIONS
ER
AND
A
COMPLETELY
SEPARATE
QUESTION
NOW
ENTERTAINMENT
ER
sp
COULD
sp
YOU
JUST
sp
TELL
US
A
BIT
MORE
ABOUT
WHAT'S
HAPPENING
AT
sp
ALTON
sp
TOWERS
AND
ALSO
HOW
YOU
THINK
IT'S
sp
GON
NA
BE
sp
AFFECTED
BY
EURODISNEY
YES
ER
WELL
I
THINK
WE
MIGHT
I'LL
ANSWER
THE
SECOND
QUESTION
BUT
WE'LL
WE'LL
WE'LL
ANSWER
THE
FIRST
QUESTION
BUT
WE'LL
ASK
MICHAEL
WHO'S
RIGHT
HERE
TO
TO
COMMENT
ON
ENTERTAINMENT
IN
FACT
TODAY
sp
THIS
AFTERNOON
WE'RE
sp
LAUNCHING
A
WHOLE
NEW
AREA
AT
ALTON
TOWERS
WHICH
IS
ADDITIONAL
TO
sp
ANYTHING
sp
BEFORE
ERM
FRANK
REFERRED
sp
TO
IT
sp
BRIEFLY
THERE'S
A
RUNAWAY
SO
CALLED
RUNAWAY
TRAIN
RIDE
THERE'S
A
GHOST
HOUSE
sp
AND
THAT'S
ALL
PART
OF
A
sp
NEW
sp
COMPLEX
WHICH
WE'VE
sp
GOT
LONGER
sp
TERM
PLANS
sp
TO
sp
EXPAND
FURTHER
sp
ER
sp
THAT'S
sp
COSTING
sp
SOMETHING
UP
TO
TEN
MILLION
POUNDS
APPROXIMATELY
sp
SO
sp
WE
HAVE
ERM
UNDERLYING
sp
CONFIDENCE
IN
THE
LONG
TERM
FUTURE
OF
sp
ALTON
sp
TOWERS
I
sp
THINK
THAT'S
VERY
IMPORTANT
TO
STATE
AS
FAR
AS
EURODISNEY
IS
CONCERNED
I
PERSONALLY
WELCOME
ITS
ESTABLISHMENT
IN
FRANCE
I
sp
THINK
THAT
IT
IS
GOING
TO
HAVE
A
GOOD
EFFECT
ON
IMPROVING
TRADING
FOR
sp
THE
BETTER
PARKS
AND
ATTRACTIONS
IN
THIS
COUNTRY
sp
AND
AS
YOU
KNOW
I
THINK
ALTON
TOWERS
IS
THE
LEADING
ER
PARK
OF
ITS
KIND
IN
THIS
COUNTRY
CHESSINGTON
WHICH
WE
ALSO
OWN
IS
THE
SECOND
ER
LEADING
PARK
sp
ONE
AND
A
HALF
MILLION
VISITORS
A
YEAR
ALTON
TOWERS
APPROXIMATELY
TWO
MILLION
VISITORS
A
YEAR
IN
THIS
COUNTRY
BOTH
OFFERING
EXCELLENT
sp
VALUE
sp
FOR
MONEY
THE
POINT
I
THINK
THAT
HAS
TO
BE
UNDERSTOOD
sp
ABOUT
EURODISNEY
sp
WHICH
PERHAPS
HASN'T
sp
BEEN
sp
PROPERLY
PERCEIVED
YET
BY
THE
PUBLIC
IS
THAT
IT
IS
VERY
MUCH
A
DESTINATION
FOR
THE
BRITISH
PUBLIC
IT
IS
NOT
A
PLACE
YOU
sp
CAN
JUST
sp
GO
TO
FOR
THE
DAY
AND
THEREFORE
YOU
NEED
TO
SPEND
AT
LEAST
sp
A
sp
COUPLE
OF
DAYS
GETTING
THERE
OVERNIGHT
sp
COMING
BACK
AGAIN
AND
ER
FOR
A
FAMILY
OF
FOUR
I
CALCULATE
sp
THAT
EVEN
sp
TAKING
ONE'S
OWN
CAR
ACROSS
THE
CHANNEL
sp
THE
AVERAGE
COST
FOR
A
FAMILY
OF
FOUR
IS
OF
THE
ORDER
OF
sp
FIVE
sp
OR
SIX
HUNDRED
POUNDS
I
DON'T
SEE
sp
HOW
YOU
sp
CAN
DO
IT
CHEAPER
FOR
THAT
DON'T
FORGET
TO
GET
INTO
DISNEY
IS
TWENTY
FIVE
POUNDS
sp
WHICH
sp
IS
MORE
THAN
DOUBLE
WHAT
WE'RE
CHARGING
AT
ALTON
TOWERS
sp
FOR
sp
EXAMPLE
ER
THE
COMPARABLE
COST
FOR
A
FAMILY
OF
FOUR
IN
THIS
sp
COUNTRY
TO
sp
GO
sp
TO
SOMEWHERE
LIKE
ALTON
sp
TOWERS
OR
TO
CHESSINGTON
IN
YOUR
OWN
CAR
INCLUDING
THE
COST
OF
sp
PETROL
OF
GETTING
sp
THERE
IS
OF
THE
ORDER
OF
FIFTY
sp
OR
SIXTY
POUNDS
AT
THE
OUTSIDE
IN
OTHER
sp
WORDS
ONLY
TEN
PERCENT
OF
sp
THE
TOTAL
COSTS
OF
GOING
TO
DISNEY
THEREFORE
THE
ONE
IS
A
DESTINATION
WHICH
YOU'LL
sp
PROBABLY
FIND
YOU'D
PREFER
TO
GO
TO
FOR
A
LONG
WEEKEND
OR
PERHAPS
sp
A
PART
OF
YOUR
ANNUAL
HOLIDAY
sp
ETCETERA
OUR
PARKS
ARE
PLACES
YOU
GO
sp
TO
FOR
A
DAY
sp
OUT
AND
I
THINK
THEREFORE
sp
THERE
sp
IS
A
VERY
ER
STRONG
DIFFERENCE
sp
BETWEEN
sp
THE
sp
SORT
OF
sp
VISIT
AND
sp
BECAUSE
I
FEEL
THAT
EURODISNEY
WHICH
WILL
UNDOUBTEDLY
WILL
BE
GOOD
IT'S
A
PROVEN
FORMULA
ER
IT'S
RUN
sp
WELL
ER
IT
sp
APPEALS
TO
A
LOT
OF
PEOPLE
sp
AND
THEREFORE
sp
IT
WILL
BE
I
THINK
ER
SUCCESSFUL
EXACTLY
sp
HOW
sp
SUCCESSFUL
I
OBVIOUSLY
sp
CAN'T
SAY
BUT
IT
sp
WILL
BE
SUCCESSFUL
IT
WILL
CERTAINLY
ATTRACT
BRITISH
VISITORS
BUT
THEY'LL
COME
BACK
LOOKING
ER
sp
WITH
sp
CERTAIN
sp
HIGHER
EXPECTATION
A
VALUE
sp
FOR
MONEY
sp
QUALITY
sp
ETCETERA
ETCETERA
AND
sp
WE
sp
BELIEVE
WE
ALREADY
OFFER
THAT
sp
I
THINK
THE
FIGURES
INDICATE
THAT
AND
THEREFORE
IN
sp
THE
MEDIUM
sp
AND
sp
THE
LONGER
TERM
sp
I
sp
BELIEVE
sp
THAT
OUR
ATTRACTIONS
WILL
UNDOUBTEDLY
BENEFIT
AND
I
WOULD
FINALLY
SAY
sp
THAT
IF
YOU
ER
GO
BACK
AND
LOOK
AT
THE
HISTORY
OF
DISNEY
IN
AMERICA
AFTER
THE
ESTABLISHMENT
OF
sp
DISNEY
PARKS
IN
AMERICA
THERE
WAS
A
BIG
IMPROVEMENT
IN
EXTENSION
OF
THE
AMUSEMENT
sp
PARKS
IN
THE
REST
OF
sp
AMERICA
WHICH
ER
THE
TRADITIONAL
THEME
PARKS
SO
CALLED
IN
AMERICA
GREW
sp
IN
THE
PERIOD
AFTER
THE
sp
ESTABLISHMENT
OF
DISNEY
LAND
sp
IN
sp
CALIFORNIA
sp
AND
I
THINK
sp
A
sp
SIMILAR
sp
SORT
OF
THING
IS
GOING
TO
HAPPEN
NOT
PERHAPS
sp
JUST
IN
THIS
sp
COUNTRY
ER
BUT
sp
ALSO
IN
EUROPE
sp
GENERALLY
IN
CERTAIN
LOCATIONS
THERE
ARE
CLEARLY
sp
PLANNING
PROBLEMS
ENVIRONMENTAL
sp
PROBLEMS
THAT
SORT
OF
THING
IN
ESTABLISHING
PARKS
BUT
I
BELIEVE
ER
AND
I
KNOW
A
LOT
sp
OTHER
sp
PEOPLE
IN
THE
LEISURE
BUSINESS
BELIEVE
THAT
THERE
WILL
BE
sp
A
GROWTH
sp
BUT
sp
THE
ONES
THAT'LL
GAIN
WILL
BE
THE
QUALITY
ONES
OFFERING
THE
BEST
VALUE
FOR
MONEY
AND
AS
YOU
KNOW
PEARSON
sp
BELIEVES
IN
sp
QUALITY
AND
CERTAINLY
VALUE
FOR
MONEY
AND
THEREFORE
I
sp
BELIEVE
sp
WE
WILL
BENEFIT
FROM
THAT
THANK
YOU
MICHAEL
ON
ON
ACQUISITIONS
WELL
RUNNING
THROUGH
THE
GROUP
sp
THE
sp
BEST
OF
sp
BANKING
sp
ER
ER
STRATEGIES
TO
REMAIN
sp
NON
CAPITAL
INTENSIVE
sp
AND
STRONGLY
CASH
GENERATIVE
sp
ER
KNOW
sp
YOU
sp
KNOW
WE'VE
sp
HAD
A
TWENTY
MILLION
sp
INVESTMENT
ERM
A
AND
A
ER
A
sp
SWISS
ER
HOUSE
sp
WE'RE
EXTENDING
OUR
NETWORKS
sp
WE'RE
NOT
ER
WE'RE
NOT
THE
sp
BEST
THING
ABOUT
sp
{OOV}
MONEY
AND
sp
I
WOULDN'T
SEE
THAT
HAPPENING
IN
THE
FUTURE
ON
FINE
CHINA
WE'RE
ALREADY
sp
THE
LARGEST
FINE
CHINA
FINE
BONE
CHINA
MANUFACTURER
IN
sp
THE
sp
WORLD
WE
MIGHT
sp
MAKE
THE
ODD
SELECTIVE
ACQUISITION
BUT
NOT
VAST
sp
AMOUNTS
OF
MONEY
GOING
ON
ACQUISITIONS
sp
THERE
EITHER
IN
OIL
SERVICES
IN
THE
FUTURE
THERE
COULD
BE
FURTHER
MAJOR
ACQUISITIONS
sp
BUT
ER
OVER
THE
sp
PAST
sp
THREE
YEARS
sp
WE'VE
ER
UNDERTAKEN
A
WHOLE
sp
SERIES
OF
ACQUISITIONS
AND
ER
AND
FOR
THE
MOMENT
I
WOULDN'T
SEE
ANYTHING
ER
IN
sp
THE
IN
sp
THE
MAJOR
LINE
THERE
ALTHOUGH
YOU
NEVER
KNOW
sp
IF
sp
SOME
EVEN
SOMETIMES
OPPORTUNITIES
sp
YOU
AREN'T
CAPABLE
OF
CREATING
ERM
ER
sp
BECAUSE
THE
ER
SITUATION
IS
NOT
RIGHT
sp
ER
DO
OCCUR
AND
I
sp
WOULDN'T
RULE
IT
OUT
BUT
ERM
ER
WE
HAVEN'T
ERM
ANY
MAJOR
sp
ACQUISITION
ER
ON
ON
ON
THE
sp
CARPET
THERE
AT
THE
MOMENT
ERM
ON
ENTERTAINMENT
WE'RE
SPENDING
A
LOT
OF
MONEY
ON
ORGANIC
GROWTH
AND
HAVE
DONE
OVER
THE
PAST
TWO
OR
THREE
YEARS
AND
ER
IT'S
VERY
sp
WELL
sp
SPENT
BUT
AGAIN
WE'RE
GROWING
OUR
BUSINESSES
ERM
ER
RATHER
THAN
sp
ACQUIRING
THEM
ALTON
TOWERS
CLEARLY
IS
AN
EXCEPTION
BUT
sp
AGAIN
sp
YOU
HAVE
TO
PAY
A
LOT
OF
sp
MONEY
FOR
sp
IT
AND
IT
sp
TAKES
QUITE
sp
SOME
TIME
TO
GET
THE
RETURN
ER
BACK
sp
AND
AND
I
WOULD
SAY
THAT
ERM
MANY
OF
sp
MICHAEL'S
ERM
ER
ORGANIC
ERM
ER
EXPENDITURE
WILL
WILL
ERM
PROVIDE
ER
A
REALLY
GOOD
RETURN
sp
RATHER
QUICKER
BUT
IN
THE
LONG
RUN
sp
WE
sp
THINK
ALTON
IS
GOOD
ERM
NOW
THAT
LEAVES
US
sp
WITH
ER
REALLY
THE
ER
THE
PUBLISHING
THE
EDUCATIONAL
PUBLISHING
ER
THE
NEWSPAPERS
MAGAZINES
ELECTRONIC
sp
PUBLISHING
IN
ALL
THOSE
AREAS
WE'RE
ACTIVE
AND
ON
THE
LOOKOUT
WE
sp
CERTAINLY
IF
YOU
LOOK
AT
THE
BREAKDOWN
OF
OUR
sp
SALES
sp
ER
sp
WE
sp
ONLY
SELL
ABOUT
sp
A
HUNDRED
AND
FIFTY
ER
MILLION
POUNDS
WORTH
ER
OF
GOODS
AND
SERVICES
IN
ASIA
PACIFIC
ERM
WE
WOULD
CERTAINLY
LIKE
TO
MAKE
sp
ACQUISITIONS
IN
THAT
AREA
JUST
AS
WE
DID
IN
NORTH
AMERICA
ER
IN
THE
SEVENTIES
sp
AND
sp
EIGHTIES
sp
AND
WE
HAVE
NOW
SMALL
PEARSON
ER
OFFICE
sp
FOR
INSTANCE
IN
TOKYO
IT'S
QUITE
SLOW
{OOV}
ERM
ER
IN
THAT
AREA
BUT
CERTAINLY
WE'RE
ON
THE
sp
LOOKOUT
sp
FOR
ACQUISITIONS
sp
IN
IN
ASIA
PACIFIC
IN
ALL
OF
THOSE
PUBLISHING
AREAS
sp
THAT
sp
YOU'VE
MENTIONED
NEWSPAPERS
BOOKS
ELECTRONIC
{OOV}
YES
KAREN
sp
{GAP_ANONYMIZATION_NAME}
FROM
NEWS
AUSTRALIA
WOULD
THAT
INCLUDE
sp
TAKING
sp
A
STAKE
IN
THE
ER
sp
THE
sp
FAIRFAX
FLOAT
WHEN
ERM
THAT
TAKES
PLACE
LATER
sp
THIS
YEAR
ERM
WE
WE
sp
WE
sp
REALLY
ER
LIKE
TO
BE
IN
A
POSITION
OF
CONTROL
IN
sp
ANY
sp
OF
THE
ACQUISITIONS
ER
sp
THAT
sp
WE
MAKE
ER
WHERE
WE
ARE
ASSOCIATES
RATHER
THAN
THAN
HAVING
A
HUNDRED
PERCENT
OR
A
LEAST
ERM
OVER
sp
FIFTY
IT
sp
IS
BECAUSE
FOR
STRATEGIC
REASONS
WE'VE
sp
VERY
WANT
TO
MAKE
THE
INVESTMENT
THERE'S
NO
OTHER
WAY
OF
DOING
IT
ERM
TO
CUT
A
LONG
STORY
SHORT
IF
A
ATTRACTIVE
FAIRFAX
sp
ERM
INDIVIDUAL
ENTERPRISE
CAME
UP
WE
WOULD
sp
BE
FAR
MORE
INTERESTED
sp
THAN
sp
TAKING
A
STAKE
THAT
WAS
A
JUST
AN
INVESTMENT
ER
sp
THE
CHANCES
OF
IT
COMING
UP
SEEM
TO
ME
HIGHLY
UNLIKELY
CLEARLY
IF
sp
IT
DID
WE'D
BE
INTERESTED
sp
IS
sp
YOUR
COST
ER
PROGRAMME
EFFECTIVELY
sp
COMPLETE
ER
OR
ARE
WE
GON
NA
sp
BE
sp
SEEING
MORE
SUBSTANTIAL
REDUNDANCIES
THIS
YEAR
WELL
sp
WE'VE
GOT
OUR
COST
REDUCTIONS
AS
AN
ONGOING
PROCESS
ER
SO
sp
IT'S
NEVER
COMPLETE
YOU'RE
ALWAYS
LOOKING
FOR
WAYS
TO
TO
BECOME
MORE
EFFICIENT
OR
sp
EFFECTIVE
BUT
I
DON'T
ANTICIPATE
ANY
REDUNDANCIES
ER
sp
ANY
FURTHER
REDUNDANCIES
BUT
OBVIOUSLY
IF
IF
sp
IF
SYSTEMS
BECOME
AVAILABLE
WHICH
IMPROVE
OUR
EFFICIENCY
AND
EFFECTIVENESS
WE
sp
WE
sp
HAVE
TO
TAKE
sp
ACCOUNT
sp
OF
IT
WHAT
EFFECT
WOULD
A
LABOUR
GOVERNMENT
HAVE
ON
IN
THE
U
K
ON
PEARSON'S
BUSINESSES
WELL
THERE'S
BEEN
QUITE
A
LOT
OF
OF
OF
CHAT
RECENTLY
THAT
THAT
ERM
BECAUSE
OF
CROSS
MEDIA
OWNERSHIP
ERM
COMPANIES
THAT
ARE
INVOLVED
IN
CROSS
MEDIA
OWNERSHIP
WOULD
HAVE
HAVE
PROBLEMS
I
THINK
THAT
IT
IS
DIFFICULT
TO
SEE
UNDER
ANY
CLEAR
COMPLEXION
OF
GOVERNMENT
THAT
OUR
PRESENT
HOLDINGS
ER
IN
NEWSPAPERS
WHICH
ARE
MAINLY
THE
FINANCIAL
TIMES
WHICH
HAS
A
SMALL
ERM
COMPARATIVELY
SMALL
CIRCULATION
FOR
A
NATIONAL
NEWSPAPER
AND
LESS
sp
THAN
TWENTY
PERCENT
IN
A
TELEVISION
COMPANY
WOULD
WOULD
BE
AFFECTED
BY
BY
ANY
GOVERNMENT
ER
WHETHER
THEY
A
DIFFERENT
sp
GOVERNMENT
WOULD
sp
LEGISLATE
ERM
AGAINST
PEOPLE
HAVING
MORE
THAN
A
TWENTY
PERCENT
STAKE
IN
ER
B
SKY
B
FOR
INSTANCE
REMAINS
TO
BE
SEEN
sp
IT
MUST
BE
QUITE
POSSIBLE
WHICH
MIGHT
MEAN
THAT
THERE
sp
WILL
BE
SOME
MORE
SHARES
ER
AVAILABLE
THERE
BUT
sp
ER
THAT
IS
COMPLETE
SPECULATION
ERM
I
DON'T
THINK
THAT
ER
IN
STRUCTURAL
TERMS
sp
THEREFORE
A
A
CHANGE
OF
GOVERNMENT
sp
WOULD
ER
MAKE
A
GREAT
DEAL
A
DIFFERENCE
THEN
YOU
COME
TO
ER
THE
GENERAL
sp
EFFECT
sp
OF
A
sp
A
CHANGE
OF
GOVERNMENT
ER
I
THINK
AT
sp
THE
MOMENT
WE'RE
LIVING
IN
A
SITUATION
sp
OF
UNCERTAINTY
AND
ER
A
CLEAR
MAJORITY
sp
ERM
sp
FOR
ANY
sp
PARTY
WOULD
PROBABLY
FROM
A
BUSINESS
POINT
OF
VIEW
ERM
sp
REMOVE
THE
UNCERTAIN
sp
SHORT
TERM
I
THINK
THE
VIEW
YOU
TAKE
OF
sp
THE
LONGER
TERM
ERM
ER
BECOMES
INDIVIDUAL
AND
SPECULATIVE
ER
sp
AS
ONCE
AGAIN
YOU'VE
GOT
sp
TO
ERM
ER
COME
TO
CONCLUSIONS
sp
ABOUT
sp
INFLATION
sp
ABOUT
ENCOURAGEMENT
TO
THE
ECONOMY
AND
ER
YOU
sp
CAN
sp
READ
IN
MANY
A
GOOD
NEWSPAPER
ERM
sp
THEIR
VIEWS
ON
THAT
sp
THANKS
ER
DID
THE
PROVISION
FOR
ER
PROPERTIES
sp
LIKE
sp
PENGUIN
AND
FOUR
AND
A
HALF
MILLION
FOR
THE
YEAR
DID
ALL
OF
THAT
COME
IN
THE
SECOND
HALF
BECAUSE
IT'S
NOTICEABLE
THAT
PENGUIN
IS
AHEAD
SOMETHING
LIKE
WHAT
THIRTY
TWO
PERCENT
SECOND
sp
HALF
ON
SECOND
HALF
SO
IF
sp
THAT
sp
FOUR
AND
A
HALF
MILLION
WAS
ALL
INCURRED
IN
THE
SECOND
HALF
ITS
UNDERLYING
GROWTH
RATE
WAS
SOMETHING
LIKE
SIXTY
sp
PERCENT
ER
WERE
sp
THERE
ANY
SORT
OF
DISTORTIONS
THERE
IN
THE
SECOND
sp
HALF
PERIOD
WELL
sp
PENGUIN
ALWAYS
MAKES
ER
sp
ER
MOST
OF
sp
ITS
sp
PROFITS
IN
sp
THE
SECOND
HALF
BUT
BUT
JAMES
WOULD
YOU
LIKE
TO
ANSWER
sp
IT'S
MORE
IN
sp
THE
SECOND
HALF
MY
COLLEAGUE
MR
{GAP_ANONYMIZATION_NAME}
sp
WHO
IS
CLOSER
TO
THE
GROUND
sp
REMINDS
ME
THAT
I
THINK
THERE
WAS
A
SMALL
PROVISION
IN
THE
FIRST
sp
HALF
BUT
WE
THEN
TOOK
A
VIEW
ABOUT
sp
ABOUT
FUTURE
YEARS
BECAUSE
IN
A
SENSE
WE'VE
ALWAYS
BEEN
OBVIOUSLY
HAD
TO
PROVIDE
FOR
THE
ER
YEAR
sp
IMPRESSION
DISCRETION
NOW
sp
TAKING
A
MUCH
sp
MORE
REALISTIC
sp
VIEW
sp
ABOUT
THE
NEW
YORK
PROPERTY
MARKET
WHICH
sp
IS
OFFICE
sp
MARKET
sp
WHICH
IS
sp
AS
LOUSY
IF
sp
NOT
LOUSIER
THAN
sp
ERM
THAN
sp
LONDON
AND
SAY
THAT
WE
sp
AIN'T
GON
NA
RELET
THESE
sp
WE'RE
NOT
sp
GON
NA
sp
SUB
LET
THESE
PROPERTIES
LET'S
TAKE
LET'S
sp
TAKE
A
HIT
LET'S
CLEAN
sp
IT
OUT
NOW
AND
THAT
WAS
THAT
ELEMENT
WAS
sp
IN
sp
THE
SECOND
sp
HALF
SORRY
sp
WOULD
THERE
BE
ANY
sp
EXCEPTIONAL
STOCK
PROVISIONS
THAT
sp
WERE
RELEASED
MADE
IN
THE
FIRST
HALF
sp
RELEASED
INTO
THE
SECOND
HALF
FOR
EXAMPLE
SO
YOU
TALKED
sp
ABOUT
PENGUIN
YES
sp
COS
YOU
TALKED
ABOUT
NO
DON'T
MAKE
NO
NO
NO
THAT
sp
WOULDN'T
BE
THE
CASE
sp
NO
ARE
YOU
ER
GOING
TO
HAVE
AN
EXTRAORDINARY
PROFIT
FROM
THE
SALE
OF
THE
STAKE
IN
PICKWICK
SMALL
LOSS
SMALL
LOSS
ER
sp
HUGH
WOULD
YOU
sp
YOU
sp
HAVEN'T
HAD
sp
A
CHANCE
sp
TO
SAY
ANYTHING
WOULD
YOU
LIKE
TO
ER
MAKE
ANY
sp
COMMENTS
ON
sp
ER
HOW
A
CHANGE
OF
GOVERNMENT
MIGHT
EFFECT
THE
sp
WESTMINSTER
PRESS
WELL
I
THINK
IT
ERM
VERY
I
MEAN
I
THINK
sp
AS
sp
YOU
SAID
CHAIRMAN
IF
ERM
THERE'S
A
CLEAR
MAJORITY
FOR
ONE
PARTY
IT'LL
UNBLOCK
A
sp
WHOLE
LOT
OF
DELAY
AND
sp
DECISION
MAKING
WHICH
I
THINK
IS
sp
GOING
ON
sp
AND
I
THINK
sp
THAT
THAT
SHOULD
BE
HELPFUL
I
SUPPOSE
THE
ONLY
PROBLEM
IS
IF
sp
THERE'S
ER
GON
NA
BE
sp
ANOTHER
GENERAL
ELECTION
sp
SHORTLY
AFTER
sp
THE
ONE
sp
WE'RE
ABOUT
sp
TO
sp
HAVE
THAT'LL
JUST
ER
CREATE
A
BIT
MORE
UNCERTAINTY
FOR
A
BIT
LONGER
I'M
AFRAID
ER
RIGHT
ROBERT
{GAP_ANONYMIZATION_NAME}
OF
ROBERT
FLEMING
I
NOTICED
ONE
OF
THE
THE
SUNDAY
PAPERS
HAD
A
LITTLE
BIT
OF
A
DIG
ON
YOU
sp
ON
STRATEGY
OVER
sp
THE
WEEKEND
PERHAPS
ER
YOU'D
JUST
LIKE
TO
REMIND
US
ERM
WHAT
YOUR
STRATEGY
IS
AND
NO
DOUBT
HOW
UNFAIR
YOU
FELT
THAT
COMMENT
WAS
WELL
OUR
STRATEGY
IS
sp
TO
BE
A
CONCENTRATED
CONGLOMERATE
IN
OTHER
WORDS
STICKING
TO
THOSE
SECTORS
THAT
WE
KNOW
AND
UNDERSTAND
AND
WHICH
WE
CHOSE
FOR
THE
NINETIES
BECAUSE
WE
BELIEVE
THEY
sp
HAD
GOOD
GROWTH
sp
PROSPECTS
ER
WE
BUILT
ON
sp
THOSE
SECTORS
DURING
THE
ER
sp
PAST
YEAR
WITH
THE
INITIAL
UNCERTAINTY
ON
THE
B
SKY
B
sp
SITUATION
ER
WE
HAVE
BEEN
MANAGING
ERM
OUR
WAY
THROUGH
THE
RECESSION
YOU'VE
HEARD
FROM
sp
FRANK
ER
sp
ABOUT
sp
THE
ER
IMMEDIATE
SHORT
TERM
MEASURES
WE'VE
sp
TAKEN
ER
BUT
IN
THE
sp
LONG
sp
RUN
WE'RE
ON
THE
LOOKOUT
TO
CONTINUE
TO
sp
BUILD
BOTH
ORGANICALLY
AND
BY
ACQUISITION
WHERE
APPROPRIATE
ER
ON
ON
THE
MAIN
sp
SECTORS
AND
YOU'VE
ALL
HEARD
THE
THEME
OF
QUALITY
WHICH
WHICH
RUNS
sp
THROUGHOUT
OUR
STRATEGIC
PICKING
SORRY
ERIC
ER
THERE
WAS
SOMETHING
PUT
UP
THERE
BEYOND
sp
YOUR
AT
FIRST
YES
{OOV}
JAMES
{GAP_ANONYMIZATION_NAME}
ERM
JAMES
PUT
A
sp
SLIDE
UP
sp
ABOUT
ACCEPT
{OOV}
INCLUDED
A
FIGURE
OF
sp
ERM
EIGHT
MILLION
sp
FOR
EXCEPTIONALS
I
WONDER
IF
YOU
COULD
JUST
EXPLAIN
THE
CONSISTENT
PARTS
OF
THAT
FIGURE
THE
EIGHT
MILLION
ON
sp
EXCEPTIONALS
sp
JAMES
sp
WOULD
YOU
THAT
THAT
IS
THE
THE
CHANGE
IN
EXCEPTIONALS
COMPARED
WITH
NINETEEN
NINETY
IT
ISN'T
sp
THE
TOTAL
CHARGE
AND
IT
sp
COMPRISES
ER
REDUNDANCY
sp
PROVISIONS
ER
sp
COSTS
ON
ABORTIVE
ER
ACQUISITIONS
OR
ERM
CONSULTING
PROJECTS
sp
ER
LEASE
sp
PROVISIONS
sp
IN
sp
PENGUIN
AND
OTHER
ODDS
AND
SODS
BLUNTLY
sp
I
THINK
WE'RE
TALKING
AT
CROSS
PURPOSES
I
THINK
THE
sp
SLIDE
sp
THAT
sp
FRANK
sp
WAS
REFERRING
TO
sp
WAS
THE
TOTAL
CHARGE
sp
FOR
THE
YEAR
sp
THE
sp
EIGHT
MILLION
IS
sp
THE
sp
DIFFERENCE
IN
THE
EXCEPTIONAL
sp
CHARGE
FOR
NINETY
ONE
sp
COMPARED
sp
WITH
NINETEEN
sp
NINETY
THAT
WAS
sp
A
VARIOUS
sp
ANALYSIS
ER
ERIC
sp
CAN
I
{OOV}
sp
YOU
INDICATED
THAT
THERE'S
NO
SIGN
OF
ANY
ER
IMPROVEMENT
IN
YOUR
MAIN
MARKETS
ER
BUT
LOOKING
FOR
ER
OPTIMISTIC
ER
CALCULATIONS
COULD
YOU
GIVE
US
sp
ANY
INDICATIONS
OF
THE
ER
THE
BENEFITS
sp
OF
sp
THE
ER
NON
RECURRENCE
sp
OF
sp
THE
GULF
sp
WAR
IN
THE
FIRST
HALF
WELL
THE
NON
sp
RECURRENCE
OF
GULF
WAR
IN
sp
THE
FIRST
HALF
IS
sp
PRETTY
WELL
BALANCED
BY
THE
RECESSION
sp
THAT
sp
IS
TAKING
PLACE
sp
AT
THE
MOMENT
AND
IS
ER
sp
SHOWING
AS
WE
ALL
KNOW
LITTLE
SIGNS
OF
LIFTING
I
THINK
A
CHANGE
sp
IN
THE
POLITICAL
DIRECT
AND
WHEN
SAY
IT
I
DON'T
MEAN
A
CHANGE
I
MEAN
A
ERM
THE
OUTCOME
sp
OF
THE
SOLUTION
ERM
TO
TO
TO
THE
sp
PRESENT
sp
UNCERTAINTY
I
THINK
ER
WILL
BE
GREATLY
HELPFUL
ER
ONCE
THE
sp
ELECTION
sp
IS
sp
OVER
IN
THE
U
sp
K
ER
BUT
IT
IS
IT'S
VERY
IT'S
VERY
EARLY
DAYS
ER
AS
sp
WE
ALL
KNOW
YOU
sp
SHOWED
US
A
SLIDE
WITH
NET
SAVINGS
FOR
sp
NINETEEN
NINETY
TWO
sp
OF
TWENTY
MILLION
CAN
YOU
ACTUALLY
JUST
TAKE
US
THROUGH
THOSE
sp
ER
sp
ON
ONE
OF
YOU
SLIDES
sp
YOU
HAD
sp
A
sp
THING
NET
SAVINGS
ER
sp
THE
NET
SAVINGS
ON
REDUNDANCIES
OF
TWENTY
MILLION
sp
POUNDS
ARE
sp
THEY
ONLY
sp
REDUNDANCIES
OR
IS
IT
sp
JUST
A
NET
SAVING
sp
OH
sp
THE
NET
SAVINGS
ALTOGETHER
FRANK
sp
WILL
NOW
sp
TAKE
US
THROUGH
THE
THE
NET
SAVINGS
sp
OF
sp
TWENTY
sp
MILLION
ON
REDUNDANCIES
sp
YOU'VE
DONE
IT
ONCE
sp
YEAH
sp
WELL
sp
THE
TWENTY
sp
MILLION
OBVIOUSLY
JUST
COMES
ER
IN
PROP
WELL
NOT
IN
PROPORTION
BECAUSE
THE
SALARY
LEVELS
DIFFER
BUT
IN
sp
PROPORTION
TO
THE
NUMBERS
ER
MADE
REDUNDANT
IN
THE
INDIVIDUAL
sp
COMPANIES
IT'S
QUITE
DIFFICULT
TO
TO
GET
AT
ERM
sp
THE
sp
OTHER
ALL
THE
OTHER
sp
COSTS
BECAUSE
THEY'RE
A
MYRIAD
OF
TINY
sp
THINGS
I
MEAN
THE
BIG
ONES
ERM
OBVIOUSLY
ARE
THE
ERM
sp
SAVINGS
OF
sp
THE
U
S
A
ON
TELECOMMUNICATIONS
AND
FREIGHT
ER
BUT
THEN
sp
THERE'S
LOTS
sp
AND
LOTS
OF
THINGS
sp
FOR
INSTANCE
THE
ONE
I
sp
MENTIONED
AT
MINTON
TWO
HUNDRED
AND
sp
FIFTY
THOUSAND
AND
sp
SO
sp
IN
ALL
OF
OUR
BUSINESSES
YOU
KNOW
THOSE
MANY
MANY
SMALL
ITEMS
IS
sp
THIS
sp
A
COMBINATION
sp
OF
sp
THE
IMPACT
OF
THE
sp
REDUNDANCIES
PLUS
ALL
sp
THESE
OTHER
{OOV}
NOT
JUST
REDUNDANCIES
sp
YES
CAN
I
PICK
UP
ON
YOUR
COMMENT
YOU
DO
NOT
SEE
ANY
UPTURN
IN
ANY
OF
YOUR
MAJOR
MARKETS
ADVERTISING
REVENUE
SEEMS
TO
BE
sp
THERE
SEEMS
sp
TO
sp
BE
SOMETIMES
THAT
THERE
IS
SOME
SLIGHT
PICK
UP
THE
ADVERTISING
ASSOCIATIONS
PREDICTING
A
PICK
UP
THERE
ONE
OR
TWO
COMPANIES
sp
WHO
HAVE
sp
BEEN
REPORTING
HAVE
sp
BEEN
TALKING
ABOUT
A
LITTLE
UPTURN
IN
THE
FIRST
QUARTER
OF
THIS
YEAR
DID
YOU
DON'T
SEE
ANY
DOES
THAT
MEAN
THAT
THEY
ARE
WRONG
OR
YOU'RE
LOSING
MARKET
SHARE
ER
IT
DOESN'T
MEAN
THAT
WE'RE
WRONG
THERE
ARE
SOME
CATEGORIES
OF
ADVERTISING
ER
THAT
ARE
SHOWING
sp
SLIGHT
SIGNS
AND
sp
OTHERS
THAT
ARE
NOT
ER
FRANK
WOULD
YOU
LIKE
TO
COMMENT
I'D
ACTUALLY
I
THINK
THE
PROBLEM
IS
sp
THAT
YOU
GET
THE
ODD
sp
WEEK
sp
ER
AND
EVEN
THE
ODD
MONTH
WHERE
THINGS
LOOK
BETTER
ERM
sp
BUT
sp
BUT
OVERALL
THEN
IT
SLIPS
AGAIN
AND
ER
OVERALL
ERM
sp
THE
END
OF
FEBRUARY
THERE'S
NO
SIGN
THAT
sp
THAT
VOLUME
IS
INCREASING
FROM
THE
PREVIOUS
YEAR
ERM
AND
THAT'S
IN
THE
F
T
AND
THAT'S
IN
W
P
AND
THE
sp
ODD
CATEGORY
WILL
MOVE
AND
I
TALKED
TO
OTHER
PUBLISHERS
ERM
INCLUDING
A
VERY
LARGE
ONE
WHICH
WILL
BE
NAMELESS
sp
AND
sp
THEY
HAVE
A
PRETTY
GOOD
SPREAD
AND
THEIR
EXPERIENCE
WAS
THE
SAME
AS
OURS
SO
ERM
I
DON'T
THINK
THERE'S
ANY
SIGNS
OF
ADVERTISING
HERE
AND
ON
THE
ON
THE
ON
THE
TELEVISION
FRONT
AGAIN
ERM
THERE
ISN'T
A
GREAT
DEAL
ON
THE
TELEVISION
FRONT
AND
THERE'S
QUITE
A
BIT
OF
sp
MANIPULATION
sp
GOING
ON
BUT
ERM
THERE
ISN'T
A
GREAT
DEAL
DEAL
OF
UPTURN
B
SKY
B
IS
AHEAD
OF
LAST
YEAR
BUT
I
MEAN
THAT'S
sp
A
sp
GROWING
BUSINESS
YOU
WOULD
EXPECT
IT
TO
BE
NO
NO
ADVERTISING
IS
IS
STILL
DOWN
IT'S
STILL
IT'S
BEEN
IN
THE
FIRST
TWO
MONTHS
IT'S
BEEN
GOING
sp
DOWN
ON
LAST
YEAR
IN
VOLUME
TERMS
WE
HAVE
HUGH
{GAP_ANONYMIZATION_NAME}
HERE
ER
HUGH
sp
ANY
sp
SIGN
OF
US
LOSING
MARKET
SHARE
NO
SIGN
OF
OUR
NEWSPAPERS
LOSING
MARKET
SHARE
NO
I
THINK
THE
I
MEAN
THE
THE
HUGE
sp
DROP
THAT
sp
WE
HAD
IN
SITUATIONS
VACANT
ADVERTISING
IN
NINETY
NINETEEN
NINETY
ONE
WHEN
WE
FELL
FROM
sp
I
sp
MEAN
sp
OUR
JOB
sp
ADVERTISING
sp
WAS
sp
ABOUT
sp
TWENTY
sp
MILLION
sp
POUNDS
sp
IN
NINETEEN
sp
NINETY
AND
WAS
DOWN
sp
TO
sp
ABOUT
ELEVEN
MILLION
IN
NINETY
ONE
BUT
ERM
THE
POSITION
sp
AT
THE
MOMENT
IS
THAT
I
MEAN
THE
sp
SITUATION
sp
DOESN'T
SEEM
TO
BE
GETTING
ANY
WORSE
ERM
AND
THERE
ARE
THERE
sp
ARE
SOME
SIGNS
OF
sp
ERM
sp
ODD
CATEGORIES
OF
sp
ADVERTISING
BEING
SLIGHTLY
sp
UP
BUT
THEY
ARE
NEED
TO
BE
COUNTER
BALANCED
BY
OTHERS
sp
WHICH
ARE
DOWN
TOO
IT'S
REALLY
VERY
sp
HARD
sp
TO
sp
DETECT
ANY
TREND
YOUR
SHARE
PRICE
SEEMED
sp
TO
TAKE
A
sp
BIT
OF
A
KNOCK
THE
OTHER
DAY
sp
WHEN
ROY
sp
{GAP_ANONYMIZATION_NAME}
MADE
SOME
COMMENTS
sp
ABOUT
REFERRING
MEDIA
CONGLOMERATES
TO
THE
MONOPOLIES
AND
sp
MERGERS
COMMISSION
FIRSTLY
WOULD
YOU
SEE
ANY
PROBLEM
WITH
THAT
sp
UNDER
sp
A
LED
sp
GOVERNMENT
sp
DIRECTLY
sp
AND
sp
SECONDLY
IF
RUPERT
{GAP_ANONYMIZATION_NAME}
WERE
FORCED
sp
TO
SELL
OFF
EITHER
SOME
sp
OF
sp
HIS
STAKE
IN
sp
B
SKY
B
OR
sp
SOME
OF
HIS
NEWSPAPER
INTERESTS
sp
ER
sp
WHAT
WOULD
sp
BE
YOUR
ATTITUDE
TO
ER
sp
BUYING
ER
I
DON'T
sp
THINK
THAT
sp
ER
WE
sp
WOULD
BE
LIKELY
TO
sp
HAVE
A
A
PROBLEM
IN
sp
SELLING
DOWN
WE
ONLY
HAVE
SIXTEEN
sp
PERCENT
OF
sp
B
SKY
B
sp
AND
WE
HAVE
ONE
sp
NATIONAL
NEWSPAPER
THE
sp
FINANCIAL
sp
TIMES
WHICH
ALTHOUGH
INFLUENTIAL
IS
RELATIVELY
SMALL
CIRCULATION
I
DON'T
SEE
ERM
sp
A
GOVERNMENT
OF
ANY
COMPLEXION
BEING
LIKELY
TO
INSIST
ER
ON
OUR
sp
GOING
DOWN
sp
ER
sp
BELOW
TWENTY
PERCENT
ER
IN
TELEVISION
sp
SO
I
DON'T
I
DON'T
sp
PERSONALLY
SEE
THAT
AS
sp
A
DIRECT
sp
THREAT
AT
ALL
AND
I
THINK
THAT
ALSO
OUR
OUR
sp
ER
OUR
NEWSPAPERS
DON'T
HAVE
ANY
PARTICULAR
POLITICAL
sp
BIAS
OF
ANY
SORT
sp
I
THINK
THEY
TREAT
EACH
ISSUE
ON
ITS
sp
MERITS
SO
I
DON'T
SEE
FROM
PEARSON'S
sp
POINT
OF
VIEW
THAT
THAT
A
GOVERNMENT
sp
OF
ANY
sp
COMPLEXION
WILL
ALTER
WHAT
WE
sp
CAN
AND
ER
OR
CAN'T
sp
DO
IN
RELATION
TO
OUR
CURRENT
ER
HOLDINGS
ER
IF
ANY
SHAREHOLDER
IN
sp
B
SKY
B
ER
WAS
sp
SELLING
SHARES
WE
WOULD
OBVIOUSLY
sp
CONSIDER
ER
WHETHER
WE
WENT
sp
UP
FROM
OUR
PRESENT
SIXTEEN
PERCENT
sp
ER
TO
TWENTY
PERCENT
BUT
sp
IT
sp
WOULD
DEPEND
ON
sp
THE
CIRCUMSTANCES
AT
THE
TIME
DEREK
{GAP_ANONYMIZATION_NAME}
{OOV}
COULD
YOU
COMMENT
BRIEFLY
sp
ON
ADDISON
WESLEY
AND
THE
PATTERN
OF
sp
THE
sp
THE
MAJOR
sp
PROGRAMMES
IN
THAT
BUSINESS
AND
ER
WHAT
sp
THE
sp
OUTLOOK
IS
sp
FOR
THE
CURRENT
YEAR
THE
sp
PATTERN
OF
TRADING
AT
ADDISON
WESLEY
AND
AND
THE
PROSPECTS
FOR
THE
CURRENT
sp
YEAR
ER
FRANK
WELL
THE
PROSPECTS
FOR
THE
ER
CURRENT
YEAR
ARE
STILL
GOOD
ERM
I
MEAN
I
sp
REALLY
sp
CAN'T
I
DON'T
EXPECT
THEM
sp
TO
sp
SURGE
AHEAD
AS
THEY
DID
LAST
YEAR
sp
BUT
ALL
THE
SIGNS
ARE
THAT
THAT
THEY'RE
DOING
VERY
sp
WELL
AND
ER
IT'S
A
VERY
WELL
MANAGED
BUSINESS
ERM
GREAT
COST
sp
CONTROL
ER
I
DON'T
sp
KNOW
sp
WHETHER
YOU
NOTICED
RECENTLY
THAT
MERYL
{GAP_ANONYMIZATION_NAME}
DES
sp
DESCRIBED
sp
THE
ERM
THE
MANAGEMENT
OF
ERM
OF
A
W
AS
THE
sp
ER
I
THINK
IT
WAS
THE
CREME
DE
LA
sp
CREME
OF
THE
CLASS
ACT
OF
THE
sp
INDUSTRY
CLASS
ACT
OF
THE
INDUSTRY
sp
SO
IT'S
A
VERY
WELL
sp
MANAGED
sp
BUSINESS
sp
THE
PATTERN
IS
VERY
MUCH
FIRST
HALF
sp
ER
ERM
sp
LOSS
sp
OR
sp
SMALL
PROFIT
sp
SECOND
HALF
ALL
sp
THE
PROFIT
sp
AND
sp
IN
FACT
YOU
SHOULD
sp
WATCH
OUT
FOR
sp
THE
sp
BIGGER
sp
THE
BIGGER
ADDISON
WESLEY
GETS
THE
MORE
sp
THE
LOSS
IN
THE
SECOND
HALF
WILL
BE
BECAUSE
sp
WE'RE
INVESTING
FOR
THAT
SALE
IN
THE
FIRST
HALF
IN
THE
FIRST
HALF
THEY'RE
INVESTING
IN
THE
FIRST
HALF
IN
sp
THAT
SECOND
HALF
sp
SO
sp
THE
CHANCES
ARE
IT
WILL
EXAGGERATE
sp
MORE
THAN
ANYTHING
ELSE
ER
AND
WE
HAVE
A
VERY
STRONG
COLLEGE
FRONT
LIST
ER
WHICH
WE
WOULD
HOPE
WOULD
ER
WOULD
MAKE
A
CONTRIBUTION
sp
AGAIN
sp
THIS
sp
YEAR
MORE
OF
A
CONTRIBUTION
ER
DAVID
{GAP_ANONYMIZATION_NAME}
RESIDENT
IN
AMERICA
WOULD
YOU
LIKE
TO
MAKE
ANY
GENERAL
COMMENTS
ON
THE
U
S
ON
THE
U
S
AS
sp
A
WHOLE
OR
ON
WELL
IN
RELATION
PERHAPS
TO
TO
ADDISON
WESLEY
WELL
I
THINK
THAT
THE
ERM
THE
AS
FRANK
sp
HAS
SAID
THEY
THEY
HAVE
A
STRONG
COLLEGE
sp
LIST
FOR
THIS
sp
YEAR
THE
SCHOOL
BUSINESS
SHOULD
sp
BE
sp
THEY
sp
CAN'T
REPEAT
THE
MATHS
sp
PROGRAMME
SUCCESS
OF
LAST
YEAR
ALTHOUGH
THERE
IS
FOLLOW
UP
BUSINESS
IN
OTHER
STATES
SO
THERE'S
STRONG
UNDERPINNINGS
sp
WITH
WHAT
THEY'VE
GOT
AND
THEY
ARE
IN
THE
RIGHT
sp
AREAS
OF
THE
MARKET
ERM
COULD
I
ASK
ER
A
LITTLE
ABOUT
ER
LONGMAN
AND
ER
AND
ER
PENGUIN
sp
IN
NINETEEN
NINETY
sp
TWO
sp
AND
sp
PARTICULARLY
IN
THE
CASE
OF
LONGMAN
sp
IS
sp
THE
MOMENTUM
OF
sp
PROFITS
IMPROVEMENT
IN
THE
SECOND
HALF
CARRYING
CARRYING
THROUGH
INTO
NINETEEN
NINETY
TWO
LONGMAN
AND
PENGUIN
IN
IN
NINETY
TWO
ER
WHAT
sp
WHAT
DO
WE
SAY
ABOUT
THAT
LONGMAN
HAVE
MADE
A
VERY
GOOD
START
TO
THE
YEAR
AND
ERM
AND
SO
THEY'VE
PROGRESSED
FROM
DAY
ONE
sp
MAKING
LAST
YEAR
I
EXPECT
TO
CONTINUE
ERM
AND
sp
PENGUIN
U
S
AGAIN
sp
HAVE
ER
MADE
A
GOOD
START
AND
THE
ONE
AREA
DAVID
{GAP_ANONYMIZATION_NAME}
CAN
TALK
ABOUT
THIS
BETTER
THAN
I
BUT
sp
THE
ONE
AREA
THAT
ER
WHERE
THERE
IS
AN
UPTURNING
IN
BUSINESS
ACTIVITY
AND
MO
PROMISE
{OOV}
HAVE
COME
INTO
THE
U
S
A
SO
YOU
KNOW
WE
EXPECT
ERM
PENGUIN
AND
A
W
ER
PENGUIN
U
S
sp
CERTAINLY
TO
GO
ON
AND
LONGMAN
TO
CARRY
ON
AS
THEY
ARE
IMPROVING
DAVID
DO
YOU
WANT
TO
SAY
ANYTHING
sp
ABOUT
THE
U
S
sp
NO
I
THINK
ERM
sp
IN
THE
CERTAINLY
IN
THE
CONSUMER
AREA
WHICH
AFFECTS
sp
BOTH
PENGUIN
AND
TO
SOME
EXTENT
ROYAL
DOULTON
THERE
ARE
DEFINITE
sp
SIGNS
sp
NOW
sp
OF
sp
THE
U
S
ECONOMY
TURNING
AROUND
AND
sp
THAT
IS
LIKELY
TO
CONTINUE
AS
AS
sp
THE
YEAR
GOES
ON
AND
CERTAINLY
TRADE
BOOK
PUBLISHING
DID
NOT
DO
AT
ALL
BADLY
IN
NINETEEN
NINETY
ONE
IN
A
RECESSIONARY
ENVIRONMENT
AND
ERM
THERE
ARE
AS
FRANK
HAS
MENTIONED
sp
PARTICULARLY
WITHIN
PENGUIN
sp
QUITE
A
LOT
OF
INTERNAL
RESTRUCTURING
HAS
sp
GONE
ON
AND
ONE
WOULD
HOPE
THAT
MARGINS
WOULD
IMPROVE
OVER
THE
NEXT
FEW
YEARS
AS
A
RESULT
OF
THAT
WHILE
WE'RE
ON
THE
U
S
COULD
YOU
SAY
ON
THE
OIL
SERVICES
ER
sp
HOW
MUCH
OF
THE
ER
GOOD
PERFORMANCES
DO
YOU
{OOV}
PUMPS
TURNING
ROUND
AND
AGAIN
WHAT
ARE
THE
PROSPECTS
OF
THAT
DIVISION
FOR
THE
CURRENT
sp
YEAR
WELL
ERM
CAN
sp
EVERYBODY
HEAR
THE
QUESTIONS
OR
IS
IT
BET
HELPFUL
TO
REPEAT
IT
IS
HELPFUL
TO
REPEAT
ER
{OOV}
TO
WHAT
EXTENT
ER
WAS
sp
THE
ER
WAS
THE
PERFORMANCE
OF
OF
CAMCO
ERM
ER
DEPENDENT
ON
A
GOOD
PERFORMANCE
FROM
{OOV}
WELL
I'D
LIKE
TO
QUALIFY
YOUR
QUESTION
sp
IF
I
MAY
PUT
WORDS
INTO
sp
YOUR
MOUTH
I
THINK
IN
FACT
{OOV}
ER
HAD
BEEN
DOING
QUITE
WELL
AND
THE
SPECIFIC
POINT
THAT
FRANK
WAS
REFERRING
TO
WAS
ERM
THE
TECHNOLOGY
TRANSFER
sp
THAT
THEY
DID
WITH
A
MAR
LARGE
CHIP
MANUFACTURER
WHICH
PROBABLY
MADE
A
CONTRIBUTION
IN
THE
SECOND
HALF
A
NET
CONTRIBUTION
OF
ABOUT
FIVE
MILLION
DOLLARS
AND
THAT
sp
OFFSET
SOME
sp
OF
THE
WEAKNESS
IN
IN
OTHER
PARTS
OF
CAMCO
'S
BUSINESS
IN
sp
THE
sp
LAST
QUARTER
OF
THE
YEAR
AND
THAT
sp
ER
TECHNOLOGY
TRANSFER
COVERS
sp
SUBMERSIBLE
PUMP
TECHNOLOGY
WHICH
WILL
BE
THE
STANDARD
sp
PUMP
LINE
AND
THE
CZECHS
sp
WILL
HAVE
A
NON
EXCLUSIVE
sp
ERM
LI
ER
LICENCE
TO
SELL
IT
IN
THE
SOVIET
UNION
WHICH
IS
A
PRIME
MARKET
ER
AND
IN
OTHER
AREAS
BEHIND
THE
OLD
IRON
sp
CURTAIN
AND
THAT'S
sp
AN
ARRANGEMENT
sp
WHICH
WILL
sp
BE
CARRYING
ON
OVER
THE
sp
NEXT
sp
FEW
sp
YEARS
COULD
YOU
TELL
US
PLEASE
HOW
MUCH
WE
SPENT
ON
GHOST
HOUSE
AND
RUNAWAY
TRAIN
sp
AND
WHAT
YOU
EXPECT
sp
IT
TO
BRING
IN
IN
REWARDS
THIS
YEAR
HOW
MUCH
sp
WE
SPENT
ON
GHOST
HOUSE
AND
RUNAWAY
TRAIN
ER
AND
HOW
MUCH
ER
PROFIT
sp
WE'LL
BRING
IN
THIS
YEAR
ER
MICHAEL
sp
{GAP_ANONYMIZATION_NAME}
THE
ERM
TOTAL
FIGURE
sp
WILL
END
UP
IT
ISN'T
ALL
COMPLETELY
sp
SPENT
sp
YET
BUT
IT'LL
END
UP
ER
SOMETHING
BETWEEN
EIGHT
AND
TEN
MILLION
POUNDS
IT'S
IMPOSSIBLE
sp
TO
sp
JUDGE
EXACTLY
HOW
MANY
PEOPLE
WILL
COME
IN
AS
A
RESULT
OF
THAT
AND
ER
HOW
MUCH
EXPENDITURE
WILL
sp
BE
INCURRED
sp
BECAUSE
AS
YOU
KNOW
WE'RE
IN
A
RECESSIONARY
PERIOD
AND
AS
YOU'VE
ALREADY
HEARD
THERE
IS
CONCERN
ABOUT
CURRENT
TRADING
BUT
I
WOULD
HOPE
THAT
IT
WOULD
BRING
IN
ER
SOMETHING
LIKE
sp
A
HUNDRED
sp
AND
sp
FIFTY
sp
THOUSAND
EXTRA
PEOPLE
CERTAINLY
IN
sp
A
GOOD
sp
YEAR
sp
I'D
EXPECT
sp
MORE
sp
THAN
THAT
sp
BUT
REALLY
THAT'S
ABOUT
AS
sp
MUCH
AS
I'M
PREPARED
TO
sp
SAY
WITH
SOME
ADDITIONAL
SPENDING
WHICH
WILL
sp
BE
sp
INCURRED
AT
ALTON
TOWERS
sp
BUT
OBVIOUSLY
IN
A
RECESSIONARY
PERIOD
WHICH
sp
WE
ARE
CERTAINLY
NOT
OUT
OF
YET
YOU
HAVE
TO
sp
REMEMBER
THAT
ALTON
TOWERS
HAS
A
PER
CAP
OF
SOMETHING
LIKE
FOURTEEN
POUNDS
A
HEAD
AT
THE
MOMENT
ER
AVERAGE
OF
ALL
sp
PEOPLE
AND
THEREFORE
sp
IN
A
RECESSIONARY
PERIOD
WHEN
PRESSURE
IS
ON
PEOPLE
sp
SPENDING
ER
sp
THAT
SORT
OF
FIGURE
IS
UNDER
sp
TREMENDOUS
sp
PRESSURE
ERM
A
COMMENT
ON
B
SKY
B
AND
{OOV}
CONTRIBUTION
I
MEAN
WILL
THERE
BE
ANY
CONTRIBUTION
BY
WAY
OF
{OOV}
LOAN
GUARANTEES
OVER
sp
THE
FORECAST
sp
OVER
THE
NEXT
TWO
FORECAST
YEARS
OR
I
sp
MEAN
MY
sp
UNDERSTANDING
sp
WAS
THAT
THERE
WAS
A
GUARANTEE
FEE
sp
THAT
THAT
ERM
WAS
STILL
OWED
THIS
YEAR
B
SKY
B
AND
ITS
sp
CONTRIBUTION
ERM
TO
PEARSON
FRANK
WELL
I
MEAN
WE
DON'T
WE
DON'T
sp
INTEND
sp
TO
sp
EQUITY
ACCOUNT
sp
B
sp
SKY
B
FOR
THE
PRESENT
TIME
ANYWAY
ER
OBVIOUSLY
sp
THE
GUARANTEE
sp
FEES
ARE
A
CONTRACTUAL
OBLIGATION
OF
B
sp
SKY
B
AND
ER
sp
SO
WE
ER
WE
PEARSON
ARE
ENTITLED
TO
THOSE
AND
I
MEAN
OBVIOUSLY
AS
AS
B
SKY
B
BECOMES
sp
CASH
sp
GENERATIVE
AND
sp
ERM
sp
THEN
CASH
WILL
FLOW
INTO
PEARSON
AND
I
TH
YOU
KNOW
THE
SCHEDULE
ERM
AND
IN
sp
THAT
sp
IN
sp
THAT
WAY
JAMES
WOULD
YOU
JAMES
JUST
SAID
THAT
WE
HAVEN'T
TAKEN
ANY
GUARANTEE
sp
FEES
sp
INTO
THIS
YEAR'S
PROFIT
ER
NOR
ANY
INTEREST
ON
sp
ON
LOAN
STOCKS
THAT'S
sp
SOMETHING
sp
THAT
sp
WE
sp
OBVIOUSLY
WOULD
CONSIDER
NEXT
sp
THIS
TIME
NEXT
sp
YEAR
IN
sp
THE
LIGHT
OF
OF
THE
PERFORMANCE
sp
AND
PROSPECTS
sp
AND
CLEARLY
ON
ADVICE
FROM
FROM
THOSE
ON
THE
BOARD
BUT
BUT
AS
sp
THE
sp
BUSINESS
CONTINUES
sp
TO
DO
DO
BETTER
AS
THEY'RE
ALREADY
DOING
RATHER
WELL
ER
THAT
sp
BECOMES
AN
ISSUE
TWO
sp
COMPLETELY
DIFFERENT
sp
QUESTIONS
sp
CAN
sp
YOU
JUST
TELL
US
WHAT
YOU'VE
DONE
sp
TO
YOUR
ENTRANCE
PRICING
FOR
YOUR
VARIOUS
ENTERTAINMENT
CENTRES
sp
AND
ALSO
CAN
YOU
TELL
US
sp
WHY
sp
THE
CANADIAN
PROFIT
'S
ALMOST
sp
DOUBLED
IN
THE
YEAR
I
COULDN'T
sp
HEAR
sp
THE
SECOND
QUESTION
MYSELF
YOUR
ERM
ON
YOUR
ALLOCATION
OF
GEOGRAPHICAL
PROFITS
ER
CANADA'S
PROFITS
HAVE
ALMOST
DOUBLED
IN
THE
YEAR
TWO
TOTALLY
SEPARATE
sp
QUESTIONS
THE
FIRST
RELATING
sp
TO
ENTRANCE
PRICING
AT
OUR
ENTERTAINMENT
BUSINESSES
AND
WE'LL
DEAL
WITH
THAT
sp
FIRST
MICHAEL
sp
THE
ERM
ENTRANCE
PRICE
INCREASES
sp
GENERALLY
sp
HAVE
BEEN
IN
LINE
sp
OR
SLIGHTLY
ABOVE
INFLATION
WE
NORMALLY
AIM
AND
HAVE
ACHIEVED
VERY
SUCCESSFULLY
IN
RECENT
YEARS
REAL
PRICE
INCREASES
ABOVE
INFLATION
LAST
YEAR
YOU'LL
REMEMBER
WE
HAD
TO
ABSORB
IN
FACT
sp
IN
THE
TUSSAUDS
GROUP
ABOUT
THREE
QUARTERS
OF
A
MILLION
sp
ER
POUNDS
ON
THE
INCREASE
IN
V
A
T
AND
THAT
sp
WAS
sp
A
BLOW
TO
US
AT
THE
sp
BEGINNING
OF
THE
SEASON
YOU
REMEMBER
IT
WAS
sp
THE
BUDGET
MORE
OR
LESS
THIS
TIME
LAST
YEAR
ER
THIS
YEAR
HOPEFULLY
ER
WITH
PRESSURE
AGAIN
AS
I
SAID
EARLIER
BUT
NEVERTHELESS
WE
sp
ARE
HOPING
sp
AND
sp
HAVING
sp
ER
PUT
IN
OUR
sp
NEW
PRICE
INCREASES
FOR
THE
SEASON
WHICH
sp
IS
MORE
OR
LESS
BEGINNING
NOW
I
HOPE
EVERYBODY
UNDERSTANDS
sp
ER
sp
ALTON
sp
TOWERS
sp
IS
sp
LAUNCHING
sp
ITS
NEW
sp
THINGS
sp
TODAY
CHESSINGTON
sp
OPENED
sp
THIS
sp
WEEKEND
sp
SO
WE
HAVEN'T
BEEN
TRADING
sp
UNTIL
THIS
WEEKEND
IN
EFFECT
IN
sp
OUR
PARKS
sp
BUSINESS
LONDON
OF
COURSE
AND
OUR
AMSTERDAM
sp
EXHIBITION
HAS
BEEN
TRADING
SINCE
THE
BEGINNING
OF
THE
YEAR
AND
THE
PRICE
INCREASE
IS
GENERALLY
COMING
AT
THE
BEGINNING
sp
OF
THE
SEASON
WHICH
sp
IS
MORE
OR
LESS
NOW
FOR
sp
THE
sp
PARKS
sp
EARLIER
FOR
THE
EXHIBITIONS
AND
THE
SEPARATE
QUESTION
RELATED
sp
TO
TRADING
PROFITS
ERM
IN
CANADA
WHY
HAVE
sp
THEY
GONE
FROM
EIGHT
MILLION
TO
FIFTEEN
sp
MILLION
ER
JAMES
THE
ER
COMBINATION
sp
OF
THINGS
FIRST
OF
ALL
DURING
THE
COURSE
OF
THE
YEAR
OUR
sp
HOLDING
IN
sp
THE
sp
CANADIAN
FINANCIAL
POST
REDUCED
sp
THEREFORE
WE
TOOK
IN
LESS
LOSSES
sp
FROM
THAT
BUSINESS
SECONDLY
sp
PENGUIN
CANADA
RETURNED
THE
PROFITS
THIRDLY
BOTH
CAMCO
AND
ADDISON
WESLEY
sp
HAD
VERY
sp
GOOD
sp
YEARS
IN
sp
THAT
sp
TERRITORY
FURTHER
sp
QUESTIONS
sp
SORRY
CAN
sp
I
ASK
ANOTHER
ONE
ER
ON
YOUR
ERM
WEST
THURROCK
ER
RECEIPT
AND
sp
PROFITS
I
THINK
sp
THIS
sp
IS
THE
LAST
sp
ER
THE
LAST
sp
YEAR
sp
ERM
CAN
YOU
GIVE
US
AN
INDICATION
OF
ER
THOUGHT
sp
THAT
sp
YOU
sp
MIGHT
sp
HAVE
sp
OF
sp
FILLING
sp
THE
sp
HOLE
sp
ER
IN
NINETEEN
sp
NINETY
sp
THREE
WHEN
YOU
CEASE
TO
{OOV}
ER
THE
MAJOR
CONTRIBUTION
sp
FROM
sp
ONE
sp
TRANSACTION
sp
IN
RELATION
TO
WEST
sp
THURROCK
ER
WHICH
WILL
BE
COMING
TO
AN
END
ER
JAMES
WOULD
YOU
LIKE
TO
sp
COMMENT
ON
THAT
WELL
YOU'RE
ABSOLUTELY
RIGHT
ERIC
IT
DOES
COME
TO
AN
END
ER
TO
WHAT
EXTENT
THE
RIFT
ER
FILLED
I
DON'T
THINK
IT
CAN
BE
WHOLLY
FILLED
AS
A
FUNCTION
OF
THE
sp
RECOVERY
IN
ER
THE
MARKET
FOR
LAND
YOU
KNOW
WE
HAVE
A
CONSIDERABLE
HOLDING
OF
ER
LAND
IMMEDIATELY
sp
ADJACENT
TO
THE
REASONABLE
SHOPPING
CENTRE
THERE
AND
ERM
IF
AND
WHEN
THINGS
BECOME
BUOYANT
AGAIN
AND
I
WENT
sp
DOWN
THERE
A
COUPLE
OF
WEEKS
AND
I
WAS
RATHER
IMPRESSED
BY
BY
THE
LOOK
OF
THE
AREA
THEN
CLEARLY
LAND
PRICES
GO
UP
AND
WE
HAVE
sp
THE
CAPACITY
TO
TO
GENERATE
MORE
PROFIT
BUT
I
THINK
IT
WOULD
BE
ILLUSORY
TO
THINK
sp
THAT
sp
WE
sp
CAN
MAINTAIN
OUR
PROFITS
FROM
LAND
IN
NINETY
THREE
AT
THE
SAME
LEVEL
AS
IT
sp
HAD
sp
BEEN
sp
FOR
sp
NINETY
ONE
AND
sp
TWO
sp
THAT
WAS
sp
THE
sp
FINAL
sp
QUESTION
sp
WELL
YES
sp
WE
HAVE
A
sp
FINAL
QUESTION
TONY
{GAP_ANONYMIZATION_NAME}
sp
FROM
{OOV}
YOU
SAY
sp
IF
IF
sp
ALL
sp
YOUR
sp
LOANS
sp
TO
sp
B
SKY
B
WERE
sp
PERFORMING
AND
sp
YOU
CONSOLIDATED
THEM
ERM
WHAT
sp
YOUR
INCOME
WOULD
sp
BE
IF
WE
CONSOLIDATED
IF
YOU
IF
ALL
YOUR
LOANS
TO
sp
B
sp
SKY
B
WERE
PERFORMING
AND
YOU
TOOK
CREDIT
FOR
THEM
sp
WHAT
sp
WHAT
WOULD
THE
CONTRIBUTION
BE
AH
ER
JAMES
YOU
MEAN
IF
WE
TOOK
sp
THE
INTEREST
FROM
GUARANTEE
FEES
YEAH
{OOV}
sp
YOU
GOT
AN
ANSWER
FOR
THAT
A
USEFUL
FEW
MILLION
sp
AN
EXCITING
SHOT
IT'S
LIKE
ALL
GOOD
THINGS
TO
COME
sp
I
sp
DON'T
LIKE
TO
COUNT
MY
sp
CHICKENS
SO
I'D
sp
RATHER
sp
NOT
sp
NOT
sp
THE
LITTLE
sp
MEMORANDUMS
SAY
OH
YOU'VE
GOT
ANOTHER
X
MILLION
IF
ONLY
WE
COULD
TAKE
sp
THEM
IN
THIS
YEAR
ANY
OF
MY
COLLEAGUES
HAVE
A
NUMBER
IN
THEIR
MIND
{OOV}
FIFTEEN
THANKS
CHARLES
ER
WE
HAVE
ANOTHER
QUESTION
WHAT
CRITERIA
I
MEAN
WILL
YOU
USE
TO
DETERMINE
WHETHER
OR
NOT
YOU
ACTUALLY
ERM
TAKE
THOSE
INTO
ACCOUNT
IN
DETERMINING
NINETEEN
NINETY
TWO'S
FIGURES
WHETHER
AND
WHEN
sp
THEY'RE
GON
NA
BE
PAID
STRING
THAT
TO
WHETHER
JAMES
WHEN
JAMES
NOT
WHETHER
WELL
I
REGARD
THE
ANSWER
TO
WHETHER
AS
ACADEMIC
SO
ON
HAPPY
ON
THAT
HAPPY
NOTE
COULD
WE
GO
NEXT
DOOR
AND
HAVE
SOME
COFFEE
sp