Performance 2005

Sales:05 £629M / $1,082M;04 £587M / $1,010M;03 £588M / $1,011M;Adjusted operating profit:05 £101M / $174M;04 £71M / $122M;03 £41M / $71M;

Profits up by £17m on £14m sales improvement

Advertising growth continues and Financial Times returns to profit

FT newspaper sales up 6% to £221m; £14m profit improvement to £2m.
FT advertising revenues up 9% (and up 18% in the fourth quarter), improving through the year. Sustained growth in luxury goods and worldwide display advertising. FT.com advertising revenues up 27% as FT's biggest advertisers shift to integrated print and online campaigns.
More than 90% of advertising revenue improvement converted to profit in 2005.
FT's average worldwide circulation 2% lower for the year at 426,453 but 1% higher in the second half at 430,635. FT.com's paying subscribers up 12% to 84,000 and average monthly audience up 7% to 3.2 million.

Sustained progress at network of business newspapers

Sales broadly level and profits £3m higher at the FT Group's other business newspapers and magazines.
Les Echos advertising revenues and circulation level with 2004 (average circulation of 119,000) despite tough trading conditions.
FT Business improves margins and profits with good growth in international finance titles.
FT Deutschland reduces losses further despite a weak advertising market in Germany, and increases average circulation by 6% to 102,000.
The Economist, in which Pearson owns a 50% stake, increases its circulation by 10% to 1,038,519 (for the January - June ABC period).

Strong organic growth and operating improvements

FT Interactive Data, IDC's largest business (approximately two-thirds of IDC revenues), generates strong growth in North America and returns to growth in Europe.
Modest growth at Comstock, IDC's real-time datafeed business for global financial institutions, and at CMS BondEdge, its fixed income analytics business.
Renewal rates for IDC's institutional businesses remain at around 95%.
eSignal, IDC's active trader services business, increases headline sales by 27% with continued growth of subscriber base and full-year contribution from FutureSource, acquired in September 2004.
Continued progress in transition to two new consolidated data centres, enabling IDC's four major businesses increasingly to feed off one centralised data and technology infrastructure.

Continued expansion into adjacent markets

Acquisition of IS.Teledata for $51m (net of cash acquired) in December 2005 adds web-based financial data applications and further expands IDC's presence in continental Europe.
Agreement to acquire Quote.com and related assets for $30m in February 2006 which will broaden IDC's range of online services for active traders and financial professionals, and create a new revenue stream in online financial advertising.