GlobalData Regulatory News (DATA)

7 Dec 2006 07:00

Date: 07 December 2006

On behalf of: TMN Group plc ("TMN" or "the Company")

TMN Group plc

* Interim Results

The Board of TMN Group plc (AIM: TMN), the UK's premier online direct marketing group, is pleased to announce its interim results for the six months ended 31 October 2006. The highlights are:

Financial

* Revenue up 350% to ‚£8.0m (2005: ‚£1.8m) * Operating Profit up 190% to ‚£1.4m (2005: ‚£0.5m) * Headline earnings per share up 185% to 2.4p (2005: 0.8p)

Operational

* Acquisitions of EDR and ID Factor now fully integrated * Key client wins for EDR, in finance, automotive and retail sectors * 41 supply partnership gains across the globe for ID Factor * New technology and product launches, including new lead generation system www.plum-offers.com * Change of company name from themutual.net to TMN Group plc, to better reflect the divisional structure of the group

Commenting on the results, Mark Smith, CEO said:

"Both the ongoing growth of the internet advertising market and the increased usage by consumers of the internet are key drivers in our continuing success."

"We have experienced solid growth all round, very much in line with our expectations, while we are equally delighted with the progress of our new products, notably our lead generation technology, "Lead It", seen via www.plum-offers.com."

"With further launches on the horizon along with continued strong growth forour core divisions, we remain extremely upbeat about the prospects for the fullyear."- ends -Enquiries to:TMN Mark Smith, CEO 020 7440 9310 Peter Coveney, CFO Redleaf Communications Emma Kane / Duncan McCormick / Samantha Robbins 020 7822 0200

Notes to Editors:

* Themutual.net ("TMN") was established in 1999. * The Company comprises of three core divisions: * TMN Media: email marketing specialist, with over 10 million highly profiled, permission-based email addresses across over 32 lists, manages the most comprehensive portfolio of email databases in the UK. Also operator of the largest online reward scheme in the UK. Clients include Sky, T-Mobile, British Gas, EMAP, Volvo and Boots. * EDR: online interactive advertising agency, plans campaigns across dozens of third party lists, including those operated by TMN Media, and is the largest buyer of email advertising in the UK. Clients span a number of sectors, including finance, motoring, publishing and shopping. * The iD Factor: specialists in online market research, with 250,000 panel members in the UK and over 4 million members across 41 territories, managed via a network of local partnerships, allowing targeted domestic and international research. Clients include numerous MR Agencies, producing work for Microsoft, Lloyds TSB, NSPCC, Persil, Carlsberg and PC World. * TMN is committed to the development of new initiatives to drive the growth of its business. * TMN Enterprise has been created to manage all new developments for the Group. The first development, launched in September, is a web-based lead generation system called "Lead It", designed to assist advertisers in building their databases. * ICD Research has been established as an autonomous division providing clients with insight and analysis of market research data. * Operating in rapidly growing market * Over ‚£1.4 billion spent on internet advertising in 2005 - ‚£917.2m spent during H1 2006, a 40.3% increase on a like-for-like basis compared with H1 2005 (Source: IAB) * Online advertising now represents over 10% of the total advertising market - and is the fastest-growing segment of the market (Source: IAB) * Online Retail spend predicted to reach ‚£40 billion by 2010 (Source: Forrester Research) * Focus on dominating UK market in key areas of online advertising and market research * Members of the Direct Marketing Association (DMA) and International Advertising Bureau (IAB)

DIRECTORS

Warren Tayler (Non-Executive Chairman)

Mark Smith (Chief Executive Officer)

Peter Coveney (Financial Director)

Jeremy Middleton (Non-Executive Director)

Vince Smith (Non-Executive Director)

Harold Gittelmon (Non-Executive Director)

ADVISORS

Secretary and Registered Office

Peter Coveney FCA, 2nd Floor, 69-73 Theobalds Road, London, WC1X 8TA.

Auditors

Menzies, Chartered Accountants, Neville House, 55 Eden Street, Kingston upon Thames,

Surrey KT1 1BW.Principal Bankers

Barclays Bank plc, London Corporate Banking, 50 Pall Mall, London, SW1 1QB.

Solicitors

Field Fisher Waterhouse, 35 Vine Street, London EC3N 2AA.

Nominated Advisor and Broker

Investec Bank (UK) Ltd, 2 Gresham Street, London, EC2V 7QP

cHAIRMAN'S STATEMENT

I am once again delighted to announce that the Group results for the first 6 months of the financial year show exceptional growth in revenue and profitability. This follows on from the strong results of the last six months of our last trading year.

* Record revenue and profit levels of ‚£8m and ‚£1.4m respectively. * Growth in all areas of the business - TMN Media showing an underlying YOY growth of 38%, while EDR grew at 70% and ID Factor at 122%. * Margins have increased in a competitive marketplace. * TMN Media now has 10 million email addresses across 36 different databases, offering both response and branded advertising opportunities to clients. * EDR, our planning and buying email advertising agency, has won a number of key clients in finance, automotive and retail, and is launching innovative technologies to win new and assist existing clients and increase further the barrier to entry. * ID Factor has gained 41 supply partnerships across the globe, along with expanding its internal panels to help service a global range of clients. * New technology and product launches, including our new lead generation system (www.plum-offers.com). * Two new divisions - ICD Research, which acts as an Insight division for both the internal divisions and clients, plus TMN Enterprise which is focused on launching new technology and products.

Your Group is now one of the largest online direct marketing companies in the UK. The opportunities that this brings, along with new services and initiatives, has created an exciting Company with tremendous potential in a rapidly growing market place. Divisionally, we are well placed.

* TMN Media (www.tmnmedia.com) services over 30 different lists, including those from EMAP, Handbag and thetrainline as well as its own expanding databases including MutualPoints. * EDR (www.edragency.com) is extremely well positioned, with recent growth in revenue and clients along with the introduction of new planning and buying technology. * The ID Factor (www.theidfactor.com) is now able to offer sample provision for online market research in 41 territories through strategic partnerships, and has experienced strong growth in a market which is expected to double further in the next 12 to 18 months.

Highlights and comparative figures are shown below:

INCOME STATEMENT 6 months 6 months Year to to ended 31/10/06 31/10/05 30/04/06 ‚£'000 ‚£'000 ‚£'000 Revenue 7,981 1,761 9,012 Gross profit 4,284 1,537 5,072 Gross profit % 53.7% 87.3% 56.3% Operating profit 1,373 464 1,689 Earnings per share - Basic 2.4p 1.6p 3.5p Earnings per share - Diluted 2.3p 1.5p 3.2p BALANCE SHEET 31/10/06 31/10/05 30/04/06 ‚£'000 ‚£'000 ‚£'000 Cash and cash equivalents 1,070 2,563 1,221 Total Equity 7,601 2,741 5,809

The Divisional financial highlights, with comparative figures adjusted to include the results of EDR and IDF prior to acquisition, are:

Divisional Income Statement 6 months 6 months Growth to to 31/10/06 31/10/05 ‚£'000 ‚£'000 TMN Media Turnover 4,238 3,079 +38% Gross profit 2,849 1,999 Gross profit % 67.2% 64.9% EDR Agency Turnover 2,867 1,681 +70% Gross profit 858 507 Gross profit % 29.9% 30.1% ID Factor Turnover 876 395 +122% Gross profit 577 240 Gross profit % 65.9% 60.8%

The Group, with the acquisitions in 2005 of EDR and ID Factor now fully integrated, performed in a number of areas:

The market place in which we operate is expected to continue growing annually at between 30 and 40%. As the Divisional Income statement shows, we have exceeded these growth rates...

We feel that the current growth in internet advertising is sustainable for the foreseeable future, with demand for response media increasing and the more traditional branded advertising migrating online over the next few years. Recent research from the IAB shows that more users are spending more time online, and we feel that, by presenting advertisers with high quality products and services, as well as operating a manageable and sensible structure, the Group is well prepared for further growth.

Moving forward, TMN Group is in a strong position to capitalise on its recent growth. We have set up an innovations division, TMN Enterprise, to focus on generating new products and services. Recent developments include lead generation technology "Lead It", with www.plum-offers.com being our consumer facing competition portal utilising this technology. Users are encouraged to sign up to various offers from our advertisers, with the key difference between this and other portals being that they are asked to interact with the advertiser, helping to increase the awareness of the offer as well as the quality of the data. We feel this can contribute significantly in the future. Further technology, including a focus on leveraging our proprietary email delivery software and increasing developments across existing products, will allow us to both increase revenue streams and garner further success in the remaining six months of the year and beyond.

We have also launched our own Insight division, ICD Research ( www.icd-research.com). This acts both as a value-added offering for internal use as well as offering market analysis to existing and new advertisers.

As announced on 8th September we were very pleased to renegotiate the deferred consideration payable on the acquisition of ID Factor Limited. As a result and following the issue of 1.55m new shares our deferred cash liability has fallen by over ‚£1.0m to ‚£0.5m and our deferred share liability by over ‚£1.5m to ‚£1.2m.

The growth of the first six months is in line with management expectations and we have continued to expand our management and staff in order to help meet our goals. As a larger Group, we are able to match opportunity with resource, which is a continuing and realisable demand on our management. The Company has, for the last four years, achieved continued growth and profitability by investing in management and infrastructure and will continue to do so in order to achieve the revenue and profit goals set out by the board.

Following the AGM the company has changed its name to TMN Group plc to better reflect the divisional structure of the Group.

Your Company's management and staff are all excited by the prospects ahead of us and their hard work and ability to rise to the challenges of fast growth contribute hugely to our success.

Warren TaylerChairmanCONSOLIDATED INCOME STATEMENT

FOR THE SIX MONTHS ENDED 31 October 2006

6 months 6 months Year ended ended ended 31 October 31 October 30 April 2006 2005 2006 Note ‚£'000 ‚£'000 ‚£'000 Revenue 7,981 1,761 9,012 Cost of sales (3,697) (224) (3,940) Gross profit 4,284 1,537 5,072 Administrative expenses (2,911) (1,073) (3,383) Operating profit 1,373 464 1,689 Profit on disposal of - 440 440 available-for-sale investments Interest on bank deposits 4 37 55

Interest payable and similar charges - - (2)

Profit on ordinary activities before 1,377 941 2,182 tax

Tax 2 (210) (306) (657)

Profit on ordinary activities after tax 1,167 635 1,525

Earnings per share 3 Basic (pence) 2.4p 1.6p 3.5p Diluted (pence) 2.3p 1.5p 3.2p

All amounts relate to continuing operations. There are no recognised gains or losses other then those within the profit and loss account.

CONSOLIDATED BALANCE SHEETAT 31 OCTOBER 2006 31 31 30 October October April 2006 2005 2006 Note ‚£'000 ‚£'000 ‚£'000 Non-current assets Goodwill 4 7,483 - 9,093 Other intangible assets 369 408 383 Property, plant and equipment 154 57 97 8,006 465 9,573 Current assets Trade and other receivables 4,184 975 3,342 Cash and cash equivalents 1,070 2,563 1,221 5,254 3,538 4,563 Total assets 13,260 4,003 14,136 Current liabilities Trade and other payables 2,880 356 2,804 Current tax liabilities 469 595 534 Provisions 5 1,188 311 639 4,537 1,262 3,977 Non-current liabilities Provisions 6 1,122 - 4,350 Total liabilities 5,659 1,262 8,327 Net assets 7,601 2,741 5,809 EQUITY Called up share capital 105 104 105 Share premium account 5,809 2,331 4,702 Share option reserve 55 34 41 Other reserves 120 120 120 Retained earnings 1,512 152 841 Total equity 7 7,601 2,741 5,809

These financial statements were approved by the Board of Directors on 6th December 2006.

Signed on behalf of the BoardPeter CoveneyDirector

CONSOLIDATED CASH FLOW STATEMENT

FOR THE SIX MONTHS ENDED 31 OCTOBER 2006

6 months 6 months Year ended ended ended 31 October 31 October 30 April 2006 2005 2006 ‚£'000 ‚£'000 ‚£'000 Cash flows from operating activities Operating profit 1,373 464 1,689 Depreciation 47 26 73 Amortisation - database 191 281 505 Share based payments expense 14 6 14 Increase/ (decrease) in receivables (842) (215) (967) (Decrease)/ increase in payables 76 102 569 (Decrease)/ increase in provisions 92 (7) 69 Cash generated from operations 951 657 1,952 Interest paid - - (2) Tax paid (275) - (512) Net cash generated from operating 676 657 1,438activities Cash flows from Investing activities Interest received 4 37 54 Proceeds on disposal of - 561 561available-for-sale investments Purchases of plant, property and (103) (14) (51) equipment Purchases of other intangibles - (177) (233) (431) database Acquisition of subsidiaries 1,610 - (8,680) Net cash (used in) / from investing 1,334 351 (8,547) activities Financing activities Proceeds on issue of shares 1,107 - 2,372 Purchase of own shares (496) - (199) Net inflow / (outflow) from other (2,772) - 4,602 creditors Net cash from /(used in) financing (2,161) - 6,775 activities Net increase / (decrease) in cash and (151) 1,008 (334) cash equivalents Cash and cash equivalents at the 1,221 1,555 1,555beginning of the period Cash and cash equivalents at the end of 1,070 2,563 1,221the period

NOTES TO THE FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 OCTOBER 2006

1. Basis of preparation

For the year ending 30 April 2007, the Group will prepare consolidated financial statements under International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB). This interim report for the 6 months ended 31 October 2006, is the first interim report under IFRS and has been prepared on the basis of the accounting policies set out in the financial statements for the year ended 30 April 2006, amended where necessary to comply with IFRS.

The financial information has not been audited and does not constitute full financial statements within the meaning of Section 240 of the Companies Act 1985.

The financial information relating to year ended 30 April 2006 is based on the Group's statutory accounts for that period, restated for IFRS. Those statutory accounts which were prepared in accordance with United Kingdom Generally Accepted Accounting Principles (UK GAAP) received an unqualified audit report and have been filed with the Registrar of Companies.

The financial results of the Group previously published for the year ended 30 April 2006 and for the six months ended 31 October 2005 were prepared under UK GAAP. These results have been restated in accordance with IFRS. The effect of this restatement is set out below:

6 months Year ended ended 31 October 30 April 2005 2006 ‚£'000 ‚£'000 Profit after tax under UK GAAP 641 1,539 IFRS adjustments: Share based payments (6) (14) Profit after tax under IFRS 635 1,525 2. Tax The tax expense comprises: 6 months 6 months Year ended ended ended 31 31 30 October October April 2006 2005 2006 ‚£'000 ‚£'000 ‚£'000 Current tax UK corporation tax 427 306 661 Adjustment in respect of prior years (32) - - Tax relief on share options (185) - - 210 306 661 Deferred tax Decrease in deferred tax liability - - (4) Total tax expense 210 306 657

NOTES TO THE FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 OCTOBER 2006

3. Earnings per share

The calculation of earnings per share is based on the following profits andnumber of shares: 6 months ended 6 months ended Year ended 31 October 2006 31 October 2005 30 April 2006 Profit Number Pence Profit Number Pence Profit Number Pence of per of per of per ‚£'000 shares share ‚£'000 shares share ‚£'000 shares share `000 `000 `000 Headline earnings 1,167 49,326 2.4 327 40,267 0.8 1,217 43,936 2.7per share* Reconciliation to - - - - - - - - -reported earnings (net of tax at 30%): -profit on - - - 308 - 0.8 308 - 0.8available-for-sale investments Basic earnings per 1,167 49,326 2.4 635 40,267 1.6 1,525 43,936 3.5share Dilutive effect of securities: Share options - 1,832 - - 2,876 - - 3,136 - Deferred - 450 - - - - - - -consideration to be settled in shares Diluted earnings 1,167 51,608 2.3 635 43,143 1.5 1,525 47,072 3.2per share

*Headline earnings per share excluding profit on available-for-sale investments relating to the prior year have been included as the Directors consider that this figure provides a meaningful measure of the ongoing business.

4. Goodwill 31 October 31 October 30 April 2006 2005 2006 ‚£'000 ‚£'000 ‚£'000 At the beginning of the period 9,093 - - Acquisitions - - 9,093 Reduction (1,610) - - At the end of the period 7,483 - 9,093

Reduction in goodwill arises from the renegotiation of the ID Factor Limited deferred consideration.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 OCTOBER 2006

5. Current liabilities: Provisions

31 October 31 October 30 April 2006 2005 2006 ‚£'000 ‚£'000 ‚£'000 Deferred cash consideration 200 - 193 Deferred share consideration 509 - 59

Other provisions (rewards liability) 479 311 387

1,188 311 639

The deferred share consideration is shown as a liability but will be settled by the issue of ordinary shares.

6. Non-current liabilities: Provisions

31 October 30 April 31 October 2006 2005 2006 ‚£'000 ‚£'000 ‚£'000

Deferred cash and loan note consideration 300 - 1,533

Deferred share consideration 722 - 2,717 Unsecured 2% loan notes 100 - 100 1,122 - 4,350

The deferred share consideration is shown as a liability but will be settled by the issue of ordinary shares.

7. Reconciliation of movement in total equity

Called Up Share Share share premium Option Other Retained capital account reserve reserve earnings ‚£'000 ‚£'000 ‚£'000 ‚£'000 ‚£'000 ‚£'000 At 1 May 2006 105 4,702 41 120 841 5,809 Issue of shares - 1,107 - - - 1,107 Share buyback - - - - (496) (496) Share options movement - - 14 - - 14 Total income recognised - - - - 1,167 1,167 for the period At 31 October 2006 105 5,809 55 120 1,512 7,601 8. Dividend

The company does not intend to pay a dividend at this time.