DMGT.L Regulatory News (DMGT)

29 September 2016

Daily Mail and General Trust plc ('DMGT')

Pre-Close Trading Update

Ahead of the year end on 30 September 2016, this statement provides an update on the Group's progress in the current year. It covers the eleven month period to the end of August 2016 and includes comments on September where practicable.

Group outlook for 2016 remains in line with current market expectations~

· Stable Group underlying# revenue performance; reported revenue growth of 4%

· Solid revenue growth from B2B businesses, up 2% underlying#

· dmg media underlying# revenue decline of 2% with weak UK print advertising market, partly offset by digital advertising growth and robust circulation revenue

· Continued active portfolio management; Euromoney acquired FastMarkets in Q4

· Net debt to EBITDA ratio expected to be below 2.0 at year end

· Full Year results expected to be in line with current market expectations~

· Appointment of Paul Zwillenberg, Chief Executive on 1 June 2016 and resignation of Stephen Daintith, CFO announced on 22 September 2016

· Reorganisation initiatives being implemented with exceptional operating charge for FY 2016 of c.£50 million

Business to Business (B2B)

Reported revenues benefited from the weaker British pound relative to the US dollar.

· Risk Management Solutions (RMS): year to date revenues grew by an underlying# 1%, despite the continuing adverse impact of some client consolidation. The RMS(one) suite of solutions remains on track to be released in stages to RMS's client base. The first application to run on the RMS(one) platform, Exposure Manager, was released successfully in July. It is now being licensed and used by a large client while several existing clients are in the final evaluation stage. In August 2016, as expected, capitalisation of development costs associated with the RMS(one) product ceased and amortisation of the RMS(one) asset commenced.

· dmg information: revenues grew by an underlying# 6%. Genscape, the energy business, continued to deliver double-digit underlying# growth and Hobsons, the education business, improved its performance in the five months of the second half to double-digit underlying# growth for the eleven months. The property information portfolio, which includes Landmark and SearchFlow in the UK, and EDR, Trepp, Xceligent, Buildfax and SiteCompli in the US, delivered low-single digit underlying# growth. Low commercial and residential property transaction volumes have adversely impacted the performance of SearchFlow, Landmark and EDR, especially in the second half to date. Full year reported revenue growth, which includes the benefit of acquisitions and the stronger US dollar, is expected to be in line with market expectations~.

· dmg events: revenues grew by an underlying# 2%, reflecting the expected adverse impact of the weak Canadian energy market on this year's Global Petroleum Show. The stronger reported revenue growth of 13% includes the benefits of the occurrence of the Gastech event, which previously took place in March 2014, and the stronger US dollar. This was partly offset by the absence of the digital marketing events, which were disposed of in September 2015.

· Euromoney Institutional Investor: released its pre-close trading update earlier today although does not report its performance for the eleven months to August. Trading since the Q3 update on 21 July has continued in line with expectations, with Euromoney continuing to face challenging conditions given volatile financial markets. The underlying growth in subscription revenues is expected to accelerate to 2% in the final quarter, with underlying advertising revenue declines consistent with long-term trends. Revenues from commodity events and training, however, have deteriorated. Full year revenues are expected to decline by an underlying 4%, in line with the nine months to June, although reported revenues for the full year are expected to decrease by 1%, including the benefit of the stronger US dollar.

dmg media

· dmg media: year to date underlying# revenues declined by 2%. Circulation revenues were down 2% due to declining volumes, although benefited from the implementation of cover price increases of the Monday to Friday editions of the Daily Mail, in February 2016, and The Mail on Sunday, in July 2016. Both the Daily Mail and The Mail on Sunday continue to hold significant market share of 23.1% and 22.0% respectively*. The disposal of Wowcher, which occurred in November 2015, had an adverse revenue impact with dmg media's total reported revenues declining by 5% in the eleven month period.

Total year to date underlying# advertising revenues across dmg media were down by an underlying# 4%, with a 12% decline in print advertising being partly offset by 17% growth in digital advertising. For the five weeks since 21 August 2016, total advertising revenues for the business have decreased by an underlying# 10%. As previously indicated, the reported full year results will benefit from the inclusion of 53 weeks of trading, compared to 52 weeks in FY 2015.

· Mail businesses: MailOnline's advertising revenues in the eleven months increased by an underlying# £13 million (18%), partly offsetting a decline of £20 million (13%) at the Daily Mail and the Mail on Sunday. Underlying# advertising revenues across the Mail businesses as a whole, for print and digital combined, were consequently down by 3%.

· MailOnline: year to date underlying# digital advertising growth of 18% reflected continued encouraging growth in both the UK and the US. MailOnline's global monthly unique browsers in August 2016 stood at 248 million, up 30 million or 14% on last year, and average global daily unique browsers were 15.3 million, an increase of 11% on last year.

Active Portfolio Management

Since the third quarter Trading Update in July, additional M&A activity has included Euromoney's acquisition of FastMarkets for £13 million. The acquisition will extend Metal Bulletin's capabilities into real-time data delivery and will be an integral part of Euromoney's extensive portfolio of digital products.

As part of our initiative to create a greater focus in the DMGT portfolio, we are conducting a strategic review of all our businesses. We will provide further information on our strategy at the FY 2016 results on 1 December 2016.

Net debt

DMGT's strong operational cash flow and disciplined portfolio management have resulted in the expectation that the net debt to EBITDA ratio will be below the Group's preferred upper limit of 2.0 times at the end of the current financial year.

Outlook

DMGT continues to benefit from being a diversified portfolio operating in multiple sectors across B2B and consumer markets, with the majority of operating profits being earned outside the UK. The outlook for the Full Year remains consistent with current market expectations~, supported by the benefit of the stronger US dollar relative to the British pound.

Given the challenging market conditions facing certain businesses within the portfolio, reorganisation initiatives are being implemented to protect their profitability. These initiatives will create a greater strategic focus and enable more effective decision making across the Group, with the aim of generating future benefits and opportunities for long-term growth. The reorganisation initiatives, which include headcount reductions, are expected to result in total cash-related exceptional operating costs in the current financial year of approximately £50 million, rather than the £15 million previously guided to in May 2016. Approximately £35 million of the expected costs directly relate to the reorganisation. Further information on our strategy will be provided at the FY 2016 results on 1 December 2016.

Executive Leadership Changes

Paul Zwillenberg was appointed as Chief Executive of DMGT on 1 June 2016, following the retirement of Martin Morgan from the DMGT Board. Paul Zwillenberg was previously Global Leader Media Sector for The Boston Consulting Group and has worked closely with DMGT for 20 years. On 22 September 2016, it was announced that Stephen Daintith has resigned as DMGT's CFO to take up the role of CFO at Rolls-Royce Holdings plc in due course.

Market Abuse Regulation

As with previous financial announcements, the information communicated in this announcement includes inside information. DMGT has included this statement in this announcement in order to comply with the Market Abuse Regulation, which came into effect on 3 July 2016.

A conference call will be held with City analysts at 8.00 am on 29 September 2016. The dial-in number is +44 (0)20 3059 8125. A replay of the call will be available on DMGT's website at www.dmgt.com.

Future trading updates

DMGT's next scheduled announcement of financial information will be its preliminary results for the year ended 30 September 2016, which will be released on the morning of Thursday 1 December.

About DMGT

DMGT manages a balanced multinational portfolio of entrepreneurial companies, with total revenues of almost £2 billion, that provides a diverse range of businesses and consumers with compelling information, analysis, insight, news and entertainment.

Notes

# Underlying revenue is revenue on a like-for-like basis, adjusted for constant exchange rates, disposals, closures, non-annual events occurring in the current and prior year and acquisitions. For dmg information, underlying growth includes the year-on-year organic growth from acquisitions and excludes disposals. For dmg events, the comparisons are between events held in the year and the same events held the previous time. For Euromoney, disposals are excluded and a biennial event that took place in February 2016 is also excluded. For dmg media, underlying comparisons exclude Evenbase and Wowcher, which were disposed of during the prior and current years. dmg media's underlying growth includes the year-on-year organic growth from acquisitions and excludes the revenue from low margin newsprint resale activities.

~ Current City analyst expectations for DMGT for FY 2016 range from £1,824 million to £1,910 million for revenue, from £237 million to £256 million for adjusted profit before tax and from 49.9 pence to 54.4 pence for adjusted basic earnings per share with a consensus of £1,889 million, £249 million and 52.6 pence. Adjusted results are from continuing and discontinued operations and are stated before exceptional items, other gains and losses, impairment of goodwill and intangible assets, pension finance charges and amortisation of intangible assets arising on business combinations. Current City analyst expectations for dmg information revenue range from £450 million to £512 million with a consensus of £491 million.

† dmg media's results are to Sunday 21 August 2016 and are compared to the same forty seven week period and eight week period in July and August of the prior year.

* Daily Mail's 23.1% compared to 23.4% last year and The Mail on Sunday's 22.0% compared to 21.8% last year. Circulation market share figures are calculated using ABC's August 2016 and August 2015 National Newspapers Reports and excluding digital subscribers.

The average £:$ exchange rate for the eleven months was £1:$1.43 (against £1:$1.55 in the same period last year). The rate as at 27 September 2016 was $1.30 compared to the 30 September 2015 year end rate of $1.51.

This trading update is prepared for and addressed only to the Company's shareholders as a whole and to no other person. The Company, its Directors, employees, agents and advisers accept and assume no liability to any person in respect of this trading update save as would arise under English law. Statements contained in this trading update are based on the knowledge and information available to the Group's Directors at the date it was prepared and therefore facts stated and views expressed may change after that date.

This document and any materials distributed in connection with it may include forward-looking statements, beliefs, opinions or statements concerning risks and uncertainties, including statements with respect to the Group's business, financial condition and results of operations. Those statements and statements which contain the words "anticipate", "believe", "intend", "estimate", "expect" and words of similar meaning, reflect the Group's Directors' beliefs and expectations and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and which may cause results and developments to differ materially from those expressed or implied by those statements and forecasts. No representation is made that any of those statements or forecasts will come to pass or that any forecast results will be achieved. You are cautioned not to place any reliance on such statements or forecasts. Those forward-looking and other statements speak only as at the date of this trading update. The Group undertakes no obligation to release any update of, or revisions to, any forward-looking statements, opinions (which are subject to change without notice) or any other information or statement contained in this trading update. Furthermore, past performance of the Group cannot be relied on as a guide to future performance.

No statement in this document is intended as a profit forecast or a profit estimate and no statement in this document should be interpreted to mean that earnings per DMGT share for the current or future financial years would necessarily match or exceed the historical published earnings per DMGT share.

Nothing in this document is intended to constitute an invitation or inducement to engage in investment activity. This document does not constitute or form part of any offer for sale or subscription of, or any solicitation of any offer to purchase or subscribe for, any securities nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract, commitment or investment decision in relation thereto. This document does not constitute a recommendation regarding any securities.

Daily Mail and General Trust plc

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London, W8 5TT

www.dmgt.com

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