.Corporate review

corporate review

.Corporate Profile & Financial Highlights

.Chairman's Statement

.The Group at a Glance

.Chief Executive's Review

.Associated Newspapers

.Northcliffe Newspapers

.Euromoney Institutional Investor

.DMG Broadcasting: Television

.DMG Broadcasting: Radio

.dmg world media

.DMG Information

.Corporate Social Responsibility

.Financial and Treasury Review

.Board of Directors

financial review

.Directors' Report

.Corporate Governance

.Remuneration Report

.Auditors' Report

.Group Profit and Loss Account

.Group Cash Flow Statement

.Group Balance Sheet

.Group Total Recognised Gains and Losses

.Company Balance Sheet

.Accounting Policies

.Notes to the Profit and Loss Account

.Notes to the Cash Flow Statement

.Notes to the Balance Sheet

.Principal Subsidiaries

.Five Year Financial Summary

.Shareholder Information

.Websites and Products

.Financial review

19 Intangible Assets

(i) Goodwill is capitalised on new acquisitions made after 28th September, 1998. Such goodwill is amortised over the lower of its useful economic life and a period of 20 years. Goodwill arising on acquisitions made prior to 28th September, 1998 was written off directly to reserves.

(ii) Other intangible assets comprise publishing rights, titles, radio licences and certain other intangible assets.These assets were valued by the Directors and are stated at fair value on acquisition and are amortised over the lower of their useful economic life and a period of 20 years.

(i) These trade marks are amortised over the lower of their useful economic life and a period of 20 years.

20 Tangible Assets

(i) The Group’s properties, other than its specialised buildings, were revalued at 30th September, 1994, on the basis of external valuations and are depreciated over their useful economic lives. Subsequent additions are carried at historical cost, less accumulated depreciation, in accordance with FRS 15. Specialised buildings, being those properties constructed specifically for use in the business, are carried at historical cost less accumulated depreciation.

(ii) Group fixed assets include assets in the course of construction, made up as follows:

No depreciation was charged on assets in the course of construction during the year (2002 £Nil)

(iii) The net book value of Group plant and equipment includes £47.8 million (2002 £35.3 million) in respect of assets held under finance leases in a number of the Group's provincial newspaper centres. Depreciation of £6.5 million (2002 £4.9 million) was charged on such assets in the year.

(iv) No significant unprovided liability for taxation would have arisen, had the trading properties been sold at the balance sheet date for their net book values, due to the availability of "roll–over" relief.

The historical cost and related depreciation of Group properties are set out below:

21 Investments in Group Undertakings (as listed in the Principal Subsidiaries section)

Additions and disposals comprise intra–Group transfers of subsidiaries.

22 Investments in Joint Ventures and Associates

Information on principal joint ventures from the latest available accounts
(all incorporated in Great Britain and registered and operating in England and Wales unless otherwise stated).

Associates
Information on principal associates from the latest available accounts (all incorporated and operating in Great Britain unless otherwise stated).

(i) The market value of the listed shares at 28th September, 2003 was £89.0 million (2002 £62.2 million).

(ii) Material joint ventures have been accounted for under the gross equity method and associates under the net equity method using unaudited accounts to 28th September, 2003, provided in the case of listed associates that such information is public information at the latest practicable date for inclusion by the Group.

(iii) As part of the prior year transaction to acquire a 25% interest in George Little Management LLC, the Group receives a preferred profit distribution of US$1.5 million for the first five years to November 2005. The purchase agreement included ‘put and call options’ for the balance of the shares.
Details of these commitments are given in Note 37

(iv) Principal additions in the year were California Market Centre LLC and Indigo Holidays Limited both of which were transferred from long term investments.

(v) The Group has significant influence in Shopcreator plc and participates in its direction through board representation, even though its holding is below 20%.

(vi) Share of post–acquisition reserves is stated after deducting goodwill written off directly against reserves of £32.8 million (2002 £32.8 million). The carrying value of joint ventures and associates includes goodwill on acquisition by the Group, less cumulative amortisation, of £141.1 million (2002 £130.0 million). The charge for the year was £11.0 million (2002 £12.1 million) (Note 4).

23 Investments in Own Shares

(i) Investments in own shares at the year end comprise the cost of 3,627,687 'A' Ordinary Non–Voting shares (2002 3,027,687 shares), purchased by DMGT Trustees Limited, the Trustee of the DMGT Share Trust, for the purpose of meeting prospective exercises of options granted under the DMGT 1997 Executive Share Option Scheme. As required by UITF 13, these are included as assets on the Group balance sheet.

(ii) The market value of these shares at 28th September, 2003 was £20.1 million (2002 £15.2 million).

(iii) The DMGT Share Trust has waived its dividend rights on these shares.

(iv) After adjusting for the cost of buying shares to match options, exercisable under the 1997 Executive Share Option Scheme, in excess of the option exercise price, a provision of £2.5 million (2002 £2.1 million) has resulted (Note 30).

24 Other Investments

Investments are analysed as follows:

Information on principal investments, taken from latest published accounts (incorporated in Great Britain unless stated otherwise).

(i) Following a change of accounting policy, all investments are stated at historic cost (Note 34) less provision for any impairment.

(ii) The market value of the listed investments at 28th September, 2003 was £28.6 million (2002 £30.7 million).

(iii) At the beginning of the year, the Company had outstanding £65.3 million 2.5% exchangeable bonds 2004 (Note 29 v), exchangeable for 7.7 million shares of Reuters at an effective price of £8.29 per share. The bonds had been issued originally in May 1997 at 79.5% of their nominal value and their redemption amount accreted to 100% over the life of the bonds. Accordingly, the exchange price for the shares was to rise to a maximum of £9.75 in October 2004. In October 2002 the Company exercised its option to redeem these bonds at their amortised principal amount of £61.2 million.

25 Stocks and Work in Progress

The replacement cost of stocks and work in progress is not materially different from that shown above.

26 Debtors

(i) The increase in prepayments is partly caused by an advance payment into the Group’s pension scheme amounting to £21.4 million (2002 £Nil).

(ii) The Company’s corporation tax debtor represents amounts due from subsidiaries for Group relief.

(iii) The Group’s deferred tax asset primarily represents certain overseas tax losses.

27 Treasury Information

An overview of treasury policies is included within the Financial and Treasury Review.

Short–term debtors and creditors have been excluded from all of the following disclosures, other than those relating to currency risk.

Currency Exposures
The following table shows the degree to which companies within the Group have net monetary assets /(liabilities) in currencies other than their functional currency. Translation differences are taken to the profit and loss account of both Group companies and of the Group.

Currency and Interest Rate Composition of Financial Assets
These consist primarily of investments in Reuters shares and bank deposits.

* See Note 34

Committed Borrowing Facilities
The following undrawn committed borrowing facilities were available to the Group on 28th September, 2003 and at 29th September, 2002, in respect of which all conditions precedent had been met:

Financial Liability Maturity Profile
The maturity profile of the carrying value of the Group’s financial liabilities at the end of the year was as follows:

Financial Asset Maturity Profile
The maturity profile of the carrying value of the Group’s financial assets at the end of the year was as follows:

*See Note 34

Currency Profile of Financial Liabilities
The currency profile of financial liabilities, stated after taking account of applicable derivative instruments as at 28th September, 2003 and 29th September, 2002, was as follows:

The above tables do not take into consideration the effect of US dollar and Australian dollar forward contracts which are used by the Group to create synthetic currency debt. The impact of including these derivatives on the above tables is as follows:

At the year end, the Group had a number of fixed interest rate swaps outstanding. These amounted to US$80 million (2002 US$55 million) at rates between 6.375% and 5.0025% (2002 6.375% and 5.0025%) and Aus$10 million (2002 Aus$10 million ) at a rate of 6.575% (2002 6.575%). The Group also had outstanding floating rate interest rate swaps of £75 million (2002 £Nil) at rates between 3.5653% and 3.5901%.

The Group also had outstanding cross currency fixed to fixed swaps. These amounted to £39 million/US$65 million (2002 £Nil) resulting in the Group paying fixed US dollar interest at a rate of 2.615% and £10 million/Aus$25 million (2002 £Nil) resulting in the Group paying fixed Australian dollar interest of 5.66%.

The Group also had outstanding a number of interest rate caps. These amounted to US$130 million at rates of between 4% and 6% and Aus$50 million at rates of between 6% and 7%.

Interest Rate Risk Profile of Fixed Rate Financial Liabilities

Floating rate financial liabilities comprise Sterling–denominated bank borrowings and lease finance that bear interest at rates based on LIBOR, Sterling loan notes that bear interest at rates based upon LIBID and Australian and US dollar denominated borrowings that bear interest based upon LIBOR. A bank loan also exists that carries interest, based upon US dollar Prime.

Fair value of Financial Assets and Liabilities
Where available, market prices have been used to derive fair value. Forward foreign exchange contracts have been valued, using the closing forward rate of exchange on 28th September, 2003 and at 29th September, 2002 for the same forward value rate.

Derivative financial instruments, held to manage the interest rate and currency profile comprise interest rate swaps and forward foreign currency contracts. The book value of these instruments at the year end was £Nil (2002 £Nil) and the fair value was an asset of £8.0 million (2002 liability of £0.2 million).

Hedges
Unrecognised gains and losses on hedging instruments and the movements therein are as follows:

* See Note 34

28 Term Investments

These investments comprise bank deposits and other similar investments with original maturities exceeding one day.

29 Creditors

(i) Short–term bank loans of £20.9 million (2002 £33.4 million) are drawn on bank facilities expiring within one year and have thus been classified within creditors due within one year.

(ii) Loan notes attract interest at approximately LIBID to LIBID minus 1% and were issued as part of the consideration for various acquisitions. The loan notes are repayable at the option of the loan note holder.

(iii) In accordance with FRS 4, the Group’s bonds have been adjusted from their nominal values to offset the unamortised issue costs of £4.2 million (2002 £3.2 million). The issue costs are being amortised over the expected lives of the bonds.

(iv) In June 2003 the company issued £175 million 5.75% bonds due 2018 to refinance exisiting short–term indebtedness.

(v) The 2.5% exchangeable bond is a deep discount bond, the gross value of which increases on a daily basis for accretion to the principal such that the bond would have been valued at the end of its life in October 2004 at £75 million. During the year, such accretion amounted to £Nil (2002 £1.9 million) which has been charged as interest and added to the book value of the bond in the balance sheet. During October 2002 the Company exercised its option to redeem these Exchangeable bonds at their amortised principal amount of £61.1million.

(vi) The Group’s bank loans, payable after more than one year, are denominated in US dollars, Australian dollars and sterling. The interest rates on these borrowings ranged from 1.61% to 5.465% (2002 2.3% to 6.6%).

(vii) The interest rate on finance leases was approximately 8% (2002 8%).

(viii) The Group’s long–term borrowings are repayable as follows:

Details of creditors not wholly repayable within five years are as follows:

(ix) Leases over five years are repaid by instalments.

(x) The Company’s long–term borrowings are repayable as follows:

30 Provisions for Liabilities and Charges

Movements on other provisions were as follows:

31 Deferred Taxation

Movements on the provision for deferred taxation were as follows:

Contingent (assets)/liabilities and gains in respect of deferred taxation, not included in the balance sheet, were as follows:

(i) The deferred tax assets disclosed in Note 26 in respect of overseas tax losses, relate primarily to trading losses incurred in the US and Australia and have been recognised on the basis that the Directors are of the opinion based on recent and forecast trading, that sufficient suitable taxable profits will be generated in the relevant territories in future accounting periods, such that it is considered more likely than not than these assets will be recovered. The unrecognised deferred tax asset of £32.4 million above relates primarily to overseas tax losses where there is insufficient certainty that these losses will be utilised in the immediate future.

(ii) No deferred tax has been provided on revalued assets due to the availability of realised capital losses for which no deferred tax asset has been recognised.

(iii) There are additional unprovided capital losses carried forward which have not yet been agreed with the Inland Revenue.

(iv) The Group is able to obtain tax relief in some overseas territories for the cost of goodwill arising on its acquisitions of some businesses. In certain cases the goodwill was written off to reserves under the transitional rules set out in FRS 10. Utilisation of the available tax relief in the overseas territories gives rise to a timing difference as set out above. The potential timing differences will only reverse on sale of the relevant businesses. As the relevant businesses are considered core to the Group there is currently no intention to dispose of them. The potential reversal is so far into the future that after discounting, the potential liability becomes insignificant. The effect of discounting the Group’s accelerated capital allowances is a credit of £4.1 million (2002 £3.6 million). The effect of discounting the Group’s other deferred tax assets and liabilities is not material.

32 Called Up Share Capital

(i) The two classes of shares are equal in all respects, except that the ‘A’ Ordinary Non–Voting shares do not have voting rights and hence their holders are not entitled to attend or to vote at general meetings of the Company.

(ii) During the year, 256,000 ‘A’ Ordinary Non–Voting shares were allotted for aggregate consideration of £570,530 under the terms of the Company’s 1989 Executive Share Option scheme.

(iii) At 28th September, 2003, options were outstanding under the terms of the Company’s 1989 and 1997 Executive Share Option Schemes over a total of 4,155,735 (2002 3,647,500) ‘A’ Ordinary Non–Voting shares as follows:

*vested/exercisable
+see Note vii

(iv) These options were granted at market value at the date of grant and none required any payment. They are not normally exercisable before the third anniversary of the date of grant and in all circumstances will lapse if not exercised within ten years.

(v) In the case of the 1997 Executive Share Option Scheme, they are normally exercisable only when the relevant performance conditions have been met. The first condition is that, in respect of four out of six consecutive monthly calculation dates (which start in the thirtieth month following the date of grant of a particular option), the total shareholder return (‘TSR’) of the Company must exceed that of the FTSE 100 index. Secondly, there must be real growth in earnings per share over a period of three consecutive financial years.

(vi) Options granted in June, July and December 1997 at respective prices of £4.070625, £4.30 and £4.7375 per share are exercisable as both performance criteria have been met. Options granted in December 1998 at £6.475 per share vested on 26th November, 2003 when the earnings per share condition was met; the TSR condition was met in October 2001.

(vii) The earnings per share condition was also met in the year in respect of the options granted in December 1999 at £10.295 per share, in June 2000 at £10.96 per share, in December 2000 at £8.34 per share and in July 2001 at £7.25 per share since real growth in adjusted earnings per share was achieved in the year, compared to that of three years previously. The TSR condition has not been met so far in respect of these options. As a consequence, none of these options has vested yet.

(viii) Movements on the two executive share option schemes were as follows:

33 Reserves

(i) The write back of taxation on unrealised gain on disposal of businesses relates to the sale of certain assets of DMG Radio in 2000 and reverses the accounting treatment adopted in that year when the gain on sale was unrealised.

(ii) The transfer from the revaluation reserve recognises the progressive realisation of a previously unrealised gain on disposal of businesses to GWR Group plc, as the goodwill on the interest in GWR is amortised.

(iii) At 28th September, 2003, cumulative goodwill of continuing businesses of £683.9 million (2002 £688.9 million) had been written off against the profit and loss account.

34 Prior Year Adjustment

The financial information for the year has been prepared in accordance with the accounting policies adopted last year, as amended to show listed investments included within other investments, at cost less impairment, if any, rather than at market value.

The effect of this change is explained in the Accounting Policies under the heading "Changes in Presentation of Financial Information".

35 Summary of the Effects of Acquisitions

The principal acquisitions completed during the year and the dates of acquisition were:

(i) The aggregate consideration for these and other businesses was £53.9 million, of which £37.4 million was paid during the year and an estimated amount of £10.5 million payable in the form of deferred consideration, dependant upon trading results. This deferred consideration has been discounted back to current values in accordance with FRS7. In each case, the Group has used acquisition accounting to account for the purchase.

36 Summary of the Effects of Disposals

The principal disposals completed during the year and their dates of disposal were:

The aggregate consideration for these and other businesses, was £6.5 million, all of which was received in the form of cash.

The impact of disposals on net assets was:

37 Commitments

At 28th September, 2003 the Group had annual commitments under non-cancellable operating leases as follows:

Most property leases are subject to rent reviews.

The Group has entered into arrangements with its ink suppliers to obtain ink for the next three years to 2005 at competitive prices and to secure supply. At the year end, the commitment to purchase ink over the period was £32.2 million (2002 £31.2 million).

dmg world media USA acquired a 25% stake in George Little Management LLC in November 2000. The purchase agreement included ‘put and call’ arrangements to acquire the membership interests of the other members of GLM. The details are as follows:

(i) With effect from 1st October, 2005, the other members have the right to put their membership interests to the Group at a fair market value. The initial put to the Group cannot be less than 50% of the total outstanding membership interest.

(ii) On 1st October, 2010, the Group will increase its membership interests in GLM to 51%, subject to (i) above, by calling the appropriate number of membership interests held by the other members, at fair market value.

(iii) At 1st October, 2014, the Group is required to acquire any remaining membership interests which it does not own in GLM, at fair market value.

(iv) In certain circumstances, the Group is required to purchase the membership interests of individual members of GLM. These circumstances include disability, death, retirement and termination of employment.

38 Contingent Liabilities

Four writs claiming damages for libel have been issued in Malaysia against Euromoney Institutional Investor and three of its employees in respect of an article published in one of Euromoney’s magazines, International Commercial Litigation, in November 1995. The writs were served on Euromoney in October, 1996. The total amount claimed is 280 million Malaysian ringgits, £50.0 million (2002 £50.0 million). No provision has been made in these financial statements since the Directors do not believe that Euromoney has any material liability in respect of these writs.

At 28th September, 2003 the Group had outstanding commitments under forward foreign exchange contracts amounting to £108.5 million (2002 £180.2 million).

At 28th September, 2003, the Company had guaranteed borrowing facilities and finance leases of subsidiaries under which £353.0 million (2002 £353.0 million) were outstanding. The Company had also guaranteed a subsidiary’s interest rate derivatives with a principal value of £30.1 million (2002 £29.3 million) and letters of credit of £6.3 million (2002 £8.8 million).

California Market Centre LLC ("Cal Mart"), a joint venture of the Group, signed a five year US$82 million loan agreement. As manager of Cal Mart the Group is liable for any default on Cal Mart’s loan caused by illegal activities, wilful or gross negligence, misrepresentation or similar circumstances. The Group believes that the circumstances under which such a liability may arise are unlikely. The Group has also indemnified Cal Mart’s lenders for up to US$6.5 million through letters of credit.

39 Pension Arrangements

The Group operates several pension schemes covering most major UK group companies under which contributions are paid by the employer and employees.

The schemes for most employees are funded defined benefit pension arrangements, providing service-related benefits, based on final pensionable salary. The assets of the schemes are held independently from the Group’s finances and are administered by trustee companies. Pension costs are assessed on the advice of an independent qualified actuary following triennial valuations using the projected unit method.

A valuation of the principal schemes was carried out as at 31st March, 2001. The assumptions having the most significant effect on the results of the valuations are shown in the following table:

The contribution rate paid by employees in the principal schemes is 5% of pensionable salaries and the company cash contribution to these schemes has been 12% of pensionable salaries. These schemes remain open to eligible new employees.

The pension charge for the year ended 28th September, 2003 was £23.8 million (2002 £21.5 million).

The components of the total pension charge were as follows:

A prepayment of £41.1 million (2002 £16.0 million) is included under debtors, representing the excess of accumulated contributions paid over the equivalent pension charge. A provision of £0.7 million (2002 £0.4 million) is included in provisions, representing the excess of the accumulated pension charge over pension contributions paid.

The surpluses identified from the valuation of the principal schemes are amortised over a period of 11 years using the straight line method. The pension cost to the Group of its principal schemes over the estimated average service life of employees is currently between 8.1% and 10.4% of pensionable salaries.

A further interim valuation of the principal schemes as at 31st March, 2003 on the normal funding basis highlighted changes in financial market conditions since 31st March, 2001 and, in particular, a reduction in investment returns. Although the principal schemes were in surplus on the normal funding basis, in anticipation of the results of the next full valuation in 2004, the Company has agreed with the Trustees that its cash contribution rate should be increased from 12% to 15% of pensionable salaries from 1st October, 2003.

The effect of UITF 6, ‘Accounting for post-retirement benefits other than pensions’, is not material.

FRS 17
In accordance with the requirements of FRS 17, Retirement Benefits, this note discloses the main financial assumptions made in valuing the liabilities of the schemes and the fair value of assets held. Additionally, this note discloses the amounts that would be charged or recognised in the financial statements under the requirements of FRS 17, together with an analysis of the movement in scheme surpluses or deficits which would result. However, as permitted by FRS 17, the costs, accruals and prepayments recorded in the financial statements continue to be reported under the requirements of SSAP 24 ‘Accounting for Pension Costs’.

Defined Benefit Schemes
The figures in this note are based on the calculations carried out in connection with the formal actuarial valuation of the main schemes as at 31st March, 2001 and an interim valuation as at 31st March, 2003, updated to 28th September, 2003 by the actuary.

The main financial assumptions used for FRS 17 purposes are shown in the following table:

The fair value of the assets held by the pension schemes, the long-term expected rate of return on each class of assets and the value of the schemes’ liabilities assessed on the assumptions described above are shown in the following table:

The assets weightings indicated in the table above are monitored by the schemes’ trustees and should be viewed against a background where the schemes remain open to new, eligible employees. Additionally, the schemes generate a net positive cash flow. Thus, assets are not being sold to cover current benefit commitments.

An analysis of the amount which would be chargeable to operating profit is shown below:

An analysis of the amount which would be credited to other finance income is shown below:

An analysis of the amount which would be recognised in the statement of total recognised gains and losses (STRGL) is shown in the following table, together with the components shown as a percentage of scheme assets or liabilities:

The movement in deficit during the year is shown in the following table:

If the previous amounts had been recognised in the financial statements, the effect on shareholders’ funds would have been as shown below:

UK Defined Contribution Plans
A number of defined contribution pension plans are operated by certain divisions of the Group where a business case exists for this type of pension provision. The pension cost attributable to these plans during the year amounted to £3.1 million (2002 £3.0 million).

An amount of £0.5 million (2002 £0.5 million) is included in provisions representing outstanding contributions due at the balance sheet date.

Overseas Pension Plans
Overseas subsidiaries of certain Group divisions operate defined contribution retirement benefit plans, primarily in North America and Australia. The pension cost attributable to these plans during the year amounts to £3.5 million (2002 £2.0 million).

Pension Arrangements for Executives
The Group operates a two-tier, non-contributory defined benefit pension scheme for senior executives (including Executive Directors), details of which are incorporated in the above disclosures. It is the Company’s policy that annual bonuses, payments under the Executive Bonus Scheme and benefits in kind are not pensionable.

Included in UK Defined Contribution Plans above are investments in a funded unapproved retirement benefit scheme for certain executives of the Group including one Executive Director who are subject to the pensionable earnings cap imposed by the Inland Revenue. The assets of this scheme are held under individual trusts independently from the Group’s finances; investment during the year totalled £0.4 million (2002 £0.5 million).

Stakeholder Pensions
DMGT provides access to a stakeholder pension plan for relevant employees who are not eligible for the other pension schemes operated by the Group.

40 Ultimate Holding Company

The Company’s ultimate holding company is Rothermere Continuation Limited, a company incorporated in Bermuda.

41 Related Party Transactions

The Company has taken advantage of the exemption under FRS 8 ‘Related Party Disclosures’, not to disclose related party transactions between subsidiaries. The disclosures that are required under FRS 8 are set out below.

Ultimate Controlling Party
The Company’s ultimate controlling party is the Viscount Rothermere, the Company’s Chairman. Transactions relating to the remuneration and shareholdings of the Viscount Rothermere are given in the Remuneration Report.

Transactions with Directors
There were no material transactions with Directors of the Company, except for those relating to remuneration and shareholdings, disclosed in the Remuneration Report.

Transactions with Joint Ventures and Associates
Associated Newspapers has a 50% joint venture interest in Zoom. During the year, it funded its share of the operations of Zoom by way of loans. The amount due from Zoom at 28th September, 2003 was £4.9 million (2002 £4.9 million) which is included in investments in joint ventures (Note 22).

Associated Newspapers has a 17% investment in Shopcreator plc which is an associate. During the year, the Group received advertising revenue from Shopcreator of £Nil million (2002 £0.2 million). The amount due from Shopcreator at 28th September, 2003 was £Nil (2002 £Nil).

Associated Newspapers has a 38% investment in Indigo Holidays Limited which is an associate. During the year, the Group received advertising revenue from Indigo Holidays of £1.8 million (2002 £1.8 million). The amount due from Indigo Holidays at 28th September, 2003 was £2.2 million (2002 £0.2 million).

During the year, Northcliffe Newspapers Group Limited provided equity funding of £2.3 million (2002 £2.0 million) to Fish4 Limited, a 22.9% associate. Full provision has been made against this funding in these financial statements.

During the year, Teletext Holdings Limited provided £1.0 million funding to GWR Group plc. This remained outstanding at the year end. Details of the Group’s principal joint ventures and associates are set out in Note 22.

All transactions with joint ventures and associates arose in the normal course of business. Material transactions are set out as follows:

The Group has contracts with Greenland Interactive Limited, a joint venture, whereby Greenland administers premium-rate telephone lines and a customer care line. During the year, the Group received £0.7 million (2002 £1.4 million) from Greenland in respect of premium rate telephone revenue and paid £Nil (2002 £0.1 million) to Greenland for administration fees. At 28th September, 2003, £Nil was outstanding (2002 £0.1 million).

Other Related Party disclosures
At 28th September, 2003, there was an interest-free loan of £79,000 (2002 £181,000) made to Mr M MacLennan, managing director of Associated Newspapers, to assist with relocation after joining the Group. The maximum amount outstanding during the year was £181,000. At 28th September, 2003, there was a further loan of £105,344 (2002 £105,344), made to Mr MacLennan to enable him to purchase shares in the Company in order to commit them to the LTIP. The loan bears interest at 6% per annum. The maximum amount outstanding during the year was £105,344.

At 28th September, 2003 there was a loan of £196,669 (2002 £205,072) made to Mr K J Beatty, Managing Director of Northcliffe Newspapers, to assist with relocation after joining the Group. The loan bears interest at 2 1/2% per annum. The maximum amount outstanding during the year was £205,072. At 28th September, 2003, there was a further loan of £56,574 (2002 £56,574), made to Mr Beatty to enable him to purchase ‘A’ Ordinary Non-Voting shares in the Company in order to commit them to the LTIP. The loan bears interest at 6% per annum. The maximum amount outstanding during the year was £56,574.

At 28th September, 2003 the Group owed £3.1 million (2002 £4.4 million) to the pension schemes which it operates. This amount comprised employees’ and employer’s contributions in respect of September 2003 payrolls, which were paid to the pension schemes in October 2003.

The Group recharges its principal pension schemes with costs of investment management fees. The total amount recharged during the year was £0.4 million (2002 £0.5 million).

42 Post Balance Sheet Events

Details of material post balance sheet events are given in the Directors’ Report.