CHIEF EXECUTIVE'S INTRODUCTION

SUSTAINED INVESTMENT IN SOUND BUSINESSES THROUGHOUT THE ECONOMIC CYCLE NOW PUTS US IN A STRONG COMMERCIAL POSITION.

Compound dividend growth over the last ten years is 10%

We have outperformed the media sector by 13%

Q: Your results this year are good. Is this because your businesses have been operating in booming sectors?

A: It's down to a combination of factors. Certainly some of our business sectors have been showing strong growth - UK regional newspaper and Australian radio advertising would be two examples. But in addition most of our businesses have been growing their market share and operating more efficiently, and we've made some helpful acquisitions.

Q: How did the Board set the dividend in such a good year?

A: DMGT has a policy of seeking to increase the dividend in real terms every year, regardless of the results with in reason, as long as we continue to have confidence in the strength of our businesses. This year, the Board decided to go to the top of the range that they hope to maintain. It means that the compound dividend growth over the last ten years is 10%.

Q: Can you outline the reasons behind the largest acquisitions and disposals DMGT has made this year?

A: The biggest moves this year have been in Australian radio. We bid successfully for licences in Adelaide and Brisbane, which will enable us to complete our national Nova network of stations, and in Sydney and Melbourne, where we will be able to run a second station alongside Nova. Finally we sold our regional stations because someone offered us a very good price and we wished to focus on metropolitan markets. Elsewhere, Euromoney added to its thriving conference business with the purchase of IMN, and DMG Information bought Trepp and, since the year end, Lewtan, to add to its fast-growing business to business information division. Generally we look for acquisitions that will expand or extend existing successful operations in the Group. Of course, the biggest deal would have been the one we did not do, namely the Telegraph Group. Lord Rothermere has referred to that in his statement.

Q: What do you see as the greatest risks facing DMGT?

A: This is a question that occupies a lot of our time, and rightly so. Inevitably we face economic risks in terms of the health of the economies and the markets in which we operate. There is little that we can do about these in the short term, but for some time we have pursued a policy of investing as willingly in selected overseas markets as in the UK, and we watch the long term health of the markets we serve. We consider that our businesses have two essential assets, our brands and our people. The key risks over which we can have some control are reputation, our capacity to compete and retention of staff. On each of these we have a good record, but we are never complacent. They are all a regular focus of the Group Risk Committee, which I chair and about which you can read in the Corporate Governance section. But we never forget that we are paid to take risks, but manage them.

Q: On the issue of staff retention, DMGT is very unusual in continuing to keep open final salary pension schemes, almost unique in the media sector. Why is this and how are they doing?

A: We believe in trying to provide the appropriate form of pension provision to all our employees. Thus we have retained final salary pension schemes for our UK newspaper divisions where people tend to stay with us for a long time and where we have a lot of employees over 35. In the other divisions, where many of the employees are younger, and which are more international, we believe defined contribution schemes are more appropriate. For the final salary schemes, it's been another interesting year, with pensions regularly creating newspaper headlines, ever more schemes being closed and ever more legislation. During the year, we have been undertaking the triennial actuarial review of our schemes. They remain in better shape than many, at worst only marginally in deficit, and, importantly, continue to have an excess of cash inflows over cash outflows to finance benefit commitments. But the cost of providing the benefits they promise continues to grow, mainly because people are living longer.

We have decided once more to keep our schemes open, because we believe they are appropriate. However, in view of the cost pressures, we are informing members of changes we will be making next year. Any employee who wants to continue earning pension benefits at the same rate as now will be asked to increase their contributions; if they pay the same as now, they will in future earn benefits at a lower rate, as will new employees, at least for their first five years with us. The Group will also be increasing again its contributions into the schemes, but we have been able to hold the cost to an acceptable level, while also being able to focus the investment on our long term employees.

Q: Your share price has performed well in the last twelve months, up 17% in the year to November 2004. Is this in your view a sensible reflection of the Company's performance?

A: This short term increase does mirror the improvement in our trading results over the same period and represents 13% outperformance of the media sector. However, we believe it is more appropriate to look at the long term share price performance against the market and our peers. As you can see in the graphs below, we have done well over five years and even better over longer periods.

Q: In which direction do you see DMGT going over the next few years?

A: More of the same. I am sure that newspapers will continue to be a vibrant media form for many years and will remain at the heart of DMGT. At the same time we hope to continue to grow our non-newspaper divisions and we may well find more acquisitions in these areas than in newspapers. Valuing our people Share price rises We believe in trying to provide the appropriate form of pension provision to all our employees. The share price has performed well in the last twelve months, up 17% in the year to November 2004.

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