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Intermediate Capital Group PLC (ICP)

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Wednesday 01 June, 2011

Intermediate Capital Group PLC

Final Results






Embargoed until 7.00am on Wednesday 1 June 2011

Preliminary results
for the year ended 31 March 2011

Intermediate Capital Group plc ("ICG") announces its preliminary results for the
year ended 31 March 2011 (unaudited).

Financial highlights:
  * Group profit before tax up 76% to £186 million (£106 million in 2010)
  * Fund Management Company profit before tax of £36 million (£31 million in
    2010 excluding a £7 million one-off release of accrued costs)
  * Investment Company profit before tax of £150 million, up 122%  as a result
    of lower provisions, additional writebacks and higher capital gains (£68
    million in 2010)
  * Proposed final dividend of 12 pence per share; 18 pence for the full year,
    up 6% from 17 pence last year



Operational highlights:
  * Strong performance across the investment portfolios with 74% of portfolio
    companies performing at or above the prior year (59% in 2010)
  * 13 investments exited for 1.8 times money multiple and an 18% IRR
  * £1 billion new investments including £311 million from our balance sheet
  * AUM up 5% to €11.8 billion, with third party AUM up 9% to €9.0 billion due
    to the Eos Loan Fund I


 Financial summary:                           31 March 2011   31 March 2010
                                              (Unaudited)     (Audited)
----------------------------------------------------------------------------
 Fund Management Company* profit before tax   £36m            £31m**

 Investment Company* profit before tax        £150m           £68m

 Group profit  before tax***                  £186m           £106m

 Group profit  after tax***                   £128m           £82m

 Earnings per share***                        32.6p           25.0p

 Total dividend per share                     18p             17p

 Cash core income****                         £107m           £115m

 Investment portfolio                         £2.6bn          £2.7bn

 Third party AUM*****                         £8.0bn          £7.3bn
----------------------------------------------------------------------------
* The Fund Management Company and Investment Company are defined in the
Financial Review.
** Excluding a £7 million one-off release of accrued costs
*** Including impact of fair value movements on derivatives (FY11: loss of
£3.8m; FY10: gain of £0.1m)
**** Cash core income is defined in the Financial Review
***** Assets under management ("AUM") is defined in the Financial Review

Commenting on the results, Christophe Evain, CEO, said:

"This has been a great year for ICG and one of the most profitable in our 22
year history and well ahead of our earlier expectations. We have seen a marked
improvement in the performance of our investments, realised significant value
via 13 exits and increased our investment activity, investing a total of £1
billion in several proprietary deals. We have also taken further steps to grow
our Fund Management Company."

Analyst / Investor enquiries:

Christophe Evain, CEO, ICG+44 (0) 20 3201 7700
Philip Keller, CFO, ICG +44 (0) 20 3201 7700
Jean-Christophe Rey, Investor Relations, ICG+44 (0) 20 3201 7768

Media enquiries:
Mark Lunn, Corporate Communications, ICG                +44 (0) 20 3201 7769
Charlotte Kirkham/ Tim Draper, M:Communications                 +44 (0)
20 7920 2331


This Preliminary Results statement has been prepared solely to provide
additional information to shareholders and meets the relevant requirements of
the UK Listing Authority's Disclosure and Transparency Rules. The Preliminary
Results statement should not be relied on by any other party or for any other
purpose.

This Preliminary Results statement may contain forward looking statements. These
statements have been made by the Directors in good faith based on the
information available to them up to the time of their approval of this report
and should be treated with caution due to the inherent uncertainties, including
both economic and business risk factors, underlying such forward looking
information.

These written materials are not an offer of securities for sale in the United
States. Securities may not be offered or sold in the United States absent
registration under the US Securities Act of 1933, as amended, or an exemption
therefrom. The issuer has not and does not intend to register any securities
under the US Securities Act of 1933, as amended, and does not intend to offer
any securities to the public in the United States.  No money, securities or
other consideration from any person inside the United States is being solicited
and, if sent in response to the information contained in these written
materials, will not be accepted.


About ICG
Founded in 1989, ICG is a specialist investment firm and asset manager providing
mezzanine finance, leveraged credit and minority equity, managing €11.8 billion
of assets in proprietary capital and third party funds. ICG has a large and
experienced investment team operating from its head office in London with a
strong local network of offices in Paris, Madrid, Stockholm, Frankfurt,
Amsterdam, Hong Kong, Sydney and New York. Its stock (ticker symbol: ICP) is
listed on the London Stock Exchange. Further information is available
at:www.icgplc.com.

Chairman's Statement



This has been a particularly strong year for ICG and I am pleased to report that
we have generated a profit before tax of £186 million, up 76% compared to last
year's £106 million. We have made progress towards our three key strategic
priorities: managing our portfolio to maximise value; investing selectively; and
growing our Fund Management Company.

We have demonstrated our ability both to source and structure unique deals,
resulting in a significant level of investment. In particular, Eos Loan Fund I -
the fund created for the acquisition of a €1.4 billion portfolio of senior loans
from RBS - attests to this ability. ICG is one of the very few asset managers
able to analyse, price, manage and underwrite a transaction of this scale and
complexity.

We deployed a total of £1 billion on behalf of our shareholders and mezzanine
funds in spite of a slow market for mezzanine investments. £311 million was
invested from our balance sheet, a higher amount than we expected at the start
of the year. This reflects the strength of our local networks across Europe, the
United States and Asia Pacific and our ability to create investment
opportunities in a challenging environment.

We have realised significant value from our portfolio of investments with a
total of 13 exits in the financial year leading to capital gains of £133
million. This represents the third highest level of capital gains in our 22 year
history.

The performance of our investment portfolio has improved steadily throughout the
last 12 months as the economic environment stabilised with 74% of our investee
companies performing at or above prior year, compared to 59% last year. This is
in spite of having exited strong performing companies. As a result, gross
impairments are materially lower and we have started to benefit from write-backs
on the assets which have shown a significant improvement in trading. Therefore
net impairments are also lower at £71 million.

We grew AUM by 5% to €11.8 billion, with third party AUM of €9 billion, up 9%,
thanks in large part to the Eos Loan Fund I. Our Fund Management Company has
also benefited from excellent results across all our mezzanine, senior loan and
high yield bond funds.

Since 2000, our mezzanine and minority equity funds have generated net multiples
in line with top quartile performance of private equity returns and we are
confident that we can maintain this level in the future.

Our credit funds have also performed well. Our loan funds have maintained a very
low default rate of 1.5% and all of these funds are now paying performance
related fees. Furthermore our European High Yield Fund has consistently
outperformed the market. The fund generated a net return of 14% in 2010 and has
already achieved a 4% net return in the first four months of 2011.

Capitalising on this track record of performance we have begun marketing a new
European mezzanine and minority equity fund to global institutional investors as
a successor to ICG European Fund 2006. In addition, we have opened our European
High Yield Bond Fund to third party investors and continue to market our loan
funds.

Overall, we have had an excellent year and we are building momentum towards
achieving our strategic objectives.



Outlook and strategy
Our strategy and priorities continue to focus on building a specialist fund
management business supported by a strong Investment Company.

In the short term, we expect the current buyout market liquidity to remain
broadly similar, providing further opportunities to make profitable exits.
 Although the investment environment remains challenging, we are seeing a
promising pipeline of mid-market deals across our geographies and we will
continue to pursue investment opportunities through our relationships, local
presence and structuring ability to gain early access to proprietary
investments.

In the medium term, the high levels of European buyout debt maturing over the
next four years at the same time as CLO reinvestment periods expire, will create
demand for new sources of capital to fill the gap. We will grow AUM by
continuing to market our mezzanine, loans and high yield funds to take advantage
of this market opportunity.

Dividend
As a result of maintaining a high level of cash core income at £107 million and
the positive outlook, the Board recommends a final dividend of 12 pence per
share, making a total of 18 pence per share for the year. This represents a 6%
increase compared to last year.

The dividend will be paid on 19 August 2011 to shareholders on the register at
15 July 2011. The Board has decided to maintain the scrip dividend scheme
introduced in June 2009 in order to give shareholders greater flexibility. This
scheme allows shareholders to elect to receive future dividends in shares as
opposed to cash.

Employees
I would like to thank our employees for a year of hard work and considerable
achievement.



Business Review

Our Market
After three years of crisis, the buyout market looks as though it is returning
to some sort of normality. To our eyes, however, all is not what it seems.

Equity capital
Buyout transactions resumed in 2010 with the help of a strong high yield market
and the recycling of CLO cash into new loans. The majority of deals have been
serial buyouts; high prices have been paid by private equity firms supported by
the vast amount of capital raised before 2008 that still needs to be put to
work. There is still over €150 billion of unspent private equity commitments in
Europe alone and strong companies which have shown resilience throughout the
recession have been in particularly high demand.

However, fewer such companies remain available to buy and many of these are
already in the process of exiting. As we look at the next layer of buyout
companies, their quality and performance cannot justify such high valuations.
Private equity owners will want to hold these assets for longer to generate
acceptable returns on their original investment. Unless performance picks up
significantly from today's levels, this will inevitably slow the pace of
secondary deals. Meanwhile, a more stable economic environment will start to
generate investment opportunities in the primary mid-market with existing
leveraged finance arrangements that require restructuring also generating
opportunities to invest.

Debt capital
But where does the funding to support mid-market deals come from? The European
high yield market has seen a record level of €45 billion of issuance in 2010,
representing more than 1.5 times the European record set in 2006 and these
trends are continuing into 2011. A growing number of buyout companies are
refinancing by issuing high yield bonds and as they repay their debt, the CLOs -
owners of a large part of the outstanding senior secured loans - receive a
prepayment which they are recycling by buying loans, new and old.

As a result, close to €20 billion of new senior debt was issued in 2010. Whilst
this is a fraction of the €350 billion of debt available in the three year
period 2005 -2007, it has been sufficient to support recent mid-market buyout
transactions, giving banks the confidence to arrange syndicated loans to finance
and refinance buyouts, mostly sold to CLOs. The liquidity generated in the high
yield market and recycled in the sub-investment grade market has also supported
a rally in loan prices.

High levels of liquidity in the European buyout market, in the form of recycled
debt and available equity capital, created a more challenging investment
landscape for mezzanine investments.

Looking forward
However, this recycling of loans will gradually cease between 2011 and 2014 as
CLOs reach the end of their reinvestment period and will have to repay their
liabilities with every new repayment of an asset rather than rolling the
proceeds into new loans. The implications for the debt market are significant as
the syndicated loan market will lose approximately €50 billion of capacity; most
of it expiring rapidly from 2012 onwards. This is a significant gap.

Moreover, there is a large amount of European buyout debt that needs to be
extended or refinanced between 2012 and 2015 as it reaches maturity. Unlike the
US market, where significant efforts have been made to extend the maturity of
leverage loans, the wall of maturing European debt has yet to be tackled. Whilst
maturity extension will be possible for loans that have not been repaid, these
loans cannot be extended beyond the final tenure of the funds holding them,
which creates an increased demand for new replacement capital.

No new European CLOs have been raised over the past three years because higher
margins on CLO debt and higher expectations on equity returns make them
economically unviable. Nor are banks willing to drive growth through balance
sheet expansion in the leveraged finance space.

A liquidity shortfall will emerge from this unbalanced market as traditional
sources of debt finance evaporate, driving demand for alternative sources of
capital to finance new leverage, refinancings and corporate acquisitions.
Mezzanine, high yield bonds and institutional leveraged loans will represent a
large part of the funding solution and new funds will be raised gradually to
bridge the refinancing gap.

In the current market and, in spite of the current level of liquidity, we have
been able to identify and create attractive investment opportunities from local
pockets of value. In the future, market trends will create an even larger
funding gap to be filled by asset managers and investors with the right skills
in high yield, mezzanine and sub-investment grade debt. ICG is well positioned
to compete in all of these asset classes.

Fundraising market
The fundraising environment remains challenging but shows signs of improvements.
Ongoing changes in the regulatory environment, particularly for banks, pension
funds and insurance companies, are creating a level of uncertainty and this is
hampering the ability of some institutions to commit to long term investment
decisions. There is, however, evidence that established players can now raise
new funds after a two year hiatus.

The majority of institutional investors are now focusing on their longer term
investment strategies having positioned themselves tactically to benefit from
the rally seen in many asset classes in both 2009 and 2010.

Institutional investors who have been disappointed by the performance of listed
equity and traditional fixed income assets in recent years are showing interest
in alternative investment products. Within the alternative asset class, the
strong and consistent performance of mezzanine and its low correlation with most
asset classes has been noticed by institutional investors.

Moreover, new issuance in the high yield market has created a well diversified
market and the loan to bond trend is providing further investment opportunities
which is attracting yield-seeking investors.

Following the crisis, investors are exercising greater diligence when selecting
an asset manager and only those with a long track record of performance, a
stable team and proven business model are likely to attract new capital.






Year in Review

Overview
We have enjoyed a strong financial performance for the full year, reporting a
profit before tax of £186 million. This represents one of the most profitable
years in ICG's 22 year history.

The performance of the portfolio improved significantly throughout the year and,
as a result, impairments further declined. We have been able to write back £19
million of provisions on four assets which have shown a material recovery.

The European buyout market returned in 2010 and has remained active throughout
this year, fuelled by secondary deals. We took full advantage to exit 13
investments (11 in Europe) held in our portfolio and funds, generating realised
returns for our investors and shareholders.

Whilst a short term oversupply of debt and equity capital created a favourable
market for exits, it also squeezed the standard mezzanine market, raising
challenges for re-investing. However, the ability of our network of investment
professionals to gain early access to local opportunities and create tailored
structures resulted in a string of innovative and unique investments for ICG. In
total, we invested close to £1 billion over the course of the year from our
Investment Company and third party funds.

We have taken further steps to increase the rate of growth of our Fund
Management Company via new fund raising, entry into an adjacent asset class and
complementary acquisitions.


Strategic priorities
Our strategy remains consistent: manage our portfolio to maximise value, invest
selectively and grow our Fund Management Company.

 1. Manage our portfolio to maximise value

Portfolio performance showed strong and consistent improvement throughout the
year due to a more positive economic environment with top-line growth across the
majority of portfolio companies leading to significant increases in EBITDA. As
at 31 March 2011, 74% of the portfolio was performing at the level of or better
than the prior year compared to 59% last year and 62% in September 2010. In
addition leverage had been reduced across the board.

This markedly improved portfolio performance has led to significantly lower
gross impairments of £90 million compared to £180 million last year. In
addition, we have also written back £19 million of provisions relating to four
assets, the performance of which have improved materially.  As a result net
impairments were £71 million compared to £162 million last year.

We also took full advantage of the favourable exit conditions to realise value
at attractive levels of return.  In the year, we have achieved 13 exits with an
average money mutiple of 1.8 times and an IRR of 18%.

In Europe we benefited from 11 exits: Picard, Medica, Visma, Eurofarad,
TeamSystem, Loyalty Partners, Pasteur Cerba, Geoservices, Sebia, Gerflor and a
partial exit from Labco.

In the U.S we realised our investment in Behavioral Interventions.

In Asia Pacific we exited Taiwan Broadband Company and, shortly after the close
of our financial year, we exited our 2006 investment in Tegel in New Zealand.

In total, over the twelve months ended 31 March 2011 we generated £133 million
of capital gains, £388 million of repayments of principal and £82 million
payment of accrued interests, for the Investment Company.

 2. Invest selectively

Our response to the slow market for mezzanine has been to generate proprietary
deals through the local reach and relationships of our local network of
investment professionals. It is testament to our origination capabilities that
we successfully invested a large amount of capital in a such a market.

We invested close to £1 billion for the full year, of which £311 million came
from our balance sheet, through new mezzanine deals and follow on investments,
as well as providing cash paying equity to finance the acquisition of a €1.4
billion senior loan portfolio from RBS, for which we created Eos Loan Fund I in
August 2010. We are one of the very few alternative asset managers with the
ability to analyse, price, manage and underwrite a transaction of this scale and
complexity and the only one to have completed such an acquisition this year.
This is due to the depth of experience in our credit team, our financial
capacity and the long-standing relationship of trust we have established with
our fund investors. Originating the opportunity would also not have been
possible without the close relationship developed over a very long time with the
vendor.

European mezzanine market
We invested in three sponsor-led mid-market European buyout transactions,
working as a partner to the sponsor to provide a blend of securities from senior
bonds to equity, for the acquisitions of Courtepaille, Quorn, and TeamSystem.
Eos Loan Fund I, Gerflor and Courtepaille represent our top three deals of the
year by size and they were sourced, structured and led by ICG.

In December ICG provided the whole debt financing structure for Courtepaille, a
fast growing grill chain in France via a €160 million unitranche (single bond)
providing the management team and private equity sponsor, Fondations Capital,
with a tailored financing solution which will give the company maximum
flexibility to continue growing and creating long term value for its
shareholders.

In the case of Quorn, the leading European meat substitute producer, ICG
provided junior debt and equity financing of £80 million to support the
acquisition of the business by Exponent Private Equity from Premier Foods. ICG
also arranged a mezzanine loan and equity investment of €120 million in support
of the acquisition of TeamSystem, an established Italian software company, by Hg
Capital.

In addition we invested into two ICG led sponsorless transactions: BaxterStorey
and Gerflor. Our relationship with Gerflor, a global PVC flooring company based
in Europe, began as a mezzanine investor in 1992, since which time we have
backed several buyouts creating significant interest income and capital gains
over the following 19 years. Given our knowledge of the company and our
confidence in the management team's business plan, we were able to invest
alongside them in a deleveraging structure to support the company's
international development strategy. We structured this transaction using
corporate senior debt giving the company a much lower cost of debt and a more
flexible framework.

Baxter Storey, a fast growing UK catering company, was purchased by its
management team with our support via the provision of a mix of mezzanine and
equity. Our ability to structure a solution that answered management's
requirement and our deep knowledge of their industry were critical factors in
closing this transaction.

US mezzanine market
The US sub-investment grade market has seen a faster recovery than the European
market. US banks have dealt with legacy loans more aggressively than their
European counterparts and therefore have a greater capacity to write new
business. The US institutional market is more mature and diverse than the
European market and, as a result, the buyout debt market in the US has become
more competitive with covenant-lite loans and dividend recapitalisations now
back at pre crisis levels.

Despite a competitive market, we have made two new investments recently
demonstrating solid progress towards our strategy to build the ICG franchise. In
August 2010, the Investment Company invested in Fort Dearborn and in May 2011
(after our year end) in Cogent-HMG, our tenth American investment.

Asia Pacific market
The Asia Pacific buyout market has continued to be active, driven primarily by
auction processes for secondary buyouts. Valuations for good businesses have
been high as a result of increased numbers of auction participants: Asian based
private equity sponsors, trade buyers and US and European sponsors with no local
presence, looking to gain a foothold in the region and access the growth in
Asia.

Bank liquidity is high, particularly from the local banks, which have not been
as badly affected by the crisis as their European counterparts, although
leverage multiples have remained reasonable at 4-4.5 times EBITDA. For known
companies and market leaders, multiples have reached 5-6 times EBITDA.

Sponsors have significant amounts of un-invested commitments from dedicated
Asian funds, and this is also driving valuations higher with increased equity
contributions. The result of these factors is that an understanding of the
equity case, and where business improvements and increased profitability can be
generated, are critical to the structuring of our investments between debt and
equity instruments.

Our response has been to leverage our relationships in the region to find
attractive investment value. We completed an add-on investment to finance an
acquisition by Link, our share registrar and pension administration investment
in Australia. In addition, in May 2011, we completed a successful exit and re-
investment in Tegel, New Zealand's leading integrated poultry producer.

We have formalised our China strategy and recently signed a strategic co-
investment partnership with CITIC Capital China Opportunities, L.P., a fund of
CITIC Capital. This strategic alliance provides superior access to deal flow in
mainland China. In the coming year we expect to be investing in mid-sized,
privately owned, Chinese companies where we see long term growth and a strong
management team.

 3. Grow the Fund Management Company

Our strategy for growing the FMC is threefold. First, increase AUM in our credit
and mezzanine funds; second, pursue acquisitions of loan portfolios and credit
fund management contracts; and third, expand judiciously into adjacent asset
classes.

AUM has grown to €11.8 billion (£10.4 billion) at 31 March 2011, up 5%.  This
includes €9.0 billion (£8.0 billion) of third party funds, up 9% principally due
to Eos Loan Fund I, which added €953 million (£840 million) of AUM, as well as
the acquisition of the St Paul's CLO I BV and the acquisition of a 51% stake in
Longbow Real Estate LLC.  The Investment Company investment book was €2.7
billion (£2.4 billion), excluding investments in our credit funds, down 7% due
to the strong realisations.

Key to increasing the AUM of the Fund Management Company is the performance of
our existing funds so as to attract new third party investors and repeat
business from current investors. All our funds continue to perform very
strongly. Our European mezzanine funds have benefited from the same improving
economic environment as our Investment Company portfolio. These funds have
generated net multiples in line with top quartile performance private equity
returns since 2000.

Our mezzanine funds have performed strongly. ICG Mezzanine Fund 2000 is almost
entirely realised and holds only one asset which we expect to realise in the
current year. The fund has generated a net money multiple of 1.7 times and a net
IRR of 18%. Its successor, ICG Mezzanine Fund 2003, shows an 18% IRR and a money
multiple of 1.5 times on exited investments and has returned over 121% of
commitments with a significant distribution in December 2010.  This fund shows a
net IRR of 15% and a net money multiple of 1.6 times. ICG European Fund 2006, is
now 92% invested and closed for new investment. It has achieved a 1.8 times
money multiple and 29% IRR on realised assets and a net money multiple and IRR
of 1.2 times and 8% overall on both realised and unrealised investments. ICG
Recovery Fund 2008 is 75% invested with no exits and a strong performance to
date: net IRR and money multiple have reached 22% and 1.2 times respectively.
ICG Minority Partners Fund 2008 is 84% invested with a 2.1 times multiple and
55% IRR on exits. Intermediate Capital Asia Pacific Fund 2005 is fully invested
and shows a net money multiple of 1.3 times and an 11% net IRR overall on both
realised and unrealised investments. Intermediate Capital Asia Pacific Fund
2008 is 26% invested and, at this early stage, performing satisfactorily.

We have also expanded our marketing and distribution team which is now ten
strong and we will continue to hire experienced marketing and distribution
professionals to strengthen our brand and investor reach in support of our
global fundraising activities in Europe, the US and Asia Pacific.
We have begun marketing our new mezzanine fund, ICG Europe Fund V, the successor
to ICG European Fund 2006. The fund will be raised over the course of 2011 and
2012 and is targeting €2 billion including a €500 million commitment from our
Investment Company.


Our credit funds have also benefited from the improved operating performance of
their underlying assets. Our 12 month senior loan default rate for the year
ended 31 March 2011 was 1.5% compared to 1.7% for the market. These funds have
benefited from the wave of exits in the buyout market as a change of ownership
triggers the repayment of outstanding loans, resulting in improving performance
ratios and a recovery in junior fees.

The ICG High Yield Bond Fund seeded by the Investment Company in late 2009 has
outperformed the market returning 14% net of fees in 2010. The ICG High Yield
Bond Fund has been set up as a UCITS 3 fund in March 2011 and is now open to
third party investors. We will continue fundraising for both our high yield and
senior secured loan funds.

The European high yield bond market grew significantly in both 2010 and 2011.
Close to a third of recent issuances are from companies which previously
financed themselves in the loan market. Given our long standing knowledge of
these companies, we believe we can build a franchise in this asset class over
time.

We continue to review potential acquisitions of management contracts of both
CLOs and loan portfolios. In December, we became the investment manager of a
€300 million CLO, having acquired the management contract of Resource Europe CLO
1 BV from Resource America, since renamed St Paul's CLO 1 BV.

Current market conditions have made these transactions less attractive at the
moment, as banks and loan fund managers have seen a recovery in performance and
have consequently increased their price expectations. For a number of European
banks, leveraged finance activity has nonetheless become non-core and it is
possible that we will see new opportunities in the future both for non core bank
loan portfolios and sub-scale funds from managers with limited access to
capital.

We want to grow ICG's product offering into adjacent asset classes through
measured expansion in new areas where our core skills, global reach and
infrastructure can create value for our fund investors and shareholders. In
December, we acquired a 51% stake in Longbow Real Estate, a UK real estate debt
specialist providing mezzanine finance to the UK commercial property market. The
combination of ICG's international platform and Longbow's expertise and track
record in real estate positions us to expand successfully into this asset class.
The transaction closed in March 2011 and we have seen good progress in both
raising capital and investing.

We will continue to pursue opportunities selectively where we can apply our
specialist skills of local origination, risk pricing and investment structuring
with a view to expanding our product range.

Outlook
We are encouraged by the steady uplift in the performance of our portfolio
throughout the year and we expect this positive trend to continue. We have
realised strong exits and we expect the exit window to remain open in the
current year providing further opportunities for ICG to realise value from the
assets held by our funds and our Investment Company.

Despite a relatively slow recovery in the core mezzanine market in Europe and
strong competition in both the US and Asia Pacific, we have demonstrated our
ability to invest in unique investment opportunities. We are seeing a steady
pipeline of potential deals and will tap local pockets of value; originate off-
market opportunities; and be innovative in our structuring. Our long held
relationships with management teams and financial partners and our local network
throughout Europe, the United States and Asia Pacific are key competitive
advantages. Our experience of helping management teams to refinance and de-lever
their balance sheets in order to invest in growth and development positions us
as an attractive partner in the mid-market.

Internally, the introduction of a new compensation scheme for our employees,
following approval by our shareholders at last year's AGM, aligns our interests
directly with both shareholders and fund investors. This scheme also allows us
to better motivate and retain our staff.

We outline in the 'Our market' section the significant investment opportunities
that we expect to emerge from a growing imbalance between supply and demand of
credit in the European buyout market. The wall of maturing European buyout debt
that requires refinancing over the next four years coincides with the expiry of
CLO re-investment periods. As banks are no longer seeking to drive growth and
CLOs, which provided the majority of buyout debt before the crisis, are
currently not economic, buyout companies will have to refinance from alternative
sources of capital.  We believe that instutional investors, via the high yield,
mezzanine and sub investment grade debt market, will form a key part of the
supply solution.

We therefore see opportunities to continue to grow our fund management business.


Financial review

ICG's business activities, together with the factors likely to affect its future
development, performance and financial position are set out in this statement.

As highlighted in this statement, ICG has had another successful year and our
portfolio, as a whole, is performing satisfactorily.

ICG's principal risks and uncertainties and how they are mitigated are
documented in this statement.

The financial position of the company, its cashflows, liquidity position and
borrowing facilities are described in this financial review.


Going Concern Statement
The directors have a reasonable expectation that the Company has adequate
resources to continue in operational existence for the foreseeable future.  Thus
they continue to adopt the going concern basis of accounting in preparing the
annual financial statements.


Definitions
We now report the profit of the Fund Management Company ("FMC") separately from
the profits generated by the Investment Company ("IC") in our segmental
reporting note.

The FMC is an operating vehicle of ICG PLC. It sources and manages investments
on behalf of the IC and third party funds. It bears the bulk of the Group's
costs including the cost of the investment network, i.e. the investment
executives and the local offices, as well as the cost of most support functions,
primarily information technology, human resources and marketing.

The IC is an investment unit of ICG PLC. It coinvests alongside third party
funds, primarily in mezzanine and growth capital assets. It is charged a
management fee of 1% of the carrying value of the investment portfolio by the
FMC. The costs of finance, treasury, and portfolio administration teams as well
as the other costs related to being a listed entity are allocated to the IC. The
cost of the Medium Term Incentive Scheme ("MTIS") is charged to the IC while
this scheme remains operational.

During the year ICG purchased a 51% stake in Longbow Real Estate, a UK real
estate debt specialist providing mezzanine finance to the UK commercial property
market.  This entity is fully consolidated into the results for the FMC for the
year with the minority stake deducted.

The Group defines its assets under management ("AUM") as the total cost of
assets owned, managed and advised by the Company plus commitments to its managed
and advised funds, in addition to debt facilities for the funds.

Return on equity ("ROE") is defined as profit after tax divided by average
shareholder funds for the year.

Cash core income is defined as profit before tax excluding fair value movement
on derivatives less net capital gains, impairments and unrealised rolled up
interest.

Pre incentive cash profit is defined as profit before tax excluding performance
related bonuses and fair value movement on derivatives, less accrued rolled up
interest plus released rolled up interest.


Overview
Group profit before tax rose 76% to £186.3 million compared to £105.8 million
last year.

The profit before tax for the FMC was £35.9 million compared to £31.1 million
last year, excluding a one off £6.9 million release of accrued cost from the
shadow share plan for our CFM team (reflecting the lower level of fee income
generated by this team). Excluding this exceptional item, the profit before tax
of the FMC has grown by 15% from the previous year.  This is primarily due to
the recovery of junior fees from our credit funds.

The profit before tax for the IC rose strongly from £67.8 million to £150.4
million. This was due to a high level of gross capital gains, which, at £132.3
million, was the third highest level of gains in our 22 year history, a decrease
of 56% in the level of impairments and resilient net interest income.

Total AUM at 31 March 2011 were £10,408 million, up 5% compared to 31 March
2010 (£9,958 million) primarily due to the establishment of the Eos Loan Fund
1, which added £842 million of third party assets under management, and the
purchase of the management contract of St Pauls CLO 1 B.V which added £259
million of assets under management.

Shareholders' funds at 31 March 2011 stood at £1,250.4 million, up £66.9 million
compared to 31 March 2010, primarily due to retained profit in the year. The
balance sheet has remained strong with a gearing ratio of 100% compared to 127%
at the end of last year.

The  balance sheet had undrawn debt facilities  of £784 million at the year end.
 At the end of April following maturity of a portion of our senior debt, undrawn
debt  facilities were  £506 million.  Given the  medium term  shortage of easily
available  bank  debt  we  remain  vigilant  about  the maturity of our debt. We
continue  to review alternative  sources of debt  capital to refresh and further
diversify  the balance sheet funding.  In addition to the  public rating of BBB-
with stable outlook from Fitch Ratings announced in January, we obtained today a
BBB-/A-3 Issuer Credit Rating with a stable outlook from Standard & Poor's.

Free cash flow prior to investments and dividends was £642.9 million, a 73%
increase on the level of last year, due to higher fee income and strong
realisations.


Profit and Loss Account

Fund Management Company
Assets under management

Total AUM at 31 March 2011 were £10,408 million, up 5% compared to 31 March 2010
(£9,958 million) due to the establishment of the Eos Loan Fund 1, which added
£842 million of third party assets under management, and the purchase of the
management contract of St Pauls I which added £259 million of AUM.  The impact
of these new funds has been partially offset by the 7% decrease in balance sheet
investments. The appreciation of Sterling versus the Euro and the US Dollar has
decreased AUM by 1%.

Third party AUM, at £7,984 million, were up 9% in the 12 months to 31 March
2011.

Mezzanine and growth capital AUM amounted to £3,058 million, down by 9%,
primarily due to the level of realisations during the year, particularly in the
ICG European Fund 2003 and the Intermediate Capital Asia Pacific Mezzanine Fund
2005.

Credit funds AUM have increased by 18% to £4,926 million due to the
establishment of the Eos Loan Fund I and the purchase of the fund management
contract from Resource Europe overall increasing AUM by £1,101 million.
 However, the overall impact of these new funds has been reduced by £390 million
as the older CFM funds continue to reduce as assets are realised. Credit Funds
AUM include £70.8 million of seed equity provided by ICG Group compared to £34.0
million at 31 March 2010, principally due to a further £35.0 million of
investment to seed our dedicated high yield fund.

Fee income
Fee income, including the IC management fee recharge, increased by 7% to £81.8
million.

Credit funds fee income was 69% higher than the previous year at £23.7 million
as a result of the recovery of junior fees.  Junior fees on certain of our funds
were switched off during the year to March 2010 due to the level of downgrades
we experienced last year, in common with the market generally.  These fees are
now all switched back on and we have recovered all back fees in full, generating
an extra £3.8 million of fee income in the year.

Mezzanine and growth capital funds fee income decreased by 6% to £32.4 million.
This was principally due to reduced income from the ICG European Fund 2003 and
the Intermediate Capital Asia Pacific Mezzanine Fund 2005, as these funds are
now in realisation mode.  In addition carried interest contribution for this
year was lower at £1.3 million compared to £2.6 million last year.  These
decreases have been partially offset by an £5.4 million increase of fee income
from ICG Recovery Fund 2008.

The average carrying value of the IC's portfolio was down 7% at £2,580 million,
generating a fee from the IC to the FMC of £25.7 million versus £27.8 million
last year.

Other income
Dividends paid from our credit funds also recovered during the year as the
underlying asset prices increased and surplus cash in the individual funds were
generated. The dividends received on the equity stakes we own in our Credit
Funds were £3.0 million, up from £1.9 million in the previous twelve months.
 Equity purchased, as part of the Resource Europe management contract purchase
was sold shortly after the year end at a profit of £1.1 million, the valuation
was therefore uplifted at the year end.

Operating expenses
Operating expenses for the FMC were £50.0 million compared to £47.2 million last
year (excluding the positive impact of the £6.9 million release in the year to
31 March 2010). Other administrative costs are £19.2 million compared to £17.9
million reflecting the recruitment costs of strengthening our distribution
capabilities. Excluding the impact of the release of £6.9 million, staff costs
were broadly flat compared to last year.

The operating margin was 43.9% compared to 40.7% (excluding the £6.9 million
release) in the previous twelve months.

Profit before tax
Excluding the impact of the £6.9 million release in the year to 31 March 2010,
profit before tax was up 15% to £35.9 million compared to £31.1 million last
year.


Investment Company
Balance sheet investments
The balance sheet investment portfolio amounted to £2,424 million down 7%
compared to 31 March 2010. This excludes £70.8 million of seed equity in our
Credit Funds and £80.6 million of debt held in our Credit Funds.

As detailed in the Business Review, the level of investments and repayments have
recovered. In the 12 months the balance sheet invested £311.0 million, of which
£64.0 million were follow-on investments. There were repayments of £388.6
million.  As a result, net repayments were £77.6 million.

In addition, the Sterling value of our portfolio was negatively impacted by the
appreciation of the currency as 68% of the portfolio is Euro denominated and 9%
is USD denominated.  Sterling denominated assets only account for 15% of the
portfolio.

The investment portfolio comprises £1,404 million of senior mezzanine and senior
debt (58%), £503 million of junior mezzanine investments (21%) and £517 million
of equity investments (21%) (excluding amounts invested in our Credit Funds).

Net interest income
Net interest income was 14% lower at £179.8 million compared to £209.7 million
last year (excluding dividend income and the impact of the fair value adjustment
of financial instruments held for hedging purposes) principally due to a lower
average portfolio over the year.

Interest income was down 14% at £235.2 million principally due to a lower
average portfolio over the year (£2.6 billion compared with £2.8 billion in the
previous year). This comprises £85.4 million of cash interest income and £149.8
million of rolled up interest.

Interest income is accrued using a discounted cash flow model in accordance with
IFRS and early repayments can generate an uplift in interest income as a result
of the shorter discount period used for the computation of the rolled up
interest. We also benefited from cash interest payments on some underperforming
assets due to our relentless effort to maximise recoveries.

Interest expense was down 11% at £55.4 million (excluding the impact of the fair
value adjustment of financial instruments held for hedging purposes) due to
lower net debt.

Dividend income from portfolio companies was £3.8 million in the last twelve
months compared to dividend income of nil in the previous 12 months.

Fair value movements of financial instruments held for hedging purposes resulted
in a £3.8 million negative adjustment this year compared to a £0.1 million
positive adjustment last year.

Other income
Other income, principally waiver and early repayment fees, was £7.2 million
compared to £3.4 million in the previous 12 months.

Operating expense
Operating expenses were up by 10% at £67.0 million from £60.7 million last year.
 Staff costs have increased from £2.3 million to £9.1 million as the costs of
the awards in the year under the new remuneration schemes have been charged this
year.  Operating expenses also include a £5.7 million cost relating to an
onerous lease provision for 20 Old Broad Street following our move to new
premises. As a consequence our rental costs will be reduced by £0.6 million a
year on average for the next ten years. This has no material impact on a cash
basis.

The Medium Term Incentive Scheme ("MTIS") charged on rolled up interest accruals
for the year, amounted to £22.8 million compared to £28.9 million last year.
This scheme is closing in March 2012, therefore the amount expected to be paid
out before the scheme closes is reducing.

The management fee on balance sheet investments (£25.7 million compared to £27.8
million) has reduced due to the lower average value of the portfolio.

Capital gains
The acceleration in realisations that we saw in the second half of FY10
continued and capital gains for the twelve months to 31 March 2011 were very
strong at £132.3 million up 33% compared to last year.  The largest contributors
to capital gains were Visma, Sebia, Picard, Pasteur Cerba, TeamSystem,
Eurofarad, Gerflor, Behavioral Interventions, Loyalty Partners and TBC.

This £132.3 million also includes £3.1 million of unrealised gains on the equity
we hold in Aster and Tegel, which were recently sold to Liberty Global and
Affinity Partners respectively. The Aster transaction is expected to complete in
May, subject to regulatory approvals. The Tegel transaction completed in early
May.

Impairments
Gross provisions for portfolio companies were 50% lower at £89.8 million
compared to £180.3 million last year. Recoveries on past provisions were
materially higher in the second half at £17.8 million compared to £1.1 million
in the first half, resulting in a £18.9 million recovery for the year.  We wrote
back our provisions on four of our investments which saw a strong operational
recovery during the year.

Net impairments for the 12 months to 31 March 2011 were therefore 56% lower at
£70.9 million compared to £161.8 million at 31 March 2010.

Profit before tax
Profit before tax for the IC was up by 122% to £150.4 million compared to of
£67.8 million in the 12 months to 31 March 2010.


Group
Profit before tax
Group profit before tax was up by 76% to £186.3 million compared to a profit of
£105.8 million last year.

Profit after tax, ROE, earnings per share
Group profit after tax is £128.1 million compared with £81.7 million in the
previous year.
The Group generated a ROE of 10.8% compared to 7.2 % in the 12 months to 31
March 2010.

Earnings per share for the 12 months to 31 March 2011 were 32.6p compared to
25.0p last year (adjusted for the rights issue in July 2009). The weighted
average number of shares for the year was 393,785,735.

Dividend per share and cash profit measures
Cash core income was maintained at a high level of £106.7 million. The Board has
recommended a final dividend of 12 pence per share. This would result in a full
year dividend of 18 pence per share, an increase of 6% on the prior year.

In order to continue to offer flexibility to shareholders, the company will
maintain the scrip dividend scheme introduced last year. This scheme allows
shareholders to elect to receive dividends in shares in lieu of cash.

Pre-incentive cash profit was £191.2 million.


Group Cash Flow
Operating Cash Flow
Interest income received during the reported financial year was up 3% to £174
million as the lower level of cash interest income was more than offset by a
higher level of rolled up interest realisations. Over the year the realisation
of rolled up interest was £82.2 million compared to £65.7 million last year.
Interest expense was materially lower at £43.9 million compared to £82.7 million
due to the one-off payment to extend the debt facilities last year together with
a lower level of average net debt. Dividend income was considerably higher at
£5.7million compared to £1.9 million in the previous year.  Third party fee
income received amounted to £77.9 million as junior fees on the CFM funds were
recovered in full. Operating expenses were £80.9 million as we returned to
paying bonuses to staff.

Operating cash flow for the 12 months to 31 March was up 47%, at £132.8 million.

Cash Flow relating to Capital Gains
Cash flow from capital gains was £146.6 million, up from £79.3 million in the
previous year on the back of a return to realisations.

Free Cash Flow
Tax expense paid was only £5.1 million due to the impact of the large losses
realised in the year to 31 March 2009 which were carried forward. Following
repayments, syndication proceeds and recoveries of £368.6 million, free cash
flow prior to investments and dividends was £642.9 million, a 73% increase on
the level of last year.

Movement in net debt and cash balances
These financed investments of £315.9 million and a reduction in net debt of
£286.4 million. Dividend payments amounted to £40.6 million, given the high take
up of scrip dividend.


Group Balance Sheet
Capital Position
Shareholders' funds at 31 March 2011 stood at £1,250.4 million, up 5% compared
to 31 March 2010, primarily due to the increase in retained earnings during the
year.

Net debt was £1,248.6 million at 31 March 2011 down 17% from last year.

Net debt to shareholder funds at year end was 100%, down from 127% at the end of
last year as a result of the capital gains and realisations.

Investment capacity
Total debt facilities stood at £2,033 million at 31 March 2011, including
undrawn debt facilities of £784 million.

£216 million of bank debt and £101 million of private placements are maturing in
the current financial year and £438 million matures in April 2012.

In May 2010, we extended a further £67 million of debt in addition to the £545
million we extended in July 2009.


Financial outlook
For the FMC, fee income is expected to be broadly stable as the partial
contribution from ICG European Fund V should compensate for the catch up on
junior fees included in this year's fee income. The new compensation schemes are
expected to continue to allocate a greater proportion of our incentive scheme
costs to the FMC.

The IC will be negatively affected by a lower level of net interest income as a
result of the good realisations achieved which we expect to continue in the
current year. This, however, should result in further capital gains. Impairments
are expected to be lower given the improvement in performance across our
investment portfolio.
Principal risks and uncertainties
Risk management is the responsibility of the ICG Board, which has put in place
the following risk management structures:

Commitees of Executives
The Executive Committee comprises the four Managing Directors of ICG, who each
have a specific area of responsibility. The Executive Committee has general
responsibility for ICG's resources, strategy, financial and operational control
and managing the business worldwide.

The Mezzanine and Minority Equity Investment Committee is chaired by Christophe
Evain, CEO and Chief Investment Officer (CIO). The Chairman selects up to seven
members among two pre-defined lists of senior investment professionals including
Managing Directors and senior members of the Mezzanine and Growth Capital
business. One of these members will be nominated as a Sponsor member, to reflect
the specificities of the investment (geography, size, nature of the
transaction). The committee members are responsible for reviewing and approving
all investment proposals presented by investment executives in accordance with
the Investment Policy set by the Board. The approval of the Board is required
for large investments. The Mezzanine and Growth Capital Investment Committee
also reviews and manages potential and actual conflicts of interest, reviews
quarterly performance reports of our portfolio companies, and coordinates
management plans for individual assets as necessary.

The Credit Funds Investment Committee is chaired by Christophe Evain, CEO and
CIO. The Chairman selects up to five members among two pre-defined lists of
senior investment professionals including Managing Directors and senior members
of the Credit Funds Management team. One of these members will be nominated as
Sponsor member, depending on the specificities of the investment (geography,
size, nature of the transaction). The committee members are responsible for
reviewing and approving all investment proposals presented by credit executives
in accordance with the Investment Policy. The Credit Funds Investment Committee
also reviews and manages potential and actual conflicts of interest, reviews the
quarterly performance reports of our Credit funds' portfolio companies, and
coordinates management plans for individual assets as necessary.

By chairing both investment committees, the CIO ensures the Company's Global
Investment Strategy is applied consistently across the firm.

The  Treasury Committee  comprises six  members including  the CFO and Financial
Controller  and is responsible for ensuring compliance with the Group's Treasury
Policy,  reporting  any  breach  of  policy  to  the Audit Committee, monitoring
external  bank  debt  and  bank  covenants,  approving  and  monitoring  hedging
transactions and approving the Group's list of relationship banks.

The Legal and Compliance Department is responsible for ensuring that business is
conducted in accordance with relevant regulatory and legal frameworks and
internal policies of the Group.

Non-Executive Commitees
The Audit and Risk Committee comprises four independent Non-Executive Directors.
The Chairman of the Board as well as the members of the Executive Committee are
invited to attend, but are not members of the Committee. The Company's auditors
are also invited to attend and have direct access to Committee members. The
Committee is responsible for the selection, appointment, and review of the
external auditors to the Board; reviewing accounts; the oversight of the
investment portfolio; and monitoring the effectiveness of the internal control
environment and the risk management systems of the Group.

The  Remuneration Committee  consists of  four Non  Executive Directors  and the
Chairman.  Executive Directors are not members of the Remuneration Committee but
are  normally invited  to attend  except when  the committee is discussing their
remuneration.  The Committee is responsible  for the overall remuneration policy
for  all ICG staff and ensures  that the remuneration arrangements promote sound
and  effective risk management and  are in line with  tht long term interests of
the company. The Committee determines the level of remuneration of the Executive
Directors and reviews the remuneration of senior management.

Our key risks, and the ways in which we mitigate them are outlined on the
following pages.


Business Risks

Credit Risk

The performance of the Group's funds and investment portfolio is affected by a
number of factors. The group may experience poor investment performance (both in
absolute terms and relative to the performance of portfolios managed by
competitors and relative to other asset classes) due to the failure of
strategies implemented in managing the portfolio assets.

The amount of assets under management and the performance of the investment
portfolio may also be affected by matters beyond the Group's control, including
conditions in the domestic and global financial markets and the wider economy,
such as the level and volatility of bond prices, interest rates, exchange rates,
liquidity in markets, credit spreads, margin requirements, the availability and
cost of credit and the responses of governments and regulators to these economic
and market conditions. Adverse movements in any of the global conditions
described above could result in losses on investments from the Group's own
balance sheet in the investment portfolio and reduced performance fees received
on third party funds, all of which, individually or taken together, could have a
material adverse effect on the business, financial condition, results of
operations and/or prospects of the Group.

Mitigation: ICG has a disciplined investment policy and all investments are
selected and regularly monitored by the Group's Investment Committees. ICG
limits the extent of credit risk by diversifying its portfolio assets by sector,
size and geography.

The majority of third party funds currently managed by the Group are not marked
to market and, therefore, market valuations have limited immediate impact on the
amount of assets under management.

Fund Raising Risk

The Group may be unable to raise future investment funds from third parties.

This could limit the Group's capacity to grow AUM and could decrease the Group's
income from management, advisory and performance fees and carried interest. The
Groups ability to raise investment funds from third parties depends on a number
of factors, including the appetite of investors, the general availability of
funds in the market and competitor fundraising activity. Certain factors, such
as the performance of financial markets or the asset allocation rules or
regulations to which such third parties are subject, could inhibit or restrict
the ability of certain third parties to provide the Group with investment funds
to manage or invest in the asset classes in which the Group invests. In
addition, if the Group is unable to increase its assets under management, the
level of the Group's return from management, advisory and performance fees and
carried interest may be reduced. Furthermore, loss of investor confidence in the
Group or in the alternative investment sector generally, whether because of
changes in investor risk appetite, investor liquidity requirements, regulatory
and fiscal changes, poor relative or absolute performance of the Group's
investment or alternative investment funds generally, or for any other reason,
could lead to an adverse impact on the Group's performance or financial
position.

Mitigation: ICG has a long track record in developing credit related investment
products for institutional investors. The Group has built a dedicated fund
raising team to grow and diversify its institutional client base by geography
and type.

Liquidity and Funding Risk

Liquidity and funding risk is the risk that ICG will be unable to meet its
financial obligations as they fall due because assets held cannot be realised.

The level of repayments on the Group's loan portfolio and consequently on the
realisation of rolled up interest as well as delays in realising minority
interests could have a negative impact on the Group's investment capacity. In
addition, there can be no assurance that the Group will be able to secure
borrowings or other forms of liquidity in the longer term on commercially
acceptable terms or at all. Failure to secure borrowings or other forms of
liquidity on commercially acceptable terms may adversely affect the Group's
business and returns. The Group's ability to borrow funds or access debt capital
markets in the longer term is dependent on a number of factors including credit
market conditions. Adverse credit market conditions may make it difficult for
the Group to refinance existing credit facilities as and when they mature or to
obtain debt financing for new investments. In addition, the cost and terms of
any new or replacement facilities may be less favourable and may include more
onerous financial covenants. Failure to secure borrowings on commercially
acceptable terms or a default by the Group under its debt agreements may have a
material adverse effect upon the Group's financial condition and results.

Mitigation: The Group maintains a diversified portfolio of investments in order
to minimise the risk that a significant proportion of its assets would face
concurrent adverse conditions for repayments and realisations. In addition the
Group maintains a prudent funding strategy. It is our policy to maintain diverse
sources of medium term finance and to ensure that we always have sufficient
committed but unutilised debt facilities.


Market Risks

Risks relating to the Group and its business
General market conditions

The Group's strategy and business model are based on an analysis of and
assumptions regarding its operating environment. This includes market
evaluations and the identification and assessment of external and internal risk
factors. Significant unexpected changes or outcomes, beyond those factored into
the Group's strategy and business model may occur which could have an adverse
impact on the Group's performance or financial position.

Mitigation: The Executive Committee regularly reviews the likely impact of
potential changes in the operating environment, seeking when appropriate advice
from external experts.

Interest rate risk

The Group and some of the Group's portfolio companies are exposed to
fluctuations in interest rates which could adversely affect the Group's returns.

The Group has a mixture of fixed and floating rate assets, which are funded with
a mixture of equity and borrowings.  A failure to match borrowings by type or
maturity or the failure or inappropriate use of derivative financial instruments
for the purpose of hedging could have an adverse impact on the Group's returns
and financial condition. In addition, many of the Group's portfolio companies
rely on leverage to finance their business operations and increase the rate of
return on their equity. Investments in highly leveraged entities are inherently
more sensitive to interest rate movements. Therefore, a significant increase in
interest rates could adversely affect the returns and financial condition of the
Group's portfolio companies and may even lead to some of the Group's portfolio
companies breaching financial or operating covenants in their credit agreements
or default on their debt.

Mitigation: The Group seeks to minimise interest rate exposure by matching the
type, maturity and currency of its borrowings to those of a group of assets with
a similar anticipated holding period. The Group's Investment Committees take
into account the ability of each portfolio company to successfully operate under
a different interest rate environment both before validating the investment and
during the life of the investment.

Foreign exchange risk

The Group is exposed to fluctuations in exchange rates which could adversely
affect the Group's returns and financial condition.

The Group reports in Sterling and pays dividends from Sterling profits. The
underlying assets in the Group's portfolio are principally denominated in Euros,
and to a lesser degree in US dollars and other currencies. Therefore, changes in
the rates of exchange of these currencies may have an adverse effect on the
value of the Group's investments and any undrawn amount of the Group's debt
facilities.  Although the Group has in place measures to mitigate the foreign
exchange risk on its assets and liabilities, to the extent that any structural
currency exposures are unhedged or unmatched, such exposure could adversely
affect the Group's returns and financial condition. Failure by a counterparty to
make payments due under derivative financial investments may reduce the Group's
returns.

Mitigation: The Group seeks to reduce structural currency exposures by matching
loans and investment assets denominated in foreign currency with borrowings or
synthetic borrowings in the same currency. In addition, the Group has used and
continues to use derivative financial instruments and other instruments on a
limited basis, as part of its foreign exchange risk management, to hedge a
proportion of unrealised income recognised on a fair value basis. The Group
spreads its derivative contracts across a number of counterparties and regularly
evaluates the counterparty risk.  The Group seek to transact only with sound
financial institutions.

Operational Risk

Loss of Staff

If the Group cannot retain and motivate its senior investment professionals and
other key employees, the Group's business could be adversely affected.

The Group's continued success is highly dependent upon the efforts of the
Group's investment professionals and other key employees. The Group's future
success and growth depends to a substantial degree on the Group's ability to
retain and motivate key employees, the market for whom is very competitive. The
Group may be unable to retain such key employees or to continue to motivate
them.

The Group's investment professionals possess substantial experience and
expertise in investing and are responsible for locating, executing and
monitoring the Group's investments. The loss of even a small number of the
Group's investment professionals could jeopardise the Group's ability to source,
execute and manage investments as well as affect recoveries on troubled assets,
which could have a material adverse effect on the Group's business.

Mitigation: The Group attempts to reward its investment professionals and other
key employees in line with market practice.  In 2009 the Group's Remuneration
Committee commissioned PriceWaterHouseCoopers to review the compensation
structure of ICG and to advise upon appropriate benchmarking against which
remuneration could be set.  Following this review, new remunerations schemes
were approved by shareholders at last year's AGM.  These schemes are aligned
with the Groups' strategy and in line with the appropriate benchmark and comply
with the new UK Financial Services Authority ("FSA") remuneration code.

Regulatory risk

Changes to the regulatory frameworks under which the Group operates or a breach
of applicable regulations could damage the Group's reputation and affect the
Group's compliance costs, returns and financial condition

The Group operates in numerous jurisdictions and its business, particularly the
fund management part of the business, is subject to numerous regulatory regimes,
including the United Kingdom, the United States, Hong Kong, Ireland and
Luxembourg. The FSA is the Group's primary regulator. The FSA and other such
regulatory authorities have broad regulatory powers dealing with all aspects of
financial services, including the authority to grant, and in specific
circumstances to vary or cancel, permissions and to regulate marketing and sales
practices, advertising and the maintenance of adequate financial resources.

If the Group were to breach any such laws or regulations it would be exposed to
the risk of investigations, fines, temporary or permanent prohibition from
engaging in certain activities, suspensions of personnel or revocation of their
licenses and suspension or termination of the regulatory permissions to operate.

Mitigation: The Group has a governance structure in place supported by a risk
framework that allows for the identification, control, and mitigation of
material risks faced by the Group. The adequacy of controls in place is
periodically assessed. This includes a tailored risk-based monitoring programme
designed to specifically address regulatory and reputational exposure.

Business Interruption

Operational risks may disrupt the Group's business, result in losses or damage
the Group's reputation

The Group relies heavily on its financial, accounting and other data processing
systems. If any of these systems do not operate properly or are disabled, the
Group could suffer financial loss, disruption of business and damage to its
reputation.

Mitigation: The Group has in place business processes and procedures covering
information security, change management, business continuity and disaster
recovery, aimed at ensuring that its systems can be rebuilt in the event any of
its premises suffer a disaster.
In addition, the Group maintains a system of internal controls designed to
detect, amongst other things, fraud by the Group's employees, agents and
counterparties.


Responsibility Statement

The responsibility statement below has been prepared in connection with the
Company's full annual report for the year ending 31 March 2011. Certain parts
thereof are not included within this announcement.
We confirm that to the best of our knowledge:
(a) this statement, prepared in accordance with IFRS as adopted by the European
Union, give a true and fair view of the assets, liabilities, financial position
and profit or loss of the Company and the undertakings included in the
consolidation taken as a whole; and
(b) this statement, includes a fair view of the development and the performance
of the business and the position of the Company and the undertakings included in
the consolidation taken as a whole, together with a description of the principal
risks and uncertainties they face.
This responsibility statement was approved by the board of directors on 24 May
2011 and is signed on its behalf by
By order of the Board,

Justin Dowley
Chairman

Philip Keller
CFO

1 June 2011

Consolidated Income Statement
for the year ended 31 March 2011


                                                             Year        Year
                                                            ended       ended
                                                         31 March    31 March
                                                             2011        2010
                                                               £m          £m
                                                      (Unaudited)   (Audited)
------------------------------------------------------------------------------
 Interest and dividend income                               242.0       274.1

 Gains on investments                                       133.4        98.8

 Fee and other operating income                              63.3        52.0
------------------------------------------------------------------------------
                                                            438.7       424.9

 Interest payable and other related financing costs        (59.2)      (62.4)

 Provisions for impairment of assets                       (70.9)     (161.8)

 Administrative expenses                                  (122.3)      (94.9)
------------------------------------------------------------------------------
 Profit before tax                                          186.3       105.8

 Tax expense                                               (58.2)      (24.1)
------------------------------------------------------------------------------
 Profit for the year                                        128.1        81.7
------------------------------------------------------------------------------


 Attributable to:
 Equity holders of the parent                               128.2        81.7

 Non-controlling interests                                  (0.1)           -
------------------------------------------------------------------------------
                                                            128.1        81.7
------------------------------------------------------------------------------

------------------------------------------------------------------------------
 Earnings per share                                         32.6p       25.0p
------------------------------------------------------------------------------
 Diluted earnings per share                                 32.5p       25.0p
------------------------------------------------------------------------------

All activities represent continuing operations
Consolidated Statement of Comprehensive Income
for the year ended 31 March 2011

                                                                  Year      Year
                                                                 ended     ended
                                                              31 March  31 March
                                                                  2011      2010
                                                                    £m        £m
                                                           (Unaudited) (Audited)
--------------------------------------------------------------------------------
Profit for the year                                              128.1      81.7

Available for sale financial assets:

Gains arising in the year                                        110.1      87.4

Less: Reclassification adjustment for gains included in
profit and loss                                                (120.6)    (64.6)

Exchange differences on translation of foreign operations        (1.5)     (1.7)
--------------------------------------------------------------------------------
                                                                (12.0)      21.1

Tax on items taken directly to or transferred from equity          3.6     (6.3)
--------------------------------------------------------------------------------
Other comprehensive (expense)/income for the year                (8.4)      14.8
--------------------------------------------------------------------------------
Total comprehensive  income for the year                         119.7      96.5
--------------------------------------------------------------------------------
Consolidated Statement of Financial Position
as at 31 March 2011
                                       As at 31 March 2011   As at 31 March 2010
                                                          £m                  £m
                                                 (Unaudited)           (Audited)

--------------------------------------------------------------------------------
Non current assets
--------------------------------------------------------------------------------
Intangible assets                                        9.1                   -

Property, plant and equipment                            7.0                 7.6

Financial assets: loans investments
and warrants                                         2,575.1             2,718.1

Derivative financial instruments                        12.0                21.4
--------------------------------------------------------------------------------
                                                     2,603.2             2,747.1
--------------------------------------------------------------------------------
Current assets

Trade and other receivables                             51.3                56.0

Financial assets: loans and
investments                                             39.7                 8.9

Derivative financial instruments                         2.3                 9.8

Cash and cash equivalents                              140.9                83.7
--------------------------------------------------------------------------------
                                                       234.2               158.4
--------------------------------------------------------------------------------
Total assets                                         2,837.4             2,905.5
--------------------------------------------------------------------------------
Equity and reserves

Called up share capital                                 79.8                78.0

Share premium account                                  665.7               642.5

Capital redemption reserve                               1.4                 1.4

Treasury reserve                                      (23.8)               (2.8)

Other reserves                                          36.8                35.2

Retained earnings                                      490.3               429.2
--------------------------------------------------------------------------------
Equity attributable to owners of the
Company                                              1,250.2             1,183.5
--------------------------------------------------------------------------------
Non-controlling interest                                 0.2                   -
--------------------------------------------------------------------------------
Total equity                                         1,250.4             1,183.5
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
Non current liabilities
--------------------------------------------------------------------------------
Trade and other payables                                 4.5                   -

Financial liabilities                                1,060.7             1,381.8

Derivative financial instruments                         8.2                22.4

Deferred tax liabilities                                12.7                32.3
--------------------------------------------------------------------------------
                                                     1,086.1             1,436.5
--------------------------------------------------------------------------------
Current liabilities

Trade and other payables                               196.9               166.5

Financial liabilities                                  175.2                93.6

Liabilities for current tax                             70.5                 0.5

Derivative financial instruments                        58.3                24.9
--------------------------------------------------------------------------------
                                                       500.9               285.5
--------------------------------------------------------------------------------
Total liabilities                                    1,587.0             1,722.0
--------------------------------------------------------------------------------
Total equity and liabilities                         2,837.4             2,905.5
--------------------------------------------------------------------------------
Consolidated Statement of Cash Flows
for the year ended 31 March 2011
                                                    Year ended    Year ended
                                                 31 March 2011 31 March 2010
                                                            £m            £m
                                                   (Unaudited)     (Audited)

----------------------------------------------------------------------------
Net cash from operating activities

Interest receipts                                        174.0         168.3

Fee receipts                                              77.9          52.4

Dividends received                                         5.7           1.9

Gain on disposals                                        146.6          79.3

Interest payments                                       (43.9)        (82.7)

Cash payments to suppliers and employees                (80.9)        (48.2)

Payment for purchase of current financial assets        (20.0)        (18.6)

Purchase of loans and investments                      (305.7)        (96.7)

Proceeds from sale of loans and investments              388.6         235.9
----------------------------------------------------------------------------
Cash generated from operations                           342.3         291.6

Taxes paid                                               (5.1)        (14.5)
----------------------------------------------------------------------------
Net cash generated  from operating activities            337.2         277.1
----------------------------------------------------------------------------
Investing activities

Purchase of property, plant and equipment                (2.5)         (1.5)

Purchase of intangibles                                  (5.1)             -

Acquisition of subsidiary                                (2.6)             -
----------------------------------------------------------------------------
Net cash used in investing activities                   (10.2)         (1.5)
----------------------------------------------------------------------------
Financing activities

Dividends paid                                          (40.6)        (37.8)

Decrease in long term borrowings                       (223.8)       (502.7)

Net cash flow from derivative contracts                   14.6        (25.4)

Purchase of own shares                                  (16.9)         (2.7)

Proceeds on issue of shares less issue costs                 -         351.4
----------------------------------------------------------------------------
Net cash used in financing activities                  (266.7)       (217.3)
----------------------------------------------------------------------------
Net increase in cash                                      60.3          58.3

Cash and cash equivalents at beginning of year            83.7          23.7
----------------------------------------------------------------------------
Effect of foreign exchange rate changes                  (3.1)           1.7
----------------------------------------------------------------------------
Cash and cash equivalents at end of year                 140.9          83.7
----------------------------------------------------------------------------

Consolidated Statement of Changes in Equity

for the year ended 31 March 2011

                                          Reserve
                                 Capital      for Available
                              redemption    share  for sale                                 Non
                Share   Share    reserve    based        or    Own Retained         Controlling
              capital premium       fund payments   reserve shares earnings   Total    Interest   Total
                   £m      £m         £m       £m        £m     £m       £m      £m          £m      £m
-------------------------------------------------------------------------------------------------------
Balance at
31 March 2010    78.0   642.5        1.4      4.6      30.6  (2.8)    429.2 1,183.5           - 1,183.5
-------------------------------------------------------------------------------------------------------
Profit for
the year            -       -          -        -         -      -    128.2   128.2       (0.1)   128.1

AFS financial
assets              -       -          -        -    (10.5)      -        -  (10.5)           -  (10.5)

Exchange
differences
on
translation
of foreign
operations          -       -          -        -                -    (1.5)   (1.5)           -   (1.5)

Tax relating
to components
of other
comprehensive
income              -       -          -        -       3.6      -        -     3.6           -     3.6
-------------------------------------------------------------------------------------------------------
Total
comprehensive
income for
the year            -       -          -        -     (6.9)           126.7   119.8       (0.1)   119.7
-------------------------------------------------------------------------------------------------------
Own shares
acquired in
the year            -       -          -        -           (21.0)        -  (21.0)           -  (21.0)

Acquisition
of non-
controlling
interest with
a change in
control             -       -          -        -                -        -       -         0.3     0.3

Script
dividend          1.8    23.2          -        -                -        -    25.0           -    25.0

Credit for
equity
settled share
schemes             -       -          -      8.5                -        -     8.5           -     8.5

Dividends
paid                -       -          -        -                -   (65.6)  (65.6)           -  (65.6)
-------------------------------------------------------------------------------------------------------
Balance at
31 March 2011    79.8   665.7        1.4     13.1      23.7 (23.8)    490.3 1,250.2         0.2 1,250.4
-------------------------------------------------------------------------------------------------------




-----------------------------------------------------------------------------------
                                          Reserve
                                 Capital      for Available
                              redemption    share  for sale
for the year    Share   Share    reserve    based        or    Own Retained
ended 31      capital premium       fund payments   reserve Shares earnings   Total
March 2010         £m      £m         £m       £m        £m     £m       £m      £m
-----------------------------------------------------------------------------------
Balance at
31 March 2009    17.3   348.5        1.4      9.6      14.1      -    384.6   775.5
-----------------------------------------------------------------------------------
Profit for
the year            -       -          -        -         -      -     81.7    81.7

Available for
sale
investments         -       -          -        -      22.8      -        -    22.8

Exchange
differences
on
translation
of foreign
operations          -       -          -        -         -      -    (1.7)   (1.7)

Tax relating
to components
of other
comprehensive
income              -       -          -        -     (6.3)      -        -   (6.3)
-----------------------------------------------------------------------------------
Total
comprehensive
income for
the year            -       -          -        -      16.5      -     80.0    96.5
-----------------------------------------------------------------------------------
Proceeds from
rights issue     60.4   291.0          -        -         -      -        -   351.4

Own shares
acquired in
the year            -       -          -        -         -  (2.8)        -   (2.8)

Script
dividend          0.3     3.0          -        -         -      -        -     3.3

Credit for
equity
settled share
schemes             -       -          -      0.7         -      -        -     0.7

Amortisation
of lapsed
options             -       -          -    (5.7)         -      -      5.7       -

Dividends
paid                -       -          -        -         -      -   (41.1)  (41.1)
-----------------------------------------------------------------------------------
Balance at
31 March 2010    78.0   642.5        1.4      4.6      30.6  (2.8)    429.2 1,183.5
-----------------------------------------------------------------------------------
Financial Information
The financial information set out in the announcement does not constitute the
company's statutory accounts for the years ended 31 March 2011 or 2010. The
financial information for the year ended 31 March 2010 is derived from the
statutory accounts for that year which have been delivered to the Registrar of
Companies. The auditors reported on those accounts; their report was
unqualified, did not draw attention to any matters by way of emphasis without
qualifying their report and did not contain a statement under s498(2) or (3)
Companies Act 2006. The audit of the statutory accounts for the year ended 31
March 2011 is not yet complete. These accounts will be finalised on the basis of
the financial information presented by the directors in this preliminary
announcement and will be delivered to the Registrar of Companies following the
company's annual general meeting.

The consolidated statement of financial position for 2010 has been restated to
include a reclassification of financial liabilities from non-current to current.
This amounts to £27.2 million and has been reclassified to reflect the maturity
profile of the revolving credit facility included within this balance.

Business and geographical segments

Definitions of our business segments are shown in the Financial Review.


--------------------------------------------------------------------------------
Year ended 31 March     Mezzanine Fund           Credit  Fund Total FMC IC Total
2011 £m (Unaudited)       Management               Management
                   ------------------------
                    Europe Asia     US
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
External fund management fee income       25.1 7.3 0.0 23.7   56.1      -   56.1

Fee income from Balance Sheet (Inter-
segment income)                           20.7 2.3 1.3  1.4   25.7      -   25.7
--------------------------------------------------------------------------------
Fund management fee Income                45.8 9.6 1.3 25.1   81.8      -   81.8

Net interest income^                                             -  179.8  179.8

Dividend income                                                3.0    3.8    6.8

Other fee income                                                 -    7.2    7.2

Staff costs                                                 (30.8)  (9.1) (39.9)

Medium Term Incentive Scheme                                     - (22.8) (22.8)

Balance Sheet fee income charge (inter-
segment expense)                                                 - (25.7) (25.7)

Administrative costs                                        (19.2)  (9.4) (28.6)

Net gains on investments                                       1.1  101.3  102.4

Impairments                                                      - (70.9) (70.9)

Add back net fair value gain on
derivatives
held for hedging purposes^                                       -  (3.8)  (3.8)
--------------------------------------------------------------------------------
Profit before tax                                             35.9  150.4  186.3
--------------------------------------------------------------------------------



^ Net gain relating to movements in the fair value of derivatives used to hedge
certain liabilities of the Group, excluding any interest accruals and spot F/X
translation movements on these derivatives, are not considered part of net
interest income for segmental reporting.

--------------------------------------------------------------------------------
Year ended 31        Mezzanine Fund              Credit  Fund Total FMC IC Total
March 2010 £m          Management                  Management
                ------------------------
                 Europe Asia     US
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
External fund management fee income    26.6 8.0   -  14.0   48.6       -    48.6

Fee income from Balance Sheet (Inter-
segment income)                        23.4 2.2  1.3  0.9   27.8       -    27.8
--------------------------------------------------------------------------------
Fund management fee Income             50.0 10.2 1.3 14.9   76.4       -    76.4

Net interest income^                                               209.7   209.7

Dividend income                                              1.9       -     1.9

Other fee income                                             -       3.4     3.4

Staff costs                                               (22.4)   (2.3)  (24.7)

Medium Term Incentive Scheme                                 -    (28.9)  (28.9)

Balance Sheet fee income charge
(Inter- segment expense)                                     -    (27.8)  (27.8)

Administrative costs                                      (17.9)   (1.7)  (19.6)

Net gains on investments                                       -    77.1    77.1

Impairments                                                  -   (161.8) (161.8)

Add back net fair value gain on
derivatives
held for hedging purposes^                                   -       0.1     0.1
--------------------------------------------------------------------------------
Profit before tax                                           38.0    67.8   105.8
--------------------------------------------------------------------------------
^ Net gain relating to movements in the fair value of derivatives used to hedge
certain liabilities of the Group, excluding any interest accruals and spot F/X
translation movements on these derivatives, are not considered part of net
interest income for segmental reporting.

Balance Sheet Investments

The balance sheet investment portfolio amounted to £2,424 million. This excludes
£70.8 million of seed equity in our Credit Funds and £80.6 million of debt held
in our Credit Funds. The investment portfolio includes £517million of equity
investments.

Top 20 assets at 31 March 2011
The top 20 assets account for 52% of the balance sheet investment portfolio and
are listed below.

Company              Country   Industry                Investment  year   £m*
-------------------------------------------------------------------------------
Medi Partenaires     France    Healthcare                    2007        107.5

Bureau Van Dijk      Belgium   Publishing & Printing         2007        99.2

Elis V               France    Business services             2007        93.9

BAA                  UK        Shipping & transport          2006        91.3

Applus+              Spain     Business services             2007        81.5

Attendo              Sweden    Healthcare                    2007        76.1

Biffa                UK        Waste management              2008        76.0

Materis              France    Building Materials            2006        65.5

Veda                 Australia Financial services            2008        59.6

CPA                  UK        Business services             2010        52.8

Link Market Services Australia Financial services            2007        51.0

Minimax              Germany   Electronics                   2006        50.6

Gerflor              France    Building Materials            2011        49.1

Ethypharm            France    Pharmaceuticals               2007        46.5

SAG                  Germany   Utilities                     2008        45.8

Eos                  UK        Financial services            2010        45.0

Feu Vert             France    Motors                        2007        41.1

Orizonia             Spain     Leisure & entertainment       2006        40.8

Eismann              Germany   Food retailing                2007        40.5

TeamSystem           Italy     Business services             2010        36.7
-------------------------------------------------------------------------------
Total assets                                                            1,250.5
-------------------------------------------------------------------------------
*carrying value on ICG balance sheet at 31 March 2011.  Includes equity stake
listed below when relevant.

Top 10 equity assets at 31 March 2011

The top 10 equity positions (included in the above table) account for 10% of the
balance sheet investment portfolio and 48% of our equity portfolio and are
listed below.

Company                  Country       Industry           Investment  year  £m*
--------------------------------------------------------------------------------
CPA                      UK            Business services        2010       44.3

Gerflor                  France        Building Materials       2011       32.1

Intelsat                 North America Telephone networks       2008       31.8

Eismann                  Germany       Food retailing           2007       24.5

Allflex                  UK            Business services     1998,2007     23.5

Acromas Holdings (AA
Saga)                    UK            Financial services       2007       23.2

TeamSystem               Italy         Business services        2010       20.2

Applus+                  Spain         Business services        2007       19.1

Mennisez                 France        Food manufacturing       2006       15.3

Link Market Services     Australia     Financial services       2007       14.6
--------------------------------------------------------------------------------
Total assets                                                               248.6
--------------------------------------------------------------------------------
*carrying value on ICG balance sheet at 31 March 2011


Timetable

The major timetable dates are as follows:
 Notices of Annual General Meeting                    20 June 2011

 Annual General Meeting                               19 July 2011

 Ex dividend date                                     13 July 2011

 Record date for Financial Year 2011 final dividend   15 July 2011

 IMS for the three months to 30 June 2011 and AGM     19 July 2011

 Payment of final dividend                            19 August 2011

 Interim results announcement
 for the six months to 30 September 2011              22 November 2011



Internet website

The  Company's  website  address  is  www.icgplc.com.  Copies  of the Annual and
Interim  Reports and other  information about the  Company are available on this
site.


Company information

 Stockbrokers                     Auditors

 J.P. Morgan Cazenove             Deloitte LLP
 125 London Wall                  Chartered Accountants and
 London EC2Y 5AJT                 Statutory Auditors
                                  London

 RBS Hoare Govett Limited         Registrars
 250 Bishopsgate
 London                           Computershare Investor
 EC2M 4AA                         Services PLC
                                  PO Box 92
 Bankers                          The Pavillions
                                  Bridgwater Road
 The Royal Bank of Scotland plc   Bristol
 135 Bishopsgate                  BS99 7NH
 London
 EC2M 3UR                         Company Registration Number
                                  2234775
 Lloyds TSB plc
 25 Gresham Street
 London
 EC2V 7HN

 Registered office

 Juxon House
 100 St Paul's Churchyard
 London
 EC4M 8BU








This announcement is distributed by Thomson Reuters on behalf of 
Thomson Reuters clients. The owner of this announcement warrants that: 
(i) the releases contained herein are protected by copyright and 
    other applicable laws; and 
(ii) they are solely responsible for the content, accuracy and 
     originality of the information contained therein. 
    
Source: Intermediate Capital Group PLC via Thomson Reuters ONE

[HUG#1520488]