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EMI Group PLC (EMI)

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Tuesday 20 May, 2003

EMI Group PLC

Final Results


                                 EMI GROUP PLC                                 

             PRELIMINARY ANNOUNCEMENT FOR YEAR ENDED 31 MARCH 2003             

LONDON 20 May 2003: EMI Group plc today announces its preliminary results for
the year ended 31 March 2003.

Financial overview

Year ended 31 March                   2003       2002     Change  At constant
                                                                     exchange
                                                                        rates
                                                                             
Turnover                          £2175.4m   £2445.8m    (11.1%)       (8.4%)
                                                                             
Operating profit (EBITA)           £254.0m    £190.9m      33.1%        34.8%
                                                                             
Adjusted profit before tax1        £177.3m    £153.3m      15.7%        17.9%
(PBT)                                                                        
                                                                             
Adjusted PBT excluding HMV2        £178.1m    £129.4m      37.6%        40.3%
                                                                             
Profit before tax                  £319.3m  (£152.8m)    £472.1m      £470.7m
                                                                             
Net profit after tax and           £229.7m  (£199.5m)    £429.2m      £427.2m
minority interests                                                           
                                                                             
Adjusted diluted earnings per        15.6p      11.8p      32.2%        33.9%
share                                                                        
                                                                             
Basic earnings per share             29.3p    (25.5p)      54.8p        54.5p

Notes:

 1. Adjusted profit before tax, amortisation and exceptional items
   
 2. HMV floated on London Stock Exchange in May 2002, at which time EMI sold
    down its stake to 14.5%. The remaining holding was sold in November 2002.
   
EMI Group - strong recovery

  * Adjusted PBT (excluding HMV) up 38%, on turnover down 11.1%
   
  * Net profit after tax and minority interests increased £429.2m to £229.7m
   
  * Net debt reduced by £198.1m to £859.8m, and net debt to EBITDA ratio
    improved to 2.9x from 4.4x
   
  * Dividend maintained at 8.0p per share with dividend cover up to nearly
    2.0x.
   
EMI Recorded Music - dramatic turnaround

  * Operating profit increased 81% to £150.5m on turnover down 10.2% at
    constant currency
   
  * EBITA margins more than doubled from 4.1% to 8.5%, driven by both fixed and
    variable cost savings
   
  * Substantial improvement in North America, returning to profitability with
    12% point margin increase
   
  * Progress being made against piracy
   
  * Flexible digital music initiatives rolled out in North America and Europe
   
EMI Music Publishing - resilient

  * Turnover and operating profit held firm at constant currency with
    meaningful growth in performance and synchronisation revenue offsetting
    decline in mechanical royalties.
   
  * Further 30% of Jobete acquired for $109.3m (approximately £68m) in April
    2003
   
Eric Nicoli, Chairman, said: "The year ended 31 March 2003 was one of
remarkable progress and achievement for EMI Group, all the more so in a context
of the global recorded music market declining by almost 9%. This market
movement was markedly worse than we, and others in the industry, anticipated at
the start of the year and demanded a swift and robust response from all parts
of EMI's business.

"We delivered the promised substantial improvement in profitability driven by
the turnaround of EMI Recorded Music, another solid performance from EMI Music
Publishing and tighter financial management across the group. Furthermore, we
have invested time and resources in strengthening our culture and management
capabilities to equip our businesses to compete more effectively in tough
market conditions and a rapidly changing environment. These are the results of
a company now being managed in a very different way from the past.

"In the year ahead, while the market remains volatile and difficult to predict,
we expect it to decline further but, probably, at a slower rate than last year.
We have demonstrated that we have the resilience and flexibility to operate
effectively and profitably in a range of market outcomes and we aim to make
further progress in every part of our group."

Enquiries

EMI Group plc

Amanda Conroy Corporate Communications +44 20 7667 3216

Siobhan Turner Investor Relations +44 20 7667 3234

Brunswick

Patrick Handley +44 20 7404 5959

Video/Audio and text interviews with Eric Nicoli, Chairman, EMI Group, Roger
Faxon, CFO, EMI Group, Alain Levy, CEO, EMI Recorded Music and Martin Bandier,
CEO, EMI Music Publishing will be available from 07:00 on Tuesday 20th May2003
on: www.emigroup.com and on www.cantos.com

Chairman's Statement

The year ended 31 March 2003 was one of remarkable progress and achievement for
EMI Group, all the more so in a context of the global recorded music market
declining by almost 9%. This market movement was markedly worse than we, and
others in the industry, anticipated at the start of the year and demanded a
swift and robust response from all parts of EMI's business.

We delivered the promised substantial improvement in profitability driven by
the turnaround of EMI Recorded Music, another solid performance from EMI Music
Publishing and tighter financial management across the group. Furthermore, we
have invested time and resources in strengthening our culture and management
capabilities to equip our businesses to compete more effectively in tough
market conditions and a rapidly changing environment. These are the results of
a company now being managed in a very different way from the past.

EMI Group

For the group as a whole, operating profit (EBITA) in the year improved by
33.1% to £254.0m on sales 11.1% lower at £ 2,175.4m. Exchange rate movements
had a significant adverse impact; at constant currency, operating profit was up
34.8% while sales declined by 8.4%, broadly in line with the market.

Profit before tax, amortisation and exceptional items improved by 15.7% to £
177.3m. When adjusted for currency and the year on year impact of the sale of
our stake in HMV Group, the underlying improvement was 40.3%.

Under Roger Faxon's stewardship, EMI Group's balance sheet was completely
restructured with the effect of more than doubling the average maturity of our
debt. We converted our passive interest in HMV, Viva Media and other non-core
assets into active investment in our core business and, during the course of
the year, we reduced our net debt position by close to £200m leaving year-end
net debt at £859.8m, its lowest level for four years.

Our tax rate for the year was somewhat lower than in previous years at 25%,
mainly as a result of the improved North American profitability and a more
favourable business mix overall.

Net profit after tax and minority interests improved by £429.2m to £229.7m
compared with the previous year's loss of £199.5m. The resulting improvement in
adjusted diluted earnings per share was 32.2%, to 15.6 pence per share.

The Board is recommending a final dividend of 6.0p per share, giving a full
year dividend of 8.0p per share, thus maintaining the previous year's level and
improving dividend cover to close to two times.

Recorded Music

In EMI Recorded Music, Alain Levy and David Munns have driven the
implementation of their far-reaching restructuring and reorientation plan with
the objective of changing completely the way we work.

The strength and professionalism of the management team at all levels is, I
believe, world class. The focus is now on sustainable, profitable sales, and on
finding, developing and effectively marketing artists who will have long-term,
successful careers.

Sales in Recorded Music fell 12.6% to £1,774.2m as the result of a combination
of factors including macro-economic effects in some regions, a growing impact
of music piracy in all its forms and the disruptive impact of our restructuring
activities, some of which took longer than originally planned.

Our focus on generating profitable sales - rather than market share at any cost
- together with full delivery of the projected cost savings and efficiency
improvements from restructuring, resulted in an increase in operating profit
(EBITA) of 81% to £150.5m. Our performance in North America was particularly
pleasing as we saw margin improve by over 12 percentage points. The UK business
had another year of excellent progress and in South East Asia we moved into
profit for the first time in a number of years.

Music Publishing

EMI Music Publishing, under Martin Bandier's leadership, is, and has been for
many years, demonstrably the best in the industry. While not immune to the
effects of a declining recorded music market from which over 50% of its
revenues derive, this business has, once again, shown great resilience and has
managed to maintain overall sales and profitability by developing and
exploiting other revenue streams.

Due entirely to currency movements, sales in the year fell marginally from £
416.4m to £401.2m and operating profit (EBITA) was 4% lower at £103.5m. At
constant currency, sales were flat and operating profit was down by just 0.5%.

Change

The extensive and challenging change programme of the past year was designed to
put the group on a much sounder financial footing and to allow us to be more
flexible and responsive in the tough competitive conditions that we expect to
prevail in the future. That objective has been achieved.

The scale of the changes implemented over the course of the year was massive
and their impact was often uncomfortable. The improvement in the business could
not have been achieved without the extraordinarily hard work and dedication of
my colleagues across the world. I am proud of them and the way they have
embraced the need for a different way of operating.

We have also seen change in our Board membership. In May, Michael Jackson
stepped down after only two and a half years as the consequence of a change of
ownership of his employer resulting in a conflict of interest. In July, Hugh
Jenkins retired after seven years of distinguished service and I thank both
Michael and Hugh for their support and wise counsel. In September, Peter
Georgescu joined, bringing a wealth of valuable media, advertising, consumer
marketing and general management experience to bear on our strategic
deliberations. Since the year-end, we have been joined by David Londoner, a
renowned former securities analyst with extensive knowledge of the global media
and entertainment industry and the North American investment community.

The future

Content is at the core of EMI - developing and supplying pure music content of
the highest quality. We are committed to providing consumers with the music
they want, in the format they want, at a value they find compelling and we are
working with a vast range of retailers, distributors, hardware and software
manufacturers to make that vision a reality. At the same time, EMI is at the
vanguard of industry efforts to protect our content from theft. Music is
valuable to the people who use it and to those who created it and own it.
Stealing music is the same as stealing any other kind of property and we will
do everything within our power to prevent it.

In a world in which more music is being consumed than ever before, at EMI, with
our extremely deep and rich music content bank, we have a unique opportunity to
develop new revenue streams.

The weakness in the recorded music market is not yet over but we will be
unrelenting in our efforts to attack the root causes of decline and to find
ways to grow our business.

In the year ahead, while the market remains volatile and difficult to predict,
we expect it to decline further but, probably, at a slower rate than last year.
We have demonstrated that we have the resilience and flexibility to operate
effectively and profitably in a range of market outcomes and we aim to make
further progress in every part of our group.

Recorded Music Operating Review

The global music market is undergoing a shift in its traditional shape and
structure that has far-reaching implications for the way the industry has been
accustomed to do business.

EMI Recorded Music entered the financial year with a commitment to changing
fundamentally the way it operates. This initially involved reducing overheads,
including 1,900 jobs, to generate nearly £100m in annualised fixed cost
savings. This was a necessary process in order to create a structure that is
both scaled to the new size of the market and flexible enough to take advantage
of new opportunities that arise or are developed.

This restructuring has contributed to an operating profit (EBITA) uplift of
over 80%, while at the same time having some short-term negative impact on
revenues. In a year where the market fell 8.7%, EMI Recorded Music's turnover
decreased 12.6% (10.2% in constant currency terms) to £1,774.2m. This decrease
is partly the result of general market forces, most notably a significant
increase in both digital and physical piracy. It was also driven by the
disruption to day-to-day operations caused by the extensive restructuring
process, particularly in Continental Europe and at Virgin America, as well as
by the lower than expected performance of some local repertoire releases in
Japan.

While we recognise that, in the long term, sales growth is an important
objective, the year ended 31 March 2003 was clearly one during which we
repositioned EMI Recorded Music on profitable foundations, and its performance
did improve markedly. Operating profit increased 81% to £150.5m (£150.1m at
constant currency), more than doubling operating margins to 8.5% compared with
4.1% last year.

This margin increase is not simply the result of cutting the cost base. In the
year just ended, we pursued an aggressive policy of refocusing Recorded Music
on its core business by streamlining the artist roster and exiting unprofitable
operations and costly joint ventures.

The improvement also demonstrates the importance of concentrating on
profitable, sustainable sales from artists with long-term potential. EMI had
considerable global success with such artists, including the phenomenal debut
album from Norah Jones, Come Away With Me, which has now sold 13m copies; the
excellent second album A Rush of Blood to the Head from UK band Coldplay and
Robbie Williams' Escapology, both now nearing 6m copies; and the definitive
greatest hits from the Rolling Stones, now over 5m copies of a double album. We
also had excellent regional successes from artists such as Utada Hikaru, Renaud
and Herbert Grönemeyer, whose album Mensch sold over 3m copies to become the
highest selling album ever in Germany.

Looking at our performance on a regional basis, the turnaround in our North
American business was encouraging. After five consecutive years of losses, the
new management team has delivered a return to profitability and a margin
increase of more than 12 percentage points. While market share fell
significantly in the first half, there was a gradual increase over the second
half, with Norah Jones' eight Grammy awards in February a particular highlight.

The changes made at Capitol have delivered initial successes from artists
including debut albums from The Vines and, more recently, Lisa Marie Presley.
Virgin is now beginning to rebuild its roster and EMI is increasingly confident
of generating US-signed artists for worldwide exploitation, while recognising
that progress will be gradual in this very competitive market.

The UK had yet another impressive year and continues to be a major source of
repertoire both for local and international exploitation, as well as a standard
of excellence in extracting value from catalogue.

Continental Europe underwent the most comprehensive restructuring of all
territories that took longer than anticipated to complete. Nonetheless, it
remains a highly profitable business, and had significant success with a number
of local repertoire releases, including albums from Renaud in France and
Herbert Grönemeyer in Germany. With the restructuring now complete, we expect
to make progress at all levels.

Japan had some important successes, notably with Utada Hikaru's third album
Deep River, but nonetheless turned in a somewhat disappointing result as
certain significant local repertoire releases, particularly in the fourth
quarter, did not perform as well as expected. Despite tough market conditions,
we remain confident in the quality of our team in Japan and their ability to
deliver future successes.

Asia, outside of Japan, was another great success, turning in its first profit
in a number of years. EMI is pursuing a very aggressive strategy to improve
both market share and profit in this region. This includes a significant push
into China, illustrated by substantial investment in local repertoire, which
offers considerable potential despite severe piracy.

Results in Latin America were mixed. There were significant setbacks in Mexico
resulting from piracy and poor local management performance. This management is
in the process of being replaced. EMI also closed its Venezuelan operations
because of the severe economic problems in that country. At the same time,
however, the region's most important market, Brazil, returned to profitability
and there was considerable progress in the growing US Latin market.

Beyond improving immediate profitability, containing piracy has become another
major priority for EMI. During the year, EMI Recorded Music created a global
anti-piracy team. Overall we have allocated substantial management time to
lobbying governments to enact and enforce stronger legal penalties, and to
identifying technologies and establishing procedures that protect our music.
The group is determined to contain the sales erosion caused by physical
counterfeiting, illegal file sharing and CD burning.

In recent months we have started to see a shift in the attitudes of governments
as to the seriousness of the situation and are starting to witness their
willingness to confront the problem.

Piracy containment is one important part of the new environment. It is,
however, clear that consumers want to access music legally via the net and we
are making considerable efforts and progress in turning this into reality.
EMI's catalogue is very widely available in digital delivery services and the
group has taken a leadership position in offering more of our content on the
net. EMI is also actively pursuing opportunities offered by the digital world
such as ring tunes and video distribution as well as gaining further insight
into music consumers' behaviour.

In the year under review, EMI Recorded Music began building the foundations for
the music company it aims to become, operating under principles that focus on
profitable sales growth and long-term artist development. There is more
interest in, and consumption of, music than ever before, and there is a
tremendous opportunity ahead to legitimise and capitalise on this demand.

Looking ahead to the current financial year, the markets are likely to remain
challenging. However, we are confident of being able to face the issues, both
in terms of supplying high-quality music, for which there is growing demand,
and in maximising the revenue EMI Recorded Music generates from this music. On
this basis, we expect to improve market share.

Music Publishing Operating Review

EMI Music Publishing delivered another solid performance, despite the
challenges presented by the downturn in the global recorded music market. For
the year as a whole, operating profit (EBITA) fell from £107.8m in the previous
year to £103.5m in the year ended 31 March 2003. This decrease resulted from
currency movements, in particular weakness in the US dollar, and from a slight
increase in corporate charges. On a constant currency basis and before central
cost allocation, Music Publishing operating profit (EBITA) increased
marginally, from £110.6m in 2002 to £111.0m in the year ended March 2003.

The turnover generating this margin also remained broadly flat on a constant
currency basis, at £416.6m compared with £416.4m in the previous year. Taking
into account currency effects, turnover fell 3.7% to £401.2m.

This resilient performance reflects the strength of EMI Music Publishing's
ability to develop new revenue sources and additional uses of music that reduce
its reliance on the recorded music industry. Mechanical royalties, primarily
derived from the sale of music in CD format, now comprise only 53% of our total
turnover, down from 55% in the previous year, and 60% in 1998.

The 8.7% decline in the recorded music industry in the year ended 31 March 2003
did have an impact on mechanical royalties. Nevertheless, with a fall of only
3.5% at constant currency in mechanicals, we outperformed the global market,
demonstrating the continued success of our strategy of signing leading writers
across all genres, together with our ability to generate repeated uses through
re-recordings of songs in our existing catalogues, in particular the great
songs from the Motown era included in the Jobete catalogue.

Performance income, derived from the public performance of songs in EMI's
catalogue, comprises 25% of EMI Music Publishing's turnover and grew 3.3% at
constant currency, representing the fifth consecutive year that this revenue
stream has increased. Driving this growth is our strong chart share, together
with the increase in media outlets, the resolution of outstanding cable rate
disputes in the US, which increased revenues by bringing cable royalty rates in
line with other media, and increased efficiencies at the local societies in the
collection of publishing revenues.

Synchronisation royalties generate 14% of Music Publishing turnover, and also
grew strongly, up 7.9% at constant currency. This substantial increase at a
time when the global advertising market has been under pressure is a
considerable success. It demonstrates the value in EMI's successful
exploitation of its catalogue not only in commercials but also in films, TV
programming and, increasingly, the video game market which uses music to
enhance game play.

Key elements in driving its synchronisation revenues are Music Publishing's
business-to-business website and Music Spa. The site has over 6,000 regular
users worldwide who can search our catalogues to suit a variety of music needs.
Since its relaunch in February, daily traffic has increased by over 70%. The
Spa, housed in the company's New York office, is a creative atmosphere with the
technical capabilities that allow advertisers and their agencies to work with
EMI's Music Resources Group to sample and identify the music that best fits the
product and message of a commercial campaign.

Songs from Music Publishing's catalogues are also featured in a variety of
musicals, which EMI actively seeks to promote. Current shows include: We Will
Rock You, based on the Queen catalogue; Mamma Mia, using the songs of Abba; and
Our House, featuring the songs of Madness. In autumn 2003, a new musical
featuring the music of EMI-signed writer Rod Stewart is expected to open in
London's West End, and plans are underway for a Motown-based musical to be
written and produced by Motown founder Berry Gordy.

In North America, turnover fell 1.5% as gains in synchronisation income were
offset by falls in mechanicals, but again by less than the overall market
decline. EMI Music Publishing was once again named Publisher of the Year by
performance societies ASCAP and BMI and by Billboard magazine. EMI Music
Publishing writers, artists and producers cumulatively earned 24 Grammys,
one-third of which went to Norah Jones and her debut album Come Away With Me,
which to date has sold 13m copies.

In the UK, turnover grew 3.8%, reflecting an increase in both mechanical and
performance income driven by our continued leadership position in the UK
charts. EMI Music Publishing and its writers won numerous awards at every major
UK award ceremony, including six Brits and five Ivor Novello Music Awards, and
Music Week named us Publisher of the Year for the eighth year in a row.

Continental European performance was mixed. Certain markets, notably Germany
and Italy, were impacted by steep local market declines in recorded music.
France countered that trend as the recorded music market grew 3% year on year,
while the Benelux countries also generated revenue gains.

Japan had a very strong year, increasing sales by over 5% in large part because
of the strong performance of Utada Hikaru's third album Deep River, which sold
over 4m copies in Japan alone.

Shortly after the end of the financial year, in April 2003, EMI acquired a
further 30% of the Jobete catalogue from Berry Gordy for US $109.3 m, bringing
EMI's total share in Jobete to 80%. This gives EMI greater control over its
superb array of Motown songs, together with the financial benefit of being able
to consolidate it for tax purposes.

Successful writers contributing to this year included Norah Jones, Pink,
Enrique Iglesias, Pharrell Williams, and White Stripes, and new signings
included Dirty Vegas, Busted, Ms Dynamite and Sean Paul, to name a few.

New uses of Publishing's music contributed additional revenue streams to income
this year including ring tones and video games, as mentioned above. The ring
tone market has developed as cellular penetration has continued to grow and
users look for ways to personalise their phones.

For the current financial year, we expect to see further pressure on mechanical
royalties in the face of a continued expected decline in the global recorded
music market. Nevertheless, we expect to continue to exploit aggressively our
impressive catalogue of songs, both current and classic, in the synchronisation
market and develop new income streams, such as ring tones, video games, and
on-line uses.

Financial Review

The year ended 31 March 2003 was one of substantial challenge for EMI as its
primary market fell for the third year in a row. However, it was also a year of
unprecedented accomplishment.

The group implemented a comprehensive reorganisation of its Recorded Music
division, reducing headcount by 1,900 and the ongoing fixed cost base by nearly
£100m. Against a backdrop of lower sales, Recorded Music substantially improved
its operating margins driving its underlying profits up 81% and, for the first
time in five years, the US Recorded Music business generated a profit. Music
Publishing yet again demonstrated its resilience in the face of exceedingly
difficult market conditions. By continuing to diversify its income, it was able
to hold firm its profits and margins.

The group also completed a sweeping balance sheet restructuring, more than
doubling average debt maturity to five years, and converted passive interests
in HMV, Viva Media and other assets into active investment in the core
business. Joined with the improved operating performance and careful cash
management, the sale of these assets resulted in a reduction in net debt of
over £198m, reducing the company's leverage to below three times EBITDA, down
from 4.4 times just a year ago.

Group turnover fell by £270.4m (11.1%), including a decrease of £64.0m from
exchange on translation. All regions had lower turnover in the year. After
excluding currency effects, the decrease was entirely in EMI Recorded Music,
reflecting both the global downturn in the recorded music market and EMI's
focus on ensuring that sales are delivered profitably. At constant currency,
EMI Music Publishing sales remained flat.

Group operating profit (EBITA) increased 33.1%, from £190.9m in 2002 to £254.0m
in 2003, resulting from the impact of the cost savings implemented in EMI
Recorded Music over the financial year, together with additional margin
improvements in that business and a continued solid performance from EMI Music
Publishing.

Group turnover for the second half fell by £164.9m (12.0%) to £1,213.9m, of
which decrease £36.1m was attributable to exchange on translation. Excluding
the effects of currency, Recorded Music sales were down by £120.7m or 10.4%. On
a similar basis Music Publishing turnover decreased by £8.1m, largely as the
result of timing differences.

Group operating profit for the second half was £27.2m higher than last year, at
£175.0m. This included a loss of £1.8m from exchange on translation.
Second-half Recorded Music profits were up 33.7% to £121.9m at constant
exchange rates, reflecting the substantial turnaround in its North American
business and continued strong results the UK, partially offset by decreases in
other regions, particularly Continental Europe. Timing differences resulted in
Music Publishing operating profit falling 3.0% at constant exchange rates to £
54.9m.

Following the exit in the previous year from loss-making Recorded Music
satellite operations, operating profit in associates moved from a loss of £1.1m
last year to a profit of £0.2m this year.

In May 2002, HMV Group plc listed on the London Stock Exchange, and EMI
simultaneously reduced its stake to 14.5%. In November 2002, EMI sold this
remaining stake. Therefore, the Group no longer consolidates HMV's operating
profit and interest charges, which last year were £44.6m and £20.7m
respectively. For the period up to flotation, EMI's share of HMV's operating
profit was £0.4m, and of its finance charges, £1.2m.

Group finance charges of £76.1m were £15.7m higher than last year as the result
of higher interest rates following the restructuring of debt into longer-term
instruments, which more than offset the impact from the substantial reduction
in overall debt levels. In February 2003, EMI crystallised a reduction in the
long-term cost of its US bond by unwinding certain derivative positions. The
interest charge on these bonds will in the future be offset by a proportion of
the gain resulting from this action.

Adjusted profit before tax, amortisation and exceptional items (adjusted PBT)
grew 15.7%, from £153.3m in 2002 to £177.3m in 2003.

Other items affecting earnings

The group tax rate, before amortisation and exceptional items, fell to 25% from
30% last year. A major contributor to the reduction in the tax rate is the
return to profitability of our US business, which has brought forward tax
losses available for offset, and somewhat lower profits in Japan, the group's
highest tax-paying territory.

Amortisation of copyrights acquired and goodwill on acquisition fell to £42.8m
from £51.3m in the previous year, reflecting the write-down of investments in
the year ended March 2002 in connection with the Recorded Music restructuring
and exchange.

During the period, the group incurred a non-cash charge of £24.9m arising from
the write-down of certain investments and other assets, including EMI Group
shares held in the Employee Benefit Trust. This is reported as an operating
exceptional cost. This is in contrast to the year ended 31 March 2002, in which
the group incurred an operating exceptional charge of £242.4m relating to
restructuring and reorganisation costs, mainly within EMI Recorded Music. In
that same period, HMV Group also incurred exceptional costs, of which EMI's
share was £12.4m.

The group benefited from a non-operating exceptional profit of £209.7m, largely
arising from the disposal of its stakes in HMV and Viva Media AG, offset by a
modest loss relating to certain other disposals.

The minority interest charge has fallen from £8.5m to £6.4m, as a result of the
decrease in profitability of our Japanese Recorded Music business in the year.

The overall group result was a profit of £229.7m, compared with a loss of £
199.5m in the previous year, an improvement of £429.2m.

Adjusted diluted earnings per share were 15.6p, compared with 11.8p. The Board
is recommending a final dividend of 6.0p per share to result in a total
dividend of 8.0p per share, unchanged from last year.

Cash flow and net borrowings

The net cash inflow from operating activities was £117.2m. After net proceeds
from acquisitions, disposals and financial investments of £204.5m, capital
expenditure of £59.2m, tax paid of £38.7m, net interest costs of £4.6m
(including the gain on the swap unwind discussed above), dividends paid of £
35.9m (including those to minorities) and currency translation gains and other
movements of £14.8m, net debt decreased by £198.1m to £859.8m.

Pensions

The group continues to account under SSAP 24, but its disclosures also include
those required by FRS 17. EMI maintains a number of defined benefit plans
around the world the largest of which is the UK pension plan. As at 31 March
2002, that plan was in surplus by £68m, as calculated pursuant to FRS 17. With
the decline in share prices to 31 March 2003, the asset value of the fund has
fallen. Therefore, as calculated pursuant to the FRS 17 accounting standard,
the fund would show a deficit as at 31 March 2003 of £116m, or £81.2m net of
deferred tax. Under FRS 17, the calculation of the net position of the fund is
highly sensitive to several factors. For example, had the calculation been
performed as of 15 May 2003 as opposed to 31 March 2003, the asset value of the
fund would have been higher by almost £40m, given the rise in share values in
the intervening period.

The group is scheduled to receive the triennial actuarial valuation of the UK
fund as at 31 March 2003 in the coming months. Based upon the outcome of that
valuation, the group will review its funding policies with respect to the fund.

Treasury policy

Treasury activities are carried out within a framework of policies and
guidelines approved by the Board, with control and monitoring delegated to the
Treasury Management Committee, chaired by the Group Chief Financial Officer.
These policies aim to ensure that adequate, cost-effective funding is available
to the group at all times, and that exposure to financial risks is minimised.
The existing Treasury policies were reviewed by the Board in April 2002 and
have remained substantially unchanged throughout the financial year.

Financial instruments held by the group comprise derivatives, borrowings, cash
and liquid resources and other financial assets and liabilities. Their purpose
is to raise finance for the group's operations. Treasury policies prohibit
their use for speculative purposes.

Funding

During the year, EMI restructured its debt into medium and long-term
facilities. The six-year sterling bond issued in May was increased in June to £
325m, and in August a further US$180m was raised from a private placement of
debt with maturities of between seven and 10 years. Together with net proceeds
from the HMV disposal of £209.5m and £35.6m from the sale of fixed asset
investments, these funds were used to repay and cancel part of the £1.3bn
revolving credit facility finalised in April 2002.

The group borrows in various currencies at fixed and floating rates, and uses
swaps, caps and collars to manage interest rate exposure. Unless otherwise
approved by the Board, Treasury policy is to keep between 25% and 75% of
borrowings at fixed or capped rates. As a result of the reduction in borrowings
during the year, and as approved by the Board, at the year end virtually all
borrowings were fixed or capped.

Foreign currency risk

The group faces currency exposure from exchange rate fluctuation against
sterling. Balance sheet exposures are hedged to the extent that overseas
liabilities, including borrowings, provide a natural hedge. Group policy is not
to undertake additional balance sheet hedging measures, nor to hedge profit and
loss account translation exposure. Transaction exposures are hedged, where
there are material items that have a high probability of occurring, with the
use of forward exchange rate contracts.

ATTACHMENTS

EMI GROUP PLC FINANCIAL STATEMENTS

(a)       Financial highlights for the year ended 31 March 2003.               
                                                                               
(b)-(c)   Consolidated profit and loss account for the year ended 31 March     
          2003.                                                                
                                                                               
(d)       Consolidated balance sheet at 31 March 2003.                         
                                                                               
(e)       Statement of total recognised gains and losses for the year ended 31 
          March 2003.                                                          
                                                                               
(e)       Reconciliation of movements in shareholders' funds for the year ended
          31 March 2003.                                                       
                                                                               
(f)-(g)   Consolidated cash flow statement for the year ended 31 March 2003.   
                                                                               
(h)-(o)   Notes to the financial statements for the year ended 31 March 2003.  

                                                                 Attachment (a)

                                 EMI Group plc                                 

                             FINANCIAL HIGHLIGHTS                              

                       for the year ended 31 March 2003                        

                                                          2003             2002
                                                                               
                                                            £m               £m
                                                                               
Group turnover                                         2,175.4          2,445.8
                                                                               
EBITDA (i)                                               297.0            241.9
                                                                               
Group operating profit before operating                  254.0            190.9
exceptional items and amortisation (EBITA)                                     
                                                                               
Profit before taxation, exceptional items and            177.3            153.3
amortisation (ii)                                                              
                                                                               
Profit before taxation                                   319.3          (152.8)
                                                                               
Basic earnings per share                                 29.3p          (25.5)p
                                                                               
Adjusted diluted earnings per share (iii)                15.6p            11.8p
                                                                               
Dividend per share                                        8.0p             8.0p
                                                                               
Return on sales (iv)                                     11.7%             7.8%
                                                                               
Interest cover (v)                                        3.9x             4.0x

(i)      EBITDA is Group operating profit before operating exceptional items,  
         depreciation and amortisation of goodwill and music copyrights.       
                                                                               
(ii)     Profit before taxation, exceptional items and amortisation is before  
         both operating and non-operating exceptional items and amortisation of
         goodwill and music copyrights.                                        
                                                                               
(iii)    Adjusted diluted earnings per share is before both operating and      
         non-operating exceptional items and amortisation of goodwill and music
         copyrights.                                                           
                                                                               
(iv)     Return on sales is defined as Group operating profit before operating 
         exceptional items and amortisation of goodwill and music copyrights as
         a percentage of turnover.                                             
                                                                               
(v)      Interest cover is defined as the number of times Group EBITDA is      
         greater than Group finance charges.                                   

                                                                 Attachment (b)

                                 EMI Group plc                                 

                     CONSOLIDATED PROFIT AND LOSS ACCOUNT                      

                       for the year ended 31 March 2003                        

                                       Year ended 31.03.03  Year ended 31.03.02
                                                                               
                                                 EMI Group  EMI Group          
                                                (excl. HMV (excl. HMV          
                                                    Group)     Group)          
                                                                               
                                          Total     Before     Before     Total
                                                     excep      excep          
                                                   items &    items &          
                                                    amortn     amortn          
                                                                               
                                             £m         £m         £m        £m
                                                                               
TURNOVER:                                                                      
                                                                               
   Total (including joint venture)      2,240.9    2,175.4    2,445.8   3,153.7
                                                                               
   Less: joint venture turnover          (65.5)          -          -   (707.9)
                                                                               
Group turnover (note 2)                 2,175.4    2,175.4    2,445.8   2,445.8
                                                                               
Cost of sales                         (1,376.7)  (1,331.2)  (1,592.7) (1,726.5)
                                                                               
Gross profit                              798.7      844.2      853.1     719.3
                                                                               
Distribution costs                       (98.7)     (98.7)    (119.9)   (127.5)
                                                                               
Administration expenses                 (544.7)    (528.9)    (577.4)   (708.9)
                                                                               
Other operating income, net                31.1       37.4       35.1      16.1
                                                                               
Group operating profit (loss) (note       186.4      254.0      190.9   (101.0)
2)                                                                             
                                                                               
    Share of operating profit in            0.4          -          -      44.6
    joint venture before exceptional                                           
    items                                                                      
                                                                               
    Share of operating exceptional            -          -          -    (10.3)
    items in joint venture                                                     
                                                                               
Share of operating profit in joint          0.4          -          -      34.3
venture                                                                        
                                                                               
Share of operating profits (losses)         0.1        0.2      (1.1)     (2.9)
in associated undertakings                                                     
                                                                               
Total operating profit (loss)             186.9      254.2      189.8    (69.6)
                                                                               
Non-operating exceptional items (note     209.7          -          -         -
3)                                                                             
                                                                               
Profit (loss) before finance charges      396.6      254.2      189.8    (69.6)
                                                                               
FINANCE CHARGES:                                                               
                                                                               
   Group (including associates)          (76.1)     (76.1)     (60.4)    (60.4)
                                                                               
       Joint venture before               (1.2)          -          -    (20.7)
       exceptional items                                                       
                                                                               
       Joint venture - exceptional            -          -          -     (2.1)
       items                                                                   
                                                                               
   Joint venture                          (1.2)          -          -    (22.8)
                                                                               
Total finance charges (note 4)           (77.3)     (76.1)     (60.4)    (83.2)
                                                                               
Profit (loss) on ordinary activities      319.3      178.1      129.4   (152.8)
before taxation                                                                
                                                                               
Adjusted (loss) profit before tax -                  (0.8)       23.9          
HMV Group (discontinued)                                                       
                                                                               
Profit before tax, exceptional items                 177.3      153.3          
and amortisation                                                               

                                                                 Attachment (c)

                                 EMI Group plc                                 

                CONSOLIDATED PROFIT AND LOSS ACCOUNT continued                 

                       for the year ended 31 March 2003                        

                                      Year ended 31.03.03   Year ended 31.03.02
                                                                               
                                                EMI Group    EMI Group         
                                               (excl. HMV   (excl. HMV         
                                                   Group)       Group)         
                                                                               
                                        Total      Before Before excep    Total
                                              excep items      items &         
                                                 & amortn       amortn         
                                                                               
                                           £m          £m           £m       £m
                                                                               
Profit (loss) on ordinary activities    319.3       178.1        129.4  (152.8)
before taxation                                                                
                                                                               
Taxation on profit on ordinary         (83.2)      (45.1)       (38.6)   (38.2)
activities (note 5)                                                            
                                                                               
Profit (loss) on ordinary activities    236.1       133.0         90.8  (191.0)
after taxation                                                                 
                                                                               
Minority interests (equity)             (6.4)      (10.3)       (15.2)    (8.5)
                                                                               
Profit (loss) attributable to           229.7       122.7         75.6  (199.5)
members of the holding company                                                 
                                                                               
Dividends (equity) (note 6)            (62.8)                            (62.2)
                                                                               
Transfer to (from) profit & loss        166.9                           (261.7)
reserve                                                                        

                                                                 Attachment (d)

                                 EMI Group plc                                 

                          CONSOLIDATED BALANCE SHEET                           

                               at 31 March 2003                                

                                                                2003       2002
                                                                               
                                                  Notes           £m         £m
                                                                               
FIXED ASSETS                                                                   
                                                                               
Music copyrights                                               451.2      518.2
                                                                               
Goodwill                                                        56.2       34.0
                                                                               
Tangible fixed assets                                          289.4      277.3
                                                                               
Investments: associated undertakings                             6.7        7.1
                                                                               
Other fixed asset investments                                   15.5       22.4
                                                                               
Investments: own shares                                          7.3       13.1
                                                                               
                                                               826.3      872.1
                                                                               
CURRENT ASSETS                                                                 
                                                                               
Stocks                                                          36.4       43.0
                                                                               
Debtors: amounts falling due within one year                   816.7      763.7
                                                                               
Debtors: amounts falling due after more than one               138.6      133.8
year                                                                           
                                                                               
Deferred taxation                                               14.6       17.1
                                                                               
Investments: liquid funds                           8            0.5        0.7
                                                                               
Cash at bank & in hand & cash deposits              8          100.2       85.7
                                                                               
                                                             1,107.0    1,044.0
                                                                               
CREDITORS: amounts falling due within one year                                 
                                                                               
Borrowings                                          8         (38.5)    (771.0)
                                                                               
Other creditors                                            (1,365.0)  (1,297.1)
                                                                               
                                                           (1,403.5)  (2,068.1)
                                                                               
NET CURRENT LIABILITIES                                      (296.5)  (1,024.1)
                                                                               
TOTAL ASSETS LESS CURRENT LIABILITIES                          529.8    (152.0)
                                                                               
CREDITORS: amounts falling due after more than                                 
one year                                                                       
                                                                               
Borrowings                                          8        (922.0)    (373.3)
                                                                               
Other creditors                                               (58.1)     (27.4)
                                                                               
                                                             (980.1)    (400.7)
                                                                               
PROVISIONS FOR LIABILITIES AND CHARGES                                         
                                                                               
Deferred taxation                                              (5.5)      (3.4)
                                                                               
Other provisions                                   10        (104.4)    (173.1)
                                                                               
Investments: joint venture (HMV Media Group)                       -    (159.9)
                                                                               
                                                             (109.9)    (336.4)
                                                                               
                                                             (560.2)    (889.1)
                                                                               
CAPITAL AND RESERVES                                                           
                                                                               
Called-up share capital                                        110.4      110.4
                                                                               
Share premium account                                          445.8      445.8
                                                                               
Capital redemption reserve                                     495.8      495.8
                                                                               
Other reserves                                                 256.0      256.0
                                                                               
Profit & loss reserve                                      (2,001.1)  (2,338.2)
                                                                               
Equity shareholders' funds                                   (693.1)  (1,030.2)
                                                                               
MINORITY INTERESTS (EQUITY)                                    132.9      141.1
                                                                               
                                                             (560.2)    (889.1)

                                                                 Attachment (e)

                                 EMI Group plc                                 

                STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES                 

                       for the year ended 31 March 2003                        

                                              2003     2003     2002       2002
                                                                               
                                                £m       £m       £m         £m
                                                                               
Profit (loss) for the financial year                                           
                                                                               
   Group                                              230.1             (202.0)
                                                                               
   Joint venture                                      (0.5)                 4.1
                                                                               
   Associates                                           0.1               (1.6)
                                                                               
Profit (loss) for the financial year                  229.7             (199.5)
                                                                               
Currency translation - Group*               (13.5)             (6.5)           
                                                                               
Currency translation - joint venture and         -               0.5           
associates                                                                     
                                                                               
Other recognised losses                              (13.5)               (6.0)
                                                                               
Total recognised gains and losses                     216.2             (205.5)
relating to the year                                                           
                                                                               
*Net currency gains of £7.6m (2002: £1.5m) which relate to foreign currency    
borrowings to finance investment overseas and the related tax charge of £nil   
(2002: £nil), have been included within the Group currency translation movement
on reserves.                                                                   

              RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS               

                       for the year ended 31 March 2003                        

                                              2003      2003    2002       2002
                                                                               
                                                £m        £m      £m         £m
                                                                               
Opening shareholders' funds                        (1,030.2)            (776.2)
                                                                               
Profit (loss) for the financial year         229.7           (199.5)           
                                                                               
Dividends (equity) (note 6)                 (62.8)            (62.2)           
                                                                               
Other recognised losses                     (13.5)             (6.0)           
                                                                               
Goodwill adjustments                         183.7               9.9           
                                                                               
Share of joint venture reserves adj.             -               3.6           
                                                                               
Shares issued                                    -               0.2           
                                                                               
Net increase (decrease) in shareholders'               337.1            (254.0)
funds for the year                                                             
                                                                               
Closing shareholders' funds                          (693.1)          (1,030.2)

                                                                 Attachment (f)

                                 EMI Group plc                                 

                       CONSOLIDATED CASH FLOW STATEMENT                        

                       for the year ended 31 March 2003                        

                                                              2003        2002
                                                                              
                                                                £m          £m
                                                                              
Net cash inflow from operating activities                    117.2       211.9
                                                                              
Dividends received from associated undertakings                0.1         0.7
                                                                              
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE                               
                                                                              
Net interest paid                                            (4.6)      (58.7)
                                                                              
Dividends paid to minorities                                 (6.5)       (3.3)
                                                                              
Net cash outflow from returns on investments and            (11.1)      (62.0)
servicing of finance                                                          
                                                                              
Tax paid                                                    (38.7)      (22.3)
                                                                              
CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT                                  
                                                                              
Purchase of music copyrights                                 (7.6)      (10.6)
                                                                              
Sale of music copyrights                                       1.2           -
                                                                              
Purchase of tangible fixed assets                           (68.5)      (39.2)
                                                                              
Sale of tangible fixed assets                                  9.3        10.1
                                                                              
Purchase of investments: own shares                          (0.8)       (1.9)
                                                                              
Purchase of fixed asset investments                         (10.4)           -
                                                                              
Sale of fixed asset investments                               35.6         0.1
                                                                              
Purchase of associated undertakings                          (1.8)       (3.6)
                                                                              
Loans repaid by associated undertakings                        0.7         0.8
                                                                              
Disposal of associated undertakings                            2.2         1.9
                                                                              
Net cash outflow from capital expenditure and               (40.1)      (42.4)
financial investment                                                          
                                                                              
ACQUISITIONS AND DISPOSALS                                                    
                                                                              
Purchase of businesses net of cash acquired                 (22.4)      (22.6)
                                                                              
Disposal of joint venture (HMV Group plc)                    209.5           -
                                                                              
Deferred consideration paid                                  (1.0)       (1.4)
                                                                              
Disposal of subsidiary undertaking                           (0.7)           -
                                                                              
Net cash inflow (outflow) from acquisitions and              185.4      (24.0)
disposals                                                                     
                                                                              
Equity dividends paid                                       (29.4)     (125.3)
                                                                              
Net cash inflow (outflow) before management of liquid        183.4      (63.4)
resources and financing                                                       
                                                                              
Issue of Ordinary Share capital                                  -         0.2
                                                                              
Management of liquid resources (note 9)                        1.1         5.1
                                                                              
Financing (note 9)                                         (154.9)         0.6
                                                                              
Net cash (outflow) inflow from management of liquid        (153.8)         5.9
resources and financing                                                       
                                                                              
Increase (decrease) in cash (note 9)                          29.6      (57.5)
                                                                              

                                                                 Attachment (g)

                                 EMI Group plc                                 

                  CONSOLIDATED CASH FLOW STATEMENT continued                   

                       for the year ended 31 March 2003                        

Reconciliation of Group operating profit (loss) to net cash inflow from
operating activities:

                                                           2003            2002
                                                                               
                                                             £m              £m
                                                                               
Group operating profit (loss)                             186.4         (101.0)
                                                                               
Depreciation charge                                        43.0            51.0
                                                                               
Amortisation charge:                                                           
                                                                               
     Music copyrights                                      39.0            43.5
                                                                               
     Goodwill                                               3.7             6.0
                                                                               
Fixed asset write-down                                        -             1.1
                                                                               
Goodwill write-down - subsidiaries                         12.1            29.3
                                                                               
Goodwill write-down - associates                              -             8.5
                                                                               
Music copyrights write-down                                 6.5               -
                                                                               
Current asset investment write-down                         2.5               -
                                                                               
Investments: own shares write-down                          3.8               -
                                                                               
Associated undertaking write-down                             -             7.0
                                                                               
Amounts provided (note 10)                                  9.7           107.2
                                                                               
Provisions utilised (note 10):                                                 
                                                                               
     Disposals and fundamental reorganisations            (1.6)          (12.5)
                                                                               
     Other                                               (83.7)          (16.9)
                                                                               
(Increase) decrease in working capital:                                        
                                                                               
     Stock                                                  2.4             2.6
                                                                               
     Debtors                                             (94.8)            63.9
                                                                               
     Creditors                                           (11.8)            22.2
                                                                               
Net cash inflow from operating activities                 117.2           211.9

                                                                 Attachment (h)

                                 EMI Group plc                                 

                             NOTES TO THE ACCOUNTS                             

                       for the year ended 31 March 2003                        

NOTE 1 - BASIS OF PREPARATION

The consolidated financial statements are prepared under the historical cost   
convention and in accordance with applicable accounting standards. The results 
for the years ended 31 March 2003 and 31 March 2002 represent continuing       
operations except the joint venture (HMV Group plc).                           
                                                                               
The financial statements have been prepared on the basis of the accounting     
policies set out in the Group's financial statements for the year ended 31     
March 2003.                                                                    
                                                                               
This announcement does not constitute the Group's financial statements for the 
year ended 31 March 2003. The financial statements for the year ended 31 March 
2003 have not yet been delivered to the registrar. However the auditors have   
issued an unqualified audit report on the financial statements for this year.  

NOTE 2 - SEGMENTAL ANALYSES

                                          2003       2003      2002       2002
                                                                              
                                                Operating            Operating
                                                                              
                                      Turnover     Profit  Turnover     Profit
                                                                              
                                            £m         £m        £m         £m
                                                                              
BY CLASS OF BUSINESS:                                                         
                                                                              
    Recorded Music                     1,774.2      150.5   2,029.4       83.1
                                                                              
    Music Publishing                     401.2      103.5     416.4      107.8
                                                                              
Group*                                 2,175.4      254.0   2,445.8      190.9
                                                                              
Operating exceptional items and                    (67.6)              (291.9)
amortisation**                                                                
                                                                              
Group operating profit*                             186.4              (101.0)
                                                                              
BY ORIGIN:                                                                    
                                                                              
    United Kingdom                       330.9       69.1     338.9       59.4
                                                                              
    Rest of Europe                       660.5       88.6     732.0       98.7
                                                                              
    Latin America                         51.0      (2.5)      88.1      (2.8)
                                                                              
    North America                        706.1       68.3     826.3      (2.1)
                                                                              
    Asia Pacific                         409.9       27.6     439.8       33.6
                                                                              
    Other                                 17.0        2.9      20.7        4.1
                                                                              
Group*                                 2,175.4      254.0   2,445.8      190.9
                                                                              
BY DESTINATION:                                                               
                                                                              
    United Kingdom                       316.8                337.4           
                                                                              
    Rest of Europe                       675.3                726.9           
                                                                              
    Latin America                         46.3                 88.9           
                                                                              
    North America                        707.4                828.6           
                                                                              
    Asia Pacific                         406.7                440.6           
                                                                              
    Other                                 22.9                 23.4           
                                                                              
Group*                                 2,175.4              2,445.8           
                                                                              
*Group turnover and operating profit excludes the Group's share of amounts    
relating to the joint venture (HMV Group), which was discontinued on 15 May   
2002, and associated undertakings. Amounts relating to joint venture have been
excluded due to non-coterminous period ends.                                  
                                                                              
**Comprises operating exceptional items of £(24.9)m (2002: £(242.4)m) and     
amortisation of goodwill and music copyrights of £(42.7)m (2002: £(49.5)m).   
The split of operating exceptional items and amortisation of goodwill and     
music copyrights by class of business is as follows: Recorded Music £(24.2)m  
(2002: £(235.1)m), Music Publishing £(43.4)m (2002: £(56.8)m). The split of   
operating exceptional items and amortisation of goodwill and music copyrights 
by origin is as follows: United Kingdom £(16.3)m (2002: £(19.2)m); Rest of    
Europe £(12.1)m (2002: £(53.3)m); Latin America £(0.1)m (2002: £(22.2)m);     
North America £(38.4)m (2002: £(176.0)m); Asia Pacific £(0.4)m (2002: £(19.0) 
m); Other £(0.3)m (2002: £(2.2)m).                                            


                                                                 Attachment (i)

                                 EMI Group plc                                 

                        NOTES TO THE ACCOUNTS continued                        

                       for the year ended 31 March 2003                        

NOTE 2 - SEGMENTAL ANALYSES continued

                                       2003        2003       2002        2002
                                                                              
                                  Operating     Average  Operating     Average
                                     Assets   Employees     Assets   Employees
                                                                              
                                         £m         No.         £m         No.
                                                                              
BY CLASS OF BUSINESS:                                                         
                                                                              
    Recorded Music                    180.6       7,439       44.4       8,644
                                                                              
    Music Publishing                  409.2         649      453.9         626
                                                                              
    HMV Group plc - discontinued          -         n/a    (162.9)         n/a
                                                                              
Group                                 589.8       8,088      335.4       9,270
                                                                              
BY ORIGIN:                                                                    
                                                                              
    United Kingdom                     76.8       1,162    (113.1)       1,423
                                                                              
    Rest of Europe                      6.5       2,510     (13.1)       2,765
                                                                              
    Latin America                       7.4         324        3.1         422
                                                                              
    North America                     376.9       2,573      333.7       2,923
                                                                              
    Asia Pacific                      116.2       1,382      118.6       1,522
                                                                              
    Other                               6.0         137        6.2         215
                                                                              
Group                                 589.8       8,088      335.4       9,270

The reconciliation of operating assets to net liabilities is as follows:       
                                                                               
                                                               2003        2002
                                                                               
                                                                 £m          £m
                                                                               
Operating assets                                              589.8       335.4
                                                                               
Tax, dividends and net interest payable                     (290.2)     (166.6)
                                                                               
Capital employed                                              299.6       168.8
                                                                               
Net borrowings                                              (859.8)   (1,057.9)
                                                                               
Net liabilities                                             (560.2)     (889.1)

                                                                 Attachment (j)

                                 EMI Group plc                                 

                        NOTES TO THE ACCOUNTS continued                        

                       for the year ended 31 March 2003                        

NOTE 3 - EXCEPTIONAL ITEMS

(i) Operating exceptional items

                                                            2003           2002
                                                                               
                                                              £m             £m
                                                                               
Release of overprovision for reorganisation costs            6.0              -
charged in prior year                                                          
                                                                               
Restructuring and reorganisation costs                                         
                                                                               
   Headcount reduction                                     (6.0)         (93.7)
                                                                               
   Roster reduction **                                         -         (69.4)
                                                                               
Impact of economic downturn in Latin America ***               -         (16.7)
                                                                               
Restructuring of satellite label activity ****                 -         (40.5)
                                                                               
Asset impairment and other*                               (24.9)         (22.1)
                                                                               
Total operating exceptional items                         (24.9)        (242.4)
                                                                               
*Including write-downs of music copyrights (£6.5m), goodwill (£12.1m), current 
asset investments (£2.5m) and investments own shares (£3.8m) in 2003. Including
goodwill (£5.7m) and relocation and other costs (£16.4m) in 2002.              
                                                                               
**Includes £39.3m relating to the termination of the recording contract with   
Mariah Carey.                                                                  
                                                                               
***Resulted in significantly increased returns and bad debts.                  
                                                                               
****Including goodwill (£23.6m) and associate investment (£15.5m) write-offs.  

The attributable taxation credit relating to operating exceptional items is £  
nil (2002: £7.8m).                                                             

(ii) Non-operating exceptional items

                                                          2003           2002
                                                                             
                                                            £m             £m
                                                                             
Profit on sale of holding in HMV Group plc,              215.2              -
including goodwill of £262.5m                                                
                                                                             
Loss on sale of subsidiary undertaking,                 (25.2)              -
including goodwill of £8.4m                                                  
                                                                             
Net gain (provision for loss) on sale of fixed            19.7              -
assets *                                                                     
                                                                             
                                                         209.7              -
                                                                             
The attributable taxation charge relating to                                 
non-operating exceptional items is £38.4m (2002:                             
£nil)                                                                        
                                                                             
* Including a provision for loss on disposal of                              
£(1.8)m and a gain on sale of Viva of £28.0m                                 
                                                                             

                                                                 Attachment (k)

                                 EMI Group plc                                 

                        NOTES TO THE ACCOUNTS continued                        

                       for the year ended 31 March 2003                        

NOTE 4 - FINANCE CHARGES

                                        2003        2003        2002        2002
                                                                                
                                          £m          £m          £m          £m
                                                                                
Interest payable on:                                                            
                                                                                
    Bank overdrafts and loans           61.8                    55.9            
                                                                                
    Other                               18.6                    15.0            
                                                                                
                                                    80.4                    70.9
                                                                                
Interest receivable on:                                                         
                                                                                
    Bank balances                      (2.3)                   (2.7)            
                                                                                
    Other                              (2.0)                   (7.8)            
                                                                                
                                                   (4.3)                  (10.5)
                                                                                
Group finance charges (incl                         76.1                    60.4
associates)                                                                     
                                                                                
Joint venture (HMV Group) -                          1.2                    22.8
discontinued                                                                    
                                                                                
Total finance charges                               77.3                    83.2
                                                                                
Finance charges for associates are £nil (2002: £nil).                           

NOTE 5 - TAXATION

                                                            2003           2002
                                                                               
                                                              £m             £m
                                                                               
Current tax:                                                                   
                                                                               
    UK corporation tax                                      37.7           10.8
                                                                               
    Advance corporation tax written back on                    -         (20.6)
    ordinary activities                                                        
                                                                               
    Double taxation relief                                 (4.9)          (6.7)
                                                                               
                                                            32.8         (16.5)
                                                                               
     Withholding tax                                         8.5           12.1
                                                                               
     Other foreign tax                                      49.4           36.4
                                                                               
     Adjustment in respect of prior periods               (11.5)          (4.3)
                                                                               
    Joint venture                                          (0.3)            7.4
                                                                               
     Total current tax                                      78.9           35.1
                                                                               
Deferred tax:                                                                  
                                                                               
     Origination and reversal of timing                      4.2            2.6
     differences                                                               
                                                                               
Others:                                                                        
                                                                               
     Associated undertakings                                 0.1            0.5
                                                                               
Tax on profit on ordinary activities                        83.2           38.2
                                                                               
There is a tax charge on exceptional items of £(38.4)m (2002: £7.8m credit).   

NOTE 6 - DIVIDENDS (EQUITY)

                                        2003        2002       2003       2002
                                                                              
                                   per share   per share         £m         £m
                                                                              
Ordinary dividends (net):                                                     
                                                                              
    Interim                            2.00p       4.25p       15.8       33.5
                                                                              
    Adjustment to 2003 and 2002            -           -          -      (0.2)
    interim                                                                   
                                                                              
    Proposed final                     6.00p       3.75p       47.2       29.6
                                                                              
    Adjustment to 2002 and 2001            -           -      (0.2)      (0.7)
    final                                                                     
                                                                              
                                       8.00p       8.00p       62.8       62.2
                                                                              
The final dividend of 6.00p per share will be paid on 3 October 2003 to       
shareholders on the register at the close of business on 5 September 2003.    

                                                                 Attachment (l)

                                 EMI Group plc                                 

                        NOTES TO THE ACCOUNTS continued                        

                       for the year ended 31 March 2003                        

NOTE 7 - EARNINGS PER ORDINARY SHARE

                                                         2003              2002
                                                                               
Basic earnings per Ordinary Share is calculated as follows:                    
                                                                               
     Earnings                                         £229.7m         £(199.5)m
                                                                               
     Weighted average number of Ordinary Shares        784.0m            782.8m
     in issue                                                                  
                                                                               
     Earnings per Ordinary Share                        29.3p           (25.5)p
                                                                               
Diluted earnings per Ordinary Share is calculated as follows:                  
                                                                               
     Earnings                                         £229.7m         £(199.5)m
                                                                               
     Adjusted weighted average number of               784.4m            783.6m
     Ordinary Shares                                                           
                                                                               
     Earnings per Ordinary Share                        29.3p           (25.5)p
                                                                               
Adjusted basic earnings per Ordinary Share is calculated as follows:           
                                                                               
     Adjusted earnings                                £122.2m            £92.1m
                                                                               
     Weighted average number of Ordinary Shares        784.0m            782.8m
     in issue                                                                  
                                                                               
     Adjusted earnings per Ordinary Share               15.6p             11.8p
                                                                               
Adjusted diluted earnings per Ordinary Share is calculated as follows:         
                                                                               
     Adjusted earnings                                £122.2m            £92.1m
                                                                               
     Adjusted weighted average number of               784.4m            783.6m
     Ordinary Shares                                                           
                                                                               
     Adjusted earnings per Ordinary Share               15.6p             11.8p
                                                                               
Adjusted earnings are included as they provide a better understanding of the   
underlying trading performance of the Group on a normalised basis.             
                                                                               

RECONCILIATION OF ADJUSTED EARNINGS                                            
                                                                               
                                                      2003                 2002
                                                                               
                                             £m  Per Share         £m Per Share
                                                                               
Earnings/basic EPS                        229.7      29.3p    (199.5)   (25.5)p
                                                                               
Adjustments:                                                                   
                                                                               
    Operating exceptional items            24.9       3.2p      242.4     31.0p
                                                                               
    Non-operating exceptional items     (209.7)    (26.8)p          -         -
                                                                               
    Share of operating exceptions in          -          -       10.3      1.3p
    joint venture                                                              
                                                                               
    Share of exceptional finance              -          -        2.1      0.3p
    charges in joint venture                                                   
                                                                               
    Amortisation of goodwill and           42.8       5.5p       51.3      6.5p
    music copyrights                                                           
                                                                               
    Attributable taxation to               38.4       4.9p      (7.8)    (1.0)p
    non-operating exceptional items                                            
                                                                               
    Minority interest (re music           (3.9)     (0.5)p      (4.3)    (0.5)p
    copyright amortisation)                                                    
                                                                               
    Minority interest (re operating           -          -      (5.3)    (0.7)p
    exceptional)                                                               
                                                                               
    Minority interest (re                     -          -        2.9      0.4p
    attributable taxation)                                                     
                                                                               
Adjusted earnings/adjusted EPS            122.2      15.6p       92.1     11.8p
                                                                               
Adjusted dilution impact                    n/a          -        n/a         -
                                                                               
Adjusted earnings/adjusted diluted        122.2      15.6p       92.1     11.8p
EPS                                                                            
                                                                               
The adjusted weighted average number of Ordinary Shares used in the diluted    
earnings per share calculations, 784.4m (2002: 783.6m), is the weighted average
number of Ordinary Shares in issue, 784.0m (2002: 782.8m), plus adjustments for
dilutive share options, 0.4m (2002: 0.8m).                                     

                                                                 Attachment (m)

                                 EMI Group plc                                 

                        NOTES TO THE ACCOUNTS continued                        

                       for the year ended 31 March 2003                        

NOTE 8 - BORROWINGS

                                                              2003        2002
                                                                              
                                                                £m          £m
                                                                              
LONG-TERM BORROWINGS                                                          
                                                                              
Bank loans and debt finance                                  922.4       374.1
                                                                              
Finance leases                                                 1.5         2.0
                                                                              
Less: repayable within one year                              (1.9)       (2.8)
                                                                              
Total long-term borrowings                                   922.0       373.3
                                                                              
SHORT-TERM BORROWINGS                                                         
                                                                              
Loans and overdrafts                                          35.9       767.4
                                                                              
Finance leases                                                 0.7         0.8
                                                                              
Short-term element of long-term loans                          1.9         2.8
                                                                              
Total short-term borrowings                                   38.5       771.0
                                                                              
Total borrowings                                             960.5     1,144.3
                                                                              
Liquid funds:                                                                 
                                                                              
    Investments: liquid funds                                (0.5)       (0.7)
                                                                              
    Cash at bank and in hand and cash deposits             (100.2)      (85.7)
                                                                              
Net borrowings                                               859.8     1,057.9
                                                                              
Long-term borrowings include £166.8m (2002: £18.4m) of borrowings repayable   
within one year, which are drawings under long-term committed facilities and, 
therefore, have been classified as such.                                      
                                                                              
Under their banking arrangements, overdraft and cash balances of the Company  
and of certain subsidiaries are pooled or offset and cross-guaranteed. Such   
pooling and offsets are reflected in the Group balance sheet as appropriate.  
                                                                              
The Group has cash balances of £20.7m held with banks within the UK and £80m  
held with banks outside, but freely transferrable to, the UK.                 

Maturity analysis of long-term borrowings:                                    
                                                                              
                                                              2003        2002
                                                                              
                                                                £m          £m
                                                                              
Amounts falling due after more than one year are                              
repayable as follows:                                                         
                                                                              
    Between one and two years                                169.1         2.8
                                                                              
    Between two and five years                                59.6        19.7
                                                                              
    After five years:                                                         
                                                                              
        By instalments                                        39.3           -
                                                                              
        Other                                                654.0       350.8
                                                                              
                                                             922.0       373.3
                                                                              
The amount of debt, any of which falls due for payment after more than five   
years, is £693.3m (2002: £350.8m).                                            

                                                                 Attachment (n)

                                 EMI Group plc                                 

                        NOTES TO THE ACCOUNTS continued                        

                       for the year ended 31 March 2003                        

NOTE 9 - CASH, LIQUID RESOURCES AND FINANCING

The following definitions have been used:                                      
                                                                               
CASH: Cash in hand and deposits repayable on demand if available within 24     
hours without penalty and including overdrafts.                                
                                                                               
LIQUID RESOURCES: Investments and deposits, other than those included as cash, 
which are readily convertible into known amounts of cash.                      
                                                                               
FINANCING: Borrowings, less overdrafts, which have been treated as cash.       

Analysis of movement in the Group's net borrowings in the year ended 31 March   
2003:                                                                           
                                                                                
                                     Cash flow Acquisitions  Exchange           
                                                 /disposals  movement           
                                                                                
                           At 1.4.02                                         At 
                                                                        31.3.03 
                                                                                
                                  £m        £m           £m        £m        £m 
                                                                                
Cash at bank and in hand        84.4      13.8            -       1.7      99.9 
                                                                                
Overdrafts                    (40.7)      15.8            -     (0.1)    (25.0) 
                                                                                
Cash                            43.7      29.6            -       1.6      74.9 
                                                                                
Debt due after more than     (371.3)   (558.4)            -       9.2   (920.5) 
one year                                                                        
                                                                                
Debt due within one year     (729.5)     712.4        (4.3)       8.6    (12.8) 
                                                                                
Finance leases                 (2.8)       0.9            -     (0.3)     (2.2) 
                                                                                
Financing                  (1,103.6)     154.9        (4.3)      17.5   (935.5) 
                                                                                
Investments: liquid funds        0.7     (0.2)            -         -       0.5 
                                                                                
Cash deposits                    1.3     (0.9)            -     (0.1)       0.3 
                                                                                
Liquid resources                 2.0     (1.1)            -     (0.1)       0.8 
                                                                                
Total                      (1,057.9)     183.4        (4.3)      19.0   (859.8) 
                                                                                
Cash flow on financing of £154.9m is split between new loans of £(603.5)m,      
loans repaid of £757.5m and capital element of finance leases repaid of £0.9m.  

The Group's net borrowings at 31 March 2003 comprised:                         
                                                                               
                                                Cash        Liquid          Net
                                                       resources &   borrowings
                                                         financing             
                                                                               
                                                  £m            £m           £m
                                                                               
Investments: liquid funds                          -           0.5          0.5
                                                                               
Cash at bank and in hand and cash               99.9           0.3        100.2
deposits                                                                       
                                                                               
Borrowings due within one year                (25.0)        (13.5)       (38.5)
                                                                               
Borrowings due after more than one year            -       (922.0)      (922.0)
                                                                               
At 31 March 2003                                74.9       (934.7)      (859.8)
                                                                               
At 31 March 2002                                43.7     (1,101.6)    (1,057.9)

                                                                 Attachment (o)

                                 EMI Group plc                                 

                        NOTES TO THE ACCOUNTS continued                        

                       for the year ended 31 March 2003                        

NOTE 10 - OTHER PROVISIONS FOR LIABILITIES AND CHARGES

                              Trading  Pensions  Disposal & Acquisition   Total
                                                fundamental         and        
                                                            integration        
                                                    reorg'n                    
                                                                               
                                   £m        £m          £m          £m      £m
                                                                               
At 31 March 2002                121.1      32.6         4.0        15.4   173.1
                                                                               
Currency retranslation          (2.3)       3.9           -       (1.5)     0.1
                                                                               
Provisions utilised            (74.9)     (8.0)       (1.6)       (0.8)  (85.3)
                                                                               
Charged against:                                                               
                                                                               
    Operating profit              4.8       4.9           -           -     9.7
                                                                               
    Exceptional items               -         -         5.0           -     5.0
                                                                               
Disposal of businesses          (0.2)         -           -           -   (0.2)
                                                                               
Reclassification                  2.0         -           -           -     2.0
                                                                               
31 March 2003                    50.5      33.4         7.4        13.1   104.4

The pension provisions arise in overseas companies in respect of state schemes 
and employees covered by the Group's unfunded schemes.                         
                                                                               
Trading provisions include royalty audit and other trading provisions charged  
through operating profit before exceptional items, and restructuring and       
reorganisation provisions charged through operating exceptional items.