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EMI Group PLC (EMI)

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Thursday 20 April, 2006

EMI Group PLC

Trading Statement


20 April 2006

EMI Group provides trading update for the financial year ended 31 March 2006
ahead of the announcement of its preliminary results on 23 May 2006

  * EMI Group expects to report strong growth in profits for the financial year
    ended 31 March 2006, with EMI Music and EMI Music Publishing both 
    outperforming the global recorded music industry
   
  * EMI also announces it has identified an additional £30m of annualised cost
    savings, further aligning the business for the rapidly developing music 
    marketplace driven by digital growth
   
Trading update

Overall, the Group expects to report full year revenue growth of close to 4%,
with digital revenues more than doubling to over £110m. Group profit before
tax, amortisation and exceptional items (`adjusted PBT') is expected to have
increased by approximately 12%.

EMI Music gained market share in the year, outperforming a global recorded
music market which remained challenging in some regions. On a constant currency
basis, the division's revenues are expected to have increased by approximately
2% for the full year, with second half revenues being marginally ahead of the
previous year's level. Digital revenues continued to show rapid growth,
increasing by more than 150% at constant currency and accounted for over 5.5%
of EMI Music's revenues for the full year. This strong divisional performance
reflects successful releases from a broad range of artists including
international superstars Coldplay, Gorillaz, Robbie Williams and The Rolling
Stones, local superstars Radja from Indonesia, Raphael from France and RBD from
Mexico, and breaking artists KT Tunstall, Dem Franchize Boyz and Corinne Bailey
Rae.

Higher revenues combined with the remaining £15m of annualised cost savings
from the March 2004 restructuring initiative and an increasing proportion of
revenues from digital, resulted in a year-on-year improvement in the EMI Music
operating margin of almost one percentage point and operating profit growth of
approximately 15%.

EMI Music Publishing had another successful year and expects to report constant
currency revenue growth of approximately 2.5%. Digital revenues also grew
strongly and accounted for approximately 4.5% of divisional revenues in the
year. As anticipated, operating margin improved significantly in the second
half, resulting in a modest increase in the full year margin.

Cost savings and other initiatives

EMI Group will be implementing a series of initiatives designed to ensure EMI
Music and EMI Music Publishing continue to be best-positioned to operate
effectively and efficiently in the increasingly digital marketplace. These
initiatives will involve most regions and will be focused on improving and
re-aligning resources to ensure the organisation remains flexible and
progressive.

A particular area of focus is EMI Music's Japanese business, where new skills
and a new organisational structure will be introduced to enable the
re-allocation of resources into the key areas of A&R and marketing whilst
maintaining an aggressive approach to digital business development. This
programme is designed to drive increases in both future market share and levels
of profitability.

In conjunction with these restructurings, EMI Music plans to enter into sale
and leaseback agreements for its two Japanese properties and other property in
the US.

EMI Group expects that in total these initiatives will deliver cost savings of
at least £30m per annum. It is anticipated that not less than £10m of these
savings will be delivered in the financial year ending 31 March 2007, with the
full run rate achieved by the end of the following financial year. The total
cash cost of these restructuring initiatives of approximately £60m, will be
more than offset by the cash proceeds from the property disposals.

Notes:

The figures shown are unaudited and hence may vary from the final numbers that
will be reported.

All figures are at statutory rates unless otherwise stated.

All statements relating to profit refer to profit pre exceptional items,
remeasurements and amortisation of music copyrights and intangibles.

Enquiries

EMI Group plc

Amanda Conroy         Corporate Communications    +44 20 7795 7529           
                                                                             
Claudia Palmer        Investor Relations          +44 20 7795 7635           
                                                                             
Susie Bell            Investor Relations          +44 20 7795 7971           
                                                                             
Sonia Shah            Investor Relations          +44 20 7795 7625           

Brunswick Group LLP

Patrick Handley                                   +44 20 7404 5959