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  Print      Mail a friend       Annual reports

Tuesday 05 December, 2006


Final Results

05 December 2006

5 December 2006
For Immediate Release

                                 ITE GROUP PLC


                          STRONG DEMAND DRIVES GROWTH 


                                     Year ended          Year ended
                                 30 September 2006   30 September 2005

Turnover                               £82.4m               £78.5m

Profit before tax                      £24.8m               £25.2m

Headline pre-tax profit*               £26.0m               £25.3m

Diluted earnings per share              6.7p                 6.6p

Headline diluted earnings per share**   7.0p                 6.6p

Dividend per share                      3.5p                 2.75p

•         Strong growth in demand for exhibitions in core markets
•         Biennially adjusted turnover up 16% #
•         Biennially adjusted headline profits up 25% #
•         New launches and contributions from acquisitions delivering as planned
•         'Like for like' forward sales at 1 December 2006 up more than 10%
•         Dividend for year of  3.5p up 27%

Commenting on the results, Iain Paterson, Chairman, said:

'Our successful strategy of leveraging the market leading positions we have
developed in our core markets has delivered another strong set of results. The
growth in both turnover and underlying profitability has been largely driven by
organic development of our exhibitions, supplemented by the initial contribution
from the Footwear and AgriHort acquisitions made in the last financial year.'

'The growing strength and stability of the Russian and CIS economies has
stimulated demand from both local and international businesses to exhibit their
goods and services at our events. This, coupled with the opportunities presented
by increases in venue space in our core markets, will support growth in our
exhibition portfolio into 2007 and beyond. The new financial year has commenced
well, in line with our expectations, and the Board remains confident of the
prospects for the year.'

*  Headline pre-tax profit is defined as profit before tax, amortisation of
acquired intangibles and profits or losses arising on disposal of group
undertakings - see Note 3 for details.

**  Headline diluted earnings per share is calculated as profit attributable to
equity holders adjusted for amortisation of acquired intangibles and profits or
losses arising on disposal of Group undertaking, - see Note 3 for details.

#  Biennially adjusted figures exclude the effect of significant non-annual

Ian Tomkins                                  ITE Group plc                       020 7596 5000
Charles Palmer/Tim Spratt                    Financial Dynamics                  020 7831 3113

ITE Group plc

Preliminary statement for the year ended 30 September 2006

Chairman's Statement

Group Performance

The Group has produced another impressive trading and financial performance for
the 2006 financial year.

Turnover of £82.4 million was a 5% improvement on last year's reported turnover
of £78.5 million, and headline profit before tax of £26.0 million was ahead of
the re-stated result for last year (£25.3 million).  This result was achieved
despite lower interest income following last year's share buyback and the £4.9
million contribution in 2005 from non-annual events. Reported profit before tax
was £24.8 million (2005: £25.2 million) and fully diluted earnings per share
improved to 6.7p per share (2005: 6.6p).

Strategic Progress

During the year the Group has continued to implement its strategy of pursuing
organic growth and strengthening ITE's market leadership in key industry sectors
supplemented through selective earning enhancing acquisitions.  In addition, the
excellent long-term relationships with our venues continue to be of significance
to our business.  In Moscow the construction event, Mosbuild, grew into the
newly constructed exhibition space at Crocus, and in Almaty, Kazakhstan, the
Kazbuild construction event was able to expand into the newly completed, ITE
supported, pavilion.  In Kyiv the larger events, KievBuild and AgriHort, were
both able to grow into the second phase development at the IEC venue which was
completed in January 2006.

It is through the proven and established success of our sales and organising
teams that ITE is now the independent exhibition organiser of choice for venues
in our markets.  Looking forward, I see another year of continued growth built
upon the relationships and contracts we have established.

Board and Management

There have been a number of changes to the Board during the year.  Marco Sodi
stepped down in January following the sale by Veronis Suhler Stevenson of its
remaining shareholding in the Company.  Malcolm Wall joined the Board as a
non-executive Director on 4 May 2006, and is a member of the Audit and
Remuneration Committees. Malcolm brings extensive experience in the
international B2B media and exhibitions business.  Since the year-end Ceyda Erem
has tendered her resignation as an ITE Board Director, although she will remain
Managing Director of our associate business in Turkey.

Ian Tomkins has informed the Board that he wishes to relinquish his role as
Chief Executive at the end of 2007 for personal reasons.  The Nomination
Committee will shortly be starting a process to find his successor and will be
meeting both internal and external candidates.  During his tenure Ian has made
an immense contribution to the remarkable success of the Group.

I would like to express my thanks to the management and staff throughout the
territories who have worked so hard to make this result achievable.   We employ
650 people of whom over 75% are local nationals, employed and working in Russia,
the CIS and Turkey.


The Board has proposed a final dividend of 2.5p per share, making a total
dividend for the year of 3.5p.  This reflects an increase of more than 25% over
last year's total dividend and is in line with the Board's policy of increasing
dividends in line with the underlying earnings growth.


The continued expansion of the exhibition industry in Russia and the CIS which
has fuelled ITE's growth over the last few years is set to continue.  Strong
economic conditions, ITE's recognised international brands, our market leading
position and our dedicated and conscientious staff all place us in a very strong
position to drive our business forward.

Iain Paterson
4 December 2006

Chief Executive's review

Results for 2006 Financial Year

Turnover for the year was £82.4 million (2005: £78.5 million). After making
adjustment for the effect of biennial events this is a 16% improvement over last
year's comparable turnover. This year's turnover includes an initial £2.7
million contribution of revenue from the Footwear and Kiev AgriHort acquisitions
made in the last financial year.  These events contributed £1.2 million to gross
profits.  The 'like for like' revenue growth (excluding the effect of biennial
events and acquisitions in the year) achieved this year on our portfolio of
events was 13%.

The direct costs of exhibitions were well controlled in 2006 and as a result the
gross margin of 46.7% was circa 1% higher than the gross margin achieved on last
year's portfolio of events.

Operating costs before amortisation charges of £14.1 million were 10% higher
than the comparative charge for last year (2005: £12.8 million).  Operating
costs this year include the higher costs of expensing Performance Share Plans
and Option Plans of £1.6 million (2005: £1.1 million), but this is partially
offset by the release of a £0.3 million provision, originally made in 2003
against a venue loan.

The associate business in Turkey delivered a result of £0.6 million (2005: £0.4
million) despite a reduced contribution from its textile exhibitions.

Income from interest and finance was reduced following the £30 million share
buyback executed in August 2005. Interest income was consequently reduced by
approximately £1.3 million.  Finance income includes the release of £0.4 million
of 'notional imputed interest receipts' relating to certain venue loans under
IFRS fair value accounting standards.

Headline profit before tax this year of £26.0 million was ahead of last year's
headline profit before tax of £25.3 million and, after adjusting for the effect
of biennial events, represents a 25% increase over the comparable result for

The Group's overall operating metrics for its events business (excluding
publishing) are set out below:

                                                Square                           Gross       Average yield
                                             metres sold        Revenue         profit             £
                                                000's             £m              £m

2005    Results from Events                     340.9            77.3            35.6
        Non annual 2005                         -23.9            -10.0           -4.9
2005    'Biennially adjusted'                   317.0            67.3            30.7             212
        Acquisitions                             20.9             2.7             1.2
        'Like for like' growth                   42.7             8.3             5.4
2006    'Biennially adjusted'                   380.6            78.3            37.3             206
        Non annual 2006                          45.0             2.3             0.4
2006    Results from Events                     425.6            80.6            37.7

In 2006 the Group organised 146 events (2005: 152 events) in fifteen countries
(2005: sixteen countries) from its nineteen dedicated offices.  There were
sixteen new launches in the year contributing a total £2.0 million in revenue
and £0.5 million in gross profits.

The Group sold 425,600m(2) of exhibition space in 2006 (2005: 340,900m(2)).
After adjusting for the effect of biennial events the Group achieved a 20%
increase in volume sales, a 16% increase in revenues and a 21% improvement in
gross profits from the events it organised in 2006.

The average yield across the Group achieved on comparable sales was 3% lower
this year at £206 per m(2) (2005 comparable yield: £212 per m(2)).  This was
expected as half of the dilution in yield was attributable to the average yields
of the new acquisitions; a quarter of the dilution in yield related to the
re-pricing of the Moscow International Motor Show, and the remaining quarter was
caused by strong volume growth from regions outside Moscow, where in general,
average yields are lower.

Divisional Review

'Like for like' growth (excluding the effect of biennial events and
acquisitions) in revenue   was 13% across ITE's total business.  The strongest
growth was in Central Asia where both profits and revenue increased by over 25%.
Russia and Eastern & Southern Europe also performed above expectations. The
table below sets out the biennially adjusted and 'like for like' growth in
revenues across the regions of ITE's business.

                                    2006        2005        Actual      Biennially     'Like for like'
                                     £m          £m         change       adjusted          growth

Russia                              49.9        48.4          3%            11%              11%
Central Asia & Caucasus             15.4        12.1         27%            27%              27%
Eastern & Southern Europe           8.3         5.0          66%            42%              32%
UK & Western Europe                 7.8         6.0          30%            30%              -3%
Rest of World                       1.0         7.0          -86%          -23%             -23%

                                    82.4        78.5          5%            16%              13%

'Biennially adjusted' excludes the effect of biennial events

'Like for like' growth excludes the effect of biennial events and acquisitions
in the year


Offices:    Moscow, St Petersburg

Staff employed:                          2006:    191
                                         2005:    188

Exhibitions organised:                   2006:    44
                                         2005:    40

Square metres sold (000's):              2006:    206
                                         2005:    194

The market conditions in Moscow and St Petersburg were strong with most
exhibitions reflecting higher demand.  In Moscow the second pavilion at Crocus,
which was completed in 2005, added an extra 60,000m(2) of available gross space
to the market's international quality exhibition space.  Accordingly there was
resultant change in the Moscow market with new launches and venue changes across
the industry, as organisers responded to the increase in space and increased
choice of venue.  In St Petersburg there has been relative stability and little
change in established trading patterns.  However the draw of Moscow's large
events for the major international exhibitors is causing St Petersburg to evolve
into a more regional exhibition business.

In ITE's Moscow business the highlight of the year was the further expansion of
the market leading construction event, Mosbuild.  At 68,300m(2) (2005: 54,400m
(2)) across the two leading exhibition venues this event is now Moscow's, and
Russia's, largest trade exhibition.

Of our other major international events in Moscow the Moscow International
Travel and Tourism exhibition held in Expocentr was solid in response to
competition this year from a new event launch at Crocus. It recorded marginal
growth to 19,600m(2) (2005: 19,300m(2)) at a slightly reduced overall yield. The
Moscow International Motor Show, focused on the B2B motor accessories, service
and parts industries, took place for the first time in the new Crocus venue
alongside the OICA consumer motor show, Autosalon.  As part of this
re-positioning the Moscow International Motor Show agreed a common pricing
policy with the Autosalon event together with a lower venue cost to ITE. The
event was bigger at 17,700m(2) (2005: 16,900m(2)) but yields were lower than the
2005 comparatives. However the new format was well received by visitors and
exhibitors alike.  Following the move to Crocus, pricing for the Moscow
International Motor Show is likely to stabilise.  Worldfood Moscow, held in
Expocentr, continues to perform well and has become the leading specialist event
in the trade food sector now occupying 22,200m(2) of space (2005: 20,300m(2)).
Expoelectronica, the leading electrical components event, moved to the Crocus
venue to secure more and better quality space. The event grew by over 20% to
9,000m(2) (2005: 7,400m(2)) and is now one of ITE's top five contributing events
in Moscow.

There have been a number of successful new launches in Moscow this year.
Babytime is a consumer focused event; MIBS Autumn an 'on the water' summer boat
event supplementing our Spring Boat Show.  Since the year end a new launch of an
Autumn travel event, Select Travel, and the transfer of our pharmaceuticals
event to Crocus have both proved successful initiatives.  Additionally ITE
acquired two new events in June this year.  Expoclean Moscow has a focus on the
industrial cleaning industry and Bytchemexpo focuses on household chemicals.
Expoclean took place in November and performed ahead of expectations;
Bytchemexpo will take place in March next year.

In St Petersburg most of the exhibitions reported steady growth.  The major
event in the calendar is Balticbuild which was unchanged in size at 10,200m(2)
(the event is space constrained), but improved its revenues and profits.  There
was one small new launch, Subcontracting, supported by the City Government.

Looking forward there is a new pavilion being built at Expocentr which will
provide much needed space for our Expocentr based events to expand. This will
add a further 8,000m(2) gross space and is due for completion in early 2007.
Crocus has also commenced construction of a third pavilion, designed to provide
at least 60,000m(2) gross.  With more new space available the Moscow exhibition
business is well positioned to deliver further growth.

Central Asia & Caucasus

Offices:    Kazakhstan (Almaty, Astana, Atyrau) Azerbaijan (Baku), Uzbekistan 
            (Tashkent), Georgia (Tbilisi), Kyrgyzstan (Bishkek), Tajikistan

Staff employed:                          2006:    183
                                         2005:    134

Exhibitions organised:                   2006:    59
                                         2005:    63

Square metres sold (000's):              2006:    72
                                         2005:    59

All offices in Central Asia experienced strong demand and excellent year on year
revenue growth of more than 25% was achieved across the whole region.  There
have been no marked changes in the competitive environment.  In Almaty, Atakent,
the venue owner, successfully completed a new pavilion ready for our use in
September 2006, but there have been no other significant changes in venue
facilities elsewhere in Central Asia.  A new office was opened in Kyrgyzstan in
the year.

One highlight of the year was the new launch of Kazbuild Spring in Almaty which
delivered 4,100m(2).  Our regular Kazbuild (Autumn) event was able to utilise
the newly constructed pavilion and grow to 10,800m(2) (2005: 8,300m(2)).  Total
sales to the construction sector in Almaty have almost doubled in this financial
year, testimony to the underlying strong demand.  The strength of the
construction sector was in evidence throughout the region with revenue growth at
Atyraubuild (10%), Astanabuild (21%), Bakubuild (30%) and Uzbuild (14%) all
recording positive year on year growth.

In October 2005, the Kazakhstan International Oil and Gas exhibition and
conference grew by 7% to 7,900m(2) (2005: 7,400m(2)). Since the year-end the
October 2006 edition has been held and grew by 20% into the newly constructed
pavilion. Oil and Gas events have again been strong performers throughout the
region with the North Caspian event in Atyrau, Kazakhstan, Oil and Gas
Uzbekistan and the Caspian Oil and Gas exhibition in Azerbaijan all recording
good year on year revenue growth.

New launch activity continued its momentum.  The eight small start up events and
conferences across the regions will assist to secure ITE's future presence in
these markets as the economic infrastructure evolves.  Events were launched in
construction, banking and financial services and the power industry
(Kazakhstan); and telecoms and travel (Uzbekistan).

The current pattern of business growth in line with economic growth and assisted
by venue development looks set to continue for the foreseeable future.

Eastern and Southern Europe

Offices:    Ukraine (Kyiv), Turkey (Istanbul)

Staff employed:                          2006:    97
                                         2005:    98

Exhibitions organised:                   2006:    32
                                         2005:    35

Square metres sold (000's):              2006:    104
                                         2005:    49

In the Ukraine the second phase development of ITE's preferred venue, IEC, was
completed in January 2006 allowing the newly acquired AgriHort event to expand
into the new space.  The 2006 edition of the event was 9,500m(2), significantly
larger than the 2005 pre-acquisition edition. The construction event, Kievbuild,
also benefited from the new space and reported strong growth of 47% over last
year's show to 7,750m(2).  The Ukraine International Travel and Tourism event
reported growth of 20% in revenue and profit in selling 5,100m(2) (2005: 4,200m
(2)). A strong overall result from the Ukrainian business was achieved in
delivering 20% 'like for like' growth in revenues over the year.

In Turkey our wholly owned business delivered its best contribution to date.
The construction plant and machinery exhibition, Ankomak was held, for the first
time since 2003; this event is over 40,000m(2) but at relatively low yields.
The Turkish business saw good growth in its other exhibitions and in its
outbound sales activity into ITE events across the regions.

Our 50% owned associate business reported total sales of 200,000m(2) and made a
contribution to ITE Group's profits after tax of £0.6 million.  The furniture,
house textiles and machinery tools events all grew well but the decline in the
textile fabric exhibition, as previously advised, held back the overall result.

Western Europe and UK

Offices:    UK (London, Huddersfield), Germany (Hamburg), Holland (Utrecht)

Staff employed:                          2006:    155
                                         2005:    158

Exhibitions organised:                   2006:    6
                                         2005:    4

Square metres sold (000's):              2006:    36
                                         2005:    25

The principal businesses carried out in the UK are the Spring and Autumn Fashion
events, MODA, held at the NEC Birmingham and the related magazine publishing
business.  During the year the recently acquired Footwear UK events were
integrated into the MODA UK business and operational structures.  The core UK
fashion events having enjoyed a successful February show, recorded a decline in
demand in the Menswear section of its August event, reflecting seasonal patterns
as well as circumstances in the UK retail market.  The shortfall was more than
compensated for by strong growth in the Footwear event over its pre-acquisition
size.  Magazine publishing also recorded a good result with revenues up 7% over
the prior year on its portfolio of titles.

This ITE business unit has established a successful model of complementing
magazine advertising and exhibition participation.  The business has been quick
to adapt to industry trends and to grow and consolidate exhibition and magazine
revenue.  36 staff are employed in the North England office running the
exhibition and magazine business.

Of the total staff employed in Western Europe and the UK, 28 are based in
Germany contributing specialist sales onto Russia and the CIS.  The London
office of ITE employs 91 staff split evenly between sales teams and corporate '
head office'.

Rest of the World

Offices:    Algeria (Algiers), China (Beijing)

The principal event running in Africa this year was in Algeria where we
continued our relationship with U.N.C.T.A.D.  Following on from our initial
success we opened a small office in Algiers and entered into a joint venture
with Sonatrach to organise the national oil and gas exhibition and conference in
Oran in November 2007.

ITE has recently opened a small sales office in Beijing with a view to
developing a greater participation from Chinese exhibitors into ITE's Russian
and CIS events. Initial successes have been encouraging.

Future Outlook

ITE's strategy of focussing on achieving maximum organic revenue growth by
leveraging its market leading position in markets where we have expertise
advantage has yielded another strong set of results.

The growing strength and stability of the Russian and the CIS economies,
underpin the growth of domestic and international trade business conducted
within these regions. International and local businesses are increasingly
looking to exhibit their goods and services at the exhibitions which ITE owns.
Growth in the exhibition business has been constrained until recently, by the
lack of suitable international quality exhibition space.  In 2006 the completion
of 75,000m(2) of new venue space across Moscow, Kazakhstan and Ukraine will help
support growth of our exhibition portfolio into 2007 and beyond.  We anticipate
further additional space will become available for use in 2007 in Moscow and
Ukraine.  ITE has, in its markets, a series of recognised market leading brands
across a number of international exhibition sectors. The Group's well
established office and infrastructure network throughout the region means that
it is well placed to fully participate in the anticipated growth of the
exhibition business.

The new financial year has started well with trading in line with the Board's
expectations.  As of 1 December 2006 advance sales for the 2007 financial year
were £54 million (2005: £43 million) an increase in excess of 10% on the
comparable forward sales position this time last year.  The Board remains
confident of the prospect for the current financial year.

Group Financial Review

International Financial Reporting Standards ('IFRS')

The 2006 Financial Statements are reported under IFRS. The comparative figures
for 2005 have been re-stated onto a consistent basis as required. A full
statement reconciling the reported 2005 Financial Statements to the re-stated
2005 Financial Statements is available on the Company's website:

Revenue and gross profit

A detailed analysis of the main changes in revenues and gross profits of the
business is set out in the Chief Executive's review of the business.

Other operating income

Other operating income represents rental income earned from subletting surplus
office space, principally at ITE's London offices.

Finance income

Finance income for the year was £1.4 million (2005: £2.1 million).  This
includes £0.4 million of 'notional interest' imputed in applying IFRS fair value
principles to certain venue loans.  A further amount of £0.05 million of '
notional interest' remains to be credited to the income statement in the next
financial year. The interest from bank deposits reduced to £0.8 million in the
year (2005: £2.0 million) following ITE's £30 million buyback of its own shares
in August 2005.  The Group held average net cash balances of £14.8 million
through the year (2005: £32.9 million).

Finance costs

Finance costs of £0.6 million (2005: £0.6 million) represent the interest cost
of the Group's borrowings in Euro and US Dollar. The Group enters into these
borrowing arrangements as part of its currency hedging activity. At 30 September
2006 the Group had borrowings of €13.0 million, and US$3.7 million.

Tax charge

The tax charge of £7.4 million represents 30% of profit before tax. In this
financial year tax losses of €7 million which the Group had previously treated
as being available to offset against future tax charges, were disallowed by the
Dutch tax authority, leading to an increase in the deferred tax liability in the
period. There has been a reduction in the Group's overall level of tax
provisions. The Group anticipates that for the next year the tax rate will be in
line with the UK Corporation tax rate of 30%, whereby the lower tax rates
typically experienced in our major overseas markets are offset by withholding
tax charges on dividends back to the UK.

Earnings per share

Basic earnings per share increased to 6.9p (2005: 6.7p). Fully diluted earnings
per share increased to 6.7p from 6.6p in the prior year.

The Group achieved Headline diluted earnings per share of 7.0p per share
compared with 6.6p for the year to 30 September 2005. Headline diluted earnings
per share is based upon profit for the financial year before amortisation of
acquired intangible assets and any profits or losses on disposal of Group


The Group has recommended a final dividend of 2.5p for 2006, to bring the total
dividend for the year to 3.5p (2005: 2.75p).

Cash flow

Cash generated from operations in the year was £34.2 million (2005: £29.4
million).  The principal applications of cash were of £7.4 million applied to
venue loans and advances (2005: net receipt £0.4 million) ; £9.1 million was
paid in tax; (2005 : £8.4 million) ; £3.0 million was applied to acquisitions in
the year (2005:£5.8 million)  and £7.1 million was distributed as dividends
(2005: £7.1 million). The result was a net increase in cash balances at the 30
September of £8.1 million.

Net cash at 30 September 2006 was £21.2 million (2005: £13.0 million). Of the
£21.2 million of cash £4.5 million was held in a trust account, which will be
released as certain creditors are paid in full.  At 30 September 2006 £0.5
million of the cash in trust was expected to be released within one year.

Acquisitions & disposals

On 1 March 2006 ITE acquired the Kiev Decor & Gift Exhibition from Expo UA for
consideration of £0.4 million.  The event is held in the Spring and Autumn each

On 29 June 2006 ITE acquired the ExpoClean and BytChemExpo exhibitions in Moscow
from PIK Maxima for a consideration of £1.8 million.  Both events will be held
by ITE for the first time in the year ending 30 September 2007.

On 20 September 2006, ITE bought the remaining 10% minority shareholding in ITE
Moda Limited for consideration of £1.0 million.  ITE now owns 100% of the Moda
fashion and publishing business.

On 29 September 2006 ITE disposed of a subsidiary in Azerbaijan, Caspian Freight
Services LLC, for £0.2 million to Meritex International Freight Services
Limited. The company provided freight services to the Group's exhibitions in
Azerbaijan.  The consideration will be received over the 12 months ending 30
September 2007.

The final deferred receipts of £0.1 million from the sale of ITE's interests in
ACG have been received in the year.  No further amounts remain outstanding

Balance Sheet

The Group's consolidated balance sheet at 30 September 2006 is summarised in the
table below:

                                                   Assets           Liabilities         Net assets
                                                     £m                  £m                 £m

Goodwill and intangibles                            40.3                 -                 40.3
Property, plant and equipment                        1.3                 -                  1.3
Associates                                           1.4                 -                  1.4
Venue advances                                       7.1                 -                  7.1
Cash                                                31.9               (10.7)              21.2
Current assets and liabilities excluding            25.5               (50.7)             (25.2)
cash and venue advances
Provisions                                            -                (2.3)               (2.3)
Deferred tax                                         2.0               (2.1)               (0.1)

Total as at 30 September 2006                       109.5              (65.8)              43.6

Total as at 30 September 2005                       91.3               (59.2)              32.1

Net assets increased to £43.6 million.  The main changes are in goodwill
(increase of £1.6 million), venue advances (increase of £3.3 million) and net
cash (increase of £8.1 million).

Investment and capital expenditure

The Group's capital expenditure on plant and equipment for the year was £0.4
million (2005: £0.4 million) and included exhibition equipment, computer
equipment and associated software.

The Group funds the development of venues and facilities where improved
facilities will enhance the prospects and profitability of our organising
business. The funding can take the form of a prepayment of future venue fees ('
advance payments'), or a loan which can be repaid by cash or by offset against
future venue fees ('venue loan'). Generally the funding brings rights over
future venue use and advantageous pricing arrangements. Venue loans and advance
payments are included under non-current and current assets in the balance sheet.

At 30 September 2006 the Group's Sterling value of the outstanding balances of
advance payments and venue loans was £7.1 million (2005: £3.8 million) as

                      30 September 2005         New            Repayments       30 September 2006
                             £m                 £m                 £m                  £m

Moscow                        -                 5.8               (3.0)                2.8
Kyiv                         1.3                1.1               (0.6)                1.8
Almaty                       0.8                1.1               (0.9)                1.0
St Petersburg                1.4                 -                (0.4)                1.0
Uzbekistan                   0.2                0.3               (0.3)                0.2
Bulgaria                     0.1               0.3*               (0.1)                0.3

Total                        3.8                8.6               (5.3)                7.1

*Release of provision

These balances will be recovered from future venue use within three years except
in Bulgaria and St Petersburg. In St Petersburg part of the advance repayments
relate to future events taking place between 2007 and 2011. ITE is not presently
active in Bulgaria and the loan is being repaid in instalments.


Following the cancellation of the share premium account and buy back and
cancellation of its own shares last year, the Company has a Share Premium
account of £698,000 as at 30 September 2006.  During the year the Company has
purchased 975,833 shares to be held in Treasury. The Company has also issued
1,013,194 ordinary shares of 1p in the year. Of the total new issues 983,000
were pursuant to the exercise of options and yielded aggregate consideration of
£0.6m. The remaining shares were issued as part of Directors' remuneration.

The Employees Share Option Trust ('ESOT') held 9,372,100 (3.6%) of the Company's
issued share capital at the year end (2005: 11,127,000; 4.3%).

Post balance sheet events

There have been no significant post balance sheet events.

Financial risk

The main financial risk facing the Group is foreign currency risk.  The Board
has reviewed and agreed policies to manage financial risk as follows:

Foreign currency risk

The Group is exposed to movements in foreign exchange rates against Sterling for
both trading transactions and for the translation of net assets and the profits
and loss accounts of overseas operations. The principal exposure is to the Euro
and Dollar exchange rates which form the basis of invoicing for our
international customers. During the year the Group experienced net foreign
exchange losses of £0.2 million (2005: £0.7 million). The exchange rate for the
Euro at 30 September 2006 was €1.48:£1 (30 September 2005: €1.46::£1); the
exchange rate for the US Dollar at the year end was $1.88:£1, (30 September
2005: $1.76::£1).

The bulk of the Group's business is in emerging markets and to minimise the
currency risk, the Group prices predominantly in Euros and US Dollars.  A
proportion of total invoicing amount is settled in local currency equivalent,
translated at prevailing rates of at the date of settling invoices.  In 2006 64%
of the Group's sales were priced in Euros and 22% in US Dollars.  Overall 61% of
the Group's cash receipts in financial year ending 30 September 2006 were in
hard currency and 39% was in various local currencies.   The Group has a large
proportion of its revenues and costs denominated in non-Sterling currencies.
Sterling costs exceed Sterling revenues due to the level of UK based costs - in
particular London sales and head office costs.

The Group uses derivative instruments and currency borrowings to protect itself
against the effect of currency fluctuations on its balance sheet. The Group's
policy on derivative instruments is that:

-     it will only hedge up to 80% of the value of anticipated cash flows; and
-     it will not enter into derivative transactions more than 18 months ahead.

At 30 September 2006 the Group had options to sell €15 million spread over the
12 months to 30 September 2007 at a rate of €1.43:£1 (the ''Option Rate').  Were
the exchange rate for the Euro to fall below €1.38:£1 then the Group would be
obliged to sell Euros at the Option Rate.

Over the course of the year the Group has entered into currency borrowing
arrangements to minimise it's exposure to foreign exchange risk. The currency
borrowings can be offset against the matching Sterling deposits. At 30 September
2006 the Group had borrowings of €13.0 million, and US$3.7 million. The cash
balance of £21.2 million at 30 September 2006 is presented net of these

Interest rate risk

The Group finances its operations through cash holdings and debt facilities.
The objective of the Group is to maximise investment income and minimise
interest costs bearing in mind its liquidity requirements.

For short term debt, such as overdraft facilities or debt with a term of less
than six months, fixed or floating rates of interest are used.  For debt with a
term of greater than six months, it is policy that at least 75% must have fixed
rates of interest so as to minimise the Group exposure to interest rate

It is Group policy that surplus cash is not invested in instruments that would
put the capital value at risk.  All invested funds have a determinable rate of

Liquidity risk

The Group policy is to ensure continuity of funding for operational needs
through cash deposits and debt facilities as appropriate.  The key requirement
for the business is to maintain flexibility to allow the Group to take advantage
of opportunities that could arise over the short term. The needs of the business
are determined on a rolling cash flow forecast basis, covering weekly, monthly
and twelve monthly requirements.  Short term flexibility is maintained by
holding cash in current accounts and high liquidity money market funds.  The
Group has overdraft facilities in place both to permit currency borrowing as
part of its foreign exchange management and to allow flexibility in where it
holds its cash balances.

Going concern

After considering the current financial projections for the Group, the Directors
have a reasonable expectation that the Company has adequate resources to
continue its operations for the foreseeable future. For this reason they
continue to adopt the going concern basis in preparing the accounts.

Russell Taylor
Finance Director
4 December 2006

Consolidated income statement
For the year ended 30 September 2006

                                                      2006                2005
                                                      £000                £000
Continuing operations
Revenue                                              82,368             78,547
Cost of sales                                       (43,885)           (42,552)
                                                 __________         __________
Gross profit                                         38,483             35,995
Other operating income                                  278                316
      Administrative expenses before amortisation   (14,112)           (12,848)
     Amortisation of acquired intangibles            (1,330)            (378)
Total administrative expenses                       (15,442)           (13,226)
Profit on disposal of group undertakings                158                221
Share of results of associate                           564                393
                                                 __________         __________
Operating profit                                     24,041             23,699
Finance income                                        1,368              2,068
Finance costs                                          (621)              (596)
                                                 __________         __________
Profit on ordinary activities before taxation        24,788             25,171
Tax                                                  (7,351)            (6,781)
                                                 __________         __________
Profit for the period from continuing operations     17,437             18,390
                                                 __________         __________
Attributable to:
      Equity holders of the parent                   17,401             18,423
      Minority interests                                 36                (33)
                                                 __________         __________
                                                     17,437             18,390
                                                 __________         __________
Earnings per share (p)
Basic                                                   6.9                6.7
Diluted                                                 6.7                6.6
                                                 __________         __________

Consolidated balance sheet
30 September 2006
                                                       2006               2005
                                                       £000               £000
Non-current assets
Goodwill                                             34,406             32,771
Other intangible assets                               5,869              5,989
Property, plant and equipment                         1,269              1,126
Investments in associates                             1,438              1,410
Venue advances and other loans                        3,015              2,216
Deferred tax asset                                    2,022              1,395
                                                ___________        ___________
                                                     48,019             44,907
Current assets
Trade and other receivables                          29,594             22,722
Cash and cash equivalents                            31,883             23,705
                                                ___________        ___________
                                                     61,477             46,427

Total assets                                        109,496             91,334

Current liabilities
Bank overdraft                                      (10,717)           (10,686)
Trade and other payables                            (50,711)           (43,844)
Provisions                                             (907)            (1,064)
                                                ___________        ___________
                                                    (62,335)           (55,594)
Non-current liabilities
Provisions                                           (1,367)            (1,974)
Deferred tax liabilities                             (2,145)            (1,671)
                                                ___________        ___________
                                                     (3,512)            (3,645)

Total liabilities                                   (65,847)           (59,239)
                                                ___________        ___________
Net assets                                           43,649             32,095
                                                ___________        ___________
Capital and reserves
Share capital                                         2,609              2,599
Share premium account                                   698                 38
Merger reserve                                        2,746              2,746
Capital redemption reserve                              291                291
ESOT reserve                                         (3,016)            (3,562)
Retained earnings                                    40,555             29,038
Own shares held                                      (1,142)                 -
Hedge and translation reserve                           889                751
                                                ___________        ___________
Equity attributable to equity holders of the         43,630             31,901

Minority interests                                       19                194
                                                ___________        ___________
Total equity                                         43,649             32,095
                                                ___________        ___________
Consolidated cash flow statement
For the year ended 30 September 2006

                                                       2006               2005
                                                       £000               £000
Cash flows from operating activities
Operating profit                                     24,041             23,699
  Adjustments for:
Depreciation and amortisation                         1,895                826
Other non-cash expenses                                 208                926
Share of associate profit                              (564)              (393)
Gain on disposal of subsidiary                         (158)              (221)
(Decrease)/increase in provisions                      (213)             1,531
                                                 __________         __________
Operating cash flows before movements in             25,209             26,368
working capital
(Increase)/decrease in receivables                     (233)             1,666
Increase in payables                                  9,244              1,355
                                                 __________         __________
Cash generated from operations                       34,220             29,389
Tax paid                                             (9,064)            (8,378)
Venue advances and loans                             (7,422)               436
                                                 __________         __________
Net cash from operating activities                   17,734             21,447

Investing activities
Interest received                                       925              2,085
Dividends received from associates                      422                437
Acquisition of businesses                            (3,026)            (5,785)
Purchase of property, plant and equipment              (422)              (430)
                                                 __________         __________
Net cash used in investing activities                (2,101)            (3,693)

Financing activities
Dividends paid                                       (7,143)            (7,088)
Interest paid                                          (621)              (596)
Share cancellation                                        -            (30,185)
Net cash flow in relation to ESOT shares                541               (724)
Purchase of own shares                               (1,142)                 -
Proceeds from issue of share capital                    634                927
                                                 __________         __________
Net cash flows from financing activities             (7,731)           (37,666)

Net increase/(decrease) in cash and cash              7,902            (19,912)

Net cash and cash equivalents at beginning of        13,019             33,546
Effect of foreign exchange rate changes                 245               (615)
                                                 __________         __________
Net cash and cash equivalents at end of period       21,166             13,019
                                                 __________         __________

                                                       2006               2005
                                                       £000               £000
Comprised of:
Cash and cash equivalents                            31,883             23,705
Bank overdrafts                                     (10,717)           (10,686)
                                                 __________         __________
                                                     21,166             13,019
                                                 __________         __________

Consolidated statement of recognised income and expense
For the year ended 30 September 2006
                                                       2006               2005
                                                       £000               £000

Currency translation difference on net investment 
in subsidiary undertakings                             (197)               750
Gain on cash flow hedge                                 356                  -
Tax on items taken directly to equity                   159                151
                                                 __________         __________
Net income recognised directly in equity                318                901

Transferred to profit or loss on cash flow 
hedges                                                  (22)                 -
Implementation of IAS 39                               (500)                 -

Profit for the period attributable to the 
shareholders                                         17,437             18,390
                                                 __________         __________
Total recognised income and expense for the 
period                                               17,233             19,291
                                                 __________         __________

Attributable to:
     Equity holders of the parent                    17,197             19,324
     Minority interests                                  36                (33)
                                                 __________         __________
                                                     17,233             19,291
                                                 __________         __________


1       Basis of preparation

ITE Group plc has historically prepared its audited annual accounts in
accordance with UK generally accepted accounting practice (UK GAAP). Following
European regulation issued in 2002, the Group now presents its Annual Report and
consolidated accounts in accordance with International Financial Reporting
Standards (IFRS).

The information contained in this preliminary announcement for the year ended 30
September 2006 does not constitute statutory accounts within the meaning of
section 240 of the Companies Act 1985 but has been extracted from those
accounts. The IFRS information for the year ended 30 September 2005 is a
restatement of information extracted from the statutory financial statements
prepared under UK GAAP on the historical cost basis. The statutory financial
statements for the year ended 30 September 2005 have been filed with the
Registrar of Companies and those for the year ended 30 September 2006 will be
filed following the Group's Annual General Meeting. The auditors' report on
those accounts was unqualified and did not contain statements under section 237
(2) or 237(3) of the Companies Act 1985. Whilst the financial information
included in this preliminary announcement has been computed in accordance with
IFRS, this announcement does not itself contain sufficient information to comply
with IFRS. The Group expects to publish its full IFRS financial statements for
the year ended 30 September 2006 in January 2007.

IFRS 1 First-time Adoption of International Financial Reporting Standards
permits companies adopting IFRS for the first time to take some exemptions from
the full requirements of IFRS and also certain elections in the transition
period. The exemptions and elections adopted by the Group are shown in the
Group's Annual Report and Accounts for the year ended 30 September 2005 and are
available on the Group's website together with full
details of the Group's IFRS accounting policies.

2       Dividends
                                                                                   2006          2005
                                                                                   £000          £000
Amounts recognised as distributions to equity holders in the year:

Final dividend for the year ended 30 September 2005 of 1.85p (2004 - 1.65p) per    4,602         4,533
ordinary share
Interim dividend for the year ended 30 September 2006 of 1.0p (2005 - 0.9p) per    2,535         2,544
ordinary share
                                                                              __________    __________
                                                                                   7,137         7,077
                                                                              __________    __________
Proposed final dividend for the year ended 30 September 2006 of 2.5p (2005 -       6,264         4,602
1.85p) per ordinary share
                                                                              __________    __________

The proposed final dividend is subject to approval by shareholders at the Annual
General Meeting and has not been included as a liability in these financial

Under the terms of the trust deed dated 20 October 1998, the ITE Group Employees
Share Trust, which holds 9,372,100 (2005: 11,127,000) ordinary shares
representing 4% of the Company's called-up ordinary share capital, has agreed to
waive all dividends due to it. Further, no dividends will be paid in respect of
own shares held in treasury.

3    Earnings per share

The calculations of basic and diluted earnings per share are based on the Profit
for the financial year of £17.4 million (2005: £18.4 million) and the following
numbers of shares.

Number of shares                                                            2006                     2005
                                                         Number of shares ('000)  Number of shares ('000)
Weighted average number of shares:
For basic earnings per share                                             250,485                  273,134
Effect of dilutive potential ordinary shares                               8,727                    6,788
                                                                     ___________             ___________
For diluted earnings per share                                           259,212                  279,922
                                                                     ___________             ___________

Headline earnings per share

Headline diluted earnings per share is intended to provide a consistent measure
of Group earnings on a year on year basis and is 7.0p per share (2005: 6.6p).
The headline diluted earnings per share is based on the following earnings and
the diluted number of shares in the table above.
Earnings for headline diluted earnings per share                          2006          2005
                                                                          £000          £000

Profit for the financial year attributable to equity holders            17,401        18,423
Amortisation of acquired intangible assets                               1,330           378
Tax effect of amortisation of acquired intangible assets                 (315)          (83)
Profit on disposal of group undertakings                                 (158)         (221)
                                                                      ________      ________
                                                                        18,258        18,497
                                                                      ________      ________

4       Reserves
                                                          Share    Merger      Capital      ESOT    Retained
                                                        premium   reserve   redemption   reserve    earnings
                                                        account                reserve
                                                           £000      £000         £000      £000        £000

1 October 2004                                           29,036     2,746            -   (2,792)      16,637
Exercise of options                                         912         -            -        99        (23)
Net profit for the year                                       -         -            -         -      18,953
Dividends paid                                                -         -            -         -     (7,077)
Gain on foreign currency translation of overseas              -         -            -         -           -
Share based payments                                          -         -            -         -         592
Shares issued for remuneration                               35         -            -         -           -
Deferred tax reserve                                          -         -            -         -         151
Purchase of shares by ESOT                                    -         -            -     (869)           -
Gain on exercise of ESOT options                              -         -            -         -          48
Capital reduction                                      (29,945)         -            -         -      29,945
Purchase and cancellation of shares                           -         -          291         -    (30,188)
                                                      _________   _______    _________   _______   _________
1 October 2005                                               38     2,746          291   (3,562)      29,038
Adoption of IAS 39                                            -         -            -         -       (500)
                                                      _________   _______    _________   _______   _________
Revised 1 October 2005                                       38     2,746          291   (3,562)      28,538

                                                     Treasury     Hedge and  Put option     Total
                                                       shares   translation     reserve
                                                         £000          £000        £000      £000
1 October 2004                                              -             -           -    45,627
Exercise of options                                         -             -           -       988
Net profit for the year                                     -             -           -    18,953
Dividends paid                                              -             -           -   (7,077)
Gain on foreign currency translation of overseas            -           751           -       751
Share based payments                                        -             -           -       592
Shares issued for remuneration                              -             -           -        35
Deferred tax reserve                                        -             -           -       151
Purchase of shares by ESOT                                  -             -           -     (869)
Gain on exercise of ESOT options                            -             -           -        48
Capital reduction                                           -             -           -         -
Purchase and cancellation of shares                         -             -           -  (29,897)
                                                      _______     _________   _________   _______
1 October 2005                                              -           751           -    29,302
Adoption of IAS 39                                          -             -     (1,044)   (1,544)
                                                      _______     _________   _________   _______
Revised 1 October 2005                                      -           751     (1,044)    27,758

                                                          Share    Merger      Capital      ESOT
                                                        premium   reserve   redemption   reserve
                                                        account                reserve
                                                           £000      £000         £000      £000

Revised 1 October 2005                                       38     2,746          291   (3,562)
Exercise of options                                         625         -            -       546
Net profit for the year                                       -         -            -         -
Dividends paid                                                -         -            -         -
Loss on foreign currency translation of overseas              -         -            -         -
Share based payments                                          -         -            -         -
Shares issued for remuneration                               35         -            -         -
Deferred tax reserve                                          -         -            -         -
Increase in fair value of hedging derivatives                 -         -            -         -
Transfer to income                                            -         -            -         -
Costs related to capital reduction                            -         -            -         -
Exercise of put option                                        -         -            -         -
Own shares held in treasury                                   -         -            -         -
                                                      _________   _______    _________   _______
30 September 2006                                           698     2,746          291   (3,016)
                                                      _________   _______    _________   _______

                                                      Retained  Treasury     Hedge and  Put option     Total
                                                      earnings    shares   translation     reserve
                                                          £000      £000          £000        £000      £000

Revised 1 October 2005                                  28,538         -           751     (1,044)    27,758
Exercise of options                                        117         -             -           -     1,288
Net profit for the year                                 17,401         -             -           -    17,401
Dividends paid                                         (7,137)         -             -           -   (7,137)
Loss on foreign currency translation of overseas             -         -         (197)           -     (197)
Share based payments                                     1,492         -             -           -     1,492
Shares issued for remuneration                               -         -             -           -        35
Deferred tax reserve                                       159         -             -           -       159
Increase in fair value of hedging derivatives                -         -           356           -       356
Transfer to income                                           -         -          (22)           -      (22)
Costs related to capital reduction                        (15)         -             -           -      (15)
Exercise of put option                                       -         -             -       1,044     1,044
Own shares held in treasury                                  -   (1,142)             -           -   (1,142)
                                                     _________   _______     _________   _________   _______
30 September 2006                                       40,555   (1,142)           889           -    41,021
                                                     _________   _______     _________   _________   _______

The Company adopted IAS 32 'Financial Instruments: Disclosure and Presentation'
and IAS 39 'Financial Instruments: Recognition and Measurement' prospectively
from 1 October 2005. As a consequence of adopting IAS 32 and IAS 39, the Company
recognised a loss of £0.5 million in equity at that date.  Additionally certain
put options have been reclassified as financial liabilities resulting in a £1.0
million reduction in reserves.

5       Dividend payment dates

Final dividend 2006

Ex date                                              31 January 2007

Record date                                          2 February 2007

Annual General Meeting                               22 February 2007

Payment date                                         2 March 2007

Interim dividend 2007

Record date                                          June 2007

Payment date                                         July 2007

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