EXHIBIT 99.2
[THE DIALOG CORPORATION LETTERHEAD]
Business Editors
THE DIALOG CORPORATION
REPORTS 1998 RESULTS
LONDON and CARY, N.C.--March 18, 1999--The Dialog Corporation plc
(Dialog) (NASDAQ:DIALY, LSE:DLG), a leading provider of Internet-based
information, technology, and eCommerce solutions to the corporate market,
today announced operating results for the fourth quarter and year ended
December 31, 1998. (All figures are according to U.K. G.A.A.P. and have
been converted from G.B.P. ((pound)) to U.S. dollars ($) for information
purposes at the prevailing exchange rate on December 31, 1998 of
1(pound)=$1.6638. All references to pro forma 1997 results denote the
combined results of the M.A.I.D and Knight-Ridder Information businesses.
Operational Highlights:
- -- Built solid foundations to drive future revenues
- -- Strengthened management team
- -- Realigned group into three operating divisions
- -- Launched several new products to critical acclaim
- -- Daily usage volumes continue increasing trend
- -- Acquired Write Works Ltd. in November 1998
- -- Relocated U.S. headquarters to Cary, NC
- -- Reclassified into Internet Subsector by FTSE
Financial Highlights:
- -- 1998 revenues of $284.1 million
- -- 1998 operating profit of $42.6 million
- -- 1998 profit before tax of $13.9 million
- -- 4th Quarter revenues of $65.8 million
- -- 4th Quarter operating profit of $9.3 million
- -- 4th Quarter profit before tax of $1.8 million
- -- Internet based revenues exceeded $100 million in 1998
- -- Achieved annualized cost savings of $47 million
Commenting on the 1998 results, Michael Mander, Chairman of Dialog
said, "1998 was a challenging but productive year for The Dialog
Corporation. Knight-Ridder Information, Inc.'s (KRII) revenues have taken
longer to turn around than we had originally anticipated. This situation
was compounded by the necessary pricing changes we introduced during the
year.
"Nevertheless, we have addressed the fundamental structural
issues created by M.A.I.D's acquisition of KRII and an enormous amount has
been achieved in the integration of the two businesses. We recognize that
the combined Company is not as far along in the process of building
revenues and profits as we had hoped for at the time of the acquisition. We
have recently made important additions to key management, released a number
of promising new products and enhanced our field sales operations with new
staff. We are confident that these and other initiatives will accelerate
the process of revenue and profit growth.
"Our efforts in 1998 have created a profitable and cash generative
Company, which offers an excellent platform from which to develop in the
future.
"We have recently restructured Dialog into three divisions, in
order to retain the focus on our core Information Services business, whilst
at the same time fully capitalizing on the enormous potential of our
proprietary Internet technologies and eCommerce innovations.
"Overall, we expect the real benefits of the work we have done to
date to begin to be reflected in our results in the second half of 1999 and
beyond."
Operational review
Our objective since the merger of M.A.I.D plc and Knight-Ridder
Information Inc. (KRII) in November 1997 has been to combine the former's
advanced technologies and user friendly products with the latter's
unparalleled content to deliver a wide range of information solutions
across our extensive global customer base. We have made considerable
progress during 1998 in the achievement of this objective.
The revenues of KRII had been declining prior to the acquisition.
Although it has taken longer than originally anticipated, management
believes that the results of the Company's efforts to address the decline
are now being demonstrated and this has been further enhanced by the
introduction of a suite of Internet based products introduced in September
1998.
In order to launch these Web based products, as identified at
the time of the acquisition, the traditional pricing structure that had
been in place for 25 years needed to be significantly overhauled.
Management had identified that 24% of revenue, representing in excess of
$50 million, was based on connect time charges. This revenue was vulnerable
due to the fact that the technology upon which the Internet operates does
not allow for comparable time based charging.
Introducing this radical change in pricing proved to be more
problematic than anticipated and resulted in the Company discounting
services by approximately 10% before it was fully adopted. This discount
affects the majority of Dialog revenues and is the reason that usage of our
services appears to be in continued decline. Since September 1998, the
average for daily usage volumes has continued to increase each month up to
and including February 1999, with the exception of December, which is
always impacted by the holidays.
Alongside these pricing changes, we also introduced the option for
customers to switch from pay-as-you-go to flat-fee packages. This option
has proved popular, particularly with the larger global customers, and
flat-fee contracts now represent over 30% of our revenues at an average
premium of 10% year on year.
By the year-end, the pricing changes had been adopted and accepted
by the customer base, new products were launched and the Company had
achieved an operating margin of 15%. Additionally operating profit
increased by 392% to $42.6 million for the full year as compared to $8.7
million for pro forma 1997.
In addition to focusing considerable efforts on driving revenues
in the core business, management is exploring a number of strategic
initiatives, some of which are at an advanced stage of negotiation, which
will also have the effect of reducing the present level of indebtedness
carried by the Company.
These strategic initiatives will enable the Company to accelerate
debt repayments and allow cash flow to propel some of the high growth
opportunities in which the Company has significant technologies,
competencies and the market position to exploit.
Q4 and full year results
Group sales were $284.1 million in 1998, the first full year of
operations following the acquisition of KRII in November 1997.
The integration of KRII and M.A.I.D involved a reduction in
workforce of some 24% and the termination of 16 out of a total 57 office
leases, the cost of which was fully provided for as a restructuring cost in
1997. By reducing the scale of duplicated functions and by aligning the
KRII business model with that of M.A.I.D, management achieved a $47
million, or 33%, reduction in the 1997 half year annualized operating cost
base of the combined entity. This exceeded management's expectations by
$11.6 million.
After net interest expense of $28.7 million, Dialog achieved a
profit before tax (excluding restructuring costs and other exceptional
items) of $13.9 million for 1998, which is below our expectations at the
outset of the merger. It is significantly better, however, than the two
businesses were able to achieve as separate companies in 1997.
The acquisition of KRII required a significant fund raising
exercise which was achieved through a mixture of equity, and $272.5 million
of debt. During the year the Company serviced debt interest of $29.0
million and repaid senior debt in the amount of $15.9 million, to end the
year with total indebtedness of $256.6 million. Given the current level of
debt, relative to the Company's operating performance for 1998, debt
repayment remains a key management objective.
Dialog has obligations in addition to interest charges, to repay
$21.9 million of senior debt in equal installments in May and November
1999. Management continue to look at alternative ways to further reduce
current indebtedness in order that operating cash flows can be used instead
to accelerate the expansion plans for our three newly formed divisions.
The Company complied with its debt covenants during 1998 and
expects to meet its covenants for the current year and beyond. The
Directors are confident that debt obligations arising in the current
financial year can be met from existing bank facilities and forecast
operating cash flows, which include anticipated cash receipts from sizeable
contracts of strategic importance currently under negotiation or that, if
necessary, other sources of finance can be arranged.
Dialog achieved earnings per American Depositary Share (ADS) of
$0.32 before restructuring costs and other exceptional items, compared to a
loss of $0.41 per ADS in 1997.
Restructuring costs and other exceptional items
The restructuring charge booked in 1998 of $4.3 million mainly
relates to the move of our U.S. headquarters from Mountain View to Cary, NC
($3.8 million) and other restructuring items mainly related to the
convergence of our data center operations.
The Board has been closely monitoring its investment in Fourth
Network Inc., which had expected to achieve an IPO or alternative
significant fund raising. As this has not occurred to date, the Board
determined that it would be prudent to write down 50% of its investment,
necessitating an exceptional charge of $3.8 million in 1998.
In 1998, the Company disposed of its non-core investments in
Easynet Group plc and NewsEdge, Inc., realizing gross proceeds of $11.9
million and an exceptional gain of $3.4 million.
Q4 Operating Results
Results for the fourth quarter were broadly in line with
management's expectations. Dialog usage revenues did increase month on
month with the exception of December, which was impacted by normal holiday
usage patterns. Gross margins improved as a result of sales in the Web
Solutions Division which has higher associated gross margins, together with
the greater weighting of Profound re-subscriptions that fall due for
renewal in the fourth quarter. Operating costs increased as new products
were released and additional sales staff employed.
New Products
In order to leverage the market opportunities created by rapid
worldwide growth in Internet usage, a number of our traditional products
were redeveloped in order that they could be accessed via the Internet, in
particular Dialog Classic. We also repackaged access to our vast databases
in the form of a suite of industry-specific solutions known as
DialogSelect.
We have recently introduced three significant new products,
LiveIntranet, Intranet Toolkit and OfficeShopper, which break new ground in
our industry and which offer exciting potential in the future.
We will continue to invest in the development and marketing of new
products over the coming year and are confident that we can maintain our
technological and market leadership position in this dynamic and fast
changing marketplace. However, these new products will inevitably take time
to generate material sales for the Company.
Group realignment
In February we restructured Dialog into three operating divisions:
Information Services, Web Solutions & Internet Software, and eCommerce.
This was done to ensure that we retain the focus on our core Information
Services business, whilst at the same time fully capitalizing on the
enormous potential of our proprietary Internet technologies and eCommerce
innovations.
Information Services Division
This division focuses on the development and expansion of the
existing online information business to information professionals and
end-users. The main product lines include Dialog, DataStar, Profound and CD
ROM. With 9 terabytes of information in some 900 databases serving over
20,000 corporate customers around the world, the Information Services
Division offers the world's largest professional and commercial online
service.
The Information Services Division reported 1998 turnover of $276.2
million, representing 97% of Group turnover. Cost of sales consists
primarily of royalties paid by the Company to content publishers. Other
principal costs include computer processing and telecommunications and
costs. The 1998 gross margin of 56.6% for this division is broadly
representative of this division going forward.
Web Solutions & Internet Software Division
The Web Solutions & Internet Software Division leverages InfoSort,
Dialog's proprietary indexing software, and Muscat's intelligent search
engine technologies, for corporate knowledge management solutions.
InfoSort, used by our Information Services Division and developed
over the past 14 years, has recently achieved a breakthrough and can now
automatically categorize electronic data. This innovation addresses the
market's growing demand for automatic indexing of digital material to
overcome the issue of information overload. We believe that the licensing
of InfoSort software offers considerable revenue potential for this
division.
During 1998 we were successful in winning and implementing
special projects through this licensing of technology with both the UK
Government's Department of Trade and Industry and the British Broadcasting
Corporation. Other customers for the division include Reuters, The British
Library, Ernst & Young, Virgin Net, McGraw Hill and Barclays Bank.
The Web Solutions & Internet Software Division reported 1998
turnover of $7.0 million, representing 2.5% of Group turnover. Sales in
this division consist of license fees and royalties and have minimal
associated direct costs. The 1998 gross margin of approximately 70% is
broadly representative for this division going forward, depending on the
sales mix.
eCommerce Division
In July 1998, Dialog announced its entry into the electronic
commerce market. The strategic focus of this division is on
business-to-business applications and to this end, in November 1998, Dialog
acquired 100% of Write Works Ltd., a company which had developed the UK's
first online purchasing and management control system for businesses.
Our strategy for 1999 and beyond involves the rollout of
OfficeShopper to the business community worldwide leveraging Dialog's
substantial global customer base and licensing the procurement software on
which OfficeShopper is based to other organizations wanting to develop
their own eCommerce activities.
Earlier this month, the eCommerce Division was awarded the
contract to operate the Enterprise Zone, an Internet portal for Small
Medium-sized Enterprises (SME's) by the UK Government's Department of Trade
and Industry in conjunction with Business Links. Enterprise Zone now
includes LinkShopper, a customized version of Dialog's OfficeShopper
service.
Revenues for our eCommerce Division amounted to $166,000 in 1998,
representing the revenue contribution from OfficeShopper (Write Works)
which was launched in mid-November 1998. By comparison, Write Works had pro
forma revenues of $1.25 million for the full year of 1998. The gross margin
in 1998 was 22%, setting the benchmark expectation for our eCommerce
Division's future performance.
Management
This year we have considerably strengthened the senior management
team most notably through the appointment of Patrick Sommers to the new
position of Chief Operating Officer and more recently, Richard Swank as a
non-executive Director.
FTSE Reclassification
Dialog has demonstrated a strong and increasing stream of Internet
revenues generated worldwide which in 1998 amounted to over $100 million.
Accordingly, effective April 1, 1999, Dialog is to be reclassified by FTSE
International as an Internet company and will form a part of the new
Internet subsector on the London Stock Exchange. The new classification
will be a more accurate reflection of the Company's revenue mix and
functions both in the UK market and in the U.S. where Dialog is listed on
NASDAQ.
Current Operating Results & Outlook
Total revenues in January 1999 increased versus both November and
December 1998. Revenue in the first half of 1999 will primarily be driven
by growth in the Information Services Division, which today accounts for
over 95% of Group revenues. Dialog daily usage revenues have continued to
grow in both January and February, albeit from a lower revenue base than
first quarter 1998, due to the effective discount to the service arising
from the pricing structure implemented in the latter part of 1998.
Unlike the quarterly revenue trends of 1998, management expects
the combination of the anticipated growth in daily usage from the
Information Services Division and the growth from our eCommerce and Web
Solutions Divisions to generate successive increased quarterly revenues
regardless of the seasonal impact to usage based sales that will inevitably
arise.
The Board is confident that the actions that we have taken during
1998 will grow shareholder value, although we anticipate that the real
benefits will start to show through in our financial results from the
second half of 1999 and beyond. The Board is also determined to make 1999 a
year of progress for The Dialog Corporation and its shareholders, building
upon the foundations laid by the actions taken during 1998.
The Dialog Corporation (http://www.dialog.com) is a leading
provider of Internet-based information, technology, and eCommerce solutions
to the corporate market, created by the merger of M.A.I.D plc and
Knight-Ridder Information Inc. The Dialog Corporation brands include the
DIALOG, DataStar and Profound range of products and services. These brands
provide comprehensive, authoritative sources of information to
professionals worldwide. The Dialog Corporation has world headquarters in
London and US headquarters in Cary, NC. Its American Depositary Shares
(ADS) are traded on NASDAQ under the symbol "DIALY" with four Ordinary
Shares comprising one ADS; its Ordinary Shares trade on the London Stock
Exchange under the symbol "DLG."
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, which are subject to the "safe harbor"
created by those sections. The forward-looking statements can be identified
by terminology such as "may," "will," "expect," "intend," "estimate,"
"anticipate," "inevitable," "believe" or "continue" or variations thereon,
and include, among others, the launch dates of the Company's products noted
above. The Company's actual results could differ materially from those
discussed in the forward-looking statements as a result of certain factors,
including, among others, those set forth under the caption "Risk Factors"
in the Company's most recent Report on Form 20-F or generally in the
Company's Reports on Form 6-K. The Company disclaims any obligation to
update these forward-looking statements as a result of subsequent events.
The Dialog Corporation plc
Consolidated Profit and Loss Account (Unaudited)
for the year ended December 31 1998
Total Restructuring Total
continuing costs and continuing
business other business
before exceptional after
restructuring items restructuring
costs costs
------------------------------------------------------------------
------------------------------------------------------------------
1998
------------------------------------------------------------------
------------------------------------------------------------------
$000 $000 $000
- --------------------------------------------------------------------
- -------------------------------------------------------------------------
TURNOVER 284,114 - 284,114
Cost of sales (119,158) - (119,158)
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
GROSS PROFIT 164,956 - 164,956
Distribution costs (35,946) 75 (35,871)
Administrative expenses (73,490) (4,372) (77,862)
Amortisation/write off of
development costs (12,912) - (12,912)
Amounts written off
investments - (3,827) (3,827)
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
OPERATING (LOSS)/PROFIT 42,608 (8,124) 34,484
Gain on sale of fixed
asset investment - 3,442 3,442
Interest receivable 341 - 341
Interest payable and
similar charges (29,010) - (29,010)
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
PROFIT/(LOSS) ON
ORDINARY ACTIVITIES
BEFORE TAXATION 13,939 (4,682) 9,257
Taxation on profit/(loss)
on ordinary activities (1,279) - (1,279)
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
PROFIT/(LOSS) ON
ORDINARY ACTIVITIES
AFTER TAXATION 12,660 (4,682) 7,978
Minority equity interests (592) - (592)
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
RETAINED
PROFIT/(DEFICIT) 12,068 (4,682) 7,386
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
Earnings/(loss)
per ADS $0.32 - $0.19
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
ADSs used in
computing earnings/
(loss) per ADS
(thousands) 37,645 - 37,645
CONSOLIDATED STATEMENT OF
TOTAL RECOGNISED GAINS AND
LOSSES (UNAUDITED)
1998
$000
- -------------------------------------------------------------------------
Gain / (loss) for the
financial year 7,386
Consolidated translation
differences on foreign
currency net investments 1,131
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
Total recognised gains and
losses for the
financial year 8,517
- -------------------------------------------------------------------------
Total Restructuring Total
continuing costs and continuing
business other business
before exceptional after
restructuring items restructuring
costs costs
1997 1996
------------------------------------------ ----------
------------------------------------------ ----------
$000 $000 $000 $000
- ------------------------------------------------------------------------ ----------
- ------------------------------------------------------------------------ ----------
TURNOVER 76,671 - 76,671 35,677
Cost of sales (28,561) - (28,561) (12,041)
- ------------------------------------------------------------------------ ----------
- ------------------------------------------------------------------------ ----------
GROSS PROFIT 48,110 - 48,110 23,636
Distribution costs (26,121) (2,184) (28,305) (16,527)
Administrative expenses (22,320) (15,385) (37,705) (16,596)
Amortisation/write off
of development costs (5,920) (13,294) (19,214) (3,610)
Amounts written off
investments - - -
- ---------------------------------------------------------------------- ---------
- ---------------------------------------------------------------------- ---------
OPERATING (LOSS)/PROFIT (6,251) (30,863) (37,114) (13,097)
Gain on sale of fixed
asset investment - 6,713 6,713 -
Interest receivable 562 - 562 1,708
Interest payable and
similar charges (4,156) - (4,156) (314)
- ---------------------------------------------------------------------- ----------
- ---------------------------------------------------------------------- ----------
PROFIT/(LOSS) ON
ORDINARY ACTIVITIES
BEFORE TAXATION (9,845) (24,150) (33,995) (11,703)
Taxation on
profit/(loss) on
ordinary activities (537) - (537) (273)
- ---------------------------------------------------------------------- ----------
- ---------------------------------------------------------------------- ----------
PROFIT/(LOSS) ON
ORDINARY
ACTIVITIES
AFTER
TAXATION (10,382) (24,150) (34,532) (11,976)
Minority equity
interests 18 - 18 (47)
- ---------------------------------------------------------------------- ---------
- ---------------------------------------------------------------------- ---------
RETAINED
PROFIT/(DEFICIT) (10,364) (24,150) (34,514) (12,023)
- ---------------------------------------------------------------------- ---------
- ---------------------------------------------------------------------- ---------
Earnings/(loss)
per ADS ($0.41) - ($1.37) ($0.52)
- ---------------------------------------------------------------------- ----------
- ---------------------------------------------------------------------- ----------
ADSs used in
computing earnings/
(loss) per ADS
(thousands) 25,269 - 25,269 23,149
CONSOLIDATED STATEMENT
OF TOTAL RECOGNISED
GAINS AND LOSSES
(UNAUDITED)
1997 1996
$000 $000
- ------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------
Gain / (loss) for the
financial year (34,514) (12,023)
Consolidated
translation
differences on foreign
currency net
investments (5,156) 59
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Total recognised gains
and losses for
the financial year (39,670) (11,964)
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
The profit and loss accounts shown above have been prepared on a historical
cost basis.
The company maintains its books and records in accordance with UK generally
accepted accounting principles (GAAP). The financial results set forth
above represent the company's financial results under UK GAAP, translated
for convenience into US dollars at the rate of US$:(pound) 1.6638, being
the rate of exchange on December 31, 1998, the last trading day of the
year.
The Dialog Corporation plc
Consolidated Balance Sheet (Unaudited)
as at December 31 1998
1998 1997
$000 $000
- ----------------------------------------------------------------------
FIXED ASSETS
Intangible assets 38,524 35,978
Goodwill 12,771 -
Tangible assets 29,732 32,201
Investments 20,555 30,571
- -------------------------------------------------------------------------
101,582 98,750
- -------------------------------------------------------------------------
CURRENT ASSETS
Stock 368 386
Debtors: amounts due within one year 71,179 71,884
Debtors: amounts due after one year - 1,023
Cash and bank deposits 7,477 22,831
Assets held for resale 1,650 12,286
- -------------------------------------------------------------------------
80,674 108,410
CREDITORS (amounts falling due
within one year) (97,906) (75,205)
- -------------------------------------------------------------------------
NET CURRENT (LIABILITIES)/ASSETS (17,232) 33,205
TOTAL ASSETS LESS CURRENT LIABILITIES 84,350 131,955
CREDITORS (amounts falling due after
more than one year) (232,501) (270,669)
Provisions for liabilities and charges (7,815) (12,617)
- -------------------------------------------------------------------------
NET LIABILITIES (155,966) (151,331)
- -------------------------------------------------------------------------
CAPITAL AND RESERVES - EQUITY
Called up share capital 2,519 2,499
Share premium account 253,111 250,137
Shares to be issued 1,609 -
Profit and loss account (414,997) (405,175)
- -------------------------------------------------------------------------
Equity shareholders' funds (157,758) (152,539)
Minority equity interest 1,792 1,208
- -------------------------------------------------------------------------
Total shareholders' funds (155,966) (151,331)
- -------------------------------------------------------------------------
The company maintains its books and records in accordance with UK generally
accepted accounting principals (GAAP). The financial results set forth
above represent the Company's financial results under UK GAAP, translated
for convenience into US dollars at the rate of US$:(pound) 1.6638, being
the rate of exchange on December 31, 1998, the last trading day of the
year.
The Dialog Corporation plc
Consolidated Cash Flow Statement (Unaudited)
for the year ended December 31, 1998
1998 1997
$000 $000
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
NET CASH INFLOW FROM OPERATING ACTIVITIES 56,820 5,283
- -------------------------------------------------------------------------
RETURNS ON INVESTMENTS AND SERVICING
OF FINANCE Dividends paid to minority
shareholders in subsidiary
undertaking - (68)
Interest received 341 587
Interest paid on bank loans and overdrafts (25,374) (973)
Interest paid on finance leases (77) (198)
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
(25,110) (652)
- -------------------------------------------------------------------------
TAXATION PAID (581) (263)
- -------------------------------------------------------------------------
CAPITAL EXPENDITURE
Payments to develop intangible assets (22,411) (4,570)
Payments to acquire tangible fixed assets (9,176) (3,306)
Receipts from sale of tangible fixed assets 351 296
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
(31,236) (7,580)
- -------------------------------------------------------------------------
ACQUISITIONS AND DISPOSALS
Purchase of subsidiary undertakings (1,606) (436,953)
Cash impact of revisions to fair values (3,800) -
Payments to acquire minority interest in a
subsidiary undertaking (2,862) -
Net cash acquired with subsidiary undertakings (55) 19,811
Purchase of share in joint venture (1,807) (1,015)
Expenses in connection with purchase of
subsidiary undertaking (784) (6,417)
Proceeds of sale of investments 11,852 -
Payments made in connection with sale of
technology - (935)
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
938 (425,509)
- -------------------------------------------------------------------------
CASH INFLOW/(OUTFLOW) BEFORE THE USE OF
LIQUID RESOURCES AND FINANCING 831 (428,721)
- -------------------------------------------------------------------------
MANAGEMENT OF LIQUID RESOURCES
Cash withdrawn from deposit 1,032 -
Net receipts from sale of investments
with original maturity date of less than one year - 8,951
- -------------------------------------------------------------------------
FINANCING
Net proceeds on issue of Ordinary Share Capital 762 185,183
Net proceeds on issue of Senior Credit Facility - 87,909
Net proceeds on issue of Senior Subordinated
Notes - 171,112
Debt due within one year:
-Repayment of loans (15,891)
Expenses on issue of Ordinary Share Capital - (1,256)
Expenses on raising of Senior Credit Facility
and Senior Subordinated Note notes (48) (2,675)
Repayment of capital element of finance leases (913) (2,481)
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
(16,090) 437,792
- -------------------------------------------------------------------------
(DECREASE)/INCREASE IN CASH (14,227) 18,022
RECONCILIATION OF NET CASH FLOW TO
MOVEMENT IN NET (DEBT)/FUNDS
(Decrease)/increase in cash in the period (14,227) 18,022
Cash used to decrease lease financing 913 2,481
Cash acquired from issue of debt (net of
expenses) 48 (256,345)
Cash used to repay loans 15,891 -
Decrease in liquid resources and cash deposits
with original maturity dates of less than
one year (1,032) (8,951)
- -------------------------------------------------------------------------
Change in net (debt)/funds from cash flows 1,593 (244,793)
Other non-cash changes (1,574) (198)
New finance leases - (203)
Effect of foreign exchange rate changes 2,820 (7,357)
- -------------------------------------------------------------------------
Movement in net (debt) /funds in period 2,839 (252,551)
Net (debt)/funds at beginning of period (242,755) 9,796
- -------------------------------------------------------------------------
Net (debt)/funds at end of period (239,916) (242,755)
- -------------------------------------------------------------------------
The company maintains its books and records in accordance with UK generally
accepted accounting principles (GAAP). The financial results set forth
above represent the Company's financial results under UK GAAP, translated
for convenience in to US dollars at the rate of US$:(pound)
1.6638, being the rate of exchange on December 31, 1998, the last trading
day of the year.
General
The financial statements for the year ended 31 December 1997 have been
reported on by the Company's auditors, Price Waterhouse (now
PricewaterhouseCoopers), and delivered to the Registrar of Companies. The
audit report was not qualified an neither did it contain any statements
under Section 237 (2) or (3) of the Companies Act 1985. Statutory accounts
for the year ended 31 December 1998 will be delivered to the Registrar of
Companies following the Annual General Meeting.
CONTACT: The Dialog Corporation plc, London
Sara Parker, Corporate Communications
sara_parker@dialog.com
011-44-171-930-6900
or
The Dialog Corporation plc, New York
Kristian Talvitie, U.S. Investor Relations
kristian_talvitie@dialog.com
212/381-1824
or
Jaffoni & Collins Incorporated, New York
David C. Collins/Robert L. Rinderman
dialy@jcir.com
212/835-8500