I believe that improved market conditions and the sharp focus, which Erik and his team have brought on value creation and the operational execution should sustain a continued improvement in performance. Mark will now take you through the results, and Erik will then go through the businesses and outlook in more detail.

Mark Armour

Thank you, Chairman. Good morning. Well, the first half results reflect the financial progress of Reed Elsevier. We saw underlying revenue growth in each of our businesses, as the Chairman mentioned, excluding the net cycling out of biennial exhibitions, reflecting the improved market environment, new product introduction, expanded sales and marketing and the other actions taken to improve the business.

Underlying revenue growth was 1% or 3%, excluding the biennials, and the underlying operating profit growth was 2%. Taking to account net disposals and currency translation effects over weaker U.S. dollar, revenues were 3% lower, both in sterling and in euros. The adjusted operating margin was up 130 basis points at 26.6% and adjusted earnings per share were up 5%, both for Reed Elsevier PLC and Reed Elsevier NV, and also up 5% at constant currencies.

As the Chairman mentioned, our reported earnings per share, which include amortization of acquired intangibles, acquisition-related costs, gains and disposal losses and all deferred tax effects were up 20% for each of Reed Elsevier PLC and Reed Elsevier NV. Cash flow was good with 93% conversion of operating profit into cash in the last 12 months to 30 June, and our financial position is strong with net debt-to-EBITDA of 2.4x at 30 June on a pension and lease-adjusted basis.

I'm presenting the figures today in sterling. The same charts with the euro figures can be found in the appendices to the presentation. With the average euro sterling exchange rate unchanged between the first half and the comparative period, the growth rates for profit and loss items are, in fact, the same in both sterling and in euros. The first chart sets out the adjusted profit and loss figures with a 3% decline in revenues at the reported sterling exchange rates, a 2% increase in adjusted operating profit, adjusted pretax profit up 6%, adjusted net profit up 5%. I'll talk more about these items as we go through the presentation, and I'll mostly be focusing on growth at constant currencies.

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