AMVESCAP PLC Reports Results for Six Months Ended June 30, 2004.LONDON London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. -- AMVESCAP (NYSE NYSE See: New York Stock Exchange :AVZ)(LSE LSE - Language Sensitive Editor :AVZ)(TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :AVZ) reported that profit before tax, goodwill amortization and exceptional items for the six months ended June June: see month. 30, 2004 amounted to GBP GBP In currencies, this is the abbreviation for the British Pound. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 139.5 million ($252.5 million) compared to GBP 110.9 million ($183.0 million) for the six months of 2003. Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of before goodwill amortization and exceptional items amounted to 11.2p (2003: 9.6p). Revenues totaled GBP 577.1 million ($1,044.6 million) in the first half of 2004 compared to GBP 552.6 million ($911.8 million) in 2003.
Results for Six Months Ended June
30,
2004 2003 2004++ 2003++
------- ------- ---------- --------
Revenues GBP GBP
577.1m 552.6m $1,044.6m $911.8m
Profit before tax, goodwill
amortization GBP GBP
and exceptional items 139.5m 110.9m $252.5m $183.0m
Earnings per share before goodwill
amortization and exceptional
items:
--basic 11.3p 9.6p $0.41+ $0.32+
--diluted 11.2p 9.6p $0.41+ $0.32+
Earnings per share before goodwill
amortization:
--basic 11.3p 4.6p $0.41+ $0.15+
--diluted 11.2p 4.6p $0.41+ $0.15+
----------------------------------------------------------------------
+ Per American Depositary Share American Depositary Share (ADS) Foreign stock issued in the US and registered in the ADR system. , equivalent to 2 ordinary shares. ++ For the convenience of the reader, pounds sterling for the period ended June 30, 2004 have been translated to U.S. dollars using $1.81 per GBP 1.00 (2003: $1.65 per GBP 1.00). "AMVESCAP achieved a solid rise in earnings during the first half of 2004 that was partially obscured by the impact of foreign exchange rates," said Mr. Charles Charles, archduke of Austria Charles, 1771–1847, archduke of Austria; brother of Holy Roman Emperor Francis II. Despite his epilepsy, he was the ablest Austrian commander in the French Revolutionary and Napoleonic wars; however, he was handicapped by W. Brady Bra·dy , James Buchanan Known as "Diamond Jim." 1856-1917. American financier and philanthropist who gained his nickname because of his attraction to diamonds and his extravagant lifestyle. Noun 1. , Executive Chairman. "Our businesses in the U.K., Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , and Asia experienced
good growth. In the U.S., however, uncertainty surrounding sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. issues has hindered our full participation in that marketplace, despite the steadily improving performance of our products." "AMVESCAP's efforts to reach a settlement with U.S. regulators continue to progress, and we hope to resolve these matters in the near future," added Mr. Brady. "AMVESCAP's Board of Directors has decided to defer de·fer 1 v. de·ferred, de·fer·ring, de·fers v.tr. 1. To put off; postpone. 2. To postpone the induction of (one eligible for the military draft). v.intr. a decision on the interim dividend until after a regulatory settlement has been concluded." Financial Summary Profit before tax, goodwill amortization and exceptional items for the three months ended June 30, 2004, amounted to GBP 67.6 million ($122.4 million) compared to GBP 62.4 million ($103.0 million) in the 2003 second quarter. Diluted earnings per share before goodwill amortization and exceptional items amounted to 5.4p (2003: 5.4p) for the three months ended June 30, 2004. Revenues for the three months ended June 30, 2004 amounted to GBP 288.8 million ($522.7 million) compared to GBP 281.8 million ($465.0 million) from the prior year's quarter. Funds under management totaled $371.8 billion (GBP 205.4 billion) at June 30, 2004, compared to $370.6 billion at December December: see month. 31, 2003. Approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 55% of the total funds under management were invested in equity securities and 45% were invested in fixed income and other securities at June 30, 2004 (March 31, 2004: 55% Equity and 45% Fixed Income). Equity securities were invested in the following disciplines at June 30, 2004: 32% in growth, 41% in core and 27% in value styles (March 31, 2004: 32% in growth, 42% in core, and 26% in value styles). Institutional money market funds, included above, amounted to $42.3 billion at June 30, 2004 compared to $50.9 billion at December 31, 2003. Average funds under management for the six months ended June 30, 2004 were $374.4 billion, compared to $329.9 billion for the first half of 2003. Of these funds, average institutional money market fund levels totaled $47.0 billion for the first half of 2004 compared to $52.6 billion of the first half 2003. Average funds under management during the second quarter were $372.6 billion compared to $376.3 billion for the preceding quarter and $335.8 billion for the second quarter of 2003. Earnings before interest, taxes, depreciation, amortization and exceptional items (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become ) reached GBP 190.1 million ($344.1 million) and GBP 92.7 million ($167.8 million) for the six months and second quarter ended June 30, 2004. Net debt at June 30, 2004 amounted to GBP 524.3 million compared to GBP 576.6 million at December 31, 2003. Business Highlights The AIM U.S. group reported operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of GBP 78.4 million. Funds under management amounted to $138.5 billion at June 30, 2004, including $42.3 billion relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc institutional money market funds. During the quarter, AIM U.S. launched AIM Allocation The apportionment or designation of an item for a specific purpose or to a particular place. In the law of trusts, the allocation of cash dividends earned by a stock that makes up the principal of a trust for a beneficiary usually means that the dividends will be treated as Solutions, a group of three multi-fund portfolios that offer a simplified sim·pli·fy tr.v. sim·pli·fied, sim·pli·fy·ing, sim·pli·fies To make simple or simpler, as: a. To reduce in complexity or extent. b. To reduce to fundamental parts. c. approach to achieving asset allocation Asset Allocation The process of dividing a portfolio among major asset categories such as bonds, stocks or cash. The purpose of asset allocation is to reduce risk by diversifying the portfolio. and diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. . This new series of investment solutions has been well-received by financial advisors. The AIM Canada group reported operating profit of GBP 46.4 million. The Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. retail business increased net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight to $588 million in the six months ended June 30, 2004 compared to $64.1 million in the six months ended June 30, 2003. Funds under management amounted to $30.8 billion at June 30, 2004. The INVESCO INVESCO, (NYSE: IVZ) is an investment management company based in London, England, UK. It is quoted on the London Stock Exchange and is a member of the FTSE 100 Index. It has branches in 19 countries, but more than half of its business is in the United States. U.S. group reported revenues of GBP 102.1 million and operating profits of GBP 29.6 million in the first half of 2004. The operating profit margin Operating profit margin The ratio of operating profit to net sales. for this business was 28.9% for the 2004 period, compared to 23.4% for the prior year. Sales of alternative asset classes were strong through the first six months of the year, including the funding of three new financial structures for a total of approximately $1.2 billion in assets. Funds under management amounted to $120.2 billion at June 30, 2004. INVESCO U.K.'s revenues amounted to GBP 93.8 million for the first half of 2004, an increase of GBP 11.3 million from the prior year. Operating profits totaled GBP 11.6 million for the first half of 2004, compared with GBP 8.1 million from the prior year. Investment performance of U.K. managed funds remains strong with over 75% of assets outperforming their peer group over both 1 and 3 years. This business generated $500 million in net sales during the period. Funds under management were $43.1 billion at June 30, 2004, an increase of $4.1 billion from the end of 2003. INVESCO Europe/Asia's revenues amounted to GBP 38.5 million for the first half of 2004, compared to GBP 35.7 million in the prior year. Operating profits have increased by GBP 2.4 million for the first half of 2004. During this quarter, our China joint venture successfully launched a second China fund raising over $300 million. Funds under management were $24.5 billion at June 30, 2004, an increase of $700 million during the year. Private Wealth Management and AMVESCAP Retirement's revenues amounted to GBP 44.6 million during the six months ended June 30, 2004. In March, Atlantic Trust, AMVESCAP's private wealth management group, completed its acquisition of Stein Stein , William Howard 1911-1980. American biochemist. He shared a 1972 Nobel Prize for pioneering studies of ribonuclease. Roe Investment Counsel LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control adding approximately $7 billion in assets under management Assets Under Management (AUM) is a term used by financial services companies in the mutual fund and money management or investment management business to gauge how much money they are managing. . AMVESCAP Retirement had $27.7 billion in assets under administration at June 30, 2004. This group services 1,200 plans with 624,000 plan participants Plan participants Employees or other beneficiaries who are eligible to receive benefits from a company's employee benefit plan. at June 30, 2004. AMVESCAP is a leading independent global investment manager, dedicated to helping people worldwide build their financial security. Operating under the AIM, INVESCO, and Atlantic Trust brands, AMVESCAP strives to deliver outstanding investment performance and service through a comprehensive array of retail and institutional products for clients around the world. The Company is listed on the London, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , Paris, and Toronto stock exchanges Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. with the symbol "AVZ." Additional information is available at www.amvescap.com. Members of the investment community and general public are invited to listen to the conference call today, Thursday Thursday: see week. , July July: see month. 29, 2004, at 2:30 p.m. BST (convention) BST - British Summer Time. The name for daylight-saving time in the UK GMT time zone. (9:30 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT ), by dialing one of the following numbers: 610-769-9391 or 1-888-201-4990 for U.S. callers. An audio replay of the conference call will be available until Thursday, August 5, 2004, at 10:00 p.m. BST by calling 402-220-0320 or 1-800-695-3946 for U.S. callers. The presentation slides that will be reviewed during the conference call are expected to be available on the morning of July 29, 2004, on AMVESCAP's Web site at www.amvescap.com. This release may include statements that constitute "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " under the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. securities laws. Forward-looking statements include information concerning possible or assumed future results of our operations, earnings, liquidity, cash flow and capital expenditures, industry or market conditions, assets under management, acquisition activities and the effect of completed acquisitions, debt levels and the ability to obtain additional financing or make payments on our debt, regulatory developments, demand for and pricing of our products and other aspects of our business or general economic conditions. In addition, when used in this report, words such as "believes," "expects," "anticipates," "intends," "plans," "estimates," "projects," and future or conditional Subject to change; dependent upon or granted based on the occurrence of a future, uncertain event. A conditional payment is the payment of a debt or obligation contingent upon the performance of a certain specified act. verbs such as "will," "may," "could," "should," and "would," or any other statement that necessarily depends on future events, are intended to identify forward-looking statements. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. Although we make such statements based on assumptions that we believe to be reasonable, there can be no assurance that actual results will not differ materially from our expectations. We caution investors not to rely unduly on any forward-looking statements. In connection with any forward-looking statements, you should carefully consider the areas of risk described in our most recent Annual Report on Form 20-F, as filed with the United States Securities and Exchange Commission ("SEC"). You may obtain these reports from the SEC's Web site at www.sec.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. . AMVESCAP PLC Group Profit and Loss Account (in thousands)
Six Months Ended June 30,
---------------------------
2004 2003
------------ -------------
Revenues GBP 577,088 GBP 552,594
Expenses:
Operating (425,159) (418,723)
Exceptional -- (62,094)
Goodwill amortization (76,025) (74,838)
------------ -------------
Operating profit 75,904 (3,061)
Investment income 7,558 3,499
Interest expense (20,016) (26,435)
------------ -------------
Profit before taxation 63,446 (25,997)
Taxation (48,858) (11,592)
------------ -------------
Profit after taxation 14,588 (37,589)
Dividends -- (40,835)
------------ -------------
Retained profit for the period GBP 14,588 GBP (78,424)
============ =============
Earnings per share before
goodwill amortization and
exceptional items:
---basic 11.3p 9.6p
---diluted 11.2p 9.6p
------------ -------------
Earnings per share:
---basic 1.8p -4.7p
---diluted 1.8p -4.7p
------------ -------------
Average shares outstanding:
---basic 803,384 803,844
---diluted 812,513 805,953
------------ -------------
AMVESCAP PLC Group Profit and Loss Account (in thousands)
Three Months Ended June 30,
------------------------------
2004 2003
-------------- -------------
Revenues GBP 288,818 GBP 281,796
Expenses:
Operating (212,213) (207,142)
Exceptional -- (62,094)
Goodwill amortization (38,442) (37,492)
-------------- -------------
Operating profit 38,163 (24,932)
Investment income 1,239 2,011
Interest expense (10,227) (14,225)
-------------- -------------
Profit before taxation 29,175 (37,146)
Taxation (23,680) 3,247
------------------------------
Profit after taxation 5,495 (33,899)
Dividends -- (40,835)
-------------- -------------
Retained profit for the period GBP 5,495 GBP (74,734)
============== =============
Earnings per share before
goodwill amortization and
exceptional items:
---basic 5.5p 5.4p
---diluted 5.4p 5.4p
-------------- -------------
Earnings per share:
---basic 0.7p -4.2p
---diluted 0.7p -4.2p
-------------- -------------
Average shares outstanding:
---basic 804,415 803,120
---diluted 812,039 805,865
-------------- -------------
AMVESCAP PLC Group Balance Sheet (in thousands)
June 30, Dec 31,
2004 2003
----------- -----------
Fixed assets
Goodwill GBP 2,385,131 GBP 2,411,803
Investments 87,105 89,639
Tangible assets 159,161 170,598
----------- -----------
2,631,397 2,672,040
Current assets
Debtors 923,395 880,467
Investments 68,695 74,652
Cash 251,633 318,713
----------- -----------
1,243,723 1,273,832
Current liabilities
Current maturities of long-term debt (219,575) --
Creditors (1,035,799) (1,089,759)
----------- -----------
(1,255,374) (1,089,759)
Net current assets (11,651) 184,073
----------- -----------
Total assets less current liabilities 2,619,746 2,856,113
Long-term debt (471,146) (730,041)
Provisions for liabilities and charges (69,375) (77,601)
----------- -----------
Net assets GBP 2,079,225 GBP 2,048,471
=========== ===========
Capital and reserves
Called up share capital GBP 202,607 GBP 200,264
Share premium account 700,257 675,755
Shares held by employee trusts (201,362) (185,809)
Exchangeable shares 309,106 330,629
Profit and loss account 515,005 500,417
Other reserves 553,612 527,215
----------- -----------
Shareholders' funds, equity interests GBP 2,079,225 GBP 2,048,471
=========== ===========
AMVESCAP PLC Group Cash Flow Statement (in thousands)
Six Months Ended
June 30,
-------------------
2004 2003
--------- ---------
Operating profit GBP 75,904 GBP (3,061)
Goodwill amortization and depreciation 98,582 101,275
Change in debtors, creditors and other (79,521) 47,340
--------- ---------
Net cash inflow from operating activities 94,965 145,554
--------- ---------
Interest paid, net of investment income (17,290) (21,277)
Taxation (33,309) (60,949)
Capital expenditures, net of sales (9,677) (15,986)
Net (purchase)/disposal of fixed asset investments (1,385) 5,654
Acquisitions and disposals (28,195) (10,635)
Dividends paid (53,312) (52,978)
Net repayment of debt (9,913) (31,756)
Change in bank overdraft (117) (5,196)
Foreign exchange on cash at bank and in hand (8,847) (490)
--------- ---------
Decrease in cash at bank and in hand GBP(67,080)GBP(48,059)
========= =========
AMVESCAP PLC Segmental segmental /seg·men·tal/ (seg-men´t'l) 1. pertaining to or forming a segment or a product of division, especially into serially arranged or nearly equal parts. 2. undergoing segmentation. Information (in thousands)
Six Months Ended June 30,
2004
Oper.
Revenues Expenses Profit(a)
-------- ---------- ---------
AIM
GBP GBP GBP
U.S. 213,409 (135,024) 78,385
Canada 84,699 (38,262) 46,437
-------- ---------- ---------
298,108 (173,286) 124,822
-------- ---------- ---------
INVESCO
U.S. 102,133 (72,566) 29,567
U.K. 93,778 (82,169) 11,609
Europe/Asia 38,518 (37,889) 629
-------- ---------- ---------
234,429 (192,624) 41,805
-------- ---------- ---------
Private Wealth/Retirement 44,551 (43,299) 1,252
Corporate -- (15,950) (15,950)
-------- ---------- ---------
GBP GBP GBP
577,088 (425,159) 151,929
======== ========== =========
Six Months Ended June 30,
2003
Oper.
Revenues Expenses Profit(a)
-------- ---------- ---------
AIM
GBP GBP GBP
U.S. 239,708 (150,944) 88,764
Canada 69,909 (37,221) 32,688
-------- ---------- ---------
309,617 (188,165) 121,452
-------- ---------- ---------
INVESCO
U.S. 83,703 (64,149) 19,554
U.K. 82,515 (74,368) 8,147
Europe/Asia 35,734 (37,551) (1,817)
-------- ---------- ---------
201,952 (176,068) 25,884
-------- ---------- ---------
Private Wealth/Retirement 41,025 (41,867) (842)
Corporate - (12,623) (12,623)
-------- ---------- ---------
GBP GBP GBP
552,594 (418,723) 133,871
======== ========== =========
(a) before goodwill amortization and exceptional items Notes 1. The taxation charge is estimated based on the total expected tax charge for the year. A significant proportion of the charge is expected to arise from U.S. operations. 2. Basic earnings per share is based on the weighted average number of ordinary and exchangeable shares outstanding during the respective periods. Diluted earnings per share takes into account the effect of dilutive potential ordinary and exchangeable shares outstanding during the six month period.
2004
-------------------------
Profit Number
after of Per
taxation shares share
GBP '000 '000 amount
--------- -------- ------
Basic earnings per share 14,588 803,384 1.8p
Dilutive effect of options -- 9,129
--------- -------- ------
Diluted earnings per share 14,588 812,513 1.8p
========= ======== ======
2003
-------------------------
Profit Number
after of Per
taxation shares share
GBP '000 '000 amount
--------- -------- ------
Basic and diluted earnings per share (37,589) 803,844 -4.7p
======
Profit before goodwill amortization and exceptional items is a more appropriate basis for the calculation of earnings per share since this represents a more consistent measure of the year-by-year performance of the business; therefore, the calculation below is presented on that basis.
2004
-----------------------------
Profit before
goodwill
amortization
and
exceptional Number
items of Per
shares share
GBP '000 '000 amount
------------- -------- ------
Basic earnings per share 90,613 803,384 11.3p
Dilutive effect of options -- 9,129
------------- -------- ------
Diluted earnings per share 90,613 812,513 11.2p
============= ======== ======
2003
-----------------------------
Profit before
goodwill
amortization
and
exceptional Number
items of Per
shares share
GBP '000 '000 amount
------------- -------- ------
Basic earnings per share 76,989 803,844 9.6p
Dilutive effect of options -- 2,109
------------- -------- ------
Diluted earnings per share 76,989 805,953 9.6p
============= ======== ======
3. The 2003 consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: profit and loss includes exceptional charges as follows:
GBP '000 2003
------------------------------------------------
Redundancy 31,054
U.S. Retail reorganization 12,183
Lease costs 9,620
Acquisitions 2,326
Project costs & other 6,911
------------
Total exceptional items 62,094
------------
Total exceptional items net of tax 39,740
============
Diluted per share impact 4.9p
4. On March 1, 2004 we completed the acquisition of Stein Roe Investment Counsel LLC for consideration totaling GBP 87.3 million which includes earn-out Earn-out Refers to an additional payment in a merger or acquisition that is not part of the original acquisition cost, which is based on the acquired company's future earnings relative to a level determined by the merger agreement. provisions of GBP 23.0 million. Goodwill and management contract intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. of GBP 84.3 million have been recorded on this acquisition, net cash paid was GBP 36.2 million and shares were issued to the value of GBP 25.3 million. On March 31, 2004 we completed the disposal of the U.K. and Jersey businesses of Atlantic Wealth Management. A gain of GBP 4.7 million has been recorded within investment income. 5. The Company adopted Urgent Issues Task Force Abstract 38, "Accounting for ESOP ESOP See: Employee Stock Ownership Plan ESOP See Employee Stock Ownership Plan (ESOP). trusts" as of June 30, 2004, which requires that the Company's shares owned by employee share ownership trusts be recorded as deductions from equity rather than assets on the balance sheet. Certain prior year amounts have been reclassified to conform to Verb 1. conform to - satisfy a condition or restriction; "Does this paper meet the requirements for the degree?" fit, meet coordinate - be co-ordinated; "These activities coordinate well" current year presentation. Independent Review Report to AMVESCAP PLC Introduction We have been instructed by AMVESCAP PLC (the "Group") to review the financial information for the three and six months ended June 30, 2004 which comprises the Group Profit and Loss Account, Group Balance Sheet, Group Cash Flow Statement, Segmental Information and the related notes 1 to 5. We have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the financial information. This report is made solely to the company in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with guidance contained in Bulletin 1999/4 'Review of interim financial information' issued by the Auditing Practices Board. To the fullest extent permitted by the law, we do not accept or assume responsibility to anyone other than the company, for our work, for this report, or for the conclusions we have formed. Directors' responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by the directors. The directors are responsible for preparing the interim report in accordance with the Listing Rules of the Financial Services Authority The Financial Services Authority ("FSA") is an independent non-departmental public body and quasi-judicial body that regulates the financial services industry in the United Kingdom. Its main office is based in Canary Wharf, London, with another office in Edinburgh. which require that the accounting policies and presentation applied to the interim figures should be consistent with those applied in preparing the preceding annual financial statements except where any changes, and the reasons for them, are disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). . Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4 'Review of interim financial information' issued by the Auditing Practices Board for use in the United Kingdom. A review consists principally of making enquiries of group management and applying analytical procedures Analytical Procedures is one of financial audit skill which help an auditor understand the client's business and changes in the business, to identify potential risk areas and to plan other audit procedures. to the financial information and underlying financial data, and based thereon there·on adv. 1. On or upon this, that, or it. 2. Archaic Following that immediately; thereupon. Adv. 1. thereon - on that; "text and commentary thereon" on it, on that , assessing whether the accounting policies and presentation have been consistently applied, unless otherwise disclosed. A review excludes audit procedures such as tests of controls and verification See verify. verification - The process of determining whether or not the products of a given phase in the life-cycle fulfil a set of established requirements. of assets, liabilities and transactions. It is substantially less in scope than an audit performed in accordance with United Kingdom Auditing Standards and therefore provides a lower level of assurance than an audit. Accordingly we do not express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the three and six months ended June 30, 2004. Ernst & Young LLP LLP - Lower Layer Protocol London July 28, 2004 AMVESCAP PLC Funds Under Management (in billions)
AIM
--------------
Total U.S. Canada
------- ------- ------
Dec 31, 2003 $370.6 $149.4 $28.7
Market gains 9.3 2.2 1.6
Net new /(lost) business (6.9) (5.3) 0.6
Change in money
market funds (7.8) (7.8) --
Acquisitions/(disposals) 6.1 -- --
Transfers -- -- --
Foreign currency 0.5 -- (0.1)
------- ------- ------
June 30, 2004 $371.8 $138.5 $30.8
======= ======= ======
June 30, 2004 + GBP 205.4 GBP 76.5 GBP 17.0
======= ======= ======
INVESCO
-----------------------------
U.S. U.K. Europe/Asia PWM
------- -------- ------------ ----------
Dec 31, 2003 $120.2 $39.0 $23.8 $9.5
Market gains 2.6 2.1 0.8 --
Net new /(lost) business (2.6) 0.5 0.3 (0.4)
Change in money
market funds -- -- -- --
Acquisitions/(disposals) -- -- -- 6.1
Transfers -- 0.5 -- (0.5)
Foreign currency -- 1.0 (0.4) --
------- -------- ------------ ----------
June 30, 2004 $120.2 $43.1 $24.5 $14.7
======= ======== ============ ==========
June 30, 2004 + GBP 66.4 GBP 23.8 GBP 13.6 GBP 8.1
======= ======== ============ ==========
+ Translated at $1.81 per GBP 1.00. Note: AMVESCAP Retirement has $27.7 billion in assets under administration as of June 30, 2004 and December 31, 2003.
AIM
---------------
Total U.S. Canada
-------- ------- -------
March 31, 2004 $381.4 $147.6 $30.5
Market gains 2.0 0.3 0.5
Net new /(lost)
business (5.4) (3.5) 0.1
Change in money
market funds (5.8) (5.9) --
Foreign currency (0.4) -- (0.3)
-------- ------- -------
June 30, 2004 $371.8 $138.5 $30.8
======== ======= =======
June 30, 2004 + GBP205.4 GBP76.5 GBP17.0
======== ======= =======
INVESCO
-----------------------------
U.S. U.K. Europe/Asia PWM
------- -------- ------------ ----------
March 31, 2004 $121.3 $41.9 $25.3 $14.8
Market gains 0.5 0.8 (0.1) --
Net new /(lost)
business (1.6) 0.2 (0.5) (0.1)
Change in money
market funds -- -- 0.1 --
Foreign currency -- 0.2 (0.3) --
------- -------- ------------ ----------
June 30, 2004 $120.2 $43.1 $24.5 $14.7
======= ======== ============ ==========
June 30, 2004 + GBP 66.4 GBP 23.8 GBP 13.6 GBP 8.1
======= ======== ============ ==========
+ Translated at $1.81 per GBP 1.00. Note: AMVESCAP Retirement has $27.7 billion in assets under administration as of June 30, 2004, compared to $28.3 billion as of March 31, 2004. AMVESCAP PLC Reconciliation to U.S. Accounting Principles (in thousands)
Six Months Ended June
30,
---------------------
2004 2003
------ ------
Net profit under U.K. GAAP GBP 14,588 GBP (37,589)
U.S. GAAP Adjustments:
Acquisition accounting 70,626 69,445
Redundancy and reorganizations (22,375) 39,112
Taxation 8,011 (12,375)
Other (220) (717)
---------- ----------
Net income under U.S. GAAP GBP 70,630 GBP 57,876
========== ==========
Earnings per share:
--basic 8.8p 7.2p
--diluted 8.7p 7.2p
---------- ----------
June 30, Dec 31,
2004 2003
---------- ----------
Shareholders' funds under U.K. GAAP
GBP 2,079,225 GBP 2,048,471
U.S. GAAP Adjustments:
Fixed assets:
Goodwill 1,120,602 1,071,520
Debtors 136,056 164,325
Investments 2,793 2,901
Current liabilities 26,387 104,750
Long-term debt - non-recourse (136,056) (164,325)
Provisions for liabilities and charges (3,727) (9,282)
---------- ----------
Shareholders' equity under U.S. GAAP GBP 3,225,280 GBP 3,218,360
========== ==========
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