Final Results

ToLuna Plc (the "Group" or the "Company") Results for the year ended 31 December 2007 A year of continued growth in revenue, profit and innovation Highlights * Strong organic growth with revenues ahead 49 per cent. to £12.5million (2006: £8.4 million) * Pre-tax profits ahead in excess of 42 per cent. to £3.2 million (2006: £2.2 million) * Pre-tax profits before share based payment charges and charity share-based donation ahead 48 per cent. to £3.4 million * EPS up 64 per cent. to 6.59 pence (2006: 4.03 pence), more than 10 per cent. above market expectations * Final dividend proposed of 0.75 pence per share, making 1.12 pence for the year (2006: 0.75 pence) * Operating cash flow improved to £3.6 million and cash reserves at the end of the year had grown to £4.2 million * Continued investment in people with average headcount increasing from 68 in 2006 to a average headcount of 120 in 2007 * Panel members up from 1.3 million to 1.8 million * Successful launch of our new PanelPortal software as a service solution * Creation of first web 2.0 panel community, with the acquisition of dPolls and the launch of toluna.com in the UK Further enquires: ToLuna plc Frederic-Charles Petit, Chief Executive Tel: 00 33 6 3308 0391 Richard Bernstein, Non-Executive Director Tel: 0207 491 0770 John East & Partners Limited David Worlidge/Simon Clements Tel: 0207 628 2200 Powerscourt Matthew Fletcher Paul Durman Tel: 0207 250 1446 Notes to Editors Toluna is a leading independent provider of online panels and technology services to the market research industry. Through its offices in Paris, London, Frankfurt, Amsterdam, New York and Seattle, it offers customers access to 1.8 million online panellists in 27 countries. It also licenses its survey and panel management technology. Chairman's Statement At a time of unprecedented challenges in global financial markets, I am pleased to report that 2007 was another year of impressive progress for ToLuna. Our strategy of becoming the leading independent provider of panel, community and technology services to the market research industry remains unchanged. A year of rapid growth has brought us significantly further along our chosen path. Our panel network now extends to 27 countries and our panel membership grew from 1.3 million to 1.8 million during the year. The acquisition of dPolls in March 2007, together with the creation of our Research & Development centre in Haïfa, brought us additional strengths in technology and innovation that will help us greatly in developing new products and reinforce the community focus of our panel. In this regard, with the launch of our new UK community initiative at toluna.com in October, where members can post their own opinions and polls, we have created the first web 2.0 panel community. At a time where the focus of our industry is into data quality and engagement with respondents, this is a major step forward both for the Group and our industry. The response was instant and this initiative has been a great success in terms of engaging with our online panel community. In the UK, toluna.com currently receives 340,000 unique visitors per month and an average of 110,000 votes per day. Since October 2007, our members have posted 23,000 polls and provided 375,000 opinions, and we are attracting people who might otherwise not take the time to participate in surveys. We intend to extend this very shortly to other territories and believe it has significant potential to strengthen our panels, improve response rates, enhance profiling and the quality of data collected. Results I am pleased to report that our team delivered a substantial advance in sales and profits in 2007, while a close focus on cash generation and operating margins enabled us to report earnings per share comfortably in excess of our expectations. Revenue for the year grew 49 per cent. from £8.4 million to £12.5 million. Though the rate of growth slowed in the second half of the year, this followed a decision to focus on higher margin business. Profit before tax rose 42 per cent. to £3.2 million, (£2.2 million in 2006). Earnings per share advanced 64 per cent. to 6.59 pence (2006: 4.03 pence). Profit after tax has increased 64 per cent. to £2.4 million (2006: £1.4 million). The strength of cash generation is a feature of our business. Operating cash flow improved to £3.6 million and cash reserves at the end of the year had grown to £4.2 million. This gives us scope for further acquisitions to improve our reach geographically and technologically and also gives us the opportunity to invest in our panels and R&D. Dividend Your board is recommending a final dividend of 0.75 pence per share payable on 20 June 2008 to those shareholders on the register at noon on 18 April 2008. This brings the total dividend for the year to 1.12 pence (2006: 0.75 pence). Review of operations Offices One of our priorities in 2007 was to reinforce our foothold in our core market further. We continued investing in our London, Paris and Frankfurt offices by adding more local resources servicing our clients and focusing on the quality of our delivery. We have also opened an Amsterdam office. We have expanded our coverage in the USA with the opening of our Seattle office. We have therefore strengthened our geographic hubs in Europe and in North America and feel confident that this gives us a strong foundation on which to build further growth. Software as a service solution We continue to invest in cutting edge technology services with new versions of our AutomateSurvey and PanelPortal services launched during the year. The new release of PanelPortal in particular, which allows our clients to create, manage and engage with their own panel of customers, readers and employees has been very warmly received. From the outset we were confident that building our panel, survey and poll technology offering would enable us to help blue chip companies to engage with their customers online in a "self service" data collection and insight environment. The latest industry forecasts indicate that this is by far one of the fastest growing sectors of online market research services. This reinforces our confidence that this represents a foundation for substantial growth as well as a key differentiator from our competitors. Panel building We have made great strides in extending the reach of our panel operations both in our main operating countries and in some of the world's fastest growing regions. Our panel membership, which was 350,000 when ToLuna shares were floated in 2005, had reached 1.8 million at the year end and is still growing rapidly. We operate in 27 countries as far afield as Mexico, Brazil, Russia, China and Japan. We intend to continue growing the reach of our panel. We have also made significant progress in our B2B panel strategy by signing an exclusive strategic partnership on 31 October 2007 with the leading B2B publisher Incisive Media to build B2B panels communities. I would like to take this opportunity to thank our panel members for participating actively in the life of our communities. Clients The number of clients, who include leading market research companies, media agencies, and blue chip companies, grew from 246 to 319 and repeat business again contributed a major part of our revenue at 70 per cent. Management and staff Our staff's expertise, dedication and commitment are the foundation of our business. This major asset for the company has enabled us to report another year of excellent service to our clients and I am proud to report that very high levels of satisfaction are confirmed by our monthly customer survey. On behalf of the board, I would like to thank all our staff for their efforts during another year of substantial achievement for the group. Charitable donations During 2007 we issued 25,000 new shares, which were gifted to five charitable organisations. We hope that this will encourage other companies to support charities in this way. Prospects The outlook for the world economy is clouded by the current turbulence on financial markets and the repercussions of the gathering slowdown in the US. Against this background, it is encouraging that our new financial year has begun well and is in line with our expectations. Although the market research industry is unlikely to be immune to a downturn, the Inside Research forecast suggests that the online services sector is well positioned for further growth. While your board remains aware of the risks, we believe the growth prospects of the online market research services sector, underpinned by its evident cost and technological advantages, remain robust. The sector is forecast to grow by 15 per cent. in the USA in the coming year and by 26 per cent. in Europe. Within the online sector, the provision of new types of research using the internet, such as specialist "self service" research to companies and the creation of private panels for clients is expected to grow rapidly. This is an area in which ToLuna is exceptionally well placed. Our cash resources also give us the scope to build on our successful track record in acquisitions. For all these reasons, while mindful of the risks, we look forward to the current year with confidence. George Kynoch Chairman 4 April 2007 Consolidated Income Statement Note Year ended Year ended 31 December 31 December 2007 2006 £'000 £'000 Revenue 2 12,462 8,392 Staff costs (4,817) (3,295) Other operating expenses (4,611) (2,963) Profit from operations 3,034 2,134 Net finance income 152 104 Profit before tax 3,186 2,238 Tax 3 (816) (790) Profit for the financial year 2,370 1,448 Earnings per share Basic 5 6.59p 4.03p Diluted 5 6.14p 3.96p Consolidated Balance Sheet 31 December 31 December 2007 2006 £'000 £'000 Non-current assets Goodwill 1,953 1,953 Other intangible assets 2,695 1,153 Property, plant and equipment 436 202 Deferred tax - 21 5,084 3,329 Current assets Trade and other receivables 4,161 3,019 Cash and cash equivalents 4,219 3,605 8,380 6,624 Total assets 13,464 9,953 Equity and liabilities Equity Share capital 360 359 Share premium account 5,437 5,365 Retained earnings 4,088 1,803 Translation reserve 132 (42) Total equity 10,017 7,485 Current liabilities Trade and other payables 3,047 1,933 Tax liabilities 91 535 Total current liabilities 3,138 2,468 Deferred tax 309 - Total equity and liabilities 13,464 9,953 Consolidated Cash Flow Statement Year ended Year ended 31 December 31 December 2007 2006 £'000 £'000 Operating activities Profit before tax 3,186 2,238 Adjustments for: Depreciation and amortisation 1,050 508 Share option grant costs 228 106 Other share based payments (charity) 55 - Loss on disposal of property, plant and 5 4 equipment Exchange differences 92 (42) 4,616 2,814 Tax paid (930) (73) Increase in receivables (1,142) (1,696) Increase in payables 1,021 860 Cash generated from operations 3,565 1,905 Net investment income (152) (104) Net cash from operating activities 3,413 1,801 Investing activities Interest received 155 106 Interest paid (3) (2) Purchase of subsidiary undertakings (net of (29) - cash acquired) Purchase of intangible assets (2,448) (1,010) Purchase of property, plant and equipment (376) (206) Net cash from investing activities (2,701) (1,112) Cash inflow before financing 712 689 Financing Dividends paid (313) (90) Issue of shares 18 - Proceeds from finance leases entered into 170 70 Capital repayments of finance leases (55) (32) Net cash (outflow) from financing (180) (52) Foreign exchange differences 82 - Increase in cash and cash equivalents in the 614 637 year Cash and cash equivalents at start of the year 3,605 2,968 Cash and cash equivalents at end of the year 4,219 3,605 Statements of Changes in Equity Consolidated Share Share Retained Translation Total capital premium earnings reserve account £'000 £'000 £'000 £'000 £'000 At 1 January 2006 359 5,365 339 - 6,063 Foreign exchange - - - (42) (42) differences Profit for the year - - 1,448 - 1,448 Total recognised - - 1,448 (42) 1,406 income and expense Dividends paid - - (90) - (90) Share option grants - - 106 - 106 At 31 December 2006 359 5,365 1,803 (42) 7,485 Foreign exchange - - - 174 174 differences Profit for the year - - 2,370 - 2,370 Total recognised - - 2,370 174 2,544 income and expense Dividends paid - - (313) - (313) Shares issued 1 72 - - 73 Share option grants - - 228 - 228 At 31 December 2007 360 5,437 4,088 132 10,017 Notes to the Financial Statements 1. Publication of non-statutory accounts The financial information set out in this announcement does not constitute statutory accounts as defined in Section 240 of the Companies Act 1985. The financial information for the year ended 31 December 2006 has been extracted from the group's financial statements to that date which received an unmodified auditors' report and have been delivered to the Registrar of Companies. The financial information for the year ended 31 December 2007 has been extracted from the group's financial statements to that date which have received an unmodified auditor's report but have not yet been delivered to the Registrar of Companies. 2. Segmental information All revenue relates to the supply of online data collection services to the market research industry. The directors regard this as a single class of business. All revenue is originated from Europe. Geographical split of revenue by customer location is as follows: Year to 31 December 2007 Europe Asia/Pacific America Total £'000 £'000 £'000 £'000 Revenue from external customers 9,632 253 2,577 12,462 Assets 13,402 61 1 13,464 Liabilities 2,727 48 363 3,138 Property plant and equipment 396 26 14 436 Capital expenditure 2,782 32 10 2,824 Amortisation and depreciation 1,039 6 5 1,050 Year to December 2006 Europe Asia/Pacific America Total £'000 £'000 £'000 £'000 Revenue from external customers 5,871 188 2,333 8,392 Assets 9,870 - 62 9,932 Liabilities 2,393 - 75 2,468 Property plant and equipment 192 - 10 202 Capital expenditure 1,204 - 12 1,216 Amortisation and depreciation 529 - - 529 3 Tax Year ended Year ended 31 December 31 December 2007 2006 £'000 £'000 Current tax UK tax 435 417 Foreign tax 51 99 486 516 Deferred tax - origination and reversal of 330 274 temporary differences Tax expense 816 790 Deferred tax relates to the utilisation of the deferred tax asset recognised on the acquisition of the ToLuna SAS in respect of accumulated tax losses and other timing differences arising in the period. Tax reconciliation Year ended Year ended 31 December 31 December 2007 2006 £'000 £'000 Profit before tax 3,186 2,238 Tax at 30 per cent. on profit before tax 956 671 Effects of: Non deductible items 146 41 Foreign tax rates (9) 11 Unutilised losses in foreign subsidiaries - 21 Other timing differences 36 46 Research and development tax credit (313) - Tax expense 816 790 4 Dividends The Company paid a dividend of 0.5 pence per share on 29 June 2007 amounting to £179,828 and 0.37 pence per share on 19 October 2007 amounting to £133,073. 5 Earnings per share Earnings per share has been calculated on a profit after tax of £2,370,000 (2006: £1,448,000) and the weighted average number of shares in issue for the period of 35,947,613 (2006: 35,915,245). The diluted earnings per share are calculated on the assumption that all options granted were exercised. This would give rise to a total weighted average number of ordinary shares in issue for the period of 38,629,905 (2006: 36,590,436). Year ended 31 December Year ended 31 December 2007 2006 Basic Diluted Basic Diluted £'000 £'000 £'000 £'000 Profit for the financial 2,370 2,370 1,448 1,448 year Earnings per share 6.59p 6.14p 4.03p 3.96p * Availability of Accounts Copies of the Report and Accounts will be sent to shareholders shortly and will be available from the registered office of the Company, 29 Curzon Street, London W1J 7TL and the Company's website www.toluna-group.com.

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