Preliminary Results

IP Group PLC
05 March 2007



For immediate release                                              05 March 2007


                  ('IP Group' or 'the Group' or 'the Company')

            Preliminary results for the year ended 31 December 2006


IP Group plc (LSE: IPO), the intellectual property commercialisation company,
today announces its audited preliminary results for the year ended 31 December
2006.


Financial Highlights

 • Profit after taxation: £40.1m (2005: £5.6m)
 • Fair value of equity investments: £87.4m (2005: £44.3m)
 • Cash proceeds from sales of equity investments: £3.1m (2005: £0.8m)
 • Cash balance at 31 December 2006: £51.3m (2005: £39.9m)
 • Investment in spin-out companies: £8.5m (2005: £4.2m)


Operational Highlights

 • Successful flotation of three portfolio companies during 2006 (2005:
   two)
 • 53 spin-out companies at 31 December 2006 (2005: 37)
 • Five new university partnerships signed with the Universities of Bath,
   Glasgow, Queen Mary (University of London), Surrey, and York, taking the
   total number of university partnerships to ten
 • Eight successful follow-on funding rounds for spin-out companies
 • Modern Water launched to address the global issue of the economic
   availability of fresh water
 • IP Exec, IP Group's in-house executive search function, launched in the
   year
 • Modern Biosciences plc in-licenses first compound as a result of its
   Memorandum of Understanding with the University of Manchester
 • IP Venture Fund, a collaboration with the European Investment Fund
   launched and makes its first follow-on round investments in IP Group
   spin-out businesses
 • IP Group admitted to the Official List of the UK Listing Authority


Post Year End Highlights

 • Eco Chemical Enterprises plc (formerly Perachem Limited), a spin-out
   from the University of Leeds, joins PLUS Markets.


Commenting on the Group's preliminary results, David Norwood, Chairman of IP
Group, said:

'The success of the first half of the year has continued in the second half,
making 2006 the most profitable year in the Group's history. Three companies
from the IP Group portfolio listed on AIM during 2006 while a further eight
companies in the private portfolio raised additional capital.

The first half of 2007 has started well with the flotation, through a reverse
takeover, of a spin-out company from the University of Leeds. I believe that the
critical mass IP Group has in the technology transfer sector, as well as the
quality of our tried and tested model, positions the Group well to continue to
be the leading intellectual property commercialisation company in the UK.'


For more information, please contact:

IP Group plc
David Norwood, Chairman                                       020 7489 5200
Alan Aubrey, Chief Executive Officer
William Turner, Group Financial Controller
Liz Vaughan-Adams, Communications             020 7489 5206 / 07979 853 802

Further information on IP Group is available on our website: www.ipgroupplc.com

Buchanan Communications                                       020 7466 5000
Mark Court, Tim Anderson, Mary-Jane Johnson



CHAIRMAN'S STATEMENT

In 2006, IP Group plc consolidated its position as the UK's leading intellectual
property commercialisation company with the addition of five further university
partnerships, taking the Group's total number of university partners to ten. The
Group has unparalleled access to some of the UK's finest academics and their
ideas and has built a proven platform for creating value for the benefit of our
shareholders and our university partners.

I am pleased to report that the success of the first half of 2006 has continued
in the second half, making 2006 the most profitable year in the Group's history.
In 2006 the Group generated profits after taxation of £40.1m (2005: £5.6m)
principally as a result of net fair value gains within the university
partnership business of £38.2m (2005: £5.7m). Notable gains included those
achieved on the listing of both Oxford Catalysts Group plc and Avacta Group plc,
together generating gains of £22.6m. Whilst the timing of transactions can be
difficult to predict, I am confident that there is sufficient quality within IP
Group's growing portfolio of university spin-outs that the Group will continue
to generate value for its shareholders and university partners over the coming
months and years.

Our cash position remains strong with £51.3m of cash at the year end (2005:
£39.9m). The Group generated £3.1m of cash proceeds from its spin-out portfolio
(2005: £0.8m) and continued to control costs carefully.

The Group has expanded its follow-on funding capability during the year, with
the launch of IP Venture Fund in conjunction with the European Investment Fund
(the 'EIF'), one of the leading investors in venture capital funds in Europe.
The Group is already seeing the positive results of this collaboration with a
total of four separate investments being made to date in follow-on fundraisings
in IP Group spin-out companies. I wish to take this opportunity, on behalf of
the Group, to thank the EIF for their ongoing support and commitment to the
commercialisation of university intellectual property in Europe.


Outlook

The current year has started well for IP Group with the Company already having
completed its first corporate transaction with the listing of Eco Chemical
Enterprises plc (formerly Perachem Limited), a spin-out from the University of
Leeds, on PLUS Markets Group via a reverse takeover.

The Group has also continued to develop a number of models based on the economic
theme of creating value from university intellectual property. As an example of
this, in December 2006 the Group launched Modern Water Limited ('Modern Water')
to access and develop leading research in order to address the global economic
problem of availability of fresh water. This model of forming a business around
an issue of global importance and then identifying relevant intellectual
property to address that issue represents a natural extension of the Group's
traditional spin-out model and I am confident it is one that will benefit both
our shareholders and our university partners.

The Group continues to attract talented individuals to fill strategic roles
within the business. I am pleased to announce the appointment of Mike Townend to
the Board of Directors as Director of Capital Markets. Mike was formerly
Managing Director - Equities at Lehman Brothers and has extensive experience of
raising capital from the public markets. I would like to wish Mike well in his
new role.

Dr Alison Fielding will be assuming an increased role as Chief Technology
Officer responsible for all pre-spin-out formation activities. Dr Bruce Campbell
is today stepping down from the Board of Directors. Bruce has served as Chief
Scientific Officer since joining the Board in 2004 and has contributed
enormously to the development of the Group to date. Bruce will remain involved
with the Group, serving on the boards of a number of Group portfolio companies.
I would like to thank Bruce for his contribution to the Board and look forward
to continuing to work with him in the future.

The profile of the technology transfer industry in the UK has been raised
significantly during 2006 with a number of new partnership collaborations
between private companies and UK universities. We believe that the critical mass
we have in this sector, as well as the quality of our tried and tested model,
positions the Group well to continue to be the leading intellectual property
commercialisation company in the UK and to generate significant value for our
shareholders and university partners.

I would like to conclude by thanking our shareholders, our university partners,
the managers of our portfolio companies and our staff for their continued
support in what has been a profitable and productive year in the growth and
development of IP Group.


DAVID NORWOOD
Chairman
5 March 2007



CHIEF EXECUTIVE'S STATEMENT

In 2006 IP Group delivered record profits, largely as a result of uplifts on the
carrying value of the Group's university spin-out portfolio. At 31 December
2006, the business had a portfolio of 53 spin-out businesses. At the date of
this statement a total of nine companies from the Group's portfolio have now
joined either the Alternative Investment Market ('AIM') or PLUS Markets.


Strategic review

University partnership business

In the year ended 31 December 2006, the Group increased its partnerships with
universities from five to ten. In addition to adding partnerships with the
universities of Surrey, Queen Mary (University of London), Bath and York as
reported at the half year, the Group entered into a 25 year collaboration with
the University of Glasgow in October 2006. The partnership between IP Group and
the University of Glasgow is the Group's first collaboration with a Scottish
university. The University of Glasgow has a promising portfolio of new spin-out
businesses and in February 2007 we announced an investment in Wireless
bioDevices Limited, the first spin-out as a result of this collaboration. In
addition, in March 2006, Modern Biosciences plc, the Group's drugable IP
in-licensing subsidiary, signed a Memorandum of Understanding with the
University of Manchester relating to the commercialisation of drug related
intellectual property.

Our ten university partnerships represent a very significant proportion of the
total scientific research base in the UK and these partnership agreements
represent a major asset of the business. We believe that no other intellectual
property commercialisation company in the UK currently has access to such an
extensive portfolio of intellectual property as IP Group. IP Group's success
depends on its ability to work with its university partners to identify
opportunities from the concepts and ideas generated from this research base and
to progress those opportunities through to value creation.


Economic issues driven business

In 2005 the Group initiated a strategy of establishing businesses, run by
specialist management teams, to address particular issues affecting the global
economy through the creation and management of a portfolio of
intellectual-property based investments.

In December 2006, the Group announced the launch of a new subsidiary, Modern
Water, to establish and exploit a portfolio of water technologies to address the
global problem of economic availability of fresh water.

Modern Water's Chairman, Neil McDougall, is an experienced water-industry expert
with a proven track record in this sector. Simon Humphrey, who has over 16 years
experience in the sector, is Modern Water's Chief Executive Officer. IP Group
and Modern Water's management team have invested £2.2 million in cash to Modern
Water. Modern Water has invested £1.0 million of this total in three
water-related technologies, comprising an innovative and potentially cost-saving
desalination process, a technology that continuously measures acute water
toxicity and a patented process for flushing toilets with seawater rather than
freshwater. Modern Water is actively seeking further opportunities.

Modern Water is the second subsidiary that IP Group has created to address
issues of global importance, having launched Modern Biosciences in 2005 to
address the problem of poor product pipeline within large pharmaceutical
companies. In July 2006, Modern Biosciences announced that it had in-licensed
its first opportunity as part of its exclusive licence and research agreement
with the University of Manchester. This opportunity will centre on the
development of a new class of cancer drug targeting platinum resistant tumours.


Fund management business

In July 2006, the Group launched IP Venture Fund (the 'Fund') in partnership
with the European Investment Fund, one of the leading investors in venture
capital funds in Europe. The Fund can invest up to 25% in post seed financings
in IP Group's portfolio of spin-out companies. This capability will
significantly enhance IP Group's ability to attract follow-on capital into its
portfolio. In November 2006, the Fund made its first two investments, both
spin-out companies from the University of Oxford. Since the year end the Fund
has made two further investments in Eco Chemical Enterprises plc (formerly
Perachem Limited) and Revolymer Limited.

IP Group's fund management subsidiary, Top Technology Ventures Limited, manages
two further funds, HATT III LP and Top Technology Ventures IV LP. This activity
contributed £1.3m of fund management income in 2006 (2005: £1.2m). As the
investments in HATT III LP and Top Technology Ventures IV LP are realised and
the Funds are terminated over the coming years it is anticipated that the
associated fund management income will also reduce.


Corporate developments

Awareness of the Group has been raised significantly both domestically and
internationally following the move to the Official List of the UK Listing
Authority in June 2006 from AIM.

In April 2006 the Group changed its name to IP Group plc from IP2IPO Group plc.
The change of name encapsulates the Group's strategy of developing multiple
models for the commercialisation of university intellectual property and it has
received positive feedback from shareholders and university partners alike.

In October 2006 Stuart Thompson joined the Group to head up IP Exec, the Group's
in-house executive search function. IP Exec has been instrumental in placing a
number of senior executives within IP Group spin-out businesses. Recruitment of
high quality management is a critical part of the IP Group spin-out formation
process, a process that is only successful with the correct mixture of world
leading intellectual property from within our university partners, development
capital and experienced management.



Financial and operational review

Portfolio performance

In 2006 the Group recorded net fair value gains of £38.2m (2005: £5.7m). An
analysis of fair value gains is given below:
                                                             2006         2005
                                                              £'m          £'m
-----------------------------------------                   -------       ------
Gains on the revaluation of investments                      47.8         14.1
Losses on the revaluation of investments                     (9.6)        (8.4)
-----------------------------------------                   -------       ------
Net fair value gains                                         38.2          5.7
-----------------------------------------                   -------       ------


In April 2006 Oxford Catalysts Group plc ('OCG') listed on AIM, capitalising OCG
at £65m. OCG raised £15m of cash funding at flotation. At 31 December 2006 the
fair value of the Group's 23.9% stake in OCG was £12.9m, generating a fair value
gain of £12.5m on a mark-to-market basis.

Avacta Group plc ('Avacta'), a spin-out from the University of Leeds, reversed
into an AIM listed company in August 2006. The Group's 26.1% stake in Avacta had
a fair value at 31 December 2006 of £10.5m. At 31 December 2006 the Group
recorded an uplift in value of £10.1m on a mark-to-market basis.

At 31 December 2006 the Group's 9.6% stake in Offshore Hydrocarbon Mapping plc
('OHM') was valued at £4.9m. The carrying value of the Group's stake represents
an uplift in value of £2.5m. In the year ended 31 December 2005 the Group had
previously recorded a mark-to-market loss of £4.7m on its holding in OHM.

The Group invested £0.5m in COE Group plc in August 2006. At 31 December 2006
the Group's 31.4% stake in COE Group plc was valued at £2.3m. A gain of £1.8m
has been recorded in the Group's income statement.

Within the private portfolio, Oxford NanoLabs Limited and Ilika Technologies
Limited raised capital generating fair value gains of £10.3m and £5.5m
respectively. The Group holds stakes of 41.6% and 23.0% in these companies
respectively.

In 2006 total mark-to-market losses on the Group's quoted portfolio amounted to
£5.4m (2005: £5.6m). At 31 December 2006 eight companies in the Group's
portfolio had joined either AIM or PLUS Markets, and with the successful listing
of Eco Chemical Enterprises plc (formerly Perachem) on PLUS Markets in January
2007, this figure now stands at nine. The Group has built a diversified
portfolio of equity stakes where individual gains and losses have a reduced
proportional effect on the total portfolio performance. Fair value losses in the
Group's private portfolio at 31 December 2006 amount to £4.2m (2005: £2.8m).


Proceeds on disposal of equity investments

In 2006 the Group generated cash proceeds of £3.1m on disposals of equity stakes
(2005: £0.8m).

The Group realised cash proceeds on the disposal of investments of £2.0m
following the successful sale on listing of 1,149,425 ordinary shares in Oxford
Catalysts Group plc. The Group also generated £0.5m of cash from the private
sale of the Group's equity stake in Stratophase Limited and £0.6m of cash from
the sale of shares in GETECH Group plc.

The Group will seek to continue to dispose of stakes in portfolio companies in
accordance with the Group's disposal policy and only when prudent to do so.


Spin-out creation

At 31 December 2006 the Group held equity stakes in 53 companies (2005: 37).
Three companies from the portfolio, Oxford Catalysts Group plc, Syntopix Group
plc and Avacta Group plc, listed on AIM during the year. Eight companies in the
portfolio achieved successful follow-on funding rounds during the year.

                                                         
                            Unquoted spin-   Quoted spin-              Total
                             outs (number)  outs (number)           (number)
-------------------------       ----------      ----------         ----------
At 1 January 2006                      32               5                 37
New spin-out businesses                16               -                 16
Companies listed during
the year                               (3)              3                  -
-------------------------        ----------      ----------          ---------
At 31 December 2006                    45               8                 53
-------------------------        ----------      ----------          ---------


In 2006 the Group invested £8.0m in sixteen new portfolio companies.

In 2006 IP Venture Fund made its first follow-on investments in IP Group
spin-out companies, investing a total of £0.7m in two portfolio companies. Since
the year end IP Venture Fund has invested a further £0.8m in two portfolio
companies. At 31 December 2006, IP Venture Fund had a further undrawn commitment
of £14.7m available for investment in IP Group spin-out company follow-on
funding rounds.


Cash

At 31 December 2006 the Group had cash of £51.3m (2005: £39.9m).The principal
constituents of the increase in cash during the year can be summarised as
follows:
                                                             2006         2005
                                                              £'m          £'m 
---------------------------------------                     -------      -------
Net cash used in operating activities                        (1.4)        (2.5)
Net cash used in investing activities                        (6.2)        (6.3)
Issued share capital                                         19.0         13.9
---------------------------------------                     -------      -------
Movement during the year ended 31 December                   11.4          5.1
---------------------------------------                     -------      -------


In 2006 the Group covered its administrative expenses with receipts from fund
management income, consultancy income and interest. However, the Group
experienced a cash deficit on its operating activities of £1.4m (2005: £2.5m) as
a result of an increase in debtors of £0.7m and the settlement of £0.7m of
national insurance obligations arising on the exercise of unapproved share
options. The increase in the Group's debtors relates to accrued interest
receivable on bank deposits and amounts fully recoverable from fund management
activity. The Group continues to monitor overhead costs carefully, the biggest
constituent of which is employee related cost. In 2007, as Modern Biosciences
plc commissions further proof of concept work, it is anticipated that research
expenditure will constitute a greater overall proportion of operating costs than
it did in 2006.

The Group invested £8.5m (2005: £4.2m) in new spin-outs, one public company and
follow on funding and £0.2m in limited partnership funds. The Group generated
cash proceeds on the sale of equity stakes of £3.1m (2005: £0.8m). The Group
settled £0.7m of deferred consideration owed on the acquisition of Techtran
Group Limited and received a £0.1m repayment against the financial asset due
from the University of Leeds.

During 2006 the Group issued new share capital for cash proceeds of £19.0m
(2005: £13.9m). In May 2006 the Group carried out a share placing which raised
£16.3m. In addition, employees exercised share options during the year which
generated £2.7m of cash for the Group.

At 31 December 2006, the Group had £40.5m ring-fenced for seed round finance in
spin-out companies from university partners. In addition, Modern Biosciences has
committed up to £1.4m as a result of its research agreement with the
Universities of Manchester and Salford for the development of a new class of
cancer drug. The Group also had un-drawn commitments of £1.2m for investment in
the IP Venture Fund.


Taxation

The Group's directors continue to believe that the Group qualifies for the
Substantial Shareholdings Exemption ('SSE') on chargeable gains arising on
disposal of qualifying holdings. In 2006 the Group obtained a post-transaction
clearance from H M Revenue & Customs under Code of Practice 10 (CoP10) that SSE
applied to the Group's disposal of shares in Stratophase Limited. The Group has
therefore not recognised a deferred tax provision on gains arising on its
portfolio of equity stakes.


ALAN AUBREY
Chief Executive Officer


5 March 2007


CONSOLIDATED INCOME STATEMENT
For the year ended 31 December 2006

--------------------------------               ------     ---------     --------
                                                Note         2006         2005
                                                              £'m          £'m
--------------------------------               ------     ---------     --------
Revenue
Change in fair value of equity investments                   38.2          5.7
Gains on disposal of equity investments                       1.9          0.8
Dividends                                                     0.1          0.2
Revenue from services                                         1.8          1.7
--------------------------------               ------     ---------     --------
                                                             42.0          8.4
--------------------------------               ------     ---------     --------
Administrative expenses
Employee bonus costs                                         (0.3)        (1.2)
Official list costs                                          (0.3)           -
Other administrative expenses                                (3.6)        (3.4)
--------------------------------               ------     ---------     --------
                                                             (4.2)        (4.6)
--------------------------------               ------     ---------     --------
Operating profit                                             37.8          3.8
Finance income - interest receivable                          2.3          1.8
--------------------------------               ------     ---------     --------
Profit before taxation                                       40.1          5.6
Taxation                                                        -            -
--------------------------------               ------     ---------     --------
Profit for the year                                          40.1          5.6
--------------------------------               ------     ---------     --------

Profit attributable to:
Equity holders of the parent                                 40.1          5.6
Minority interest                                               -            -
--------------------------------               ------     ---------     --------
                                                             40.1          5.6
--------------------------------               ------     ---------     --------
Basic earnings per ordinary share (p)             2         16.84         2.52
--------------------------------               ------     ---------     --------
Diluted earnings per ordinary share (p)           2         16.66         2.45
--------------------------------               ------     ---------     --------






CONSOLIDATED BALANCE SHEET
As at 31 December 2006
--------------------------------               ------     ---------     --------
                                                Note          2006       2005
                                                               £'m        £'m
--------------------------------               ------     ---------     --------
ASSETS
Non-current assets
Intangible assets:
Goodwill                                                       18.7       18.4
Acquired intangible assets                                      0.5        0.6
Property, plant and equipment                                   0.1        0.1
Equity rights and related acquisition costs                    20.3       20.2
Equity investments                                     4       87.4       44.3
Financial asset                                                 1.1        1.3
Investment in limited partnerships                              0.3        0.1
------------------------------                       -----  ---------  ---------
Total non-current assets                                      128.4       85.0
------------------------------                       -----  ---------  ---------
Current assets
Trade and other receivables                                     2.2        2.0
Cash and cash equivalents                                      51.3       39.9
------------------------------                       -----  ---------  ---------
Total current assets                                           53.5       41.9
------------------------------                       -----  ---------  ---------

Total assets                                                  181.9      126.9
------------------------------                       -----  ---------  ---------
EQUITY AND LIABILITIES
Equity attributable to equity holders of the parent
Share capital                                                   4.9        4.6

Share premium account                                          92.0       73.3

Merger reserve                                                 12.8       12.8

Retained earnings                                              69.2       29.1
------------------------------                       -----  ---------  ---------

Total shareholders' equity                                    178.9      119.8
------------------------------                       -----  ---------  ---------
Minority interest in equity                                     0.3          -
------------------------------                       -----  ---------  ---------

Total equity                                           3      179.2      119.8
------------------------------                       -----  ---------  ---------
Non-current liabilities
Trade and other payables                                          -        3.6
Provisions                                                      0.1        0.5
------------------------------                       -----  ---------  ---------
Total equity and non-current liabilities                      179.3      123.9
------------------------------                       -----  ---------  ---------
Current liabilities

Trade and other payables                                        2.6        3.0
------------------------------                       -----  ---------  ---------
Total equity and liabilities                                  181.9      126.9
------------------------------                       -----  ---------  ---------





CONSOLIDATED CASHFLOW STATEMENT
For the year ended 31 December 2006


------------------------------                           ------------  ---------                                        
                                                               2006       2005
                                                                £'m        £'m
------------------------------                           ------------  ---------
Operating activities
Profit before taxation                                         40.1        5.6
Finance income - interest receivable                           (2.3)      (1.8)
Fair value movements in equity investments                    (38.2)      (5.7)
Amortisation of intangible non-current assets                   0.2        0.2
Profit on disposal of equity investments                       (1.9)      (0.8)
Equity allocated to staff                                       2.1          -
Share-based payment charge                                        -        0.3
(Increase) / decrease in trade and other receivables           (0.7)       0.3
Decrease in trade and other payables and provisions            (2.6)      (1.7)
Dividends classified as investing activities cash flows        (0.1)      (0.2)
Interest received                                               2.0        1.3
------------------------------                           ------------  ---------
Net cash outflow from operating activities                     (1.4)      (2.5)
------------------------------                           ------------  ---------
Investing activities
Purchase of equity investments                                 (8.5)      (4.2)
Investment in Limited Partnership Funds                        (0.2)         -
Financial asset                                                 0.1       (1.4)
Purchase of subsidiary undertaking                             (1.0)      (3.5)
Net cash acquired with subsidiary                               0.2        1.8
Proceeds from sale of equity investments                        3.1        0.8
Dividend received                                               0.1        0.2
------------------------------                           ------------  ---------
Net cash outflow from investing activities                     (6.2)      (6.3)
------------------------------                           ------------  ---------
Financing activities
Proceeds from issue of share capital                           19.0       13.9
------------------------------                           ------------  ---------
Net increase in cash and cash equivalents                      11.4        5.1
Cash and cash equivalents at the beginning of the year         39.9       34.8
------------------------------                           ------------  ---------
Cash and cash equivalents at the end of the year               51.3       39.9
------------------------------                           ------------  ---------



NOTES

1.       BASIS OF PREPARATION

The preliminary results for the year ended 31 December 2006 have been extracted
from audited accounts which have not yet been delivered to the Registrar of
Companies. The financial information set out in this announcement does not
constitute statutory accounts for the year ended 31 December 2006 or 31 December
2005. The financial information for the year ended 31 December 2006 is derived
from the statutory accounts for that year. The report of the auditors on the
statutory accounts for the year ended 31 December 2006 was unqualified and did
not contain a statement under Section 237 of the Companies Act 1985. The
statutory accounts for the year ended 31 December 2005 have been delivered to
the registrar, while the statutory accounts for the year ended 31 December 2006
will be delivered to the registrar following the company's Annual General
Meeting.


2.       EARNINGS PER SHARE

The basic and diluted profit per ordinary share is based on profits attributable
to ordinary shareholders for the year of £40.1m (2005: £5.6m). The basic profit
per share is based on the weighted average number of ordinary shares of
238,155,846 in issue during the year (2005: 222,813,505*). The diluted profit
per ordinary share in 2006 is based on the weighted average number of ordinary
shares plus the potentially dilutive options over ordinary shares totalling
241,190,446 (2005: 228,381,635*).


*Comparative figures restated following 5:1 share split in April 2006.



3.       CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDER'S EQUITY
                             Attributable to equity holders of the Company

------------------        ------        -------         -------   -------   ------   -------        ------
                           Share          Share          Merger  Retained           Minority         Total 
                         capital        premium         reserve  earnings    Total  interest        Equity
                             £'m            £'m             £'m       £'m      £'m       £'m           £'m
------------------        ------        -------         -------   -------   ------   -------        ------
At 1 January
2005                         4.1           59.6             0.8      23.3     87.8         -          87.8
Consolidated
profit for the
year                           -              -               -       5.6      5.6         -           5.6
Employee share
option charge                  -              -               -       0.3      0.3         -           0.3
Pre-acquisitio
n reserves
attributable
to the Group                   -              -               -      (0.1)    (0.1)        -          (0.1)
Issue of share
capital in the
year                         0.5           13.7            12.0         -     26.2         -          26.2
------------------        ------        -------         -------   -------   ------   -------        ------
At 1 January
2006                         4.6           73.3            12.8      29.1    119.8         -         119.8
Consolidated
profit for the
year                           -              -               -      40.1     40.1         -          40.1
Issue of share
capital in the
year                         0.3           18.7               -         -     19.0         -          19.0
Non-controllin
g interest                     -              -               -         -        -       0.3           0.3
------------------        ------        -------         -------   -------   ------   -------        ------
At 31 December
2006                         4.9           92.0            12.8      69.2    178.9       0.3         179.2
------------------        ------        -------         -------   -------   ------   -------        ------






NOTES (Continued)


4.       EQUITY INVESTMENTS - DESIGNATED AS 'AT FAIR VALUE THROUGH PROFIT OR LOSS'

---------------------        ---------       ---------   ----------  ---------
Group                  Quoted spin out   Unquoted spin        Other      Total
                             companies   out companies  investments
                                   £'m             £'m          £'m        £'m
---------------------        ---------       ---------   ----------  ---------
At 1 January
2005                              24.0             8.4          3.1       35.5
Investments
during the
year                                 -             4.8          0.4        5.2
Reclassificati
ons during the
year                               0.8            (0.8)           -          -
Disposal
during the
year                                 -            (0.1)           -       (0.1)
Change in fair
value in the
year                              (0.2)            6.0         (0.1)       5.7
Adjustment
arising on
consolidation
of Techtran
Group Ltd                            -               -         (2.0)      (2.0)
---------------------        ---------       ---------   ----------  ---------
At 1 January
2006                              24.6            18.3          1.4       44.3
Investments
during the
year                               0.7             7.8            -        8.5
Reclassificati
ons during the
year                               1.5            (1.5)           -          -
Disposal
during the
year                              (0.6)           (0.5)           -       (1.1)
Change in fair
value in the
year                              22.5            15.4          0.3       38.2
Equity
allocated to
staff                                -            (2.1)           -       (2.1)
Adjustment
arising on
consolidation
of Poseidon
Water Limited                                     (0.4)                   (0.4)
---------------------        ---------       ---------   ----------  ---------
At 31 December
2006                              48.7            37.0          1.7       87.4
---------------------        ---------       ---------   ----------  ---------



5.       POST BALANCE SHEET EVENTS

Perachem Ltd, a spin-out from the University of Leeds was renamed as Eco
Chemical Enterprises plc and joined PLUS Markets through a reverse takeover.


6.       AVAILABILITY OF STATUTORY ACCOUNTS

Copies of the full statutory accounts will be available from the registered
office at Warwick Court, 5 Paternoster Square, London EC4M 7BP, from 29 March
2007 and will also be available on the Group's website at www.ipgroupplc.com.


7.       ANNUAL GENERAL MEETING

The Annual General Meeting will be held at 3pm on 24 April 2007 at Buchanan
Communications, 45 Moorfields, London, EC2Y 9AE.






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