Europe, Middle East & Africa

	Year to 31 December
	1998	1997	1996
Revenue (£m)	1,566	1,484	1,564
% change
actual	6%	(5%)
comparable	8%	6%
Contribution (£m)	538	498	588
% change
actual	8%	(15%)
comparable	13%	2%
Actual operating margin	34%	34%

Revenue growth at comparable rates in the more mature European markets was in the range of 5%–10%, with 7% growth in the UK and Ireland and 6% growth in Germany.

Revenue from the emerging markets in central and eastern Europe continued to grow strongly, up 13% at comparable rates, despite the deteriorating economic environment in Russia.

Contribution growth at comparable rates of 13%, ahead of revenue growth of 8%, reflected the impact of tight cost control across the region.

Asia/Pacific

	Year to 31 December
	1998	1997	1996
Revenue (£m)	466	496	504
% change
actual	(6%)	(2%)
comparable	3%	9%
Contribution (£m)	177	184	193
% change
actual	(4%)	(5%)
comparable	7%	9%
Actual operating margin	38%	37%

Revenue growth at comparable rates of 3% was depressed by the impact of the Asian financial crisis on the region’s economy. Revenue growth in Japan was 8% at comparable rates.

Tight cost control resulted in contribution growth of 7% at comparable rates despite the low level of revenue growth.

The Americas

	Year to 31 December
	1998	1997	1996
Revenue (£m)	454	437	440
% change
actual	4%	(1%)
comparable	5%	6%
Contribution (£m)	25	37	26
% change
actual	(33%)	45%
comparable	(36%)	76%
Actual operating margin	5%	8%

Revenue from the Americas, which excludes Instinet and TIBCO, grew 4% at actual rates and 5% at comparable rates in 1998.

North American revenue grew 5% at comparable rates reflecting continuing demand for information products. Revenue grew 11% at comparable rates in Latin America.

The decline in contribution reflected development and infrastructure costs to support new domestic products.

Instinet

	Year to 31 December
	1998	1997	1996
Revenue (£m)	446	383	346
% change
actual	16%	11%
comparable	18%	17%
Contribution (£m)	155	149	135
% change
actual	3%	11%
comparable	6%	18%
Actual operating margin	35%	39%

Instinet’s 1998 revenue growth of 18% at comparable rates reflected growth in the second half of the year of 23%, compared to 13% in the first half, as a result of higher levels of activity.

At comparable rates, Instinet revenues in the US grew 10% compared with 15% growth in 1997. Revenue growth in the second half of the year was 17% compared with 3% in the first half of 1998.

Revenue growth from activities outside the US was 70%. Revenues from this segment now represent nearly 20% of total Instinet revenues. Growth was driven principally by increased trading in European equities.

The lower level of contribution growth compared to revenue growth resulted in a decline in margin to 35% from 39% in 1997. This reflected additional costs associated with capacity requirements and product development during 1998.

For information concerning certain rules that could affect Instinet’s business see Cautionary Statements: ‘SEC rules on ECN usage’, ‘SEC rules for Alternative Trading Systems’, and ‘NASD initiatives’.

TIBCO

	Year to 31 December
	1998	1997	1996
Revenue (£m)	100	82	60
% change
actual	23%	37%
comparable	24%	45%
Contribution (£m)	13	15	12
% change
actual	(13%)	23%
comparable	(14%)	30%
Actual operating margin	13%	18%

TIBCO comprises two units, TIBCO Finance Technology, which focuses on the finance sector and TIBCO Software, which pursues opportunities outside the finance sector. Minority shareholdings in TIBCO Software are held by Cisco Systems Inc and Mayfield Venture Capital.

Revenue continued to grow at double digit levels in both businesses. However, overall operating margin and profit overall declined due to continuing investment in product development and increased sales support costs.