Total costs grew 8% in 1998 at comparable exchange rates, compared with revenue growth of 9%. In 1997 both revenue and costs grew by 9%.

Costs by type

	Year to 31 December
(£m)	1998	1997	1996
Staff	928	835	856
Services	586	585	539
Depreciation	331	312	283
Data	242	207	195
Communications	207	201	202
Space	129	142	150
Cost of sales and other	52	64	59
Goodwill amortisation	46	51	49
Currency hedging activities – net gain	(45)	(56)	(5)
Foreign currency translation – net loss/(gain)	6	–	(6)
Total	2,482	2,341	2,322
% change
actual	6%	1%
comparable	8%	9%

	Year to 31 December
Staff	1998	1997	1996
Cost (£m)	928	835	856
% change
actual	11%	(2%)
comparable	14%	5%

Total staff costs increased 14% at comparable rates, reflecting growth in staff numbers, the impact of inflationary increases, and costs related to the company reorganisation.

Total staff numbers grew by 5% in the year to 16,938 at 31 December 1998. Approximately half of this growth related to Instinet and TIBCO. The net effect of acquisitions and disposals was not material. In 1997, staff numbers grew 4% to 16,119.

	Year to 31 December
Services	1998	1997	1996
Cost (£m)	586	585	539
% change
actual	–	9%
comparable	2%	17%

Cost containment initiatives continued to restrict services spending, although there was an increase in consultancy and contractor costs to support the millennium and euro projects.

	Year to 31 December
Depreciation	1998	1997	1996
Cost (£m)	331	312	283
% change
actual	6%	10%
comparable	7%	11%

The depreciation charge grew at a slower rate in 1998 reflecting a reduction in the level of capital expenditure.

	Year to 31 December
Data	1998	1997	1996
Cost (£m)	242	207	195
% change
actual	17%	6%
comparable	20%	12%

Growth in data costs was principally due to the continuing increase in recoverable exchange fees on equity products and increased demands for specialist data.

	Year to 31 December
Communications	1998	1997	1996
Cost (£m)	207	201	202
% change
actual	3%	–
comparable	7%	7%

Volumes of data delivered over Reuters products continued to increase. The associated increase in costs was partially offset by savings from the sale of the satellite services business in 1997 and tariff reductions. The most significant growth was in local distribution costs, which are largely recoverable from clients.

	Year to 31 December
Space	1998	1997	1996
Cost (£m)	129	142	50
% change
actual	(9%)	(6%)
comparable	(7%)	1%

No significant expansion or refurbishment costs were incurred in 1998.