FIMALAC: An Exceptional Year in 2005 - Hearst Corporation Becomes a 20% Partner in Fitch Group

The Board of Directors of Fimalac met on March 15, to review and approve the 2005 financial statements. The Board also approved the sale of a 20% interest in Fitch Group to Hearst Corporation.I) AN EXCEPTIONAL YEAR

In 2005, Fimalac successfully completed its refocusing, following the divestment of its non-strategic manufacturing businesses. Fitch Ratings delivered another set of excellent results and the Group expanded into the enterprise risk management sector by acquiring Algorithmics.

1) Recurring operating profit up 60.4% like-for-like*

On a reported basis, now corresponding to Fitch Group and corporate costs, recurring operating profit, amounted to EUR 107.2 million, on revenue of EUR 557.9 million, versus EUR 76.1 million and EUR 412.7 million respectively in 2004. Like-for-like results, which provide a better indication of underlying performance, were as follows:

 -- -------------------- ---------------- -------- ---------- 
|  |                    |  Like-for-like*|        |          |
 -- -------------------- ---------------- -------- ---------- 
|  |     (in  millions)|            2004|    2005|    Change|
 -- -------------------- ---------------- -------- ---------- 
|  |             Revenue|           412.7|   491.9|    19.2 %|
 -- -------------------- ---------------- -------- ---------- 
|  |Recurring operating |            76.1|   122.1|    60.4 %|
|  |profit              |                |        |          |
 -- -------------------- ---------------- -------- ---------- 
|  |Recurring operating |          18.4 %|  24.8 %|          |
|  |profit as a % of    |                |        |          |
|  |revenue             |                |        |          |
 -- -------------------- ---------------- -------- ---------- 
 -- -------------------- ---------------- -------- ----------

* Based on an identical Group structure and constant exchange rates.

Fitch Ratings enjoyed excellent revenue and earnings performance, across nearly all ratings segments and geographic regions. Revenue and earnings from the risk management business included the contribution of Algorithmics, which was acquired at the end of January.

In all, Fitch Group - comprising Fitch Ratings and Algorithmics - ended the year with recurring operating profit of EUR 120.5 million (2004: EUR 88.4 million), up 36.3% on a reported basis and 53.2% like-for-like, on revenues of EUR 556.1 million (2004: EUR 411.6 million), up 35.1% on a reported basis and 19.2% like-for-like. Like-for-like recurring operating margin rose significantly, to 27.6% in 2005 from 21.5% the year before.

2) Net profit of EUR 57.6 million, not including the profit on the sale of Facom

Net profit for the year came to EUR 57.6 million (2004: EUR 46.4 million). This figure includes the very good results of Fitch Group, the profit on the 2005 business divestments and Fimalac's share of Facom's net profit. As a result, it is not a good reflection of how the Group's current businesses performed.

The sale of Facom was completed on January 1, 2006 and the profit on the sale - which will top EUR 80 million - will therefore be recorded in the 2006 accounts.

3) Recommended 2005 dividend: EUR 1.25 per share, an increase of 19%

At the Annual Shareholders' Meeting of May 30, the Board of Directors will recommend a 19% increase in the dividend to EUR 1.25 per share (2004 dividend: EUR 1.05). The dividend will be paid as from June 1.

II) SALE OF A 20% INTEREST IN FITCH GROUP

Fimalac today signed a memorandum of understanding with US-based Hearst Corporation for the sale of a 20% interest in Fitch Group (formerly Fimalac, Inc.). The transaction is being announced in a separate press release.

The negotiations were based on an enterprise value, for 100% of Fitch Group, of $4,434 million (EUR 3,695 million based on a dollar exchange rate of $1.2).

This puts the sale price of a 20% interest in Fitch Group at around $592 million (EUR 493 million) after taking into account the discount applied to minority stakes and Fitch Group's debt at the Closing. The net disposal gain is estimated at EUR 380 million after tax. The sale proceeds should be received before the end of April.

Hearst Corporation is one of the United States' largest privately-owned companies and one of the world's leading communication groups.

Hearst's strong roots in the United States should ensure that the partnership contributes to maintaining Fitch Group's growth momentum, while creating opportunities for synergies in the area of financial information.

III) NEW SHARE BUYBACK PROGRAM

Fimalac's significant cash reserves, after collecting the proceeds from the sale of Facom and 20% of Fitch Group, will be used to speed development of the ratings and enterprise risk management business by taking up any opportunities that may arise in this segment.

However, the Board of Directors has also decided to launch a new share buyback program, subject to shareholder approval at the General Meeting of March 16. In addition, the Board has decided to cancel 400,000 Fimalac shares held in treasury, representing 1.06% of the capital.