I returned last night from London, where I attended the monthly Incisive Media board meeting. Having shared with my colleagues on the board our performance for the first three months of the year, I want to do the same for you.

As we projected would happen back at the start of the year, this has been an extremely challenging few months. We knew that advertising sales would be difficult--and they have been--and that other parts of our business were also vulnerable to the economic downturn. So we determined as the year began to find significant cost savings to offset those likely revenue declines. With your active participation that's exactly what we have done.

On the revenue side of the ledger we have seen some successes--our newspapers have done quite well in almost all areas but particularly in the public notice arena; our Canadian conference group has done extremely well; and our US legal events group has experienced good success during the early part of the year. But those pluses have been offset to a large degree by the expected weakness in magazine advertising, particularly from law firms; in our book group which has seen softness in sales of both new books and updates; and in our real estate group, which is suffering along with the rest of the commercial real estate industry. We expect all of those sales challenges to continue for the remainder of the year.

Our real success as a group has come from the expense savings program we launched in February. Virtually every expense area we track is under budget as we have become much more prudent in our spending decisions. I had set a target for us of finding $6 million in savings compared with our budgeted expenses, and we are on track to meet that goal.

Our Cost Savings Committee continues to meet in order to review, line-by-line, our spending policies and where we can make changes which will save us money without impacting the quality of our products and services. That group is currently investigating a number of areas, including company policies regarding cell phone usage, printing costs for marketing/promotion materials, bulk mailing, air travel, and internet usage charges for those who work from home. Many of these are ideas which originally came from the staff.

Although not included in the North American Group's financial reports, I also want to note that the Interactive Marketing team has done well through tight cost control and creative approaches to their highly competitive marketplace.

Our preliminary look at the next three months shows continued challenges on the revenue side of the equation. Law firms have been tightening their belts, and we are clearly feeling the pressure from slowdowns in advertising, hiring and product purchases. We think that situation will ease by the middle of 2010--but our crystal ball is as cloudy as anyone else's, so we'll need to be very careful as we plan for the future.

Speaking of the future, while in London I also reconfirmed the company's commitment to our IT spending plans for the balance of the year. We have ambitious plans for new web tools and new products, and I'm excited that we're moving forward to turn those dreams into reality. Those projects include enhanced access control and content tagging, two critical aspects of our new product planning for the coming year. We're also moving ahead with a redesign of the ClickZ and Search Engine Watch sites, which will be the first on our side of the Atlantic to be built on the new V9 content management system platform.

Lastly, for those wondering about the refinancing of the company's debt obligations, there's not much new to report. Those discussions primarily relate to the UK Group's debt (which is separate from the North American Group's borrowings) and have no impact on our day-to-day operations. I hope this will all be resolved in the next month or two. For us, a more sensible capital structure would make it easier to pursue selected acquisitions which could have an extremely positive impact on our business in future years. So I'm anxious to see it all resolved as soon as possible.

Finally, on a personal note, it was nice following President and Mrs.Obama to London, since they left behind a favorable impression of where the US is headed. No one I met seemed to mind that Mrs.Obama had put her arm around the Queen.