Informa PLC · LSE:INF
Informa — FY2008 Earnings Presentation
36 slides from Informa's earnings presentation, Mar 4, 2009
Slide 1: 2008 Preliminary Results
2008 Preliminary Results Peter Rigby Adam Walker 4th March 2009
Slide 2: Overview
Overview • Good set of results for 2008 • Double digit revenue and profit growth • Operating margin growth to 23.9% • Portfolio generates high quality of earnings • Outstanding cash conversion of 121% • Annualised cost savings of £33m • Good visibility of earnings for 2009 • Strategy to reduce debt
Slide 3: Strategy
Strategy • Delivery of high value content across multiple vertical markets, geography and media formats • Focus on recurring, visible and secure revenue streams • Leading publishing and events titles linked • Proactive cost reduction • Develop portfolio of industry leading “Must Attend” events • Ele
Slide 4: Quality of Earnings
Quality of Earnings • High renewal rates • (98% Academic, 86% FDA, 83% Datamonitor, 77% IBI) • High visibility - significant deferred income – 29% of full year’s revenues • Local Autonomy – rapid decision making and market reaction • Low dependence on advertising (3% of revenue) • Highly variable co
Slide 5: Strategy – Geographic Spread
Strategy – Geographic Spread 5
Slide 6: Strategy – Sector Analysis
Strategy - Sector Analysis % Revenue by Sector @ Energy & utilities @ Finance @ Health & Pharma @ Human Resources H Humanties & Social Sciences @ Industrial @ Leisure & Food @ Management @ Marketing @ Other @ Public Sector G Real Estate, Property & Construction G Science & Technology @ Tax, Law & Ac
Slide 7: Strategy – Profit by Format Mix
Strategy – Profit by Format Mix 7
Slide 8: Publishing – Academic Information
Publishing – Academic Information • 14% revenue growth 24% of • Renewal rates consistent at 98% All Profits • Annual subscription – year in advance • Online revenues increase by 25% • Reduced production costs 8
Slide 9: Publishing: Professional & Commercial Information
Publishing: Professional & Commercial Information • High renewal rates - 77% • Key titles growth in 2008 33% of All Profits • Datamonitor • 19% like for like profit growth • Geographic growth • Operating margin increase • ‘High value’ subscriber growth of 19% • Online data – ‘must have’ critical inf
Slide 10: Events & Training
Events & Training • Majority of events profit from Top 200 • Broad portfolio - diversified risk 43% of All Profits • Exhibitions remains an important sales channel • Large events – sponsors continue to see value • Flexible cost base allows for OP margin to be maintained for 2007 & 2008 • PI – high l
Slide 11: Financial Highlights
Financial Highlights • Revenue growth of 13% to £1.28bn • Adjusted operating profit growth of 17% to £305.8m • Organic profit growth of 1.4% (Profit growth adjusted for Datamonitor of 4%) • Adjusted diluted earnings per share up 14% to 40.3p • Free cash flow up 53% to £205.7m • Net debt to EBITDA re
Slide 12: Cash Flow
Cash Flow 2008 2007 £'m £'m Operating Profit 164.6 154.0 Amortisation/Depreciation 139.9 115.0 Working Capital 47.3 10.2 Operating Cash Flow 351.8 279.2 Interest (67.9) (79.9) Tax (39.2) (31.0) CAPEX (33.0) (33.9) Acquisitions/Disposals 11.8 (560.1) Dividends (73.9) (61.5) Share issues (0.7) 3.9 148
Slide 13: Cash Flow Visibility
Cash Flow Visibility • Academic Journals - 90% received almost a year ahead - 75% in US$ • Subscriptions - Mainly Annual - Renew regularly throughout the year • Exhibitions - Resell - 20%/40%/40% - Weighted to H1 and Middle East • Conferences - 50% within 4 Weeks - Little committed cost 13
Slide 14: Profit Build
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Slide 15: Profit Build
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Slide 16: Profit Build
Profit Build 100% + 80% 4 60% 4 40% 4 20% 4. 0% Bulysiiqnd 428430 sjeuinor 4eb syoog del informa
Slide 17: Profit Build
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Slide 18: Profit Build
Profit Build Other Publishing PI Government Top 200 Events T&F Books T&F Journals 100% + 80% 4 60% 40% 4 20% 0% 4 informa
Slide 19: Profit Build
Profit Build Rest of portfolio PI Government Top 200 Events Other Publishing T&F Books T&F Journals 100% 80% 60% 4 40% 20% 0% informa
Slide 20: Deferred income
Deferred income Deferred Income 31/12/08 31/12/07 Growth £ ’m £ ’m Publishing 203 160 27% Events 100 72 39% PI 6 5 20% 309 237 30% 20
Slide 21: Leverage
Leverage • Facilities in place to 2012 • Minimum headroom of £250m • Cash conversion 121% (110%) • Net debt to EBITDA reduced from 4.3 to 3.77 times • Net Debt to EBITDA covenant drops to 4 times @ June 2009 and 3.5 times thereafter • Target leverage ratio @ 31 Dec 09 of below 3 times 21
Slide 22: Outlook for 2009
Outlook for 2009 • In-line with expectations • Strong renewal rates & robust forward bookings • Publishing trading well • 6 largest events to date ahead of 2008 • Tougher outlook for smaller events & training • Benefits of weaker pound • Cost reduction programme ongoing • Headroom in place and right
Slide 23: Appendices
Appendices informa
Slide 24: Income Statement
Income Statement 2008 2007 Increase Organic £'m £'m % % Revenue 1278.0 1129.1 13% 1% Operating profit 164.6 154.0 Amortisation 123.8 99.3 Reorganisation costs 17.4 7.7 Adjusted Operating Profit 305.8 261.0 17% 1% Adjusted OP Margin 23.9% 23.1% Adjusted Interest (net) 72.4 58.4 Adjusted Tax 60.9 50.7
Slide 25: Revenue by Type
Revenue by Type 2008 2007 Increase Organic £m £m % % Events 441.6 408.8 8% -0.4% Advertising 38.8 35.8 8% 5.4% Copy Sales 187.7 154.3 22% 1.4% Subscriptions 380.5 304.9 25% 9.0% Publishing 607.0 495.0 23% 6.3% PI 229.4 225.3 2% -5.8% 1278.0 1129.1 13% 1.1% 25
Slide 26: Divisional Breakdown
Divisional Breakdown 2008 2007 Increase Organic £’m £’m % % Revenue Academic & Scientific 391.9 339.5 15% 5% Professional 426.3 393.3 8% -2% Commercial 459.8 396.3 16% 0% 1,278.0 1,129.1 13% 1% Adjusted Operating Profit Academic & Scientific 118.1 96.9 22% 6% Professional 96.4 83.9 15% 0% Commercial
Slide 27: Academic & Scientific
Academic & Scientific 2008 2007 Increase Organic £’m £’m % % Revenue Scientific, Technical & Medical 237.1 201.0 18% 6% Humanities & Social Sciences 154.8 138.5 12% 5% 391.9 339.5 15% 5% Adjusted Operating Profit Scientific, Technical & Medical 75.6 62.9 20% 7% Humanities & Social Sciences 42.5 34.0
Slide 28: Professional
Professional 2008 2007 Increase Organic £’m £’m % % Revenue Performance Improvement 229.4 225.3 2% -6% Financial Data Analysis 96.5 72.4 33% 7% Finance, Insurance, Law & Tax 100.4 95.6 5% 3% 426.3 393.3 8% -2% Adjusted Operating Profit Performance Improvement 39.1 35.3 11% -2% Financial Data Analysi
Slide 29: Commercial
Commercial 2008 2007 Increase Organic £’m £’m % % Revenue Regional Events 297.1 250.7 19% 2% Telecoms & Media 90.2 74.0 22% -5% Maritime & Commodities 72.5 71.6 1% -3% 459.8 396.3 16% 0% Adjusted Operating Profit Regional Events 54.2 46.5 17% -5% Telecoms & Media 25.3 23.2 9% -4% Maritime & Commodit
Slide 30: New Reporting Structure
New Reporting Structure Revenue 2008 2007 Growth Organic £’m £’m % % Academic Information 243.5 214.2 13.6% 7.2% Professional & Commercial Information 367.3 286.9 28.0% 5.4% Events & Training 667.2 628.0 6.3% -2.5% Total 1,278.0 1,129.1 13.2% 1.1% Adjusted OP 2008 2007 Growth Organic £’m £’m % % Aca
Slide 31: One off items
One off items Restructuring costs Redundancy £9.9m Restructuring £3.2m Property £3.6m Other £0.7m Total £17.4m Gains on disposal (Map of medicine) £16.7m 31
Slide 32: Bank Covenant
Bank Covenant 31-Dec-08 30-Jun-09 31-Dec-09 Net Debt to EBITDA 4.25 4 3.5 Interest Cover 3.75 4 4 • Split of debt 40% US$ 15% Euro 45% Sterling 32
Slide 33: Cost Structures
Cost Structures Events PI Publishing Central Total £ ’000s £ ’000s £ ’000s £ ’000s £ ’000s Fully Variable Promotion, venue, content, delivery, royalties and Commissions 165 85 210 - 460 Proft Sharing 20 10 10 - 40 185 95 220 0 500 Semi Variable Venue costs on large events 20 20 Staff related 95 70 1
Slide 34: Revenue by Currency
Revenue by Currency @ Sterling @ Euro BUSS 15% @ Other informa -))
Slide 35: Reconciliation of Tax Rate
Reconciliation of Tax Rate PBT Tax Effective tax Charge rate £m £m % PBT as reported 108.9 22.9 21.1 Adjusted for: 1. Restructuring Costs 17.4 5.4 31.0 2. Intangible asset amortisation 123.8 37.3 30.1 3. Profit on disposal of business (16.7) (4.7) 28.1 Adjusted PBT 233.4 60.9 26.1 35
Slide 36: Summary Balance Sheet
Summary Balance Sheet Balance Sheet 2008 2007 £'m £'m Intangibles and Goodwill 3,057.0 2,708.9 Fixed Assets 27.1 24.6 Investments and Other 39.4 36.3 Current Assets 327.4 280.0 Net Current Liabilities (661.6) (528.0) Debt (1,341.8) (1,244.9) Other Liabilities (374.5) (348.4) 1,073.0 928.5 36