Hyve — FY2020 Earnings Presentation
46 slides from Hyve's earnings presentation, Dec 1, 2020
Slide 1: Preliminary Results, Year ended 30 September 2020
Hyve Group plc Preliminary Results Year ended 30 September 2020 1 December 2020
Slide 2: Mark Shashoua CEO
Mark Shashoua CEO Preliminary results: year ended 30 September 2020 / 2
Slide 3: Agenda
Agenda › Introduction and business overview Mark Shashoua › Financial overview John Gulliver › Conclusion Mark Shashoua › Q&A Mark Shashoua & John Gulliver Preliminary results: year ended 30 September 2020 / 3
Slide 4: FY20 Headlines
FY20 Headlines › Strong start to year: 7% like-for-like revenue growth in Q1 with strong double-digit growth in Mining Indaba, Africa Oil Week and Yugagro in H1 › Took immediate action in response to COVID-19 to reduce costs, conserve cash and increase liquidity › Continue to run events safely where
Slide 5: Immediate action taken to reduce costs and conserve cash
Project Fortress Immediate action taken to reduce costs and conserve cash… › Cost reduction programme announced in May with additional restructuring measures in September › Headcount reduction of 30%, including contractors › Positive ongoing dialogue with venues and suppliers › Savings of £63m deliv
Slide 6: …as well as strengthen the balance sheet
Project Fortress …as well as strengthen the balance sheet › Rights issue in May 2020 raised £126.6m fully taken up by shareholders › £250m debt facility provides additional liquidity › Covenant waivers up to and including March 2022 › Temporary suspension of dividend › Insurance proceeds of £47m for
Slide 7: Postponement and cancellation update FY20
Project Fortress Postponement and cancellation update FY20 No. of events Key events Held in FY20 57 Cancelled in FY20 67 Postponed to FY21 3 Preliminary results: year ended 30 September 2020 / 7
Slide 8: Supporting our customers in person: WorldFood Moscow
Project Fortress Supporting our customers in person: WorldFood Moscow › One of first shows in Russia after restrictions lifted › 337 exhibitors with 12,799 unique visitors › 1022 onsite content program participants, 656 online participants › Rebookings up 27% for FY21 › Customer feedback: o “There w
Slide 9: Strong safety measures give customers confidence
Project Fortress Strong safety measures give customers confidence › Created global taskforce to ensure safety of customers, colleagues and communities in which we operate › Developed new COVID-19 safety standards that adhere to government, venue and industry specific requirements › Our Safe & Secure
Slide 10: Scenario planning for FY21
Project for Building Fortress the future Scenario planning for FY21 Recovery East/West scenario scenario › Events run all year in China, › Events run all year in China, Russia, Ukraine and Turkey Russia, Ukraine and Turkey › Events in the west › No events run in the west to run from H2 for the entir
Slide 11: Positioning the business for success post pandemic
Building for the future Positioning the business for success post pandemic Three key requirements: › Strong balance sheet to trade through until markets reopen › Portfolio of market leading events capable of delivering maximum return on investment › Clear vision for the future Preliminary results: y
Slide 12: Hyve has a strong portfolio of market-leading events
Building for the future Hyve has a strong portfolio of market-leading events Manage the portfolio May 2017 FY19 Pro forma No. of events 269 100 63% 100 Revenue £134m2 £210m3 57% Revenue per event £0.5m £2.1m 320% 269 FY17 Revenue FY19 Pro forma Revenue3 Product-led events acquisitions Global 86 Bran
Slide 13: Creating an omnichannel business – in person and online
Building for the future Creating an omnichannel business – in person and online Fundamental Trade Network Learn customer needs Omnichannel strategy Continue providing access to In person Introduce hosted meetings to facilitate trade on site. market-leading content and Customer ROI and ROT materially
Slide 14: Evolving in-person events - facilitated hosted meetings
Building for the future Evolving in-person events - facilitated hosted meetings › Shoptalk has developed an industry-leading hosted meetings offering, underpinned by highly automated technology › In 2019, 8,000 meetings took place as 450 sponsors met with 1,500 individuals from 500 retailers › Hyve
Slide 15: Hyve
Hyve
Slide 16: Research confirms strong demand for in-person hosted meetings
Building for the future Research confirms strong demand for in-person hosted meetings “If hosted meetings were available would you use them?” Spring/Autumn Fair Spring/Autumn Fair Bett Bett MosBuild Visitor Exhibitor Visitor Exhibitor Visitor 18% 20% 25% 46% 42% 54% 58% 82% 80% 75% Yes No Hosted is
Slide 17: Evolving our offering online
Building for the future Evolving our offering online › Delivered approximately 100 webinars in FY20 attracting more than 30,000 attendees › Wide range of formats including presentations, round tables, product showcases and multi-day conferences › Most online offerings across the industry focus on le
Slide 18: Preparing for market recovery
Building for the future Preparing for market recovery Building Trialling customer market hosted meetings Assessing share on our across key in- “proof of concept” market-leading person events for for online events events roll-out in FY22 Preliminary results: year ended 30 September 2020 / 18
Slide 19: Preliminary results, John Gulliver CFOO
Preliminary results John Gulliver CFOO Preliminary results: year ended 30 September 2020 / 19
Slide 20: FY20 financial headlines
Preliminary results FY20 financial headlines FY20 FY19 Revenue £105.1m £220.7m LFL1 decline of 11% impacted by COVID-19 in H2 Material cost savings achieved in H2; £11m cost incurred on Operating costs2 £146.9m £173.1m cancelled FY21 events Cancellation insurance cover; additional £13.1m received In
Slide 21: FY20 event schedule significantly impacted by COVID-19
Preliminary results FY20 event schedule significantly impacted by COVID-19 Revenue Q1 Q2 Q3 Q4 Total FY19 FY20 £221m £105m £76m £59m £70m £8m £32m £37m £1m £43m Number of events FY19 351 27 45 22 129 FY20 30 15 - 12 57 Top 10 events2 FY19 1 4 2 3 10 FY20 1 3 - 1 5 1 Includes four events subsequently
Slide 22: Revenue bridge
Preliminary results Revenue bridge 129 events -63 events -2 events -4 events -3 events 57 events £0.9m (£12.8m) £m Azerbaijan (1.4) £m (£101.3m) Uzbekistan (0.6) TRY (0.3) BVE (UK) (1.2) CNY (0.3) Other (0.1) £220.7m £3.4m (£3.2m) (£1.9m) (£0.7m) £114.1m COVID-19 impact No Shoptalk revenue due £105.
Slide 23: Financial security through the crisis
Preliminary results Financial security through the crisis Successful Rights Issue Renegotiated debt facility Strengthened liquidity Facility Stronger INCREASED than anticipated to £250m year end net Raised £126.6m Maturity debt of £68m EXTENDED in May 2020 fully to Dec 2023 supported by Repayments s
Slide 24: Adjusted net debt bridge
Preliminary results Adjusted net debt bridge Dec 2019 Acquisitions FY19 Final May 2020 Cash Flow Sep 2019 Share Placement & Disposals Dividend Rights Issue1 from Operations Insurance Interest & Tax Capex Net Other Sep 2020 (£67.7m) (£10.1m) (£1.9m) (£8.4m) (£111.7m) £22.0m (£14.2m) £50.0m Net cash p
Slide 25: Immediate action taken to reduce costs through Project Fortress
Preliminary results Immediate action taken to reduce costs through Project Fortress FY20 Annualised savings In-year In-year savings for FY21 from cost savings represent actions 30% £44m £63m of FY19 costs1 Saved Avoided Venue space commitments Costs Costs Capex Venue space rental & services Redundan
Slide 26: Cash flow supported by insurance claims
Preliminary results Cash flow supported by insurance claims £15m Potential receipts £22m Received in FY20 £12m £50m Claims Claims dependant on confirmed in FY21 £13m FY21 event cancellations Potential receipts Received in FY21 FY20 policy: £62m1 FY21 policy: £50m 1 Consists of two policies for £25m
Slide 27: Outlook for Hyve events in FY21
Preliminary results Outlook for Hyve events in FY21 Recovery scenario H1 H2 Total Total 17 48 65 events Top 10 - 5 5 events East/West scenario H1 H2 Total Total 15 38 53 events Top 10 - 2 2 events Preliminary results: Preliminary results: year year ended ended 30 30 September September 2020 2020 / 2
Slide 28: Rebased portfolio expected to resume for FY22
Preliminary Project Fortress results Rebased portfolio expected to resume for FY22 › We expect full schedule of events to run in FY19 FY19 FY22 Reported Rebased Revenue: Revenue: £221m £210m › There have been a number of portfolio changes since FY19 creating a new starting point for FY22 revenues Re
Slide 29: Cost base managed in line with our trading scenarios
Preliminary results Cost base managed in line with our trading scenarios Cost reductions - FY21 Recovery Cost reductions - FY21 East/West East -16% East -16% West -30% West -34% East -27% Direct staff costs East -27% West -51% West -72% Event running costs Indirect costs -12% -14% FY19 FY21 FY19 FY2
Slide 30: Monthly average cash cost substantially reduced
Preliminary results Monthly average cash cost substantially reduced FY19 pro forma1 FY21 FY20 FY21 Recovery East/West Operational cash cost2 £16m £12m £11m £10m Total cash cost3 £18m £13m £13m £12m Net cash burn4 £4m £5m 1 After adjusting for acquisitions and disposals, principally the Shoptalk acqu
Slide 31: Modelled scenarios show strong liquidity throughout FY21
Preliminary results Modelled scenarios show strong liquidity throughout FY21 Cash and undrawn debt facility £250m Recovery scenario East/West scenario Recovery £200m Liquidity covenant1 scenario Modelled FY21 net debt c.£100m £150m £100m Headroom c.£80m - £100m East/West £50m scenario Modelled FY21
Slide 32: Well-placed to weather the storm
Preliminary results Well-placed to weather the storm Significant Ongoing Flexible cash runway focus on cash operational providing good and cost approach visibility of management liquidity Preliminary Preliminary results: results: year year ended ended 30 30 September September 2020 2020 // 32 32
Slide 33: Mark Shashoua CEO
Mark Shashoua CEO Preliminary results: year ended 30 September 2020 / 33
Slide 34: Conclusion
Conclusion › Taken every measure to protect the business › Continue to believe demand for in-person events will return › Market-leading events will have a competitive advantage when markets reopen › Strategy and transformation programme position us well for a post COVID-19 environment › Now actively
Slide 35: Q&A
Q&A Mark Shashoua & John Gulliver Preliminary results: year ended 30 September 2020 / 35
Slide 36: Appendices
Appendices Preliminary results: year ended 30 September 2020 / 36
Slide 37: Consolidated income statement
Appendices Consolidated income statement Headline Results FY20 FY19 £m £m Revenue 105.1 220.7 Gross Profit 1.3 87.4 Gross Profit Margin 1% 40% Admin Expenses/Operating Income (42.5) (38.8) Insurance Proceeds 22.0 - FX 2.8 (1.1) Profit from Associates 5.7 8.3 Operating (Loss)/Profit (10.7) 55.8 Opera
Slide 38: Divisional analysis
Appendices Divisional analysis FY20 FY19 Revenue HPBT Revenue HPBT £m £m £m £m › Strong H1 growth offset by event cancellations Global Brands 31.8 1.3 49.7 20.3 › Includes Shoptalk acquisition – no revenue due to cancellation but costs incurred Asia 17.1 7.3 23.2 9.4 › Impact of biennials offset by
Slide 39: Performance analysis
Appendices Performance analysis Headline Profit Metres Revenue Before Tax 000s £m £m Results from events 783 220.7 50.4 Biennial (12) (2.5) (1.8) Timing - 0.2 (0.3) FY19 COVID-19 postponements and cancellations (342) (101.3) (47.4) Non-recurring (8) (2.1) (0.3) Disposals (8) (3.2) (0.5) Recurring ev
Slide 40: Adjusting items
Appendices Adjusting items FY20 FY19 £m £m Amortisation of acquired intangible assets Non-cash (29.2) (24.1) Impairment of assets Non-cash (263.0) - Gain/(loss) on disposal Non-cash 2.3 (3.2) Operating items Transaction costs Cash (3.3) (1.4) Integration costs and costs of realising synergies Cash (
Slide 41: Consolidated balance sheet
Appendices Consolidated balance sheet FY20 FY19 £m £m Goodwill and intangible assets 307.4 480.6 Non-current assets Other non-current assets 63.8 52.8 371.2 533.4 Trade debtors 14.3 36.0 Prepayments 9.9 17.5 Current assets Other current assets 10.9 8.8 (112.2) 35.1 62.3 (60.9) Net debt (67.7) (111.7
Slide 42: Cash generated from operations
Appendices Cash generated from operations FY20 FY19 £m £m Statutory operating (loss)/profit (306.7) 14.2 Adjustments 298.0 29.4 Operating cash flows before movements in working capital (8.7) 43.6 Working capital movements 16.5 (3.2) Cash generated from operations 7.8 40.4 FY20 FY19 £m £m Cash genera
Slide 43: Shareholder structure as at 31 October 2020
Appendices Shareholder structure as at 31 October 2020 Country of Shareholder % of Total Shares No. of Shares (millions) RWC Partners UK 12.7 33.7 Amiral Gestion France 6.2 16.5 BlackRock UK 6.1 16.1 Bank of America Merrill Lynch International collateral account1 UK 5.4 14.3 JO Hambro Capital Manage
Slide 44: Top events
Appendices Top 10 events Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Preliminary results: year ended 30 September 2020 / 44
Slide 45: Cost analysis
Appendices Cost analysis Total cost base Cost base by flexibility Cost base by type 20% 30% 25% overheads variable costs fixed costs 40% 35% other costs staff 80% cost of running 45% events semi- variable costs1 25% venue 1 Semi-variable costs include costs that over time could be flexed to changes
Slide 46: Life cycle of a Hyve event during COVID-19
Appendices Life cycle of a Hyve event during COVID-19 Boris Johnson announces further restrictions for 6 months COVID-19 hits Team start global economy selling on 2021 Bett 2021 cancelled Jan 2020 Oct 2020 Jan 2021 Jan 2022 Bett runs in Jan 2020; Costs reduced Sales for the 2022 2022 safe and secure