The spectre of the financial crisis has left investment banks wary of expanding their marketing budgets or stumping up for business intelligence - bad news for financial information and events group Euromoney Institutional Investor (ERM). Investment bankers are cutting back on advertising in its eponymous publications and spending less on its data products, causing a 7 per cent fall in adjusted operating profits to below £51m for the six months to March.
Euromoney's underlying advertising revenues slumped 11 per cent. That was partly offset by healthy demand from asset managers for data and subscription products, and increased sponsorship of Euromoney's larger telecoms and specialist finance conferences. The company's strong cash generation also helped it slash net debt by almost three-quarters in six months, to £10.6m. It now has an "embarrassingly strong" balance sheet, says finance chief Colin Jones. He hopes to rectify the situation by making quality acquisitions this year.
Operationally, the group accelerated the roll-out of its Delphi content platform, which adds new features and lets it bring products to market faster. BCA Research is already benefiting from Delphi-enabled interactive charting and online research tools. Euromoney is also gearing up to launch new intelligence databases for telecom and hedge fund customers, as well as data products focused on China and South East Asia.
Broker Numis expects full-year pre-tax profits of £116m, giving EPS of 69.8p (from £116m and 70.6p in 2014).
| EUROMONEY INSTITUTIONAL INVESTOR (ERM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,250p | MARKET VALUE: | £1.6bn | |
| TOUCH: | 1,210-1,239p | 12-MONTH HIGH: | 1,281p | LOW: 951p |
| DIVIDEND YIELD: | 1.8% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 332p* | NET DEBT: | 2% | |
| Half-year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 196 | 42.8 | 25.2 | 7.0 |
| 2015 | 198 | 93.3 | 63.5 | 7.0 |
| % change | +1 | +118 | +152 | - |
Ex-div: 21 May Payment: 18 Jun *Includes intangible assets of £558m, or 435p a share | ||||
