Organic revenues declined 14 per cent in 2009 at events and publishing group Informa, but there was continued resilience in its publishing division - which generates 72 per cent of profits. Moreover, although management says that the outlook remains uncertain, 2010 is already looking better than 2009, with booked and deferred income ahead of last year's outcome.
Informa's publishing business managed to register organic revenue growth of 2 per cent over the year, thanks to a particularly strong performance in its academic information unit. Encouragingly, 72 per cent of publishing revenues are now generated from digital sources. Additionally, 64 per cent of the division's revenues come from subscription-based sales, with advertising accounting for just 3 per cent of sales.
That has helped offset a 27 per cent organic sales decline from the events and training business, which generates 46 per cent of group revenues. In fact, Informa had to cancel a number of events in the period, which resulted in £108.8m of lost revenue. However, the group says that large conferences and exhibitions, such as the Monaco Yacht Show, were still resilient. Furthermore, chief executive Peter Rigby believes that 2009's fourth quarter demonstrated a "degree of stability" - this has continued into 2010, with forward bookings for the current year marginally ahead of last year.
Meanwhile the group's two-for-five rights issue in May raised £242.5m, which helped cut net debt to £872.6m from £1.3bn previously. That meant a much-reduced finance charge which, combined with £40m of annualised cost savings generated during the year, allowed Informa to report a small 1.2 per cent increase in adjusted operating profit to £310m. Indeed, after having spent much of the year rationalising its operations, Informa hasn't ruled out further structural changes. Chairman Derek Mapp says Informa will continue to make small bolt-on acquisitions while also seeking to divest businesses that do not fit with its long-term strategy.
Altium Securities expects pre-tax profits of £248m for 2010, giving EPS of 31p (£96.5m and 18.8p in 2009).
INFORMA (INF) | ||||
|---|---|---|---|---|
| ORD PRICE: | 349p | MARKET VALUE: | £2.1bn | |
| TOUCH: | 348-349p | 12-MONTH HIGH: | 368p | LOW: 164p |
| DIVIDEND YIELD: | 3.3% | PE RATIO: | 19 | |
| NET ASSET VALUE: | 222p* | NET DEBT: | 66% | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p)** | Dividend per share (p)** |
|---|---|---|---|---|
| 2005 | 0.73 | 61.0 | 2.33 | 7.35 |
| 2006 | 1.04 | 86.5 | 13.50 | 10.30 |
| 2007 | 1.13 | 124.0 | 23.40 | 14.30 |
| 2008 | 1.28 | 109.0 | 16.80 | 8.41 |
| 2009 | 1.22 | 96.5 | 18.80 | 11.50 |
| % change | -5 | -11 | +12 | +36 |
Ex-div: 14 Apr Payment: 19 May *Includes intangible assets of £2.8bn, or 468p a share **Restated for May 2009's right issue | ||||
