The next three months could be make or break time for business publisher Euromoney. The company, majority-owned by Daily Mail, has set itself the challenge of returning to revenue growth in the third quarter. In the first half, the company reported 6 per cent lower underlying revenues but managed to grow adjusted pre-tax profits a third to a record £40m, reflecting tight cost control and margin improvement.
The turn is already happening in parts of the business. Second quarter income from delegates attending conferences and seminars rose 23 per cent following a 33 per cent drop in the first quarter which helped group second quarter revenues turn positive. Sponsorship revenues were down 18 per cent over the half, but actually rose strongly in the second quarter and the rate of decline is slowing in advertising and events.
The company plans to invest £4m into new businesses in the second half and this could limit how big a dent it can make into reducing net borrowings of £178m, up from £165m. However, Euromoney says it is past its peak debt period and cashflow is seasonally stronger in the second half.
Broker Altium has raised pre-tax forecasts by 5 per cent for the full year to £75m, implying adjusted EPS of 46.5p (2090: £60.3m/40.4p).
Euromoney (ERM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 560p | MARKET VALUE: | £656m | |
| TOUCH: | 556-562.5p | 12-MONTH HIGH: | 560p | 191p |
| DIVIDEND YIELD: | 2.5% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 119p* | NET DEBT: | 128% | |
| Half-year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Net div per share (p) |
|---|---|---|---|---|
| 2009 | 161 | -41.8 | -19.8 | 6.25 |
| 2010 | 148 | 32.7 | 23.2 | 6.25 |
| % change | -8 | - | - | - |
Ex-div:19 May Payment:15 Jul * Includes intangible assets of £434m, or 371p per share | ||||
