Portfolio pruning is a major trend in the events and publishing sector as companies bend to fit the demands of an increasingly digital world. Informa’s (INF) strategic overhaul may have “taken us some time”, according to chief executive Stephen Carter, but it is finally coming good. The company is now over 50 per cent bigger in revenue terms than when the strategic plan was initiated three years ago. Acquisitions including Virgo Publishing, Hanley Wood Exhibitions and Penton Information Services were a major contributor to the 41 per cent jump in half-year adjusted operating profit to £285m in the first half.
The standout division was, once again, exhibitions, where like-for-like revenues and operating profits were both up 11 per cent. Margins here were knocked slightly to 42 per cent due to investment in new digital platforms and integration, although the division still accounts for just over half of group adjusted profits.
Both the academic publishing and business intelligence divisions returned to underlying growth after a stumble in 2016 with reported numbers ahead of broker expectations. However, Numis is cautious about upgrading forecasts for the year to December 2017. Informa has disposed of its stake in its profitable conferencing business Euroform and there is the potential for currency headwinds in the second half. The broker expects pre-tax profit of £504m for the full year, giving EPS of 47.8p (from £377m and 42.1p in 2016).
| INFORMA (INF) | ||||
| ORD PRICE: | 719p | MARKET VALUE: | £5.92bn | |
| TOUCH: | 719-719.5p | 12-MONTH HIGH: | 725p | LOW: 625p |
| DIVIDEND YIELD: | 2.7% | PE RATIO: | 29 | |
| NET ASSET VALUE: | 259p* | NET DEBT: | 73% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 648 | 98.9 | 12.7 | 6.3 |
| 2017 | 915 | 149 | 14.1 | 6.7 |
| % change | +41 | +50 | +11 | +6 |
| Ex-div: | 10 Aug | |||
| Payment: | 15 Sep | |||
| *Includes intangible assets of £4.4bn, or 537p a share | ||||
