EXTRA: Informa Upbeat On 2017 After Third Consecutive Year Of Growth

LONDON (Alliance News) - Informa PLC on Monday said its growth acceleration plan delivered the ...

Alliance News | 6 March, 2017 | 11:46AM

LONDON (Alliance News) - Informa PLC on Monday said its growth acceleration plan delivered the third consecutive year of growth in revenue, adjusted earnings, free cashflow and dividends as it reported its 2016 annual results.

Informa shares were up 0.8% on Monday at 679.00 pence per share.

The knowledge, event and information based business implemented the growth acceleration plan in 2014 with a "simple but demanding" goal of returning every single part of the business back to growth while also simultaneously building capabilities for the future.

Informa on Monday reported a rise in revenue in 2016 to GBP1.35 billion from GBP1.21 billion the year before, rising 11% year-on-year. Organic revenue growth was up 1.6% from the prior year, Informa said.

The Global Exhibitions division saw organic annual revenue rise by 8.7% and reported revenue grow by 17%, reflecting increased scale, international breadth and strengthened vertical market positions, Informa said.

Business Intelligence reported organic annual revenue growth of 1.1% and reported growth of 4.8% after Informa focused more on subscriptions and strengthening customer relationships while investing in products and platforms, it said.

The proportion of recurring and predictable revenue from subscriptions and exhibitions is expected to be more than 55% in 2017, Informa said.

Academic Publishing saw organic revenue rise by 1.1% in 2016, with reported growth of 9.6%. Informa said this was despite ongoing softness in the US book market, reflecting the strength of the Journals unit, Upper Level Academic focus, currency gains, and "strong returns" from acquisitions.

The fourth and final core unit, Knowledge & Networking, was the disappointment for the group, reporting an annual 4.1% decline in organic revenue thanks to ongoing volatility in the remaining domestic spot conference businesses while reported revenue was down 0.5%.

Informa said, following previous portfolio restructuring in other domestic conference businesses in Scandinavia, the Netherlands and Russia, the next stage of review of the Knowledge & Networking division is now underway. The units being reviewed are the conference businesses in Australia, Brazil, Germany, Singapore and Switzerland.

"Proactive repositioning towards higher growth and margin businesses will see Global Exhibitions and Academic Publishing accounting for circa 70% of group profit in 2017, with Business Intelligence around 20% and Knowledge & Networking less than 10%," said Informa.

Operating profit for the year amounted to GBP198.8 million, falling from GBP236.5 million in 2015. On an adjusted basis that excludes exceptional items, operating profit rose to GBP416.1 million from GBP365.6 million, with an adjusted operating margin of 30.9% versus 30.2%.

Operating cashflow in 2016 rose to GBP393.9 million from GBP377.7 million. Net debt stood at GBP1.48 billion at the end of the year, stepping up from GBP895.3 million a year earlier, solely due to the acquisition of Penton Information Services and the impact of currency on Informa's dollar-denominated debt.

Reported pretax profit in 2016 fell 18% to GBP178.3 million from GBP219.7 million. On an adjusted basis, pretax profit increased 11% to GBP376.5 million from GBP339.7 million.

Informa raised its dividend for 2016 to 19.3 pence from the 18.5 pence paid out in 2015, representing a 4.3% increase.

"2016 was a steady and strong year for the group, where the business grew on all key financial measures, whilst expanding significantly in the US and investing substantially in its products. This sets Informa up well for further progress in 2017," said Chief Executive Stephen Carter.

The continued delivery of the growth acceleration plan is a "priority" for this year, and Informa is aiming to generate GBP14.0 million of net synergies on annual basis in 2018, with "at least half" being realised in 2017.

The addition of Penton, acquired in November, will be a big feature in 2017, with the integration currently on track, and, combined with the growth acceleration plan, Informa said it expects to "deliver a fourth consecutive year of growth in revenue, profit, earnings and cashflow in 2017".

By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance

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