Informa announces half-year results

Informa, the international academic markets, B2B markets and digital services group, has released its full statutory results for the six months to 30 June 2022 and announced the divestment of Maritime Intelligence for £385m ($458m). This follows the market update published on 19 July 2022 by the publisher, which included pre-released headline figures for the half-year and reaffirmed full year expectations.

The publisher reported as follows:

Stephen A. Carter, group chief executive, Informa PLC, said: ”As outlined in our recent Market Update, Informa’s first half results underline the benefits of our GAP II strategy, with strong growth in revenues, profits and cash. We remain on track to achieve the upper-end of 2022 guidance, with good forward visibility in Subscriptions, Exhibitors, Delegates and Digital Services, whilst continuing to deliver accelerated shareholder returns, additional growth investment and further targeted expansion.”

H1 2022 Financial Highlights (Continuing and Discontinued)

• Guidance reconfirmed: Full year expectations reaffirmed at the top-end of guidance, with growth in revenue, adjusted operating profit and earnings per share expected to be above historical trends;
• Strong Revenue Growth: Total H1 revenue growth of 59.1% and underlying growth1 of 43.9%, delivering Group revenues of £1,096.3m (2021: £688.9m), reflecting strength in Academic Markets, growth in B2B Digital Services and the continuing return of Live and On-Demand B2B Events;
• Strong Adjusted Profit Growth: Adjusted Operating Profit1 increased by 226.6% to £234.5m (2021:£71.8m), reflecting strong revenue growth and effective cost management;
• Improving Statutory Performance: Higher revenues, lower COVID exceptional costs and increased profit on divestment delivers statutory operating profit of £90.9m (H1 2021: £55.4m loss);
• Higher Free Cash Flow: Strong adjusted operating profit growth and 100%+ operating cash conversion delivers free cash flow of £178.4m, up from £134.1m in H1 2021, including a doubling of capital reinvestment into digital services and enhanced technology capabilities;
• Balance Sheet Strength: Free Cash Flow growth combined with strong divestment returns, delivers positive net cash position, compared to net debt of £1.9bn a year ago, providing balance sheet strength and flexibility for shareholder returns, reinvestment and expansion;
• Dividends Resumed: The strength of the balance sheet, confidence in forward cash flow growth and the success of GAP II Portfolio Focus, lead to a resumption of ordinary dividends at 3p per share for H1 (with a target payout ratio of c.40% of full year adjusted earnings).

H1 2022 Divisional Highlights (Continuing and Discontinued)

• Improving growth at Academic Markets: Robust Subscription renewals and good growth in eBooks and Advanced Learning, combined with continuing growth in Pay to Publish services such as Open Research and F1000, delivers further improvement in underlying revenue growth to 3%; GAP II investment for future growth through further expansion in Open Research, reflected in lower year-on-year operating margin, as expected;
• Strong growth in Live and On-Demand B2B Events: 220+ Live Events delivered in the first half, attracting 28k+ Exhibitors, 1.1m+ Attendees and more than £450m of revenue, representing 80%+ of equivalent revenue in 2019. Live Events outperformance in markets that are fully open, combined with B2B Digital Services growth, is balancing progressive reopening in Mainland China;
• Double-digit growth in B2B Digital Services: Strong performances in specialist Content Marketing and Lead Generation, combined with positive annualised contract values at Omdia subscription research delivered more than 10% underlying revenue growth in B2B Digital Services;
• Robust growth in Informa Intelligence: Robust underlying revenue growth in Intelligence portfolio (+4.1% Continuing and Discontinued) ahead of divestment, underpinning attractive valuations and positive forward prospects under new ownership.

GAP II: Growth, Expansion and Balance Sheet Strength

• GAP II is creating a more focused, higher growth business, with leading positions in Academic Markets and Live and On-Demand B2B Events, and a growing range of high value B2B Digital Services.
• Portfolio Focus completed: Divestment of Maritime Intelligence to Montagu at a valuation of £385m, receiving cash proceeds (subject to finalisation of working capital and capital structure), whilst retaining a 20% equity interest; this follows the sale of Pharma Intelligence (£1.9bn) and EPFR (£162m) and completes GAP II Portfolio Focus; c.£2.5bn (c.$3bn) of total value realised at a blended 2021 EV/EBITDA multiple of c.28x, significantly strengthening the balance sheet and providing funds for shareholder returns, reinvestment and expansion;
• Investment for Growth: GAP II investment programme progressing to plan, with initial projects focused on the continuing roll-out of IIRIS across our B2B portfolio, the strengthening of Open Research platforms and enhancing the quality and range of smart event services. Expected GAP II capital expenditure of £30-40m in 2022, and net operating investment of up to £30m;
• B2B Data and Analytics Engine, IIRIS: Continuing momentum in proprietary B2B customer data and analytics platform, IIRIS, with first party Known Engaged Marketable Audience (KEMA) increasing from 10m reported in March to 12m+ as platform adoption accelerates across portfolio of B2B brands;
• B2B Digital Services Expansion: Acquisition of Industry Dive (Specialist Content / Audience Development) alongside IIRIS (First Party Data) and NetLine (Content Syndication / Lead Generation), further expands Informa’s B2B Digital Service offering. Combination with portfolio of B2B brands expands KEMA, enhances B2B Audience Development across 25+ targeted B2B markets and accelerates the roll out of targeted Lead Generation services;
• Market and Geographic Expansion: Recent announced extension of partnership in the growing Beauty & Personal Care market today further expanded into the US, joining forces with the Professional Beauty Association and BolognaFiere to bring a number of established and new Beauty brands into the country;
• Accelerating Shareholder Returns: Free cashflow strength combined with strong divestment returns has seen share buyback programme expanded from initial £100m to £725m. To date, 60m shares acquired at an average share price of 572p, delivering £346m capital returns to shareholders; In addition, ordinary dividends resumed at c.40% of full year adjusted earnings;
• FasterForward on ESG: Continuing delivery of Group-wide sustainability programme, FasterForward, including first certified CarbonNeutral Event (IM Power), recertified CarbonNeutral Publications (Taylor & Francis), and 90%+ of electricity at our events powered by renewable sources; strong progress continues to be recognised by external indices, including A- in CDP and leading peer group sector ranking within the Dow Jones Sustainability Index.

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