FY FY16 results presentation 24 November 2016 Andrew Rashbass, CEO - PowerPoint PPT Presentation

FY FY16 results presentation 24 November 2016 Andrew Rashbass, CEO

Co Context � Strategy on track � Performance in line with the Board’s expectations even though trading conditions tougher for some businesses than anticipated � Benefits from a strong dollar reinvested in the business to accelerate the strategy Page 2

Strategy on track Page 3

Strat St ategic journey B2 B2B B Media 1.0 B2B B2 B Media 2.0 B2 B2B B Media 3.0 Print Digital Embedded in workflow/platforms Stand-alone events Networking events Trading events/ memberships Monologue Dialogue Part of the customer industry Advertising central Subscriptions Licensing Product-centric Customer-centric Solution-centric Page 4

Eu Euro romoney is progr gressing well in its transformation to B2B Media 3.0: examples B2 B2B B Media 1.0 B2 B2B B Media 2.0 B2B B2 B Media 3.0 • Networking • Trading events • Content events conferences • Digital distribution • Magazine • Fleet valuation • Events • Newsletter • Counterparty risk • Magazine ratings • Awards Page 5

Eu Euro romoney is progr gressing well in its transformation to B2B Media 3.0: examples B2 B2B B Media 2.0 B2 B2B B Media 1.0 B2B B2 B Media 3.0 • Digital • Memberships • Magazine • Subscriptions • Capital introduction • Conferences platforms • Print publications • Digital distribution • Stock picking platform • Digital • Price reporting agency • Magazine • Subscriptions • Events Page 6

St Strat ategy: y: how we think k ab about the busi siness ss: four quad adran ants • Batten down the hatches + • Protect and enhance competitive position • New product development • Careful, selective investment for when the • Sales and marketing Prepare cycle turns Invest for upturn • Acquisition • Opportunistic on revenue opportunities • Fix any operational deficit • Tight cost control • Fix any operational deficit Cycle - + Structure • Modest investment to move to top-right quadrant above • Maximise shorter-term profit and cash Use the • Maximise shorter-term profit and cash • Divest Disinvest time wisely • Fix any operational deficit • Prevent future build-up • Consider divestment - Page 7

Y-ax axis of quad adran ants + Embedded in workflow/platforms, trading B2 B2B B Media 3.0 events/memberships, part of the customer’s industry, licensing, solution-centric Digital, networking events, dialogue, B2 B2B B Media 2.0 subscriptions, customer-centric Print, stand-alone events, monologue, B2 B2B B Media 1.0 advertising central, product-centric Structure - Page 8

Three pillars of strategy gy Invest around In Transfo form m Ac Actively big theme mes th the operating manage the ma mo model portfo folio Page 5

Them Themes: where where we we pl play Marke ket attributes Theme mes • Price discovery (eg metals, 1. Semi-opacity air finance) 2. • Asset management Inefficiency Challenged business • Counter-party risk (eg in 3. insurance) models 4. • Telecoms Disruption Page 10

In Invest around big themes: exa xamples � BCA, NDR, IIM/IIN � New product launches/bolt-on acquisitions (CEIC Flex, II Research All-America Trading Team Survey, AFJ Fleet Database) � Metal Bulletin PRA strategy � Telecoms growth strategy � Thought Leadership/Rival Advocacy � Acquisitions: MB FastMarkets, Reinsurance Security; pipeline filling with interesting opportunities Page 11

Operating g model Bu Business mo model Custome mers Ba Barriers to entry • Larger wallet than retail customers Scalable & cash generative • Strong brands • Relatively price inelastic Low Create once, Recurring Pricing • Long-standing relationships between capital sell many revenues power intensity buyers & sellers • Sophisticated & knowledgeable • Network effects − Understand the value of the service in order to remain competitive or • Developed infrastructure, difficult to compliant High operating replicate High margin leverage • Repeat customers − Depend on product or service • Often similar across geographies Strong, sustained earnings and − Information needs not dissimilar cash generation Page 12

Transform the operating g model: examples � Price optimisation: BCA, NDR, Metal Bulletin, trading events � Faster product development � New marketing approach � Streamlining of divisions/management structure � Realignment of incentives with strategic objectives � Global HR and GC appointments � Investment in China team � Increased investment in technology leadership and development teams Page 13

Ac Actively manage the portfolio: examples Bu Buy � Acquisitions of FastMarkets and Reinsurance Security � Strong acquisition pipeline especially Telecoms � Balance sheet provides significant acquisition firepower Se Sell/ ll/restructure � Sale of Gulf Publishing/Petroleum Economist � Sale of II Searches � Restructuring of Euromoney Learning Solutions Page 14

FY FY16 results presentation 24 November 2016 Colin Jones, Finance Director

Results snapshot 1 Re £m FY15 FY FY16 Change Revenue 403.4 403. 403.1 0% Adjusted PBT 1 107.8 102. 102.5 (5%) Statutory PBT 1 123.3 43. 43.9 (64%) Adjusted EPS 1 70.1p 66. 66.5p 5p (5%) Dividend 23.4p 23. 23.4p 4p = Net cash 17.7 83. 83.8 +£66.1m 1. As reconciled in appendix to Preliminary Statement Page 16

Key message ges � Reported revenue unchanged at £403m, largely due to favourable US$ � Underlying 1 revenue down 4%, largely due to disinvest quadrant – strategy addressing this � Operating margin down due to disinvest quadrant, as well as investment � Strategy already driving improvement in subscription revenue growth rate � Favourable US$ has allowed accelerated investment in strategy � Strong operating cash flows and balance sheet firepower � Dividend maintained despite earnings decline 1. Excludes acquisitions/disposals, timing differences and at constant exchange rates Page 17

Sta tatuto tutory y profi fit 102. 102.5 16. 16.7 7 37.3 37. 3 4. 4.4 4 0. 0.2 2 43.9 43. Adjusted P PBT Acquired i intangible Ex Exceptional Share o of a f associates Other Ot er Statutory P PBT a amo mortisation items i ms a amo mortisation Page 18

Ex Excep eptional item ems £m FY15 FY FY16 Profit on disposal of assets 55.1 7. 7.1 Goodwill and intangibles impairment (18.5) (2 (28.7) Tax provision - (7 (7.9) Restructuring and other (3.2) (7.8) (7 33.4 (3 (37.3) 1. See note 3 of the Preliminary Statement for fuller description Page 19

Cash flow, balance Ca ce sheet and key financi cial measures � Underlying tax rate 18% consistent with 2015 1 � Underlying deferred subscription revenue up 3% 1 � Balance sheet strength: – Net cash £83.8m at September 30 – Underlying cash conversion 105% (2015: 104%) 1 – Final (and full-year) dividend maintained (16.4p/23.4p) – actual cover 2.8x 1. See appendix for further details Page 20

Strong g cash flows in FY16 83.8 83. 108. 108.8 FY FY16 oper operating cash h con onversion 105% ment (£m) Cash Moveme 11.2 11. 29.9 29. 17. 17.7 5.6 5. 16.7 16. 3.3 3. 3. 3.7 1.3 1. Net c cash a at Ca Capex M& M&A Di Divid idends FX/Othe FX her Net t tax Ex Exceptional Worki king Operating c cash Net c cash a at Sept 3 30 2 2015 items ms ca capital infl flow Sept 3 30 2 2016 Page 21

Opera perating res results £m FY15 FY FY16 Change Revenue 403.4 403.1 403. 0% Adjusted operating profit 1 104.2 101. 101.4 (3%) Adjusted operating margin 25.8% 25. 25.2% 2% (0.6%) Adjusted PBT 1 107.8 102.5 102. (5%) 1. As reconciled in appendix to Preliminary Statement Page 22

FY FY16 reported revenue: : drag from om disinvest quadrant of offset by favou ourable FX FX 18. 18.1 1 4. 4.6 6 16.8 16. 8 2.7 2. 7 5.7 5. 7 403. 403.4 403.1 403. FY FY15 FX FX Net M M&A Di Disin invest Invest In Other Ot er FY16 FY Page 23

nderlying 1 re Und revenue change Y-o-Y % change FY15 FY16 FY16 H1 H2 H1 H2 Full Year Subscriptions and content 2% 3% 1% 2% 1% Advertising (12%) (9%) (9%) (13%) (11%) Sponsorship 7% (6%) (8%) 1% (2%) Delegates 3% (12%) (18%) (10%) (14%) [Delegates (excl training)] [(1%)] [(10%)] [(13%)] [(2%)] [(8%)] Total 2 1% -5% -6% -2% -4% 1. Excludes acquisitions/disposals, timing differences and at constant exchange rates Page 24 2. After closed/sold businesses, FX and other revenues

Re Repor orted revenue ch change ge Y-o-Y % change FY15 FY16 FY16 H1 H2 H1 H2 Full Year Subscriptions and 5% 9% 5% 11% 8% content Advertising (8%) (4%) (3%) (6%) (5%) Sponsorship 11% (1%) (3%) 10% 4% Delegates 8% (9%) (5%) (5%) (5%) Total 1 1% (2%) (2%) 2% 0% 1. After closed/sold businesses, FX and other revenues Page 25