FY18 Full-year results presentation Andrew Rashbass and Wendy Pallot - PowerPoint PPT Presentation

FY18 Full-year results presentation Andrew Rashbass and Wendy Pallot 22 November 2018

2 Headlines Encouraging overall performance – a year of growth ■ Strong underlying profit growth in Pricing, Data & Market Intelligence 18% ■ Good underlying revenue growth from events across all segments 7% ■ Actions taken in Asset Management to mitigate headwinds July/August 2018 ■ Active portfolio management 1 £257m ■ Continuation of strong underlying cash conversion 102% ■ Healthy net cash – enhanced by disposals ■ £78.3m 1. Sum of acquisition and disposal consideration in 2018

3 We are a global information business providing essential B2B information to global and specialist markets We provide pricing discovery, market intelligence and events across our segments

4 Group at a glance Revenue by type 2018 1 Revenue by currency 2018 2 Underlying revenue growth % 3% (1%) Subscriptions Advertising Events Other USD GBP EUR Other 56% 68% (4%) 2016 2017 2018 of revenues are subscription of revenues are in dollars £414.1m 2018 total revenue £109.2 2018 adjusted PBT £78.3m cash at 30/9/18 27% >100% 1,655 employees worldwide average adjusted operating underlying cash conversion 3 profit margin over last 5 years over last 5 years Underlying revenue, excluding closed/sold businesses and FX gains on forward contracts 1. Currency split based on 2018 total revenue 2. Underlying cash conversion adjusted for timing differences and exceptional items 3.

5 What we do Asset Pricing, Data & Banking Commodity Management Market Intelligence & Finance Events Global asset Commodity markets, telecoms, Global banking Various Markets management industry insurance, aviation, industry (Soft commodities, metals, served infrastructure, derivatives, legal minerals, mining) Revenue 1 (£m) £151m £144.7m £70.7m £20.8m (% group) 39% 37% 18% 6% Revenue (by type) Subscriptions & content Advertising Events Other Revenues above are from continuing operations, excluding closed/sold businesses and FX gains on forward contracts (see page 39) 1.

6 Full-Year Results

7 Full-year summary Underlying 2 % 2018 2017 Adjusted % Total revenue 1 (£m) 414.1 428.4 (3%) 3% Adjusted operating profit margin 26.7% 25.0% 1.7% pts 0.7% pts Adjusted profit before tax 1 (£m) 109.2 106.5 3% 8% Adjusted diluted EPS 1 81.3p 76.4p 6% Dividend per share 32.5p 30.6p 6% Net cash/(debt) (£m) 78.3 (154.6) Cash conversion 3 102% 118% Effective tax rate 20% 19% Includes the results of continuing and discontinued operations and is reconciled in the appendix to the preliminary report 1. At constant exchange rates, including pro forma prior year comparatives for acquisitions and excluding disposals 2. Underlying 12 month cash conversion – details on slide 43 3.

8 Underlying revenue growth of 3% 2017 to 2018 total revenue 1 bridge (£m) Business Revenue 428.4 (7.5) Growth: in focus Commodity Events £1.7m (16.9) Banking & Finance £3.4m 414.1 10.1 404.0 Pricing, Data & MI £11.7m FY17 FX Net M&A FY17 reported Business FY18 reported revenue revenue growth reported revenue (pre FY18 revenue Asset Management underlying (£6.7m) movement) Includes the results of continuing and discontinued operations 1.

9 Underlying PBT growth of 8% 2017 to 2018 adjusted profit 1 bridge (£m) Business Profit: 109.2 in focus (6.4) 1.5 Commodity Events 106.5 £1.8m Banking & Finance 9.2 £1.6m 101.6 (2.9) 1.3 Pricing, Data & MI £7.7m 3 FY17 FX Net M&A FY17 Central costs Net Interest Business FY18 Adjusted PBT Adjusted PBT Receivable profit Adjusted PBT (pre FY18 (incl Asset Management underlying Associates 2 (£2.6m) movement) and JVs) Includes the results of continuing and discontinued operations 1. Business profit of £9.2m includes £0.7m profit from Associates and JV’s 2. £1.5m FX movement is analysed on page 16 3.

10 Asset Management Revenue reductions reflect the impact of lower client research spend, a ■ Underlying Growth 1 trend accelerated by MiFID II Revenue Actions taken in Investment Research to address the market challenge in ■ August 2018 reduce annual costs by £7m through: (2%) (4%) Product rationalisation □ Restructuring □ □ Office rationalisation FY17 FY18 Allowing profit protection, and new investment in sales and marketing, Adjusted Operating Profit digital technology and product development 3% ■ Institutional Investor revenue (44% of segment) was 1% down (underlying) following the transition to digital only (4%) ■ Extel acquisition in March 2018 FY17 FY18 At constant exchange rates, including pro forma prior year comparatives for acquisitions and excluding disposals 1.

11 Pricing, Data & Market Intelligence Strong growth - underlying 12% growth in subscriptions revenue from ■ Underlying Growth 1 continued success of newly rebranded Fastmarkets Revenue 6% underlying events revenue growth largely due to Telcap’s Capacity ■ Europe event in H1 Good growth at Insurance Insider ■ 9% Despite investment we have significantly improved operating profit ■ 3% performance FY17 FY18 Acquisition of Random Lengths August 2018 for $18.8m – wood-pricing ■ Adjusted Operating Profit provider, filling strategic gap (see page 47) 18% (6%) FY17 FY18 At constant exchange rates, including pro forma prior year comparatives for acquisitions and excluding disposals, discontinued operations 1.

12 Banking & Finance Return to underlying revenue growth ■ Underlying Growth 1 Revenue ■ 70% of revenue is delivered by events. Underlying revenue growth of 5% largely due to strong performance of IMN in the US and new events in China. This has offset the decline in print advertising (which is now 9% of 5% total segment revenues) (6%) Significant improvement in underlying profit growth with the elimination ■ of low margin events and a focus on larger high-margin events FY17 FY18 Adjusted Operating Profit 10% 5% FY17 FY18 At constant exchange rates, including pro forma prior year comparatives for acquisitions and excluding disposals, discontinued operations 1.

13 Commodity Events Return to underlying revenue growth ■ Underlying Growth 1 Revenue ■ Focus on large, repeat, high-margin events Mining Indaba disposal (see page 46) ■ 9% ■ Remaining events now managed across other segments, so the Commodity Events segment will not be separately disclosed from 2019 (8%) onwards (see page 36) FY17 FY18 Adjusted Operating Profit 25% 7% FY17 FY18 COMMODITY EVENTS COMMODITY EVENTS At constant exchange rates, including pro forma prior year comparatives for acquisitions and excluding disposals, discontinued operations, including Mining Indaba in both years 1.

14 2018 Revenue and profit matrix by segment/type 1 Revenue (£m) Profit (£m) Subscriptions/ Content Advertising Events Other Total Total (5%) (7%) 6% (62%) (4%) (4%) 119.7 11.9 19.4 0.0 151.0 61.1 Asset Management 12% (0%) 6% (43%) 9% 18% 90.6 16.9 36.7 0.5 144.7 53.2 Pricing, Data & Market Intelligence 2% (9%) 8% 8% 5% 10% 8.6 8.7 52.3 1.1 70.8 17.7 Banking & Finance 9% (40%) 9% 25% N/A N/A 20.6 0.2 20.8 9.1 Commodity Events - - - - - - 24.7 0.2 0.8 0.0 25.7 8.6 Closed & Sold Businesses - - - N/A N/A N/A 1.2 1.2 1.3 FX Gains on forward contracts 2% (5%) 7% - 3% 7% 243.6 37.7 129.8 3.0 414.1 151.0 Total segment revenue/profit (41.8) - Central costs and Interest/Facility Fees 8% 109.2 Adjusted PBT Key to colours  Pink – decline of -1% to -5%  Dark green – growth more than 2%  Dark red – decline more than -5%  Light green – growth of 0% to 2%  White – not colour-coded due to their small  Amber – decline of 0% to -1% size The absolute £ figures are 2018 total revenues, the percentages and colours refer to year-on-year growth rates restated for currency at constant exchange rates and net M&A 1.

15 Adjusted operating profit margin increases to 27% Commodity Events growth ■ 2017 adjusted operating margin 25.0% primarily due to our focus on FX (incl hedging) 0.8% large, high-margin repeat events Net M&A 0.2% ■ Asset Management strategic Underlying business: actions taken has protected H2 Commodity Events 0.3% margin Asset Management (0.2%) ■ Pricing, Data & Market Pricing, Data & Market Intelligence 1.1% Intelligence margin growth due to flow-through of revenue Banking & Finance 0.2% performance and focus on cost 1.4% controls Central costs (0.7%) ■ Standalone central costs drag 0.7% reduced, team largely complete 2018 adjusted operating margin 26.7%

16 Impact of FX GBP/USD rate £1.5m year-on-year FX benefit to adjusted PBT: 1.45 ■ GBP/USD rate strengthened 8 cents to $1.35 1.40 £5.9m FX loss year-on-year on translation of non-UK ■ entities profits 1.35 $/£ £3.6m FX loss year-on-year on UK embedded FX ■ 1.30 £12.1m benefit year-on-year due to hedging gains ■ 1.25 related to forward contracts (see page 39) £1.1m FX loss year-on-year on balance sheet ■ 1.20 Oct-16 Dec-16 Feb-17 Apr-17 Jun-17 Aug-17 Oct-17 Dec-17 Feb-18 Apr-18 Jun-18 Aug-18 revaluation Outlook remains uncertain given forthcoming UK exit FY17: $1.27 FY18: $1.35 from the EU