Hyve Group plc Preliminary Results Year ended 30 September 2019 3 December 2019
Agenda › Highlights Mark Shashoua › Preliminary results Andrew Beach › Transformation delivered Mark Shashoua › TAG financials Andrew Beach Mark Shashoua › Q&A & Andrew Beach Preliminary results: year ended 30 September 2019 / 2
Highlights FY19 › Another strong year driven by the TAG programme despite challenging macro-economic conditions o LFL revenue growth 7% o LFL profit growth 16% Transformation delivered Portfolio transformed since launch of TAG - 15 acquired events › fully integrated and 154 events closed or divested Ahead of plan on all TAG investment targets › › Built a centralised operating model and returned the business to sustainable growth Preliminary results: year ended 30 September 2019 / 3
Preliminary results Andrew Beach, CFO Preliminary results: year ended 30 September 2019 / 4
Preliminary results FY19 highlights FY19 FY18 Revenue £220.7m £175.7m LFL growth 7% Headline PBT £50.4m £35.4m LFL growth 16% Operating profit margin 25.3% 22.0% Increase of 3.3pp one-off £4.2m £7.0m TAG costs Within guidance ongoing £8.0m £7.5m Net debt £111.7m £82.7m <2x EBITDA, within guidance Headline diluted EPS 4.9p 4.9p In line with expectations Dividend 2.5p 2.5p Maintained at 2x EPS cover / 5 Preliminary results: year ended 30 September 2019
Preliminary results Revenue bridge (£5.3m) (£2.3m) £10.7m £47.9m (£6.0m) £220.7m £m £m £m TRY (1.4) Russia 6.6 £175.7m Ascential/ 62.5 Mining Indaba RUB (0.8) AOW 1.2 INR (0.5) Breakbulk 0.6 ITE Expo (Russia)/ Central Asia/Other (14.6) Other 0.4 Other 2.3 FY18 Net Biennial Acquisitions Launches & FX Impact Underlying FY19 & Timing & Disposals Cancellations Trading Preliminary results: year ended 30 September 2019 / 6
Preliminary results Top 10 TAG events drove higher revenue growth 25% Top 10 TAG Rest of portfolio LFL growth LFL growth Average yield Average yield Top 10 TAG TOTAL Top 10 TAG TOTAL £309/sqm 1 £266/sqm 1 13% 7% 1 Total group revenue / total group sqm (excluding AOW and Mining Indaba conferences) Preliminary results: year ended 30 September 2019 / 7
Preliminary results Headline PBT bridge (£0.5m) (£4.2m) £4.7m £15.4m (£0.4m) £50.4m £m £m Revenue £35.4m (2.3) Ascential / Translational 17.6 Mining Indaba Cost Translational 1.5 ITE Expo (Russia) / (0.8) Translational Central Asia / (2.2) Other Transactional (B/S) (3.4) FY18 Net Biennial Acquisitions Launches & FX Impact Underlying FY19 & Timing & Disposals Cancellations Trading Preliminary results: year ended 30 September 2019 / 8
Preliminary results Strong revenue visibility for FY20 LFL increase of 4% £152m revenue booked 1 for FY20 Represents 66% of consensus 1 Booked at 29 November 2019 at actual event rates for past events and at FX rates at 28 November 2019 for future events Preliminary results: year ended 30 September 2019 / 9
Preliminary results Financial summary Strong LFL revenue growth; Step change Top 10 TAG events towards sustainable double-digit operating margins growth Profit growth significantly above Excellent FY20 revenue growth revenue visibility Preliminary results: year ended 30 September 2019 / 10
Transformation delivered Mark Shashoua, CEO Preliminary results: year ended 30 September 2019 / 11
Transformation delivered Historical context prior to TAG programme Revenue decline and unsustainable margins Changing customer expectations › Exhibitors demand Return on Investment -11% CAGR £192m £175m › Visitors demand Return on Time £136m £134m › Greater emphasis on learning and networking within a business community 31% 35% 36% 29% FY13 FY14 FY15 FY16 Headline operating profit Costs Preliminary results: year ended 30 September 2019 / 12
Transformation delivered Our vision “To create the world’s leading portfolio of content-driven, must-attend events delivering an outstanding experience and ROI for our customers.” Preliminary results: year ended 30 September 2019 / 13
Transformation delivered Transformation and Growth programme TAG Programme Create a Manage Product-led Scalable Platform the Portfolio Acquisitions Underpinned by a performance-led culture Preliminary results: year ended 30 September 2019 / 14
Transformation delivered Scalable operating model created Created best practice functions & teams Invested in show operations Built capability & talent Drove a performance culture Built fit-for-purpose IT infrastructure & systems Preliminary results: year ended 30 September 2019 / 15
Transformation delivered Breakbulk Europe TAG improvements since FY16 › 37% more space sold FY16 › Visitor NPS improved from +8 to +28 › Revenue per exhibitor up 55% › Overall revenue up 67% Preliminary results: year ended 30 September 2019 / 16 FY19
FY16 * Transformation delivered Africa Oil Week TAG improvements since FY17 * › Delegate NPS (FY18-19) ** improved from +18 to +32 FY20 › Paid delegates (FY17-19) up 33% › Overall revenue (FY17-19) up 40% *Hyve took full ownership of AOW in May 2017, i.e. FY17 Preliminary results: year ended 30 September 2019 / 17 **Delegate NPS figures first recorded in FY18
Transformation delivered Strengthened KPIs from our Top 10 TAG events New customer service New high quality Systematic lead generation drives team helps exhibitors content attracts growth maximise success key visitors Exhibitor NPS (FY16-19) Visitor NPS (FY16-19) New business (FY18-19) increased from +3 to +14; increased from +14 to +28; increased by >25% industry average is -17 * industry average is +7 ** * UFI & Explori, Global Exhibitor Insights, November 2017 Edition Preliminary results: year ended 30 September 2019 / 18 **UFI & Explori, Global Visitor Insights, 2018/19 Edition
Transformation delivered Quality of portfolio improved since launch of TAG Manage the portfolio May 2017 Sep 2019 No. of events 269 130 52% Revenue £134m 2 £221m 3 64% 89 Revenue per event £0.5m £1.7m 240% Product-led acquisitions 65 269 events 15 130 events 1 May 2017 Closed Divested Acquired Sep 2019 1 Launch of TAG, May 2017 2 FY16 reported revenue Preliminary results: year ended 30 September 2019 / 19 3 FY19 reported revenue
Transformation delivered A more balanced geographical footprint FY17 Revenue FY19 Revenue Global Brands Global 12% UK Brands 22% 23% Asia 16% 47% Russia 10% Asia 28% Russia 14% 9% Central Central 8% Asia 11% Asia ESE ESE Preliminary results: year ended 30 September 2019 / 20
Transformation delivered Integration of acquisitions is complete Reinvesting half of the synergies to drive future growth Re-edit events to improve customer experience Focus on key accounts Integration Grow international events to scale Launch hosted buyers programme Investigate new markets over the longer term Synergies Sector expansion in Germany Grow international events to scale in China Launch hosted buyers programme Investigate new markets over the longer term Investment plans Re-edit events and add new sectors Visitor acquisition teams to target online and major chains 1 Focus on customer proposition between events Operational integration with Africa Oil Week 1 Moda was an existing Hyve event Preliminary results: year ended 30 September 2019 / 21
Transformation delivered Targeted trajectory for recent acquisitions Investment plans Division Acquired events FY19 FY20 FY21 UK Ascential events Inherited trajectory Stabilise Grow Global Brands Ascential events Inherited trajectory Grow Grow Global Brands Mining Indaba Inherited trajectory Grow Grow Preliminary results: year ended 30 September 2019 / 22
Transformation delivered Returned the business to sustainable growth Revenue and headline operating profit TAG £221m -11% +18% £192m CAGR CAGR £176m £175m £153m £136m £134m 31% 35% 36% 29% 23% 22% 25% FY13 FY14 FY15 FY16 FY17 FY18 FY19 Headline operating profit Costs Preliminary results: year ended 30 September 2019 / 23
TAG financials Andrew Beach Preliminary results: year ended 30 September 2019 / 24
TAG financials One-off TAG programme investment Plan FY17 £6-7m FY18 £8-10m FY19 £4-6m £20m FY20 Actual FY17 £5.0m FY18 £7.0m FY19 £4.2m forecast £3.8m One-off Costs Mix Investment by Transformation Lever Best Practice Infrastructure & Invest in Show Performance Capability Capex Opex - Exceptional Systems Operations Culture & Talent Preliminary results: year ended 30 September 2019 / 25
TAG financials Ahead of plan on all TAG investment targets Target Original plan Revised Status Positive ROI FY20 FY19 Delivered early ROI > WACC FY21 FY20 Ahead Cash payback FY21 FY21 Ahead 1 1 Original plan delivery expected H2 FY21; revised to H1 FY21 Preliminary results: year ended 30 September 2019 / 26
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