AUS
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IND
Summary
- Informa Plc had projected its FY20 revenue to remain in the range from £1.65 billion to £1.68 billion.
- The adjusted operating profit is likely to fall in the range from £250 million to £270 million.
- The subscription led business had an immense contribution of around £300 million of adjusted operating profit during FY20.
- The Company had not declared an interim dividend during H1 FY20.
Informa Plc is the FTSE 100 listed media company, engaged in providing international Information Services, Advanced Learning, B2B Exhibitions and Events Group. Based on its 1-year performance, shares of INF have generated a return of about negative 32.72%.
Recent Developments - The Company will announce its full-year FY20 results on 22 April 2021.
Business Model
The Company operates through two broad business segments: Subscription-Led Business and Events-Led Business. The former represented 54% of revenues while the latter constitutes 46% of total revenues.
Subscription-Led Business - The portfolio encapsulates two comprehensive aspects of the business –
Taylor & Francis - Taylor & Francis is engaged in publishing research-based academic content across several subjects such as Social Science, Science and Technology & Medicine. It is well-known on an international level through its reputed brands as shown below -
(Source: Company presentation)
Informa Intelligence – This segment renders services in the field of data intelligence catering to several industry needs. The Company is engaged in business with various sectors such as Healthcare, Finance, Tourism, and Industry & Infrastructure through a range of specialist B2B subscription brands shown below -
(Source: Company presentation)
Events-Led Business - This division covers three-wide aspects of the business:
Informa Markets – Informa Markets business segment render services to industries through F2F exhibitions, providing enriching online content and having more than 450 international B2B brands. Some of the prominent brands are shown below -
(Source: Company presentation)
Informa Connect - Informa Connect create content-driven events to share knowledge through various communities which participate in these events. This business division focuses on Life Sciences and Finance through 500 brands as shown below -
(Source: Company presentation)
Informa Tech - Informa Tech provides technology education and connect people around the world. This segment render services like knowledge building, and develop platforms for customers to engage, learn in order to create a better digital world. Some of the prominent brands are shown below-
(Source: Company presentation)
Pre Closing FY20 Trading update (as on 06 January 2021)
- The Company had given similar financial guidance as provided during the announcement of half-year results. The FY20 revenues remain in line to range from £1.65 billion to £1.68 billion and adjusted operating profit to be in the range from £250 million to £270 million.
- The Company had a plan to achieve £600 million of cost savings by year-end with £400 million of direct savings to adjusted operating profit and £200 million of annualized indirect savings.
- The subscription led business had an immense contribution of around £300 million of adjusted operating profit during FY20 due to strong demand for specialist data and knowledge despite the elevated levels of uncertainty created by the COVID-19 pandemic.
- Taylor & Francishad demonstrated a robust FY20 performance with underlying revenue growth to remain the same as that in FY19 despite widespread restriction caused by Covid-19 pandemic.
- Informa Intelligence is focused towards four primary markets: Pharma Intelligence, Retail Financial Intelligence, Maritime Intelligence and Asset Intelligence. All four division had shown resilient business performance during 2020. This segment had demonstrated renewal rates of more than 90% and a robust forward sales pipeline.
- All three Event-led businesses, Informa Markets, Informa Connectand Informa Tech, were adversely hit by Covid-19 pandemic due to widespread lockdowns. It had made just 40% of 2019 revenues during FY20 in the USA.
Financial Highlights (for the six months ended on 30 June 2020 as reported on 21 September 2020)
(Source: Company result)
- The reported revenue of the Company had dropped by almost 42.1% to £814.4 million during H1 FY20 ended on 30 June 2020 from £1,407.6 million achieved in the equivalent period of the prior year.
- The reported adjusted operating profit also declined by 72.8% to £118.6 million during H1 FY20 compared to £435.7 million for the equivalent period of the previous year. The adjusted operating margin was declined to 14.6%.
- The adjusted diluted earnings per share went down to 5.0 pence during H1 FY20.
- Regarding its financial position, the Company had reduced its net debt from £2,846 million as of 30 June 2019 to £1,947.9 million as of 30 June 2020.
- The free cash flow stood at £71.3 million as of 30 June 2020 having robust cash conversion and efficient cost management.
- The Company had generated an operating cash flow of £183.5 million during H1 FY20, while it had generated an operating cash flow of £415.1 million during H1 FY19.
- The Company had not declared an interim dividend in light of Covid-19 pandemic.
Share Price Performance Analysis of Informa Plc
(Source: EODHD/Others, chart created by Kalkine group)
Shares of Informa Plc last traded at GBX 566.20 (as on 08 January 2021). INF's 52-week High and Low were GBX 870.80 and GBX 326.70, respectively. Informa Plc had a market capitalization of around £8.57 billion.
Business Outlook
The roll-out of Covid-19 vaccine has given the much-required boost to consumers’ confidence as it would recover to normal levels in 2021. The Event-based business will witness a fair recovery during 2021 further supported by its Postponement Programme for events by deferring the launch of the 2021 calendar to late Spring. The Company had scheduled 90% of events from June 2021 which were earlier scheduled to occur early 2021. However, the subscription-based business had kickstarted 2021 on a sparkling note with most of the subscriptions are falling in the mid renewal period. This particular segment would witness higher renewal rates and good annualized contract values.
