Resilient numbers and Board changes
Euromoney Institutional Investor (L:ERM)’s FY15 results were in line with expectations that reflected the difficult trading in the investment banking and commodity segments. New CEO, Andrew Rashbass, took the helm on 1 October and is carrying out a strategic review, the results of which will be shared in early 2016. Cash generation remains very strong and his options are broadened by ERM’s financial strength – net cash was £18m at the year-end. It has invested heavily in new ways of adding value to the delivery of its market expertise that will stand it in good stead when its clients’ trading conditions improve.
Headwinds currently greater than tailwinds
Subscription revenues, the largest element of revenue by activity at 52%, have been growing modestly but consistently, at around 2% over the last two years. Delegates and Sponsorships are the next largest at 17% and 15% respectively. The Conferences, Seminars and Training division has seen typical cyclical trading. Larger events continue to perform well, but with smaller events and training suffering from constraints in client budgets. The combination of fall-off in conferences and in advertising revenues has affected margin beyond the level previously factored into forecasts to reflect corporate activity and event timing differences. Our revised forecasts reflect a continuation of these difficult trading conditions through H116, with a stabilisation in H216 as comparatives ease.
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