TIDMERM
RNS Number : 3962L
Euromoney Institutional InvestorPLC
30 April 2020
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR THE PURPOSES OF ARTICLE 7 OF EU REGULATION 596/2014
EUROMONEY INSTITUTIONAL INVESTOR PLC ("Euromoney")
Updates on the strategic review of Asset Management and
covid-19
30 April 2020
Euromoney, the international B2B information services provider
of essential information to global and specialist markets, today
provides an update on the strategic review of its Asset Management
businesses and a further update to the market on the impact of
covid-19 on the Group.
Asset Management strategic review
On 10 September 2019, Euromoney announced a strategic review of
its Asset Management businesses, which consist of Institutional
Investor, BCA Research and NDR. During an extensive process, the
Board carefully considered a range of options, including continued
ownership and a potential sale of all or part of the segment. The
Board has concluded that the best outcome for shareholder value is
for Euromoney to remain the long-term owner of all three
businesses, which have high levels of recurring subscription
revenue and attractive profit margins. The Asset Management
businesses will no longer be reported as discontinued operations
and as assets held for sale.
Update on covid-19
On 11 March 2020, Euromoney announced an update on the impact of
covid-19 on our events businesses until the end of June 2020, given
governments' restrictions on travel and attending gatherings. Our
assessment of the potential financial impact of covid-19 on our
events businesses in the period to June 2020 has not materially
changed.
As a consequence of the continued global disruption caused by
covid-19 and its impact on business activity, we have now taken the
decision to postpone or cancel the majority of events originally
scheduled to take place from July up to and including September
(Euromoney's Q4). At this stage it is not possible to determine
exactly how many events will take place in Q4 and, if events are
held, what the impact of covid-19-related disruption could be on
attendance and sponsorship. The financial profile of the 173 events
originally scheduled in Q4 2020 is revenue of approximately GBP34m
(GBP6m in July, GBP2m in August and GBP26m in September). The gross
profit from these events was expected to be around GBP18m. The
larger events have approximately GBP7m of committed costs already
incurred, and therefore the gross profit impact of running no
events in Q4 would be approximately GBP25m.
Actions to reduce costs and sustain our strong liquidity
position
Euromoney has taken swift and decisive action to reduce costs
and preserve cash, while supporting employees, serving customers
and protecting the long-term health of the business. We have
already taken steps to minimise non-contractual spend, postpone
capital expenditure, freeze pay and limit new hires. We are
exploring government support schemes to further protect jobs and
prioritise liquidity. We have placed some UK employees, mainly
those involved in events, on temporary furlough under the UK
Government's Coronavirus Job Retention Scheme and are taking
advantage of similar job retention and wage support schemes in
other countries. From 1 May 2020, all Directors will take a
temporary 25% reduction in their salaries or fees, except for
Andrew Rashbass, CEO, who will take a 40% cut.
Additionally, the Board is adopting a prudent approach to
shareholder distributions and will not declare an interim dividend
payment for FY20, resulting in a cash saving of approximately
GBP12m. The Board will consider the FY20 total dividend in November
2020, when it has better visibility on the business
environment.
High level of subscriptions
Euromoney continues to benefit from the relative predictability
of subscriptions, which accounted for 60% of total revenue in FY19.
However, the effects of covid-19 on broader economic activity are
likely to result in customers delaying purchasing decisions, and
restrictions on face-to-face sales meetings may impact our ability
to close new sales.
Robust financial position
Euromoney's financial position remains strong. We recently
extended our bank facilities, with committed funding of GBP188m
available through to December 2022. Net cash at the end of March
2020 was GBP8m.
Interim results
Interim results for the six months to 31 March 2020 are now
scheduled to be announced on 4 June 2020. As previously announced,
for the current financial year the Group will report under three
new segments: Asset Management; Pricing; and Data & Market
Intelligence. Summary financial information restated for this new
segmental disclosure for the six month period ended 31 March 2019,
is available on the Investor Relations section of the Euromoney
website, www.euromoneyplc.com .
Management will host a short call for analysts and investors at
9:30am today with a presentation available on the Euromoney
website, www.euromoneyplc.com . Dial in details: +44 (0)330 336
9125 Code: 8164395
Andrew Rashbass, CEO of Euromoney said: "In the face of the
unprecedented challenges created by covid-19, we continue to
prioritise the health and wellbeing of our employees, customers and
business partners. Although our event businesses face short-term
uncertainties, we have taken rapid action to contain our costs and
protect our financial position. We have a robust balance sheet and
strong brands that position us well for the long term.
After conducting a thorough strategic review of our Asset
Management businesses, the Board concluded that we remain the best
long-term owner of these assets. We will continue to position them
for a return to sustained growth."
For further information, please contact:
Euromoney Institutional Investor PLC
Wendy Pallot, Chief Financial Officer: +44 20 7779 8866;
wendy.pallot@euromoneyplc.com
Chris Collett, Investor Relations: +44 (0)20 7779 8636;
chris.collett@euromoneyplc.com
FTI Consulting
Charles Palmer / Jamie Ricketts / Amy Hurnell / Jamille Smith:
+44 20 3727 1000; euromoney@fticonsulting.com
NOTE TO EDITORS
Euromoney is a global information business providing essential
B2B information to international and specialist markets. Euromoney
provides price discovery, market intelligence and events across our
segments. Euromoney is listed on the London Stock Exchange and is a
member of the FTSE 250 share index. ( www.euromoneyplc.com )
LEI number: 213800PZU2RGHMHE2S67
Ends
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