TIDMREL
RNS Number : 8364C
RELX PLC
13 February 2020
News release
13 February 2020
RESULTS FOR THE YEAR TO 31 DECEMBER 2019
RELX, the global provider of information-based analytics and
decision tools, reports continued growth in revenue, operating
profit and earnings in 2019.
Highlights
Ø Revenue GBP7,874m +5%, underlying growth +4%
Ø Adjusted operating profit GBP2,491m +6%, underlying growth +5%
Ø Adjusted EPS 93.0p +10%, constant currency growth +7%
Ø Reported operating profit GBP2,101m +7%
Ø Reported EPS 77.4p +8%
Ø Proposed full year dividend 45.7p +9%
Ø Strong financial position; cash conversion rate 96%; net debt/EBITDA
2.5x
Ø Completed 14 acquisitions for total consideration of GBP416m;
announced two further acquisitions in 2020
Ø GBP600m of share buybacks completed in 2019, announcing total
of GBP400m for 2020
2020 outlook
Ø Key business trends in the early part of 2020 are consistent
with recent years, and we are confident that, by continuing to execute
on our strategy, we will deliver another year of underlying growth
in revenue and in adjusted operating profit, together with growth in
adjusted earnings per share on a constant currency basis
Commenting on the results, Sir Anthony Habgood, Chair, said:
"RELX continued to execute well on its strategic priorities in
2019. This was reflected in strong earnings, with adjusted earnings
per share growth of +10% in sterling, and +7% at constant
currencies, and we have proposed an increase in the dividend of
+9%. We also continued to build on our strong ESG performance
during the year, and this was again recognised in the high ratings
given to us by a number of external agencies."
Chief Executive Officer, Erik Engstrom, commented:
"RELX continued to make good progress in 2019. Our number one
strategic priority is unchanged: the organic development of
increasingly sophisticated information-based analytics and decision
tools that deliver enhanced value to our customers, supplemented by
selective acquisitions of targeted data, analytics and exhibition
assets that support our organic growth strategies."
"We achieved good underlying revenue growth, with underlying
adjusted operating profit growth slightly ahead of underlying
revenue growth, and adjusted earnings per share growth at constant
currencies ahead of underlying profit growth."
2019 RESULTS
Revenue GBP7,874m (GBP7,492m) +5%; underlying growth +4%: The
underlying growth rate reflects good growth in electronic and
face-to-face revenues (91% of the total), and the further
development of our analytics and decision tools, partially offset
by continued print revenue declines.
Adjusted operating profit GBP2,491m (GBP2,346m) +6%; underlying
growth +5%: Growth was driven by revenue growth and continued
operating process innovation.
Reported operating profit GBP2,101m (GBP1,964m) +7%: Reported
operating profit includes amortisation of acquired intangible
assets of GBP295m (GBP288m) and acquisition-related costs of GBP84m
(GBP84m).
Interest and tax: Adjusted net interest expense was GBP291m
(GBP201m), with the increase including a charge of GBP99m in
respect of the early redemption of bonds that were scheduled to
mature in October 2022, partially offset by lower average interest
rates on borrowings. The adjusted tax charge was GBP388m (GBP465m),
and includes a credit of GBP89m in respect of a substantial
resolution during the year of certain historical tax issues, giving
an effective tax rate of 17.6%. Excluding this item, the adjusted
effective tax rate would have been 21.7%, in line with the prior
year.
Reported net interest expense was GBP305m (GBP211m), and the
reported tax charge was GBP338m (GBP292m).
Adjusted EPS 93.0p (84.7p) +10%; constant currency growth
+7%
Reported EPS 77.4p (71.9p) +8%: Reported EPS includes a credit
for gains on disposals and other non-operating items of GBP51m
(GBP33m charge).
Dividend: We are proposing a full year dividend of 45.7p (42.1p)
+9%.
ROIC: Return on invested capital was 13.6% (13.2%), benefitting
from the lower adjusted tax rate mentioned above. Based on a tax
rate of 21.7% ROIC would have been 13.0%.
Net debt/EBITDA 2.5x (2.4x) including leases and pensions: Net
debt, including leases as per IFRS 16, was GBP6.2bn (GBP6.2bn) at
31 December 2019. Excluding leases and pensions, net debt/EBITDA
was 2.2x. The adjusted cash flow conversion rate was 96% (96%),
with capital expenditure as a percentage of revenues remaining at
5%.
Portfolio development: In 2019 we completed 14 acquisitions of
content, data analytics and exhibition assets for a total
consideration of GBP416m, and disposed of a number of small assets
for a total of GBP63m. Since the year end we have completed the
acquisition of ID Analytics, a provider of credit and fraud risk
solutions, and agreed to acquire Emailage, a provider of email
based fraud prevention solutions.
Share buybacks: We deployed GBP600m on share buybacks in 2019.
We intend to deploy a total of GBP400m in 2020, of which GBP100m
has already been completed.
Environmental, social and governance (ESG) recognition: In 2019
RELX was ranked second in the S&P Global 1200 for ESG
performance based on CSRHub data, and sixth in the newly launched
Responsibility 100 index of FTSE 100 companies measured against the
United Nations 17 Sustainable Development Goals (SDGs). In 2019
RELX retained its AAA ESG rating with MSCI for the fourth
consecutive year, and in January 2020 a Sustainalytics ESG report
put RELX in the top one percent of over 12,000 companies
covered.
RELX FINANCIAL SUMMARY
Year ended 31 December
------------------------------ ----------------------------------------------
Change
2019 2018 at constant Underlying
GBPm GBPm Change currencies growth
------------------------------ ----- ----- ------ ------------ ----------
Revenue 7,874 7,492 +5% +2% +4%
------------------------------ ----- ----- ------ ------------ ----------
Adjusted operating profit 2,491 2,346 +6% +3% +5%
Adjusted operating margin 31.6% 31.3%
------------------------------ ----- ----- ------ ------------ ----------
Reported operating profit 2,101 1,964 +7%
------------------------------ ----- ----- ------ ------------ ----------
Adjusted net interest expense (291) (201)
------------------------------ ----- ----- ------ ------------ ----------
Adjusted profit before tax 2,200 2,145 +3% 0%
------------------------------ ----- ----- ------ ------------ ----------
Adjusted tax (388) (465)
Non-controlling interests (4) (6)
------------------------------ ----- ----- ------ ------------ ----------
Adjusted net profit 1,808 1,674 +8% +5%
------------------------------ ----- ----- ------ ------------ ----------
Reported net profit 1,505 1,422 +6%
------------------------------ ----- ----- ------ ------------ ----------
Reported net margin 19.1% 19.0%
------------------------------ ----- ----- ------ ------------ ----------
Adjusted earnings per share 93.0p 84.7p +10% +7%
------------------------------ ----- ----- ------ ------------ ----------
Reported earnings per share 77.4p 71.9p +8%
------------------------------ ----- ----- ------ ------------ ----------
Net borrowings 6,191 6,177
------------------------------ ----- ----- ------ ------------ ----------
Ordinary dividend per share 45.7p 42.1p +9%
------------------------------ ----- ----- ------ ------------ ----------
RELX uses adjusted and underlying figures as additional
performance measures. Adjusted figures primarily exclude the
amortisation of acquired intangible assets and other items related
to acquisitions and disposals, and the associated deferred tax
movements. In 2018 we excluded exceptional tax credits.
Reconciliations between the reported and adjusted figures are set
out on page 30. Underlying growth rates are calculated at constant
currencies, excluding the results of acquisitions until twelve
months after purchase, and excluding the results of disposals and
assets held for sale. Underlying revenue growth rates also exclude
exhibition cycling. Constant currency growth rates are based on
2018 full-year average and hedge exchange rates.
ENQUIRIES: Colin Tennant (Investors) Paul Abrahams (Media)
+44 (0)20 7166 5751 +44 (0)20 7166 5724
Disclaimer regarding forward-looking statements
This Announcement contains forward-looking statements within the
meaning of Section 27A of the US Securities Act of 1933, as
amended, and Section 21E of the US Securities Exchange Act of 1934,
as amended. These statements are subject to risks and uncertainties
that could cause actual results or outcomes of RELX PLC (together
with its subsidiaries, "RELX", "we" or "our") to differ materially
from those expressed in any forward-looking statement. The terms
"outlook", "estimate", "project", "plan", "intend", "expect",
"should", "will", "believe", "trends" and similar expressions may
indicate a forward-looking statement. Important factors that could
cause actual results or outcomes to differ materially from
estimates or forecasts contained in the forward-looking statements
include, among others, current and future economic, political and
market forces; changes in law and legal interpretations affecting
RELX intellectual property rights and internet communications;
regulatory and other changes regarding the collection, transfer or
use of third-party content and data; demand for RELX products and
services; competitive factors in the industries in which RELX
operates; ability to realise the future anticipated benefits of
acquisitions; significant failure or interruption of our systems;
compromises of our data security systems or other unauthorised
access to our databases; legislative, fiscal, tax and regulatory
developments and political risks; exchange rate fluctuations; and
other risks referenced from time to time in the filings of RELX PLC
with the US Securities and Exchange Commission.
RELX is a global provider of information-based analytics and
decision tools for professional and business customers. RELX serves
customers in more than 180 countries and has offices in about 40
countries. It employs over 33,000 people, of whom almost half are
in North America. The shares of RELX PLC, the parent company, are
traded on the London, Amsterdam and New York stock exchanges using
the following ticker symbols: London: REL; Amsterdam: REN; New
York: RELX. The market capitalisation is approximately
GBP39bn/EUR47bn/$51bn.
The Annual Report and Financial Statements 2019 are expected to
be available on the RELX website at www.relx.com from 20 February
2020. Copies of the Annual Report and Financial Statements 2019 are
expected to be posted to shareholders of RELX PLC on 5 March 2020.
Copies of the 2019 Results Announcement are available to the public
on the RELX website and from:
RELX PLC
1-3 Strand
London WC2N 5JR
United Kingdom
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view the associated PDF document.
http://www.rns-pdf.londonstockexchange.com/rns/8364C_1-2020-2-12.pdf
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END
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