quickening the pace - tarsus group...quickening the pace annual results presentation - march 2017...

Quickening the Pace Annual Results Presentation - March 2017

Agenda ■ 2016 Highlights

■ Financial and operating review

■ Strategy

■ Outlook

■ Summary

■ Q&A

2

2016 Highlights ■ Continuing strong organic growth

■ Like for like revenue growth +8% ■ Like for like buyer growth +7% ■ 10 further replications

■ Deepened presence in US and Chinese markets

■ 4 acquisitions ■ Connect, Hometex, Intex, PEP

■ Driving scale and momentum

3

Financial and operating review

financial trends ■ Strong organic revenue +8%

■ Profits and earnings growth

■ Dividend up 8%

■ Investment in replications and launches

■ Good operating cash performance

■ Balance sheet remains strong

5

6

2014 2015 2016 2014 v 2016

Group Revenue £60.6m £86.9m £68.4m +13%

Adjusted PBT £17.0m £26.3m £19.2m +13%

Adjusted Tax Rate 15% 15% 15% --

Adjusted EPS 12.7p 21.4p 15.2p +20%

Dividend 7.8p 8.4p 9.1p +17%

Net debt £38.4m £43.8m £69.5m

Financial overview

2011 2012 2013 2014 2015

8%

LFL organic revenue growth

13%

11%10% 10%

AVERAGE 10%

8%

2016

ORGANIC GROWTH DELIVERY

2011 2012 2013 2014 2015

6.3p6.8p

7.3p7.8p

8.4p

Dividend

CAGR 8%

*proposed 2016 dividend

9.1p*

2016

7

2015 Revenue

100

90

80

70

60

50

40

30

20

10

0

2016 Biennials 2015 Biennials Acquisitions Disposals FX Organic Growth

£86.9m

£9.1m £34.5m

£0.8m £6.6m £7.5m £86.9m

REVENUE BRIDGE

£5.2m

2016 Revenue

£68.4m

8

USD CNY TRY GBP OTHER

FX exposure2017 PROFORMA REVENUE

4%

16%

9%

7%

64%

9

10

Financial results by geography AMERICAS

2014 2015 2016 2014 v 2016

Annual revenue 19.4 26.0 31.3 +62%

Biennial revenue 5.1 - 6.8 +33%

Total revenue 24.5 26.0 38.1 +56%

Adjusted profit 12.7 11.4 17.1 +35%

Operational review- AMERICASMedical

■ Orlando and Las Vegas shows had record editions

■ PAINWeek very strong led by new drug pipeline

■ SBS and Cardio weaker drug pipeline ■ Medical division returns to growth

Labels ■ Excellent performance with visitors +8% ■ Strong rebook for 2018 event

Offprice ■ Continued solid peformance ■ Impact of religious holiday on August show

Mexico ■ Good performances from Expo Manufactura and Plastimagen

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Financial results by geography EMEA

2014 2015 2016 2014 V 2016

Annual revenue 12.5 12.0 13.7 +10%

Biennial revenue 3.2 32.7 3.7 +15%

Total revenue 15.7 44.7 17.4 +11%

Adjusted profit 2.3 15.3 2.1 -9%

Operational review- EMEADubai

■ GESS strong – buyers up 18% ■ AIME, MRO and MEBAA all solid performances

Turkey ■ Ideal Homex, Zuchex, Sign and Flower Show all performed well

■ Domestic attendees robust ■ Cautious budgeting for 2017

Europe ■ Additive Manufacturing relaunched as B2B in Amsterdam

■ Labels publishing progressing well

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Financial results by geographyASIA

2014 2015 2016 2014 V 2016

Annual revenue 9.9 9.4 11.8 20%

Biennial revenue 0.8 1.8 1.0 20%

Total revenue 10.7 11.2 12.8 20%

Adjusted profit 4.1 3.3 4.8 17%

Operational review- ASIAChina

■ SIUF strong – buyers up 13% ■ AAITF strengthening in Shenzhen ■ Hope revenues ahead of 2015 ■ Hometex and Intex added

South East Asia ■ Indonesia –strong buyer attendance at IIICE and second replication of GESS strong

■ Philippines – good first edition of Wofex under Tarsus ownership

■ Solid progress in Cambodia, Myanmar, Sri Lanka

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Dec ‘15 Share Proceeds / Purchases

DividendsNet Aquisitions Interest & Tax

Exceptionals FV IR Swap Cashflow from operations

Dec ‘16

100

90

80

70

60

50

40

30

20

10

0

£43.8m

£69.5m

£22.3m£50.7m

£3.1m £2.5m £1.4m £18.6m£8.9m

net debt bridge

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NET DEBT ■ Gearing at 2.2x at December 2016 reflecting acquisitions

■ Placing raised £23.4m (net) to part fund acquisitions

■ Long / medium term target of 1.5-2.0x remains

■ Bank facilities increased to £111m to December 2020

■ Interest rates fixed

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Financial review summary

■ Strong underlying financial results helped by currency tailwinds

■ Good underlying growth in revenues and earnings

■ Dividend up to 9.1p

■ Strong operating cash generation

■ Strong balance sheet position

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Strategy update

ORGANIC - REVENUE AND BUYERS

REPLICATIONS

ACQUISITIONS – BOLT-ONS

quickening the pace

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Target 2014 2015 2016

Accelerating EPS growth 5-10%pa ü ü ü

Buyer growth 5% ü ü ü

Quickening the paceCONTINUING DELIVERY AGAINST TARGETS

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Strategy ■ Drive towards US and Asia ■ Increase US dollar exposure ■ Focus on markets in transition ■ Growth and replication opportunities ■ Attractive valuation multiples on acquisitions ■ Opportunities for Tarsus to add value and growth to targets

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Strategic progress ■ Scaling established geographical footprint ■ Acquisitions in 2 largest industry geographies - US and China

■ Replications supplementing organic growth ■ Strong organic growth in buyer attendance +7%

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15

10

5

0

%

2013 2014 2015 2016

15

10

5

0

%

Like for Like Revenue Growth Buyer Growth

2013 2014 2015 2016

11%10% 10%

8% 8%

6%

9%7%

Organic Growth

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driving growth in buyers

■ Salesforce ■ Best practice ■ Events 3.0 • Content • Quality interaction

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Replications growth2015 2016 2017

Total Launched 15 10 20

Total Repeated - 8 19

Total 15 18 39

Share of group revenue 2% 3% 4%

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PLATFORMS FOR GROWTHExisting New

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China ■ 2015 Government strategy

■ Tarsus focused on domestic consumer driven markets

■ 2 key trading hubs

■ Shanghai ■ Shenzhen

28

Acquisition of Intex

■ Intex is a major event organising business based in Shanghai

■ Main Brands

■ Music China ■ CES Asia ■ Flower Show ■ Rail and Metro China

■ Strong Government partner

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Acquisition of HOMETEX

■ Major event organiser based in Shenzhen

■ Shenzhen is the second largest exhibition market in China

■ Bi-annual Home Furnishing Expo with Spring edition occupying all available space (1.15m sqft) in 2016

■ Venue capacity tripling in 2019

■ Hometex has strong industry, association and local government support

■ Tarsus owns a third of the largest exhibitions held in Shenzhen

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connect - summary ■ Leading US events in the business travel and meetings sector

■ Trade show founded in 2007 ■ Original family run publishing business established in 1992

■ Flagship annual event - Connect Marketplace ■ 13 events in 2016 ■ Integrated media offering – publishing and online

■ Strong management team ■ Good growth potential

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CONNECT - Business ModelConnect Marketplace Vertical Events Regional Events

California New England

Hawaii Texas

Missouri Georgia

South West Pacific NW

Integrated media to support meetings

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ManagementASIA

■ CEO Asia ■ MD South East Asia

US ■ New Business Development Director

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Outlook

Outlook ■ Like for like bookings +10% ■ “Quickening the Pace” - 2017 strong delivery ■ Management confident of strong performance in 2017

■ “Quickening the Pace” going forward: driving scale and momentum

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OUTlook- AMERICASMedical

■ Growth continues for divisionOffprice

■ Continued solid performanceConnect

■ Growth in main event ■ Verticals, regional and international launches

Mexico ■ Expo Manufactura and Plastimagen strong ■ GESS third and Energy second editions

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OUTlook- EMEALabelexpo

■ Package Printing and Digital driving growthDubai

■ Airshow prospects strong driven by growth initiatives (Cargo, Space, Drones)

■ Further growth at GESSTurkey

■ Budgeting cautiously given geopolitical position

■ Bookings slower

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OUTlook- ASIAChina

■ AAITF performed well ■ Hometex and Intex additions on track ■ Promising outlook overall

South East Asia ■ Scaling up and expanding ■ Promising outlook

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Summary

Summary ■ Performed well in 2016 ■ Good strategic progress - “Quickening the Pace” delivering

■ Organic revenue growth at 8% ■ Buyer attendance 7% ■ Progressive dividend policy continues ■ Well positioned for 2017 with strong forward bookings

■ “Quickening the Pace” going forward: driving scale and momentum

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Q & A

glossaryAdjusted Profit: Calculated using profit after tax attributable to equity shareholders adjusted for exceptional items, share option charges /credits, amortisation charges, impairment of intangibles, profit / loss on disposal of intangibles and tangible fixed assets, profit on sale of subsidiary and unwinding of discount.

Gearing: Calculated using net debt divided by EBITDA average of the previous two years. Including aquisitions as if they were owned throughout the 24 month period.

EBITDA: Calculated using adjusted earnings before interest, tax, depreciation and amortisation charges.

Proforma revenue: Revenue excluding any disposals made in the year and including the group’s share of any revenue recorded in joint venture companies not consolidated.

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APPENDIX

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REVENUE

£’000 2014 2015 2016

EU 2,581 12,991 2,493

USA 24,557 25,401 37,688

EM 23,736 43,562 28,177

CONTINUING 50,874 81,954 68,358

DISC OPS 9,694 4,924 -

TOTAL 60,568 86,877 68,358

£’000 2014 2015 2016

EMEA 15,706 44,676 17,418

AMERICAS 24,492 26,046 38,122

ASIA 10,676 11,232 12,818

CONTINUING 50,874 81,954 68,358

DISC OPS 9,694 4,924 -

TOTAL 60,568 86,877 68,358

Old Segments New Segments

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ADJUSTED PROFIT

£’000 2014 2015 2016

EU 69 3,804 98

USA 11,694 11,386 15,453

EM 7,323 14,954 8,485

CENTRAL COST (1,614) (2,142) (2,429)

INTEREST (1,685) (1,988) (2,427)

CONTINUING 15,787 26,014 19,180

DISC OPS 1,164 306 -

TOTAL 16,951 26,320 19,180

£’000 2014 2015 2016

EMEA 2,282 15,339 2,144

AMERICAS 12,683 11,423 17,088

ASIA 4,121 3,288 4,804

CENTRAL COST (1,614) (2,142) (2,429)

INTEREST (1,685) (1,988) (2,427)

CONTINUING 15,787 25,920 19,180

DISC OPS 1,164 400 -

TOTAL 16,951 26,320 19,180

Old Segments New Segments

EXCEPTIONAL ITEMS ■ Cost of corporate transactions (£2.3m)

■ Reduction of put / calls £4.1m

Net exceptional credit £1.8m

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