ite group plc - pliipreliminary rltr esults preliminary results...2012 financial results ite group...

P li i R ltPreliminary Results Year ended 30 September 2012

Introduction

Story of 2012

Strong year 8% L4L profit growth

Story of 2012

Strong year

Increase in MosBuild cost base

ex MosBuild

Now absorbed

Integration of acquired businesses Better than plan

£20m cashReplenishing cash position

Groundwork in Asia

£20m cash @ 30 November

Good pipeline forward

2013 sales looking good4% L4L volume growth

ITE Group plc – Preliminary Results for the year ended 30 September 20122

0101

2012 Financial Results


Financial Highlights for the year to 30 September 2012Financial Results

Financial Highlights for the year to 30 September 2012

2012 2011

Audited Audited

Net trading +£3mAcquisitions +£22mBiennial ‐£8m

Net trading +£3mAcquisitions +£22mBiennial ‐£8m

Revenue £172.3m £155.5m

Gross profit margin 45% 48%

+11%

Gross profit margin 45% 48%

Headline profit before tax £53.0m £51.4m

Tax rate 20% 21%

Headline diluted EPS 16.9p 16.6p +2%

Dividend per share 6.5p 6.1p +7%


2011 to 2012 Gross Margin BridgeFinancial Results

2011 to 2012 Gross Margin Bridge

50

48 48.1% (1.6%)

46(0.6%)

(0.8%)

ross m

argin %

44

45.1%Gr

42

Gross margin 2011

MosBuild Biennial Acquisitions

38

40Gross margin

2012


38

2011 to 2012 Headline PBT BridgeFinancial Results

2011 to 2012 Headline PBT Bridge

60

8% Ex MosBuild8% Ex MosBuild

£46 5m

51.4 (4.9)

(4 5) (0 5)£M

507.6

3.9 53.0

£46.5m

30

40

(4.5) (0.5)

Headline PB

T £

20

30H

10

2011 headline

PBT

Net biennial effect

MosBuild Currency Acquisitions Organic growth

2012 headline

PBT


2011 to 2012 Cash Flow BridgeFinancial Results

2011 to 2012 Cash Flow Bridge

80

Turkey £3.5mUkraine £11.3mIndia £2.8mOther £2 0m

Turkey £3.5mUkraine £11.3mIndia £2.8mOther £2 0m

117%

6062.1

Other £2.0mOther £2.0m

(15.2)

40Cashflo

w£M

(11.6)

40C

(6.2)

(19.6)

20

5.5

13.0(2.0)

Net cash Sept 11

Cashflowfrom

operations

Tax Venue pre‐

payments

5 5

Acquisitions & def

considerations

Net cash Sept 12

Dividends Other


Sales and Yield AnalysisFinancial Results

Sales and Yield Analysis

Metres Revenue GrossP fit YieldProfit

000s £m £m Per m²

2011

Results from Events 644 154 75

Non annual 2011 (57) (12) (6)

Recurring Events 587 142 69 24218 l h18 l h

2012

Acquisitions 150 22 9

Net growth 14 4 (1)

18 new launches £1.6m revenue18 new launches £1.6m revenue

2012 Net growth 14 4 (1)

Recurring Events 751 168 77 224

£ 243 ex £ 243 ex

2012Non annual 2012 48 4 1

Results from Events 799 172 78

acquisitionsacquisitions


Currency & HedgingFinancial Results

Currency & Hedging

Average Sales RateCurrency of

Sale 2013 (F) % 2012 %

g

2013YTD

2012

Forward cover 2013 – 2015 ‐ €100m@ €1.19 : £1

Forward cover 2013 – 2015 ‐ €100m@ €1.19 : £1

EUR 40 54 1.25 1.17

RUB 33 21 50 47

€ 1.16 in 2011€ 1.16 in 2011

GBP 7 7 1.0 1.0

YTL 5 5 2.85 2.82

Other 15 13

1 cent = £0.4m : 1 Ruble = £0.3m

Ruble revenues increased – better matching of revenue & costs

Aim to balance currency exposure ⅓ Euro ⅓ Ruble ⅓ other


Trading Update – 2013 Contracted RevenueFinancial Results

Trading Update – 2013 Contracted Revenue

£m Sales booked

80% Booked of consensus revenues at time of preliminary announcement

60

54% 56% 56%53%52%£70m £54m £93m

£95m£74

40

%54% 53%52%0 £95m£74m

54% 56% 52% 56% 56%20

Vs. market Vs. market

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

expectation of £180Mexpectation of £180M


0202

Strategy


Strategy


VisionStrategy

Vision

‘To be the world’s‘To be the world’s leading organiser of trade exhibitions intrade exhibitions in emerging markets’


LeadershipStrategy

Leadership

Industry dust yLeadership

Customer recognition of ITE quality


MarketsStrategy

Markets

Birmingham

St. Petersburg

Moscow

i

Novosibirsk

AstanaLondonKyiv

Istanbul BakuAlmaty

Tashkent

Astana

Krasnodar

Delhi

Mumbai

Chennai

existing markets

target markets


Strengthening Market PositionStrategy

Strengthening Market Position

Quality of Product

Better Content

Event Reputation

Venue Relations

International Sales

Venue Relations

Local Office Strength


Expanding the Business ModelStrategy

Expanding the Business Model

+ international sales + investment

International BrandsNew Sectors

India

MoscowPackaging, Furniture, Dairy, Wood,

IndiaConstruction, Education, Real Estate, Metallurgy, Paper

‘Geo

TurkeyFood, Construction, Travel,

Machinery

Printing

Established ITEMarkets & Sectors

o‐cloning’

UKChildrenswear, Lingerie,

Designerwear

UkraineMotors Oil Logistics

Turkey Motors, Oil, Logistics,

HVAC IndiaS. E. AsiaChina

Expanding Markets

ConfexPower, Waste,

Water


Building Stronger BrandsStrategy

Building Stronger Brands


Growing MarketsStrategy

Growing Markets

Established presenceUSA11

Targeted presence

Others

USA

10

11

ze $bn

2 Germany

market siz

1

UK China

R i1 Russia

TurkeyIndia

BrazilS.E. Asia

% Expected Industry CAGR(2011 – 2016)

5 10


p y ( )

Developing talentStrategy

Developing talent

G HR Di tGroup HR Director

Management conferences

Leadership programme

Mentoring programme

Communication systems


Primary Business ObjectivesStrategy

Primary Business Objectives

• Create sustainable growth in headline EPS

• Create and maintain sustainable positions of market leadership in the exhibition business in high growth marketsthe exhibition business in high growth markets


Strategy

The story so farThe story so far

25

30

50

60

pence£'m

2040

diluted EP

S

t before tax

10

15

20

30

Headline d

Headline profit

510

H

002003 2004 2005 2006 2007 2008 2009 2010 2011 2012


0303

Divisional Analysis


Divisional AnalysisDivisional Analysis

Divisional Analysis

2012

Revenue Contribution

2011

Revenue Contribution

£105m £42m

£27m £9m

£106m £47m

£22m £8m

Russia

C. Asia

£28m £9m

£12m £4m

£18m £4m

£10m £3m

S/E Europe

ROW £12m £4m

£172m £64m

( )

£10m £3m

£156m £62m

( )

ROW

Group (£11m)

£53m

(£11m)

£51m

Group


RussiaDivisional Analysis

Russia

2012 2011Good growth in secondary shows

m² ‘000 392 345

Revenue £105m £106m

Good growth in secondary shows

L4L revenues marginally down MOSCOW

Revenue £105m £106m

St. PETERSBURG

L4L revenue growth 15%

New venue agreement


N di iKRASNODAR

NOVOSIBIRSK

New venue discussions


Looking forward MosBuild on track

NOVOSIBIRSKNew venue costs


Looking forward... MosBuild on track

Central AsiaDivisional Analysis

Central Asia

2012 2011L4L revenue growth 9%

m² ‘000 80 67

Revenue £27 0m £21 9m


New conference business in AstanaKAZAKHSTAN

Revenue £27.0m £21.9m

AZERBAIJANL4L revenue growth 41%

New Venue opportunities


8 Y tUZBEKISTAN

8 Year venue agreement

Looking forward More of the same


Looking forward... More of the same

Eastern & Southern EuropeDivisional Analysis

Eastern & Southern Europe

2012 2011L4L revenue growth 3%

m² ‘000 269 186



Portfolio expansion – Autoexpo & BeautexUKRAINE


TURKEYL4L revenue growth 8%

First time Turkeybuild better than plan

Looking forward More potential bolt–ons in Turkey


Looking forward... More potential bolt–ons in Turkey

Rest of the WorldDivisional Analysis

Rest of the World

2012 2011Core business steady – L4L revenues growth 5%

m² ‘000 59 47


Core business steady L4L revenues growth 5%

Niche extensions trading well / Jacket RequiredUK


INDIAExciting new partner ‐ ABEC

Strategy re‐work for India

Outbound office opened in Malaysia

G d i li i ibilitASIA

Good pipeline visibility

Looking forward New possibilities in India


Looking forward... New possibilities in India

Portfolio DiversificationDivisional Analysis

Portfolio Diversification

2012 2008

% of GroupGross Profit

% of GroupGross Profit

TOP 5 40% 57%

6 to 20 27% 22%

21 to 50 19% 13%

51 to 100 10% 4%

Rest 3% 4%Rest 3% 4%

Number of Events with Revenue of £2m+ 20 9


GDP Growth in ITE’s MarketsDivisional Analysis

GDP Growth in ITE s Markets

2013 GDP growth %

2014GDP growth %

Russia 3 8 3 9Russia 3.8 3.9

Kazakhstan 5.7 6.0

Azerbaijan 2.7 2.9

Uzbekistan 6.5 6.5

Ukraine 3.5 3.5

Turkey 3 5 4 0Turkey 3.5 4.0

UK 1.1 2.2

India 6.0 6.4

Source: IMF World Economic Outlook Database, October 2012


Key messagesSummary

Key messages

ITE is the 3rd largest emerging market exhibition organiserITE is the 3rd largest emerging market exhibition organiser

Building real strength in construction sector31

Building cross regional strength in construction sector

Building real strength in construction sector31Good trading conditions & business momentum

A strong balance sheet – cash today of £20m

Good pipeline visibility


Th k YThank You

Q&A


0404

Appendices


Shareholder Structure at 27th November 2012Appendices

Shareholder Structure at 27 November 2012

% No. of Shares( illi )(millions)

BlackrockSchrodersScottish Widows

15.5%11.8%7.5%

38.529.518.6

Threadneedle InvestmentsStandard LifeLegal and GeneralOld MutualDirectors

7.0%6.5%4.6%4.3%1 4%

17.316.211.410.73 5Directors

ESOTOther Institutions and individuals

1.4%

2.2%39.2%

3.5

5.497.8

Total Shares in issue 100% 248.9

Options in the money: 0.3% 0.7m

Management including options in the money 1.7%

Free float 96.1%

Average daily trading volume (6 months) 0.3m


Key Exhibitions (in 2012 gross profit order)Appendices

Key Exhibitions (in 2012 gross profit order)

Rank Event Location 2012 2011 2010Rank Event Location 2012m² sold

2011m² sold

2010m² sold

1 MosBuild (inc. Windows) Moscow 66,100 77,600 62,700

2 Moscow International Travel & Tourism (MITT) Moscow 20,000 21,000 19,500

3 World Food Moscow Moscow 24,400 22,800 21,000

4 T k b ild (YAPI) I t b l 36 100 35 000* 25 800*4 Turkeybuild (YAPI) Istanbul 36,100 35,000* 25,800*

5 MODA UK Birmingham 36,000 35,600 34,100

% of Gross Profit earned by Top 5 events 40%

* not under ITE ownership


Consolidated Balance SheetAppendices

Consolidated Balance Sheet30‐Sep‐12dit d £‘

30‐Sep‐11dit d £‘audited £‘m audited £‘m

Non Current Assets

• Goodwill & Intangibles 131.0 129.6

• Other non‐current assets 10.9 8.8141.9 138.4

Current Assets• Debtors due within 1 year 53.8 52.8• Net Cash 13.0 5.5

66.8 58.3

C di£38.6m £44.4m

Creditors• Deferred Revenue & Creditors 92.4 97.2• Deferred Consideration 0.9 4.1• Deferred Tax 14 4 13 1Deferred Tax 14.4 13.1• Provisions 1.2 1.4

108.9 115.8

Net Assets 99 8 80 9


Net Assets 99.8 80.9

Venue Pre‐payments and LoansAppendices

Venue Pre‐payments and LoansPrepayments Theme Rates

dVenue Location 30 Sept 2012 Protection Agreed

Expocenter Moscow ‐ 2017 2015

Crocus Moscow £0 2m 2015* 2015*Crocus Moscow £0.2m 2015* 2015*

Expocentre Novosibirsk £3.0m 2016 2016

Atakent Almaty £0 8m 2017 2017Atakent Almaty £0.8m 2017 2017

IEC Kiev £1.4m 2014 2014

Uzexpocentr Tashkent £0.2m 2019 2019U e poce t as e t 0. 0 9 0 9

CNR Istanbul £2.8m 2014 2014

Expocentre Baku £0.5m 2015 2015

TOTAL £8.9m


*show specific

Future ConsiderationAppendices

Future ConsiderationDeferred Consideration £m Financial Years

Jacket Required (UK) £0.5m 2014

Beautex (Ukraine) £0.3m 2013 & 2014

Expo.KZ (Kazakhstan) £0.1m 2013

£0.9m

Puts & calls

Turkeybuild (20% + 20%) £4.5m + £4.5m 2013 & 2014Turkeybuild (20% 20%) £4.5m £4.5m 2013 & 2014

Summit £1m 2014 or 2015

Scoop (Moda) (60%) £1m 2014 or 2015

ABEC (for extra 32%) £15m 2016


£26m

Revenue by Sector & Region 2012 (2011)Appendices

Revenue by Sector & Region 2012 (2011)

ITE Group Revenue by Region ITE Group Revenue by SectorITE Group Revenue by Region ITE Group Revenue by Sector

Russia 61% (67%)

Construction 42% (39%)

Oil & Gas 7% (12%)

Food 10% (10%)

T l 9% (9%)Russia 61% (67%)

Central Asia & Caucasus 16% (14%)

Eastern & Southern Europe 16% (12%)

UK &Western Europe 6% (6%)

Travel 9% (9%)

Motor 5% (4%)

Fashion 6% (6%)

IT 2% (2%)UK & Western Europe 6% (6%)

Rest of the World 1% (1%)Medical 3% (3%)

Other 16% (15%)


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