Organisers continue costcutting as revenues plunge
Hyve restructures finance team as revenues drop by half ; Informa delays events into spring 2021 and announces big H1 loss
Hyve Group
In a trading update for the year ending 30 September , international exhibition organiser Hyve Group said it expected FY20 revenues to be less than half of 2019 ’ s figure .
Hyve said it expected FY20 revenues to come in around £ 105m ( US $ 133.3m ) ( 2019 : £ 221m ) which , it said , reflected a “ very strong start to the financial year but a significantly reduced event programme since March as a result of Covid-19 ”.
The group said it had safely run a number of domestic events in China and Ukraine and its first Russian events since lockdown commenced 22 September ( including WorldFood Moscow ). The group now expected to run 12 face-to-face events in Q4 of FY20 , delivering c .£ 9m of revenues between them .
Hyve completed a £ 126m rights issue in June and said it had taken significant cost saving measures to reduce cash burn . Since the last trading update in July , a further
Top , right : Stephen A Carter , CEO Informa
Left : Mark Shashoua , CEO Hyve Group
£ 9.1m in insurance payouts had been received , taking total recoveries secured to date to £ 22m .
At 30 September , the group said it expected net debt to be no more than £ 80m .
Nevertheless , with the timing and speed of the recovery of the global events industry remaining uncertain and travel restrictions expected to remain in place for some time , Hyve said it was mindful that any events that do take place are likely to be smaller than previous editions and customer confidence could take time to return .
Hyve ’ s cost-saving programme announced in May targeted £ 9m of income statement savings in the current financial year , and £ 40m in FY21 .
The group has merged its UK and Global Brands operations as well as cutting overheads at headquarters . The entire event portfolio in Azerbaijan and Uzbekistan has been disposed of for a consideration of around £ 9.5m , payable over a number of years , with events in these regions not expected to resume for some time .
Andrew Beach , chief financial officer ( CFO ), has stepped down and will hand over to John Gulliver , currently group chief operating officer ( COO ). James Warsop , the current group financial controller moves up to group finance director .
The group continues to progress its omnichannel strategy . ShopTalk Virtual Meetup takes place in October and should provide a key test case for the potential monetisation of a digitally delivered event .
Group CEO Mark Shashoua said the changes to the business were necessary steps and noted that early and decisive action to strengthen the balance sheet when the crisis emerged meant the group was well positioned to weather the Covid-19 crisis .
“ The return of 12 events since lockdown marks the early signals of a slow and safe return to face-to-face events , albeit we remain prudent and mindful that we may see further lockdowns and it may also take time for customer confidence to return ,” Shashoua said .
Informa
Exhibition giant Informa announced a pre-tax loss of £ 739.9m ( US $ 946.9m ) in its financial results for the six-months ended 30 June 2020 , with the group saying it would extend delays of events into spring next year as part of its strategy to stabilise the business .
The results for H1 showed an adjusted operating profit of £ 118.6m ( H1 2019 : £ 435.7m ) on revenues of £ 814.4m ( H1 2019 : £ 1,407.6m ).
Informa ’ s events business in Mainland China is coming back , however , with 20 B2B events scheduled before year-end .
Informa ’ s Action Plan to stabilise the business includes delivering more than £ 600m of savings by year-end . This is in addition to the £ 300m of cost savings made in H1 . There will be targeted compulsory redundancies , largely in North America and EMEA .
Informa expects a combination of lower costs , more efficient financing and effective cash management to secure a positive monthly cashflow position by January 2021 .
The group put its current liquidity at £ 2.8bn , with intention to renegotiate or repay US private placement notes , combined with a planned issue of around £ 500m equivalent Euro Bonds , extending drawn debt maturity through to 2023 .
The Informa chairman ’ s succession process , which was paused in March , has resumed with the aim being to conclude it by year-end .
www . exhibitionworld . co . uk Issue 5 2020 9