ITE Group plc Trading Update
26 January 2017
ITE Group plc
(“ITE” or the “Group”)
ITE Group plc is today publishing a Trading Update for the period from 1 October 2016 to the date of this announcement, incorporating the Group’s first quarter trading period from 1 October 2016 to 31 December 2016. This coincides with the Group’s Annual General Meeting which is being held at 12 noon today.
First Quarter Trading Update
The Group’s trading in this quarter was in line with management expectations.
Revenue for the three month period to 31 December 2016 was £35.0m (three months to 31 December 2015: £34.8m). On a like-for-like basis revenues for the quarter are, as expected, 4% lower than the comparative period reflecting continued weakness in Central Asia and the impact of lower oil prices on our Africa Oil Week event.
The Group’s balance sheet remains sound and we continue to see strong operational cash flows. Following the recent acquisition of a 70% stake in Shanghai Gehua, net debt stood at c£61m on 20 January 2017.
Outlook and Strategy Review Update
Trading conditions in a number of the regions in which we operate continue to be challenging. Further terrorist acts in Turkey are having a continued negative impact on international bookings on events in the region. Due to the uncertainty caused by the demonetisation of certain Indian banknotes, bookings on events in India have been negatively impacted, particularly in the real estate, fashion & accessories and construction sectors. As a result, it is possible that a number of smaller events in India will be postponed or cancelled.
Whilst recent forecasts for improved economic growth in some of our core markets, and recent exchange rate movements, will be favourable if sustained, as previously flagged, given the high visibility of our business model with events booked in advance, there will be a lag before these benefits are reflected in our reporting results.
At 20 January 2017, Group revenues booked for FY 2017 were £99 million (at current exchange rates) representing circa 72% of market expectations for the full year. On a like-for-like basis these revenues are circa 2% ahead of this time last year.
The review of the business and strategy, announced in November 2016, is well underway and on track.
The Board is comfortable with the market revenue expectations for the full year, and has taken the view that in order to improve sales performance next year and beyond, a number of new sales and marketing initiatives will be accelerated in advance of the review announcement. The cost of these planned investments will be partially recognised in the current financial year, resulting in a profit slightly below market expectations for the full year.
The results of the review will be announced alongside the Group’s Interim Results for the six months ending 31 March 2017 on Tuesday 16 May 2017.
Where used, like-for-like measures are stated on a constant currency basis adjusted to exclude acquisitions impacting results for the first time, event timing differences and biennial events.
Mark Shashoua, Chief Executive Officer, ITE Group plc
Tel: 020 7596 5000
Andrew Beach, Chief Financial Officer, ITE Group plc
Tel: 020 7596 5000
Charles Palmer/Emma Appleton, FTI Consulting
Tel: 020 3727 1000
Nick Westlake/Toby Adcock, Numis Securities Ltd
Tel: 020 7260 1000
This Interim Management Statement is prepared for and addressed only to the Group's shareholders as a whole and to no other person. The Group, its directors, employees, agents or advisers do not accept or assume responsibility to any other person to whom this Interim Management Statement is shown or into whose hands it may come and any such responsibility or liability is expressly disclaimed. Statements contained in this Interim Management Statement are based on the knowledge and information available to the Group's Directors at the date it was prepared and therefore the facts stated and views expressed may change after that date. Other than the information contained in this Interim Management Statement there have been no material events or transactions in the period from 31 December 2016 to 26 January 2017. By their nature, the statements concerning the risks and uncertainties facing the Group in this Interim Management Statement involve uncertainty since future events and circumstances can cause results and developments to differ materially from those anticipated. To the extent that this Interim Management Statement contains any statement dealing with any time after the date of its preparation such statement is merely predictive and speculative as it relates to events and circumstances which are yet to occur. The Group undertakes no obligation to update these forward-looking statements.
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