Ascential posts solid first half growth

Business-to-business information company Ascential said it traded in line with its expectations in the first half on Monday, with revenue from continuing operations of £222m, up from £176.2m in the first half of last year.

The FTSE 250 firm said reported growth in the six months to 30 June was 26%, or 7.2% on a constant currency basis.

Adjusted EBITDA from continuing operations was £81.4m, up from £63.2m, with the margin expanding to 36.7% from 35.9% as a result of the foreign exchange benefit in exhibitions and festivals more than offsetting planned product investment in information services.

The reported operating profit from continuing operations was up 28% at £48.1m.

“We have delivered successful first half results in line with our expectations,” said chief executive Duncan Painter.

“We grew both revenues and profits driven by the focus on our primary brands and on customer retention.

“The launch of new products such as WGSN Insight and the growth of our live, content-rich event extensions, Money20/20 Europe and Bett Middle East, contributed well to our growth.”

On a divisional basis, Ascential said there was “strong” organic growth in exhibitions and festivals, with revenue up 8.2% to £137m and adjusted EBITDA rising 8.9% to £64.5m.

Information services revenue was ahead 5.2% to £85m, with adjusted EBITDA improving 1.1% to £24.5m.

The board said it made “good progress” on the integration of the One Click Retail and MediaLink acquisitions in the information services division.

Adjusted pro forma diluted earnings per share from continuing operations were ahead 55% on the first half of last year to 13.3p, and ahead 44% on total operations to 13.4p.

Reported basic and diluted earnings per share from total operations was up to 7.1p, from 2.5p year-on-year.

“The business continues to generate significant cash flows to fund investment, dividends and acquisitions and the integration of MediaLink and One Click Retail are progressing according to plan, enhancing our offering and opening up new opportunities for growth,” Painter explained.

“Furthermore the strategic actions we have taken in the last 12 months enable us to optimise the focus on our primary brands and further accelerate our product and international revenue diversification.”

Ascential said there was also “strong” cash generation in the period, with free cash flow after tax and capex of £74.5m, up from £58.7m, resulting in a closing net debt leverage of 1.7x after continued business, and mergers and acquisitions investment - compared to 2.1x at the start of the period.

Operating cash flow conversion stood at 103%, up from 98%, and free cash flow conversion improved to 91% from 87%.

The board declared an interim dividend of 1.8p per share, an increase of 20%.

“With our Information Services division already contributing well to our organic growth, the benefit of enhanced growth contributions coming from recently acquired brands and the investments we continue to make to enhance our products and capabilities we remain confident that we will continue to deliver leading growth rates.

“We enter the second half of 2017 with positive momentum,” Duncan Painter added.

“With our current level of forward bookings and the increasing geographic diversification of our revenue streams, we are confident that we will achieve our full year expectations.”