Euromoney posts solid first half filled with M&A activity

Euromoney Institutional Investor reported a “good” first-half performance in its interim results on Thursday, with total revenues up 3% to £209.6m, and underlying revenues up 4%.

The FTSE 250 firm said its adjusted profit before tax was ahead 6% at £52.0m, while its statutory profit before tax of £121.1m reflected an exceptional credit of £86.8m, which was primarily profit on the disposal of businesses.

It said it benefitted from prior-year strategic actions during the period, particularly in pricing, data and market intelligence.

Strong growth was also reported from events businesses across all sectors, mainly from large, annual events, although Euromoney did point to weak asset management performance, largely driven by clients’ reduction in research spend and accelerated by MiFID II.

There was a “significant” reduction in net debt since the year-end, reflecting the impact of merger and acquisition activity and continuing strong operating cash flows.

The Global Markets Intelligence Division disposal in April was expected to generate further net cash of £103m in the second half.

Euromoney also reported that its active portfolio management was ongoing, as it secured two acquisitions - TowerXchange and Extel - during the half, and completed five disposals - Adhesion, World Bulk Wine Exhibition, its Dealogic minority stake, Institutional Investor Journals and the Global Markets Intelligence Division.

The board increased the interim dividend by 16% to 10.2p, in line with its new dividend policy announced last year.

“These interim results demonstrate further progress with implementing our strategy - investing around big themes; creating a best-of-both-worlds operating model; and active portfolio management,” said chief executive Andrew Rashbass.

“Our continued investment in price discovery has been one of the drivers of growth in the period, both organically in Metal Bulletin and through the successful integration of RISI.”

Rashbass said improved banking and commodity markets, together with Euromoney’s focus on large events, helped to mitigate the impact of the challenges facing its investment research businesses, particularly BCA.

“We continued to sell businesses where we believe we are not the best owners, including the Global Markets Intelligence Division, and secured two bolt-on acquisitions.

“Overall, we have delivered a good first half performance and the progress we are seeing gives us confidence that we will meet the board's expectations for the full year.”