Ascential declares maiden dividend as events drive first half growth

Ascential, the publishing and events business spun off by the Guardian in February, posted solid results in its seasonally stronger first half of the year as strong events growth made up for a flatter publishing arm.

Results were pretty much as the market expected, with a maiden interim dividend of 1.5p per share slightly ahead of forecasts, management said the level of forward bookings gave confidence that full year targets will be hit.

In a period that included its prestigious annual Cannes Lions advertising festival and the launch of the Money20/20 Europe event, Ascential grew revenues 13.5% on a reported basis to £202.5m or, if taking out effects of currencies and the timings of events, acquisitions and disposals, revenue grew 8.8%.

On this 'organic' basis and also excluding planned declines in print advertising, revenues increased 10.1%.

The events are enjoyed organic revenue growth of 15.3% to £119.1m, with adjusted EBITDA up 14.5% to £53.5m on an organic basis.

Information services, which includes fashion trend forecasting unit WGSN and environmental and flood search specialist Groundsure, grew revenue just 0.7% on an organic basis to £83.4m and with margins remaining strong EBITDA grew 5.9% on an organic basis to £20.1m

Information services grew 3.2% if the ongoing retreat in print advertising is taken out, with print advertising now representing less than 3% of group revenues over the last 12 months, down from more than 4% at June 2015.

At a group level, reported operating profit was up 39.3% to £39.7m, or up 27.7% to £59.9m if adjusted for exceptional items, amortisation, impairment of tangible and intangible fixed assets and share-based payments.

Strong free cash flow of £58.7m meant the ratio of net debt to EBITDA was down to 1.9x.

"Based on the level of our forward bookings we are confident that we will achieve our full year expectations," said chief executive Duncan Painter.

"Whilst economic uncertainty has been increased by the UK's decision to leave the European Union, our currency mix, market-leading brands, low dependency on advertising and our majority international customer base, provide us a level of protection against this risk."

House broker Numis nudged its forecasts higher, increasing its 2016 pre-tax profit to £75.2m from £72.1m and earnings per share to 15p from 14.4p, with 2017 PBT/EPS up to £84m/16.4p from £80.8m/15.8p.