Euromoney continues in line after sale of GMID

The FTSE 250 company said underlying revenue in the quarter to 30 June was flat compared to last year when adjusted for exchange-rate differences, acquisitions, disposals and discontinued operations.

Reported revenue of £107.9m for the quarter was down 9% compared to last year, which the board said was largely due to exchange and the sale of the Global Markets Intelligence Division (GMID), which was an entirely subscription-based business.

Underlying subscriptions and content revenue increased by 2% to £54.5m.

Euromoney said the divergence in subscription growth rates between the pricing, data and market-intelligence segment and the asset-management segment had continued.

Pricing, data and market-intelligence subscription revenue increased by an underlying 14%, with the headwinds facing the investment-research division - BCA and NDR - within the asset-management segment said to have been somewhat offset by the improved trends in Institutional Investor's membership business.

That resulted in subscription revenue in this segment declining by 5% on an underlying basis, with strategic actions underway to tackle BCA's challenges.

Underlying event revenue increased by 1% against a strong prior year, with the board continuing to concentrate on larger, high-margin events and market trends remain positive.

“In response to evolving reader and advertiser needs, we transitioned Institutional Investor magazine to a digital-only format in April and therefore ceased printing the publication,” Euromoney said in its statement.

“This contributed to the 8% decline in underlying advertising revenue during the period.”

The group said it generated about three-quarters of both its revenue and operating profits in dollars, with the average sterling-dollar rate for the quarter sitting at $1.37, compared to $1.27 a year ago.

Each annualised one-cent movement in the exchange rate has a £0.7m impact on profits.

“GMID has been treated as a discontinued operation in this trading update,” the board added.

The disposal was successfully completed on 30 April for $180.5m (£129m) before tax and deal costs.

“Net cash at 30 June was £94.1m compared to net debt of £37.0m at 31 March 2018.

“The increase in cash reflects $165.3m (£117.8m) net proceeds from the disposal of GMID and continued strong operating cash flow, offset by tax payments and the interim dividend.

“We expect further GMID tax and transaction costs before the end of the financial year.”

Euromoney said its preliminary results for the year to 30 September would be announced on 22 November.