Centaur Media plc, the business information and events group, has issued a pre-close trading statement for the financial year ended 30 June 2011. The Group expects to report profits at the top end of the Board’s expectations, with reported revenues 14% ahead of the prior year and EBITDA margins increased from 11% to 14%. Underlying FY11 revenues, excluding the impact of acquisitions and adjusting for the phasing of exhibitions, are 10% ahead.
Digital advertising revenues continued to show stronger growth than print, with H2 revenues 21% ahead of the same period last year. Print advertising revenues grew by 7% in H2. Total advertising revenues, on both a reported and underlying basis, grew by 14% year on year.
Total reported paid for content revenues grew by 7% in H2, with Perfect Information increasing its digital revenues by 8% over the same period. Underlying total paid for content revenues are only marginally up year on year reflecting continuing weakness across the consumer publishing titles.
Events revenues continue to show steady growth, with reported H2 revenues 20% ahead of the same period last year. Underlying year on year revenue growth across the events portfolio was 13%. Marketing Week Live reported record visitor numbers and revenues 26% ahead of last year. Forward bookings across the Group’s exhibitions portfolio are showing strong growth compared to the same time last year.
Impact of the restructuring
As recently reported on Fusion DigiNet, the Group has restructured into three operating divisions, the senior management team is being strengthened, operations within Business Publishing are being rationalised and a number of non-core assets have been targeted for disposal.
The Group anticipates that the annualised cost savings related to these initiatives will exceed £1.5m with an associated exceptional cash charge in FY11, principally related to redundancy costs, of approximately £2.5m. There will also be a significant non-cash impairment charge in relation to the write down of assets affected by the restructuring. The restructuring will have no impact on the Group’s underlying performance for the year to 30 June 2011.
The rationalisation of Business Publishing and disposal of non-core assets will reduce pro-forma FY11 revenues by approximately £7m. These assets made a small profit contribution to the Group in FY11.
The restructuring is designed to enable the Group to focus in the short and medium term on a portfolio of higher growth and higher margin assets.
The Group is targeting EBITDA margins of 20% within the next 12-18 months, driven by the further investment across new products and digital platforms within the new operational structure and benefiting from the cost saving and rationalisation initiatives announced on 28 June.
As a consequence of the restructure of the business into three main operating divisions: Business Publishing, Business Information and Exhibitions, the Group will be adopting a new segmental reporting structure in the FY11 preliminary results that reflects the way the business is now managed.
Cash flow and balance sheet
The Group continues to maintain a strong balance sheet, with high levels of cash generation in the second half of the year. After taking into account the cash outflow related to the FEM acquisition announced in April 2011, the Group will report net cash at 30 June 2011 of approximately £2m.
The Group has an existing credit facility with The Royal Bank of Scotland, which has been recently increased from £5m to £8m and extended to October 2012. In addition to providing adequate headroom for the Group’s working capital requirements, the increase in the facility will provide additional capacity to finance bolt on acquisitions.
The Group expects to publish its full year results on 15 September 2011.
Geoff Wilmot, Chief Executive, commented
“The last quarter of the year, which is normally our strongest, ended at the top end of our expectations. The improved trading conditions experienced in FY11 have continued into the current financial year. The recently announced restructuring and rationalisation, our portfolio of market leading brands and our strengthened management team, will enable Centaur to benefit more rapidly from continuing recovery and from the recent investments in digital services. This will provide a robust platform from which to deliver accelerated revenue growth and margin improvement in the medium term.”
- Centaur Media plc to be restructured and to sell off some titles Posted on June 30, 2011
- Centaur Media PLC – Interim Management Statement Posted on May 12, 2011
- Centaur Media acquires The Forum for Expatriate Management for up to £6.75M April 7, 2011
- Centaur Media has acquired for Taxbriefs £1.9 million Posted on June 2, 2010