(Alliance News) - Informa on Thursday said it swung to an annual loss as event cancellations hurt the publishing and exhibitions firm, but it pointed to a recovery as global vaccination programmes rollout.
For 2020, Informa swung to a pretax loss of GBP1.14 billion after posting a profit of GBP318.7 million in 2019, as revenue slumped 43% to GBP1.66 billion from GBP2.89 billion in the prior year.
The revenue figure was in line with market forecasts. In its own guidance, given at the beginning of January, the FTSE 100-listed company had said it expected 2020 revenue to be in a range of GBP1.65 billion to GBP1.68 billion
Informa said the disruption to its physical events portfolio due to the coronavirus pandemic led to the decline in revenue.
Informa swung to a statutory operating loss of GBP880.4 million for 2020 following an operating profit of GBP538.1 million in 2019. This, it said, reflected the reduction in revenue as well as an increase in adjusting items, with a significant proportion relating to a non-cash goodwill impairment of GBP592.9 million.
No dividend was paid for 2020.
Looking ahead, Informa views 2021 as a "transition year", with continued growth in both Subscriptions-led businesses and further expansion in B2B digital services, supported by a progressive return in B2B physical events. The company pointed to an easing of Covid-19 restrictions and customer confidence rebuilding as reasons for optimism.
"This transition year will be defined by continued strength and improving growth in our subscriptions-led businesses, further growth in B2B digital services and a progressive reopening of physical events, led by mainland China and North America, which will ensure we deliver our revenue commitments for 2021, and remain cashflow positive throughout," said Chief Executive Officer Stephen Carter.
Informa confirmed its commitment for baseline revenue of GBP1.7 billion 2021, with any improvement to that depending on the "pace and scale of return of physical events outside of mainland China".
Informa shares were up 0.2% early Thursday.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.1% at 6,904.01
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Hang Seng: up 0.5% at 28,776.63
Nikkei 225: closed up 2.4% at 29,188.17
DJIA: closed up 316.01 points, or 0.9%, at 34,137.31
S&P 500: closed up 0.9% at 4,173.42
Nasdaq Composite: closed up 1.2% at 13,950.22
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EUR: firm at USD1.2040 (USD1.2034)
GBP: flat at USD1.3940 (USD1.3937)
USD: soft at JPY108.00 (JPY108.08)
Gold: down at USD1,791.94 per ounce (USD1,792.76)
Oil (Brent): down at USD64.90 a barrel (USD65.90)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Thursday's Key Economic Events still to come
1100 BST UK CBI industrial trends survey
1100 BST Ireland wholesale price index
1345 CEST EU ECB interest rate decision
1430 CEST EU press conference with ECB President Christine Lagarde
0830 EDT US initial jobless claims
1000 EDT US existing home sales
1030 EDT US EIA weekly natural gas storage report
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Almost 100,000 more UK businesses have tumbled into financial distress in the past three months as the impact of the pandemic continued to weigh on firms, according to new research. The latest quarter Red Flag Alert report by insolvency specialists Begbies Traynor found that around 723,000 businesses were in "significant financial distress" in the quarter to the end of March. It said this represented a jump of 93,000, the largest increase reported since the research started in its current form in 2014. This was a 15% increase from the end of the fourth quarter of 2020, as many firms stopped trading again during the third coronavirus lockdown.
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The opposition Labour party has demanded that the powerful Liaison Committee of MPs holds an urgent investigation into UK Prime Minister Boris Johnson's conduct after the latest revelation in a row over cronyism. The call came on Wednesday after it emerged Johnson exchanged text messages with billionaire James Dyson over the tax status of his employees. Johnson promised the entrepreneur he would "fix" the issue after personal lobbying from Dyson as he sought to build ventilators early in the coronavirus crisis.
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US President Joe Biden hopes to rally the world on climate as he unveils more ambitious US commitments Thursday at a summit that is expected to see a slew of new promises. Just three months into office, Biden will welcome 40 leaders for the two-day virtual Earth Day summit, heralding a US return to the climate frontlines amid mounting worries over the rapid heating of the planet. Green groups expect that Biden, who is pushing a green-friendly USD2 trillion infrastructure package at home, will roughly double US targets for slashing emissions responsible for climate change over the next decade. Biden hopes the new US goal will prompt other leaders "to make announcements to raise their ambition" as well, an administration official said. Japanese Prime Minister Yoshihide Suga on a visit to Washington last week indicated he was planning a new commitment.
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BROKER RATING CHANGES
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JPMORGAN CUTS SYNTHOMER TO 'NEUTRAL' ('OVERWEIGHT') - TARGET 540 (500) PENCE
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DEUTSCHE BANK RAISES ENTAIN PRICE TARGET TO 2090 (1872) PENCE - 'BUY'
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COMPANIES - FTSE 100
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Housebuilder Taylor Wimpey said the UK housing market has remained healthy in 2021, supported by continued strong customer demand, low interest rates, good mortgage availability, and ongoing government support, particularly for first-time buyers. Taylor Wimpey said the transition into the next phase of Help to Buy "has progressed smoothly" and has experienced strong customer demand for homes under the new scheme. As at April 18, the total order book value stood at GBP2.81 billion, up from GBP2.67 billion at the same time last year. This represents 10,995 homes, up from 10,853 homes. Taylor Wimpey reiterated its operating profit margin target of 21% to 22% in the medium term. "Trading is in line with expectations and we remain on track to deliver against our guidance set out at our 2020 full year results in March," the company said.
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COMPANIES - FTSE 250
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Domino's Pizza Group said trading in the first quarter has been strong, with "exceptional trading over the new year period". For the first quarter to March 28, UK & Ireland system sales were GBP371.3 million, up 19% on the first quarter of last year. Domino's said sales performance of the delivery business has been "particularly good", more than offsetting the lower sales within the lockdown-hit collection business. At an order count level, Domino's said it has seen delivery growth of 6.8% in the quarter, with collection reporting some recovery, now trading at 65% of 2019 levels.
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The GBP2.3 billion takeover of Aggreko could be in doubt after its largest shareholder looks set to oppose the deal, Sky News reported late Wednesday. Liontrust Asset Management, which holds a 12% stake in Aggreko, has decided to vote against the deal, Sky said. Several other shareholders are said to have doubts about the price of the deal, Sky suggested. Focus will now be on Sprucegrove, the second-largest shareholder, which owns roughly 8% of Aggreko, although its voting decision was unclear on Wednesday. The deadline for investors to decide is Thursday. The deal is structured as a scheme of arrangement, meaning it requires 75% of voting shareholders to back it in order for it to complete.
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COMPANIES - GLOBAL
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Credit Suisse Group said the significant charge it took with respect to its recent hedge fund debacle sent it into loss in the first quarter of 2021. The Swiss bank reported net revenue growth of 31% year-on-year in the three months to March 31 to CHF7.57 billion - about USD8.23 billion - but said it swung to a pretax loss of CHF757 million from CHF1.20 billion income. On an adjusted basis, excluding significant items and the US-based hedge fund hit - pretax income was CHF3.60 billion versus CHF946 million a year ago. Adjusted revenue was 35% higher year-on-year at CHF7.43 billion. "Our results for the first quarter of 2021 have been significantly impacted by a CHF4.4 billion charge related to a US-based hedge fund. The loss we report this quarter, because of this matter, is unacceptable," said Chief Executive Thomas Gottstein. Credit Suisse racked up more than USD20 billion in exposure to Archegos-related investments, the Wall Street Journal reported late Wednesday, and the Swiss bank's executives were only told days before the US hedge fund's implosion.
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Nestle said revenue growth in the first quarter of 2021 was slowed by the strength of the Swiss franc. The Vevey, Switzerland-based food and drink company said sales increased by 1.3% to CHF21.1 billion in the three months to the end of March. Organic revenue growth reached 7.7% year-on-year. Nestle noted that foreign exchange reduced sales by 5.3% due to the continued appreciation of the Swiss franc against most currencies. Meanwhile, pricing increased to 1.2%, reflecting input cost inflation. By category, the company said Coffee was the largest contributor to growth, fuelled by strong demand for Nespresso, Nescafe and Starbucks products. Dairy grew at a double-digit rate, based on elevated demand for home-baking products and fortified milks.
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Thursday's Shareholder Meetings
Aggreko PLC - AGM
Alliance Trust PLC - AGM
Bidstack Group PLC - AGM
CLS Holdings PLC - AGM
Dignity PLC - GM re proposal to remove Clive Whiley as executive chair
Domino's Pizza Group PLC - AGM
Foxtons Plc - AGM
Ibstock PLC - AGM
GLI Finance Ltd - EGM re tender offer for ZDP shares
JPMorgan Claverhouse Investment Trust PLC - AGM
National Grid PLC - GM re PPL WPD acquisition
RELX PLC - AGM
RIT Capital Partners PLC - AGM
Segro PLC - AGM
SThree PLC - AGM
Taylor Wimpey PLC - AGM
Tullow Oil PLC - AGM
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By Tom Waite; thomaslwaite@alliancenews.com
Copyright 2021 Alliance News Limited. All Rights Reserved.
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