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UPDATE 2-Events firm Informa deepens cost cuts as pandemic drives loss

Mon, 21st Sep 2020 08:02

* Posts H1 COVID-19 impairments of nearly 600 mln stg

* H1 adjusted revenue, profit beat analysts' view

* Sees FY revenue of about 1.7 bln stg
(Adds CEO comments, background)

By Yadarisa Shabong

Sept 21 (Reuters) - Britain's Informa announced
further cost-cuts, including layoffs and office closures, to
ride out the pandemic that has kept the events industry in
Europe and North America effectively closed and pushed it to a
half-year loss.

The world's largest exhibitions group, with around 11,000
employees mostly in the United States, Britain and China,
reported an operating loss, including exceptional items, of 740
million pounds ($958.89 million) down from a profit of 248.3
million pounds last year, hit chiefly by COVID-19 impairments
amounting to 592.9 million pounds.

The London-based company, whose shares have sunk 45% since
March, said a combination of lower costs and effective cash
management would make it cashflow positive on a monthly basis by
January next year.

Revenue is seen at about 1.7 billion pounds this year, down
from the 2 billion pounds it expected earlier, Informa said.

As part of its plan to save an additional 200 million pounds
by the end of 2020, Informa said it would lay off staff in North
America and Europe, the Middle East and Africa.

CEO Stephen Carter did not say how many jobs would go, but
added that about 5% of the cost-savings would come from
compulsory redundancies, while the rest were from venues,
marketing, compensations costs, among others.

Due to the delay in reopening of events in markets outside
Mainland China, Informa said it has extended its programme to
reschedule physical events to mid- to late-spring of next year.

"We think that has the benefit of getting us the other side
of winter ... and also it moves the business the other side of
the American presidential elections," Carter said.

Many analysts believe the events industry has already hit a
bottom this year though some have warned that as long as
business travel remains subdued, the first half of 2021 would be
bleak.

On an adjusted basis, Informa reported operating profit of
118.6 million pounds on revenues of 814.4 million pounds,
beating average analysts' expectations of a profit of 68.6
million pounds on revenues of 759.9 million pounds.

Shares in the FTSE 100 company were down nearly 3% as of
0903 GMT.

($1 = 0.7717 pounds)
(Reporting by Yadarisa Shabong in Bengaluru, editing by Louise
Heavens)

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