BONH.L Regulatory News (BONH)

29 June 2020

Bonhill Group plc

("Bonhill", the "Company" or the "Group")

AGM Statement

and

Directorate Changes

AGM Statement

Bonhill Group plc (AIM: BONH), a leading B2B media business specialising in three key areas: Business Insight, Events and Data & Analytics, is holding its Annual General Meeting later this morning ("AGM"). In order to comply with the UK Government's COVID-19 measures which restricts, amongst other things, public gatherings of people, the AGM is being convened as a 'closed meeting' with a quorum of two and other shareholders will not be permitted entry on the grounds of safety. 

The Company provides the following statement ahead of the AGM:

"We are pleased to announce that the Group is trading marginally ahead of the Board's expectations released on 9 April 2020, as it continues to work remotely to deliver its global capabilities. The safety of the Group's staff remains a key priority and currently we are not expecting anyone outside of the Hong Kong office to return to their workplace until September 2020 at the earliest.

The impact of COVID-19 has meant that any revenue originally planned from Events has no longer been achievable and therefore the Company has been trading solely on its digital and data revenues. In order to mitigate the impact of this, in the first half of the year, the Company has undertaken a range of cost saving initiatives, including a redundancy programme across all of the regions in which it operates, the use of the furlough scheme in the UK and a reduction in other overheads. Overall, these measures have reduced headcount by 13 and resulted in annualised savings in the Company's fixed cost base of £1.8m.

Our cost-saving initiatives, flexible adaptation to evolving market conditions and a forward-looking approach to customer solutions were, as previously announced, designed to deliver approximately £20 million of revenues and a small positive EBITDA contribution in the year ending 31 December 2020. Given current trading, further details of which are set out below, the Board currently expects to deliver a small improvement on that position for the year.

The Company has also been focusing in Q2 on improving its working capital position, reducing debtors by approximately £2.0 million and collecting approximately £1.6 million of cash. At 25 June 2020, the Company had a cash balance of approximately £3.8 million, reflecting the receipts from both the net proceeds of the recent equity fundraising (£2.3m) and the previously announced US Paycheck Protection Programme ("PPP") ($1.1m). The Company's application for forgiveness of the PPP loan will be made in the second half of the year which, if successful, is expected to result in $0.9 million of the original $1.1m being forgiven. The PPP requires US staff numbers to be maintained, and therefore replaces the Company's previously planned US payroll cost savings. In addition, the Company has made an application for a UK Coronavirus Business Interruption Loan Scheme ("CBILS") loan with its principal bank.

Current Trading

The business has continued to see good levels of activity in each of its major markets.

Our US Business is trading ahead of its revised forecast with Q2 revenues up by approximately 20% on Q1. US digital, in particular, is currently trading 29% ahead of its Q2 forecast. The US Business expects to see a reduction of only 20% in year-on-year sales with $5.0 million of sales required to hit the year's forecast. This looks to be achievable given the current pipeline. There is an encouraging level of activity in the US asset management and financial advisor markets which bodes well for the US Business' performance in the second half of the year.

In the UK, Last Word Media's non-event revenues in the year to May are only down 7% on last year with strong performances from Last Word Create, the new content marketing solutions brand, ESG Clarity and Portfolio Adviser. In Last Word Media Asia, digital revenues in the year to date are up 20% on 2019. The majority of Last Word Media's (and the Group's) Events have been rescheduled either to a virtual format or to later in the year. In total, since the start of 2020, 52 events have been cancelled, 35 events have moved to a virtual format and 18 new virtual events have been organised. The current expectation is that only small live events (less than 30 attendees) will be held and only in the final four months of 2020. Many of these have been moved to venues outside central London to enable easier travel and social distancing protocols to be observed. Last Word Media has total booked orders so far this year of £5.4 million with another £2.9 million required to achieve its annual sales forecast.

The Company's UK Media assets, comprising Small and Growth Business, What Investment, Growth Company Investor and Information Age, have continued to see a strong performance in the first six months of the year. They have already booked orders in excess of 2019's totals and have achieved their original, pre-COVID-19, Q1 and Q2 budgets. The business unit is on track to deliver its full year budget with current booked orders equating to 87% of its annual budget. Its strength has been due to a broader customer base and the adoption of a wider range of products away from a previous reliance on events and digital revenues. This successful template of transitioning to a customer focused solutions provider will be rolled out across the rest of the Group in the second half of the year.

Bonhill Diversity has seen the largest impact of COVID-19, being principally an events-led operation. We have cancelled all large-scale events for the remainder of the year with the exception of Women in IT, Singapore which is scheduled to take place in November. We have moved two awards into a digital format and have maintained the presence of this key brand with nine virtual summits due to be held during the second half of the year across three continents. There remains continued support for the Women in IT and Women in Finance brands. The brand's 2020 budget has been reduced by 55% and is currently at 85% of the revised budgeted sales.

Operationally, the Group's employees continue to work remotely with great success and this period has seen many internal process improvements, a far greater degree of international collaboration and the sharing of best practice. The investments we have made in the technology platform have enabled a stronger performance from our digital assets and we have seen on average a 15% improvement in audience numbers in our core brands in the three months since lockdown began. This period has also enabled us to finalise some of our major infrastructure projects and we will complete our Group wide CRM project by September 2020.

We recognise the ongoing risk that the pandemic creates, not least the potential risk of a second spike in key regions, but our diverse geographic exposure, reduced cost base and new virtual capabilities will help to mitigate that. Despite all of the ongoing uncertainty, we look forward to providing a further update at the time of the release of the Company's interim results in mid-September."

Directorate Changes

The Company also announces that Fraser Gray, Non-Executive Director of the Company, has resigned as a director of the Company with effect from the conclusion of the AGM.

The Group is pleased to announce the appointment of Jon Kempster as a Non-Executive Director with effect from the conclusion of the AGM. Jon will assume the role of Chair of the Company's Audit Committee and will also join the Remuneration and Nomination committees.

Jon is currently a Non-Executive Director and Audit Committee Chair at Ted Baker plc and Redcentric plc and is a Trustee of the Delta plc pension scheme. His career has included Board positions at Delta plc, Fii Group plc, Linden plc, Low & Bonar plc, Frasers Group plc, Utilitywise plc and Wincanton plc. Jon qualified as a Chartered Accountant with Price Waterhouse in 1990 and has a BA (Hons) in Business Studies from the University of Liverpool. Further information in accordance with paragraph (g) of Schedule Two of the AIM Rules for Companies is set out below.

Neil Sachdev, Non-Executive Chairman of Bonhill, commented: 

"We are delighted that Jon is joining the Board following today's AGM. He brings with him a wealth of relevant public company experience.

"I would also like to take this opportunity, on behalf of the Board, to thank Fraser for his counsel and contribution to the Board's deliberations during his time at the Company. We wish him well for the future."

For further enquiries please contact:

Regulatory disclosures (in accordance with Rule 17 and Schedule Two paragraph (g) of the AIM Rules for Companies)

Save for the information set out above and below, there are no further disclosures to be made in accordance with Rule 17 and Schedule Two paragraph (g) of the AIM Rules for Companies in respect of the appointment of Jonathan "Jon" Kempster, aged 57. Mr. Kempster does not hold an interest in the Company's share capital.

Current Directorships

Delta Pension Nominees Limited

Portcentric Solutions Limited

Redcentric plc

Ted Baker plc

Past Directorships (within 5 Years)

Beardsley Realisations 1 Limited (Previously Energy Information Centre Limited)

Beardsley Realisations 2 Limited (Previously T-Mac Limited)

Broadfern Properties Limited

Eco Monitoring Utility Systems Limited

EIC Energy Trading Limited

Frasers Group plc

JVM AG

JVM Equipment International Limited

JVM Limited

Proposed Solution OU

Republic.com Retail Limited

South Quayside Holdings Limited

Sportsdirect.com Retail Limited

The Bowling Back Land Company Limited

The Flannels Group Limited

Utilitywise Franchising Limited

Utilitywise plc

About Bonhill Group plc

Bonhill Group plc is a leading, AIM-quoted, B2B media company providing Business Insight, Events and Data & Analytics propositions to Financial Services, Diversity and Technology business communities in 25 countries. Bonhill operates fifteen information websites, publishes four regular print titles, hosts 120 events per annum, offers a portfolio of data & analytics propositions and provides a range of content marketing solutions.

The business creates content, sales and marketing opportunities, networking events and transactional opportunities for its audiences of entrepreneurs, business owners and managers, CTOs & technology leaders, asset & wealth managers, and professional women, in addition to its sponsors, advertising clients and customers. Flagship brands include: InvestmentNews, Portfolio Adviser, Fund Selector Asia, What Investment, SmallBusiness.co.uk, GrowthBusiness.co.uk, Information Age, Women in… events series, and DiversityQ.

For more information visit www.bonhillplc.com