Last checked at 4 Nov 2020 07:00
4 November 2020
Wilmington plc
('Wilmington' or 'the Group')
Trading Update
Wilmington plc, the provider of data, information, education and networking services in Risk & Compliance, Healthcare and Professional knowledge areas today announces an update on trading for the three months to 30 September 2020. This statement is being made ahead of its Annual General Meeting ('AGM') which is taking place later today. The AGM is taking place as a closed meeting due to the restrictions imposed in response to Covid-19.
Trading Update
The Board is pleased to announce that financial results for the quarter have been encouraging and were ahead of management's previous expectations. Adjusted PBT was ahead of the corresponding period in the last financial year despite revenue being down around 6% on an underlying basis at constant currency due to the inability of the Group to run face-to-face training and events in the period.
The Group's Preliminary Results announced on 17 September 2020 demonstrated the extent to which the digital transformation of face-to-face events and training to virtual formats had been successful. The speed with which this transformation was delivered helped to mitigate a significant element of the potential first quarter revenue impact from Covid-19. Decisive action to reduce costs has also continued - the savings in direct costs as a result of this transition were augmented by an overhead reduction exercise that was undertaken over the summer resulting in the improved year-on-year profitability.
Each of the Group's three divisions has seen trading ahead of internal expectations. Notable performances were seen in our core subscription-led data businesses, which make up around 50% of Group revenues and which have continued to hold up well during the pandemic. Additionally, in Compliance, ICA Singapore has seen good registrations for new qualifications and in Professional, the investment banking training business was able to convert its summer intake programme to virtual formats and hence deliver revenue in line with the prior year.
Cashflow in the quarter was also better than previously expected with net debt as at 30 September 2020 of £28.0m (30 September 2019: £41.2m). In October, to secure its headroom, the Group extended by twelve months the term on its existing £65.0m revolving credit facility by exercising the pre-existing option that it had to do so. The facility will now expire on 3 July 2024.
Outlook
Following the strong first quarter trading performance the Group is on track to at least achieve the expectations for the half year that it set out in the Preliminary Results announcement on 17 September 2020. This is for revenue and profit in the first half to be in line with that achieved in the second half of the year to 30 June 2020.
Predictions for second half performance remain difficult at this current time due to the uncertainty over the extent to which the Group will be able to run face-to-face events in that period. Recent lockdowns and developments globally in the spread of Covid-19 are likely to delay the resumption of face-to-face activities and it is not possible to say at this stage when that resumption will be. The Group is currently in active discussions with customers over its key H2 events such as RISE National and is considering all alternatives around format and timing.
In the Preliminary Results announcement we set out a range of potential outcomes for H2 depending on whether or not we could run face-to-face events and training. Recent trading experience leads us to believe that a fully virtual H2 would deliver better revenue and profitability than we guided to at that time as the lower end of the potential range. So whilst the chances of that scenario occurring have increased in recent weeks as the pandemic has developed, we feel increasingly confident in our ability to mitigate some of the associated financial effects of that potential outcome.
The Group plans to announce its Interim Results for the six months ended 31 December 2020 on Thursday 18 February 2021.
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement this inside information is now considered to be in the public domain.
For further information, please contact:
Wilmington plc 020 7490 0049
Mark Milner, Chief Executive Officer
Richard Amos, Chief Financial Officer
FTI Consulting 020 3727 1000
Charles Palmer / Dwight Burden / Emma Hall / Debbie Oluwaseyi Sonaike
Notes to Editors
Wilmington is the recognised knowledge leader and partner of choice for data, information, education and networking in Risk & Compliance, Healthcare and Professional areas. Wilmington employs close to 1,000 people and sells to around 120 countries. Wilmington plc is listed on the main market of the London Stock Exchange.