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Preliminary Results Presentation 12 months to 31 December 2003

Preliminary Results Presentation 12 months to 31 December 2003. Agenda. Preliminary results Operational highlights Financial highlights Divisional highlights Track record Highlights since flotation 7 year record Current trading and outlook The investment case Appendix Company history

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Preliminary Results Presentation 12 months to 31 December 2003

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  1. Preliminary Results Presentation12 months to 31 December 2003

  2. Agenda • Preliminary results • Operational highlights • Financial highlights • Divisional highlights • Track record • Highlights since flotation • 7 year record • Current trading and outlook • The investment case • Appendix • Company history • Strategy • Revenue and profit bridge • Revenue by division and by source

  3. Operational highlights • Good performance despite brutal market conditions • Robust performance from market leading brands • Swift integration of Risk Waters • Leading position in general insurance market reinforced with the acquisition of Insurance Age • Acquisition of outstanding 50% in DWT Conferences Ltd • Continued organic growth by launching new titles - Wealth, US Credit and other brand extensions

  4. Financial highlights • 46% increase in turnover to £35.37m • 61% increase in profit before goodwill and tax to £6.65m, after non-recurring rationalisation costs • Operating margin improved to 23.3% from 18.8% • 24% improvement in diluted earnings per share to 6.62p • Final dividend of 1.0p, giving 28% increase in total dividend for the year to 1.60p

  5. Financial highlightsProfit and loss account - operations

  6. Financial highlightsProfit and loss account - financing

  7. Financial HighlightsProfit and loss account – performance per share

  8. Financial highlightsBalance sheet

  9. Financial highlightsCash flow

  10. Divisional structureFive core divisions Retail Investment Insurance Risk Management Mortgage Financial IT/ Market Data Investment Week International Investment IFAOnline Bloomberg Money Multi Manager Protected Investments Your Money Wealth Post Reinsurance Professional Broking Cover Insurance Age Insurance Window Risk Asia Risk Credit Energy Risk Operational Risk Hedge Funds Review US Credit Your Mortgage Mortgage Edge Mortgage Solutions Your Mortgage.com Incisive Communications Waters Trading Technology Week Inside Market Data FX Week Hedge Fund IT DWT Risk Waters Group Incisive Media Photographic British Journal of Photography

  11. Divisional highlights Retail investment(£10.1m 29% of group revenues (2002:46%))Key brands: Investment Week, Multi-Manager, Bloomberg Money • Revenues for the division declined by 9% • Despite a fall in advertising of 17% • Events revenue up 7% • Investment Week NordicEuropean Forum • Growth opportunities through new brands • Launch of Wealth and new research product Incisive Research • Strengthening of positions in markets

  12. Divisional highlightsInsurance (£7.4m 21% of group revenues (2002:27%))Key brands:Post, Insurance Age, Professional Broking, Reinsurance • Like for like revenue improved by 9%, total improvement of 16% • Boosted byacquisition of Insurance Age, full benefits to be seen in 2004 • Good performance from Post Magazine • Successful extension of brands through creation of new platforms • Like for like event revenue up 27% • Good progress in other parts of the division • Re-launched Reinsurance revenue up 31% • Revenues for Professional Broking up 41%

  13. Divisional highlightsRisk management (£10.9m, 31% of group revenues)Key brands:Risk, Credit, Energy Risk, Hedge Funds Review, US Credit • Difficult first half, but real recovery in 4th quarter with record advertising revenues for Risk • EPRM re-launched as Energy Risk - outlook encouraging • Hedge Funds Review’s revenue up 38% • Launched delegate paid conference • Launched US Credit

  14. Divisional highlightsMortgage (£4.3m 12% of group revenues (2002:19%))Key brands:Your Mortgage,Mortgage Solutions, Mortgage Edge • Magazine brands revenue, including events, up 8% • Total divisional revenue declined by 6% • Due to loss of specialist publishing contract • Strong growth from Mortgage Solutions • Publication revenue up 24% • Events revenue up 50%

  15. Divisional highlightsFinancial IT and market data(£1.5m, 4% of group revenues)Key brands:Waters, Inside Market Data, FX Week • Revenues for IMD and FX Week strong in last quarter • Encouraging signs of further recovery with Waters return to profitability forecast in 2004 • Photographic(£1.1m, 3% of group revenues (2002: 4%))Key brand: British Journal of Photography • 4% increase in revenues

  16. Swift integration of Risk Waters Group • Annualised cost savings of ~£1.5m, higher than anticipated • Office move – completed 24th May • Production • Personnel • Business fully integrated • Merged accounts, marketing, personnel, IT and online departments • Rationalisation cost approximately £314k (H1 - £100k) • Full benefits to be seen in 2004

  17. Highlights since flotation • Turnover doubled from £16.5m to £35.4m • Increased diluted earnings per share before goodwill by 85% to 6.62p • Improved operating margins from 15.7% to 23.3% • Achieved during a major downturn in the advertising cycle • The performance is a testament to the quality of our brands and our staff who have implemented the strategy that we adopted at the inception of the group in 1994

  18. Revenue change by source 2003 2000 £35,365,000 £16,582,000 Advertising Subs & other publication Events Internet and other revenue

  19. 7 year track record

  20. Current trading and outlook • Advertising revenue recovery • Positive growth in all divisions • The group is continuing to expand organically • Wealth, US Credit, IncisiveResearch and range of conferences and events • Highly geared to recovery • Will receive the full year benefits of cost savings introduced in 2003 • Well positioned to make more acquisitions

  21. The investment case • Superior industry margins of 23% with future growth • Each division headed by robust brand leader • Excellent organic growth track record with a proven business model • Launched 16 new magazine brands in 9 years • Low risk events model • Events are domestic with limited exposure to international travel • Highly geared to advertising recovery • 46% of revenues from sponsorship and advertising ahead of peers • Well positioned to make more acquisitions • Management team has a proven track record of swiftly integrating acquisitions • Nine years of unbroken EPS growth

  22. Appendix

  23. Corporate history • City Financial Communications established in 1994 • Company re-branded as Incisive Media in July 2000 following the acquisition of Timothy Benn Publishing Group • Incisive Media floated in December 2000 • Matching Hat acquired in August 2001 • Acquired Risk Waters for £35.1million in May 2003 • Acquired Insurance Age for £1.05million in July 2003 • Acquired final 50% of DWT Conferences December 2003

  24. Incisive Mediastrategy • To provide the preferred media for companies to communicate effectively with their target audience through a variety of platforms • To be the preferred source of information in our chosen markets • To apply the business model to growth sectors • Apply market focused approach to developing brands • “Slice and dice” to deliver key information to defined target audiences • Extend brands across a variety of platforms • Develop close relationships with both buyers and sellers of products to maintain preferred channel status • To respond to new market opportunities and develop valuable brands in those markets • To make value enhancing acquisitions that will accelerate our growth and complement existing brands

  25. Acquisitions criteria • Quality brands and assets with strong market positions • Serving growing vertical industry sectors • Robust earnings from the core assets • Earnings enhancing in the short to medium term

  26. Future growth strategy • Growth through the application of a proven business model • Extend the brand to a variety of platforms • Conferences Forums Awards • Exhibitions E-Mail alerts PDF Bulletins • Training Research Data and information sales • Launch new magazine brands • Specialist publishing and contract event management • Cyclical upside from advertising recovery – high operational gearing • By acquisition • Good cash inflow • Strong balance sheet • Ability to manage acquisitions

  27. Financial highlightsOperating revenue bridge

  28. Financial highlightsOperating profit bridge

  29. Divisional highlightsRevenue by source 2002/2003

  30. Divisional highlightsRevenue by division 2002/2003

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