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Interim Results

Euromoney adjusted pre-tax profits fall

19 May 2016 09:40

Euromoney Institutional Investor's adjusted profit before tax fell by 12% to GBP47m in the six months to the end of March.

it said the first-half results reflect, as expected, the continuation of the headwinds experienced in the second half of last year.

Total revenue for the period fell by 2% to GBP194.2m. Underlying revenue fell by 4%, and by 6% after adjusting for event timing differences, consistent with the trend experienced since the start of the second half of 2015.

Underlying subscription revenues increased by 1% in the half, although the rate of growth in the second quarter was less than 1% compared to 2% in the first quarter. This reflects some tightening of budgets in the asset management sector since the start of the calendar year. Institutional Investor's memberships continue to perform strongly with double digit top line growth, while both BCA and NDR are showing signs of returning to growth after a challenging 2015. Underlying advertising fell by 13% and underlying event revenues by 7% (by 12% excluding a biennial event) reflecting a further deterioration in the energy sector and commodity markets. This weakness in energy dependent economies (including Saudi Arabia, Nigeria and Indonesia) has had a knock-on effect on banking and capital market activities in those areas, particularly in events and training.

Many of these businesses were included in the bottom left quadrant at the recent Investor Day, and the significant drag on the first half results is illustrated by the fact that revenues from the businesses in the bottom left quadrant fell by 27% in the period and contributed nearly 70% of the decline in total revenue.

Chief executive Andrew Rashbass said: "The first-half results continue to reflect the headwinds we saw in the second half of last year and revenue and profit declined as expected in line with last year's second-half trends. We are beginning to implement the new strategy we presented in March, for instance in launching new products, actively managing the portfolio and in how we price our products. Early signs of its impact are encouraging. Although headwinds remain for us and our customers, the progress we are seeing gives us some confidence in the outcome for the full year."

At 9:40am:

(LON:DMGT) Daily Mail and General Trust PLC share price was -8.75p at 718.75p

(LON:ERM) Euromoney Institutional Investor PLC share price was -14.75p at 980.25p

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