WHEN PEOPLE COME TOGETHER...

Annual Report and Accounts 2017 …INCREDIBLE THINGS HAPPEN. In a digital world, the value of connecting on a meaningful human level has never been more important. Incredible things happen when people come together, interact and inspire one another. Either at our events or within our communities. UBM is the world’s leading ‘pure-play’ organiser of business-to-business (B2B) events across the globe.

In this year’s report Strategic Report Governance Report Financial Statements Key Highlights 01 Board of Directors 47 Independent auditor’s report Chairman’s Statement 02 Corporate Governance Report 50 to the members of UBM plc 92 At a Glance 04 Nominations Committee Report 52 Financial Statements 100 Market Context 06 Leadership 56 Section 1: Basis of Preparation 105 How We Create Value 10 Effectiveness 57 Section 2: Segment Information 108 Our Strategy to Maximise Audit Committee Report 61 Section 3: Operating Profit and Tax 110 Value for Shareholders 12 Directors’ Remuneration CEO Overview of the Year 13 Report 68 Section 4: Financial Position 117 The Executive Committee 21 Directors’ Report 87 Section 5: Capital Structure and Financial Policy 126 KPIs 22 Section 6: Acquisitions Sustainability Report 24 Throughout this document, and Disposals 138 non-IFRS measures are noted Risk Management 30 Section 7: Employee Benefits 144 Principal Risks 32 with an (*) and additional information on these measures Section 8: Other Notes 151 Operating and Financial Review 36 is set out on page 170. The Board, has assessed this Additional Information 159 report and considers it, taken UBM plc parent company as a whole, as fair, balanced financial statements and and understandable. related notes 160 ACHIEVE YOUR AMBITIONS At UBM, our deep knowledge and passion for your industry allow us to create personalised environments which enable you to succeed. You’ll build relationships, you’ll close deals, you’ll grow your business. You’ll leave energised, inspired and excited about your future.

>90K >850 days The number of exhibitors The number of days we support every year of inspirational UBM events people can attend

CPhI China Matches Buyers and Sellers The CPhI Buyers Sourcing Event, like many at UBM, upgrades the event experience with precise pre-matching services, helping pharmaceutical sellers and buyers meet. With scheduled meetings, exhibitors and visitors have more interaction, more efficiency and close more deals onsite. The other days of the year, customers connect online; the related website is expanding, with engagement from key buyers like Bayer and Novartis. Statistics for this seven-year-old, China-based event illustrates the power of connecting the right people:

Number of Visitors: +14% “Thanks for arranging meetings with Number of Overseas Visitors: +12% good suppliers. We really appreciate Number of Exhibitors: +4% your whole-hearted efforts for Number of Products Online: +103% Chinese suppliers and Indian buyers”

Jagdish Parikh Bimal Pharma Pvt. Ltd BUILD RELATIONSHIPS AND CLOSE DEALS Our world is changing at an ever-increasing rate – it’s important that people are able to identify the changes, share ideas, learn and stay relevant.

Game Developers Conference Connects a Tribe Like a great film, a good video game needs a fully-developed world, gorgeous imagery, inspiring music, stirring characters, interesting interactions, multiple points of view and a compelling narrative. It’s a full art form with dedicated, passionate creators who descend on San Francisco in an annual pilgrimage to UBM’s Game Developers Conference (GDC) to connect, celebrate, and learn at an event uniquely shaped to their needs. For example, in addition to the usual name tag banners, 2017 GDC attendees could decide to self-identify for the week as He/Him, She/Her, or They/Them. UBM lets game developers be… well, game developers. All that audience empathy means loyalty.

Attendees at GDC 2017: 26,000 “GDC remains essential for Conference pass price: $799–$2,399 people in the industry to learn Completed meetings scheduled with our and make contacts” matchmaking service: 2,546

Tom Olson Director, Graphic Research at ARM

>3.4m >70k The number of people delegates paying to who visit UBM events attend UBM events each year SHARE IDEAS AND LEARN We recognise that people and experiences can provide inspiration. At UBM we seek to inspire people to be the best of themselves – professionally and personally.

“It’s immensely rewarding to work for a company that cares about communities and supports staff who want to seek out creative solutions”

UBM India Feeds the Hungry Pramod Dhavan works in HR in UBM’s Mumbai office. But to some hungry kids, he’s a super hero. “Every year there are more deaths due to hunger than Aids, TB, and malaria together, and 40% of those deaths are in India,” he said. At the same time, UBM runs events where food often gets thrown away. After being inspired by his UBM-sponsored trip to One Young World, a conference that encourages business leaders under 30 to make a difference, Pramod worked with dozens of colleagues across UBM, to develop a food donation programme. It took six months of hard work in which he had to overcome logistical and regulatory challenges and, in March 2017, the first hungry children filled their bellies with uneaten food from a UBM event. Thanks to a solid partnership with Feeding India, “I believe that organisations like UBM we now make food donations from events a regular part of our business in India, and we are looking are a great example of a socially to expand the program across the business. responsible business and help achieve and contribute to United Nations’ Sustainable Development Goals”

Ankit Kawatra Founder of Feeding India INSPIRE SEE YOU THERE Key Highlights Strategic report – UBM delivered another year of Financial Highlights excellent strategic progress Revenue – Financial results show accelerating revenue growth, margin progression

£1,002.9m Governance +16.2% and EPS improvement 2016: £863.0m

– Successfully progressed the Adjusted underlying revenue* growth integration of Allworld and acquired

four bolt-on businesses +4.1% Financial statements +2.0% pts 2016: 2.1%

Adjusted operating profit* margin 29.3% +2.1% pts 2016: 27.2% Reported operating profit margin1 21.1% (2016: 17.7%)

Diluted adjusted EPS* Investment Case Page 12 53.4p +34.5% A strategy 2016: 39.7p – Continuing for growth Diluted reported EPS1 34.8p (2016: 20.1p)

Adjusted cash generated from operations* Page 06 Page 04 Leading position Diverse geographic in attractive and sector £295.0m +16.6% Events market exposure 2016: £252.9m

Full year dividend per share Page 13 Page 36 Attractive Improving financial profile performance 23.5p +6.8% 2016: 22.0p

Page 24 Page 25 ROACE* A leader in Passionate sustainability people 13.7% -1.0% pts 2016: 14.7%

1 Continuing Group only UBM Annual Report and Accounts 2017 01 Chairman's Statement

It is with personal sadness that I find myself responsible for this section of the Annual Report. Dame Helen Alexander was an exceptional leader and is deeply missed. She steered UBM through a time of significant change and we have continued to build on the strong foundations that Helen helped to lay. 2017 strategic progress With our clear and well understood strategy we have continued to make excellent progress during 2017 and the quality of the business has improved further. We have delivered on our commitment to accelerate underlying growth and generate further improvement in the margin. The integration of Allworld Exhibitions, We have continued to make excellent acquired in December 2016, is going to plan and we are confident of achieving progress with our Events First the 2019 returns that we set out when the acquisition was announced. strategy during 2017. The strategy is During 2017 we also made four new delivering value for our shareholders bolt-on acquisitions and disposed or rationalised 37 small, lower-growth and/ with another year of improved or lower-margin events and various unaligned OMS activities. financial performance. The Board’s In line with our strategy, operationally confidence in the outlook for the the business has continued to improve. We have made good progress on the business is reflected in a new dividend roll-out of our common CRM platform and adoption of a standard sales model, policy and a proposed 6.8% increase in the design and implementation of the Marketing Excellence model in the full year dividend. and towards the creation of a high performance culture.

Dame Helen Alexander (1957 – 2017) It was with a profound and deep sadness The review targeted senior women We will long remember and cherish that we learned that our Chairman, below the company board. This work Helen, a wonderful person who achieved Dame Helen Alexander, had passed away was a fitting legacy. so much but did so with a gentle on 5th August 2017 following a period humility and a fundamental kindness. As Chairman of UBM, appointed in of illness. May 2012, Helen had a strong focus on Helen had an extraordinarily successful good governance and doing business and diverse career. She was a passionate in the right way, forging strong and champion of diversity, in all its forms, constructive relationships with both of recognising its value to all businesses. the UBM CEOs with whom she worked. She was a prominent role-model She successfully re-shaped the Board for women in business. Her to ensure that it has the appropriate co-authorship of the Hampton- mix of skills and experience to help Alexander Review, alongside Sir Philip the business deliver its Events First Hampton, sought ways to ensure strategic ambitions. talented women at the top of business are recognised, promoted and rewarded.

02 UBM Annual Report and Accounts 2017 2017 performance In May Warren Finegold, the former Strategic report Key Board activities in 2017 Our financial performance has improved Director of Strategy and Business during 2017 with Group revenue of Development for Vodafone, was Strategy £1,002.9m, adjusted underlying revenue* appointed as a Non-Executive Director. −− Held two-day Board and Executive growth of 4.1%, a 2.1%pt improvement in Warren brings extensive experience in Committee strategy meeting Group adjusted operating profit* margin strategy and technology, as well as a covering the strategy, marketplace, and a 34.5% increase in continuing background in investment banking and trends and developments. Focused diluted adjusted EPS* to 53.4p. capital markets. on next five years and beyond. Governance The Board believes this is a strong Shortly before Helen’s passing, I assumed −− Held a two-day Board meeting performance. It has proposed a final the role of Acting Chairman, and on in Shanghai, meeting local dividend of 18.0p which brings the total 30 January 2018 was appointed Non- management, key venues and dividend for 2017 to 23.5p, a 6.8% Executive Chairman. At that time Warren visiting a major event increase from 2016. Finegold was also appointed Senior Independent Director and Chairman of −− Regularly reviewed progress of the Sustainability the Remuneration Committee. Allworld Integration Sustainability remains an important tenet Governance −− Acquired four bolt-on acquisitions Financial statements of our business, which we regard as part I share Helen's commitment to ensuring People of our licence to operate from society. that the Board works effectively and −− Reviewed Group-wide 2017 talent We continue to play our part as a leader serves stakeholders as well as it possibly calibration exercise and succession in our industry in sustainability. can, across all areas of responsibility. process We sponsored UFI’s “Best Practice in To the right you can see a summary of −− Appointed a new UBM EMEA CEO Sustainability” report, which showcases the Board’s key activities in 2017. industry-leading sustainability initiatives. −− Reviewed performance of new On page 24 you can read more about our The Informa offer divisional operating models activities this year. On 30 January 2018, we announced (Sales Excellence and Marketing a recommended offer for UBM by Excellence) On gender diversity, we are making Informa PLC. After careful and thorough progress. Across the business over consideration, the Board believes the Governance 60% of employees are women; however terms of the offer recognise both the −− Appointed Warren Finegold to the only 27% of senior leaders are female. quality of our business and the strength Board and subsequently as Senior We have set a target to improve that of our future prospects, providing Independent Director and Chairman ratio to 50% by 2020. Good progress shareholders with attractive value as well of the Remuneration Committee has been made, for example with the as allowing them to participate in the appointment of Lucy Dimes as CEO, UBM −− Appointed Greg Lock as future growth opportunities provided by Non-Executive Chairman EMEA, and at the end of the year 37.5% the combination of Informa and UBM. of the Executive Committee were women. −− Regularly reviewed risk Addressing the under-representation of The process in relation to the women in the senior roles is a key part of recommended offer from Informa is Financial addressing the gender pay gap in UBM. ongoing at the point of publication of −− Approved 2016 full year results this Annual Report. Board changes −− Approved 2017 interim results We have refreshed the membership of the −− Reviewed and updated UBM’s UBM Board during the year. dividend policy I would like to thank Alan Gillespie, who stepped down in May having served as a Non-Executive Director since 2008. Alan has made a significant contribution Greg Lock to the UBM Board over the past nine Non-Executive Chairman years, having seen the Company through various key phases of its development and was an excellent Senior Independent Director.

UBM Annual Report and Accounts 2017 03 At a Glance

We are the world’s leading ‘pure-play’ organiser of business-to-business (B2B) events.

Using our deep …which bring the We promote knowledge and right business global trade passion for the people together and industries we serve enable them to make and commerce we craft personalised connections… between environments… businesses

We support businesses >350 176 >3.4m events ‘Major’ events visitors annually around the >£1m revenue p.a. globe

We have IndustryIndustry sector sector diversity diversity1 1 Fashion: 16.1% strong brands 11 Jewellery & Gem: 7.6% Sectors Lifestyle & Brands: 12.3% focused Advanced Manufacturing: 9.2% Pharma & Biochem : 11.3%

on growth Technology: 11.8% >250 Transport & Logistics: 4.2% sectors Food, Hospitality & Leisure: 10.6% Brands Business services & Infrastructure: 6.5% Life Sciences & Healthcare: 7.6% Resources: 2.8%

We employ the most >3,900 skilled and talented experienced people people Customer- Passionate centric

1 Total 2017 UBM Group revenue

04 UBM Annual Report and Accounts 2017 Strategic report

1 …helping them to Our focus is on bringing Revenue diversity* diversity achieve their business people together in Governance objectives and create person and we maintain value. a relationship with our customers year-round through integrated digital offerings and Stand revenue: 70% print products, where Attendee revenue: 8%

Sponsorship & other revenue: 9% Financial statements appropriate. Online revenue: 8% Print revenue: 5%

1 >90k >160 UBM Offices in Geographic diversity diversity* exhibitors different countries >20 participate in our events countries

USA/Canada: 41.8% UK: 6.1% Europe: 8.9% China (incl. HK): 25.7% Total Emerging Markets: 15.1%

Rest of World: 2.5%

Key brands

Collaborative Community- Bold Sustainable focused

UBM Annual Report and Accounts 2017 05 Market Context

UBM operates within the attractive global B2B Events market, which grew by c.4% in 2016 to c.$30.3bn. The market is forecast to continue growing at that level each year through to 2021.

A large and growing global market

The global B2B Events market grew expected to continue growing strongly at c.4% in 2016 to $30.3bn. This growth c.9%. Hong Kong, a more mature market was higher than 2015, driven primarily where growth is predominantly price by continued growth in the US and driven, expanded more modestly at c.2%, China. Growth in Emerging Markets also in-line with GDP growth. China and Hong recovered following its first major decline Kong combined represent c.9% of the in 2015. Venue expansions, especially in Global Events market. Emerging Markets, resulted in strong Most Emerging Markets are expected growth in global venue capacity of c.10% to continue to enjoy strong underlying in 2016. growth, notably ASEAN (and Indonesia There tends to be lower-growth in the specifically at +16%), the GCC (+9%), Global B2B Events market large, mature geographies which offer India (+11%) and Mexico (+9%). However, scale and market positioning, while the some markets continue to be impacted Emerging Markets offer more attractive by challenging economic conditions. faster-growth prospects but can also be Notwithstanding improvement since more volatile economically. 2015, Russia, Brazil and Turkey continued to decline through 2016 although they The US continues to be the largest have, more recently, shown early signs B2B Events market and at c. $13.2bn of improvement. represents c. 44% of the global market. Growth in 2016 was c.3% driven by Continental Europe remains a large

US: 43.6% moderate volume growth and pricing market and key geographies such as Emerging Markets1: 19.8% slightly ahead of inflation. Over the next France, Germany and Italy are forecast to Continental Europe: 14.4% five years growth is forecast to be ahead continue to show moderate growth. UK: 5.8% of US GDP growth at c.3% per annum. The global industry overall is expected to Rest of the World: 16.4% China, the second largest B2B Events grow at a CAGR of c.4% between 2017- 1 Includes Hong Kong. market in the world, remains attractive. 2021 assuming no significant change in Source: AMR Global: The global exhibition In 2016, the market grew at c.7%, ahead economic and geopolitical conditions. organising market: assessment and forecast to 2021 of China GDP growth, driven both by volume and price expansion. China is

06 UBM Annual Report and Accounts 2017 US B2B media mix 2017 forecast B2B Events deliver value in the b2b advertising Strategic report and marketing mix The B2B advertising and marketing This underpins the Events industry's industry is large and growing. In 2016, share of the marketing wallet. total US advertising and marketing spend Events are estimated to take a healthy grew 5% to $473bn (up from c.4% and resilient c.17% share of advertising historically) and is forecast to continue and marketing budgets in the US behind growing at around c.4%. Governance digital (c.54%) and alongside traditional B2B Events is one of the main channels print media (c.21%). History shows that

Digital: 54% companies use to market or source the Events channel has remained resilient Print: 21% products, to transact and trade. even as traditional mediums such as print Events: 17% have declined. The graph below, published by Outsell, TV/Radio/Cinema: 4% shows the importance of face-to-face in As the demographics alter there is Other: 4% delivering B2B marketers’ key objectives: evidence that the millennial generation of Source: Outsell Advertising and Marketing brand awareness and lead generation. marketing professionals highly rate and Financial statements Study 2017 are even more positive about Events than The graph illustrates the perceived their predecessors (as shown in the graph Total Advertising and effectiveness of different media channels on the following page). This underpins Marketing Spending in the US. Live events, (either conferences the future importance of Events in the and Growth $bn or tradeshows) are the highest ranked marketing mix. 4.6% non-owned media channels for generating 4.5% 5.0% leads and building brand awareness. 4.1% 4.5% 500

480 460 The effectiveness of different media to deliver 440 brand awareness and lead generation in the US 420 90% 400 Effectiveness at delivering Brand Awareness Company's websites 2013 2014 2015 2016 2017

Spending 80% Conferences Growth

Source: Outsell Advertising and Marketing Study 2017 70% Custom print Company's events Direct mail ABM Exhibitions & trade shows 60% Magazine ads Email Social media ads Own social engagement

50% Native advertising Public relations Sales collateral Mobile video Search advertising 40% Video Marketing research Print directories Webinars 30% Mobile ads Newspaper ads Sponsored content Banner/Display ads

Specialised 20% search Cinema

10% TV Radio

Effectiveness at Lead generation 0% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Source: Outsell Advertising and Marketing Study 2017

UBM Annual Report and Accounts 2017 07 Market Context continued

Millennial B2B marketers more positive about Events

US Marketer Attitudes Towards Events – 2017

69% 66% 66% 65% 67% 63% 63% 64% 61% 59% 56% 53% 54% 50%

Producers Positive Good Vendor Positive Easy to Key part of Critical to provide year- Sponsorship ROI support Exhibiting decide on how industry marketing mix round attendee (e.g. lead capture, ROI what to attend does business engagement apps social, etc.)

B2B Marketers Millennial B2B Marketers

Source: Outsell Advertising and Marketing Study 2017

Top five B2B Events Competition – A fragmented market, UBM well positioned organisers by revenue1 The global B2B Events market remains In Asia, UBM remains the largest fragmented. The top five organisers international B2B Events organiser account for c.16% of the market while with leading positions in China (#1 the top ten organisers hold only c.21%. international organiser), India and ASEAN. UBM is the largest listed 'pure-play' events These positions were strengthened business in the world and has continued through the acquisition of Allworld to strengthen its position through Exhibitions at the end of 2016. acquisitions and organic growth, with a In total, UBM generates c.44% market share of approximately 4.6%. of its Annual Events revenue in Reed Exhibitions: 5.6% UBM generates c.42% of its Annual Emerging Markets. UBM: 4.6% Event revenue in North America and is Messe Frankfurt: 2.3% the largest B2B Events organiser in the Informa: 1.8% US with a market share of 2.4%. Messe Dusseldorf: 1.5%

Other: 84.2%

1 As % of $25.3bn market analysed by AMR excluding Rest of World. Excludes Chinese government affiliated bodies CCPIT and CFTC. Source: AMR Global: The global exhibition organising market: assessment and forecast to 2021

08 UBM Annual Report and Accounts 2017 UBM operates in attractive growth sectors and geographies Strategic report

B2B Events are part of the commercial UBM’s Annual Events UBM’s Annual Events fabric of the industry sectors and Sectoral Exposure1 Geographic Exposure1 communities they serve. The performance of an events organiser is correlated to the health of the sectors it serves.

UBM operates across 11 sector categories, Governance each comprising multiple sub-sectors and communities. This breadth and depth of sector exposure provides resilience in the portfolio. Resources are deployed towards growth opportunities and accessing new Advanced Manufacturing: 10% North America: 42% fast-growth sectors. Business Services & Infrastructure: 5% China (inc HK): 29% The majority of sectors offer attractive Fashion: 20% Emerging Markets: 14% Financial statements growth potential based on favourable Food, Hospitality & Leisure: 8% Europe: 8% macro trends including, for example, the Jewellery & Gem: 9% UK: 4%

Rest of World: 3% growing, increasingly affluent middle Life Sciences & Healthcare: 4% class across Asia and India. The sectoral Lifestyle & Brands: 15% resilience is enhanced by the geographic Pharma & BioPharm: 12% spread biased towards higher-growth Resources: 1% American and Asian markets. Technology: 14% During 2017, UBM saw growth in Transport & Logistics: 2% every sector, except for Fashion and Life Sciences. For more detail about performance during the year see pages 36–38. 1 2017 Annual Events revenue

UBM Annual Report and Accounts 2017 09 How We Create Value

Using our skills, sector knowledge and data we deliver value to our customers and, consequently, our shareholders.

Our assets Why our clients value what we do

Our people Our c.3,900 people use their Sales and marketing skills and expertise to create excellence inspirational experiences We intimately understand ence ll e our customers’ needs to ce v Our data & relationships x en e t We know who is who in the sectors create propositions that g e n x we serve i p bring the right buyers, t e e r sellers, leaders and those k i r e n Our sector knowledge a seeking knowledge c m Our sector understanding allows us e

to craft content which is valuable to together +

its audience s

e

l a

Our market-leading brands S 90% of our Major events are the leading events in their sector/geography r e l s a ip t h Technology io rs ns ne We use technology to enhance the hips part operations of the business, improve the customer experience and provide actionable insight Relationships and partnerships Trusted partnerships We partner with the world’s We build and maintain trusted relationships with venues, suppliers leading cities, venues, and partners exhibition services providers and creative agencies to deliver more for our customers

Our Events First strategy drives performance and generates profit to reinvest in the business

Agile growth Customer insight Operational We actively manage and innovation excellence our portfolio through We focus on customer We continuously improve acquisitions, organic growth insight that enables us to all aspects of the way we and developing better serve and innovate to work, pursuing common events of high potential meet our customers’ needs approaches that enable our teams to become more efficient and effective

10 UBM Annual Report and Accounts 2017 Strategic report

The value we deliver Governance

Customers Event experience −− Grow their business We create fully-featured, −− Build relationships ence highly-valued experiences −− Build knowledge and skills ll e −− Connect with their communities ce ve for our customers to x n Financial statements e t −− Develop internationally g e meet, interact and trade n x i p t e – harnessing the power of Shareholders e r k i − Quality revenues and growth e face-to-face and digital − r n a −− Attractive margin c m e −− Cash generation

+

s

s −− Platform for acquisition

e e

l

l −− Dividend returns

a a

S S −− Clear strategic direction r People e l s −− Skills development a ip t h −− Career progression io rs ns ne − Reward performance hips part − −− Diverse and inclusive workplace −− Fun place to work

Partners −− Growth opportunities −− Innovations for the industry

Society −− Reduce environmental impact −− Local community engagement

Standardised High performance technology and data culture We underpin our business We invest in our people with common technology and organisational and standards to create capabilities so that we a scaleable global platform can deliver excellence for growth and performance for our customers

UBM Annual Report and Accounts 2017 11 Our Strategy to Maximise Value for Shareholders

Our vision: to be the leading global B2B Events business

We have chosen to focus on the We believe by executing on this strategy By executing across these five strategic attractive B2B Events market. As a we can drive industry-leading returns and priorities, we are now delivering on our market it is attractive because the experiences for our customers and deliver three strategic objectives: growth dynamics are good, B2B Events superior returns for our shareholders. −− Growth: accelerating our organic provide high-value to marketers and When we established the strategy growth rate; the competition is fragmented. we identified five strategic priorities −− Attractive margin: delivering to organise thinking and orchestrate Living Events First improvements in our margin; and activities. Three years later, we Our strategy of focusing on the B2B now implement the strategy in a − creating a global Events industry delivers the attractive − Best platform: multi-dimensional way across the operating platform to generate characteristics of the industry: organic strategic priorities. scale benefits when combined with growth (supported by acquisitions), high additional events businesses. margins and strong cash generation.

The world’s leading B2B Eventsevents company

Growth Attractive margin Best platform

Agile growth Customer insight Operational Standardised High performance We actively manage and innovation excellence technology and data culture our portfolio through We focus on customer We continuously improve We underpin our business We invest in our people acquisitions, organic insight that enables us all aspects of the way with common technology and organisational growth and developing to better serve and we work, pursuing and standards to create capabilities so that we events of high potential innovate to meet our common approaches a scaleable global can deliver excellence customers’ needs that enable our teams platform for growth and for our customers to become more efficient performance and effective

AttractiveAttractive market and market strong and UBM strong position UBM (see position pages 06-09)

The UBM Thecommitments UBM Commitments and sustainability and sustainability agenda (see agenda pages 24-29)

See our KPIs on pages 22–23

12 UBM Annual Report and Accounts 2017 CEO Overview of the Year Strategic report Governance Financial statements

UBM’s 2017 financial performance reflects the attractive characteristics of the Events industry, with good organic growth supported by acquisitions, high margins and strong cash generation.

Events First – A strategy Growth: In 2017 the adjusted underlying* benefit by leveraging the common Oracle which is delivering growth for the Group increased financials platform with harmonised and from 2.1% to 4.1%, driven by strong standardised management information. Since 2014, under the Events First growth in Events in China, India, South The increasing maturity of our platform strategy, the business has been reshaped East Asia and Continental Europe. enables efficient integration of bolt-on to focus on the attractive Events sector. Notwithstanding the challenges in the acquisitions and our newly opened Asia In 2017, the final year of that reshaping, Fashion sector, the adjusted underlying* shared service centre will provide further c.86% of revenues and c.94% of adjusted growth of the Annual Events portfolio support in this region. was 5.3% with underlying* growth at operating profit* (pre corporate costs) The progress against these strategic 3.6%. Biennial growth (on an adjusted were derived from Events. The remaining objectives was reflected in the reported underlying* basis) was 3.7% CAGR versus non-events businesses (Other Marketing results. Group revenues of £1,002.9m the last edition. Services – OMS) are held because they increased by 13.3% at constant currency, are closely aligned to industries served Attractive margin: During 2017 the adjusted operating profit* rose by £59.4m by our events portfolio or they are held Group adjusted operating profit* margin to £294.2m and adjusted operating for value. increased from 27.2% to 29.3%. This was cash flow* was strong at £295.0m, a While this reshaping of the business has driven by improved portfolio mix and the conversion of 100%. drop through from stronger underlying been taking place the strategic priorities Given the strength of performance the growth, together with procurement have been accelerating organic growth Board has declared a final dividend of savings and the usual margin benefit towards the average rate for the Events 18.0p which results in a full-year dividend of a biennial 'up' year. Operating cash industry (c.4%), expanding the operating increase of 6.8%. margin towards the Group’s medium-term conversion was 100%. target of 30% and on building an industry In the Operating & Financial Review on Best platform: The programme to pages 36–45 Marina provides further leading operating platform. implement a common sales model insight into the 2017 performance. enabled by Salesforce made good In 2017 the improvement in performance The sectoral and geographic spread of progress rolling out across EMEA and reflected good progress against these our portfolio, combined with its overall into Asia. The parallel process for the strategic objectives. scale, provides an inherent breadth and marketing model enabled with Eloqua, a resilience which underpinned the revenues marketing automation tool, has begun in and earnings in 2017. EMEA too. We continue to derive further

UBM Annual Report and Accounts 2017 13 CEO Overview of the Year continued

Enhancing the quality of the In January 2017 we completed We made four bolt-on acquisitions Events portfolio the Allworld acquisition, which during 2017 for £13.6m as detailed further strengthened our on page 43. The pipeline for Central to the Events First strategy market-leading position in Asia and has further acquisitions remains good, and since and to delivering the strategic secured a leadership position in the the year-end we have completed two objectives, is a focus on enhancing the high-growth ASEAN region. Right across acquisitions, Creativity in China and Canal quality of the portfolio: organically Asia and India the key macro driver of Energia in Brazil, for a combined initial (through improving performance), growth is an expanding and increasingly consideration of £9.6m. inorganically (through acquisition) and affluent middle class and it is this that 2017 was the final year of the by rationalising and/or disposing of provides a platform for long-term growth three-year programme to dispose underperforming events and non- for the business in Asia. aligned OMS activities. of or rationalise smaller, lower- Allworld's portfolio of large, market- margin, lower-growth events and OMS UBM's growth reflects, in large part, the leading events improved the overall activities that are not well-aligned health of the sectors we serve. We focus growth (and margin) profile of the Group to Events. on maximizing the growth performance and the high level of geographic and During the year we rationalised or disposed of individual events (or groups of events sectoral complementarity will allow strong of 37 events and various OMS activities – also known as Brands) and on improving revenue synergy generation, starting in which had generated £21.5m of Events the growth potential of the portfolio by 2018. The integration is progressing well revenue and £18.5m of OMS revenue in acquiring events in higher-growth sectors with performance ahead of the business 2016. This rationalisation programme has with a bias in favour of higher-growth case. The Return on Investment (ROI) enhanced the Group operating margin geographies. See Market Context on of 6.3% in 2017 is slightly ahead of our and contributed to Group operating profit. pages 6–9. expectations and we are confident of Since year-end we have disposed of a delivering on ROI greater than the risk- number of small media assets serving the adjusted WACC in 2019, as set out when US Fashion and UK Construction sectors. we announced the acquisition. In 2017 these contributed £7.5m of revenue to OMS and £0.9m to Events. Going forward, while we shall continue to review the portfolio to optimize it, we expect the level of rationalization to be lower and for it to reflect normal “cycling” of events. As such, we will no longer publish an adjusted underlying growth rate and focus on the underlying growth rate.

HOFEX Growth Exemplifies Benefits of Allworld Acquisition

HOFEX, Asia’s leading food and hospitality biennial tradeshow, has been bringing delicacies from all over the world to Asia for 30 years. HOFEX 2017 broke all previous records welcoming more than 2,650 exhibitors from 72 countries and regions. It also expanded to debut ProWine Asia – the leading international trade fair for wine and spirits. In aggregate HOFEX attracted more than 39,000 trade buyers including c.56% growth in buyers from South China which we had targeted, with support from UBM Sinoexpo. Overseas buyers grew by more than 17% with strong growth from Macao, “Allworld has Taiwan, Philippines and Korea. improved the overall profile of the Group”

14 UBM Annual Report and Accounts 2017 During 2017 we continued to This detail-driven approach now Events Adjusted Strategic report address performance at the extends to our event launches Underlying Growth* KPI individual event and Brand level. and in 2017 a more structured Events where growth rates are below launch process was implemented. acceptable levels are now held in the During the year we launched 21 new “spotlight” with incentives for those events, the largest being CPhI North +5.3% 2016: 3.1% responsible more closely aligned to their America which, exceptionally, reached improvement. Overall, the performance Platinum status (>£5m p.a.) in its of these “spotlight” events improved first year. Spend on bolt-on Governance during 2017. Overall 'Major' events (>£1m p.a.) acquisitions KPI Events in the Fashion sector, which generated 89% of Annual represents c.17% of the portfolio Events revenues. (proforma for Allworld and including all We focus on 'Major' events because £13.6m biennials), contracted by approximately 2016: £82.7m they tend to grow faster, deliver higher 4.9% reflecting structural change in the margins and are more resilient. In 2017 supply chain, away from wholesale to Financial statements both the adjusted and underlying e-commerce transactions. Revenues rationalised revenue* growth of these 'Major' events or disposed KPI The second iteration of our was 6% compared with portfolio average Event Plan process, by which all of 5.3% and 3.6% respectively. ‘Major’ events (delivering >£1m revenue p.a.) establish a strategy for £40.0m investment, growth and profitability over 2016: £19.8m the next three years, was further developed. Financial plans are a part of the Event Plan so that commitments can Annual Events revenue be tracked. from ‘Major’ events KPI At a divisional and Group senior management level an element of long- 89% term incentives are attached to the 2016: 86% revenue performance derived from the Event Plans.

CPhl North America Launch

CPhI is the leading marketplace for end-to-end pharmaceutical manufacturing and the Brand is already very well established, serving 100,000 professionals at events in Europe, Asia, and the Middle East. The extension into North America in 2017 was part of a geographic expansion strategy for the brand that has also seen launches in China, India, Korea and Japan. The strategy was to leverage audience from a much smaller event in an adjacent part of the market (Infomex), bringing the trusted CPHI brand to the North American market. Data, expertise and customer insight was drawn from the existing CPhI business and from the Life Sciences and Advanced Manufacturing brands which are strong in North America. Key results: −− 7,500 visitors versus goal of 6,000 −− >2,400 pre-scheduled meetings −− Sold out show floor with 630 exhibitors −− 75% of total exhibitor sales revenue was rebooked on-site for 2018 edition

UBM Annual Report and Accounts 2017 15 CEO Overview of the Year continued

Improving the operational These post show surveys are Since performance of the business complemented by additional engagement introducing with the industries we serve including Events First We continued work on improving topic specific surveys, focus groups and we have prioritised the Sales Excellence the operational performance of advisory boards. This allows us to innovate (SX) programme. During the year, we the business. and enhance the customer experience extended the adoption of our standard Significant improvement initiatives are and relevance of the event in a way which sales model (piloted and proven in EMEA) often multi-dimensional in nature and meets customers' needs – for example to Asia and planned for the roll-out in the connect the different strategic priorities as we have done with our Fashion events, Americas in 2018. detailed below. (identified when the Events First The SX programme comprises a strategy was launched – annotated using We also use reorganisation of the sales function, the icons.) customer insight to standardised training in line with a Customer insight, particularly price more effectively. standard sales model, as well as the post show surveys which Our approach to Value Based Pricing is roll-out of a common Salesforce measure Net Promoter Scores derived from an in-depth six-plus month CRM platform. insight process, which identifies the price (NPS) and Customer Satisfaction (CSAT) In 2017 a further 137 people in EMEA elasticity of customers for the products scores, are conducted at the end of every and in Asia joined the SX programme, as and services we provide. In 2017 we event and aggregated at the Brand, we extended the delivery of the model implemented it at Black Hat, the first time regional and Group level. As well as in EMEA and rolled-out in Turkey, Hong for an attendee based revenue stream. providing insight to the event leaders as Kong and Guangzhou. they revise their Events Plans it provides an early warning for 'spotlight' events which might need greater management oversight. The NPS and CSAT scores in aggregate improved in 2017 – as illustrated in the figures to the right.

Expansion of Fashion into Lifestyle Products Traditional, large format, brick-and-mortar retail in the US is facing challenges. In response to this, the Fashion team identified that retailers are extending their offerings beyond apparel into a broader ‘Lifestyle” offering. Accordingly the Fashion team now sells a 'Lifestyle' option – a branded experience including home goods, technology, and beauty products. In the face of market change, and to help customers respond, UBM’s Fashion events have innovated aggressively, using partnerships to ‘shift fast’. The Project Women’s event in Las Vegas, August 2017, included a 3,000-square foot marketplace featuring between 20 and 30 brands focused around apothecary, home, tech accessories and giftable items. The new area, from partner Coeur, helped educate retailers on what’s available and how to incorporate new product categories into their ready-to-wear and accessory lines. We also launched an educational series, in 2017 we introduced Value Based SWIMLESSONS, which has expanded its reach Pricing at Black Hat using live video streaming.

16 UBM Annual Report and Accounts 2017 Uplift in NPS – Visitors KPI Now 28% of Asia event revenues are The proportion of learning and Strategic report on the common CRM platform and this development (training) directed to will grow in 2018 as it rolls out further in improving capability in sales and +3.9pts Asia and the Americas. Detailed below marketing remains high at 69% 2016: +2.4pts you can see that in the EMEA business commensurate with the focus on the we are now seeing improvements in sales SX and MX programmes. effectiveness and efficiency. In parallel Uplift in NPS – Exhibitors KPI

As part of the SX programme, in EMEA with these Governance the sales organisation structure has been two projects changed to increase sales specialisation, we launched the Data Excellence (DX) +5.2pts improve sales leadership, to increase the programme. The aim is to significantly 2016: +21.3pts span of control and reduce the number of enhance the quality of the data we hold, organisational layers. which is the foundation of the actionable insight upon which our Events A similar Uplift in CSAT scores business relies. approach is – Visitors KPI Financial statements being adopted The DX team are focusing on enhancing to enhance marketing performance. the processes for collecting, storing, cleansing, connecting and enriching our +3.2% During 2017 we completed the planning data while respecting regulations and 2016: +1.8% for Marketing Excellence (MX) including privacy, including GDPR. a standard marketing model and selected Eloqua as the enabling technology. Uplift in CSAT scores In 2018 the roll-out of the marketing – Exhibitors KPI model and the automation technology +2.3% will begin in EMEA and Americas. 2016: +4.1%

Sales Excellence and Outcomes to Date The SX operating model establishes best-in-class standards across the global Group providing a platform for growth at scale. The success of the Sales Excellence model is already evident in EMEA, which began its transition in 2016 under Nina Wright, with accelerated organic growth, a reduced cost of sales and record new business generation. −− Since launch there has been a 15% improvement in efficiency for EMEA events on the platform −− As an example - for a specific show we saw: • 11% improvement in average monthly new business revenue year-on-year • 9% improvement in average monthly conversion rate year-on-year “Following on from the recent successes in EMEA, where we are seeing signs of growth, we expect to see improvement across the business as we normalise and build expertise in new ways of selling,” says Richard O’Connor, who leads the effort globally.

UBM Annual Report and Accounts 2017 17 CEO Overview of the Year continued

During the year the Board We have continued Additional people joined the approved a new technology to capitalise on the SX programme KPI strategy based on common benefits of the single standard platforms, partnering for Oracle ERP system. Business partnering non-critical applications and a shift with the finance function has improved in the proportion of spend towards with greater access to real-time 137 event technology. organisational data and insight. Building on the common platforms, the We have begun rolling-out the Asia Event revenues now running use of shared services has extended and, information technology target operating on common CRM platform KPI alongside the Allworld integration, a model to service and support the shared services centre for Asia was organization in a more effective and established in 2017. This will improve customer facing way. A new leadership the financial control in the region. 28% structure has been established and 2016: 0% changes to the technology organisation The procurement programme are now being implemented. The first generated further savings and outsourcing project will complete in 2018. secured another £3.7m of UBM Americas Event websites on annualised savings during 2017 to bring common CMS platform We have continued to extend the total procurement savings (including use of technology at the event synergies) to £10.3m per annum. level and to standardise and Particular areas of focus include IT integrate it into business systems as 89% procurement and venue contracts. 2016: 81% we do so. Use of Supplier Finder, Orbit, We have renegotiated 43 venue contracts Touchplan and other tools help improve during the year which delivered enhanced the customer experience whilst value and improved risk positions. Annualised procurement savings simultaneously providing our teams with valuable insights. In order to focus investment on growth at the event level, zero cost budgeting During 2017 the migration of our event across a number of events has proved £10.3m websites onto the UBM standard platform 2016: £6.6m effective in ensuring value is delivered has continued, generating cost savings for customers and shareholders. and improving efficiency.

Growth in Mature Events: A Sleep Case Study Already a decade old, The Sleep team has made a science of crafting unique marketing opportunities for clients that also improve the customer experience. At this years event, Moscow’s Studio Sundukovy Sisters, known for their trendsetting bars and restaurants, made a glamorous splash with this year’s Sleeper Bar – raising their profile while keeping the crowds of attendees happy. It can sometimes be hard to draw attention to new features at the show given the regularity of visitors who have the added distraction of mobiles and the melee of meetings that typify a tradeshow. Working with UBM’s experts, Modulex conceived and delivered a theme around “awaken”: “awaken your mind”at the conference, “awaken your senses” at the bar, “awaken your curiosity” at the exhibition, and “awaken your imagination” at the annual design competition. Less is more – the team reduced the amount of signage, using the text to disrupt and ‘wake’ the visitor. Through such creative product development and partnering – and the rich understanding of the audience – Sleep keeps growing.

18 UBM Annual Report and Accounts 2017 Strategic investment Throughout the period since 2014 the People and Sustainability Strategic report returns from acquisitions have delivered yielding returns A high-performing, engaged and in line or ahead of their acquisition cases. The good returns on the Events First diverse team of people is key to investment reflects the opportunity The 2017 ROI on bolt-on acquisitions delivering the Events First strategy. for improvement. made in each of 2015, 2016, 2017 was As illustrated in our business model (on 11.3%, 13.9% and 9.4% respectively. When announced in 2014, the Events pages 10–11) one of UBM's key assets are First investment was originally estimated The return in 2017 on the Advanstar the skills and endeavours of our people. Governance at £30m–£35m (split between strategic acquisition was 9.5%, a reduction on Our 2017 results reflect, in large part, opex and capital expenditure) over the the 10.7% return delivered in 2016, the hard work, dedication and enthusiasm period 2015 to 2017, with overall savings as the pressures on the Fashion and of UBMers around the world, for which expected to be £10m p.a., building Life Sciences sectors fed through into I want to say a huge thank you. from 2016. profit performance. During 2017 we have made further However, the savings have been realised On Allworld, which is performing ahead progress in developing a High significantly faster than was originally of the business case, the ROI in 2017 was Performing Culture. expected and the opportunity for savings 6.3%. We remain confident of a return Financial statements was greater than had been originally exceeding the risk adjusted cost of capital We improved the organisational capability foreseen. Accordingly, the investment by the third year of ownership (2019). within the Group, providing specialist was increased to £40m–£45m with skills training particularly in sales and targeted savings of £20m by the end of marketing and a much stronger focus 2019. At the end of 2017, total Events on performance management. First programme spend of £34.3m has Incentives continue to be adjusted delivered cumulative savings of £15.8m, to be more weighted towards the at an annualised run rate of £17.0m. financial performance of the business. Senior leadership within the business is empowered and expected to be bolder and to innovate and is now rewarded for outstanding performance.

Gamifying Sustainability to Engage Employees UBM staff believe in the importance of sustainability and are regular volunteers in the communities in which they live and work. This is actively supported by the sustainability team in UBM who, in addition to driving environmental initiatives, are tasked with improving the role of community engagement across our events. Community work can sometimes still seem quite separate from the day-to-day and it’s not easy for everyone to participate (ie home workers or those in roles less directly tied to a specific event). To help embed the sustainability ethos throughout the organisation in 2017, we experimented with gamification. Our intranet, “The Hub,” already grants employees points based on their sharing and engagement in the business. A high-profile, business-wide leaderboard shows who has the most points. Employees were invited to donate their points to one of three, staff- selected not-for-profit organisations. At the end of the process Orbis, E-Nable and IMC each received a share of the £25k donation from UBM based on the points donated (see page 26). The idea was to reinforce the mental shift from Hub points status to generosity – whilst having some fun!

UBM Annual Report and Accounts 2017 19 CEO Overview of the Year continued

New sales commission plans are being UBM, 78% (up 3%pts) see UBM as Sustainability is one of the central tenets implemented as SX is rolled-out across having an outstanding future and 75% of who we are as an organization – it the business. There have been changes (up 6%pts) of employees see we are matters to the people who work in UBM to the divisional long-term incentive committed to ethical ways of working. and positively impacts our ability to programme, which rewards multi-year, We saw a reduction in voluntary attrition attract and retain talent and importantly organic revenue growth with 75% of globally to 14% and a reduction in global we see it as part of our ‘license to awards aligned to three-year revenue sales attrition to 16%. All indicators of a operate’ in society. plans for each division, and the remaining strengthening organisation. On page 24–29 you can read about the 25% on profit delivery for the Group Over 60% of staff in the business wide range of sustainability initiatives over the same three-year period. are women. However at senior levels, driven by the people in UBM and These changes, plus the inclusion of unacceptably, women are less well supported by the business – there is much a revenue measure in the Executive represented. At the Executive Committee pride in UBM about the good we can do. Directors' LTIP performance conditions level, while better than many FTSE (see page 68), significantly accentuate companies, it is not good enough Conclusion the revenue growth strategic objective. with female representation at 37.5%. UBM’s 2017 financial performance reflects A renewed focus on performance and Our clear commitment is to increase the the attractive characteristics of the talent management is starting to bear representation of women at senior levels Events industry, with good organic growth fruit. Great credit goes to the leaders to 50% by 2020. We will use all practical supported by acquisitions, high margins and managers who have driven this measures to achieve this including and strong cash generation. cultural change throughout the business. changing how we manage recruitment, The Events First strategy is delivering Through a structured process, we can review annual and off-cycle pay practices value for shareholders and underpins the now track the performance of employees and calibrate talent. prospects of delivery of the previously and identify and develop those with the On page 25 you will see we have, for stated goals of underlying growth in line potential to do more or support those the second year, published our gender with the Events industry average and to a who need to improve. pay statistics for our UK businesses. medium term margin target of 30%. We completed our biennial Voice Survey Whilst there is no visible gender pay We enter 2018, a biennial ‘down’ year, during the year. Participation was gap for comparable jobs, the overall with good momentum in the business strong at 71%. It was satisfying to gender pay analysis reflects the over as the Events First strategy translates see other indicators of engagement representation of women at junior levels in into performance. also increasing: 86% (up 2%pts) of the organisation and under representation employees understand how their work at the more senior levels. contributes to the overall success of

Americas LGBTQ 100% UBM is proud to announce that its business in the US has received a perfect score of 100% on the 2018 Corporate Equality Index (CEI). CEI is a national benchmarking survey and report on corporate policies and practices related to lesbian, gay, bisexual, transgender and queer (LGBTQ) workplace equality, administered by the Human Rights Campaign Foundation. UBM joins the ranks of leading major US businesses. “We are proud and honoured that our US team have been recognised on the Human Rights Campaign Foundation's Annual Scorecard on LGBTQ Workplace Equality” said Scott Schulman, CEO, UBM Americas. “We at UBM Americas stand by the importance of supporting an inclusive, vibrant work environment and culture that celebrates the diversity of our employees and the communities we serve. This recognition from the Human Rights Campaign reinforces one of our core value commitments to continuously nurture and grow the passion of our people and create an inspiring place to work."

20 UBM Annual Report and Accounts 2017 The Executive Committee

Our experienced Executive Committee Strategic report (ExCo) provides strategic and operational leadership across the Group.

I was pleased to appoint Lucy Dimes As part of shifting the balance of resource Governance to ExCo when she joined in October as towards the operating businesses both CEO of UBM EMEA. Lucy’s experience Jane Risby-Rose and John (JP) Petevinos and particular knowledge in technology left the business in 2017. will complement the mix of talent and They leave with our sincere thanks for experience around the ExCo table. the contributions they have made to UBM in general and to the development and implementation of Events First Financial statements in particular.

Tim Cobbold Marina Wyatt Chief Executive Officer (CEO) Chief Financial Officer (CFO)

Lucy Dimes Jimé Essink Scott Schulman Chief Executive Officer, UBM EMEA Chief Executive Officer, UBM Asia Chief Executive Officer, UBM Americas

Simon Hollins Mark Peters Eleanor Phillips Group Chief Information Officer Group Company Secretary Group Human Resources Director

UBM Annual Report and Accounts 2017 21 KPIs

Strategic priority Progress in 2017 KPI Performance in 2017 Associated Risks Sustainability achievements in 2017 Group 2017 strategic KPIs Agile growth −− Allworld Integration progressing well −− Macroeconomic −− £13.6m of bolt-on acquisitions in fast-growth sectors +6.0% 89% −− Acquisition −− Rationalisation or disposal of £21.5m of low margin/ Growth rate of Annual Events revenue −− Country low growth Events ‘Major’ annual events from ‘Major’ events −− Ability to stage events −− Further improved alignment of OMS −− Business environment −− Event Plans v2.0 resulting in improved strategic −− Access to capital and financial planning £13.6m £40.0m −− People Spent on acquisitions Revenues rationalised or disposed Customer −− Improved timeliness of standardised post-show pts −− Macroeconomic insight and surveys +3.9 +3.2% −− Acquisition −− Improvements in Customer Satisfaction (CSAT) −− Ability to stage events People innovation and Net Promoter Scores (NPS) Uplift in NPS – Uplift in CSAT scores – Visitors Visitors −− People −− Employee engagement on biennial −− Marketing Excellence (MX) programme Voice Survey: 68% (2015: 65%) established and planning for Market Automation −− Women on ExCo: 37.5% (2016: 33%) platform roll-out developed pts −− Female managers: 57% (2016: 54%) −− Customer-led design experience and innovation +5.2 +2.3% pilots completed Uplift in NPS – Uplift in CSAT scores – Communities −− Continued investment in innovative technology Exhibitors Exhibitors −− Employees using volunteer days: 19% product offerings (2016: 14%) −− Total donations to charity £492k −− Continued success of procurement savings Annualised procurement −− Acquisition Operational (2016: 432k) excellence programme with incremental £3.7m delivered 137 saving £m −− Country −− Risk management and venue contract reviews −− Ability to stage events Environment Additional people joined 12 embedded in divisions −− 8th year of carbon emissions SX programme 10 −− Business environment −− Corporate simplification initiatives deployed across disclosure under CDP 8 −− Technological the Group 6 −− 8 Events are ISO20121 Sustainable −− Shared Service centre established in Asia 4 Events Standard 2 0 −− Net emissions (tCO2e): 22,946 2015 2016 2017 (2016: 25,721) Customers −− Continued improvement and deployment of −− Business environment Standardised −− 54 Charity Partnerships (2016: 43) Oracle finance platform Accelerated roll out −− Technological technology of common sales and CRM platform 28% 100% −− £1.5m 'in-kind' donations to charity Asia Event Revenues Events websites on and data −− Marketing automation planning finalised partners (2016: £1.6m) now running on common common CMS platform −− Developed single global tech and −− "Exhibitor Guide" to promote CRM platform in EMEA data architectures sustainability with our exhibitors (EMEA and Americas) Governance 86% 89% −− We have added additional Human Rights assurance procedures at our EMEA Event Revenues Event websites on events and additional compliance now running on common common CMS platform clauses in supplier contracts CRM platform in Americas −− Appointed anti-bribery and corruption (ABC) representatives High −− Employee engagement up to 68% (2015: 65%) −− Country from all parts of the business performance −− New performance management process rolled-out 68% −− Business environment −− Physical security SafeTrack training culture −− Global talent evaluation process introduced and Employee engagement −− People −− Launched 'Sustainable-10' KPI completed in 2017 on biennial Voice Survey programme at our Events −− Short and long-term incentive plans further (2015: 65%) aligned to strategy −− 69% of learning and development (L&D) budget spent supporting Events First priorities in sales and marketing

22 UBM Annual Report and Accounts 2017 Strategic priority Progress in 2017 KPI Performance in 2017 Associated Risks Sustainability achievements in 2017 Group 2017 strategic KPIs Strategic report

Agile growth −− Allworld Integration progressing well −− Macroeconomic Revenue1 £m −− £13.6m of bolt-on acquisitions in fast-growth sectors +6.0% 89% −− Acquisition +16.2% −− Rationalisation or disposal of £21.5m of low margin/ −− Country Growth rate of Annual Events revenue 1,000 low growth Events ‘Major’ annual events from ‘Major’ events −− Ability to stage events 925 −− Further improved alignment of OMS −− Business environment 850 −− Event Plans v2.0 resulting in improved strategic −− Access to capital Governance and financial planning 775 −− People £13.6m £40.0m 700 Spent on acquisitions Revenues rationalised 2013 2014 2015 2016 2017 or disposed (%) Customer −− Improved timeliness of standardised post-show pts −− Macroeconomic Adjusted operating profit* margin insight and surveys +3.9 +3.2% −− Acquisition + 2.1%pts −− Improvements in Customer Satisfaction (CSAT) Financial statements −− Ability to stage events People 30 innovation and Net Promoter Scores (NPS) Uplift in NPS – Uplift in CSAT scores – Visitors Visitors −− People −− Employee engagement on biennial 28 −− Marketing Excellence (MX) programme Voice Survey: 68% (2015: 65%) established and planning for Market Automation 26 −− Women on ExCo: 37.5% (2016: 33%) platform roll-out developed 24 pts −− Female managers: 57% (2016: 54%) −− Customer-led design experience and innovation +5.2 +2.3% 22 pilots completed 2013 2014 2015 2016 2017 Uplift in NPS – Uplift in CSAT scores – Communities −− Continued investment in innovative technology Exhibitors Exhibitors −− Employees using volunteer days: 19% product offerings (2016: 14%) Diluted adjusted EPS*1 (p) −− Continued success of procurement savings −− Acquisition −− Total donations to charity £492k Operational (2016: 432k) +34.5% programme with incremental £3.7m delivered −− Country excellence 137 60 −− Risk management and venue contract reviews Environment Additional people joined −− Ability to stage events embedded in divisions 50 SX programme −− Business environment −− 8th year of carbon emissions −− Corporate simplification initiatives deployed across disclosure under CDP 40 −− Technological the Group −− 8 Events are ISO20121 Sustainable 30

−− Shared Service centre established in Asia Events Standard 28 2013 2014 2015 2016 2017 −− Net emissions (tCO2e): 22,946 (2016: 25,721)

Customers Cash generated from operations* (£m) −− Continued improvement and deployment of −− Business environment Standardised −− 54 Charity Partnerships (2016: 43) Oracle finance platform Accelerated roll out −− Technological +16.6% technology of common sales and CRM platform 28% 100% −− £1.5m 'in-kind' donations to charity Asia Event Revenues Events websites on 300 and data −− Marketing automation planning finalised partners (2016: £1.6m) now running on common common CMS platform 225 −− Developed single global tech and −− "Exhibitor Guide" to promote CRM platform in EMEA 150 data architectures sustainability with our exhibitors (EMEA and Americas) 75 Governance 0 2013 2014 2015 2016 2017 86% 89% −− We have added additional Human Rights assurance procedures at our EMEA Event Revenues Event websites on events and additional compliance ROACE*1 (%) now running on common common CMS platform clauses in supplier contracts CRM platform in Americas −− Appointed anti-bribery and - 1.0%pts corruption (ABC) representatives 20 −− Employee engagement up to 68% (2015: 65%) −− Country from all parts of the business High 15 −− New performance management process rolled-out 68% −− Business environment −− Physical security SafeTrack training performance 10 −− Global talent evaluation process introduced and −− People −− Launched 'Sustainable-10' KPI culture Employee engagement 5 completed in 2017 on biennial Voice Survey programme at our Events 0 −− Short and long-term incentive plans further (2015: 65%) 2013 2014 2015 2016 2017 aligned to strategy −− 69% of learning and development (L&D) budget spent supporting Events First priorities in sales 1 A performance measure in the Long-Term Incentive Plans and marketing (see Directors' Remuneration Report on page 68)

UBM Annual Report and Accounts 2017 23 Sustainability Report Introduction

Sustainability is central to how we Leading in sustainability Our aim is to push the boundaries and behave and how we do business. lead our peers towards a sustainable Events industry. UBM was the first global We act ethically and strive to produce a events organiser to gain international sustainability standard ISO20121 and positive social and environmental impact to record the carbon emissions from for our customers, employees and our events. In 2017 UBM sponsored UFI’s ‘Best communities we serve. Our sustainability Practice in Sustainability’ report which showcases industry-leading sustainability strategy encompasses the following initiatives from members across the global association of exhibition five elements: industry companies.

"We are committed to achieving sustainable events and are proud to be at the forefront of our industry, driving change towards that goal."

Tim Cobbold Chief Executive Officer

Achievements

UBM has maintained FTSE4Good status UBM disclosed in CDP's Climate Change Eight UBM events are now certified with for the last three years. programme 2017, marking eight years of ISO20121 Sustainable Events Standard. consistent carbon emissions disclosure.

24 UBM Annual Report and Accounts 2017

People

Our employees are critical to UBM’s During 2017, our employee-led culture generated 96% employee awareness, with Strategic report success. We understand the unique diversity group in EMEA hosted several participation in 15 countries and 30 cities. value of our employees, who are the thought-provoking lunchtime discussions, The campaign continued throughout the source of our innovation, customer encouraged sharing about different year including the use of log-in screens service and good governance, helping backgrounds and culture, and organised and digital displays in offices. to make amazing things happen at our work experiences at UBM for university We also expanded opportunities for events and ensuring that we act with students from under-represented groups. employee feedback and communications. integrity in how we operate.

Wellbeing Our CEO held six informal employee Governance We also understand the importance We work hard to create the right feedback sessions in 2017 in the UK and of providing an open and supportive conditions to support mental wellbeing US, where groups of 15–20 employees workplace where they can thrive. at work. During the year an employee- from all levels of the business were encouraged to share their impressions Diversity led mental health awareness programme was established, with lunch-and-learn of working at UBM, the culture, strategy We embrace diversity in all its forms, sessions, extensive online engagement and anything else on their minds. recognising that a workforce with a wide via the Hub (our internal communications Following this, there was a series of CEO

range of backgrounds, experience and Financial statements tool) and the training of Mental skills is fundamental to our success. video-blogs updating employees on Wellbeing Champions. strategy and major initiatives. At UBM diversity is championed through Employees continue to utilise on-site gym executive support and employee- We also conducted our biennial employee facilities (where available), and various led projects. survey (UBM Voice Survey), which shows sports clubs have been set up, including improvement in overall engagement (see In 2017 we appointed one of our senior netball and football. Cycling is also data below). leaders to lead the global efforts encouraged with secure bicycle storage, relating to gender diversity, focusing shower facilities and regular on-site bike Recognition on four areas: recruitment; employee servicing days. In 2017 we introduced our first global development; compensation and recognition award – the EPICS – Employee engagement community. Actions developed in these rewarding exceptional performance from areas resulted in UBM Americas attaining In 2017, we expanded our efforts to across the business. Categories included: a perfect score of 100% on the Human engage employees, including the launch consistent event performance; best Rights Campaign Equality Index, which of an internal branding campaign event launch; best event turnaround; judges how progressive and inclusive a that reinforced our image as a global, and best sustainability commitment. corporate culture is (see case study on connected business creating magical We also celebrated our first global page 20). moments. The 'See You There' campaign "Customer Hero".

People performance Employee Engagement Dec 2017 Dec 2016 Total headcount 3,933 3,852

Dec 2017 68% 2015: 65% Gender split Male Female Board 67% 33% Executive Committee 62% 38% Employee advocacy Senior Leadership Team 73% 27% All Managers 43% 57% All Employees 38% 62% 72% 2015: 69%

Gender pay differentials Pride in UBM All UK employees1, 2 Male % Female % Mean Median Band of band of band Difference Difference Lower 33% 67% 1.3% 1.2% Lower Middle 42% 58% -0.2% -0.9% 75% Upper Middle 44% 56% 1.4% 2.9% 2015: 71% Upper 62% 38% 4.6% 3.7% 1 All UBM UK entities 2 Quartile pay bands

UBM Annual Report and Accounts 2017 25 Sustainability Report continued Communities

UBM's community engagement Our Amsterdam office held its first Various parts of the US were affected programme helps us to support iVolunteer day for the whole office, by hurricanes and wildfires in 2017, communities local to our offices with 89 employees (69% of the and UBM staff acted quickly to provide and those linked to our events. office) spending the day working with volunteering support and donations UBM provides employees with up to children, elderly refugees and those (which UBM matched). 32 hours per year to volunteer with with disabilities. Employees from the UBM Santa Monica charities and non-profits, as well as 14 employees from the London office office volunteered their time to make volunteer grants and matched funding. volunteered to cook Christmas dinner and donate blankets for the victims of Those who volunteer for a charity on for 100 elderly people in the local hurricanes Harvey and Irma, completing a regular basis are eligible to receive a Bankside area. 43 baby blankets in just over six hours. volunteer grant of £750 for their charity. In India, the partnership with the charity UBM matches donations for fundraising Give as you gain ‘Feeding India’ was developed and the activities up to £500 per employee This year is the first time our internal process of donating food from our per year. During 2017 UBM matched collaboration tool – the Hub – was events in Mumbai was set up by UBM’s funding was also applied to disaster linked to UBM charity donations. Pramod Dhavan, an Assistant Manager relief donations. Employees were able to ‘donate’ their in Mumbai, after his inspirational trip to points to one of three selected charities, Volunteering One Young World. (See case study in which are also Event Charity partners In 2017 19% of employees volunteered opening spreads.) (Orbis – a global charity fighting (2016: 14%), spending over 3,000 hours Disaster relief avoidable blindness; e-NABLE – who supporting our communities. create 3D printed prosthetic hands and UBM owns the largest construction show arms; and IMC, International Medical The following are examples of the many in Latin America, which is held in Mexico Corps, who provide disaster relief and volunteering activities that our employees City. It was here that earthquakes struck deliver healthcare around the world). have been involved in over the last year: in September 2017, just weeks before UBM then turned these points into cash the UBM event in October, resulting in During 2017, UBM supported its up to a total of £25,000 (see case study a full evacuation of the Mexico offices. communities in the ‘Fight against Hunger’. on page 19). UBM donated £150,000 to the Mexican UBM Americas employees, from across Earthquake relief through the Carlos Slim 15 different offices, volunteered over 350 Foundation, which matched donations hours at foodbanks, soup kitchens and 5-to-1, therefore unlocking £750,000 homes for the elderly. towards rebuilding the city.

Communities performance ASIAWATER campaign 2017 2016 2015 For the last two years ASIAWATER, UBM's leading water industry event for Developing Asia, has Employee fundraising (£) 79,108 – Fundraising 72,799 formed the Responsible Business Alliance to bring UBM matched funding/grants (£) 419,366 353,000 – together leading charities from across South East Total cash donations to charity (£) 492,165 432,108 249,912 Asia with a mission to bring clean, safe drinking water and sanitation to communities in need. During 2017, the campaign organised clean water Volunteering % of employees using volunteer days 19% 14% 8% for a village in Vietnam and a village school in Volunteering hours 3,289 – – Myanmar. It is estimated that over 1,500 people will receive clean water supply from the UBM 'safe drinking water campaign'.

% of employees using Volunteering volunteer days hours 19% 3,289 2016: 14%

26 UBM Annual Report and Accounts 2017

Environment

We strive to run UBM’s business in Energy Waste Strategic report an environmentally responsible way, Over the past seven years, UBM offices No UK offices send waste to landfill. reducing our environmental impact globally have achieved consistent energy The London office recycles over 90% wherever and whenever possible. reductions through efficient energy of waste, and the remaining 10% is sent We are committed to raising awareness monitoring and management, and to an ‘energy from waste’ facility which of environmental issues with our regular communication. utilises the waste to power homes. suppliers, customers and the owners of the venues we use, working together In each new UBM office, energy smart The waste from our events is mainly from to find solutions. meters are installed wherever possible stand materials, carpets and paper. Governance to measure UBM’s energy usage on For all events we encourage the design Carbon emissions a real-time basis, ensuring that any of reusable stands to reduce waste. UBM were one of the first FTSE 350 anomalies can be identified immediately You can read on the next page, how we companies to set an approved ‘Science- and rectified. are collaborating with our customers based target’. The target is to reduce Both the London and San Francisco on this. Scope 1 & 2 carbon emissions by 11.4% per offices have LEED Platinum certification, square metre of event and office space In Hong Kong, the UBM Asia Events

which represents the highest level of Financial statements by 2020 (against a baseline set in 2015). reviewed their processes and designs and 'Leadership in Energy and Environmental By the end of 2017 progress was as follows: reduced paper use by 10% (12 tonnes) Design', and the London Head in 2017. They have also moved to using −− 23% reduction in Scope 1 & 2 carbon office continues to retain ISO14001 soy based vegetable ink, FSC paper, and emissions per square metre of office certification with its environmental photo degradable envelopes to further space (against baseline 2015) management system. reduce the environmental impact of −− There has been a 1.4% increase in At our events, we are targeting their printing. our emissions per square metre from energy reductions in various ways. The carpet for UBM Americas Events events since 2015. This has been due Food Ingredients Europe, has reduced its is collected and reused for subsequent to high energy usage per square metre environmental impact due to its energy shows up to five times, after which in events acquired and incorporated usage by working with our contractors time it is recycled into plastic products. into our portfolio in the US in 2016. In to switch to LED lights for all feature In Las Vegas we are also partnering with order to focus on further reductions in areas and shell scheme stands (reducing our venue to ensure sustainable lighting emissions from events in this area, a new each bulb’s energy use by around 80%), solutions for the future. (See case Sustainability manager for the Americas and by using renewable energy. region has now been appointed. study below.)

Environment performance A bright future for all of us UBM Fashion has partnered with the Mandalay Mandatory Carbon Emissions reporting (tCO2e) 2017 2016 2015 Bay Convention Centre to enhance customer Scope 1 – Direct emissions on-site experience and improve the −− Gas emissions from offices 85 84 144 sustainability of our Events for decades to −− Fugitive emissions from offices 2 43 0 come. Together we have made a multi-million dollar investment to upgrade the lighting while −− Emissions from Company-owned vehicles 104 110 110 reducing our carbon footprint at the Mandalay Scope 2 – Indirect emissions Bay Convention Centre, taking effect at UBM's −− Electricity from offices 2,530 2,949 2,761 MAGIC Event in February 2018. Scope 3 – Other indirect emissions As a result we are replacing more than 1,000 −− Water use emissions from offices 26 9 2 light fixtures with top-of-the-line LED lights, −− Waste disposal to landfill from offices 12 6 7 increasing the luminescence of the interior of the hall by nearly 300%, yet using 85% less energy. −− Waste – energy recovery from offices (inc, anaerobic) 2 0.2 0.3 −− Commuter travel emissions 2,201 2,456 2,929 −− Business travel (flights) 2,195 1,904 1,923 −− Business travel (train) 96 88 83 −− Business travel (taxi) 92 91 83 −− Business travel (car hire) 67 52 35 −− Offsite datacentre electricity 159 385 325 −− Events globally (Emissions from recorded electricity, gas, waste, paper and carpet usage) 16,420 18,146 14,074 Total gross emissions 23,991 26,323 25,491 Net emissions (minus energy from renewable sources) 22,946 25,721 25,491 Scope 1 & 2 emissions per square metre of office space 0.0548 0.0649 0.0711 Net event emissions per square metre of event space 0.0040 0.0049 0.0039 1 Please refer to page 89 in the Directors’ Report for calculation methodology 2 Emissions from recorded electricity, gas, waste, paper and carpet usage

UBM Annual Report and Accounts 2017 27 Sustainability Report continued Customers

Our customers include those attending Recognition CPhI’s in-kind contribution of over our events as well as exhibiting at At our EMEA events we launched a £21,000 included a complementary stand them. We develop and improve our Sustainable Stand award. Exhibitors enter at the event, and promotional materials. customer experience through close by submitting information on the IMC also received UBM donations of over collaboration and engagement on sustainability credentials of their stand. £14,000. sustainability matters. We develop Stands are then inspected onsite and At Advanced Manufacturing’s New York charity partnerships, which enable our exhibitors and contractors interviewed. event in June 2017, UBM partnered customers to donate and participate in The award is presented at a prestigious with e-NABLE, a group of volunteers a sustainable event experience. ceremony at the event, and UBM media who produce 3-D printed prosthetic Collaboration channels utilised to further celebrate limbs. e-NABLE hosted 90-minute the winners. At CPhI, our worldwide From our recent customer survey workshops on each day of the event, pharmaceutical event, the award this year at EMEA Events, 58% of customers where attendees were invited to build was given to a company that designed a stated that event sustainability was prosthetic hands customised for specific reuseable stand to eliminate waste and important to them, and 36% wanted children. They were also able to decorate ensured that the power to the stand was more information on how to be more the storage bag and write to the child 100% renewable. sustainable at our events. During 2017 receiving the hand. we launched the ‘Exhibitor guide’ at Charity partnerships UBM’s Child Baby Maternity Expo EMEA and Americas events, which clearly Charity partnerships at our events enable (CBME) in China, organised a charity states our aims for sustainability at UBM our customers to be part of an industry sale for customers at the event. 'Care and how we can work together with our relevant charitable initiative. for the Orphans Charity Sale' gained exhibitors to achieve a sustainable events great support among the industry, as 47 industry. The guide provides a user- CPhI Worldwide, Medtec Europe, and Pharmapack events have developed a exhibitors donated their products, raising friendly checklist, with ten important over £18,000 to provide financial support points to remember, including sharing partnership with International Medical Corps (IMC). UBM developed a presence and cover medical expenses for orphans their sustainability credentials at the in Beijing. This is the third year that CBME event, how to reduce carbon impact, for IMC at CPhI Worldwide 2017, helping to raise awareness, deepen China supported children-related charities and ensuring stands are designed to in China. be reused. existing partnerships and develop new relationships with pharmaceuticals and medical equipment suppliers, who are key to their disaster relief work.

Customer performance Blackhat gives back 2017 2016 UBM's leading event for information security professionals. engaged with, and supported its Number of applications for "Sustainable Stand" award 30 12 customers in a number of ways: Number of charity partners 54 43 −− Blackhat’s new diversity-focused partners Total "in-kind" donations to charity partners (£) 1,495,273 1,620,253 included Queercon, International Consortium of Minority Cybersecurity Professionals (ICMCP), and Women in Security and Privacy (WISP). % of customers for whom event % of customers requesting more −− Awarded 230 Academic Briefings Scholarships sustainability is important guidance on event sustainability and grants to deserving students and ICMCP members from around the world. Of those, more than half were granted to under- represented groups and minorities. 58% 36% −− For the fourth year, Blackhat donated $50,000 to the Electronic Frontier Foundation to continue supporting their important work in protecting civil liberties within the digital world. −− In support of Hack the Hood, Blackhat developed an exclusive BlackHat USA 2017 t-shirt for the show with all proceeds being directly donated to help bring technology and education to low-income communities in the US and rural communities in developing nations.

28 UBM Annual Report and Accounts 2017

Governance

Acting with integrity is core to how Fundamental Principles and Rights at areas of health, safety and security and Strategic report we operate. ‘Doing Business at UBM’ Work. We also endeavour to ensure that are based around compliance with our is our Code of Business Conduct, our supply chain is ethical, particularly global HSS policy and 15 performance underpinning our core values and in relation to human rights and modern standards. providing guidance to employees. slavery, and during the year we have Risk management is a core aspect of We seek always to conduct business added additional assurance procedures our approach, covering the protection honestly and responsibly and treat at our events. We are also including of staff generally, our facilities and everyone – customers, colleagues, additional compliance clauses into all parties who may attend an event. business partners, investors and the supplier contracts, making clear the Training programmes are in place to Governance wider community – with integrity standards with which we expect third support risk management activities. and respect. parties to comply. Our Modern Slavery Act statement is on our website. Our performance is monitored and The Code of Business Conduct forms part measured using inspection and auditing of a new employee’s induction process Anti-bribery and corruption methodologies and regular reports are and also applies to our joint venture All employees receive training on provided to the Executive Committee partners and other third parties with anti-bribery and corruption (ABC) and the Board using consistent whom we do business. The various policies and anti-malpractice. We operate an performance indicators. Financial statements that comprise the Code of Business independent confidential reporting Conduct are regularly reviewed and are line – “Safecall” – which is an important Sustainable-10 KPIs accessible via the Hub (UBM’s intranet). means by which employees can raise At the end of 2017 we launched a new set of Sustainability KPIs for our events. Key areas include: concerns anonymously, and during 2017 we appointed anti-bribery and The areas of focus include Stakeholder Human rights corruption representatives across all Engagement, Material Use & Waste Given the nature of our business and parts of our business. Management, Carbon Mitigation, our global reach, we believe that Procurement, Charitable Giving, Health, Health, Safety & Security (HSS) the principal human rights issues Safety & Security, and Event data. Implementation of our SafeTrack strategy affecting our business relate to non- was extended during 2017 to incorporate During 2018 we will be setting the discrimination and fair employment physical security. During the year we baseline for these KPIs and will, going practices. We support the principles of increased the level of dedicated resources forward, report specific progress in these the United Nations Universal Declaration to support the implementation of our areas towards increased sustainability at of Human Rights and the International regional programmes, which address key our events. Labour Organisation’s Declaration on

Governance performance Living wage employer UBM is an accredited living wage employer. Those working at UBM's UK offices including HSS audits completed employees, third-party contractors and suppliers, receive the living wage or above. The living wage is a voluntary pay rate, based on a robust calculation that reflects the real cost of living in 13 the UK and in London. This ensures that anyone 2016: 8 working on UBM UK premises is rewarded for a hard day’s work with a fair day’s pay. It is significantly higher than the national minimum Employees completing HSS training wage and the UK government's statutory national living wage. 2017 marks the second year that UBM has achieved this accreditation with the 98% Living Wage Foundation.

Employees completing ABC refresher training 95%

UBM Annual Report and Accounts 2017 29 Risk management

Structure and control Developments in risk −− Following a review by the Audit The UBM Regulatory, Legal & Compliance management in 2017 Committee earlier in the year, function (RLC) deals with processes responsibility for Business Continuity During the year UBM continued to Planning (BCP) was assigned to RLC. and methods for managing risks across keep under review its risk management the Company. It works in partnership A new BCP policy was developed policies and procedures in order to and subsequently approved by the with Head Office functions and the ensure that they continued to support divisions to assess business and strategic Executive Committee. This sets out the Events First strategy and UBM's UBM’s strategy and approach to BCP. risks (identification, assessment operations worldwide. and prioritisation). RLC has been working with Divisional −− The Audit Committee received BCP Coordinators on introducing a The UBM Board has responsibility for divisional risk presentations as well prioritised but phased approach to monitoring the risk management systems as a risk review of the UK Shared BCP across UBM. The largest offices across the Company and for reviewing Services Centre. and data centres have been targeted their performance and robustness. first. Through a centrally-coordinated −− The Board reviewed a number of process, the Board receives risk reports targeted risk reports looking at the −− UBM’s risk scenario modelling has from each of the businesses and some principal risks across the business. been updated to include testing the functional areas on their principal risks These included a broad-based market resilience of the organisation to a and the action plans they have in place and business risks review of China and global macro-economic slowdown and to mitigate against them. In monitoring, individual market sector reports. loss of a major venue used by UBM. the Board is assisted by the UBM Audit −− Following a review of UBM’s principal −− Our Internal Audit planning process Committee which reviews and challenges venue contracts in 2016, a new now includes an assessment of how management on risk management process was introduced across the the businesses are addressing their processes and procedures. The Executive business to review and challenge areas principal risks Committee regularly assesses operational of significant contractual liability faced and strategic risks facing the business by the organisation. Risk management process with the support of RLC. On page 31 we illustrate UBM’s risk −− Divisional materiality thresholds and management structure. UBM employs risk maps were reviewed and confirmed both a top-down and a bottom- up approach.

Risk map

Principal risks High 1: Macro-economic slowdown, geopolitical instability/or exchange rate fluctuations 2 1 2: Acquisition risk 3: Specific country risk and Emerging Markets exposure 3 4: Factors and incidents affecting our ability to stage an event 5: Changes in our business environment 6: Technological risk; execution, data breach and cyber security Attractive market and strong UBM 7: Access to capital 4 8: People recruitment and retention Impact position Change since previous year. (If no is displayed, there has been no change)

6 5 7 8 Low Low Likelihood High

30 UBM Annual Report and Accounts 2017 Risk management process Strategic report

UBM employ both a top-down and a bottom-up approach Top-down review to identifying risk ExCo, Head Office and the divisions review the Group and divisional risks maps and compare them Scenario planning / Monitoring and with the existing and future characteristics of our products, our services and our customers. A back- strategy creation mitigation Governance casting exercise was also undertaken in 2017 led by Adjusting strategic an external facilitator. This involved exploring worst case scenarios and mapping them to the current UBM emphasis principal risks to confirm their validity. We continue to use a financial modelling process, based on an enhanced version of that used in 2016, to test the resilience of the business in relation to its solvency and liquidity. Strategic and operational consideration Financial statements Audit Committee Risk analysis and Board and evaluation review Bottom-up review Risk management A full risk assessment and identification exercise is carried out twice a year. The RLC function assists the divisions and business functions to review and challenge impacts and likelihoods. Aggregation also captures separate risks recorded globally. RLC, with the divisions, review materiality thresholds to ensure risk reports are relevant and appropriate. Divisional risk Monitoring and identification and mitigation assessment exercise

Risk identification at both the top-down and bottom-up level follows a standard risk management framework to assess net impact and likelihood. Net risk measurement is the impact and likelihood of a given risk after controls are taken into account. Risks are ranked in order to appropriately direct resources to those which are more material to the business. Risks which reach a materiality threshold have specific mitigation plans in place to reduce or remove those risks.

UBM Annual Report and Accounts 2017 31 Principal risks

In accordance with provision C.2.1 of the 2016 UK Corporate Governance Code, the Board of Directors has made a robust assessment of the principal risks facing the business including those that could threaten its business model, future performance, solvency or liquidity. The following principal risks have been identified from the review process.

Strategic priorities Change in 2017

Agile Customer Operational Standardised High No change Risk increased Risk decreased growth insight and excellence technology performance innovation and data culture

Risk Impact Mitigation Risk trend Macroeconomic The geo-political environment remains −− Our business is diversified across multiple geographies and volatile and a subsequent slowdown in sectors which reduces our reliance on specific regions. slowdown geo-political the global economy or a regional crisis −− We have invested in IT systems that will bring us greater instability/or exchange could adversely impact the Company’s visibility and improve our ability to respond to macro changes revenue, as exhibitor, advertising, attendee, more quickly. rate fluctuations sponsorship and other discretionary revenue may decline. As an international −− Market and credit collection trends are closely monitored Events First: business UBM is sensitive to this risk. and regularly reported at a divisional level. Foreign exchange rate fluctuations, −− Credit policies are kept under review. particularly the US Dollar, could adversely −− We continue to monitor the implications of Brexit. affect our reported earnings and the −− Exchange rate risk is partially hedged by issuing debt in strength of our balance sheet. currencies to which we have significant exposure.

Acquisition risk Acquisitions are an important part of −− We apply strict strategic and financial criteria, and have our strategy. Acquisitions may not well documented acquisition and integration processes. deliver their expected returns. Events First: −− We employ comprehensive due diligence processes in Integration issues or failure to realise assessing potential acquisition opportunities. operating benefits or synergies may also impact expected returns. −− We adopt clear delegated authorities which require Management and Board consents before proceeding (over specified threshold values). −− We monitor key financial and operational metrics on a monthly basis following an acquisition to ensure business plans and expected synergies are delivered. −− For acquisitions of a certain size, we formally review actual performance against the original business plan and the output is presented to the Board. Follow up reviews may be arranged if appropriate. The performance of all acquisitions is monitored as part of the budgeting/reforecasting reporting process and by formal post-acquisition reviews.

32 UBM Annual Report and Accounts 2017 Risk Impact Mitigation Risk trend Strategic report Specific country risk Our business operates in many −− We are disciplined about deciding where we choose to geographies, particularly Emerging operate and new market entry is subject to approval by and Emerging Market Markets such as Turkey, the Middle East the Board. and Russia which may present logistical exposure and management challenges due to −− We engage in proactive stakeholder management to foster different business cultures, languages or strong relationships with government and industry operators. Events First: unfavourable changes in applicable law −− We integrate key owners and managers of our joint venture or compliance requirements. Maintaining partners into our development programmes. our reputation as a responsible corporate −− We adopt global controls and strong financial systems and Governance entity in the countries we operate in is a compliance requirements. New markets are subject to the focus for the Company. same standards and policies as all other business regions. Expansion through joint ventures reduces −− Compliance and governance risks are assessed by Group and logistical and management issues but can managed through legal and operational reviews. create governance and control challenges. −− We adopt global ethical and operational standards which meet or go beyond local requirements.

Factors and incidents A disaster or natural catastrophe, −− All our divisions have business continuity and crisis Financial statements terrorism, political instability or disease management plans in order to help mitigate against affecting our ability to could affect people’s willingness to catastrophic events. stage an event attend our events, which could have an −− We will postpone and/or move an event if necessary. adverse effect on our revenues. There is a reputational risk based on how effective −− We foster strong relationships with venue operators and plan Events First: our response to these risks might be for alternative locations. UBM utilises some of the largest global −− We place a strong focus on Health, Safety and Security and venues available creating the possibility best practices to reduce the risk of an incident occurring. of concentration where few or no −− We carry insurance to reduce our risk exposure. alternatives exist. −− We build upon our engagement with our customers outside UBM relies on suppliers to help deliver of live trade show events through the use of digital platforms. effective events. Risks to the integrity −− UBM Americas created a Major Incident Management and suitability of these key relationships Plan. In addition, external consultants. visited three major could undermine the effectiveness of convention centres we use and interviewed their staff these events. and observed their resources and systems. Their report A major incident at a venue during confirmed that the security procedures in these venues an event may give rise to significant exceeded the industry norm. contractual liabilities. −− Each division now has a dedicated Health, Safety & Security lead manager. −− We monitor our key suppliers closely. −− We have enhanced the BCP policies and procedures across UBM with plans in place to schedule live testing exercises. −− We have a new global process in place to examine contracts with major venues to identify areas where we could improve commercial terms and reduce contractual liability.

Changes in our We cannot predict all the changes −− We use customer insight and experience initiatives to identify and impacts that may affect the emerging trends. Each division closely monitors these trends business environment competitiveness of the business, such and provides regular updates to senior management. as changes in customer behaviour, or −− We collect and analyse consistent global customer metrics Events First: technological innovations which would relating to Net Promoter Score (NPS) and Customer increase competition or make some Satisfaction (CSAT) scores. products or services less relevant. −− We invest in innovative products that enhance our events and, over time, through development, acquisitions and Social media platforms, search engines disposals, seek to reduce exposure to products which are at and other online technologies could all risk, such as print advertising. pose a competitive threat to our businesses, as could changes in −− We use a number of different social media platforms and legislation or compliance requirements other sources as one of many connection points with our where we operate. customers. −− We compete strongly in all our market sectors and we are strengthened by the leading market position of our events and our reputation as a professional and international organiser. −− We will continue to work on our relationship with venue operators so that we get access to venues supported by long term contracts.

UBM Annual Report and Accounts 2017 33 Principal risks continued

Risk Impact Mitigation Risk trend Technological risk; The increasing threat from unauthorised −− Our IT Function operates under clearly defined policies, access to our systems by external parties procedures and maintenance programmes. These policies are execution, data breach could lead to reputational damage and reviewed annually and a phased upgrade of our information and cyber security regulatory action. security resources will be completed next year. As part of its strategy, UBM has continued −− In 2017 we undertook a comprehensive programme for our Events First: to invest in the technology platforms of information security systems, processes and organisation. the business to ensure the data we hold This provides a Global Information security management remains protected despite the rapidly system. We have 24/7 global monitoring and alerting of evolving cyber risk landscape. threats to UBM's networks and systems. System failure could have a significant −− We conduct regular vulnerability assessments of UBM’s impact on our business. The collapse of global network. We conduct independent penetration the Cloud on which various products and tests of our systems, using a risk based approach. systems are hosted could have negative −− Disaster Recovery Plans are in place for key systems and consequences for our operational activity. these are subject to regular testing. We have also increased the resilience of our infrastructure through improved system design and enterprise architecture. −− We train our employees and raise their awareness on how to behave with regards to information security best practices with a relaunch of computer based training and planned phishing training for next year. −− UBM has completed a Global Data Centre project. Starting with Data Centre consolidation in the US this year we are able to deliver an agile, low cost infrastructure for UBM. This underpins our comprehensive disaster recovery structure. −− We are addressing the requirements of the new European GDPR (data privacy regulation) through a cross-divisional, cross-functional programme.

Access to capital With the changing macro-environment −− Our debt sources are diversified and maturities spread out. and currency changes, the availability Debt is mostly in US Dollars to provide a natural hedge. or cost of financing may affect our Events First: −− We maintain sufficient liquidity and headroom, and our policy acquisition strategy. is to maintain a manageable maturity profile. −− We plan on refinancing in advance of maturities to minimise risk. −− We have access to both long-term and short-term borrowing facilities at competitive rates.

People recruitment Changes in the operating model and −− We use external salary benchmarking as part of our annual competitive external landscape could see pay review cycle. and retention an increase in staff turnover. −− We benchmark short and long term incentives to ensure competitiveness. Events First: −− We maintain standard terms and conditions including post-termination provisions for all key personnel. −− Performance reviews and objective setting is carried out formally each year in respect of all personnel. −− We calibrate performance levels and invest in top talent and key personnel. −− A robust succession planning process is in place across the Group. −− We use routine “pulse” checks to measure the extent of employee engagement and to learn from their feedback.

34 UBM Annual Report and Accounts 2017 Strategic report Long term viability statement The scenarios comprised: For each scenario, UBM has also identified the mitigation steps it In accordance with provision C.2.2 of the −− A major incident at a venue in would take to reduce the risk and 2016 UK Corporate Governance Code, North America. the Board has assessed the outlook of performed the scenario modelling on the Company over a three-year period. −− A regional crisis. that basis. These mitigations include the identification of business continuity This period continues to be relevant for −− A key territory restricting market plans and crisis management strategies, the following reasons: access. and how frequently these are tested. Governance −− It aligns to the time period for UBM’s −− A negative shift in a key sector. Other mitigations included portfolio and financial plan and Major event plans. territorial diversification. Additionally, − A global economic downturn. − reverse stress testing was used to assess −− For Major events, a three-year the magnitude of change in one or more period gives sufficient time to review Key assumptions made in UBM’s long variables within the three-year financial expected revenues (based on advanced term financial model are: plan necessary to cause a collapse of bookings) and associated risks. −− Continuing our Events First strategy UBM’s solvency. This test was based −− Multi-year contracts are entered into over the three-year period. on the potential impact of litigation, Financial statements with major venues which on average −− Organic revenue growth third party property damage and a extend over a three-year period. supplemented by targeted worsening macroeconomic environment. The modelling demonstrated that The Board has assessed the principal acquisitions and moderate margin UBM broadly maintained adequate risks to the business supported by improvements. headroom in the event of the scenarios severe but plausible risk scenario −− No change to the current long-term occurring and for a combination of modelling. Management carried out a debt maturity profile. certain scenarios. Where the combined top-down and bottom-up assessment of scenarios came close to breaching the risks facing the business, identifying UBM’s headroom it was judged that eight principal risks. These are set out in there would be sufficient time for the the Principal Risks section on pages 32 Company to adjust and for additional to 34. Of these Principal Risks, five were mitigation to be carried out. selected by the Audit Committee to be modelled as part of the assessment of Based on the results of this analysis, the Long Term Viability Statement. the Directors believe that the Group is well placed to manage its business risks successfully, having taken into account the current economic and market trends, and will be able to continue in operation and meet its liabilities as they fall due over the three-year period.

UBM Annual Report and Accounts 2017 35 Operating and Financial Review

Revenue, earnings and cash flow all delivered strongly reflecting the continued progress with the implementation of Events First.

Dear Shareholder Operating review – Events UBM’s financial performance in 2017 demonstrates continued Adj. progress with the Events First strategy. Each of the key financial FY 2017 FY 2016 Underlying underlying £m change* % change* % metrics of organic revenue growth, operating margin, EPS £m and cash flow developed well in the main due to the improved Annual Events revenue performance of the events portfolio together with the impact of North America 325.6 295.3 -1.2 0.2 the Allworld acquisition. The results also benefited from the ‘up' China (Mainland & HK) 227.9 207.0 8.2 9.4 year biennial effect and from favourable currency movements. Emerging Markets 112.3 71.7 5.4 6.5 Reported continuing revenue grew by 16.2% to £1,002.9m. UK 30.3 35.7 0.3 5.7 Adjusted underlying growth* (the KPI used to measure organic Continental Europe 64.3 59.0 6.3 10.2 growth) increased to 4.1%, up from 2.1% in the prior year. RoW 20.2 14.8 24.8 24.8 The adjusted operating profit margin* was 2.1% pts higher at 780.6 683.5 3.6 5.3 29.3% and diluted adjusted EPS* rose 34.5% to 53.4p. Biennial Events revenue 85.8 28.1 The Group delivered strong cash flow in 2017 together with Total Events revenue 866.4 711.6 3.6 5.3 cash conversion of 100.3%. Net debt reduced by £85m to Total Events revenue was £866.4m (2016: £711.6m), benefiting £511m at the end of the year. The ratio of net debt: EBITDA* from good underlying growth in Annual Events, an FX tailwind of decreased to 1.6 times (2016: 2.4 times) and the Group ended £22.7m, revenue from acquisitions (which in 2016 had generated the year back inside the target corridor for leverage set out in £60.1m of Annual Events revenue) and the biennial ‘up’ year its financial policy. effect. During the period we rationalised 29 events which had The Board has declared a final dividend of 18.0p to give a full contributed £11.2m of Annual Event revenues in 2016 and we year dividend of 23.5p which is up 6.8% on last year. disposed of events which had contributed £10.3m of revenues in 2016.

Marina Wyatt Chief Financial Officer

36 UBM Annual Report and Accounts 2017 Adjusted underlying* revenue from Annual Events, which The remaining sectors other than ‘Fashion’ and ‘Life Sciences’ all Strategic report excludes the impact of portfolio rationalisation, grew 5.3% in showed improvements in the rate of growth compared to 2016. 2017 (2016: 3.1%). Underlying* revenue from Annual Events ‘Jewellery’ returned to growth in 2017, up 1.8%, driven by a good grew 3.6% (2016: 1.0%). The overall growth of the events performance at the flagship September Hong Kong Jewellery & portfolio improved significantly during 2017, with strong Gem show. growth from the existing portfolio (particularly in Asia), a good ‘Fashion’ revenues were down 4.9%, broadly in line with our contribution from new launches (most notably CPhI North expectations. We continue to invest in this important sector, America) and growth in the Allworld events. This performance

in initiatives to improve our market penetration, to expand into Governance was tempered in part by the weaker North American adjacencies and to make the events “must-attend” for visitors by Fashion portfolio. improving the educational and experiential content at the shows. Biennial Events contributed £85.8m of revenue (2016: £28.1m) During 2017 we successfully launched the IFF MAGIC Japan reflecting the ‘up’ year portfolio and inclusion of revenue from Spring and Fall editions. Excluding these launches the revenue Allworld biennial events, most notably HOFEX and Food & Hotel of Fashion was down 6.6%. Indonesia. The existing UBM portfolio of biennial events showed ‘Life Sciences’ & ‘Healthcare’ events is a small US, mainly 7.6% growth over their 2015 editions (3.7% CAGR) with good conference, business which keeps practitioners appraised of growth in Food Ingredients Europe partially offset by expected Financial statements regulatory changes. It was down 6.4% reflecting US healthcare softness at Marintec China. regulatory uncertainty in 2017. Unless otherwise stated, all commentary below relates to adjusted underlying* revenue growth for Annual Events.

2017 – Annual Events Revenue 2017 – Annual Events Revenue

Food, Hospitality & Leisure : 8% North America: £326m Resources: 1% China (incl. HK): £228m Pharma & BioPharm: 12% Other Emerging Markets: £112m Lifestyle & Brands: 15% Continental Europe: £64m Transport & Logistics : 2% UK: £30m

Technology: 14% ROW: £20m Advanced manufacturing: 10% Business services & Infrastructure: 5% Jewellery & Gem: 9% In 2017, North America accounted for 41.7% of Annual Events Fashion: 20% revenue (2016: 43%), China (including HK) 29.2% (2016: 30%) Life Sciences & Healthcare: 4% and Emerging Markets 14.4% (2016: 10.5%). The increase in Emerging Markets principally relates to the addition of the The ‘Food, Hospitality & Leisure’ events grew 15.3%, helped by Allworld events, the largest of which take place in Singapore, the additional capacity created by running Hotelex and Fine Food Indonesia and Malaysia. over two phases. During 2017 North American revenue grew 0.2% with good ‘Pharma & BioPharm’ was up 13.2% with double-digit growth at performances in the ‘Technology’, ‘Pharma & BioPharm’, CPhI Worldwide and its co-located events, and strong growth ‘Advanced Manufacturing’ and ‘Transport & Logistics’ sectors at CPhI China and CPhI India coupled with the successful CPhI offset by ‘Fashion’ and ‘Life Sciences’. North America launch. China (including HK) revenue grew 9.4% in 2017, with particularly ‘Lifestyle & Brands’ grew 12.5%, with particularly strong strong growth in the ‘Lifestyle & Brands’, ‘Food, Hospitality & performances at Furniture China, Cosmoprof Asia and CBME Leisure’ and ‘Pharma & BioPharm’ sectors. This strong growth China, which are being helped by the growing affluence and was moderated slightly by the lower growth of ‘Jewellery’. aspiration of the middle class in China. ‘Technology’ events grew by 7.6% with particularly strong growth at our cybersecurity event, Black Hat, and CommunicAsia which more than offset the impact of the refresh of InteropITX into a smaller, more focused event.

UBM Annual Report and Accounts 2017 37 Operating and Financial Review continued

Emerging Markets revenue grew 6.5%, principally driven by Adjusted operating profit* was £295.6m, up from £229.1m strong growth in South East Asia, which was partially offset by in 2016. The Annual Events adjusted operating margin* was weakness in the much smaller businesses in Turkey and Brazil. 33.2% (2016: 32.3%). This strong margin progression was driven by drop-through from the faster organic growth, further In Continental Europe revenue rose 10.2% principally driven by procurement savings, overhead recovery in the biennial ‘up’ year, the strong performance in our ‘Pharma & BioPharm’ events. and from the benefits from rationalising and disposing of lower- Revenues in the UK rose 5.7% driven by good growth in our margin events. The FX tailwind added 0.2%pts of margin during ‘Technology’ and ‘Lifestyle & Brand’ events. The Rest of World the year while cost actions helped to reduce the negative margin events rose 24.8%, principally reflecting the successful launch impact of the revenue contraction in ‘Fashion’. of the two fashion events in Japan. The Total Events adjusted operating margin* of 34.1% FY 2017 FY 2016 (2016: 32.2%) also benefited from the higher biennial margins in Events £m £m the ‘up’ year (2017: 42.5%; 2016: 29.3%) from the UBM portfolio Annual – adjusted operating profit* 259.1 220.8 together with the impact of including the Allworld biennials for Annual – adjusted operating profit margin* 33.2% 32.3% the first time. Biennial – adjusted operating profit* 36.5 8.3 Biennial – adjusted operating profit margin* 42.5% 29.3% Total adjusted operating profit* 295.6 229.1 Total adjusted operating profit margin* 34.1% 32.2%

Operating review – Other Marketing Services (OMS)

OMS revenue declined by 2.2% on an adjusted underlying basis. We rationalised and disposed of various non-aligned activities which had generated £11.3m and £7.2m of OMS revenue respectively, in the 2016 comparative. The remaining online activities showed good adjusted underlying growth of 4.8%. However, our print business (which represents only 5.3% of total Group revenue) declined by 11.6%. This reflects the ongoing migration of the business from print into digital format but also, our Life Sciences business was specifically affected by market issues with the reduced level of mainstream drug approvals given uncertainties over healthcare reform in the US. The business is well-positioned to manage the ongoing migration from print to digital. Adjusted operating profit* was £19.4m (2016: £24.1m), representing an operating margin* of 14.2% (2016: 16.0%). The reduction in the margin was driven by the decline in print revenues and, as a result, cost savings actions were taken towards the end of the year. Adj. FY 2017 FY 2016 Underlying underlying £m £m change* % change* % OMS – Online 83.2 88.2 -2.6 4.8 OMS – Print 53.3 63.2 -19.1 -11.6 Total OMS revenue 136.5 151.4 -9.8 -2.2 Adjusted operating profit* 19.4 24.1 Total adjusted operating profit* margin 14.2% 16.0%

38 UBM Annual Report and Accounts 2017 Financial review Adjusted Adjusting IFRS Adjusted Adjusting IFRS Strategic report results* items results results* items results Summary income statement 2017 2017 2017 2016 2016 2016 £m £m £m £m £m £m Continuing Revenue 1,002.9 – 1,002.9 863.0 – 863.0 Operating profit 294.2 (82.2) 212.0 234.8 (82.1) 152.7 Net financing expense (25.4) 5.1 (20.3) (26.3) (6.3) (32.6) Profit before tax 268.8 (77.1) 191.7 208.5 (88.4) 120.1 Governance Tax charge (43.0) 3.0 (40.0) (29.2) 6.4 (22.8) Profit for the year continuing 225.8 (74.1) 151.7 179.3 (82.0) 97.3 Discontinued operations Profit after tax – – – 26.3 – 26.3 Profit on disposal – 7.8 7.8 – 380.9 380.9 Profit for the year total Group 225.8 (66.3) 159.5 205.6 298.9 504.5 Financial statements Non-controlling interest (13.5) – (13.5) (13.0) – (13.0) Attributable profit 212.3 (66.3) 146.0 192.6 298.9 491.5 Earnings per share (pence) Continuing operations – basic 54.0 (18.9) 35.1 40.1 (19.8) 20.3 Continuing operations – diluted 53.4 (18.6) 34.8 39.7 (19.6) 20.1 Total Group – basic 54.0 (16.9) 37.1 46.4 72.1 118.5 Total Group – diluted 53.4 (16.6) 36.8 45.9 71.4 117.3 Share count (weighted average, m) 393.2 393.2 414.9 414.9 Share count (fully diluted, weighted average, m) 397.2 397.2 419.2 419.2 All non-IFRS measures are noted with a ‘*’ and additional information on these measures is set out on page 170.

Revenue Adjusted operating profit*

£m £m 5.3% Annual events adjusted underlying growth1 5.3% Annual events adjusted underlying growth1 -2.2% OMS adjusted underlying growth1 -2.2% OMS adjusted underlying growth1 3.7% Biennial events CAGR2 1,002.9 3.7% Biennial events CAGR2 1,002.9 25.8 25.8 294.2 24.0 24.0 8.6 (2.8) (2.8)12.8 (2.0) (22.5) 34.8 (22.5) 34.8 80.6 £11.2m Events 80.6 £11.2m Events (5.0) 863.0 £11.3m OMS 863.0 £11.3m16.3 OMS

28.7 234.8 s s s s s s 6 n n 6 6 X 7 X X 7 7 o o F F F 20 1 20 1 20 1 20 1 OMS 20 1 20 1 OM S OM S events Annual isat i isat i events l l Annual Annual Biennia l events events events events Product Product Biennia l Biennia l Corporate Acquisition Acquisition Acquisition and disposal and disposal and disposal rationa rationa strategic opex) operations (inc

1 Adjusted underlying growth rates adjust for the effects of acquisitions, disposals, FX movements, biennial events, peripatetic events, phasing and Adjusted operating profit* portfolio rationalisation. Adjusted operating profit* rose by 25.3% to £294.2m 2 CAGR adjusts for the effects of acquisitions, disposals, FX movements, (2016: £234.8m) reflecting the positive contribution from phasing and portfolio rationalisation. acquisitions, mainly Allworld, and from annual and biennial events offset in part by a reduction in OMS. The increase in Annual Revenue Events was delivered by growth across the portfolio with the exception of the ‘Fashion’ and ‘Life Sciences’ verticals which Revenue in 2017 was £1,002.9m, up 16.2% (2016: £863.0m) declined. Continued progress was made on the procurement largely due to the Allworld acquisition, strong organic event programme with aggregate annual savings of £10.3m delivered growth, a biennial ‘up’ year and favourable FX movements. by the end of 2017. This was partially offset by the impact of the final year of the product rationalisation programme under Events First. The adjusted operating margin* grew to 29.3% (2016: 27.2%) On an adjusted underlying basis, revenue grew 4.1% with with strong performances in Annual and Biennial Events together 5.3% growth in Annual Events offset in part by a 2.2% decline with the benefit of the biennial ‘up’ year and the FX tailwind. in OMS. On a reported basis, operating profit from operations of £212.0m increased 38.8% (2016: £152.7m) mainly due to the operating performance noted above whilst adjusting items of £82.2m (2016: £82.1m) were consistent with the prior year.

UBM Annual Report and Accounts 2017 39 40 Strategic capital expenses Strategic operating expenses £m − − Non-recurring items included: £23.7m (2016: £24.1m). Corporate costs before non-recurring items decreased by 1.7%to Total corporate costs increased to £20.8m (2016: £18.4m). Total corporate costs Pension credits Restructuring Light Reading income Non-recurring Total Income from JVs, associates and investments Non-cash share-based payments Pension administration and service cost Ongoing corporate costs £m operating expense Corporate operations and strategic items in the income statement compared with the prior year. above together with the impact of alower level of adjusting 34.8p increased 73.1%(2016: 20.1p) dueto the factors explained On areported basis, diluted EPSfrom continuing operations of less the increase in the tax charge. the main driver of the increase together with the benefit of FX, benefit during the year. The earnings growth in the period was (2016: 39.7p). The share consolidation in 2016 added 2.2pof Continuing diluted adjusted EPS*increased by 34.5%to 53.4p Diluted adjusted EPS*–continuing Operating and Financial Review continued − − Diluted adjusted EPS*–continuing Restructuring charges in relation to corporate functions. for ahigher starting pension; and greater flexibility by exchanging future increases in return initiative to allow members of the UBMPension Scheme Pension credit in 2017 related to the finalisation of an pence 39.7 2016

Share 2.2 consolidation

Adjusted 12.4 operating profit* 0.5 Net interest (3.2) Tax

Minority (0.1) interests 20.8 23.7 (4.3) 2017 2017 21.5 (1.5) 6.7 9.2 2.7 1.0 1.4 1.9

– FX 53.4 2017 2016 2016 (5.0) 18.4 (0.7) 24.1 21.3 (1.5) 3.6 3.2 7.2 1.1 – − − − − − Total income statement adjustments Total exceptional items Exceptional items associates Tax onshare of profits from JVs and acquisition Amortisation –intangible assets on £m items was £82.2m(2016: £82.1m). continuing operating profit for adjustments and exceptional adjusted operating profit* of £294.2m.The total charge to adjustments that have beenexcluded from the continuing The following table provides asummary of the income statement Income statement adjusting items from £3.6min 2016. was invested in CRMplatform development during the year, up in Events, £1.1min OMS). Strategic capital expenditure of £9.2m development; £5.8min Events and £0.9m in OMS (2016: £6.1m £6.7m included costs relating to CRMand Marketing system implementation of the Events First strategy. Strategic opex of Strategic operating and capital expenses relate to the Disposal gains and losses Acquisition exceptional items − − − − − in a gain of £2.6m. EMEA portfolio completed on8September 2017 resulting Non-core businesses: the disposal of four events from the incurred in 2017 in respect of the Informa transaction. Transaction costs of £2.4mrelate to professional fees on prior year acquisitions. (2016: £0.4m charge) for changes in earnout estimates bolt-on acquisitions. This was offset by acredit of £1.1m to duediligence and professional fees for Allworld and Acquisition costs in the year of £2.2mrelated mainly balance being incurred over the next two years. Total integration costs of $20mare expected with the consultancy fees for the operations and finance integrations. the period primarily relating to restructuring costs and Allworld integration costs of £5.1mwere incurred during fees. processes. BJI costs related mainly to venue contract break the Americas business including alignment and migration of the concluding elements of the operational integration into integrations were completed. Advanstar costs related to £3.1m respectively were incurred during the year as the Advanstar and BJI integration costs of £8.0m and Transaction costs Impairment − − − Disposals Acquisition costs and earnout changes Allworld integration costs Advanstar and BJI integration costs − − − Ecobuild Investments and associates Non-core businesses UBM Annual Report and Accounts 2017 64.5 82.2 (2.6) 2017 17.1 0.6 11.1 2.4 5.1 1.1 – – – 36.5 (11.2) 2016 (9.2) 82.1 45.1 35.1 11.3 0.5 3.4 7.1 – – Net financing expense The total cash paid in respect of income taxes in 2017 was Strategic report The net interest expense of £25.4m (2016: £26.3m) represents £42.2m (2016: £39.1m). The table below is a reconciliation of the interest payments on our US Dollar bond, US Private Placement 2017 expected tax charge to actual cash tax paid: Loan Notes, bank loans and pension interest, net of interest Exceptional receipts on cash holdings. The net expense for the year is lower and other than the prior year primarily due to the beneficial interest charge adjusting £m Adjusted items IFRS on the US Private Placement Loan Notes and the $365m bridge Expected tax charge at UK rate facility during 2017. In the prior year, the £250m Sterling bond 51.7 (14.8) 36.9 Governance was in place until November 2016 which incurred a higher rate Different tax rate on overseas earnings of interest. 24.0 (8.5) 15.5 UBM tax charge at weighted Discontinued operations average tax rate 75.7 (23.3) 52.4 US goodwill amortisation (19.4) – (19.4) The PR Newswire (PRN) disposal completed on 16 June 2016 and a gain on disposal was reported in 2016. During the year, Effects of intragroup financing (18.2) – (18.2) the Group recognised an additional £7.8m gain primarily due to Accruals for uncertain tax

positions and deferred tax Financial statements the release of expired provisions for warranties and indemnities (1.6) (19.0) (20.6) which were originally recognised in accordance with specific Exceptional deferred tax charge – 16.6 16.6 clauses in the sale agreement. Other adjustments 6.5 22.7 29.2 Tax charge 43.0 (3.0) 40.0 Tax Exclude deferred tax and JVs and Current tax associates tax (6.3) 3.0 (3.3) Our tax charge on adjusted operating profit* was £43.0m Exclude accruals for uncertain (2016: £29.2m), representing an effective tax rate* for the year tax positions 7.3 – 7.3 of 16.0% (2016: 14.0%). The effective tax rate in the prior year Tax paid in different period to benefited from certain one-off tax settlements which did not charged (1.8) – (1.8) recur in 2017. A bridge showing the main factors affecting the UBM actual tax paid 42.2 – 42.2 2017 effective tax rate is shown below: A breakdown of the main geographies in which we paid tax is as follows: Current tax 2017 £m

£m 28.2 China 17.0 Europe 12.5 8.9 -7.2 19.3 Emerging Markets 8.9 -6.8 16.0 Rest of World 3.0 2.4 -0.6 United States 0.8 Total 42.2 Our current tax liability as at 31 December 2017 was £52.6m (2016: £60.9m). Other Tax at Movements in the liability during 2017 were as follows: tax rate earnings financing Effects of intragroup 7 adjusted on overseas US goodwill UK tax rate adjustments Accruals and deferred tax amortisation 20 1 statutory rates Higher tax rate £m Current tax liability at 1 January 2017 60.9 Current tax charge 36.7 In December 2017 the US Tax Cuts and Jobs Act was enacted. Tax paid (42.2) This Act made significant changes to US tax rules, the most Currency translation and other movements (2.8) relevant to the Group being the reduction in the federal rate of tax to 21%, the reduction in the amount of interest that can Current tax liability at 31 December 2017 52.6 be deducted for tax purposes and the introduction of other measures designed to combat base erosion. The combined effect of these changes will not have a material impact on the Group’s adjusted tax rate.

UBM Annual Report and Accounts 2017 41 Operating and Financial Review continued

The current tax liability includes £35.9m (2016: £45.6m) Cash flow in respect of accruals for uncertain tax positions in various Conversion of adjusted operating profit* into cash jurisdictions in which UBM operates. We have necessarily made The ability to turn profits into cash is a key focus for judgements as to the outcome of tax matters not concluded. management, as it provides the funds necessary to invest in The current tax liability has been consistently classified as a the business. We track this using the cash conversion* measure short-term liability in accordance with our accounting policy. which expresses our adjusted cash generated from operations* The current tax liability can be further analysed as follows: as a percentage of adjusted operating profit*. Cash conversion* By geography % varies in line with our biennial cycle and event phasing. China 30.5 £m 2017 2016 United States 25.1 Adjusted operating profit* 294.2 262.9 Europe 21.6 Depreciation 17.4 17.5 Emerging Markets 20.0 Capital expenditure (20.9) (11.7) Rest of World 2.8 Movement in working capital and other non- Total 100.0 operating items 4.3 (15.8) Adjusted cash generated from operations* 295.0 252.9 By year % Cash conversion* 100% 96% Up to 2013 6.5 Cash conversion* at 100% (2016: 96%) increased principally 2014 19.2 due to a positive working capital result in a biennial ‘up’ year. 2015 14.8 Capital expenditure for the year was £20.9m (2016: £11.7m), and 2016 18.5 £9.2m of this expenditure related to the strategic spend on our 2017 41.0 new CRM platform. Total 100.0 Free cash flow* Free cash flow* was £204.1m (2016: £159.6m). Deferred tax During the year deferred tax assets recognised in respect of £m 2017 2016 tax losses and other temporary differences reduced by £7.1m, Adjusted cash generated from operations* 295.0 252.9 bringing the total assets recognised to £19.7m. These assets Payments for non-operating items (16.2) (13.8) have been recognised because the Group expects to generate Payments against provisions (5.4) (11.9) taxable profits against which they will be used in the future. Pension deficit payments (3.3) In addition, at 31 December 2017 the Group had unrecognised (3.3) deferred tax assets, including those relating to tax losses carried Interest paid (23.8) (25.2) forward, further details of which are included in Note 3.6. Tax paid (42.2) (39.1) Free cash flow* 204.1 159.6 Our total tax contribution Our contribution to the economies in which we operate is Adjusted cash from operations* was £295.0m, whilst free cash flow* predicated on our ability to run successful, profitable businesses was £204.1m. Dividend payments and purchases of shares totalled that generate employment, stimulate economic growth and £104.4m. contribute to tax revenues. This is particularly important Free cash flow* increased because of the cash generated by in Emerging Markets where the taxes which we pay to, and Allworld’s operations and by the existing events portfolio in a biennial collect on behalf of, governments is an important part of our ‘up’ year, partially offset by higher levels of spend on non-operating economic footprint. items such as integration costs and tax. We completed the acquisition In the year ended 31 December 2017, our total tax contribution of the Bahrain business of Allworld and made four additional bolt-on was £66.8m (2016: £61.0m), this includes corporate income tax acquisitions in the year as well as one disposal (consisting of four on our profits, as well as employee taxes and any other taxes events), resulting in a £69.9m increase to net debt* offset by a that we bear. The geographical split of our total tax contribution favourable FX movement on US Dollar denominated debt. is as follows: Cash flow Emerging Markets US Other Total 596.8 Free cash flow* £204.1m Profit taxes borne 25.9 0.8 15.5 42.2 69.9 (55.7) Employment taxes 511.3 borne 3.8 8.0 7.4 19.2 (295.0) 104.4 Other taxes (e.g.

business rates) 1.7 1.2 2.5 5.4 66.0 8.7 Total 31.4 10.0 25.4 66.8 16.2 In addition to the above, in 2017 we collected taxes on behalf of governments (e.g. employee taxes and sales taxes) amounting

to £65.7m (2016: £56.2m). items generated Net debt* Net debt* Provisions & pensions 31 Dec 2017 31 Dec 2016 Dividends & Acquisitions Adjusted cash FX/Fair value Interest & tax Non-operating share purchase net of disposals from operations* 42 UBM Annual Report and Accounts 2017 Reconciliation of IFRS to adjusted cash generated Capital structure Strategic report from operations* Net debt* £m 2017 2016 Our net debt* at 31 December 2017 was £511.3m, a ratio of Adjusted cash generated from operations* 295.0 252.9 1.6 times EBITDA* (Proforma 2016: 2.3 times). Dividends from JVs and associates (0.5) – Our Financial Policy targets a leverage ratio of between Capital expenditure 20.9 11.7 1.5–2.0 times net debt/EBITDA* which provides flexibility for Payments against provisions (5.4) (11.9) biennial cycles, capacity to invest in bolt-on acquisitions, and Pension deficit payments (3.3) (13.3) is consistent with investment grade metrics. There is flexibility Governance Acquisition and disposal cost payments (8.4) (30.3) to move outside the corridor (up to 2.5 times and down to 1.0 times), specifically due to M&A activity, with the intention of Other adjustments (16.2) (13.8) returning into the corridor within 12-18 months. We have held Cash generated from operations (IFRS) 282.6 194.8 investment grade ratings from each of Standard & Poor’s and Moody’s for over nine years. The Group continues to maintain Acquisitions a credit rating of BBB- for Standard and Poor’s and a rating of We invested £48.4m in the acquisition of Arabian Exhibition Baa3 for Moody’s, with Standard & Poor’s outlook stable and Financial statements Management WLL (AEM), the Bahrain business of Allworld Moody’s having upgraded their outlook to stable during the year. Exhibitions which completed in January 2017. Completion of the acquisition of AEM was the final piece of the Allworld Exhibitions Proforma £m 2017 20168 2016 transaction, the rest of which had completed in December 2016. Cash (89.0) (84.8) In addition, we invested a total of £13.6m acquiring Marmara, (77.7) AMA Research, Green Thinking Services and The Aesthetic Borrowings and associated derivatives 730.2 681.6 Show. We also acquired the remaining 20% shareholding of 589.0 6 Rotaforte for cash consideration of £2.0m. Payments for Net debt* 511.3 641.2 596.8 contingent and deferred consideration for acquisitions made in EBITDA*7 311.6 275.8 252.3 prior years totalled £8.0m. Net debt to EBITDA ratio* 1.6 times 2.3 times 2.4 times The 2017 acquisitions (excluding AEM) contributed adjusted 6 Includes fair value adjustments. 7 2016 is continuing operations only. operating profit* of £0.2m in 2017 following acquisition. 8 Includes Allworld proforma earnings of £23.5m, AEM consideration of £48.6m The combined return on investment from the bolt-on and cash acquired of £4.2m. acquisitions in the past three years is 13.0% with 2017 acquisitions contributing 9.4% in their first year. Including the Debt facilities larger acquisitions the return on investment for the past three Our funding strategy is to maintain a balance between continuity years is 8.8%. The return on investment target framework of funding and flexibility through the use of capital markets, requires acquisition returns in excess of our cost of capital in the bank loans and overdrafts. first full year of ownership. The framework adjusts the cost of During the year, to replace the $365m bridge facility which was capital used and the period over which the return target must be put in place in December 2016 to fund the Allworld acquisition, reached to take into account the risk resulting from the scale, $370m US Private Placement Loan Notes were issued on 15 June country, sector and complexity of the acquisition. 2017 in three tranches: $45m of five-year notes, $175m of The following table shows the performance of our acquisitions seven-year notes and $150m of ten-year notes. since 2015:

Consideration3 Return on investment* £m 20174 2016 2015 2015 acquisitions 34.6 11.3% 11.2% 9.5% 2016 acquisitions 85.2 13.9% 9.9% – 2017 acquisitions 6.4 9.4% – – 13.0% 2014 acquisitions – Advanstar 599.0 9.5% 10.7% 10.3% 2016 acquisitions – Allworld5 383.0 6.3% – – Total – all acquisitions 1,108.2 8.8% 3 Excluding working capital adjustments and including the earned contingent consideration. 4 2017 return on investment only includes acquisitions where an event has traded under UBM ownership. 5 Includes Bahrain.

UBM Annual Report and Accounts 2017 43 Operating and Financial Review continued

At 31 December 2017, we had drawn £57.5m from the revolving credit facility, leaving an un-utilised commitment of £342.5m available. Our debt facilities and maturities as at 31 December 2017 are summarised below:

£m Facility Drawn Undrawn Maturity Margin % Fair value hedges $45m US PP – tranche A 33.3 33.3 – Jun 22 LIBOR + 1.65% $175m US PP– tranche B 129.5 129.5 – Jun 24 4.45% fixed Floating rate swap for $78m US LIBOR + 2.09% $150m US PP– tranche C 111.0 111.0 – Jun 27 4.68% fixed $350m fixed rate Dollar bond 259.0 259.0 – Nov 20 5.75% fixed Floating rate swap for $100m US LIBOR + 2.65% £400m revolving credit facility 400.0 57.5 342.5 Apr 22 LIBOR + 0.6% Total 932.8 590.3 342.5

Pensions Related party transactions UBM operates defined benefit and defined contribution Details of related party transactions in the 12 months ended schemes, based primarily in the UK. 2017 is a triennial valuation 31 December 2017 are disclosed in Note 8.2. year for the UBMPS and UNEPS defined benefit schemes where the Pension Scheme Trustees review the level of funding and Foreign currency agree with UBM the future level of contributions to the scheme. The Group closely monitors its exposure to foreign currencies, At 31 December 2017, the aggregate deficit under IAS 19 and seeks to match revenue and costs when possible. was £5.8m, a reduction of £44.8m compared to the deficit The revolving credit facility may be drawn in currencies other of £50.6m at the previous year end. This is primarily due to than Pound Sterling. We also hold cash and cash equivalents improved asset performance and updated mortality projections in Pound Sterling, the Renminbi and US Dollars and other and member data following the triennial valuation. This has currencies closely linked to the US Dollar. Given our large and been offset in part by a reduction to the discount rate due to diverse customer base, there are no significant concentrations market movements. of credit risk. The following table outlines the currency profile of our revenues Return on Average Capital Employed (ROACE)* and adjusted operating profit* for 2017: ROACE* is defined as post tax adjusted operating profit* over average shareholders’ funds plus net debt* (average capital Adjusted Year on employed). Capital employed has been adjusted for impairment operating year FX Revenue profit* Average exchange rate movement charges from 1 January 2016 onwards. £m £m 2017 2016 %

10 Adjusted US Dollar 444.8 139.4 1.28 1.35 -5.09% £m 2017 20169 Hong Kong 10 Post tax adjusted operating profit* (£m) 251.2 205.6 Dollar 131.1 61.2 10.34 10.15 1.87% 10 Average capital employed (£m) 1,831.0 1,398.1 Renminbi 127.8 38.9 8.82 8.85 -0.27% Return on average capital employed* UK Pound (ROACE) (%) 13.7% 14.7% Sterling 67.0 (27.8) 1.00 1.00 – 9 Continuing operations and excluding Allworld capital employed at Euro 81.0 43.5 1.13 1.15 -1.77% 31 December 2016. Indian Rupee 22.5 8.6 85.75 86.61 -1.00% ROACE* has decreased since 2016 as the inclusion of Allworld’s Singapore capital employed and respective earnings are incorporated into Dollar 23.3 5.1 1.76 1.85 -4.69% the measure. Japanese Yen 24.7 7.1 143.34 148.20 -3.28% Brazilian Real 14.4 2.1 4.20 4.87 -13.86% Other 66.3 16.1 – – – Total 1,002.9 294.2 10 $ or quasi-$ pegged

44 UBM Annual Report and Accounts 2017 Approximately 70% of UBM’s revenues are generated in US Statement of going concern and Directors’ Strategic report Dollars or quasi-dollar pegged currencies, which has benefited responsibilities the Group’s reported financials given FX movements in 2017. The FX benefit added £25.8m to revenue and £8.6m to adjusted After making enquiries, the Directors have a reasonable operating profit* during the year compared to 2016. expectation that UBM has adequate resources to continue in operational existence for the foreseeable future. Accordingly, The income statement exposure to foreign exchange risk is they continue to adopt the going concern basis in preparing the shown for our most important foreign currency exposures in the financial statements. In reaching this conclusion, the Directors

sensitivity analysis below, based on 2017 operations: have had due regard to the following: Governance

Effect on −− After taking account of available cash resources and adjusted committed bank facilities, none of UBM’s borrowings fall Average Effect on operating exchange rate Currency value revenue profit*11 due within the next 12 months that require refinancing from in 2017 rises/falls by +/– £m +/– £m resources not already available. US Dollar 1.28 1% 4.4 1.4 −− The cash generated from operations, committed facilities HK Dollar 10.34 1% 1.3 0.6 and UBM’s ability to access debt capital markets, taken

Renminbi 8.82 1% 1.3 0.4 together, provide confidence that UBM will be able to meet Financial statements Euro 1.13 1% 0.8 0.4 its obligations as they fall due. 11 The actual impact of currency on Group profit may be different to that implied Further information on the financial position of UBM, its cash due to the timing of profit receipts, with financials translated on a monthly basis flows, financial risk management policies and available debt using the average for that month. facilities are described in my review on the preceding pages. Dividends UBM’s business activities, together with the factors likely to impact its future growth and operating performance are set out Our existing progressive dividend policy, which targets in the Strategic Report. two times cover through economic and biennial cycles, is unchanged for 2017. The Board has declared a final dividend Signed on behalf of the Board by of 18.0p (2016: 16.6p) to give a full year dividend of 23.5p (2016: 22.0p), an increase of 6.8% on prior year and dividend cover of 2.3 times. The final dividend will be paid on 24 May 2018 to shareholders on the register at close of business on 20 April 2018. The Board undertook a review of the dividend policy during 2017 and confirmed a new policy to take effect from 2018. Marina Wyatt The revised policy is to pay a progressive dividend centred Chief Financial Officer around 2x cover through economic and biennial cycles and 27 February 2018 taking into consideration the impact from currency movements. The policy has also been revised so that the interim dividend will in future represent approximately one-third of the expected full year dividend.

UBM Annual Report and Accounts 2017 45 Underpinning our ability to deliver our strategy

In this section

Governance report Board of Directors 47 Corporate Governance Statement 50 Nominations Committee 52 Leadership 54 Effectiveness 57 Audit Committee 61 Directors’ Remuneration Report 68 Directors’ Report 87

46 UBM Annual Report and Accounts 2017 Board of Directors

Board members have a diverse range of skills and Strategic report experience, providing stewardship, leadership and oversight of the Events First strategy.

1 Tim Cobbold Governance Chief Executive Officer Appointed: 2014

Tim has substantial experience of leading complex international businesses, in the manufacturing, power and technology sectors, having previously been the CEO of two FTSE 250 businesses.

2 Greg Lock N R

Non-Executive Chairman Financial statements Appointed: 2010 (and appointed Non-Executive Chairman in January 2018)

Greg brings significant experience in the technology, software and computer services industry, having spent 30 years at IBM in a wide range of senior roles in the UK, Europe and US.

1 2

3 John McConnell A N Non-Executive Director Appointed: 2014

John has extensive financial experience in the capital markets, automotive and health sectors. His technical, regulatory and compliance knowledge is critical to his role as Chairman of the Audit Committee.

4 Marina Wyatt Chief Financial Officer Appointed: 2015

Marina has wide-ranging financial and international experience from the technology, telecoms and resource management sectors. Marina provides effective oversight of the Group’s finance, tax, treasury and internal audit teams. 3 4

Committee membership key Tenure

A Audit Remuneration R <1 year: 1 Director N Nominations 1–3 years: 3 Directors 4–7 years: Denotes Committee Chair 3 Directors 8+ years: 2 Directors

UBM Annual Report and Accounts 2017 47 Board of Directors continued

5 Terry Neill A N Non-Executive Director Appointed: 2009

Terry has extensive global experience in leading and delivering large-scale projects and managing transformational change in a range of sector from his executive roles at Accenture and Andersen Worldwide.

6 Warren Finegold N R Senior Independent Director Appointed: 2017

Warren combines a knowledge of the technology markets with significant experience in investment banking. Warren was Group Strategy and Business Development Director at Vodafone, Managing Director of UBS Investment Bank and Executive Director 5 6 at Goldman Sachs International.

7 Trynka Shineman A N Non-Executive Director Appointed: 2016

Trynka has extensive experience of marketing for online businesses, driving change and growing businesses, in the marketing, consumer and technology sectors and is currently CEO of Vistaprint.

8 Mary McDowell N R Non-Executive Director Appointed: 2014

Mary is the CEO of Polycom. She has a strong background as a technology industry executive and has led global businesses in the mobile, consumer and enterprise sectors. She has a proven track record for sustaining strong financial performance and leading 7 8 9 scalable technology innovation.

9 David Wei N R Non-Executive Director Appointed: 2016

David built his career in the investment, management and growth of complex businesses operations in China in financial services, capital investment, retail and e-commerce. He was previously CEO of Alibaba.com.

Gender diversity – female representation Nationalities represented 33% 50% 37.5% 5 Group Board Executive Directors Executive Committee

48 UBM Annual Report and Accounts 2017 Strategic report Additional biographical details and skills matrix

Name Sector Experience Current External Appointment AnalogousPlc/NED sector/contentDigital/TechnologyUS EmergingSitting Markets ExecutiveFinance,Operational CapitalConsumer/marketing Markets experiencePeople and transformation Governance Greg Computer Services −− Chairman at Computacenter plc −− Development Board Member and Fellow Lock Software        Technology of Churchill College, Cambridge

Tim Manufacturing −− NED of Drax plc Cobbold Power Technology        Financial statements

Marina Resource Management −− NED of Renewi plc Wyatt Technology −− Member of the Supervisory Board Telecoms at Lucas Bols B.V. (The Netherlands)         

Warren Investment Banking −− Adviser to the Vodafone Group Finegold Technology −− NED at Inmarsat plc. Telecommunications −− Member of Supervisory Board of Avast        Holding BV (The Netherlands)

John Automotive −− CEO and Managing Director of Automotive McConnell Capital Markets Holdings Group Limited (Australia) Health      

Mary Consumer −− CEO of Polycom (US) McDowell Technology −− NED and Chair of Compensation Telecommunications Committee of Autodesk Inc (US)         

Terry Accounting −− Non-Executive Member of the Institute Neill Banking of International & European Affairs Construction −− Member of Trinity College Dublin       Professional Services Foundation Board −− Chair of Council of Wexford Festival Opera

Trynka Consumer −− CEO of Vistaprint (US) Shineman Marketing        Technology

David Capital Investment −− Chairman and Founding Partner Wei Financial Services of Vision Knight Capital (China) e-Commerce −− NED of PCCW Limited (Hong Kong)          Retail

See www.ubm.com/about-ubm/board-of-directors for more detailed biographies

UBM Annual Report and Accounts 2017 49 Corporate Governance Report Corporate Governance Statement

It is our role as a Board, and mine as Chairman, to ensure that we create a framework and culture that supports good governance, helps to create sustainable long-term value for shareholders and promotes the interests of our key stakeholders.

Dear shareholder The Board spends considerable time Warren has taken part in a comprehensive Notwithstanding the very sad focusing on how the strategy is being induction process, including attending circumstances of my appointment, I am implemented and monitoring progress. the Board Strategy Day in May and pleased to present my first Corporate We also focus on the longer-term twice attending the Audit Committee, Governance Statement as Chairman. future and the implications that a by invitation, bringing him into contact changing marketplace might have for with a wide range of people, both in and The second half of 2017 was a significant the business. We do this in several ways, outside UBM. one for UBM, following the passing of including actively seeking out internal Following my appointment as Non- Dame Helen and the approach from and external perspectives on how the Executive Chairman, Warren has Informa. This highlighted the importance marketplace might develop, the risks and been appointed as the new Senior of the Board's role in providing leadership opportunities which exist and how these Independent Director. and stewardship of the business. are being addressed. Until such time as the transaction with I am pleased to report that, other than The Board has continued to devote time to Informa is completed your Board is two exceptions (detailed on page 51), strengthening risk management systems committed to fulfilling its governance and UBM has in 2017 complied in full with the across the Group and this has generated stewardship responsibilities. principles, and applied the provisions, of thoughtful discussion on risk appetite the UK Corporate Governance Code. At UBM, we have a strong focus on and risk mitigation in both the Audit good governance and doing business in Committee and around the boardroom the right way. It is our role as a Board, table. The approach taken by the Group and mine as Chairman, to ensure that to risk management, and how it tracks we create a framework and culture that and mitigates the principal risks it faces, is supports good governance, helps to intended to enable UBM to respond swiftly create sustainable long-term value for to changing market conditions or external shareholders and promotes the interests events as they arise. Greg Lock of our key stakeholders. This report sets Non-Executive Chairman out our approach to governance and the I am pleased to have welcomed a new work of the Board and its Committees independent Non-Executive Director to during the year. the Board during 2017: Warren Finegold.

50 UBM Annual Report and Accounts 2017 Strategic report Governance structure

Board The Board is collectively responsible for the long-term success of the business. It provides leadership and direction, including setting and overseeing the implementation of the strategy, monitoring management activity and performance, building relationships and trust with our major stakeholders, ensuring that the Group operates within an appropriate risk and control framework, and establishing the culture and values of the organisation. Governance More details on the roles and responsibilities of the Board are set out on pages 54 to 60

Audit Nominations Remuneration Chief Executive Financial statements Committee Committee Committee Officer (CEO) The Audit Committee is The Nominations Committee The Remuneration The CEO is responsible responsible for oversight of reviews the structure, size Committee reviews and for the development and the Group’s financial reporting and composition of the Board recommends to the Board implementation of the processes and significant and its Committees, and the Remuneration Policy and strategy, managing the financial judgements, the makes recommendations to determines the remuneration overall performance of the integrity and clarity of the the Board accordingly. It has packages of the Executive business, and ensuring an financial statements, review responsibility for succession Directors whilst overseeing effective leadership team is of the risk management and planning at Board level the appropriateness in place. internal controls framework, to ensure that the Board of the remuneration and agreeing the scope retains an appropriate and structure for executive and effectiveness of the diverse balance of skills and management and the wider external audit process. experience to effectively lead employee population. The Audit Committee the Company. also directly oversees the process for the selection of the external auditor and makes recommendations for their appointment.

More details are set out More details are set out More details are set out More details are set out on pages 61 to 67 on pages 52 to 53 on pages 68 to 86 on pages 54 to 56

Executive Committee The Executive Committee is led by the CEO and comprises senior management from across the business. Its role is to provide the highest executive level governance and discussion forum, responsible for optimising performance and delivery of strategic objectives. It also assists in the implementation of operating plans, budgets, policies and procedures, and manages the operational and financial performance of the business. More details about the Executive Committee are set out on page 21

Statement of compliance with the UK Corporate Governance Code (the Code) UBM plc is a Jersey incorporated company with a premium listing on the London Stock Exchange. During the 2017 financial year UBM has complied in full with the provisions, and applied the principles of the Code, with the following exceptions: 1. Under Code Provision C.3.1 the company chairman of smaller companies (only) may be a member of the Audit Committee. On taking on the role of Acting Chairman Greg Lock remained as a member of the Audit Committee. 2. Under Code Provision D.2.1 the company chairman may be a member of, but not chair, the Remuneration Committee if he or she was considered independent on appointment as Chairman. On taking on the role of Acting Chairman Greg Lock was the incumbent Remuneration Committee Chairman and remained in that role. The Board considered that, in light of the unusual circumstances, and in order to maintain continuity, it was in the best interests of the governance of UBM that Greg Lock should remain as an Audit Committee member and the Chairman of the Remuneration Committee during the recruitment process for a new Chairman. On his appointment as Chairman on 30 January 2018, Greg Lock stepped down as a member of the Audit Committee and retired as Chairman of the Remuneration Committee.

UBM Annual Report and Accounts 2017 51 Corporate Governance Report Nominations Committee Report

Dear shareholder I am pleased to present our Nominations Committee report for 2017, in what has been a busy year for the Committee. Selecting a new Chairman is one of the most important decisions that a Board can make, and the Committee agreed on the importance of considering as wide a range of candidates as possible. Further details on this process are set out on page 53 of this report. The Committee continued the work started in 2016 on the development of the Board succession plan. In the first part of the year we considered the replacement for Alan Gillespie, who stepped down having served nine years as a Non-Executive Director and Senior Independent Director. I would like to take The Committee has a responsibility this opportunity to thank Alan for his to ensure that there is integrity in the significant contribution over the years. In May, Warren Finegold was appointed as Board appointment process, balancing an Independent Non-Executive Director. the requirements of the business and Following Alan's departure in May 2017, I was appointed as Senior Independent expertise required with a transparent Director and following my appointment as Chairman in January 2018, Warren recruitment process. Finegold has been appointed as Senior Independent Chairman and Chairman of the Remuneration Committee.

Membership The Committee has continued to ensure an appropriate balance of experience −− Greg Lock −− Terry Neill and abilities on the Board. This enables it −− Warren Finegold −− Trynka Shineman to support and constructively challenge management in the implementation and −− John McConnell −− David Wei development of the Events First strategy. −− Mary McDowell

Number of meetings Seven

Reporting Nominations Committee meetings are scheduled to take place shortly Greg Lock before Board meetings. Chairman, Nominations Committee The Chairman reports to the Board.

Attendees by invitation CEO, CFO, Group Company Secretary and executive and non-executive search agencies as appropriate

Terms of Reference www.ubm.com/investor/corporate-governance/nominations-committee

52 UBM Annual Report and Accounts 2017 Purpose Strategic report To ensure that the Board is functioning effectively and, in supporting this objective, to regularly review the size and composition of the Board, giving full consideration to succession planning for Directors and to support management in considering the need for a suitable Governance talent pipeline to meet the future needs of the Group.

Chairman selection process Over the subsequent two weeks each A longlist of candidates was produced As Greg Lock was a candidate, Terry Director met with MWM to refine and reviewed by the Committee. the specification. Five candidates were invited for an

Neill led the Chairman selection process. Financial statements interview with the Chairman, from Mr Lock was not present during A shortlist of candidates was presented to which a shortlist was produced. Committee meetings where his own the Committee in October. The sub-group candidature was discussed. then interviewed four external candidates All members of the Committee then In August 2017 a sub-group of the and recommended a final shortlist of two. met with the shortlisted candidates. The CEO and CFO also met the Committee, comprising Messrs Neill Part-way through this process candidates. The Committee agreed that and Finegold, together with the CEO the Committee had to address the Warren Finegold’s extensive experience and supported by the Group Company ramifications on the process of the in strategy and technology, as well as his Secretary, finalised the draft Chairman's approach by Informa. role specification. Qualities that the investment banking and capital markets Committee considered would be In January 2018, the Committee background, would prove invaluable as required included: determined that it would recommend UBM continues to implement its Events to the Board that Greg Lock should be First growth strategy. −− Proven Chairman (or recent CEO) appointed as Chairman. of a business of global scale and In May 2017 the Committee complexity; Non-Executive Director formally recommended that the selection process Board appoint Warren Finegold −− Analogous sector experience; to the Board, Remuneration and In seeking a replacement for Alan −− Good understanding of UK corporate Nominations Committees. Gillespie, the skills matrix (set out on governance models; page 49) was reviewed to provide a first MWM does not have any other −− Digital experience; step in formulating the role specification. connection with the Company. −− Strong external reputation, well- The matrix sets out the balance of respected by investors; skills on the Board and helps to identify any areas where a skills gap could −− International experience, particularly potentially develop in the near term. in the US and Asia; Qualities that the Committee felt would be −− Ability to build effective working required included: relationships with the CEO and −− Capital Markets/Corporate Finance executive team; experience in a listed company (FTSE) −− An inclusive, respectful and open environment; style that ensures the Board operates −− familiarity operating within a global effectively as a team and is able to group and partnering with joint get the best out of a geographically ventures; and experientially diverse group of Directors. −− M&A and entrepreneurial experience; Three external search firms were −− marketing, technology and systems invited to participate in a tender knowledge; and process. This included a detailed written −− customer-facing experience. proposal and a meeting with the sub- group, following which the sub-group MWM was appointed to search for recommended to the Committee that suitable candidates. MWM Consultants (MWM) be selected, which the Committee approved in September.

UBM Annual Report and Accounts 2017 53 Leadership

Board composition and attendance chart - 2017

Unscheduled Name Role Board Board Nominations Audit Remuneration Dame Helen Alexander Chairman (to 5 August 2017) 2 of 3 – 1 of 2 – 2 of 4 Greg Lock Acting Chairman (from 21 July 2017) 6 of 6 5 of 5 4 of 7 4 of 4 6 of 6 and SID (from 17 May 2017) Tim Cobbold CEO 6 of 6 5 of 5 – – – Marina Wyatt CFO 6 of 6 4 of 5 – – – Alan Gillespie SID (to 17 May 2017) 2 of 2 – 1 of 2 1 of 1 – Warren Finegold NED (from 19 May 2017) 3 of 4 5 of 5 5 of 5 – 3 of 3 John McConnell NED 6 of 6 3 of 5 6 of 7 4 of 4 – Mary McDowell NED 6 of 6 4 of 5 7 of 7 – 6 of 6 Terry Neill NED 6 of 6 5 of 5 7 of 7 4 of 4 – Trynka Shineman NED 6 of 6 5 of 5 6 of 7 4 of 4 – David Wei NED 5 of 6 5 of 5 6 of 7 – 4 of 6

Role of the Board Whilst the Chairman provides To see the full list of Matters The Company’s governance structure leadership of the Board, the day-to-day Reserved for the Board, please visit is based on the principles of the UK management of the Company is delegated www.ubm.com/investor/corporate- Corporate Governance Code. The Board is to the CEO and his senior management governance. Regular updates are provided collectively responsible to shareholders, team (the Executive Committee). on UBM’s finances, operations, strategy and wider stakeholders, for the long-term The Executive Committee assists and development. Standing items include success of the Company. It fulfils this the CEO in operational and strategic written reports from the CEO, CFO, and responsibility by providing leadership, decision-making and the Committee the Group Company Secretary as well setting the strategic goals for the collectively reviews areas such as strategy as reports from the Head of Investor Company and overseeing the execution of implementation, operational and financial Relations and Corporate Communications. the strategy by management. It ensures performance, budget and risk matters The inclusion of a forward agenda in the Company has adequate resources across the Group as a whole. each Board pack provides an overview of these and other matters which are to deliver the Events First strategy How the Board operates and reviews the operating and financial scheduled for discussion over the course There are key decisions that cannot performance of the Group. The Board of the financial year. This is linked be delegated to senior management. ensures that the execution of the to ongoing corporate activity and is These matters reserved for Board strategy and value creation are achieved regularly reviewed. approval are: within a framework of prudent and Papers for Board and Committee meetings effective controls. −− Group strategy, corporate vision and are normally circulated at least six days governance; The Company’s Articles of Association before the relevant meeting. At meetings, and the regulatory environment set −− Three-year financial forecasts, annual presentations are made by Executive the external framework for how the operating and capital expenditure Directors, divisional management and Company operates. The Board is budgets; other senior executives on specific issues. Guidelines have been established for assisted in fulfilling its responsibilities −− Financial statements, going concern such presentations to ensure that the by delegating some of these to each and reporting to the market; of its Board Committees. We describe Board receives adequate information. how the Committees discharge these −− Dividend policy; Sufficient time is built into each agenda responsibilities in this report. Both the −− Acquisitions and disposals, capital for debate and challenge. From a cultural Board and the Committees each have a expenditure or material contracts perspective, Board discussions are held in rolling annual schedule of topics and items above specified spending limits; an atmosphere of transparency, openness and mutual respect, allowing issues to be for discussion. The agendas for Board − Extension of the Group’s activities into − discussed openly within an atmosphere meetings are prepared by the Chairman, new business or geographic areas; assisted by the Group Company Secretary. of supportive challenge. The Board also The same process is adopted for each of −− Resolutions and documentation for meets for dinner before each Board the Board Committees. shareholders; and meeting, often with an invited guest, to −− Changes to the structure, size and discuss a pre-determined topic in a more composition of the Board. informal setting.

54 UBM Annual Report and Accounts 2017 Attendance Board and committee meetings Strategic report Dame Helen Alexander was unable to The Board has six scheduled meetings Board visit to Shanghai – attend one Board, one Nominations and each year and meetings may be convened September 2017 two Remuneration Committee meetings at other times as and when necessary. The Board held a two-day meeting in due to ill-health. In 2017, 11 Board meetings were held in Shanghai, during which the Directors: total, five of which were unscheduled Greg Lock was absent from three to consider the approach by Informa. −− Met local management who gave Nominations Committee meetings where Board meetings are generally held at several presentations on current his candidacy for the role of Chairman Governance UBM’s London office, with one or two performance and future plans in was discussed. meetings per annum held at one of the Asia, and later met informally with Warren Finegold was unable to attend overseas business locations. local management over dinner; one Board meeting due to commitments −− Met with management of the Independence arranged before he joined UBM. two principal venues in Shanghai The Board regularly reviews the (NECC – National Exhibitions David Wei was unable to attend Board, independence of the Non-Executive Conference Centre and SNIEC – Nominations and Remuneration Directors, with primary regard to the

Shanghai New International Expo Financial statements Committee meetings due to commitments personal qualities demonstrated by each Centre) to better understand their arranged before he joined UBM. Director, particularly their judgement, and future plans; the level of engagement and challenge Where Directors were not able to attend that they provide in Board and Committee −− Visited DenTech China (a Major meetings, this was entirely due to prior discussions. The Board considers that all event), with the opportunity to business commitments or ill-health. of the Non-Executive Directors continue meet with employees, exhibitors In each case, they reviewed the papers to remain independent and free from and visitors; and circulated for that meeting and provided any relationship or circumstances that comments directly to the Chairman or −− Had an external expert address could affect, or appear to affect, their Committee Chairman, as appropriate. the Board on the Chinese business independent judgement. environment, future prospects and Setting strategy Non-Executive Directors’ appointments key priorities. Each year there is an annual review of are reviewed every three years. strategy held over two days, where the All Directors’ appointments are subject CEO and the members of the Executive to annual election or re-election Committee present their plans to (as appropriate) by shareholders. the Board. More information about the knowledge, skills and experience of the Board can be 2017 Board strategy meeting found in their biographies and the skills matrix on pages 47 to 49. The Board held a two-day strategy meeting in May 2017 to consider the following topics: −− The Events First strategy current position, market and competitor update, trends and developments; −− Organic growth and target portfolio; −− The future landscape of B2B Events; and −− Three-year planning.

UBM Annual Report and Accounts 2017 55 Leadership continued

Division of responsibilities Being clear on the respective roles and responsibilities of Board members is important in enabling the Board to function effectively. The Board has established clearly defined responsibilities for each of the Chairman, CEO, Senior Independent Director, and the Non-Executive Directors.

Chairman CEO The effective running of the Board. The Chairman spends an Running the Group’s business, within the authority limits delegated average of two days per week carrying out his responsibilities, to him by the Board. but takes no part in the day-to-day running of the business. Leading the Board effectively to ensure that there are sufficient Proposing and developing the Group’s strategy and overall meetings, agenda items are appropriate and there is adequate commercial objectives. time for discussion. Ensuring that Directors are able to contribute fully to Board Recommending an annual budget for Board approval and ensuring discussions and that their skills are utilised to best effect leading its achievement. the Board succession planning process. In conjunction with the Group Company Secretary, Identifying and executing acquisitions and disposals. ensuring compliance with the Board’s approved procedures and maintaining a high standard of corporate governance. Providing a sounding board for the CEO on key business issues. Maintaining dialogue with the Chairman on the important and strategic issues facing the Group. Overseeing the process for evaluating the performance of the Developing and making recommendations to the Remuneration Board, its Committees and individual Directors. Committee on remuneration strategy for Executive Directors and other senior management. Identifying development needs for the Board and Directors and Chairing the Executive Committee. ensuring that Directors update their skills and knowledge to enable them to carry out their responsibilities. Maintaining contact with major shareholders to understand their Leading the communication programme with shareholders and ensuring issues and concerns, ensuring that their views are communicated the timely and accurate disclosure of information to the market. to the Board as a whole. Chairing the Nominations Committee and leading the Board’s succession planning process.

Senior Independent Director Non-Executive Directors Ensuring that the views of each of the Non-Executive Directors Challenging and agreeing the Group’s strategy with senior management are given due consideration and facilitating communication and scrutinising the performance of management in meeting agreed between the Non-Executive Directors and the Chairman. goals and objectives, and monitoring reporting of performance. Holding meetings with the Non-Executive Directors without the Determining appropriate levels of remuneration for Chairman being present to review the Chairman’s performance. Executive Directors. Available to shareholders if they have concerns which contact Meeting with the Senior Independent Director without the Chairman through the normal channels of the Chairman, CEO, CFO or Head being present to review the Chairman’s performance and other matters. of Investor Relations has failed to resolve, or where such contact is thought inappropriate. Meeting with the Chairman without Executive Directors being present.

Conflicts of interest monitors the situation and ensures that all with the terms of appointment and is The Company has established procedures actual and potential conflicts of interest subject to review by the Group Company in place through its Articles of Association are appropriately recorded and authorised Secretary and approval by the Chairman. to manage conflicts. The Articles allow where necessary. No conflicts of interest No such expenditure was incurred in 2017. were disclosed during 2017. for interested Directors to vote provided All Directors have access to the advice they have made sufficient disclosure and Independent professional advice and services of the Group Company have been authorised by the Board to Secretary, who has primary responsibility Each Director has access to independent do so. Directors are permitted to excuse for keeping Directors informed of advice at the Company’s expense, themselves from decisions when they are general developments. to help them discharge their duties. concerned about a conflict or potential Any expenditure is made in accordance conflict. The Group Company Secretary

56 UBM Annual Report and Accounts 2017 Effectiveness

Professional development, The Board believes that diversity should Strategic report support, training and induction not solely consider gender and embraces Conclusions of the diversity in its broadest sense. A wide for Directors 2017 review range of experience, background, Overall the responses were positive. All Directors are offered the opportunity perspective, skills and knowledge is Key themes that emerged included to further their professional development required to contribute towards a high making time to look beyond Events by attending seminars and briefings. performing, effective Board, which is First and discuss longer-term Another resource provided to the better able to support and direct the ambitions; deeper insight into Directors is a ‘Reading Room’, accessible Governance Company. In encouraging this the Board customers and succession planning, through the electronic board portal. supports the recommendations of the and focusing on the culture UBM is The Reading Room contains key Parker review to increase the ethnic aiming for. induction information, including Board diversity of UK FTSE-350 Boards. Committee Terms of Reference and Strengths other documents relevant to the Group’s Board effectiveness review −− The Board had a diverse skill-set; corporate governance structure, including Each year the Board, as required by the −− Committees are well-run with the Matters Reserved for the Board. Code, carries out an evaluation of its highly regarded Chairmen; Financial statements The Reading Room also provides the own effectiveness. Following a thorough Board with access to analyst reports, external evaluation conducted in 2015 −− Meetings were well-managed financial, risk and controls information by Independent Audit Limited, the Board with everyone given a voice; including monthly financial reports, decided to conduct an internal review for −− There was a constructive project and industry updates. 2016 in line with Code. The review took atmosphere that encouraged The induction process includes the form of an online questionnaire, using management to be open; Independent Audit Limited’s “Thinking discussions with the Chairman and − Discussions were open and an Board” tool, and concentrated on specific − Executive Directors as well as individual appropriate level of challenge questions designed to assess what the briefings and presentations from other was maintained; Directors and Executive Committee Board and its Committee do well and to members on matters relating to UBM’s identify areas for development. −− Good progress made on the diversity agenda. business and operational processes The results were presented to the Board, and procedures. The induction includes and discussed in detail in February 2017. Areas for development meetings with other senior management An internally-managed effectiveness −− Understanding better the risks/ as well as UBM’s corporate brokers, review has been completed for 2017, the lessons learned following post- external auditor and other advisers. output of which was discussed at the acquisition reviews; Board meeting in February 2018 and will Diversity −− Deeper insight into customers and be reported on in the 2018 Annual Report. the progress of Agile Growth; We strongly support the principle of improving gender balance both at Board −− Greater clarity on how succession level and throughout our business, and planning and the HR strategy are fully support the recommendations of the progressing; Hampton-Alexander Review into improving −− Board paper format that supports gender balance in FTSE Leadership, quick identification of key issues having achieved the Board level target of and risks. having 30% female Directors by the end of 2015. Currently one third of the Board Actions taken is female (2016: 40%). At the Executive −− Post-acquisition reviews (PARs) Committee this percentage stands at and a programme of detailed 37.5% (2016: 33%) and for the broader Sector Reviews were added to senior leadership team the percentage the rolling forward agenda, stands at 27% (2016: 27%) as detailed with local management presenting on page 25. to the Board; In January 2018 the CEO became a −− A detailed succession-planning signatory to the 30% Club, targeting review was presented to the Board 30% women on FTSE-350 boards by the HR Director; by 2020. −− Improved format for Board papers, with common templates, a clear executive summary, and supporting data separated from the core paper into an appendix.

UBM Annual Report and Accounts 2017 57 Effectiveness continued

Relations with stakeholders The Board understands that effective engagement with the Group’s major stakeholders is a key component of UBM’s long-term success and sustainable value-creation, and pays particular attention to building relationships and trust with major stakeholders. Examples of how this is achieved are set out below.

UBM

Investors Employees Environment Customers Community • Capital Markets Day • CEO informal chats • Industry-leading • Customer • Group-wide sustainability Satisfaction surveys Charity Committee • Results webcasts • Engagement surveys • Sponsorship of the • Establishing • Event-Community • AGM • Recognition awards Industry Report on Advisory Boards partnerships • Roadshows • Results webcasts Best Practices in available to all • Using focus groups • Volunteering • Meetings with Sustainability • Charitable/disaster the Chairman • Championing • Introduction of the relief donations diversity "Sustainable 10" KPIs • Mental health wellbeing

Further details on how we engage with stakeholders can be found in the sustainability report on page 24

Relations with shareholders Institutional shareholders Led by the Chairman, the Board is The Chairman has a programme of Capital Markets Day – committed to proactive and constructive ongoing engagement with shareholders May 2017 engagement with its shareholders. and is available at all times for UBM hosted more than 50 It receives regular feedback on investor any discussion. During 2017, the investors, lenders and analysts at a meetings and other investor relations Chairman had four meetings with Capital Markets Day hosted at our activities, in addition to having access to institutional shareholders. Head Office. Through a series of sell-side research and analyst notes. Financial results are communicated to presentations the Company provided greater insight into the activities in The Board believes that allowing the market twice a year, with trading each of the regions, with examples of shareholders direct access to Non- updates provided in the interim. how we are implementing the Events Executive Directors is necessary to After the preliminary and interim results, First strategy, and driving organic help the Board develop a balanced a presentation is made to shareholders growth and margin improvement. understanding of any issues or and analysts, which is made available to The audience heard from the concerns that may exist in the investor other stakeholders and the public through CEO, CFO and divisional leadership community. The Chairman, Senior a webcast on the Company’s website at on progress and opportunities, Independent Director and other Non- www.ubm.com/investor/results-and- followed by attendees visiting their Executive Directors are available to meet reports. own mini 'UBM' exhibition with major shareholders. different booths showcasing key events such as BlackHat, CBME and Food Ingredients. The webcast of the presentations was shared with employees and the materials made available on the investor section of UBM’s website http://www.ubm.com/investor/ results-and-reports

58 UBM Annual Report and Accounts 2017 There is a scheduled programme of meetings with institutional shareholders which is led by the Head of Investor Relations, and Strategic report generally undertaken by the CEO and CFO. This is an opportunity for the CEO and CFO to discuss performance and respond to any questions raised by investors. The key elements of the Group’s investor engagement programme during 2017 are set out below.

2017 calendar of investor engagement

Date Event February 2017 Preliminary Results (2016) Governance

March 2017 Investor Roadshows – London and Edinburgh Citi Group Media Roundtable event

May 2017 Capital Markets Day – London (hosting more than 50 investors, lenders and analysts)

May 2017 Trading Update and AGM Financial statements June 2017 Bank of America Merrill Lynch Global Telecom and Media Conference

July 2017 Interim Results

August/September 2017 London & Scotland Investor Roadshows Deutsche Bank European Technology Conference

September 2017 Major shareholder visit to Furniture China

October/November 2017 North America & Canadian Investor roadshows – New York, Toronto & Boston Trading Update Morgan Stanley European Technology, Media & Telecom Conference

December 2017 Major shareholder visit to Food Ingredients

Private shareholders Financial and business reporting External auditor Shareholders are kept informed about The Board has procedures in place to Following the Audit Committee’s the activities and progress of the Group satisfy itself that the Annual Report and recommendation to the Board, Ernst through the Annual Report and the Accounts, when taken as a whole, is a fair, & Young LLP were re-appointed as Company’s website. The preliminary balanced and understandable assessment auditor at the last AGM for the 2017 results, interim results, trading updates of the Company’s position and prospects, financial year. and other information about the Company and that the Company continues to be are published on the website. a going concern. The Audit Committee plays a key role in supporting the Board Annual General Meeting (AGM) in making this assessment, and the way All shareholders are welcome at the AGM in which it satisfies itself that all relevant where they are able to ask questions of requirements have been met is set out on the Directors. Voting at the AGM takes page 61. place by poll. The results are notified via a regulatory information service and The Strategic Report sets out a displayed on the Company’s website as description of the Company’s strategy, soon as practicable following the meeting. business model and explanation of All resolutions proposed at the 2017 how it creates value for customers, Annual General Meeting were passed by a shareholders, employees, and other significant majority of shareholders. stakeholders. A statement of the Directors’ responsibility for preparing the Annual Report and Accounts is given in the Directors’ Report. The Operating and Financial Review contains the Directors’ going concern statement. The external auditor’s audit report, which contains its reporting responsibilities, is set out in the financial statements.

UBM Annual Report and Accounts 2017 59 Effectiveness continued

Risk management and −− received a broad-based market and In conducting its review, the Board internal control business risks review of China; ensured that: The Regulatory, Legal & Compliance −− reviewed individual sector reports −− the monitoring and review covered all (RLC) and Internal Audit functions concentrating on the Pharmaceutical material controls, including financial, operate across the organisation and and Fashion industries; operational and compliance controls; have ownership of risk management −− reviewed cyber-security risks and and internal control policies, processes −− there is an on-going process for execution risks for technology and structures. Reviews and audits are identifying, evaluating and managing projects; undertaken based on an assessment the principal risks faced by the of the risk profile of the Company, −− received and reviewed updates to the Company; and its principal subsidiaries and business Anti-Bribery and Corruption and the −− the systems have been in place for divisions, and the results are reported Gifts and Hospitality policies; the year under review and up to to the Executive Committee, the Audit −− received updates on Health, Safety & the date of approval of the Annual Committee and the Board as appropriate. Security; Report and Accounts, and that these systems align with the FRC Guidance The Audit Committee, on behalf of −− carried out a risk review of the UBM on risk management, internal control the Board, reviews the system of risk Asia division; and related financial and business management and internal controls on reporting. an ongoing basis, including Internal −− assessed the effectiveness of the Audit and RLC reports, reports from risk management processes and The Board’s ongoing review has resulted the Group’s external auditor and regular internal controls based on its ongoing in continued expansion in scope of the management reporting. Details of the review of strategy, which aims to Group’s risk management practices. Audit Committee’s work are set out on identify potential risks to the Group’s Details of the enhancements made to the page 61. achievement of objectives. risk management policies and procedures −− It has also reviewed: As part of the year-end reporting during 2017 are set out on page 30 of the processes, and consistent with the • monthly financial reporting against Strategic Report. UK Corporate Governance Code, the budget; The Board has concluded that there Board has carried out a review of • specific material areas of risk across have been no significant failings or the effectiveness of the Group’s risk the Group and mitigation plans (for weaknesses in the risk management and management and internal controls example the Advanstar integration); internal controls systems during the year. for 2017. and Further detail on the assessment process During the year the Board has: • specific acquisitions through a series is provided in the Audit Committee Report of post-acquisition reviews. on page 61. −− approved the risk management disclosure and Long Term Viability Statement in the Strategic Report on page 35; −− reviewed the continuing efforts of the business to implement and enhance procedures to support the Modern Slavery Act; −− carried out a pensions review in May; −− received an updated report on tax liabilities across the Group in July;

60 UBM Annual Report and Accounts 2017 Accountability Audit Committee Report

Dear shareholder Strategic report I am pleased to present the Audit Committee’s report for 2017. The report aims to provide insight into our essential role in protecting the interests of stakeholders through our oversight of financial reporting. It also covers our key activities during the year, and our ongoing responsibilities.

The Committee, which consists of three Governance independent Non-Executive Directors, is a key element of UBM’s governance framework. We have worked throughout the year to fulfil our objective to ensure that the Board can be satisfied that corporate reporting requirements are met, that risk management and internal control principles are applied appropriately, and that the Company maintains an appropriate Financial statements relationship with its external auditor. The Committee met four times during the year, dedicating significant time to, in particular, the control environment and the effectiveness The Audit Committee is an essential of the risk management framework, with one part of UBM’s governance framework, meeting specifically dedicated to risk. In addition, the Committee has continued to monitor overseeing the integrity of financial broader market conditions, including the risks and challenges relevant to the Group and the reporting, risk management and potential impact of these on financial reporting and controls. The Committee has concluded that internal control. During the year the appropriate risk management and internal control processes have been in operation during the year. Committee dedicated significant Further details on the risk review process are set time to, in particular, the control out in the Strategic Report on page 30. During the year the Committee undertook environment and the effectiveness a tender process for the external audit. of the risk management framework. Further details can be found on page 67. Following each meeting I provide an update to the Board on key matters considered and any significant issues and recommendations as appropriate. Periodically throughout the year I Membership meet separately with the CFO, Group Company Secretary, Group Financial Controller, Head of 1, 2 −− John McConnell −− Trynka Shineman Internal Audit and the external audit partner. −− Terry Neill −− Greg Lock (until January 2018) Ahead of Committee meetings I also meet with 1 Chairman of the Committee this group, which is a valuable way for me to 2 Has recent and relevant financial experience better understand key issues and to ensure that sufficient time is allocated during the meeting for Number of meetings discussion and debate. Four The Committee is satisfied that the 2017 Annual Report and Accounts, taken as a whole, are Attendees by invitation fair, balanced and understandable and contain Chairman, CEO, CFO, Group Company Secretary, Group Financial all of the necessary information to allow our Controller, Head of Internal Audit and External Auditor. shareholders to assess UBM’s performance, business model and strategy.

Terms of Reference www.ubm.com/investor/corporate-governance/audit-committee

John McConnell Chairman, Audit Committee UBM Annual Report and Accounts 2017 61 Accountability continued Audit Committee Report

Membership and attendance Purpose The Committee is comprised entirely of The terms of reference set out the independent Non-Executive Directors. The Board is satisfied that, having Committee’s duties to assist the recently held a FTSE 250 CFO position, John McConnell has recent and relevant Board in undertaking its responsibility financial experience. The Committee as a whole has competence in the to monitor the integrity of the sectors in which the Company operates. Biographies of the Committee members financial statements of the Company, are set out on pages 47 to 48, and in the oversee the adequacy of the Group’s skills matrix on page 49. The agendas for the meetings follow a financial controls and systems of risk rolling annual calendar. The CFO, members management and internal control, of the finance team and the Group Company Secretary assist the Chairman and monitor the effectiveness and in preparing the annual agenda and in making sure that the Committee receives independence of both the internal and information and papers on a timely basis. external auditor. The Board delegates An annual review of the performance of the Committee is conducted each year as responsibility to the Audit Committee part of the wider effectiveness review of the Board and its Committees. More detail to help ensure that financial reporting on the process followed during 2017 can be found in the Board Effectiveness processes are robust and overseen Review on page 57. with appropriate independent financial Activities during the year expertise and challenge. Financial reporting The Committee reviews the Company’s financial statements, including the Annual Report and Accounts and half-year results. Key areas of focus in relation to financial reporting during the year included: Key responsibilities −− review of the appropriateness of −− Review of the integrity of the financial statements, the accounting the Group’s accounting policies policies applied, whether significant judgements are sound and and practices, including the monitor compliance with statutory and listing requirements. use of exceptional items and −− Review of the effectiveness of the Group’s financial reporting, application of the exceptional items internal controls and risk management framework. accounting policy; −− Advise the Board whether the Committee believes the Annual −− consideration of material areas in Report and Accounts, taken as a whole, are fair, balanced and which significant judgements have understandable and provides the information necessary for been applied or where there has been shareholders to assess the Company’s performance, business discussion with the external auditor; model and strategy. −− review and continuous improvement −− Review of the scope, resources, results and effectiveness of the of the financial control systems internal audit function and the annual internal audit programme. environment to ensure robustness in reporting; −− Oversee the relationship with the external auditor, the scope of external audit work and the auditor’s effectiveness, ensuring the −− review of the quality of narrative auditor’s independence, monitoring compliance with the policy on reporting, clarity and relevance non-audit fees and considering the findings of the external auditor. of disclosures and adherence to applicable compliance and governance −− Ensure that the audit services contract is put out to tender at best practice; and appropriate intervals, compare the quality and effectiveness of the services provided by the external auditor with those of other audit −− compliance with financial reporting firms, and oversee the selection process. standards and relevant financial and governance reporting requirements. −− Make recommendations to the Board on external auditor remuneration and appointment or re-appointment.

62 UBM Annual Report and Accounts 2017 Other areas of judgement routinely Risk management and −− reviewed in depth the structure of the Strategic report considered and discussed at Committee internal control financial control framework and the meetings include: tax control framework; The Committee monitors and reviews −− recognition and utilisation of the Company’s internal control and risk −− evaluated the scope and findings of provisions, in particular tax and management framework, reporting on its internal audit activities as described on restructuring; and effectiveness. This monitoring includes page 66; −− the amounts charged as exceptional all material controls, including financial, −− considered the external audit plan

items and analysis of the significant operational and compliance controls, (scope and methodology), particularly Governance components of each item. assessing any corrective action where considering whether it is aligned to necessary, and determining that systems areas of financial statement risk and/ The Committee spends time debating are fit for purpose. During the year, or less mature control environments; these areas of judgement with the the Committee: requisite support from management −− reviewed reports from the external and external advisers. Further details on −− reviewed divisional risk maps and auditor on the Group’s financial significant matters considered are set out accompanying deep-dive presentations reporting and internal financial from management in the Americas in the table on page 64. control environment, including any Financial statements and EMEA on the top ten risks and issues identified in the course of their The Committee is satisfied that the associated mitigation activities in each work and observations on controls judgements made by management of those divisions; and control weaknesses and, where are reasonable and that appropriate appropriate, satisfied itself that there disclosures and estimates have been −− challenged the appropriate classification and completeness of was an appropriate response from included in the financial statements. management. In reaching this conclusion, the Committee the top ten risks in each division, and considered reports and analysis prepared recommended the principal risks to the The Audit Committee concluded that by management. The Committee also Board for approval, as disclosed in the the Company’s internal control and risk considered detailed reporting from, and Strategic Report on pages 1 to 45; management framework was appropriate had discussions with, the external auditor. −− reviewed and considered the updated and that there have been no significant risk modelling and aggregation work control issues or failings during the year. Fair, balanced and carried out to support an enhanced External audit tender understandable assessment Long Term Viability Statement on page The Committee conducted a tender The Committee has considered whether 35. This work was then recommended process for the 31 December 2018 year- the 2017 Annual Report and Accounts to the Board; end audit (see page 67 for full details). are fair, balanced and capable of −− reviewed and constructively challenged being understood by shareholders. management in its presentation of the In order to make this assessment, results of a project to assess potential the Committee has: venue contract risk and plans to −− maintained oversight of the 2017 reduce and mitigate this; Annual Report and Accounts process; −− reviewed the current risk policy and −− been provided with regular updates, the structure and plans for the Group’s and received assurance of continuing enhanced risk management processes, verification to ensure consistency, noting that the internal audit plan for impartiality and balance throughout; 2018 is aligned to areas of highlighted risk, with each planned audit −− reviewed and challenged documenting a link back to a specific Management’s assessment of items Group Principal Risk; included in the financial statements and prominence given to those items, −− Reviewed the implementation of with particular attention paid to Business Continuity Planning across the use of Alternative Performance the business and approved a new Measures; and Business Continuity Planning policy and implementation plan to improve −− considered the matters discussed at business resilience globally; Board and Committee meetings during the year and ensured that these are −− reviewed the status of the control addressed appropriately in the 2017 frameworks relating to UBM’s Principal Annual Report and Accounts. Risks, including the integrated risk management, governance, control framework and assurance process across the Group;

UBM Annual Report and Accounts 2017 63 Accountability continued Audit Committee Report

In accordance with the Corporate Governance Code, significant matters that the Committee has considered in relation to the financial statements are set out below:

Matter considered How the matter was addressed Acquisition accounting The Committee reviewed management reports on the final Certain transactions require management to make judgements as acquisition accounting for Allworld, and the preliminary acquisition to the identification and valuation of intangible assets, with small accounting for AEM (Bahrain business of Allworld), Marmara, AMA changes in assumptions making a significant difference to the Research, Green Thinking Services and The Aesthetic Show. The value of assets recorded. Committee also considered the reports from the external auditor as to the appropriateness and consistency of management’s valuation approach and judgements.

Goodwill impairment The Committee reviewed management’s report on the annual Goodwill is an area of focus for the Committee given the impairment review of the carrying value of goodwill. In particular, materiality of the Group’s goodwill balances. The judgements in the Committee challenged certain assumptions applied in the relation to goodwill largely relate to the assumptions applied in impairment review including terminal growth rates and the relevant calculating the value in use of the Cash Generating Units (CGUs). discount rates. The Committee considered the combination of the Print and Online CGUs and the inclusion of Allworld Events CGU. The Committee also considered reports from the external auditor on their findings.

Taxation The Committee reviewed management reports setting out the There are significant deferred tax assets and liabilities held on policy and approach to measuring and recognising deferred tax the UBM balance sheet and also unrecognised deferred tax assets and liabilities. The Committee considered the impact of the assets in respect of losses. Management must make judgements PRN disposal on the recognition of US tax losses and agreed that based on forecasts to determine the appropriate basis for the judgements regarding the recognition of Luxembourg losses recognition of deferred tax assets and liabilities which impact the remained appropriate. The Committee also considered reports from effective tax rate. the external auditor as to the appropriateness of management’s methodology, judgements and consistency of application.

64 UBM Annual Report and Accounts 2017 Strategic report Activities during the year: Audit Committee calendar

Meeting Key items considered February 2017 2016 results and financial statements Internal Auditor Report −− Year-end accounting matters and judgements −− Governance and Control update −− Going concern review −− Internal Auditor Report −− Tax provisions Long Term Viability Statement Governance −− Draft Annual Report and Accounts −− Review of severe but plausible scenarios −− Consideration of fair, balanced and −− Modelling outcomes of the selected scenarios understandable statement External Audit −− Accounting for the Allworld acquisition and PRN −− Audit tender planning update disposal −− 2016 audit results report Risk −− Approval of non-audit fees −− Global Business Services (the financial shared services function) Risk Review Financial statements

July 2017 2017 interim financial statements Risk −− Accounting matters and judgements −− Half-year risk update −− Going concern review −− Americas Risk Review – Deep Dive −− Allworld accounting −− Allworld financial integration −− Exceptional items accounting policy −− Business Continuity Planning update Internal Audit −− Lessons learned from third party cases of fraud −− Governance and Control update and bribery −− Internal Auditor Report External Audit −− Interim Review Report −− Approval of non-audit fees −− Audit tender update

October 2017 Risk External Audit (Risk-Focused Meeting) −− EMEA Risk Review – Deep Dive −− 2017 Audit Plan and Audit Fee −− Allworld financial integration −− External audit transition planning −− Risk-modelling update −− Business Continuity Planning −− LTVS – including determination of severe but plausible scenarios for 2017 reporting

December 2017 2017 Financial Reporting Update Internal Audit −− Annual Report and Accounts process and −− 2018 Internal Audit Plan planning −− Internal Audit report −− Year-end accounting matters and judgements, −− Governance and internal control framework including: External Audit • goodwill impairment −− Audit Update Report • disposal accounting −− Approval of non-audit fees • exceptional items −− External audit transition planning Risk −− Risk-modelling update −− Full-Year Risk Review −− Draft Annual Report draft disclosures, including updated LTVS

UBM Annual Report and Accounts 2017 65 Accountability continued Audit Committee Report

Fraud and whistleblowing External audit The Committee monitored the conduct The anti-malpractice policy, which The Committee has considered the and effectiveness of the external forms part of the Group’s Code of Company’s compliance with the UK auditor during the year, considering its Business Conduct, provides employees Competition and Markets Authority’s independence and objectivity, through its with an independent and confidential Statutory Audit Services Order and The own observations and interactions with whistleblowing service to raise concerns Statutory Auditors and Third Country the external auditor, and with regard to about any form of malpractice (fraud, Auditors Regulations 2016. the following: corruption, dishonesty or other It is UK tax resident and has designated −− experience and expertise of the irregularities) where they do not feel the UK as its Home Member State auditor partner and their staff comfortable raising the matter with local for the purpose of the Disclosure and −− communication with, and support to, management or are not satisfied with the Transparency Rules. Although UBM is the Committee; local management response. This service therefore not a Public Interest Entity, is provided by Safecall, an independent −− content, quality of insights and added the Company complies with the spirit of third party provider. A summary of value of their reports; legislation applicable to UK incorporated incidents, whether arising through the companies, including the Companies Act −− fulfilment of the agreed external audit management line or via the whistle- 2006 and related Statutory Instruments plan; blowing service, underlying investigations and as a Public Interest Entity for and actions undertaken is provided to the −− robustness and perceptiveness of the purposes of the FRC’s Revised Ethical Committee for review on a regular basis. external auditor in their handling of Standards 2016. key accounting and audit judgements; Internal audit External auditor independence −− the interaction between management The Head of Internal Audit reports to and the external auditor; Ernst & Young LLP ("EY") has been UBM’s each Committee meeting. During the year, external auditor since 2002 and was −− provision of non-audit services as set the Committee has: reappointed following a tender process out in this Report; and −− reviewed and evaluated Internal in 2009. The Chairman of the Committee −− discussions relating to the Audit reports covering the financial, meets with the external auditor on a performance of the external auditor compliance, operational and IT reviews regular basis to ensure open dialogue with UBM management. undertaken during the year, including and feedback, and facilitate effective reports on cybersecurity and reviews and timely communication between the The external auditor is required to rotate of the controls operated by major external auditor and the Committee. the audit partner responsible for the external service providers; Group audit every five years. The lead An annual review is carried out of the audit partner had been in place for five −− considered the common control external auditor’s independence and audit years and, as a result, following the themes identified across the Group process effectiveness. In assessing its conclusion of the audit on the 2016 and plans being put in place to independence, the Committee received Annual Report and Accounts, a new continuously monitor and assess these; written confirmation that, in EY’s lead audit partner took over for the −− reviewed the implementation of all professional judgement, the external 2017 audit. internal audit recommendations auditor is independent within the meaning The Committee recommended to the against the target dates for resolution of all UK regulatory and professional Board that EY be proposed for re- and required explanations for requirements and that the objectivity of appointment at the AGM in May 2018. significant issues in cases where the audit engagement partner and audit timescales were not met; staff is not impaired. During the year the −− considered any fraudulent activity Audit quality is assessed throughout the Committee has and/or identified control issues to year by reference to the quality of the −− approved the terms of engagement assess whether they demonstrated a reports received by the Committee, the and fees to be paid to EY for the audit significant failing, or weaknesses in calibre of senior members of the audit of the 2017 financial statements; and internal controls; team and the level of challenge provided to management. −− reviewed and agreed the scope of the −− continuously monitored the work undertaken by EY. effectiveness of the internal audit During the year an Audit Quality Review activities and evaluated this as part Team (AQRT) from the FRC undertook of a review of the scope of the 2018 an inspection of EY’s audit of the Group’s Internal Audit Plan; 2016 financial statements. The AQRT’s −− reviewed the adequacy of UBM’s final report was issued at the end of 2017. internal audit resourcing in the light A copy of the report was sent to the Audit of changes to the Group’s risk profile, Committee Chairman and the results such as significant acquisitions; and were presented to the February 2018 Committee meeting. The Audit Committee −− reviewed, considered and concluded was pleased with the overall assessment. upon an assessment of the effectiveness of Internal Audit.

66 UBM Annual Report and Accounts 2017 Strategic report Audit tender The Committee decided that an audit tender process for the 31 December 2018 year-end audit would be undertaken during 2017. Tender participants PricewaterhouseCoopers LLP, KPMG LLP and Ernst & Young LLP (the incumbent) were invited to participate in the process.

Tender process Governance A rigorous 12-week structured process was organised, focused on the selection criteria, including: −− A detailed written proposal document; −− Meetings with divisional finance teams in Americas, EMEA and Asia; Group Finance; Internal Audit; Global Operations; Tax; Treasury; Group Company Secretarial and IT; −− Oral presentations to, and a question and answer session with, the Selection Panel, which comprised the Audit

Committee Chairman, CFO, Head of Internal Audit and Group Financial Controller, with the Group Company Secretary Financial statements acting as an observer. Selection criteria The Selection Panel reviewed the tender submissions and presentations and scored them independently based upon cultural fit, an effective and innovative audit approach, technical issue resolution, use of data analytics, relevant insight – including feedback to support the improvement of UBM’s control and process environment – and fees, as well as the overall strength and relevant experience of the proposed team. Decision The Selection Panel recommended the appointment of KPMG as external auditor, based on the overall strength and depth of their team, cultural fit, insight, and audit approach. The Board ratified the decision of the Selection Panel and announced the decision to the London Stock Exchange in July 2017. In light of the offer by Informa, in February 2018 the Company decided to postpone the appointment of KPMG until the 2019 financial year. EY will therefore continue as external auditors for the 2018 financial year, and will be proposed for re-appointment at the AGM in May 2018.

Non-audit services −− To help ensure the objectivity and Non-audit services policy independence of the external auditor, The objective of the non-audit services policy is to ensure that the provision of a formal policy is in place to manage such services does not impair the external auditor’s independence or objectivity. non-audit services. This policy is All services provided by the external auditor (other than the audit itself) are reviewed annually by the Committee regarded as non-audit services. and all non-audit services are The non-audit services policy prescribes that any non-audit assignment by the reported at each meeting. Non-audit Company’s external auditor is pre-approved by the Audit Committee, unless the services carried out by EY in the proposed service is both expected to cost less than £20,000, (up to a cumulative year comprised tax compliance, due limit of £85,000) and falls within a service category already approved by the diligence and advisory work. Audit Committee. All non-audit services are reported to the Committee at its −− The Committee was satisfied that next meeting. the objectivity and independence of All fees paid to the external auditor for non-audit services are continuously EY was not in any way impaired by monitored, to ensure that Group non-audit services fees do not exceed 70% the nature of the non-audit services of the average of the Group statutory audit fee over a rolling three year period. undertaken during the year, by the The first measurable period will be from 1 January 2017 to 31 December 2019. level of non-audit fees charged, or by any other factors or circumstances. Tax services were prohibited in all EU countries from 1 January 2017. This was Audit fees payable to EY during the extended to all other UBM locations on 1 January 2018. year were £1.8m (2016: £1.7m), and non-audit fees were £0.2m (2016: £0.3m). An analysis of the fees is provided in Note 3.3 to the financial statements.

UBM Annual Report and Accounts 2017 67 Directors’ Remuneration Report Section 1 – Annual statement from the Chairman, Remuneration Committee

Dear Shareholder As Chairman of the Remuneration Committee, and on behalf of the Board, I am pleased to present the Directors’ Remuneration Report for the financial year 2017. Under the guidance of Tim Cobbold as our CEO, we have further progressed on our Events First journey which has continued to deliver accelerated organic revenue growth, an ever improving Group operating margin and a global operating platform to support improved profitable growth. The integration of Allworld Exhibitions continues as planned and ahead of business case. Our sales and marketing excellence programmes have extended their reach and impact globally and our support functions continued their drive for operational efficiency. Overall we saw strong cash generation, growth in earnings per share and an overall strengthening of the 2017 has been another strong year balance sheet. The delivery of our strategy has an important bearing on the work of the for UBM and its shareholders as Remuneration Committee. we continue to deliver against our The Committee met six times in 2017 to ensure the Remuneration Policy was Events First strategy. We have seen implemented appropriately and to consider the measurement of the Annual Bonus an increase in the adjusted underlying Plan for 2017 and Long-term Incentive Plan awards made in 2015 (where the Committee organic growth in our Events business applied the same judgement on vesting as from 3.1% to 5.3% during the year as previously agreed for the 2014 awards). Following the announcement on 30 January well as increasing the Group’s adjusted 2018 of my appointment as Non-Executive Chairman, Warren Finegold was appointed as operating margin from 27.2% to Chairman of the Remuneration Committee 29.3%. The incentive payments made with effect from 30 January 2018. to our Executive Directors reflect this performance. I would like to thank the shareholders for their approval and endorsement of the Directors’ Greg Lock Chairman, Remuneration Remuneration Policy at the 2017 AGM. Committee (during 2017)

Contents Key items considered Section 1 This Annual Statement Page 68 Section 2 Remuneration Policy The Remuneration Policy which was approved at the AGM on Page 70 17 May 2017 Section 3 Annual Remuneration Report How UBM’s Remuneration Policy was implemented during the Page 77 year ended 31 December 2017, and how we intend the Policy to apply for the year ending 31 December 2018 Chairman, Remuneration Greg Lock (to 30 January 2018) Committee Warren Finegold (from 30 January 2018) Other Committee members Mary McDowell, David Wei Terms of Reference www.ubm.com/investor/corporate-governance

68 UBM Annual Report and Accounts 2017 2017 Performance: decisions assessed on a reported basis, based on Implementing the Remuneration Strategic report and reward outcomes EPS, ROACE and TSR performance over the Policy for 2018 three years to 31 December 2017. Awards are The Committee intends to operate the For 2017, the Company delivered reported held by the CEO (granted March 2015) and revenue growth of 16.2% and the adjusted Remuneration Policy for Executive the CFO (granted upon appointment in Directors for 2018 as follows: operating margin increased 2.1% to September 2015). Average EPS for 2016 and 29.3%. Continuing diluted adjusted EPS 2017 represented 14.2% growth per annum −− Executive Director base salaries have grew by 34.5% on a reported basis. over the average EPS for 2013 and 2014 been increased by 3% from 1 February These Group results have been positively which was above the maximum target of 9% 2018 in line with increases applied Governance impacted by favourable foreign exchange per annum growth. ROACE performance for throughout the Group; movements in the year. Against this financial PSP purposes was 13.7% which was ahead −− No changes will be made to pension performance the Committee considered the of the performance required for maximum provision; following assessments: vesting of 13.1%. TSR outperformed −− Annual bonus will continue to be set at Annual bonus the median of the FTSE 250 (excluding 150% of salary for the CEO and 120% The 2017 annual bonus was assessed on investment trusts) by 11.9% per annum of salary for the CFO and targets will which was ahead of the maximum target measure EPS, Group adjusted operating a constant currency basis against total Financial statements adjusted EPS, Group adjusted operating of 10% per annum of outperformance. profit margin (before strategic operating profit margin (before strategic operating Following the Committee’s assessment of expenditure), Total Group Events expenditure), revenue of the ‘Major’ Events the performance conditions, 100% of the Revenue and personal objectives. For and personal objectives. EPS was 53.4p awards will vest on the third anniversary of 2018 the Committee determined it was which was close to maximum performance. the grant date in March 2018 for the CEO appropriate to change the revenue Group adjusted operating profit margin and September 2018 for the CFO. performance measure for the annual (before strategic operating expenditure) Further details are set out on page 80. bonus plan from £1m+ events Revenue was 30.0% which was above maximum to Total Group Events Revenue. This performance. Revenue of £1m+ business Remuneration Policy reflects the conclusion of the three year events was £766.0m which was just below Following shareholder approval of its rationalisation programme and the focus target performance. Directors’ Remuneration Policy at the May in 2018 on growth across the portfolio. 2017 AGM UBM has implemented the Policy The Committee believes this measure is The overall pay-out against the financial as follows: elements was 59.2% out of a maximum of well balanced with other measures in the 75%. The Committee assessed personal −− EPS, ROACE, Relative TSR and Total bonus plan which focus management performance against the objectives set and Group Revenue will be the four measures on continued profitability and margin judged that for the CEO 96.5% of maximum used in the PSP. Each measure will be efficiency as well as driving our strategic personal objectives were met, and that for weighted equally with the aim of driving goals through personal objectives set. the CFO 95% of the maximum personal our Events First strategy (three of the Bonus deferral, at 25% of any bonus, will objectives were met. This resulted in bonus four measures are Group KPIs as set out continue to operate; payments of 83.3% of maximum bonus for on page 23); −− Recognising the offer from Informa there the CEO and 82.9% of maximum for the −− When assessing the level of vesting are no planned 2018 PSP awards. This CFO. The Committee considers that these under the PSP, the Committee will decision will be revisited should UBM bonus payouts are an appropriate reflection consider the underlying financial continue as an independent business; and of the performance delivered for 2017. performance of the Company and −− Revenue targets are considered Consistent with the Remuneration Policy, the value generated for shareholders commercially sensitive but will be disclosed 75% of the bonus will be paid in cash and and may adjust the level of vesting if in full at the end of the performance 25% will be deferred into UBM shares for it considers that the outcome based period. EPS targets remain unchanged three years under the Deferred Bonus Plan on the assessment of performance following last year's decision to increase (DBP). Full details of the targets set and against targets does not reflect this. In them to 6% p.a. for threshold vesting performance against these targets are particular, when assessing performance and to 10% p.a. for maximum vesting. shown on page 78. for the revenue portion of the award ROACE and TSR targets will also remain the Committee will consider the quality unchanged. Long-term incentive plan of revenue growth delivered, adjusted For the 2015 PSP the Committee applied for acquisitions and disposals, including Looking forward the same adjustments in respect of margin achieved and the impact on At our AGM in 2017, our Annual the assessment of performance of the profitability, and ensure any revenue Remuneration Report received the Performance Share Plan (PSP) related to growth rewarded via the PSP represents support of 94.96% of shareholders the EPS and ROACE measures for the 2014 value improvement for shareholders; voting. We do not take your continued PSP. Last year we extensively consulted with −− Shareholding guidelines for Executive support for granted and hope that you will shareholders regarding these adjustments Directors will be 200% of salary for the support our recommendations on bonus and were pleased with the level of support CEO and 150% of salary for the CFO as as well as PSP awards. I will be available at received. Following this the Committee decided set out in the Policy on page 73; and the AGM to answer any questions about that no further adjustments were required in the work of the Committee. − A two year post vesting holding period relation to these measures for the 2015 PSP − was introduced to PSP awards granted to in respect of the Allworld acquisition. Executive Directors from 2017 onwards. Performance Share Plan (PSP) awards granted in 2015 and vesting in 2018 were There are no changes proposed to the Policy this year. UBM Annual Report and Accounts 2017 69 Directors’ Remuneration Report continued Section 2 – The Directors’ Remuneration Policy report

Introduction Sections 1, 2 and 3 of this Remuneration Our reward philosophy: Report for the year ended 31 December 2017 comply with UK governance To provide remuneration that attracts, motivates and retains executives with requirements including The Large and the appropriate skills and talent to deliver UBM’s strategy and create long-term Medium-sized Companies and Groups shareholder value. (Accounts and Reports) (Amendment) Regulations 2013, the rules of the UK Listing Authority, and the provisions of Our reward principles: the 2016 UK Corporate Governance Code. Alignment with UBM’s strategy Our short and long-term incentives are aligned to the key financial metrics Policy scope and strategic objectives in our Events First strategy. This helps ensure that The Policy applies to the Chairman, our Remuneration Policy incentivises and rewards Executive Directors and Executive Directors and Non- management to achieve UBM’s strategy. Executive Directors. The annual bonus will typically be subject to profit and revenue targets, Policy duration to encourage profitable growth. The financial underpin that applies to the annual bonus plan, and the malus and clawback provisions under the bonus The Directors’ Remuneration Policy, and long-term incentives, ensure that reward is only provided for robust and following the 2017 AGM approval, is sustainable performance. intended to remain in place for three years until May 2020. The Policy is Long-term incentives in the form of the Performance Share Plan awards will be replicated here for ease of reference. subject to Total Group Revenue, EPS, ROACE, and relative TSR. This provides a No changes have been made from strong focus on our strategic plan and incentivises value enhancing revenue and the version approved by shareholders earnings growth, maintains strong returns, as well as incentivising the creation of at the 2017 AGM, other than to the continuous value for shareholders. scenario charts where salaries have been updated to reflect those in place Alignment with shareholders from 1 February 2018. A significant proportion of executives’ remuneration is performance-based. The balance of the remuneration package at maximum performance is weighted towards the long-term and delivered in UBM shares to ensure that the interests of management are aligned with those of shareholders. Alignment with the wider Group The reward principles that govern Executive Directors’ remuneration are aligned with the broader reward philosophy and principles of the Group. When determining remuneration for the Executive Directors, the Committee gives consideration to pay and conditions in the wider employee population.

70 UBM Annual Report and Accounts 2017 Remuneration Policy table – Executive Directors Strategic report The table below sets out the Remuneration Policy for Executive Directors. Details of how the Committee intends to operate this Policy in 2018 can be found on page 85.

Elements Purpose and link to strategy Operation Maximum opportunity Performance measures Base salary Supports the To align with changes for other While the Committee has None, although performance recruitment and employees the normal effective not set a maximum level of the individual is taken into

retention of Executive date for any increase will be of salary, increases will account by the Committee Governance Directors of the calibre moved to March from 2019. be determined taking into when setting and reviewing base required to deliver For 2017 and 2018, increases account salary increases salary levels UBM’s strategy will be effective 1 January 2017 amongst the wider and 1 February 2018 respectively workforce When considering salaries, However, the Committee the Committee takes a range retains the discretion of factors into consideration, to make increases

including: above this level in Financial statements −− The skills, experience, certain circumstances, responsibilities and for example, but not performance of the individual limited to: −− Pay at companies of a similar −− An increase in the size and complexity to UBM individual’s scope and responsibilities −− Corporate performance −− Alignment to the −− Pay increases for our internal external market employee comparator group −− An increase to reflect an individual’s performance and development in the role, e.g. where a new appointee is recruited at a lower salary level and is awarded stepped increases Retirement Provides a market- Defined contribution plan or Annual contributions No performance measures benefits competitive retirement cash allowance in lieu of pension by the Company will not benefits package, in contribution exceed 20% of base line with local market All of UBM’s defined benefit salary practice schemes are closed to new Level of contribution/ employees allowance dependent on local market and seniority of the individual Benefits Provides a competitive Executive Directors receive There is no maximum. No performance measures benefits package in private healthcare insurance (for Benefits are set at a level line with local market the executive and their family), which the Committee practice income protection cover and life considers appropriate assurance benefits of four times in the context of the base salary circumstances of the role/ Executive Directors are entitled to individual and local market participate in all-employee plans practice operated by the Company, such as Sharesave Other benefits may be provided if considered reasonable and appropriate by the Committee, including, but not limited to, housing allowance and relocation allowance

UBM Annual Report and Accounts 2017 71 Directors’ Remuneration Report continued Section 2 – The Directors’ Remuneration Policy report

Elements Purpose and link to strategy Operation Maximum opportunity Performance measures Annual Rewards the Measures and targets are set Maximum opportunity: Typically, performance over the Bonus achievement of key annually in the context of UBM’s −− CEO: 150% of base relevant financial year is assessed annual Group financial strategy salary against the following measures: targets and the delivery The Committee determines bonus −− CFO: 120% of base Financial measures of quantifiable personal pay-outs after the financial salary −− A profit-based measure and strategic business year-end, based on performance The bonus starts −− A revenue-based measure objectives against annual targets paying out from 95% Compulsory deferral Non-financial measures The annual bonus is normally threshold performance. of part of the bonus −− Personal objectives which may delivered 75% in cash (after the Pay-outs are normally into shares under the include strategic KPIs, to be audited results for that year are on a straight-line basis Deferred Bonus Plan agreed on an annual basis approved), and 25% in deferred between threshold and (DBP), providing a link shares after three years maximum The Committee may alter the to creating sustainable Payment of any bonus is at the measures, weightings and targets long-term value and discretion of the Committee and including introducing different acting as a retention subject to the financial underpin measures annually if it determines tool whereby no bonus will be paid that it is appropriate to do so The financial underpin unless at least 50% of budget The balance of the measures that applies to the operating profit is achieved for any year will be weighted annual bonus plan Unvested DBP awards are subject towards financial, with a minimum and the malus and to a malus provision which could weighting of 75% clawback provisions reduce or cancel the award prior under the deferred Details of the measures that to vesting. Clawback also applies bonus (see ‘Operation’ will apply for the 2018 financial to the cash payment and the opposite), seeks to year are set out in the Directors' deferred shares for five years ensure that poor Remuneration Report on page 77 from payment (cash)/ award corporate performance (deferred shares) is recognised and not rewarded Examples of where malus/ clawback would apply are a material misstatement of results, material failure of risk management, or serious reputational damage Awards that vest under the DBP will accrue dividend equivalents up to the point of vesting Performance Incentivises and Awards are made annually with The maximum Awards will be assessed against Share Plan rewards the delivery vesting dependent upon the opportunity range for up to four performance metrics (PSP) of UBM’s strategy achievement of performance PSP awards will usually including: (there are Delivered in shares conditions over three years be capped at 200% of −− Total Group Revenue salary. Award levels will no planned to align executives Unvested awards will be subject −− EPS 2018 PSP with shareholders to a malus provision prior to be determined annually −− ROACE awards as and helps executives vesting. Clawback also applies The Plan rules allow described on to build a significant for five years from award for awards to be −− Relative TSR performance against a comparator group page 69) shareholding in UBM Examples of where malus/ made up to 250% of or index Assists in the clawback would apply are salary in exceptional retention of a material misstatement of circumstances (such Straight-line vesting normally executives results, material failure of as recruitment of a applies between these levels of risk management, or serious new Director) performance reputational damage Awards vest as follows: Any future awards will measure Awards that vest will accrue −− Threshold the Total Group Revenue, EPS, dividend equivalents up to the performance: up to ROACE and relative TSR with point of vesting 25% of award each measure weighted equally For awards granted in 2017 −− Maximum For future awards the Committee onwards, a two year holding performance: 100% may alter the measures, period will apply following the of the award weighting and targets including end of the performance period introducing different measures annually if it determines that it is appropriate to do so Details of the targets that will apply for any future awards are set out in the Directors' Remuneration Report on page 85

72 UBM Annual Report and Accounts 2017 Strategic report Elements Purpose and link to strategy Operation Maximum opportunity Performance measures Shareholding Aligns executives with Executives are generally CEO: 200% of salary N/A guidelines shareholders expected to achieve the CFO: 150% of salary guideline five years after appointment Executives are encouraged to grow their shareholding

by holding shares which have Governance been delivered through the Deferred Bonus Plan and the Performance Share Plan

Remuneration Policy table – Non-Executive Directors Financial statements

Elements Purpose and link to strategy Operation Maximum opportunity Chairman Provide an appropriate Fees are reviewed annually There is no defined maximum opportunity. and Non- reward to attract and The fee structure is as follows: Fees are set at a level which: Executive retain high calibre −− The Chairman is paid a single, consolidated fee −− Reflects the commitment and contribution Director fees individuals that is expected from the Chairman and −− The Non-Executive Directors are paid a basic Non-Executive Directors fee, plus additional fees for chairmanship of Board Committees and for the Senior −− Is appropriately positioned against Independent Director comparable roles in companies of a similar size and complexity Fees may be paid in cash and/or UBM shares. Non-Executive Directors do not participate in Actual fee levels are disclosed in the any incentive scheme. Additional fees may be Annual Remuneration Report for the relevant paid to reflect increased responsibilities on an financial year interim or permanent basis The Company reimburses the Chairman and Non-Executive Directors for reasonable expenses in performing their duties and may settle any tax incurred in relation to these. The Board may introduce additional benefits for the Chairman/Non-Executive Directors if it is considered appropriate to do so

Committee discretion For these purposes ‘payments’ includes and/or divestment of a Group business) The Committee reserves the right to the Committee satisfying awards of which cause the Committee to consider make any remuneration payments and/ variable remuneration and, in relation to that an amended or substituted or payments for loss of office (including an award over shares, the terms of the performance condition would be more exercising any discretions available to payment are determined at the time the appropriate. Any amended or substituted it in connection with such payments) award is granted. target would not be materially less difficult to satisfy. Any use of the above notwithstanding that they do not accord Awards under the Deferred Bonus Plan discretions would be explained in the with the Policy set out above if the and the Performance Share Plan may Directors’ Remuneration Report and may terms of the payment were agreed (i) be granted as conditional share awards be the subject of consultation with the before 20 May 2014 (the date when the or nil cost options or in such other form Company’s major shareholders. Company’s first shareholder-approved the Committee determines has the same Directors’ Remuneration Policy came economic effect. Awards may be settled into effect); (ii) before the Policy set out in cash at the Committee’s discretion. above came into effect, provided that the Awards may be adjusted in the event of terms of the payment were consistent any variation of the Company’s share with the shareholder-approved Directors’ capital or any demerger, delisting, special Remuneration Policy in force at the time dividends or other event that may affect they were agreed; or (iii) they relate to the Company’s share price. a time when the relevant individual was not a Director of the Company, and, in the The Committee retains the ability to opinion of the Committee, the payment adjust bonus and/or PSP targets and/ was not consideration for the individual or set different measures if one or more becoming a Director of the Company. events occur (e.g. material acquisition

UBM Annual Report and Accounts 2017 73 Directors’ Remuneration Report continued Section 2 – The Directors’ Remuneration Policy Report

Illustration of Executive Remuneration Policy The charts below illustrate below target, on-target and maximum remuneration levels for the CEO and CFO for 2018. These charts have been updated from the versions included in the shareholder-approved Policy to reflect salaries in place from 1 February 2018 and benefits for 2017. The three scenarios are based on the assumptions described below:

CEO (Tim Cobbold) CFO (Marina Wyatt)

Maximum Maximum performance 28% 34% 38% £3.1m performance 31% 31% 38% £1.9m

On-target On-target performance 51% 31% 18% £1.7m performance 56% 27% 17% £1.0m

Below target Below target 100% £0.9m 100% £0.6m performance performance

0 £0.5m £1m £1.5m £2m £2.5m £3m £3.5m 0 £0.5m £1m £1.5m £2m £2.5m £3m £3.5m

Fixed Annual bonus Long-term Fixed Annual bonus Long-term (incl. deferred bonus) incentives (PSP) (incl. deferred bonus) incentives (PSP)

Fixed pay (below target performance) −− Base salary with effect from 1 February 2018, benefits (based on the 2017 single figure) and pension (“Fixed pay”) −− No bonus pay-out −− No vesting under the PSP On-target performance −− Fixed pay −− 50% of maximum bonus opportunity (75% of salary for the CEO, 60% of salary for the CFO) −− 25% of PSP shares vest at threshold performance (42.5% of salary for the CEO, 37.5% of salary for the CFO)

Maximum performance −− Fixed pay −− 100% of bonus pays out (150% of salary for the CEO, 120% of salary for the CFO) −− 100% of PSP shares vest (170% of base salary for the CEO, 150% of salary for the CFO)

Note: As per the disclosure requirements, share price appreciation and dividends have been excluded from the scenarios.

Shareholder views and −− Communication with shareholders −− Consideration of pay and conditions consideration of employment The Committee maintains an open for the wider Group dialogue with UBM shareholders While the Committee does not consult conditions elsewhere in the Group and seeks their views when any with employees regarding Executive The Remuneration Policy for Executive significant changes are being made to Directors’ remuneration the Committee Directors reflects the reward philosophy remuneration arrangements. does consider pay and employment and principles that underpin remuneration conditions elsewhere in the Group when for the Group. The Remuneration determining executive pay, to ensure Policy for employees across UBM’s that pay structures are appropriately global workplace will differ from the aligned. The Committee also considers Policy for Executive Directors to reflect base pay movements of the wider different levels of seniority and local employee population when determining market practice. base salaries for Executive Directors.

74 UBM Annual Report and Accounts 2017 Recruitment remuneration Buyouts Terms and conditions for Strategic report arrangements The remuneration package offered to Non-Executive Directors The Committee will take into consideration new Executive Directors may include a Non-Executive Directors are appointed by any relevant factors when determining buyout of remuneration forfeited by the the Board on the recommendation of the the remuneration arrangements for a Executive Director on leaving their former Nominations Committee. The appointment new Executive Director. Factors may employment if the Committee considers of Non-Executive Directors is for a fixed include the calibre and experience of that this is necessary. term of three years, during which period the individual; local market practice When determining any buyout the the appointment may be terminated Governance in the individual’s current location; Committee will take account of relevant by the Company or the Non-Executive the individual’s existing remuneration factors including performance conditions Director giving three months’ notice arrangements; the remuneration attached to awards, the form in which (six months notice for the Chairman). arrangements for other executives; and they were granted (for example cash or There are no provisions on payment business circumstances. We seek to equity awards) and the vesting timeframe for early termination in their letters ensure that arrangements are in the best of awards. Buyout awards will generally of appointment. interests of both the Company and its be structured on a comparable (“like for Each Non-Executive Director’s shareholders, and seek not to pay more Financial statements like”) basis to the awards forfeited. appointment (including that of the than is necessary. The Committee may rely on exemption Chairman) is reviewed every three years. When recruiting an Executive Director, 9.4.2 of the Listing Rules which allows In accordance with the UK Corporate the Committee will normally seek to for the grant of awards to enable, Governance Code, all Directors are align the remuneration package offered in exceptional circumstances, the required to stand annually for re-election. with the Remuneration Policy. However, recruitment of a Director. Awards made The letters of appointment of Non- the Committee retains the discretion to using this exception would apply to Executive Directors and service contracts make appropriate remuneration decisions buyouts only and would be structured of Executive Directors are available for outside the structure of the standard to follow similar principles as awards inspection at UBM’s registered office Policy to meet individual circumstances under the Performance Share Plan. during normal business hours and will be subject to the maximum level of variable The Committee would take a holistic available at the AGM. pay outlined below. view of remuneration in making any such The Committee has the discretion to decision to ensure it is not paying more Loss of office payments change the performance measures and/ than is necessary. Salary/fees and benefits or targets used under the annual bonus Executive Director service Executive Directors’ service contracts and/or long-term incentive plan if it contain provisions for payment in lieu determines that the circumstances of the contracts of notice in respect of base salary. recruitment merit such alteration. The current Executive Directors The Committee may, in its discretion, have service contracts which may be The rationale for any changes from make payments in addition to salary, terminated by the Company for breach by the Policy in operation will be clearly in respect of any contractual benefits the executive or by either the Company or explained in the Remuneration Report in including retirement benefits, apportioned executive giving 12 months notice. respect of that year. for the length of the notice period, Service contracts for new Executive subject to mitigation if alternative The maximum level of variable pay Directors will generally be limited employment is taken up. which may be awarded to new Executive to 12 months notice. However, the Directors in the year of recruitment would Committee may agree a longer period, of normally be in line with the maximum up to 24 months initially, reducing by one level of variable pay that may be awarded month for every month served until it falls under the Annual Bonus Plan and the to 12 months. Performance Share Plan as described in the Policy, and, in any circumstances, the maximum level of annual variable pay that may be awarded (excluding buyout awards) will not exceed 400% of base salary, in line with the maxima set out in the Policy table for the Annual Bonus and Performance Share Plan combined.

UBM Annual Report and Accounts 2017 75 Directors’ Remuneration Report continued Section 2 – The Directors’ Remuneration Policy Report

Annual bonus −− Performance Share Plan – Awards Corporate events Executive Directors may be eligible to made under the Performance Share Change of control Plan will generally lapse if the receive a bonus payment in respect of the −− Deferred Bonus Plan – Awards under Executive Director leaves employment financial year in which they leave; however, the 2014 Deferred Bonus Plan will before the end of the vesting period, there is no contractual entitlement to normally vest in full upon a change of unless they are considered to be an a bonus. In determining eligibility for control. a bonus, consideration will generally ‘Approved Leaver’. To the extent that be given to the circumstances of their awards do not lapse, awards would −− Performance Share Plan – The rules leaving (including future employment) and normally vest on the normal vesting of the Performance Share Plan provide performance during that year. Where a date unless the Committee determines that awards would normally vest at the bonus payment is made, it will generally that awards vest on cessation. Awards time of the event taking into account be on a pro-rata basis for the period vest taking into account the extent the extent to which any applicable served during the year based on an to which any applicable performance performance conditions are satisfied assessment of performance. conditions are satisfied and, unless the and, unless the Committee determines Committee determines otherwise, the otherwise, the period of time that has Long-term incentives period of time that has elapsed since elapsed since grant. The treatment of leavers under our grant. −− All-Employee Share Plans – Awards long-term incentive plans is determined − is limited to held under all-employee plans would by the relevant plan rules. The Committee − ‘Approved Leaver’ individuals leaving by reason of normally be expected to vest on a will determine when awards vest and death, injury, disability, ill health, the change of control and those which the period during which awards may participant’s employing Company have to meet specific requirements to be exercised. ceasing to be part of the Group or benefit from permitted tax benefits −− Deferred Bonus Plan – Awards in such other circumstance as the would vest in accordance with those made under the Deferred Bonus Plan Committee determines (except where a requirements. will generally lapse if the Executive participant is summarily dismissed). The Committee may permit participants Director leaves employment before Other payments to exchange Performance Share Plan or the end of the vesting period, unless The Committee reserves the right to Deferred Bonus Plan awards for awards in they are considered to be an ‘approved make any other payments in connection shares of the acquiring Company. leaver’. In such circumstances awards with a Director’s cessation of office or will normally vest on the normal date employment where the payments are Other corporate events unless the Committee determines that made in good faith in the discharge If other corporate events occur (such as awards should vest on the date the of an existing legal obligation (or by a winding-up of the Company, demerger, Director leaves. way of damages for breach of such an delisting, special dividend or any other obligation), or by way of settlement event which, in the opinion of the of any claim arising in connection with Committee, may affect the current or the cessation of a Director’s office or future value of the awards) the Committee employment. Any such payments may may determine whether, and to what include paying any fees for outplacement extent, awards will vest. assistance and/or the Director’s legal and/or professional advice fees in connection with their cessation of office or employment.

76 UBM Annual Report and Accounts 2017

Section 3 – The Directors’ Annual Remuneration Report

Committee roles and advisers Activities of the Committee founding member of the Remuneration Strategic report The following Directors were members of The Committee met six times during Consultants Group and adheres to its the Committee during 2017: the year, and its main objectives were Code in relation to executive remuneration as follows: consulting in the UK. −− Greg Lock (Chairman) During the year separate teams within −− Reviewed 2017 Executive Directors’ −− Dame Helen Alexander Deloitte have provided consulting services (until 5 August 2017) performance and determined the annual bonus outcomes payable in in relation to the Events First strategy. −− Mary McDowell March 2018; The Committee is satisfied that the advice Governance −− David Wei −− Agreed 2018 objectives for the they have received has been objective and independent, and that the Deloitte −− Warren Finegold Executive Directors’ annual bonuses; engagement partner and team which (appointed 19 May 2017) −− Approved the vesting of the 2015 provide remuneration advice to the The Committee was advised by the Group Performance Share Plan which occurs Committee do not have connections with Company Secretary, who is secretary to in March 2018 (CEO) and September UBM that may impair their independence. the Committee, the Group Head of Reward 2018 (CFO); and The Committee reviewed the potential for Financial statements and the Group HR Director. The Chief During the year, Deloitte advised the conflicts of interest and judged that there Executive and the Chief Financial Officer Committee in relation to external were appropriate safeguards against such (or a member of her team) also attend developments around market practice, conflicts. Total fees for advice provided to Remuneration Committee meetings from corporate governance, and institutional the Committee during the year amount to time to time. No individual is to participate investor views. Deloitte also provided £38,950. Fees are charged on a time and in matters directly concerning their own TSR performance monitoring for expense basis. remuneration. The Committee’s terms outstanding Performance Share Plan of reference provide further details awards. Deloitte was appointed by the of its role and responsibilities and are Remuneration Committee following a available on the Company’s website competitive tender process. Deloitte is a (www.ubm.com).

Single figure for total remuneration (audited) The following table sets out the single figure for total remuneration for Directors for the financial years ending 31 December 2016 and 2017.

Fixed Variable Short-term Long-term incentive incentives Total Salary Benefits Pension (Annual Bonus) (LTIPs) remuneration Tim Cobbold CEO 2017 £679,575 £13,653 £135,915 £849,384 £1,610,638 £3,289,165 2016 £663,000 £12,254 £132,600 £839,427 £1,699,923 £3,347,204 Marina Wyatt CFO 2017 £461,250 £7,449 £92,250 £459,129 £1,619,2871 £2,639,365 2016 £450,000 £7,040 £90,000 £462,547 n/a £1,009,587 1 Marina Wyatt's LTIPs figure includes a one-off PSP award of 70% of salary that was granted to replace an award forfeited when leaving her role at TomTom NV in addition to her normal award of 150% of salary

Additional notes to the single figure for total remuneration (audited) For the purpose of the single figure for 2017, Tim Cobbold and Marina Wyatt’s 2015 PSP awards have been valued based on the 3 month average share price to 31 December 2017 of £7.22. – Benefits Both Tim Cobbold and Marina Wyatt’s benefits include private health insurance, life cover of four times base salary, and income protection cover. – Pension The Executive Directors received their pension contributions as a cash allowance of 20% of base salary. – Short-term incentive (Annual Bonus) 25% of the Executive Directors’ Annual Bonus awards will be deferred into shares in March 2018. For further information see ‘Bonus Deferral’ on page 79.

UBM Annual Report and Accounts 2017 77 Directors’ Remuneration Report continued Section 3 – Directors’ Annual Remuneration Report

Taxable Non-Executive Directors Cash fees Equity fees Benefits* Total Dame Helen Alexander1 2017 £92,663 £71,739 £242 £164,644 2016 £155,000 £120,000 £953 £275,953 Alan Gillespie2 2017 £19,022 £6,822 £369 £26,213 2016 £50,000 £18,000 £946 £68,946 Greg Lock3 2017 £99,529 £63,333 £589 £163,451 2016 £52,000 £18,000 £736 £70,736 Terry Neill 2017 £40,000 £18,000 £3,914 £61,914 2016 £40,000 £18,000 £5,584 £63,584 John McConnell 2017 £52,000 £18,000 £0 £70,000 2016 £52,000 £18,000 £0 £70,000 Mary McDowell 2017 £40,000 £18,000 £2,354 £60,354 2016 £40,000 £18,000 £4,045 £62,045 Trynka Shineman 2017 £40,000 £18,000 £4,570 £62,570 2016 £33,333 £15,000 £7,897 £56,230 David Wei 2017 £40,000 £18,000 £5,384 £63,384 2016 £6,667 £3,000 £4,034 £13,701 Warren Finegold4 2017 £24,637 £11,087 £0 £35,725 2016 – – – – 1 Dame Helen Alexander passed away on 5 August 2017 and fees shown are for the period to this date. 2 Alan Gillespie retired from the Board on 19 May 2017 and fees shown are for the period to this date. 3 Greg Lock's 2017 figure includes an additional fee of £86,666 for his time as Acting Chairman from 21 July to 31 December 2017. It has been calculated as the difference between the Non-Executive Chairman's fee and the fees he would have otherwise received, and pro-rated to take account of the time spent as Acting Chairman. 4 Warren Finegold joined the Board on 19 May 2017 and fees shown are for the period from this date. * Taxable benefits for the Non-Executive Directors relate to travel and accommodation costs for UBM Board and Committee meetings.

Bonus performance measures for 2017 (paid in 2018) The table below sets out performance against the 2017 Bonus (based on actual rate).

Metric Actual Performance targets weighting achieved Actual (as % of (as % of Threshold Maximum Performance maximum) maximum) Financial objectives Total adjusted earnings per share 48.7 53.8 53.4 25% 23.1% Adjusted operating profit margin % 27.1 29.9 30.0 25% 25% Revenue of £1m+ events 731.8 808.8 766.0 25% 11.1% Financial objectives - Total 75% 59.2%

Metric Actual achieved weighting (as % of maximum) (as % of maximum) CEO CFO Financial objectives - Total 75% 59.2% 59.2% Personal objectives - Total 25% 24.1% 23.7% Total (as a % of maximum bonus) 83.3% 82.9% Total (as % of salary) 125% 99.5% Total value (£'000) £849,384 £459,129

78 UBM Annual Report and Accounts 2017 The Annual Bonus Plan is structured 2018 implementation. We continued outstanding awards. Having successfully Strategic report such that 75% of the maximum award is the focus on the customer with disposed of the business and returned based on performance against financial standardised customer metrics now in a special dividend to shareholders to objectives and 25% with reference to place for Platinum, Gold and Silver events. do otherwise would have required the personal objectives. Operational efficiency across the Group Committee to make many assumptions improved, particularly across the back as to make the resulting measures very The three financial measures, Earnings office, including the set-up of our Asia difficult to substantiate. per Share, Group adjusted operating shared service centre. profit margin (before strategic operating – PRN – ROACE stretch target Governance expenditure) and Revenue of £1m+ Events The Committee therefore judged that for The ROACE measure includes a stretch have been selected because they align the CEO, 96.5% of the 25% maximum target of a 1% increase in the ROACE closely with the Events First strategy. and for the CFO, 95% of the 25% on the existing capital (before adjusting EPS reflects the profit performance maximum would be awarded based on for acquisitions). The 1% stretch was set of the business and provides the cover performance against personal goals. in respect of the total Group including for dividend payments to shareholders. For the avoidance of doubt, annual PRN. Given that PRN’s ROACE was The Group adjusted operating profit bonus calculations have been made at approximately six times higher than margin (before strategic operating Financial statements constant currency to recognise underlying the continuing business the Committee expenditure) reflects the operating performance and no discretion was decided to reduce the target increase efficiency of the ongoing business and exercised by the Committee. in ROACE on the existing capital to a key objective of the strategy is to 0.8%, to reflect the sale of PRN. deliver an attractive, improving margin. This resulted in total bonus payments of Consistent with our Policy, the Committee The Revenue of £1m+ Events was chosen 83.3% of maximum bonus for the CEO is comfortable that the revised target as the most appropriate revenue measure (a bonus of £849,384) and 82.9% of is at least as difficult to achieve for the as the Company strengthened the global maximum bonus for the CFO (a bonus of continuing business. Events portfolio, rationalising smaller, £459,129). lower growth, lower margin events. – Strategic operating Bonus Deferral As referred to in the Chairman’s review, expenditure 25% of these bonus awards will be 2017 was another successful year in deferred into shares for three years under Additional re-organisational expenditure implementing the Group’s Events First the Deferred Bonus Plan. This amounts of £20m-£25m over 2015 to 2017 strategy and delivering strong financial to £212,346 for the CEO and £114,782 for was approved by the UBM Board. performance. As shown in the Bonus the CFO. A reorganisation of this nature and scale performance table (page 78), the overall was not envisaged when the stretching pay-out against the financial elements LTIPs due to vest in 2018 PSP targets were set. The Committee was 59.2% out of a maximum of 75%. (in respect of the performance decided that, in determining the The personal objectives set for the CEO performance of the business for the EPS period 1 January 2015 to and ROACE elements of the PSP, it should and the CFO, reflected the key strategic 31 December 2017) growth imperatives of revenue growth, be assessed based on earnings/returns As outlined in last year's Annual Report, attractive margins and establishing the before this reorganisational expenditure. the Committee made a number of best platforms. This ensures a like-for-like comparison judgements in respect of the assessment across the performance period. To ensure Excellent progress was made against of performance under the Performance consistency similar adjustments will be the revenue growth strategy and these Share Plan (PSP) to reflect changes in made where expenditure is incurred in adjusted annual events underlying growth the business and the implementation of either the base or the final performance accelerated to 5.3%. The integration of the Events First Strategy. The changes measurement periods. AllWorld progressed successfully and outlined will also apply to 2015 PSP The change in strategy, and the actions performance was ahead of the acquisition awards which are due to vest based taken as a consequence, have been very business case. on performance to 31 December 2017. significant and beneficial for shareholders. The changes that will impact the The operating margin of the business Bearing in mind the changes in the 2015 awards are summarised below. increased to 29.3%. business the Committee has exercised The Committee consulted with our largest judgement to ensure achievement The third and final year of the shareholders last year in relation to of the objectives remained at least rationalisation of low margin events and these areas of judgment to ensure the as challenging. non-aligned OMS activities was completed rationale was clear and to obtain their and specific improvement plans for lower feedback and was pleased with the level – ROACE definition growth events – 'spotlight' events – of support received. The ROACE definition has been applied as delivered improved growth performance. previously approved which is detailed on The procurement programme delivered – PRN disposal page 170 in the glossary. The Committee further savings in line with the plan for For unvested PSP awards, the Committee had previously decided that for the the year. decided to adjust the ROACE and EPS purpose of incentives this definition targets by removing PRN’s contribution The Sales, Marketing and Data Excellence should apply for both calculation of the in respect of targets set and the programmes continued with the Sales targets and the outturn in order to ensure assessment of performance from the roll out in EMEA and Asia and advanced consistency with wider reporting. start of the performance period for all planning for the Americas in place for UBM Annual Report and Accounts 2017 79 Directors’ Remuneration Report continued Section 3 – Directors’ Annual Remuneration Report

The PSP awards for the performance period 1 January 2015 to 31 December 2017 were based one third on relative TSR performance, one third on EPS and one third on ROACE. The following summarises the performance targets and actual performance.

Threshold Maximum Actual (25% vesting) (100% vesting) performance Vesting TSR relative to the FTSE 250 (excluding Median Outperformance Outperformance 100% investment trusts) by 10% p.a. of 11.9% p.a. EPS growth1 5% p.a. growth 9% p.a. growth 47.0p (14.2% p.a. growth) 100% ROACE 12.8% 13.1% 13.7% 100%

Total 100% 1 The average EPS for 2017 and 2016 compared to the average EPS for 2014 and 2013.

This resulted in a 100% vesting outcome for the 2015 PSP and the below number of options vesting. The value is based on the three month average share price to 31 December 2017 of £7.22.

Aggregate PSP Options PSP options Dividend Shares value of LTIPs granted in 2015 vesting accrued vesting vesting Tim Cobbold 201,532 201,532 21,548 £1,610,638 Marina Wyatt 203,4011 203,401 20,8772 £1,619,287 1 Consists of normal award (150% of salary) and a buy-out award (70% of salary) to replace awards forfeited by leaving previous role. 2 Includes estimated dividends to 2 September 2018.

LTIPs granted during 2017 (audited) The table below sets out details of the awards made under the PSP during 2017.

Number 1 % of shares of options Face value vesting for awarded % of base threshold Performance Executive Director during 2017 Type of award Performance Conditions £ salary performance measurement period Tim Cobbold 163,428 Nil-cost option 1/4 EPS growth £1,155,273 170% 25% (2017 LTIP award) 1/4 ROACE 1 January 2017 to Marina Wyatt 97,874 Nil-cost option 1/4 Relative TSR growth £691,871 150% 25% 31 December 2019 (2017 LTIP award) 1/4 Total Group Revenue growth (see overleaf for full detail on performance targets) 1 Face value was calculated using the five-day average share price prior to grant (706.9p) for awards to Tim Cobbold and Marina Wyatt made on 24 May 2017.

80 UBM Annual Report and Accounts 2017 The table below sets out the performance measures and targets that apply to the PSP awards granted in 2017 Strategic report

Earnings per share Performance metrics EPS growth in excess of 10% p.a. = 100% vesting; EPS growth of 6% p.a. = 25% vesting; EPS growth between 6% and 10% p.a. = vesting calculated on a straight-line basis, EPS growth below 6% p.a. = 0% vesting

Methodology UBM’s Events business has a number of biennial shows, with odd-year biennials significantly larger and more profitable than even-year biennials. The profit contribution from the odd-year biennials leads to an Governance annual distortion in the reported growth rate and profitability of the Events business and an increase in EPS in odd years To give a fairer reflection of underlying performance, a two-year average of Group adjusted (diluted) EPS (of odd and even years) will be applied, with the two-year average prior to the performance period used as the base year, and the two-year average at the end of the performance period used to determine growth For PSP awards made in 2017 (with a three-year performance period of 1 January 2017 to 31 December 2019) the two-year average for the base year is based on EPS for 2015 and 2016 and the two-year Financial statements average at the end will be based on EPS for 2018 and 2019

Return on average capital employed

Performance metrics The target is the weighted average of the following: 1. Existing capital – Returns on existing capital (i.e. ROACE at the start of the performance period) must maintain or exceed current levels by the end of the three-year period. ROACE for 2016 was 13.1%. Target is to maintain ROACE at 13.1% with a stretch to 13.9%, with straight-line vesting in between. As outlined on page 80 the targets include the stretch hurdle of ROACE threshold plus 0.8% (maximum) 2. New investments – Acquisitions should achieve a minimum of the business case return during the three-year performance period. For the sake of simplicity, any capital invested during the three-year performance period will be regarded as new investment

Relative total shareholder return

Performance metrics UBM’s TSR to outperform, over a three-year period, the TSR of the FTSE 250 general industry index (excluding Investment Trusts) Outperform median of the FTSE 250 by 10% p.a. = 100% vesting; Median = 25% vesting: In between these positions = vesting calculated on a straight-line basis; Below median = zero vesting

Revenue

Performance metrics Total Group Revenue (TGR) – all revenue from events and non-events revenue, organic revenue growth and business cases of relevant acquisitions (see below). For achievement of 95% of the TGR in the three year plan (threshold), 100% of the plan (target) and 102% of the plan (maximum), then 25%, 80% and 100% of the award will vest with straight-line vesting in between

When assessing the level of vesting under the PSP, the Committee will consider the underlying financial performance of the Company and the value generated for shareholders and may adjust the level of vesting if it considers that the outcome based on the assessment of performance against targets does not reflect this. In particular, when assessing performance for the revenue portion of the award the Committee will consider the quality of revenue growth delivered, adjusted for acquisitions and disposals, including margin achieved and the impact on profitability to ensure any revenue growth rewarded via the PSP represents value improvement for shareholders. Payments to past Directors (audited) Robert Gray retired from the Board on 31 July 2015 and had two outstanding awards under the Performance Share Plan (PSP). During 2017, 79,179 shares vested under the PSP awarded in June 2014, equating to a value of £554,484 (including accrued dividends). This figure updates and replaces the estimated figure of £563,188 included in last year’s report. Robert Gray has one outstanding award, 134,822 shares under the PSP awarded in June 2015. The estimated value of the 2015 PSP award which vests is £1,077,484. This reflects the 100% vesting outcome for the 2015–17 performance period, includes accrued dividends to the March 2018 vesting date, is prorated for his service to the PRN sale date when he exited the Group, and is based on the three month average share price to 31 December 2017 of £7.22. Loss of office payments (audited) No payments were made in 2017.

UBM Annual Report and Accounts 2017 81 Directors’ Remuneration Report continued Section 3 – Directors’ Annual Remuneration Report

Directors’ shareholdings and share interests (audited) The Executive Directors are generally expected to achieve the relevant shareholding guideline five years after appointment. From 1 January 2017 shareholding guidelines were increased from 150% of salary to 200% of salary for the CEO and 100% of salary to 150% of salary for the CFO.

Unvested Unvested awards, Unvested Shares awards, subject to options, Vested Shareholding Current owned subject to continued subject to awards, not requirement shareholding* Date to meet Requirement Director outright performance employment performance exercised (% of salary) (% of salary) requirement met Tim Cobbold 135,962 0 97,027 596,097 0 200% 144% 17 May 2022 No Marina Wyatt 30,248 0 26,378 442,601 0 150% 47% 17 May 2022 No The previous shareholding guidelines of 150% for the CEO and 100% for the CFO are to be met by the original dates (6 May 2019 and 1 September 2020 respectively) *Calculated by multiplying the number of shares owned outright by the three month average share price to 31 December 2017 of £7.22

Total interests in shares (audited) The table below sets out the Directors’ current interests in UBM shares shown as at 31 December 2017 (or date ceased to be a Director if earlier).

Bonus Ordinary Deferral shares1 at 31 shares2 at 31 December December 2017 2017 Executive Directors Tim Cobbold 135,962 90,113 Marina Wyatt 30,248 22,568 Non-Executive Directors Dame Helen Alexander 66,040 n/a Warren Finegold 20,000 n/a Alan Gillespie 20,858 n/a Greg Lock 30,925 n/a John McConnell 5,694 n/a Mary McDowell 4,336 n/a Terry Neill 46,991 n/a Trynka Shineman 1,618 n/a David Wei 623 n/a 1 Includes shares held under the Company's Sharebuild Plan (SIP). 2 Bonus Deferral shares represent interests in shares acquired by Tim Cobbold and Marina Wyatt through the surrender of cash bonuses and also includes the associated dividend shares accrued to date. These interests are also shown as Deferred Bonus Plan awards in the Scheme interests table.

Changes since year end: On 16 January 2018 Tim Cobbold and Marina Wyatt both purchased 20 and 19 shares respectively at a cost of £7.66 per share and on 16 February 2018 Tim Cobbold and Marina Wyatt both purchased 16 and 17 shares respectively at a cost of £8.95 per share under the Company’s Sharebuild (SIP) Plan.

82 UBM Annual Report and Accounts 2017 Scheme interests Strategic report The table below shows details of outstanding awards held by Executive Directors, including awards granted in 2017 under the Group’s long-term incentive plan. PSP awards were subject to the achievement of performance conditions which were set at grant. DBP awards are based on the prior achievement of annual performance conditions and vest subject to continued employment only.

Accrued Exercised dividend Held at 1 / released Vested Granted Lapsed Held at 31 shares at Date of January during but during during December Vesting Exercise Exercise 31 December Director / Scheme grant 2017 2017 unexercised 2017 2017 2017 date period to price (p) 2017 Governance Tim Cobbold Performance Share Plan (Shares) 27.06.14 217,597 167,274 0 0 50,323 0 27.06.17 26.06.24 n/a 01 27.06.14 62,718 48,213 0 0 14,505 0 27.06.17 26.06.24 n/a 02 06.03.15 201,532 0 0 0 0 201,532 06.03.18 05.03.25 n/a 21,548 03.03.16 191,683 0 0 0 0 191,683 03.03.19 02.03.26 n/a 12,792

24.05.17 0 0 0 163,428 0 163,428 24.05.22 23.05.27 n/a 5,114 Financial statements Deferred Bonus Plan 06.03.15 23,317 0 0 0 0 23,317 06.03.18 05.03.18 n/a 2,493 03.03.16 32,898 0 0 0 0 32,898 03.03.19 02.03.26 n/a 2,195 10.03.17 0 0 0 28,324 0 28,324 10.03.20 09.03.27 n/a 886 SAYE Scheme (Options) 09.04.15 6,914 0 0 0 0 6,914 01.06.20 30.11.20 433.87p n/a Marina Wyatt Performance Share Plan (Shares) 02.09.15 138,683 0 0 0 0 138,683 02.09.18 01.09.25 n/a 10,777 02.09.15 64,718 0 0 0 0 64,718 02.09.18 01.09.25 n/a 5,030 03.03.16 114,795 0 0 0 0 114,795 03.03.19 02.03.26 n/a 7,661 24.05.17 0 0 0 97,874 0 97,874 24.05.22 23.05.27 n/a 3,063 Deferred Bonus Plan 03.03.16 6,069 0 0 0 0 6,069 03.03.19 02.03.26 n/a 404 10.03.17 0 0 0 15,607 0 15,607 10.03.20 09.03.27 n/a 488 Restricted Share Award 02.09.15 49,720 49,720 0 0 0 0 13.05.17 01.09.25 n/a n/a SAYE Scheme (Options) 07.04.16 3,810 0 0 0 0 3,810 01.06.19 30.11.19 472.4 n/a 1 18,341 dividend shares exercised during 2017. Share price at exercise was 702.02p. 2 5,286 dividend shares exercised during 2017. Share price at exercise was 702.02p.

Executives undertaking external appointments The Company considers that permitting Executive Directors to hold office as a Non-Executive Director of another Company will benefit UBM by increasing their knowledge and experience. In normal circumstances, Executive Directors are permitted to accept one outside corporate directorship, subject to Board approval. In exceptional circumstances two directorships may be allowed. Directors are entitled to retain the fees earned. Tim Cobbold is an independent Non-Executive Director of Drax Group plc and received fees of £55,000 during 2017. Marina Wyatt is a Non-Executive Director of Renewi plc (previously called Shanks Group plc) in the UK, receiving fees of £54,105 during 2017 and a member of the Supervisory Board of Lucas Bols NV in The Netherlands receiving fees of €30,000 during 2017. Both roles were held by Marina at the time of her recruitment, and the Board therefore considered it was appropriate that she continued in these roles. The Board keeps this position under review but given the relative size of the companies and time commitment required, it remains comfortable that this does not impact on Marina’s ability to properly carry out her UBM role.

UBM Annual Report and Accounts 2017 83 Directors’ Remuneration Report continued Section 3 – Directors’ Annual Remuneration Report

Historic executive pay and Company performance TSR performance and CEO remuneration outcomes The graph below compares the TSR of UBM and the FTSE 250 Index. The FTSE 250 Index includes the comparator companies for the 2017 PSP award and is therefore considered by the Committee to be the appropriate index against which the TSR of the Group should be compared. 4.5

4

3.5

3

2.5

2

1.5

1

0.5

0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

UBM FTSE 250 TSR Data from Deloitte

Historic CEO pay outcomes The table below summarises the CEO single figure for total remuneration, annual bonus payout and LTIP vesting as a percentage of maximum opportunity for the current year and previous six years.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 CEO Single figure of remuneration £1,593,146 £1,903,046 £1,672,558 £3,936,448 £1,596,962 £1,219,088 £1,592,319 £3,347,204 £3,289,165 Annual bonus pay-out (as % maximum opportunity) 73.6% 93.2% 87.7% 89.7% 93.3% 80.0% 79.4% 84.4% 83.3% Long-term incentive vesting (as % maximum opportunity) 11.3% 16.4% 0% 86.9% 0% n/a n/a 76.9% 100% 1 Tim Cobbold was appointed CEO on 6 May 2014, prior to this the CEO was David Levin.

Change in remuneration of the CEO compared to UBM employees The table below sets out the increase in total remuneration of the CEO and that of the comparator group selected by the Committee. The employee comparison consists of all UK-based employees. It has been selected because it represents a wide variety of roles, responsibilities and pay levels and because these employees are also subject to the same cost of living standards and income tax regime as the CEO.

% change in benefits % change in (excluding % change in base salary pension) bonus CEO 2.5% 11.4% 1.2% UK Employees 2.7% 4.6% 6.0%

Relative spend on pay The chart below shows the actual expenditure on pay for all employees compared with profit after tax and distributions to shareholders for 2016 and 2017 Relative spend on pay The information shown in this chart in based on the following: £m 300 −− Profit after tax from continuing operations – Taken from the Group consolidated income statement see page 100 250 −− Distribution to shareholders – Total dividends see 200 page 137 150 −− Total employee pay – Total employment costs see page 100 144, including: wages and salaries, social security costs, 50 pension and share-based payments note 7.3

0 * 2016 distributions to shareholders excludes £243.7m special dividend Profit after tax for Distributions to All employee pay (£m) continuing operations (£m) shareholders (£m)

2016 2017 84 UBM Annual Report and Accounts 2017 Statement of shareholding voting Strategic report The table below sets out the results of the votes on the 2016 Remuneration Report and Remuneration Policy at the 2017 AGM.

Votes for Votes against Votes withheld Number % Number % Number Remuneration Policy 285,384,424 89.69% 32,801,165 10.31% 7,234 Directors' Remuneration Report 293,762,864 94.96% 15,598,376 5.04% 8,831,583

Votes withheld have been excluded from the percentage calculations. Governance Statement of implementation of remuneration policy in the following financial year The following tables set out the key details of each element of the Remuneration Policy to be in operation during the financial year ending 31 December 2018. Executive Directors

Component Maximum Opportunity Performance Measures Performance Targets Financial statements Base Salary −− Tim Cobbold: £700,000 - 3% change Not applicable Not applicable −− Marina Wyatt: £475,100 - 3% change 2018 increase is effective 1 February Pension Level of contribution/allowance Not applicable Not applicable dependent on local market and seniority of the individual 20% pension allowance or contribution to DC pension plan Benefits Executive Directors receive healthcare, Not applicable Not applicable income protection and life assurance benefits Annual For maximum performance: The bonus in 2018 The actual target range will be disclosed Bonus Tim Cobbold: 150% of salary will be based on retrospectively in next year's Directors' the following measures: Remuneration Report Marina Wyatt: 120% of salary 75% Financial Targets None of the bonus pays out for performance below threshold −− 25% Adjusted EPS (95% of target) −− 25% Group EBITA margin −− 25% Group Total Events Revenue 25% Personal Objectives Performance Tim Cobbold: The quantum of the PSP Any future PSP awards Total Group Revenue targets will be disclosed Share Plan award will be 170% of base salary will be based on the retrospectively following the end of the (there are Marina Wyatt: The quantum of the PSP following measures: performance period. no planned award will be 150% of base salary −− 25% EPS Growth EPS growth of 6% p.a. = 25% vesting 2018 PSP Awards vest as follows: −− 25% ROACE EPS growth of 10% p.a. = 100% vesting awards as described on −− Threshold performance: 25% of −− 25% Relative TSR ROACE weighted average of: page 69) the award −− 25% Total Group Revenue 1. Existing capital – threshold (25% vesting) −− Maximum performance: 100% of is to meet ROACE for 2017 (i.e. 13.7%) and the award maximum (100% vesting) is to exceed 2017 −− Straight-line vesting between these by 0.8% (i.e. 14.5%) levels of performance 2. New investments - new acquisitions should achieve respective business case return Relative TSR growth at median of FTSE 250 = 25% vesting Relative TSR growth outperforms median of FTSE 250 by 10% = 100% vesting

UBM Annual Report and Accounts 2017 85 Directors’ Remuneration Report continued Section 3 – Directors’ Annual Remuneration Report

Performance measures For 2018 the Committee determined it was appropriate to change the revenue performance measure for the annual bonus plan from £1m+ events revenue to Total Group Events Revenue. This is to support the Company’s drive to improve overall organic revenue at all level of events. The Committee believe this measure is well balanced with the other measures in the bonus plan which focus management on continued profitability and margin efficiency as well as driving our strategic goals through personal objectives set. For PSP awards, the Committee introduced Total Group Revenue alongside TSR, EPS growth and ROACE for awards granted in 2017 onwards. The Committee believes this combination of measures continues to support the delivery of Events First and the creation of shareholder value. UBM has established strong governance and controls around our acquisition strategy, including required returns criteria. This is reported to the Board and, for acquisitions of a certain size, the Board reviews each proposal before determining whether to proceed or not. Furthermore, in order to safeguard against unprofitable organic revenue growth, a consistent approach has been introduced to assess and approve new event launches across the Group. The Committee is confident that it has the governance and controls in place to ensure incentivising revenue growth drives the right management behaviours for the benefit of shareholders, and it will continue to apply its judgement and discretion as appropriate. Non-Executive Directors Non-Executive Directors’ fees are paid partly in cash and partly in UBM shares. Cash fees are paid monthly in arrears. The share- based element is satisfied by the delivery of shares six-monthly in arrears. The Chairman of the Remuneration Committee, the Chairman of the Audit Committee and the Senior Independent Director receive additional fees. The current fees for the Chairman and Non-Executive Directors are shown below.

Cash Shares Chairman £155,000 £120,000 Non-Executive Director £40,000 £18,000 Additional Fee for Remuneration Committee Chairman £12,000 – Additional Fee for Audit Committee Chairman £12,000 – Additional Fee for Senior Independent Director £10,000 –

By order of the Board

Greg Lock Chairman of the Remuneration Committee (during 2017) 27 February 2018

86 UBM Annual Report and Accounts 2017 Directors’ Report

The Directors present their report and the −− make market purchases of up to Employee share plans Strategic report audited financial statements for the year 39,391,411 shares in the Company, The Company operates a number of ended 31 December 2017. representing approximately 10% of all-employee and discretionary share the Company’s issued share capital at Strategic report plans. Shares acquired through Company the time. share schemes and plans rank pari passu The Strategic Report on pages 1 to 45 To date, the Directors have not used the with the shares in issue and have no contains information relating to the authority to make market purchases. special rights. performance of the Company’s business Shares have been allotted during the year during the financial year, the position of Governance to satisfy options under the Company’s Sharesave (Save As You Earn) the Company at the end of the year, and Save As You Earn Scheme. Details of the Under the terms of the Scheme, the likely future developments. number of shares allotted are set out on Board may offer options to purchase page 149. ordinary shares in the Company once in Results for the year and each financial year to those employees dividends Shareholders will be asked to renew the who contribute into a HMRC approved The results for the year are set out in the above authorities at the 2018 AGM in savings contract to save up to £500 line with the most recent institutional per calendar month. The price at which

Group consolidated income statement on Financial statements page 100. The balance to be transferred investors’ guidelines. options may be offered is 80% of the to reserves is £159.5m. The Directors average mid-market price for three recommend a final dividend of 18.0p per Rights and obligations attached consecutive dealing days preceding the share for the year ended 31 December to shares offer date. The options may normally 2017. Subject to shareholders’ approval There are no restrictions on the transfer be exercised during the six month at the 2018 AGM, the final dividend of ordinary shares in the Company, which period after the completion of the will be paid on 24 May 2018 to those is governed by its Articles of Association Sharesave contract. shareholders on the register on and prevailing legislation. The Company Sharebuild (Share Incentive Plan) 20 April 2018. is not aware of any agreements between holders of securities that may result in Sharebuild allows eligible, UK tax resident The following interim dividend was paid restrictions on the transfer of securities employees to purchase UBM Ordinary during the year: or that may result in restrictions on shares out of pre-tax salary (Partnership Shares). Ordinary shares are purchased in −− 12 October 2017 – 5.5p per share voting rights. the market and held in Trust, by Equiniti The total dividends payable in respect of Subject to the applicable statutes, rights Share Plan Trustees Limited, until the the year ended 31 December 2017 amount attached to any class of share may be participant chooses to withdraw from to 23.5p per share (2016: 22.0p). varied with the consent of the holders the Plan. Whilst they are in the Trust, of no less than three-quarters in nominal dividends are paid on the shares and Share capital value of the issued shares of that class, or re-invested into purchasing additional The Company has a premium listing on by special resolution passed at a General shares. The shares must be held in the London Stock Exchange. Details of Meeting of the shareholders. the Trust for a minimum time period the Company’s authorised and issued specified by HMRC to retain their tax Subject to the provisions of the share capital at 31 December 2017 are efficient status. Companies (Jersey) Law 1991 (the as follows: ‘Companies Law’), any resolution passed Discretionary long-term incentives −− Authorised Share Capital: by the Company under the Companies Awards are granted to employees at 1,081,888,657 Law and other shareholders’ rights, the discretion of the Company under −− Issued Share Capital: 394,088,160 shares may be issued with such rights the various long-term incentive plans. and restrictions as the Company may by The UBM ESOP Trust (the Trust) is Powers of the Company to issue or ordinary resolution decide. Subject to an Employee Benefit Trust which at buy back its own shares the Articles of Association, Companies 27 February 2018, being the latest Shareholders approved certain authorities (Jersey) Law 1991 and other shareholder practicable date prior to publication of at the Company’s 2017 AGM related to the rights, unissued shares are at the disposal this Report, holds 388,671 ordinary shares Company’s share capital. The Directors of the Board. of 11.25p each (2017: 759,767 ordinary now have authority to: shares of 11.25p each). The Trust agrees −− allot shares in the Company or to satisfy the awards in accordance grant rights to subscribe for, or with the wishes of the Company and the convert, any security into shares up Trust Deed. The shares are acquired in to an aggregate nominal amount of the market, and dividends are waived on £14,771,779; all shares held in the Trust. The Trust abstains from voting at General Meetings. −− allot shares up to an aggregate nominal amount of £29,543,558, for Further information is available in Note 5.8 the purpose of a rights issue; and to the Accounts on page 136

UBM Annual Report and Accounts 2017 87 Directors’ Report continued

External substantial and ending 60 days following the Greenhouse gas emissions shareholdings consummation of such change of control We have reported on all the emission provided the change in rating is related to sources required under the Companies As at 27 February 2018, being the latest the change in control. practicable date prior to the publication Act 2006 (Strategic Report and Directors’ of this Report, the Company had been The Group has a Revolving Credit Facility Reports) Regulations 2013. We do not notified of the following significant of £400m due in April 2022 which have responsibility for any emission interests in voting rights in its ordinary includes provisions which are triggered on sources that are not included in this share capital in accordance with Chapter a change of control of the Company giving consolidated statement. 5 of the FCA’s Disclosure Rules and each bank the right to repayment of Methodology Transparency Rules: borrowings and reduction in commitment We have followed the 2013 UK to zero. % of Share Government Environmental Reporting Shareholder name Capital The $370m US Private Placement ($45m Guidance and used the GHG Protocol APG Asset Management N.V. 9.02 due in December 2022, $175m due Corporate Accounting and Reporting in December 2024 and $150m due in Standard (revised edition) published Annual General Meeting December 2027) contain provisions which by WBCSD & WRI (the World Business The AGM of the Company will be held are triggered on a change of control of Council for Sustainable Development and at the Company’s London office, 240 the Company. The holders of the notes the World Resources Institute). Blackfriars Road, London SE1 8BF on have the right to repayment of the entire Emission factors were US eGRID Tuesday 15 May 2018 at 2.00pm. A letter unpaid principal amount of notes held 2014 v2 (2017), IEA 2017 and the UK from the Chairman and the Notice of by each holder at 100% of the principal Government Greenhouse Gas Conversion Meeting, containing a description of the amount of such notes at par, together Factors for Company Reporting 2017. business to be transacted, is available on with any interest accrued thereon to The reported emissions also form part of the Company’s website at www.ubm.com. the prepayment date selected by the our submission for the Carbon Disclosure Company and any associated break costs. External auditors Project (CDP). During 2017 the Company undertook an Employees External assurance audit tender process, following which The number of employees of the group Our 2017 greenhouse gas assertion has KPMG were selected as the Company's as at 31 December 2017 was 3,933 been assured against the CDP approved external auditor. Following the approach (2016: 3,852). The average number of verification standard ISO14064-3, by from Informa it was agreed that this employees during the year was 3,891 Carbon Clear Limited. To see the most appointment would be postponed (2016: 3,586). recent assurance statement, please and that EY would continue for the We recognise the value of diversity refer to the Company’s website at: financial year ending 31 December www.ubm.com/about-UBM/sustainability. 2018. Further details of the audit and aim to attract and retain talented tender process can be found in the employees with a wide range of Materiality Audit Committee Report on page 67. backgrounds, skills and experiences. UBM last conducted a materiality A resolution for the appointment and Employees, or potential employees, will assessment during 2015, and now reports remuneration of EY will be proposed at receive the same treatment regardless of on all aspects deemed as material, which the Annual General Meeting. age, gender, sexual orientation, disability, includes the use of energy and materials ethnicity or religion. at our events. Political donations In the event that an employee's Organisational boundary The Group did not make any political circumstances change, every effort is The organisational boundary is donations or incur any political made to ensure that their employment determined by the operational control expenditure during the year ended with the Group continues, including, approach. UBM has operational control 31 December 2017 (2016: £nil). where possible, providing specialised over all office buildings owned and leased training and adjusting employees’ by UBM, including event space leased, but Change of control working environments. The Company is party to change of does not have control over sub-let space control provisions in its principal financing The Group remains committed to and non-UBM tenant emissions. employee involvement, and has continued agreements as follows: Operational scopes its culture of informing and involving We have measured our scope 1, scope The $350m 5.75% bonds due in employees in matters which concern them 2 and certain scope 3 emissions. November 2020 contain provisions which through various channels including Town These carbon emissions are calculated for are triggered on a change of control of Hall meetings, video blogs by the CEO, all global UBM offices and events, where the Company. The holders of such bonds and financial results shared globally via data is available. have the right to repayment at 101% of webcast. The Hub and the Performance par if the Company is non-investment Plus appraisal process are also ways grade on any day during the period in which the Group regularly connects commencing 60 days prior to the first with employees. public announcement of any change of control (or pending change of control)

88 UBM Annual Report and Accounts 2017 Measure of 2017 % 2016 % 2015 % Strategic report Data recorded on: coverage of data of data of data Natural gas at offices Floor area 100% 100% 97% Electricity at offices Floor area 96% 96% 96% Offsite data centres Floor area 100% 100% 100% Fugitive emissions at offices Floor area 16% 18% 11% Water at offices Headcount 41% 41% 35% Waste at offices Headcount 47% 44% 39% Governance Business travel – flights Headcount 19% 19% 36% Business travel – train, taxi, car hire Headcount 62% 62% 57% Commuter travel Headcount Estimated Estimated Estimated Assumptions and estimations Directors and their interests The interests of the Directors in office at Assumptions are kept to a minimum. Biographical details of the Directors in 31 December 2017 in the shares of the Due to the materiality assessment office as at 19 February 2018 are set out Company are set out in the Directors’ Remuneration Report on page 68. carried out in 2015, carbon emissions on pages 47 to 48 and are incorporated Financial statements from employee commuter travel were into this Report by reference. No Director had a material interest not deemed as material and therefore The following Directors held office during in any contract, other than a service have not been calculated since 2015. the year: contract, with the Company or any of its Instead commuter travel emissions subsidiaries at any time during the year. were estimated based on 2014 average −− Dame Helen Alexander emissions per head and up-scaled for the (to 5 August 2017) Directors' and officers' last three years. −− Tim Cobbold liability insurance The Company maintains Directors’ and In addition, where business travel −− Marina Wyatt Officers’ Liability Insurance cover for all emissions were missing for offices not −− Alan Gillespie (to 17 May 2017) Directors, officers and senior employees yet included in the global data allocation against liabilities which may be incurred software, these were scaled up using the −− Warren Finegold (from 19 May 2017) by them whilst performing their duties for 2017 average per head. The percentage −− Greg Lock the Company or any of its subsidiaries. of data collected has been recorded for −− John McConnell The insurance is governed by English Law. each source of emissions and is detailed in the below table. −− Mary McDowell Statement of Directors’ Base year −− Terry Neill responsibilities 2015 has now been set as the base −− Trynka Shineman So far as each Director of the Board year, as this was when we achieved our is aware, there is no relevant audit −− David Wei previous target and set a new science- information of which the Company’s based carbon emissions reduction In accordance with the 2016 UK Corporate external auditor is unaware, and each target. Base year recalculation policy is Governance Code (the Code) all current Director has taken all steps necessary reviewed annually and takes into account Directors will submit themselves for in order to make themselves aware any significant business change above election or re-election at the Annual of, and to establish that the external a 5% threshold and/or developments General Meeting. auditor is aware of, any relevant audit in climate change or carbon The Chief Executive Officer and Chief information. The Directors are responsible management regulation. Financial Officer each have a service for preparing the Annual Report and the contract which is subject to 12 months’ financial statements in accordance with notice on either side. The Chairman has applicable law and regulations. a contract for services which is subject to six months’ notice from either party. None of the Non-Executive Directors have a service contract and all are considered by the Company to be independent.

UBM Annual Report and Accounts 2017 89 Directors’ Report continued

The Companies (Jersey) Law 1991 Directors’ responsibility Other information requires the Directors to prepare financial statement pursuant to Other information relevant to and forming statements for each financial period part of the Directors’ Report is to be in accordance with generally accepted Disclosure and Transparency Rule 4 found in the following sections of the accounting principles prescribed for Annual Report: the purposes of the Companies Law for Each of the Directors at the date of this market traded companies. The financial Report, whose names and functions are Location in statements of the Company are required listed on pages 47 to 48 confirm that, to Information Annual Report by law to give a true and fair view of, or the best of their knowledge: Strategic Report be presented fairly in all material respects −− the Group financial statements in this −− Strategy (pages 1 to 45) so as to show the state of affairs of Report, which have been prepared in −− Risk Management (pages 30 to 35) the Company at the end of the period accordance with International Financial Operating and Financial covered by the financial statements and Reporting Standards (IFRS) as issued Review (pages 36 to 45) of the profit or loss of the Company for by the International Accounting Governance that period. In preparing these financial Standards Board (IASB) and the statements, the Directors should: −− Corporate Governance International Financial Reporting Statement (pages 50 to 51) −− select suitable accounting policies and Interpretations Committee (IFRIC), −− Nominations Committee (pages 52 to 53) then apply them consistently and the Company financial statements −− Audit Committee (pages 61 to 67) in this Report, which have been −− make judgements and estimates that −− Remuneration prepared in accordance with United are reasonable Committee (pages 68 to 86) Kingdom accounting standards, give Treasury Policy −− specify which generally accepted a true and fair view of the assets, accounting principles have been liabilities, financial position and result • Financial Review (page 44) followed in their preparation of the Company and the undertakings • Section 5 of the Financial Statements (pages 126 to 137) −− prepare the financial statements on included in the consolidation taken as the ‘going concern’ basis unless it is a whole; and Going Concern (page 45) inappropriate to presume that the −− the Strategic Report on pages 1 The Directors’ Report of UBM plc for the Company will continue in business to 45 includes a fair review of the year ended 31 December 2017 comprises The Directors are responsible for keeping development and performance of pages 87 to 90 of this Annual Report and accounting records which are sufficient the business and the position of the other sections listed above, which are to show and explain the Company’s the Company and the undertakings incorporated into the Directors’ Report transactions and are such as to disclose included in the consolidation taken as by reference. with reasonable accuracy at any time the a whole, together with a description By order of the Board financial position of the Company and of the principal risks and uncertainties enable them to ensure that the financial that they face. statements prepared by the Company Post balance sheet events comply with the requirements of the Companies (Jersey) Law 1991. They are Listing Rule 9.2.18 – profit estimate also responsible for safeguarding the previously published assets of the Group and the Company and On 30 January 2018 the Group published hence for taking reasonable steps for the a profit estimate, as part of the Mark Peters prevention and detection of fraud and recommended offer by Informa PLC. Group Company Secretary other irregularities. The Group confirms that the reported 27 February 2018 numbers for the same period have been UBM plc The Directors are responsible for disclosed in this annual report and are in the maintenance and integrity of the Registered number: 100460 line with the profit estimate. Registered office: 44 Esplanade, St. Helier, Jersey corporate and financial information JE4 9WG included on the Company’s website. Details of material post Balance Sheet Legislation in Jersey governing the events can be found in note 8.3. preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

90 UBM Annual Report and Accounts 2017 Financial statements

In this section

Financial Statements Section 4 – Section 6 – Independent auditor’s report Financial position 117 Acquisitions and disposals 138 to the members of UBM plc 92 4.1 Goodwill 117 6.1 Acquisitions 138 Consolidated income statement 100 4.2 Intangible assets 119 6.2 Equity transactions 141 Consolidated statement of 4.3 Property, plant and 6.3 Disposals 141 comprehensive income 101 equipment 120 6.4 Discontinued operations Consolidated statement of 4.4 Investments in joint and assets held for sale 142 financial position 102 ventures and associates 122 Section 7 – Consolidated statement 4.5 Working capital 123 Employee benefits 144 of changes in equity 103 4.5.1 Trade and other 7.1 Employee costs 144 Consolidated statement receivables 123 7.2 Retirement benefit of cash flows 104 4.5.2 Trade and other payables 124 obligations 144 Section 1 – 4.6 Provisions 124 7.3 Share-based payments 149 Basis of preparation 105 Section 5 – Section 8 – Section 2 – Capital structure and Other notes 151 Segment information 108 financial policy 126 8.1 Group subsidiaries 151 Section 3 – 5.1 Movements in net debt 127 8.2 Related party Operating profit and tax 110 5.2 Cash and cash equivalents 127 transactions 158 3.1 Revenue 110 5.3 Borrowings 127 8.3 Events after the 3.2 Other operating income 110 5.4 Net financing expense 128 reporting period 158 3.3 Operating expenses 110 5.5 Derivative financial Additional information 159 3.4 Operating leases 111 instruments and hedging Five year summary 159 3.5 Exceptional operating activities 129 Exchange rates 159 items 111 5.6 Fair values and fair value UBM plc parent company 3.6 Tax 112 hierarchy 131 financial statements and 3.7 Earnings per share 115 5.7 Financial risk management related notes 160 objectives and policies 134 5.8 Equity and dividends 136

UBM Annual Report and Accounts 2017 91 Independent auditor’s report to the members of UBM plc

Opinion In our opinion: −− UBM plc’s Group financial statements and parent company financial statements (the “financial statements”) give a true and fair view of the state of the group’s and of the parent company’s affairs as at 31 December 2017 and of the group’s profit and the parent company’s profit for the year then ended; −− The Group financial statements have been properly prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and in accordance with the requirements of the Companies (Jersey) Law 1991; and −− The Parent company financial statements have been prepared in accordance with United Kingdom accounting standards, including FRS 101 Reduced Disclosure Framework, and in accordance with the requirements of the Companies (Jersey) Law 1991. We have audited the financial statements of UBM plc which comprise:

Group Parent company Consolidated balance sheet as at 31 December 2017 Balance sheet as at 31 December 2017 Consolidated income statement for the year then ended Income statement for the year then ended Consolidated statement of comprehensive income for the year then Statement of comprehensive income for the year then ended ended Consolidated statement of changes in equity for the year then ended Statement of changes in equity for the year then ended Consolidated statement of cash flows for the year then ended Related notes 1 to 8.3 to the financial statements, including a Related notes 1 to 15 to the financial statements including a summary summary of significant accounting policies of significant accounting policies The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as issued by the IASB. The financial reporting framework that has been applied in the preparation of the parent company financial statements is applicable law and United Kingdom Accounting Standards, including FRS 101 “Reduced Disclosure Framework”. Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report below. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Use of our report This report is made solely to the company’s members, as a body, in accordance with Article 113A of the Companies (Jersey) Law 1991. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed. Conclusions relating to principal risks, going concern and viability statement We have nothing to report in respect of the following information in the annual report, in relation to which the ISAs (UK) require us to report to you whether we have anything material to add or draw attention to: the disclosures in the annual report set out on pages 32–34 that describe the principal risks and explain how they are being managed or mitigated; −− the directors’ confirmation set out on page 35 in the annual report that they have carried out a robust assessment of the principal risks facing the entity, including those that would threaten its business model, future performance, solvency or liquidity; −− the directors’ statement set out on page 45 in the financial statements about whether they considered it appropriate to adopt the going concern basis of accounting in preparing them, and their identification of any material uncertainties to the entity’s ability to continue to do so over a period of at least twelve months from the date of approval of the financial statements; −− whether the directors’ statement in relation to going concern required under the Listing Rules in accordance with Listing Rules 9.8.6R(3) is materially inconsistent with our knowledge obtained in the audit; or −− the directors’ explanation set out on page 45 in the annual report as to how they have assessed the prospects of the entity, over what period they have done so and why they consider that period to be appropriate, and their statement as to whether they have a reasonable expectation that the entity will be able to continue in operation and meet its liabilities as they fall due over the period of their assessment, including any related disclosures drawing attention to any necessary qualifications or assumptions.

92 UBM Annual Report and Accounts 2017 Overview of our audit approach Strategic report Key audit matters −− Revenue Recognition arising as a result of inappropriate cut off via the manipulation of deferred revenue −− Recognition of deferred tax assets −− Valuation of acquired intangible assets −− Carrying value of Goodwill Audit scope −− We performed an audit of the complete financial information of 7 components and audit procedures on

specific balances for a further 9 components. Governance −− The components where we performed full or specific audit procedures accounted for 83% of Revenue. Materiality −− Overall group materiality of £10.2m which represents 5% of Profit before Tax before exceptional non- recurring items. Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to Financial statements fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in our opinion thereon, and we do not provide a separate opinion on these matters.

Risk Our response to the risk Key observations communicated to the Audit Committee Revenue recognition arising as a −− For each material revenue stream at full Based on the procedures performed, result of inappropriate cut-off via the and specific scope locations, we identified including those in respect of cut off via manipulation of deferred revenue and assessed the design of key controls manipulation of deferred revenue, we Refer to Note 3.1 of the Consolidated to validate that revenue recognition was did not identify any evidence of material Financial Statements (page 110) appropriate and applied in accordance misstatement in the revenue recognised with the Group’s accounting policies. in the year or revenue deferred at 31 We focused on this area due to the December 2017. significant value of revenue for the Group, −− For a number of components, as part of with continuing revenue of £1,002.9m our overall revenue recognition testing (2016: £863.0m) and discontinued revenue we used data analysis tools to test the of £nil (2016: £204.7m). correlation of revenue transactions to For the Events businesses, there is a cash receipts for 100% of sales through significant lead time in the billing of the year. For those in-scope components customers that can occur up to a year where we did not use data analysis tools, prior to an event taking place. As such, we performed alternative procedures, there is the potential for error and for including substantive transaction testing. management manipulation of the timing of We performed cut-off testing for a revenue recognition. sample of revenue transactions around the period end date, to check that they For the online and print marketing services were recognised in the appropriate businesses, contracts are entered into period. which span the 31 December year end which increases the potential for error and −− Other audit procedures specifically for management manipulation of the timing designed to address the risk of of revenue recognition. management override of controls There is no change in the risk profile in the included journal entry testing, applying current year. particular focus to the timing of revenue transactions. −− For revenue recorded through journal entries outside of normal business processes, we performed testing to establish whether a service had been provided in the financial year to support the revenue recognised. At each full and specific scope audit location with significant revenue streams (16 components), we performed audit procedures which covered 83% of the Group’s Revenue. We also performed review procedures on 7 components which covered a further 7% of the Group’s Revenue.

UBM Annual Report and Accounts 2017 93 Independent auditor’s report to the members of UBM plc continued

Risk Our response to the risk Key observations communicated to the Audit Committee Recognition of Deferred Taxes −− We evaluated management’s rationale Based on the results of our work, we Refer to the Audit Committee Report (page for the forecast periods selected agree with management’s judgements 64); and Note 3.6 of the Consolidated in determining the likelihood of the and estimates in relation to deferred Financial Statements (page 112) Group generating suitable future tax asset recognition in respect of tax profits to support the recognition of losses and specifically in relation to the UBM has recognised deferred tax assets deferred tax assets. We considered forecast periods applied in determining the of £19.7m (2016 restated: £26.8m) that the appropriateness of management’s likelihood of the Group generating suitable relate to tax losses over and above the assumptions based on the known future profits to support the recognition. amount recognised to offset deferred tax facts and circumstances, including the We note that the assumptions and liabilities. In addition there are significant reliability of forecast models, for each tax judgements applied in the forecast models unused tax losses for which no deferred jurisdiction. mean that the range of possible outcomes tax assets have been recognised in respect is broad. of the United Kingdom, United States and −− We evaluated the historical accuracy Luxembourg as set out in Note 3.6. of forecasting taxable profits and the We focus on this area as the assessment integrity of the forecast models and, as of the amount of deferred tax assets a result of these procedures, we formed to be recognised for tax losses involves our own view on the Group’s capacity judgements and estimates in relation to obtain effective relief for tax losses to future taxable profits and hence the and other temporary differences over capacity to utilise available tax assets. the forecast period in the UK, US and Luxembourg. There is no change to the risk profile in the current year. −− We evaluated management’s calculation of the impact of US Tax Reform on the measurement of deferred tax assets and the impact on future taxable profits to support the recognition of deferred tax assets. −− We considered the appropriateness of the Group’s disclosures in respect of deferred tax. The recognition of deferred tax assets in respect of tax losses was subject to full scope audit procedures by the Primary audit team with the assistance of our United States audit of tax team who undertook specific procedures in relation to verifying the underlying gross tax attributes up which the deferred tax assets are calculated and verifying the impact of US Tax Reform.

94 UBM Annual Report and Accounts 2017 Strategic report Risk Our response to the risk Key observations communicated to the Audit Committee Valuation of acquired intangible assets We walked through the controls over the We concluded that the methodology Refer to Audit Committee Report (page valuation of the acquired intangible assets applied to allocate the purchase price is 64); Basis of Preparation (page 106); and and understood management’s process to appropriate and that the assumptions used Note 4.2 of the Consolidated Financial comply with IFRS 3 Business Combinations to determine the fair value of intangible Statements and IFRS 13 Fair Value Measurement. assets acquired are within an acceptable range and that the intangible assets are In 2017, UBM has finalised the purchase With involvement of an EY business valuation specialist, we: appropriately stated in the 31 December price allocation exercise of the fair values Governance 2017 financial statements and 31 December of the assets and liabilities of Allworld, −− Assessed the competence, capabilities 2016 restated comparatives. which was acquired in December 2016 for and objectivity of management’s £379.7m. specialists; and The risk is incorrect identification and −− Evaluated and concluded on the results measurement of the acquired intangible of management’s and its specialist’s assets since the valuation is based on procedures to determine the fair value valuation techniques, which involve of the intangible assets acquired. This significant judgment about the future included: Financial statements results of the business, the discount rates applied to future cash flows and royalty • evaluating the completeness and rates used. existence of intangible assets recognised; • assessment of the valuation methodologies applied; • assessment of the key assumptions made by management, such as customer churn, royalty rates and discount rates, compared to our independently calculated range; • benchmarking the assumptions used with historic UBM acquisitions and other transactions in the sector; and • performing sensitivity analysis to understand the extent to which changes in key assumptions may give rise to a materially different valuation for the intangible asset. In addition, we assessed the prospective financial information utilised in the valuation models based on the viewpoint of a market participant as defined by IFRS 13 Fair Value Measurement. This included evaluating the historical accuracy of forecasting, current performance and adjustment made to pre acquisition/due diligence forecast numbers. We considered the appropriateness of the related disclosures in Note 4.2 of the group financial statements with the requirements of IFRS 3. Audit procedures on the valuation of the acquired intangible assets were performed by the Primary audit team.

UBM Annual Report and Accounts 2017 95 Independent auditor’s report to the members of UBM plc continued

Risk Our response to the risk Key observations communicated to the Audit Committee Carrying Value of Goodwill We challenged management’s assumptions Based on the results of our work, we agree Refer to Audit Committee Report (page used in its impairment models for with management’s conclusion that no 64); Basis of Preparation (page 106); and assessing the recoverability of the carrying impairment of goodwill is required in the Note 4.1 of the Consolidated Financial value of goodwill. We focused on the current year. We agree with management Statements appropriateness of CGU identification, that no reasonably possible change in methodology applied to estimate assumptions would result in a material At 31 December 2017, goodwill amounted recoverable values, discount rates and impairment in any Cash Generating to £1,533.0m (2016 restated: £1,623.6m). forecast cashflows. Specifically: Units and hence no additional sensitivity We focused on this area due to the size −− We validated that changes in the CGUs disclosures are required in Note 4.1 of the of the goodwill balance and because the identified were consistent with changes in Group’s financial statements. directors’ assessment of ‘value in use’ of the business and reflects the lowest level the Group’s Cash Generating Units (CGUs) at which management monitors goodwill involves judgement about the future in accordance with the requirements of results of the business and the discount IAS 36, Impairment of Assets (‘IAS 36’); rates applied to future cash flow forecasts. There is no change in the risk profile in the −− We tested the methodology applied current year. in the value in use calculation (‘VIU’) as compared to IAS 36, Impairment of Assets, and the mathematical accuracy of management’s model; −− Used our EY valuations specialists to assist our assessment of the appropriateness of the impairment review model, discount rate, long term growth rates including comparison to economic and industry forecasts (where appropriate) and other key assumptions; −− Obtained an understanding and performed an assessment of the underlying assumptions for the FY18 budget and implied growth rates beyond FY18; −− Assessed operating results against historic assumptions to assess the historical accuracy of forecasting; −− Validated key areas of judgement in management’s cash flow forecast and impairment review ensuring that revenue is not included from new product development and future restructuring benefits; −− Compared budgets to those forecasts used in other assessments such as going concern and understood any sensitivity within the cash flows and the impact of changes on key areas of judgement; −− For certain CGUs we performed sensitivity analysis by stress testing key assumptions in the model with downside scenarios to understand the parameters that, should they arise, could lead to a different conclusion in respect of the carrying value of goodwill; and −− We assessed the disclosures in Note 4.1 of the financial statements against the requirements of IAS 36 Impairment of Assets. The entire goodwill balance was subject to full scope audit procedures by the Primary audit team.

96 UBM Annual Report and Accounts 2017 In the prior year, our auditor’s report included a key audit matter in relation to the sale of PR Newswire. In the current year this Strategic report matter is no longer considered a risk as the matter was one off in nature. An overview of the scope of our audit Tailoring the scope Our assessment of audit risk, our evaluation of materiality and our allocation of performance materiality determine our audit scope for each entity within the Group. Taken together, this enables us to form an opinion on the consolidated financial statements. We take into account size, risk profile, the organisation of the group and effectiveness of group-wide controls, changes in the business environment and other factors such as recent Internal audit results when assessing the level of work to be performed at each entity. Governance In assessing the risk of material misstatement to the Group financial statements, and to ensure we had adequate quantitative coverage of significant accounts in the financial statements, of the 497 legal entity reporting units within the Group consolidation, we selected 16 (2016:13) components covering entities within the UK, the Netherlands, Hong Kong, China, India, Bahrain, Singapore, Indonesia and the United States which represent the principal business units within the Group. Of the 16 components selected, we performed an audit of the complete financial information of 7 components (“full scope components”) which were selected based on their size or risk characteristics. For the remaining 9 components (“specific scope Financial statements components”), we performed audit procedures on specific accounts within that component that we considered had the potential for the greatest impact on the significant accounts in the financial statements either because of the size of these accounts or their risk profile. The reporting components where we performed audit procedures accounted for 63% (2016: 69%) of the Group’s Revenue. The specific scope component contributed 20% (2016: 13%) of the Group’s Revenue. The audit scope of these components may not have included testing of all significant accounts of the component but will have contributed to the coverage of significant tested for the Group. For 7 components contributing to 7% of the Group’s revenue, the Primary audit team performed specified procedures which included analytical procedures comprising discussion with local management on the performance of key events, variances to expectations for Revenue and certain other income statement and balance sheet accounts, and other enquiries of management. Of the remaining 443 legal entities, the Primary team performed other procedures, including analytical review procedures, and testing consolidation journal entries, intercompany eliminations and foreign currency translation recalculations to respond to any potential risks of material misstatement to the Group financial statements. The charts below illustrate the coverage obtained from the work performed by our audit teams. Revenue

Full scope components: 63% Specific scope components: 20% Other procedures: 17%

Changes from the prior year

Following the acquisition of Allworld in December 2016, in 2017 a full year’s profit has been consolidated in the Group’s income statement. We have designated 4 Allworld legal entities in 2017 as a specific scope component. Involvement with component teams In establishing our overall approach to the Group audit, we determined the type of work that needed to be undertaken at each of the components by us, as the primary audit engagement team, or by component auditors from other EY global network firms operating under our instruction. Of the 7 full scope components, audit procedures were performed on 3 of these directly by the primary audit team. Of the 9 specific scope components, audit procedures were performed on 6 of these directly by the primary audit team. Where the work was performed by component auditors, we determined the appropriate level of involvement to enable us to determine that sufficient audit evidence had been obtained as a basis for our opinion on the Group as a whole. The Group audit team continued to follow a programme of planned visits that has been designed to ensure that the Auditor visits. During the current year’s audit cycle, visits were undertaken by the primary audit team to the full and specific scope component teams in Hong Kong, China, India and the United States. These visits involved meeting with our component teams, discussing key risk areas, meeting management and reviewing key working papers and attend closing meetings. The primary team interacted regularly with the component teams where appropriate during various stages of the audit, reviewed key working papers and were responsible for the scope and direction of the audit process. This, together with the additional procedures performed at Group level, gave us appropriate evidence for our opinion on the Group financial statements. UBM Annual Report and Accounts 2017 97 Independent auditor’s report to the members of UBM plc continued

Our application of materiality We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified misstatements on the audit and in forming our audit opinion. Materiality The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to influence the economic decisions of the users of the financial statements. Materiality provides a basis for determining the nature and extent of our audit procedures. We determined materiality for the Group to be £10.2 million (2016: £9.6 million), which is 5% (2016: 5%) of profit before tax before exceptional non-recurring items. We believe that profit before tax before exceptional non-recurring items provides us with a consistent year on year basis for determining materiality and is the most relevant performance measure to the stakeholders of UBM. We determined materiality for the Parent Company to be £14.4 million (2016: £15.3 million), which is 2% (2016: 2%) of Equity.

Starting basis • Continuing operations profit before tax £191.7m

• add back net continuing exceptional expense Adjustments (before tax) of £12.0m

Materiality • 5% of this adjusted profit before tax of £203.7m, gives materiality of £10.2m

During the course of our audit, we reassessed initial materiality. Our initial materiality was based on forecast profit before tax and non-recurring exceptional items. Performance materiality The application of materiality at the individual account or balance level. It is set at an amount to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality. On the basis of our risk assessments, together with our assessment of the Group’s overall control environment, our judgement was that performance materiality was 75% (2016: 50%) of our planning materiality, namely £7.6m (2016: £4.8m). We have set performance materiality at this percentage due to the stabilisation of the control environment including no fundamental control observations in the prior year. Audit work at component locations for the purpose of obtaining audit coverage over significant financial statement accounts is undertaken based on a percentage of total performance materiality. The performance materiality set for each component is based on the relative scale and risk of the component to the Group as a whole and our assessment of the risk of misstatement at that component. In the current year, the range of performance materiality allocated to components was £1.5m to £4.1m (2016: £0.4m to £1.8m). Reporting threshold An amount below which identified misstatements are considered as being clearly trivial. We agreed with the Audit Committee that we would report to them all uncorrected audit differences in excess of £470k (2016: £400k), which is set at 5% of planning materiality, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds. We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed above and in light of other relevant qualitative considerations in forming our opinion. Other information The other information comprises the information included in the annual report set out on pages 1 to 90, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in this report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of the other information, we are required to report that fact. We have nothing to report in this regard.

98 UBM Annual Report and Accounts 2017 In this context, we also have nothing to report in regard to our responsibility to specifically address the following items in the other Strategic report information and to report as uncorrected material misstatements of the other information where we conclude that those items meet the following conditions: • Fair, balanced and understandable set out on page 61 – the statement given by the directors that they consider the annual report and financial statements taken as a whole is fair, balanced and understandable and provides the information necessary for shareholders to assess the group’s performance, business model and strategy, is materially inconsistent with our knowledge obtained in the audit; or

• Audit committee reporting set out on page 65 – the section describing the work of the audit committee does not Governance appropriately address matters communicated by us to the audit committee; or • Directors’ statement of compliance with the UK Corporate Governance Code set out on page 51 – the parts of the directors’ statement required under the Listing Rules relating to the company’s compliance with the UK Corporate Governance Code containing provisions specified for review by the auditor in accordance with Listing Rule 9.8.10R(2) do not properly disclose a departure from a relevant provision of the UK Corporate Governance Code. Matters on which we are required to report by exception Financial statements We have nothing to report in respect of the following matters in relation to which the Companies (Jersey) Law 1991 requires us to report to you if, in our opinion: −− proper accounting records have not been kept by the company, or proper returns adequate for our audit have not been received from branches not visited by us; or −− the financial statements are not in agreement with the company’s accounting records and returns; or −− we have not received all the information and explanations we require for our audit. Opinions on other matters, as agreed in our Engagement Letter In our opinion, based on the work undertaken in the course of the audit: −− the part of the directors’ remuneration report to be audited has been properly prepared with the basis of preparation described therein. −− the information given in the strategic report and the directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and −− the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements. Matters on which we report by exception as agreed in our Engagement Letter In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report. Responsibilities of directors As explained more fully in the directors’ responsibilities statement set out on page 90, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the group and parent company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Kevin Harkin for and on behalf of Ernst & Young LLP London 27 February 2018 1 The maintenance and integrity of the UBM plc web site is the responsibility of the directors; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the web site. 2 Legislation in Jersey governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. UBM Annual Report and Accounts 2017 99 Consolidated income statement for the year ended 31 December 2017

Before Before exceptional Exceptional exceptional Exceptional items items Total items items Total 2017 2017 2017 2016 2016 2016 Notes £m £m £m £m £m £m Continuing operations 2 Revenue 1,002.9 – 1,002.9 863.0 – 863.0 3.2 Other operating income 9.2 – 9.2 6.9 – 6.9 3.3 Operating expenses (719.9) – (719.9) (637.5) – (637.5) 3.5 Exceptional operating items – (17.1) (17.1) – (45.5) (45.5) 4.2 Amortisation of intangible assets arising on acquisitions (64.5) – (64.5) (45.1) – (45.1) 4.4 Share of post-tax results from joint ventures and associates 1.4 – 1.4 1.9 9.0 10.9 Group operating profit from continuing operations 229.1 (17.1) 212.0 189.2 (36.5) 152.7

5.4 Financing income 2.7 5.1 7.8 3.1 – 3.1 5.4 Financing expense (28.1) – (28.1) (28.6) (7.1) (35.7) 5.4 Net financing expense (25.4) 5.1 (20.3) (25.5) (7.1) (32.6)

Profit before tax from continuing operations 203.7 (12.0) 191.7 163.7 (43.6) 120.1

3.6 Tax (23.4) (16.6) (40.0) (8.6) (14.2) (22.8) Profit for the year from continuing operations 180.3 (28.6) 151.7 155.1 (57.8) 97.3

Discontinued operations 6.4 Profit for the year from discontinued operations – 7.8 7.8 26.3 380.9 407.2 Profit for the year 180.3 (20.8) 159.5 181.4 323.1 504.5

Attributable to: Owners of the parent entity 146.0 491.5 Non-controlling interests 13.5 13.0 159.5 504.5

Earnings per share pence pence 3.7 Continuing operations – basic 35.1 20.3 3.7 Continuing operations – diluted 34.8 20.1 3.7 Profit for the year – basic 37.1 118.5 3.7 Profit for the year – diluted 36.8 117.3

£m £m Group operating profit from continuing operations 212.0 152.7 3.5 Exceptional operating items 17.1 36.5 4.2 Amortisation of intangible assets arising on acquisitions 64.5 45.1 Share of tax on profit in joint ventures and associates 0.6 0.5 2 Continuing adjusted operating profit* 294.2 234.8 6.4 Discontinued adjusted operating profit* – 28.1 2 Group adjusted operating profit* 294.2 262.9

£m £m Dividends 5.8 Interim dividend of 5.5p (2016: 5.4p) 21.6 21.2 5.8 Special dividend of £nil (2016: 55.3p) – 243.7 5.8 Proposed final dividend of 18.0p (2016: 16.6p) 70.9 65.3 * Adjusted Group operating profit represents Group operating profit excluding amortisation of intangible assets arising on acquisitions, exceptional items and share of tax on profit in joint ventures and associates.

100 UBM Annual Report and Accounts 2017 Consolidated statement of comprehensive income for the year ended 31 December 2017

2017 2016 Strategic report Notes £m £m Profit for the year 159.5 504.5

Other comprehensive income

Other comprehensive income to be reclassified to profit or loss in subsequent periods

5.8 Currency translation differences on foreign operations – Group (145.9) 203.9 Governance 5.8 Net investment hedge 56.8 (39.0) 5.8 Available-for-sale investment 13.6 1.7 5.8 Reclassification adjustment for foreign operations – 32.6 3.6 Income tax relating to components of other comprehensive income – – (75.5) 199.2 4.4 Currency translation differences on foreign operations – joint ventures and associates – (0.3) (75.5) 198.9 Financial statements

Other comprehensive income not to be reclassified to profit or loss in subsequent periods 7.2 Remeasurement of defined benefit obligation 39.2 (43.9) 7.2 Irrecoverable element of pension surplus 0.2 (0.1) 3.6 Income tax relating to components of other comprehensive income – – 39.4 (44.0) 4.4 Remeasurement of defined benefit obligation of associates (0.6) (0.9) 38.8 (44.9)

Other comprehensive (loss)/income for the year, net of tax (36.7) 154.0

Total comprehensive income for the year net of tax 122.8 658.5

Attributable to: Owners of the parent entity 113.5 639.1 Non-controlling interests 9.3 19.4 122.8 658.5

UBM Annual Report and Accounts 2017 101 Consolidated statement of financial position at 31 December 2017

Restated 31 December 31 December 2017 2016 Notes £m £m Assets Non-current assets 4.1 Goodwill 1,533.0 1,623.6 4.2 Intangible assets 498.4 578.8 4.3 Property, plant and equipment 39.9 40.6 4.4 Investments in joint ventures and associates 17.3 16.5 5.6 Available-for-sale investments 38.1 26.8 4.5.1 Trade and other receivables 3.2 1.7 5.5 Derivative financial instruments 3.2 5.4 7.2 Retirement benefit surplus 4.8 4.9 3.6 Deferred tax asset 19.7 26.8 2,157.6 2,325.1 Current assets 4.5.1 Trade and other receivables 216.7 228.9 5.2 Cash and cash equivalents 77.7 84.8 5.5 Derivative financial instruments – 0.2 294.4 313.9 Total assets 2,452.0 2,639.0 Liabilities Current liabilities 3.6 Current tax liabilities 52.6 60.9 4.5.2 Trade and other payables 483.5 521.9 4.6 Provisions 9.9 21.4 5.3 Borrowings 3.6 0.5 5.5 Derivative financial instruments 2.8 3.1 552.4 607.8 Non-current liabilities 3.6 Deferred tax liabilities 29.5 33.3 4.5.2 Trade and other payables 7.5 9.2 4.6 Provisions 9.6 8.5 5.3 Borrowings 588.3 686.5 5.5 Derivative financial instruments 4.8 12.7 7.2 Retirement benefit obligation 10.6 55.5 650.3 805.7 Total liabilities 1,202.7 1,413.5 Equity attributable to owners of the parent entity 5.8 Share capital 44.3 44.3 5.8 Share premium 536.0 535.3 5.8 Other reserves (481.4) (410.9) Retained earnings 1,124.3 1,029.5 Put options over non-controlling interests (6.6) (7.8) Total equity attributable to owners of the parent entity 1,216.6 1,190.4 Non-controlling interests 32.7 35.1 Total equity 1,249.3 1,225.5 Total equity and liabilities 2,452.0 2,639.0 These financial statements were approved by the Board of Directors and were signed on its behalf on 27 February 2018 by:

Marina Wyatt Director

102 UBM Annual Report and Accounts 2017 Consolidated statement of changes in equity for the year ended 31 December 2017

Total equity Strategic report Put options attributable over non- to owners Non- Total Share Share Other Retained controlling of parent controlling equity capital premium reserves earnings interests entity interests £m Notes £m £m £m £m £m £m £m At 1 January 2017 44.3 535.3 (410.9) 1,029.5 (7.8) 1,190.4 35.1 1,225.5 Profit for the year – – – 146.0 – 146.0 13.5 159.5 Other comprehensive (loss)/income – – (71.3) 38.8 – (32.5) (4.2) (36.7)

Total comprehensive income for the year – – (71.3) 184.8 – 113.5 9.3 122.8 Governance 5.8 Equity dividends – – – (86.9) – (86.9) – (86.9) Non-controlling interest dividends – – – – – – (11.0) (11.0) 6.2 Acquisition of non-controlling interests – – – (0.5) 1.2 0.7 (0.7) – 5.8 Issued in respect of share option schemes and other entitlements – 0.7 – – – 0.7 – 0.7 7.3 Share-based payments – – – 5.4 – 5.4 – 5.4

5.8 Shares awarded by ESOP – – 14.7 (14.7) – – – – Financial statements 5.8 Own shares purchased by the Company – – (13.9) 6.7 – (7.2) – (7.2) At 31 December 2017 44.3 536.0 (481.4) 1,124.3 (6.6) 1,216.6 32.7 1,249.3

At 1 January 2016 44.3 534.7 (605.3) 927.6 (17.5) 883.8 30.3 914.1 Profit for the year – – – 491.5 – 491.5 13.0 504.5 Other comprehensive income/(loss) – – 192.5 (44.9) – 147.6 6.4 154.0 Total comprehensive income for the year – – 192.5 446.6 – 639.1 19.4 658.5 5.8 Equity dividends – – – (336.7) – (336.7) – (336.7) Non-controlling interest dividends – – – – – – (12.2) (12.2) 6.1 Non-controlling interest arising on business combinations – – – – – – 1.5 1.5 6.2 Acquisition of non-controlling interests – – – (5.8) 9.7 3.9 (3.9) – 5.8 Issued in respect of share option schemes and other entitlements – 0.6 – – – 0.6 – 0.6 7.3 Share-based payments – – – 6.1 – 6.1 – 6.1 5.8 Shares awarded by ESOP – – 26.3 (26.3) – – – – 5.8 Own shares purchased by the Company – – (24.4) 18.0 – (6.4) – (6.4) At 31 December 2016 44.3 535.3 (410.9) 1,029.5 (7.8) 1,190.4 35.1 1,225.5

UBM Annual Report and Accounts 2017 103 Consolidated statement of cash flows for the year ended 31 December 2017

2017 2016 Notes £m £m Cash flows from operating activities Profit for the year from continuing operations 151.7 97.3 6.4 Profit for the year from discontinued operations 7.8 407.2 Profit for the year 159.5 504.5 Add back: Exceptional operating items from continuing operations (excluding fair value adjustments below) 18.2 36.1 5.6 Fair value adjustments to contingent consideration (1.1) 0.4 6.4 Exceptional items relating to discontinued operations (7.8) (382.0) 3.6 Tax 40.0 25.7 4.2 Amortisation of acquired intangible assets 64.5 45.1 4.2 Amortisation of website development costs and internally generated software 8.7 9.5 4.3 Depreciation 8.7 8.0 4.4 Share of post tax results from joint ventures and associates (1.4) (2.1) 5.4 Net financing expense 20.3 32.6 Other non-cash items 1.1 – 310.7 277.8 4.6 Payments against provisions (5.4) (11.9) Pension deficit contributions (3.3) (13.3) (Increase)/decrease in trade and other receivables (1.1) 32.1 Decrease in trade and other payables (18.3) (89.9) Cash generated from operations 282.6 194.8 Interest and finance income received 1.8 1.8 Interest and finance costs paid (25.6) (27.0) 3.6 Tax paid (42.2) (39.1) 4.4 Dividends received from joint ventures and associates – 0.5 Net cash flows from operating activities 216.6 131.0 Net cash flows from operating activities – continuing 216.6 110.1 Net cash flows from operating activities – discontinued – 20.9 Cash flows from investing activities 4.3 Purchase of property, plant and equipment (9.8) (5.4) 4.2 Expenditure on intangible assets (11.1) (6.3) 6.1 Acquisition of interests in subsidiaries, net of cash acquired (62.6) (416.2) 6.3 Proceeds from sale of investments, joint ventures and associates – 17.0 Proceeds from repayment of vendor loan note – 8.7 6.3 Proceeds from sale of businesses, net of cash disposed 3.3 545.8 Net cash flows from investing activities (80.2) 143.6 Net cash flows from investing activities – continuing (80.2) 147.5 Net cash flows from investing activities – discontinued – (3.9) Cash flows from financing activities 5.8 Proceeds from issuance of ordinary share capital 0.7 0.6 6.2 Acquisition of non-controlling interests (2.2) (5.8) 5.8 Dividends paid to shareholders (86.9) (336.7) Dividends paid to non-controlling interests (11.0) (12.2) 5.8 Investment in own shares – ESOP (7.2) (6.4) 5.1 Proceeds from borrowings 283.5 324.7 5.1 Repayment of borrowings (323.3) (250.0) Net cash flows from financing activities (146.4) (285.8) Net cash flows from financing activities – continuing (146.4) (258.9) Net cash flows from financing activities – discontinued – (26.9) Net decrease in cash and cash equivalents (10.0) (11.2) Net foreign exchange difference (0.2) 12.6 Cash and cash equivalents including overdrafts at 1 January 84.3 82.9 Cash and cash equivalents including overdrafts at 31 December 74.1 84.3

104 UBM Annual Report and Accounts 2017 Section 1: Basis of preparation Strategic report This section provides general information about the Group and the accounting policies that apply to the consolidated financial statements as a whole. Accounting policies that are specific to a particular note are provided within the note to which it relates. This section also details the new or amended accounting standards adopted during the year as well as the anticipated impact of future changes to accounting standards that are not yet effective.

UBM plc is a public limited company incorporated in Jersey under the Companies (Jersey) Law 1991. The registered office is Ogier House, The Esplanade, St. Helier, JE4 9WG, Jersey. UBM plc is tax resident in the United Kingdom. The principal activities of the Group are described in Section 2. Governance The consolidated financial statements for the year ended 31 December 2017 were authorised for issue by the Board of Directors on 27 February 2018. They are prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). The consolidated financial statements comply with the Companies (Jersey) Law 1991 and are prepared under the historical cost basis except for derivative financial instruments and hedged items which are measured at fair value. The consolidated financial statements are presented in pounds sterling, which is the functional currency of the parent company, UBM plc. All amounts are rounded to the nearest £0.1m unless otherwise indicated.

The accounting policies adopted in the preparation of the consolidated financial statements are consistent with those used for the Financial statements previous financial year, except for the adoption of the following new and amended IFRSs. The following new and amended standards have been adopted but they do not impact the consolidated financial statements of the Group: −− Amendments to IAS 12: Recognition of Deferred Tax Asset −− Amendments to IAS 7: Disclosure Initiative −− Amendments to IFRS 10 and IAS 28: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture; and −− Annual Improvements 2014-2016 • IFRS 12: Disclosure of interests in other entities; • IFRS 1: First-time adoption of IFRS • IAS 28: Investments in associates and joint ventures Discontinued operations The disposed PR Newswire business was a discontinued operation during 2016. In the year ended 31 December 2017, the Group has recognised an additional £7.8m gain on disposal of PR Newswire primarily due to the release of warranties and indemnities which were originally recognised in accordance with specific clauses in the sale agreement. This gain has been recognised as an exceptional item for discontinued operations in the year ended 31 December 2017. The gain has a 2.0 pence impact on basic and diluted earnings per share and no cash flow effect. Comparative information The comparative information in the consolidated statement of financial position for the year ended 31 December 2016 has been restated for acquisition accounting adjustments in relation to the Allworld Exhibitions acquisition in accordance with IFRS 3 ‘Business Combinations’ (2008). The impact of the restatement of the 31 December 2016 values is to increase intangible assets, property plant and equipment, provisions and deferred tax liability by £23.0m, £0.2m, £0.5m and £2.4m respectively with a corresponding decrease in goodwill, trade and other receivables, deferred tax asset, trade and other payables and current tax liability of £20.9m, £0.8m, £0.4m, £0.8m and £1.0m respectively. Refer to Note 6.1 for further details. Going concern After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future (see page 45 of the Operating and Financial Review). The consolidated financial statements are therefore prepared on a going concern basis. Basis of consolidation The consolidated financial statements comprise those of UBM plc (the Company) and its subsidiaries (together referred to as the Group) and include the Group’s interests in joint ventures and associates. Subsidiaries Subsidiaries are entities that are directly or indirectly controlled by the Group. The Group controls an entity when it has the rights to variable returns and has the ability to affect those returns through power over the entity. Subsidiaries are consolidated from the date on which the Group obtains control and continue to be consolidated until the date when such control ceases. The financial statements of material subsidiaries are prepared for the same reporting period as the Company, using consistent accounting policies. All intra-group balances and transactions are eliminated in full.

UBM Annual Report and Accounts 2017 105 Section 1: Basis of preparation continued

Joint ventures and associates Joint ventures are joint arrangements in which the Group has the rights to the net assets through joint control with a third party. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control. Associates are entities in which the Group has significant influence through the power to participate in the financial and operating policy decisions of the investee and which are neither subsidiaries nor joint ventures. The Group accounts for its interests in joint ventures and associates using the equity method. Under the equity method, the investment in the joint venture or associate is initially measured at cost. The carrying amount of the investment is adjusted to recognise changes in the Group’s share of net assets of the entity since the acquisition date. Goodwill relating to the entity is included in the carrying amount of the investment and is neither amortised nor individually tested for impairment. The income statement reflects the Group’s share of the results of operations of the entity. The statement of comprehensive income includes the Group’s share of any other comprehensive income recognised by the joint venture or associate. All unrealised gains and losses resulting from transactions with joint ventures and associates are eliminated in full. These investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. Dividend income is recognised when the right to receive the payment is established. Foreign currencies Transactions in foreign currencies are initially recorded by Group entities in their respective functional currency using the spot rate at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rate of exchange prevailing at the reporting date. Differences arising on the settlement or translation of monetary items are recognised in profit or loss. On consolidation, the assets and liabilities of foreign operations are translated into sterling at the rate of exchange prevailing at the reporting date. Income and expenses are translated at the average exchange rate prevailing in the month in which the transactions occurred. The exchange differences arising on translation for consolidation are recognised in other comprehensive income and are shown as a separate component of equity, which was reset to zero on first time adoption of IFRS. Exchange differences arising on the settlement or translation of monetary items designated as a hedge of the Group’s net investment in a foreign operation are also recognised in other comprehensive income. On disposal of a foreign operation, the accumulated amount of other comprehensive income held in a separate component of equity relating to that foreign operation is reclassified from other comprehensive income to profit or loss, along with the cumulative amount of exchange recognised in relation to hedging instruments. Significant accounting judgements and estimates The preparation of the Group’s consolidated financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of expenses, assets and liabilities and the accompanying disclosures. Uncertainty about the assumptions and estimates could result in outcomes which differ from the estimates. The judgements made in the process of applying the Group’s accounting policies that have the most significant effect on amounts recognised in the financial statements relate to: −− Unrecognised deferred tax assets (Note 3.6) −− The identification of cash generating units and assumptions used in the impairment testing of goodwill (Note 4.1) −− The measurement of retirement benefit obligations (Note 7.2) −− The identification of intangible assets acquired in business combinations (Note 6.1) The key areas of estimation uncertainty at the reporting date that could have a material effect on the carrying amounts of assets and liabilities within the next financial year relate to: −− Current tax liabilities (Note 3.6) −− Forecast cash flows used in annual impairment testing of goodwill (Note 4.1) −− Provisions, including warranty provisions (Note 4.6)

106 UBM Annual Report and Accounts 2017 New and amended IFRSs issued by the IASB but not yet effective for the year ended 31 December 2017 Strategic report The following new and amended IFRSs may have an impact on the Group’s consolidated financial statements:

Accounting standard Requirements Impact on financial statements IFRS 9 ‘Financial Financial assets will be measured at amortised The Group has performed an assessment of the Instruments’ cost or fair value. Liabilities will be measured impact of this standard. Following adoption of the in accordance with the existing requirements standard, increased disclosures on hedging will be of IAS 39, but the portion of the change in required, otherwise implementation will not have a fair value of a liability arising from changes in material impact. Governance the entity’s own credit risk will be presented in other comprehensive income, rather than in the income statement. Effective for annual periods beginning on or after 1 January 2018.

IFRS 15 ‘Revenue IFRS 15 applies to all contracts with customers The Group has performed an assessment of the Recognition’ excluding those covered by other IFRSs such impact of this standard. Adoption of the standard Financial statements and IFRS 15 as lease contracts, insurance contracts, and will not have a material impact on the statement (amendment) financial instruments. of comprehensive income. The impact on the net Core principle of the standard: assets in the statement of financial position will not be material but will include a reclassification Recognise revenue to depict the transfer of between deferred revenue and trade receivables. goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Effective for annual periods beginning on or after 1 January 2018.

Amendments to The amendment addresses three main areas: the The Group has performed an assessment of this IFRS 2 effects of vesting conditions on the measurement standard. The Group do not have significant share ‘Share Based of a cash-settled share-based payment based payment transactions which would be Payments’ transaction; the classification of a share-based impacted by the amendments therefore adoption payment transaction with net settlement features will not have a material impact. for withholding tax obligations; and accounting where a modification to the terms and conditions of a share-based payment transaction changes its classification from cash settled to equity settled. Effective for annual periods beginning on or after 1 January 2018.

IFRS 16 ‘Leases’ IFRS 16 specifies how an IFRS reporter will The Group is currently performing an assessment recognise, measure, present and disclose leases. of this standard. It is expected to have a material The standard provides a single lessee accounting impact on the statement of financial position as model, requiring lessees to recognise assets and it will result in the Group recognising assets and liabilities for all leases unless the lease term is lease liabilities. The asset will be depreciated, and 12 months or less or the underlying asset has a interest charged on the lease liabilities, which low value. Lessors continue to classify leases as replaces the rental cost previously recognised in operating or finance, with IFRS 16’s approach to the income statement. This may initially result in lessor accounting substantially unchanged from the Group recognising a higher lease expense than its predecessor, IAS 17. operating rental cost. It is not expected to have a Effective for annual periods beginning on or after material impact on the income statement but the 1 January 2019. exact value will depend on the leases held in the future. The current level of operating leases held by the Group is disclosed in Note 3.4.

The following new and amended standards will be adopted by the Group from 1 January 2018 and will not impact the consolidated financial statements of the Group: −− Amendments to IFRS 1: First time adoption of IFRS regarding IFRS 7, IAS 19 and IFRS 10 −− Amendments to IAS 28: Investment in associates and joint ventures −− IFRIC 22: Foreign currency transactions and advance consideration

UBM Annual Report and Accounts 2017 107 Section 2: Segment information

Operating segments The Group considers that operating segments presented on a products and services basis are the most appropriate way to demonstrate the performance of the Group. This is consistent with the internal reporting provided to the Group Chief Executive Officer and the Group Chief Financial Officer, together the chief operating decision maker (CODM), and reflects the way in which resources are allocated. The CODM considers there to be two operating segments: −− Events which provide face-to-face interaction in the form of exhibitions, tradeshows, conferences and other live events; and −− Other Marketing Services which publish magazines and trade press to specialist markets either online or in print; as well as providing sponsorships and banner advertising and online directory and data products; The PR Newswire businesses which were disposed in June 2016 comprised the previously reported PR Newswire operating segment and have been reported as discontinued operations as at 31 December 2016. Segment measures The CODM assesses the performance of the operating segments and the allocation of resources using revenue and adjusted operating profit. Adjusted operating profit is IFRS operating profit excluding amortisation of intangible assets arising on acquisitions, exceptional items and share of tax on results of joint ventures and associates. Finance income/expense and tax are not allocated to operating segments and are reported to the CODM only in aggregate. Segment assets and liabilities are not reported to the CODM. Transactions between segments are measured on the basis of prices that would apply to third-party transactions. Year ended 31 December 2017

Other Marketing Corporate Events Services Costs Total £m £m £m £m Revenue Total segment revenue 866.4 136.5 – 1,002.9 Intersegment revenue – – – – External revenue 866.4 136.5 – 1,002.9

Result Depreciation and amortisation of website development costs and internally generated software (14.7) (2.3) (0.4) (17.4) Share of pre-tax results from joint ventures and associates 0.7 – 1.3 2.0 Segment adjusted operating profit 295.6 19.4 (20.8) 294.2 Amortisation of intangible assets arising on acquisitions (64.5) Exceptional operating items – continuing (17.1) Share of tax on profit in joint ventures and associates (0.6) Group operating profit 212.0 Net financing expense (25.4) Exceptional items relating to net financing expense 5.1 Profit before tax from continuing operations 191.7 Tax (40.0) Exceptional operating items – discontinued 7.8 Profit for the year 159.5 Within Corporate Costs, non-recurring credits amount to £4.3m relating to pension credits (2016: £5.7m one-off credits in relation to the pension credits of £5.0m and £0.7m income from a disposed associate).

108 UBM Annual Report and Accounts 2017 Operating segments continued Strategic report Year ended 31 December 2016

Other PR Newswire Marketing Corporate Continuing discontinued Events Services Costs total operations Total £m £m £m £m £m £m Revenue Total segment revenue 712.6 151.4 – 864.0 103.2 967.2 Intersegment revenue (1.0) – – (1.0) (0.2) (1.2) Governance External revenue 711.6 151.4 – 863.0 103.0 966.0

Result Depreciation and amortisation of website development costs and internally generated software (13.9) (2.9) (0.7) (17.5) – (17.5) Share of pre-tax results from joint ventures and associates 0.2 – 2.2 2.4 0.2 2.6

Segment adjusted operating profit 229.1 24.1 (18.4) 234.8 28.1 262.9 Financial statements Amortisation of intangible assets arising on acquisitions (45.1) – (45.1) Exceptional operating items (36.5) 382.0 345.5 Share of tax on profit in joint ventures and associates (0.5) – (0.5) Group operating profit 152.7 410.1 562.8 Net financing expense (25.5) – (25.5) Exceptional items relating to net financing expense (7.1) – (7.1) Profit before tax 120.1 410.1 530.2 Exceptional tax items (14.2) (1.1) (15.3) Tax (8.6) (1.8) (10.4) Profit for the year 97.3 407.2 504.5 Geographic information Revenue is allocated to countries based on the location where the products and services are provided. Non-current assets are allocated to countries based on the location of the businesses to which the assets relate.

2017 2016 Continuing revenue £m £m United Kingdom 61.4 69.0 Foreign countries United States and Canada 419.1 404.7 Continental Europe 89.1 66.6 China (including Hong Kong) 257.5 218.6 Emerging Markets1 151.1 83.6 Rest of the world 24.7 20.5 941.5 794.0 External revenue 1,002.9 863.0 1 Emerging Markets comprise the non-G10 countries – most notably for the Group: Brazil, India, Indonesia, Malaysia, Mexico, Singapore, Thailand and Turkey. There are no revenues derived from a single external customer which are significant.

Restated 2017 2016 Non-current assets £m £m United Kingdom 333.5 300.5 Foreign countries United States and Canada 1,289.6 1,470.7 Continental Europe 13.0 12.5 China (including Hong Kong) 127.2 115.4 Emerging Markets1 320.2 382.3 Rest of the world 43.2 4.9 1,793.2 1,985.8 Total non-current assets 2,126.7 2,286.3 Non-current assets for this purpose consist of goodwill, intangible assets, property, plant and equipment, investments in joint ventures and associates and available-for-sale investments. The following non-current assets are not included: deferred tax assets, pension benefit surplus, derivative financial instruments and non-current trade and other receivables.

UBM Annual Report and Accounts 2017 109 Section 3: Operating profit and tax

Section 3 contains financial statement notes that relate to the results and performance of the Group during the year, along with the related accounting policies which have been applied. 3.1 Revenue Accounting policy Revenue is measured at the fair value of the consideration received or receivable for the sale of goods and services, net of trade discounts, VAT and other sales related taxes. Events: Revenue from exhibitions, tradeshows, conferences and other live events is recognised on completion of the event. Advance deposits from exhibitors and other participants are recognised as deferred revenue in the statement of financial position until completion of the event. Other Marketing Services: Advertising revenue from website sponsorships, banner advertising and online directories is recognised straight line over the life of the services for online products and on publication of the advertisement for print products. For single/ discrete services, revenue is recognised at the point of delivery. Revenue from subscriptions to online services, magazines and trade press is recognised straight line over the life of the subscription. 3.2 Other operating income

2017 2016 Continuing £m £m Rental income 2.5 2.5 Other income and subsidies 6.7 4.4 9.2 6.9 3.3 Operating expenses Operating expenses (with the exception of employee costs) directly relating to the production of exhibitions, tradeshows, conferences and other live events are recognised on completion of the event in line with revenue recognition. These expenses are treated as prepayments in the statement of financial position until recognition in the income statement. Included in continuing operating expenses:

2017 2016 £m £m Employee costs (Note 7.1) 250.7 232.9 Amortisation of website development costs and internally generated or purchased software (Note 4.2) 8.7 9.5 Depreciation (Note 4.3) 8.7 8.0 Cost of inventories recognised as expense 2.3 2.6 Auditor’s remuneration 2.0 2.0 Minimum lease payments recognised as an operating lease expense 15.2 15.6

2017 2016 £m £m Fees payable to the Company’s auditor for the audit of the Company’s annual accounts 0.9 0.8 Fees payable to the Company’s auditor and its associates for other services: Audit of the Company’s subsidiaries pursuant to legislation 0.9 0.9 Audit related assurance services 0.2 0.1 Other assurance services – 0.1 Tax services – compliance – 0.1 Total auditor’s remuneration 2.0 2.0 Details of the Group policy on non-audit work undertaken by the Group’s auditor are set out in the Audit Committee Report on page 67.

110 UBM Annual Report and Accounts 2017 3.4 Operating leases Strategic report Group as lessee Accounting policy Operating lease payments are recognised as an expense in the income statement on a straight line basis over the lease term. Minimum lease payments Operating leases have varying terms, incentives, escalation clauses and renewal rights. The future minimum lease payments payable under non-cancellable operating leases are as follows: Governance

Land and Land and buildings Other buildings Other 2017 2017 2016 2016 £m £m £m £m Within 1 year 16.3 0.1 13.5 0.4 Later than 1 year and not later than 5 years 46.1 0.2 42.4 0.1 Later than 5 years 38.2 – 43.5 – 100.6 0.3 99.4 0.5 Financial statements Group as lessor Accounting policy Rental income arising from operating leases is recognised on a straight line basis over the lease term. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income. Minimum lease receipts The Group has entered into commercial property leases under non-cancellable operating lease agreements. The leases have remaining terms of between three and twelve years, with varying incentives, escalation clauses and renewal rights. The future minimum lease receipts under non-cancellable operating leases are as follows:

2017 2016 £m £m Within 1 year 2.0 2.2 Later than 1 year and not later than 5 years 5.5 6.5 Later than 5 years 5.2 6.2 12.7 14.9 3.5 Exceptional operating items Certain items are recognised as exceptional items since, due to their nature or infrequency, such presentation is relevant to an understanding of the Group’s financial statements. These items are not part of the Group’s normal ongoing operations and are excluded from the Group’s adjusted operating profit measure. They typically relate to costs associated with acquisitions, gains or losses on disposal of investments, material restructuring costs and impairments. Exceptional items are considered individually and assessed each reporting period.

2017 2016 (Charged)/credited to continuing operating profit £m £m Advanstar integration costs (8.0) (8.1) Business Journals Inc integration costs (3.1) (3.2) Allworld integration costs (5.1) – Acquisition costs on Allworld Exhibitions (1.9) (4.7) Acquisition costs on other business combinations (0.3) (2.0) Changes in estimates of contingent consideration (Note 5.6) 1.1 (0.4) Exceptional items relating to acquisitions (17.3) (18.4)

Gain on disposal of investment and associate (Note 6.3) – 11.2 Loss on disposal of Ecobuild (Note 6.3) – (35.1) Gain on disposal of non-core businesses (Note 6.3) 2.6 9.2 Exceptional items relating to disposal of investments 2.6 (14.7)

Impairment of goodwill and intangible assets (Note 4.1 and Note 4.2) – (3.4) Impairment charge – (3.4)

Transaction costs (2.4) – Total charged to continuing operating profit (17.1) (36.5) Total cash paid for exceptional expenses during the year amounted to £18.0m. UBM Annual Report and Accounts 2017 111 Section 3: Operating profit and tax continued

3.5 Exceptional operating items continued Advanstar and Business Journals Inc (BJI) integration costs The integration costs incurred in 2017 related to operational and financial integration into the Americas business, alignment and migration of processes and termination of venue contracts. The transitions are complete and both Advanstar and BJI are integrated into the Americas division and no further costs are expected. Allworld integration costs Integration costs of £5.1m have been incurred in 2017 and primarily relate to restructuring costs and consultancy fees in preparation and execution of the operational and finance integrations. Total integration costs of $20m are expected to be incurred over the next two years. Acquisition costs Total acquisition costs of £2.2m have been expensed as exceptional items and relate mainly to due diligence and professional fees paid to various advisors. Of these, £1.9m relate to the acquisition of Allworld Exhibitions, and £0.3m relate to fees incurred for the acquisitions of Marmara, AMA Research, Green Thinking Services and The Aesthetic Show (Note 6.1). Gain on disposal of business Following the disposal of the Customer Tech and Care show businesses, the Group recognised a gain on disposal of £2.6m. Transaction costs The transaction costs were incurred in relation to the offer made by Informa Plc for the Group. Further costs are expected to be incurred during 2018. There is no tax recognised in respect of the exceptional items reported above. 3.6 Tax This note details the accounting policies applied for tax, the current and deferred tax charges or credits in the year, a reconciliation of total tax expense to the accounting profit and the movements in deferred tax assets and liabilities. Accounting policy Current tax for the current and prior periods is recognised, to the extent unpaid, as a liability at the amount expected to be paid to the taxation authorities. The tax liabilities are measured using tax rates enacted or substantively enacted at the balance sheet date. Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. Deferred tax is provided on temporary differences arising on investments in subsidiaries, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. However, deferred tax is not recognised on temporary differences arising from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred tax is measured using tax rates enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary difference can be utilised. Current tax expense and deferred tax expense are recognised in the income statement except to the extent they arise from a transaction or event recognised in other comprehensive income or directly in equity. Any such tax expense is recognised in other comprehensive income or in equity respectively. The Group is a multi-national group with tax liabilities arising in many geographical locations. This inherently leads to complexity in the Group’s tax structure. Therefore the calculation of the Group’s current tax liabilities and tax expense necessarily involves a degree of estimation and judgement in respect of items whose tax treatment cannot be finally determined until resolution has been reached with the relevant tax authority or, as appropriate, through a formal legal process. The resolution of issues is not always within the control of the Group and issues can, and often do, take many years to resolve. The tax liabilities recognised in the financial statements are measured at the Directors’ estimate of tax that may become payable. Payments in respect of tax liabilities for an accounting period result from payments on account and on the final resolution of open items. As a result, there can be substantial differences between the tax charge in the income statement and tax payments. The final resolution of certain of these items may give rise to material profit and loss and/or cash flow variances. Any difference between expectations and the actual future liability will be accounted for in the period identified. Income statement 2017 2016 Continuing £m £m Current tax expense 36.7 31.0 Exceptional tax charge 16.6 14.2 Other deferred tax credit (13.3) (22.4) Income tax expense 40.0 22.8 The exceptional tax charge of £16.6m relates to the unwind of the deferred tax asset recognised in 2014 as an exceptional tax credit. 112 UBM Annual Report and Accounts 2017 3.6 Tax continued Strategic report Reconciliation of total tax expense to the accounting profit: 2017 2016 £m £m Profit before tax from continuing operations 191.7 120.1 Profit before tax from discontinued operations (Note 6.4) 7.8 410.1 Profit before tax 199.5 530.2 Governance Profit before tax multiplied by UK rate of corporation tax of 19.25% (2016: 20.0%) 38.4 106.0

Effect of: Different tax rates on overseas earnings 18.6 15.2 Non-taxable gain on disposal of discontinued operations (1.5) (74.2) Expenses not deductible for tax purposes 3.0 19.1 Non-taxable income (5.1) (9.7) Financial statements Net movement in uncertain tax positions (7.3) (4.9) Prior year adjustments (1.4) 2.1 Benefit of intragroup financing (18.2) (17.8) Exceptional deferred tax charge 16.6 13.1 Movement in deferred tax assets recognised as a consequence of acquisition intangibles (0.3) (6.7) Movement in other deferred tax assets recognised (4.7) (4.6) Losses brought forward and utilised (2.8) (6.1) Surplus losses carried forward 8.9 12.5 Deduction for amortisation (19.6) (18.8) Effects of other unrecognised temporary differences 6.4 (3.3) Share of results from associates and joint ventures (after tax) (0.3) (0.4) Effect of changes in tax rates 8.5 – Other 0.8 4.2 Total tax expense 40.0 25.7 Tax expense reported in the consolidated income statement 40.0 22.8 Tax attributable to discontinued operations (Note 6.4) – 2.9 40.0 25.7 The amount of £8.5m in relation to the effect of changes in tax rates is due to the impact on deferred tax of the reduction in the US Federal tax rate from 35% to 21% as part of the Tax Cuts and Jobs Act 2017. Reconciliation to continuing adjusted tax charge 2017 2016 £m £m Income tax expense 40.0 25.7 Exceptional tax charge (16.6) (14.2) Net deferred tax movement on acquisition intangibles 19.0 20.1 Share of tax on profit in joint ventures and associates 0.6 0.5 Tax attributable to discontinued operations – (2.9) Continuing adjusted tax charge (Note 3.7) 43.0 29.2 Other comprehensive income No current or deferred tax relates to items reported in other comprehensive income (2016: nil). Statement of financial position: current tax Restated 2017 2016 £m £m Current tax liability at 1 January 60.9 56.4 Current tax expense – continuing 36.7 32.1 Current tax expense – discontinued operations – 1.1 Acquisitions (Note 6.1) – 6.4 Tax paid – continuing (42.2) (36.7) Currency translation and other movements (2.8) 1.6 Current tax liability at 31 December 52.6 60.9 The current tax liability includes £35.9m (2016: £45.6m) in respect of accruals for uncertain tax positions. On 26 October 2017 the European Commission announced that it would be opening a State Aid investigation into the UK’s Controlled Foreign Company regime. The Group is monitoring developments but does not currently consider that any provision is required in relation to this matter. UBM Annual Report and Accounts 2017 113 Section 3: Operating profit and tax continued

3.6 Tax continued During the year, tax has been paid in the following jurisdictions:

2017 £m China (including Hong Kong) 17.0 Europe 12.5 US 0.8 Emerging Markets 8.9 Rest of the world 3.0 Total 42.2 Statement of financial position: deferred tax Consolidated statement of Consolidated income financial position statement Restated 2017 2016 2017 2016 Deferred tax liabilities £m £m £m £m Intangibles 75.4 100.2 (18.8) (0.7) Accelerated capital allowances 1.6 1.8 – 2.6 Tax losses (60.6) (78.8) 12.7 (19.0) Other temporary differences (6.6) (16.7) 9.4 7.8 9.8 6.5 3.3 (9.3) The movement in deferred tax balance during the year is:

Restated 2017 2016 £m £m Net deferred tax liability/(asset) at 1 January 6.5 (10.8) Acquisitions (Note 6.1) 0.3 28.6 Amounts credited/(debited) to net profit – continuing 3.3 (9.3) Disposals (Note 6.3) – (1.1) Currency translation (0.3) (0.9) Net deferred tax liability at 31 December 9.8 6.5

Analysed in the statement of financial position, after offset of balances within countries, as: Deferred tax assets (19.7) (26.8) Deferred tax liabilities 29.5 33.3 9.8 6.5 The deferred tax assets of £19.7m (2016: £26.8m) relate to tax losses and other temporary differences in the US of £17.1m (2016: £18.1m), Luxembourg of £2.0m (2016: £8.4m) and other countries of £0.6m (2016: £0.3m). These have been recognised because the Group expects to generate taxable profits in the future against which these will be used. The Group has the following unused tax losses for which no deferred tax assets have been recognised: −− £329.5m (2016: £321.8m) in UK subsidiaries which are available to offset against future UK corporate tax liabilities; −− £115.7m (2016: £189.2m) in US subsidiaries which are available to offset against future US federal tax liabilities. Of these £115.7m expire between 2019 and 2037 (2016: £173.0m between 2019 and 2036). In addition, there are unrecognised deferred tax assets in respect of US State losses of £15.2m (2016: £18.4m); −− £251.6m (2016: £249.7m) of UK capital losses which are only available for offset against future capital gains; −− £7.5bn (2016: £7.2bn) that have arisen in Luxembourg holding companies as a result of revaluations of those companies’ investments for local GAAP purposes; and −− £20.1m (2016: £7.4m) in respect of companies in other countries. No deferred tax assets have been recognised in respect of any of these amounts as it is uncertain that these losses will be utilised. In addition, the Group has unrecognised deferred tax assets in relation to other deductible temporary differences of £15.8m (£2.3m in relation to the UK, £7.5m in relation to the US, and £6.0m in relation to other countries) (2016: £20.7m (£13.6m, nil and £7.1m respectively)). No deferred tax assets have been recognised in respect these assets as it is uncertain that they will be utilised.

114 UBM Annual Report and Accounts 2017 3.6 Tax continued Strategic report At 31 December 2017, deferred tax liabilities of £4.5m (2016: £3.9m) have been recognised for taxes that would be payable on the unremitted earnings of the Group’s subsidiaries. No other deferred tax liabilities have been recognised as the Group has determined that profits of subsidiaries will not be distributed in the foreseeable future. The temporary differences associated with investments in subsidiaries for which a deferred tax liability has not been recognised amount in aggregate to £5.2bn (2016: £5.0bn).

3.7 Earnings per share Governance Basic earnings per share is calculated by dividing net profit for the year attributable to owners of the parent entity by the weighted average number of ordinary shares outstanding during the year. Adjusted basic earnings per share excludes amortisation of intangible assets arising on acquisitions, movements on deferred tax balances recognised as a consequence of acquisition of intangibles, exceptional items and net financing expense adjustments (detailed in Note 5.4).

Diluted earnings per share is calculated by dividing net profit for the year attributable to owners of the parent entity by the Financial statements weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares. The impact of dilutive securities in 2017 would be to increase weighted average shares by 4.0 million shares (2016: 4.3 million shares). The weighted average number of shares used in the calculation of earnings per share for the year ended 31 December 2016 reflects the share consolidation on 27 June 2016 of eight for every nine shares owned. In accordance with IAS 33, the prior period weighted average number of shares has not been restated as the share consolidation was coupled with the payment of the special dividend (Note 5.8), which had the overall effect of a share repurchase at fair value. The weighted average number of shares excludes ordinary shares held by the Employee Share Ownership Plan (the ESOP). Continuing operations Weighted Weighted average no. Earnings average no. Earnings Earnings of shares per share Earnings of shares per share 2017 2017 2017 2016 2016 2016 £m million pence £m million pence Adjusted operating profit 294.2 234.8 Net interest expense (24.1) (25.7) Pension schemes finance expense (1.3) (0.6) Adjusted profit before tax 268.8 208.5 Adjusted tax (Note 3.6) (43.0) (29.2) Non-controlling interests (13.5) (13.0) Adjusted earnings per share 212.3 393.2 54.0 166.3 414.9 40.1 Adjustments Amortisation of intangible assets arising on acquisitions (64.5) (16.4) (45.1) (10.9) Net deferred tax movements on intangible assets 19.0 4.8 20.1 4.8 Exceptional items (17.1) (4.4) (36.5) (8.8) Exceptional deferred tax charge (16.6) (4.2) (14.2) (3.4) Net financing (expense)/income adjustments 5.1 1.3 (6.3) (1.5) Basic earnings per share 138.2 393.2 35.1 84.3 414.9 20.3 Options – 4.0 (0.3) – 4.3 (0.2) Diluted earnings per share 138.2 397.2 34.8 84.3 419.2 20.1

Adjusted earnings per share (as above) 212.3 393.2 54.0 166.3 414.9 40.1 Options – 4.0 (0.6) – 4.3 (0.4) Diluted adjusted earnings per share 212.3 397.2 53.4 166.3 419.2 39.7

UBM Annual Report and Accounts 2017 115 Section 3: Operating profit and tax continued

3.7 Earnings per share continued Total Group Weighted Weighted average no. Earnings average no. Earnings Earnings of shares per share Earnings of shares per share 2017 2017 2017 2016 2016 2016 £m million pence £m million pence Adjusted operating profit 294.2 262.9 Net interest expense (24.1) (25.7) Pension schemes finance expense (1.3) (0.6) Adjusted profit before tax 268.8 236.6 Adjusted tax (Note 3.6) (43.0) (31.0) Non-controlling interests (13.5) (13.0) Adjusted earnings per share 212.3 393.2 54.0 192.6 414.9 46.4 Adjustments Amortisation of intangible assets arising on acquisitions (64.5) (16.4) (45.1) (10.9) Net deferred tax movements on intangible assets 19.0 4.8 20.1 4.8 Exceptional items (9.3) (2.4) 344.4 83.1 Exceptional deferred tax charge (16.6) (4.2) (14.2) (3.4) Net financing (expense)/income adjustments 5.1 1.3 (6.3) (1.5) Basic earnings per share 146.0 393.2 37.1 491.5 414.9 118.5 Options – 4.0 (0.3) – 4.3 (1.2) Diluted earnings per share 146.0 397.2 36.8 491.5 419.2 117.3

Adjusted earnings per share (as above) 212.3 393.2 54.0 192.6 414.9 46.4 Options – 4.0 (0.6) – 4.3 (0.5) Diluted adjusted earnings per share 212.3 397.2 53.4 192.6 419.2 45.9

116 UBM Annual Report and Accounts 2017 Section 4: Financial position Strategic report Section 4 contains financial statement notes that relate to the financial position of the Group at 31 December 2017, along with the relevant accounting policies. 4.1 Goodwill Accounting policy Goodwill is measured on acquisition as the excess of the aggregate of consideration transferred, the amount of any non-controlling interest in the acquiree and (in the case of business combinations achieved in stages) the acquisition date fair value of any previous equity interest in the acquiree over the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed. Governance If the initial amount of goodwill is negative, the amount is recognised in profit or loss as a gain on a bargain purchase. Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is tested annually for impairment or more frequently if changes in circumstances indicate that the carrying amount of the cash-generating units (CGUs) may be impaired. For the purpose of impairment tests, the goodwill arising from each business combination is allocated to CGUs that are expected to benefit from the combination and which represent the lowest level within the Group at which management monitors goodwill.

The impairment test requires the Group to estimate the recoverable amount of the CGU to which the goodwill relates. Financial statements The recoverable amount is the higher of value in use and fair value less costs to sell. The value in use of a CGU is measured by discounting the estimated future cash flows of the CGU to their present value using a pre-tax discount rate. Fair value less costs to sell is generally measured using an earnings multiple approach using revenue and EBITA multiples obtained from comparable businesses and transactions. Any impairment loss is recognised immediately in the income statement and is not subsequently reversed.

Goodwill is allocated and monitored by management at a CGU level, consisting of the three business units operating across the Group’s operating segments. Not all business units are active in all segments; there are six CGUs at 31 December 2017 (2016: seven CGUs). During the year, Online and Print were merged into one CGU, “Other Marketing Services”. This reflects the lowest level cash flows are monitored at as products are similar with shared revenue characteristics (subscriptions, advertising and directories) and shared cost bases. Following the acquisition of Allworld, a new CGU “UBM Allworld Events” was recognised, however, this will be merged into UBM Asia from 2018 onwards. For reporting purposes, the CGUs have been aggregated into the reportable segments, as shown in the tables below. The CGUs are individually tested for impairment each year. 31 December 2017 Other Marketing Events Services Total £m £m £m Cost At 1 January 2017 1,565.1 137.3 1,702.4 Acquisitions (Note 6.1) 31.5 0.7 32.2 Disposals (Note 6.3) (2.6) – (2.6) Currency translation (116.1) (6.6) (122.7) At 31 December 2017 1,477.9 131.4 1,609.3 Impairment At 1 January 2017 8.5 70.3 78.8 Currency translation (0.7) (1.8) (2.5) At 31 December 2017 7.8 68.5 76.3 Carrying amount At 1 January 2017 1,556.6 67.0 1,623.6 At 31 December 2017 1,470.1 62.9 1,533.0 Within the Events segment, management considers the UBM Americas Events, UBM EMEA Events, UBM Asia Events and UBM Allworld CGUs to be significant. The carrying amount of goodwill attributed to these CGUs at 31 December 2017 was £929.5m, £223.3m, £88.6m and £228.8m respectively. In 2016, UBM Americas Events (£1,007.5m), UBM EMEA Events (£225.5m) and UBM Asia Events (£344.5m) were considered significant.

UBM Annual Report and Accounts 2017 117 Section 4: Financial position continued

4.1 Goodwill continued 31 December 2016 (restated) Other Marketing Events Services Total £m £m £m Cost At 1 January 2016 1,138.6 129.9 1,268.5 Acquisitions (Note 6.1) 280.3 3.1 283.4 Disposals (Note 6.3) (29.7) (8.8) (38.5) Currency translation 175.9 13.1 189.0 At 31 December 2016 1,565.1 137.3 1,702.4 Impairment At 1 January 2016 4.7 68.5 73.2 Charge for the year 3.3 – 3.3 Disposals (Note 6.3) – (1.8) (1.8) Currency translation 0.5 3.6 4.1 At 31 December 2016 8.5 70.3 78.8 Carrying amount At 1 January 2016 1,133.9 61.4 1,195.3 At 31 December 2016 1,556.6 67.0 1,623.6 Impairment tests for goodwill For the years ended 31 December 2017 and 31 December 2016, the carrying amount of each CGU has been compared with its estimated value in use. The following key assumptions were used by management in the value in use calculations:

Pre-tax Perpetuity discount growth rate rate % % Cash flow forecasts Events 2017: 11.7– 13.0 2017: 1.4 – 2.8 – Event revenue is expected to continue to grow with continued 2016: 11.2 – 11.7 2016: 2.4 – 2.7 focus on the Events First strategy and organic growth in major events. Other Marketing Services 2017: 11.0 – 13.3 2017: 0.0 – 3.1 – The continued rebalancing of the product portfolio, away from 2016: 10.1 – 11.2 2016: (2.9) – 3.1 print to digital. – Focus on the management of cost base as revenue growth slows. Forecast cash flows For each CGU, the forecast cash flows for the first three years are based on the most recent financial budgets and forecasts approved by management. The forecast cash flows are based on assumptions that reflect past experience, forward booking indicators, long term trends, industry forecasts and growth rates and management estimates (see above). For each CGU, the forecast cash flows beyond the first three years are based upon the weighted average projected real gross domestic product growth rate in 2020 of each of the territories in which the CGUs operate. Growth rates for each territory have been based on contribution to 2018 budgeted adjusted operating profit (2016: contribution to 2017 adjusted operating profit). The growth rates used in the value in use calculation for OMS range from 0.0% to 3.1%. In 2016 when the Print and Online CGUs were separate, the growth rate range was (2.9%) – 3.1%. The negative growth rate related to Print and reflected the territories and industries in which the CGU operated. Discount rate The discount rate for each CGU is based on a blended model of the current yield on long term government bonds and longer term expected yields, the systemic risk of the specific CGU and taking into account the relative size of the CGU and the specific territories in which it operates. The increased risk of investing in equities is assessed using an equity market risk premium which reflects the increased return required over and above a risk free rate by an investor who is investing in the whole market. The equity market risk premium used is based on studies by independent economists and historical equity market risk premiums. The risk adjustment for the systematic risk, beta, of the CGU reflects the risks specific to the CGU for which the forecast cash flows have not been adjusted. The adjustment to the rate has been determined by management using an average of the betas of comparable companies within respective sectors. Sensitivities Management believes that no reasonably possible change in any of the above key assumptions would cause the carrying amount of any CGU to exceed its recoverable amount. For the year ended 31 December 2016 , the estimated recoverable amount of UBM Americas Print was not significantly higher than its carrying amount.

118 UBM Annual Report and Accounts 2017 4.2 Intangible assets Strategic report Accounting policy Intangible assets acquired separately (including website development costs relating to the application and infrastructure development, graphical design and content development stages incurred with third parties) are measured on initial recognition at cost. Intangible assets acquired in a business combination are recognised in accordance with the accounting policy for acquisitions (Note 6.1) and measured on initial recognition at fair value at the date of acquisition. Governance Internally generated intangible assets, including internally generated software, that do not qualify for recognition as an intangible asset under IAS 38 are recognised as an expense. All research costs are expensed as incurred. At each reporting date, intangible assets are measured at cost or fair value at the date of acquisition less amortisation and any impairment losses. Intangible assets are amortised on a straight line basis over their useful lives as follows: Trademarks/brands 5–25 years Software 5–7 years

Customer contracts and relationships 1–10 years Financial statements Subscription lists 2–5 years Databases 2–10 years Website development costs 3 years Following the completion of the purchase price allocation for Allworld Exhibitions, based on expert external advice which considered the longevity and strength of certain Allworld brands, the useful economic life of certain Allworld brands was estimated to be 25 years. Accordingly, the existing Group policy for brands has been updated from a range of 5 to 15 years, to be 5 to 25 years. Useful lives are re-examined on an annual basis and adjustments, where applicable are made on a prospective basis. The Group does not have any intangible assets with indefinite lives. Intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The amortisation of internally generated or purchased software and website development costs is included in operating expenses in the income statement. The amortisation of intangible assets arising on acquisitions is included as a separate line item in the income statement as it does not relate to operating activities. 31 December 2017 Acquired Acquired Website customer software development Acquired contracts and and and brands relationships databases software Total £m £m £m £m £m Cost At 1 January 2017 507.3 210.7 43.8 60.4 822.2 Additions – – – 11.1 11.1 Acquisitions (Note 6.1) 20.8 7.9 0.2 – 28.9 Disposals (0.6) (0.4) – (2.8) (3.8) Disposal of subsidiaries (Note 6.3) (0.4) – – – (0.4) Currency translation (44.3) (17.8) (3.6) (1.1) (66.8) At 31 December 2017 482.8 200.4 40.4 67.6 791.2 Amortisation At 1 January 2017 111.4 84.9 20.2 26.9 243.4 Charge for the year 34.3 25.4 4.8 8.7 73.2 Disposals (0.4) (0.4) – (2.8) (3.6) Disposal of subsidiaries (Note 6.3) (0.3) – – – (0.3) Currency translation (10.0) (7.4) (1.7) (0.8) (19.9) At 31 December 2017 135.0 102.5 23.3 32.0 292.8 Carrying amount At 1 January 2017 395.9 125.8 23.6 33.5 578.8 At 31 December 2017 347.8 97.9 17.1 35.6 498.4

UBM Annual Report and Accounts 2017 119 Section 4: Financial position continued

4.2 Intangible assets continued 31 December 2016 (restated) Acquired Acquired Website customer software development Acquired contracts and and and brands relationships databases software Total £m £m £m £m £m Cost At 1 January 2016 317.0 141.3 32.0 54.5 544.8 Additions – – – 6.3 6.3 Acquisitions (Note 6.1) 138.9 52.1 6.0 – 197.0 Disposals – – – (2.7) (2.7) Disposal of subsidiaries (Note 6.3) (10.4) (8.2) (0.4) – (19.0) Currency translation 61.8 25.5 6.2 2.3 95.8 At 31 December 2016 507.3 210.7 43.8 60.4 822.2 Amortisation At 1 January 2016 74.3 66.9 14.0 18.3 173.5 Charge for the year – continuing 26.7 14.2 4.2 9.5 54.6 Impairment 0.1 – – – 0.1 Disposals – – – (2.3) (2.3) Disposal of subsidiaries (Note 6.3) (4.7) (7.5) (0.3) – (12.5) Currency translation 15.0 11.3 2.3 1.4 30.0 At 31 December 2016 111.4 84.9 20.2 26.9 243.4 Carrying amount At 1 January 2016 242.7 74.4 18.0 36.2 371.3 At 31 December 2016 395.9 125.8 23.6 33.5 578.8 Relative to the total balance, the assets recognised on the Allworld Exhibitions and Advanstar acquisitions are material intangible assets. The carrying amounts of intangible assets relating to the 2016 acquisition of Allworld Exhibitions at 31 December 2017 are £121.5m relating to brands (2016: £107.5m), £37.5m relating to customer contracts (2016: £31.2m), £2.2m relating to databases (2016: £3.9m) and £1.3m relating to order backlog (2016: £3.2m). The average remaining useful economic lives are 22 years, 9 years, 9 years and 1 year respectively (2016: 15 years, 10 years, 10 years and 10 years respectively). The carrying amounts of intangible assets relating to the 2014 acquisition of Advanstar at 31 December 2017 are £180.4m relating to brands (2016: £216.2m), £43.4m relating to customer contracts (2016: £59.7m) and £9.4m relating to databases (2016: 11.9m). The average remaining useful economic lives are 11 years, 7 years and 4 years respectively (2016: 12 years, 8 years and 8 years respectively). For all other intangible assets, the average remaining useful lives for the brands and customer contracts and relationships intangible assets is 8 years and 5 years respectively (2016: 6 years and 2 years respectively). The average remaining useful lives for the other classes of intangible assets is 3 years (2016: 6 years). 4.3 Property, plant and equipment Accounting policy Property, plant and equipment are stated at cost less depreciation and impairment losses. Depreciation is provided on all items except freehold land. Depreciation rates are calculated so that assets are written down to the residual value in equal annual instalments over their expected useful lives, which are as follows: Freehold buildings and long leasehold property Up to 70 years Leasehold improvements Term of lease General plant, machinery and equipment 5–20 years Computer equipment 3–5 years Motor vehicles 3–5 years An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the item is included in the income statement in the year the asset is derecognised. The residual values, useful lives and methods of depreciation of the assets are reviewed, and adjusted if appropriate, at each financial year end. Property, plant and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount.

120 UBM Annual Report and Accounts 2017 4.3 Property, plant and equipment continued Strategic report 31 December 2017 Plant, Land and machinery buildings and vehicles Total £m £m £m Cost At 1 January 2017 59.2 27.9 87.1

Additions 2.7 7.1 9.8 Governance Disposals (0.3) (2.5) (2.8) Currency translation (1.2) (1.8) (3.0) At 31 December 2017 60.4 30.7 91.1 Depreciation At 1 January 2017 21.1 25.4 46.5 Charge for the year – continuing 3.9 4.8 8.7 Financial statements Disposals (0.3) (2.3) (2.6) Currency translation (0.6) (0.8) (1.4) At 31 December 2017 24.1 27.1 51.2 Carrying amount At 1 January 2017 38.1 2.5 40.6 At 31 December 2017 36.3 3.6 39.9 31 December 2016 (restated) Plant, Land and machinery buildings and vehicles Total £m £m £m Cost At 1 January 2016 54.6 28.6 83.2 Additions 2.3 3.1 5.4 Acquisitions (Note 6.1) – 0.4 0.4 Disposals (1.0) (7.4) (8.4) Disposal of subsidiaries (Note 6.3) – (0.1) (0.1) Currency translation 3.3 3.3 6.6 At 31 December 2016 59.2 27.9 87.1 Depreciation At 1 January 2016 16.7 26.1 42.8 Charge for the year – continuing 3.5 4.5 8.0 Disposals (0.9) (7.5) (8.4) Currency translation 1.8 2.3 4.1 At 31 December 2016 21.1 25.4 46.5 Carrying amount At 1 January 2016 37.9 2.5 40.4 At 31 December 2016 38.1 2.5 40.6 Land and buildings at carrying amount comprise:

2017 2016 £m £m Freehold 0.7 0.7 Leasehold improvements 35.6 37.4 Total carrying amount of land and buildings 36.3 38.1 Capital commitments Capital expenditure contracted for but not provided for in the financial statements amounts to nil (2016: £0.4m).

UBM Annual Report and Accounts 2017 121 Section 4: Financial position continued

4.4 Investments in joint ventures and associates Carrying amount Joint Joint ventures Associates Total ventures Associates Total 2017 2017 2017 2016 2016 2016 £m £m £m £m £m £m At 1 January 0.4 16.1 16.5 0.9 19.3 20.2 Share of profit 0.5 0.9 1.4 0.1 1.8 1.9 Remeasurement of defined benefit obligation – (0.6) (0.6) – (0.9) (0.9) Dividends received – – – (0.5) – (0.5) Disposals – – – – (4.5) (4.5) Currency translation – – – (0.1) 0.4 0.3 At 31 December 0.9 16.4 17.3 0.4 16.1 16.5 The carrying amounts of interests in joint ventures and associates at 31 December 2017 include goodwill of nil and £26.1m respectively (2016: £0.4m and £13.2m respectively). During 2017, the Group has no unrecognised share of losses in joint ventures and associates (2016: nil). The cumulative amounts of the unrecognised share of losses are nil (2016: nil). On 13 July 2016, UBM disposed of its remaining 33.3% shareholding in Light Reading LLC, for consideration of £16.1m. The carrying amount of the associate at the disposal date was £4.5m. A gain on disposal of £9.0m was reported in exceptional items in 2016 and a cash inflow of £14.9m Joint ventures No joint venture is considered individually material to the Group. The aggregate amounts of the Group’s interests in joint ventures are:

2017 2016 £m £m Revenue 3.1 1.6 Profit after tax – continuing operations 0.5 0.1 Other comprehensive income – – Total comprehensive income 0.5 0.1 Current assets 1.8 1.3 Non-current assets – – Current liabilities (1.0) (0.7) Non-current liabilities – – The principal joint ventures at 31 December 2017 are as follows:

Country of Share Type of incorporation Class of holding/ Accounting Company Segment business and operation shares held interest year end GML (Exhibitions) Thailand Co Ltd Events Exhibitions Thailand Ordinary 49.0% 31 December Guzhen Lighting Expo Co Events Exhibitions China Ordinary 51.0% 31 December No significant judgements or assumptions were made by the Group in determining the nature of interests in joint ventures. Associates No associate is considered individually material to the Group. The aggregate amounts of the Group’s interests in associates are:

2017 2016 £m £m Revenue 35.6 37.8 Profit after tax – continuing operations 0.9 1.8 Other comprehensive income (0.6) (0.9) Total comprehensive income 0.3 0.9 Current assets 17.1 20.0 Non-current assets 8.8 8.2 Current liabilities (7.8) (7.9) Non-current liabilities (27.7) (17.4)

122 UBM Annual Report and Accounts 2017 4.4 Investments in joint ventures and associates continued Strategic report Associates The Group's associates at 31 December 2017 area as follows:

Country of Share Type of incorporation/ Class of holding/ Accounting Company Segment business Registration shares held interest year end Independent Television News Limited Corporate Operations Broadcasting Great Britain Ordinary 20.0% 31 December

PA Group Corporate Operations News Distribution Great Britain Ordinary 17.0% 31 December Governance No significant judgements or assumptions were made by the Group in determining the nature of interests in associates. The Group accounts for PA Group Limited as an associate as significant influence is demonstrated through participation in the policy making process via representation on the Board of Directors. 4.5 Working capital 4.5.1 Trade and other receivables

Accounting policy Financial statements Trade receivables, which generally have 30-90 day terms, are measured at invoice amount less a provision for impairment. A provision is made when collection of the full amount is no longer probable. Trade receivables debts are written off when there is no expectation of recovery. Trade and other receivables Restated 2017 2016 £m £m Current Trade receivables 150.9 159.9 Less: provision for impairment on trade receivables (7.7) (7.9) Trade receivables – net 143.2 152.0 Other receivables 23.4 31.6 Prepayments and accrued income 50.1 45.3 216.7 228.9 Non-current Prepayments and accrued income 1.8 0.9 Other receivables 1.4 0.8 3.2 1.7 Movements on the provision for impairment of trade receivables are as follows:

Restated 2017 2016 £m £m At 1 January (7.9) (10.1) Provision for impairment of trade receivables (0.7) (0.6) Trade receivables written off during the year as uncollectible 0.4 4.6 Currency translation 0.5 (1.8) At 31 December (7.7) (7.9) There is no provision for the impairment of other receivables. As of 31 December 2017, gross trade receivables of £7.7m (2016: £7.9m) were impaired. The ageing of these receivables is as follows:

2017 2016 £m £m Under three months 1.7 0.9 Three to six months 2.1 3.0 Over six months 3.9 4.0 7.7 7.9

UBM Annual Report and Accounts 2017 123 Section 4: Financial position continued

4.5 Working capital continued 4.5.1 Trade and other receivables As of 31 December 2017, trade receivables of £0.7m (2016: £0.7m) were past due but not impaired. These relate to a number of independent customers for whom there is no recent history of default. The ageing analysis of these trade receivables is as follows:

2017 2016 £m £m Under three months 0.6 0.7 Three to six months 0.1 – 0.7 0.7 The other classes within trade and other receivables do not contain impaired assets. See Note 5.7 on credit risk of trade receivables, which explains how the Group manages and measures credit quality of trade receivables that are neither past due nor impaired. 4.5.2 Trade and other payables Accounting policy Trade payables and accruals principally comprise amounts outstanding for trade purchases and ongoing costs. Trade and other payables are measured at original cost, which approximates to their fair value.

Restated 2017 2016 £m £m Current Deferred revenue 346.7 355.0 Trade payables 22.8 22.5 Accruals 73.3 94.2 Other payables 25.6 27.1 Contingent and deferred consideration (Note 5.6) 4.8 11.3 Other taxes and social security 10.3 11.8 483.5 521.9

Non-current Accruals and deferred income 1.8 2.8 Contingent and deferred consideration (Note 5.6) 3.0 3.7 Other payables 2.7 2.7 7.5 9.2 4.6 Provisions Accounting policy Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. If the effect is material, expected future cash flows are discounted using a current pre-tax rate that reflects the risks specific to the liability. Provisions are estimates and the actual cost and timing of future cash flows are dependent on future events. Management reassesses the amounts of these provisions at each balance sheet date in order to ensure that they are measured at the current best estimate of the expenditure required to settle the obligation at the balance sheet date. Any difference between the amounts previously recognised and the current estimates is recognised immediately in the consolidated income statement. 31 December 2017 Reorganisation and Vacant restructuring properties Disposals Total £m £m £m £m At 1 January 2016 6.1 6.1 17.7 29.9 Arising/(released) during the year 3.9 – (7.3) (3.4) Utilised in the year (3.4) (0.8) (1.2) (5.4) Currency translation (0.4) (0.1) (1.1) (1.6) At 31 December 2017 6.2 5.2 8.1 19.5

Current 6.2 3.3 0.4 9.9 Non-current – 1.9 7.7 9.6 At 31 December 2017 6.2 5.2 8.1 19.5 124 UBM Annual Report and Accounts 2017 4.6 Provisions continued Strategic report 31 December 2016 (restated) Reorganisation and Vacant restructuring properties Disposals Total £m £m £m £m At 1 January 2016 7.7 4.0 7.2 18.9 Arising during the year 2.4 2.9 14.4 19.7

Utilised in the year (4.8) (1.1) (6.0) (11.9) Governance Currency translation 0.8 0.3 2.1 3.2 At 31 December 2016 6.1 6.1 17.7 29.9

Current 6.1 4.6 10.7 21.4 Non-current – 1.5 7.0 8.5 At 31 December 2016 6.1 6.1 17.7 29.9 Financial statements Provisions recognised by the Group are based on reliable estimates determined by management of the amounts payable based on available information. The amounts recorded in the above tables are continually evaluated by management. Reorganisation and restructuring The provision mainly relates to the remaining severance payments to be made in relation to the restructuring of the Advanstar integration. These provisions are expected to be utilised over the next 12 months. Vacant properties The provisions relate to obligations in respect of the continuing costs of vacant property. The quantification of the provisions depends upon the ability to exit the leases early or sublet the properties. The provisions also relate to obligations in respect of dilapidations on leasehold properties. The quantification of these provisions are dependent on actual reinstatement costs on expiry of the leases. The provisions at 31 December 2017 have been determined following external professional advice and will be utilised over the period of the leases, which range from one to ten years. The provision is discounted at an appropriate cost of capital. Liabilities relating to disposals The provisions relate to obligations arising from warranty and other claims brought against the Group in relation to disposed businesses over periods of up to seven years after the date of disposal. The decrease in the provision is primarily due to the release of warranties and indemnities recognised in accordance with specific clauses in the sale agreement of PR Newswire. The provision in respect of these items has been determined based upon the contract terms of each disposal and are reassessed on an annual basis over the period during which claims may be brought against the Group.

UBM Annual Report and Accounts 2017 125 Section 5: Capital structure and financial policy

This section covers financial assets, financial liabilities and equity held by the Group, along with associated income and expenses. This includes cash, borrowings, put option arrangements and derivatives; working capital information is included in Section 4. The instruments in place enable the Group to maintain its required capital structure; retaining conservative capital ratios in order to support the business and maximise shareholder value. Further details of the Group’s capital structure and financial instrument risk management objectives, policies and strategies are provided on page 43 of the Operating and Financial Review. Accounting policy On initial recognition, financial assets and financial liabilities are measured at fair value. Transaction costs incurred on the acquisition of derivatives and financial assets and financial liabilities measured at each reporting date at fair value are recognised as an expense when incurred. Transaction costs incurred on borrowings and other financial assets and financial liabilities measured at each reporting date at amortised cost are added to the carrying amounts of the assets or deducted from the carrying amount of the liabilities. Put option arrangements that allow non-controlling interest shareholders to require the Group to purchase the non-controlling interest are treated as derivatives over equity instruments and are initially recognised at fair value within derivative financial liabilities, with a corresponding charge directly to equity. Interest rate swaps, forward exchange contracts, put options over non-controlling interests and other derivatives are classified as financial assets or financial liabilities at fair value through profit or loss and are measured at each reporting date at fair value. Changes in the fair values are included in profit or loss within financing income/expense unless the instrument has been designated as a hedging instrument (see Note 5.5). The Group only enters into derivative contracts with counterparties with which it has a lending relationship. Liabilities for contingent and deferred consideration on acquisitions are measured at the date of acquisition (see Note 6.1) and at each subsequent reporting date at fair value (see Note 5.6) according to the terms of the purchase agreement. Changes to the fair value of such consideration are recognised in profit or loss. Contingent consideration is generally based on a multiple of revenue or profit in a specified future year. Cash and cash equivalents are classified as loans and receivables and measured at each reporting date at amortised cost. Cash and cash equivalents include cash at bank and in hand and short term deposits with an original maturity of three months or less. The cash equivalents are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value. Borrowings and bank overdrafts are measured at each reporting date at amortised cost. Amortised cost takes into account any differences between the proceeds and the maturity amount, including issue costs and any discounts or premiums due on settlement. Such differences are recognised as interest expense in the income statement over the expected life of the borrowings using the effective interest method. The amortised cost calculation is revised when necessary to reflect changes in the expected cash flows and the expected life of the borrowings including the effects of the exercise of any prepayment, call or similar options. Any resulting adjustment to the carrying amount of the borrowings is recognised as interest expense in the income statement. Partnership units investments are classified as available-for-sale financial assets and are measured at each reporting date at fair value. Changes in fair value are recognised in other comprehensive income, except for impairment and foreign exchange gains and losses, until the financial asset or liability is derecognised. Dividends on an available-for-sale equity instrument are recognised in profit or loss when the entity's right to receive payment is established. Derecognition of financial assets and liabilities A financial asset is derecognised when the rights to receive cash flows from the asset have expired. A financial liability is derecognised when the obligation under the liability is discharged, cancelled or expires. Where terms of an existing liability are substantially modified, such a modification or exchange is treated as derecognition of the original liability and recognition of a new liability, and the difference between the carrying amounts of the original liability and the fair value of the new liability is recognised in the income statement.

126 UBM Annual Report and Accounts 2017 5.1 Movements in net debt Strategic report Net debt reflects the Group’s cash and cash equivalents, borrowings and derivatives associated with debt instruments. This definition facilitates an accurate reflection of the estimated settlement at maturity.

1 January Non-cash Currency 31 December 2017 items Cash flow translation 2017 £m £m £m £m £m Cash and cash equivalents 84.8 – (6.9) (0.2) 77.7 Governance Bank overdrafts (Note 5.3) (0.5) – (3.1) – (3.6) Net cash 84.3 – (10.0) (0.2) 74.1

Bank loans due in more than one year (401.8) – 323.3 21.0 (57.5) Bonds due in more than one year (284.7) 1.0 – 24.7 (259.0) Private Placement Loan Notes due in more than one year – 0.6 (283.5) 11.1 (271.8)

Borrowings (686.5) 1.6 39.8 56.8 (588.3) Financial statements

Derivative assets associated with borrowings 5.4 (1.8) – (0.4) 3.2 Derivative liabilities associated with borrowings – (0.3) – – (0.3) Net debt (596.8) (0.5) 29.8 56.2 (511.3)

1 January Non-cash Currency 31 December 2016 items Cash flow translation 2016 £m £m £m £m £m Cash and cash equivalents 84.8 – (12.6) 12.6 84.8 Bank overdrafts (Note 5.3) (1.9) – 1.4 – (0.5) Net cash 82.9 – (11.2) 12.6 84.3

Bonds due in less than one year (254.0) 4.0 250.0 – – Bank loans due in more than one year (74.0) – (324.7) (3.1) (401.8) Bonds due in more than one year (239.5) 1.1 – (46.3) (284.7) Borrowings (567.5) 5.1 (74.7) (49.4) (686.5)

Derivative assets associated with borrowings 10.0 (5.6) – 1.0 5.4 Derivative liabilities associated with borrowings (10.3) – – 10.3 – Net debt (484.9) (0.5) (85.9) (25.5) (596.8) 5.2 Cash and cash equivalents

2017 2016 £m £m Cash at bank and in hand 77.7 84.8 77.7 84.8 Cash at bank and in hand generally earns interest at floating rates based on daily bank deposit rates. This includes short term deposits which are made for varying periods of between one day and three months earning interest at the respective short term deposit rates. The majority of the Group’s surplus cash is deposited with major banks rated at least A (Standard and Poor’s) or A2 (Moody’s). 5.3 Borrowings

2017 2016 £m £m Current Bank overdrafts (3.6) (0.5) (3.6) (0.5)

Non-current $365m bridge facility due 2018 – (295.7) $350m 5.75% dollar bonds due 2020 (259.0) (284.7) £400m syndicated revolving credit facility 2022 (57.5) (106.1) $370m US Private Placement Loan Notes (271.8) – (588.3) (686.5) UBM Annual Report and Accounts 2017 127 Section 5: Capital structure and financial policy continued

5.3 Borrowings continued $365m bridge facility due 2018 The Group entered into a $365m bridge facility agreement in December 2016 to part fund the acquisition of Allworld Exhibitions. The bridge was fully drawn and incurred interest at US LIBOR plus 0.7% until 19 June 2017 when the Group repaid the facility in full using the US Private Placement Loan Note proceeds. The facility was cancelled on 19 June 2017. $350m 5.75% dollar bonds due 2020 The Group issued $350m fixed rate dollar bonds at 98.295% of par. The bonds pay a 5.75% coupon on a semi annual basis on 3 May and 3 November until maturity in 2020. The effective interest rate is 6.17%. The coupon of 5.75% would be increased in the event the Group’s long term credit rating was to be reduced below investment grade by either Standard and Poor’s (below BBB-) or Moody’s (below Baa3). The increase to the coupon would be 0.25% per ‘ratings notch’ per agency. The Group entered into interest rate swaps for $100m whereby it receives 5.75% and pays a floating rate of US LIBOR plus 2.65% semi-annually. £400m syndicated revolving credit facility due 2022 On 7 April 2017, the Group extended the term of the variable rate multi-currency facility by one year to mature on 22 April 2022. The £400m facility bears interest of LIBOR plus 0.6% whilst the Group’s rating is BBB-/Baa3 (UBM’s current ratings). The future interest rate is dependent on the credit rating of the Group: the rate will be revised to LIBOR plus 0.9% for any downgrade to BB+/ Ba1; LIBOR plus 1.3% for downgrade to BB/Ba2 or lower; LIBOR plus 0.5% for an upgrade to BBB/Baa2; or LIBOR plus 0.4% for an upgrade to BBB+/Baa1 or higher. In addition, when 33% or less of the facility is utilised, an additional fee of 0.1% on the total amount drawn is payable; this increases to 0.2% when in excess of 33% of the facility is utilised and increases to 0.3% when in excess of 66% of the facility is utilised. Drawings under the facility at 31 December 2017 amount to £57.5m. The undrawn portion of this facility is £342.5m. The Group paid arrangement fees of £2.0m in respect of the £400m syndicated revolving credit facility. These fees are allocated to the income statement over the term of the facility using the effective interest method. $370m US Private Placement Loan Notes To replace the $365m bridge facility, $370m US Private Placement Loan Notes were issued on 15 June 2017 in three tranches: $45m of 5 year notes with a floating rate coupon of US LIBOR plus 1.65%, $175m of 7 year notes with a fixed rate coupon of 4.45% and $150m of 10 year notes with a fixed rate coupon of 4.68%. Interest is paid semi-annually in arrears. The Group entered into a 7 year interest rate swap for $78m, whereby it receives a fixed rate of 4.45% and pays a floating rate of US LIBOR plus 2.09% semi- annually in arrears, commencing 15 June 2017. 5.4 Net financing expense This note details the interest income generated on the Group’s financial assets and the interest expense incurred on borrowings and other financial assets and liabilities. In reporting ‘adjusted earnings’ the Group adjusts net financing income/expense to exclude foreign exchange gains/losses on forward contracts, ineffectiveness on hedges, other fair value movements and exceptional items. Foreign exchange and fair value movements reflect the value of these instruments at a point in time, resulting in a variable impact on profit and loss. Accounting policy Interest expense and interest income are calculated under the effective interest method. As no interest is directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to prepare for its intended use or, all interest expense is recognised as finance expense when incurred.

128 UBM Annual Report and Accounts 2017 5.4 Net financing expense continued Strategic report Net financing expense Before Before exceptional Exceptional exceptional Exceptional items items Total items items Total 2017 2017 2017 2016 2016 2016 £m £m £m £m £m £m Financing expense Borrowings and loans (27.5) – (27.5) (25.9) – (25.9) Governance Total interest expense for financial liabilities not classified at fair value through profit or loss (25.9) – (25.9) (27.5) – (27.5) Pension schemes net finance expense (Note 7.2) (1.3) – (1.3) (0.6) – (0.6) Foreign exchange loss on forward contract (0.3) – (0.3) – – – Other fair value movements (0.6) – (0.6) (0.5) – (0.5) Financing expense before exceptional items (28.1) – (28.1) (28.6) (28.6) Financial statements Exceptional financing expense Fair value movement on put options over non-controlling interests – – – – (7.1) (7.1)

Total financing expense (28.1) – (28.1) (28.6) (7.1) (35.7)

Financing income Cash and cash equivalents 1.8 – 1.8 1.5 – 1.5 Vendor loan note – – – 0.3 – 0.3 Total interest income 1.8 – 1.8 1.8 – 1.8 Fair value movement on interest rate swaps (1.5) – (1.5) (5.1) - (5.1) Fair value movement on borrowings 2.4 – 2.4 6.2 - 6.2 Ineffective portion on fair value hedges (Note 5.5) 0.9 – 0.9 1.1 – 1.1 Foreign exchange gain on forward contract – – – 0.2 – 0.2 Finance income before exceptional items 2.7 – 2.7 3.1 – 3.1

Exceptional financing income Fair value movement on put options over non-controlling interests – 5.1 5.1 – – –

Total financing income 2.7 5.1 7.8 3.1 – 3.1 Net financing expense (25.4) 5.1 (20.3) (25.5) (7.1) (32.6) The ineffective portion on fair value hedges represents the difference between the fair value movement of the interest rate swaps designated as hedge instruments and the fair value movement of the hedged portions of the $370m US Private Placement Loan Notes due in 2024 and the $350m 5.75% dollar bonds due 2020. The ineffective portion on fair value hedges in 2016 represented the difference between the fair value movement of the interest rate swaps designated as hedge instruments and the fair value movement of the hedged portions of the $350m 5.75% dollar bonds and the £250m 6.5% sterling bonds which matured in November 2016. The exceptional financing income on the fair value movement on put options over non-controlling interests is a result of a downward revision of future performance in the related businesses using updated forecast financial information. 5.5 Derivative financial instruments and hedging activities Accounting policy Hedging activities The Group uses derivative financial instruments to hedge risks and accounts for them as either fair value hedges when they hedge the exposure to changes in the fair value of a recognised asset or liability; cash flow hedges where they hedge exposure to variability in cash flows that is either attributable to a particular risk associated with a recognised asset or liability or a forecast transaction; or as a hedge of net investment in foreign operations. At the inception of a hedge relationship, the Group formally designates and documents the hedge relationship to which the Group wishes to apply hedge accounting and the risk management objective and strategy for undertaking the hedge. Such hedges are expected at inception to be highly effective and are assessed on an ongoing basis to determine whether they have been highly effective throughout the financial reporting periods for which they were designated. For fair value hedges which meet the conditions for hedge accounting, any fair value gain or loss is recognised in profit or loss. The carrying amount of the hedged item is adjusted for the change in the fair value of the hedged risk and the resulting gain or loss is recognised in profit or loss.

UBM Annual Report and Accounts 2017 129 Section 5: Capital structure and financial policy continued

5.5 Derivative financial instruments and hedging activities continued Changes in the fair value of derivative financial instruments that are designated and effective as cash flow hedges of forecast transactions are recognised in other comprehensive income. The cumulative amount recognised in other comprehensive income is reclassified into profit or loss and out of other comprehensive income in the same period in which the hedged firm commitments or forecast transactions are recognised in profit or loss. Foreign currency borrowings and forward exchange contracts are used as net investment hedges. All foreign exchange gains or losses arising on translation of net investments are recognised in other comprehensive income and included in cumulative translation differences. Foreign currency borrowings used to hedge a net investment in a foreign operation are measured using the exchange rate at the reporting date. The resulting gains or losses are taken to other comprehensive income to the extent that they are effective, with any ineffectiveness recognised in profit or loss. Forward exchange contracts used to hedge a net investment hedge are measured at fair value at the reporting date. The resulting gains or losses are taken to other comprehensive income to the extent that they are effective, with any ineffectiveness recognised in profit or loss. Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated or exercised, or no longer qualifies for hedge accounting. At that point, any cumulative gains or losses on the hedging instrument recognised in other comprehensive income are retained until the forecast transaction occurs, when they are transferred to profit or loss. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss recognised in other comprehensive income is transferred to profit or loss. Changes in the fair value of the derivative financial instruments that do not qualify for hedge accounting are recognised in profit or loss. Derivative financial instruments 2017 2016 £m £m Financial assets – current Forward exchange contracts – 0.2 – 0.2

Financial assets – non-current Interest rate swaps – hedged1 1.6 3.1 Interest rate swaps1 1.6 2.3 3.2 5.4

Financial liabilities – current Interest rate swaps – hedged1 (0.3) – Forward exchange contracts – hedged (0.1) – Put options over non-controlling interests (2.4) (3.1) (2.8) (3.1)

Financial liabilities – non-current Put options over non-controlling interests (4.8) (12.7) (4.8) (12.7) 1 Derivatives associated with debt instruments.

Hedges Net investment in foreign operations The following borrowings and US dollar cross currency interest rate swaps are designated as hedges of the indicated net investments and are used to hedge the Group’s exposure to foreign exchange risk on these investments.

Portion Net Portion Net Currency designated investment Currency designated investment Borrowing contracts as a hedge hedged Borrowing contracts as a hedge hedged 2017 2017 2017 2017 2016 2016 2016 2016 m m m m m m US dollar 720.0 – 720.0 Advanstar 846.0 – 838.9 Advanstar, and UBM UBM LLC Asia and UBM Canon Under the $125.1m cross currency contract, the Group paid annual interest of US LIBOR plus 3.14% and received GBP LIBOR plus 2.90% on £75m until 23 November 2016 when the contract matured (Note 5.3). This hedge was assessed to be highly effective during the year with the small ineffective portion of the hedging contracts transferred to financing expense (Note 5.4).

130 UBM Annual Report and Accounts 2017 5.5 Derivative financial instruments and hedging activities continued Strategic report Fair value hedges 2017 2016 £m £m Interest rate swaps – net derivative financial assets 1.3 3.1 At 31 December 2017, interest rate swaps were in place for $78m matched against $78m of the $370m US Private Placement Loan Notes due 2024. Under this swap, the Group receives a rate of 4.45% and pays a floating rate of US LIBOR plus 2.09% semi- annually in arrears. Governance Interest rate swaps at 31 December 2017 and 2016 also relate to the floating rate swaps for $100m matched against $100m of the $350m 5.75% dollar bonds due 2020. Under these swaps, the Group received 5.75% to match the bond coupons and pays six month US LIBOR plus an average of 2.65%. The interest rate swaps are used to increase the Group’s exposure to interest rates to maintain a balance of fixed and floating interest rate cost. These hedges were assessed to be highly effective at 31 December 2017 and 2016 with the small ineffective portions of the hedging contracts included in financing income. Financial statements 5.6 Fair values and fair value hierarchy Valuation techniques Valuation techniques use observable market data where it is available and rely as little as possible on entity specific estimates. The fair values of interest rate swaps and forward exchange contracts are measured using discounted cash flows. Future cash flows are based on forward interest/exchange rates (from observable yield curves/forward exchange rates at the end of the reporting period) and contract interest/forward rates, discounted at a rate that reflects the credit risk of the counterparties. The fair value portion of the $350m 5.75% dollar bonds due 2020 and the $370m US Private Placement Loan Notes have been measured at the present value of future cash flows discounted using market rates of interest. Part of the consideration received in respect of the sale of PRN in 2016 was Class A Limited Partnership Units (“partnership units”) in GTCR Canyon Holdings (Canyon), L.P, ("Canyon"), the parent of the PRN purchaser, Cision. These partnership units had a par value of $40m and an interest coupon of 8%. On 29 June 2017, Cision merged with Capitol Acquisition Holding Company Ltd, who is listed on the New York Stock Exchange. As a result of the merger, Canyon owns 68% of the ordinary shares of the listed entity, now called Cision Ltd. The partnership units in Canyon were valued at $43.4m representing the par value and accrued interest to 29 June 2017. The investment continues to be reported as an available-for-sale asset on the balance sheet. At 31 December 2017, the partnership units are valued at $51.5m. The partnership units are measured at fair value based on the quoted share price of Cision Ltd, with movements in fair value taken to other comprehensive income. The fair values of put options over non-controlling interests (including exercise price) and contingent and deferred consideration on acquisitions are measured using discounted cash flows models with inputs derived from the projected financial performance in relation to the specific contingent consideration criteria for each acquisition, as no observable market data is available. The fair values are most sensitive to the projected financial performance of each acquisition; management makes a best estimate of these projections at each financial reporting date and regularly assesses a range of reasonably possible alternatives for those inputs and determines their impact on the total fair value. An increase of 20% to the projected financial performance used in the put option measurements would increase the aggregate liability by £2.2m. The fair value of the contingent and deferred consideration on acquisitions is not significantly sensitive to a reasonable change in the forecast performance. The potential undiscounted amount for all future payments that the Group could be required to make under the contingent consideration arrangements for all acquisitions is £23.3m.

UBM Annual Report and Accounts 2017 131 Section 5: Capital structure and financial policy continued

5.6 Fair values and fair value hierarchy continued Fair values of financial assets and financial liabilities Carrying Fair Carrying Fair amount value amount value 2017 2017 2016 2016 £m £m £m £m Financial assets at fair value through profit or loss Interest rate swaps 3.2 3.2 5.4 5.4 Forward exchange contract – – 0.2 0.2 Available-for-sale financial assets Partnership units 38.1 38.1 26.8 26.8 41.3 41.3 32.4 32.4

Financial liabilities at amortised cost $350m 5.75% dollar bonds due 2020 (183.5) (190.4) (200.4) (208.8) $370m US Private Placement Loan Notes (215.0) (232.6) – – Financial liabilities at fair value through profit or loss $350m 5.75% dollar bonds due 2020 (75.5) (78.3) (84.3) (87.8) $370m US Private Placement Loan Notes (56.8) (61.4) – – Interest rate swaps (0.3) (0.3) – – Forward exchange contracts (0.1) (0.1) – – Put options over non-controlling interests (7.2) (7.2) (15.8) (15.8) Contingent and deferred consideration on acquisitions (7.8) (7.8) (15.0) (15.0) (546.2) (578.1) (315.5) (327.4) The fair values of all other financial assets and liabilities do not differ from their carrying amount. Fair value hierarchy The fair value measurements at the reporting date are classified according to the significance of the inputs used in making the measurements. The level in the hierarchy within which the fair value is categorised is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly (e.g. prices) or indirectly (e.g. derived from prices). Level 3: inputs for the assets or liabilities that are not based on observable market data. For financial assets and financial liabilities that are recognised at fair value in the financial statements on a recurring basis, the Group determines whether transfers have occurred between Levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period or the date when an event or change in circumstances caused the transfer. For the purpose of fair value disclosures, the Group has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

132 UBM Annual Report and Accounts 2017 5.6 Fair values and fair value hierarchy continued Strategic report Fair value hierarchy Financial assets and financial liabilities measured at fair value in the statement of financial position and their categorisation in the fair value hierarchy:

2017 Level 1 Level 2 Level 3 2016 Level 1 Level 2 Level 3 £m £m £m £m £m £m £m £m Financial assets at fair value through profit

or loss Governance Interest rate swaps 3.2 – 3.2 – 5.4 – 5.4 – Forward exchange contracts – – – – 0.2 – 0.2 – Available-for-sale financial assets Partnership units 38.1 – 38.1 – 26.8 – – 26.8 41.3 – 41.3 – 32.4 – 5.6 26.8

Financial liabilities at amortised cost Financial statements $350m 5.75% dollar bonds due 2020 (190.4) – (190.4) – (208.8) – (208.8) – $370m US Private Placement Loan Notes (232.6) – (232.6) – – – – – Financial liabilities at fair value through profit or loss $350m 5.75% dollar bonds due 2020 (78.3) – (78.3) – (87.8) – (87.8) – $370m US Private Placement Loan Notes (61.4) – (61.4) – – – – – Interest rate swaps (0.3) – (0.3) – – – – – Forward exchange contracts (0.1) – (0.1) – – – – – Put options over non-controlling interests (7.2) – – (7.2) (15.8) – – (15.8) Contingent and deferred consideration on acquisitions (7.8) – – (7.8) (15.0) – – (15.0) (578.1) – (563.1) (15.0) (327.4) – (296.6) (30.8) The fair value measurement of the partnership units at Level 2 is a transfer from the Level 3 valuation of the former preferred equity instrument, following the public merger detailed in the valuation techniques. During the year ended 31 December 2017 there were no transfers between Level 1 and Level 2 fair value measurements, and no other transfers into or out of Level 3 measurements. Reconciliation of level 3 fair value measurements:

Contingent Contingent Put options and deferred Put options and deferred over non- consideration over non- consideration controlling on Partnership controlling on interests acquisitions units interests acquisitions 2017 2017 20161 2016 2016 £m £m £m £m £m At 1 January (15.8) (15.0) – (13.4) (0.8) Acquisitions (Note 6.1) – (2.7) – – (13.3) Additions – – 21.9 – – Consideration paid – 8.0 – – 0.8 Exercise of put options (Note 6.2) 2.2 – – 5.8 – Changes in estimates (income statement) 5.1 1.1 1.7 (7.1) (0.4) Currency translation 1.3 0.8 3.2 (1.1) (1.3) At 31 December (7.2) (7.8) 26.8 (15.8) (15.0) 1 Changes in estimates relating to the partnership units are reported in other comprehensive income.

UBM Annual Report and Accounts 2017 133 Section 5: Capital structure and financial policy continued

5.7 Financial risk management objectives and policies The Group’s financial instrument risk management objectives, policies and strategies and the Group’s policies on capital management are set out on page 43 in the Operating and Financial Review. Interest rate risk The following tables set out the carrying amount, by maturity, of the Group’s financial instruments that are exposed to interest rate risk. 31 December 2017 Within Between Between Between Between Over 1 year 1 – 2 years 2 – 3 years 3 – 4 years 4 – 5 years 5 years Total £m £m £m £m £m £m £m Fixed rate $350m 5.75% dollar bonds due 2020 – – (183.5) – – – (183.5) $175m 4.45% US Private Placement Loan Notes due 2024 – – – – – (71.4) (71.4) $150m 4.68% US Private Placement Loan Notes due 2027 – – – – – (110.5) (110.5) – – (183.5) – – (181.9) (365.4)

Floating rate Cash and cash equivalents 77.7 – – – – – 77.7 Bank overdraft (3.6) – – – – – (3.6) Interest rate swaps – – 3.2 – – (0.3) 2.9 $45m US LIBOR plus 1.65% US Private Placement Loan Notes due 2022 – – – – (33.1) – (33.1) $175m 4.45% US Private Placement Loan Notes due 20241 – – – – – (56.8) (56.8) £400m syndicated revolving credit facility due 2022 – – – – (57.5) – (57.5) $350m 5.75% dollar bonds due 20201 – – (75.5) – – – (75.5) 74.1 – (72.3) – (90.6) (57.1) (145.9) 1 Interest rate swap arrangements convert the instrument from fixed to floating rate (detailed in Note 5.5).

Interest on financial instruments classified as floating rate is repriced at set intervals of less than one year. 31 December 2016 Within Between Between Between Between Over 1 year 1 – 2 years 2 – 3 years 3 – 4 years 4 – 5 years 5 years Total £m £m £m £m £m £m £m Fixed rate $350m 5.75% dollar bonds due 2020 – – – (200.4) – – (200.4) – – – (200.4) – – (200.4)

Floating rate Cash and cash equivalents 84.8 – – – – – 84.8 Bank overdraft (0.5) – – – – – (0.5) Interest rate swaps – – – 5.4 – – 5.4 $365m bridge facility due 2018 – (295.7) – – – – (295.7) £400m syndicated revolving credit facility due 2022 – – – – (106.1) – (106.1) $350m 5.75% dollar bonds due 20201 – – – (84.3) – – (84.3) 84.3 (295.7) – (78.9) (106.1) – (396.4) The following table demonstrates the impact on the Group’s profit before tax from possible changes in interest rates applicable to financial instruments denominated in the following currencies, with all other variables held constant.

Increase in Effect on Gains/(losses) Increase in Effect on Gains/(losses) basis profit recorded in basis profit recorded in points before tax equity points before tax equity 2017 2017 2017 2016 2016 2016 £m £m £m £m Chinese renminbi 100 0.4 – 100 0.3 – Sterling 100 (0.6) – 100 – – US dollar 100 (1.5) – 100 5.0 – A decrease in equivalent basis points would result in the exact opposite effect on profit before tax.

134 UBM Annual Report and Accounts 2017 5.7 Financial risk management objectives and policies continued Strategic report Credit risk Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Group manages its credit risk in relation to its operating activities (trade receivables) and from its financing activities, including deposits with banks and financial institutions and other financial instruments. Financial instruments and cash deposits

The following financial instruments and cash deposits are exposed to credit risk: Governance

2017 2016 £m £m Cash and cash equivalents 77.7 84.8 Interest rate swaps 3.2 5.4 80.9 90.2 The majority of the Group’s surplus cash is deposited with major banks of high quality credit standing. The Group enters into derivative contracts only with major banks of high quality credit standing. The maximum credit risk associated with the Group’s Financial statements financial instruments and cash deposits is equal to their carrying amount as set out in Note 5.2. Trade receivables Customer credit risk is managed by each business unit in accordance with the Group’s established policy, procedures and controls relating to customer credit management. Credit limits are established for all customers and are based inter alia on bank references and credit checks. Outstanding customer receivables are regularly monitored. Concentrations of credit risk with respect to trade receivables are limited due to the Group’s customer base being large and unrelated. The maximum credit risk associated with the Group’s trade receivables is equal to their carrying amount as set out in Note 4.5.1. Foreign currency risk The following table demonstrates the sensitivity of the Group’s profit before tax to a possible change in the listed currencies, with all other variables held constant, due to changes in the translated value of monetary assets and liabilities and the fair value of forward exchange contracts. Equivalent currency sensitivities are also provided for the Group’s equity due to changes in the fair value of forward exchange hedges and net investment hedges.

Effect on Gains Effect on Gains Percentage profit recorded Percentage profit recorded fall before tax in equity fall before tax in equity in currency 2017 2017 in currency 2016 2016 2017 £m £m 2016 £m £m Euro 10% – – 10% – – Japanese yen 10% – – 10% – – US dollar 10% (0.4) 53.3 10% – 68.0

Liquidity risk The tables below summarise the maturity profile of the gross contractual outflows of the Group’s financial liabilities. 31 December 2017 Due Due within 1 between 1 Due 5 years On demand year and 5 years and beyond Total £m £m £m £m £m Derivative financial liabilities – – (0.3) (0.2) (0.5) Put options over non-controlling interests – (2.4) (4.8) – (7.2) £400m variable rate multi-currency facility 2022 – (0.7) (60.8) – (61.5) $350m 5.75% dollar bonds due 2020 – (14.9) (288.7) – (303.6) $370m US Private Placement Loan Notes – (12.2) (81.8) (272.5) (366.5) Trade payables – (22.8) – – (22.8) Other payables – (35.9) (2.7) – (38.6) Contingent and deferred consideration – (4.8) (3.0) – (7.8) – (93.7) (442.1) (272.7) (808.5)

UBM Annual Report and Accounts 2017 135 Section 5: Capital structure and financial policy continued

5.7 Financial risk management objectives and policies continued Liquidity risk 31 December 2016 Due Due within 1 between 1 Due 5 years On demand year and 5 years and beyond Total £m £m £m £m £m Derivative financial liabilities – (0.1) – – (0.1) Put options over non-controlling interests – (3.1) (12.7) – (15.8) £400m variable rate multi-currency facility 2022 – (2.5) (141.5) – (144.0) $350m 5.75% dollar bonds due 2020 – (16.3) (332.4) – (348.7) $365m bridge facility – (6.7) (306.9) – (313.6) Trade payables – (23.3) – – (23.3) Other payables – (38.9) (2.7) – (41.6) Contingent and deferred consideration – (11.3) (3.7) – (15.0) – (102.2) (799.9) – (902.1) The above tables include an estimate of interest on the Group’s financial liabilities based on the forward interest rate curve and assume the liabilities are in place until their maturity dates. 5.8 Equity and dividends Accounting policy Equity instruments issued by the Company are recorded at the fair value of the proceeds received net of direct issue costs. Where any group company purchases the Company’s equity share capital, the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the owners of the Company until the shares are cancelled, reissued or disposed of. Where such shares are subsequently sold or reissued, any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the owners of the Company. Share capital 2017 2016 Authorised £m £m 1,081,888,657 (2016: 1,081,888,657) ordinary shares of 11.25 pence each 121.7 121.7

Ordinary Ordinary shares Shares Issued and fully paid number £m At 1 January 2016 442,977,538 44.3 Issued in respect of share option schemes and other entitlements prior to the share consolidation 5 – Share consolidation (49,219,727) – Issued in respect of share option schemes and other entitlements 151,042 – At 31 December 2016 393,908,858 44.3 Issued in respect of share option schemes and other entitlements 179,302 – At 31 December 2017 394,088,160 44.3 The ESOP Trust owns 0.19% (2016: 0.21%) of the issued share capital of the Company in trust for the benefit of employees of the Group and their dependents. The ESOP Trust waives its dividend entitlement and abstains from voting at general meetings. On 27 June 2016, in conjunction with the special dividend of 55.3p per share, a share consolidation was carried out to convert nine existing ordinary shares with a nominal value of 10p each to eight new ordinary shares with a nominal value of 11.25p each. The share consolidation converted the 442,997,543 existing issued and fully paid ordinary shares into 393,757,816 new issued and fully paid ordinary shares. In accordance with IAS 33, the prior period weighted average number of shares has not been restated as the share consolidation was coupled with the payment of the special dividend.

136 UBM Annual Report and Accounts 2017 5.8 Equity and dividends continued Strategic report Share premium 2017 2016 £m £m In issue at 1 January 535.3 534.7 Premium on shares issued, net of costs 0.7 0.6 In issue at 31 December 536.0 535.3

The Company received £0.7m (2016: £0.6m) on the issue of shares in respect of the exercise of options awarded under various share Governance option plans. Dividends 2017 2016 £m £m Declared and paid during the year Equity dividends on ordinary shares

Final dividend for 2016 of 16.6p (2015: 16.3p) 65.3 71.8 Financial statements Special dividend for 2016: 55.3p – 243.7 Interim dividend for 2017 of 5.5p (2016: 5.4p) 21.6 21.2 86.9 336.7

Proposed (not recognised as a liability at 31 December) Equity dividends on ordinary shares Final dividend for 2017 of 18.0p (2016: 16.6p) 70.9 65.3 There are no income tax consequences to the Group arising from the payment of dividends by the Company to its shareholders. Other reserves Foreign currency Available- Total Merger translation ESOP for-sale Other other reserve reserve reserve reserve reserves reserves £m £m £m £m £m £m Balance at 1 January 2016 (732.2) 9.4 (7.8) – 125.3 (605.3) Total comprehensive income for the year1 – 190.8 – 1.7 – 192.5 Shares awarded by ESOP – – 26.3 – – 26.3 Own shares purchased by the Company – – (24.4) – – (24.4) Balance at 31 December 2016 (732.2) 200.2 (5.9) 1.7 125.3 (410.9) Total comprehensive income for the year2 – (84.9) – 13.6 – (71.3) Shares awarded by ESOP – – 14.7 – – 14.7 Own shares purchased by the Company – – (13.9) – – (13.9) Balance at 31 December 2017 (732.2) 115.3 (5.1) 15.3 125.3 (481.4) 1 The amount included in the foreign currency translation reserve for 2016 represents the currency translation difference on foreign operations on Group subsidiaries of £197.5m (excluding £6.4m relating to non-controlling interests), on net investment hedges of £(39.0)m, on joint ventures and associates of £(0.3)m and on the reclassification adjustment for foreign operations in period of £32.6m, relating to disposals (Note 6.3). 2 The amount included in the foreign currency translation reserve for 2017 represents the currency translation difference on foreign operations on Group subsidiaries of £(141.7)m (excluding £(4.2)m relating to non-controlling interests), and on net investment hedges of £56.8m. Merger reserve The merger reserve is used to record entries in relation to certain reorganisations that took place in previous accounting periods. The majority of the balance on the reserve relates to the capital reorganisation that took place in 2008 which created a new holding company which is UK-listed, incorporated in Jersey and with its tax residence in the Republic of Ireland. The return of the Company’s tax residency to the United Kingdom in November 2012 has had no impact on these balances. Foreign currency translation reserve The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign subsidiaries. It is also used to record the effect of hedging net investments of foreign operations. ESOP reserve The ESOP reserve records ordinary shares held by the ESOP Trust to satisfy future share awards. The shares are recorded at cost. During the year ended 31 December 2017, 1,915,285 shares were purchased by the ESOP (2016: 3,787,951 shares) at a cost of £13.9m (2016: £24.4m). The Company received contributions of £6.7m (2016: £18.0m) from employees relating to the exercise price of share options and awards granted in prior years. Available-for-sale reserve The available-for-sale reserve is used to record fair value movements on the partnership units issued to the Group as part of the consideration for the disposal of the PR Newswire business.

UBM Annual Report and Accounts 2017 137 Section 6: Acquisitions and disposals

6.1 Acquisitions Growth through acquisitions is one of the Group’s priorities in order to deliver its Events First strategy. Further details of the Group’s strategy are provided in the Strategic Report on pages 10 to 12. The Group completed five acquisitions during 2017 of which Arabian Exhibition Management WLL (AEM) was significant (2016: five acquisitions of which Allworld Exhibitions (Allworld) and Business Journals Inc. (BJI) were significant). Accounting policy The Group uses the acquisition method to account for business combinations. The consideration transferred is measured at the amount of cash and cash equivalents transferred, the fair value of any equity instruments transferred and the fair value of any contingent consideration arrangement. Subsequent changes to the fair value of the contingent consideration which is classified as a financial liability that is within the scope of IAS 39 are recognised in profit or loss. The Group recognises the fair values of the assets acquired, the liabilities (including contingent liabilities) assumed, and the equity interests issued by the Group. For significant acquisitions, management is assisted by external advisors in identifying and measuring the fair values of any intangible assets acquired. On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the acquiree either at fair value (under the full goodwill method) or at the proportionate share of the acquiree’s identifiable net assets. When the full goodwill method is used, the fair value of the non-controlling interest is measured using a multiples approach adjusted for the discount that market participants would expect for the lack of control. Acquisition costs incurred are recognised as an expense in the income statement in the period incurred and classified as exceptional items. If a business combination is achieved in stages, the acquisition date carrying amount of the Group’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date through profit or loss. All 2017 and 2016 acquisitions where less than 100% of the voting rights of a company were purchased have been accounted for using the full goodwill method. 2017 acquisitions The Group has acquired 100% of the voting rights in all cases where acquisitions involved the purchase of companies unless otherwise stated below.

Initial and Maximum 2017 deferred contingent acquisition consideration consideration Acquisition date Activity Segment £m £m Arabian Exhibition 13 January Events operator in multiple Events 48.4 – Management WLL (AEM) industries Marmara Tanitim Fuarcilik 2 February LED & lighting exhibition Events 0.7 0.2 Organizasyon Reklam ve Ticaret A.S (Marmara) AMA Research Limited (AMA) 3 April Provider of market research, OMS 1.4 – data and bespoke reports Green Thinking (Services) 22 September Renewable energy exhibition Events 5.7 10.0 Limited (GTSL) and conferences The Aesthetic Show 13 November Healthcare exhibition and Events 4.6 – conference 60.8 10.2 The initial and deferred consideration amounts are after working capital adjustments. Arabian Exhibition Management WLL (AEM) On 13 January 2017, the Group acquired 100% of Arabian Exhibition Management WLL (AEM) for cash consideration of £48.4m. AEM is the Bahrain business of Allworld Exhibitions. The majority of the Allworld Exhibitions acquisition completed on 19 December 2016 and was reported as an acquisition in 2016. The Bahrain business was subject to separate close conditions and completed on 13 January 2017.

138 UBM Annual Report and Accounts 2017 6.1 Acquisitions continued Strategic report 2016 acquisitions The Group has acquired 100% of the voting rights in all cases where acquisitions involved the purchase of companies unless otherwise stated below.

Initial and Maximum 2016 deferred contingent acquisition consideration consideration Acquisition date Activity Segment £m £m Business Journals Inc. (BJI) 21 April Fashion events Events and 50.0 - Governance and associated online and OMS print products Content Marketing Institute 31 May Content marketing events Events and 11.3 13.7 (CMI) and online OMS Smarter Shows (Power) 31 October Battery (power and Events 12.0 2.3 Holdings Limited (The technology) event Battery Show) Boannews Co., Ltd (Secon) 31 October Integrated security exhibition Events 1.8 0.4 Financial statements 60% Allworld Exhibitions (Allworld) 19 December Events operator in multiple Events 379.7 - industries 454.8 16.4 The initial and deferred consideration amounts are after working capital adjustments. Acquired net assets The fair value of the identifiable assets and liabilities acquired in respect of acquisitions (excluding equity transactions) made in 2017 and 2016 was:

Other All Restated Other Restated AEM acquisitions acquisitions Allworld BJI acquisitions All acquisitions 2017 2017 2017 2016 2016 2016 2016 £m £m £m £m £m £m £m Intangible assets arising on acquisition 23.7 5.2 28.9 168.8 15.1 13.1 197.0 Property, plant and equipment – – – 0.4 – – 0.4 Trade and other receivables 2.4 1.4 3.8 11.9 2.9 2.1 16.9 Deferred tax asset – 0.2 0.2 – – – – Cash and cash equivalents 4.2 0.7 4.9 28.9 3.7 1.1 33.7 30.3 7.5 37.8 210.0 21.7 16.3 248.0 Trade and other payables (4.9) (2.6) (7.5) (23.5) (5.4) (3.1) (32.0) Current tax liability – – – (6.3) – (0.1) (6.4) Deferred tax liability – (0.5) (0.5) (27.5) – (1.1) (28.6) Provisions – – – (0.5) – – (0.5) (4.9) (3.1) (8.0) (57.8) (5.4) (4.3) (67.5) Identifiable net assets 25.4 4.4 29.8 152.2 16.3 12.0 180.5 Goodwill arising on acquisition 23.0 9.2 32.2 227.5 33.7 22.2 283.4 Non-controlling interests – – – – – (1.5) (1.5) 48.4 13.6 62.0 379.7 50.0 32.7 462.4 The goodwill recognised on the acquisition of AEM is not expected to be deductible for tax purposes. Trade and other receivables acquired have been measured at fair value which is the gross contractual amounts receivable. All amounts recognised are expected to be collected. The intangible assets acquired as part of the acquisitions were:

Other All Restated Other Restated AEM acquisitions acquisitions Allworld BJI acquisitions All acquisitions 2017 2017 2017 2016 2016 2016 2016 £m £m £m £m £m £m £m Brands 18.1 2.7 20.8 121.7 11.2 6.0 138.9 Order backlog – – – 4.4 0.1 0.8 5.3 Customer relationships 5.6 2.3 7.9 40.0 2.8 4.0 46.8 Customer contracts and relationships 5.6 2.3 7.9 44.4 2.9 4.8 52.1 Databases – 0.2 0.2 2.7 0.9 2.3 5.9 Software – – – – 0.1 – 0.1 Total 23.7 5.2 28.9 168.8 15.1 13.1 197.0

UBM Annual Report and Accounts 2017 139 Section 6: Acquisitions and disposals continued

6.1 Acquisitions continued Acquired net assets The total consideration transferred on acquisitions is as follows:

Other All Other AEM acquisitions acquisitions Allworld BJI acquisitions All acquisitions 2017 2017 2017 2016 2016 2016 2016 £m £m £m £m £m £m £m Cash and cash equivalents 48.4 11.1 59.5 376.1 49.0 24.0 449.1 Fair value of contingent consideration – 1.2 1.2 – – 7.6 7.6 Deferred consideration – 1.3 1.3 3.6 1.0 1.1 5.7 Total consideration transferred 48.4 13.6 62.0 379.7 50.0 32.7 462.4 Acquisition costs of £2.2m (2016: £6.7m) have been recognised as an exceptional operating item in the income statement and are included in operating cash flows in the statement of cash flows. £1.9m of these costs related to the acquisition of Allworld (2016: £4.7m and £0.7m related to Allworld and BJI respectively). Acquisition performance From their respective dates of acquisition to 31 December 2017, the acquisitions completed in 2017 contributed £13.7m to revenue and £3.3m to adjusted operating profit to the Group. If the acquisitions had taken place at the beginning of 2017, the acquisitions would have contributed £18.4m to revenue and £4.6m to adjusted operating profit of the Group. From their respective dates of acquisition to 31 December 2016, the acquisitions completed in 2016 contributed £21.5m to revenue and £4.4m to adjusted operating profit to the Group. If the acquisitions had taken place at the beginning of 2016, the acquisitions would have contributed £107.7m to revenue and £31.8m to adjusted operating profit of the Group, of which £68.2m of revenue and £23.2m of adjusted operating profit would have been contributed by Allworld. Cash flow effect of acquisitions The aggregate cash flow effect of acquisitions was as follows:

Other All Other AEM acquisitions acquisitions Allworld BJI acquisitions All acquisitions 2017 2017 2017 2016 2016 2016 2016 £m £m £m £m £m £m £m Net cash acquired (4.2) (0.7) (4.9) (28.9) (3.7) (1.1) (33.7) Cash paid to acquire 48.4 11.1 59.5 376.1 49.0 24.0 449.1 Contingent consideration paid: 2016 acquisitions – 3.2 3.2 – – – – 2012 acquisitions – – – – – 0.8 0.8 Deferred consideration paid: 2016 acquisitions – 4.7 4.7 – – – – 2015 acquisitions – 0.1 0.1 – – – – Net cash outflow on acquisitions 44.2 18.4 62.6 347.2 45.3 23.7 416.2 The Group paid £3.2m of contingent consideration during 2017 in relation to 2016 acquisitions, of which £2.0m was in relation to the acquisition of CMI, and £1.2m related to The Battery Show. The Group paid £4.7m of deferred consideration during 2017 in relation to 2016 acquisitions, of which £3.5m was in relation to the acquisition of Allworld, £1.0m related to CMI and the remaining £0.2m related to BJI and Secon. The Group paid £0.1m of deferred consideration during 2017 in relation to the 2015 acquisition of Shanghai International Printing Industry Expo (CSTPF). The Group paid £0.8m of contingent consideration during 2016 in relation to the 2012 acquisition of UBM ICC Fuarcilik ve Organizasyon Ticaret A.Ş.

140 UBM Annual Report and Accounts 2017 6.2 Equity transactions Strategic report Accounting policy When there is a change in ownership of a subsidiary without a change in control, the difference between the consideration paid/ received and the relevant share of the carrying amount of net assets acquired/disposed of the subsidiary is recorded in equity. The carrying amounts of the controlling and non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiary. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid is recognised directly in equity.

2017 2016 Governance £m £m Cash paid 2.0 5.8 Deferred consideration 0.2 – Put option liability (2.2) (5.8) Carrying amount of non-controlling interest at acquisition date (0.7) (3.9) Recognised in equity (0.7) (3.9)

On 27 September 2017, the Group acquired the remaining 20% minority shareholding of Rotaforte International Trade Fairs Financial statements and Media for initial consideration of £2.0m and deferred consideration of £0.2m. This equity purchase brings the Group’s total shareholding in Rotaforte International Trade Fairs and Media to 100%. On 29 February 2016, the Group acquired the remaining 25% minority shareholding of Sienna Interlink Comunicacoes Ltda for total cash consideration of £2.3m. This equity purchase brought the Group’s total shareholding in Sienna Interlink Comunicacoes Ltda to 100%. On 9 June 2016, the Group acquired the remaining 25% minority shareholdings of Intermodal Organizacao de Eventos S.A. Ltda and UBM Brazil Feiras e Eventos Ltda for total cash consideration of £2.7m. This equity purchase brought the Group’s total shareholdings in Intermodal Organizacao de Eventos S.A. and UBM Brazil Feiras e Eventos Ltda to 100%. On 8 September 2016, the Group acquired a further 15% shareholding of UBM ICC Fuarcilik ve Organizasyon Ticaret A.Ş (ICC) for total cash consideration of £0.8m. This equity purchase brought the Group’s total shareholding in ICC to 85%. 6.3 Disposals The Group continues to make disposals in order to further progress towards a portfolio of integrated cross-media marketing and communication services designed to serve specific commercial and professional communities. These disposals have generated resources to invest in activities that are closely linked to the Group’s strategic priorities. Disposals are disclosed as part of the Group’s discontinued operations when they represent a single major line of business or geographical area of operations, as required by IFRS 5 ‘Non-current assets held for sale and discontinued operations’. Accounting policy When the Group disposes of, or loses control, joint control or significant influence over a subsidiary, joint venture or associate, it derecognises the assets (including goodwill) and liabilities of the entity, the carrying amount of any non-controlling interest and any cumulative translation differences recorded in equity. The fair value of the consideration received and the fair value of any investment retained is recognised. The resulting gain or loss for disposals not disclosed as discontinued operations is recognised in profit or loss within ‘other operating income/expense’ or in exceptional items if the gain or loss is material. 2017 Disposals Initial and 2017 deferred Gain/(loss) disposal consideration on disposal Disposal date Activity Segment £m £m Customer Tech portfolio and 8 September Marketing and care shows Events 3.3 2.6 Care & Dementia Show 3.3 2.6 On 15 May 2017, the Group disposed of its 100% owned subsidiary UBM Index Trade Fairs Private Limited (Index) for consideration of £1,000. The net assets disposed were impaired to their recoverable amount at 31 December 2016, resulting in no gain or loss on disposal. Index was not classified as a discontinued operation and the disposal had an immaterial effect on the Group’s assets and liabilities. 2016 Disposals Initial and 2016 deferred Gain disposal consideration on disposal Disposal date Activity Segment £m £m PR Newswire 16 June Newswire distribution PR Newswire 595.1 389.1 services Electronics Media portfolio 29 July Electronics media OMS 19.2 9.2 Ecobuild 12 December UK sustainable construction Events – (35.1) show 614.3 363.2 UBM Annual Report and Accounts 2017 141 Section 6: Acquisitions and disposals continued

6.3 Disposals continued The Group disposed of its PR Newswire businesses on 16 June 2016 for cash consideration of $810m and partnership units of $40m, measured at $31m (£21.9m) on a fair value basis at that date. The partnership units constitute 400,000 Class A limited partnership units in the purchaser parent with a par value of $40m and interest coupon of 8%. At 31 December 2016, the fair value of the preferred equity was £26.8m and was reported within ‘available-for-sale investments’. The Group also disposed of the following investments: −− on 22 April 2016, UBM disposed of its 9.5% investment in Janus SAS for consideration of £2.1m. A profit of £2.2m has been recognised within exceptional operating items (Note 3.5); and −− on 13 July 2016, UBM disposed of its investment in Light Reading LLC for consideration of £16.1m and a profit of £9.0m has been recognised in exceptional operating items (Note 3.5). Disposed net assets The aggregate effect of the disposals on the Group’s assets and liabilities were as follows:

Total Total 2017 2016 £m £m Goodwill 2.6 131.4 Intangible assets 0.1 13.1 Property, plant and equipment – 13.2 Deferred tax assets – 1.6 Investment in joint ventures and associates – 2.1 Trade and other receivables 1.9 50.8 Cash and cash equivalents – 5.2 Total assets 4.6 217.4 Trade and other payables (4.1) (56.8) Deferred tax liability – (1.1) Total liabilities (4.1) (57.9) Identifiable net assets 0.5 159.5 Costs associated with disposal 0.2 38.6 Loss on deal contingent forward – 20.4 Cumulative exchange loss reclassified to profit and loss on disposal – 32.6 Profit on disposal 2.6 363.2 Consideration received 3.3 614.3 Less cash disposed and deferred consideration – (5.2) Less preferred equity – (21.9) Translation difference using deal contingent forward – (41.4) Net cash inflow 3.3 545.8 6.4 Discontinued operations and assets held for sale Accounting policy Non-current assets or disposal groups are classified as held for sale if: their carrying amount will be recovered principally through sale, rather than continuing use; they are available for immediate sale; and the sale is highly probable. A disposal group consists of assets that are to be disposed of, by sale or otherwise, in a single transaction together with the directly associated liabilities. Goodwill arising from business combinations is included for cash generating units which are part of the disposal group. On initial classification as held for sale, non-current assets or components of a disposal group are remeasured at the lower of their carrying amount and fair value less costs to sell. Any impairment on a disposal group is first allocated to goodwill and then to remaining assets and liabilities on a pro rata basis. Impairment on initial classification as held for sale and subsequent gains or losses on remeasurement are recognised in the income statement. Gains are not recognised in excess of any cumulative impairment. No amortisation or depreciation is charged on non-current assets (including those in disposal groups) classified as held for sale. Assets classified as held for sale are disclosed separately on the face of the statement of financial position and classified as current assets or liabilities, with disposal groups being separated between assets held for sale and liabilities held for sale.

142 UBM Annual Report and Accounts 2017 6.4 Discontinued operations and assets held for sale continued Strategic report 2016 discontinued operations As disclosed in Section 1, the sale of the PR Newswire businesses was completed during 2016. PR Newswire was recognised as discontinued at 31 December 2016. During 2017, the Group has recognised an additional £7.8m gain on disposal of PR Newswire primarily due to the release of warranties and indemnities recognised in accordance with specific clauses in the sale agreement. This gain has been recognised as an exceptional item for discontinued operations for the year ended 31 December 2017. The gain has a 2.0 pence impact on basic and diluted earnings per share and no cash flow effect.

The results of the discontinued operations which have been included in the consolidated income statement in 2016 were as follows: Governance

PR Newswire 2016 £m Revenue 103.0 Other operating income 0.1 Operating expenses (75.2)

Share of results from joint ventures and associates 0.2 Financial statements Adjusted operating profit from discontinued operations 28.1 Amortisation of intangible assets arising on acquisitions – Exceptional operating items 390.2 Profit before tax from discontinued operations 418.3 Attributable tax (1.8) Exceptional tax items (1.1) Profit for the year from discontinued operations 415.4

Earnings per share for discontinued operations Basic 98.2 Diluted 97.2

Net cash flows attributable to discontinued operations Net cash from operating activities 20.9 Net cash from investing activities (3.9) Net cash from financing activities (26.9) Net cash flows attributable to discontinued operations (9.9) The PR Newswire exceptional item was the profit on disposal of £389.1m which included: −− £34.8m of disposal costs for services incurred relating to the disposal. The costs included broker fees, management transaction bonuses, legal advice and warranties and indemnities recognised in accordance with specific clauses in the sale agreement; and −− £20.4m foreign exchange loss on the fair value measurement of a deal contingent forward used to fix the US dollar proceeds into sterling which was in addition to a £21.0m loss recognised in 2015. Consistent with the accounting treatment adopted for a similar instrument taken out for the Advanstar acquisition, hedge accounting was not applied. In addition, included in discontinued operations was an £8.2m charge for the settlement of the Axio legal dispute in respect of the Delta disposal after specific provisions, recoveries and legal costs. The total net exceptional credit for discontinued operations in 2016 was £380.9m.

UBM Annual Report and Accounts 2017 143 Section 7: Employee benefits

7.1 Employee costs

2017 2016 Continuing £m £m Wages and salaries 225.9 211.5 Social security costs 18.2 16.4 Share-based payments (Note 7.3) 5.4 5.9 Pension costs – defined contribution plans (Note 7.2) 4.3 3.0 Pension costs1 – defined benefit plans (Note 7.2) (3.1) (3.9) 250.7 232.9 1 Includes net gain of £4.1m (2016: £5.0m) resulting from the pension scheme initiatives. Employee costs for the total group in 2016 totalled £281.0m. Employee numbers 2017 2017 2016 2016 Continuing Average Year end Average Year end Location United Kingdom 758 757 733 752 United States and Canada 1,199 1,176 1,210 1,209 Continental Europe 140 144 125 137 China 931 998 846 891 Emerging Markets 694 681 531 697 Rest of the world 169 177 141 166 3,891 3,933 3,586 3,852 Operating segments Events 3,152 3,205 2,996 3,222 Other Marketing Services 630 621 472 515 Corporate Operations 109 107 118 115 3,891 3,933 3,586 3,852 7.2 Retirement benefit obligations The Group operates funded defined benefit and defined contribution pension schemes in the UK and overseas. The defined benefit schemes included in the following disclosures are: (i) UK schemes: the UBM Pension Scheme (UBMPS) and the United Newspapers Executive Pension Scheme (UNEPS); and (ii) US schemes: CMP Post Retirement Medical Plan. Both the UK plans are final salary pension plans, which provide benefits to members in the form of a guaranteed level of pension payable for life. The level of benefits provided depends on members’ length of service and their salary in the final years leading up to retirement. All the liabilities in the schemes relate to members who are deferred members, and pensions in payment. The UBMPS was closed to future accrual in 2016. Responsibility for governance of the plans – including investment decisions and contribution schedules – lies jointly with the Company and the Board of Trustees. The Board of Trustees must comprise one-third nominated by the plan members and the remainder are appointed by the company and can include independent appointees, in accordance with the plan’s regulations. Deferred member’s benefits and pensions in payment are increased by a fixed amount or updated in line with RPI or CPI inflation in accordance with the specific rules applying to the members' scheme section. Plan assets are held in Trusts and are invested in accordance with the Statement of Investment Principles. Every three years, in accordance with legislation, the Board of Trustees reviews the level of funding of the pension plans and the level of contribution required by the Group to clear the deficit. Following the 2014 funding valuation, the Group agreed to make special contributions to the UK pension schemes of £2.5m per annum until June 2019. This contribution schedule remains in place until the 2017 funding valuations are finalised, which is expected in the first half of 2018. The following initiatives have taken place in the UBMPS scheme in 2017 in line with Government pension freedom flexibilities, to give members greater access to their pension: −− Pension Increase Exchange allows pensioners to exchange some of their future annual increases for a one-off uplift in pension, supported by independent financial advice. This option has now been implemented as an option for pensions at the point of retirement. The exchange results in the scheme liabilities and deficit being reduced and a past service credit in the income statement.

144 UBM Annual Report and Accounts 2017 7.2 Retirement benefit obligations continued Strategic report Accounting policy For the defined contribution schemes, the contributions paid or payable in respect of employee service rendered during the accounting period are recognised as an expense in that period. For the defined benefit pension schemes, the liability for the benefits earned by employees in return for service rendered in the current and prior periods is determined using the projected unit credit method as determined annually by qualified actuaries. This is based upon a number of assumptions, the determination of which is significant to the valuation. The following are charged to operating profit: Governance −− the net finance expense measured using the discount rate applied in measuring the defined benefit obligation; −− the increase in the present value of pension scheme liabilities arising from employee service in the current period (current service cost); −− the increase in the present value of pension scheme liabilities as a result of benefit improvements over the period during which such improvements vest (past service cost);

−− gains and losses arising on settlements/curtailments; and Financial statements −− scheme administration costs. Actuarial gains and losses are recognised in full in other comprehensive income in the period in which they occur. Defined benefit pension surpluses are recognised when scheme rules indicate that such surpluses are recoverable as either an unconditional right to refund if the scheme were to be wound up or reductions in future contributions. The availability of refunds or reductions of future contributions takes into account any minimum funding requirement of the UK defined benefit schemes. Any tax expense arising on refunds is deducted from any surplus recognised. Any gains or losses arising on the recognition of defined benefit plan surpluses or adjustments to such surpluses are recognised in other comprehensive income. Defined contribution schemes The expense for the year for defined contribution schemes was £4.3m (2016: £3.0m). Defined benefit schemes The preliminary results for the 2017 actuarial funding valuations for the UK schemes were updated to 31 December 2017 for accounting purposes by qualified actuaries. Assumptions and sensitivities Principal actuarial assumptions used in determining pension obligations for the Group’s UK schemes:

UK UK schemes schemes 2017 2016 £m £m Discount rate 2.50 2.70 Future salary increases n/a n/a Weighted average pension increases 2.90 3.25 Retail price inflation 3.15 3.25 Consumer price inflation 2.15 2.25 At 31 December 2017, the discount rate is determined by discounting the estimate future cash flows using interest rates of corporate bonds with an “AA” rating and that have terms to maturity approximate to the terms of the related pension liability. The life expectancy rates used are 105% of the ‘SAPS’ S2 tables based on the year of birth of scheme members, which is currently on average 1943 for pensioners and 1958 for non-pensioners. Allowances for future changes in mortality rates are in line with the CMI 2016 projections with a 1% p.a. long term trend rate (2016: CMI 2015 projections with a 1% p.a. long term trend rate). These projections allow for life expectancy to improve over time due to improvements in medical treatments and other lifestyle factors such that younger members who have not yet reached pensionable age are expected to live longer than current pensioner members. The assumed average life expectancy of current pensioner members at age 65 is 21.7 years for males and 23.7 years for females (2016: 21.7 years and 23.8 years respectively). For current non-pensioner members aged 45, the assumed average life expectancy at age 65 is 22.8 years for males and 24.8 years for females (2016: 23.0 years and 25.3 years respectively). The average rate of improvement underlying the standard tables is an increase of approximately 0.8 years life expectancy in every 10 years (2016: 0.8 years). For the valuation of US scheme liabilities, the 2016 valuation has been maintained. RP 2014 mortality tables and MP 2014 longevity improvements model have been used. The assumed average life expectancy of current pensioner members at age 65 is 21.6 years for males and 23.8 years for females (2016: 21.6 years and 23.8 years respectively). Non-pensioner members are assumed to take cash lump sums at retirement. Additional assumptions used for valuing the UK scheme liabilities are an allowance for all non-pensioners to take 25% of pension as tax-free cash upon retirement (2016: 25%).

UBM Annual Report and Accounts 2017 145 Section 7: Employee benefits continued

7.2 Retirement benefit obligations continued Assumptions and sensitivities The discount rate, assumed salary increases and assumed mortality all have a significant effect on the measurement of the defined benefit obligation. The sensitivity of the valuation to changes in these assumptions is as follows:

Impact on Impact on deficit deficit 2017 2016 £m £m 0.25 percentage point decrease to discount rate +19.8 + 25.0 0.25 percentage point increase to discount rate -19.8 -24.0 0.25 percentage point increase to inflation1 (including pension increases linked to inflation) +8.5 + 13.0 0.25 percentage point decrease to inflation1 (including pension increases linked to inflation) -8.4 -13.0 One year increase to life expectancy +24.9 + 20.0 One year decrease to life expectancy -24.9 -21.0 1 Inflation includes the effects of RPI and CPI. The sensitivity analyses above have been determined based on a method that extrapolates the impact on defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. Risks and uncertainties Plan assets are mainly invested in equities, bonds, gilts, property and diversified growth funds and are exposed to the risks outlined below: Asset volatility The plan liabilities are calculated using a discount rate set with reference to corporate bond yields; if plan assets underperform this yield, this will create a deficit. The UBMPS holds a significant proportion of equities, which are expected to outperform bonds in the long term while providing volatility and risk in the short term. The Group believes that due to the long term nature of the plan liabilities and the strength of the supporting group, a level of continuing equity investment is an appropriate element of the Group’s long term strategy to manage the plans efficiently. Some of the UBMPS’ assets are invested in Diversified Growth Funds. These funds invest in a wide range of assets including equities, bonds, commodities and cash. These actively managed funds aim to provide equity-like returns over the medium to long term, but with less volatility. Changes in bond yields A decrease in corporate bond yields will increase plan liabilities, although this will be partially offset by an increase in the value of the plans’ bond holdings. Inflation Risk Some of the Group pension obligations are linked to inflation, and higher inflation will lead to higher liabilities (although, in most cases, caps on the level of inflationary increases are in place to protect the plan against extreme inflation). Within the plans’ assets are some UK government bonds linked to inflation however the majority of the plans’ assets are either unaffected by inflation or loosely correlated with inflation (equities), meaning that an increase in inflation will also increase the deficit. Life expectancy The majority of the plans’ obligations are to provide benefits for the life of the member, so increases in life expectancy will result in an increase in the plans’ liabilities. Financial position UK Other UK Other schemes schemes Total schemes schemes Total 2017 2017 2017 2016 2016 2016 £m £m £m £m £m £m Fair value of plan assets 547.2 – 547.2 547.5 – 547.5 Defined benefit obligation (549.5) (0.9) (550.4) (594.4) (1.0) (595.4) Irrecoverable element of pension surplus1 (2.6) – (2.6) (2.7) – (2.7) Net deficit in the statement of financial position (4.9) (0.9) (5.8) (49.6) (1.0) (50.6)

Schemes in surplus 4.8 – 4.8 4.9 – 4.9 Schemes in deficit (9.7) (0.9) (10.6) (54.5) (1.0) (55.5) Net deficit in the statement of financial position (4.9) (0.9) (5.8) (49.6) (1.0) (50.6) 1 Under IFRIC 14, any surplus on the UK schemes ultimately repaid to the Company by the Trustees would currently be subject to a 35% tax charge prior to being repaid. One of the UK schemes is in surplus at 31 December 2017 (2016: one UK scheme). The weighted average duration of the defined benefit obligation is 15.0 years (2016: 17.0 years).

146 UBM Annual Report and Accounts 2017 7.2 Retirement benefit obligations continued Strategic report Movement in the amounts recognised in the statement of financial position:

UK Other UK Other schemes schemes Total schemes schemes Total 2017 2017 2017 2016 2016 2016 £m £m £m £m £m £m At 1 January (49.6) (1.0) (50.6) (24.0) (0.7) (24.7) Total income recognised in the income statement 2.0 – 2.0 4.4 – 4.4 Governance Net actuarial gains/(losses) recognised in the year 39.4 – 39.4 (43.6) (0.4) (44.0) Irrecoverable element of pension surplus – – – – – – Contributions paid by the Group 3.3 0.1 3.4 13.6 0.1 13.7 At 31 December (4.9) (0.9) (5.8) (49.6) (1.0) (50.6) Reconciliation of the defined benefit obligation:

UK Other UK Other

schemes schemes Total schemes schemes Total Financial statements 2017 2017 2017 2016 2016 2016 £m £m £m £m £m £m Defined benefit obligation at 1 January 594.4 1.0 595.4 502.8 0.7 503.5 Service cost – – – 0.3 – 0.3 Past service credit (4.3) – (4.3) (5.1) – (5.1) Interest cost 15.3 – 15.3 18.0 – 18.0 Employee contributions – – – 0.1 – 0.1 Curtailment gain – – – (1.0) – (1.0) Benefit payments (46.3) (0.1) (46.4) (28.3) (0.1) (28.4) Actuarial loss/(gain) on liabilities – financial assumptions 12.1 – 12.1 107.4 – 107.4 Actuarial loss/(gain) on liabilities – demographic assumptions (7.4) – (7.4) – – – Actuarial loss/(gain) on liabilities – experience (14.3) – (14.3) 0.2 0.2 0.4 Currency translation – – – – 0.2 0.2 Defined benefit obligation at 31 December 549.5 0.9 550.4 594.4 1.0 595.4 Reconciliation of the plan assets:

UK Other UK Other schemes schemes Total schemes schemes Total 2017 2017 2017 2016 2016 2016 £m £m £m £m £m £m Assets at 1 January 547.5 – 547.5 481.3 – 481.3 Employer contributions1 3.3 0.1 3.4 13.6 0.1 13.7 Employee contributions – – – 0.1 – 0.1 Administration cost (1.0) – (1.0) (0.8) – (0.8) Benefit payments (46.3) (0.1) (46.4) (28.3) (0.1) (28.4) Actual return on assets 43.7 – 43.7 81.6 – 81.6 Assets at 31 December 547.2 – 547.2 547.5 – 547.5 1 Employer contributions in 2016 included a one-off £10m contribution following the disposal of PR Newswire.

UBM Annual Report and Accounts 2017 147 Section 7: Employee Benefits continued

7.2 Retirement benefit obligations continued Assets held in the schemes, split by asset category:

UK Other UK Other schemes schemes Total schemes schemes Total 2017 2017 2017 2016 2016 2016 £m £m £m £m £m £m Equities UK quoted 65.4 – 65.4 57.6 – 57.6 Overseas quoted 100.2 – 100.2 104.0 – 104.0 Bonds Inflation-linked bonds 13.4 – 13.4 14.4 – 14.4 Property 49.0 – 49.0 46.7 – 46.7 Annuity contracts 6.4 – 6.4 7.5 – 7.5 Other Illiquid credit funds 51.6 – 51.6 48.8 – 48.8 LIBOR funds 70.4 – 70.4 37.5 – 37.5 Bespoke funds (LDI) 73.8 – 73.8 110.1 – 110.1 Diversified growth funds 112.2 – 112.2 107.1 – 107.1 Cash 4.8 – 4.8 13.8 – 13.8 547.2 – 547.2 547.5 – 547.5 The plan assets do not include any financial instruments in UBM plc or any property occupied by the Group. Approximately 38.0% of the UK plan assets are held in a combination of government bonds, credit, LIBOR and bespoke Liability Driven Investment (LDI) funds. The objective of this allocation is to provide protection against the impact of interest rate and inflation movements as well as giving an expected return above government yield bonds. The LDI fund is a unit fund invested with Legal & General, and the underlying investments include derivatives. The LDI portfolio is designed to match approximately 60% of the interest rate and inflation exposure of the UK Pension Scheme liabilities. The illiquid credit fund is managed by M&G, with underlying investments in a variety of credit instruments. The investment objective of the fund is a total return of three month LIBOR plus 5% (over a 5 year investment period) net of fees. Diversified growth funds (DGFs) are multi-asset funds held with Newton and Schroder. The DGF allocation contains a variety of underlying asset classed including equities, bonds and alternative assets and seeks to achieve long term equity type returns but with lower volatility. By appointing a DGF manager, asset allocation decisions are delegated to the fund manager. Income statement UK Other UK Other schemes schemes Total schemes schemes Total 2017 2017 2017 2016 2016 2016 £m £m £m £m £m £m Current service cost – – – 0.3 – 0.3 Past service credit (4.3) – (4.3) (5.1) – (5.1) Administration cost 1.0 – 1.0 0.8 – 0.8 Curtailment gain – – – (1.0) – (1.0) Interest cost on benefit obligation 1.3 – 1.3 0.6 – 0.6 Total pension credit (2.0) – (2.0) (4.4) – (4.4) In addition to the credit above, in the year ended 31 December 2017, implementation costs of £0.2m (2016: £1.1m) relating to the pension scheme initiatives have also been recognised in Employee costs (Note 7.1). Other comprehensive income/actuarial gains and losses Actuarial gains and losses recognised in the consolidated statement of comprehensive income:

UK Other UK Other schemes schemes Total schemes schemes Total 2017 2017 2017 2016 2016 2016 £m £m £m £m £m £m Experience gains/(losses) on plan liabilities 14.3 – 14.3 (0.2) (0.2) (0.4) Actuarial (losses) on liabilities due to assumption changes (4.7) – (4.7) (107.4) – (107.4) Experience gains on plan assets 29.6 – 29.6 64.1 – 64.1 Effect of irrecoverable element of pension surplus 0.2 – 0.2 (0.1) – (0.1) Currency translation – – – – (0.2) (0.2) Total gains/(losses) 39.4 – 39.4 (43.6) (0.4) (44.0)

148 UBM Annual Report and Accounts 2017 7.2 Retirement benefit obligations continued Strategic report Guarantees The following guarantees to the Trustees of the UBM Pension Scheme (UBMPS) are in place: 1. A guarantee from UBM plc of all present and future obligations and liabilities of the UBMPS; 2. A guarantee from UBMG Holdings of all present and future obligations and liabilities of the UBMPS up to 105% of the plans’ Pension Protection Fund liabilities less plan assets. This guarantee expires in 2033; and

3. A guarantee from UBMi B.V. of all present and future obligations and liabilities of the UBMPS up to a maximum amount of £37m Governance with this cap reducing by 75 pence for every £1 of deficit contribution paid. This guarantee expires in 2023. 7.3 Share-based payments The Group maintains six share-based payment schemes. Awards granted in three of these schemes have exercise prices (Executive Share Option Scheme and the UK and International Save As You Earn Option Schemes). Awards granted by the other three schemes are nil cost options (Deferred Bonus Plan, Executive Retention Plan and Performance Share Plan). Financial statements Accounting Policy Equity-settled transactions The Group has applied the requirements of IFRS 2 ‘Share-based Payment’ to all grants of equity instruments made after 7 November 2002 that were unvested at 1 January 2005. The cost of equity-settled transactions with employees is measured by reference to the fair value at the grant date of the equity instruments granted. The fair value is measured by an external advisor using the Black-Scholes or Monte Carlo methods as appropriate, and takes into account any market vesting conditions or non-vesting conditions. The cost of equity-settled transactions is recognised as an expense, together with a corresponding increase in equity, over the periods in which the vesting conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (vesting date). At each balance sheet date before vesting, the cumulative expense is calculated, representing the extent to which the vesting period has expired and management’s best estimate of the achievement or otherwise of non-market conditions and of the number of equity instruments that will ultimately vest or, in the case of an instrument subject to a market condition or a non-vesting condition, be treated as vesting as described below. The movement in cumulative expense since the previous balance sheet date is recognised in the income statement, with a corresponding entry in equity. No expense or increase in equity is recognised for awards that do not ultimately vest. Awards where vesting is conditional upon a market or non-vesting condition are treated as vesting irrespective of whether or not the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions (i.e. vesting conditions) are satisfied. When an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation. Any expense not yet recognised for the award is recognised immediately. This includes any award where non-vesting conditions within the control of the entity or the employees are not met. The dilutive effect of outstanding options is reflected in the computation of diluted earnings per share.

Statement of financial Income statement position 2017 2016 2017 2016 £m £m £m £m Equity settled 5.4 6.1 – –

Share based payments – continuing 5.4 5.9 – – Share based payments – discontinued – 0.2 – – Reconciliation of option movements over the year:

ESOS SAYE BIP ERP PSP Number of options m m m m m At 1 January 2017 4.5 1.3 0.2 0.3 2.8 Granted – 0.3 – – 1.1 Forfeited (0.1) (0.1) – – (0.2) Exercised (1.4) (0.2) (0.1) (0.1) (0.5) Expired (0.3) (0.1) – – (0.2) At 31 December 2017 2.7 1.2 0.1 0.2 3.0 Exercisable at 31 December 2017 1.1 – 0.1 – 0.1

UBM Annual Report and Accounts 2017 149 Section 7: Employee Benefits continued

7.3 Share-based payments continued ESOS SAYE BIP ERP PSP Number of options m m m m m At 1 January 2016 9.1 1.5 0.5 0.6 2.0 Granted – 0.5 – 0.1 1.1 Forfeited (0.5) (0.1) – (0.1) – Exercised (3.8) (0.4) (0.2) (0.3) (0.1) Expired (0.3) (0.2) (0.1) – (0.2) At 31 December 2016 4.5 1.3 0.2 0.3 2.8 Exercisable at 31 December 2016 1.5 – 0.2 – –

150 UBM Annual Report and Accounts 2017 Section 8: Other notes

8.1 Group subsidiaries Strategic report The structure of the Group includes a number of different operating, holding and financing companies that contribute significantly to the consolidated financial performance and position.

In accordance with Section 409 of the Companies Act 2006, a full list of subsidiaries, associates and joint ventures as at 31 December 2017 is disclosed below, along with the principal activity, the country of incorporation and the effective percentage of equity owned. With the exception of UBM Ireland No 8 Limited, which is wholly owned by the Company, none of the shares in the

subsidiaries are held directly by the Company. Governance 100% wholly owned events and marketing services companies Country of Registered Name incorporation office Advanstar Communications (UK) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Advanstar Communications Inc US 2711 Centerville Road, Suite 400, Wilmington DE 19808 AMA Research Limited England & Wales 240 Blackfriars Road, London, SE1 8BF

Arabian Exhibition Management Limited Bahrain Building 1, Road 22, Block 414, Al-Daih, PO Box 20200, Jidhafs, Bahrain Financial statements Bangkok Exhibition Services Ltd Thailand 252 SPE Tower, 9th Floor, Phaholyothin Road, Samsennai, Phayathai, Bangkok, Thailand Canon Communications (France) Inc. US 2711 Centerville Road, Suite 400, Wilmington DE 19808 CBI Research Inc. US 2711 Centerville Road, Suite 400, Wilmington DE 19808 China International Exhibitions Services Limited China Room 2402, Singular Mansion, 318-322 Xian Xia Lu, Shanghai, 200336, China CMP Media GmbH Germany Prielmayerstr. 3, c/o Rüter und Partner Steuerberatungsgesellschaft, 80335 München DSA Exhibition and Conference SDN BHD Malaysia Unit 30-01, Level 30, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No.8 Jalan Kerinchi, 59200 ENK International LLC US 2711 Centerville Road, Suite 400, Wilmington DE 19808 Green Thinking (Services) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Hong Kong Exhibition Services Limited Hong Kong Unit 1203, 12/F Harcourt House, 39 Gloucester Road, Wanchai, Hong Kong International Expo Management (Pte) Limited Singapore 10 Kallang Avenue, #09-15, Aperia, 339510, Singapore Malaysian Exhibition Services SDN BHD Malaysia Unit 30-01, Level 30, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No.8 Jalan Kerinchi, 59200 Miller Freeman (Israel) Limited Israel Silver Building, Suite 112-115, 7 Abba Hillel Street, Ramat Gan 52522, Israel Myanmar Trade Fair Management Company Myanmar Apt G-201, Pun Hlaing Golf Estate, Hlaing Tharyar Township, Yangon Limited OES Exhibitions Limited England & Wales 4th Floor, Venture House, 27-29 Glasshouse St, London, W1B 5DF PT Pamerindo Indonesia Indonesia Wisma GKBI, LT.39, Suite 3901, Jalan Jenderal Sudirman No.28, Jakarta Pusat 10210 Seatrade Communications Ltd England & Wales 240 Blackfriars Road, London, SE1 8BF Seatrade Communications Singapore Pte Limited Singapore 10 Hoe Chiang Road, 20-05 Keppel Towers, Singapore 089315 SES Vietnam Exhibition Services Company Limited Vietnam 10th Floor, Ha Phan Building, 17-17A-10, Ton That Tung Street, District, HCMC, Vietnam Sienna Interlink Comunicacoes Ltda Brazil Alameda Tocatins, 75, Sala 1402, Edificio West Gate, Alphaville, Barueri, CEP 06455-020, SAO PAULO, Brazil Singapore Exhibition Services (Pte) Limited Singapore 80 Robinson Road, #02-00,068898 Singapore Smarter Shows (Power) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Think Services Game Group Germany GmbH Germany Kaiser-Wilhelm-Str. 30, 12247, Berlin UBM (UK) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Asia BV Netherlands Coengebouw, Kabelweg 37, 1014 BA Amsterdam UBM Asia Group Limited Hong Kong 17/F, China Resources Building, 26 Harbour Road, Wanchai UBM Asia Limited Hong Kong 17/F, China Resources Building, 26 Harbour Road, Wanchai UBM Asia Partnership Hong Kong Room 703, Silvercord, Tower 2, 30 Canton Road, Tsimshatsui, Hong Kong UBM Asia (Thailand) Co Limited Thailand 503/23 K.S.L Tower, 14th Floor Sri Ayuthaya Road, Kwaeng Thanon Phyathai, Khet Rajathewee, Bangkok 10400, Thailand UBM Brazil Feiras e Eventos Ltda Brazil Alameda Tocatins, 75, Sala 1401, Edificio West Gate, Alphaville, Barueri, CEP 06455-020, SAO PAULO UBM Canon Deutschland GmbH Germany Friedensplatz 13, 53721, Siegburg

UBM Annual Report and Accounts 2017 151 Section 8: Other notes continued

8.1 Group subsidiaries continued 100% wholly owned events and marketing services companies

Country of Registered Name incorporation office UBM Canon Europe Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Canon LLC US 2711 Centerville Road, Suite 400, Wilmington DE 19808 UBM China (Beijing) Co. Limited China Unit 01-02, 12/F, Tower A, Park View Green, 9 Dongdaqiao Road, Chaoyang District, Beijing 100020 UBM China (Beijing) Exhibition Company Limited China Unit 01-02, 12/F, Tower A, Park View Green, 9 Dongdaqiao Road, Chaoyang District, Beijing 100020 UBM India Private Limited India Unit No. 1&2, Times Square, Andheri Kurla Road, Marol, Andheri East, Mumbai, 400 059 UBM Korea Corporation Republic of Korea 8F, Woodo Building, 129-3 Sangbong-dong Chungnang-gu, Seoul UBM LLC US 2711 Centerville Road, Suite 400, Wilmington DE 19808 UBM Media Co Limited Japan Kanda 91 Building, 1-8-3 Kajicho, Chiyoda-ku, Tokyo 101-0044 UBM Medica Group LLC US 2711 Centerville Road, Suite 400, Wilmington DE 19808 UBM Medica LLC US 2711 Centerville Road, Suite 400, Wilmington DE 19808 UBM Novomania Limited Hong Kong Room 703, Silvercord, Tower 2, 30 Canton Road, Tsimshatsui, Kowloon, Hong Kong UBM Rotaforte Uluslararasi Fuarcolik Turkey Molla Fenari Mah, Bab-i Ali Cad, No:9 K:3-4, Fatih 34120, Istanbul, Turkey UBM South China Limited Hong Kong Room 703 Silvercord, Tower 2, 30 Canton Road, Timshatsui, Kowloon, Hong Kong UBMi BV Netherlands Coengebouw, Kabelweg 37, 1014 BA Amsterdam United Newspapers Publications Limited England & Wales 240 Blackfriars Road, London, SE1 8BF 100% wholly owned group holding companies Country of Registered Name incorporation office CMP Holdings Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg CMP Intermediate Holdings Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg CMPI Group Limited England & Wales 240 Blackfriars Road, London, SE1 8BF CMPI Holdings Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Healthcare Holdings, Inc US 2 Penn Plaza, New York, NY 10121 Hirecorp Limited England & Wales 240 Blackfriars Road, London, SE1 8BF International Exhibition Holdings Limited Bahamas Sassoon House, Shirley Street and Victoria Avenue, Nassau, Island of New Providence, P.O. Box SS-5383 Maypond Holdings Limited Republic of Ireland 68 Merrion Square, Dublin 2 Maypond Limited Republic of Ireland 68 Merrion Square, Dublin 2 Miller Freeman Acquisition Corp US 2711 Centerville Road, Suite 400, Wilmington DE 19808 Rocket Holdings, Inc. US 2711 Centerville Road, Suite 400, Wilmington DE 19808 Spectrum ABM Corp. US 2711 Centerville Road, Suite 400, Wilmington DE 19808 Stormcliff Limited Cyprus 2nd Floor, Sotiri Tofini 4, Agios Athanasios, Limassol 4102 Tanahol Limited Republic of Ireland 68 Merrion Square, Dublin 2 The Builder Group Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Asia Holdings (HK) Limited Hong Kong Room 703, Silvercord, Tower 2, 30 Canton Road, Tsimshatsui, Kowloon, Hong Kong UBM IP Luxembourg Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg UBM Ireland No 6 Limited Republic of Ireland 68 Merrion Square, Dublin 2 UBM Ireland No 8 Limited Republic of Ireland 68 Merrion Square, Dublin 2 UBM Japan Company Limited Japan Kanda 91 Building, 1-8-3 Kajicho, Chiyoda-ku, Tokyo 101-0044 UBM Japan Holdings Company Limited Japan Kanda 91 Building, 1-8-3 Kajicho, Chiyoda-ku, Tokyo 101-0044 UBM Worldwide Group Limited England & Wales 240 Blackfriars Road, London, SE1 8BF United Brazil Holdings Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg United Commonwealth Holdings Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg United Consumer Media Holdings Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg United CP Holdings Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg United News Distribution Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg

152 UBM Annual Report and Accounts 2017 8.1 Group subsidiaries continued Strategic report 100% wholly owned group holding companies

Country of Registered Name incorporation office United Pascal France B.V. Netherlands Coengebouw, Kabelweg 37, 1014 BA Amsterdam United Pascal Holdings B.V. Netherlands Coengebouw, Kabelweg 37, 1014 BA Amsterdam United Professional Media Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg UNM Holdings Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg Governance UNM Overseas Holdings Limited Isle of Man First Names House, Victoria Road, Douglas, Isle of Man, IM2 4DF UPRN 1 SE Netherlands Coengebouw, Kabelweg 37, 1014 BA Amsterdam Vavasseur International Holdings Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg 100% wholly owned group financing companies Country of Registered Name incorporation office ABI Building Data Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Financial statements Blessmyth Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Colonygrove Limited England & Wales 240 Blackfriars Road, London, SE1 8BF DIVX Express Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Ludgate USA LLC US 2711 Centerville Road, Suite 400, Wilmington DE 19808 MAI Luxembourg SE England & Wales 240 Blackfriars Road, London, SE1 8BF Miller Freeman Worldwide Limited England & Wales 240 Blackfriars Road, London, SE1 8BF MWFWAHC Investments Limited Jersey 44 The Esplanade, St Helier, Jersey JE4 9WG MWFWAHC Investments No.2 Limited Jersey 44 The Esplanade, St Helier, Jersey JE4 9WG UBM (GP) No 1 Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Aviation Worldwide Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Finance Inc US 2711 Centerville Road, Suite 400, Wilmington DE 19808 UBM Finance Sarl Luxembourg 17 Boulevard Prince Henri, L-1724 Luxembourg UBM International Holdings SE England & Wales 240 Blackfriars Road, London, SE1 8BF UBM UK LLC US 2711 Centerville Road, Suite 400, Wilmington DE 19808 UBMG Holdings England & Wales 240 Blackfriars Road, London, SE1 8BF UBMG Services Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBMI UAE Jersey Limited Jersey 44 The Esplanade, St Helier, Jersey JE4 9WG United Consumer Media SE England & Wales 240 Blackfriars Road, London, SE1 8BF United Finance Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UNM International Holdings Limited Isle of Man First Names House, Victoria Road, Douglas, Isle of Man, IM2 4DF Wenport Limited Republic of Ireland 68 Merrion Square, Dublin 2 100% wholly owned group management and operation companies Country of Registered Name incorporation office UBM Holdings, Inc US 2711 Centerville Road, Suite 400, Wilmington DE 19808 UBM Investments Inc US 2711 Centerville Road, Suite 400, Wilmington DE 19808 UBM Property Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Property Services Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Shared Services Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBMG Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBMi Princeton LLC US 2 Penn Plaza, New York, NY 10121

UBM Annual Report and Accounts 2017 153 Section 8: Other notes continued

8.1 Group subsidiaries continued 100% wholly owned dormant companies

Country of Registered Name incorporation office Airport Strategy and Marketing Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Air Cargo Management System Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Andrew & Booth Limited England & Wales 240 Blackfriars Road, London, SE1 8BF ASM International Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Aztecgem England & Wales 240 Blackfriars Road, London, SE1 8BF Bank Of Europe England & Wales 240 Blackfriars Road, London, SE1 8BF Barbour Index (Loan Note) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Betterbe England & Wales 240 Blackfriars Road, London, SE1 8BF Building Services Publications Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Chartbay Limited Republic of Ireland 68 Merrion Square, Dublin 2 CMP Information (2004) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF CMP Information Holdings England & Wales 240 Blackfriars Road, London, SE1 8BF CMPi (Summer Furniture Show) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF CMP Maritime Limited England & Wales 240 Blackfriars Road, London, SE1 8BF CMP Media (UK) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF CMP Media Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Crosswall Nominees Limited England & Wales 240 Blackfriars Road, London, SE1 8BF CX Properties Republic of Ireland 68 Merrion Square, Dublin 2 Daltons Weekly Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Daltons.co.uk Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Destinylord Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Diamondmark England & Wales 240 Blackfriars Road, London, SE1 8BF Diamondmark Holdings Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Divinelake Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Donytel Limited Republic of Ireland 68 Merrion Square, Dublin 2 E Commerce Expo Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Einsteincorp Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Farming Press Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Garragie Investments Republic of Ireland 68 Merrion Square, Dublin 2 GNC Media Investments Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Great Tactic Limited Hong Kong Room 703, Silvercord, Tower 2, 30 Canton Road, Tsimshatsui, Kowloon, Hong Kong Hickdale Limited Republic of Ireland 68 Merrion Square, Dublin 2 Hoursearch Cardiff Investments Limited England & Wales 240 Blackfriars Road, London, SE1 8BF IFSSEC Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Insight Media Limited England & Wales 240 Blackfriars Road, London, SE1 8BF International Business Events Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Ithaca Media Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Kingsway Collections Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Kuben Holding B.V. Netherlands Coengebouw, Kabelweg 37, 1014 BA Amsterdam Lead-In Research Limited England & Wales 240 Blackfriars Road, London, SE1 8BF MAI England & Wales 240 Blackfriars Road, London, SE1 8BF MAI Brokers (Asia & Pacific) Limited Hong Kong Room 703, Silvercord, Tower 2, 30 Canton Road, Tsimshatsui, Kowloon, Hong Kong MAI Finance Ireland Republic of Ireland 68 Merrion Square, Dublin 2 MAI Holdings Ireland Republic of Ireland 68 Merrion Square, Dublin 2 MAI Holdings Limited England & Wales 240 Blackfriars Road, London, SE1 8BF MAI Luxembourg (UK) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Metro TV Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Metropolitan TV Limited England & Wales 240 Blackfriars Road, London, SE1 8BF MFWWnet Republic of Ireland 68 Merrion Square, Dublin 2

154 UBM Annual Report and Accounts 2017 8.1 Group subsidiaries continued Strategic report 100% wholly owned dormant companies

Country of Registered Name incorporation office Miller Freeman Investments I Limited Jersey 44 The Esplanade, St Helier, Jersey JE4 9WG Miller Freeman Investments II Limited Jersey 44 The Esplanade, St Helier, Jersey JE4 9WG Miller Freeman Online Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Room 703, Silvercord, Tower 2, 30 Canton Road, Tsimshatsui, Kowloon, Governance Mills & Allen Holdings (Far East) Limited Hong Kong Hong Kong Mills & Allen Trading Company Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Mondo Arc Media Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Morgan Grampian (Farming Press) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Mushy Limited England & Wales 240 Blackfriars Road, London, SE1 8BF National Engineering Specification Limited England & Wales 240 Blackfriars Road, London, SE1 8BF NCMR Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Financial statements Nebulamart Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Nexusgrove Investments Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Paramount Publishing Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Property Media Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Research Solutions for Airports Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Roamingtarget Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Roast LLC US 2711 Centerville Road, Suite 400, Wilmington DE 19808 Routes Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Safefine Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Sea Asia Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Security Media Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Sleeper Media Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Smarter Shows (Power) Holdings Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Sportlive.net Holdings Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Springport Republic of Ireland 68 Merrion Square, Dublin 2 Syndicate Nine Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Tartarus Limited England & Wales 240 Blackfriars Road, London, SE1 8BF The Publican Publishing Limited England & Wales 240 Blackfriars Road, London, SE1 8BF The Verecom Group, Inc US 600 Community Drive, Manhasset NY 11030 This Caring Business Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Turtle Diary Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UAP Admin No.6 Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM (GP) No 2 Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM (GP) No 3 Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM (Jersey) Limited Jersey 44 The Esplanade, St Helier, Jersey JE4 9WG UBM Aviation Routes Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Canon UK Holdings Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Canon UK Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Conferences Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Delaware LLC US 2711 Centerville Road, Suite 400, Wilmington DE 19808 UBM Entertainment Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Financial Services Ireland Republic of Ireland 68 Merrion Square, Dublin 2 UBM Holdings Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Investments Unlimited Jersey 44 The Esplanade, St Helier, Jersey JE4 9WG UBM IP Ireland Limited Republic of Ireland 68 Merrion Square, Dublin 2 UBM Ireland No 1 Limited Republic of Ireland 68 Merrion Square, Dublin 2 UBM Ireland No 2 Limited Republic of Ireland 68 Merrion Square, Dublin 2 UBM Ireland No 3 Limited Republic of Ireland 68 Merrion Square, Dublin 2 UBM Ireland No 4 Limited Republic of Ireland 68 Merrion Square, Dublin 2 UBM Medica Holding France SNC France 21/23, rue Camille Desmoulins, 92130 Issy les Moulineaux

UBM Annual Report and Accounts 2017 155 Section 8: Other notes continued

8.1 Group subsidiaries continued 100% wholly owned dormant companies

Country of Registered Name incorporation office UBM Property Investments Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Shelfco No.9 Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Trustees Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBM Unity No 8 Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UBMA Holdings Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UN Acquisitions (Hong Kong) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UN Financial Investments Limited England & Wales 240 Blackfriars Road, London, SE1 8BF United Advertising Publications Limited England & Wales 240 Blackfriars Road, London, SE1 8BF United Business Information (UK) Limited England & Wales 240 Blackfriars Road, London, SE1 8BF United Consumer Magazines Limited England & Wales 240 Blackfriars Road, London, SE1 8BF United Delaware Finance Limited England & Wales 240 Blackfriars Road, London, SE1 8BF United Delaware Investments Limited England & Wales 240 Blackfriars Road, London, SE1 8BF United Executive Trustees Limited England & Wales 240 Blackfriars Road, London, SE1 8BF United Finance (Jersey) Unlimited Jersey 44 The Esplanade, St Helier, Jersey JE4 9WG United Jersey Holdings Unlimited Jersey 44 The Esplanade, St Helier, Jersey JE4 9WG United Media Finance Ireland Republic of Ireland 68 Merrion Square, Dublin 2 United Publications Limited England & Wales 240 Blackfriars Road, London, SE1 8BF United Television Investments England & Wales 240 Blackfriars Road, London, SE1 8BF United Trustees Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UNM Finance Ireland Republic of Ireland 68 Merrion Square, Dublin 2 UNM Holdings Ireland Republic of Ireland 68 Merrion Square, Dublin 2 UNM Investments Limited England & Wales 240 Blackfriars Road, London, SE1 8BF UNPI Investment Holdings Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Vavasseur Overseas Holdings Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Wave Exhibitions Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Waters Edge Publishing Limited England & Wales 240 Blackfriars Road, London, SE1 8BF WCN 2 Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Workyard Limited England & Wales 240 Blackfriars Road, London, SE1 8BF Partly owned businesses (50% and more) Country of Principal business Registered Name incorporation activity office APLF Limited Hong Kong Events business Room 812, Silvercord, Tower 1, 30 Canton Road, Tsimshatsui, Kowloon, Hong Kong Cosmoprof Asia Limited Hong Kong Events business 17/F China Resources Building, 26 Harbour Road, Wanchai, Hong Kong, China Eco Exhibitions Sdn Bhd Malaysia Events business Unit 30-01, Level 30, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No 8, Jalan Kerinchi 59200 Kuala Lumpur, Malaysia Navalshore Organizacao de Eventos Limiteda Brazil Events business Centro de Apolo II, Alphaville, Santana de Parnaiba, Sao Paulo, 06541-060, Brazil PT UBM Pameran Niaga Indonesia Indonesia Events business Jalan Sultan Iskandar Muda, No 7 Arteri Pondok Indah, Kebayoran Lama, Jakarta Selantan, 12240 Indonesia Sea Asia Singapore Pte Limited Singapore Events and 10 Hoe Chaing Road, 20-05 Keppel Towers, marketing Singapore 089315 services business Shanghai Expobuild International Exhibition China Events business Room 1019, 39 Weigaojiao, Shanghai Company Limited Shanghai UBM Showstar Exhibition Co Limited Events business 9/F Ciro's Plaza, 388 West Nanjing Road, Huangpu District, Shanghai, 200003 China Shanghai UBM Sinoexpo International Exhibitions China Events business 6-8/F Xian Dai Mansion, 218 Xiang Yang Road (S), Company Limited Shanghai 200031, China Shenzhen UBM Herong Exhibition Company China Events business Room 607, East Block, Coastal Building, Haide 3rd Road, Nanshan District, Shenzhen, Guangdong 518054, China 156 UBM Annual Report and Accounts 2017 8.1 Group subsidiaries continued Strategic report Partly owned businesses (50% and more)

Country of Principal business Registered Name incorporation activity office The Property Week Limited England & Wales Marketing services 240 Blackfriars Road, London, SE1 8BF business UBM BN Co. Ltd Republic of Korea Events business 8F, Woodo Building, 214 Mangu-ro, Jungnang-gu, Seoul 02121, Republic of Korea Governance UBM Exhibitions Philippines Inc Phillipines Events business Unit I-121, Ground Floor, OneE-com Center, Ocean Drive, Mall of Asia Complex, 1300 Pasay City, Metro Manila UBM I C C Fuarcilik ve Organizasyon Ticaret A.S Turkey Events business Rüzgarlıbaçe Mah. Kavak Sok, Smart Plaza B Blok, No: 31/1 Kat:8, 34805 Kavacık-Beykoz, Istanbul, Turkey UBM Istanbul Fuarcilik ve Gosteri Hizmetleri A.S Turkey Events business Rüzgarlıbaçe Mah. Kavak Sok, Smart Plaza B Blok, No: 31/1 Kat:8, 34805 Kavacık-Beykoz, Istanbul, Financial statements Turkey UBM Mexico Exposiciones, S.A.P.I. Mexico Events business Av. Benjamin Franklin 235-4, Mexico DF06100 UBM NTSR Fuar ve Gosten Hizmetleri A.S Turkey Events business Rüzgarlıbaçe Mah. Kavak Sok, Smart Plaza B Blok, No: 31/1 Kat:8, 34805 Kavacık-Beykoz, Istanbul, Turkey UBM SinoExpo Limited Hong Kong Events and 7/8 , Urban Development International Tower, No. marketing services 355 Hong Qiao Road, Xu Hui District, Shanghai business 200030, China UBM Trust Company Limited China Events business Room 1806-1807, Fu Li Tian He Business Mansion, No. 4, Hua Ting Road, Lin He Dong Road, Guangzhou 510610, China UBMMG Holdings Sdn Bhd Malaysia Holding company Unit 30-01, Level 30, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No 8, Jalan Kerinchi 59200 Kuala Lumpur, Malaysia United Business Media (M) Sdn Bhd Malaysia Events and Level 18, The Gardens North Tower, Mid Valley marketing City, Lingkaran Syed Putra, 59200 Kuala Lumpur, services business Malaysia Joint ventures and associates (20%–50%) Country of Principal business Registered Name incorporation activity office Cosmoprof Shanghai Exhibitions Limited China Events Business 10/F Xian Dai Mansion, 218 Xiangyang Road, Shanghai, 200031, China Games for Good Causes plc Thailand Events business 503/23 K.S.L Tower, 14th Floor Sri Ayuthaya Road, Kwaeng Thanon Phyathai, Khet Rajathewee, Bangkok 10400, Thailand GML Exhibition (Thailand) Co. Ltd China Dormant Room 405 Parkview Square, 960 Jie Fang Bei Road, Guangzhou 510040, China Guangdong International Exhibitions Limited China Events and 2F, Guzhen Convention & Exhibition Center, marketing Zhongshan, Guangdong, China services business Guzhen Lighting Expo Co., Ltd China Events and 2F, Guzhen Convention & Exhibition Center, marketing Zhongshan, Guangdong, China services business Independent Television News Limited (ITN) England & Wales Broadcasting 200 Grays Inn Road, London, WC1X 8XZ business PT Dyandra UBM International Indonesia Events business JI. Johar No.9, Kelurahan Gondangdia, Menteng, Jakarta Pusat, Indonesia

UBM Annual Report and Accounts 2017 157 Section 8: Other notes continued

8.2 Related party transactions Transactions with related parties are made at arm’s length. Outstanding balances at year-end are unsecured and settlement occurs in cash. There are no bad debt provisions for related party balances as at 31 December 2017, and no debts due from related parties have been written off during the year. Unless otherwise stated, there are no amounts owed by or due to the Group at 31 December 2017. The Group entered into the following transactions with related parties during the year:

Balances Balances (owed by)/ (owed by)/ due to due to the Group at Value of the Group at Value of 31 December transactions 31 December transactions 2017 2017 2016 2016 Related party and Relationship Nature of transactions £m £m £m £m GML Exhibitions (Thailand) Co Limited – Dividend income, advances and management Joint Venture fees – –1 – –1 Guzhen Lighting Expo Company Limited – Joint Venture Dividend income and marketing expenses – – –2 0.5 1 The Group received a dividend of £37,000 from GML Exhibitions (Thailand) Co Limited and is owed nil as at 31 December 2017 (2016: £52,000). 2 The Group was owed £7,000 by Guzhen Lighting Expo Company Limited at 31 December 2016.

Compensation of key management personnel of the Group Key management personnel are the Group’s Executive Directors and Non-Executive Directors and the following is the aggregate compensation of these Directors:

2017 2016 £m £m Short term employee benefits 2.9 2.6 Contributions to defined contribution plans 0.2 0.2 Share-based payments 2.2 2.1 5.3 4.9 8.3 Events after the reporting period On 4 January 2018, the owners of the 15% non-controlling interest of UBM ICC Fuarcilik ve Organizasyon Ticaret A.Ş (ICC) issued a binding notice to exercise their put option. Consideration for this remaining 15% shareholding is in negotiation and will not be material to the Group. The equity purchase will take the Group’s total shareholding in ICC to 100%. On 26 January 2018, the Group completed the disposal of the Building, Building Design portfolio and venuefinder.com business for total consideration of £3.0m comprised of cash and vendor loan notes. On 30 January 2018, Informa plc made a formal offer, which has been recommended by the UBM Board of Directors, to acquire the Group for a value of approximately £3.9bn. On 12 February 2018, the Group acquired 65% of 博闻创意会展（深圳）有限公司, organiser of Shenzhen International Electronics Convention & Expo and the Shenzhen International e-Cig Expo, for initial consideration of £4.6m On 23 February 2018, the Group completed the disposal of the Accent, Forum and MR fashion media portfolios for consideration of $515,000 On 27 February 2018, the Group acquired 100% of Centro De Treinamento E Estudos Em Energia Ltda, which owns a portfolio of renewable energy events and digital media in Brazil, for initial consideration of £5.0m.

158 UBM Annual Report and Accounts 2017 Additional information

Five year summary Strategic report

2017 2016 2015 2014 2013 £m £m m m m Profit and loss account Revenue1 1,002.9 966.0 974.6 746.3 818.2 Adjusted profit before tax1, 2 268.8 236.6 219.5 157.6 162.7 Profit/(loss) before tax1 199.5 530.2 137.7 145.2 128.8

Profit/(loss) for the year 159.5 504.5 107.7 160.1 117.0 Governance

Earnings per share4 Adjusted1,3 54.0p 46.4p 40.8p 38.6p 42.7p Basic 37.1p 118.5p 21.8p 46.4p 34.1p

Ordinary dividends (paid and proposed)4 23.5p 22.0p 21.6p 21.3p 21.1p Financial statements 1 Including continuing and discontinued operations. 2 Before amortisation of intangible assets arising on acquisitions, exceptional items, share of tax on profit from joint ventures and associates and net financing expense adjustments. 3 Adjusted earnings (net profit for the year attributable to owners of the parent entity, before amortisation of intangible assets arising on acquisitions, movements on deferred tax balances recognised as a consequence of acquisition intangibles, exceptional items, tax relating to exceptional items and net financing expense adjustments) divided by the weighted average number of ordinary shares outstanding during the year. 4 Historic amounts have been restated to reflect the impact of the rights issue done on 12 December 2014 only. Historic amounts have not been restated following the share consolidation on 27 June 2016 as it was coupled with the payment of the special dividend. Exchange rates The most significant exchange rates to UK sterling for the Group that have been used in the Group consolidated financial statements are:

Closing rate Average rate Closing rate Average rate 2017 2017 2016 2016 £m £m £m £m Euro 1.1256 1.1268 1.1690 1.2191 US dollar 1.3516 1.2846 1.2344 1.3431 Chinese renminbi 8.7924 8.8244 8.5927 8.9315

UBM Annual Report and Accounts 2017 159 Parent company income statement for the year ended 31 December 2017

2017 2016 Notes £m £m Other income 6.0 5.8 Operating expenses (8.2) (5.6) 3 Operating profit/(loss) (2.2) 0.2 4 Net financing income/(expense) 23.4 (61.8) Profit/(loss) on ordinary activities before tax 21.2 (61.6) 5 Tax on loss on ordinary activities – – Profit/(loss) for the financial year 21.2 (61.6) The Company has no recognised gains and losses other than those included in the profit and loss account and therefore no separate statement of other comprehensive income has been presented.

160 UBM Annual Report and Accounts 2017 Parent company balance sheet at 31 December 2017

2017 2016 Strategic report Notes £m £m Non-current assets 7 Tangible assets 21.7 24.1 8 Investments in subsidiaries 1,600.1 1,594.7 1,621.8 1,618.8 Current assets

9 Trade and other receivables 888.8 600.1 Governance Cash at bank and in hand – – 888.8 600.1

Current liabilities 10 Trade and other payables (1,281.0) (1,171.8) Net current liabilities (392.2) (571.7) Financial statements

Totals assets less current liabilities 1,229.6 1,047.1

Non-current liabilities 11 Borrowings (529.9) (280.6)

Net assets 699.7 766.5

Capital and reserves 12 Share capital 44.3 44.3 Share premium account 536.0 535.3 ESOP reserve (5.1) (5.9) Retained earnings 124.5 192.8 Total equity shareholders’ funds 699.7 766.5 These financial statements were approved by the Board of Directors and were signed on its behalf on 27 February 2018 by:

Marina Wyatt Director

UBM Annual Report and Accounts 2017 161 Parent company statement of changes in equity at 31 December 2017

Share Share premium ESOP Retained capital account reserve earnings Total £m £m £m £m £m At 1 January 2016 44.3 534.7 (7.8) 593.3 1,164.5 Loss for the year – – – (61.6) (61.6) Issued in respect of share option schemes and other entitlements – 0.6 – – 0.6 Dividends paid – – – (336.7) (336.7) Shares awarded by ESOP – – 26.3 (26.3) – Own shares purchased by the Company – – (24.4) 18.0 (6.4) Equity granted to employees of subsidiaries – – – 6.1 6.1 At 31 December 2016 44.3 535.3 (5.9) 192.8 766.5 Profit for the year – – – 21.2 21.2 Issued in respect of share option schemes and other entitlements – 0.7 – – 0.7 Dividends paid – – – (86.9) (86.9) Shares awarded by ESOP – – 14.7 (14.7) – Own shares purchased by the Company – – (13.9) 6.7 (7.2) Equity granted to employees of subsidiaries – – – 5.4 5.4 At 31 December 2017 44.3 536.0 (5.1) 124.5 699.7

162 UBM Annual Report and Accounts 2017 Notes to the parent company financial statements at 31 December 2017

1. Basis of preparation Strategic report The separate financial statements of the Company are presented in compliance with the requirements for companies whose shares are listed on the London Stock Exchange. They have been prepared on a going concern basis, under the historical cost convention and in accordance with the Companies (Jersey) Law 1991 and United Kingdom Accounting Standards, including Financial Reporting Standard 101 ‘Reduced Disclosure Framework’ (FRS 101). The Company financial statements were approved by the Board of Directors for issue on 27 February 2018. The Company meets the definition of a qualifying entity under FRS 100 (Financial Reporting Standard 100) issued by the Financial

Reporting Council. Accordingly, financial statements for the year ended 31 December 2017 were prepared in accordance with FRS 101. Governance The amendments to FRS 101 (2016/17 Cycle) issued in July 2017 have been adopted early. In preparing these financial statements, the Company applies the recognition, measurement and disclosure requirements of FRS 101. In these financial statements, the Company has applied the exemptions available under FRS 101 in respect of the following disclosures: −− Cash Flow Statement and related notes;

−− Comparative period reconciliations for share capital, tangible fixed assets, intangible assets and investment properties; Financial statements −− Related party disclosures in respect of transactions with wholly owned subsidiaries; −− Disclosures in respect of capital management; −− The effects of new but not yet effective IFRSs; −− An additional balance sheet for the beginning of the earliest comparative period following the retrospective change in accounting policy, the correction of error, or the reclassification of items in the financial statements; and −− Disclosures in respect of the compensation of Key Management Personnel. As the consolidated financial statements of UBM plc include the equivalent disclosures, the Company has also taken the exemptions under FRS 101 available in respect of the following disclosures: −− IFRS 2 ‘Share Based Payments’ in respect of group settled share based payments; −− Certain disclosures required by IAS 36 ‘Impairment of assets’ in respect of the impairment of goodwill and indefinite life intangible assets; −− Disclosures required by IFRS 5 ‘Non-current Assets Held for Sale and Discontinued Operations’ in respect of the cash flows of discontinued operations; −− Certain disclosures required by IFRS 3 ‘Business Combinations’ in respect of business combinations undertaken by the Company in the current and prior periods including the comparative period reconciliation for goodwill; and −− The disclosures required by IFRS 7 ‘Financial Instruments: Disclosures’ and IFRS 13 ‘Fair Value Measurement’ regarding financial instrument disclosures have not been provided apart from those which are relevant for the financial instruments which are held at fair value and are not either held as part of trading portfolio or derivatives. The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these financial statements. 2. Significant accounting policies Foreign currencies Foreign currency transactions arising from operating activities are translated from local currency into pounds sterling at the exchange rates prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the year end are translated at the period end exchange rate. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Foreign currency gains or losses are credited or charged to the profit and loss account as they arise. Investments Investments in subsidiaries are stated at cost less any provision for impairment. The Company reviews investments for impairment if events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company assesses whether such indicators exist at each reporting date. If any such indication of impairment exists, the Company makes an estimate of the recoverable amount. Where the recoverable amount of the investment is less than the carrying amount, an impairment is recognised immediately in the profit and loss account.

UBM Annual Report and Accounts 2017 163 Notes to the parent company financial statements continued at 31 December 2017

2. Significant accounting policies continued Financial instruments Financial instruments in the scope of IAS 39 ‘Financial Instruments: Recognition and Measurement’ are classified as either financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, or available-for-sale financial assets, as appropriate. Financial liabilities in the scope of IAS 39 are classified as financial liabilities at amortised cost (borrowings, amounts owed to subsidiaries and other creditors). When financial instruments are recognised initially, they are measured at fair value, and in the case of investments not at fair value through profit or loss, after taking account of directly attributable transaction costs. All bank and other loans are initially recognised at fair value, being the fair value of the consideration received net of issue costs associated with the loans. After initial recognition, bank and other loans are subsequently measured at amortised cost and any difference between the proceeds and redemption value is recognised in the income statement using the effective interest method. Amortised cost is calculated by taking into account any issue costs and any discount or premium on settlement. Deferred tax Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or events have occurred at that date that will result in an obligation to pay more, or a right to pay less or to receive more, tax, with the following exceptions: −− provision is made for taxable gains arising from the revaluation (and similar fair value adjustments) of fixed assets that have been rolled over into replacement assets, only to the extent that there is a binding agreement to dispose of the assets concerned. However no provision is made where, on the basis of all available evidence at the balance sheet date, it is more likely than not that the taxable gain will be rolled over into replacement assets and charged to tax only where the replacement assets are sold; −− provision is made for deferred tax that would arise on remittance of the retained earnings of overseas subsidiaries, associates and joint ventures only to the extent that, at the balance sheet date, dividends have been accrued as receivable; and −− deferred tax assets are recognised only to the extent that the Directors consider that it is more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted. Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the period on which timing differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date. Tangible fixed assets Tangible fixed assets are stated at cost less depreciation and impairment losses. Depreciation is provided on all items except freehold land. Depreciation rates are calculated so that assets are written down to the residual value in equal annual instalments over their expected useful lives, which are as follows: Freehold buildings and long leasehold property Up to 70 years Leasehold improvements Term of lease General plant, machinery and equipment 5-20 years Computer equipment 3-5 years An item of tangible fixed asset is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the item is included in the income statement in the year the asset is derecognised. The residual values, useful lives and methods of depreciation of the assets are reviewed, and adjusted if appropriate, at each financial year end. Tangible fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. Share-based payments Where a parent company grants rights to its equity instruments to employees of a subsidiary, and such share-based compensation is accounted for as equity-settled in the consolidated financial statements of the parent, the subsidiary is required to record an expense for such compensation in accordance with IFRS 2 ‘Share-based payments’, with a corresponding increase recognised in equity as a contribution from the parent. Consequently, the Company has recognised an addition to investments in subsidiaries of the aggregate amount of these contributions that accrued in the year of £5.4m (2016: £6.1m) with a corresponding credit to equity shareholders’ funds. Full details of share-based payments transactions are provided in Note 7.3 of the Group financial statements. Operating leases Payments (excluding costs for services and insurance) made under operating leases are recognised in the profit and loss account on a straight-line basis over the term of the lease. Lease incentives received are recognised in the profit and loss account as an integral part of the total lease expense. Rental income arising from operating leases is recognised on a straight line basis over the lease term. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income.

164 UBM Annual Report and Accounts 2017 3. Operating profit/(loss) Strategic report Operating profit/(loss) is stated after crediting/charging: (i) Other income 2017 2016 £m £m Rental income 5.9 4.9 Other income 0.1 0.9 Governance 6.0 5.8 Rental income is received from UBMG Limited under a sub-lease arrangement made at arm’s length. (ii) Staff costs 2017 2016 £m £m Directors’ fees 0.7 0.7

Wages and salaries – – Financial statements 0.7 0.7 The Company did not have any employees during the year (2016: nil). Executive Directors of the Company are employed by other companies within the Group. Details of the remuneration of executive and non-executive Directors’ remuneration and their interest in shares and options of the Company are given in the audited part of the Directors’ Remuneration Report on pages 68 to 86. (iii) Auditor’s remuneration The auditor’s remuneration for audit services to the Company was £19,840 (2016: £19,840). Fees paid to Ernst & Young LLP and its associates for non-audit services to the Company are disclosed in the UBM plc consolidated financial statements. (iv) Minimum lease payments recognised as an operating lease expense During the year, £3.1m was recognised as an expense in the profit and loss account in respect of operating leases (2016: £3.5m). 4. Net financing income/(expense)

2017 2016 £m £m Net interest income/(expense): Bank and other loans (1.7) (15.1) Net foreign exchange gain/(loss) 25.1 (46.7) 23.4 (61.8)

UBM Annual Report and Accounts 2017 165 Notes to the parent company financial statements continued at 31 December 2017

5. Tax on profit/(loss) for the year The reconciliation of the current tax charge for the year is as follows:

2017 2016 £m £m Profit/(loss) on ordinary activities before tax 21.2 (61.6)

Profit/(loss) on ordinary activities before tax multiplied by the applicable rate of corporation tax in the UK of 19.25% (2016: 20.0%) 4.1 (12.3) Effects of: Expenses not deductible for tax purposes – 9.7 Non-taxable income (4.8) – Group relief surrendered for nil consideration 0.7 2.6 – – The Company has unused tax losses of £60.1m (2016: £41.6m) for which no deferred tax assets have been recognised as it is uncertain that these losses will be utilised. 6. Dividends

2017 2016 £m £m Declared and paid during the year Equity dividends on ordinary shares Final dividend for 2016 of 16.6p (2015: 16.3p) 65.3 71.8 Special dividend for 2016: 55.3p – 243.7 Interim dividend for 2017 of 5.5p (2016: 5.4p) 21.6 21.2 86.9 336.7 The Directors propose a final dividend of 18.0 pence (2016: 16.6 pence) per ordinary share for the year ended 31 December 2017. This dividend is not included as a liability in the current year financial statements as it was not announced before 31 December 2017. There are no income tax consequences to the Company arising from the payment of dividends to its shareholders. 7. Tangible assets 31 December 2017 Plant, Leasehold machinery improvements and vehicles Total £m £m £m Cost At 1 January 25.8 2.9 28.7 Additions – 0.1 0.1 At 31 December 2017 25.8 3.0 28.8 Depreciation At 1 January 3.4 1.2 4.6 Charge for the year 1.8 0.7 2.5 At 31 December 2017 5.2 1.9 7.1 Carrying amount At 1 January 2017 22.4 1.7 24.1 At 31 December 2017 20.6 1.1 21.7

166 UBM Annual Report and Accounts 2017 8. Investments in subsidiaries Strategic report

Shares in Shares in Group Group companies companies 2017 2016 £m £m Cost At 1 January 1,733.3 1,727.2

Additions 5.4 6.1 Governance At 31 December 1,738.7 1,733.3 Impairment At 1 January 138.6 138.6 Charge for the year – – At 31 December 138.6 138.6 Carrying amount

At 1 January 1,594.7 1,588.6 Financial statements At 31 December 1,600.1 1,594.7 Additions in the year ended 31 December 2017 comprised the fair value of the share incentives issued to employees of subsidiaries during the year of £5.4m (2016: £6.1m). The cumulative amount of share incentives issued to employees recognised in investments in subsidiaries is £41.0m (2016: £35.6m). Details of the investments in subsidiaries and joint ventures and associates that are held by the Company are detailed in Notes 8.1 and 4.4 of the Group financial statements respectively. 9. Trade and other receivables

2017 2016 £m £m Amounts falling due within one year: Amounts owed by group undertakings 886.5 599.6 Other receivables 2.3 0.5 888.8 600.1 10. Trade and other payables

2017 2016 £m £m

Amounts owed to group undertakings 1,262.5 1,153.1 Other payables 18.5 18.7 1,281.0 1,171.8 Amounts owed to group undertakings falling due within one year are unsecured, interest free and repayable on demand. Fair value is not different from the carrying amounts. 11. Borrowings

2017 2016 £m £m $370m US Private Placement Loan Notes 273.0 – $350m 5.75% dollar bonds due 2020 256.9 280.6 529.9 280.6 Terms of the $370m US Private Placement Loan Notes and $350m 5.75% dollar bonds due 2020 are provided in Note 5.3 to the Group financial statements. In the Company financial statements the bond and Loan Notes are carried at amortised cost as it is not subject to the consolidated hedging arrangements detailed in Note 5.5 to the Group financial statements.

UBM Annual Report and Accounts 2017 167 Notes to the parent company financial statements continued at 31 December 2017

12. Called up share capital

2017 2016 £m £m Authorised 1,081,888,657 ordinary shares of 11.25p each 121.7 121.7

Ordinary Ordinary Shares Shares Issued and fully paid Number £m At 1 January 2016 442,977,538 44.3 Issued in respect of share option schemes and other entitlements prior to the share consolidation 5 – Share consolidation (49,219,727) – Issued in respect of share option schemes and other entitlements 151,042 – At 31 December 2016 393,908,858 44.3 Issued in respect of share option schemes and other entitlements after the share consolidation 179,302 – At 31 December 2017 394,088,160 44.3 On 27 June 2016, in conjunction with the special dividend of 55.3p per share, a share consolidation was carried out to convert nine existing ordinary shares with a nominal value of 10p each to eight new ordinary shares with a nominal value of 11.25p each. The share consolidation converted the 442,997,543 existing issued and fully paid ordinary shares into 393,757,816 new issued and fully paid ordinary shares. Company share schemes ESOP reserve The ESOP Trust owns 0.19% (2016: 0.21%) of the issued share capital of the Company in trust for the benefit of employees of the Group and their dependents. The ESOP Trust waives its dividend entitlement and abstains from voting at general meetings. The ESOP reserve records ordinary shares held by the ESOP to satisfy future share awards. The shares are recorded at cost. During the year ended 31 December 2017, 1,915,285 shares were purchased by the ESOP (2016: 3,787,951 shares) at a cost of £13.9m (2016: £24.4m). The Company received contributions of £6.7m (2016: £18.0m) from employees relating to the exercise price of share options and awards granted in prior years. In accordance with IAS 33, the prior period weighted average number of shares has not been restated as the share consolidation was coupled with the payment of the special dividend.

168 UBM Annual Report and Accounts 2017 13. Operating lease payments Strategic report Company as lessee Annual commitments under non-cancellable operating leases are as follows:

Land and Land and buildings buildings 2017 2016 £m £m Within 1 year 4.9 3.7 Governance Later than 1 year and not later than 5 years 19.7 19.7 Later than 5 years 30.8 35.8 55.4 59.2 Company as lessor Annual commitments under non-cancellable operating leases are as follows:

Land and Land and

buildings buildings Financial statements 2017 2016 £m £m Within 1 year 4.9 4.9 Later than 1 year and not later than 5 years 19.7 19.7 Later than 5 years 30.8 35.8 55.4 60.4 14. Contingent liabilities The Company acts as guarantor over a net overdraft facility of £30.0m, and the £400m syndicated revolving credit facility that are available to certain subsidiaries. The Company also acts as guarantor on interest rate swaps taken out by a subsidiary and on foreign exchange transactions undertaken by subsidiaries. The Company acts as guarantor of the liabilities of the UBM Pension Scheme. 15. Related party transactions The Directors of the Company had no material transactions with the Company or its subsidiaries during the year other than their director fee arrangement as detailed in the Directors’ Remuneration Report. The Company has taken advantage of the exemption that transactions with wholly owned subsidiaries do not need to be disclosed.

UBM Annual Report and Accounts 2017 169 Explanation of non-IFRS measures

Financial measure How we define it Why we use it Underlying revenue and underlying Underlying measures are adjusted for Underlying growth rates provide insight into operating profit the effects of acquisitions, disposals, the organic growth of the business foreign exchange movements, phasing and peripatetic and biennial events. Adjusted underlying also removes the impact of portfolio rationalisation Adjusted operating profit Operating profit excluding amortisation of Provides insight into ongoing profit intangible assets arising on acquisitions, generation, individually and relative to other exceptional items and share of taxation on companies joint ventures and associates Margin Adjusted operating profit expressed as a percentage of revenue EBITDA Earnings before interest, tax, depreciation, Measure of earnings and cash generative amortisation and exceptional items capacity Adjusted profit before tax Profit before tax before amortisation of Facilitates performance evaluation, individually intangible assets on acquisitions, exceptional and relative to other companies items, share of taxation on profit from joint ventures and associates and net financing expense adjustments Adjusted EPS Adjusted basic EPS includes share of taxation on profit from joint ventures and associates but excludes movements on deferred tax balances recognised as a consequence of acquisition intangibles. Adjusted diluted EPS includes the impact of share options Net debt Net debt is current and non-current Measure of indebtedness – includes benefit of borrowings and derivatives associated current cash available to pay down debt with debt instruments, less cash and cash equivalents Free cash flow Net cash provided by operating activities Measure of cash available to repay debt, pay after meeting obligations for interest, tax, dividends and invest in acquisitions capital expenditure and pension deficit payments Adjusted cash generated from operations Adjusted to exclude non-operating Provides an understanding of our operating cash movements in working-capital, such as flows expenditure against reorganisation and restructuring provisions and acquisition and disposal costs Cash conversion Cash conversion is the ratio of adjusted cash generated from operations to adjusted operating profit Return on investment Adjusted post tax incremental operating To assess returns on acquisitions relative to our profit divided by the cost of acquisition cost of capital. The measure adjusts for foreign calculated on a constant currency, biennial exchange movements and incorporates the adjusted, pro forma basis, as if the business incremental operating result of the acquisition. had been owned throughout the year This aligns the measure to our acquisition assessment criteria Return on average capital employed ROACE is post-tax adjusted operating profit Provides a measure of the efficiency of our (ROACE) over average capital employed. Capital capital investment employed is shareholders’ funds plus net debt. Shareholders’ funds is adjusted for cumulative impairment charges from 1 January 2016 Effective tax rate The effective tax rate on adjusted profit Provides a more comparable basis to analyse our before tax reflects the tax rate excluding tax rate movements on deferred tax balances recognised as a consequence of acquisition intangibles

170 UBM Annual Report and Accounts 2017 Shareholder information

UBM plc website Annual General Meeting 2018 Strategic report www.ubm.com The AGM of the Company will be held at 240 Blackfriars Road, London SE1 8BF on Tuesday, 15 May 2018. The meeting will Registration start at 2.00pm and registration will be available from 1.30pm. Jersey Company Number: 100460 (www.jerseyfsc.org/registry) The Notice of Meeting is available on the Company’s website at www.ubm.com/investor/shareholder-information. Share listings The ordinary shares are listed on the London Stock Exchange Dividends Governance under the symbol UBM: www.londonstockexchange.com Dividends are paid in May and October each year. Shareholders are encouraged to have their dividends paid Addresses directly into their bank account. It is a more secure and faster Registered office way to receive the dividend payment, with cleared funds 44 Esplanade available to shareholders on the dividend payment date. St. Helier To take advantage of this convenient method of payment visit Jersey www.shareview.co.uk or contact Equiniti. Details of the 2018

JE4 9WG dividend dates can be found in the Financial Calendar on the Financial statements inside back cover. Corporate Headquarters 240 Blackfriars Road Investor relations London For all investor relations enquiries, please contact our Investor SE1 8BF Relations department at the following link or telephone our Tel: +44 (0)20 7921 5000 Corporate Headquarters (see adjacent details). Registrars E-mail: [email protected] All shareholder enquiries should be made to our Registrars, Website: www.ubm.com/investor Equiniti (Jersey) Limited, quoting UBM’s company reference As well as results presentations, dividends, announcements number 8054, using either the details below or online and reports and accounts, the investor relations page contains via Shareview. financial information including share price information at Equiniti (Jersey) Limited www.ubm.com/investor/share-price-information. c/o Equiniti Limited Aspect House Alerting Service – keep up to date with all the Spencer Road latest news and events Lancing Just follow this link and select the information of interest to you BN99 6DA to receive e-mail notifications www.ubm.com/site-services/sign- Shareholders helplines up-to-alerts Tel: 0371 384 2239* (for callers from the UK) Shareholder profile as at 31 December 2017 Tel: +44 121 415 7002* (for callers from outside the UK) No. of % No. of No. of % of issued Holdings holders holders shares share capital * Lines are open 8:30am to 5:30pm, Monday to Friday (excluding bank holidays) 1–1,000 4,989 76.00 1,345,202 0.34 Manage your shareholding online 1,001–5,000 1,024 15.60 2,108,238 0.54 Shareholders can manage their shareholdings online by 5,001–50,000 300 4.57 5,028,356 1.28 registering with Shareview (www.shareview.co.uk), the internet 50,001–1,000,000 192 2.92 57,825,448 14.67 based platform provided by Equiniti. Registration is easy and allows you to: 1,000,001+ 60 0.91 327,780,916 83.17 Total 6,565 100.00 394,088,160 100.00 −− View your shareholdings −− Update your address and other details −− Buy, sell or transfer shares −− Report a lost certificate −− Elect to receive electronic reports −− Change how you receive dividends −− Receive electronic tax voucher information −− Submit proxy votes online Electronic communications Receiving the Company’s communications electronically allows the Company to communicate with its shareholders in a more environmentally friendly manner which supports our sustainability commitments.

UBM Annual Report and Accounts 2017 171 Shareholder information continued

Warning about unsolicited shareholder contact The market value of UBM’s Ordinary shares of 30 5⁄14p on Shareholders are advised to be extremely wary of any unsolicited 21 June 2005 following the share consolidation was 511.25p. advice, offers to buy shares at a discount or offers of free The market value of UBM’s Ordinary shares of 33 71/88p on reports about the Company. If you receive any unsolicited 20 March 2007 following the share consolidation was 805.0p. advice, make sure you get the correct name of the person and organisation and check that they are appropriately authorised The market value of UBM’s Ordinary shares of 10p each on by the FCA by visiting www.fca.org.uk. More information on 12 December 2014 following the Rights Issue was 452.90p. protecting your investment can be found at www.fca.org.uk/ The market value of UBM’s Ordinary shares of 11.25p on 27 June consumers/share-fraud-boiler-room-scams 2016 following the 8 for 9 share consolidation was 580.50p. If you do receive a fraudulent approach, please advise the FCA Financial calendar 2018 using the share fraud reporting form at www.fca.org.uk/scams or call the FCA Consumer Helpline on 0800 111 6768. Ex-dividend date for 2017 final dividend 19 April 2018 Record date for 2017 final dividend 20 April 2018 Further details can be found on our website at www.ubm.com/ investor/shareholder-information. Annual General Meeting 15 May 2018 Final dividend for 2017 payment date 24 May 2018 Tips on protecting your shares Announcement of interim results for 2018 26 July 20181 −− Keep any documentation that contains your shareholder Ex-dividend date for 2018 interim dividend 6 September 20181 reference number in a safe place and destroy any Record date for 2018 interim dividend 7 September 20181 documentation you no longer require by shredding it Interim dividend for 2018 payment date 11 October 20181 −− Inform Equiniti promptly when you change your address 1 Provisional dates −− Be aware of dividend payment dates and contact Equiniti if Cautionary statement you do not receive your dividend cheque, or better still, make This Annual Report and Accounts has been prepared for, and arrangements to have the dividend paid directly into your only for, the members of UBM plc (the Company), as a body, bank account and no other persons. The Company, its Directors, employees, −− Consider holding your shares electronically in a CREST agents or advisers do not accept or assume responsibility to any account via a nominee other person to whom this document is shown or into whose hands it may come and any such responsibility or liability is ShareGift expressly disclaimed. By their nature, the statements concerning The Company supports ShareGift, the charity share donation the risks and uncertainties facing the Group in this Annual scheme administered by The Orr Mackintosh Foundation. Report and Accounts involve uncertainty since future events Shareholders who have a very small number of shares, which and circumstances can cause results and developments to differ might be considered uneconomic to sell, are able to donate them materially from those anticipated. to the charity ShareGift, which are then sold and the proceeds The forward-looking statements reflect knowledge and distributed to a wide range of UK charities. Further details information available at the date of preparation of this Annual about ShareGift can be obtained from www.ShareGift.org or by Report and Accounts and the Company undertakes no obligation telephoning 0207 930 3737. to update these forward-looking statements. Nothing in Capital gains tax this Annual Report and Accounts should be construed as a profit forecast. The market value of UBM’s shares on 31 March 1982 was 165p. The adjusted market value for shares acquired prior to 31 March 1982 which participated in the rights issues of November 1983 and June 1993 is 232.5p. The market quotations of the Company’s Ordinary shares and ICAP plc (previously Garban plc) Ordinary shares for 17 November 1998, being the first day of dealing following ICAP’s demerger from the Company were as follows: UBM Ordinary shares of 25p – 638p ICAP plc Ordinary shares of 50p – 217p The market values of UBM’s Ordinary shares of 25p and B shares on 23 April 2001 following the capital reorganisation were as follows: Ordinary shares of 25p – 693p B shares – 245p

172 UBM Annual Report and Accounts 2017 Event credits: Printing and paper Cover: Istanbul Jewellery Show Global market P6: (Left) Black Hat USA (Right) CPhI China Achieve Your ambitions: Food Ingredients Europe Global market P8: Black Hat Europe CPhi China Case study: CPhI China Sector Growth P9: Hofex Printed in the UK by Pureprint on Matches Buyers and Sellers: CPhI China Allworld P14: (Left & Right) Hofex Galerie Art Satin. Build Relationships & Close deals: CPhi North Americas Case Study P15: Pureprint is a CarbonNeutral® IFSEC Global CPhI North America company. Both manufacturing mill and the printer are registered to GDC Case study: GDC Expansion of fashion P16: (Left) Project the Environmental Management Women’s (Right) Black Hat Europe Share Ideas and Learn: System ISO14001 and are Forest Black Hat Europe Sleep Case study P18: Sleep Stewardship Council® (FSC) chain-of-custody certified. Inspire: Content Marketing World Black Hat Gives Back P28: Black Hat USA See You there: Cosmoprof Asia

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