Annual Report & Accounts 2014
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Annual Report & Accounts 2014 Euromoney Institutional Investor PLC 23612.04 - 17 December 2014 12:23 PM - Proof 8 Euromoney Institutional Investor PLC www.euromoneyplc.com Euromoney Institutional Investor PLC is listed on the London Stock Exchange and a member of the FTSE 250 share index. It is a leading international business-to-business media group focused primarily on the international finance, metals and commodities sectors. It owns more than 70 brands including Euromoney, Institutional Investor and Metal Bulletin, and is a leading provider of economic and investment research and data under brands including BCA Research, Ned Davis Research and the emerging markets information providers, EMIS and CEIC. It also runs an extensive portfolio of conferences, seminars and training courses for financial and commodities markets. The group’s main offices are in London, New York, Montreal and Hong Kong and more than a third of its revenues are derived from emerging markets. Year in Brief April June October Disposal of MIS Training Decision to move London Acquisition of Infrastructure Launch of IJGlobal — merger of headquarters to Bouverie Street Journal (IJ) for £12.5m Project Finance and IJ after 40 years in Nestor House March July Delphi project with investment Acquisition of Mining Indaba of £10m completed on time and for £45m on budget BCA and GlobalCapital first products launched on Delphi content platform 23612.04 - 17 December 2014 12:23 PM - Proof 8 Annual Report and Accounts 2014 01 Highlights Contents Revenue Net Debt Overview Highlights 01 £406.6m £37.6m Our Divisions 02 Chairman’s Statement 04 2014 406.6 2014 37.6 Appendix to Chairman’s Statement 06 2013 404.7 2013 9.9 Strategy and Performance 2012 394.1 2012 30.8 Strategic Report 07 Operating Profit Adjusted Operating Profit Governance £103.6m £119.8m Board of Directors 34 Directors’ Report 35 2014 103.6 2014 119.8 Corporate Governance 38 Directors’ Remuneration Report 46 2013 105.6 2013 121.1 2012 95.9 2012 118.2 Financial Statements Profit before Tax Adjusted Profit before Tax Group Accounts Independent Auditor’s Report 67 £101.5m £116.2m Consolidated Income Statement 71 Consolidated Statement of 2014 101.5 2014 116.2 Comprehensive Income 72 Consolidated Statement of 95.3 116.5 2013 2013 Financial Position 73 2012 92.4 2012 106.8 Consolidated Statement of Changes in Equity 74 Consolidated Statement of Diluted Earnings per Share Adjusted Diluted Earnings per Share Cash Flows 75 Note to the Consolidated 59.2p 70.6p Statement of Cash Flows 76 Notes to the Consolidated 2014 59.2 2014 70.6 Financial Statements 77 2013 56.7 2013 71.0 Company Accounts 2012 55.2 2012 65.9 Company Balance Sheet 133 Notes to the Company Accounts 134 Dividend Other 23.0p Five Year Record 145 2014 23.00 Shareholder Information 146 2013 22.75 April June October Disposal of MIS Training Decision to move London 2012 21.75 Acquisition of Infrastructure Launch of IJGlobal — merger of headquarters to Bouverie Street Journal (IJ) for £12.5m Project Finance and IJ after 40 years in Nestor House Visit us online at March July Delphi project with investment Acquisition of Mining Indaba euromoneyplc.com of £10m completed on time and for £45m on budget BCA and GlobalCapital first products launched on Delphi content platform 23612.04 - 17 December 2014 12:23 PM - Proof 8 02 Euromoney Institutional Investor PLC www.euromoneyplc.com Our Divisions RESEARCH FINANCIAL BUSINESS AND DATA PUBLISHING PUBLISHING REVENUE REVENUE REVENUE £126.5m £80.3m £67.8m The group provides a Financial publishing The business publishing number of subscription- includes an division produces print based research and data extensive portfolio and online information services for financial of titles covering the for the metals, minerals markets. international capital and mining, legal, Montreal-based BCA Research is one of markets as well as a telecoms and energy the world’s leading independent providers number of specialist sectors. of global macro-economic research. In 2011, the group expanded its independent financial titles. Its leading brands include: Metal Bulletin, American Metal Market, Industrial research activities with the acquisition of Products include magazines, newsletters, Minerals; International Financial Law US-based Ned Davis Research, a leading journals, surveys and research, directories Review, International Tax Review, provider of independent financial research and books. to institutional and retail investors. EMIS Managing Intellectual Property; Capacity; provides the world’s most comprehensive A selection of the company’s leading Petroleum Economist, World Oil and service for news and data on global financial brands includes:Euromoney , Hydrocarbon Processing. emerging markets and CEIC, one of the Institutional Investor, GlobalCapital, Latin leading providers of time-series macro- Finance, Insurance Insider, IJGlobal, Air economic data for emerging markets. Finance, FOW and the hedge fund title EuroHedge. Divisional split 5% 32% 26% Research and data Financial publishing Business publishing 17% 20% Conference and seminars Training 23612.04 - 17 December 2014 12:23 PM - Proof 8 Overview Our Divisions Annual Report and Accounts 2014 03 CONFERENCES TRAINING AND SEMINARS REVENUE REVENUE £106.1m £19.4m The group runs a The training division large number of runs a comprehensive sponsored conferences range of banking, and seminars for the finance, energy and international financial legal courses, both and commodities public and in-house, markets, mostly under the Euromoney under the Euromoney, and DC Gardner brands. Ned Davis Institutional Investor, Courses are run all over the world for both Research Metal Bulletin, financial institutions and corporates. Group Coaltrans and IMN brands. Many of these conferences are the leading annual events in their sector and provide sponsors with a high-quality programme and speakers, and outstanding networking opportunities. Such events include: Euromoney’s Covered Bond Congress; the Saudi Arabia Conference; the EuroHedge Summit; the Global Airfinance Conference; and Global ABS and ABS East for the asset-backed securities market. In the commodities sector, events include Metal Bulletin’s Middle East Iron and Steel conference and the world’s leading annual coal conferences, Coaltrans World Coal Conference and Coaltrans Asia; and TelCap runs International Telecoms Week, the worldwide meeting place for telecom carriers and service providers and Capacity Middle East. media 23612.04 - 17 December 2014 12:23 PM - Proof 8 04 Euromoney Institutional Investor PLC www.euromoneyplc.com Chairman’s Statement We have continued to disposals, increased by 3% at constant currency. maintaining tight cost control; retaining and The underlying revenue trends reported for fostering an entrepreneurial culture; and using invest in the business the first half for subscriptions and advertising a healthy balance sheet and strong cash flows despite the difficultlargely continued into the second, while event to fund selective acquisitions. A detailed review revenue growth was driven by a combination of the group’s strategy is set out in the Strategic trading conditions. The of increased event volumes and favourable Report from page 7. Delphi content platform timing. The adjusted operating margin fell from Capital Appreciation Plan (CAP) 30% to 29%, reflecting the group’s continued was successfully launched The CAP is the long-term incentive scheme strategic investment in digital publishing. and the focus in 2015 designed to retain and reward those who drive The new Delphi content platform was launched profit growth and is an integral part of the will include rolling out successfully earlier in the year and is already group’s successful growth strategy. The CAP was Delphi’s functionality to starting to generate benefits for businesses such first introduced in 2004, since then it has been Euromoney’s other titles as BCA and the newly launched GlobalCapital a key driver of the more than fivefold increase in news and data service for international capital the company’s adjusted profit before tax. and investing in a strong markets. The digital focus in 2015 will include Shareholders approved the introduction of rolling out Delphi’s functionality to the group’s pipeline of new information CAP 2014 at the AGM in January 2014. It has other titles and investing in a strong pipeline a similar structure to CAP 2010. Initial awards services and databases, of new information services and databases, under CAP 2014 were granted on June 20 while accelerating the move while accelerating the move to a digital-only to approximately 250 senior employees and format for most of the group’s titles by the end to a digital-only format for executive directors. A maximum of 3.5 million of 2016. most of the group’s titles ordinary shares and £7.6 million of cash will be Net debt at September 30 was £37.6 million used to satisfy CAP 2014 awards. The shares will by the end of 2016. compared with £28.6 million at March 31 and be acquired in the market under the authority The pressures on the investment banking sector £9.9 million at last year end. The increase reflects granted by shareholders at the AGM, and from increased regulation and compliance net acquisition spend of £55.7 million, including 1.7 million shares were acquired during 2014 at costs show no real sign of easing. However, £45.6 million for the purchase of Mining Indaba a cost of £21.5 million. CAP awards are expected other organic growth initiatives in events and and £12.5 million for Infrastructure Journal, and to vest in three tranches in 2018, 2019 and data provide confidence in the company’s £21.5 million spent buying the company’s own 2020, subject to certain performance tests. longer term growth strategy, while its strong shares to satisfy expected future rewards under The primary performance test for CAP 2014 balance sheet and cash flows provide plenty of its new long-term incentive plan.