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Scottish Event Campus Limited Scottish Event Campus Limited Corporate Review 2016 – 2017 Chairman’s Welcome 4 Contents Chief Executive’s Review 6 Venue Sales Exhibitions 8 Conferences 10 Live Entertainment 12 Commercial 14 Financial Review 16 2 Corporate Review 2016 - 17 3 2016/17 has been another to its origins, maintaining a Chairman’s very successful year for the connection to the excellent The development of two hotels Scottish Event Campus Limited reputation the venue has on the campus is likely to begin Welcome (hereafter SEC, or the Group). built up in each of the market in the final quarter of 2017. The sectors in which we operate – hotels will add approximately Of course, our success is Conferences, Exhibitions and 400 bedrooms to the campus measured not only in financial Live Entertainment. when complete. The hotels will Key financial and other performance indicators during the year were as follows: terms but also by the economic be an invaluable addition and will 2017 2016 impact of the campus. In the Over the period, trading profits support our growing Conference year 2016/17, as a result of the continued to be reinvested to and Exhibition sectors as well as Turnover £28.8m £29.4m business conducted by SEC, ensure the existing facilities meet our Live Entertainment offering EBITDA ¹ £3.4m £4.3m the net additional expenditure the needs of our customers in an and will help us to continue to Net cash inflow from operating activities £7.8m (£5.5m) in Glasgow was estimated at increasingly competitive market. generate economic benefits for Capital Expenditure excluding projects £1.6m 1.8m £414m, in Scotland £272m and in During the year investment in the Glasgow, Scotland and the rest of Economic Impact (estimated) £414m £411m the UK, £166m which amounts to backstage artist and promoter the UK. Number of Visitors 1.9m 1.8m expenditure of over £1m per day areas took place along with the Pollstar Arena Global Ranking 8th 3rd in the Glasgow area. enhancement of hospitality areas The success during the year was Number of Exhibitions held 45 42 and handrails added in The SSE down to the efforts of the SEC Number of International Conferences held 12 16 During the year, the business Hydro. Upgraded digital signage team which has made us such changed its name to Scottish was installed in the SEC Centre a popular destination for event ¹ EBITDA is defined as operating profit from recurring operations before depreciation of assets and release of grants. Event Campus Limited from and The SEC Armadillo and new organisers, with a reputation for Scottish Exhibition Centre websites for SEC and The SSE providing a professional friendly Limited. The new name Hydro were launched. service with a ‘can do’ attitude. acknowledges that the venue has developed over a period of In line with this, and to capitalise In November 2016 Rough Guides more than 30 years – with The on the success that Glasgow and declared Glasgow to be the Armadillo and The SSE Hydro Scotland have had in the events world’s friendliest city – this being added to the site over industry over recent years, a is epitomised by the SEC. My time. In addition, the company feasibility study was prepared thanks go to the Board, our staff recognises that over this to establish viable options for and the key partners forming the period, Live Entertainment has upgrading and expanding the wider team for their energy and grown to be a significant part campus, principally to facilitate commitment during the year. of the business which is not further growth in the Conference represented by its former name. and Exhibition sectors. The ambitious plans are supported Will Whitehorn As a brand, The Scottish Event by a robust business plan and Chairman Campus better describes the an economic impact study. site, is more representative of The focus now will be to secure what we do and reflects a vision funding support for a project for the future. It is important which would be of significant to add that the new name benefit to the Glasgow and still retains a clear reference Scottish economies. 4 Corporate Review 2016 – 17 5 There was a net cash inflow from activities including sponsorship Chief Executive’s operating activities of £7.8m and hospitality. Commercial for the year. Whilst the business turnover for the year increased Review is inherently cash generative, by 6%. We continued to add to there can be variations from year our sponsorships during the year to year as a result of cash held and renewed some agreements on behalf of concert promoters. on longer term deals. Our Significant cash fluctuations can Hydro Club hospitality offering arise from inflow at the time of is nearing capacity and our the ticket sales and outflow at Executive Suites are currently all the performance date. under contract. The results include the impact QD Events, our event from the disposal of one of the management subsidiary, has hotel sites on the campus. A continued to provide a solid Our underlying business trends gain on sale of £2m is included in contribution to Group results continue to be very positive. the results. The second site was with a robust performance Turnover for the year (£28.8m) disposed of post year end with delivered by the existing was in line with last year despite proceeds of £0.6m and will be portfolio of shows including the expected reduction in included in the following financial The Scottish Caravan Show, conference business from the year’s results. The Wedding Show and The Irn record levels of the previous Bru Carnival. During the year year. A record year for exhibitions QD Events added Insomnia evidences the growth in this x Resonate – The Festival of but individual approach to recently, SEC was announced A change to the timing of sector and future conference eSports and Gaming to their learning and development of as the winner of ABPCO’s Best Peter Duthie recognition of ticketing income business is strong. portfolio with a successful every employee. The People Industry Partnership Award. The Chief Executive has had a transitional impact launch. Strategy is aligned to the vision SSE Hydro was awarded The in this year only, leading to a The SSE Hydro continues to be and mission of the business, in Royal Academy of Engineering, reduced operating profit for one of the world’s top venues An overall vision for the business particular the need to have the Major Project Award, a the year of £1.1m. Underlying with over 1 million visitors during – ‘To be the best event campus “Best People”. prestigious award which business profitability is, the year, returning to number in Europe’ – has been adopted recognises the impact that a however, also in line with the 2 on the list of the busiest live with the mission statement SEC continues to be the project has had on society. previous year. entertainment arenas in the - ‘Best Venues, Best People, recipient of major industry world in the first quarter of 2017. Best Events’. The vision and awards having previously been These awards reflect the The EBITDA of £3.4m was mission drive the strategy for named Large Venue of the increasing standing which SEC, driven by the strong sector The SSE Hydro not only provides the Group. The implementation Year at The Drum UK Event including The SSE Hydro, now performances. This is a key a purpose built venue to host of the People Strategy began Awards, the Best Event Space has in the various sectors in measure for the business our Live Entertainment events, this year, with our Culture and at the Event Magazine Awards, which we operate. and cash generated has been but also provides an income Values being a key focus. This and Venue of the Year at the reinvested in the campus. stream from commercial provides a more strategic Exhibition News awards. Most 6 Corporate Review 2016 – 17 7 EXHIBITIONS AT A GLANCE 2016/17 delivered record and outdoor) beautifully the SEC rebrand and continue Exhibitions turnover for exhibitions and demonstrating our flexibility the awareness building activity — 15% growth in revenue a third consecutive year of and operational capabilities as a through content marketing and — 45 events including 5 new shows growth. This continues to be broader event campus. PR. — Over £460k in new business accounting through a combination of high retention levels and strong new We created a marketing role Moving forwards, we are for 11% of turnover business wins. dedicated to exhibitions with focussing on our catering — 97% retention of year on year revenue the dual purpose of raising proposition, customer insight This year saw the launch of the awareness of the campus and and strategic marketing — 9% increase in visitor footfall Ignition Festival of Motoring, a supporting organisers to drive support. All of which should help spectacular event celebrating visitor attendance. Through drive footfall and associated all elements from the world initiatives such as the affiliate commercial opportunities whilst of motor sport, interactive marketing scheme, this is delivering the best possible experiences and a live street already paying dividends and has customer experience. circuit on the streets of been very well received by both Glasgow. Not only was Ignition new and existing customers. a great partnership between Brand Events, Visit Scotland We agreed a year long strategic and Glasgow Life, it also utilised partnership with the Association all areas of the SEC (indoor of Event Organisers to support 8 Corporate Review 2016 – 17 9 CONFERENCES AT A GLANCE Whilst the conference turnover This has been reinforced with Scottish Event Campus will Conferences decreased by 21% in the year, the volume and value of business support further growth in this - 50 association conferences and corporate the previous financial year was secured in the reporting period.
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