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 reportStrategic – 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% statements Financial +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 reportStrategic 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.