29th Jan 2015 08:02
LONDON (Alliance News) - Euromoney Institutional Investor PLC Thursday said revenue fell 4% in its first quarter, hampered by pressures on the investment banking sector and weak commodity prices, offsetting an improving performance in the asset management sector.
At constant currency, revenue was down 5%, and the company said that whilst currency movements did not "materially" hit its first quarter results, the strength of the US dollar against sterling is expected to have a more "significant" hit to its second quarter.
The company generates more than half of its operating profits in dollars.
Euromoney said trading conditions had remained challenging during the quarter to end-December 2014, with banks reporting further weakness in fixed income activities, and the sudden downturn in the oil price adding pressure to commodity markets, which Euromoney serves with trade publications and conferences.
After adjusting for sold businesses, revenue for the first quarter was flat at GBP94.7 million.
The company has previously indicated that its adjusted operating margin for the year will be reduced, and said Thursday that its acquisition of a share in Dealogic will reduce its subscription revenue and adjusted operating profits by nearly GBP6 million on a yearly basis.
Euromoney sold its interests in Capital Data and Capital Net to buy a 15.5% stake in Dealogic for USD59.2 million last November.
For its full year, the company said it expects its long-term incentive scheme to reduce its profit by around GBP4 million compared to the previous year, and expects the Dealogic transaction to dilute its earnings by around 2% in the current year. It noted that these hits will only be partially offset by benefits from the strength of the dollar.
"While trading conditions remain challenging, the group will maintain its strategy of investing in new products and digital publishing, particularly through its Delphi content platform, to drive organic growth, as well as using its strong balance sheet and cash flows to continue to fund further acquisitions," Euromoney said in a statement.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
Copyright 2015 Alliance News Limited. All Rights Reserved.
Related Shares:
ERM.L