8th Apr 2020 09:12
(Alliance News) - RELX PLC on Wednesday said underlying revenue growth in its three main business areas was a little higher in the first quarter of 2020 but its smaller Exhibitions business has suffered from the Covid-19 prevention measures.
The three main areas of business for RELX are Legal, Risk & Business Analytics, and Scientific, Technical & Medical. These made up 87% of information-based analytics and decision tools company RELX's adjusted operating profit in 2019.
These three areas saw slightly higher year-on-year revenue growth in the three months ended March 31 with "only a limited impact from Covid-19". RELX added, however, that their outcome in 2020 as a whole "may be affected by changes in the evolving economic environment and by activity levels in our customer markets."
In Exhibitions, performance was more worrisome. The unit made up 16% of revenue and 13% of adjusted operating profit in 2019 and has been "impacted significantly" by the pandemic. RELX said Exhibitions' outlook is now "highly uncertain", and this means it cannot provide guidance for the business for 2020 as a whole.
"Depending on the impact and duration of the restrictions resulting from the Covid-19 pandemic, further rescheduling or cancellation of events may be necessary, making the full year outlook highly uncertain," RELX said.
However, RELX did provide guidance for its three main areas, with Scientific, Technical & Medical - which made up 34% of 2019 revenue - expected to report stable revenue overall as its revenue is 75% subscription based. Nonetheless, Scientific, Technical & Medical may experience some disruption with customer markets possibly hurt by the pandemic.
Risk & Business Analytics, 29% of 2019 revenue, experienced higher revenue in the first quarter but its "full year outcome will depend on the extent and duration of the slowdown in business activity in the US and on the level of transactional activity in our customer markets".
Legal, which made up 21% of 2019 revenue, has almost 80% subscription-based revenue, and so as with Scientific, Technical & Medical its revenue should remain relatively stale. However, the pandemic may hurt performance if it results in "a prolonged slowdown in the legal services industry" or limits its ability to conduct new in-person sales and distribute print products.
Having issued EUR2 billion of long-term bonds in March, RELX had only approximately USD250 million of net short term debt outstanding on March 31 after funding its acquisition spend. It has around USD3.5 billion of undrawn, committed facilities. At the end of 2019 its net debt was GBP6.2 billion.
RELX's current GB150 million buyback programme tranche will complete on April 22. The planned total for the year was GBP400 million. RELX has opted not to proceed with the next buyback tranche but will review this later in the year.
In February, RELX had said it was looking to appoint a successor to Chair Anthony Habgood. However, this is likely to take longer than expected due to the Covid-19 pandemic and measures in place to prevent its spread. Habgood has agreed to continue as chair until a successor is appointed.
Shares in RELX were up 0.3% at 1,723.50 pence in London on Wednesday morning.
By Anna Farley; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
Relx