27th Feb 2015 08:00
LONDON (Alliance News) - UBM PLC Friday posted a rise in pretax profit for 2014 as lower costs and exceptional gains helped offset a fall in revenue, and said it has made good progress with its so-called 'Events First' strategy in the first two months of 2015.
The PR Newswire owner and events firm proposed a final dividend of 16.0 pence, taking its total dividend for the year to 21.3 pence, up from 21.1 pence a year before.
UBM posted a pretax profit of GBP145.2 million, up from GBP109.5 million, despite seeing revenue fall 6% to GBP746.3 million from GBP793.9 million, due to lower operating expenses and an GBP21.9 million exceptional gain from PA Group, the UK news agency, in which UBM has a 17% interest, selling its weather forecasting business. The gain more than offset GBP15.7 million in impairment charges.
In the previous year, UBM had posted exceptional costs of GBP33.2 million, mostly relating to restructuring and impairments.
UBM said its revenue had been held back by the strength of sterling during the year, the rationalisation of its other marketing services segment, and lower biennial revenue in an 'even' year. At constant currency revenue was down 0.8%.
It said that the integration of Advanstar, which it acquired for USD972 million last December, is on track and trading in its first couple of months has started well.
UBM first announced its Events First strategy last November, which aims to produce cost savings starting in 2016 that will build to GBP10 million per year and drive profitable growth in its Events business, whilst cutting out activities that do not support it.
It has sold or discontinued a number of smaller less profitable shows and rationalised its range of other marketing services activities that don't fit with this strategy so far.
UBM said it intends to make investments of GBP15 million between 2015 and 2017, and implementation and rationalisation costs of between GBP15 million to GBP20 million in the same period, in order to achieve this strategy.
The company said its outlook for 2015 continues to reflect the guidance it gave when it outlined the strategy: that Events First will allow it to grow revenue ahead of global gross domestic product in its events business, and provide a basis for medium-term margin expansion.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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