19th Jul 2005 07:00
Centaur Holdings PLC19 July 2005 19 July 2005 Centaur Holdings plc PRE-CLOSE TRADING STATEMENT Full year results in line with market expectations and EBITDA margins anticipated to show significant growth year on year Centaur Holdings plc, the specialist business publishing and informationcompany, today issues a pre-close trading update, prior to its preliminaryresults announcement, scheduled for 20th September 2005. Overall trading performance review Results for the year ended 30th June 2005 are anticipated to be in line withmarket expectations, with the Group achieving further strong growth in ebitda(note i). This profits growth has been achieved despite a significant softeningof advertising activity during the second half and the additional operatingcosts associated with the launch of Finance Week in October 2004. The Board is committed to raising the ebitda margin to an average target levelof 20%. The Company has made good progress in the past year in leveraging itscost base to this end. As a result, underlying margins (excluding the major newinitiatives noted below) are expected to be close to the target level for theyear just ended. Advertising revenues In the year to 30th June 2005, total advertising revenues will have increased byapproximately 7% over the prior year, led by growth in recruitment advertisingrevenues of about 15%. The financial year started strongly, with continued highrates of growth in the first half, especially in recruitment advertising.However, we have experienced a marked weakening of advertising activity in anumber of our market sectors in the past three to four months, leading to otheradvertising revenues showing limited growth in the second half over the sameperiod in 2004. The weakness in advertising, which has not affected all market sectors, has beenexperienced especially in display advertising and reflects the impact of thewider economic slowdown experienced throughout this six month period.Recruitment advertising revenues, which constitute less than a third ofCentaur's total advertising revenues, have continued to grow in the second halfyear and are expected to report an increase over the prior year six month periodof about 10%, compared to the 21% growth achieved in the first half. Events Revenues from exhibitions, conferences and other events are expected to showfull year growth of about 6%. As anticipated, revenues from conferences havedeclined as we have cut back on the number of conference events, with a focus onimproving margins. Established exhibitions have performed well in the secondhalf and have been enhanced by two new exhibitions during the period, both ofwhich have contributed a small profit contribution. Major Development Initiatives The two major new development initiatives within the Company are PerfectAnalysis (PA) and Finance Week (FW). PA is an online equity research tool forinvestment professionals that is based on a product acquired in October 2003 bythe Company's subsidiary Perfect Information Ltd. PA's development programme,now being conducted in cooperation with a major global client, remains on tracktowards an expected completion in early 2006. FW has been well received by itsreaders and has now obtained its first ABC certificate, confirming its positionas the leading news title for senior financial managers in major Britishcorporates. Advertising revenues are building steadily. The operating and product development costs of PA and FW will adversely affectebitda in the year to 30th June 2005, in line with expectations. Both productsare expected to deliver significant returns in the medium term. Acquisitions Logistics Manager, acquired in February 2005, is trading in line with ourexpectations. The magazine traded at around break-even in the period to June2005 but forward bookings on the two exhibitions give us confidence of a goodreturn in the new financial year. Current Trading The Board is confident that its strategy of building strong multi-platformbrands serving niche business communities will enable the Company to makefurther progress in the new financial year. Given the present uncertaintiesregarding the strength of the UK economy, we are not expecting furthermeaningful recovery in total advertising revenues until early 2006, althoughinternet advertising continues to deliver strong growth. We therefore currentlyexpect revenue growth in the new financial year to be driven principally by theimpact of new and recently launched products supported by a resumption of growthin advertising in the second half. Notes i. Our key measure of profit is earnings before interest, tax, depreciation and amortisation and excluding exceptionals (ebitda) Enquiries Centaur Holdings plc Graham Sherren Tel: 020 7970 4000 Geoff WilmotGavin Anderson & Company Richard Constant Tel: 020 7554 1400 Laura Hickman Janine Brewis This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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