Informa plc (LON:INF), the international B2B Events, B2B Digital Services and Academic Markets Group, has published full year results for 2023, confirming 30%+ revenue growth and £700m+ of shareholder returns, as well an update to 2024 guidance following a strong start to the year.
Stephen A. Carter, Group Chief Executive, Informa PLC, said:
“Informa’s final results confirm further outperformance in 2023 and continuing momentum and growth in 2024.”
He added: “Strong growth in IMEA, (India, Middle East & Africa), which is emerging as a material geographic growth engine alongside the Americas, China, ASEAN, and Europe, leads to updated 2024 guidance. We are expanding our platform in B2B Digital Services through the proposed combination with TechTarget. And we are delivering further strong shareholder returns in 2024, including continuing dividend growth and a minimum of £340m of in-year share buybacks.”
Strong Outperformance in 2023
· 2023 Outperformance1,2: Revenue £3,189.6m (2022: £2,262.4m), Adjusted Operating Profit1 £853.8m (2022: £496.3m) and Free Cash Flow1 £631.7m (2022: £417.9m), significantly ahead of market guidance set at the start of the year;
· Strong Underlying Growth1,2: Underlying revenue growth of 30.4% and underlying adjusted operating profit growth of 59.1% in 2023, including strong growth in B2B Markets and continuing growth in Academic Markets;
· Increasing Operating Margin1,2: Significant increase in adjusted operating margin to 26.8% (2022: 21.9%), driven by strong underlying revenue growth, operating leverage and efficient cost management; Further margin increase targeted in 2024;
· Growing Earnings per Share1,2: Adjusted diluted earnings per share +86% to 45.3p (2022: 24.4p), reflecting strong growth in adjusted earnings and the benefit of our share buyback programme;
· Improving Statutory Performance2: 2023 statutory revenue +41% to £3,189.6m (2022: £2,262.4m), statutory operating profit +176% to £507.8m (2022: £184.1m), and statutory diluted EPS +218% to 29.9p (2022: 9.4p), reflecting the strong growth in reported revenues and profits;
· Balance Sheet Strength: Strong free cash flow growth and disciplined capital allocation delivers year-end leverage of 1.4x Net Debt/EBITDA, including more than £90m of capital expenditure and c.£550m of share buybacks.
Momentum and Growth in 2024
· Strong Q1 Trading and Forward Visibility: More than £500m revenue already delivered in 2024, with all businesses on track for full year expectations, and with a further £1bn+ in subscriptions and other forward booked revenues committed or visible;
· IMEA Growth Engine: Expansion of our brand portfolios in the UAE, Kingdom of Saudi Arabia, Kingdom of Bahrain, India, Egypt and Turkey is driving strong regional growth, where there is growing demand for B2B market access, live experiences and specialist knowledge;
· Updated 2024 Market Guidance: The combination of all the above drives an increase in guidance to Reported Revenue of £3,450m-£3,500m, Adjusted Operating Profit of £950m-£970m and Free Cash Flow of £720m+ (excluding the proposed combination with TechTarget; GBP/USD 1.25);
1In this report, we refer to non-statutory measures, as defined in the Financial Review on page 9 and Glossary on page 45. / 2Continuing businesses
Momentum and Growth in Growth Acceleration Plan 2 (“GAP2”)
· Live B2B Events: Strong underlying growth in Live & On-Demand Events, including in Pharma, Healthcare, Technology, Aviation, Food and Beauty; Combined with targeted inorganic expansion in 2023 and the prospective combination with TechTarget, total B2B revenues increase to c.£3bn;
· International expansion: Continuing organic expansion in fast growth economies, including multiple new event launches across IMEA, China and ASEAN in 2024;
· New TechTarget: Continuing progress on prospective combination of Informa Tech’s digital businesses and US-listed TechTarget to create a leading platform in B2B Digital Services; Initial regulatory filings completed, alongside preparation of the Proxy Statement and the operating model for New TechTarget, keeping us on track for completion in second half of the year;
· Informa Connect: Strong organic growth, combined with portfolio additions from Tarsus, Winsight and Informa Tech Events will increase Informa Connect’s annual revenues to $1bn+, delivering high value, content-led events and subscription data to six growth markets (Biotech & Life Sciences, Finance, Foodservice, Anti-Aging & Aesthetics, Lifestyle and Technology);
· First Party Data: Further momentum in B2B first party data, with IIRIS consented audience over 20m, underpinning initiatives to enhance B2B customer experience and improve marketing effectiveness, as well as the proposed TechTarget combination;
· Academic Markets: Growing Open Research volumes and Pay-to-Publish services at Taylor & Francis are complementing our underlying strength in traditional Pay-to-Read publishing, driving improving underlying revenue growth, with a step up to 4% targeted in 2024;
Momentum and Growth in Shareholder Returns
· Increasing shareholder returns in 2023: More than £700m returned through dividends and buybacks in 2023 (2022: £550m);
· Strong dividend growth1: Total ordinary dividends of 18.0p per share in 2023, +84% year-on-year;
· Expanded share buyback programme: c.£550m of share buybacks in 2023, taking total returns since divestment of Intelligence portfolio to £1.15bn, with c.180m shares cancelled;
· Capital allocation framework: Consistent organic investment and strong shareholder returns combined with focused inorganic investment, with target leverage of 1.5x to 2.5x Net Debt/EBITDA;
· Strong shareholder returns in 2024: A progressive dividend and £340m+ of in-year share buybacks (£90m year-to-date, £250m further commitment), with the potential to increase buybacks if attractive inorganic investment opportunities do not materialise.
Momentum and Growth in ESG
· FasterForward on sustainability: Continuing progress on FasterForward ESG strategy, including the Sustainable Events Fundamentals Programme, recognised through inclusion in Dow Jones Sustainability Index for sixth consecutive year and AAA ESG Rating from MSCI for the first time.
Trading Outlook…Momentum and Growth
The macro-economic environment remains varied across the world. Ongoing conflict and geopolitical uncertainty, combined with heightened inflation and higher interest rates, are impacting confidence and demand in some developed markets. This is balanced by continuing growth in other regions, where investment in innovation and economic diversification is driving expansion and commercial opportunities.
Informa’s focus on major specialist brands, combined with our continuing expansion in rapidly growing geographies and structurally growing customer markets, is enabling the Group to deliver consistently strong performances, with good forward momentum and growth.
2024 Market Guidance: Further strong growth in Revenues and Adjusted Operating Profit
In 2024, we are targeting high single digit revenue growth, double-digit growth in adjusted operating profit and a further increase in operating margin. This reflects strong underlying growth in B2B Markets (Informa Markets, Informa Connect and Informa Tech), and improving underlying growth in Academic Markets. We will also benefit from a full year contribution from acquisitions made in 2023, partially offset by lower biennial revenues, reflecting the smaller portfolio of biennial events that traditionally run in even years.
2024 has started strongly, with £500m+ of Group revenues delivered and a further £1bn+ booked, committed or visible. All businesses are on track for full year expectations, with particular strength in IMEA, as we continue to expand our brand portfolios in the region on the back of strong demand for our specialist products and services.
Final outperformance in 2023 and the strong start to 2024 leads us to update market guidance, with an increase in Revenue, Adjusted Operating Profit and Free Cash Flow.
Updated 2024 guidance is Group Revenue of £3,450m to £3,500m, Group Adjusted Operating Profit £950m to £970m and Free Cash Flow of £720m+ (excluding any effect of the proposed combination with TechTarget; GBP/USD 1.25).
Informa Markets…Transaction-led Live & On-Demand B2B Events
In an increasingly digital world, underlying demand for high quality live experiences continues to grow. This was evident in the pace and rate of return of our transaction-led live event brands in 2022 and 2023 and it is reflected in strong forward bookings and customer commitments in 2024.
We have built a portfolio of world class specialist brands to meet this growing demand, providing unique access to 20+ specialist markets and powerful platforms for buyers and sellers to trade. This makes them must-attend events for customers and key drivers of innovation and growth in those markets.
The strength of this portfolio is delivering further strong growth in 2024, with first quarter trading giving us confidence in our full year target for high single digit underlying growth and further improvement in adjusted operating margins.
In recent years we have invested significantly in technology and data to enhance our products and the value they create for exhibitors and attendees, including through customer experience, targeted matchmaking and lead qualification. This is enabling us to improve average yields and drive value growth across the portfolio, with a strong pipeline of further enhancements over the next few years.
At the same time, we are delivering volume growth, both from established brands, as more companies seek access to markets and deeper B2B relationships, and through the launch of new brands.
In 2024, across the five regions where we have built international platforms (IMEA, ASEAN, China, Americas and Europe), we are planning to launch around 20 new or geo-adapted events. The majority are in the rapidly growing economies of China, the United Arab Emirates, the Kingdom of Saudi Arabia and Indonesia, where there is strong demand for specialist knowledge, B2B connections and live experiences.
Informa Connect…Content-led Live & On-Demand B2B Events
Informa Connect is a market leader in content-led live and on-demand experiences, specialist content and accredited training. Across six growth markets (Biotech & Life Sciences, Finance, Foodservice, Anti-Aging & Aesthetics, Lifestyle and Technology), we operate more than 400 specialist live and on-demand brands, as well as three growing subscription data businesses in Finance (Curinos, IGM, Zephyr).
The strength of these brands and market positions is delivering further momentum and growth in 2024, with first quarter trading underpinning our full year target for high single digit underlying revenue growth and further improvement in adjusted operating margin.
The rich content and depth of connectivity that characterises Informa Connects’ events is providing valuable insights into customer preferences. Through the IIRIS analytics platform, we are collecting detailed firmographic and behavioural data which is increasingly being used to deliver value-added products eg Lead Insights, an end-to-end lead generation platform. This platform provides event sponsors and exhibitors with near real-time access to leads that can be scored, ranked, segmented, enriched and then used in targeting campaigns launched and tracked directly from the platform. It significantly enhances the value customers can derive from our events.
The scale and reach of Informa Connect has increased significantly in recent years. Strong underlying growth, combined with the addition of brands from Tarsus, Winsight, Informa Markets (the Anti-Aging and Aesthetics portfolio) and, post the proposed TechTarget combination6, the Informa Tech events portfolio, will take Informa Connect’s annual revenues to over $1bn, with more than 70% delivered in the US.
This expanded portfolio includes a range of marquee brands, which are the annual convening place for their industry, providing unique access to high value networking, cutting edge content and live experiences. These are major growth engines deeply embedded within their markets, with the expanded Informa Connect’s Top 50 brands delivering c.60% of event revenue.
Informa Tech…B2B Digital Services
Informa Tech is performing to plan in 2024, with first quarter trading delivering strong subscription renewals in Specialist Research (Omdia, Canalys), further stabilisation in Media & Demand Generation and continuing momentum in Live Events, with the following major live brands running in March (LEAP, Enterprise Connect, GDC).
In January, we announced the proposed combination of Informa Tech’s digital businesses (Industry Dive, Omdia, Canalys, NetLine and the Digital Media Brands) with US-listed TechTarget. New TechTarget, which will be headquartered and listed in the US, will accelerate Informa’s ambition in B2B Digital Services, creating a leading platform in B2B Data and Market Access, with forecasted annual sales of c.$500m.
The procedural elements of the combination are progressing to plan as we prepare the Informa Tech businesses to be combined with TechTarget, including filing Hart-Scott Rodino documents and preparing the Proxy Statement and other regulatory documents.
A Combination Director has been appointed and work on the operating model for New TechTarget is well advanced, building on the due diligence completed pre-announcement.
The response to the announcement from key stakeholders (customers, colleagues, shareholders) has been encouraging, recognising the opportunities the combination will create and benefits the enlarged business can bring to expanded data access, end-to-end product capability and product development.
We remain on track to complete in the second half of the year.
Taylor & Francis…Specialist Academic Research, Advanced Learning and Open Research
The market for specialist knowledge remains strong, underpinned by international growth in higher education and professional qualifications, and state-level investment in research and innovation. This is increasing the number of researchers and volume of research output globally, fuelling demand for specialist verification, indexation and distribution services.
This plays to the strengths of Taylor & Francis, with its portfolio of specialist publishing brands (Routledge, CRC Press, F1000), and growing portfolio of subject-specific academic content (c.2,700 journals, 140k+ annual articles, 170k+ reference titles). In 2024, this is delivering good momentum as we look to accelerate underlying growth from 3% to 4% this year.
6 Subject to majority shareholder approval and customary regulatory clearances
This growth acceleration reflects recent GAP2 investments, which have expanded the range of services we offer to authors, institutions and funders, developing more flexible Pay-to-Publish Open Research platforms alongside our traditional Pay-to-Read publishing services. This is enabling us to address broader audiences, target additional budgets and capture more value.
At the heart of our expansion in Open Research is the increasing use of technology and artificial intelligence to drive efficiencies in editorial and production, leading to improving article acceptance rates and reduced processing times. We are also seeing a flight to quality in the market, as researchers put greater emphasis on verification and authentication as well as speed to market, and this is playing to our advantage.
In the traditional Pay-to-Read area of the business, we are continuing to deliver strong subscription renewals and further traction in Read and Publish agreements with libraries and consortia. We have a strong pipeline for published article volumes, underpinning the long-term value of our subscription journal portfolio.
In Advanced Learning, we continue to invest in our front list, commissioning in under-served subject areas, with a focus on publishing more premium titles. We are also deploying technology across our backlist of 170k titles, using artificial intelligence to synthesise content into new formats and derivative products.
New Informa Group PLC: Focus, Scale and Growth
The strong performance of our businesses over recent years, combined with the benefit of inorganic investments, including the proposed combination with TechTarget, strengthens Informa’s operating model:
1In this report we refer to non-statutory measures, as defined in the Financial Review on page 9 and Glossary on page 45.
