ITE Group plc An Introduction to ITE Group plc May 2019
Contents › Our Senior Executive team pg 2 › Our business model pg 3 › Market overview pg 6 › 2017 Strategic review pg 9 › TAG programme update pg 16 › Appendices pg 36 1 /
Introduction to ITE Group plc Our Senior Executive Team Mar ark Sha hashou oua – Chi hief Ex Executiv ive Off ffic icer Andrew Be And Beach h – Chi hief Fi Financia ial Off ffic icer › › Appointed CEO in September 2016 Appointed CFO in October 2016 and is Chairman of ITE’s Risk Committee › Previously CEO of i2i Events Group, (events › arm of Ascential) from 2011, led the Previously the Chief Financial and Operating professionalisation and diversification of the Officer of Ebiquity plc, spent nine years business, turning it from double-digit CAGR overseeing the rapid expansion of the business decline to one of consistent organic CAGR to 20 offices in 14 markets, employing over growth 900 staff › › Second-generation and prominent figure in the international Prior to joining Ebiquity, he spent nine years at PwC as part of events industry the Entertainment and Media assurance practice where he qualified as a Chartered Accountant (ICAEW) in 2000 › From 2001, he was a co-founder and Chief Executive Officer of › Expomedia Group Plc and from 2009-2011, Mark was the Andrew headed up the PwC UK Publishing sector knowledge operating partner of Advent International, a leading private network and managed a portfolio of large media clients equity fund › One of the founding members of the ITE group which grew organically from 3 people to over 800 and 80 shows. He led the floatation of the business in 1998 as CEO, and was a board director until 1999. 2 /
Our business model 3 /
Our business model Connecting people EXHIBITORS VIS ISITORS use our events to satisfy come to our events to all of their marketing learn, experience, needs: to transact, develop their skills, market their brand, find inspiration, meet launch a product, new contacts or buy educate the sector, products. deploy thought leadership or steer their industry. IT ITE Group pr provides mar arket-leading , , fa face ce-to to- fa face ce pla platforms where co communities ca can co come to together to to ac achieve al all l of of th this wit ithin a a hi high- qua uality exhi hibition expe perience. 4 /
Our business model Revenue streams managed the ITE way Our ur revenue is s gen generated thro through h mu mult ltip iple le str streams We do do thin things the the IT ITE way so so exhibitors rs, vis visit itors an and d sponsors spo rs ch choo oose us us 80.8% of our revenue is generated from exhibitors, with 80. each exhibitor paying for floor space at an event. Usually, visitors attend for free (with a few exceptions). MARKET- CONTENT- MUST-ATTEND: OUTSTANDING RETURN ON Some events benefit from sponsorship revenue and we LEADING: DRIVEN: We offer the CUSTOMER INVESTMENT: also provide technical services, such as stand We focus on We supply best of EXPERIENCE: Our customer market-leading thought- everything to We have a success team construction, to some of our customers. events, so that provoking ensure we are relentless focus makes sure we have the content that the one event on improving exhibitors 2.0% highest value attracts high that our every part of achieve their 3.0% proposition quality visitors customers the customer event goals so for exhibitors and raises the choose to put in experience and that they come 14.2% and visitors profile of our their calendars tailoring our back next time Exhibitor space events communication with them Technical services Sponsorship Other 80.8% 5 /
Market overview 6 /
Market overview Overview of the events industry Top 10 event organisers by Com ompetit itio ion organising revenues, 2017, million USD Significant change in the Industry › M&A consolidation in traditional event organisers 1829 Informa › New market entrants focussing on sectors which are 1422 Reed Exhibitions being disrupted 559 Messe Frankfurt › 390 Online business communities and DIY meet-up Messe Dusseldorf platforms challenging the traditional model 354 Messe Munich › 330 Impact of new technologies - augmented reality, facial Comexposium 300 recognition, improved analytics tools provide Clarion opportunities to increase engagement, create better 257 Deutsche Messe products and drive better ROI and ROT for customers 1 196 ITE 176 GL Events 1 Pre acquisition of Ascential and Mining Indaba. Market consensus for FY19 approx. $285m. 7 /
Market overview Global exhibition market forecast › Overall market forecast 2017-2022, $bn Steady growth is forecast - 5% by 2022, driven by stable underlying economies and consistent demand for face- to-face business interactions. 5% 0.8 CAGR 0.8 0.7 0.7 › 0.6 AMR Global predict that face-to-face interactions 0.6 enabled by exhibitions will remain a critical channel for buyers and sellers. 33.6 31.7 30.4 28.9 27.7 26.3 › They further predict that alternative online channels will remain complementary, and may become sources of enhanced visitor and exhibitor experience. 2017 2018 2019 2020 2021 2022 Mature & Emerging (excl SE Asia) SE Asia 8 / Market size represents the size of the 14 main geographic markets analysed by AMR and the six SEA countries added in 2017; exclu des the ‘Rest of the World’ Source: AMR Global, Globex 2018 report
2017 Strategic review 9 /
2017 Strategic review Historical context prior to TAG programme Revenue and nd EBIT EBITDA, , FY FY11 11-16 16 £m Continued challenging +11% -11% 192 192 CAGR market conditions CAGR 175 175 172 172 155 155 Acquisition-led strategy 136 136 134 134 Margin maintained, despite revenue decline Investment held back across the portfolio 33% 30% 30% 31% 34% 31% FY11 FY12 FY13 FY14 FY15 FY16 EBITDA¹ Costs 1. Headline EBITDA 10 / Source: Annual Reports, Broker Reports, ITE Management Data
2017 Strategic review Portfolio challenges prior to TAG programme Ev Even ent perf erformance vs vs unde underlying ma market ITE Event Space Growth (%), 2014-16 CAGR The po portfolio had add dditional 100% challenges be ch beyond market 90% Underlying Market Growth (%), 2014-15 Ou Outp tperf rform rming 80% conditions co the mar arket 70% 60% A number of f events had d 50% 40% underperformed th the market 30% 20% There were so some obvious st stars 10% 0% to off to ffset th these ch challenges -50.0 -40.0 -30.0 -20.0 -10.0 0.0 10.0 20.0 30.0 40.0 50.0 -10% -20% -30% -40% -50% -60% -70% Underperforming Und -80% the mark market -90% -100% 11 /
2017 Strategic review The May 2017 Portfolio: Events Ranked by Revenue 85% 85% Co Core e Ev Events Re Revenue 12 /
2017 Strategic review Philosophies Mar arket t leading events Cus ustomer r ins nsig ight – ROI / / ROT and an d dat data Con ontent-le led – Cus ustomer r se serv rvice hig high on on rele levance Stro trong sal sales an and d Ret etentio ion-led mark ma rketin ing busin bus iness ena enabled by performance per technology tec bas based cu culture re 13 /
2017 Strategic review ITE view of the exhibitions industry Product-led Global Gl l Por ortfoli lio Region onal Em Emerg rging Mark rkets Specia ialis ists Players Developed Mar arket Region onal Speciali lists Dis isru rupters of of Ex Exis isting Sho hows (show form (sh formats or or ind ndustry nich niches) 14 /
2017 Strategic review Our vision “To create the world’s leading portfolio of content-driven, must-attend events deli livering an outstanding experience and ROI for our customers.” 15 /
TAG programme update 16 /
TAG – the Transformation and Growth programme TAG - the Transformation and Growth programme TAG Pro rogramme Cre reate a Manage Pro roduct-led Scalable Plat latform th the Portf tfolio Acquisitions Underpinned by a pe performance-led cu culture 17 /
TAG – the Transformation and Growth programme TAG programme Cre reate a a Sca calable Pla latform – best pr practice ap approach Cre reate be best practice fu functions & te teams Buil ild a fit fit for for purp rpose IT IT in infrastructure & sy syst stems Cha Change Invest in In in sh show operations Op Operating Model Mod Dri rive a perfo rformance ce cu cult lture Buil ild ca capability & ta tale lent 18 /
TAG – the Transformation and Growth programme TAG programme - Investment Ph Phasing 2017 : £6 -7m 7m 2018 : £8 -10m 10m 2019 : £4 -6m 6m Ran ange £20m One ne-off Co Costs Mix ix Investment by In y Transformation Lever Best Practice Infrastructure & Invest in Show Performance Capability & Capex Opex - Exceptional Systems Operations Culture Talent 19 /
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