ubm overview presentation - investis...

UBM Overview PresentationDavid Levin, CEORobert Gray, CFOAndrew Crow, Deputy CFOPeter Wrankmore, Head of Treasury

November 2009

2

Agenda

• Business overview and strategy

• Recent performance and outlook

• Capital and credit metrics

3

Business Overview and Strategy

4

• B2B communities– Events – exhibition led trade shows– Data, services & online– Print - magazines

• Targeting, Distribution & Monitoring

UBM: A global leader in B2B information and services

£291.8m

£225.3m

£215.6m

£154.3m

£82.2m

£31.1m

£23.9m

£43.3m

Targeting,Distribution& Monitoring

Print - Magazines

Data, services& online

Events

2008 Revenues 2008 EBIT 1

Market Cap (5 Nov ’09)

Net debt (30 Jun ’09)

Credit rating

£1,162m

£228.8m

Baa3 (stable)/BBB- (positive)

1 Excluding corporate operations

5

UBM’s strategy: focused, consistent, transparent• Focus on high quality revenue streams from specialist

communities:– Events– Data– Targeting, Distribution & Monitoring

• Target faster growing economies

• Proactively manage reduction of print portfolio

• Grow through a combination of organic expansion and acquisitions

6

Leading B2B evolution

22%

6%

56%

16%

24%

15%

46%

15%

29%

18%

36%

17%

30%

25%

27%

18%

33%

26%

24%

17%

32%

29%

20%

19%

2004 2005 2006 2007 2008 H1 2009Revenue

0

20

40

60

80

100%

Targeting,Distribution& Monitoring

Print -Magazines

Data, Services& Online

Events

2005-2008: Disposals £780m, Acquisitions £415m

Revenue composition:

7

Geographic growth orientation

6%8%

23%

17%

46%

6%

10%

20%

17%

48%

6%

12%

22%

23%

37%

4%

15%

16%

19%

46%

Revenue 2005

Revenue2008

Profit2005

Profit2008

£633.7m £887.0m £127.5m £180.5m

0

20

40

60

80

100%

US

ContinentalEurope

UKBIC Rest of world

1 Excluding corporate operations

1 1

8

Disciplined and transparent approach to mergers and acquisitions• £780m of disposals and £415m in acquisitions

completed 2005-2008

• 61 bolt-on acquisitions in adjacent businesses/geographies

• Four additional acquisitions completed 2009 YTD

• Key financial criterion: post-tax ROI exceeds 8% in first full year of ownership

• Cumulative pre-tax return 2005-2008 >12.5%*

* See appendix for definitions

9

Recent Performance and Outlook

10

Headline* financial results

1.40.9Net debt/EBITDA228.8181.1260.6157.5Net debt

H1Full Year

170.0

3.9

166.1

801.6

2007

171.5

(2.0)

173.5

887.0

2008

91.5

1.390.2

445.62008

1.5Interest and other finance income (£m)

79.8Adjusted PBT* (£m)

78.3Adjusted operating profit* (£m)435.0Revenue (£m)

2009

* See appendix for definitions

11

Segmental analysis Six months to 30 June

80.1

23.0

57.1

3.3

16.0

37.8

£m

2009

Adjusted Operating Profit*Revenue

2008120082009

(19.8)71.2(5.6)370.8350.1Total B2B Communities

14.420.113.574.884.9Targeting, Distribution & Monitoring

(76.1)13.8(22.3)111.086.3Print – Magazines

(12.3)

(8.6)

(5.3)

%

445.6

111.4

148.4

£m £m%£m

91.3

17.5

39.9(7.5)137.2Events

13.6126.6Data, Services & Online

435.0 (2.4)Total2

1 As restated 2 Excluding corporate operations

12

B2B Communities: Serving business communities with integrated media and services

WebsitesPrint

Social Networking

Business Information

Conferences

Professional Education

Workflow Solutions

Careers Fairs

Tradeshows

Professional CommunityCommunity Awards

13

Strength in key B2B verticals

Diversified by industry

2008 Revenue

2%2% 5%

6%

6%

6%

9%

9%

10%

17%

25%

3%Forest products & Paper

Games

IT Sales Channel

Fashion (Jewellery, Leather)

Ingredients (Food & Pharma)

Electronics & Semiconductor

Trade & Transportation

Built Environment

Lifestyle

Corporate IT

Health / Medical

Other

14

Events: Our key sector in B2B communities

(5.3)

(7.5)

Change %

28.226.927.6Operating Margin (%)

82.2

291.8

2008

39.937.8Operating Profit (£m)

148.4137.2Turnover (£m)

2008 1H2009 1H

45.5% of 2008 group profit

15

Global exhibitions: a $29 billion market

1.7

0.7

1.3

0.8

1.3

0.40.2

5.6

13

France UKSpain ItalyRussia ChinaBrazil InidaOther USGermany

Exhibitions market by geography

Source: AMR International, 2009

Exhibitions market by operator

%

4.13.1

2.11.8

1.51.5

1.41.41.31.21.01.00.90.90.90.90.7

71.6

0.70.5

UBM (1.6%)

Reed Exhibitions (UK) GL Events (France)Messe Frankfurt (Germany) Messe Düsseldorf (Germany)UBM (UK) Fiera Milano (Italy)Nielsen Business media (US) Deutsche Messe (Germany)Messe Müchen (Germany) EMAP (UK)Comexposium (France) DMG World media (UK)Koelnmesse (Germany) Advanstar (US)HKTDC (Hong Kong) Hanley Wood (US)Ifema (Spain) BolognaFiere (Italy)Fira Barcelona (Spain) ITE (UK)Other

%

16

Strong brands supported by UBM’s global platform

17

Predictability begins with on-site re-booking

CPhI 2009 Stand Revenue Bookings

70%

80%

90%

100%

Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct

18

Events: Forward orders for H2 2009 major events up 5.9%

1 2008 information provided for these shows2 Biennial, 2007 information provided for these shows

Exhibitor paid eventsExhibitor & attendee paid events

Location M onth

M ost Recent Edition

No of Attendees

H1 2009 EventsJune Jewellery & Gem Fair Hong Kong June 22 16,685CPhI China Shanghai June 8 26,863APLF – Fashion Spring Materials + Access Spring Hong Kong March 25 29,533International Beauty & Cosmetic Import-Export Expo Guangzhou March 30 20,165Game Developer Conference San Francisco March 22 17,393Interop Las Vegas April 23 10,698Seatrade Cruise Shipping Convention Miami March 25 10,154Voicecon Spring Orlando March 6 4,415ESC (West) San Jose April 20 8,001Informex USA San Francisco February 25 3,644Ifsec Birmingham January 36 14,959Interiors/Furniture Show London February 19 25,618International Confex London February 27 11,071

H2 2009 Events 1

September Jewellery & Gem Fair Hong Kong September 26 37,276Marintec 2 Shanghai December 14 35,309Furniture China Shanghai September 14 48,915Cosmoprof China November 13 39,467Health Ingredients Japan Tokyo October 11 19,992Health & Beauty America New York September 15 16,207Black Hat USA Las Vegas July 12 4,277CPhI Worldw ide Frankfurt October 19 23,454FIE 2 Frankfurt November 18 17,773

19

Data, Services & Online

(8.6)

13.6

Change %


31.1

225.3

2008


111.4126.6Turnover (£m)

2008 H12009 H117.2% of 2008

group profit

20

Data, Services & Online

Data

Online

Services

Key products:Informationweek.comChannelweb.comInternet EvolutionGamasutra

Key products:ICMIHDIPyramid Research

Key products:VIDALRISIOAGPiersABITechInsights

21

Print - Magazines

(76.1)

(22.3)

Change %

12.4

13.8

111.0

2008 H1

11.1

23.9

215.6

2008

3.8Operating Margin (%)

3.3Operating Profit (£m)

86.3Turnover (£m)

2009 H113.2% of ‘08group profit

22

Print - Magazines: Active portfolio management

Publ

icatio

ns

Reve

nue

Ope

ratin

g Pr

ofit

Publ

icatio

ns

Reve

nue

Ope

ratin

g Pr

ofit

Publ

icatio

ns

Reve

nue

Ope

ratin

g Pr

ofit

Publ

icatio

ns

2006 2007 2008 H1 2009

182£268m

£22m

155£231m

£28m

140

£216m

£24m

125

0

50

100

150

200

0

50

100

150

200

250

300

£mNumber of publications

23

Targeting, Distribution & Monitoring

14.4

13.5

Change %


43.3

154.3

2008


74.884.9Turnover (£m)

2008 H12009 H1

24% of 2008

group profit

24

•Coding•Formatting•Delivery into new systems•Credibility•Protection against hoax sources•Worldwide network•Simultaneity

TextMandatory newsPublicity news

MultimediaPhotosVideo

MNRs/Flex Release

Traditional MediaTrades

BroadcastAP / Reuters / Bloomberg

Social MediaBloggersYouTube

prnewswire.com social media tools

Databases & PortalsFactiva

Lexis-NexisYahoo

Financial NetworksThomson

BloombergReuters

AggregatorsAP

MarketwatchReuters

Corporate

Agencies

Government

Others

SOURCES CONTENT PROCESSING RECIPIENTS

Monitoring & Measurement Services

MEDIAtlasProfNet

SEO

PRN: Business Model

25

Press release demand is broad based

20%

28%

3%

1%

7%8%

5%3%5%

20%

New product/contractsAwardsLicencing

Personnelannouncements

Surveys & pollsTrade show newsOther general businessHealthcare/environmentCultural & publicRegulatory requirement

PR Newswire’s US Press Releases by Category (volume)

Source: Factiva/UBM

26

PRN: Investment in higher value –added products

Text only(per page)

Text and photo Multimedianews release

MEDIAtlas Strategicplacements

MediaRooom/IR Room

$680$1,375

$1,750$2,295

$8,495 $8,495

0

2,000

4,000

6,000

8,000

10,000

$

Indicative pricing for products

27

Capital and Credit Metrics

2828

0

50

100

150

200

250

300

350

400

450

2010 2011 2012 Total

£'m

CAD$26m Bilateral Loan (Amortising)

€53.1m Bilateral Loan Facility

£325m Revolving Credit Facility

£75m Floating Rate Reset Bond

Liquidity and Debt Profile – 30 June 2009

1 Minimum maturity

050

100150200250300350400450

Debt Liquidity

£'m

Undrawn FacilitiesCashNet DebtTotal Debt

Debt

Debt and Liquidity Debt maturity profile

1

1

29

Consistent cash conversion

Continuing businesses

100.1

173.6

2.2

(15.0)

186.4

12.9

173.5

2008

100.2

166.5

2.8

(12.6)

176.3

10.2

166.1

2007

90.8

81.9

(7.4)

(6.5)

95.8

5.6

90.2

H1 08

84.9EBITDA

113.8

89.1

10.9

(6.7)

6.6

78.3

H1 09

Depreciation

Cash conversion (%)

Operating cash inflow

Working capital/other

Capex

Adjusted operating profit*

£m

30

Cash flow

8.610.518.75.6Less: Tax

74.871.4150.7162.1

(275.3)

250.6

69.5

44.8

85.1

129.9

32.2

(1.2)

166.5

2007

(13.7)

61.5

7.3

55.1

48.1

103.2

47.5

4.2

173.6

2008

(15.8)

43.9

(1.0)

27.1

27.3

54.4

17.0

0

81.9

H1 08

53.6Discretionary cash

21.2Less: Restructuring payments

43.8Free cash flow

9.8Less: Net acquisitions

(2.5)

46.5

(0.2)

5.7

89.1

H1 09

Less: Net interest

Cash retained

Less: Dividends1

Less: Net share redemptions

Operating cash flow

£m

1 includes special dividend

31

Key investment considerations

• Leading positions and strong growth potential in key businesses

• Diversified revenues by both business and geography• Expanding geographic presence – Brazil, India and

China• Opportunities to make vertical acquisitions in a

fragmented market• Strong liquidity; conservative financial profile• Highly regarded management team with proven

execution

• Target: maintenance of investment grade credit

32

Credit Rating Views

Moody’s: Baa3 Stable Outlook S&P: BBB- Positive OutlookStrengths: “Established market positions in news distribution, trade shows, and professional media.Diversified product and service portfolio across a range of media and information services businesses.Established track record of strong cash conversion”

Positive Outlook: “The positive outlook reflects the potential for an upgrade in the first quarter of 2010 if, despite the difficult economic climate, UBM is able to demonstrate resilient operating performance and maintain a prudent balance sheet, resulting in adjusted FFO to debt in excess of 35% on a sustainable basis.”

Strengths: “… acknowledge the company’s solid positions in a range of business-to-business communications markets…… PR Newswire US recovered market share in H1 2009…… The company is now much less dependent on print products”

Stable Outlook: “…cost management steps taken by the company will help in shielding profits… bolt-on acquisitions will continue to add incremental revenue growth… UBM will continue to manage its discretionary outflows in line with its revised intention stated publicly of maintaining a prudent level of debt in 2009 and beyond”

33

Appendix

34

Definitions of Headline Indicators

• Headline and underlying measures are those which UBM considers to be the most meaningful and prudent measure of performance:

– headline results include foreign exchange gains

• Adjusted operating profit:– Before amortisation of intangible assets arising on acquisitions,

exceptional items and share of taxation on profit from joint ventures and associates

• Adjusted profit before tax and adjusted EPS: – Before amortisation of intangible assets arising on acquisitions,

exceptional items, share of taxation on profit from joint ventures and associates, net financing cost - other. Adjusted EPS also excludes deferred tax on the amortisation of intangible assets

• Reported profit before tax:– Before share of taxation of joint ventures and associates

On slides where “Headline” and “*” are used.

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