ITE Group plc
("ITE" or the "Group")
Interim Management Statement
ITE Group plc is today publishing its Interim Management Statement for the period from 1 April 2012 to 16 July 2012, incorporating the Group's third quarter trading period from 1 April 2012 to 30 June 2012.
Trading Performance
Trading conditions in our core markets remain as reported in our interim results statement of 21 May 2012 and the Group continues to trade in-line with management expectations. Revenues in the three month period to 30 June 2012 were £76.1m (2011: £79.4m). This year's result does not include a contribution from the biennial Moscow International Oil & Gas exhibition but does include first time contributions from Turkeybuild, which the Group acquired in July 2011, and from the spring events of the recently acquired Automotive and Beauty portfolios in Ukraine.
On a like-for-like basis revenues for the third quarter were approximately 3% lower than the previous year. The most significant influence on this was the performance of the Group's Mosbuild event in its biennially weaker year. The remainder of ITE's portfolio, excluding Mosbuild, delivered like for like revenue growth of circa 6% for the quarter.
The principal trading highlights in the third quarter were:
· Mosbuild, the Group's principal Moscow construction event faced a competitive launch this year. As expected it demonstrated its resilience to competition in delivering sales of 59,300 sqm (excluding the biennially impacted windows sector) a small reduction from the previous year's comparable event.
|
Event |
2012 sqm |
2011 sqm |
|
Mosbuild |
59,300 |
62,800 |
|
Windows Sector (Biennial element) |
6,700 |
14,800 |
|
Total Mosbuild event |
66,000 |
77,600 |
· Turkeybuild is the leading construction event in Turkey and takes place in May each year. This was the first edition under the Group's 60% ownership and the event, which is wall bound, delivered a 3% increase in selling 36,100sqm (2011: 35,00sqm). The result is in line with management expectations at the time of the acquisition.
· In Ukraine the first editions of the recently acquired Automotive and Beauty exhibitions were held and performed in line with the Group's expectations.
Business development
On 3 April 2012, ITE acquired Beautex Co LLC based in Kiev, Ukraine for a consideration of €8.6m (£7.2m). €6m was paid in cash on completion with a further payment of up to €2.6m payable over the next two years. Beautex runs two exhibitions each year, Intercharm and Beautyexpo, both of which serve the professional beauty trade and cosmetic & aesthetic industry in Ukraine.
During the quarter the Group completed two acquisitions in India. On 10 May 2012, the Group acquired the trade and exhibition assets of two events, Roof India and Hand Tools & Fasteners Expo from Chennai based Unitech Exhibitions pvt Ltd for 115m Indian rupees (£1.3m). On 24 May 2012, the Group acquired the trade and exhibition assets of a portfolio of six exhibitions from Mumbai based Conventions and Fairs for 110m Indian Rupees (£1.3m). These two acquisitions give the Group an expanded regional base of operations as well as adding critical mass to the Group's Indian business.
On 13 July 2012, the Group expanded its reach in the UK fashion sector with the purchase of 100% of the London based premium menswear event Jacket Required.
Financial position
The Group had net debt of £1.7m as at 13 July 2012, after spending circa £17m on acquisitions and deferred consideration during this financial year.
Outlook
Year to date, the Group has delivered solid organic growth supplemented by the contribution of new business acquired last year. As at 13 July 2012, the Group had £163.6m of sales booked for the current financial year (this time last year: £146.8m), representing approximately 96% of the consensus revenue expectations for this financial year. The Group continues to experience good trading conditions in its principal markets and the Board remains confident in the Group's prospects for the year.
