TIDMERM

RNS Number : 0243M

Euromoney Institutional InvestorPLC

19 May 2022

Euromoney Institutional Investor PLC

Half Year Results

19 May 2022

Strong revenue and profit growth

Positive short and medium-term outlook

Euromoney Institutional Investor PLC ("Euromoney" or "The Group"), the global B2B information-services provider, announces half year results for the six months to 31 March 2022.

Andrew Rashbass, CEO, said:

"Our strong first half performance provides clear evidence that we are moving at pace to being a fast-growing, high-margin, 3.0, information-services subscription business.

"Fastmarkets and Financial & Professional Services subscriptions grew strongly driven by increasing demand for our actionable data, analysis and intelligence. Within Asset Management we have met our target early of stabilising our Investment Research business. Demand for in-person events strengthened across the first half and bookings for the rest of the year are encouraging.

"We have entered the second half with confidence. While we are mindful of the macro and geopolitical landscape, our specialist businesses are performing well and we expect results for the full year to be ahead of the Board's previous expectations. Our confidence in our business supports a new medium-term outlook, targeting strong growth and a mid to high-twenties operating margin by 2025. "

 
                                                             Underlying 
Financial summary                       2022   2021  Change   change(1) 
                                        GBPm   GBPm 
-------------------------------------  -----  -----  ------  ---------- 
Revenue                                184.6  155.5   +19%      +14% 
Statutory operating profit               9.5   17.4  (45%) 
Adjusted operating profit (1)           40.2   34.8   +16%      +15% 
Adjusted operating profit margin (1)     22%    22%    - 
 
Statutory profit before tax              7.6   15.4  (51%) 
Adjusted profit before tax (1)          38.6   33.2   +16% 
Statutory diluted earnings per share    4.2p   6.1p  (51%) 
Adjusted diluted earnings per share 
 (1)                                   26.6p  24.6p   +8% 
 
Adjusted cash conversion (2)             90%   142% 
Net cash (1)                            12.5   24.8  (12.3) 
Total dividend per share                6.1p   5.7p   +7% 
-------------------------------------  -----  -----  ------  ---------- 
 
 
Strong performance 
      --  Group revenue up 14% on an underlying basis reflecting: 
                    Subscriptions up 8%: Fastmarkets +17%, Financial & Professional 
                o    Services (FPS) +5%, Asset Management +1% 
                o   Events revenue up 59% 
          Adjusted PBT up 16% reflecting strong revenue performance while continuing 
      --   to invest for future growth 
          Successful implementation of flexible working, group-wide property 
           rationalisation to deliver c.GBP5m of property savings per annum; 
      --   GBP19.1m H1 exceptional property charge 
      --  Strong balance sheet with net cash of GBP12.5m at 31 March 2022 
3.0 strategy is driving sustainable growth 
          Accelerating subscriptions growth - Book of Business(3) (BoB), a key 
           leading indicator for our subscriptions revenue, +8.1% at 31 March 
      --   2022 (31 March 2021: +3.5%). 
          Acquisition of Boardroom Insiders - a highly complementary addition 
           to our People Intelligence business which is unifying under the Altrata 
      --   brand 
          Asset Management - Investment Research stabilised earlier than planned; 
      --   investing to achieve sustainable growth 
          Events - strong demand for in-person events with many recent events 
      --   exceeding pre-pandemic equivalents 
Expecting significant revenue and margin growth to 2025 
          FY 2022: Results expected to be ahead of Board's previous expectations 
           supported by strong growth in subscriptions, further growth in events 
           and efficiency benefits, including c.GBP2.5m of property savings (c.GBP5m 
      --   benefit in FY 2023) 
          FY 2025 goals: 3.0 strategy expected to deliver high single to double-digit 
           underlying revenue CAGR from FY 2022 to 2025 and a significant improvement 
           in adjusted operating profit margin to the mid to high twenties by 
      --   2025 
 
 
      Adjusted measures exclude the impact of the amortisation of acquired 
       intangible assets, exceptional items and other adjusting items in accordance 
       with the Group's policy. A detailed reconciliation of the Group's adjusted 
       and underlying results, adjusted cash conversion and net cash is set 
 (1)   out on pages 12 to 20 of this statement. 
 
 (2)  Adjusted 12-month cash conversion % as set out on page 19. 
      Book of business (BoB) is the annual contracted values for subscriptions. 
       Like-for-like growth is calculated by adjusting prior periods with 
 (3)   a constant GBP/USD rate and the pro-forma impact of net M&A. 
      Certain figures included in this announcement have been subjected to 
       rounding adjustments. Accordingly, figures shown as totals in certain 
       tables may not be an arithmetic aggregation of figures that precede 
 (4)   them. 
 

Results presentation

A results presentation and Q&A will be hosted today, at 9.30am (UK time), for analysts and investors at the offices of FTI Consulting, 200 Aldersgate, London EC1A 4HD. A live audio webcast of the presentation and Q&A will also be available via the Investors section of our website at www.euromoneyplc.com, and subsequently available on demand.

We will be hosting a Teach-in for investors and analysts on Asset Management on 30 June 2022.

Our trading update for the nine months ended 30 June 2022 will be announced on 21 July 2022.

For further information, please contact:

Euromoney Institutional Investor PLC

Wendy Pallot, Chief Financial Officer: +44 (0)20 7779 8866; wendy.pallot@euromoneyplc.com

Christian Cowley, Investor Relations: +44 (0)7408 863420; christian.cowley@euromoneyplc.com

FTI Consulting

Jamie Ricketts / Tom Blundell / Lucy Highland: +44 20 3727 1000; sceuromoney@fticonsulting.com

NOTE TO EDITORS

Euromoney Institutional Investor PLC ("Euromoney") is a global B2B information-services business. We provide actionable data, analysis, intelligence and access through three divisions in markets where information and convening market participants are valued. Euromoney is listed on the London Stock Exchange and is a member of the FTSE 250 share index. ( www.euromoneyplc.com )

Group summary

The Group delivered a strong performance during the half driven by growth in both subscriptions and events revenue. We are moving at pace to being a fast-growing, high margin, 3.0 information-services subscription business.

Euromoney is a majority-subscriptions business. 69% of Group revenue during the half was generated from subscriptions which grew by 8% underlying and 12% on a reported basis. Underlying subscriptions revenue growth in Fastmarkets and FPS was 17% and 5% respectively. Asset Management subscriptions grew by 1% and we have met our stabilisation target early for the non-vote investment research BoB(3) . Across the Group, our subscriptions continue to achieve high renewal rates.

Events revenue, which accounted for 23% of Group revenue grew by 59% underlying and 65% on a reported basis. The return of in-person events led to a significant improvement in revenue performance in H1 2022 with total events revenue of GBP42.4m, an increase of GBP16.6m on H1 2021 when events were all virtual.

Overall, Group revenue increased by 14% underlying and 19% on a reported basis. Adjusted operating profit increased by 15% on an underlying basis with Group adjusted operating margin unchanged at 22%, or up 1 percentage point excluding the one-off GBP2.5m insurance claim receipt in H1 2021. Adjusted pre-tax profit increased by 16%. After the completion of the acquisition of Boardroom Insiders and the final dividend payment, net cash at 31 March 2022 was GBP12.5m (31 March 2021: GBP24.8m).

Revenue and adjusted operating profit

 
                                       H1 2022  H1 2021  Change  Underlying 
                                                                  (1) change 
                                       -------  ------- 
Revenue by division                       GBPm     GBPm 
Fastmarkets                               48.5     40.2   +20%      +21% 
FPS                                       79.8     58.3   +37%      +23% 
Asset Management                          55.2     56.0   (1%)      (1%) 
Foreign exchange gains on forward 
 contracts                                 1.1      1.0 
 
Revenue by type 
Subscriptions                            126.8    112.9   +12%       +8% 
Events                                    42.4     25.8   +65%      +59% 
Other                                     14.3     15.8   (9%)      (11%) 
Foreign exchange gains on forward 
 contracts                                 1.1      1.0 
Total                                    184.6    155.5   +19%      +14% 
                                       -------  ------- 
Divisional adjusted operating profit      56.4     46.1   +23%      +23% 
Foreign exchange gains on forward 
 contracts                                 1.1      1.0 
Central costs                           (17.3)   (12.3)  (41%)*    (44%)* 
 
Adjusted operating profit(1)              40.2     34.8   +16%      +15% 
Adjusted operating profit margin %         22%      22%   - ++ 
-------------------------------------  -------  -------  ------  ----------- 
 

* (-) (17% reported and -19% underlying excluding GBP2.5m insurance credit in H1 2021)

++ (+) (1ppt excluding GBP2.5m insurance credit in H1 2021)

Outlook for FY 2022

We have entered the second half of FY 2022 with confidence. Demand for price reporting and essential market intelligence remains strong. In Asset Management we have stabilised the performance of our Investment Research business. The Group BoB(3) , which is a key leading indicator for our subscriptions revenue, improved to 8.1% at 31 March 2022 (31 March 2021: 3.5%).

In events we are planning to host more in-person events in H2 than H1 and we are encouraged by booking patterns. As a result, we expect strong revenue growth in events for FY 2022.

We expect the combination of operating leverage on strong revenue growth and cost efficiencies, including the benefits from reducing our office footprint (c.GBP2.5m in FY 2022) to deliver results for FY 2022 that are ahead of the Board's previous expectations.

FY 2025 goals

Reflecting our increased confidence in the delivery of the 3.0 strategy we have set out our financial framework to FY 2025. During this period we expect to deliver a powerful combination of strong growth in subscriptions and events revenue as well as realising group-wide efficiencies.

By division we expect:

 
      --   Fastmarkets to deliver double-digit underlying subscriptions 
            revenue CAGR from FY 2022 to 2025 and an adjusted operating profit 
            margin in the high thirties reflecting continued success with 
            its data licencing strategy and product expansion. 
      --   FPS to deliver high single to double-digit underlying subscriptions 
            revenue CAGR from FY 2022 to 2025 and an adjusted operating profit 
            margin in the low thirties reflecting fast-growth and margin expansion 
            in its People Intelligence business and continued growth in events. 
      --   Asset Management to deliver low single-digit underlying subscriptions 
            revenue CAGR from FY 2022 to 2025 and an adjusted operating margin 
            in the mid-thirties reflecting the turnaround of Investment Research, 
            growth in its highly scalable Investment Solutions business and 
            growth from new products and services for the Wealth Management 
            sector. 
 

As a result we expect the Group to achieve a high single to double-digit revenue CAGR from FY 2022 to 2025 and a significant improvement in adjusted operating profit margin to the mid to high twenties by FY 2025. A summary of expectations is detailed in the following table and further commentary by division is provided in the operating and financial review.

Summary of financial expectations

 
                     FY 2021 Actual            FY 2022 Expectations         CAGR FY 2022-2025    FY 2025 
Division           Revenue  Margin(1)    Revenue(2)         Margin(1)          Revenue(2)       Margin(1) 
                     GBPm 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
Fastmarkets 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
Subscriptions       79.8        -       Double digit            -             Double digit          - 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
Total               85.4       36%            -              Stable                 -           High 30s 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
FPS 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
                                         Mid single                          High single to 
Subscriptions       87.1        -           digit               -              double digit         - 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
                                                            Increase 
Total               138.4      18%            -              vs 2021                -            Low 30s 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
Asset Management 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
Subscriptions       67.6        -          Stable               -           Low single digit        - 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
                                                           Decline vs 
                                                         2021 reflecting 
Total               109.8      39%            -         growth investments          -            Mid 30s 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
Group 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
                                         Mid to high                         High single to 
Subscriptions       234.5       -        single digit           -              double digit         - 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
Events              60.9        -       Strong growth           -             Double digit          - 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
                                                                              Decreasing as         - 
Central costs               GBP(34.6)m                     c.GBP(40)m          % of revenue 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
                                                            Increase         High single to    Mid to high 
Total               336.1      19%      Double digit          v 2021           double digit        20s 
                   -------  ----------  -------------  -------------------  -----------------  ----------- 
 
 
 (1)   (Adjusted operating margin. Adjusted measures exclude the impact 
        of the amortisation of acquired intangible assets, exceptional items 
        and other adjusting items in accordance with the Group's policy.) 
 (2)   (Underlying revenue growth) 
 

Other guidance

 
 Costs 
      --   Property rationalisation in UK and US expected to deliver c.GBP2.5m 
            of savings in FY 2022; c.GBP5m in FY 2023 
      --   H1 2022 exceptional costs relating to property rationalisation 
            of GBP19.1m 
      --   Central costs expected to decrease as a percentage of revenue from 
            FY 2022 to FY 2025 
 
 Tax rate 
      --   Group adjusted effective tax rate expected to be c.23% for FY 2022 
            (previously c.21%) due to a non-recurring disallowance of interest 
            expense (no change to cash tax rate of 21% expected for FY 2022) 
      --   Group adjusted effective tax rate expected to be c.22% for FY 2023 
 
 Cash flow 
      --   Capital expenditure of GBP6m for FY 2022 reflecting continued investment 
            in technology and systems 
      --   c.GBP9-10m of property rationalisation costs in H2 2022 (including 
            lease surrender and subletting costs) 
 

Strategy update

We help our customers compete successfully by providing clarity in opaque markets. We provide actionable data, analysis, intelligence and access to markets covering commodities, telecoms, financial and professional services, and asset management. Our 3.0 strategy is to provide information services embedded in customers' critical workflow. These are characterised by resilient and robust recurring subscriptions revenue. We have a record of successful organic investment and of acquiring good 3.0 businesses where our ownership adds significant value. Our ESG focus areas are also integral to our strategy and we are progressively embedding them across the Group. We deliver our strategy through three divisions and we use our group scale to share capabilities and platforms across our divisions to increase efficiency and enable our divisions to focus on customers. The strength of our business model and our subscriptions business has been demonstrated by our strong subscription performance during the pandemic. Our goal is to be a fast-growing, high margin, 3.0 information-services subscription business.

The Group has five short-term strategic priorities to enable the delivery of the 3.0 strategy:

   1)    Organic investment in 3.0 opportunities 
   2)    3.0 acquisitions 
   3)    Return Investment Research to growth 
   4)    Strong post-covid blended events, moving towards a 3.0 membership model 

5) Standardise platforms, processes and policies for an efficient, inclusive, and diverse company

The following section provides updates on each of our five priorities:

   1)    Organic investment in 3.0 opportunities 

Fastmarkets has a leading position in pricing data for raw materials in renewable-energy markets. During the half we continued our expansion of coverage in battery raw material markets with a particular focus on use in electric vehicles (EV) and energy storage systems. Fastmarkets is also partnering with the Singapore Exchange (SGX), the Chicago Mercantile Exchange (CME) and the London Metal Exchange (LME) to launch four battery raw material futures contracts which will be settled against Fastmarkets' prices. The suite of contracts will include cobalt metal, cobalt hydroxide, lithium carbonate and lithium hydroxide. These derivative contracts will facilitate market participants to manage price risk exposures to commodities crucial to the battery and electric vehicle EV industries. In FY 2022 we continue to audit more of our prices for compliance with the IOSCO Principles for price reporting agencies (51 prices at 31 March 2022 versus 43 at 30 September 2021). The Fastmarkets BoB(3) improved to 14.8% growth at 31 March 2022 (31 March 2021: 8.2%).

FPS continues to invest to drive growth in subscriptions. Areas of investment include people (eg market specialists and sales and marketing), technology (eg rollout of a single publishing platform) and new products (eg content delivery via API and data visualisation tools). We continue to drive efficiency and scale across the division and delivered an improvement in the FPS BoB(3) which grew by 8.7% at 31 March 2022 (31 March 2021: 4.2%) .

Asset Management's investment in sales and systems has continued to drive improved retention in our research business with the 12-month moving average renewal rate at 31 March 2022 increasing to 91% (31 March 2021: 89%). During the half we started our investment in access and intelligence solutions for the Wealth Management industry including research, networking, education, communications support and model portfolios (Investment Solutions). The total Asset Management BoB(3) decline improved to -0.3% at 31 March 2022 (31 March 2021: -2.1%).

   2)    3.0 acquisitions 

Acquisitions are a core part of the Group's strategy. We further strengthened our People Intelligence business with the acquisition of Boardroom Insiders in January 2022 for $25m. Boardroom Insiders is a market-leading provider of people intelligence to technology companies and professional services. The business has profiles on over 30,000 executives and key decision makers. These profiles, and the intelligence provided from its proprietary analytics capability, are primarily used by sales teams for business development and account management purposes. In May 2022 we launched a rebrand of our People Intelligence business under the single brand Altrata. Euromoney's People Intelligence BoB(3) at 31 March 2022 was GBP48m, approximately half of FPS's total BoB(3) , and grew by 12% year on year.

   3)    Return Investment Research to growth 

The turnaround of our Investment Research business has been achieved earlier than planned. In June 2020 we set a target of growing the non-vote Investment Research Book of Business by the end of FY 2022. At 31 March it increased by 0.6% and has been growing since December 2021. The turnaround has been driven by a higher renewal rate following investment in the sales team and in auto-renewals, integration of sales teams to drive cross-selling and new research products. Investment Solutions, which embeds our data and intellectual property into investment decision making processes, has also contributed to the turnaround and continued its rapid growth of assets under advisement (AUA) reaching $2.1bn at 31 March 2022 (31 March 2021: $1.6bn).

   4)    Strong post-covid blended events, moving towards a 3.0 membership model 

The continuing need for industries to convene, network and transact in-person has driven very strong year-on-year growth in events revenue in H1 2022. The performance of our blended events versus their pre-pandemic equivalent strengthened across the period as covid-related restrictions were lifted. During the half we hosted 96 blended events and 26 virtual events versus an all-virtual comparison of 206 events in H1 2021. Geographically our events are focused on North America (approximately half) and Europe (approximately one third) which are both areas with high vaccination rates and relatively fewer travel restrictions. During the half we have seen an improvement in booking trends and are encouraged by the outlook for events in H2.

At Institutional Investor (II) our events membership model, in which members pay an annual fee to participate in a number of events and receive other access and intelligence opportunities, has proved relatively resilient during the pandemic. H1 2022 Institutional Investor membership revenue was two thirds of H1 2019. As in-person events have returned we have seen II memberships growing again which we expect to be reflected in future revenue growth.

   5)    Standardise platforms for an efficient, inclusive, and diverse company 

We continue to use the Group's scale to support our businesses and drive efficiency by rolling out standardised platforms. During the first half, we extended our coverage of strategic cloud-based solutions for finance, customer relationship management and events management. We completed the migration of our corporate data centres to a strategic public cloud partner. This means our corporate hosting is now carbon neutral and significantly more cost effective. We completed the roll out of an AI-based advanced threat protection system to mitigate the risk of cyber-attacks, such as phishing and ransomware, monitored continuously by our security operations centre.

Our ESG focus areas

In FY 2021 we identified five ESG focus areas that are important to us and are integral to our strategy. We continue to embed our ESG framework across the business. We have defined relevant KPIs and are tracking our progress.

1) Workforce inclusion, diversity and well-being: The value we create for customers comes from the work our people do every day. We need to employ the best talent, and we recognise that talent is to be found in all demographics. However, it is not enough just to have the right people - we want them to achieve their full potential and thrive at Euromoney. To do this, they need to feel they belong; to be motivated, engaged and empowered; and have their physical and mental well-being needs supported. Since October 2021 we have successfully introduced Working 3.0 which allows every colleague to choose where they work and, secondly, the ability to start their weekend at Friday lunchtime. This extra flexibility has received strong support from colleagues and means our recruitment talent pool in an increasingly challenging labour market is not limited by geography. Working 3.0 has also enabled us to rationalise our office footprint and we expect to realise a sustainable reduction in property costs.

2) Data and information security and privacy: Proprietary data, analysis, news and insights are the foundation of our customer offer. For this information to be valuable it must be accurate, useful, and legal. Among other guarantors of quality, we therefore need to deliver the highest standards of information security and privacy. As we also hold information on our customers and our sector communities, we need to be trusted to safeguard this data securely and use it responsibly. During the half we have strengthened our framework for the responsible use of personal data in a way that is lawful, fair, ethical and accountable. This has focused on developing and maintaining a clear understanding of our processing activities; strong leadership and oversight; effective training and awareness and effective use of our privacy expertise.

3) Transparency, ethics, governance, and risk management: We facilitate efficient markets by providing data and insights. We also believe in the contribution business makes to society. Efficient markets and fulfilling societal responsibilities also require that market participants operate with transparency, adopt ethical practices, establish strong governance frameworks and manage risk robustly. During H1 2022 we launched our Code of Business Conduct and held a series of awareness briefings for colleagues.

4) Encouraging strong ESG practices in the markets we serve: As well as the actions we take internally, we believe that we are well placed to shape good ESG practices in the markets we serve through raising the profile of ESG matters such as inclusion and diversity and climate change, and by expanding our footprint in ESG-related areas. In December 2021 Euromoney became a signatory of the Net Zero Carbon Events Pledge which was launched at COP26 in Glasgow. In Fastmarkets we continue to promote our environmentally friendly prices (eg scrap and secondary prices and energy transition products).

5) Reducing our climate impact: We are not a high-carbon emitting organisation, but we recognise the need to play our part and reduce both our climate and other environmental impacts. We aim to be leaders in running environmentally sustainable events through appropriate sourcing and waste reduction and by lowering the carbon footprint per attendee. We continue to look for ways to reduce energy use in our offices and our equipment. During FY 2021 we reviewed and improved the robustness of our Scope 1 and 2 emissions data. We have now achieved our target of carbon-neutral status for our FY 2021 Scope 1 and Scope 2 emissions by purchasing high-quality offsets and continue to work on the Group's strategy to Net Zero for Scopes 1, 2 and 3.

Operating and financial review

When reviewing performance, the Board considers a number of adjusted performance measures, as set out on pages 12 to 20.

The Group operates through three divisions: Fastmarkets, Financial & Professional Services (FPS) and Asset Management.

Fastmarkets: 26% of Group revenue

Fastmarkets is Euromoney's price reporting agency. It provides commodity price benchmarks and analysis critical to our customers' business processes and workflows. Fastmarkets provides prices across the supply chain from the source of the commodity to recycling in the metals, mining, forest products and agriculture markets. Its business model benefits from high barriers to entry and it operates in markets with significant opportunity for long-term growth.

 
                                     H1 2022  H1 2021  Change  Underlying(1) 
                                                                   change 
                                     -------  ------- 
Revenue                                 GBPm     GBPm 
Subscriptions                           44.0     37.6   +17%       +17% 
Events                                   3.0      1.3  +129%       +148% 
Other                                    1.5      1.3   +14%        +4% 
Total                                   48.5     40.2   +20%       +21% 
                                     -------  ------- 
Adjusted operating profit (1)           19.8     15.3   +30%       +37% 
Adjusted operating profit margin % 
 (1)                                     41%      38%  +3ppt 
-----------------------------------  -------  -------  ------  ------------- 
 

Fastmarkets revenue increased by 21% underlying driven by a very strong performance in subscriptions. On a reported basis revenue increased by 20%.

Subscriptions revenue, which is 91% of divisional revenue, grew by 17% on an underlying and reported basis driven largely by growth in Metals and Mining and Forest Products. The subscription BoB(3) increased by 14.8% year-on-year at 31 March 2022. This represents a strong improvement on the 8.2% year-on-year growth at 31 March 2021. This acceleration has been driven largely by a combination of increased sales of data licences and cross-selling of additional data sets to existing clients as well as sales to new customers.

Events revenue, which is 6% of divisional revenue, more than doubled on an underlying and reported basis, reflecting the return of in-person events. Other revenue, which is 3% of divisional revenue, increased by 4% underlying and 14% on a reported basis.

Adjusted operating profit increased by 37% underlying reflecting the very strong growth in high margin subscriptions revenue. On a reported basis adjusted operating profit increased by 30%.

Financial & Professional Services (FPS): 44% of Group revenue

FPS provides essential and actionable data, people and market intelligence, accreditation, marketing services, and events to financial and professional services businesses. FPS also delivers embedded workflow solutions and business development services. It combines a complementary portfolio of well-known industry brands that operate within four pillars: People Intelligence (Altrata), NextGen, Derivatives, and Events.

 
                                     H1 2022  H1 2021  Change  Underlying(1) 
                                                                   change 
                                     -------  ------- 
Revenue                                 GBPm     GBPm 
Subscriptions                           48.7     41.4   +18%        +5% 
Events                                  24.8      9.1  +173%       +144% 
Other                                    6.3      7.8  (19%)       (22%) 
Total                                   79.8     58.3   +37%       +23% 
                                     -------  ------- 
Adjusted operating profit (1)           16.2      8.3   +96%       +80% 
Adjusted operating profit margin % 
 (1)                                     20%      14%  +6ppt 
-----------------------------------  -------  -------  ------  ------------- 
 

FPS revenue increased by 23% underlying driven by the return of in-person events and continued growth in subscriptions. On a reported basis revenue increased by 37% reflecting the impact of the acquisitions of Wealth Engine, RelSci and Boardroom Insiders.

Subscriptions revenue, which is 61% of divisional revenue, increased by 5% underlying benefiting from strong growth in People Intelligence and by 18% on a reported basis. Renewal rates for the division remained high during the period, demonstrating the essential nature of the data, specialist insight and solutions we provide. The subscription BoB(3) increased by 8.7% year-on-year at 31 March 2022 and more than double the 4.2% year-on-year growth at 31 March 2021.

Events revenue, which is 31% of divisional revenue, grew by 144% underlying and 173% on a reported basis as in-person events returned. During the half FPS ran 56 blended events and 18 virtual events in comparison with 142 virtual events in H1 2021. In H1 2020 FPS hosted 118 in-person events. Major events during the period included Capacity Europe, Capacity Middle East, ABS East, Single Family Rental Investment (West), Build-to-Rent East and Metro Connect, all of which achieved higher revenues than their pre-pandemic equivalent.

Other revenue, which consists of research and rankings, advertising, consultancy and thought leadership, and is 8% of divisional revenue, decreased by 22% underlying and by 19% on a reported basis largely reflecting phasing of client projects, which is weighted towards H2 2022.

Adjusted operating profit increased by 80% on an underlying basis reflecting the return of in-person events and continued growth in high margin subscriptions. On a reported basis adjusted operating profit increased by 96%.

We further strengthened our People Intelligence business with the acquisition of Boardroom Insiders in January 2022. In May 2022 we announced that we are unifying our People Intelligence business under the Altrata brand.

Asset Management: 30% of Group Revenue

Asset Management includes our brands and businesses that serve the global asset management industry and broader financial community: BCA Research, Ned Davis Research (NDR) and Institutional Investor. This division provides independent research that enables our clients to make informed investment decisions, runs networks and conferences that bring asset allocators and asset managers together in an effective and efficient way and provides news and data that are critical for the industry to stay informed and make deals.

 
                                     H1 2022  H1 2021  Change  Underlying(1) 
                                                                   change 
                                     -------  ------- 
Revenue                                 GBPm     GBPm 
Subscriptions                           34.1     33.9   +1%         +1% 
Events                                  14.6     15.4   (5%)       (5%) 
Other                                    6.5      6.7   (2%)         - 
Total                                   55.2     56.0   (1%)       (1%) 
                                     -------  ------- 
Adjusted operating profit (1)           20.4     22.5   (9%)       (9%) 
Adjusted operating profit margin % 
 (1)                                     37%      40%  (3ppt) 
-----------------------------------  -------  -------  ------  ------------- 
 

Asset Management revenue declined by 1% on an underlying and reported basis mainly reflecting the decline in events revenue.

Subscriptions revenue, which is 62% of divisional revenue, increased by 1% on an underlying and reported basis. This compares with a 5% underlying decline in H1 2021.

We have achieved our target early of returning the non-vote Investment Research subscription BoB (3) to growth by the end of FY 2022. The turnaround was driven by a higher renewal rate following investment in the sales team and in auto-renewals, integration of sales teams to drive cross-selling, and new research products. The 12-month moving average renewal rate at 31 March 2022 increased to 91% (31 March 2021: 89%).

Investment Solutions, which embeds our data and intellectual property into investment decision making processes, has also contributed to the turnaround and continued its rapid growth of assets under advisement (AUA) reaching $2.1bn in 31 March 2022 (31 March 2021: $1.6bn).

Events revenue, which is 26% of divisional revenue, decreased by 5% on an underlying and reported basis. Institutional Investor (II) Membership revenue grew versus H2 2021 and we are planning to hold significantly more physical events in H2 2022 which we expect will drive growth in II Memberships and growth in other events.

Other revenue, which includes II research reports and media, and is 12% of divisional revenue, was unchanged underlying and declined by 2% on a reported basis.

Asset Management adjusted operating profit decreased by 9% on an underlying and reported basis reflecting investment in growth initiatives including the return of in-person events and Wealth Management.

Revenue, adjusted operating profit and adjusted profit before tax

 
                                        H1 2022  H1 2021  Change  Underlying(1) 
                                                                      change 
                                        -------  -------  ------ 
Revenue by division                        GBPm     GBPm 
Fastmarkets                                48.5     40.2   +20%       +21% 
FPS                                        79.8     58.3   +37%       +23% 
Asset Management                           55.2     56.0   (1%)       (1%) 
Foreign exchange gains/(losses) on 
 forward contracts                          1.1      1.0 
Total revenue                             184.6    155.5   +19%       +14% 
Adjusted operating profit by division 
Fastmarkets                                19.8     15.3   +30%       +37% 
FPS                                        16.2      8.3   +96%       +80% 
Asset Management                           20.4     22.5   (9%)       (9%) 
--------------------------------------  -------  -------  ------  ------------- 
Divisional adjusted operating profit       56.4     46.1   +23%       +23% 
--------------------------------------  -------  -------  ------  ------------- 
Foreign exchange gains/(losses) on 
 forward contracts                          1.1      1.0 
Central costs                            (17.3)   (12.3)  +41%*       +44%* 
--------------------------------------  -------  -------  ------  ------------- 
Adjusted operating profit(1)               40.2     34.8   +16%       +15% 
Adjusted operating profit margin %          22%      22%   - ++ 
Associates and JVs                          0.2      0.1 
Net finance costs                         (1.8)    (1.7) 
Adjusted profit before tax                 38.6     33.2   +16% 
                                        -------  -------  ------ 
 

* (-17% reported and -19% underlying excluding GBP2.5m insurance credit in H1 2021)

++ (+1ppt excluding GBP2.5m insurance credit in H1 2021)

Group revenues increased by 14% underlying and 19% on a reported basis, reflecting the return of in-person events and continued growth in subscriptions revenue. Central costs increased by 44% underlying or 41% on a reported basis reflecting in part a one-off GBP2.5m insurance claim receipt in H1 2021. Excluding this insurance claim receipt central costs increased by 19% underlying and 17% reported largely reflecting investment in group-wide systems, higher travel costs, and higher insurance premiums. This resulted in adjusted operating profit underlying growth of 15% to GBP40.2m and 16% on a reported basis. Adjusted operating profit margin was unchanged at 22% or up 1 percentage point excluding the one-off GBP2.5m insurance claim receipt in H1 2021. Adjusted profit before tax increased by 16% to GBP38.6m mainly reflecting higher adjusted operating profit. Adjusted diluted earnings per share increased by 8% to 26.6p (H1 2021: 24.6p), lower than the growth in adjusted profit before tax, reflecting a temporary increase in the effective tax rate which is described in the tax section. Statutory profit before tax has reduced GBP7.8m to GBP7.6m (31 March 2021: GBP15.4m). This is principally driven by exceptional charges that have increased by GBP12.3m to GBP20.3m (31 March 2021: GBP8.0m) as a result of property rationalisation costs incurred in the first half and higher acquired intangible asset amortisation from the Group's recent acquisitions. This has been partially offset from the improvement in underlying performance as reflected in the adjusted results.

Other financial items

Exceptional items

In H1 2022 total exceptional costs were GBP20.3m. Following the successful introduction of flexible working across Euromoney, we have reviewed our real estate requirements across the Group and have identified significant opportunities to reduce our office costs in London and New York to reflect the footprint that suits our needs. As a result, exceptional impairments of GBP19.1m were booked against right of use assets and other fixed assets.

Other exceptional costs of GBP1.2m consist of expenditure associated with the acquisition of AgriCensus, WealthEngine, The Jacobsen, RelSci and Boardroom Insiders which is treated as exceptional due to its magnitude.

The cashflow impact of exceptional items for H1 2022 was an outflow of GBP1.7m.

Tax

The adjusted effective tax rate for the period ended 31 March 2022 is 25% (FY 2021: 20%) which is based on adjusted profit before tax and excludes deferred tax movements on intangible assets, tax on exceptional items, prior year items and other tax adjusting items as described below. The tax rate in each year depends mainly on the geographic mix of profits as well as on applicable tax rates and although the tax charge involves a level of estimate, we currently expect it to be c.23% for FY 2022. The adjusted effective tax rate is higher than the prior year (FY 2021: 20%) due to a non-recurring disallowance of interest expense for US tax purposes. This disallowance does not impact the Group's cash tax rate for the current period. For FY 2023 we expect the adjusted effective tax rate to be c.22% reflecting the increase in UK corporation tax rate from 19% to 25% from 1 April 2023.

The Group's statutory effective tax rate is 40% for the period ended 31 March 2022. The statutory effective tax rate is largely driven by one off non-deductible expenses for tax purposes such as costs relating to M&A transactions, the non-recurring disallowance of interest expense noted above and general provisions relating to the Group's decision to vacate of some of its office spaces in London and New York.

The basis for the calculation of both effective tax rates and further information can be found in note 6.

Dividend

The Board has declared an interim dividend of 6.1p per share, a 7% increase year-on-year (H1 2021: 5.7p) reflecting the strong balance sheet, cash generative nature of the business and confidence in the future. Our dividend policy is to pay out approximately 40% of full year adjusted diluted earnings per share, subject to the capital needs of the business. The interim dividend is one third of the prior year's total dividend. The dividend will be paid on 24 June 2022 to shareholders on the register at the close of business on 27 May 2022.

Net cash and cash flow

A reconciliation of free cash flow, an alternative performance measure, and cash generated from operations and net cash flow, the nearest statutory measures, is set out below.

 
                                       H1 2022   H1 2021   Change 
                                          GBPm      GBPm     GBPm 
-----------------------------------  ---------  --------  ------- 
 Cash generated from operations           29.7      39.5    (9.8) 
 Leases and interest                     (5.3)     (5.3)    (0.0) 
 Capex                                   (2.2)     (2.9)      0.7 
 Taxation                               (12.5)     (1.2)   (11.3) 
                                     ---------  --------  ------- 
 Free cash flow                            9.7      30.1   (20.4) 
                                     ---------  --------  ------- 
 Dividends paid                         (13.5)    (12.3)    (1.2) 
 Net M&A                                (16.6)    (20.2)      3.6 
                                     ---------  --------  ------- 
                                        (20.4)     (2.4)   (18.0) 
                                     ---------  --------  ------- 
 Opening cash and cash equivalents        32.5      28.1      4.4 
 Currency translation                      0.4     (0.9)      1.3 
                                     ---------  --------  ------- 
 Closing net cash                         12.5      24.8   (12.3) 
-----------------------------------  ---------  --------  ------- 
 

Net cash at 31 March 2022 was GBP12.5m which excludes lease liabilities, compared with GBP24.8m as at 31 March 2021. This decrease in net cash largely reflects the acquisition of Boardroom Insiders in January 2022 for GBP16.6m and the payment of Canadian withholding tax of GBP5.4m.

The Group's adjusted cash conversion for H1 2022 was 90% (H1 2021: 142%). We expect adjusted cash conversion to increase in H2 2022 as we collect cash from a higher number of subscriptions contracts that were signed in Q2 2022 than in the prior year as well as for events held at the end of Q2 2022. See page 19 for the calculation. The Group has a strong and consistent record of high cash conversion reflecting the robust nature of the Group's subscription businesses and the relatively capital light business model.

Management of balance sheet and liquidity risk and financing

The Group regularly reviews the level of cash and debt facilities required to fund its activities. In May 2021, the Group refinanced and increased its existing bank facility which included two additional one-year extension options. The first of these options was exercised in April 2022, resulting in a committed multi-currency revolving credit facility of GBP190m being available to the Group until May 2025. An additional GBP130m uncommitted accordion facility also remains available.

Currency

The Group generates approximately 75% of its revenue in US dollars, including approximately 40% of its UK revenue and c.90% of the Group's operating profit. The exposure to US dollar revenue in the UK businesses is partially hedged using forward contracts to sell US dollars, which delays the impact of movements in exchange rates for at least a year.

The average sterling-US dollar rate for the six months to 31 March 2022 was $1.35 (2021: $1.34). This reduced reported revenue growth rates for the year by approximately one percentage point and adjusted profit before tax by GBP0.8m. Each one cent movement in the US dollar rate has an impact on translated profits, net of UK revenue hedging, of approximately GBP0.8m on an annualised basis. The Group also translates its non-sterling denominated balance sheet items, which resulted in a gain in 2022 of GBP0.1m (2021: GBP0.1m loss ).

Definitions

Adjusted measures exclude the impact of amortisation of acquired intangible assets, exceptional items and other adjusting items in accordance with the Group's policy. A detailed reconciliation of the Group's adjusted and underlying results is set out in the Appendix on pages 12 to 20 of this statement.

Underlying measures are the adjusted results stated at constant exchange rates, including pro forma prior year comparatives for acquisitions and new business launches and excluding disposals or business closures, including adjustments for significant event timing differences, and including proforma prior year adjustments for the application of new accounting standards.

CAUTIONARY STATEMENT

This Half Year Report ("Statement") is prepared for and addressed only to the Company's shareholders as a whole and to no other person. The Company, its Directors, employees, agents and advisers accept and assume no liability to any person in respect of this Statement save as would arise under English law. Statements contained in this Statement are based on the knowledge and information available to the Group's Directors at the date it was prepared and therefore facts stated and views expressed may change after that date.

This document and any materials distributed in connection with it may include forward-looking statements, beliefs, opinions or statements concerning risks and uncertainties, including statements with respect to the Group's business, financial condition and results of operations. Those statements and statements which contain the words "anticipate", "believe", "intend", "estimate", "expect" and words of similar meaning, reflect the Company's Directors' beliefs and expectations and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and which may cause results and developments to differ materially from those expressed or implied by those statements and forecasts. No representation is made that any of those statements or forecasts will come to pass or that any forecast results will be achieved. You are cautioned not to place any reliance on such statements or forecasts. Those forward-looking and other statements speak only as at the date of this Statement. The Group undertakes no obligation to release any update of, or revisions to, any forward-looking statements, opinions (which are subject to change without notice) or any other information or statement contained in this Statement. Furthermore, past performance of the Group cannot be relied on as a guide to future performance.

No statement in this document is intended as a profit forecast or a profit estimate and no statement in this document should be interpreted to mean that earnings per Euromoney Institutional Investor PLC share for the current or future financial years would necessarily match or exceed the historical published earnings per Euromoney Institutional Investor PLC share.

Nothing in this document is intended to constitute an invitation or inducement to engage in investment activity. This document does not constitute or form part of any offer for sale or subscription of, or any solicitation of any offer to purchase or subscribe for, any securities nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract, commitment or investment decision in relation thereto. This document does not constitute a recommendation regarding any securities.

LEI Number: 213800PZU2RGHMHE2S67

Glossary to Half Year Report

In order to fully explain the performance of the business, the Group uses several alternative performance measures (APMs) and business KPIs. APMs are non-GAAP and not defined by IFRS; therefore, they may not be considered directly comparable to other companies' APMs. APMs should be considered in addition to, rather than a substitute for, IFRS measures.

The Group presents two main sets of APMs in its Annual Report and financial results: adjusted measures and underlying measures.

Adjusted measures

Adjustments principally include the amortisation of acquired intangible assets, exceptional items, net movements in deferred consideration and acquisition commitments, fair value remeasurements and the associated tax thereon.

Adjusted measures provide additional useful information for shareholders to evaluate and compare the performance of the business from period to period. Management use these for budgeting, planning and monthly reporting purposes and they are the basis on which executive management is incentivised. These adjusted measures also enable the Group to track more easily and consistently the underlying operational performance by separating out exceptional income, charges and non-cash items.

The Group also presents adjusted EBITDA because the Group's borrowing facilities contain certain EBITDA related covenants, including the ratio of adjusted net cash to EBITDA.

Underlying measures

Underlying measures are adjusted measures which have been additionally adjusted for the impact of foreign exchange movements, M&A, new business launches, business closures, material events that move across reporting dates, material biennial events and the application of new accounting standards.

Underlying measures provide a fairer like-for-like comparison than adjusted measures as the factors noted above can influence growth rates but do not reflect underlying business performance.

 
                             Closest equivalent 
 APM/KPI term                 IFRS measure               Purpose and definition 
 Underlying revenue(1)       Revenue                     Underlying revenue (and underlying 
                                                          revenue growth) enable us to compare 
                                                          revenue on a like-for-like basis 
                                                          and are an important indicator of 
                                                          the health and trajectory of our 
                                                          divisions and the Group as a whole. 
                                                          Underlying revenue adjusts for the 
                                                          impact of foreign exchange movements, 
                                                          M&A, new business launches, business 
                                                          closures, material events that move 
                                                          across reporting dates, material 
                                                          biennial events and the application 
                                                          of new accounting standards . 
                                                          Underlying revenue growth is one 
                                                          of the financial measures used for 
                                                          Directors' remuneration. 
                            --------------------------  -------------------------------------------- 
 Adjusted operating          Operating profit(3)         Adjusted operating profit enables 
  profit(1)                                               the Group to more closely track 
                                                          operational performance by adjusting 
                                                          operating profit for the amortisation 
                                                          of acquired intangible assets and 
                                                          exceptional items. 
                            --------------------------  -------------------------------------------- 
 Adjusted operating          Operating profit(3)         Adjusted operating profit margin 
  profit                      margin                      measures the efficiency of the Group 
  margin                                                  and the effectiveness of investment 
                                                          decisions, cost reduction efforts 
                                                          and mix improvements. Adjusted operating 
                                                          profit margin is calculated as adjusted 
                                                          operating profit as a percentage 
                                                          of revenue. 
                            --------------------------  -------------------------------------------- 
 Underlying operating        Operating profit(3)         Underlying operating profit enables 
  profit(1)                                               the Group to compare operating profit 
                                                          on a like-for-like basis. Underlying 
                                                          operating profit adjusts adjusted 
                                                          operating profit for the impact 
                                                          of foreign exchange movements, M&A, 
                                                          new business launches, business 
                                                          closures, material events that move 
                                                          across reporting dates, material 
                                                          biennial events and the application 
                                                          of new accounting standards . 
                            --------------------------  -------------------------------------------- 
 Adjusted EBITDA             Operating profit(3)         Adjusted EBITDA is a measure used 
  for covenant purposes(1)                                in covenants relating to the Group's 
                                                          borrowing facilities. It is calculated 
                                                          as the Group's adjusted operating 
                                                          profit and share of results in associates 
                                                          before depreciation and amortisation 
                                                          of licences and software, including 
                                                          those of our associates and IFRS 
                                                          16 adjustments, adjustment for the 
                                                          impact of fair value adjustment 
                                                          on contract liabilities on acquisition 
                                                          and adjustments for the timing of 
                                                          acquisitions and disposals. 
                            --------------------------  -------------------------------------------- 
 Adjusted profit             Profit before tax           Adjusted profit before tax measures 
  before tax(1)                                           the overall success of management 
                                                          actions to manage the portfolio 
                                                          and invest to grow the business. 
                                                          Adjusted profit before tax is one 
                                                          of the financial measures used for 
                                                          Directors' remuneration. 
                                                          This APM adjusts profit before tax 
                                                          for the amortisation of acquired 
                                                          intangible assets, exceptional items, 
                                                          net movements in deferred consideration 
                                                          and acquisition commitments and 
                                                          fair value remeasurements. 
                            --------------------------  -------------------------------------------- 
 Underlying profit           Profit before tax           Underlying profit before tax enables 
  before tax(1)                                           the Group to compare profit on a 
                                                          like-for-like basis. Underlying 
                                                          profit before tax adjusts for the 
                                                          impact of foreign exchange movements, 
                                                          M&A, new business launches, business 
                                                          closures, material events that move 
                                                          across reporting dates, material 
                                                          biennial events and the application 
                                                          of new accounting standards . 
                            --------------------------  -------------------------------------------- 
 Adjusted diluted            Diluted earnings            Adjusted diluted earnings per share 
  earnings per                per share                   measures the Group's overall returns 
  share(2)                                                to shareholders. It is calculated 
                                                          using profit for the year attributable 
                                                          to the equity holders of the parent 
                                                          adjusted for the amortisation of 
                                                          acquired intangible assets, exceptional 
                                                          items, net movements in deferred 
                                                          consideration and acquisition commitments 
                                                          and fair value remeasurements and 
                                                          tax thereon divided by the diluted 
                                                          weighted average number of shares 
                                                          in issue. 
                            --------------------------  -------------------------------------------- 
 Adjusted cash               Cash generated from         Adjusted cash generated from operations 
  generated from              operations                  gives a clearer picture of the cash 
  operations(1)                                           generating nature of the Group. 
                                                          It is calculated by adjusting cash 
                                                          generated from operations for the 
                                                          cash impact relating to exceptional 
                                                          items, capital expenditure and significant 
                                                          timing differences affecting the 
                                                          movement on working capital. 
                            --------------------------  -------------------------------------------- 
 Free cash flow              Cash generated from         Free cash flow reflects the cash 
                              operations                  available to shareholders. Cash 
                                                          generated from operations is adjusted 
                                                          for the cash impact of lease and 
                                                          interest payments, capital expenditure 
                                                          and taxation. 
                            --------------------------  -------------------------------------------- 
 Net cash(1)                 Cash and cash equivalents   Net cash shows the availability 
                              less borrowings             of cash in the business. It comprises 
                              (not including lease        cash at bank and in short-term deposits 
                              liabilities)                less borrowings (not including lease 
                                                          liabilities). 
                            --------------------------  -------------------------------------------- 
 Adjusted net cash(1)        Cash and cash equivalents   Adjusted net cash adjusts net cash 
                              less borrowings             for average exchange rates. 
                            --------------------------  -------------------------------------------- 
 Adjusted cash               None                        Adjusted cash conversion is a measure 
  conversion(1)                                           of the quality of the Group's earnings. 
                                                          It measures the percentage by which 
                                                          adjusted cash generated from operations, 
                                                          net of capital expenditure and cash 
                                                          payments for exceptional items, 
                                                          covers adjusted operating profit. 
                            --------------------------  -------------------------------------------- 
 Adjusted net cash           None                        Adjusted net cash to EBITDA ratio 
  to EBITDA ratio                                         is a measure used in covenants relating 
  for covenant purposes(1)                                to the Group's borrowing facilities. 
                                                          It is calculated as adjusted net 
                                                          cash as a percentage of adjusted 
                                                          EBITDA for covenant purposes. 
                            --------------------------  -------------------------------------------- 
 
 
 1   Reconciliation of these performance measures to statutory performance 
      measures can be found on below. 
 2   Calculation of adjusted diluted earnings per share is in note 8 to 
      the Condensed Consolidated Interim Financial Statements. 
 3   Operating profit is presented in the Consolidated Income Statement. 
      It is not defined per IFRS, however, it is a generally accepted profit 
      measure. 
 

Reconciliation of Condensed Consolidated Income Statement to adjusted results for the six months ended 31 March 2022

The Directors believe that the adjusted measures provide additional useful information for shareholders to evaluate and compare the performance of the business from period to period. These measures are used by management for budgeting, planning and monthly reporting purposes and are the basis on which executive management is incentivised. The non-IFRS measures also enable the Group to track more easily and consistently the underlying operational performance by separating out the following types of exceptional income, charges and non-cash items.

Adjusted figures are presented before the impact of amortisation of acquired intangible assets (comprising trademarks and brands, databases and customer relationships); exceptional items; share of associates' and joint ventures' acquired intangibles amortisation and exceptional items; net movements in deferred consideration and acquisition commitments; fair value remeasurements; related tax items and other adjusting items described below.

The amortisation of acquired intangible assets is adjusted as the premium paid relative to the net assets on the balance sheet of the acquired business is classified as either goodwill or as an intangible asset arising on a business combination and is recognised on the Group's balance sheet. This differs to organically developed businesses where assets such as employee talent and customer relationships are not recognised on the balance sheet. Impairment and amortisation of intangible assets and goodwill arising on acquisitions are excluded from adjusted results as they are balance sheet items that relate to historical M&A activity.

Exceptional items are items of income or expense considered by the Directors as being significant, non-recurring and not attributable to underlying trading. It is Group policy to treat, as exceptional, significant earn-out payments required by IFRS to be recognised as a compensation cost. IFRS requires that earn-out payments to selling shareholders retained in the acquired business for a contractual time period are treated as a compensation cost. Given that these payments are part of the cost of an investment and will not recur once the earn-out payments have been made, they have been excluded from adjusted profit. The accounting policy for exceptional items can be found in note 1 to the Group's 2021 Annual Report.

Adjusted finance costs exclude interest arising on any uncertain tax provisions, as these provisions are not in the ordinary course of business and relate to tax adjusting items.

In respect of earnings, adjusted amounts reflect a tax rate that includes the current tax effect of goodwill and intangible assets. Many of the Group's acquisitions, particularly in the US, give rise to significant tax savings as the amortisation of goodwill and intangible assets on acquisition is deductible for tax purposes. The Group considers that the resulting adjusted effective tax rate is therefore more representative of its tax payable position. Tax on exceptional items is excluded as these items are adjusted in accordance with Group policy. Adjustments in respect of prior years are also removed from the adjusted tax expense as they do not relate to current year underlying trading.

Further analysis of the adjusting items is presented in notes 2, 4, 5, 6 and 10 to the Condensed Consolidated Interim Financial Statements.

The Group has applied these principles in calculating adjusted measures and it is the Group's intention to continue to apply these principles in the future.

The reconciliation below sets out the adjusted results of the Group and the related adjustments to the Condensed Consolidated Income Statement that the Directors consider necessary to provide useful and comparable information about the Group's adjusted trading performance.

 
                                                    Unaudited six months                  Restated unaudited 
                                                            ended                          six months ended 
                                                       31 March 2022                        31 March 2021 
 
                                             Statutory   Adjustments   Adjusted   Statutory   Adjustments   Adjusted 
                                     Notes        GBPm          GBPm       GBPm        GBPm          GBPm       GBPm 
 
 Revenue                                 2       184.6             -      184.6       155.5             -      155.5 
 
 Adjusted operating profit               2        40.2             -       40.2        34.8             -       34.8 
 Acquired intangible amortisation       11      (10.4)          10.4          -       (9.4)           9.4          - 
 Exceptional items                       4      (20.3)          20.3          -       (8.0)           8.0          - 
 
 Operating profit                                  9.5          30.7       40.2        17.4          17.4       34.8 
 Operating profit margin                            5%             -        22%         11%             -        22% 
 
 Share of results in associates         10           -           0.2        0.2       (0.1)           0.2        0.1 
 
 Finance expense                         5       (1.9)           0.1      (1.8)       (1.9)           0.2      (1.7) 
 
 Profit before tax                                 7.6          31.0       38.6        15.4          17.8       33.2 
 Tax expense on profit                   6       (3.0)         (6.9)      (9.9)       (8.8)           2.3      (6.5) 
                                                        ------------                         ------------  --------- 
 Profit for the period                             4.6          24.1       28.7         6.6          20.1       26.7 
                                            ----------  ------------  ---------  ----------  ------------  --------- 
 
 Diluted earnings per 
  share                                  8        4.2p                    26.6p        6.1p                    24.6p 
                                            ----------  ------------  ---------  ----------  ------------  --------- 
 

The results for the six months to 31 March 2021 have been restated for IAS 38 IFRIC adjustments as detailed in note 1.

 
                                                     Audited year ended 30 Sept 2021 
 
                                             Statutory               Adjustments   Adjusted 
                                     Notes        GBPm                      GBPm       GBPm 
 
 Revenue                                         336.1                         -      336.1 
 
 Adjusted operating profit                        65.3                         -       65.3 
 Acquired intangible amortisation       11      (19.1)                      19.1          - 
 Exceptional items                       4      (15.1)                      15.1          - 
 
 Operating profit                                 31.1                      34.2       65.3 
 Operating profit margin                            9%                         -        19% 
 
 Share of results in associates         10           -                       0.3        0.3 
 
 Finance expense                         5       (4.5)                       0.3      (4.2) 
 
 Profit before tax                                26.6                      34.8       61.4 
 Tax expense on profit                   6      (14.0)                       1.8     (12.2) 
                                                        ------------------------  --------- 
 Profit for the year                              12.6                      36.6       49.2 
                                            ----------  ------------------------  --------- 
 
 Diluted earnings per share              8       11.7p                                45.5p 
                                            ----------  ------------------------  --------- 
 

Underlying measures

When assessing the performance of our businesses, the Board considers the adjusted results. The year-on-year change in adjusted results may not, however, be a fair like-for-like comparison as there are a number of factors which can influence growth rates but which do not reflect underlying performance.

Underlying results include adjusted results and are stated:

 
      --   at constant exchange rates, with the prior year comparatives being 
            restated using current year exchange rates; 
      --   including pro forma prior year comparatives for acquisitions and 
            new business launches and excluding all results for disposals or 
            business closures; 
      --   including adjustments for events which run in one of the current 
            or comparative periods due to changes in the event date. For example, 
            this means we adjust for biennial events; and 
      --   including proforma prior year adjustments for the application of 
            new accounting standards. 
 

The Group's adjusted and underlying measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with IFRS. The adjusted and underlying measures used by the Group are not necessarily comparable with those used by other companies.

The following table sets out the reconciliation from statutory to underlying for revenue, operating profit and profit before tax:

 
                                      Unaudited     Unaudited 
                                     six months    six months 
                                          ended         ended 
                                       31 March      31 March 
                                           2022          2021 
                                          Total         Total   Change % 
                                           GBPm          GBPm 
 
 Statutory revenue                        184.6         155.5        19% 
   Net M&A and closed businesses              -           6.7 
   Timing differences                         -           0.6 
   Foreign exchange                           -         (1.3) 
 Underlying revenue                       184.6         161.5        14% 
                                   ------------  ------------  --------- 
 
 Statutory operating profit                 9.5          17.4      (45%) 
   Adjustments(1)                          30.7          17.4 
 Adjusted operating profit                 40.2          34.8        16% 
   Net M&A and closed businesses              -           0.4 
   Timing differences                         -           0.5 
   Foreign exchange                           -         (0.8) 
 Underlying operating profit               40.2          34.9        15% 
                                   ------------  ------------  --------- 
 
 Statutory profit before tax                7.6          15.4      (51%) 
   Adjustments(1)                          31.0          17.8 
 Adjusted profit before tax                38.6          33.2        16% 
   Net M&A and closed businesses              -           0.4 
   Timing differences                         -           0.5 
   Foreign exchange                           -         (0.8) 
 Underlying profit before tax              38.6          33.3        16% 
                                   ------------  ------------  --------- 
 

(1) Adjustments methodology detailed on page 12.

The following tables reconcile the underlying revenue and adjusted operating profit changes for the divisions and the Group:

 
                                                                          Foreign exchange 
                                                             Asset                   gains 
                                 Fastmarkets     FPS    Management    on forward contracts   Total 
 2022                                   GBPm    GBPm          GBPm                    GBPm    GBPm 
 Statutory revenue                      48.5    79.8          55.2                     1.1   184.6 
 2021 
 Statutory revenue                      40.2    58.3          56.0                     1.0   155.5 
 Net M&A and closed businesses           0.7     6.0             -                       -     6.7 
 Timing differences                    (0.1)     0.7             -                       -     0.6 
 Foreign exchange                      (0.7)   (0.4)         (0.3)                     0.1   (1.3) 
                                ------------  ------  ------------  ----------------------  ------ 
 Underlying revenue                     40.1    64.6          55.7                     1.1   161.5 
 Underlying revenue change (%)           21%     23%          (1%)                       -     14% 
 
 
                                                                               Asset 
                                                   Fastmarkets     FPS    Management   Central Costs   Total 
 2022                                                     GBPm    GBPm          GBPm            GBPm    GBPm 
 Adjusted operating profit                                19.8    16.2          20.4          (16.2)    40.2 
 2021 
 Adjusted operating profit                                15.3     8.3          22.5          (11.3)    34.8 
 Net M&A and closed businesses                           (0.1)     0.5             -               -     0.4 
 Timing differences                                          -     0.5             -               -     0.5 
 Foreign exchange                                        (0.7)   (0.4)         (0.1)             0.4   (0.8) 
                                                  ------------  ------  ------------  --------------  ------ 
 Underlying adjusted operating profit                     14.5     8.9          22.4          (10.9)    34.9 
 Underlying adjusted operating profit change (%)           37%     80%          (9%)             49%     15% 
 

The following tables reconcile the underlying revenue changes for the divisions by revenue type:

 
                            Subscriptions                      Events                       Other                     Total 
                                     GBPm                        GBPm                        GBPm                      GBPm 
 Fastmarkets 
 2022 
 Statutory 
 revenue                             44.0                         3.0                         1.5                      48.5 
 
 2021 
 Statutory 
 revenue                             37.6                         1.3                         1.3                      40.2 
 Net M&A and 
 closed 
 businesses                           0.6                           -                         0.1                       0.7 
 Timing 
 differences                            -                       (0.1)                           -                     (0.1) 
 Foreign 
 exchange                           (0.7)                           -                           -                     (0.7) 
               --------------------------  --------------------------  --------------------------  ------------------------ 
 Underlying 
 revenue                             37.5                         1.2                         1.4                      40.1 
 Underlying 
 revenue 
 change (%)                           17%                        148%                          4%                       21% 
 
 Financial & 
 Professional 
 Services 
 (FPS) 
 2022 
 Statutory 
 revenue                             48.7                        24.8                         6.3                      79.8 
 
 2021 
 Statutory 
 revenue                             41.4                         9.1                         7.8                      58.3 
 Net M&A and 
 closed 
 businesses                           5.4                         0.3                         0.3                       6.0 
 Timing 
 differences                            -                         0.7                           -                       0.7 
 Foreign 
 exchange                           (0.4)                           -                           -                     (0.4) 
               --------------------------  --------------------------  --------------------------  ------------------------ 
 Underlying 
 revenue                             46.4                        10.1                         8.1                      64.6 
 Underlying 
 revenue 
 change (%)                            5%                        144%                       (22%)                       23% 
 
 
 
 Asset 
 Management 
 2022 
 Statutory 
 revenue                            34.1                        14.6                         6.5                        55.2 
 
 2021 
 Statutory 
 revenue                            33.9                        15.4                         6.7                        56.0 
 Net M&A and 
 closed 
 businesses                            -                           -                           -                           - 
 Timing 
 differences                           -                           -                           -                           - 
 Foreign 
 exchange                          (0.2)                           -                       (0.1)                       (0.3) 
              --------------------------  --------------------------  --------------------------  -------------------------- 
 Underlying 
 revenue                            33.7                        15.4                         6.6                        55.7 
 Underlying 
 revenue 
 change (%)                           1%                        (5%)                          0%                        (1%) 
 

Cash conversion

Cash conversion is an alternative performance measure of the quality of the Group's earnings. Cash conversion measures the percentage by which cash generated from operations covers adjusted operating profit.

 
                                                  Unaudited   Restated(1) unaudited    Audited 
                                                 six months              six months       year 
                                                      ended                   ended      ended 
                                                   31 March                31 March    30 Sept 
                                                       2022                    2021       2021 
                                                       GBPm                    GBPm       GBPm 
 
 Adjusted operating profit                             40.2                    34.8       65.3 
 
 Cash generated from operations                        29.7                    39.5       67.3 
 Exceptional items                                      1.7                     9.1       17.6 
 Capital expenditure                                  (2.2)                   (2.9)      (4.8) 
 Adjusted cash generated from operations               29.2                    45.7       80.1 
                                               ------------  ----------------------  --------- 
 
 Adjusted 12-month rolling cash conversion %            90%                    142%       123% 
 

(1) The results for the 12 months to 31 March 2021 have been restated for IAS 38 IFRIC adjustments as detailed in note 1.

Adjusted cash generated from operations is after adjusting for the cash impact relating to exceptional items and capital expenditure. For the period ended 31 March 2022, exceptional cash payments largely consist of integration and transaction costs of newly acquired businesses. For the period ended 31 March 2021 and year ended 30 September 2021, exceptional cash payments largely consist of integration and transaction costs of newly acquired businesses and to support the restructure and cost reduction programme announced in September 2020. At the half year, an adjusted 12-month cash conversion percentage is used to eliminate any seasonality.

Net cash is an alternative performance measure and comprises cash and cash equivalents along with the Group's borrowings excluding lease liabilities. The measure is important because the Group's RCF covenant includes the requirement to keep adjusted net debt below three times adjusted EBITDA. The following table sets out the cash movements in the year and reconciliation to adjusted net cash:

Net cash

 
                                                                    Unaudited               Unaudited    Audited 
                                                                   six months              six months       year 
                                                                        ended                   ended      ended 
                                                                     31 March                31 March    30 Sept 
                                                                         2022                    2021       2021 
                                                                         GBPm                    GBPm       GBPm 
 
 Net cash at beginning of period                                         32.5                    28.1       28.1 
 Net (decrease)/increase in cash and cash equivalents                  (20.5)                    47.6        4.2 
 Decrease/(increase) in borrowings                                        0.1                  (50.0)          - 
 Effect of foreign exchange rate movements                                0.4                   (0.9)        0.2 
 Net cash at end of period                                               12.5                    24.8       32.5 
                                                                -------------  ----------------------  --------- 
 
 Net cash comprises: 
 Cash at bank and short-term deposits                                    12.5                    74.8       32.5 
 Borrowings                                                                 -                  (50.0)          - 
                                                                -------------  ----------------------  --------- 
 Total cash and cash equivalents net of borrowings                       12.5                    24.8       32.5 
                                                                -------------  ----------------------  --------- 
 Net cash                                                                12.5                    24.8       32.5 
 Average exchange rate adjustment                                       (0.3)                     1.2      (0.1) 
 Adjusted net cash                                                       12.2                    26.0       32.4 
                                                                -------------  ----------------------  --------- 
 
   Adjusted EBITDA is an alternative performance measure. The following table sets out the reconciliation 
   from 12-month rolling adjusted operating profit to 12-month rolling adjusted EBITDA: 
                                                                     12-month    Restated(1) 12-month   12-month 
                                                                      rolling                 rolling    rolling 
                                                                     31 March                31 March    30 Sept 
                                                                         2022                    2021       2021 
                                                                         GBPm                    GBPm       GBPm 
 
 Adjusted operating profit                                               70.7                    53.6       65.3 
 Share of results in associates                                           0.5                       -        0.4 
 Add back:                                                                                                     - 
   Intangible amortisation of licences and software                       3.2                     2.5        2.9 
   Depreciation of property, plant and equipment                          1.6                     2.6        2.0 
   Depreciation of right of use assets                                    6.4                     6.9        6.7 
                                                                -------------  ----------------------  --------- 
 Adjusted EBITDA                                                         82.4                    65.6       77.3 
                                                                -------------  ----------------------  --------- 
 Add back: 
   IFRS 16 adjustments                                                  (9.7)                   (8.3)      (9.8) 
   Impact of fair value adjustment on contract liabilities                0.2                       -          - 
   M&A annualised adjustment                                              0.6                     1.1        0.4 
 Adjusted EBITDA for covenant purposes                                   73.5                    58.4       67.9 
                                                                -------------  ----------------------  --------- 
 Adjusted net cash to EBITDA ratio for covenant purposes                 0.17                    0.44       0.48 
 

(1) The results for the 12 months to 31 March 2021 have been restated for IAS 38 IFRIC adjustments as detailed in note 1.

The Group's borrowing facilities contain certain covenants, including the ratio of adjusted net debt to EBITDA. The inputs used in the covenant calculations, including the foreign exchange rates, are subject to adjustments as defined under the terms of the arrangement. The facility's covenants required the Group's net debt to be no more than three times adjusted EBITDA and required minimum levels of interest cover of three times on a rolling 12-month basis.

The bank covenant ratio uses an average exchange rate in the calculation of net debt and an annualised adjustment attributable to acquisitions and disposals in the calculation of adjusted EBITDA. When businesses are acquired after the beginning of the financial year, the calculation of adjusted EBITDA includes EBITDA attributable to the business as if the acquisition had been completed on the first day of the financial year. The calculation excludes the EBITDA of any businesses disposed of during the year.

The bank covenant ratio is adjusted to remove the impact of IFRS 16. This means that the adjusted EBITDA for covenant compliance calculations includes an entry for the rental expense which would have been recognised for the Group's leases had the transition to IFRS 16 not taken place. To be consistent with the bank covenant calculations, net cash is defined to exclude lease liabilities.

Principal risks and uncertainties

An overall increasing risk trend

The principal risks and uncertainties that affect the Group are described in detail on pages 51 to 60 of the 2021 Annual Report available at www.euromoneyplc.com. They are:

 
      1.    Slow post-covid economic recovery or poor business economic conditions 
             in major markets hinder the recovery of in-person events, and organic 
             revenue growth. 
      2.    Compliance and Controls: failure to comply with Group policies 
             and processes, complex global regulations and a litigious environment 
             causes reputational, legal or financial damage. 
      3.    Inability to execute M&A strategy or integrate acquisitions successfully 
             into the Group on a timely basis prevents the delivery of the strategy. 
      4.    Geopolitical upheaval has a major impact on the business environment. 
      5.    Cybersecurity and information security threats compromise data 
             integrity or result in a loss of key data. 
      6.    Inadequate ability of the business to manage talent churn effectively 
             results in the loss of key personnel in critical roles. 
      7.    Uncertain tax liabilities leads to material cash outflows. 
      8.    Existing and emerging competitor activity creates product and pricing 
             pressures, as well as potentially eroding margins. 
      9.    Exposure to USD exchange rate leads to unexpected swings in reported 
             results. 
      10.   Changing customer needs, new technology or changing governmental 
             priorities cause structural changes in markets reducing the value 
             delivered by our products and services. 
 

Although we still consider these to be the most relevant risks and uncertainties, the Board's view is that due to the global impacts of the war in Ukraine, the overall risk trend for the Group is increasing, both prior to and post-mitigation.

The war does not in itself create a stand-alone risk for the Group, but it does have an impact on some of the Group's existing principal risks, which has therefore resulted in three of the Group's risks moving on the risk matrix.

Risk 1 (Economic Recovery)

The Ukraine crisis and resulting sanctions are likely to slow the post-covid economic recovery. In particular, current and potential restrictions on Russian oil and gas imports have exacerbated the existing macroeconomic inflation risks, potentially increased the future costs of borrowing if interest rates rise significantly, and made travel more costly, which could impact travel to events. The result is a heightened risk of a global recession being endured over the next 18 months. The Group also decided in March 2022 to cease all business with Russia and Belarus for the time being, which will have a revenue and profit impact for the foreseeable future. This decision was taken to ensure the Group is compliant with very fast-moving sanctions requirements and is consistent with the actions that many other multinationals have taken.

Risk 4 (Geopolitical Risk)

The war in Ukraine has resulted in a large and co-ordinated global response, which in turn has influenced and changed various regional and international relationships, resulting in more geopolitical instability. In addition, there are numerous other potential geopolitical flash points around the world which are unrelated to the Russia-Ukraine war, but could escalate to cause further disruption to business and the wider economy.

Risk 5 (Cybersecurity)

Russia has targeted international companies and governments in Cyber-attacks in the past and it is understood that Russia has deployed such attacks again, specifically against countries and companies in countries that have strongly supported Ukraine, which would be most of the EU, the UK and the USA. These may take a number of forms including denial of service or ransomware attacks.

The Board continues to prioritise the management of risk

The Board is focused on taking the steps necessary to ensure the Group manages risk effectively, which includes a regular and robust assessment and management of the Group's risks.

It is likely that the increasing risk trend as a result of heightened geopolitical uncertainty could impact the Group's performance over the remaining six months of the financial year and dilute the benefits of the rolling back of covid-related restrictions around the globe.

An updated version of the Group's Risk matrix as found on page 50 of the 2021 Annual Report is set out in the below link to reflect the above changes in risk trends.

http://www.rns-pdf.londonstockexchange.com/rns/0243M_1-2022-5-18.pdf

Condensed Consolidated Income Statement

for the six months ended 31 March 2022

 
                                                                         Restated 
                                                          Unaudited     unaudited    Audited 
                                                         six months    six months       year 
                                                              ended         ended      ended 
                                                           31 March      31 March    30 Sept 
                                                               2022          2021       2021 
                                                Notes          GBPm          GBPm       GBPm 
 
 Revenue                                            2         184.6         155.5      336.1 
 Cost of Sales                                               (26.5)        (20.2)     (45.5) 
 Gross Profit                                                 158.1         135.3      290.6 
 
 Administrative expenses and distribution 
  costs                                                     (117.9)        (99.0)    (220.4) 
 Net impairment of trade receivables                              -         (1.5)      (4.9) 
 Operating profit before acquired intangible 
  amortisation and exceptional items                2          40.2          34.8       65.3 
 
 Acquired intangible amortisation                  11        (10.4)         (9.4)     (19.1) 
 Exceptional items                                  4        (20.3)         (8.0)     (15.1) 
 
 Operating profit                                   2           9.5          17.4       31.1 
 
 Share of results in associates                    10             -         (0.1)          - 
 
 Finance expense                                    5         (1.9)         (1.9)      (4.5) 
 
 Profit before tax                                  2           7.6          15.4       26.6 
 Tax expense on profit                              6         (3.0)         (8.8)     (14.0) 
 Profit for the period                              2           4.6           6.6       12.6 
                                                       ------------  ------------  --------- 
 
 Earnings per share 
   Basic                                            8          4.2p          6.1p      11.7p 
   Diluted                                          8          4.2p          6.1p      11.7p 
 
 Dividend per share (including proposed 
  dividends)                                        7          6.1p          5.7p      18.2p 
 

A detailed reconciliation of the Group's statutory results to the adjusted results is set out in the glossary to the Half Year Report on pages 12 to 20.

The 31 March 2021 Condensed Consolidated Income Statement has been restated for IAS 38 IFRIC adjustments as detailed in note 1.

Condensed Consolidated Statement of Comprehensive Income

for the six months ended 31 March 2022

 
                                                                             Unaudited   Restated unaudited    Audited 
                                                                            six months           six months       year 
                                                                                 ended                ended      ended 
                                                                              31 March             31 March    30 Sept 
                                                                                  2022                 2021       2021 
                                                                                  GBPm                 GBPm       GBPm 
 
 Profit for the period                                                             4.6                  6.6       12.6 
                                                                          ------------  -------------------  --------- 
 
 Items that may be reclassified subsequently to profit or loss: 
 Change in fair value of cash flow hedges                                        (0.7)                  4.5        3.3 
 Transfer of gains on cash flow hedges from fair value reserves to 
 Income Statement:                                                                                        -          - 
   Foreign exchange gains in revenue                                             (1.1)                (1.0)      (2.4) 
   Foreign exchange gains in administrative expenses                             (0.2)                (0.1)      (0.4) 
 Net exchange differences on translation of net investments in overseas 
  subsidiary undertakings                                                         10.1               (26.9)     (17.2) 
 Translation reserves recycled to Income Statement                                   -                  1.2        1.2 
 Tax gains on changes in fair value cash flow hedges                               0.3                    -        0.3 
 
 Items that will not be reclassified to profit or loss: 
 Actuarial gains on defined benefit pension schemes                                7.1                  2.1        4.5 
 Tax loss on actuarial gains on defined benefit pension schemes                  (1.8)                (0.4)      (1.0) 
 Change in value of FVTOCI assets                                                    -                    -        0.1 
 Other comprehensive income/(expense) for the period                              13.7               (20.6)     (11.6) 
                                                                          ------------  -------------------  --------- 
 
 Total comprehensive income/(expense) for the period                              18.3               (14.0)        1.0 
                                                                          ------------  -------------------  --------- 
 

The 31 March 2021 Condensed Consolidated Statement of Comprehensive Income has been restated for IAS 38 IFRIC adjustments as detailed in note 1.

Condensed Consolidated Statement of Financial Position

as at 31 March 2022

 
                                                  Unaudited    Audited 
                                                      as at      as at 
                                                   31 March    30 Sept 
                                                       2022       2021 
                                          Notes        GBPm       GBPm 
 Non-current assets 
 Intangible assets 
  Goodwill                                   11       472.4      457.1 
  Other intangible assets                    11       194.8      188.2 
 Property, plant and equipment                          7.2       11.4 
 Right of use assets                         12        26.5       44.2 
 Investment in associates                    10         8.8        8.9 
 Other equity investments                    10         0.2        0.2 
 Deferred tax assets                                    4.0        4.3 
 Retirement benefit asset                              10.7        3.0 
 Other non-current assets                               0.8        0.8 
 Derivative financial instruments                       0.1          - 
                                                      725.5      718.1 
                                                 ----------  --------- 
 Current assets 
 Trade and other receivables                          108.1       84.3 
 Contract assets                                        4.1        5.4 
 Current income tax assets                              5.6        4.0 
 Cash and cash equivalents                             12.5       32.5 
 Derivative financial instruments                       0.4        1.9 
                                                      130.7      128.1 
                                                 ----------  --------- 
 Current liabilities 
 Acquisition commitments                              (0.1)      (0.1) 
 Deferred consideration                               (1.9)          - 
 Trade and other payables                            (37.9)     (43.1) 
 Lease liabilities                           13       (9.1)      (9.3) 
 Current income tax liabilities                      (11.9)     (13.3) 
 Accruals                                            (41.7)     (62.3) 
 Contract liabilities                               (164.3)    (132.6) 
 Derivative financial instruments                     (1.8)      (0.6) 
 Provisions                                           (1.1)      (1.6) 
                                                    (269.8)    (262.9) 
                                                 ----------  --------- 
 Net current liabilities                            (139.1)    (134.8) 
                                                 ----------  --------- 
 Total assets less current liabilities                586.4      583.3 
 
 Non-current liabilities 
 Lease liabilities                           13      (49.7)     (52.4) 
 Other non-current liabilities                            -      (0.2) 
 Contract liabilities                                 (0.5)      (2.2) 
 Deferred tax liabilities                            (32.2)     (30.1) 
 Derivative financial instruments                     (0.1)      (0.3) 
 Provisions                                           (3.2)      (3.0) 
                                                 ----------  --------- 
                                                     (85.7)     (88.2) 
 Net assets                                           500.7      495.1 
                                                 ----------  --------- 
 

Condensed Consolidated Statement of Financial Position continued

as at 31 March 2022

 
                                             Unaudited    Audited 
                                                 as at      as at 
                                              31 March    30 Sept 
                                                  2022       2021 
                                     Notes        GBPm       GBPm 
 Shareholders' equity 
 Called up share capital                16         0.3        0.3 
 Share premium account                           104.6      104.6 
 Other reserve                                    65.0       65.0 
 Capital redemption reserve                        0.1        0.1 
 Own shares                                     (14.1)     (14.1) 
 Reserve for share-based payments                 41.0       39.1 
 Fair value reserve                             (24.4)     (22.4) 
 Translation reserve                             116.0      105.9 
 Retained earnings                               212.2      216.6 
                                                        --------- 
 Total equity                                    500.7      495.1 
                                            ----------  --------- 
 

Condensed Consolidated Statement of Changes in Equity

for the six months ended 31 March 2022

 
                                                                       Reserve 
                                                                           for 
                       Called                       Capital             share- 
                           up     Share             redemp-              based      Fair    Trans- 
                        share   premium     Other      tion      Own      pay-     value    lation   Retained    Total 
                      capital   account   reserve   reserve   shares     ments   reserve   reserve   earnings   equity 
                         GBPm      GBPm      GBPm      GBPm     GBPm      GBPm      GBPm      GBPm       GBPm     GBPm 
 
 At 1 October 2020        0.3     104.6      65.0       0.1   (14.6)      38.7    (23.5)     122.4      218.1    511.1 
 Profit for the 
  year                      -         -         -         -        -         -         -         -       12.6     12.6 
 Other 
  comprehensive 
  income/(expense) 
  for the year              -         -         -         -        -         -       1.1    (16.5)        3.8   (11.6) 
                     --------  --------  --------  --------  -------  --------  --------  --------  ---------  ------- 
 Total 
  comprehensive 
  income/(expense) 
  for the year              -         -         -         -        -         -       1.1    (16.5)       16.4      1.0 
 Share-based 
  payments                  -         -         -         -        -       0.8         -         -          -      0.8 
 Cash dividend paid         -         -         -         -        -         -         -         -     (18.5)   (18.5) 
 Exercise of share 
  options                   -         -         -         -      0.5     (0.4)         -         -      (0.1)        - 
 VAT on share 
  buy-back                  -         -         -         -        -         -         -         -        0.6      0.6 
 Tax relating to 
  items taken 
  directly to 
  equity                    -         -         -         -        -         -         -         -        0.1      0.1 
                     --------  --------  --------  --------  -------  --------  --------  --------  ---------  ------- 
 At 30 September 
  2021                    0.3     104.6      65.0       0.1   (14.1)      39.1    (22.4)     105.9      216.6    495.1 
                     --------  --------  --------  --------  -------  --------  --------  --------  ---------  ------- 
 Profit for the 
  period                    -         -         -         -        -         -         -         -        4.6      4.6 
 Other 
  comprehensive 
  (expense)/income 
  for the period            -         -         -         -        -         -     (2.0)      10.1        5.6     13.7 
                     --------  --------  --------  --------  -------  --------  --------  --------  ---------  ------- 
 Total 
  comprehensive 
  (expense)/income 
  for the period            -         -         -         -        -         -     (2.0)      10.1       10.2     18.3 
 Share-based 
  payments                  -         -         -         -        -       1.9         -         -          -      1.9 
 Cash dividend paid         -         -         -         -        -         -         -         -     (13.5)   (13.5) 
 Tax relating to 
  items taken 
  directly to 
  equity                    -         -         -         -        -         -         -         -      (1.1)    (1.1) 
 At 31 March 2022         0.3     104.6      65.0       0.1   (14.1)      41.0    (24.4)     116.0      212.2    500.7 
                     --------  --------  --------  --------  -------  --------  --------  --------  ---------  ------- 
 

Condensed Consolidated Statement of Changes in Equity

for the six months ended 31 March 2021

 
                                                                       Reserve 
                      Called                       Capital                 for 
                          up     Share             redemp-              share-      Fair    Trans- 
                       share   premium     Other      tion      Own      based     value    lation   Retained    Total 
                     capital   account   reserve   reserve   shares   Payments   reserve   reserve   earnings   Equity 
                        GBPm      GBPm      GBPm      GBPm     GBPm       GBPm      GBPm      GBPm       GBPm     GBPm 
 
 At 1 October 2020       0.3     104.6      65.0       0.1   (14.6)       38.7    (23.5)     122.4      218.1    511.1 
 Profit for the 
  period 
  (restated)(1)            -         -         -         -        -          -         -         -        6.6      6.6 
 Other 
  comprehensive 
  income/(expense) 
  for the period           -         -         -         -        -          -       3.9    (26.2)        1.7   (20.6) 
                    --------  --------  --------  --------  -------  ---------  --------  --------  ---------  ------- 
 Total 
  comprehensive 
  income/(expense) 
  for the period           -         -         -         -        -          -       3.9    (26.2)        8.3   (14.0) 
 Share-based 
  payments                 -         -         -         -        -        0.2         -         -          -      0.2 
 Cash dividend 
  paid                     -         -         -         -        -          -         -         -     (12.3)   (12.3) 
 Exercise of share 
  options                  -         -         -         -      0.5      (0.4)         -         -      (0.1)        - 
 VAT on share 
  buyback                  -         -         -         -        -          -         -         -        0.6      0.6 
 Tax relating to 
  items taken 
  directly to 
  equity                   -         -         -         -        -          -         -         -        0.5      0.5 
 At 31 March 2021 
  (restated)(1)          0.3     104.6      65.0       0.1   (14.1)       38.5    (19.6)      96.2      215.1    486.1 
                    --------  --------  --------  --------  -------  ---------  --------  --------  ---------  ------- 
 

(1) Restated for IAS 38 IFRIC adjustments as detailed in the basis of preparation (note 1).

The other reserve represents the share premium arising on the shares issued for the purchase of Metal Bulletin plc in October 2006.

The investment in own shares is held by the Euromoney Employees' Share Ownership Trust and Euromoney Employee Share Trust.

The trusts waived the rights to receive dividends. Interest and administrative costs are charged to the profit and loss account of the trusts as incurred and included in the Condensed Consolidated Financial Statements.

 
                                                 Unaudited     Unaudited     Audited 
                                                six months    six months        year 
                                                     ended         ended       ended 
                                                  31 March      31 March     30 Sept 
                                                      2022          2021        2021 
 Number of shares held: 
 Euromoney Employees' Share Ownership Trust         58,976        58,976      58,976 
 Euromoney Employee Share Trust                  1,139,807     1,139,807   1,139,807 
 Total                                           1,198,783     1,198,783   1,198,783 
                                              ------------  ------------  ---------- 
 Nominal cost per share (p)                           0.25          0.25        0.25 
 Historical cost per share (GBP)                     11.76         11.76       11.76 
 Market value (GBPm)                                  11.8          11.4        12.2 
 

Condensed Consolidated Statement of Cash Flows

for the six months ended 31 March 2022

 
                                                                             Unaudited   Restated unaudited    Audited 
                                                                            six months           six months       year 
                                                                                 ended                ended      ended 
                                                                              31 March             31 March    30 Sept 
                                                                                  2022                 2021       2021 
                                                         Notes                    GBPm                 GBPm       GBPm 
 Cash flow from operating activities 
 Operating profit                                                                  9.5                 17.4       31.1 
 Long-term incentive expense                                                       1.9                  0.2        0.8 
 Acquired intangible amortisation                           11                    10.4                  9.4       19.0 
 Licences and software amortisation                                                1.6                  1.3        2.9 
 Depreciation and impairment of property, plant and 
  equipment                                                                        4.4                  1.2        2.8 
 Depreciation and impairment of right of use assets         12                    18.5                  3.3        9.0 
 Recycling of foreign exchange                               4                       -                  1.2        1.2 
 Decrease in provisions                                                          (0.3)                (3.9)      (5.5) 
                                                                ----------------------  -------------------  --------- 
 Operating cash flows before movements in working 
  capital                                                                         46.0                 30.1       61.3 
 (Increase)/decrease in receivables                                             (20.9)                  2.0     (16.6) 
 Increase in payables                                                              4.6                  7.4       22.6 
                                                                ----------------------  -------------------  --------- 
 Cash generated from operations                                                   29.7                 39.5       67.3 
 Income taxes paid                                                              (12.5)                (1.7)      (3.7) 
 Net cash generated from operating activities                                     17.2                 37.8       63.6 
                                                                ----------------------  -------------------  --------- 
 
 Investing activities 
 Purchase of intangible assets                                                   (2.0)                (2.7)      (4.6) 
 Purchase of property, plant and equipment                                       (0.2)                (0.2)      (0.2) 
 Proceeds from disposal of property, plant and 
  equipment                                                                          -                    -        0.1 
 Purchase of business/subsidiary undertaking, net of 
  cash acquired                                              9                  (16.6)               (20.2)     (24.2) 
 Purchase of long term investment                                                    -                    -      (0.1) 
 Net cash used in investing activities                                          (18.8)               (23.1)     (29.0) 
                                                                ----------------------  -------------------  --------- 
 
 Financing activities 
 Dividends paid                                              7                  (13.5)               (12.3)     (18.5) 
 Interest paid                                                                   (0.6)                (0.5)      (2.6) 
 Capital element of lease repayments                                             (3.9)                (3.9)      (8.0) 
 Interest element of lease repayments                                            (0.8)                (0.9)      (1.8) 
 Increase in borrowings                                     15                    19.9                 50.0       50.0 
 Repayment of borrowings                                                        (20.0)                    -     (50.0) 
 Recovery of VAT on share buy-back costs                                             -                  0.5        0.5 
 Net cash used in financing activities                                          (18.9)                 32.9     (30.4) 
                                                                ----------------------  -------------------  --------- 
 Net (decrease)/increase in cash and cash equivalents                           (20.5)                 47.6        4.2 
 Cash and cash equivalents at beginning of period                                 32.5                 28.1       28.1 
 Effect of foreign exchange rate movements                                         0.5                (0.9)        0.2 
                                                                ----------------------  -------------------  --------- 
 Cash and cash equivalents at end of period                                       12.5                 74.8       32.5 
                                                                ----------------------  -------------------  --------- 
 

The 31 March 2021 Condensed Consolidated Statement of Cash Flows has been restated as detailed in note 1.

Notes to the Condensed Consolidated Interim Financial Statements

1 Basis of preparation

Euromoney Institutional Investor PLC (the 'Company') is a company incorporated in the United Kingdom.

The Group financial statements consolidate those of the Company and its subsidiaries (together referred to as the 'Group') and equity-account the Group's interest in associates.

This Half Year Report was approved by the Board of Directors on 18 May 2022.

These condensed consolidated interim financial statements have been prepared in accordance with the disclosure and transparency rules of the Financial Conduct Authority and using accounting policies consistent with International Financial Reporting Standards (IFRS) as adopted by the UK Endorsement Board and in accordance with International Accounting Standard (IAS) 34 'Interim Financial Reporting'. The change in basis of preparation from IFRS adopted by the European Union to IFRS adopted by the UK Endorsement Board is required by UK company law for the purposes of financial reporting as a result of the UK's exit from the EU on 31 January 2020 and the cessation of the transition period on 31 December 2020. This change does not constitute a change in accounting policy, rather a change in framework which is required for the Group to use IFRS in company law. There is no impact on the recognition, measurement or disclosure between the two frameworks in the period reported.

The financial information for the year ended 30 September 2021 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006, the financial information was prepared in accordance with International Accounting Standards in conformity with the requirements of the Companies Act 2006 and IFRS adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the EU. There are no differences for the Group in applying each of these accounting frameworks. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditor's report on those accounts was not qualified, did not draw attention to any matters by way of emphasis and did not contain statements under section 498(2) or 498(3) of the Companies Act 2006.

The Group previously reported in thousands of pounds. It has now changed its disclosure, rounding to hundreds of thousands of pounds.

Accounting policies

The Condensed Consolidated Interim Financial Statements has been prepared under the historical cost convention, except for the revaluation of certain financial instruments.

The same accounting policies, presentation and methods of computation are followed in these condensed consolidated interim financial statements as were applied in the Group's latest annual audited financial statements.

Taxes on income in the half year are accrued using the tax rate that would be applicable to expected total annual profit or loss.

There were no material related party transactions recorded in the current or prior period. As such, there is no related parties disclosure in the notes to these Condensed Consolidated Interim Financial Statements.

Restatements

In March 2021, IFRIC issued an agenda decision on configuration and customisation costs in a cloud computing arrangement relating to IAS 38 'Intangible Assets'. In response to the IFRIC update the Group's accounting policy on intangibles assets have been updated, specifically to disallow the capitalisation of costs incurred in the implementation of 'software as a service' (SaaS) solutions. This change in accounting policy is applied retrospectively and the impact on the Group's financial statements for the period ended 31 March 2021 is summarised in the following table:

 
 
 Statements adjusted       Line item                             2021 reported   Restatement   2021 restated 
                                                                          GBPm          GBPm            GBPm 
------------------------                                                        ------------ 
                           Operating profit before 
 Condensed Consolidated     acquired intangible amortisation 
  Income Statement          and exceptional items(1)                      36.8         (2.0)            34.8 
------------------------  ------------------------------------  --------------  ------------  -------------- 
  Tax expense on profit                                                  (9.3)           0.5           (8.8) 
 -------------------------------------------------------------  --------------  ------------  -------------- 
  Basic EPS (total)                                                        7.6         (1.5)             6.1 
 -------------------------------------------------------------  --------------  ------------  -------------- 
  Diluted EPS (total)                                                      7.6         (1.5)             6.1 
 -------------------------------------------------------------  --------------  ------------  -------------- 
 Condensed Consolidated 
  Statement of             Retained earnings at 1 October 
  Changes in Equity         2020                                         224.4         (6.3)           218.1 
------------------------  ------------------------------------  --------------  ------------  -------------- 
 Condensed Consolidated 
  Statement of 
  Cash Flows               Operating profit                               19.4         (2.0)            17.4 
------------------------  ------------------------------------  --------------  ------------  -------------- 
  Licenses and software amortisation                                       2.1         (0.8)             1.3 
 -------------------------------------------------------------  --------------  ------------  -------------- 
  Purchase of intangible assets                                          (5.5)           2.8           (2.7) 
 -------------------------------------------------------------  --------------  ------------  -------------- 
 

(1) All of the adjustment relates to administrative expenses

Key judgemental areas adopted in preparing these Condensed Consolidated Financial Statements

The significant accounting judgements and estimates are consistent with that disclosed in the Group's 2021 Annual Report, except for the following:

Significant judgements

Following the successful introduction of flexible working across Euromoney, the Group has reviewed its real estate requirements and has identified significant opportunities to reduce office costs in London and New York to reflect the footprint that suits its needs. As a result, excess office space in New York will be vacated, through the potential agreement of an early exit and a portion of its London offices will be made available to sublet. This decision to separate the respective assets from those used in the ordinary course of business is a triggering event for impairment review. These assets are impaired as a standalone CGU. Further information is disclosed in note 12.

Critical estimates

In assessing the impairment required for the sublet space in London, the book values of the relevant assets were compared to the present value of the future cash flows associated with the space. This includes up-front fit-out costs and future running costs, which are expected to be relatively stable. The most uncertain variable used in the impairment model is the level of sublease income expected to be achieved, particularly affected by the term of the eventual sublease. These estimates on sublease income were provided by external industry experts, modelling a sublease term of three years expected after a 12-month fit-out and marketing void. The impairment review resulted in the respective assets being fully written down. For the impairment to be reversed, the sublease term would need to increase to four years and three months. The impairment model is not sensitive to changes in assumptions about the market rent which could be achieved.

Going concern, debt covenants and liquidity

At 31 March 2022, the Group's net cash position, excluding lease liabilities, was GBP12.5m comprising cash and cash equivalents, and there were no amounts borrowed through the Group's revolving credit facility. At 31 March 2022 the Group had access to a committed GBP190m multi-currency revolving credit facility, available until May 2024, which was extended by a further year, until May 2025, in April 2022. The facility's covenant requires the Group's net debt to be no more than three times 12-month adjusted EBITDA, though this can increase to three and a half times for certain periods in the event of an acquisition and requires minimum levels of interest cover of three times adjusted EBITDA on a 12-month basis. The values and foreign exchange rates used in the covenant calculations are subject to adjustments from the statutory numbers as defined under the terms of the facility agreement.

The Group has seen a recovery in its events cash flows following the easing of restrictions in key territories. However, in making their going concern assessment, the Directors have considered potential future restrictions or a slower return of events due to aversion to travel, whether due to covid-19 or other factors such as climate change. The Group does not have operations in Russia or material customers based in Russia or Ukraine. However, in making the assessment, the Directors have considered the higher inflationary environment and modelled a scenario of further inflation that it is unable to pass onto its customers. The Group has not identified any material uncertainties in its going concern assessment.

Taking into account reasonably possible changes in trading performance, the Group's forecasts and projections, out to the going concern assessment period of at least 12 months from the date of signing this Half Year Report, show that the Group will be able to operate within the level and covenants of its current and available borrowing facilities.

In making the going concern assessment, the Directors have also modelled a severe but plausible downside that assumes a 70% reduction in physical events for the remainder of the financial year ending 30 September 2022, and a 70% reduction of events revenue for the financial years 2023 and 2024 with a 20% profit mitigation in the latter years, all uncertain tax cases are paid in full, a further 5% inflation is applied to overheads and staff costs (over and above the cost inflation already included in the forecasts) and a fall of 5% in non-events revenue compared to the current plan. Under this scenario, the Group maintains sufficient liquidity and is projected to satisfy covenants required by the revolving credit facility after taking measures to preserve cash.

Based on the Group's cash flow forecasts and projections, the Board is satisfied that the Group will be able to operate for a period extending to at least 12 months from the date of signing of this Half Year Report, including the impact of any potential transactions that are planned or expected to complete within this period. For this reason, the Group continues to adopt the going concern basis in preparing its financial statements.

2 Segmental analysis

The analysis by segment is presented in accordance with IFRS 8 'Operating Segments', on the basis of those segments whose operating results are regularly reviewed by the Chief Executive, who acts as the Chief Operating Decision Maker (CODM) as defined by IFRS 8.

Segmental information is presented in respect of the Group's divisions and reflects the Group's management and internal reporting structure. The Group is organised into three divisions: Fastmarkets; Financial & Professional Services (FPS); and Asset Management.

Revenues generated in the Fastmarkets division are primarily from subscriptions. FPS and Asset Management revenues consist mainly of subscriptions and events. A breakdown of the Group's revenue by type is set out below. Advertising revenue is included in other revenue.

Analysis of the Group's three main geographical areas is also set out to provide additional information on the trading performance of the businesses.

Inter-segment sales are charged at prevailing market rates and shown in the eliminations columns.

 
                                                Subscriptions   Events   Other   Total revenue 
 2022                                                    GBPm     GBPm    GBPm            GBPm 
 Revenue 
 by division and type: 
 Fastmarkets                                             44.0      3.0     1.5            48.5 
 Financial & Professional Services                       48.7     24.8     6.3            79.8 
 Asset Management                                        34.1     14.6     6.5            55.2 
                                                        126.8     42.4    14.3           183.5 
 Foreign exchange gains on forward contracts                -        -     1.1             1.1 
                                               --------------  -------  ------  -------------- 
 Revenue                                                126.8     42.4    15.4           184.6 
                                               --------------  -------  ------  -------------- 
 

Events revenue of GBP30.1m (2021: GBP13.0m) and print advertising of GBP0.8m (2021: GBP2.5m) are recognised at a point in time. The remaining subscription, events-based memberships and online advertising revenue is recognised over time.

 
                                                  Subscriptions    Events    Other   Total revenue 
 2021                                                      GBPm      GBPm     GBPm            GBPm 
 Revenue 
 by division and type: 
 Fastmarkets                                               37.6       1.3      1.3            40.2 
 Financial & Professional Services                         41.4       9.1      7.8            58.3 
 Asset Management                                          33.9      15.4      6.7            56.0 
                                                          112.9      25.8     15.8           154.5 
 Foreign exchange losses on forward contracts                 -         -      1.0             1.0 
                                                ---------------  --------  -------  -------------- 
 Revenue                                                  112.9      25.8     16.8           155.5 
                                                ---------------  --------  -------  -------------- 
 

2 Segmental analysis continued

 
                                                 Unaudited six months ended 31 March 
                        United Kingdom     North America     Rest of World     Eliminations         Total 
                          2022     2021      2022    2021     2022     2021     2022    2021    2022    2021 
                          GBPm     GBPm      GBPm    GBPm     GBPm     GBPm     GBPm    GBPm    GBPm    GBPm 
 Revenue 
 by division and 
 source: 
 Fastmarkets              26.5     17.9      21.1    21.6      0.9      0.8        -   (0.1)    48.5    40.2 
 Financial & 
  Professional 
  Services                47.9     39.9      32.3    18.4      2.7      3.8    (3.1)   (3.8)    79.8    58.3 
 Asset Management            -        -      55.3    56.0        -        -    (0.1)       -    55.2    56.0 
 Foreign exchange 
  gains 
  on forward 
  contracts                1.1      1.0         -       -        -        -        -       -     1.1     1.0 
                      --------  -------  --------  ------  -------  -------  -------  ------  ------  ------ 
 Revenue                  75.5     58.8     108.7    96.0      3.6      4.6    (3.2)   (3.9)   184.6   155.5 
                      --------  -------  --------  ------  -------  -------  -------  ------  ------  ------ 
 Revenue by 
  destination             32.4     24.3      97.2    83.8     55.0     47.4        -       -   184.6   155.5 
                      --------  -------  --------  ------  -------  -------  -------  ------  ------  ------ 
 
 
 
                                                               Unaudited six months ended 31 March 
                   United Kingdom                   North America                  Rest of World                        Total 
                           Restated                                    Restated           Restated                                      Restated 
                    2022       2021                  2022                  2021    2022       2021                    2022                  2021 
                    GBPm       GBPm                  GBPm                  GBPm    GBPm       GBPm                    GBPm                  GBPm 
 Operating 
 profit(1) 
 by division 
 and source: 
 Fastmarkets        13.1        7.1                   9.9                  11.4   (3.2)      (3.2)                    19.8                  15.3 
 Financial & 
  Professional 
  Services           5.1        5.5                  13.1                   5.3   (2.0)      (2.5)                    16.2                   8.3 
 Asset 
  Management           -          -                  20.4                  22.6       -      (0.1)                    20.4                  22.5 
 Unallocated 
  corporate 
  costs           (16.0)     (10.8)                     -                 (0.1)   (0.2)      (0.4)                  (16.2)                (11.3) 
                 -------  ---------  --------------------  --------------------  ------  ---------  ----------------------  -------------------- 
 Operating 
  profit/(loss) 
  before 
  acquired 
  intangible 
  amortisation 
  and 
  exceptional 
  items(1)           2.2        1.8                  43.4                  39.2   (5.4)      (6.2)                    40.2                  34.8 
                 -------  ---------  --------------------  --------------------  ------  ---------  ----------------------  -------------------- 
 Acquired 
  intangible 
  amortisation 
  (note 
  11)(2)           (2.0)      (2.1)                 (8.4)                 (7.3)       -          -                  (10.4)                 (9.4) 
 Exceptional 
  items (note 
  4)              (12.7)      (4.2)                 (7.6)                 (3.8)       -          -                  (20.3)                 (8.0) 
                                                                                                    ----------------------  -------------------- 
 Operating 
  (loss)/ 
  profit          (12.5)      (4.5)                  27.4                  28.1   (5.4)      (6.2)                     9.5                  17.4 
                 -------  ---------  --------------------  --------------------  ------  ---------  ----------------------  -------------------- 
 Share of results in 
  associates 
  (note 10)                                                                                                              -                 (0.1) 
 Finance 
  expense (note 
  5)                                                                                                                 (1.9)                 (1.9) 
                                                                                                    ----------------------  -------------------- 
 Profit before 
  tax                                                                                                                  7.6                  15.4 
 Tax expense on 
  profit 
  (note 6)                                                                                                           (3.0)                 (8.8) 
                                                                                                    ----------------------  -------------------- 
 Profit for the period                                                                                                 4.6                   6.6 
                                                                                                    ----------------------  -------------------- 
 

(1) Restated for IAS 38 IFRIC adjustments as detailed in the basis of preparation (note 1). The restatement increased Fastmarkets operating profits by GBP0.1m in the UK. Financial & Professional Services operating profits were reduced by GBP1.3m in the UK. Asset Management operating profits were reduced by GBP0.2m in North America. Unallocated corporate costs were increased by GBP0.6m in the UK.

(2) Acquired intangible amortisation represents amortisation of acquisition-related non-goodwill assets such as trademarks and brands, customer relationships, databases and software (note 11).

2 Segmental analysis continued

 
                                                    Unaudited six months ended 31 March 
                                                                                   Depreciation, 
                                       Acquired intangible     Exceptional          impairments 
                                          amortisation            items         and amortisation(1) 
                                            2022       2021     2022    2021     2022   Restated 2021 
                                            GBPm       GBPm     GBPm    GBPm     GBPm            GBPm 
 Other segmental information 
 by division: 
 Fastmarkets                               (3.1)      (3.3)    (0.3)   (1.3)    (0.7)           (1.1) 
 Financial & Professional Services         (5.3)      (3.8)    (0.9)   (3.2)    (0.8)           (1.0) 
 Asset Management                          (2.0)      (2.3)        -   (0.5)    (0.4)             0.6 
 Unallocated corporate costs                   -          -   (19.1)   (3.0)   (22.6)           (4.3) 
 Total                                    (10.4)      (9.4)   (20.3)   (8.0)   (24.5)           (5.8) 
                                     -----------  ---------  -------  ------  -------  -------------- 
 

(1) Restated for IAS 38 IFRIC adjustments as detailed in the basis of preparation (note 1).

The closing net book value of goodwill, other intangible assets, property, plant and equipment, right of use assets and investments is analysed by geographic area as follows(1) :

 
                        United Kingdom          North America          Rest of World              Total 
                     Unaudited               Unaudited    Audited   Unaudited   Audited   Unaudited    Audited 
                           six     Audited         six       year         six      year         six       year 
                        months        year      months      ended      months     ended      months      ended 
                         ended       ended       ended         30       ended        30       ended         30 
                      31 March     30 Sept    31 March       Sept    31 March      Sept    31 March       Sept 
                          2022        2021        2022       2021        2021      2021        2022       2021 
                          GBPm        GBPm        GBPm       GBPm        GBPm      GBPm        GBPm       GBPm 
 
 Goodwill                111.0       111.0       356.8      341.4         4.6       4.7       472.4      457.1 
 Other intangible 
  assets                  31.9        33.2       162.5      154.7         0.4       0.3       194.8      188.2 
 Property, plant 
  and equipment            1.3         3.5         5.7        7.6         0.2       0.3         7.2       11.4 
 Right of use 
  assets                   6.8        18.9        17.9       23.0         1.8       2.3        26.5       44.2 
 Investments               8.9         8.9         0.1        0.2           -         -         9.0        9.1 
                    ----------  ----------  ----------  ---------  ----------  --------  ----------  --------- 
 Non-current 
  assets                 159.9       175.5       543.0      526.9         7.0       7.6       709.9      710.0 
                    ----------  ----------  ----------  ---------  ----------  --------  ----------  --------- 
 Additions to 
  property, 
  plant and 
  equipment              (0.1)           -       (0.1)      (0.1)           -     (0.5)       (0.2)      (0.6) 
 Additions to 
  right 
  of use assets              -           -       (0.2)          -           -     (0.5)       (0.2)      (0.5) 
 Additions to 
  other 
  intangible 
  assets                 (1.6)       (3.2)       (0.4)      (1.4)           -         -       (2.0)      (4.6) 
                    ----------  ----------  ----------  ---------  ----------  --------  ----------  --------- 
 
 

The Group has taken advantage of paragraph 23 of IFRS 8 'Operating Segments' and does not provide segmental analysis of net assets as this information is not used by the CODM in operational decision making or monitoring of business performance.

3 Seasonality of results

The Group's results are usually not materially affected by seasonal or cyclical trading. For the year ended 30 September 2021, the Group earned 46% of its revenue and 53% of its adjusted operating profits in the first six months of the year (2020: 56% of its revenue and 67% of its adjusted operating profit in the six months of the year).

4 Exceptional items

Exceptional items are items of income or expense considered by the Directors as being significant, non-recurring and which require additional disclosure in order to provide an indication of the underlying trading performance of the Group.

 
                                                                          Unaudited     Unaudited    Audited 
                                                                         six months    six months       year 
                                                                              ended         ended      ended 
                                                                           31 March      31 March    30 Sept 
                                                                               2022          2021       2021 
                                                               Notes           GBPm          GBPm       GBPm 
 
 Right of use and property, plant and equipment impairments      a           (19.1)             -      (3.0) 
 Other exceptional costs                                         b            (1.2)         (4.5)      (8.6) 
 Restructuring                                                   c                -         (2.3)      (2.3) 
 Recycling of foreign exchange                                   d                -         (1.2)      (1.2) 
 Exceptional items                                                           (20.3)         (8.0)     (15.1) 
                                                                       ------------  ------------  --------- 
 
 
      a.   For the period ended 31 March 2022, following the successful introduction 
            of flexible working across the Group, the real estate requirements 
            have been reviewed and the Group has identified significant opportunities 
            to reduce the office costs in London and New York to reflect the 
            footprint that suits the Group's needs. As a result, exceptional 
            impairments of GBP19.1m were booked against right of use assets and 
            other fixed assets (note 12). 
 
            For the year ended 30 September 2021, GBP3.0m of impairments to right 
            of use assets and property, plant and equipment were recognised in 
            exceptional items, due to management's intention to vacate a number 
            of properties across the Group. 
      b.   For the period ended 31 March 2022, other exceptional costs of GBP1.2m 
            consist of expenditure associated with acquisition related costs, 
            mainly for Boardroom Insiders (note 9), Relationship Science, The 
            Jacobsen and WealthEngine, treated as exceptional due to the magnitude 
            of the costs. The recognition of the earn-out payments for the acquisitions 
            of AgriCensus are treated as compensation costs and included in exceptional 
            items. 
 
            For the periods ended 31 March 2021 and 30 September 2021, other 
            exceptional costs consisted of expenditure associated with the acquisition 
            Wealth-X, AgriCensus, WealthEngine, The Jacobsen and RelSci, treated 
            as exceptional due to the magnitude of the costs. The recognition 
            of the earn-out payments for the acquisitions of AgriCensus were 
            treated as compensation costs and included in exceptional items. 
            Also included were costs incurred to support the strategic review 
            of Asset Management as well as significant costs associated with 
            an acquisition that did not complete. A recovery of VAT was also 
            included relating to a reclaim in respect of share buy-back related 
            expenditure previously recorded in exceptional items. 
      c    For the periods ended 31 March 2021 and 30 September 2021, expenses 
            of GBP2.3m were incurred as a result of the major restructuring across 
            the Group and were included in exceptional items. This comprised 
            severance costs and professional costs associated with the restructuring. 
            Normal restructuring costs were not treated as exceptional items. 
            There are no exceptional restructuring costs in the period ended 
            31 March 2022. 
      d.   For the periods ended 31 March 2021 and 30 September 2021, foreign 
            exchange gains/losses amounting to GBP1.2m were recycled from equity 
            to exceptional items. This related to foreign exchange gains/losses 
            on quasi-equity loans and net investment hedging that had been deferred 
            to equity in previous years. These amounts were recycled because 
            the net investment or party to the quasi-equity loan is no longer 
            part of the Group. As these items are not material, no restatement 
            was made. 
 

5 Finance expense

 
                                                                            Unaudited     Unaudited    Audited 
                                                                           six months    six months       year 
                                                                                ended         ended      ended 
                                                                             31 March      31 March    30 Sept 
                                                                                 2022          2021       2021 
                                                                                 GBPm          GBPm       GBPm 
 Finance expense 
   Interest payable on borrowings                                               (0.9)         (0.6)      (2.2) 
   Interest on lease liabilities                                                (0.8)         (0.9)      (1.8) 
   Net interest expense on defined benefit pension liability                        -         (0.1)          - 
   Interest on tax                                                              (0.2)         (0.3)      (0.5) 
                                                                                (1.9)         (1.9)      (4.5) 
                                                               ----------------------  ------------  --------- 
 
 
                                                                                    Unaudited     Unaudited    Audited 
                                                                                   six months    six months       year 
                                                                                        ended         ended      ended 
                                                                                     31 March      31 March    30 Sept 
                                                                                         2022          2021       2021 
                                                                                         GBPm          GBPm       GBPm 
 Reconciliation of finance expense in the Income Statement to adjusted 
 finance expense 
 Finance expense in the Income Statement                                                (1.9)         (1.9)      (4.5) 
 Add back: 
   Interest on tax                                                                        0.1           0.2        0.3 
 Adjusted finance expense                                                               (1.8)         (1.7)      (4.2) 
                                                                         --------------------  ------------  --------- 
 

The reconciliation of finance expense in the Income Statement has been provided since the Directors consider it necessary in order to provide an indication of the adjusted finance expense. Refer to the glossary to the Half Year Report for a detailed reconciliation of the Group's statutory results to the adjusted results.

Interest on tax excluded from the adjusted net finance expense consist of an interest charge of GBP0.1m (31 March 2021: GBP0.1m; 30 September 2021: GBP0.3m) for movements in respect of uncertain tax positions.

6 Tax expense on profit

 
                                 Unaudited six months ended       Restated unaudited six         Audited year ended 30 
                                              31 March 2022   months ended 31 March 2021                September 2021 
                                                       GBPm                         GBPm                          GBPm 
 
 Current tax expense 
 UK corporation tax expense                             0.7                        (1.0)                         (1.3) 
 Foreign tax expense                                    5.3                          3.1                          12.8 
 Adjustments in respect of 
  prior periods                                       (1.6)                            -                           0.6 
                               ----------------------------  ---------------------------  ---------------------------- 
                                                        4.4                          2.1                          12.1 
 Deferred tax 
 (credit)/expense 
 Current year                                         (1.6)                          6.8                           0.2 
 Impact of change in rate on 
  deferred tax                                          0.1                            -                           1.8 
 Adjustments in respect of 
  prior periods                                         0.1                        (0.1)                         (0.1) 
                               ---------------------------- 
                                                      (1.4)                          6.7                           1.9 
                               ----------------------------  ---------------------------  ---------------------------- 
 Total tax expense in Income 
  Statement(1)                                          3.0                          8.8                          14.0 
                               ----------------------------  ---------------------------  ---------------------------- 
 Effective tax rate                                     40%                          57%                           53% 
 

(1) Restated for IAS 38 IFRIC adjustments as detailed in the basis of preparation (note 1).

 
                               Unaudited six months ended       Restated unaudited six 
                                                 31 March        months ended 31 March    Audited year ended 30 Sept 
                                                     2022                         2021                          2021 
                                                     GBPm                         GBPm                          GBPm 
 Reconciliation of tax 
 expense in Income Statement 
 to adjusted tax expense 
 Total tax expense in Income 
  Statement                                           3.0                          8.8                          14.0 
 Add back: 
   Tax on acquired 
    intangible amortisation                           1.6                          1.5                           3.0 
   Tax on exceptional items                           4.6                          0.9                           3.1 
   Other tax adjusting items                            -                            -                         (6.0) 
   Transfer of deferred tax 
   liabilities                                          -                        (1.5)                             - 
   Derecognition of deferred 
   tax assets                                           -                        (2.6)                             - 
   Deferred tax on goodwill 
    and intangible 
    amortisation                                    (0.8)                        (0.7)                         (1.5) 
   Impact of rate change                            (0.1)                            -                             - 
   Share of tax on profits 
    of associates                                       -                            -                           0.1 
   Adjustments in respect of 
    prior periods                                     1.6                          0.1                         (0.5) 
                                                      6.9                        (2.3)                         (1.8) 
                              ---------------------------  ---------------------------  ---------------------------- 
 Adjusted tax expense                                 9.9                          6.5                          12.2 
                              ---------------------------  ---------------------------  ---------------------------- 
 
 Adjusted profit before tax 
  (refer to the glossary to 
  the Half Year Statement)                           38.6                         33.2                          61.4 
 Adjusted effective tax rate                          25%                          20%                           20% 
                              ---------------------------  ---------------------------  ---------------------------- 
 
 

Factors affecting the tax expense

The statutory effective tax rate (ETR) for the period ended 31 March 2022 is 40% compared with 57% for the period ended 31 March 2021. The statutory ETR for the 2022 full year is forecast to be 33% (2021 full year: 53%). The first half statutory ETR is largely driven by different rates of tax in the Group's overseas subsidiaries, a one-off intercompany interest expense disallowance arising as a result of group restructuring activities, and tax credits relating to the Group's decision to vacate of some of its office spaces in London and New York (note 4). Also included in the ETR is the tax impact of non-recoverable withholding tax on dividends from the Group's Canadian subsidiary as a result of the Group's change in approach in repatriation strategy.

In 2021 the Group incurred GBP5.4m UK and Canadian withholding taxes that were subsequently paid to HM Revenue and Customs and the Canada Revenue Agency in the six months ended 31 March 2022 and are therefore included within the amounts shown as Income Taxes paid in the Condensed Consolidated Statement of Cash Flows in that period. Excluding this payment, the Group has paid GBP7.1m in the six months ended 31 March 2022. The net amounts paid in the six months to 31 March 2021 were reduced due to lower cash tax liabilities and refunds received from New York City, New York State and the Canada Revenue Agency of GBP2.9m following the resolution of tax audits.

6 Tax expense on profit continued

Reconciliation of tax expense in Income Statement to adjusted tax expense

The adjusted effective tax rate for the 2022 half year is 25% (2021: 20%). The forecast adjusted effective tax rate for the 2022 full year is 23% (2021: 20%). The key drivers of the adjusted ETR are a non-recurring non-deductible interest expense in the US and the non-recoverable withholding tax on Canadian dividends.

Current and deferred tax arising on exceptional items is excluded from the adjusted tax charge as exceptional items are adjusted in accordance with Group policy. Adjustments in respect of prior years are also removed from the adjusted tax expense as they do not relate to current year underlying trading. Share of tax on profits of associates and joint ventures is calculated on the adjusted profits

of associates and joint ventures.

The Group also excludes the deferred tax impact of amortisation of intangibles and goodwill as any deferred tax on these items would only crystallise in the event of a disposal and that is not the current intention. The Group also excludes the tax impact of a one-off intercompany interest expense disallowance in the US which arose as a result of group restructuring activities and therefore does not relate to current year underlying trading.

Factors affecting the tax expense in future years and other tax matters

As a result of the Group's change to filing combined state tax returns in New York City (NYC) and New York State (NYS), the Group settled a tax enquiry into this matter with the NYS Department of Taxation and Finance in the prior year. As a result of the settlement with NYS the Group was also required to notify the NYC Department of Finance, which it did in January 2022. At the period end date, no enquiry had been opened in NYC into this matter.

As at 31 March 2022, the Group has state tax losses carried forward in NYC and NYS of GBP49m (30 September 2021: GBP57m) of which GBP44m (30 September 2021: GBP52m) expires in 2035 and GBP5m (30 September 2021: GBP5m) expires in 2037. Taking into account state rates and apportionment factors, the value of the amount recognised is GBP3.5m (30 September 2021: GBP4.1m).

The group has unrecognised non-trading and capital losses in the UK of GBP5.6m, trading losses in Singapore of GBP16.4m and federal losses in the US of GBP14.4m. These losses are not recognised because it is not probable that appropriate taxable profits will be generated in the appropriate jurisdiction either for the foreseeable future, or before the losses in the US expire between 2025 and 2037.

The Group holds a full provision in respect of a UK tax exposure relating to an enquiry by HMRC into the tax treatment of the disposal of an investment in the "Capital Data" business during the year ended 30 September 2015. This has a maximum exposure of GBP10.7m, plus estimated interest to date of GBP2m. Following a first-tier tax tribunal (FTT) hearing held in May 2020, the Group received a judgement in its favour. HMRC have appealed this judgement at the Upper Tier Tribunal and the case will be held in early July 2022. The Group's assessment after seeking professional advice is that there has been no change to the likelihood of HMRC ultimately prevailing and therefore no adjustment to the provision is being made at this time.

In October 2021, the 137 members of the Organisation for Economic Co-operation and Development (OECD) reached an agreement on two proposed "Pillars" of work addressing the Taxation of the Digital Economy. The proposals are complex and are subject to further negotiation with a 2023 target date for implementation of the proposed changes.

Pillar One is in relation to nexus and profit reallocation between taxing jurisdictions. In February 2022 the OECD issued a draft consultation document with draft Model rules on "Amount A" (the allocation of profits to a jurisdiction) in April 2022. Currently companies in scope are multinational enterprises (MNEs) with global turnover above EUR20 billion and profitability above 10%, and therefore it is not probable that this will have an impact on the Group.

Pillar Two focuses on Global Anti-Base Erosion ("GloBE") and aims to ensure that large MNEs pay a minimum level of corporate income tax in countries where they operate. Following a July 2021 meeting of the OECD in the UK, in December 2021 a set of model GloBE rules were released, including a global minimum 15% tax rate, with commentary and guidance on the rules issued in March 2022. As the proposals include a consolidated revenue threshold of EUR750m (GBP630m), the changes are unlikely to have any impact on the Group effective tax rate or payments for the foreseeable future. Although the Group does not currently meet the threshold, we will monitor the implications of these rules as the discussions proceed.

7 Dividends

 
                                                                                 Unaudited     Unaudited    Audited 
                                                                                six months    six months       year 
                                                                                     ended         ended      ended 
                                                                                  31 March      31 March    30 Sept 
                                                                                      2022          2021       2021 
                                                                                      GBPm          GBPm       GBPm 
 Amounts recognisable as distributable to equity holders in period 
 Final dividend for the year ended 30 September 2021 of 12.5p (2020: 11.4p)           13.7          12.4       12.5 
 Interim dividend for the year ended 30 September 2021 of 5.7p (2020: nil)               -             -        6.2 
                                                                              ------------  ------------  --------- 
                                                                                      13.7          12.4       18.7 
 Employee share trust dividends waived                                               (0.2)         (0.1)      (0.2) 
                                                                                      13.5          12.3       18.5 
                                                                              ------------  ------------  --------- 
 

The final dividend for the year to 30 September 2021 was approved by shareholders at the AGM held on 9 February 2022 and paid on 15 February 2022.

It is anticipated that the half year dividend of 6.1p (2021: 5.7p) per share will be paid on 24 June 2022 to shareholders on the register on 27 May 2022. It is expected that the shares will be marked ex-dividend on 26 May 2022. The half year dividend has not been included as a liability in this Half Year Financial Statement in accordance with IAS 10 'Events after the Reporting Period'.

8 Earnings per share

 
                              Unaudited   Restated(1) unaudited    Audited 
                             six months              six months       year 
                                  ended                   ended      ended 
                               31 March                31 March    30 Sept 
                                   2022                    2021       2021 
                                   GBPm                    GBPm       GBPm 
 
 Profit for the period              4.6                     6.6       12.6 
 Adjustments                       24.1                    20.1       36.6 
                           ------------  ----------------------  --------- 
 Total adjusted earnings           28.7                    26.7       49.2 
                           ------------  ----------------------  --------- 
 
 
                                                Unaudited             Unaudited            Audited 
                                               six months            six months               year 
                                                    ended                 ended              ended 
                                                 31 March              31 March            30 Sept 
                                                     2022                  2021               2021 
                                                   Number                Number             Number 
                                                      000                   000                000 
 
 Weighted average number of shares                109,290               109,289            109,289 
 Shares held by the employee share trusts         (1,199)               (1,216)            (1,207) 
                                             ------------  --------------------  ----------------- 
 Weighted average number of shares                108,091               108,073            108,082 
 Effect of dilutive share options                     103                   199                 25 
 Diluted weighted average number of shares        108,194               108,272            108,107 
                                             ------------  --------------------  ----------------- 
 
                                                                    Restated(1) 
                                                    Pence                 Pence              Pence 
 Earnings per share 
   Basic                                              4.2                   6.1               11.7 
   Diluted                                            4.2                   6.1               11.7 
 
 Adjusted earnings per share 
   Basic                                             26.6                  24.7               45.5 
   Diluted                                           26.6                  24.6               45.5 
 

(1) Restated for IAS 38 IFRIC adjustments as detailed in the basis of preparation (note 1).

The adjusted earnings per share figures have been disclosed since the Directors consider it necessary in order to give an indication of the adjusted trading performance reflecting the performance of the Group. A detailed reconciliation of the Group's statutory results to the adjusted results is set out in the glossary to the Half Year Report.

9 Acquisitions and disposals

PURCHASE OF BUSINESS

Boardroom Insiders Inc

On 20 January 2022, the Group acquired 100% of the equity share capital of Boardroom Insiders Inc. for $25.3m (GBP18.7m). Boardroom Insiders is a market-leading provider of people intelligence to technology companies and professional services. The business has profiles on over 30,000 executives and key decision makers. These profiles, and the intelligence provided from its proprietary analytics capability, are primarily used by sales teams for business development and account management purposes. Boardroom Insiders is included in the Financial & Professional Services division.

The acquisition accounting is set out below and is provisional pending final determination of the fair value of the assets and liabilities acquired:

 
                                                           Fair value   Provisional 
                                             Book value   adjustments    fair value 
                                                   GBPm          GBPm          GBPm 
 
 Intangible assets                                    -          12.5          12.5 
 Trade and other receivables                        0.6             -           0.6 
 Trade and other payables                         (0.2)             -         (0.2) 
 Deferred tax liabilities                             -         (0.1)         (0.1) 
 Contract liabilities                             (1.5)           0.2         (1.3) 
 Cash and cash equivalents                          0.3             -           0.3 
                                                  (0.8)          12.6          11.8 
                                            -----------  ------------  ------------ 
 
 Net assets acquired (100%)                                                    11.8 
 Goodwill                                                                       6.9 
 Total consideration                                                           18.7 
                                                                       ------------ 
 Consideration satisfied by: 
 Cash                                                                          16.6 
 Deferred consideration                                                         1.8 
 Working capital adjustments                                                    0.3 
                                                                               18.7 
                                                                       ------------ 
 Net cash outflow arising on acquisition: 
 Cash consideration                                                            16.9 
 Less: cash and cash equivalent balances 
  acquired                                                                    (0.3) 
                                                                               16.6 
                                                                       ------------ 
 

Intangible assets represent customer relationships of $8.2m (GBP6.0m), a database of $5.9m (GBP4.4m), a platform of $1.9m (GBP1.4m) and a brand of $0.9m (GBP0.7m) for which amortisation of $0.6m (GBP0.5m) has been charged for the six months ended 31 March 2022. The intangible assets will be amortised over their respective useful economic lives; customer relationships of 11 years, database of 3 years, platform of 3.5 years and brand of 10 years.

Goodwill arises from the anticipated future operating synergies from integrating the acquired operations within the Group and the acquired workforce.

The fair value adjustment to deferred tax represents the deferred tax impact of the acquisition accounting, mainly being the adjustment to contract liabilities.

Boardroom Insiders contributed GBP0.6m to the Group's revenue and GBP0.1m, before acquired intangible amortisation, to the Group's operating profit and profit before tax between the date of acquisition and 31 March 2022. If the acquisition had been completed on the first day of the financial year, Boardroom Insiders would have contributed GBP1.6m to the Group's revenue and a loss of GBP0.1m to the Group's operating profit and profit before tax.

For the six months ended 31 March 2022, acquisition related costs of GBP0.4m relating to the Boardroom Insiders acquisition have been charged to the Consolidated Income Statement.

10 Investments

 
                                                                        Investment                Other 
                                                                                     equity investments 
                                                                     in associates                         Total 
                                                                              GBPm                 GBPm     GBPm 
 
 At 1 October 2020                                                             8.8                    -      8.8 
 Additions                                                                       -                  0.1      0.1 
 Revaluation                                                                     -                  0.1      0.1 
 At 30 September 2021                                                          8.8                  0.2      9.0 
                                                                    --------------  -------------------  ------- 
 Share of profits before tax and acquired intangible amortisation              0.2                    -      0.2 
 Share of acquired intangible amortisation                                   (0.2)                    -    (0.2) 
 At 31 March 2022                                                              8.8                  0.2      9.0 
                                                                    --------------  -------------------  ------- 
 

The investment in associates is accounted for using the equity method in these condensed consolidated interim financial statements. Other equity investments are classified as financial assets measured at fair value through other comprehensive income.

 
                                                                                    Unaudited     Unaudited    Audited 
                                                                                   six months    six months       year 
                                                                                        ended         ended      ended 
                                                                                     31 March      31 March    30 Sept 
                                                                                         2022          2021       2021 
                                                                                         GBPm          GBPm       GBPm 
 Reconciliation of share of results in associates in Income Statement to 
 adjusted share of 
 results in associates 
 Total share of results in associates in Income Statement                                   -         (0.1)          - 
 Add back: 
   Share of acquired intangible amortisation                                              0.2           0.2        0.3 
 Adjusted share of results in associates                                                  0.2           0.1        0.3 
                                                                                 ------------  ------------  --------- 
 

The reconciliation of share of results in associates in the Income Statement has been provided since the Directors consider it necessary in order to provide an indication of the adjusted share of results in associates. Refer to the glossary to the Half Year Report.

10 Investments continued

Information on investment in associates:

 
                                          Year       Date of         Type      Group        Registered 
                  Principal activity     ended   acquisition   of holding   interest            office 
 Investment 
  in associates 
 Zanbato, Inc     Private capital      30 Sept     Sept 2015     Ordinary      11.8%   715 N Shoreline 
  (Zanbato)        placement and                                                            Boulevard, 
                   workflow                                                                   Mountain 
                                                                                              View CA, 
                                                                                         94043, United 
                                                                                                States 
 

The investment in Zanbato is one of the Group's strategic investments.

IAS 28 'Investments in associates and joint ventures' requires that the fair value of assets and liabilities of associates is identified and that the Group's share of profit from Zanbato is adjusted for the amortisation of the acquired intangible assets. The Group has recognised its share of acquired intangible amortisation of GBP0.2m (31 March 2021: GBP0.2m; 30 September 2021: GBP0.3m) relating to the database intangible asset.

The Group has two other equity investments measured at fair value through other comprehensive income, Estimize has a fair value of nil at 31 March 2022 (2021: nil) and NDR Investment Solutions strategies fair value as at 31 March 2022 is GBP0.2m (2021: GBP0.2m).

11 Goodwill and other intangibles

There was an increase in goodwill in the six months to 31 March 2021 of GBP15.3m. This movement relates to exchange differences of GBP8.4m and GBP6.9m arising on the acquisition of Boardroom Insiders (note 9). Acquired intangible assets increased by GBP6.1m due to GBP12.5m arising on the acquisition of Boardroom Insiders (note 9) and exchange differences of GBP4.0m, offset by GBP10.4m of amortisation.

The net carrying value of goodwill and other intangible assets is as follows:

 
                                           Unaudited    Audited 
                                               as at      as at 
                                            31 March    30 Sept 
                                                2022       2021 
                                                GBPm       GBPm 
 
 Goodwill                                      472.4      457.1 
                                          ----------  --------- 
 
 Trademarks and brands                          75.3       77.6 
 Customer relationships                         82.8       78.5 
 Databases and software                         24.4       20.3 
                                          ----------  --------- 
 Total acquired intangible assets              182.5      176.4 
 Internally generated intangible assets         12.3       11.8 
                                          ----------  --------- 
 Total intangible assets                       194.8      188.2 
                                          ----------  --------- 
 
 Total                                         667.2      645.3 
                                          ----------  --------- 
 

Intangible assets, other than goodwill, have a finite life and are amortised over their expected useful lives at the rates set out in the accounting policies in note 1 of the 2021 Annual Report and Accounts.

Acquired intangible amortisation for the period ended 31 March 2022 is GBP10.4m (31 March 2021: GBP9.4m; 30 September 2021: GBP19.0m).

The Group assesses, at each reporting period, whether there is an indication that an asset might be impaired, and if such indication exists, estimate the asset's recoverable amount. For the period ended 31 March 2022 the Group considered, amongst other factors, the performance of assets and groups of cash generating units in the first half compared to the forecasts used in the year-end impairment tests as well as the Group's latest expectation of future cash flows. No indicators of impairment were identified.

12 Right of use assets

Right of use assets recognised by the Group are for leasehold premises, predominately used as office space.

The table below shows the movements in right of use assets during the period.

 
                                         Leasehold office space 
 2022                                                      GBPm 
 Cost 
 At 1 October 2021                                         60.6 
 Additions                                                  0.2 
 Disposals                                                (0.2) 
 Exchange differences                                       0.8 
                                       ------------------------ 
 At 31 March 2022                                          61.4 
                                       ------------------------ 
 Depreciation and impairments 
 At 1 October 2021                                         16.4 
 Depreciation                                               3.0 
 Impairments                                               15.5 
 Disposals                                                (0.2) 
 Exchange differences                                       0.2 
                                       ------------------------ 
 At 31 March 2022                                          34.9 
                                       ------------------------ 
 Net book value at 31 March 2022                           26.5 
                                       ------------------------ 
                                         Leasehold office space 
 2021                                                      GBPm 
 Cost 
 At 1 October 2020                                         61.2 
 Additions                                                  0.5 
 Balance at acquisition of company                          1.9 
 Disposals                                                (0.3) 
 Reassessments                                            (1.1) 
 Exchange differences                                     (1.6) 
                                       ------------------------ 
 At 30 September 2021                                      60.6 
                                       ------------------------ 
 Depreciation and impairments 
 At 1 October 2020                                          7.8 
 Depreciation                                               6.6 
 Impairments                                                2.4 
 Disposals                                                (0.3) 
 Exchange differences                                     (0.1) 
                                       ------------------------ 
 At 30 September 2021                                      16.4 
                                       ------------------------ 
 Net book value at 30 September 2021                       44.2 
                                       ------------------------ 
 

Impairments

The Group intends to exit its New York office. After exploring options, it has recognised exceptional impairments against property, plant and equipment of GBP1.6m and ROU assets of GBP4.8m (note 4). The ROU asset will be disposed of when the lease is exited.

The Group intends to sublet a portion of its London offices and has recognised an impairment of GBP10.7m against ROU assets and GBP2.0m against related property, plant and equipment (note 4), fully writing down the related assets. The recoverable value using value in use methodology utilising discounted cash flows, assuming that market rents will be received for a period of three years following an initial 12-month period where the space is vacant for fit-out and marketing. The assumptions reflect advice that the Group received from its property advisers. A pre-tax discount rate of 9.7% was used. The sublease term would have to increase to four years and three months before the impairment would be reversed. The impairment charge is not sensitive to the market rents assumption.

Rent expense

The rent expense recognised in the Consolidated Income Statement in respect of short-term leases was GBP0.3m (31 March 2021: GBP0.2m; 30 September 2021: GBP0.4m).

13 Lease liabilities

The table below shows the movements in lease liabilities during the period.

 
                                      Lease liabilities 
                                                   GBPm 
 At 30 September 2020                              70.1 
 Additions                                          0.5 
 Balance at acquisition of company                  1.9 
 Reassessments                                    (1.1) 
 Finance charge in year                             1.8 
 Lease payments in year                           (9.8) 
 Exchange differences                             (1.7) 
                                     ------------------ 
 At 30 September 2021                              61.7 
                                     ------------------ 
 Additions                                          0.2 
 Finance charge in year                             0.8 
 Lease payments in year                           (4.7) 
 Exchange differences                               0.8 
                                     ------------------ 
 At 31 March 2022                                  58.8 
                                     ------------------ 
 

The maturity profile of the Group's lease payments is shown below.

 
                                                Lease payments 
 Timing of future lease payments                          GBPm 
 Within 12 months                                          9.1 
 1 - 3 years                                              22.0 
 4 - 5 years                                              13.9 
 Over 5 years                                             21.4 
                                               --------------- 
                                                          66.4 
 Impact of discounting future lease payments             (7.6) 
                                               --------------- 
 Lease liabilities at 31 March 2022                       58.8 
                                               --------------- 
 

14 Financial instruments

The Group's financial assets and liabilities are as follows:

 
                                                                  Unaudited    Audited 
                                                                      as at      as at 
                                                                   31 March    30 Sept 
                                                                       2022       2021 
                                                                       GBPm       GBPm 
 Financial assets 
 Fair value through profit or loss (FVTPL) assets 
 Derivative instruments                                                 0.5        1.9 
 Cash and cash equivalents - money market funds                         5.4       26.5 
 Fair value through other comprehensive income (FVTOCI) assets 
 Other equity investments                                               0.2        0.2 
 Amortised cost 
 Trade receivables and other debtors                                   99.9       79.0 
 Cash and cash equivalents - amortised cost                             7.1        6.0 
                                                                      113.1      113.6 
                                                                 ----------  --------- 
 Financial liabilities 
 Fair value through profit or loss liabilities 
 Derivative instruments                                               (1.9)      (0.9) 
 Amortised cost                                                                      - 
 Acquisition commitments                                              (0.1)      (0.1) 
 Deferred consideration                                               (1.9)          - 
 Borrowings and payables                                             (67.5)     (89.1) 
                                                                     (71.4)     (90.1) 
                                                                 ----------  --------- 
 

The Group recorded an expected credit loss of GBPnil (31 March 2021: GBP1.5m) in the first half as a result of updating the expected credit loss provision for the latest aging and credit loss assumptions. There is no material exposure to the ongoing war in Ukraine, including the resulting cessation of trade with businesses in Russia.

Fair value of financial instruments

The fair values of financial assets and financial liabilities are determined in accordance with IFRS 13 'Fair Value Measurement' as follows:

 
Level 1 
    The fair value of financial assets and financial liabilities with standard 
     terms and conditions and traded on active liquid markets is determined 
--   with reference to quoted market prices. 
 
Level 2 
    The fair value of other financial assets and financial liabilities 
     (excluding derivative instruments) is determined in accordance with 
     generally accepted pricing models based on discounted cash flow analysis 
     using prices from observable current market transactions and dealer 
--   quotes for similar instruments. 
    Foreign currency forward contracts are measured using quoted forward 
     exchange rates and yield curves derived from quoted interest rates 
--   matching maturities of the contracts. 
    Money market funds are valued at the closing price reported by the 
--   fund sponsor. 
 
Level 3 
    If one or more significant inputs are not based on observable market 
--   data, the instrument is included in level 3. 
 

14 Financial instruments continued

Other financial instruments not recorded at fair value

The Directors consider that the carrying amounts of financial assets and financial liabilities recorded at amortised cost in the Financial Statements approximate their fair values.

The Group classifies its financial instruments into the following categories:

 
                                                                             IFRS 9 
 Financial instrument category                                 measurement category   Fair value measurement hierarchy 
 Derivative instruments                                                    FVTPL(1)                                  2 
 Other equity investments                                                    FVTOCI                                  3 
 Deferred consideration asset                                        Amortised cost                                N/A 
 Receivables                                                         Amortised cost                                N/A 
 Cash and cash equivalents - cash at bank and short-term 
 deposits                                                            Amortised cost                                N/A 
 Cash and cash equivalents - money market funds                               FVTPL                                  2 
 Deferred consideration liability                                    Amortised cost                                N/A 
 Acquisition commitments                                             Amortised cost                                N/A 
 Borrowings and payables                                             Amortised cost                                N/A 
 

(1) Changes in fair value to derivatives designated in cash flow hedging relationships, to the extent that the hedge is effective, are taken to the hedging reserve through other comprehensive income. Any ineffectiveness is recognised in profit or loss.

Movements in assets/(liabilities) arising from financing activities:

 
 
                                                                     Interest 
                                                                    and other 
                         As at 30 Sept 2021   Cash flow    non-cash movements   Foreign exchange   As at 31 March 2022 
                                       GBPm        GBPm                  GBPm               GBPm                  GBPm 
 Net cash comprises: 
 Cash and cash 
  equivalents                          32.5      (20.5)                                      0.5                  12.5 
 Borrowings                               -         0.1                 (0.1)                  -                     - 
                        -------------------  ----------  --------------------  -----------------  -------------------- 
 Net cash                              32.5      (20.4)                 (0.1)                0.5                  12.5 
                        -------------------  ----------  --------------------  -----------------  -------------------- 
 
 Analysis of changes 
 in liabilities from 
 financing activities 
 Borrowings                               -         0.1                 (0.1)                  -                     - 
 Other financing items 
  - Prepaid bank fees                   1.2           -                 (0.3)                  -                   0.9 
 Interest payable                     (2.5)         0.6                 (1.1)                  -                 (3.0) 
 Lease liabilities                   (61.7)         4.7                 (1.0)              (0.8)                (58.8) 
 Acquisition 
  commitments                         (0.1)           -                     -                  -                 (0.1) 
                        -------------------  ----------  --------------------  -----------------  -------------------- 
 Total liabilities 
  from financing 
  activities                         (63.1)         5.4                 (2.2)              (0.8)                (61.0) 
                        -------------------  ----------  --------------------  -----------------  -------------------- 
 

15 Borrowings

 
                                           Unaudited    Audited 
                                               as at      as at 
                                            31 March    30 Sept 
                                                2022       2021 
                                                GBPm       GBPm 
 
 Undrawn available committed facilities        190.0      190.0 
                                          ----------  --------- 
 

The Group's principal source of borrowings is provided through a committed bank facility. The facility is available to the Group until May 2024, with two additional one-year extension options available. Since the reporting date, this facility has been extended by a year, to May 2025. There is a further accordion facility of GBP130m should the Group wish to request it. Drawings under the revolving credit facility bear interest charged at risk-free rates plus a margin, the applicable margin being based on the Group's ratio of adjusted net debt to EBITDA.

16 Called up share capital

 
                                                                 Unaudited    Audited 
                                                                     as at      as at 
                                                                  31 March    30 Sept 
                                                                      2022       2021 
                                                                      GBPm       GBPm 
 Allotted, called up and fully paid 
 109,290,215 ordinary shares of 0.25p each 
  (March 2021: 109,289,406 ordinary shares of 0.25p each) 
  (September 2021: 109,289,530 ordinary shares of 0.25p each)          0.3        0.3 
                                                                ----------  --------- 
 

17 Events after the balance sheet date

On 28 April 2022, the Group agreed an extension to its committed bank facility, up to 11 May 2025, with an additional one-year extension options available.

Responsibility Statement

We confirm that to the best of our knowledge:

 
 (a)   these Condensed Consolidated Interim Financial Statements, which 
        have been prepared in accordance with IAS 34 'Interim Financial Reporting', 
        give a true and fair view of the assets, liabilities, financial position 
        and profit of the Group as required by DTR 4.2.4R; 
 (b)   this Half Year Report includes a fair review of the information required 
        by DTR 4.2.7R (indication of important events during the first six 
        months and description of principal risks and uncertainties for the 
        remaining six months of the year); and 
 (c)   this Half Year Report includes a fair review of the information required 
        by DTR 4.2.8R (disclosure of related party transactions and changes 
        therein). 
 

By order of the Board,

Andrew Rashbass

Chief Executive Officer

18 May 2022

Wendy Pallot

Chief Financial Officer

18 May 2022

Independent review report to Euromoney Institutional Investor PLC

Report on the condensed consolidated interim financial statements

Our conclusion

We have reviewed Euromoney Institutional Investor PLC's condensed consolidated interim financial statements (the "interim financial statements") in the Half Year Report of Euromoney Institutional Investor PLC for the six month period ended 31 March 2022 (the "period").

Based on our review, nothing has come to our attention that causes us to believe that the interim financial statements are not prepared, in all material respects, in accordance with UK adopted International Accounting Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority.

The interim financial statements comprise:

 
      --   the Condensed Consolidated Statement of Financial Position at 31 
            March 2022; 
      --   the Condensed Consolidated Income Statement and Condensed Consolidated 
            Statement of Comprehensive Income for the period then ended; 
      --   the Condensed Consolidated Statement of Changes in Equity for the 
            period then ended; 
      --   the Condensed Consolidated Statement of Cash Flows for the period 
            then ended; and 
      --   the explanatory notes to the interim financial statements. 
 

The interim financial statements included in the Half Year Report of Euromoney Institutional Investor PLC have been prepared in accordance with UK adopted International Accounting Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority.

What a review of interim financial statements involves

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

We have read the other information contained in the Half Year Report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the interim financial statements.

Responsibilities for the interim financial statements and the review

Our responsibilities and those of the directors

The Half Year Report, including the interim financial statements, is the responsibility of, and has been approved by the directors. The directors are responsible for preparing the Half Year Report in accordance with the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority.

Our responsibility is to express a conclusion on the interim financial statements in the Half Year Report based on our review. This report, including the conclusion, has been prepared for and only for the company for the purpose of complying with the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority and for no other purpose. We do not, in giving this conclusion, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

PricewaterhouseCoopers LLP

Chartered Accountants

London

18 May 2022

Directors

 
 
 
   Executive Directors 
 Andrew Rashbass (Chief Executive Officer) 
 Wendy Pallot (Chief Financial Officer) 
 
 Non-executive Directors 
 Jan Babiak ++ (Senior Independent Director) 
 John (Jack) Callaway -- 
 Colin Day -- ++ 
 India Gary-Martin -- 
 Imogen Joss ++ 
 Tim Pennington -- 
 Leslie Van de Walle ++ (Chair) 
 
 
 member of the Remuneration Committee 
 ++ member of the Nominations Committee 
 -- member of the Audit & Risk Committee 
 

Board and Committee Composition Changes

On 1 March 2022, John Callaway was appointed to the Board as a Non-Executive Director and as a member of the Audit & Risk Committee.

Shareholder Information

Financial calendar

 
 2022 half year results announcement     Thursday 19 May 2022 
 Half year dividend ex-dividend 
  date                                   Thursday 26 May 2022 
 Half year dividend record date          Friday 27 May 2022 
 Payment of 2022 half year dividend      Friday 24 June 2022 
 Trading update                          Thursday 21 July 2022* 
                                         Tuesday 22 November 
 2022 final results announcement          2022* 
                                         Tuesday 29 November 
 Final dividend ex-dividend date          2022* 
                                         Wednesday 30 November 
 Final dividend record date               2022* 
                                         Thursday 2 February 
 Trading update                           2023* 
                                         Thursday 2 February 
 2023 AGM (approval of final dividend)    2023* 
                                         Wednesday 8 February 
 Payment of final dividend                2023* 
 

* Provisional dates and subject to change

Company Secretary and registered office

Tim Bratton

8 Bouverie Street

London

EC4Y 8AX

England registered number : 954730

Shareholder enquiries

Administrative enquiries about a holding of Euromoney Institutional Investor PLC shares should be directed in the first instance to the Company's registrars, Equiniti:

Telephone: 0371 384 2951 Lines are open 8:30am to 5:30pm (UK time), Monday to Friday, excluding English public holidays.

Overseas Telephone: (00) 44 121 415 0246

A number of facilities are available to shareholders through the secure online site: www.shareview.co.uk.

Advisors

 
 Independent Auditor       Brokers              Solicitors               Registrars 
  PricewaterhouseCoopers    UBS                  Cameron McKenna          Equiniti 
  LLP                       5 Broadgate          Nabarro Olswang          Aspect House 
  1 Embankment Place        London               LLP                      Spencer Road 
  London                    EC2M 2QS             78 Cannon Street         Lancing 
  WC2N 6RH                                       London                   West Sussex 
                                                 EC4N 6AF                 BN99 6DA 
 
                            Numis Securities     Freshfields Bruckhaus 
                            Limited              100 Bishopsgate 
                            45 Gresham Street    London 
                            London               EC2P 2SR 
                            EC2V 7BF 
 

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IR MZGMKGRRGZZZ

(END) Dow Jones Newswires

May 19, 2022 02:01 ET (06:01 GMT)

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