An estimated 410 events, consisting of 60 large brands and 350 small brands representing £610m, has been rescheduled by the exhibitions and information group as a result of Covid-19.
In response, the business is to issue a new placing of ordinary shares as part of an extension of its Covid-19 Action Plan. The proceeds of the placing will be used, the group said in a statement, to strengthen its balance sheet and reduce overall debt. The total number of placing shares and subscription shares will be approximately 19.99% of the company’s existing issued share capital and will equate to approximately £1bn. Combined with other financing measures, the share placing will increase Informa’s total liquidity to more than £2.3bn.
The company has also introduced voluntary pay cuts of 33% for the CEO and CFO, and 25% for the PLC Board and the international executive management team to support the business.
Stephen A. Carter, Group Chief Executive, Informa PLC, said: “Since the beginning of 2020, the impact of the Covid-19 pandemic has become progressively deeper and more far-reaching than initially predicted. We have continued to adapt and respond quickly, always prioritising the safety of Colleagues and Customers, making decisions for the long-term value of our brands and businesses and seeking to preserve jobs and invest in our intellectual property.”
The company’s subscriptions businesses (c35% of revenue) continues to grow with strong subscription renewals at Taylor & Francis and Informa Intelligence.
In particular, both Taylor & Francis and Pharma Intelligence have moved quickly to create information and data to support the scientific and medical response to the Covid-19 pandemic.
Prior to the outbreak, 2021 events continued to deliver strong rebooking performances, including Healthcare & Pharma (Arab Health +20%) and Construction & Real Estate (The Roofing Show +11%). The company has also reported less than 10% of events revenue had been cancelled to date.
Carter added: “The strength of our specialist brands and customer relationships continues to provide confidence in our long-term value. However, in the near-term, we are facing material disruption in our Events-related businesses, with expectations for a gradual and phased recovery.
“Today we are taking action to stay ahead of this by building further stability and strength across our business. Through a range of measures, further reducing direct and indirect costs, supporting Colleagues and fully securing our finances, we are ensuring we can continue to manage Informa in the best interests of its long-term stability and strength.”
The company has also introduced a range of financial scenarios based on possible impacts of Covid-19. These include an Operating Plan assuming zero revenue from events in the second quarter, and Vigilant Case that assumes a gradual return with zero revenues until the fourth quarter.
In addition, new financial control measures have been introduced including dividend suspension and discussions with US private placement debt holders. The company has also frozen recruitment and is currently reviewing agreements with contractors and consultants.
Carter, concluded: “Informa’s portfolio of resilient subscriptions businesses and leading B2B brands remain well positioned for future growth on the other side of the COVID-19 pandemic.
“Today’s actions, including an equity placing with full participation from the Group’s PLC Board and Executive Management Team, provide stability and strength, ensuring the focus remains on our customers and building further long-term value for shareholders.”