Daily Mail and General Trust’s (DMGT) nine-month trading update (to the end of June 2020), despite showing a strong first five months, illustrates that Covid-19 has inevitably affected trading since March, with Group revenues of £934m down an underlying 7%. Revenues dropped 23% in the third quarter of the Group’s financial year and adjusted profits are put at £63m for the period.
The figures for the events business are worse than those for the Group overall, given that DMGT’s subscription businesses, Insurance Risk, US Property Information and EdTech actually delivered 4% underlying revenue growth over the period in question.
The DMGT financial update, 23 July, noted there had been “seamless delivery of all products and services other than cancelled exhibitions”. Underlying growth in the exhibition business in the nine months to 30 June 2020 was down 11% and in the last three months of that period, it plummeted 30%.
The Group reported holding no events since February 2020.
The final quarter is usually much more significant for the Group’s events business and almost all events have been cancelled or postponed due to Covid-19. Gastech, which was scheduled to be held in Singapore in September 2020, has been postponed to September 2021.
For FY 2021, the scheduling of events has also been affected. Big 5 Dubai has been postponed to September 2021 from November 2020 and the ADIPEC exhibition will not be held in FY 2021, having been rescheduled to November 2021 from November 2020.
DMGT said it expects to recover US$20m in respect of FY 2020 event cancellations and postponements, from its insurance cover for communicable diseases, although the exact timing of recognition is uncertain. The Group has similar coverage for up to US$20m in respect of FY 2021 events.
Events & Exhibitions have clearly taken a big hit and that is likely to make for a very cautious outlook. The DMGT financial statement concluded that, “the businesses were positioned to respond to market conditions as lockdown restrictions change and each has a plan for the different scenarios that could occur. At this stage, the outlook for the Group remains uncertain and suspension of formal guidance continues.”