Half Year Financial Highlights:
DMGT underlying# revenue down 1%; reported revenue up 3%
Underlying operating profit* down 12%; operating margin resilient at 15%
B2B underlying revenue up 1% and underlying operating profit down 2%
dmg media underlying revenue decline of 3%, with print advertising decline of 13%; reduced profit margin resulted in underlying operating profit down 29%
Adjusted profit before tax of £129m, down 11%; adjusted earnings per share down 11%
Active portfolio management continued; acquisitions for dmg information, dmg events and dmg media, disposals of Wowcher and Local World completed
Net debt up £17m to £719m; net debt:EBITDA ratio of 2.0
Interim dividend increased by 3%
Outlook for the Full Year adjusted for change in guidance to dmg media's operating margin
Announcement of Chief Executive Martin Morgan's retirement and appointment of Paul Zwillenberg with effect from 1 June 2016
Statutory results, including exceptional items: revenue up 3%, operating profit down 15%, profit before tax up 54% and earnings per share up 27%
Martin Morgan, Chief Executive, commented:
"DMGT's performance in the first half was broadly in line with our expectations, other than the further deterioration in the UK print advertising market which impacted dmg media's results. The Group's revenue has remained broadly stable on an underlying basis, with growth from our B2B companies offsetting the decline from dmg media.
Within our international B2B companies, revenue growth at RMS, dmg information and dmg events was partly offset by Euromoney, which continues to face challenging market conditions. The operating profits of the B2B businesses declined slightly, by 2% on an underlying basis. The underlying revenues of our consumer business, dmg media, declined by 3%, with the growth from digital advertising revenues partially offsetting the decline in print advertising and circulation revenues. The reduced print advertising revenues had an adverse impact on dmg media's operating profits.
Relative to last year, the first half benefited from the occurrence of the Gastech event and from the stronger US dollar relative to sterling, although was adversely impacted by the disposal of Local World. Given the particularly weak print advertising market, dmg media is now expected to deliver an operating margin of around 10% for the Full Year whilst the expectations for the B2B businesses remain in line with previous guidance.
We have continued to actively manage our portfolio of businesses and have made several acquisitions and disposals during the period, in line with our strategy to improve the overall quality and growth prospects of the Group.
I will be retiring as Chief Executive at the end of this month, after 27 years with the Group and nearly 8 years as Chief Executive. I am delighted that Paul Zwillenberg has been appointed as my successor and confident that DMGT will remain well positioned to deliver long-term growth."