Once again full year underlying growth at publishing firm RELX (REL) came in at 4%, bang in line with the long-term trend and the fourth year in a row it has hit that mark.

The market has rewarded this reliability, with the shares rising 1.4% to £20.68 on a latest set of record numbers. Over the last decade it has delivered a total return of 383% according to data from Sharepad.

Overall revenue was up 5% to £7.9bn, with underlying growth of 4% reflecting growth in electronic and face-to-face revenue and the development of its analytics and decision tools, partially offset by print revenue declines.

Adjusted operating profit climbed 6% in 2019 to £2.5bn, while reported operating profit was up 7% to £2.1bn.

BUSY ON ACQUISITION FRONT

Over the course of 2019 RELX completed 14 acquisitions of content, data analytics and exhibition assets for a total consideration of £416m, and disposed of a number of small assets for a total of £63m in 2019. The company is proposing a full-year dividend of 45.7p, up 9%.

While the company sounds a confident tone on the outlook, Megabuyte analyst Amir Fattahi raises the issue of open access – that is the increasing demand for research to be made freely available online.

‘RELX is placed in the centre of a transforming academic publishing industry with customers increasingly rejecting traditional charging structures and demanding more open access publishing.

‘As a result, the company’s academic publishing division has been the main drag on organic growth and, given its rich margins and 40% contribution to the operating profits, it has been subduing profits growth too.

‘Despite these developments and earlier concerns regarding cash strapped librarian clients and lost businesses, underlying growth seems to have picked up slightly since the first half results (from +3% to +4%).’

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Issue Date: 13 Feb 2020