Investors shrugged off a slump in first half profit at media group Euromoney Institutional Investor (ERM) to focus on strong subscription growth and a positive outlook.
The shares were up 4.6% to 999p on the results. For the six months ended 31 March 2021, pre-tax profit fell 53% to £17.5 million as revenue slipped 17% to £155.5 million, with the company’s events business disrupted by the pandemic.
‘73% of group revenue during the half was generated from subscriptions, which grew by 6% on a reported basis,’ the company said.
A key part of Euromoney’s strategy in recent years has been to focus on the data side of the business where the company enjoys strong barriers to entry and benefits from recurring revenue.
TURNAROUND ‘AHEAD OF PLAN’
‘Within asset management, the turnaround of the investment research division is progressing well and is ahead of plan,’ it added.
Events revenue, which accounted for 17% of group revenue during the half, declined by 60%. The company declared a first half dividend of 5.7p per share.
Looking ahead, events revenue in the second half 2021 was expected to be about £40 million, assuming physical events return.
Numis analyst Steve Liechti commented: ‘We see a low valuation, well invested high quality data/subscription income, a strong balance sheet, plus event and asset management recovery and optionality.’
