Stephen A. Carter, Group Chief Executive, said: “The Informa Group continues with its stated strategy of Measured Change, during a period of operational and management transition. Today we are providing more detail on the 2014-2017 Growth Acceleration Plan, including the opportunities it presents for each of our Divisions, investment planning and our Dividend commitment over the duration of the programme.”
Informa also reaffirmed the current trading update from its recent Nine-Month Interim Management Statement, in which the Group reported a consistent performance through the third quarter, and remains on track to meet full-year expectations.
Divisional implications of the 2014-2017 Growth Acceleration Plan (GAP)
At today’s Investor Briefing, the Group will provide an update on the Growth Acceleration Plan, including the investment programme, first unveiled in July, aimed at accelerating growth and improving returns. This will see up to £90m invested across all four Operating Divisions and in Global Support functions over the next three years.
Management will also outline the implications and opportunities created by the Growth Acceleration Plan in each Operating Division, as outlined below.
Academic Publishing: Academic Strength
* Expand customer base geographically and by segment
* Grow content volume and improve discoverability
* Grow Medical Journals – Academic and Commercial markets
Business Intelligence: Strengthen & Grow
* Simplify, focus and reorganise around priority verticals
* Improve customer engagement
* Transition from information and news to intelligence and insight
Global Exhibitions: Balance & Scale
* Develop digital content-based marketing model
* Drive international diversification
* Establish leadership in priority verticals
Knowledge & Networking: Refresh & Refocus
* Simplify, focus and organise around core hubs
* Develop e-commerce and digital marketing capabilities
* Build community engagement model
GAP Funding
As part of the Growth Acceleration Plan, the Group has been reviewing its sources of funding, to ensure it has a robust financing framework for the duration of the programme. One aspect of this was recently concluded with the refinancing of its Revolving Credit Facility. This facility has been increased to £900m, up from £625m, maturing in October 2019 at an interest rate of Libor +0.6 to 1.2%. In combination with the Group’s US Private Placement Notes, this provides attractive, long-term debt financing. Informa's debt covenants will remain unchanged.
2014-2017 Dividend Commitment
Following the announcement in July of the new Group Operating Structure and the investment element of the Growth Acceleration Plan, the Board undertook a review of the Group’s Dividend Policy. It concluded that the consistent performance of Informa from its balanced portfolio of assets generated sufficient returns to fund the investment programme alongside an ongoing, strong commitment to dividends. The Board intends to increase the Dividends Per Share (2013: 18.9p) by a minimum of 2% per annum, commencing in 2014 and running through the course of the investment period of the Growth Acceleration Plan. This broadly equates to a minimum, inflationary increase in dividends during the period of investment designed to accelerate growth and improve shareholder returns.
