ITE ‘resilient’ as Russia business stabilises

London-based international conference and event organiser,
ITE Group, says its business in Russia “has now stabilised” after a
difficult first half which saw pre-tax profits fall 3.9% to £17.5m.

The company, which organises over 240 conferences and
exhibitions a year, had been hit by a challenging trading environment in Russia
and the Ukraine, its largest markets. In its latest interim report, the company
says volumes in Russia dropped 16% as a result of the economic slowdown and the
absence of two biennial events.

The group now says the trading environment in Russia has
stabilised and that it has maintained its gross profit margin on events by
reducing costs.

Ukraine, however, continues to be severely impacted by
political issues but accounts only for 2% of ITE profits in this financial year
(3% in 2014).

Overall, the company is reporting revenues down 21.2% to
£56.1m from £71.2m, with net debt rising from £1.8m to £56.1m, largely due to
the purchase of Eurasia Rail in Turkey, Africa Oil Week in South Africa and
Breakbulk’s series of events.

The acquisitions should also help diversify the
international portfolio of events.

The interim statement says overall volume sales from the
group’s UK fashion portfolio were similar to last year. In London, good growth
at the premier menswear and childrenswear events were offset by temporary
unavailability of venue capacity this year for the womenswear event Scoop. In
Birmingham, MODA, the largest event in the portfolio, was slightly ahead of the
prior year selling 16,700 sqm (2014: 16,500).

The group’s March acquisition of a 50.1% stake in Africa Oil
Week (AOW) for £16m, part financed by a £12m placing of shares, establishes a
first-time presence for ITE in Africa, and provides the group with a base from
which to grow its portfolio of events across the continent.

ITE claims its acquisitions have been successfully
integrated and operating performances are in line with initial expectations.
The board has maintained an interim dividend of 2.5p per share (2014: 2.5p per
share). 

ITE CEO Russell Taylor (pictured) says: “ITE has delivered a
good first half performance despite a challenging trading environment in the
group’s largest market. The recent acquisitions of Eurasia Rail in Turkey, Africa
Oil Week
in South Africa and Breakbulk’s series of events have helped to
diversify the group’s presence outside Russia, and our businesses in Asia and
Turkey continue to perform well. 

“Looking forward, the trading environment in Russia has now
stabilised. ITE remains in a strong financial position and we continue to
seek opportunities to expand the business. The group enters the second half
with good visibility on current year bookings and the board has confidence in
the full year outcome.”

Do you have news for CN? Email: Paul Colston

Paul Colston

Author

Paul Colston

Managing Editor, Conference News & Conference & Meetings World.

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