Informa is leading the FTSE 100 higher as it updates its forecasts

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Informa topped the FTSE 100 leaderboards following upgrades to its 2022 sales and earnings forecasts.

At 588p, the Informa share price was up 6% last Monday.

The company, which operates in the publishing, business intelligence and events industries, has raised its full-year revenue forecast to between £2.3bn and £2.35bn. This is higher than a previous forecast of £2.15 billion to £2.25 billion.

As a result, Informa now leads adjusted operating profit from £490m to £505m. It had previously estimated profits at between £470 million and £490 million.

Underlying revenue up 41%

The Footsie business said underlying revenues are up 41% in the first 10 months of 2022. This compares to a growth of 3% in the same period in 2021.

Informa said it had witnessed “strong outperformance” in live and on-demand events across North America, Europe, the Middle East, Africa and Southeast Asia.

Trading was strong after the end of the Covid-19 lockdowns that plagued the exhibition industry.

Power in the depths

In the B2B Markets Live Events and Digital Services unit, underlying revenue grew 65% between January and October. Informa said “growth was consistent across all specialty markets and all geographies” in 2022.

Excluding China – where coronavirus lockdowns are still in place – group sales for the full year are expected to reach at least 85% of 2019 levels. The company does not expect to include live and on-demand events in its Chinese market in November and December.

Meanwhile, underlying revenue of the Academic Markets division grew 3% in the first 10 months. This was due to “the combination of strong subscription renewals, continued growth in advanced learning and continued expansion in open research,” according to Informa.

“Demand is growing”

Chief executive Stephen A. Carter noted that “[the] Demand from the B2B market is growing in many sectors and in most regions, with the current exception of China, which will deliver increased growth when it reopens.”

Carter also noted that its four-year GAP 2 program “continues to deliver growth and acceleration within both academic and B2B markets.”

Under its second Growth Acceleration Plan (GAP), the company aims to exceed pre-pandemic revenues by 2024 through expansion and greater digitalization.

The Informa chief also said that “our divestment program has been completed ahead of schedule and with returns in excess of target, significantly strengthening our balance sheet and placing Informa in a strong position for continued growth and investment in 2023.”

The company said it expects net debt to be close to zero by 2022. Free cash flow is tipped at over £400 million.

A clear outlook for 2023

Informa said it expects to make further progress next year.

It said that “the operational momentum in both of our businesses, combined with the strength of our positions in North America, has placed us in a strong position for further growth and acceleration in 2023.”

The FTSE 100 company added that it expects incremental growth in China as well.

Informa added that “we are not immune to macroeconomic trends”, noting, however, that “[we] continuously monitor the potential impact of inflation, interest rate hikes, energy costs and other factors that may affect operating costs and overall market activity.”

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