Revenues at 77.0 million euros, record result for the Group on the first quarter; Adjusted EBITDA at 24.7 million euros, Adjusted EBIT at 20.5 million euros.
RIMINI – The Board of Directors of Italian Exhibition Group S.p.A. (Borsa Italiana S.p.A.: IEG), a listed company at Euronext Milan of Borsa Italiana S.p.A and a leading Italian company in the organization of international trade fair events, today approved its Interim Management Report as at 31 March 2023. IEG Group CEO, Corrado Arturo Peraboni, commented as follows: “In the first quarter 2023 the IEG Group achieved extremely positive results, with record turnover, the comeback to profitability and cash generation. The signs of post-pandemic restart, which made themselves known at the end of 2022, were further reinforced and allowed the Group to recover the turnover of some events that have been postponed in the first quarter 2022, but above all to observe a solid organic growth, together with an expansion of the product portfolio with the first editions of K.EY, after its spin-off from Ecomondo, and My Plant & Garden, at the first edition after its acquisition. We will continue the pursuit of our strategic goals in 2023 by accomplishing our investment and development plans, both domestically and internationally, through strategic partnerships, new acquisitions and expansions of our products, keeping our focus on margin recovery.”
Group Revenues as of 31 March 2023 stood at 77.0 million euros, an increase of 39.0 million euros from 31 March 2022.
The first quarter 2022 was still characterized by a limited operation caused by the resurgence of the Covid-19 pandemic, which forced the postponement or the suspension of some of the Group’s main events, both in organized events and conferences. The recovery of turnover related to the post-Covid restart (‘Restart’ effect) with the scheduling of cancelled, suspended, or reduced events amounted to 14.2 million euros (+37.3%), while the incremental revenue for the biennial nature of some events contributed 0.3 million euros (+0.8%) to the first quarter 2023.
Organic revenue growth in the first quarter was 15.5 million euros (+40.6% compared to first quarter 2022), driven in particular by higher volumes and price effects.
In the first quarter 2023 a contribution to revenues growth was given by the increase of the scope of consolidation of 3.3 million euros (+8.4%), after the inclusion of the affiliate company V Group S.r.l., while the changes in schedule which have led to move up some events from the second and third quarter, contributed to the revenue’s growth of 5.4 million euros (+14.1%).
Revenues from Organized Events, which represented 69% of the Group’s revenues in the first quarter, were 52.8 million euros, an increase of 26.9 million euros compared to first quarter 2022. A standard pre-pandemic schedule of two of the most important events organized by the Group such as ‘Sigep’, ‘Vicenzaoro January’ and ‘T.Gold’ has been restored in the first quarter 2023. The incremental change in turnover represented by the “Restart” effect was 10.4 million euros (+38,5%), while the organic growth of the events was 8.8 million euros, marking +32.6% compared to the previous period.
‘Organized Events’ revenues in the first quarter 2023 benefit from the move up of some events, which were organized in the second and third quarters in 2022, with a contribution to the increase of revenues of 4.2 million euros. It should be noted the organization of the event ‘K.EY’ among the main events moved up in the quarter, at its first edition after the spin-off from ‘Ecomondo’, which has achieved particularly positive results by doubling its volume both in exhibiting terms and visit terms.
The variation in the scope of consolidation, through the inclusion of the event ‘My Plant & Garden’ contributed to the growth of revenues of 3.3 million euros.
Hosted Events recorded revenues of 0.4 million euros, up from the first quarter 2022.
Conferences hold the results from the operation of Rimini Convention Centre and Vicenza Convention Centre (VICC). In the first quarter 2023 a total of 25 conferences were held in the two locations, with revenues of 3.8 million euros, and an incremental change of 2.3 million euros compared to the same period in 2022 (when the amount was 1.5 million euros), thanks to the recovery of the on-site congress events, which were restricted in the first quarter 2022.
Revenues from Related Services in the first quarter 2023 amounted to 19.3 million euros (10.0 million euros at 31 March 2022), with an increase of 9.3 million compared to the same period in the previous financial year, driven by an organic growth of 6.2 million euros, the post-pandemic “Restart” effect contributed to the growth of revenues for 1.5 million euros, while the schedule move up contributed for 1.2 million euros.
Publishing, Sports Events and Other Activities, through the publishing activities carried out for tourism sector (TTG Italia, Turismo d’Italia e HotelMag) and for the gold sector (VO+ e Trendvision), the sports events and other residual revenues, have developed total revenues for 0.7 million euros, with an increase of 0.1 million compared to the first quarter 2022 result.
Operating Costs as of 31 March 2023 amounted to 41.7 million euros (22.5 million euros as of 31 March 2022) with the percentage of turnover decreasing from 59.1% to 54.1%. The recovery in volume allows for a 5.0 percentage point improvement in the percentage of sales despite inflationary increases in material and transportation procurement costs on related services and energy costs.
The Value Added recorded in the period amounted to 35.3 million euros, with an increase of 19.8 million euros compared to the previous period (15.5 million euros). The Value added improves by 5.0 percentage points compared to 31 March 2022, from 40.9% to 45.9% recorded in the first quarter 2023.
Staff Costs amounted to 10.6 million euros in the first quarter 2023, with an increase of 2.1 million euros compared to the first quarter 2022 (+24.4%), The percentage of revenues improves from 22.5% to 13.8% in the first quarter 2023, thanks to the recovery of volumes.
Adjusted Gross Operating Margin (Adjusted EBITDA) amounted to 24.7 million euros in the first quarter 2023, with an increase of 17.7 million compared to the same period of the previous financial year, when it amounted to 7.0 million euros. Adjusted EBITDA Margin at 32.1% of revenues, compared to the same period in 2022, when it was 18.4%. The margin recovery of 13.7 percentage points in the first quarter 2023, was encouraged by the post-pandemic recovery of the volumes (‘Restart’ effect), and by the organic growth, while the increase due the variation of the consolidation scope and the schedule variation was compensated for the higher structural costs.
Adjusted Operating Income (Adjusted EBIT) amounted to 20.5 million euros in the first quarter 2023, up 17.5 million euros compared to the same period of the previous financial year, with a percentage of revenues of 26.6%, compared to the 7.9% of the previous period in 2022.
The Financial Management decrease by 1.2 million euros compared to the first quarter 2022. The change is mainly attributable to the negative spread fair value spread of derivative financial instruments.
Income before taxes amounted to 19.5 million euros, an improvement of 16.2 million euros compared to the same period of the previous financial year.
Income taxes amounted to 5.6 million euros, with a tax rate of 28.6%. The Group’s Period Result amounted to 14.0 million euros, an increase of 12.2 million compared to 31 March 2022.
Net Invested Capital, at 199.1 million euros (189.5 million euros as of 31 December 2022), shows an increase of 9.6 million euros, of which 14.2 million euros as incremental change on Net Working Capital and 4.2 million euros as decrease in in fixed assets.
Fixed Capital (249.4 million euros as of 31 March 2023) marks an overall decrease of 4.2 million euros mainly attributable to the amortization of the period of 4.0 million euros and to the release of deferred tax asset of 3.0 million euros on past tax losses, partially offset by the recognition of goodwill for 2.2 million euros related to the acquisition of two events in Singapore through the participated company IEG Asia.
Negative Net Working Capital amounted to 43.0 million euros as of 31 March 2023, shows a decrease of 14.2 million euros compared to 31 December 2022, when it amounted to 57.2 million euros, mainly attributable to the release of prepayments accounted at the end of 2022 against advances from customers for the events held in the first quarter 2023.
The Group’s Net Financial Position as of 31 March 2023 was 91.3 million euros, an improvement of 4.1 million euros compared to 31 December 2022, thanks to an operating cash generation of 6.7 million euros.
Vicky is the co-founder of TravelDailyNews Media Network where she is the Editor-in Chief. She is also responsible for the daily operation and the financial policy. She holds a Bachelor's degree in Tourism Business Administration from the Technical University of Athens and a Master in Business Administration (MBA) from the University of Wales.
She has many years of both academic and industrial experience within the travel industry. She has written/edited numerous articles in various tourism magazines.