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UPDATE 1-ITE Group profit jumps, says confident of FY outcome
May 19, 2014 / 8:41 AM / 3 years ago

UPDATE 1-ITE Group profit jumps, says confident of FY outcome

(Adds details on Russia, Ukraine, analyst comment, share movement)

May 19 (Reuters) - Exhibitions organiser ITE Group Plc said first-half headline pretax profit rose 64 percent, driven by income from its recently acquired Chinese exhibition Sinostar and changes in the biennial pattern and timing of events.

The company, which organises over 230 exhibitions and conferences each year, said headline pretax profit rose to 18.2 million pounds ($30.6 million) for the six months ended March 31, from 11.1 million pounds a year earlier.

Revenue rose 2.5 percent to 71.2 million pounds.

However, the company said it expected lower level of growth in its key Russian market and Ukraine for the rest of the year due to the continuing political uncertainty in the region.

ITE, which received 45 percent of its revenue from Russia in 2013, expects full-year profit from its Ukraine operations to be around 2.5 million lower than usual.

ITE said the Ukraine business, which will represent less than 5 percent of its profit this year, has run its normal programme in Kiev, albeit with fewer exhibitors and visitors.

Volume sales in Russia over the first six months were up 9 percent, driven by two biennial events - the printing exhibition, Polygraphinter, and the woodworking machinery event, Woodex.

"ITE is a strong event operator with a good track record of managing Russia volatility, though Ukraine/Russia FY15 estimates escalation risks remain the key threat and ultimately whether potential sanctions push Russia into recession," Investec analyst Steve Liechti wrote in a note to clients.

The company said it was monitoring carefully any developments and their implications for its business but with good visibility on current year bookings, it was confident in the full-year outcome.

The company said it saw growth in Moscow and the Central Asian markets in the first half but suffered challenging conditions in regional Russia, Ukraine and the United Kingdom.

ITE said it had booked revenue for the current financial year of 158 million pounds as of May 16, lower than 174 million pounds a year earlier.

ITE organised 136 events in the first half, clocking a marginal 1 percent rise in like-for-like revenue.

Volume sales for the first six months in Central Asia and the Caucasus were 23 percent higher.

Shares in the company were trading up 1.2 percent at 221.7 pence at 0819 GMT on Monday on the London Stock Exchange. ($1 = 0.5942 British Pounds) (Reporting by Noor Zainab Hussain in Bangalore; Editing by Gopakumar Warrier)

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