Company Announcements

5 October 2022

Hyve Group plc

("Hyve" or the "Group")

Pre-close FY22 trading update and Turkey disposal

Full revenue recovery in H2 and strong trading trajectory going into FY23

Hyve Group plc, the next-generation global events business, today announces a trading update for the year ended 30 September 2022, prior to entering its close period ahead of its preliminary results announcement.

The Group has delivered revenue for FY22 of approximately £122m (2021: £22m), after excluding revenues from discontinued operations in respect of Russia, Ukraine and Turkey, having successfully run a full schedule of events outside China in FY22. This represents more than 85% recovery on a pro-forma basis[1] when compared to FY19, or more than 90% excluding China where there remains considerable disruption to event schedules.

The speed of recovery has surpassed expectations and combined with strong like-for-like customer spend demonstrates that the demand for high-quality market leading events continues to grow. This has resulted in another year of headline profitability with less reliance on insurance proceeds, which have reduced to £19m (2021: £65m), and a return to positive headline EBITDA without insurance proceeds.

Many in-person events already outperforming their pre-COVID editions

The pace of in-person event recovery accelerated throughout FY22. Despite disruption caused by the Omicron variant in the first half of the year, revenue recovery compared to FY19 pro-forma revenues¹ was still approximately 75% in H1. This increased in the second half to approximately 100%, even without the Group's events in China in the final quarter of the financial year which did not take place due to COVID related restrictions.

In September, two of the Group's largest events, Autumn Fair (UK) and Groceryshop (USA), took place and both significantly outperformed their previous editions. Groceryshop performed especially well, reporting revenues more than 40% higher than its largest pre-COVID edition and attracting more than 3,000 attendees.

Expansion of omnichannel portfolio

During the financial year the Group made significant progress in the continued development of its omnichannel strategy, including the rollout of further tech-enabled meetings programmes at in-person events, as well as the delivery of several successful fully online programmes.

In addition, the strategic acquisitions of 121 Group and Fintech Meetup expanded the size and diversity of Hyve's omnichannel products.

The Group ran 14 tech-enabled programmes in FY22, compared with four in FY21. These include a combination of digitally powered meeting programmes at in-person events and fully online experiences.

£135m debt refinancing and year-end net debt at lower end of guidance

As announced on 3 October 2022, the Group has signed new debt facilities totalling £135m, comprising a £115m term loan and a £20m super senior revolving credit facility ('SSRCF'). The new debt facilities will replace the Group's previous debt facilities, with the £101m debt at 30 September 2022 to be repaid in full on 20 October 2022 when the new funds are to be drawn.

As of 30 September 2022, the Group's adjusted net debt^[2] was approximately £72m, which is at the lower end of the previously stated FY22 year-end guidance of £70m-£90m following strong trading performance and cash generation.

Disposal of Turkish Business in line with the Group's strategy

The Group has continued to streamline its portfolio, in line with its strategy to focus on market leading events in advanced economies, and has entered into an agreement to sell Hyve Fuarcılık Anonim Şirketi and its subsidiaries (the "Turkish Business") for consideration of up to £8m to ICA (JV) Limited.

The Group will receive consideration of £2m on completion, less customary working capital adjustments, and between £4m and £6m of deferred consideration, payable over the six year period until December 2028 based on the profitability of the Turkish Business.

The Turkish Business operates five events in Turkey and for the year ended 30 September 2021 reported a loss before tax of £0.7m. As of 30 September 2021, the Turkish Business had gross assets of £1.9m.

The Directors intend to use the proceeds to reduce the Group's net debt. Completion of the disposal is conditional on completion of the Group's refinancing announced on 3 October 2022.

The disposal of the Turkish Business, following the management buyout of Ukraine announced on 17 July 2022, completes the disposal in full of the Group's Eastern & Southern Europe division. Added to the exits from Russia and Indonesia earlier in the year, the Group has significantly reduced its exposure to more volatile countries and FX rate fluctuations.

The Group's operations are now more concentrated in advanced economies and its US presence has significantly increased compared to previous years. Approximately 30% of the Group's revenues are now generated in the US and therefore the recent strengthening of the dollar against sterling is expected to have a positive impact on the Group's results in FY23.

Strong forward bookings and growth in customer spend give confidence in the outlook for FY23

Positive trading momentum continues as the Group starts FY23, with forward bookings of approximately £68m giving confidence in the year ahead. This compares to £50m this time last year going into FY22[3], which included significant rollovers from events cancelled in FY21. The continuous improvement in trading performance is a testament to the Group's high-quality market leading events enhanced by the successful roll-out of the omnichannel strategy across the portfolio, despite challenges across the wider economic and geopolitical environment.

Uncertainty around running events in China remains, but the Group notes relaxation of the COVID-19 related rules on a region-by-region basis and currently plans to run a full schedule of events in China in FY23. China represents less than 10% of Group revenues.

Mark Shashoua, CEO of Hyve Group plc said:

"It is clear that our business has now almost fully recovered from the turbulence of the last two years, and in many cases, we are pleased to have delivered significant growth compared to pre-COVID performance.

"The continued growth of customer like-for-like spend reinforces our strategy of focusing on only market leading events as customers are clearly directing marketing budgets towards key events in their sectors.

In terms of our geographical focus, we continued to concentrate our capital on high growth industries in advanced economies. The sale of the Turkish Business announced today is another milestone in this direction. We are pleased to have found the right buyer who can offer the necessary investment and support to the team, along with regional expertise. I would like to thank all of the people in the Turkish Business and wish them the best in all of their future success."

"Looking ahead, we must of course remain vigilant/mindful of macroeconomic challenges, however we are optimistic about the next 12 months and this optimism is underpinned by strong forward bookings and an increase in like-for-like customer spend. We enter FY23 with a de-risked and concentrated portfolio of market leading events, clear opportunities for continued growth - both through analogue and digital - and our ever-present commitment and energy to make those a reality."

The Group will be publishing its preliminary results for FY22 on 13^th December 2022.

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About Hyve Group plc

Hyve Group plc is a next-generation global events business whose purpose is to bring together and connect entire sector ecosystems from all corners of the globe. We meet our customer needs to learn, network and trade via both market-leading in-person and online events. Hyve Group plc is all about globally consistent best practice and unrivalled quality. Our vision is to create the world's leading portfolio of content-driven, must-attend events delivering an outstanding experience and ROI for our customers. Hyve's market-leading portfolio of global brands includes: Shoptalk, Spring Fair, Bett, Mining Indaba and the recently acquired Fintech Meetup, which is defining the future of events for the fintech ecosystem and uses state-of-the-art technology to power its world renowned meetings programme.

Where business is personal, where meetings move markets and where today's leaders inspire tomorrow's.