News release
25 July 2019
INTERIM RESULTS FOR THE SIX MONTHS TO 30 JUNE 2019
RELX, the global provider of information-based analytics and decision tools, reports continued underlying growth
in revenue, operating profit and earnings in the first half of 2019, and reaffirms the full year outlook.
Highlights Ø Revenue £3,888m +6%, underlying growth +3% Ø Adjusted operating profit £1,240m +8%, underlying growth +4% Ø Adjusted EPS 45.9p +12%, constant currency growth +8% Ø Reported operating profit £1,048m +8% Ø Reported EPS 39.9p +17% Ø Interim dividend 13.6p +10% Ø Strong financial position and cash flow, net debt/EBITDA 2.6x (2.3x excluding leases and pensions) Ø Completed 8 acquisitions for a total consideration of £246m Ø £400m of share buybacks completed in H1, further £200m to be deployed in H2 Outlook Ø The full year outlook is unchanged. As we enter the second half of 2019 key business trends for the full year are in line with the full year 2018. We remain confident that, by continuing to execute on our strategy, we will deliver another year of underlying growth in revenue and in adjusted operating profit, together with growth in adjusted earnings per share on a constant currency basis in 2019 |
Commenting on the results, Sir Anthony Habgood, Chairman, said:
"Our continued positive overall development was reflected in strong first half earnings. Adjusted earnings per share grew +12% in sterling, +8% at constant currencies, and we have announced an increase in the interim dividend of +10%."
Chief Executive Officer, Erik Engstrom, commented:
"RELX continued to make good progress in the first half of 2019, with underlying revenue and adjusted operating profit growth across all four business areas, and recent acquisitions performing well. As we enter the second half of 2019 key business trends for the full year are in line with the full year 2018."
"Our number one strategic priority is unchanged: the organic development of increasingly sophisticated information-based analytics and decision tools that deliver enhanced value to our customers, supplemented by selective acquisitions of targeted data, analytics and exhibition assets that support our organic growth strategies."
FINANCIAL RESULTS
Revenue £3,888m (£3,653m) +6%; underlying growth +3%: The underlying growth rate reflects good growth in electronic and face-to-face revenues (92% of the total), and the further development of our analytics and decision tools, partially offset by continued print revenue declines.
Adjusted operating profit £1,240m (£1,149m) +8%; underlying growth +4%: Growth was driven by revenue growth and continued operating process innovation.
Reported operating profit £1,048m (£969m) +8%: Reported operating profit includes amortisation of acquired intangible assets of £147m and acquisition-related costs of £38m.
Interest and tax: Adjusted net interest expense was £97m (£95m), and adjusted tax was £248m (£234m). The adjusted effective tax rate was 21.7%, in line with full year 2018. Reported net interest was £103m (£100m), and reported tax was £223m (£192m).
Adjusted EPS 45.9p (41.1p) +12%, constant currency growth +8%
Reported EPS 39.9p (34.1p) +17%: Reported EPS includes gains on disposals and other non-operating items of £57m.
Dividend: We have announced an interim dividend of 13.6p (12.4p) +10%.
Net debt/EBITDA 2.6x (2.5x) including leases and pensions: Net debt, including leases as per IFRS 16, was £6.6bn (£6.2bn) at 30 June 2019. The increase in the net debt/EBITDA ratio reflects a higher pension deficit compared to 30 June 2018. The adjusted cash flow conversion rate was 94% (93%), with capital expenditure as a percentage of revenues of 4%. Excluding leases and pensions, net debt/EBITDA was 2.3x (2.3x).
Portfolio development: In the first half of 2019 we completed 8 acquisitions of content, data analytics and exhibition assets for a total consideration of £246m, and disposed of 5 assets for a total of £45m.
Share buybacks: We deployed £400m on share buybacks in the first half of 2019, and we intend to deploy a further £200m in the second half, bringing the full year total to the previously announced £600m. Of the £200m second half total, £50m has already been completed since 1 July 2019.
RELX FINANCIAL SUMMARY
|
Six months ended 30 June |
2019
£m |
2018 £m |
Change |
Change at constant currencies |
Underlying growth |
Revenue |
3,888 |
3,653 |
+6% |
+2% |
+3% |
Adjusted operating profit |
1,240 |
1,149 |
+8% |
+4% |
+4% |
Adjusted operating margin |
31.9% |
31.5% |
|
|
|
Reported operating profit |
1,048 |
969 |
+8% |
|
|
Adjusted net interest expense |
(97) |
(95) |
|
|
|
Adjusted profit before tax |
1,143 |
1,054 |
+8% |
+5% |
|
Adjusted tax |
(248) |
(234) |
|
|
|
Non-controlling interests |
- |
(2) |
|
|
|
Adjusted net profit |
895 |
818 |
+9% |
+6% |
|
Reported net profit |
779 |
678 |
+15% |
|
|
Reported net margin |
20.0% |
18.6% |
|
|
|
Adjusted earnings per share |
45.9p |
41.1p |
+12% |
+8% |
|
Reported earnings per share |
39.9p |
34.1p |
+17% |
|
|
Net borrowings |
6,640 |
6,200 |
|
|
|
Ordinary dividend per share |
13.6p |
12.4p |
+10% |
|
|
|
|
| |
|
|
|
|
|
|
RELX uses adjusted and underlying figures as additional performance measures. Adjusted figures primarily exclude the amortisation of acquired intangible assets and other items related to acquisitions and disposals, and the associated deferred tax movements. In 2018 we also excluded exceptional tax credits. Reconciliations between the reported and adjusted figures are set out on page 29. Underlying growth rates are calculated at constant currencies, excluding the results of acquisitions until twelve months after purchase, and excluding the results of disposals and assets held for sale. Underlying revenue growth rates also exclude exhibition cycling, and timing effects. Constant currency growth rates are based on 2018 full-year average and hedge exchange rates.
ENQUIRIES: |
Colin Tennant (Investors) +44 (0)20 7166 5751 |
Paul Abrahams (Media) +44 (0)20 7166 5724 |
Disclaimer regarding forward-looking statements
This Announcement contains forward-looking statements within the meaning of Section 27A of the US Securities Act of 1933, as amended, and Section 21E of the US Securities Exchange Act of 1934, as amended. These statements are subject to risks and uncertainties that could cause actual results or outcomes of RELX PLC (together with its subsidiaries, "RELX", "we" or "our") to differ materially from those expressed in any forward-looking statement. The terms "outlook", "estimate", "project", "plan", "intend", "expect", "should", "will", "believe", "trends" and similar expressions may indicate a forward-looking statement. Important factors that could cause actual results or outcomes to differ materially from estimates or forecasts contained in the forward-looking statements include, among others, current and future economic, political and market forces; changes in law and legal interpretations affecting RELX intellectual property rights and internet communications; regulatory and other changes regarding the collection, transfer or use of third-party content and data; demand for RELX products and services; competitive factors in the industries in which RELX operates; ability to realise the future anticipated benefits of acquisitions; significant failure or interruption of our systems; compromises of our data security systems or other unauthorised access to our databases; legislative, fiscal, tax and regulatory developments and political risks; exchange rate fluctuations; and other risks referenced from time to time in the filings of RELX PLC with the US Securities and Exchange Commission.
RELX is a global provider of information-based analytics and decision tools for professional and business customers. The Group serves customers in more than 180 countries and has offices in about 40 countries. It employs over 30,000 people of whom almost half are in North America. The shares of RELX PLC, the parent company, are traded on the London, Amsterdam and New York stock exchanges using the following ticker symbols: London: REL; Amsterdam: REN; New York: RELX. The market capitalisation is approximately £38bn/€42bn/$47bn.
For more information about RELX, visit www.relx.com.
Click on, or paste the following link into your web browser, to view the associated PDF document.
http://www.rns-pdf.londonstockexchange.com/rns/6385G_1-2019-7-24.pdf
