Informa ups UBM cost-cut target as profit rises

25th Jul 2018 08:09

(Sharecast News) - Informa increased its target for cost cuts from the acquisition of UBM as the events organiser reported higher first-half profit and revenue growth ahead of expectations. Adjusted pre-tax profit for the six months to the end of June rose 3.3% to £264.7m, mainly because of acquisition costs.The FTSE 100 company's underlying revenue increased 4.3% to £957.1m. Revenue growth was faster than analysts' 4% average forecast and Informa's target of more than 3.5% for the full year.Informa bought its rival UBM for £3.9bn in June to create the world's biggest organiser of business events. Alongside first-half results the company increased its estimate of cost savings to £75m by the end of 2021 from an earlier target of £60m by the end of 2020. The one-off cost of achieving the savings will increase to £100m from £75m.Stephen Carter, Informa's chief exeutiive, said: "Informa continues to deliver good trading performances, reflecting our combination of international scale, increased depth and breadth in attractive industry verticals and the recent addition of UBM. This puts us firmly on track for another year of growth."Informa said it was on track for £50m of cost savings in 2019 but that cuts would have little impact on profit in 2018. It also reported a squeeze on profitability as the adjusted operating margin narrowed to 30.8% from 31.1%.The company's shares, up 24% since early February, fell 3.8% to 818.6p at 0952 BST.