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Commercial

The Commercial division, which represents 35% of Informa’s revenue, increased revenue by 7% on a reported basis to £396.3m and by 12% on a pro forma basis. Growth on reported numbers was lower than pro forma due to the £39m aggregate impact from the absence of the quadrennial IPEX print show exhibition which was held in 2006 and the changed relationship for the 3GSM World Congress under which profits rather than revenues are now shared with the trade association. This arrangement lasts until end of 2009. The impact of this change is to reduce turnover by £18m and has a small impact on adjusted operating profit. The IPEX event in 2006 contributed £21m of turnover and £7.7m of operating profit. The 3GSM and IPEX reductions are offset by £30.3m of Datamonitor revenue and £9.1m of adjusted operating profit.

Adjusted operating profit for the division rose by 22% on a reported basis and by 28%+ on a pro forma basis to £80.1m. A pleasingly 2.5 percentage point margin increase to 20% reflects the good gearing of this division.

With the acquisition of Datamonitor, the successful launch of the Informa Telecoms and Media Intelligence Centre and the growth of Maritime & Commodities highly successful Maritime Intelligence Unit, the mix of revenues in this division has shifted. In 2007 the very resilient subscription revenues grew by 78% to £53.6m.

Regional Events which represented 63% of the division’s revenue in 2007 achieved 12% pro forma revenue growth and 27% pro forma adjusted operating profit growth. Reported revenue growth of 4% was lower due to the impact of the weaker US dollar. Adjusted operating profit growth at 10% despite this dollar weakness again demonstrates the ability of Informa’s events business to scale the costs within the business and increase margin. The adjusted operating profit margin in 2007 increased to 18.5%.

Commercial

Revenue by Type	% of total revenue
Events	76%
Copy Sales	5%
Advertising	5%
Subscriptions	14%

The powerhouse within the Regional Events unit in 2007 was again the Dubai events business, contributing 21% of revenues and over 35% of adjusted operating profits and growing revenues by 38% year on year.

This growth was primarily driven by successfully leveraging brand strength. Existing shows increased square metres with a 60% profit drop through. This enabled equally profitable growth in sponsorship revenue and yields.

Geo-cloning event brands created a safe new launch vehicle, taking sponsors and exhibitors to new markets. Dubai’s most successful 2007 launch was the geo-cloned Cityscape Abu Dhabi which contributed a multi-million dollar gross profit at an above average margin.

The German and Dutch conference businesses which between them represent around a third of both revenue and adjusted operating profit of the Regional Event’s portfolio built on their strong start to the year to finish well with double digit pro forma adjusted operating profit growth.

The remaining smaller regional events businesses which include for example Australia, Brazil, Czech Republic, Denmark, Hungary, India, Italy, Mexico, Poland, Portugal, Singapore, Spain and Sweden, saw a focus on best practice programme development, marketing KPIs, cost control and productivity pay off. The developing markets of South Africa and Singapore had particularly strong year on year conference growth. Denmark, which had a weak start to the year, executed an exceptional turnaround programme and finished the year substantially ahead of 2006. Launch investments in 2007 in Mexico and India are expected to contribute to further good growth in 2008.

Informa Telecoms & Media (ITM) as a market facing unit combines publishing and events revenues. Following the Datamonitor acquisition it now includes the Datamonitor Ovum branded Knowledge Centre. In 2007 ITM contributed 19% of revenue and 29% of adjusted operating profit of the division, and 6.6% and 8.9% respectively of Informa’s total revenue and adjusted operating profit. In 2007 ITM grew reported revenue by 14% and adjusted operating profit by 44% with the loss of revenue from the change in the relationship with the telecoms trade association over the 3GSM World Congress offset by both a rigorous focus on cost control and the benefit of the Datamonitor acquisition.

ITM grew pro forma revenue by 17% and pro forma adjusted operating profit by 23% increasing an already strong adjusted operating margin by over six percentage points to a subscription quality of earnings level of 31%.

ITM’s wholly owned GSM world series, branded as the Com series of events is growing strongly and the training business continues to roll out its successful MiniMBA series as well as to make strong inroads into the corporate training market. In Asia, ITM’s focus on growing its largest events, has also produced good adjusted operating profit growth.

Maritime and Commodities which contributes 18% of the Commercial division’s and 6.3% of Informa’s revenue, saw 9% reported and 8% pro forma revenue increases translate well into 42% and 38% respectively adjusted operating profit increases. A strong focus on driving subscription revenues in this market facing unit which includes events, advertising, copy sales and subscriptions, has increased the latter to 42% of the unit’s revenue. Adjusted operating profit margins have consequently risen by 3 percentage points.

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