Hyve 'cautiously optimistic' as lockdown restrictions ease
Global lockdown restrictions caused interim revenues to tumble at Hyve Group, but the events specialist said it remained ‘cautiously optimistic’ for the rest of 2021 as the sector began to reopen.
Revenues for the six months to 31 March were £10.4m, down from £90.6m a year previously. The gross loss was £3.2m compared to a profit of £31.3m in 2020.
However, headline pre-tax profits improved to £27.6m from £19.4m, bolstered by insurance proceeds totalling £49.0m for cancelled events.
Adjusted net debt was £92.4m, compared to £157.2m in 2020. Hyve attributed the reduction to ongoing cost control measures along with last year’s rights issue, which raised £126.6m.
Hyve conceded that its events schedule continued to be disrupted by both restrictions on international travel and lockdown measures in certain markets.
But it added: “While the near-term outlook remains fluid, Hyve is cautiously optimistic as it continues to see strong pent-up demand for its market-leading events through continued strong rollover of customer deposits and sales.
“Hyve expects a gradual return of customer participation as international travel resumes and restrictions are lifted.”
Mark Shashoua, chief executive, said: “Hyve is focused on emerging from the pandemic a stronger business, with a robust financial platform and strategy in place to meet pent-up demand while accelerating our omnichannel offering.
"Since the outbreak of Covid-19, we have secured insurance proceeds totalling £89.4m, achieved cost savings above our projections and ensured we have sufficient liquidity to make the most of the opportunity in front of us as markets being to reopen."
The firm, formerly ITE Group, ran 12 in-person events during the first half in Russia, Ukraine, China, Turkey and India. It also acquired digital events firm Retail Meetup in December for £18.8m.
Numis, which has a ‘buy’ rating, said: “Strong cost/cash control plus insurance hedge suggest Hyve is a nice option on event recovery, while the recent Retail Meetup acquisition boosts its omnichannel offering.”
Peel Hunt increased its recommendation to ‘add’ from ‘hold’ following the interims. It said: “We do not change our underlying forecasts today but increase the level of insurance receipts expected by £15m. Pre-tax profits should rise to £17.6m from £4.1m but full-year 2022 reduces to £12.8m from £19.8m. Given the share price weakness of recent weeks, we upgrade to ‘add’ on an unchanged target price of 140p.”
As at 1100 BST, shares in Hyve were flat at 117.27p.