NEC Group excited by future after unveiling first figures since £307m sale
THE NEC Group has said its performance in the current financial year will be “even more impressive” after announcing a 15% improvement in its underlying profits.
The business, which operates the NEC, ICC, Genting Arena, Barclaycard Arena and the Vox Conference Centre, was bought by LDC from Birmingham City Council last year for £307m.
The deal completed on May 1, 2015, which meant it was in private ownership for 11 of the 12 months of its 2016 financial year.
NEC Group chief executive Paul Thandi said: “We have a clear strategy and the management team is making great progress in delivering against that strategy, having embraced very positively the change in ownership.
“We have excellent visibility of future trading due to the profile of forward bookings for events and we will continue to invest in and move all of our businesses forward, maximising the opportunities presented by High Speed Two and the significant investment in and around our Solihull site that will bring.”
The group increased underlying revenues by 5% to £133.8m in the year to March. The figures were boosted by revenues from the Vox Conference Centre and rentals from Resorts World Birmingham, which opened last October.
Underlying EBITDA – earnings before interest, tax, depreciation and amortisation, a measure of profitability – increased by £4.2m to £31.8m. The group said this would have been 26% but for the effect of the regular cycle of non-annual exhibitions.
Mr Thandi added: “This is a strong set of maiden financial results for the group under private-sector ownership, and it’s very pleasing to see Resorts World make a financial contribution after considerable planning internally and with Genting UK.
“We continue to invest in our venues to improve our customers’ experience and within Resorts World, our new conference centre, the Vox, has been well received and is trading ahead of our expectations.”
The group invested £16.6m in capital expenditure, including £6.2m in the completion of the Vox.
The statutory figures for the NEC Group showed a £207.5m pre-tax loss, mostly due to excpetional, accelerated depreciation of £227.8m related to the technical handling of the value of its assets. Its accounts were also affected, by a much smaller extent, by “certain one-off transactions relating to the restructuring required to complete the acquisition from Birmingham City Council”.
