NEC Group in profit despite struggling exhibitions and live music
THE NEC Group has announced a mixed set of results reflecting the struggling exhibition and live music industries.
The group said today that for the year to March 31, 2012 it had made an operating profit of £16.9m – ahead of expectations – but admitted that individual businesses within the group had all struggled.
The group’s exhibition business, based at The NEC in Solihull, individually delivered a profit of £27.5m, down £10.1m (27.0%) on the previous year. However, the group said this decline was anticipated as it was due to the regular pattern of trade exhibitions, whereby not all shows are scheduled to take place every year.
Despite the figures, the group said the exhibition business had traded ahead of budget expectations as the recovery in the average amount of space taken by firms at trade exhibitions continued.
The Arenas and Ticket Factory business delivered an operating profit of £3.7m, down £1.5m (29%) on the previous year. The group said this reflected the depressed state of the touring music market in the UK during 2011 and early 2012.
On a brighter note, it said firm artist bookings and other prospects were now much more positive and it predicted a strong increase in numbers of live music concerts for the current financial year.
Group Convention Centres, which incorporates the trading results for the International Convention Centre (ICC) together with fees earned from the contract to provide management services to the Dublin Convention Centre, reported a £0.7m (4%) increase in revenue to £17.6m. However, operating profit fell marginally by £0.3m (7%) due to the impact of higher energy and property costs.
John Hornby, left, The NEC Group’s chief operating officer, said: “Overall, we delivered a financial result that was marginally ahead of our budget expectations. We are pleased with that result, given the extent of the macro-economic headwinds we and our customers faced during the year.
“The exhibition business delivered a strong result taking into account the regular exhibition pattern which meant that a number of large trade shows were not scheduled to take place in the year. And our conferences division was able to deliver further revenue growth in what remains a fragile and very competitive market.
“Our arenas, like many large UK, Continental Europe and US venues, suffered from a fall in the number of major music artists touring, and this also affected our ticketing business. The consequence was a disappointing result in those areas which fell short of our budget expectations. However, levels of bookings mean that we are once again looking forward to a year in which both of our arenas are very busy with music artists from across a wide range of genres. This will supplement the comedy, family entertainment and sporting programmes which remained strong during the last financial year and show every sign of doing so in the forthcoming year.”
