Earnings Transcript for INF.L - Q4 Fiscal Year 2020

Stephen Carter: Good morning, and thank you very much for taking the time to join us here at the Informa 2020 Annual Results. I'm joined by Gareth Wright, our Group Finance Director. And Gareth and I are just going to take you through the results themselves for 2020. And then perhaps as importantly or more importantly, talk a little bit about our guidance for the remainder of this year, 2021 and also look forward to what we see as a period of growth and revitalization going out to 2024. We've seen this presentation continuing stability in security because our business has, as you know, been very impacted by the COVID-19 pandemic. But we feel very confident about where the business is and indeed, how we've navigated our way through the challenges, not just of last year, but also this year, what we are treating as a transition year as we move back to growth and recovery and then future revitalization. The disclaimer stands as normal, and now we'll get into the meat of the presentation. We've talked for many years about Informa servicing or being part of the knowledge and information economy. And there has never been a period like last year where the power of data of information of connectivity, of the ability to work remotely, to be dependent upon accurate data, original insights, verified intelligence has never been more vivid than over the last 12 to 14 months. That economy is a growth market in every sense. We obviously operate in the B2B aspect of that market, providing market specialist information, knowledge and service to our customers in our many markets. Looking into 2021, what are the key messages or the key thoughts we'd like to leave you with, and then Gareth and I will work through the detail of this. We spent a lot of time at the beginning of last year when it became very evident to us that this COVID pandemic was going to be a material consequence, not just for our business but more importantly for the rest of the world that we would have to move fast to ensure stability and security, not just in our financing, which Gareth will take us through in more detail, but also in our costs and how we dealt with our customers and what it meant for how we built the future strength of the company. We were very focused on ensuring we were making long-term decisions, not just surviving in the present, but more importantly, having long-term value in the future. Our subscriptions businesses moved center stage, and they really have had a very strong 2020 and an even stronger opening to the first quarter of 2021, which we'll talk about. We're seeing 2021 as a transition year. There is a return to physical activity in different parts of the world, most notably in Mainland China, but not only in Mainland China. And we'll give a sense of how we see that unfolding. We have, as a result of the lockdown been engaged in the development of attendant and adjacent digital services alongside our B2B event brands. And that has afforded us a learning opportunity and a development opportunity, a product development opportunity. And we'll give you more of a sense of what that means, not just for the short term as a replacement, but as a long-term part of the product offer alongside our events. Data and customer knowledge, customer insight, customer understanding has become even more important, particularly in a world where you can't meet your customers face-to-face and get that texture, that depth, and the power and the value of the data that powers our business has gone up in its importance, and we'll talk a little bit about that as well. We gave an undertaking at the end of last year, which we reiterated in our pre-close statement in January that we would discipline ourselves to operate within a positive cash envelope in 2021. We set a baseline of revenue certainty for 2021 of around £1.7 billion, which we underscore today. And we also want to talk a little bit about the importance of sustainability and our own Faster Forward program, which has been a big part of our business for some time and is going to become even more important in the years ahead. So that's the snapshot of the group. As everyone knows, we operate in 3 markets, and we remain committed to those 3 markets. The business information market, the provision of specialist data and intelligence, in our case, within that division, 2, 3 end markets, the pharma market, the maritime market and the financial intelligence market with a primary focus on retail financial intelligence. We operate in the B2B market where our events businesses are primarily focus providing products and services to our customers largely to enable them to go-to-market, meet their customers and connect buyers and sellers. And then we operate in the market for advanced learning for verified accurate, peer-reviewed, advanced learning and knowledge. And in all 3 of those markets, we remain confident that the forward attractions of those markets are as they ever were, albeit there is an increasing importance of the power of data information and applied technology, all subjects we will return to. To go back to go forward, here is the headline summary of our 2020 results. Our performance is broadly in line with guidance. We issued unusually for us, a pre-close update in early January in order that the world could get a sense of the stability and security in our outturn from 2020. Today, we're confirming those numbers. Our group revenue is pretty much down the fairway with that pre-close guidance at £1,661 billion. And you can see the gap versus the normalized year that was 2019, a material gap in revenue, almost entirely a function of the COVID-19 pandemic impact on our physical events business. On the profit line, we made a profit in the year and adjusted operating profit of just shy of £270 million, still significantly down on our normalized profit run rate. And alongside that, we moved significantly on our cost base in year. And both on our direct costs and our indirect costs, we, on a full year basis, ended up with nearly £600 million reduction in our standard operating costs. And we'll talk more about that later. We did end up with an operating loss as a result of all of those impacts on our business, largely a judgment on the carrying value of the -- some of the assets in our Events business, and largely a function of a view of the likely profitability in 2020, which you can see and indeed the likely profitability in 2021, which you can see as a result of the transition year. Doesn't change our view of the long, long-term value of those assets, but that is an impairment that we announced in the half year and we confirm in the full year. We did have positive operating cash flow in 2020. There was a cash outflow as a result of the various onerous costs and some of the debt restructuring costs. And as I said earlier, we're committing again to living within our own cash envelope in year. The net consequence of all of that leaves us with a net debt reduced year-on-year, largely a function of the equity raise and the support from shareholders affected in part by some of those cash outflows. I would hope in the main that those financial outcomes are in line with guidance and pre-close disclosure, and they are almost entirely a function of the impact of the COVID-19 pandemic. Just to step into the individual businesses. I'm going to start with our Subscription-led businesses for obvious reasons. They became more center stage in 2020 and remain so in 2021. Informa Intelligence, our business there has been on a march for some time of improvement of portfolio rationalization to focus around the 3 markets where we can see we have a competitive position, a proprietary position and a position we can defend on a going-forward basis. We've seen very strong performance from all of those businesses, but particularly from our Informa Intelligence business. The key, if you like, the anatomy of that business that is important to look at is our renewal rates because that then means that as we drive for new business and new product development, we can take that as growth rather than as replacement. We're, in fact, upgrading our guidance today on the forward growth in that business, partly as a function of having had consecutive quarters now of performance and partly a function of the strength of the business in the opening part of 2021. We'll talk a bit more about that later as well. Similarly, Taylor & Francis . Absent that, slightly tight period in the second quarter of last year where there were campus closures and some supply chain issues, which affected our print books in our reference business, Taylor & Francis had a very strong performance. And our shift towards Open Access, the flexibility in our approach to subscription arrangements with customers and fundamentally, the quality of our content and our archive has really served us extremely well. And similarly, we are confirming that we see this business going back in 2021 to more pre-COVID levels of revenue growth than we actually saw as a matter of fact, it was essentially flat in 2020. So very strong performance, consistent performance and very good forward visibility and an upgrade in guidance for the Intelligence business. There were a series of steps during 2020 that gave us the stability and security that we sought. And we started by taking a position that the important value of our company was in our intellectual property, our assets, and particularly the specialist expertise in and amongst the colleague community. We then focused on the balance sheet because in year 2020, we took the view rightly with hindsight that the balance sheet would be what really mattered. And that required a raft of work around our equity and then around our debt. And at a very specific level, a removal of financial covenants out to the middle of 2023, by which point we feel that we will be comfortably back into growth and forward ambition. We did the work on the cost that Gareth will unpack. It gave us some flexibility to then look at our Events program and shift it out. And then initially, in [indiscernible], we thought that postponement would take us to September of last year. And by and large, that proved to be accurate in Mainland China. But actually, in the rest of the world, we then had to make a follow-on judgment in September that really we had to extend that program, which we did. And we took the view then that extending it to June, late spring to June of 2021 was probably a sensible judgment. By and large, that has proven to be right and we'll give you a deeper indication of the specific geographical timing and phasing of return later on in the presentation. In '21, we're applying a similar approach but doubling down further on our subscription business, seeing the gradual return of physical events and critically, the learning and the experience of 2020 on digital services and on the power and value of data has led us to make some very specific decisions around the technology and service stack on our digital service capabilities in our events business and in how we manage our central database of B2B proprietary, B2B customer information and insights, which I'll return to later on in the presentation. As I say, we're committing to our baseline revenue of £1.7 billion, and that largely is a function of what we can see today in our subscription business performance and the growth they're delivering in our Mainland business in China, in those digital services that we are confident in providing to our B2B Events customers and in our relatively small and discrete portfolio of outdoor events. Is there a possibility that we might nudge above that? We might. And that will be largely determined in the main by the pace and rate of return in North America. And we'll give you more color around that later. How is reopening looking? Well, everyone will have their own data on case counts and on new case counts. And almost every day, we see some spikes in some geographic locations, and there are indeed some parts of the world that are still engaged in very structured lockdown rules and regulations. Our judgment is that the trend lines are in favor of vaccines ahead of the virus. And therefore, you can see in different locations an improving degree of normalized activity, albeit with some new guidance and conventions around what the next normal looks like. For us, as this slide tries to layout, our 3 key markets for our physical products are Mainland China, which for all intents and purposes, domestically is back to pre-COVID performance levels. North America, which is beginning to return on a state-by-state basis and symbolically and substantively we will be returning to Vegas in June with 3 major industrial brands, World of Concrete in the construction market, TISE in the surfaces market and Waste in the waste and industrials market. And then the United Arab Emirates, where we have a big position in Dubai and then across the region. That is a little bit more of a mix of a regional domestic and international meeting point. And so we think the pace of return there might be more phased again. And then Continental Europe, probably at a slower pace of return. We've chosen Italy as an example because we are scheduling an event in Italy, our CPHI event, which many of you will be aware of at the back end of the year, and our expectation is that, that market will be open by that point. So a mixed picture, but broadly a progressive return through '21, teeing us up for more strength participation and performance in '22. This just unpacks it a little bit more, and specifically, it gives you a sense of some of the other markets in the rest of the world, Taiwan, Japan, Thailand, South Korea, Egypt, Turkey. So there are other places in the world where we are trading almost entirely domestically or subregionally. And for the moment, in our guidance and in our judgment, we have removed international revenues from our guidance for this year. In the United States of America, this is a snapshot of where we are today, and it gives you a sense that decisions are being made on a state-by-state basis, and it varies by state, partly for reasons of geography and climate, partly for reasons of how the COVID experience has played out and partly determined by the pace and rate of the vaccine rollout. All of these locations matter to us and they matter to different markets in different ways. But broadly speaking, we are seeing opening as the conversation that we're having in the main. We're in deep collaborative discussion with venues, with state governments, with local governments. We have the benefit of running -- having run nearly 45 to 50 scale events in Mainland China, where we've deployed our all secure operating protocol, which provides a whole range of security obligations on density, on crowd management, on digital registration, on access, on meeting arrangements. And all of that security is part of what is allowing us to bring our product back to life for our customers. Forward bookings in the main look positive. And as is noted in the financial section, the level of refunds from customers who had pre-committed is really remains relatively modest. We thought it might be useful to provide people with a little bit more texture about what is the nature of our brand and product portfolio when you're looking at our Events business because it's an amorphous portfolio if you're looking at it often from the outside. And we've tried to look at this through the lens of what did the COVID experience teach us about our brands and our products. And this gives you a sense of the anatomy of our B2B events portfolio. It indicates a number of things that I think are relevant to both the transition year of '21, but then also the return period that follows on from that. Our business is very weighted towards major brands. Over 90% of our business is in what we would categorize as a power brand in our top 50 or a large-scale market brand. We do still have some very localized brands, but it is a relatively minimal part of our portfolio by revenue. Our balance of participation weights towards domestic participation rather than international participation or domestic and subregional. And in the near term, we believe that, that is where travel patterns will return fastest, and we've certainly seen that China, and we are seeing that in North America. We wait more towards our major locations, North America, Mainland China and the UAE, nearly 60% of our portfolio by revenue is trading in those 3 main geographies. And it significantly weights towards larger brands by revenue, north of $1 million, $2 million, $3 million of annualized revenue on a per brand basis. We believe that shape and architecture gives us quite some confidence that as the market does come back in full in '22, in '23, in '24, actually, it will lean more towards major brands in major trade routes, in major locations with significant footprints of domestic and regional activity. So in summary, we're seeing '21 as a transition year, and we think that's a sensible approach. And it's guiding us to make some decisions in '21, which are more focused on '22 and '23 than necessarily maximizing revenues in '21. And that speaks to pricing, it speaks to ensuring safety and security and confidence in the event experience, our all secure protocol. It speaks to scheduling and whether or not we bunch too many events at the back end of '21 or actually wait and bring them back in full glory in '22 or '23. So that's how we're thinking about '21 as it relates to the scheduling and practicalities of our events portfolio. But alongside that, we're also using it to further embed the skills that we have learned and the products that we've developed in digital services, and we're accelerating the management of our data in our B2B business, and I'll come back and talk about that after Gareth. Looking out from '21 to '22, '23, '24, the period where we had to make that impairment judgment at the half year in 2020, we do see further growth acceleration across the group. We see it in our Intelligence and Subscription business, hence, the revenue upgrade. We see it in our Open Research, our Open Science, our Advanced Learning business, in Taylor & Francis. We see it in the progressive return of physical. We see it in the growth of digital services, probably replacing some of that long tail of smaller events and local market brands that may not be as powerful post-pandemic as they were before. We see continued investment for longer-term growth, and we would see flowing from that. an increase in our profit flow with the same discipline on cash conversion that we've historically seen in our business. And on that note, I'd now like to hand over to Gareth to take you through the 2020 outcome in detail. and how we're thinking about 2021. Gareth?

Gareth Wright: Thank you, Stephen. Good morning, everyone, and thank you for taking the time to join the webinar. I'm going to take you through a couple of slides on the 2020 results to unpick those for you a bit. I think what I will show you is an income statement performance in line with the guidance and expectations for the market, but a cash performance and therefore closing financial position better than we guided to in September. I'm also going to talk you through the actions we've been taking through Q4 2020 and into Q1 2021 to ensure the ongoing stability and security of Informa. So let's start with the income statement. We delivered £1.66 billion of revenue in 2020, which is in the range of the trading update that we gave in the first week of January. And then to tailor 2 cities between a consistent and strong performance from our Subscription businesses and the impact of the COVID-19 pandemic on our physical B2B events businesses. The operating profit of almost £270 million benefited from our cost management program that we introduced during the year, and I'll talk about that in more detail on a later slide. Net interest, net finance costs reduced year-on-year, which is a factor of the equity raise in the first half of the year that reduced average debt levels, but also the fact that we replaced our U.S. private placement borrowings with lower cost EMTN financing. And that produces a weighted average cost of debt of about 3.75% going into 2021, lower than the north of 4% cost of finance in 2020, both those numbers, including IFRS 16 costs. The effective tax rate reduced from 19% to 15%, which is really a function of the fact that our tax deductions or certain of our tax reductions are relatively fixed rate in nature. And therefore, when you have a year of lower profitability as we had in 2020, those deductions become a larger part of the mix overall, and that reduced our effective tax rate to 15%. I think looking forward into 2021, I think we'd assume a higher tax rate as the profitability of the business begins to increase, and therefore, people are thinking about it in the range of 19% again are probably in the right place. Finally, in relation to the 2020 income statement, I think there's 4 kind of headline exceptional costs, exceptional charges that we got to mention. At the half year, we took a noncash goodwill impairment of £593 million to reflect the change in the carrying value of the business following the COVID pandemic. We reassessed that at year-end, and there was no need to take any further charge beyond what we took at the half year. The noncash intangible amortization in the year was about £290 million, a touch lower than 2019, but broadly consistent year-on-year. In the interest line, we included about £155 million charge for the cost of restructuring and rescheduling our U.S. private placement borrowings, which enabled us to finish the year with no financial covenants in place over the group. And then finally, we incurred some COVID-related restructuring costs, which ensured that we finished 2019 -- 2020 with a cost base aligned to the revenue expectations for the start of 2021. So moving on to the divisional analysis, which enables us to unpick the revenue and OP performance in a little bit more detail. And I think the first headline you start with is the strong and resilient performance of the Subscription businesses. Informa Intelligence delivered another good performance despite some disruption from the COVID-19 pandemic. Full year underlying revenue growth was 1.8%, consistent with what we reported at the half year. And all 3 of the businesses Informa, Finance and Maritime performed strongly. The OP margin increases year-on-year, as you can see there, which is from the benefit of disposals that we made in 2019, where we exited some lower-margin businesses. Moving into 2021, we're seeing a combination of good subscription renewals and strong new business sales, and we exited the key renewal season, which kind of finishes in January, February, with a strong performance in our annualized contract value year-on-year. And all that really across the business gives us confidence in increasing the underlying revenue guidance up to 4% plus as we've announced this morning. And this is driven really by the consistent ongoing investment in products, in platforms and the service capability of that division, which is something that we've done for a number of years since the growth acceleration plan and continue to do going forward. And it's really delivering, I'd say, of dividends in terms of the improved performance of that business. Turning to Taylor & Francis. It delivered a good performance across the year, I think, despite some of the difficulties in Q2 in terms of the COVID disruption. In the first half, when we experienced that disruption, our underlying revenue position was a 0.7% decline. But as you can see from the numbers that we've announced this morning, the H2 position has returned to growth and therefore gets us back to essentially a flat revenue position year-on-year. Within those numbers, the improved performance was largely in the books business once we've got out of the Q2 period of disruption to the supply chain and to campuses and to the -- particularly the U.S. retail business. Journals subscription revenues were consistent and strong all through the year. Encouragingly, even with that flat revenue performance, we've been able to report 1.3% increase in underlying profits today. And that's really a function of some -- certainly some short-term cost-saving measures like travel costs that came out as a result of the pandemic, but really underlying it, it's the strong cost control culture and value creation culture in that business. Reported margins were maintained year-on-year. And moving into 2021, we're seeing that the strong digital subscription renewals in the business, the significant growth in the e-books revenues and the continued strong performance of the Open Research journals or other products give us confidence about returning to growth for the full year in 2021 in this business. Informa Markets, Informa Connect and Informa Tech, it's really worth going back to the start of 2020 when actually we started the year trading very well and delivering round about £275 million worth of revenue in the period before the COVID pandemic took effect. After that, as I said, the performance of 2020 is really driven by the impact of the COVID pandemic on our physical B2B events business. In response, we launched the postponement program, pushing events back within 2020 and now back within 2021. We responded with an accelerated program of virtual hybrid events, ultimately delivering over 500 products in the year through those channels. And we responded with our cost-saving program, which is a targeted program focusing on both direct costs and indirect costs in the business, removing over £600 million of costs on a run rate basis in the year. So focusing on our outlook for 2021. I think there's 2 main themes. Firstly, we see 2021 as a transition year, as Stephen spoken to. And really, the performance in the transition year will be dependent on the pace and scale of reopening of B2B physical events, which will vary inherently by region and by end market. Our early decision last September to extend our postponement program through into 2021 to mid- to late spring, early summer, is paying dividends in terms of our ability to schedule events and to get perhaps more permissions to operate in 2021. But secondly, I think it's important to say we remain very confident in the model. We remain very confident in the B2B physical events space, based on the customer feedback receiving, based on the low level of refunds that are being requested, based on customer commitment forward for events in 2021, and based on the desire for the regions and the cities in which we operate our scale events for us to return to the market and to reopen. On the next slide, I'm talking a bit about the sources of revenue in 2020 and how the £1,661 million revenue number builds up for 2020 But I'm also talking with one eye on 2021 and how we -- how the components of our £1.7 billion revenue baseline builds up. So 2020 firstly, as I said on the previous slide, before we closed and before events closed for the pandemic in Q1, we delivered about £275 million of worth of revenue. And we also delivered revenue following the reopening events, and Stephen has mentioned just now, really, that's a conversation about Mainland China, where we delivered more than £150 million worth of revenue across the full year. In Informa Markets, Informa Connect, Informa Tech, there were always media data research and marketing services revenues, and those maintained a consistent level of performance year-on-year. And we added over £100 million worth of virtual events revenue in 2020 from standing up those new revenue streams. And then the balance of the revenue number, £860 million from a combination of Taylor & Francis and Informa Intelligence, gets us to the £1.66 billion outcome that we're reporting today. Turning to 2021. We've committed to a baseline revenue number of £1.7 million. We committed to that in September at the half year, and we're reconfirming that commitment today. And that's a broadly similar number as what we reported for 2020, but actually the component parts of it are quite different. So for example, that £275 million of revenue that we delivered in Q1 2020, that doesn't repeat in exactly the same way in 2021. The baseline assumes that we continue to grow our subscription businesses. Mainland China continues to operate as we're seeing in operating year-to-date in 2021. We continue to operate outdoor events, which is again something that we've done in 2020 and in early 2021. And we continue to grow our digital services, media and virtual events activities through the year. Now clearly, physical events may return more broadly. They may return faster than being envisaged in the £1.7 billion baseline number. And we'll just have to see how that pans out across 2021. In the first incidence, as those physical event revenues return, you may see some switching out of virtual events into the physical revenues as the budget of our customers just changes from 1 area to another. But overall, this is what we're planning to deliver in 2021 as a baseline, and Stephen is going to pick a bit more in his second section, how we're delivering the products and the services that will achieve that. This slide shows the year-on-year movement in OP with the impact of the COVID pandemic on profitability, clearly the largest single dynamic as you'd expect. We offset that impact with a targeted program of -- targeted cost management program, and I'm going to talk about it in a bit more detail on a later slide, but in headline terms, what we've done there is we've rightsized our cost base to the level of activity we're seeing at the start of 2021, which ensures that we can remain cash flow neutral as a minimum in the new year. You should know that within the year, we delivered the £400 million-plus of direct cost savings and £200 million of indirect cost savings on a run rate basis by the end of the year. The actual indirect cost savings in the year were more like £140 million, just so you can understand the mix between 2020 and what to expect in 2021. Within the circa £270 million of OP that we delivered as a good performance from Informa Intelligence, which increased its margins year-on-year and a good performance from Taylor & Francis, which maintained margins year-on-year. The net outcome being that we delivered an adjusted operating profit margin of 16% for the full year. Focusing on cash flow. And again, you can see unsurprisingly, the largest single dynamic in the numbers is the impact of COVID-19 on the business. In response, we launched a series of cash flow initiatives to help deliver financial stability and security for the business by the end of the year. There was a circa £80 million working capital outflow, as you can see there on the slide, which is really a factor of the cancellation and postponement of events in 2020, which meant we weren't taking the same normal level of rebookings for 2021 events. We did collect quite a lot of cash, as I'll show in the next slide overall. Interest cash flow has reduced year-on-year. As I said earlier, that was probably a factor of the equity raise, reducing average net debt and also the lower cost EMT and borrowings. Tax cash flows reduced year-on-year, which is really a factor of the lower profitability of the business in 2020. It's worth noting that CapEx was maintained at consistent levels around about £50 million compared to 2019. But the weighting of that was really more towards Taylor & Francis and Informa Intelligence to support the strong growth we are seeing in those businesses. Overall, the cash flow initiatives generated round about £100 million of free cash flow before the one-off COVID cash flows. And those COVID cash flows, which will restructure the balance sheet, eliminating our financial covenants and to realign the cost base with the activity levels we're expecting in early 2021. And the net of all those delivered a free cash outflow of £150 million for the full year. At the half year, I think we guided to a number more in the range of £230 million to £250 million of free cash outflow. As you can see, we've done better than that in the year, which has really been a factor of a better working capital performance in the second half of the year and then perhaps we were prudently forecasting at the half year. And also there's restructuring costs coming out less than we thought they might do when we guided the market at the half year. On the next slide, we're talking a bit about refunds and the deferred income carried in the balance sheet in relation to our events businesses. And on the previous slide, I mentioned that working capital had a bit of an outflow for these refunds. But I think there's a couple of key things we want to point out from this slide. First of all, despite the fact that the COVID pandemic impacted B2B physical events materially in 2020, you can see from that, there's also a material level of cash was collected in the business, both in terms of 2020 events in places like China, but also forward-looking deposits into 2021. Customers on the whole have chosen to leave their deposits with us. The level of refunds that we've seen in the business overall has been pretty small. And that decision to leave the funds with us, we think is an indication of the strength of the brands and the strength of the market positions that our B2B physical events have. The refunds we did see mainly occurred in Q2 2020 following the initial series of cancellations and postponements of events program. And actually, in a number of specific shows, this was driven actually by our desire to support the SME communities behind those shows and to make sure that they've got the refunds if they needed them to support their financial position. But in the second half of the year, refunds have been running at pretty low levels, and we've seen that maintained into Q1 of 2021 and actually, they have been running at levels lower than the collections we've been taking in the business. Hence why we're finishing 2020 with around about £300 million worth of events deferred revenue in the balance sheet. I talked a couple of times about the targeted cost management program that we launched in the year, and therefore, I think it's worth just giving a little bit more color around that. There's 2 key elements to it. The direct cost savings of £400 million plus and indirect cost savings of £200 million plus. The direct cost savings are all made in areas directly related to the operation of physical and so areas like venue costs, security, marketing and promotion that occurs in the right up to the events. And the key thing about that is those costs will only return when we start to operate face-to-face physical events again. In other words, when we were generating revenue from those events, then the costs will return and not before that. In terms of the indirect cost savings, which were £200 million on a run rate basis and £140 million on an in-year basis, the savings were delivered in a step-by-step way, looking to really minimize the disruption to our colleague community, 1 of our key assets in Informa. And we wanted to make sure that while we save the cost in the indirect cost base, it didn't impact our colleagues. These costs won't restart until we choose them to come back into the business. And that will occur when we can see credible levels of revenue generation and OP generation from the face-to-face events business. So how and when these costs come back into our business are totally under our control. Focusing on the balance sheet, our refinancing work got us to a position of stability and security by the end of 2020. And I'd really like to go on record with my thanks to both the treasury team and the finance team and Informa for all the work they did in 2020 getting us there under what were very difficult operating conditions for everyone, but they did a great job in terms of helping us restructure the balance sheet. The output of this work is that we have no maturities until July 2023. Our work here since we last spoke to you, included a couple of different things. We've extended the maturity of the revolving credit facility by a further year. So it mainly matures in 2024 and 2026 now. Plus we refinanced and canceled the short-term credit facility we put in place in March 2020. We refinanced that with the MTN debt, which has the advantage of being longer term and also having no financial covenants. And I'd like to add I think the strong support for the 2 MTN raises we did during 2020 demonstrates the ongoing commitment of the debt markets to the Informa story. We have substantial liquidity of £1.35 billion at year-end. This includes the RCF, which is -- was fully undrawn at the year-end and remains fully undrawn today. And during Q4, we increased the size of this from £900 million to £1.05 billion by adding a further 3 banks to the syndicate. And also in liquidity, we have £300 million worth of cash on the balance sheet as we continue to run a cash position larger than we would normally do to aid the liquidity position through the period of COVID disruption. And then finally, as I said on the previous slides, we have rightsized the cost base across the second half of 2020 to ensure that it's consistent with the activity levels we're seeing in early 2021. And that ensures that we're cash flow neutral or cash flow positive in the new year, and we can confirm today that we have delivered a cash flow positive result for the first quarter of 2021. So in summary, no maturities into July 2023, no financial covenants, substantial liquidity of £1.35 billion protected by cash generation in the business. And I think all this demonstrates our stability in security and financing through to 2023. I'm going to wrap up with a summary of where we think we stand moving through the 2021 transition year. We're seeing continued strength and actually accelerating growth in our subscription businesses at Taylor & Francis and Informa Intelligence. As Stephen has outlined, we've seen a progressive reopening of face-to-face B2B physical events, and we continue to see that as we go through the year, which alongside the growing range and depth of our B2B digital services, I think leaves us with a confidence around the outlook for Informa Markets, Informa Connect and Informa Tech. We've rightsized the cost base, as I said, to the level of activity in terms of revenue that we're starting in the year in terms of 2021. And we're cash flow positive, which means with no maturities, no covenants and substantial liquidity, we have a strong confidence around our financial position. But within that position, we still are investing for growth, both in terms of OpEx and CapEx to support the growth in Informa Intelligence Taylor & Francis and the return to growth in the other 3 divisions. And that, I think with the performance we're seeing in the business model across the end of 2020 and early 2021, the strength of the businesses, the strength of the brands give us confidence around our performance in 2021 and as we return to recovery and revitalization in 2022 and beyond. I'm now going to pass you back to Stephen, who's going to talk to you through the remaining slides.

Stephen Carter: Thanks, Gareth. Right. Just very briefly before we get into questions, what I'd like to do is just look in with a little bit more depth into some of our businesses, look up into the future and then look out at what we think are some of the opportunities that are available to us. But I'm going to start where we started back in January 2020, when we first felt the full-wave impact of COVID in our business, which initially was in Mainland China. And we made really 2 decisions. One that Gareth has talked about a lot, which was we wanted to move by focusing on the future long-term value of our brands and our business and thereby ensure that we gave ourselves room to breathe, room to maneuver and to maintain our market strength and our customer relationships. And the other was that the heart of our strategy at Informa is specialisms, championing the specialist is our mission statement. And at a practical level, what that really means is across the company in many places, we have thousands of colleagues who in their individual areas are experts, deeply knowledgeable about their customers, their subject area, their research area, their product area. And as it related to colleagues, we also, therefore, wanted to ensure that we minimized negative impact of the COVID pandemic on colleagues. And that led us to a whole series of approaches on flexible working, unlimited volunteering, sabbatical options, salary sacrifice, employee support funds, well-being programs all of which were designed to allow us to move with flexibility and preserve the intellectual capital of the company. And by and large, I think that will prove to have been the most significant decision that we made as a company going into the COVID-19 pandemic. Looking down in a little bit more depth in our Intelligence business. This is, I think, I can say an unqualified success story, but not one that happened overnight. For those watching and listening with longer memories, you may recall that in 2013 and 2014, we were lagging in this market. We had a series of relatively disparate assets and businesses, many of which had come to us through sort of packages of acquisitions. We were in more markets than we're in today. And so we've been through a very systemic program of product investment, of portfolio rationalization, of focus and of improving our product platforms, the user experience for our customers, the speed and responsiveness of our data and the relevance of what it is we do for the customers that we serve. It has taken us time to build a business with the architecture and the capabilities that you need to be a player in the information services market. And we now feel comfortable and confident that in our 3 markets in pharma, intelligence, and financial intelligence with a focus on retail, financial, I'll touch on a bit more. And in Maritime, we really do have a portfolio that is competitive, relevant and has future growth potential. At its heart in these businesses as we worked out, it's the subscription renewal rate, the vote every year by your existing customers as to whether the product and the service is worth resubscribing to. Back in 2013, our renewal rates were in the high 70s, and we worked progressively to get that back up into the 90% mark, which allows us to use product innovation, product development and new business to drive growth rather than just revenue substitution. The kind of poster chart for success for us has been Informa, where we've taken our sightline brand and our script brands, long-standing brands and really invested behind them to build out our credibility in clinical trials intelligence and the workflow tools that we're offering our customers, whether they be pharma companies or CROs. We've added to that with marketing services capability and most recently with clinical trial performance capability with the addition of the trial scope business, which we brought into that portfolio last year. The combination of those products and services in that, it's very specific specialist market around clinical trials and drug trials and drug discovery, which has been very topical for all of us in the last period has proven to be a real success story. We are, and we touched on this briefly in our release looking at a similar, if you like, adjacency extension in our financial data business, where we have a business FBX which provides pricing and product data to largely U.S. retail banking institutions on available products in the mortgage market, and we're looking to create a partnership with another business that does essentially the same thing, but with the different take but focused on the lending market. And we believe that combination will make us a much bigger player, much more relevant and allow us to extend our relationships with that banking customer base. So a steady development of product, of relevance of performance and of capability is what is really stands behind our commitment to growth and acceleration in Information Services. Similarly, in Taylor & Francis, which has been a much longer part of our company. But Back in 2013, 2014, the big gap, if you like, was our lack of presence in what at the time people believed was certainly a change, possibly a challenge and conceivably an existential threat, the provision of Open Access services, the ability for people to pay to publish rather than be bounding or limited to a subscription access product either at the point of publication or at the point of consumption. We have moved progressively into that market by addition and by organic development. We've also become much more flexible and customer-orientated in the way in which we construct access to what you might describe as more traditional research subscription arrangements. And at the same time, we've been innovating in the electronic service provision in our reference business. And the combination of all of those things has made the business much broader, much more customer-orientated and is shifting the emphasis away from a business that was born and rooted largely in providing services to institutional academic customers, largely through the library or the librarian, still a very important part of our product and customer and service mix, but increasingly not the only part. And again, that diversification and that spread and importantly, flexibility and capability is what is giving us strength to underpin a return to pre-COVID levels of growth and performance on a going-forward basis. In our events business, when the world closed and we all went remote, the same was true for the provision of services to our B2B customers. We did have a range of capabilities, but they were varied in some cases, patchy. And in some areas, not really fit for the level of scale that you need when half the world's population is in forced lockdown. And so 2020 really was a real-life crash course, in how do you accelerate capability in any or all of these services, a simple hybrid event or a virtual event, online matchmaking, directory services, product services, search services, video services, webinar services. There's a whole range of digital services that we've had to bring to market and develop. And we've used 2020 really to come to an approach which allows us to build a technology and service stack, and we've centered on 2 largely swap card for our B2B marketplace businesses, our trade show businesses and Totem as the platform and service stack for our knowledge, content and networking products. We now actually have a nontrivial business in providing virtual and hybrid events with a high level of participation. The user experience is getting better. It is not, in our view, a replacement for physical product. It is an addendum to, in some instances, a hybrid companion to a physical product. And in other instances, it allows us to extend out of the physical time period to allow more continuous relationship with our customers on an ongoing basis. We would not have wished any of the circumstances of COVID-19 for anyone let alone for our business. But it has allowed us at speed to both accelerate and compress the learning and the capabilities we need in this area, which previously perhaps we saw as a secondary or tertiary activity when physical events were operating at full bore. To give you a specific example, CPHI, which I know many people who may be watching today have either been to or seen [Technical Difficulty] leading destination event for Global Pharma. In 2020, [Technical Difficulty] high degree of forward demand for that event to come back physically, but a high degree of continuing participation in the provision of content, contact and continued engagement through the hybrid platform. Talking of data and information. We, as a business inevitably generate an enormous amount of data at a simple level, profile data, who are you? What companies do you work for? What is your area of specialism, what are you interested in? Who do you want to meet, what products and services are you most attracted? We also get activity data either on the firm or the company or on the individual as a result of participation or usage of product. [Technical Difficulty] on data collection. And then post the collection data collation and then doing that in a way that has all of the appropriate consents and confidentiality, but then might allow us the potential to develop additional services of value to our customers on lead qualification, on access or indeed on purchasing intent. We have stood that up inside our company as currently a nonrevenue-generating operational unit. We've given it a working name inside our business so that we all know what we're talking about. IRIS and the quality of the data in IRIS, the value of it as an input into the accuracy and relevance of what we're doing for our B2B customers, we believe will be one of the long-term benefits of the experience over the last 12 to 14 months. I'd like to touch on sustainability. This is for good reason, a topic du jour increasingly everywhere in the world. Gareth and I are making this presentation based in London. And of course, in the United Kingdom this year, the U.K. government will be hosting the COP26 gathering of countries from around the world, focused on the issues of environmental and climate change. 5 or 6 years ago in our business, we took the view that this was going to become a very relevant clearing factor for customers, for colleagues, candidly, and also for investors. And ESG has emerged as the term of art to define the appropriate level of impact that a company is allowed to have or should have in order to pursue its commercial aims and gains. We have built up a capability inside our business and then a programmatic approach to getting to carbon neutrality where we already are, an appropriate level of ranking and performance in the indices we have chosen to enter to be the ones that we pay attention to. As many people on this call will know, there are many ranking indices, but there are some that are judged to be good measures of where companies are performing. And we've invested time and process outcomes as a result of participating in those. And also, we've built some endless changes around energy supply, around contractor relationships, around obligations on the supply chain, around office usage and the practical impacts of our activities on carbon and carbon consequences. We feel very confident that our program, which we call Faster Forward, will get as to where we want to be, net 0 by 2030 or earlier, 0 waste by 2030 or earlier. And we see ourselves as having the ambition to be able to provide a product or a service, a subscription product, a reference product, a research product, or a physical event product, which more than secures the most efficient way of allowing our customers to do their business with the lowest leased or 0 carbon impact. And from an investor point of view, ensuring that we retain our ESG credentials for that source of capital that only wants to allocate itself to businesses with those credentials. So just to summarize where we are in 2021, our view of 2021 is we want to be at a minimum steady as she goes. In order to do that, whilst the £1.7 billion baseline looks hauntingly familiar to the £1.7 billion circa outcome in 2020, the composition is different. There's at least £300 million worth of revenue that does not repeat in 2021 that we had in 2020. And a lot of that is being compensated for by a combination of growth in 2021 in our subscription businesses versus 2020. Continued growth there. The return of physical events in those parts of the world that we know, Mainland China primarily, the increase in our ability to provide credible and compelling and relevant digital services to our B2B events customers. Do we see a possibility to move from steady as she goes to steady as she grows and that baseline number goes up? Well possibly. And there may be a faster return to physical events, particularly in North America that we can see here today in April, and we will provide more guidance on that at the half year in July. So to summarize, a year of continuing stability but a transition year. More products and services in B2B digital services, greater power and value in our data. We stay within our cash. We manage our costs. We don't draw down on our liquidity. We commit to a baseline of £1.7 billion, and we watch, wait and participate constructively and responsibly on physical return, particularly in North America. We continue to invest in our program of sustainability and sustainable impacts or carbon impact sustainably to preserve our ESG status. A housekeeping with an important housekeeping point. John Rishton, our new Chairman, not the new colleague for Gareth and I. We know John well and have worked with him for the last 3 or 4 years, will take over as Chairman of the company in June at our AGM. John has spent time already meeting most of our larger shareholders and soon a broader community of our smaller shareholders. He knows our company well. He brings significant and relevant experience for where our company is going on a going-forward basis, particularly internationally, and we're delighted at the prospect of working with John. But he will forgive me, and hopefully, you will, if I finish by saying thank you, both a company thank you and a personal thank you. This is a virtual event. And hopefully, it's working for you. In normal circumstances, our Chairman would be here, and many of you would be too, and you get a chance to say your own fair wells. Derek has been many things to this company. We worked out the other day that he's been around the Board of a company either not quite called Informa, then called Taylor & Francis as an Informa now called Informa for over 20 years. That probably pushes the boundaries of corporate governance rules today, but things were different then. Derek can, I think, lay claim to being a co-creator of our company. He can certainly lay claim to having made an enormous contribution to our company. And he has been a compelling and very effective counselor for many people, including myself, Gareth and many colleagues across the company. He's been a great colleague for shareholders. I hope you share our view that he really has more than delivered impact and value, and we wish him well, and we'd like to record our thanks. I'd now like to take some questions and I'll hand It over to the moderator.

Operator: [Operator Instructions]. So we can now go to our first question, which is from Nick Dempsey from Barclays.

Nick Dempsey: I've got three questions, all on events. So first 1, can you give us any indications on the forward bookings picture of '22 from the larger Chinese shows you just run like Hotelex. Second question, I mentioned Hong Kong, really, I don't think in the presentation, as far as I can tell they've got a 4-week quarantine at the moment, authority say they're very cautious about opening up there. How likely that we get physical events in Hong Kong in the second half, I'm thinking of the Jewellery Show in Kolkata. And the third question, you mentioned pricing is one thing that you are giving some consideration to in 2021. Stephen. Isn't the rule and exhibitions that if you start giving pricing discounts 1 year, it's super hard to get those back in your negotiations for the following year? So can you maybe elaborate a little bit more on what you're thinking about the pricing? .

Stephen Carter: Okay. I'll just take the -- I think I'll just take those in the order they came. On forward bookings for '22 are strong is the short answer. And specifically, on -- I don't particularly want to get into a show by show forward booking number because you'll come back on me next year. But specifically, on the one you mentioned, actually, I would say, at the top end of strong. And indeed, for those events that we've already made a decision are not going to happen in '21, and we've moved to '22 forward commitments equally remain steady. And I think Gareth spoke to that a bit on both cash and refund. So both our customer satisfaction work and our forward bookings on either events that have been held in '21 or events that have been moved to '22, I think we feel is giving us cause for confidence. Hong Kong, good question, apologies for driving past that. We drove past it because it's not in our £1.7 billion number, just to be clear. We're going to reserve judgment. You're absolutely right. The situation in Hong Kong is materially different from the situation in Mainland China for a variety of reasons. We have not yet made decisions on either Jewellery or CosmoProf. And we will continue to work with the authorities and the relevant parts of the industry. And in the case of CosmoProf, our partner, fair to decide what the options are. There are conceivable options, probably more options, alternative options for CosmoProf then for Hong Kong. But at the moment, we've made no judgments on that. On pricing, I mean, I don't want to overstate this, but really our primary objective, and I think this is sensible for 2021 is metaphorically or literally to get customers back on the horse and remind them of the benefit of the product. And so we have -- we are not engaging in material work on price rises in '21 on what would be '21 on '19 in the main. I'm not sure I entirely agree with your view that the comp going into '22 or '23 will be what happened in '21 or '20 because it's such an aberrant experience. And frankly, we have a high degree of confidence, and we've seen this where we have reopened events that the customer response to getting back to meeting their customers, meeting their suppliers, meeting their distributors and trading is such an in the round positive experience that the sense of satisfaction, commercial satisfaction and personal reward from participation, I think, will give us comfort that the customer value is there, the product value is there, and therefore, we can price to that. But in good time, Nick.

Operator: We can now I take your next question, Annick Maas from Exane BNP Paribas.

Annick Maas: I also have three questions on the exhibitions, but a bit more medium term, I guess. So the first one is, I assume your negotiation power with leading venues must be relatively strong given your portfolio. Has that helped you maybe in renegotiating some of the contracts with these venues and that could help your margins, for example, in the future? My second one is on insurances. I guess some of your peers stood apart really by a very strong insurance policies. Has COVID made you rethink how you think about insurance policies in the events business and how it could strengthen your model going forward? And the third one is, last June, we are back to 2019 levels next year, the year after in three years, beyond that, what are the 3 elements that make you think the industry could grow at a higher pace than it has over the last decade, please?

Stephen Carter: Thanks, Annick. I'll try one. I'll let Gareth deal with two, and then I'll comment on 3 and he may want to comment as well. On the first point, I mean, I would like to put on record from our point of view as a company, how constructive our discussions have been with venues in pretty much every place in the world where we operate. And that is quite most places where trade shows are conducted. I mean, by and large, those have been partnership discussions. We were helped, I think, in that, in that we decided early to postpone. And so the forward management of capacity and rebooking and the shifting of contracts to accommodate for that. We were certainly earlier and in many instances earlier than most. But by and large, those conversations have been really very constructive and flexible. And in many instances, venues adjusted for us even they contractually, they could have taken a different position. And that was material to us in 2020, and that mattered a lot. On a going-forward basis, it varies depending upon where you are. I don't think it's yet clear in my own view as to what the long-term settling position on venue pricing, either the number or more importantly, the architecture of the pricing and because costs are calculated quite differently, depending upon which venue you're negotiating with. And so I think that is slightly up for grabs. It is probably our single biggest unit cost, it's about £300 million of our costs and therefore, we pay attention to, as you would expect. And we will want to manage the return of our costs, as Gareth said, with as much discipline, if not maybe more, than the return of our revenue. So if the experience of 2020 and '21 is only to go by, it has deepened the relationship with our venue partners. And we all have the same objective, then in a way more than us because many of those venues are owned by states or governments. And so frankly, in many locations, the value of returning to a location, go back to Nick's question about Hong Kong. The value to Hong Kong of bringing CosmoProf or Hong Kong Jewellery or indeed any other organizers event to Hong Kong, way exceeds the venue rentals and they, like you were taking a long-term view. On the '19 levels and return for growth, and when that happens, I mean we're not calling that, but we share your view that it's probably a 1-, 2-, 3-year journey. We do believe that the experience of developing alternative digital services will give our secondary tertiary revenue streams, which we can develop. And we do think that the market will pivot in favor of highly efficient travel and highly efficient travel is never better illustrated than a large-scale, high-impact industrial trade show because you can avoid 50 travel experiences by having one. And we believe that, that value equation is going to be written larger as the world gets more penetrating on true cost accounting and full cost impacts for commercial activity. And the power of the trade show, the Single Point trade show, which is the hallmark event in an industrial calendar is going to go up, not down. Do you want to touch on insurance, Gareth?

Gareth Wright: Yes. I think insurance really going forward. I think the first question you've got to ask about insurance and event cancellation insurance post-COVID is will you be able to get it? So you saw this in the Far East. So actually, since the SARS outbreak coming up to 10 years ago, actually getting event cancellation assurance in the Far East has been impossible. The market just won't ensure that. And I think what you're going to see post-COVID is the insurance market will have a real fundamental reassessment of event cancellation insurance and the areas where they've had to pay out post-COVID. And there will be elements of that insurance cover that you just won't be able to get. If you can get it, then, of course, it's going to be what cost is it going to be to ensure yourself in that. And again, premia, I think, across all types of event cancellation insurance are going to increase markedly. We're already kind of getting that feedback from the insurance industry. Prices aren't settling yet because we haven't got out of COVID. But if you can get it, then it's going to be what cost is it to you, and does that become an economically favorable or advantageous position to go into. So we review the insurance coverage on a regular basis through the year. We have an annual renewal as you'd expect. That annual renewal is on a calendar year basis. So we're a good 6 months off from engaging with that for the 2021 year. But that's how I would be thinking about insurance going forward is something that process is just going to be harder to actually get in terms of event cancellations, both for the exhibition industry but across the wider events business, if you're running concerts or anything like that as well, it's just going to be harder to ensure yourself in those markets.

Operator: Next question comes from Adam Berlin from UBS.

Adam Berlin: I've also got three questions on event. First question is, you said that you delivered around £300 million of event revenue in Q1 '20. Can you tell us the number for Q1 '21? Second question is, what do you think is a good assumption for us to use for the drop-through of any incremental revenues above the EUR 1.7 billion baseline from additional physical events to EBIT in 2021 based on the previous conversation around menu renegotiations as well? And my third question is, given the good liquidity position you're now in and signs of a recovery in physical events, are you a bit more open now to looking at M&A going forward? Are there things in the market that you've always wanted to own that are kind of available and a bit cheaper than normal that you're starting to think about? Or is it still too soon?

Stephen Carter: Thanks, Adam. Interesting questions. I might take them in reverse order and let Gareth decide how much he wants to tell you about the first one. On the last, a bit cheaper than normal, I think, is the key question. I mean, we have not spent an enormous amount of time on this, but there's not much evidence that our asset owners are repricing for the current circumstance. We'll see how that changes. We always keep an open mind. And the only thing I would say, if your question is related to the Events market specifically, which I assume it is from your opening comment that you had 3 questions on Events. I don't believe that even without the pandemic, we were not really at a point where we were looking to make a further acquisition or addition at scale in the Events market. We have a material platform capability in every major geography and in the 10 or 15 major location markets. And what we have been focused on even before the pandemic is adding specific competencies and capabilities, more focused on data assets. I think the last acquisition we did in the Events business was a data information business in aviation called CAPA, which we added to our aviation portfolio, which consists of events, media and now data. Then the last acquisition we did last year was Trial scope, which was a data business in our Informa Intelligence portfolio. So might we pick up spot opportunities? Yes, but the key will be are they priced accordingly. On the drop-through point, I don't know the answer to that question, but I probably wouldn't be dropping it through the normal 60%, 70%. I'm looking at Richard. You would see me doing that, Adam, if you were here in person. I mean I think for a combination of reasons, I think that's going to be a lower number, if you go back to my getting people back on the horse point. But the self-evidently, there'll be a drop-through, I don't know what the range is 30% to 50% probably, something like that. But right now, we're primarily focused on getting venues opened up. We want that opening to be successful for the community, for the location, for the participants. We've seen how beneficial that is in Mainland China. We did -- we had the same approach in China. And now we're kind of bar international participants were back to pretty much pre-COVID performance levels. So I think we'll overinvest in the all secure environment, we'll overinvest in marketing, we'll overinvest in customer support. And I think that will be a very sensible way of driving participation revenue and confidence in the product. On the first quarter, well, I don't know what the exact number is, but the truth of the matter is the first quarter was an odd quarter because we postponed everything out of the first quarter, but what is the exact number?

Gareth Wright: Minimum. We ran some outdoor events in the U.S. and run a couple of boat shows, et cetera. We've run various small events globally in areas where we have permission to operate again. But at a headline level, the number was very low for Q1 because of that decision to shift all the revenue out of the period before late spring, early summer. So It's not that we've been running events and generating no revenue is the fact that we just haven't operated the events because we wanted to get out of the Northern Hemisphere winter, we wanted to get to a period where more vaccinations have taken place. We also want to kind of avoid any fallout from the U.S. elections, et cetera. So that conscious decision to move everything back to late spring, early summer, means just the operational activity in events in Q1 has been very, very low.

Operator: And our next question comes from Patrick Wellington from Morgan Stanley.

Patrick Wellington: A couple of questions. I'm going to ask one not about Events, which is Taylor & Francis. What is a pre-COVID level of organic growth? I would say it's 2% plus, but you may have a different answer. Second question is about the scale of a couple of things. I mean I think you touched on the idea that you might drop some of your smaller events and that they won't return post-COVID. So can you give us an idea in revenue terms of the scale of such events to be dropped? And would that imply that Informa post-COVID in events is faster growth and higher margin because those events would have been slower growth and lower margin? And similarly, could you give us an idea of the scale of -- there seems to be a decision going on to not hold some events so that you will have a better 2022. Can you give us an idea of the scale of that number in revenue terms? And then nicking a fourth question, I'm going to make an assertion which you might not agree with. If I go back to September, your first half results, I would say that you are less bullish about the degree to which you will exceed the EUR 1.7 billion baseline than you were at that time. So in summary, and sort of Twitter 140 characters. Why are you less bullish? And does that make you, at the same time, more or less positive about what the revenue outturn might be in 2022 because some of those things you're doing are for the benefit of '22?

Stephen Carter: Thanks, Patrick. It's quite a lot in that. Let me try and work my way through some of it and turn to Gareth for help. On your Taylor & Franci's point, I mean pre-COVID levels of growth for us would be between 1% and 2%, and we'll take a view. We've had a good first quarter and in all aspects of the business in Open Access, in subscription renewals and in both physical and e-books. I mean, as you know, better than anyone, it's underneath the kind of surface of COM progression, it is a more volatile market than the consistency would suggest. But we feel, I think, confident about the power of the portfolio and the nature of our ability to remain relevant to our customers. So sort of in that range, and we'll see whether it's better. On smaller events, yes, probably, we haven't put a revenue number on it, an event number. It's maybe, I don't know, 80 plus, maybe as many as 100 brands might not return. And you're right, I think, that we'll focus the portfolio. I was trying to get into that on my slide on the kind of portfolio architecture. I think it will force us to focus more on the larger brands, the power brands, the market brands and the major trade routes. And my own personal view is I think the market will naturally go to those for a variety of reasons. And those are definitely assuming you don't have capacity constraints, those are higher-margin businesses with potential growth. I think the real question on -- if you're trying to do revenue balancing is can we replace that lost revenue from the -- those, if you like, disappearing to use it find a better word, smaller events products from digital services over the period. And I think we feel quietly confident that there's an opportunity there as well. On bunching, it's very hard to give you an answer to that. I apologize, but we really are taking it on a case-by-case basis. And for some markets and some geographies, for some reasons, it really matters to the community to have a start -- restarting event, and therefore, we might do it for individual reasons. In others, we might come to the agreement that it makes more sense to pause and wait for a kind of "full return in 2022." And that is often determined really by the end state of the market that we're serving. And so we really are making it on a case-by-case basis. But you're right to say that our focus is on balance more on ensuring that the event in '22 is a powerhouse success for the industry and rather than we serve something up in '21 just for ourselves. And I think that is really going to bear a lot of fruit in the future because it is deepening our relationships with key industry groups, trade associations, partners. And I think the responsibility dimension of that is relevant. Am I less bullish or more bullish? We -- I mean you're probably a better read of it than me in a way because I'm not objective. I don't think I'm either less bullish or more bullish. I just -- I don't have enough evidence yet sitting here in April to be able to call it. Picture is very clear. I think the confidence and factual performance in Mainland China, frankly, has been stronger than I would have predicted. So I was less bullish on that than it has materialized. I was in 2020, as you know, I believe -- we believe that America was back in September, October and it didn't. And that encouraged us to be more prudent. And for now, I think staying in the steady as she goes rather than steady as she grows category, is sensible. Let's see where we are in the half year. I think that's how I would say it, Patrick.

Patrick Wellington: Okay. But if you looked at just the pace of development, do you think that makes you more bullish about '22 than you were in September? Because as you say, China is probably doing better. And frankly, I think you're expecting 30,000 people to turn up a World of Concrete, which seems like an amazing number. So doesn't that make you feel that the U.S. has perhaps developed faster than you originally thought?

Stephen Carter: My confidence in the long-term value of the product and the enthusiasm and commitment of customers and partners and associations and venues and locations for the relevance and the impact of physical has definitely gone up. But what happens in May or June, I mean we're delighted to be going back to Vegas. We put a lot of work into that reopening program with the authorities on the ground. We use the pop-up in Orlando in the earlier part of the year to give us a case study and how to do it responsibly. It's important to us. It's important to the community, and it's important to Vegas. But as you know, to take the World of Concrete example. World of Concrete is normally a January show. And the reason why it's going a January show is in January, most people they're not laying concrete, whereas in June, they are. So as you know, the calendar date is very important to many industries. And every time you shift it out of its normal slot, it doesn't mean you can't run a credible event that services the market, but there's normally a reason why Industry X meets in Anaheim in March or Barcelona in February or Vegas in January. And getting back to that calendar cycle and rightsizing the cadence of the industry does give me more confidence about '22.

Patrick Wellington: I think of Barcelona in November, myself.

Stephen Carter: That's a commercial break, Patrick.

Operator: I would now like to take the next question from Rajesh Kumar from HSBC.

Rajesh Kumar: First question is on financial gearing. What is your thinking on the appropriate longer-term financial gearing? I appreciate that you might have not finalized what is the right number. But if you could give us some color on how you're thinking about it that would help. The second one is you provided some color on '22 forward booking. The numbers are looking strong. If we were to think about the number of exhibitors and participants, could you give us some color on if the same number of exhibitors or 10% lower than 2019 level of exhibitors are thinking about turning up? And if participant per organization is greater or lower to, but just how do you see the moving parts in that strong forward booking number? The third one is on Taylor & Francis. I think it is going quite strong. There have been a lot of questions around the library budgets, especially on the academic publishing. Last year was quite strong for Open Access, quite a lot of researchers finished their articles because they can travel. Do you think we need to think about bit of difficult comps or library budgets when we are thinking about the near-term future?

Stephen Carter: Are you finished with the -- laying out your questions, Rajesh?

Rajesh Kumar: Yes. Yes. Three questions.

Stephen Carter: Well, thank you very much. I'll touch on the third and the second and maybe let Gareth pick up on the -- how we're thinking about gearing in the mid- to long-term. Well, to take your second, it's a good question. I mean for now, we are working on the assumption that international travel, however you define that, will be muted limited and in 2021, essentially nonexistent. Certainly, there's no assumption of that in our £1.7 billion number and frankly, not much assumption of it even in the likely upside. I don't have a good enough crystal ball to give you a view as to when that will return. There is much talk as you will know about travel tunnels between key locations, London and New York to give you an obvious example with others. We're taking the view, I think, sensibly that we should be thinking about '22 with probably less international travel than historically, which, therefore, means that the domestic and subregional markets and attendees and exhibitors become more important. And within that, that probably means that from a customer profile point of view, the small- to medium-sized enterprise exhibitor becomes more important than the large corporate exhibitor. And actually, that speaks well to the trade show because the trade show is a much more attractive product or a very attractive product for an SME customer because it's a way of getting to market, meeting customers, getting profile, gaining distribution. Corporate customers, large-scale international multinationals have other routes to market. And I think we feel confident that for the domestic and subregional SME, the trade show will remain popular. So you might see some infill, maybe lower large-scale multinational corporations and more SMEs. So there might be a change in mix. And we're seeing a bit of that in Mainland China and in other places. On Taylor & Francis, you're correct. Statistically, library budgets are definitely feeling the pinch. The converse of that, of course, is that actually, participation in advanced learning is on the increase, not just in the United States and in Continental Europe, but importantly, in China and India and other parts of the world. So the demand for specialism and advanced learning, the bit of the education market that we're in is definitely increasing. And the participants in the funding of research are broadening. Now that does not mean that the academic institutions are not by far and away the majority, but they are increasingly not the only participant or funder and certainly not the only user. And that is in large part what is driving a lot of the Open Access activity because it's becoming more accessible to get in. But what has not changed, and the COVID actually scored this truth if nothing else has, is the power of independently verified science. And this, the need for it to be done at speed, but with accuracy and independent validation and verification. So the fundamentals of the market we feel good about. Gareth, do you want to pick up on the gearing?

Gareth Wright: Yes. I mean, clearly, at the moment, our short-term objective on the gearing is very much around reducing it from where it was at the year-end of 2020. We have consistently reduced our debt levels since 2018 when we completed the UBM combination. Our objective then was always to bring the debt down. And that has been successfully achieved. You've got to adjust for IFRS 16 coming in, in one of the years. But otherwise, if you look at it since 2018, it's been consistent in March down in debt levels over time. In terms of leverage, it's gone up, which is really a function of the lower EBITDA in 2020. And as that reinflate, you'll see the leverage, I think, come back down again alongside the lower debt. Our ratio -- I mean, technical ratio, our limits are 2 to 2.5x leverage going up to 3 to use the balance sheet efficiently and effectively for an acquisition. And that is kind of clearly our current stated range. I think if the range had been a turn lower, I don't think we'd have been in any different position really in the pandemic simply because of the lower EBITDA levels that you've seen in the business. So actually, having that range in that place, I don't think was inappropriate or wrong for the business, it's just a one-off nature and the size of the pandemic that's really delivered the impact we've seen in the leverage. So kind of to cut to the chase in terms of your question, going forward, as a matter of record, we haven't really discussed it at the Board level yet because the Board's focus to us has been on reducing the leverage, getting it back down to the range. We will do it at the right time. But as I said, I don't think being half a turn or a turn lower in terms of our range would have materially changed the outcome in COVID times. And therefore, I'm not going to commit to a change in the range now, we need to have that conversation when we're out the other side of the disruption.

Operator: We can now take our next question from Tom Singlehurst from Citi.

Thomas Singlehurst: It's Tom here from Citi. So firstly, I was going to just go with Patrick and say that I thought you sounded more bullish. And the reason being you delaying shows And so as you say, you've got confidence that they should -- could happen in 2022 on a bigger scale. But the question is, can you just quantify what proportion of the sort of 2019 level of shows you will be running in 2021. I think on the Informa Markets website, you talk about 500 branded events. How many are they going to be taking place in 2021, just so we can make an assumption that all 500 or equivalent would be running in 2022, but what proportion of those have taken place in 2021? That was the first question. And then the second question, very simply on Taylor & Francis. Just going into the downturn. You bought F1000, which, as I say, didn't necessarily get a huge amount of focus because it happened about 20 minutes before COVID struck. But it seems to have won a relatively big mandate from the European Commission. And is opening up, as you say, a sort of new beachhead of potential revenue. I'm just interested in the context of the long-term revenue development of Taylor & Francis, you've given us a long-term target for intelligence. Should we assume a similar level of growth for Taylor & Francis since the longer term or at least a better level of growth than you delivered over the last 5 or 10 years?

Stephen Carter: Thanks, Tom. Interesting questions. Well, you're a braver man than me to disagree with Patrick is where I'd start. On the proportion of shows, I don't know the exact number. I think on the current forecast, I'm trying to remember the forecast numbers of currently, potentially scheduled shows, it's around 75% to 80%. But the question is how many of them will actually happen? And as you know, as well as I do, the kind of rule of thumb is 3 months out. It's not as hard as that, but it roughly is. And so if you ask me that question in 3 months' time, how many of those actually come to pass because it's not clear where -- and because we operate in so many markets, there are quite a lot of variables. I think where the rubber really hits the road, that's what we're trying to explain today on the '21 upside to the baseline is what happens in North America because that's where the scale shows with the exception of CPHI and 2 or 3 others really happen. On T&F, you're right. I like your phraseology. It pretty much was 20 minutes before COVID hits. It has had -- you should be reassured it's had huge amounts of focus inside our company, as you would expect. And it's been a great addition. And it's been part of building out our Open Access capability, in that case, more open science and open research. And as you say, part of their offer is providing a kind of a neutral platform or kind of white-label platform in a way for other parties and well spotted on the European Commission contract, which we were delighted to land and there are others. And you're correct, we are using this time to further expand the service offering to sit alongside traditional subscription, that's not disappearing. It might have to be more flexible. The contracts might have to be more bespoke, but are a range of Open Access products and services going to be part of the -- a scale part of that business. In the time line we're talking about today, 2021 to 2024, for sure. Are we ready today to commit to a hard upgrade number for Taylor & Francis? No, whereas we are in Informa Intelligence, but let's return to that at another time. But the fundamentals, I think we feel good about. And F1000 has been a great addition to the portfolio, much like Dove was actually 2 or 3 years ago.

Thomas Singlehurst: And just one very quick follow-up. You said 75% to 80% roughly, and we're not holding you to the exact number. Of those, what proportion of those that aren't taking place, what proportion are deferred and what proportion have just sort of being deemphasized some of those smaller brands that you talked about?

Stephen Carter: Most of those would be deferred. I mean I won't say all, but most would be deferred because frankly, we wouldn't have stood them up as the first 1 to bring back if they were a potential for cancellation.

Operator: Our next question comes from Matthew Walker from Credit Suisse.

Matthew Walker: I've got one question for Stephen and one for Gareth. So the question for Stephen is, can you give us a sense of the breakdown of your U.S. events revenue by location? So how much Nevada, California, Florida, New York, et cetera, And do you want to comment on the fact that the governor in Nevada said that it could open up to 100% capacity from 1st of June onwards? And then for Gareth, on your event, costs, you had about £800 million of cost in the Events business in 2020. How much of that was direct versus indirect? And then what do you think of the direct versus indirect split for events in 2021? Maybe you want to give us a baseline on the £1.7 billion That would be helpful. And then with the £1.7 billion of revenue, what would be the equivalent free cash flow that would ally to that £1.7 billion?

Stephen Carter: Should I go first -- Okay. If I understand the question, Matthew, I mean, I don't think we're going to give by dollar sign revenue by location guidance. But if you look at the slide in the pack or on the screen on Slide 12, those bubbles are indicative of relative size. So Nevada is a big bubble and New York, New Jersey is a smaller bubble. And that is not simply graphic design, it's a key. So not surprisingly, therefore, Florida and Nevada and actually, for very specific reasons, Pennsylvania moved the dial because in Pennsylvania, slightly back to the earlier question from Patrick, Wellington. That was an example wherein very active consultation with the industry, we decided to cancel our Natural Products Expo show in Anaheim in the spring. And whilst we normally run a secondary show on the East Coast, this year, that secondary show on the East Coast will be a more material potential for the industry to meet that has not been able to do so for some time. So that might be a slightly bigger bubble in Pennsylvania that might ordinarily be the case if you get my point -- if that helps. On your -- you had a second-order question on that, which was -- yes, yes, yes. Sorry. Sorry, Matthew, I'm losing my train. I don't know if that's been confirmed. It's certainly been indicated and -- but I don't believe it has as yet been confirmed. But Just -- I mean, I'm sure this is clear to you, but just in case it isn't to others, the 50% capacity is a capacity -- is a fire marshal capacity on absolute numbers of people in the location. Actually, given the size of that location, we can work comfortably actually, at 50% and still have a very significant event, which was touched on earlier on potential attendees at World of Concrete in June. So I mean if it goes to 100% and sort of as normal, that's great because it speaks to confidence, but it isn't going to materially change our ability to drive numbers, if that's clear. Do you want to deal with...

Gareth Wright: Yes. So there's many other ones. In terms of the cost base, yes, I'd say the split between direct and indirect in markets is kind of 50-50. You've got Stephen touched on earlier, quite a bit of venue cost in there in the directs and then a bit more in the indirect is primarily the cost of colleagues. Connect and Tech is probably more like 40%, 60%, 40% direct, 60% indirect. They have a bit less in the way of venue costs running smaller events in some of the cases in connect in particular. So that's the kind of split I'd be thinking about in terms of the numbers that we did in 2019 and in 2020. In terms of the free cash flow, at £1.7 million, what we've done is we've reset the cost base, or rightsize the cost base to be cash flow neutral to cash flow positive at the £1.7 million figure. So at that level of revenue performance, the cash flow would be relatively small, but positive as we've done in Q1, I think we'll be positive across the remaining quarters of the year. But it wouldn't be a material figure because we've looked to only take the cost down the level where you get to that kind of neutrality, slightly positive position. We have them able to go beyond that to protect the business for recovery in 2022.

Matthew Walker: Can I just have a quick check?. Just a quick check question, which is, you said, I think, back in the last time you spoke that you were going to run 90% of the shows, and that was going to be between June and December. Are you now saying 75% to 80% of the shows are running June to December? Is that what you're saying? And what percentage of the normal schedule of the U.S. show that you're running specifically?

Stephen Carter: Sorry, what was your last question there, Matthew?

Matthew Walker: So the last question was really compared to the 90% of shows that you said you were going to run when you last updated the market, you said you were going to run 90% of your shows between June and December 2021. Are you now saying it's basically 75% to 80% of the show you're going to run? And then what is that number specifically for the U.S. for 2021?

Stephen Carter: Okay. I think if I understand the question, I'm looking for help here. I think what we meant, and apologies if we weren't clear, was that it was 90% of the 75% to 80% was going to run in the back end of the year, if you see what I mean. Is that clearer, Matthew?

Matthew Walker: I'm not sure.

Stephen Carter: Well, we are -- we materially -- I mean it rather speaks to why our Q1 revenue number for events was relatively low is effectively, we pivoted our postponement program shifted most of our event profile from June onwards, of which the vast majority of that is in the back 6 months. The overall number of events that we're planning and running is about 75% to 80% of the normal portfolio. Is that clearer, Matthew, sorry?

Matthew Walker: Yes. So I guess the question would then be, of what you would normally run in the normal portfolio in the U.S., what proportion are you intending to run in 2021?

Stephen Carter: I don't have that number to my fingertips, but I know a man called Richard, who will provide you with an answer shortly after we're finished.

Operator: And our final question comes from Sarah Simon from Berenberg.

Sarah Simon: No, I haven't thought of anything clever to say, and I've also got drilling next door. So I'll try and keep it short. So the focus obviously has been mostly on the trade show side of things because that is the larger bit. But as you think about the long tail on the kind of impact of COVID on that, do you think, inevitably that when we look out a few years, it's going to be competitive of taking the majority of the hit in terms of the trim? Or do you think it's a kind of equally spread impact? That's the first question. Second one, just on China, you talked about domestic really being back at pre-COVID levels. Can you just give us an idea, you gave us a split across the portfolio as a whole in terms of kind of domestic versus international. But could you give us an idea of how that lies for the Chinese market specifically?

Stephen Carter: Thanks, Sarah. Interesting questions. China, you're right. It's a good question because the index is higher in China, in Mainland China. Hong Kong obviously is quite different because index is way higher on international by the nature of the products and the location. I don't know the exact number, but it's probably near 85% in Mainland China is domestic. On conferences, well, there are quite a few nuances in there that we've discovered. I mean as it speaks to our own portfolio in both our Tech business and our Connect business, which is really where our conference product is, we had already gone through quite a material long-tail reduction. I mean -- and I mean material in tech. So actually, most of our conference or complex products in Tech, these are sizable brands and events. I mean Black Hats is a -- on any level is an industrial product. It's a content product. And so it's technically a conference rather than a trading transaction product like a trade show. But we believe it has significant value as a physical product and is, therefore, likely to remain. Will there be some further trimming in Connect on the smaller end of their conference program? Yes, probably. But the other nuance is if we look at those products, those meeting products, if you want to call it that, that transferred to hybrid or virtual, the learning, networking, knowledge-only product landed itself more naturally to hybrid or virtual than the transaction trade show product. It doesn't mean you can't do a transaction trade show product virtually, you can, but it's nowhere near it's compelling for the customer, the buyer-seller community as the -- some of the conference product. So using alternative digital service delivery for the conference product is a bit easier. And so that might be a place where the so-called long tail might hang out more comfortably leaving the bigger conferences to be more physical if that makes sense.

Operator: That concludes today's questions and answers. So I would now like to hand the call back to Stephen for any closing remarks.

Stephen Carter: Okay. Well, look, we've taken a lot of people's time. It's half past the hour. I think that's when we schedule to finish. So I appreciate the attendance. I can see from the numbers that we've had a high degree of participation. I hope it has been useful. Thank you very much for your continued interest in the company, and I hope everyone is keeping and staying well.