WILMINGTON PLC

Management Reports • Dec 10, 2014

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RNS Number : 3017Z

Wilmington Group Plc

10 December 2014

10 December 2014

Wilmington Group plc

Interim update on Business Review

Wilmington announced on 18 September 2014 that it was conducting a review of its businesses following the appointment of Pedro Ros as its new CEO. The Group is today providing an interim update on the progress made to date. The Group will provide a more detailed update at the time of its half year results at the end of February 2015 and is pleased to confirm that current trading remains in line with expectations.

After an in-depth review of its assets and the market opportunities, Wilmington is evolving its business to a knowledge-based model and structure. This will maximise Wilmington's opportunities in helping its clients meet their evolving information, education and networking requirements and, as such, this is reflected in the new divisional structure outlined today.

Wilmington's vision is "to be the recognised knowledge leader and partner of choice for information, education and networking in Risk & Compliance, Finance and Legal as well as the Insight leader in a number of chosen industries."  

This new focus and vision will help Wilmington:

·      Create a compelling offering through a knowledge-based model underpinned by its evolving portfolio of world class digital products and services;

·      Promote a stronger Wilmington brand to bring together its market leading positions and brands. This will better inform its clients about its range of expertise and breadth of coverage which will in turn enhance its market positions in the UK and drive further international expansion; and

·      Develop an integrated organisation supported by best in class technology and exceptional talent.

Pedro Ros, CEO of Wilmington commented: 

"Over the last three years, Wilmington has focused on delivering margin and profit improvement. As we move forward, we are determined also to deliver significant organic revenue growth, supplemented by selective acquisitions.

Our strategy for growth is based on a strong and differentiated portfolio of offerings and is founded on core competencies in key existing and adjacent markets; domestic and international. Central to this will be the establishment of a new Wilmington portal which will become the nucleus of our digital hub. Wilmington will continue to invest in talent and technology so that our clients will benefit from a consistent best in class Wilmington experience.

The changes outlined today underpin our ambitions and the Board and our management team are excited about the opportunities to drive the business to the next stage of its development."

Wilmington's strategic focus will be to develop further the following four core areas of expertise:

-     Risk & Compliance (36% of revenue*, 49% of contribution*);

-     Finance (19% of revenue*, 17%* of contribution*);

-     Legal (19% of revenue*, 10% of contribution*); and

-     Insight (26% of revenue*, 24% of contribution*).

Enhanced growth under a knowledge-based model

Wilmington has long-standing and proven expertise in the finance and legal areas combined with strong and trusted understanding of regulation and compliance issues in the banking, insurance and pension industries. This combination provides a strong platform for building on the Wilmington brand as a partner of choice for its clients' needs for Risk & Compliance, Finance and Legal. Wilmington sees the potential for robust organic growth as companies are faced with increasingly complex and regularly updated legislation and regulation as well as increased demand for transparency.

Insight also represents an area with opportunities to strengthen Wilmington's offerings through innovation and adding more value to its clients by providing unique specialist and actionable information. Here Wilmington provides analysis and clarity to customer-focused organisations, enabling them to better understand and connect with their customers. Wilmington will also look to leverage this expertise in these areas into other markets and other knowledge areas in the future.

The Group will leverage its common platforms and expertise that underpin all of its businesses and further develop its international footprint. It is anticipated that the investment in a new Wilmington Portal and the costs involved in the implementation of the strategy will be up to £1.0m and this will be incurred as a one-off during the current financial year. This investment will be in addition and complementary to the existing investments in the new CRM systems, Salesforce©, and the further development of our shared service platform announced previously.

Over the coming months, Wilmington will finalise its operational plans including the development and launch of its new integrated digital hub which will over time host and become the entry point and resource centre for all Wilmington clients. We intend to provide a more detailed expose of the strategy and vision at the time of our half year results at the end of February 2015.

For further information, please contact:

Wilmington Group plc	020 7422 6800
Pedro Ros, Chief Executive Tony Foye, Chief Finance Officer
FTI Consulting	020 3727 1000
Charles Palmer / Emma Appleton

Notes

As explained above, the business will be re-aligned across its four core areas of expertise.

Risk & Compliance:This division is Wilmington's fastest growing and higher margin business and includes its compliance, insurance and pension businesses. The initial emphasis will be to continue to develop existing market leading products and services across existing industries and into new territories. In this area, we anticipate strong revenue and profit growth as well as opportunities for selective acquisitions.

Finance: This division includes Wilmington's financial training businesses. The consolidated offerings of its Finance areas should drive good revenue growth as well as exploit growing international markets.

Legal: The objective will be to focus on the improvement of operating margin over the medium term. To do this Wilmington intends to fully integrate its legal training and information businesses as well as become the main networking platform for the law industry.

Insight: This incorporates the healthcare and business intelligence businesses. We will add value to the information and services already provided and we will continue to invest in innovation, technology and talent.

Wilmington restates below its historical performance to reflect the new structure.

* Percentages based on the four new divisions Unaudited Revenue and Contribution to Adjusted EBITA expressed as a percentage of Audited Revenue and Audited Adjusted EBITA (after adding back unallocated central overheads of £3,266,000 (2014) and £3,119,000 (2013)) as per the Audited Results for the year to 30 June 2014.

	Revenue				Adjusted EBITA				Margin
	2014 £'000	2013 £'000	%		2014 £'000	2013 £'000	%		2014 %	2013 %
Risk & Compliance	32,354	25,210	28		10,669	8,109	32		33	32
Finance	17,034	16,566	3		3,715	3,632	2		22	22
Legal	17,371	19,266	(10)		2,268	2,884	(21)		13	15
Insight	23,265	24,006	(3)		5,318	5,359	(1)		23	22
Unallocated central overheads					(3,266)	(3,119)
	90,024	85,048	6		18,704	16,865	11		21	20

Reconciliation  2014
	Revenue £'000		Risk & Compliance £'000	Finance £'000	Legal £'000	Insight £'000
Pensions & Insurance	17,006		17,006
Banking & Compliance	21,938		15,348	6,590
Healthcare	13,684					13,684
Legal	17,371				17,371
Business Intelligence	9,581					9,581
Accountancy	10,444			10,444
	90,024		32,354	17,034	17,371	23,265
As % of revenue			36	19	19	26
Reconciliation  2014
	Adjusted EBITA £'000		Risk & Compliance £'000	Finance £'000	Legal £'000	Insight £'000
Pensions & Insurance	6,765		6,765
Banking & Compliance	5,543		3,904	1,639
Healthcare	2,818					2,818
Legal	2,268				2,268
Business Intelligence	2,500					2,500
Accountancy	2,076			2,076
Contribution	21,970		10,669	3,715	2,268	5,318
As % of Contribution			49	17	10	24
Unallocated central overheads	(3,266)
Adjusted EBITA	18,704
Reconciliation  2013
	Revenue £'000		Risk & Compliance £'000	Finance £'000	Legal £'000	Insight £'000
Pensions & Insurance	14,629		14,629
Banking & Compliance	16,566		10,581	5,985
Healthcare	13,058					13,058
Legal	19,266				19,266
Business Intelligence	10,948					10,948
Accountancy	10,581			10,581
	85,048		25,210	16,566	19,266	24,006
As % of revenue			30	19	23	28
Reconciliation  2013
	Adjusted EBITA £'000		Risk & Compliance £'000	Finance £'000	Legal £'000	Insight £'000
Pensions & Insurance	6,093		6,093
Banking & Compliance	3,513		2,016	1,497
Healthcare	2,836					2,836
Legal	2,884				2,884
Business Intelligence	2,523					2,523
Accountancy	2,135			2,135
Contribution	19,984		8,109	3,632	2,884	5,359
As % of Contribution			41	18	14	27
Unallocated central overheads	(3,119)
Adjusted EBITA	16,865

This information is provided by RNS

The company news service from the London Stock Exchange

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