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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Euromoney Institutional Investor Plc | LSE:ERM | London | Ordinary Share | GB0006886666 | ORD 0.25P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 1,460.00 | 1,458.00 | 1,460.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMERM
RNS Number : 1043A
Euromoney Institutional InvestorPLC
21 December 2017
EUROMONEY INSTITUTIONAL INVESTOR PLC
ANNUAL REPORT AND ACCOUNTS 2017 AND
NOTICE OF 2018 ANNUAL GENERAL MEETING
Euromoney Institutional Investor PLC has today published the following documents on its website www.euromoneyplc.com:
Document Location --------------------------- ----------------------------------------------------------------------------- Annual Report and Accounts www.euromoneyplc.com/investor-relations/reports-and-presentations 2017 --------------------------- ----------------------------------------------------------------------------- Notice of Annual General www.euromoneyplc.com/investor-relations/shareholder-services/agm-information Meeting 2018 --------------------------- -----------------------------------------------------------------------------
The printed Annual Report and Accounts were posted to those shareholders who have requested them on Thursday 21 December 2017, together with the circular incorporating the Notice of Annual General Meeting and Form of Proxy. These documents and web default letter (for those shareholders opting for electronic communications) have been uploaded to the UK Listing Authority's National Storage Mechanism and will be available in two business days.
The information below is provided solely for the purpose of complying with DTR 6.3.5 and is not a substitute for reading the full Annual Report and Accounts.
As required by DTR 6.3.5 (1), we set out below the Directors' responsibilities statement contained within the Annual Report as follows:
Directors' Responsibility Statement
"Each of the Directors confirm that to the best of their knowledge:
-- the Group financial statements, which have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit of the Group; and
-- the Strategic Report and the Directors' Report include a fair review of the development and performance of the business and the position of the Group, together with a description of the principal risks and uncertainties that it faces."
Principal risks and uncertainties
The principal risks and uncertainties the Group faces vary across its different businesses and are identified in the risk register. Management of significant risk is the responsibility of the Board and is overseen by the Risk Committee. The Risk Committee changed its terms of reference during the year both to reflect market practice and to introduce an express requirement for the Committee to focus on the management of risk, as well as the identification and reporting of risk. The membership of the Committee changed during the year with the General Counsel & Company Secretary and Chief Information Officer joining the Committee.
The Group's principal risks and uncertainties are summarised below. The arrows indicate the change in level of perceived risk compared to last year.
Downturn in key geographic region or market sector (cyclical downturn)
Hot Features
Premium
Key factors Mitigation Risk appetite
Risk tolerant
Prior years
(relative
position)
2016: Risk
tolerant
2015: Risk
tolerant
2014: Risk
tolerant
Post-mitigation
risk trend
This risk is
increasing
Description of
risk
change
Global economic
and
geopolitical
uncertainty is
increasing
following the
US
election,
limited
progress of
Brexit
negotiations
and
disruption in a
sector with
concentrated
Group revenues
* The Group actively manages cyclical risk through its
strategic framework
* Concentration of customers in financial services * A comprehensive risk review by the Group of its asset
sector makes this exposure acute management businesses resulting in output including
detailed mitigation plans for each business and
continuous tracking of effective risk management
* Economic or geopolitical uncertainty increases this
risk
* The Group operates in many geographical markets
* The asset management sector faces significant
structural headwinds such as the shift from active to * Some diversification in sector mix
passive portfolio management, new technologies and
the uncertain impact of new regulation (MiFID II)
* Ability to cut some costs temporarily and quickly
* Brexit continues to create uncertainty for the UK and
European markets * Events can be switched to better performing regions
Board's view
The Board wishes to continue to serve the asset management segment because it considers it to be attractive over the medium term. There are limited options to mitigate impact in the short and medium term from a significant cyclical downturn. The residual risk will remain high.
Product and market transformation/disruption (structural change)
Key factors Mitigation Risk appetite
Risk tolerant
Prior years
(relative
position)
2016: Risk
tolerant
2015: Risk
tolerant
2014: Risk
tolerant
Post-
mitigation
risk trend
This risk is
unchanged
Description of
risk
change
As an
entrepreneurial
business, the
Group
is experienced
at
managing this
risk.
* Competition from existing competitors, new disruptive
players and new entrants
* Strategy designed to appraise and evaluate structural
* New technologies change how customers access and use risks and respond to them, taking advantage of
our products opportunities where identified
* Changing demographics can affect customer needs and * Regular CEO-led reviews across all divisions
opportunities
* Entrepreneurial approach
* Structural pressure on customer business models will
affect demand for the Group's products and services
particularly in financial services * Effective management reporting with regular budget
reviews
* New regulations such as MiFID II creating both
challenges and opportunities in asset management * Portfolio spreads risk to some degree
sector
* Third of Group's profits remain event-based
* Free content available via the Internet increases the
threat to paid subscription model
* Portfolio management allows the Group to sell
structurally challenged businesses and to buy
* Lower barriers to entry for new entrants structurally strong ones
* Inability to acquire the types of assets that the * Introduction of a cyclical review of divisional
Group's strategy requires activities by the Risk Committee
Board's view
High-quality controls are in place but exposure to this risk cannot be entirely mitigated.
Exposure to US dollar exchange rate
Key factors Mitigation Risk appetite
Risk tolerant
Prior years
(relative
position)
2016: Risk
tolerant
2015: Risk
tolerant
2014: Risk
tolerant
Post-mitigation
risk trend
This risk is
unchanged
Description of
risk
change
* Approximately three-quarters of revenues and profits The Group is
are generated in US dollars, including approximately * US dollar forward contracts are used to hedge 80% of experienced
30% of the revenues in its UK-based businesses. This UK based US dollar revenues for the coming 12 months at managing
gives significant exposure to movements in the US and 50% of these revenues for a further six months risks
dollar for both UK revenues and the translation of related to its
results of foreign subsidiaries exposure
* Exposure from the translation of US to the US
dollar-denominated earnings is not directly hedged dollar
* A significant strengthening of sterling against the but is partially offset by US dollar costs and the and this risk
US dollar could reduce profits and dividends use of US dollar-denominated debt remains
unchanged
* The Group also undertakes transactions in many other * Sensitivity analysis is performed regularly to assess
currencies, although none currently provides a the impact of currency risk, and is reviewed by the
significant risk to the results Tax & Treasury Committee
Board's view
The risk to revenue and profit resulting from a depreciation of the US dollar against sterling has previously been reported within risks from treasury operations. Although the Group considers this risk unchanged, the increased volatility and uncertainty of sterling after Brexit, as well as the US dollar following the US election, is expected to continue for some time.
Information security breach resulting in challenge to data integrity
Key factors Mitigation Risk appetite
Risk averse
Prior years
(relative
position)
2016: Risk
averse
2015: Risk
averse
2014: Risk
neutral
Post-mitigation
risk trend
This risk is
increasing
Description of
risk
change
Most industry
information
security
analysts
report that
this
risk is
increasing
and warn that
companies
will continue
to
face more
regular
and
sophisticated
cyber-attacks.
* Governance provided by Risk Committee and Information
Security Steering Group
* New information security standards and policies which
are reviewed on a regular basis
* Active information security programme (including
access management and cyber-resilience planning) to
align all parts of the Group with its information
security standards
* Crisis management and business continuity framework
covers all businesses including disaster recovery
planning for IT systems
* IT controls including firewalls and intrusion
* Integrity of data products is fundamental to the detection software
success of the business
* Access to key systems and data is restricted,
* The Group relies on large quantities of data monitored and logged with auditable data trails in
including customer, employee and commercial data place
* Increasing number of cyber-attacks affecting * Comprehensive backups for IT infrastructure, systems
organisations globally and business data
* The Group has many websites and is reliant on * Creation of Group Chief Information Officer role and
distributed technology, increasing exposure to appointment of expert individual into role with
threats responsibility for and oversight of both central and
divisional technology functions
* A successful cyber-attack could cause considerable
disruption to business operations, lost revenue, * Professional indemnity insurance provides cover for
regulatory fines and reputational damage cyber risks including cyber-attack and data breach
incidents
* The new EU General Data Protection Regulation will
increase regulatory scrutiny and penalties * Information security is reviewed as part of our
internal audit process
* Technological innovations in mobile working,
cloud-based technologies and social media introduce * Annual information security training for employees
new information security risks and freelancers
Board's view
Controls to prevent an information security breach or cyber-attack are regularly enhanced. However, the rising number of cyber-attacks affecting organisations globally, the Group's greater dependency on technology and the growing threat from cyber-crime are increasing this risk.
Reputational damage from a legal, regulatory or behavioural issue arising from operational activities
Key factors Mitigation Risk appetite
Risk averse
Prior years
(relative
position)
2016: Risk
averse
2015: Risk
averse
2014: Risk
averse
Post-mitigation
risk trend
This risk is
unchanged
Description of
risk
change
* Processes and methodologies for assessing commodity Information
prices and calculating benchmarks and indices are providers
clearly defined and documented face increased
compliance
risks as a
* Compliance staff appointed in key positions result
of the
complexity
* Compliance with International Organization of of data they
Securities Commissions (IOSCO) standards achieved for publish
relevant pricing products which customers
may rely on for
certain
* Code of conduct and other key policies in place for business
price assessment, benchmark and index reporting decisions
* The Group operates in many jurisdictions and must be activities
compliant with all applicable laws and regulations
* Updated publishing law guide to be issued to
* The Group's businesses publish, market and license editorial staff in 2018
increasingly complex content and data which in some
cases is data on which its customers may choose to
rely when executing transactions * Refreshed anti-bribery and corruption training and
awareness programme to be rolled out globally in 2018
* Claimants can forum shop when determining where to
litigate or threaten legal proceedings * Review processes for operation of events and awards
* Success of the Group is dependent on client * Specialist training provided to relevant staff
confidence in integrity of products and brands
* New technology being introduced to provide enhanced
* Compliance risk increasing for information providers monitoring and better exception reporting
as price, benchmark and index reporting activities
are coming into scope of new regulations being
introduced as a result of the financial crisis of * Company-wide speak up policy in place
2008 and LIBOR scandal
* Comprehensive legal disclaimers in place
* Risk or reputational damage can arise from errors in
underlying data or content, failures of data
integrity, failure to educate customers on * Professional indemnity insurance
appropriate usage of data, inappropriate reliance on
third party data or content to create proprietary
content or errors in content creation or a failure to * Risk and compliance role recruited in Price Reporting
comply with applicable law or regulation and Events divisions
Board's view
The publication of data and content in digital businesses inevitably exposes the Group to global legal and regulatory risk. The manner in which we conduct our businesses can also result in risk if policies are not complied with. The business has invested in its central functions such as legal, risk and internal audit, which provide more specialist resource to raise awareness of, manage and mitigate risk. Legal and regulatory compliance risk for the Group is unchanged.
Disruption to business operations
Key factors Mitigation Risk appetite
Risk averse
Prior years
(relative
position)
2016: Risk
averse
2015: Risk
averse
2014: Risk
averse
Post-mitigation
risk trend
This risk is
unchanged
Description of
risk
change
* Significant reliance on third-party technology The Group
hosting services recognises
that business
* Crisis management and business continuity framework continuity
* Many products are dependent on specialist, technical covers all businesses including disaster recovery events will
and editorial expertise planning for IT systems arise
from time to
time
* A significant incident affecting one or more of the * Group-wide ITDR testing conducted every six months and remains
Company's key offices (London, New York, Montreal, committed
Hong Kong or Sofia) could lead to disruption to Group to active
operations and reputational damage * Clear responsibilities for business continuity management
planning established across divisions of this risk
* Divisional structure with 40+ international offices
makes regular testing of plans across the Group * Substantial central and business group investment in
challenging cloud based platforms and software
* Global distribution of property and staff creates * Risk assessments for new suppliers and technologies
exposure in many geographical locations consider operational and financial resilience
Board's view
Business disruption is an unavoidable risk but can be mitigated if business continuity plans are well developed and managed. In spite of extreme weather in Asia and the US, and a number of system failures, all businesses maintained operations successfully throughout, which demonstrated that effective controls are in place. However, more regular business continuity planning is required.
Catastrophic or high impact risk affecting key events or wider business
Key factors Mitigation Risk appetite
Risk averse
Prior years
(relative
position)
2016: Risk
averse
2015: Risk
averse
2014: Risk
neutral
Post-mitigation
risk trend
This risk is
increasing
Description of
risk
change
The Group
recognises
that
international
events
businesses
are exposed to
this
risk
* The Group has a number of large events which are
exposed to one-off risks including natural hazards * Crisis management and business continuity framework
and security incidents requires all businesses to plan for high impact
events
* Risk affects customers as well as staff and revenue
* Specialist security and medical assistance services
engaged to support all staff working away from the
* Prolonged interruption to business travel will harm office
event revenues and disrupt management and sales
operations
* New event venue risk assessment process was
introduced in 2017
* Past incidents such as hurricanes, terrorist attacks
,
SARS, Ebola and Zika virus, and events such as the * Mandatory security and risk management training
disruption to airline schedules from volcanic ash in programme for event staff and business travellers
Europe, have all had a negative impact on the Group'
s
results, although none materially * With sufficient notice, events can be moved to
non-affected regions
* The Group operates in regions with higher risk of
natural hazards * Cancellation insurance for the Group's largest events
Board's view
The Group continues to invest in training and resources to keep staff safe when travelling and to improve event/conference resilience.
Acquisition or disposal fails to generate expected returns
Key factors Mitigation Risk appetite
Risk neutral:
becoming
more tolerant
Prior years
(relative
position)
2016: Risk
neutral
2015: Risk
neutral
2014: Risk
neutral
Post-mitigation
risk trend
This risk is
increasing
Description of
risk
change
See Board's
view.
* Active portfolio management with a clear framework
* Active portfolio management means the Group continues and operating in line with agreed strategy
to make strategic acquisitions and disposals
* Development of key objective criteria against which
* Significant growth has been M&A related, through both acquisition or disposal decisions are tested
acquired profit and growth in acquired businesses
* Board and CEO focus on investment and divestment
* Failure to integrate may mean an acquired business plans. Formal reviews and approvals in place
does not generate the expected returns
* Senior head of Corporate Development in place
* Risk of impairment loss if an acquired business does recently supplemented by additional industry hire
not generate the expected returns with both subject matter and industry expertise
* Disposal risks arise from failing to identify the * Investment in external, independent commercial due
time at which businesses should be sold or failing to diligence
achieve optimal price
* The Group has developed a rigorous framework to
* Group strategy relies on successful recycling of manage the integration, planning and ownership of n
capital and therefore M&A execution impacts core ew
strategy acquisitions
Board's view
This risk will increase given the Group's strategy of increased M&A and portfolio management.
Unforeseen tax liabilities or losses from treasury operations
Key factors Mitigation Risk appetite
Risk averse
Prior years
(relative
position)
2016: Risk
averse
2015: Risk
averse
2014: Risk
averse
Post-mitigation
risk trend
This risk is
unchanged
Description of
risk
change
The Group is
experienced
at managing tax
and treasury
risks
arising from
its
international
business
portfolio and
this
risk remains
unchanged
* Audit Committee and Tax & Treasury Committee
oversight
* Tax and treasury advice provided by a mix of external
tax experts and in-house specialists
* We have a policy to comply with tax laws in a
responsible manner and have open and constructive
relationships with tax authorities
* We take appropriate care to protect the Group's
reputation and relationship with fiscal authorities
* We take regulatory and commercial constraints into
account when taking steps to mitigate tax exposure
* The Group operates within many increasingly complex * Derivatives are used to hedge market risks including
tax jurisdictions exchange rates and interest rates
* Counterparty risk if a bank fails * Appropriate policies define segregation of duties and
strict authorisation limits
* Cash and working capital requirements for multiple
overseas locations mean some debt is always exposed * Internal audit programme covers tax and treasury
to exchange rate movements controls
Board's view
Effective controls are in place but the group cannot eliminate this risk entirely due to the complexity of the group's structure and the number of jurisdictions in which it operates.
Failure to implement the strategy effectively due to a loss of key staff
Key factors Mitigation Risk appetite
This is a new
risk
Post-mitigation
risk trend
This risk is
increasing
Description of
risk
change
N/A
* Ensuring compensation is competitive
* Ensuring compensation for critical staff includes a
balance of short-term and long-term incentives
* Investment in training and developing our staff in
critical roles will be a focus in 2018
* Maintaining the Group's reputation for enabling an
* In 2016 the Group announced a new strategy which has entrepreneurial approach, making the Company an
become embedded across the Group and is having a attractive place to work
positive impact on financial performance
* There are sufficient businesses within each segment
* Our segments and divisions have individual strategies and segments within the Group to mitigate the impact
of 'business- as-usual' departures of critical staff
* Implementation of strategy is dependent on the
performance of staff in critical roles * Succession plans are being developed but this work
needs to accelerate
* An inability to recruit, retain and train for
critical roles will adversely impact our ability to * Contractual notice periods are designed to manage the
deliver the strategy successfully risk of critical staff leaving on short notice
Board's view
The Board recognises the importance of retaining critical staff to ensure effective delivery of Group, segmental and divisional strategies. A range of controls are used to manage this risk effectively, although succession planning needs to accelerate.
The other information required by DTR 6.3.5 (1) was contained within the unaudited preliminary announcement of Euromoney Institutional Investor PLC's results for the year ended 30 September 2017, released to the market in unedited full text on Wednesday 22 November 2017.
ENDS
For further information, please contact:
Euromoney Institutional Investor PLC
-- Colin Jones, Finance Director: +44 20 7779 8666; cjones@euromoneyplc.com
-- Tim Bratton, General Counsel & Company Secretary: +44 20 7779 8288; tim.bratton@euromoneyplc.com
NOTE TO EDITORS
About Euromoney
Euromoney Institutional Investor PLC is listed on the London Stock Exchange and is a member of the FTSE 250 share index. It is an international business-information group covering asset management, price discovery, data & market intelligence, and banking & finance under brands including Euromoney, Institutional Investor, BCA Research, Ned Davis Research and Metal Bulletin. The group also runs an extensive portfolio of events for the telecoms, financial and commodities markets.
www.euromoneyplc.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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