As the post-covid recovery continues apace in trade shows, it is believed that negotiations are underway to acquire the privately-owned transport events specialist UKI. Although this has not been confirmed, it had been thought that RX (the former Reed Exhibitions) would pay £100-120mn (10-13x operating profit for 2023) for the UK company. RX too has not commented.
UKI Media & Events organizes 17 B2B exhibitions and publishes 13 magazines in transport technology. It was founded (and is still majority owned) by Tony Robinson who had been a sales director in B2B magazines which is where UKI started. But, despite consistently good margins and historically strong growth revenue, few UK media people know either the founder or much about his company. The all-action (motorsports and flying) entrepreneur seldom gives interviews.
The company, whose events are primarily in the UK and across Europe, are focused on car design and development, aviation and transportation. It was founded in 1991 as AutoIntermediates Ltd, before becoming UK & International Press. By 1997, it had moved into exhibitions. In 2000, it became UKIP and, in 2018, reverted to UKI after ‘UKIP’ was adopted by a fringe political group (the UK Independence Party).
Its most profitable brand is the 24-year-old Automotive Testing Expo, a multi-destination event which takes place annually in Stuttgart, Shanghai and Detroit; and every two years in Chenai and Seoul. Alongside the core exhibition are complementary events including Automotive Interiors, Global Automotive Components & Suppliers, Autonomous Vehicle Technology, and conferences. It also publishes the quarterly Automotive Testing Technology International, a 15k-circulation, 190-page quarterly print and digital magazine. Other major brands include: Meteorological Technology World, Passenger Terminal Expo, Professional Motor Sport, and Electric & Hybrid Marine World.
The events strategy saw Robinson following a well-trodden path to European venues, especially in Germany where the exhibition halls are high-quality, reasonably-priced and the local authority owners are considered especially welcoming. It all helps to explain how Europe’s largest economy is home to so many international exhibitions, despite the UK-domicile of organisers. The fact that the German automotive and engineering industries are also Europe’s largest is a bonus for UKI. Within 10 years of launching into exhibitions in 1997, they had become UKI’s main business but magazines remained a key part of the offering to advertisers and exhibitors.
But the company’s real success is down to its track record of developing technical exhibitions with great attention to the detail of providing on-site testing facilities, demonstrations and highly-rated conferences. As Robinson says: “I chose to specialise in Transportation and avoid merely developing products in multiple environments. This has enabled the company to develop considerable knowledge in our zone. We have also ignored growing through acquisition, instead developing organic launches from within.”
The founder has lived and breathed his business. Opening the 2023 Autonomous Vehicle Technology Expo Conference in Stuttgart this week, he said that autonomous vehicles had been a favourite subject for 30 years, since 1994 when he attended the Prometheus event in Paris and witnessed a Mercedes S-Class driving “fully autonomously” around the Boulevard Périphérique.
UKI’s profit this year is believed to be 35% up on 2022 when the founder had enthused in his statutory accounts: “A new requirement that has emerged from the shock of the last two years is the necessity to hold susbstantial cash reserves…I am particularly pleased that, despite refunding in excess of £3mn of advance payments during 2020-22, our cash holdings are currently at £19mn.”
| UKI Media & Events £mn | 2023** | 2022 | 2021 | 2020 | 2019 |
| Revenue | 30 | 26 | 8.5 | 8.6 | 32.6 |
| Op profit | 9 | 6.7 | — | (3.5) | 10.1 |
| Margin | 30% | 26% | — | — | 31% |
Some 69% of revenue comes from Continental Europe (mostly Germany) and only 14% from the UK.
Its revenue has been propelled by an extraordinary commitment to rewarding its sales people, one of whom says he had been earning a £12k basic salary (some years ago) but got 10% commission on all sales up to a target, 12.5% on all sales if he exceeded the target, and a corresponding jump to 15% beyond a super-target. The result was that – pre-covid – many UKI sales people had been earning more (some much more) than £300k year after year, not just for new exhibitions but also for repeated events which (you assume) might involve rather less sales effort: “I like to create an environment where, if I am making a lot of money, some of my key people should be enjoying the fruits of success as well. We do pay sales people what some may say are exotic amounts of money. I have always believed in big incentives and fabulous commission packages.”
Notably, the company’s filings even for 2022 show that the average remuneration per employee was £100k. It’s no surprise that UKI has plenty of 10-15 year employees; people seldom leave which is, perhaps, another reason why the industry at large doesn’t know much about the high-performing company.
Always the star sales director, Robinson has netted almost £30m in the last 16 years from divestments. In 2007, he sold the Aircraft Interiors Expo and related shows to Reed Exhibitions for £22.7m (10x EBITDA). In 2019, he sold 12 magazines to the Mark Allen Group for £6.2m (4x EBITDA).
UKI could be a great acquisition.
RX has so far spent some £300mn on acquisitions during the last eight years. Almost £220mn of that was for Mac Brooks in 2019. Its trading this year seems set to recover almost to pre-covid levels:
| RX £mn | 2023** | 2022 | 2021 | 2020 | 2019 | 2018 |
| Revenue | 1,100 | 953 | 534 | 362 | 1,269 | 1,219 |
| Op profit | 250 | 162 | 10 | (164) | 331 | 313 |
| Margin | 23% | 17% | —- | —- | 23% | 25% |
For the RELX subsidiary, the significance of a deal with UKI would be that the mainly European UKI portfolio would neatly complement its own automotive, transport and aeropspace events which are mostly in Asia; it would be a great fit. Moreover, UKI’s high-margin success in integrating publishing and digital content with events is in tune with RX’s own strategies and its heavy investment in tech and reduced operating costs.
But there’s more.
Whether or not UKI is sold, these are good times for exhibition companies to acquire rock-solid, market-leading trade shows just as they are getting back to their pre-covid best – but before deal multiples return to the heady 18-20x EBITDA they reached in 2019. That’s why Informa acquired Tarsus and why Hyve has been bought by Providence private equity.
There is inevitable speculation that Money 20/20 and/or Cannes Lions may yet be sold (rather than remaining as a UK listed company) as part of Ascential’s moves to IPO its digital commerce operations in the US and turn the £1bn listed company into £2-3bn of assets, whether retained or sold. It is assumed that the current auction of its WGSN forecasting platform may yet lead to divestment of the whole of Ascential, either in total or as two or three separate deals. Expect some news early in July.
Its Cannes Lions is preparing for a full-throated “normal” live return in France next week and would-be buyers of Ascential’s data-rich events business (£184mn revenue/ £72mn EBITDA in 2022) will have been motivated by the optimism of a recent investor briefing. They will also have been buoyed by this week’s upbeat Informa whose exhibitions have been its strongest performing sector in the first five months of the year.
Trade association UFI says global exhibition revenues in 2023 will reach 87% of 2019 or 94% excluding the late reopening China. But many companies – including the two largest, Informa and RX and also the pan-European €170mn-revenue EasyFairs – are expected to be well ahead of that. Right across the market, increasing numbers of events are reporting revenues back to pre-pandemic levels. The second-half of 2023 will be back to “normal” for the first time in four years and next year is likely to show all-round growth in revenue, profits and price multiples.
That strong tide of recovery may also mean that – for all the belief RELX may eventually divest its exhibitions division – the parent company is determined to help RX maximise its performance in a market of rich opportunities and rising values. It has said that RX will this year get back to its 23% profit margins from 2019. The longtime pioneer of global trade shows may just have a renewed determination to close a 25% revenue gap with Informa and fight to regain the market leadership it lost in 2018. Way to go.
