Strong FY19 results Informa has reported strong FY19 results, with revenue of £2890m driven by 3.5% organic growth and EBITA £933m c.2% ahead of consensus. EPS at 51.3p, FCF of £722m and DPS of 23.5p were all also ahead and demonstrate the cash generative capacity of the group which underpins growing cash return potential. By division, Markets at 4.3% was broadly in-line, and the Taylor & Francis academic publishing division accelerated to 2.4% (with higher margins). Significant rescheduling progress On key aspects of the outlook, management initially noted that its 35% of subscription revenues continues to grow (Intelligence & academic publishing divisions), and that Markets saw good trading in the first 2 months. As of today, it has rescheduled 45 large events later in 2020 (representing £350m of revenue, or c.25% of division), as well as 70 smaller events with £50m of revenue (and is virtualising some small events) – whilst it has cancelled 13 events in 2020 with revenue of £25m (c.2% of division). Some cost mitigation The company notes that for the events running in 2020, the Markets division will incur incremental marketing / venue costs, albeit subject to the scope a) to use existing budgets and b) of insurance outcomes. No formal group guidance has been given, but may – for the moment – provide a degree of reassurance about the overall impact (ability to reschedule / insurance in place etc). Looking further out Looking out a year, Informa trades at 10x FY21E earnings (vs RELX at 17x) with a dividend yield nearing 5% – whilst we recognise the significant short-term headwinds in 2020, the eventual easing of virus concerns should allow the bulk of demand in the exhibitions business to return relatively robustly, restarting the process of delevering and underpinning cash returns.