The global events organizing industry represents a significant and highly attractive business opportunity. This White Paper, a collaboration between the UK consultancy AMR International and DeSilva+Phillips, looks at trends in the events business that will drive continued activity in M&A and internal business development. Here is why the events industry is so attractive to financial and strategic buyers alike:
It is large – approximately $100 billion total revenue across the globe in 2007.
It is growing – at an average of 6.2% globally since 2003 – and is forecasted to grow through 2011 at a nominal CAGR of 5.5%. Some international growth rates will touch 20%.
The industry can provide sustained growth. The world’s leading exhibition organizer, Reed Exhibitions, reported a H1 2008 revenue improvement of 9% while operating profit grew 16%.
The industry is still highly fragmented. The world leader Reed Exhibitions holds no more than 7% share of the global market.
Due to its face-to-face nature, the event “medium” is highly defendable, and it has a high inherent resistance to lower-margin Internet versions such as webinars.
Profitable events are very profitable – with pre-tax margins often in the 20-30% range, and sometimes more than 40%.
Exhibitions have excellent cash flow characteristics, with booth space deposits often paid up to a year in advance.
Revenues have high integrity since exhibitor renewal rates typically are in the 65% to 85% range and sponsorship opportunities can sell out.