Event industry group GL events has announced first quarter group revenues of €213m, which represents a 37.3% drop over the same period last year.
The Exhibitions division was down over 67% at €42.8m for the quarter (2019: €132.3m).
The Live section of the business held up better, dropping just 8% on the 2019 Q1 figure of €124.2m to €11.4m, while the Venues business plunged 31.9% to €57.1m compared to €83.7m for Q1 2019.
Olivier Ginon (pictured), GL events Group's Chairman commented: “After the solid performances of the first two months and, under normal market conditions for March 2020, revenue in the 2020 first quarter would have reached nearly €320m, up 12% (at a comparable scope and biennial basis).
“However, in response to the evolving situation of the global health crisis and the administrative closures of event venues destined to receive the public, revenue for the first quarter registered a significant decline.
“In response to this pandemic, GL events has taken the necessary measures to protect the health and safety of its employees and stakeholders. The Group has also taken measures to preserve its financial resources which include a series of cost-savings measures and the cancellation of its dividend payment. These different actions, combined with the Group’s solid fundamentals and the measures that governments are adopting to support the tourism and event industry sectors will allow GL events to be prepared to rapidly resume its activities once the crisis has passed.”
The delivery of services for two events held in Saudi Arabia: the Dakar Rally in January and the Saudi Cup international horse race in February helped the Live division limit the damage on the bottom line, with ‘only’ a 8.7% drop on Q1 2019. The division also delivered services for recurring events: the Paris International Agricultural Show, fashion shows at Paris Fashion Week and the organisation of the Dassault Convention. In March, as a number of events were cancelled due to the health crisis, revenue declined significantly for this division, too, however.
GL Events Exhibitions took the biggest impact of the divisions, with the combined effect in this quarter of both an unfavourable biennial-based comparison base and the rescheduling of a number of exhibitions.
In China for example, exhibitions planned for the first quarter (China Building & Decoration 2020, China BWFE 2020, CIDE 2020) were all moved forward to June or the second half. In France, GL events also moved several events forward to later dates (CFIA Rennes, Made Paris, Bocuse d’Or Europe & Americas…).
The Group did, however, decide to postpone the Global Industrie exhibition, initially scheduled for March 2020 in Paris, to 2021 at Eurexpo Lyon.
As for GL events Venues, by the end of February 2020, the division’s main destinations (Lyon, Barcelona, Budapest, The Hague and Brazil) had registered improvements of €4m in relation to N-1. The quarter’s decline in revenue in relation to Q1 2019 was ultimately a result of the administrative closures decided, the Group said, by various governments starting in March 2020.
GL events is making available two halls of the exhibition centre of Rio de Janeiro to be transformed into a temporary hospital.
The Metz Exhibition Centre was used by health authorities to transfer patients by helicopter from the Grand Est region to Germany.
The Group is also responding to all demands by health authorities to deliver services needed to combat this pandemic.
To maintain profitability, the Group is implementing a cost reduction plan that it said would generate savings in the period of more than €40m. GL events also confimed the cancellation of its dividend and has postponed €60m in investments (capex and acquisitions).
The Group is also working with the delegating public authorities to “drastically reduce the operating costs of the exhibition and convention centres while they remain closed”.
In England, temporary medical structures will be installed by GL events to receive patients with Covid-19 and some customers have already ordered additional temporary storage facilities.
In South Africa and Patagonia, the Group is building temporary hospitals. Generally, the Group’s industrial activities (prefabricated buildings or temporary aluminium structures, etc.) are continuing.
In China, the Group’s activities have resumed and teams are now operational and fully focused on organising the upcoming exhibitions. Finally, GL events is developing an offering to address the specific needs in this context: a furniture and signage range, temporary installations within the framework of the national plan for ending the confinement period and adopting testing procedures, facilities management for organising public or private initiatives and has reinforced its digital packaging.
In light of the evolution of the Covid-19 pandemic, GL events says that, while it is premature to try to quantify the precise impacts of the crisis on its first half or full year results, the Group, nevertheless, expects that activity in the second quarter of 2020 will be significantly impacted.