RELX(RELX)2022-08-01 10:25Summary of RELX PLC H1 2022 Results Earnings Conference Call Company Overview - Company: RELX PLC (NYSE:RELX) - Date of Call: July 28, 2022 - Participants: Erik Engstrom (CEO), Nick Luff (CFO), various analysts from Barclays, UBS, Exane BNP Paribas, Goldman Sachs, Citigroup, Credit Suisse, and Bernstein Key Financial Highlights - Revenue Growth: 13% at constant currencies - Adjusted Operating Profit Growth: 16% at constant currencies - Adjusted Earnings Per Share Growth: 14% at constant currencies - Interim Dividend Increase: 10% to £0.157 per share - Total Group Revenue: Nearly £4 billion, up 17% in sterling - Adjusted Operating Margin: Improved to 31.2% [3][10][12][14] Business Area Performance Risk - Underlying Revenue Growth: 7%, with business services (45% of revenue) showing strong growth - Digital Identity Solutions: Grew around 20% with acquisitions enhancing customer value [4][10] - Profitability: Adjusted operating profit growth in line with revenue growth [10][13] Insurance - Revenue Contribution: Just under 40% of divisional total - Market Improvement: Gradual improvement in US auto insurance market factors [4][5][10] STM (Scientific, Technical, and Medical) - Revenue Growth: 4%, with adjusted operating profit growth at 6% - Open Access Articles: 40% growth in published articles [6][10][30] Legal - Revenue Growth: 4%, with adjusted operating profit growth at 6% - Electronic Revenue: Almost 90% of divisional total, driven by legal analytics [7][10] Exhibitions - Revenue Growth: Over 200%, driven by venue reopenings - Adjusted Operating Result: Positive due to increased activity levels and lower cost structure [8][10] Strategic Outlook - Future Expectations: Strong underlying revenue growth anticipated to align with historical trends across all business areas [5][17] - Focus on Digital Tools: Continued investment in digital tools to enhance physical events in exhibitions [8][41] Cash Flow and Capital Allocation - Cash Conversion: Strong at 103% - Acquisition Spend: £342 million on six acquisitions - Share Buyback: £300 million in the first half, with a total plan of £500 million for the year [10][16] Risks and Concerns - US Recession Impact: Potential exposure of transactional revenue to economic downturns, but historical resilience noted [23][25] - Inflationary Pressures: No immediate pricing impact observed, but potential for adjustments in 2023 [31][33] Analyst Questions and Responses - Growth Trajectory: Analysts inquired about the sustainability of growth rates in STM and Legal, with management affirming a positive outlook [19][20] - Insurance Market Factors: Recent improvements in driving patterns and claims volumes noted as positive indicators [35] - Exhibitions in China: Uncertainty remains, but flexibility in scheduling events is emphasized [37][41] Conclusion - Overall Performance: RELX PLC reported strong financial results for H1 2022, with positive growth across all business areas and a strategic focus on enhancing customer value through digital tools and acquisitions [17][18]