Trade show organizer Hyve is aiming to raise £126.6 million in order to address its debt and secure its future amid the challenges posed by the Covid-19 pandemic. Hyve, known for organizing events such as Pure London, Jacket Required, and Moda, has been significantly impacted by the global health crisis, resulting in the postponement of 48 events and the cancellation of 13 others. Consequently, the company is forecasting a revenue decrease of £80 million for the year ending in September, representing a 20% decline compared to the previous year.

To mitigate its financial difficulties, Hyve has announced a rights issue, underwritten by Numis, Barclays, and HSBC. The proposed issue involves offering nine new ordinary shares at 69p each for every 40 existing ordinary shares, representing a 68% discount to the closing price on Wednesday. In addition, the company plans to consolidate ten existing ordinary shares into one share, pending the issuance of new shares.

Following this announcement, shares in Hyve experienced a decline of 5.6% on Thursday morning. Investors reacted to news of the rights issue and the release of the company’s interim results for the first half of the year. During this period, revenue dropped from £107.8 million in 2019 to £96.3 million, primarily due to the implementation of international government restrictions aimed at curbing the spread of the virus. However, on a like-for-like basis, revenue saw a 1% increase. Hyve also reported a statutory loss before tax of £168.3 million, compared to a profit of £1.9 million in the previous year. The acquisition of US-based events Shoptalk and Groceryshop in December contributed to a rise in adjusted net debt from £108.9 million to £157.2 million.

Despite these challenges, Hyve’s CEO Mark Shashoua remains confident in the company’s ability to recover once lockdown measures are lifted. Shashoua stressed the significance of market-leading events as vital trading platforms for various industries and their role in revitalizing economies. Hyve is actively collaborating with its customers, government bodies, and industry organizations to facilitate the recovery. The company is also focusing on enhancing its omni-channel capabilities following the acquisition of Shoptalk and Groceryshop. While digital platforms cannot fully replace in-person events, they can complement them by providing year-round online activities that support customers and boost brand visibility.

Shashoua expressed optimism about Hyve’s future, acknowledging that the temporary government restrictions have had a severe impact. However, he believes these challenges are only temporary. With its strategy of building a portfolio of market-leading events and the investments made over the past three years, Hyve is well-positioned to navigate through the crisis and emerge stronger on the other side.

Useful links:
1. Hyve
2. Numis