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Pricing pressures to blame as GES sees profits halve

A rise in smaller exhibitions and an increase in health and safety regulations saw profit fall to £257k in 2016

Global Experience Specialists (GES) said pricing pressures were to blame after seeing pre-tax profit more than halve in 2016 to £257k.

The full service provider, which has its EMEA headquarters in Coventry, also blamed a rise in smaller niche exhibitions and an increase in health and safety regulations after pre-tax profit fell from £624k in 2015 to £257k last year.

That was despite an increase in turnover of £5.5m, from £68.4m in 2015 to £73.9m for the year ended 31 December 2016, according to accounts filed at Companies House.

The strategic report accompanying the accounts said: “The results of the company continue to develop in line with expectations.

“The market in which the company operates continues to be challenging as a result of continuous price pressure on core services in an extremely competitive market. Smaller niche exhibitions are being launched which generate smaller average exhibition revenues but still require the same level of management resource as a larger, more mature exhibition. Increased health and safety regulation also continues to provide significant challenges to the business.”

The report added that the 8 per cent increase in turnover came from increased revenue from existing clients and new business, “even though competition remains tough with pressure on pricing”.

It said: “There has also been a focus on upselling to exhibitors and expanding into overseas markets.”

Gross profit margin increased by 0.2 per cent on 2015 to 31 per cent in 2016, while capital spend fell by £1.4m to £0.8m in the same period. Cash held at bank increased by £0.8m year on year to £2.5m in 2016.

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