Has the fast-growing international exhibitions organiser got what it takes to survive? Annabella Gabb finds out.
It is not often that you see a board of beaming faces in the pages of an annual report. However impressive the company's results and promising the prospects, its directors habitually gather their features into expressions calculated to convey a reassuring air of gravity and responsibility. But open the pages of exhibitions organiser Blenheim's 1990 report and the impression is quite the opposite. Granted, the company is celebrating its 10th anniversary, but are those broad smiles not just a touch unprofessional?
But perhaps Blenheim's directors have good reason to be smiling. Since its flotation on the Unlisted Securities Market in 1986, which valued the company at £5.8 million, Blenheim has grown in leaps and bounds. Having graduated to the main market in April of last year, it is now capitalised at close on £150 million. In the year to the end of August 1990 it recorded pre-tax profits up a spanking 222% to £21.3 million, on turnover up 250% to £88.8 million. In the four years up to the same date, earnings per share and dividends per share rose by eight and 10 times respectively - good news for a board which owns some 41% of the company's equity.
As a fast-growing, acquisitive business, Blenheim has done well to start the 1990s in such good shape. For many 1980s growth stars the closing years of the decade proved to be a graveyard into which over-ambitious organisations tripped and fell, surviving, if at all, as mere shadows of their former selves. Blenheim is a striking exception. The company now organises a total of 250 events in nine countries, in industry sectors ranging from building construction to hotel and catering and information technology. It is Europe's leading independent exhibitions organiser; and with shows in the UK, France, Germany, Switzerland, Italy, Spain and Belgium, it is well placed to exploit new opportunities in the single market. Across the Atlantic, Blenheim has laid the foundations for a similarly significant presence in the £5 billion American market. Says Chris Akers, European media analyst at Citicorp: "They have bought up the best on the European exhibitions scene. All have performed up to their demanding expectations. Of the £250 million or so that they have spent on acquisitions, probably only £5 million has been a bad investment."
Through the 1980s the proportion of the promotional budget spent on exhibitions worldwide rose steadily. According to a report published by the Exhibition Industry Federation last year, some 22 to 25% of all promotional expenditure in Germany goes on exhibitions. In France and the United States the comparable figures are between 11 and 14%. Britain lags behind at 6 to 7%, but spending on exhibitions here increased by half in the course of the past decade.
In all of its markets Blenheim looks set to benefit from the tendency among companies to focus marketing more specifically. While other media, such as television and magazines, reach a broader audience, the marketing message will in many cases be wasted. Exhibitions allow narrow targeting of likely buyers, at lower cost than most other forms of promotion.