Consolidated Group revenue rose to EUR 430m EUR 400m revenue of Messe Düsseldorf GmbH exceeds plan Expansion of international portfolio Strong involvement in India as a future market Go-ahead was given for the replacement of the South Entrance and Hall 1
All figures are subject to final accounts
In 2016 the Messe Düsseldorf Group maintained its robust position as the most prof-itable European trade fair company with its own premises. In a year with a large number of cyclical events the Group as a whole made around EUR 430m in revenue (previous year: EUR 302m). Messe Düsseldorf GmbH’s revenue was around 5% above plan, totalling EUR 400m (previous year: approx. EUR 243m). Of this figure around EUR 33m was generated internationally (previous year: EUR 40m). The GmbH’s annual post-tax results for 2016 were around EUR 65m (previous year: EUR 31m). Plans for 2017 include dividends of up to EUR 6.5m. The final amount will be decided by the committees in the second quarter of 2017 when the year-end results are finalised.
The operational international business of the Group temporarily dropped to EUR 63m (previous year: EUR 100m), due to the sale of Brno Trade Fairs and Exhibitions and the continually difficult economic situation in Russia as well as the slowdown of growth in China. “Thanks to the strategic development of our international event portfolio, we were still able to achieve more than 30% of Group revenue outside Germany in 2015,” says Werner M. Dornscheidt, Chief Executive Officer of Messe Düsseldorf GmbH. “This is a level which we’ll need to reach again over the next few years and then gradually increase through our corporate strategy ‘Messe Düsseldorf 2030’,” says the head of the Düsseldorf Exhibition Centre. “This is the only way we can compensate for cyclical sales fluctuations in Germany and ensure that our Group keeps growing in revenue.”
The Group has now laid the foundation for its worldwide expansion strategy by focusing both the organisation and content of its international business on four global portfolios under the brands of the major leading global trade fairs in Düsseldorf. “Thanks to cross-border synergies, exhibitors and visitors will benefit even more from our global industry expertise and our local market knowledge.” Dornscheidt sees a further guarantee of success in the expansion of international sales activities into future markets such as India, Algeria and Iran. To ensure the speedy development of regions with major economic growth, the international expert uses the expertise of his global network and collaborates with local suppliers.
Russia remains Messe Düsseldorf’s international market with highest revenue Strategic expansion of the global portfolio focuses on future markets
Of the EUR 63 million achieved by the Group internationally in 2016, EUR 25 million was made in Russia, EUR 15.5 million in China, EUR 6.5 million in Singapore and EUR 4.3 million in the USA. In total, the Messe Düsseldorf Group realised 63 proprietary and joint events outside Germany. 55 events are planned for 2017.
Russia continues to be the best-selling international market both for the Group and for the GmbH, despite the country’s crisis. This is where the GmbH generated 58% of its international revenue. Other important markets were China with 14% of the international revenue share and India with 8%. India, in particular, has one of the world’s most rapidly expanding national economies, and Messe Düsseldorf is therefore steadily stepping up its presence in India, with new events. In 2016 the new FoodPex India supplemented the existing International PackTech India which will be replaced in 2017 by the redeveloped pacprocess INDIA. 2017 will also see the premières of several further trade fairs on the Indian subcontinent: Running in paral-lel with glasspex India in New Delhi, the new glasspro INDIA will open its gates in February, followed a few days later by the new health and safety trade fair INOS+H Expo. Everything is set for international growth. “The aim is to support trade fair cus-tomers as widely and as globally as possible,” says Dornscheidt. “At the same time we want to step up our worldwide presence and thus increase the proportion of in-ternational exhibitors and visitors at our leading global trade fairs in Düsseldorf.”
The 2016 financial year: Leading global trade fairs in Düsseldorf ensure reve-nue through a high level of internationalism
The Group’s strategy has been vindicated by success at its home base in Düsseldorf. As before, the share of international exhibitors in Düsseldorf’s proprietary events was extremely high in 2016, averaging 70.5% (previous events: 29.8%). This high level of internationalism was especially noticeable at ProWein (84%) and MEDICA (77%). In the same way, the proportion of international visitors rose to an average of 42% (previous events: 39.3%). The highest rates were achieved by drupa with 75% and glasstec with 70% international visitors. “Düsseldorf’s leading global trade fairs represent a high level of internationalism,” says Dornscheidt, “and this is appreciated by the decision-makers in the various industries.” He goes on to say that it has had a major impact on the quality of the visitors who come to the various trade fairs. “At drupa, for instance, around 75% of all visitors were executives with a major hand in the investment decisions of their companies.”
The biggest revenue drivers last year were the number one events drupa, K, MEDICA, boot, ProWein, wire and Tube. In total, 31 events (previous year: 29) were held at the Düsseldorf Exhibition Centre in 2016, of which 19 were proprietary events and 12 partner or guest events. Around 32,100 exhibitors and 1.6 million visitors came to trade fairs in Düsseldorf, confirming the relevance of trade fairs as marketing tools.
Trade fairs are today’s meeting points in global business
The increasing internationalism of Düsseldorf’s leading global trade fairs reflects an enormous change in the trade fair sector over the last 15 to 20 years. On the one hand, the sector has developed into an industry which operates on all continents and organises trade fair themes on a global scale where the leading trade fairs in each industry turn more and more into meeting places for globalised business.
On the other hand, trade fairs, too, have changed in character. The leading trade fairs in the relevant industries have long turned into venues of international knowledge transfer where all stakeholders exchange ideas, whether they are research institutions, start-ups or global multinationals. “Logically, therefore, we have continued the development of our globalisation activities to become our strategy
‘Messe Düsseldorf 2030’. It clearly puts the focus of our entrepreneurial activities on expanding our global portfolio and on strengthening our international marketing. And what is particularly important for us,” says Dornscheidt, “is the qualitative develop-ment of our leading global trade fairs in Düsseldorf.”
The development of trade fair content has also been impacted by the increasing digitisation of all economic sectors and spheres of life. Dornscheidt sees this both as a challenge and as an opportunity for the trade fair industry. “The digital transformation affects us as an enterprise just as much as it does our customers, particularly those in mechanical engineering. This is where we are providing additional services. For us, however, it also reinforces the very core of a ‘trade fair’ as a place where people meet and exchange ideas.
Go-ahead for replacement of South Entrance and Hall 1
One integral part of the general business idea is a masterplan for the modernisation of the exhibition centre which comprises all the halls and conference rooms throughout the centre. The robust annual results of 2016 provide a financial basis for this development. Like in previous years, most of the operating cash flow was used for the modernisation of the Düsseldorf Exhibition Centre. In fact, by the end of 2016 Messe Düsseldorf had completely redeveloped or modernised 11 out of 19 halls. The replacement of Hall 1 (currently Halls 1 and 2) will be tackled after interpack 2017. The go-ahead has also been given for the redevelopment of CCD Süd. By placing a new and highly modern South Entrance directly next to the River Rhine, Messe Düsseldorf is setting a powerful architectural sign in a prominent place, creating a high functional standard. Messe Düsseldorf is planning to complete the redevelopment of the exhibition centre by 2030. The money that has been earmarked for investment in new buildings and redevelopment is around EUR 636 million. All investments are generated from Messe Düsseldorf’s own resources.
Outlook for 2017
“We increased our 2016 results through a convincing cost management policy and by working without subsidies. So we are very pleased,” says Werner Dornscheidt. In 2017 Messe Düsseldorf GmbH is expecting EUR 300 million in revenue. As before, the positive operating cash flow in 2017 will permit the continued optimisation of premises and the replacement of buildings.
The further development and repositioning of leading global trade fairs at the home base has proved its worth. This is particularly borne out by drupa with its focus on forward-looking future technologies such as 3D and functional printing. 2017 will be dominated clearly by one particular leading global trade fair – interpack (4-10 May 2017). Throughout the world there is no other trade fair in the industry that maps the entire value chain, covering specially tailored solutions and innovative ideas for all sectors – including food, beverages, confectionery and baked goods, pharmaceuticals, cosmetics, non-food and industrial goods. The interpack alliance label comprises all international events in packaging and processing. It does so by focusing on greater visibility and positioning itself under a single globalised and comprehensive brand strategy. interpack is now sold out, expecting around 2,700 exhibitors and 170,000 visitors.
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The Messe Düsseldorf Group*:
With a turnover of around EUR 430m in 2016, the Messe Düsseldorf Group maintained its position as one of Germany's most successful trade fair companies. 32,100 exhibitors presented their prod-ucts to 1.6m trade visitors at events in Düsseldorf this year. They were joined by half a million visi-tors to various conventions. About 50 trade fairs were held in Düsseldorf, including 24 global leaders in five areas of expertise: machinery, plants and equipment, trade and services, medicine and healthcare, fashion and lifestyle, and also leisure. In addition, there were about 70 proprietary, joint and contracted events outside Germany, demonstrating that the Messe Düsseldorf Group is a lead-ing global platform for export. Messe Düsseldorf GmbH is the trade fair company with the highest level of internationalism in capital goods exhibitions. In 2016 Messe Düsseldorf's proprietary events in machinery, plants and equipment had approx. 72 per cent international exhibitors and attracted 58 per cent trade visitors from other countries. In all, Düsseldorf trade fairs were attended by customers from about 180 countries. The Group runs a global network of sales offices in 132 countries (71 international representations) as well as competence centres in 8 countries.