Profitability creates basis for worldwide growth - Messe Düsseldorf invests in digital transformation
- All figures are subject to final accounts -
Group achieves EUR 360m revenue in current financial year Revenue of Messe Düsseldorf GmbH above plan: EUR 330m Growing international business mitigates cyclical revenue fluctuations Digitisation offensive: ideal infrastructure and new services
In 2017 the Messe Düsseldorf Group maintained its robust position as one of the most profitable European trade fair companies with its own premises. After a record year in 2016 with the two number one events drupa and K, the Group has followed the usual cycle, displaying a decline in sales, down to EUR 360m (previous year: EUR 443m). Messe Düsseldorf GmbH’s target was exceeded by around nine per cent, so that the total GmbH revenue was EUR 330m (previous year: EUR 407m). Of this figure around EUR 35m was generated internationally (previous year: EUR 32m). The annual GmbH result after tax will be around EUR 30m (previous year: EUR 71m). A one-off special effect of EUR 4.5m results from the sale of shares in the Igedo Company. Plans for the 2017 financial year include paying out dividends. The final amount will be decided by the committees in the second quarter of 2018 when the year-end results are finalised.
Explaining the general direction of the Group, Werner M. Dornscheidt, Chief Executive Officer of Messe Düsseldorf GmbH, says: “We are aiming to increase our sales without the usual cyclical fluctuations that normally occur in the trade fair business.” He maintains that one important step in this direction is the Group’s successful expansion of its international business: “Thanks to the unwavering strategic development of our global portfolio under the umbrella of Düsseldorf’s leading global trade fairs, we’ve increased the international share of our net revenue from 16.5 per cent in 2016 to around 17.8 per cent,” says Dornscheidt. “We will definitely pursue this path in our global network – with new events, innovative ideas and local joint ventures. We want to increase our Group’s international sales to 25 per cent by 2030. This is still very much our aim.”
Messe Düsseldorf 2030: Strategic expansion of the global portfolio focuses on future markets
Of the EUR 64 million achieved by the Group internationally in 2017, EUR 31.4 million was made in Russia, EUR 11.7 million in China, EUR 7.8 million in Singapore and EUR 4.3 million in the US. In total, the Messe Düsseldorf Group realised 54 proprietary and joint events outside Germany. 66 events are planned for 2018. In particular, Messe Düsseldorf has been strengthening its position on future markets with major potential for growth, e.g. India. Nine new events had their premières outside Germany in 2017. Others will follow in 2018. “We are taking the topics of our leading global trade fairs into new markets,” says the head of Messe Düsseldorf as he explains his corporate strategy. “In this way we are creating cross-border synergies. We regard a global presence as an indispensable investment on our part, both for our customers’ benefit – seeing that they operate worldwide – and also to strengthen the number one events at our home base in Düsseldorf.”
Positive feedback effects: leading global trade fairs in Düsseldorf ensure guaranteed revenue through a high level of internationalism again
The positive feedback effects of Messe Düsseldorf’s international business are substantial for Düsseldorf as a trade fair venue. Averaging an international exhibitors’ share of 71.5 per cent, proprietary events in Düsseldorf in 2017 show values again which are unique for German industrial goods trade fairs (previous events: 70.6 per cent). The high level of internationalism was particularly in evidence at ProWein (85 per cent), MEDICA (79 per cent) and interpack (77 per cent). In the same way, the proportion of international visitors rose to an average of 36.7 per cent (previous events: 35 per cent). The highest rates were achieved by interpack with 74 per cent and EuroShop and MEDICA with over 60 per cent international visitors.
Dornscheidt emphasises that “Düsseldorf’s leading global trade fairs are brands with a high level of international prestige. It’s not just us as trade fair organisers who benefit, but the entire Düsseldorf region. After all, guests from other countries stay in Düsseldorf for a bit longer than trade visitors from other parts of Germany.” The ifo Institute recently estimated that the revenues generated in and around Düsseldorf by events and conventions organised by Messe Düsseldorf and its subsidiary DCSE amounted to EUR 1.66 billion. The urban hub on the river Rhine owes 16,700 jobs and tax revenues of over EUR 36m to the trade fair and event business. “Düsseldorf’s indirect returns should in fact be rated much higher, considering that Düsseldorf City Council pays no subsidies in return. Messe Düsseldorf has been operating, investing and growing in its own strength for many years,” says Dornscheidt.
In all, in 2017, Messe Düsseldorf GmbH held 29 events (previous year: 31) at its exhibition centre on the river Rhine, including 17 proprietary and 12 partnership/guest events. 28,700 exhibitors showcased their innovative products to around 1.4 million visitors, occupying nearly 1.2 million square metres of rented net exhibition space. “We recorded about six per cent more visitors and exhibitors and twelve per cent more net space than at the previous events,” says the head of Messe Düsseldorf as he comments on the new record figures on home ground. The biggest revenue drivers last year were the number one events interpack, EuroShop, MEDICA, A+A, boot and ProWein.
The most central task over the next few years will be the digital transformation of the trade fair business.
Werner M. Dornscheidt sees the digital transformation of Messe Düsseldorf as a vital factor in determining its future: “The digitisation of industries is changing markets and products – and therefore also trade fairs as meeting points of the globalised economy.” Dornscheidt is convinced that “when it comes to viable survival strategies, a trade fair company can no longer simply rely on providing technically well-equipped rental space on its premises. Our events must anticipate and understand the new demands of exhibitors and visitors and must open up entirely new areas of experience,” says Dornscheidt as he comments on the central goals of his digital strategy. The focus is not only on digital measures in relation to bookings and visitor registrations, but also on new services designed to facilitate the business activities of exhibitors and visitors, to intensify a person’s general experience at trade fairs and to extend the same through the use of suitable media. This includes matchmaking tools, personalised indoor navigation and location-based information systems as well as the development of new business models in data-driven marketing. According to Dornscheidt, an important step in 2017 was the successful launch of the new Online Order System, whereas the most important hardware investment will be the WLAN-equipment of all halls.
The Group has anchored the important future issue of digitisation in its corporate management and created a designated business unit that deals with the digital transformation of Messe Düsseldorf.
New Southern Section: investing in the future
Alongside Messe Düsseldorf’s digital transformation, the Group continues to pursue the modernisation of the Düsseldorf Exhibition Centre as a central part of its corporate strategy. In 2017 and 2018 the focus will be on building a new Hall 1 and southern entrance area with state-of-the-art space for exhibitions, conventions and other events.
With a revenue of around EUR 360m in 2017, the Messe Düsseldorf Group maintained its position as one of Germany's most successful trade fair companies. 28,700 exhibitors presented their products to 1.35m trade visitors at events in Düsseldorf this year. Moreover, conventions attracted over half a million visitors. About 50 trade fairs were held in Düsseldorf, including 23 number one events in five areas of expertise: machinery, plants and equipment, trade and services, medicine and healthcare, lifestyle and beauty, and also leisure. In addition, there were about 70 proprietary, joint and contracted events outside Germany, demonstrating that the Messe Düsseldorf Group is a leading global platform for export. Messe Düsseldorf GmbH is the trade fair company with the highest level of internationalism in capital goods exhibitions. In 2017 Messe Düsseldorf's proprietary events in machinery, plants and equipment had approx. 74 per cent international exhibitors and attracted 73 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 138 countries (74 international representations) as well as competence centres in 8 countries.