RELX PLC — FY2022 Form 20-F Summary
Reporting period: Year ended December 31, 2022; filed February 23, 2023. This is an annual report, not a standalone Q4 filing. RELX is a global provider of information-based analytics and decision tools, operating in Risk, Scientific, Technical & Medical (STM), Legal and Exhibitions. Financial statements are prepared under IFRS as issued by the IASB.
Key financial metrics
| Metric | FY2022 | FY2021 |
|---|---|---|
| Revenue | £8,553m | £7,244m |
| Reported operating profit | £2,323m | £1,884m |
| Adjusted operating profit | £2,683m | £2,210m |
| Reported profit before tax | £2,113m | £1,797m |
| Reported net profit attributable to shareholders | £1,634m | £1,471m |
| Adjusted net profit attributable to shareholders | £1,961m | £1,689m |
| Reported / adjusted EPS | 85.2p / 102.2p | 76.3p / 87.6p |
| Cash generated from operations | £3,061m | £2,476m |
| Net debt at year-end | £6,604m | £6,017m |
Reported revenue grew 18%; growth was 11% at constant currency and underlying revenue growth was 9%. Foreign-exchange movements added £543m to revenue. Adjusted operating margin rose to 31.4% from 30.5%; reported operating margin increased to 27.2% from 26.0%. Reported net finance costs were £201m, compared with £142m. Cash and cash equivalents were £334m at year-end. RELX reported ample liquidity and had an undrawn $3.0bn committed bank facility maturing in April 2025.
Capital expenditure on property, plant, equipment and internally developed intangible assets was £436m, including £400m of capitalised development costs. Acquisitions used £460m of cash. Dividends paid were £983m; the proposed final dividend was 38.9p per share, bringing the stated full-year dividend to 54.6p. The company repurchased 21.7m shares for £500m.
Material changes and segment performance
- All four segments recorded underlying revenue growth. Risk revenue rose 18% reported and 8% underlying; STM rose 10% and 4%; Legal rose 12% and 5%; Exhibitions rose 78% and 64%, respectively. Exhibitions’ reported rebound reflected renewed face-to-face activity and event-cycle effects.
- Underlying adjusted operating profit grew 15%; reported adjusted operating profit grew 21%, including favorable currency translation. Reported operating costs increased 16%, reflecting technology and product investment and higher Exhibitions activity, partly offset by process efficiencies.
- Adjusted net profit grew 16%, while reported net profit grew 11%. The tax charge rose to £481m from £326m; the prior-year charge benefited from resolution of prior-year tax matters. UK corporation tax was scheduled to rise from 19% to 25% from April 1, 2023.
- Net debt increased £587m as reported; excluding currency effects, the increase was £26m. Sterling weakness against the US dollar and euro increased translated debt.
Outlook, risks and unusual items
The filing does not provide a specific numerical revenue or earnings forecast. Management describes growth as supported by digital products, analytics and improving Exhibitions activity. It states a long-term objective of cash-flow conversion of at least 90%, and a dividend policy of growing dividends broadly in line with adjusted EPS while targeting at least two-times dividend cover.
- Key risks include cyberattacks and data breaches, evolving privacy and data-use regulation, intellectual-property challenges, macroeconomic and geopolitical conditions, foreign-exchange and interest-rate movements, competition and technological change, and reliance on third-party suppliers and platforms.
- Exhibitions remain exposed to event disruption, travel restrictions, severe weather and venue availability. STM’s primary-research business faces changes in the balance between pay-to-read and open-access publishing.
- Tax positions involve significant judgment: uncertain tax provisions were £239m at year-end, versus £228m in 2021. Legal and regulatory risks include US data-security and consumer-information matters and compliance with FTC settlement orders. The company says settled matters and other ordinary-course proceedings are not expected to materially adversely affect its financial position or operating results.
- Unusual comparative items include a £55m gain on disposals and other non-operating items in 2021 versus a £9m net loss in 2022, and a £27m 2021 gain from revaluation of a Legal subsidiary option arrangement. Acquisition-related charges rose to £62m from £21m.
Ernst & Young issued an unqualified opinion on the financial statements and on internal control over financial reporting. The auditor identified uncertain tax positions as a critical audit matter.
Investor verification priorities
- Review the complete audited statements and notes incorporated from Exhibit 15.2, including the full cash-flow statement, working capital, liquidity and debt maturity details; the supplied filing text does not show a clear free-cash-flow figure.
- Reconcile reported and adjusted measures, including adjusted profit, EPS and margins, and assess how much reported growth depended on currency movements and Exhibitions recovery.
- Assess the £239m uncertain-tax provision, related tax exposures and the effect of the UK tax-rate increase.
- Monitor net debt, refinancing needs and the effect of currency and interest-rate changes; verify the company’s assumptions behind its liquidity and cash-conversion statements.
- Track cyber and data-protection controls, FTC settlement compliance, and changes in open-access publishing and face-to-face event conditions.