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Russell Taylor, CEO of ITE, is an exhibitionist – in the best sense, as can be seen in the focus he has brought to the group

by Susanna Twidale

When I meet Russell Taylor he is so fresh in the job as CEO at exhibition group ITE that the business card he hands me still has the moniker finance director on it.

As it turns out, however, had the board been a bit quicker off the mark he could have already been doing the job for the past six months and saved a great deal of faffing around and market uncertainty.

Former CEO Ian Tomkins announced his intention to leave in early 2007 and Taylor is honest about the fact that he went for the position. ‘I did apply for the job,’ he says candidly, so I ask him why he thinks he wasn’t given the role back then. ‘People tend to see you as you are. If you are a finance director they tend to see you as a finance director and they don’t perhaps see some of the other things you might have done,’ he explains.

The position was instead given to Bill Dye, who had previously been executive director of support services group Capita and had a background in media services but no particular exhibition back ground. But the appointment was short-lived and, after joining in September 2007, he left in January 2008 and joined Lloyds TSB Registrars Equini.

Taylor stepped in as CEO, while also being finance director. This, he says, allowed him to show he was the right man for the job. ‘That’s given me a chance to work with the board and a chance for them to understand what my abilities are,’ he says. ‘If the company decided it wanted to be in radio advertising in Russia I wouldn’t have applied for the job.’ He adds that, during the process of looking for the new CEO, the board had several months to really focus on which direction it wanted the company to take. ‘During the end of that debate it has come out in favour of my strong suit, which is that we are going to be in exhibitions.’ His answer is confident and perfectly plausible but I press a little further and ask if he feels he has anything to prove.

Redefining the role

‘No,’ he retorts. ‘In a way, we went though a process of redefining the CEO role for three or four months and actually it’s one that suits me much better than perhaps the old one would have. So in that sense the group has emerged from that six-month period with a different idea of what its management structure and its priorities are.’ The focus now he says, is very much on the exhibition industry. ‘Any opportunities we do take are likely to be more closely allied with the exhibition industry than they might otherwise have been. Bill who came from outside the industry may have suddenly decided that there was a great opportunity in Russia in something that was unrelated. I am quite keen to keep on perusing sensible strategic investments but they are much more likely to be inline and around the current business activity.’

The CEO position was one big question mark that had been hanging over the company since the beginning of the year. While Dye’s blink-and-you’ll-miss-it arrival and departure at ITE was too swift to have any lasting impact on the business, according to Taylor, the uncertainty over who would fill the role certainly had. ‘I think I hadn’t realised it,’ Taylor muses. ‘It just shows how locked up you get in your own world. As a finance director I didn’t realise how much investor uncertainty not having a CEO created, because for me business was carrying on as normal.’ Despite rafts of positive buy notes from analysts, shares in the company were stuck in a 135p-155p trading range for the four months after Dye’s departure, only breaking through in mid-May after a solid set of interim results and the news about Taylor’s appointment.

‘We had some fans out there who were thinking “I’d like to see the face of the new CEO before I invest” and I think that explains why the shares have recently come out of their trading range,’ Taylor says. It’s hard to argue against this as there is a clear correlation between the stability the new CEO has brought and the company’s improved share price since then. ‘I have been going to investor meetings for the past five years, telling them what we are going to be doing and then going back the next year and we’ve done it,’ he says, clearly proud of the fact he is seen by the market as a man who delivers.

Stability, however, doesn’t mean a lack of excitement for investors, and he is quick to allay any fears they might have about a so-called bean-counter being at the helm. ‘I certainly wouldn’t throw the money away but I think that there are really good opportunities for us to take out there and I would say it’s one of my key jobs to make sure that we do not miss these,’ he says.

Above the crunch

Fortunately for Taylor, the emerging markets the company operates in have so far remained fairly immune to the credit crunch blighting opportunities in Western Europe and the US. ‘

The economies are still growing at various rates, from 7% to up to 30% in some places such as Azerbaijan. Those are the opportunities that my customers want to access,’ he says. It has an enviable revenue visibility and, at the recent interims, said £92.9 million of revenues were already booked for the full year, marking a 10% like-for-like increase on last year.

Confidence also translated to a 23% increase in interim dividend to 1.6p per share. ‘We are very cash-positive anyway, so I think we will always have a very progressive dividend policy,’ Taylor confirms, although it is clear he will also not shy away from spending, if the opportunities arise.

‘Buying a good business is a better way of spending money than giving it back to shareholders, and that’s my clear belief. Having said that, if I haven’t got any good businesses to buy, giving it back to shareholders is better than leaving it in the bank,’ he adds. ‘We have almost got a holding statement that we won’t let our cash balances rise above £25 million, and I think management deserves the opportunity of a year or two to see where we go with that before we decide to give more back.’ ITE is a hugely cash-generative business. At its last interim results to the end of March it had a cash balance of £39.5 million, so there is plenty of scope for Taylor to add to the business if the right project comes along.

Taylor says emerging markets will remain the company’s focus, and rules out any moves to enter the western European market. ‘There’s no doubt that China and India will have much bigger exhibition industries in five years’ time than they have at the moment so there is a big growth potential there. But both sides of the coin are very different. China has been overrun with international exhibitors since 1990, whereas India is still relatively underdeveloped in terms of exhibitions,’ he says, although acquisitions are not an immediate propriety.

Taylor’s passion for exhibitions really shines through during the interview and a driving desire to make sure ITE’s shows are the best is clear.

Before ITE he spent seven years at Earls Court Olympia, where he was group finance director and then managing director. ‘You walk though 100 exhibitions a year on the way to the lunch canteen, so you know your product very well,’ he says. ‘To this day, I like to walk round exhibitions so, if I go to one, I walk round all of it. I just see so many – I know what’s good and what’s bad.’

Nowadays he only goes to another company’s exhibition if it is in direct competition with one ITE is hosting or if he is interested in buying it, and it would be his option on it that would have the casting vote. ‘I would always want to see a show if I was going to buy it,’ he says. ‘No amount of looking at market research or numbers would overrule what I felt about an exhibition.’

For now Taylor has enough on his plate juggling the dual roles of finance director and CEO. ‘The financial year starts on 1 October and I really want someone in place by then. October and December and the interims – those are the times when it becomes very stressful being finance director and CEO because you are working 12 hours a day as the finance director then,’ he says.

The recruitment process is under way and as CEO Taylor will be making a recommendation to the board about who should be appointed. This time round, however, his words will have more sway, and you can’t help thinking they should have paid more attention to his suggestions when he went for the CEO role in the first place.

Would I buy shares in ITE? YES

30 second ITE

• Set up in 1991, ITE floated in London in 1998

• Valued at just over £428 million

• Over 650 staff worldwide

• 150 events organised annually in 14 countries, including Russia and across central Asia

• Key industry sectors include, oil & gas, building and food & drink

• Has 19 offices in 15 countries

• This week (24-26 June) ITE is hosting the sixth Russian Petroleum Congress in Moscow (pictured left)