Letter from the Chairman
In 2017, growth at global level, and most notably in the Euro area, has continued with a 3.7% increase in GDP and more robust international trade exchanges (up by 5.%), according to the estimates of the International Monetary Fund (IMF). The main risks at global level are associated with a possible downturn on financial markets and more widespread trade restrictions.
Business has continued to grow in Italy as well, with gross domestic product rising by 1.%, boosted by investment and exports. Economic surveys confirm that the confidence level among households and companies has remained high on a regular basis and in line with the GDP expansion.
Economic-financial and political factors still remain a source of uncertainty for the commercial sector in Italy, even though the prospects for increased investment expenditure plans by companies seem to have been confirmed.
Within this framework, the data available for 2017 appear to be encouraging for the trade fair sector in Italy as well: the trend recorded by both CERMES – Bocconi and CFI (Comitato Fiere Industria, the Confederation of Italian industries’ agency for trade fairs) shows clear signs of recovery, with international events in Italy (accounting for about 75% of the trade fair business overall), scoring levels of growth which were unprecedented in years. This trend is positively affected by international trade and, as a consequence, by companies’ propensity to taking part in trade fairs which provide a major platform for international exchanges.
At international level the industry is experiencing a growth of competitive pressure and a process of consolidation, driven by important M&A operations which have changed the ranking of major players worldwide. The leading player in the sector is now the group resulting from the merger between Informa and UBM, with a 2017 turnover for trade fairs and congresses amounting to nearly two billion euro. The main private equity funds are making considerable financial investments, on an unprecedented scale, thus overturning consolidated hierarchies.
The past financial year has been significant for the implementation of the new Business Plan, characterized by the dual role of Fondazione Fiera Milano as proactive shareholder in its subsidiary Fiera Milano on the one hand and as long-term investor on the other; this has become apparent mainly through the complete overhaul of corporate governance at Fiera Milano Spa, as a result of the profitable partnership between shareholder and subsidiary, the reshaping of corporate procedures, which have been made more effective, and management efficiency, boosting competitiveness in the trade fair-congress sector and consolidating investment for higher levels of sustainability and innovation of the Milan trade fair system.
The guidelines implemented in 2017 have made it possible to select and achieve, among others, the following objectives which are the pillars of the new projects for the trade fair-congress system in Milan:
- structural Investment Program aimed at boosting the competitiveness and sustainability of the trade fair-congress hub in Milan, which already has a top-ranking position at international level, totaling approx. 100 million euro;
- upgrading the corporate system (new rules and procedures, reinforcing core competences);
- consolidation of our equity structure thanks to a new financial strategy, based on streamlining the overall deficit and on the acquisition of new resources through long-term financing (banking pool) and the European Investment Bank (EIB);
- a new sponsoring and donation policy, focused on the utmost transparency and geared towards the five sectors of culture, education, scientific research, community and sports;
- new governance of Fiera Milano Spa, in view of the significant surplus in the financial year 2017, which also had an impact on its Stock Exchange value, as a consequence of Fiera Milano’s upgrading in terms of image and standing through a corporate turnaround.
With the implementation of the 2017-2019 Business Plan, Fondazione Fiera Milano is taking on important new challenges. Its commitment is to achieve the ambitious goals of the new Plan, in line with its statutory aims and at the service of the trade fair system as a whole, with a view to making sure that its exhibition venue reaches an increasingly attractive and competitive position as a functional excellence hub at international level. At the same time Fondazione aims to take on a strategic role as “corporate foundation” in the area of culture, research, innovation, and for the community, as a major player for the development of the region in pursuit of its statutory objectives.
Giovanni Gorno Tempini
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