Annual Report 2013
Stronger international position in chosen growth sectors Transfer of activities of Maastrichts Expositie & Congres Centrum (MECC) Good results despite absence of AutoRAI
Inspiring people
Prestigious sustainability awards confirm leading position of Amsterdam RAI
Cover: Premier of the large-scale use of e-poster signs during ISTH, June 2013
Disclaimer: Whenever this annual report mentions ‘Amsterdam RAI, ‘we’, ‘the company’ or similar indications it refers to RAI Holding B.V. as explained in the ’Corporate governance‘ paragraph on page 71. Segments of this annual report contain opinions regarding the future. These segments can – without limitations – contain expectations on future realised and unrealised results, profits, payments, government measures, the impact of other regulating measures on the activities of Amsterdam RAI, subsidiaries and macro-economic trends and the performance of Amsterdam RAI. Such statements are preceded or followed by or include terms such as ‘believe’, ‘expect’, ‘prognosticate’, ‘feel’, ‘anticipate’ or similar. These future-oriented statements are based on current assumptions of future activities and are subject to known and unknown factors and other uncertainties, many of which are outside Amsterdam RAI’s sphere of influence, This means that future results can in fact differ substantively from these expectations.
ANNUAL REPORT AMSTERDAM RAI 2013
Contents
Overview 4 Profile 5 Key data 8 Foreword 10 Composition of Supervisory Board and Executive Board 12 The power of connections 14 Statement from the Supervisory Board
17
Executive Board report 26 Market developments 27 Strategy 30 CSR policy 34 Results 2013 35 Events 41 RAI-organised events 41 Events by third parties 48 Facilities 52 Company and personnel 57 Shareholder equity and loan capital 58 Prospects 67 Governance and risk management Corporate governance Risk management
70 71 77
Financial statement 80 General 81 Consolidated balance sheet (before proposed appropriation of results) 85 Consolidated profit and loss account 86 Consolidated cash flow statement 87 Notes on the consolidated balance sheet as of 31 December 2013 88 Notes on the consolidated profit and loss account as of 31 December 2013 93 Company balance sheet (before appropriation of results) 95 Company profit and loss account 95 Notes on the company balance sheet as at 31 December 2013 96 Other information Proposed appropriation of results Events after the balance sheet date Independent auditor’s report Personal details of management and Works Council of Amsterdam RAI
98 98 98 99 101
Colophon
102
ANNUAL REPORT 2013 - AMSTERDAM RAI
#01
Overview
OVERVIEW
Profile Exhibition and conference organisation
Multifunctional complex: Switching quickly and flexibly between events
Specific services for organisers, exhibitors and visitors
25 national and international consumer and trade events
World market leader in five segments
Digital technology and virtual media seamlessly integrated
Amsterdam RAI stimulates city and region
Leader in corporate social responsibility
Amsterdam RAI is an international exhibition and conference company that organises events in the Netherlands and abroad and runs the Amsterdam RAI Convention Centre, an exhibition and conference centre located in the Zuidas district of Amsterdam. The company also provides event-related services to organisers, exhibitors and visitors. The dynamics of combination letting The Amsterdam RAI Convention Centre annually hosts some 500 events that attract around 1.5 million visitors. These events take place in an innovative, sustainable and cost-efficient complex. The strength of the convention centre is its multifunctional character, which allows the RAI to switch quickly and flexibly between the widest possible range of use. As a result the occupancy rate is approximately 50 percent, one of the highest rates in Europe. Hospitable organisation Amsterdam RAI employees welcome clients and guests in a hospitable way. Whether it involves a meeting of five people, 50,000 conference visitors or 250,000 exhibition visitors, the extensive experience and expertise of Amsterdam RAI and its regular suppliers offer a wide range of services and products to ensure all demands can be met. Organisation and operation of RAI exhibition titles Around half of the turnover of Amsterdam RAI is related to RAI-organised events. A separate division within Amsterdam RAI develops and operates exhibition titles. In total it organises 25 consumer and trade events, of which the latter are both national and international. These events largely take place in Amsterdam, but some are organised abroad in different exhibition and conference buildings. Retaining a clear focus on first-class events and its knowledge of markets and target groups, Amsterdam RAI has exhibition titles in five sectors in which it is a global market leader. These sectors (and exhibition titles, respectively) are: professional cleaning (ISSA/INTERCLEAN), remanufacturing (ReMaTec), traffic technology (Intertraffic), the maritime sector (METS), and water technology (Aquatech). Physical and virtual meetings In addition to physical meetings, Amsterdam RAI also facilitates virtual meetings, seamlessly integrating the virtual world on the exhibition floor and in the conference halls. Moreover, the RAI enhances the range of exhibitions and conferences and allows the continuation of contacts between target groups and communities outside of event dates. Stimulating city and society Amsterdam RAI stimulates the economy in the city and region. Hotels, restaurants, museums, transport companies, suppliers and the airport benefit from the large number of exhibitors and visitors who visit the city due to the (often international) exhibitions, conferences and events. Corporate social responsibility (CSR) is an integral part of the policy of Amsterdam RAI. Our CSR approach has received international recognition with the most prestigious sustainability certificates.
AMSTERDAM RAI
5
OVERVIEW
Profile Two shareholders Amsterdam RAI has two shareholders: the RAI Association and the City of Amsterdam. RAI Association: 75%
Majority shareholder in Amsterdam RAI is the RAI Association (75 per cent). The RAI Association is the trade association for manufacturers, importers and wholesalers in mobility-related products such as cars, trucks, bicycles and trailers. The association has 550 members. The involvement of the association with Amsterdam RAI has a long history. The bicycle industry started organising an annual trade exhibition in Amsterdam in 1893. The name RAI, which stands for the ‘bicycle and automotive industry’ was developed several years later after the automotive sector joined.
City of Amsterdam: 25%
386 FTE
The remaining shares are owned by the City of Amsterdam (25 per cent), the participation of which dates back to 1956 and has an economic background. Seeing what Amsterdam RAI means for the region this is very understandable: one euro of turnover for Amsterdam RAI equals four euros of turnover in the region. Additionally, Amsterdam RAI generates some 6,000 jobs in the greater Amsterdam region, making a substantial contribution to local employment.1 Personnel At the end of 2013 Amsterdam RAI employs 421 people (386 FTE). Ecorys, 2006
1
Events at home and abroad Amsterdam RAI hosts national and international events in Amsterdam, and is also active in other countries. Examples of national events that have been organised in Amsterdam for decades include the Huishoudbeurs, Horecava (for the hospitality and catering sector) and the HISWA watersports exhibition. Another famous title is the AutoRAI, which did not take place in 2013 due to the economic conditions. Less well-known to the general public are the trade events for specific sectors, such as the RAI-organised international exhibitions listed on page 42 as well as the International Broadcasting Convention (IBC) and Integrated Systems Europe (ISE). The RAI also hosts various (medical) conferences and countless other events including theatre shows, dance events and the international equestrian event Jumping Amsterdam. Abroad Amsterdam RAI organises exhibitions in countries such as China, the USA, Poland, India, Mexico and Turkey. A bird’s eye view of the Convention Centre Total surface area 106,500 m2 Halls 11 connected halls, with possibility to extend with two further semipermanent halls Meeting rooms: A large ballroom seating 2,072 people and 48 meeting rooms, which can be expanded with another 20 rooms. Accommodation for 10,000 people Foyers and lounges multifunctional spaces for expositions and parties Entrances 8 separate entrances: every event has its own entrance Restaurants and bars 7 restaurants, bars and lounges. From buffet to a la carte Parking garages capacity of 3,000 spaces on the RAI premises Marina private marina with a direct connection to the Amsterdam canals
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ANNUAL REPORT 2013
inspiring people we believe in the power of connecting
OVERVIEW
Key data* Events 2013
2012
2011
2010
2009
International events
47
48
47
48
36
National events
48
59
59
57
60
Stage shows
85
119
83
85
159
Other events
297
403
406
400
318
Total in Amsterdam
477
629
595
590
573
0
4
8
10
7
Elsewhere outside of the Netherlands
10
6
7
5
5
Total outside of Amsterdam
10
10
15
15
12
487
639
610
605
585
International events
451
392
306
291
198
National events
677
764
1.058
774
1.016
Stage shows
80
125
82
85
199
Other events
173
152
140
236
422
1,381
1,433
1,587
1,385
1,834
0
50
79
82
86
Outside of the Netherlands
67
62
43
40
31
Total outside of Amsterdam
67
112
122
122
117
1,448
1,544
1,708
1,507
1,950
Elsewhere in the Netherlands
Total
Visitors (rounded, x 1,000)
Total in Amsterdam
Elsewhere in the Netherlands
Total
* In the Turnover and Results, MECC Maastricht was included in the Key Data up to 4 July 2013 (also see page 81 of the Financial Statement). With regard to Events and Visitors, MECC Maastricht is included in the Key Data up to and including December 2012.
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ANNUAL REPORT 2013
OVERVIEW
Turnover and results (â‚Ź x 1 mln)
2013
2012
2011
2010
2009
Exhibitions and events
39.4
52.5
53.5
48.5
34.1
Letting to third parties
23.6
23.2
23.5
21.6
26.4
-
3.2
4.0
5.0
5.3
Catering
17.8
16.9
18.1
17.5
14.1
Parking
4.3
5.4
6.2
5.7
6.0
Hotel commissions
3.5
3.1
3.3
2.6
2.4
20.8
22.3
18.2
17.3
13.7
7.2
8.1
6.8
6.8
6.2
116.6
134.7
133.6
125.0
108.2
Outsourced work
46.0
57.3
58.9
48.1
46.7
Wages and salaries, incl. social securities and pension contributions
29.1
31.5
31.0
30.4
27.6
Amortisation
15.3
15.8
14.5
14.7
12.8
Other
19.1
24.1
21.4
20.2
16.6
109.5
128.7
125.8
113.4
103.7
22.4
21.7
22.8
26.3
17.3
7.1
6.0
7.8
11.6
4.4
6.1%
4.5%
5.8%
9.3%
4.1%
3.3
2.1
3.1
5.7
0.2
77.7
76.4
76.3
76.5
70.9
189.9
196.2
203.9
208.0
210.6
40.9%
38.9%
37.4%
36.8%
33.7%
390
479
489
475
481
100%
100%
99%
98%
98%
Trade journal publications
Facility services Other Turnover
#
Operating expenses
EBITDA
Operating result As % of turnover:
Net result
Balance sheet (â‚Ź x 1 mln) Shareholder equity Balance total Solvency
Personnel (Employed by group, average) FTEs In the Netherlands #
Other value changes of intangible & tangible fixed assets and other operational expenses including other personnel costs.
AMSTERDAM RAI
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OVERVIEW
Foreword The year 2013 was an exceptional one for Amsterdam RAI; with a record number of over 400,000 international visitors, a raft of sector-leading medical conferences and the start of the construction of the new Amtrium being among many highlights. At the same time we had to take into account the loss of AutoRAI, among others, in our annual turnover. The bottom line, though, is one of satisfaction with and appreciation of our organisation’s (commercial) effectiveness. Whereas we had labelled the year as being ‘challenging’ in advance, by the end of 2013 we had recorded outstanding results. Better results despite lower turnover We worked hard to encourage growth on many different fronts, to improve our organisation
Amsterdam RAI experienced an exceptional year for conferences. Cardiologists, oncologists, hepatologists, thrombosis specialists; we were privileged to welcome the most diverse range of specialists. Over the past five years we have realised growth of more than 30% in this market segment. This is important not only for Amsterdam RAI but for the city of Amsterdam as a whole. In combination with our other international events, Amsterdam RAI accounts for 20 % of the business stays in Amsterdam. Memorable moment The most memorable moment of the year was the transformation from the ESC cardiologists’ conference to the IBC television trade exhibition. Due to the high occupancy rate of our Convention Centre we had just 38 hours to
“With a record number of over 400,000 international visitors, a raft of sector-leading medical conferences and the start of the construction of the new Amtrium being among many highlights.”
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ANNUAL REPORT 2013
strategically and to better manage costs. This has led to an increase in profit over the fiscal year to € 3.3 million (€ 2.1 million in 2012), even though turnover was 15% down on the previous year.
completely reconfigure Amsterdam RAI from a conference centre into a trade exhibition. This impressive achievement was realised with the support of our partners and stands as an example to our sector.
There is a story behind this reduction in turnover. Due to the recession, AutoRAI was not held in this financial year. In addition, activities associated with RAI Langfords and MECC Maastricht were terminated on 1 January 2013 and 1 July 2013, respectively. In both cases the added value for Amsterdam RAI was considered insufficient in the long term. The decrease in turnover during 2013 is entirely explained by these factors.
Major steps taken in implementation strategy Through a series of targeted investments in our facilities and exhibition concepts Amsterdam RAI has been able to attract and stage large international events. This has also produced results outside Amsterdam. Compared to the previous year, our ‘international turnover’ doubled in 2013, to € 6 million, which is a fine achievement. From our base in Amsterdam we
OVERVIEW
are working on spin-offs of our own exhibitions in other countries, and are currently organising events in China, USA, Poland, India, Mexico and Turkey. Another important element of this course is offering more integrated, total solutions to our clients. Internally, these are referred to as ‘more solutions’. Our aim is to better connect and align the services provided by our various Amsterdam RAI departments to the needs of our clients. A third element of this course is taking the lead within the field of virtual applications and solutions. We go into greater detail on what is understood by this and what we have already achieved later in this report.
sustainability standard in the business tourism sector. Achieving EarthCheck Gold status underlines the leading role that Amsterdam RAI plays in the field of sustainability within the global Meetings, Incentives, Conventions & Exhibitions (MICE) industry. Looking ahead Based on bookings received, the strong national and international position that Amsterdam RAI occupies and the flexibility of our organisation to quickly adapt, we have gone into 2014 with confidence. Throughout the year we will continue to unite people, ideas and visions. For our clients, for ourselves and for the city of Amsterdam. RAI Holding B.V.,
Sharing knowledge Amsterdam RAI has accumulated a vast amount of knowledge in the field of organising and facilitating events and trade exhibitions. As a business, we aim to maintain a leading position and regularly highlight trends in a series of publications under the name ‘RAI Insights’. Amtrium construction In mid-October preparations began for the construction of the new and multifunctional Amtrium building. Our new exhibition, conference and office complex is the first project to spring from the report ‘RAI (Spatial) Future Vision’. In this report, published in 2011, Amsterdam RAI and Amsterdam City Council’s Zuidas Service together decided that Amsterdam RAI should remain at its current location and should focus on sustainable development. In addition to the Amtrium, which is scheduled for completion in May 2015, we will also expand the Amsterdam RAI Convention Centre in the near future to include a RAI Hotel with a capacity of 800 rooms and, most likely, an extra garage for parking 1,000 cars.
A.J. (Hans) Bakker General Director
A.J. (Hans) Bakker General Director
Corporate social responsibility We are proud of the fact that Amsterdam RAI became the first exhibition and conference centre in Europe, and only the second worldwide, to be awarded the EarthCheck Gold status. EarthCheck is the world’s leading
AMSTERDAM RAI
11
OVERVIEW
Composition of Supervisory Board and Executive Board Supervisory Board
At the end of 2013 the Supervisory Board consisted of five members.
Appointed 8 April 2010, in first term of office until April 2014, Chairman since 8 April 2010
Appointed 7 April 2011, in first term of office until April 2015
Appointed 1 September 2004. Third and last term of office until September 2016
Appointed 12 April 2012 in first term of office until April 2016
Appointed 19 December 2008. Second term of office until December 2016
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ANNUAL REPORT 2013
J.H.J. (Jan) Mengelers (1953), Chairman Dutch nationality. Chairman of the Board of TNO (until 1 March 2014). As of 1 March 2014 Chairman of the Board of Eindhoven Technical University. Other commissionerships: member of Executive Board Joanneum Research Forschungs gesellschaft mbH, member Executive Committee Point-One (until January 2013). Additional social functions: Chairman Executive Board EARTO, member of the Innovation Council (Dutch Ministry of Infrastructure and the Environment), Board member of SIA (Foundation Innovation Alliance), member of the Board of SKO (Knowledge Development Foundation for Universities of Applied Sciences), member of the Board of STT (Netherlands Study Centre for Technology Trends). J.W.Th. (John) van der Steen (1954), Vice Chairman Dutch nationality. Chairman Aon Global Accounts of Aon Risk Solutions, Chairman Aon Holdings. Other commissionerships: member advisory council of Erasmus van Wees Executive Search, Interim Management and Interim Professionals. Additional social functions: Board member of Lotgenoten Nederlands Blazers Ensemble (until 1 January 2014), member of advisory council MASC Company B.V. F.I.M. (Ferry) Houterman (1949) Dutch nationality. Member Supervisory Board on the recommendation of the Works Council. Independent management consultant. Other commissionerships: member Supervisory Board Rabobank Amsterdam, member Supervisory Board Holland Casino (until 31 December 2013), member Supervisory Board Hampshire Eden Hotel Group, member Supervisory Board Tahal / GTC (Kardan Group). Additional social functions: member Supervisory Board ROC Amsterdam, member Supervisory Board BNN-VARA, member Supervisory Board CNV Publieke Zaak, member Supervisory Board Waarborgfonds Kinderopvang / Ruimte Onderwijs, member Supervisory Board Jongeren Cultuurfonds, member Supervisory Board Metropole Orkest (as of 1 January 2014). S.J. (Shulamith) Rijxman (1959) Dutch nationality. Member of the Executive Board of Netherlands Public Broadcasting (NPO). Additional functions as NPO Executive Board member: Board member of the CoBO Fund and Board Member of STER. Additional social functions: member advisory council of LOF (until August 2013), member Supervisory Board Pink Ribbon (until December 2013), Board member Women Inc. (until August 2013), member Dutch Creative Council (until December 2013), Chairman Amsterdam Marketing (as of 1 January 2014), member advisory council of Mijksenaar (as of 1 September 2013). J.R. (Hans) Vermeulen (1941) Dutch nationality. Previously Director of Koninklijke Vermeulen Hollandia BV and Chairman of the RAI Association. Additional social functions: Chairman regentencollege Stichting Codde en Van Beresteyn Haarlem (until 31 December 2013), Board member Gravinnehof Haarlem (until 31 December 2013), Supervisory Board member Frans Loenenhofje Haarlem (until 31 December 2013), Vice-Chairman Supervisory Board Kennemer Gasthuis hospital in Haarlem (until 30 June 2013), Board member Elisabeth van Thüringen Foundation.
OVERVIEW
Supervisory Board member whose term ends in year of review Appointed 13 September 2007.
Professor A.J.M. (Annemieke) Roobeek (1958) Dutch nationality.
Term ended on 1 July 2013
Executive Board
At the end of 2013 the statutory Board consisted of one person.
Appointed 2002
A.J. ( Hans) Bakker (1951), General Director Dutch nationality. Other commissionerships: Chairman Supervisory Board Transavia Airlines B.V., Chairman Supervisory Board GVB Holding N.V., Chairman Supervisory Board SnowWorld Leisure N.V. Additional social functions: Chairman Supervisory Board the Netherlands Board of Tourism & Conventions (NBTC), Chairman of the Board Stichting Jumping Amsterdam, Vice Chairman of the general council of Platform Nederlandse Luchtvaart (until 31Â December 2013), member of the appeal committees of the Travel Refund Guarantee Fund (SGR) the Dutch Calamity Fund for Travellers (SCR), and the Guarantee Fund Foundation for Specialist Tour Operators (SGST), Board member of the Amsterdam Museum Foundation, Board member of Amsterdam 2013, member of the advisory council for the Faculty of Economy and Business of the University of Amsterdam (UvA).
AMSTERDAM RAI
13
OVERVIEW
The power of connections… …to Amsterdam
In a European and global perspective Amsterdam RAI Convention Centre is extremely easy to reach. 323 direct flights Amsterdam Schiphol Airport is known for its high quality and excellent reachability. The airport serves as a hub for transport networks with no less than 323 direct connections to other cities.
Short distance between airport and Amsterdam RAI The distance from the landing strip at Amsterdam Schiphol Airport to Amsterdam RAI Convention Centre is only 10 km. There is a very frequent connection from the train station inside the airport, which takes just ten minutes to bring visitors to the Amsterdam RAI train station.
…in Amsterdam
Due to its central location, Amsterdam RAI offers its visitors a great stay. Historic city centre The Dutch capital is famous for its unique canals. The 17th century canal belt was included on the UNESCO World Heritage List in 2010. The open culture and atmosphere of Amsterdam make all international guests feel welcome.
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ANNUAL REPORT 2013
Compact city, everything within reach A major benefit for international visitors is that Amsterdam is much more compact than other European cities. With a distance of only four kilometres from the exhibition complex to the heart of the city centre, visitors can easily combine their business trip with a pleasant, urban experience.
OVERVIEW
We believe in the power of connecting
In a world full of possibilities that unite people, ideas and visions. For over a century we’ve found ways to bring together people, brands and markets from our base in Amsterdam. Nationally and internationally. As a facilitator and organiser, we have the unique ability to connect context, content and communities. We create the ideal conditions for inspiring meetings. A place where people and ideas converge into unique experiences and unparalleled business opportunities. With our creative commercial spirit and operational excellence we make the impossible possible – for our clients, for the city of Amsterdam and for ourselves. Doing business in a friendly and sustainable way in order to inspire opportunities and collaboration. Bringing people together to surprise, enrich and inspire, both physically and virtually. Always with an open mind and global perspective. All so we can contribute to a future full of new experiences, opportunities and meaningful moments that truly matter. Together.
Amsterdam RAI
Inspiring People Continuous dialogue with high-quality sectors and communities
Organising our own events outside of Amsterdam, even in other (distant) countries, is essential for the future of Amsterdam RAI as it helps us keep in touch and develop a relationship with high-quality sectors and communities. Moreover, these events help spread risks and contribute to our operational results.
How we facilitate success Exhibitor Services • Webshop with products and services for exhibitors. Integration of event organiser in website • Service desk for last-minute orders • Extensive range: stand construction, meeting rooms, lounges, ICT, catering and more • Competitive rates, fast service
RAI Hotel & Travel Service • Facilitates 175,000 hotel bookings a year • Rooms guaranteed available for large events • Special conditions for flights via partner KLM • 24 / 7 online: fast, easy and safe booking • Integration of hotel and travel website in website of event organiser • Flights, transfers, excursions, car and bicycle rental, boat tours and more
Catering • Conference, exhibition, event and visitor catering under own management • A variety of bars, lounges and seven restaurants; from buffet to à la carte and take away venues • Sustainable catering concept: Heartwarming Amsterdam
Certifications • 5-hamers (top-quality) • AIPC Gold • ISO-9001 • ISO-14001 • EarthCheck Gold • Green Key Gold
AMSTERDAM RAI
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#02
Statement of the Supervisory Board
STATEMENT OF THE SUPERVISORY BOARD
To our shareholders The Supervisory Board hereby presents the annual report of RAI Holding B.V. Approved financial statements from auditor
Discussed in detail in Audit Committee and with Executive Board
Supervisory Board accepts Financial Statement, dividend payment proposal of € 2.24 million
Request determination Financial Statement, request discharge
Main agenda items in addition to regular supervision: new dividend policy, real estate and refinancing
Mrs Roobeek has left the Supervisory Board, Supervisory Board back to five members
The annual report was composed by the Executive Board, and includes the financial statements 2013. BDO Audit & Assurance B.V. (BDO) audited the financial statements and provided it with an approved independent auditor’s report, which is included in this report on pages 80 to 100. The Audit Committee discussed the financial statement and annual report in detail with the Executive Board and the external auditor. Consequently, the Supervisory Board discussed the annual report with the Executive Board in the presence of the external auditor. The Supervisory Board accepts the Financial Statement and agrees with the Executive Board’s proposal to pay a dividend of € 2.24 million over the year of review, and add the remaining profit to the ‘unappropriated profit’ of the shareholder equity. The dividend was determined in accordance with the new dividend policy as discussed by the shareholders and RAI Holding B.V. It is expected that the dividend policy will be determined at the General Meeting of Shareholders of 17 April 2014. In advance of this determination, the Board integrated this policy in the dividend proposal over 2013. The Financial Statement 2013 will be put to the General Meeting of Shareholders for determination on 17 April 2014. The Supervisory Board proposes that the Executive Board be given discharge for its management, that the Supervisory Board be given discharge for its supervision, and that the Financial Statement be determined. Key issues in year of review In addition to the regular supervision, the main agenda items in the year of review were: 1. The completion of the MECC and RAI Langfords files; 2. The composition of the Executive Board in 2013; (the extension of the statutory term of the General Director and the position of the Financial Director); 3. Major investments to strengthen the future position of Amsterdam RAI (the construction of the Amtrium at Scheldeplein, the future plans related to the parking garage and the possible development of a top hotel); 4. The dividend policy 2013-2018; 5. The refinancing; 6. The self-evaluation and composition of the Supervisory Board; 7. The result development and cost management. Change in composition Supervisory Board On 1 January 2013 the Supervisory Board had six members. For personal reasons, taking into account her daily tasks and the sum of her supervisory activities, Professor A.J.M. Roobeek decided to step down from the Supervisory Board as of 1 July 2013 at her own request. The temporary expansion from five to six members therefore came to an end and the composition has returned to five members, the number agreed upon by the shareholders. The personal information of the members is listed in the section ‘Composition of the Supervisory Board and Executive Board’ on page 12 / 13.
AMSTERDAM RAI
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STATEMENT OF THE SUPERVISORY BOARD
No regulation changes in report year
Supervisory Board regulations In December 2011 the Supervisory Board set revised regulations for the Supervisory Board of RAI Holding B.V. These regulations include the allocation of tasks and the working method of the Supervisory Board. An integral part thereof is the profile of the size and composition of the Supervisory Board, the schedule indicating when Board members will step down, and the regulations of the Audit Committee, Remuneration Committee and Selection and Appointment Committee. The regulations for the Supervisory Board are available on the website of Amsterdam RAI (www.rai.nl). Since their determination no further changes have been made to the regulations. Only the Audit Committee and the Remuneration Committee were active in 2013; the Selection and Appointment Committee will be composed as soon as it is required. Application statement On 16 December 2011 the Supervisory Board unanimously declared that it would apply and be bound to the obligations resulting from the regulations insofar as they are applicable to the Supervisory Board and its individual members. Any new members joining the Supervisory Board will also make this statement.
No non-independent Supervisory Board member
One transaction with conflicting interests; dealt with in accordance with regulations
No specific need for additional education
4 regular and 2 extra meetings with the Executive Board
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ANNUAL REPORT 2013
Independence The regulations state that in the composition of the Supervisory Board the members should be independent with the exception of a maximum of one person. All members qualify as independent members. Conflicting interests In 2013 there was one transaction in which there was a possible conflicting interest of the Supervisory Board or its individual members. It involved the (re)financing of the loan capital by the Rabobank. Supervisory Board member Mr Houterman is also a Supervisory Board member for Rabobank Amsterdam. The transaction was started under the usual conditions, and Mr Houterman did not take part in the discussion or decision-making process regarding the refinancing. Continuous education Every year the Supervisory Board evaluates for what aspects its members require further training or additional education during their term of office. In the year of review, the Supervisory Board assessed that no specific training or education, initiated by Amsterdam RAI, would be necessary in the short term. This will be re-evaluated in 2014. Meetings In 2013, the complete Supervisory Board held four regular meetings with the Executive Board. On 15 February it held an additional Supervisory Board meeting focused on Amsterdam RAI’s Real Estate Masterplan (including the Construction of the Amtrium) and the refinancing. On 7 February there was an extraordinary General Meeting of Shareholders at the request of the shareholders to discuss the situation involving RAI Langfords. There was also a separate Supervisory Board meeting prior to the regular meeting on 26 November focused on the future higher management structure of Amsterdam RAI.
STATEMENT OF THE SUPERVISORY BOARD
3 meetings without the Executive Board
Meeting between General Director and Chairman Supervisory Board
Meeting with Works Council
Meeting with management team
Approval Annual Plan 2014
Dividend policy, refinancing, real estate projects
Fixed dividend of € 2.24 million, indexed annually
Two house bankers: equal division of long-term loans and current accounts
The Supervisory Board also held three meetings without the presence of the Executive Board. Topics discussed in these meetings included the self-evaluation of the Supervisory Board, the extension of the statutory term of the Director, and the work and task division within the Supervisory Board after the General Meeting of Shareholders in April 2014. The Chairman of the Supervisory Board and the General Director met four times this calendar year to discuss progress. There were additional progress meetings over the phone. Twice a year, two Supervisory Board members attend a meeting of the Works Council of Amsterdam RAI. On 10 April, the attending members were Mr Mengelers and Mr Houterman, and on 4 November the meeting was attended by Mr Vermeulen and Mr Houterman. The annual meeting with the management team took place on 6 December 2013. Over lunch both the Directors and the Supervisory Board members had opportunities to ask questions and exchange information. The Supervisory Board expressed its intention to visit a part of the company once a year prior to a Supervisory Board meeting. Annual plans In its December meeting, the Supervisory Board approved the Annual Plan 2014 including the budget and investments. The Annual Plan will be presented to the General Meeting of Shareholders on 17 April 2014. Main agenda items The meetings with the shareholders about the new dividend policy and the refinancing of the debts of Amsterdam RAI took up a lot of the Supervisory Board’s time and effort. Additionally, the Supervisory Board closely monitored the progress of the real estate projects in 2013, resulting from the Spatial Future Vision RAI. New dividend policy The dividend policy work group, which included a strong representation of the share holders and the Executive and Supervisory Boards of Amsterdam RAI, discussed a new dividend policy for RAI Holding B.V. for the period 2013-2018. In December 2013 all parties agreed to several starting points for the new policy. It is expected that the dividend policy will be determined at the General Meeting of Shareholders in April 2014. The main result of the meetings is that RAI Holding B.V. will pay a total fixed dividend of € 2.24 million to its shareholders. Starting with the dividend of 2014, the payable dividend will be indexed annually based on the dividend of the previous year, and based on the consumer price index. The complete contents of the new dividend policy have been included in the section ‘Shareholder Equity and Loan Capital’ in the report of the Executive Board on page 63. Refinancing In addition to the existing banking relationship with the Deutsche Bank, Amsterdam RAI entered into a relationship with the Rabobank. At each of the two banks with which Amsterdam RAI has a club deal the RAI has € 28 million in long-term loans. In addition, Amsterdam RAI has concluded current account facilities at both banks with a value of € 15 million.
AMSTERDAM RAI
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STATEMENT OF THE SUPERVISORY BOARD
Provisions for four-star hotel with up to 800 rooms
Definitive approval for Amtrium, construction has commenced
‘On-site’ hotel has been a long cherished wish
Strategic choice for moment of transfer hotel: After design drawings
Financing for new parking garage available
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ANNUAL REPORT 2013
Spatial Future Vision The ‘RAI (Spatial) Future Vision’ report was developed and determined in 2011 in cooperation with the City of Amsterdam. This includes the possibility of a four-star RAI hotel with up to 800 rooms. Construction of the Amtrium The economic prospects in the second half of 2012 were reason for the Supervisory Board to re-evaluate the previous decisions regarding the new construction on the Scheldeplein (now known under the name Amtrium). Partly based on the findings from the Boer en Croon agency, the Supervisory Board was able to give its definitive approval for the building plans in February 2013. The construction is now underway. Investments in hotel and parking garage Amsterdam RAI has held the wish to realise a hotel on-site (on the premises of Amsterdam RAI) for over a decade. The strategic starting point for the hotel project is that ‘the hotel should be a high-quality facility that increases the attractiveness of Amsterdam RAI Convention Centre as a location for large, multi-day international events.’ There is a growing demand for an on-site hotel from international organisers and this is being increasingly recognised by Amsterdam RAI’s competitors. The Supervisory Board and Executive Board assessed which role Amsterdam RAI should play in the development of the hotel. Three models were evaluated related to the role and moment of involving a project develop / investor / operator. Amsterdam RAI can outsource the project as soon as the drawings have been completed, at the time of realisation or five years after delivery and use. In its September meeting, the Supervisory Board agreed to the plan of transferring the hotel project to an investor / operator at the completion of the drawings. Amsterdam RAI is currently in discussion with the City about a joint approach to the tender process. The Supervisory Board also assessed the first plans for the construction of a new parking garage. Several basic ideas have been mooted. The starting point for building the garage is that Amsterdam RAI will invest in and operate it. The new financing scheme includes € 20 million for the new parking garage. Should the construction be cancelled, a covenant has been concluded with the banks that this financing facility can be reduced.
STATEMENT OF THE SUPERVISORY BOARD
Other items In addition to the issues above, the following subjects were also discussed in the meetings.
3 scenarios
Policy outline memorandum 2013 – 2018 The policy outline memorandum 2013-2018 indicates the financial outlines for Amsterdam RAI in the near future. The Board developed three scenarios: A ‘basic-minus’, basic, and growth scenario. The growth scenario involves no loss of events. The basic scenario assumes the loss of a major event in 2016. This also applies to the basic-minus scenario, which additionally assumes that there will be no more BedrijfsautoRAI as of 2014. The figures included in the scenarios have given the Supervisory Board and Executive Board reason for further analysis. In this framework, the Board asked KPMG to perform a benchmark study into the profitability of organisers and exhibition and conference centres. Risk evaluation Amsterdam RAI has systems for risk analysis and control, and keeps the Audit Committee informed about these risks via updates. Once a year (in its September meeting) there is a plenary meeting regarding the risks with a detailed analysis of the various risks. This is further discussed and explained in the chapter on ‘Governance and Risk Management’ on page 70 in the report of the Executive Board.
Self-evaluation with external expert
Self-evaluation Supervisory Board The Supervisory Board performed a self-evaluation under the guidance of an external consultant. Based on this evaluation, the realisation of the various roles and functions and the composition and competences of the Supervisory Board members were discussed, which brought to light some differences in the realisation of the roles. These differences will be further evaluated by the Supervisory Board. The Supervisory Board also determined that the relationships among the members had been strengthened and that the individual members have a strong connection to Amsterdam RAI. The individual qualities of the members strengthen the Supervisory Board as a whole. Future higher management structure Amsterdam RAI In the division of the tasks of the Supervisory Board, it was decided that the Remuneration / Appointment Committee would focus on the profiles of the Executive Board, the management structure and the succession of the General Director after the General Meeting of Shareholders in April 2014.
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STATEMENT OF THE SUPERVISORY BOARD
Composition Audit and Remuneration Committees
Composition Supervisory Board after General Meeting of Shareholders in April 2014
Committee reports The Supervisory Board established an Audit Committee and a Remuneration Committee from its members. The Audit Committee consists of Mr Vermeulen (Chairman), Mrs Rijxman and Mr Van der Steen. The Remuneration Committee consists of Mr Houterman (Chairman) and Mr Mengelers. Mrs Roobeek (then Chairman) was also part of this Committee until 1 July 2013. Composition and division of tasks as of April 2014 Based on the Dutch Management and Supervision Directive, Mr Mengelers will step down as Chairman during the general Meeting of Shareholders in April 2014. He will be succeeded by Mr Vermeulen. It has also been decided that the composition of the Committees will change in accordance with the overview below as of April 2014:
Supervisory Board
Audit Committee
Remuneration Committee / Selection / Appointment Committee
F.I.M. (Ferry) Houterman
member
member
J.H.J. (Jan) Mengelers
member
S.J. (Shulamith) Rijxman J.W.Th. (John) Van der Steen J.R. (Hans) Vermeulen
Four meetings
Report and recommendations presented to Supervisory Board
Agenda items
Tender for new auditor
Two meetings
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ANNUAL REPORT 2013
Chairman Chairman member
Audit Committee The Audit Committee met on four occasions during the year of review. The meetings all took place prior to the regular Supervisory Board meetings. The topics discussed in these meetings have already been reported by the Chairman in the following meeting of the Supervisory Board. The Supervisory Board was also given recommendations on the decisions prepared by the Audit Committee and to be taken by the Supervisory Committee. In the year of review, the Audit Committee discussed, among other things, the quarterly results, Financial Statement 2012, Annual Plan 2014, policy outline memorandum 2013 - 2018, risk analysis, new financing scheme, new dividend policy and investments by Amsterdam RAI. At the recommendation of the Audit Committee, the Supervisory Board approved the plan of the Executive Board to initiate a call for tender in book year 2014 for the appointment of a new auditor starting in book year 2015. Remuneration Committee The members of the Remuneration Committee met frequently in the year of review. They discussed the extension of the statutory term of the General Director until 1 March 2016, after which he will step down as of 1 August 2016 due to retirement. They also discussed the termination of the employment contract of the former Financial Director. Various meetings were held with both Directors. In this framework there were two formal committee meetings.
STATEMENT OF THE SUPERVISORY BOARD
Two General Meetings of Shareholders in year of review
General Meeting of Shareholders On 7 February 2013 there was an extra General Meeting of Shareholders which mainly focused on the irregularities in the bookkeeping of RAI Langfords B.V. as determined in 2012, and the vision of the Supervisory Board on its supervision of the Executive Board of RAI Holding B.V. with regard to RAI Langfords B.V. The regular General Meeting of Shareholders came together on 12 April 2013 to discuss, among other things, the annual report 2012, determining the dividend of 2012, the Annual Plan 2013, the transfer of MECC Maastricht and the report on the extra meeting of the General Meeting of Shareholders on 7 February. On both occasions all members of the Supervisory Board were present, as were the General and Financial Director.
(Informal) meeting with shareholders
(formal) meeting with shareholders
There were also informal meetings with the shareholders. Every shareholder is normally kept up-to-date by the Executive Board and two members of the Supervisory Committee of the developments in Amsterdam RAI in spring and in autumn. This year there were more formal meetings related to the new dividend policy (2013 - 2018). Additionally, the Chairman and an individual member of the Supervisory Board had (separate) meetings with one of the shareholders at their request. Compliments and words of thanks The Supervisory Board (especially) compliments the employees and Board of Amsterdam RAI on achieving various (prestigious) Awards. Winning these Awards underlines the leading role Amsterdam RAI plays within the global MICE (Meetings, Incentives, Conventions & Exhibitions) industry. Despite the sombre prospects at the start of the reporting year, Amsterdam RAI managed to conclude the year with good financial results. We thank the RAI’s clients and shareholders for their involvement, and the Board, management and employees for their professionalism and efforts over the past year. Amsterdam, 27 March 2014 Supervisory Board RAI Holding B.V. J.H.J. (Jan) Mengelers, Chairman F.I.M. (Ferry) Houterman S.J. (Shulamith) Rijxman J.W.Th. (John) Van der Steen J.R. (Hans) Vermeulen
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“Whereas we labelled the ye ‘challenging’ in by the end of recorded outs results.”
had ar as being advance, 2013 we had tanding
The year 2013 was an exceptional one for Amsterdam RAI. With a record number of over 400,000 international visitors, a raft of sector-leading medical conferences and the start of the construction of the new Amtrium being among many highlights. At the same time we had to take into account the loss of AutoRAI, among others, in our annual turnover. The bottom line, though, is one of satisfaction with and appreciation of our organisation’s (commercial) effectiveness.
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Executive Board report
EXECUTIVE BOARD REPORT
Market developments
Various market developments influence Amsterdam RAI and its strategy and three of the most important are highlighted here. Firstly, the rise of the internet and social media, which influence our behaviour, the way in which we communicate and our need for physical contact. We then highlight the redistribution of economic power throughout the world and its effect on the changing international locations of sectors and communities. Finally, we examine the international positioning of Amsterdam in the exhibition and conference sector.
Changing methods of communication
Exhibitions and conferences must learn to anticipate change
Opportunities for trade exhibitions: meet, stimulate and inspire
How the internet and social media are changing our behaviour The arrival of mobile internet and social media has changed the way in which we communicate. The virtual world is developing increasingly rapidly: everyone everywhere is continuously online. Just like media companies, exhibitions and conference centres must learn to anticipate such changes. They are tasked with transforming and enriching themselves in such a way as to offer precisely the added value that sectors and communities expect from them. The traditional role of an exhibition and conference centre is changing. The number of visitors who are prepared to visit exhibitions as a matter of course in order to gain information on new products and developments is falling rapidly, while new target groups have other expectations and needs. The key question is whether the human need for physical contact will be replaced or stimulated by developments such as these. Whereas company representatives used to make weekly rounds of their clients to collect orders, this has been replaced by digital systems. Amsterdam RAI sees the reduction in the number of physical contact moments in business relationships as a great opportunity for trade exhibitions. An opportunity for different players within a sector to meet, stimulate and inspire each other. • Among others, Amsterdam RAI has noted the following concrete developments: • The initiative for organising events comes from the community and the role of existing institutions is in decline; • New networking tools are being developed: outside and on the exhibition floor; • The number of hybrid events is increasing: the virtual world is finding its way to the exhibition floor; • Alongside virtual meetings the need for physical meetings remains stable (growth is possible through the introduction of new networks); • The introduction of new networks will lead to more small-scale, spontaneous events; • Visitors expect more fun, genuine contacts and higher quality; • Competition and business is expected of cross-media businesses.
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EXECUTIVE BOARD REPORT
Market developments New economic powerhouses are growing at the expense of the European Union
The rise of new economic powerhouses is influencing the location of sectors and communities
Redistribution of global economic power A second development that is influencing the market for exhibition and conference centres within Europe is the redistribution of global economic power. The role played by the European Union in the global theatre of innovation and production is decreasing. Since the 1970s the most powerful European countries have clubbed together to form the G7, the policy organ for the leading industrialised nations. Russia became a member in 1998, forming the G8. In the meantime, a G20 has taken shape, consisting of the 19 countries with the largest national economies in the European Union. The growth of this policy organ resulted from a change in the world’s economic landscape. Brazil, Russia, India and China, the BRIC countries, occupy roughly a quarter of the world’s landmass, are home to 40% of the world’s population and enjoy an above average rate of economic growth. In the long term, these developments will have a strong influence on the organisation of international trade exhibitions and conferences. Globalisation and the emergence of new economic powers are influencing the home bases of sectors and communities. This, in turn, is influencing the share of the exhibition and conference market currently enjoyed by Western Europe.
Pharma code A large number of international conferences held in Amsterdam RAI Convention Centre consist of medical conferences. These conferences, some of which attract over 30,000 visitors, are under pressure from Dutch legislation and regulations concerning the acceptance of gifts in the pharmaceutical sector. These regulations insist that participants, regardless of their country of origin and the regulations that apply there, must wear different coloured badges excluding their participation in seminars, meetings and lunches, and restricting their access to (parts of) the exhibition centre. Amsterdam RAI is petitioning for viable and internationally aligned regulations.
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ANNUAL REPORT 2013
EXECUTIVE BOARD REPORT
Various opportunities for Amsterdam RAI Convention Centre
Organisation of exhibition titles: focus on consolidation of European and foreign trade exhibitions with potential spin-offs to Amsterdam
Amsterdam RAI sees opportunities for the Convention Centre arising from this development. It will focus on foreign acquisition in BRIC countries and other new economic powers. Greater emphasis will be placed on the fun factor in communications. In addition, Amsterdam RAI will increase its focus on attracting successful hub trade exhibitions (European market leaders), encouraging relationships with activity centres in other parts of the world. Furthermore, Amsterdam RAI aims to build strong relationships with specific countries. These relationships will be intensified by inviting decision makers in specific sectors to Europe and by exporting knowledge. Opportunities have also been identified in relation to the organisation of trade exhibitions and exhibitions. Acquisition will focus specifically on gaining titles resulting from European consolidation. When organising international trade exhibitions in distant countries a conscious choice will be made to target sectors with market leading potential within Europe, enabling the same titles to eventually be brought to Europe. Amsterdam’s changing position in relation to other EU cities A third development is the changing position of Amsterdam in relation to other European cities. Internationally speaking, this is based on the positioning of the Netherlands and in national terms, on positioning within the Randstad region.
Dutch government aims to differentiate the country internationally in ten sectors
Metropolitan Region identifies seven economic clusters
The Dutch government’s business policy aims to differentiate the country internationally in ten sectors: Agro-food, Horticulture and source materials, High-tech equipment and systems, Energy, Logistics, Creative industries, Life sciences, Chemicals, Water and Head offices. The Amsterdam Metropolitan Region identifies the seven economic clusters of: ICT, Creative industries, ‘Red’ life sciences, Business/financial services, Logistics and trade, Flowers and food, and Tourism and conferences. Amsterdam RAI already plays an important role in many of these sectors. The chosen spearhead sectors will be taken into account during acquisition and, wherever possible, approaches will be made together with various organisations that are also occupied with acquisition in these sectors.
Europe’s largest cities
Utrecht, The Hague and Rotterdam
10th place
Amsterdam RAI’s competitors Amsterdam’s most important competitors in the exhibition and conference market within Europe are the following cities: Barcelona, Copenhagen, London, Paris, Vienna, Stockholm, Berlin, Munich, Geneva, Milan, Madrid and Frankfurt. The most important national competitors are the cities of: Utrecht, The Hague and Rotterdam. Position in worldwide Congress City rankings Amsterdam currently occupies 10th place in the worldwide Congress City rankings, produced by the International Congress & Convention Association (ICCA). Among others, Amsterdam therefore finished behind Vienna, Paris, Berlin and Madrid.
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Strategy A leading, international role in the exhibition, conference and venue sector
Adapted strategy: three principles
Mission
The mission of Amsterdam RAI is to create maximum long-term and sustainable added value for all its stakeholders by playing a leading international role in the exhibition, conference and venue sector.
Strategy
In late 2011 the strategy of Amsterdam RAI was reformulated. The four main principles behind the new strategy are: • Operation and organisation: leveraging on/operating the buildings at Europaplein in Amsterdam in an optimal way by organising RAI exhibitions and letting to third parties; • Internationalisation: organising RAI exhibitions elsewhere, if it involves specific highquality sectors and communities therein. In terms of facilitation the focus is on large, multi-day exhibitions and conferences; • Virtualisation: from the conviction that physical meetings will continue to be relevant and strengthened by virtual innovation, Amsterdam RAI aims to build a stronger position online to facilitate contacts with sectors and communities throughout the year, even outside of the large exhibition and conference dates.
Looking back Plans concluded: largely realised
RAI Langfords
MECC Maastricht transferred to City of Maastricht
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ANNUAL REPORT 2013
Strategic plan 2008-2013 The Strategic Plan 2008-2013 has largely been realised, including the implementation of yield management, the shedding of smaller exhibitions and the strengthening of Amsterdam RAI’s position in important growth sectors. With the construction of the Elicium the square metres of floor surface has been increased, and Amsterdam RAI has been given a new facade. An ERP system, called EBMS (Event Business Management System), was implemented organisation-wide. We also worked on strengthening the company, including through the development and implementation of the RAI Masters training programme. During this period there was a major focus on improving the organisation and the corporate culture and putting an increased spotlight on client groups. Transferring participations Over the years the activities of publisher RAI Langfords B.V. did not lead to the expected synergy with the exhibition activities. Partly due to internet and the growth of social media, Amsterdam RAI aims to approach target groups outside physical exhibition dates in a different way. Moreover, it was found in 2012 that the publisher had presented better financial results than was actually the case. The activities of RAI Langfords B.V. were disposed of on 1 January 2013. The ending of the lease contracts with MECC Maastricht gave Amsterdam RAI cause to reconsider its strategic position in MECC Maastricht. It was decided to transfer the activities of MECC Maastricht to the City of Maastricht, realised by means of an assets / liabilities transaction in 2013. A start was also made with the disentanglement of systems and activities. It is expected that this process will be finalised by the end of 2014.
EXECUTIVE BOARD REPORT
Programmes support implementation and provide synergy
Solutions are an important tool for increasing added value
Expanding market position elsewhere in the world
Focusing on China
Including the Amsterdam organisation in internationalisation
Being a frontrunner in the integration with new media
Three strategic programmes
Amsterdam RAI has three strategic programmes that support the company in the implementation of strategy and the achievement of further synergy benefits between divisions. 1. Improving integral services, increasing added value (‘more solutions’) Under the name ‘More solutions’ Amsterdam RAI started a programme aimed at improving the client-oriented provision of (total) solutions for organising and facilitating events. These solutions link the needs of the clients to the services, or ‘products’ provided by the various departments of Amsterdam RAI Convention Centre. The solutions increase the added value of Amsterdam RAI for the clients and increase profits per m2 during an event. Despite the reducing costs of exhibitions and stands for exhibitors, it allows Amsterdam RAI to generate more turnover at the expense of third parties (hired by exhibitors). 2. International focus on strong countries and sectors (‘more international’) Amsterdam RAI aims to further expand its brand familiarity and market position elsewhere in the world. This involves large countries which are seeing substantial growth and accommodate decision-makers for international exhibitions. Focus country To work effectively, Amsterdam RAI is focusing on a single country, namely China. Amsterdam RAI will be spending more time, money and human resources on the strategic relationship with China, including by developing marketing activities to promote the city of Amsterdam and the exhibitions and conferences of Amsterdam RAI. Optimising hospitality In addition to the activities in the focus country, Amsterdam RAI wants to bring the organisation in Amsterdam into the internationalisation process by seeking strategic partnerships with parties in the focus country and by integrating as standard the language and client demands of the country in the exhibition concepts and communication in Amsterdam. This could include, for instance, signs, catering, hostesses, the setup of the service desk, and support in arranging visas. The diversity policy for personnel also includes employing people from the focus country. 3. Improving online platforms, new media and virtualising meetings (‘more virtual’) The role of the virtual meeting is increasing and the virtual world is expanding every day. To address this issue, Amsterdam RAI has included the principle of ‘Virtualisation’ in its strategy. The physical and virtual worlds are linked via: • Connectivity: the technology of connecting virtual and physical meetings. Amsterdam RAI provides WiFi via mobile hotspots and is simultaneously working on the introduction of high density WiFi which will allow a maximum number of people to be connected per m2, on increasing the bandwidth, for instance by utilising the infrastructure of optical glass fibre, and on expanding the possibilities for data connection via mobile networks. If thousands of RAI visitors want to watch a streaming video offered by the exhibitors at the same time, Amsterdam RAI is expected to be able to facilitate this technology.
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Strategy • Support: exhibitions and conferences are further supported by digital services. Issues Amsterdam RAI currently has implemented include registration, parking, access and payment technologies, the client portal for exhibitor information, interactive floor plans and a stand configurator. New developments will mainly involve the personification of the exhibition experience among both exhibitors and visitors, via, for example, ‘smart’ event badges and name tags, digital wayfinders and personified web pages. • Enhance: enhancing virtual meetings with virtual applications. Amsterdam RAI already offers Twitter streams via conference screens and links based on QR codes. In 2013 Amsterdam RAI completed an innovative 360o app which allows organisers and exhibitors to watch their events ‘live’ before they actually occur. New developments are focused on personal narrowcasting, location-based advertising on the exhibition floor, and virtually linking exhibitors to visitors on the floor. • Reach: increasing the reach of the physical exhibition and conference reality by integrating it into the virtual reality; for example by means of social media and the live streaming of exhibition events and interviews. • Generate: stimulating the demand for physical meetings by establishing virtual meetings. Amsterdam RAI has realised various types of interaction in this field with social media. A fully virtual exhibition is one of the products that could still be realised within this framework.
Multi Venue Management ‘Multi Venue Management’ involves realising management and operations over a range of exhibition, conference and event buildings (‘venues’). Multi Venue Management contributes to both the ‘more international’ and ‘more solutions’ concepts. The benefits of Multi Venue Management for Amsterdam RAI are: • building up knowledge on the management of multiple locations, in which the RAI’s benchmarks can contribute to faster learning and improvements. • fulfilling the role of international host for large organisers, in which the contacts of Amsterdam RAI and processes remain the same while the locations change; • further improving the reputation of Amsterdam RAI, as well as our track record and, in the long term, profitability. Amsterdam RAI performed various studies into Multi Venue Management which resulted in the identification of four varieties: consultancy, partnership, participation and complete management. Amsterdam RAI has decided to focus for now on consultancy activities.
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ANNUAL REPORT 2013
EXECUTIVE BOARD REPORT
Knowledge leadership: RAI Insights Amsterdam RAI has extensive experience in the field of organising and facilitating exhibitions and other events. The company aims to play a leading role and publishes trend reports in a series of publications under the name ‘RAI Insights’.
HOW CAN YOU BEST TUNE YOUR EXHIBITION/EVENT TO THE NEEDS OF GENERATION X AND Y?
Generation X and Y The first report focused on the changing demands of Generation X and Y was published in spring 2013. The result is a document full of interesting insights into X & Y, and concepts and ideas for innovating and ‘future-proofing’ exhibitions and events. The generation insights are based on socio-cultural trend analyses. The qualitative research was performed among visitors of business-to-business and consumer exhibitions. The analyses and concepts were developed in view of exhibitions, conferences and other events.
HOW TO BRING YOUR EXHIBITION/EVENT IN LINE WITH THE DIGITAL CONNECTED SOCIETY OF THE 21ST CENTURY
Connected Society The second publication was published in the autumn. This trend report focuses on the characteristics and preferences of the ’Connected Society’: a society in which technology enables connections between everyone and everything at any time. Related to exhibitions and other events this means that the Connected Society always wishes to be in direct contact with the event organiser, other visitors and relevant exhibitors; preferably before, during and after the event. Amsterdam RAI partnered with TrendsActive and Ruigrok | NetPanel to map the changing demands and wishes of Generation X and Y in the document ‘How can you best tune your exhibition / event to the needs of generation X and Y.’ The report can be downloaded via the website of Amsterdam RAI. www.rai.nl
AMSTERDAM RAI
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EXECUTIVE BOARD REPORT
CSR policy Eight years ago Amsterdam RAI gave sustainability a prominent place within the organisation via a new core value: ‘The RAI achieves sustainable results’. A lot has happened since then as Amsterdam RAI has become one of the frontrunners in the sustainability field within its sector. Renowned trade associations such as UFI and HSMAI have presented the RAI with international awards for its sustainability policy. The results are published in a separate annual sustainability report.
One of the visible frontrunners in the field of CSR in Europe
Ambition Amsterdam RAI sees that an increasing number of organisations are focusing on corporate social responsibility. This is a positive development as it lifts the entire sector to a higher level. Amsterdam RAI aims to play an exemplary role with its CSR policy. The renewed CSR ambition defined by Amsterdam RAI in 2013 states the following: ‘In the next five years, Amsterdam RAI has the ambition to be one of the visible frontrunners in the field of sustainability in the conference and event industry in Europe.’ Policy areas
15 focus areas
Amsterdam RAI’s new CSR policy distinguishes between 15 policy areas, as indicated below. CSR policy areas 1. Employees 2. Waste 3. Energy 4. Water 5. Mobility 6. Emissions 7. Certifications 8. Procurement
Report available on the website
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ANNUAL REPORT 2013
9. Products 10. Catering 11. Cleaning 12. Event content 13. Visibility of CSR activities 14. Social involvement 15. Anchoring CSR in the organisation
Individual Sustainability Report Every year Amsterdam RAI publishes an individual sustainability report. The most recent edition (2012) is available on the website: www.rai.nl (About Amsterdam RAI, Sustainability).
EXECUTIVE BOARD REPORT
Results in 2013 With a turnover of € 116.6 million, Amsterdam RAI had a positive result of € 3.3 million. The 15 per cent drop in turnover was mainly the result of the shedding of the activities of MECC Maastricht and RAI Langfords and the cancellation of the AutoRAI. Amsterdam RAI also achieved good results from a commercial and a social perspective.
Turnover dropped 15 per cent, result increased by 60 per cent
Financial The turnover of Amsterdam RAI was € 116.6 million (2012: € 134.7 million), which represents a drop of 15 per cent compared to the previous year. This reduction can be entirely explained by the shedding of the activities of MECC Maastricht and RAI Langfords and the cancellation of the AutoRAI. Compared to the uneven year of 2011, which had a similar exhibition programme, this represents a turnover reduction of 12.7%. The result however increased by 60% from € 2.1 million to € 3.3 million.
Key financial data 2013
2012
2011
2010
2009
Turnover
116.6
134.7
133.6
125.0
108.1
EBITDA
22.4
21.7
22.8
26.3
17.3
Operating results
7.1
6.0
7.8
11.6
4.4
Net results
3.3
2.1
3.1
5.7
0.2
Shareholder equity
77.7
76.4
76.3
76.5
70.9
Balance sheet total
189.9
196.2
203.9
208.0
210.6
Provisions
0.7
6.5
4.8
5.0
4.1
Net investments*
5.6
11.1
10.3
6.6
17.8
Operating results as % of turnover
6.1%
4.5%
5.8%
9.3%
4.1%
Senior Net Debt / EBITDA
2.75
2.79
2.48
2.75
4.25
40.9%
38.9%
37.4%
36.8%
33.7%
Results (€ x 1 mln)
Ratio’s
Solvency
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EXECUTIVE BOARD REPORT
Results in 2013 2013
2012
2011
2010
2009
RAI-organised events
39.3
52.5
53.6
48.5
34.1
Letting to third parties
23.6
23.2
23.5
21.6
26.4
Catering
17.8
16.9
18.1
17.5
14.1
0
3.2
4.0
5.0
5.3
35.9
38.9
34.4
32.4
28.3
116.6
134.7
133.6
125.0
108.2
RAI-organised events
33.8
39.0
40.2
38.8
31.5
Letting to third parties
20.2
17.2
17.6
17.3
24.4
Catering
15.3
12.5
13.5
14.0
13.0
0
2.4
3.0
4.0
4.9
30.7
28.9
25.7
25.9
26.2
100.0
100.0
100.0
100.0
100.0
Turnover (€ x 1 mln)
Trade journal publications Other** Total
Turnover (%)
Trade journal publications Other** Total
* buildings, installations and inventory ** includes, among other things, parking funds, hotel commissions and facility services
Cost reduction
Less outsourcing, lower personnel costs
Investments: buildings, installations, inventory, ICT, exhibition titles
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Costs The total operating costs in 2013 were € 109.5 million, a drop of € 19.2 million compared to the previous year. The cost reduction was largely the result of a strong fall (€ 11.3 million) in the costs for outsourcing and other external expenses. The sale of the activities of RAI Langfords on 1 January 2013 also resulted in lower personnel costs. The amortisation costs in the past year amounted to € 15.3 million (€ 15.8 million in 2012). In the past year Amsterdam RAI invested € 5.6 million in buildings, installations and inventory as well as € 0.7 million in software and € 0.1 million in the acquisition of exhibition titles. Due to the busy event calendar the occupancy rate in the summer was so high that there was less time for renovations, resulting in a lower investment level in 2013 than usual. In this framework investments to the tune of € 1 million – originally planned for 2013 – were realised in 2012.
EXECUTIVE BOARD REPORT
Financing costs
The interest costs were € 3.1 million, a reduction of 9% on last year due mainly to the repayment of loans and the refinancing operation. The agreed ratios with the bank were realised, as they were in previous years. The shareholder equity/loan capital ratio was 69.3% (2012 63.8%), which can be qualified as healthy.
Long-term land lease costs
The expansions of the RAI complex over the past decades have resulted in Amsterdam RAI having to deal with a multitude of long-term land lease contracts with varying costs and termination dates. We have come to an agreement with the City of Amsterdam about a single new overall long-term land lease contract to replace the various previous contracts. The costs of the new lease have been fixed until 1 November 2028.
fixed until November 2028
Operating results Net profit
The operating results were € 7.1 million (2012: € 6.0 million). After the deduction of the interest costs and taxes, the net profit over 2013 was € 3.3 million compared to € 2.1 million in 2012. International event days In the past year, Amsterdam RAI Convention Centre saw 271 event days with international events (in 2012: 265 and 2011: 264 days).
477 events with over 400,000 international visitors
The great switch
The Great Switch
Client and commerce Despite the continuing recession in 2013, Amsterdam RAI managed to attract over 400,000 international visitors to some 477 events. This high (record) number can mainly be attributed to the increasing number of medical conferences and events related to information technology and energy. September 2013 was not only a record month for Amsterdam RAI with over 100,000 international visitors - it was also the month that marked ‘The Great Switch’. In less than 38 hours a unique switch from conference to exhibition infrastructure was realised. Through two years of careful planning and alignment with partners and other suppliers, and led by a dedicated team of Board members and managers of Amsterdam RAI,
IPad App virtual tour
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Results in 2013 there was a seamless conversion between the programming of cardiology conference ESC and broadcasting exhibition IBC. The spectacular switch was captured on film and is now available on YouTube (http://goo.gl/4ebWLK). Virtual tour
Proactive benchmark
I amsterdam approved
Other Awards
EarthCheck Gold status
Amsterdam RAI introduced a new app for the iPad in May which offers organisers a virtual tour of the complex. The app allows them to see and hear events in the halls and other exhibition spaces as if one was actually there. This makes Amsterdam RAI the world’s first convention centre with this type of Virtual Tour App with panoramic 360 degree video. The app also includes functions such as videos and photos from previous events that can inspire organisers in the development of their own events. To maintain its leading position it is important to regularly monitor competing venues and market leading international events. In addition to regular benchmarks this has been realised since the autumn of 2013 via a so-called proactive benchmark. The goal of the proactive benchmark is to show best practices of venues and events as inspiration for innovation at Amsterdam RAI. It zooms in on international venues for market-leading international events in the focus markets. The information is collected by employees who visit these global venues/events and study specific issues. The information collected by the employees gives a good impression of a varied range of venues and events that are not always included as standard in regular benchmarks; a realistic sketch of the ‘real’ image: not a brochure or website information, but right from the exhibition floor. The proactive benchmark provided interesting ideas in 2013, some of which will be tested and possibly implemented in the RAI Convention Centre in 2014. Since April 2013 Amsterdam Marketing has been giving a quality label to Amsterdam business hotels (‘I amsterdam approved’) that cooperate in the large events in the RAI Convention Centre. This gives conference or exhibition organisers the certainty of the available amount of rooms they need for their event. The rooms can be booked via RAI Hotel & Travel Service. Amsterdam RAI achieved various awards in 2013, for instance in London during the M&IT Industry Awards 2013 where it won the bronze ’Best Overseas Convention Centre’, and two bronze awards at the Meetings Industry Marketing Awards 2013 for ’Best Use of Video Marketing’ and ’Best Digital Marketing Campaign’. Society As the first exhibition and conference centre in Europe (and only the second worldwide), Amsterdam RAI was awarded the EarthCheck Gold status. EarthCheck is the world’s leading sustainability certification in the corporate tourism sector. The EarthCheck Gold status underlines the leading role of Amsterdam RAI in the global MICE industry with regards to sustainability.
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EXECUTIVE BOARD REPORT
AIPC Gold certificate
In addition to acquiring the EarthCheck Gold sustainability certificate, Amsterdam RAI also obtained the AIPC Gold certificate in November 2013. AIPC - the International Association of Conference Centres – represents professional conference and exhibition centres. In receiving this certificate Amsterdam RAI joins a Group of 24 other conference centres with international accreditation in the field of quality, facilities and social responsibility.
Europa Hall protected
The Europa Hall and the advertising pillar on the square in front of the RAI (the ‘RAI sign’) have been nominated as protected national monuments (within the framework of the postwar reconstruction of the Netherlands 1959-1965). A selection was made of approximately 2.5 million buildings and structures from the relevant period, in which the Cultural Heritage Agency was led by contributions from municipalities, the heritage sector and experts. The nominated monuments were selected as examples of the versatile history, architecture and art from early post-war the Netherlands. In view of the unique shape of the Europa Hall it is not expected that the protected status will interfere with its operations.
national monument
Europa Hall and the ‘RAI Sign’ are nominated as protected national monument
Solar panels
Solar panels on the roof of Hall 8
The roof of Hall 8 of Amsterdam RAI has been equipped with 1,632 solar panels that produce 360,000 kiloWatt hours: comparable to the annual electricity supply of 140 Amsterdam households. The solar panels result in a CO2 reduction of around 150 tonnes a year. Amsterdam RAI is looking into the possibility of covering other parts of the complex with solar panels as well. The RAI Amtrium that is currently being built will also be equipped with solar panels (see also page 52).
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AMSTERDAM RAI STIMULATES CITY AND REGION Amsterdam RAI stimulates the economy in the city and region. Hotels, restaurants, museums, transport companies, suppliers and the airport benefit from the large number of exhibitors and visitors who visit the city due to the (often international) exhibitions, conferences and events.
EXECUTIVE BOARD REPORT
Events
487 events in total
23 RAI-organised events
In 2013 Amsterdam RAI organised and / or hosted no fewer than 487 events, 477 of which took place at the Amsterdam RAI Convention Centre and ten abroad. Alongside the ten RAI-organised events in foreign countries, Amsterdam RAI also organised 13 of the events held at the Amsterdam RAI Convention Centre. These so-called ‘own titles’ are owned and organised by Amsterdam RAI itself.
RAI-organised events
The RAI Exhibitions division is responsible for the development and realisation of its own events. It organises a total of around 25 national and international consumer and trade exhibitions, supported by a worldwide network of offices and agencies. Successful event formats based in Amsterdam are also duplicated abroad (as spin-offs), in partnership with sector and media organisations. Around half of Amsterdam RAI’s turnover is derived from its own events. Through a clear focus on first-class events, along with its knowledge of markets and target groups, Amsterdam RAI has become the global market leader in five sectors: water technology (Aquatech), traffic technology (Intertraffic), professional cleaning (ISSA/INTERCLEAN), the maritime sector (METS) and remanufacturing (ReMaTec). 2013 overview • Within the category of international trade exhibitions, ReMaTec performed far above expectations. METS also performed well and although Aquatech did not fully match expectations, it performed better than the previous edition in 2011. • Although there was no growth in national trade exhibitions, the results were much better than anticipated. This was mainly due to increased turnover (generated by Exhibitor Services) and strict cost management. • In June 2013 the establishment of a branch in China (RAI China) became a reality. The implementation of a new Chinese joint venture structure with partner CHC was not yet realised in 2013 but will take shape in 2014. • The agency network expanded in 2013 with new agencies in Germany, USA, Spain, Latin America and Eastern Europe. In addition, an agreement has been signed with a Chinese partner to expand the agency network in the Asia / Pacific region. Despite the financial crisis, the agency network results were very good. Around 55% of RAI Exhibitions’ international turnover is derived from this network. • After an intensive period of preparation, RAI Exhibitions launched the International Horticultural trade exhibition, GreenTech, the first edition of which will be in June 2014 (see also page 46). • A further success story is the collaborative agreement between the FietsVak cycling trade exhibition and the Cycling and Walking trade exhibition (see also page 44).
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Events
• New elements were added to existing trade exhibitions, such as the Classic Vessels addition to HISWA and Ethnic Foods’ inclusion in Horecava. • Amsterdam RAI (Building Holland) and the knowledge platform Sustainably Built are combining their strengths to organise the new-style Building Holland trade exhibition, which will be held for the first time at Amsterdam RAI Convention Centre in May 2014 (see also page 46). • The former RAI Langfords products Rematec News and Amsterdam Courtesy Passport (ACP) have been successfully integrated and are meeting their targets. • Regrettably, the prevailing economic conditions within the sector in November 2012 led Amsterdam RAI to cancel the AutoVakRAI and AutoRAI events originally scheduled for 2013. Aquatech; also in China, India and USA
• Much work has been put into ensuring the future of BedrijfsAutoRAI (the commercial vehicle trade exhibition). The event will not take place in 2014 but is scheduled for 2015. • The Bakery Days exhibition will be integrated with the Bakers trade exhibition and Easy Fairs, thus ending Amsterdam RAI’s association with Bakery Days. Self-organised events at RAI in 2013 In 2013 RAI Exhibitions organised the following events at the Amsterdam RAI Convention Centre:
RAI-organised events: 4 international trade exhibitions, 3 national exhibitions, 5 national trade exhibition
International trade exhibitions
National exhibitions
National trade exhibitions
National conference
Aquatech
Huishoudbeurs
Horecava
Green Buildings Holland
METS
Negenmaandenbeurs
FietsVAK
SuperYacht Pavilion
HISWA Boat Show
Safety & Security
and 1 national conference
ReMaTec
Taxi Expo Fleet Expo
International trade exhibitions With the exception of Aquatech Amsterdam, all international trade exhibitions organised in 2013 were able to attract more visitors and exhibitors than their previous editions. International trade exhibitions Aquatech Amsterdam: strong international orientation
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With 742 exhibitors and around 18,500 visitors (slightly fewer than the previous edition), the 24th edition of Aquatech Amsterdam once again demonstrated that it is the ultimate platform for the national and international water technology sector. In combination with International Water Week and the Industrial Leaders Forum (which together attracted more than 1,000 participants), Aquatech Amsterdam proved to be a highly inspirational event for all representatives of the water technology sector. Around 60% of visitors came from 140 countries worldwide and special delegations from 40 different countries attended the event with the support of the Dutch government.
EXECUTIVE BOARD REPORT
METS: stable
ReMaTec: strong growth
National exhibitions maintain reasonable performance Huishoudbeurs attracts slightly fewer visitors
HISWA: good performance despite slightly fewer visitors and exhibitors
National trade exhibitions: fewer visitors but an increase in the quality of contacts
Horecava: A-status in the hospitality sector
METS (Marine Equipment Trade Show) is the world’s largest and best-attended trade exhibition for pleasure-craft equipment, materials and systems. The trade exhibition also included the SuperYacht Pavilion, the central platform for the global superyacht industry. A further two specialist pavilions were also erected: Marina & Yard Equipment and Construction Materials. More than 20,000 visitors (up 4.5% on the previous year) from over 100 countries attended the 2013 event, which attracted more than 1,300 exhibitors. ReMaTec is the largest and most important trade exhibition in the field of auto parts overhauls and heavy-duty remanufacturing. It takes place every two years and is supported by the sector’s most important trade organisations: APRA (Auto Parts Remanufacturers Association) and FIRM (International Association of Engine Rebuilders and Remanufacturers). The principal visitor groups are automobile manufacturers, importers and remanufacturers, and their suppliers. The results of the 2013 edition showed a marked improvement on those of the previous edition in terms of the number of visitors (+29%), the number of exhibitors (+21%) and the square metres of exhibition space used (+25%). National exhibitions In terms of visitor numbers, national exhibitions have maintained a reasonable performance, despite the economic crisis. The 2013 Huishoudbeurs (which also includes the Negenmaandenbeurs) attracted slightly fewer visitors than the previous edition (244,911 compared to 246,998 in 2012) to see the latest trends in the fields of beauty, fashion, leisure, cleaning, interior design, food and babies & pregnancy. Visitors spent an average of € 100 in 2013. The Huishoudbeurs has its own Facebook community with over 50,000 members. Update: in February 2014 the Huishoudbeurs and Negenmaandenbeurs together welcomed about 220,000 visitors. The HISWA Amsterdam Boat Show experienced a slight drop in the number of visitors (-2.6%) and exhibitors (-3.1%) in 2013. Given the fact that this sector is experiencing greater economic pressure than most, these figures represent a solid performance. Update: the March 2014 edition of the HISWA Amsterdam Boat Show produced similar, slightly lower results. However, a survey of exhibitors showed that more quotations and sea trials were requested than in the previous edition and, indeed, more boats were sold. National trade exhibitions National trade exhibitions also reflected economic circumstances in their various sectors. All trade exhibitions attracted fewer visitors in comparison with their previous editions but exhibitors remarked on a noticeable improvement in the quality of visitors: a higher number of actual decision makers and companies were in attendance. Horecava once again reinforced its A-status in 2013. A total of almost 53,000 professionals visited the national trade exhibition for the hospitality industry. This is a lower number than in the record year of 2012 but considerably higher than the 2011 edition. Sustainability, innovation and changing processes in business operations were the central themes of the event. Update: in January 2014 Horecava was able to attract over 57,000 visitors.
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Events
FietsVak 2013: reduction in dealer interest
FietsVak 2014 combined with Cycling and Walking trade exhibition
Safety & Security on track
Fleet Expo: more visitors
Taxi Expo
FietsVAK is the inspirational annual trade event for the bicycle manufacturing sector. FietsVAK 2013 provided an accurate reflection of current trends within the cycling sector. With over 40 new exhibitors, many product innovations and new bicycle models, the exhibition provided a comprehensive overview of the ingenuity and creativity present within the sector. Unfortunately, however, interest among dealers proved to be less than for the previous edition in 2012. In 2014, therefore, FietsVAK also opened its doors to consumers. This was made possible by combining the event with the Cycling and Walking trade exhibition, which was held simultaneously at Amsterdam RAI. FietsVAK was moved from January to March. On Saturday 1 and Sunday 2 March it became a successfully integrated part of the Cycling and Walking trade exhibition, which is open to consumers. On the following two days FietsVAK was open to trade visitors only. The Safety & Security Amsterdam (SSA) trade exhibition is the biennial meeting point in the field of security and (fire) safety. The 2013 edition of SSA may have received fewer visitors but with an increase in decision-making visitors, more and larger companies represented (also from outside the safety sector, including the retail and health sectors) and an increase of 22% in international visitors, the event remains well on track. Fleet Expo is the annual, innovative, networking platform for fleet, lease and mobility management. With 38 exhibitors, various premiers, a highly appreciated conference on smart mobility and 661 visitors, the event experienced a growth of 18% compared to the previous edition. Taxi Expo has become a proven, high-value meeting place and knowledge centre for professionals in the field of small-scale passenger transport. The trade exhibition, for which Amsterdam RAI worked in close cooperation with KNV Taxi and Challans & Faber, covered all aspects of this broad transportation sector and attracted 1,532 visitors (1,907 in 2012).
Visit Connect improves exhibitor returns ‘Visit Connect’ was introduced as a pilot scheme during SSA 2013. The tool provides exhibitors, organisers and other interested parties with a clear insight into the effect of and returns on trade exhibition participation. The software helps exhibitors and participants to gain maximum ROI through comprehensive data collection and live reports. Using the tool, exhibitors were able to generate direct leads at their stands by scanning
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visitor badges with a scanner or smartphone. Around 75% of exhibitors made active use of this lead generator, scanning around 7,000 visitors - an average of 56 scans per exhibitor. The participating exhibitors were positive about the new technology and the next event to use Visit Connect will be GreenTech 2014. After that, Visit Connect will be rolled out all RAI Exhibitions trade exhibitions in the Netherlands.
VERSLAG VAN DE DIRECTIE
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Events
Green Buildings Holland 2013
New ‘in-house title’: GreenTech
Building Holland 2.0
National conference In a unique cooperation, the trade exhibition Building Holland and Corporate Facility Partners (CFP) organised the Green Buildings Holland 2013 conference on 19 September, during the Dutch Green Building Week. Various distinguished speakers outlined their vision in the field of profitable sustainability in an international context. Astronaut André Kuipers, Wiebe Draijer, Chairman of the Social Economic Council, and Prince Carlos de Bourbon de Parme, a well-known advocate of sustainability initiatives, attended the conference as keynote speakers. They underlined the importance of sustainability to the competitive strength of the Netherlands as a whole, and green buildings in particular. New self-organised events at Amsterdam RAI Convention Centre from 2014 Good nutrition and well-being are crucial to the quality of life. A growing world population calls for sustainable production and the protection of scarce resources. Farming technology can obviously make an important contribution to this. The brand new biennial GreenTech event, held at Amsterdam RAI, aims to be the primary global meeting place for all professionals interested in agricultural and floricultural technology. The first edition of GreenTech takes place in June 2014. The existing trade exhibition Building Holland is due to be revitalised. From now on, RAI Exhibitions and knowledge platform Duurzaam Gebouwd (sustainably built) will work together to organise the platform for decision makers in the construction and real estate sectors. This industry-wide event (which will keep the name Building Holland) brings together all links in the chain to provide a concrete vision of the future for the construction and real estate sectors. It will be characterised by a unique co-creation concept. As well as actively contributing to the relevant subjects and proposing leading keynote speakers, standholders will also be responsible for the overall success of the event by using a unique invitation form. The new-style Building Holland trade exhibition will take place for the first time in May 2014.
Innovation Lab Innovations and new products are an important reason to visit trade exhibitions. Exhibitors usually have a lot to share and Amsterdam RAI plays an increasingly important role in helping the business world spread its news. In connection with this, Amsterdam RAI has formed strategic partnerships with knowledge institutions such as TNO.
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Using a generic formula, which can be tailored to a specific sector per trade exhibition, the Innovation Lab will be rolled out over the coming years. The Innovation Lab will be afforded a prominent position at various trade exhibitions and different parts of the formula will be tested at six trade exhibitions in 2014.
EXECUTIVE BOARD REPORT
Aquatech, Intertraffic and ISSA/INTERCLEAN spin-offs
RAI-organised events in foreign countries in 2013 RAI Exhibitions was the (co-)organiser of 10 international trade exhibitions on foreign soil in 2013. Of these, eight were spin-offs of trade exhibitions also held at Amsterdam RAI Convention Centre. The remaining trade exhibitions (FlowEx China and WaterEx Beijing) are associated with the spin-off Aquatech China. The three titles to produce foreign spinoffs are Aquatech, Intertraffic and ISSA/INTERCLEAN. Aquatech
Intertraffic
ISSA/INTERCLEAN
China
China
Mexico
India
India
Poland
USA
Turkey
In terms of visitor numbers and results, Aquatech China was the most important spin-off. FlowEx China was organised simultaneously, next door in the same Shanghai conference centre. The Intertraffic trade exhibition held in Turkey (Intertraffic Istanbul) also produced pleasing results. New RAI-organised events outside the Netherlands in 2014 During 2013 preparations were made for the following new spin-offs, which will form part of the 2014 programme. ICOMIA World Marinas Conference
ReMaTec USA
RAI Exhibitions will be the co-organiser of the ICOMIA World Marinas Conference in Istanbul; a spin-off of the METS trade exhibition. This event will be held in June 2014. ICOMIA stands for the International Council of Marine Industry Associations. More than 350 marine professionals are expected to attend in order to network, exchange ideas and do business. The ReMaTec and APRA trade exhibitions are joining forces to organise a new, leading ‘Trade Exhibition & Premier Networking Event’ for the (automotive and heavy duty) remanufacturing industry. The event will take place for the first time in November 2014 in Las Vegas under the name Big R/ReMaTec USA.
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Events
ISSA/INTERCLEAN Istanbul
ISSA/INTERCLEAN is spreading its wings to Eurasia. Following successes in Mexico and Poland, the international trade exhibition for the professional cleaning sector has set its sights on Istanbul. Floor care machines, paper, chemicals, sustainability and cleaning services for the health industry will be five of the most important topics covered by this new, biennial exhibition, which is expected to attract more than 150 exhibitors and 3,500 visitors from the region.
Third-party events
In addition to its own exhibition titles, Amsterdam RAI facilitates a growing number of national and international exhibitions, conferences, corporate events and other events organised by third parties. The multifunctional conference centre is also let out as RAI theatre for stage productions. The conferences and exhibitions organised in Amsterdam RAI Convention Centre can be divided as follows: Organised by third parties
total conferences and exhibitions = 82 9 13 10 17 33
33 international conferences
Cardiology conference ESC a huge success
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national consumer exhibitions national trade exhibitions international trade exhibitions national conferences international conferences
In the year under review Amsterdam RAI Convention Centre hosted 33 international conferences, including a large number of medical conferences. Visitor numbers varied greatly, from low to extremely high with over 30,000 visitors. Three medical conferences are further discussed below. International conferences organised by third parties In early September 2013 Amsterdam RAI was the setting for the largest medical conference in Europe: the 2013 edition of the European Society of Cardiology (ESC). Over five days Amsterdam welcomed more than 30,000 participants, speakers and representatives from more than 150 countries. ESC is known as the largest medical conference in Europe and the largest cardiovascular conference worldwide. Amsterdam RAI showed that it can easily accommodate over 30,000 cardiology professionals. The direct connection to Schiphol Airport and the city centre of Amsterdam, top-quality facilities of Amsterdam RAI and attractive ambiance of the city itself were shown to be the perfect ingredients for a successful cardiology conference.
EXECUTIVE BOARD REPORT
Oncology conference ECC opened by King Willem-Alexander
New type of e-posters used during thrombosis and haemostatis conference
SAP TechEd chose Amsterdam over Berlin
Largest national conferences welcomed over 1,000 visitors
International trade exhibitions
IBC: largest and most important event for professionals in digital media, television and radio
ISE for the professional audiovisual market: 44,000 visitors
The European Cancer Conference 2013 is a multidisciplinary conference that is known to be the leading oncology conference in Europe. The conference was opened by His Royal Highness King Willem-Alexander; the first time the King opened a conference since his coronation. With around 18,500 visitors, including 15,500 conference participants, the event was a great success. Nearly half of the participants used a specially developed Mobile App, which added value to their conference visit. ISTH Conference is the conference of the International Society on Thrombosis and Haemostatis. Over 20,000 specialists in the field of clotting issues from around the world visited Amsterdam RAI Convention Centre in June. The conference saw an interesting new type of communication in cooperation with ACS Audiovisual Solutions: the normal authentic ‘posters’ were replaced by e-posters on 74 large LCD screens on which the participants presented their research. According to the organisers, the digital and sustainable solution had never been used on this scale in the conference world. A huge information technology conference took place in November. The SAP TechEd conference is the leading conference on technical education for IT architects, managers and developers. It offered over 800 hours of training related to the SAP technology in hands-on workshops, lectures with demonstrations and Q&A sessions. Amsterdam RAI employees are proud that this large-scale event with its many technological aspects could be successfully organised in a short term and that SAP chose Amsterdam over Berlin. National conferences organised by third parties In 2013 the largest national conferences were those from the Dutch Orthopaedic Association and the NBA Accountants Day 2013, with 1,200 and 1,300 visitors respectively. International trade exhibitions organised by third parties Below is an overview of the main returning international trade exhibitions organised by third parties with regard to turnover, along with the number of exhibitors and visitors. It is similar to those in 2012. The International Broadcasting Convention (IBC) is still the largest and most important annual event for professionals in electronic media, television and radio. Every year it shows the latest equipment from around the world. This year, the event attracted nearly 53,000 visitors and 1,440 exhibitors from 170 countries to Amsterdam RAI Convention Centre. Due to the back-to-back programming with the international cardiology conference ESC, the transformation to IBC was realised in a record time (also see page 37). In 2013 ISE, Integrated Systems Europe, the international trade event for the professional audiovisual market attracted over 44,000 visitors and 894 exhibitors who displaying their latest products over some 33,000 m2. The 2014 edition has also taken place, breaking all records with 952 exhibitors and over 50,000 visitors.
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Events
PROVADA for professionals in real estate
World of Private Label International Tradeshow
Fashion trade exhibitions: Modefabriek and Kleine Fabriek
National consumer exhibitions
Jumping Amsterdam: annual equestrian event
Valhalla Festival
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PROVADA is the annual meeting point for the real estate sector. The three-day event brings together developers, investors, consultants, retailers, financers, housing corporations, end users and municipalities in a professional setting to share plans, visions and ideas. This year, during the ninth edition, the event welcomed 21,200 visitors and 250 standholders. Every year, the PLMA (Private Label Manufacturers Association) organises the World of Private Label International Tradeshow in Amsterdam RAI Convention Centre. It is the leading international trade exhibition for manufacturers and retailers of private label products. National trade exhibitions organised by third parties Of the national trade exhibitions, there is one event that stands out with regard to exhibitors and visitors. It involves two fashion exhibitions (Modefabriek and Kleine Fabriek) which each provide a half-yearly professional platform where hundreds of brands and labels present their latest collections to the retail sector, media, stylists and other fashion professionals. Modefabriek and Kleine Fabriek (the latter of which focuses on children’s fashion) are only accessible to registered exhibition visitors with a Chamber of Commerce registration and to accredited press. Visitors include retailers, wholesalers, suppliers, brands, labels and agencies. National consumer exhibitions organised by third parties The largest national consumer exhibitions organised by third parties are the Woonbeurs with 67,000 visitors, and PAN Amsterdam with over 46,000 visitors. Other events organised by third parties Jumping Amsterdam: the dressage and jumping event in Amsterdam RAI is an annual highlight on the Dutch equestrian calendar and attracts the world’s best riders, including Olympic champions. In early 2013 the 53rd edition of the event attracted approximately 51,000 equestrian fans. Jumping Amsterdam features show jumping, dressage and drive competitions, shows, evening entertainment, an exhibition space and various bars and restaurants. Every year Amsterdam RAI Convention Centre hosts various large dance events. In December we said goodbye to the Thunderdome event after 20 years. It was replaced by a new event called Valhalla. The second edition of the event in late 2013 was even grander than the previous one and featured acrobatics, clowns, illusionists, motorcycles, magicians and freak shows. On the night of 21 December the Valhalla Festival was Amsterdam’s largest circus with halls that featured a variety of electronic music and circus acts. The grand opening by the world’s fastest magician, Hans Klok was witnessed by some 19,000 visitors.
EXECUTIVE BOARD REPORT
Other activities: RAI Theatre
New one-off events in 2014
The Auditorium, the large hall in the RAI Conference Centre, can easily be converted into RAI Theatre, an attractive theatre venue with 1,750 seats and the latest audiovisual technology. In 2013 the theatre accommodated a total of 85 shows which attracted nearly 80,000 visitors. From November 2012 it featured ‘Shrek the Musical’. This was the first time a musical played exclusively in the RAI Theatre for such an extended period. Due to its success, the Albert Verlinde Entertainment production was extended in late 2012 to March 2013. In total the show was performed 60 times in RAI Theatre. New events to be organised by third parties in 2014 The 2014 portfolio also includes a variety of one-off events: Organisation
Event
Sector
EAGE Conference & Exhibition
conference / exhibition
Energy (geologists / engineers)
Int. Conference European Academy of Dermatology and Venereology EADV
conference / exhibition
Medical (dermatology / venereology)
SPE Annual Technical Conference & Exhibition
conference / exhibition
Energy (oil engineers)
exhibition
Attraction industry
Euro Attraction Show EuroPrevent
Medical (cardiologists)
Helitech International
exhibition
Helicopter industry
Health Ingredients
exhibition
Health & wellness
European Photovoltaic Solar
conference / exhibition
Energy
Energy Conference and Exhibition
conference / exhibition
Energy
conference
Technology
exhibition
Mobile work platforms
conference
Medical
exhibition
Medical (orthopaedists)
conference / exhibition
Food industry
exhibition
Publishing / media
IEEE 2014 Sections Congress Apex 2014 + International Rental Exhibition ISPOR Annual European Congress ESSKA – Sports Trauma World Cacao Exhibition World Publishing expo
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Facilities Amsterdam RAI’s strategy is aimed at utilising its 23-hectare premises flexibly and intensively, in order to create as many square metres of lettable space as possible. Various departments are responsible for our specialised, high-value facilities. Real estate projects The ‘RAI (Spatial) Future Vision’ report stipulates that Amsterdam RAI may expand at its present location to include the following high-value additions: the RAI Amtrium (scheduled for completion in May 2015), an extra parking garage (for 1,000 cars, at the preparation stage) and the RAI Hotel (also in preparation). Amsterdam RAI’s future vision focuses on sustainable development, the strengthening of its relationship with the Zuidas district, the reinforcement of Amsterdam RAI’s (international) position and the intensification of the RAI complex, both in physical terms and in usage. A commitment has been made to further improve the quality of connections with the surrounding district, in harmony with the local neighbourhood. These real estate projects are described in greater detail below.
Amtrium: new multifunctional building complex
Dynamic combined lettable space Sustainable technologies applied
BREEAM-NL (Excellent)
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ANNUAL REPORT 2013
The Amtrium Amsterdam RAI is independently developing a high-value, innovative, sustainable and multifunctional new building on the corner of Scheldeplein and Wielingenstraat. The new building has been given the name ‘Amtrium’. Benthem Crouwel Architects are responsible for the design. The Amtrium will be a ‘third-generation exhibition venue’ with multifunctional exhibition, conference and office functions. It will give the Amsterdam RAI Convention Centre a modern face seen from the perspective of Amsterdam city centre. In practical terms the Amtrium is a fully functional conference centre with a 676 m2 reception, conference halls (including a 520 m2 hall, which can be split into two equalsized halls) and breakout rooms. The top floors will be used to house flexible office space. The new building will also provide a fully-fledged entrance to the exhibition halls at the rear (4 and 5). The inclusion of a company restaurant (which can also serve a commercial function during complex-filling events) and a quality restaurant completes the concept. The Amtrium’s format makes it possible to intensify the concept of dynamic combined lettable space. The most sustainable technologies have been applied during the development of the Amtrium. Sunshades will be attached to the building’s exterior using ‘ribs’, thermal energy storage will be utilised and solar panels will be fitted on the roof. Apart from the atrium, the most eye-catching element of the Amtrium will be its vertical greenhouse for city farming. This will eventually enable the building to supply its own vegetables and herbs to the restaurants. The building will become the first conference centre in the Netherlands to fully comply with the most stringent sustainability standards: the 4-star BREEAM-NL New Building Design Certificate (Excellent). This is the highest possible standard of sustainability recognised by the Dutch Green Building Council.
EXECUTIVE BOARD REPORT
Amtrium, city farming
Amtrium steering group
Necessary expansion of parking facilities
Aboveground parking garage between the Holland complex and Park Hall
P+R facilities
Amtrium, the atrium
The project is under the supervision of a steering group, which is charged with the total overall control of the decision-making process in relation to the development of the new building. The Amtrium steering group met 13 times during 2013. On 28 February 2013 the Supervisory Committee granted permission for work on the building to commence. On 1 October 2013 work began with the demolition of the existing buildings. An Amtrium task force has been monitoring event planning during the work preparation and realisation phase, and aligning this with the implementation schedule. The Amtrium is expected to be brought into use on 1 May 2015. Parking garage Due to developments within the Zuidas district of Amsterdam, the parking places available in and around the Amsterdam RAI Convention Centre have been reduced in capacity from 8,000 to 3,000. In order to adequately fulfil its function as an international convention centre, Amsterdam RAI needs a capacity of 4,000 parking places on its own premises. The complex currently has a capacity of 2,700 built-in parking places and a further 300 at ground level. This makes it necessary to increase the number of parking places on Amsterdam RAI’s own terrain by 1,000. Concentrating parking facilities on its own premises not only strengthens Amsterdam RAI’s position but also reduces inconvenience to the surrounding area. Taking into consideration accessibility, traffic circulation, incorporation possibilities, spatial aspects and logistical requirements for the functioning of Amsterdam RAI Convention Centre, the most logical solution for increasing the number of parking places appears to be an aboveground parking garage, situated between the Holland complex and Park Hall. A garage of approximately eight levels seems feasible, for which access to the garage can be combined with that of the existing garage under the Holland complex and Hall 8. The addition of P+R facilities to the parking garage will contribute to the sustainability of the city of Amsterdam. This facility would not be available on or around days when events are organised at Amsterdam RAI.
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Facilities
Parking garage: parking by registration number speeds up the flow of visitors
Hotel between the RAI complex and Amsterdam RAI station
RAI Hotel For several years Amsterdam RAI has wished to build a four-star hotel on its own premises to accommodate conference participants and exhibition visitors. The original location suggested was to the rear of the RAI complex (by the marina next to the Boerenwetering waterway). The Future Vision report expresses a preference for a location on Europaboulevard, between the RAI Convention Centre and Amsterdam RAI train station. The marina location still has potential for a building with publicly accessible functions. A hotel at this location will make a fine addition to the core activities of Amsterdam RAI and reinforce our international market position. The location, directly alongside Amsterdam RAI train station with fast connections to Schiphol Airport, among others, is convenient for the high percentage of visitors who arrive by public transport. This hotel will serve a different market segment to that of the proposed hotel at Kop Zuidas. The RAI Hotel will have up to 800 rooms and a decision has been made to pass on the hotel project to an investor/developer at the preliminary design stage. Amsterdam RAI is currently discussing a joint approach for the tender process with the Municipality of Amsterdam.
€ 5.6 million in investments
Investments and projects in 2013 During the course of 2013 approximately € 5.6 million was invested in buildings, installations and premises. Investments in the RAI Convention Centre can be broken down into those relating to employment/safety (c. 10%), maintenance (c. 23%), renovations (c. 30%), cost savings / CSR (c. 17%) and quality improvements (c. 20%). Together, the renovation projects constituted the largest investment. Some of these are clearly noticeable by visitors/users and contribute to the RAI Convention Centre’s overall sense of quality (such as the replacement of canopies and the renewal of floors). Some investments are invisible to the outside world (such as the replacement of main electricity distributors and the renovation of the main kitchen).
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Green investments
Amsterdam RAI already uses various forms of green energy, heat and cold storage and combined heat and power (cogeneration). Solar energy has recently been added to this list. The roof of the Convention Centre’s Hall 8 has been fitted with 1,632 solar panels, which have a total capacity of around 360,000 kWh per year. In addition to Amsterdam RAI, Rabobank Amsterdam, Deutsche Bank, Triodos Bank and the Amsterdam Investment Fund provided part of the financing for this project. A further 173 panels with a capacity of 43,000 kWh per year will be fitted to the roof of the new Amtrium building, reducing CO2 emissions by between 16 to 24 tonnes per year. An important ‘green’ investment of more than € 0.5 million took place in 2012, when the lighting in halls, corridors, offices and outside areas was replaced with more energyefficient variants, supplied by Greenfox. During this financial year the remaining light fitting replacements were carried out, namely in the parking garages and the Auditorium (at a cost of € 200,000).
High-value ICT
Managing ICT expectations
Success in 2013
Information and Communication Technology High-value ICT facilities are an increasingly important factor in the success of an event and adequate business operations. The rapid growth of virtual applications on and around the exhibition floor and the need for exhibitors, visitors and RAI staff to be connected 24/7 requires continuous attention. Amsterdam RAI therefore prioritises the renewal and further development of its ICT services and service provision. Despite the growing portfolio of high-value ICT facilities it is still sometimes necessary to manage the ICT expectations of clients. During highly ICT-sensitive events intensive discussions take place in advance with the most important ICT users (organisers and exhibitors). If the wishes of the client go beyond proven technology, Amsterdam RAI seeks a formal acceptance of the risks by the client and enters into clear agreements concerning possible glitches in service. The proof of the pudding came in 2013 when the professionalisation implemented in the previous year was put into practice and large groups of visitors were able to use WiFi simultaneously. During certain events more than 10,000 users were connected to the WiFi network at the same time. The SAP TechEd event was another success. Not only due to the relatively short time available to organise the event but also due to the connection Amsterdam RAI’s ICT professionals were able to make between the Convention Centre’s ICT infrastructure and the SAP infrastructure in Germany. Clear steps were also taken in 2013 to make greater use of the knowledge available among suppliers such as Cisco, Microsoft and Xirrus. Alliances were also formed with TNO, universities and telecommunication companies in order to implement innovative technologies.
Problems with in-house operational ICT systems
In mid-2013 it became apparent that the redundancy and mirror systems for the in-house operational ICT systems (administration, operations) were not configured as they should be, threatening system availability. This threat has now been eliminated and suitable provisions put in place to improve systems redundancy.
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Exhibitor Services Amsterdam RAI’s Exhibitor Services support exhibitors in their preparations to make their participation in an exhibition a success. Organisers and exhibitors can order products and services for their stands via a special, state-of-the-art webshop, such as uniform (ready-to-exhibit) stands, hostess services, furnishings, catering, flowers & plants, telecommunication & ICT facilities, parking tickets, electricity, gas, water, and stand cleaning services. This has substantially increased turnover and enhanced client satisfaction in 2012 and 2013.
Catering: self-catered or in partnership with specialist third parties Restaurants
Hospitality plan
184,019 overnight stays booked in 2013
Catering Catering is an important pillar of Amsterdam RAI’s operations. In this field we either work independently or in partnership with specialist third parties. In all cases Amsterdam RAI takes responsibility for quality control. Four permanent restaurants are located within Amsterdam RAI: the Grand Café, First Floor restaurant, Holland Restaurant and Café Amsterdam. These restaurants are opened when called for by an event or conference. In addition, each hall offers various catering outlets during exhibitions and conferences. Among others, they include La Place, Wagamamma and Sjaak Swart. An organisation-wide hospitality programme commenced in 2013 to improve the hospitality experience within Amsterdam RAI. The second phase of the programme will be implemented in 2014. RAI Hotel & Travel Service The ability to attract large international events to Amsterdam is strongly dependent on the availability of sufficient hotel rooms at attractive prices set long in advance. The increase in the number of rooms available in recent years, to 33,000, along with good cooperation with hotels and Amsterdam Schiphol Airport, places Amsterdam RAI in a much better position to meet this requirement from international organisers. RAI Hotel & Travel Service (RHTS) is the largest accommodation intermediary service in Amsterdam and the surrounding region, and takes care of hotel reservations as well as additional services, such as car rental, transfers, excursions and booking flights to and from Amsterdam for visitors of (mostly international) events. The number of overnight stays booked by RHTS rose considerably last year. RHTS made 48,913 reservations in 2013, representing 184,019 overnight stays.
Reporting tool
I amsterdam approved
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RHTS is also able to differentiate itself in terms of quality. By offering a 24/7 online reporting tool, clients can check the latest status concerning hotel pick-up and hotel reservations for their event at any time. RHTS provides the same transparency with its internet script service, through which clients can display the current availability and prices of hotel rooms on their own websites. This has led to an increase in the number of bookings for organisations such as IBC, ISE and METS. Since April 2013 Amsterdam Marketing has awarded a quality certificate (‘I amsterdam approved’) to Amsterdam business hotels that agree to reserve a minimum of 65% of available rooms at a set price for large events at the RAI Convention Centre. These rooms can be booked via RAI Hotel & Travel Service.
EXECUTIVE BOARD REPORT
Company and personnel The success of Amsterdam RAI is largely determined by the expertise, creativity and commitment of its employees, with the crucial factor being the way in which hosting services are deployed and exhibition concepts are creatively developed. This section illuminates a number of developments regarding organisation and staff which have been relevant during the report year.
Satisfaction survey on activities and working conditions
Results available in early 2013
Response rate 73%
Satisfaction highly improved
Overall satisfaction: 7.7
Highest satisfaction with colleagues Points of improvement
Employee satisfaction In November 2012, a survey was held among all employees to gain feedback on satisfaction levels with the activities and working conditions at Amsterdam RAI. Amsterdam RAI also wished to identify key areas for improvement and gain insight into the effects of the personnel policy. The respondents were asked to indicate their satisfaction regarding eight main issues on a ten-point scale. The results were available and communicated to the employees in early 2013. 308 employees were willing to give their opinion. The response rate was 73% - higher than the national average of 65%. The general conclusion of the study is that satisfaction has improved greatly: for seven of the eight different items, employees were happier – sometimes considerably so – than during the previous survey in 2010. It was only with regard to ‘development opportunities at Amsterdam RAI’ that employee satisfaction seemed to have stagnated. Overall satisfaction was 7.7, a half point higher than during the last survey in 2010. Moreover, this score is 0.2 points higher than the national average. Working conditions (+0.8 points) and work activities (+0.6 points) are examples of items with which Amsterdam RAI employees were more satisfied than during the previous survey. The employees showed the highest satisfaction about their colleagues (score: 7.9); they were least satisfied with their wages (score: 5.3). Efficiency, workload – particularly the major differences between the departments – and salary and development possibilities remain issues to keep in mind. The results of this survey were reported and discussed by management and in the Works Council. Subsequently, the results (on the level of division/department) were presented by the director/manager to all employees. They were then translated into a plan of action to make improvements in the different fields.
Aim of the new work methods
New work methods Amsterdam RAI has chosen to introduce its own version of the so-called ‘new way of working’ throughout the company. This approach aims to create value through cooperation and management, enabling: 1. Amsterdam RAI’s strategy and derived objectives to be realised in a better way; 2. The productivity of RAI employees to be strengthened and their talent and potential to be better used; 3. Customer focus and customer satisfaction to be improved. The programme is based on three themes: Flexible Working, Learning Power, and Control & Space.
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Company and personnel Flexible Working
Flexible Working involves creating a work environment in which cooperation proceeds effectively in a flexible office and where agreements are made on how and where work and cooperation are most effective, independent of time and location.
Learning Power
The theme Learning Power focuses on smarter cooperation with colleagues (effective, efficient and inspiring) in a work environment where people learn from each other, while knowledge and experience are shared throughout the company.
Control & Space
The theme Control & Space aims to make it clear that results-oriented management should take place by means of controlling space and trust, so that employees can take responsibility for themselves. Cooperation should be based on an optimal response to customer needs and personal development.
Leadership development programme
Work styles determine the implementation of new working methods
Last year has been dominated by the last theme in particular. The top fifty key executives followed a leadership development programme which gave them improved insight into their management style and its effects, as well as into their profile and development orientation. The results were partly determined with the aid of a zero benchmark based on 360-degree feedback. This will be further developed over the coming year and a first benchmark will need to make the effects of the approach apparent. Next year will also mark the start of the leadership development programme for the next managerial level. From 2013, the new working methods will be incorporated for all managers in the HR Assessment and Development Cycle and the Business Balance Score Card. The construction and planned furnishing of the Amtrium was the catalyst for a companywide reflection on the distribution of office work stations against the background of flexible working. Six different working styles were identified within Amsterdam RAI. They provide structure and a basis for the choice of how to implement new work methods (ICT resources, facility design and behavioural counselling) to promote flexible working. For instance, under the new working methods, employees who spend practically the whole day sitting at the same desk – apart from occasional team consultations – need to see their work facilitated by a flexible workplace that can be used the whole day, with a formal space for team consultations. Where ICT resources are concerned, each person should have a desktop or laptop computer with access to the corporate network, access to RAI’s mobile internet and PGSM telephone. Diversity Amsterdam RAI is convinced that a higher diversity within teams has a positive impact on results. In addition to a focus on team composition within departments, diversity in steering and working groups is emphasised by the understanding that at least one woman and one person from Generation Y (born after 1980) should always participate. Generation management within Amsterdam RAI has three priorities. Firstly, Amsterdam RAI must be sufficiently prepared for new generations of workers. Secondly, people belonging to different generations must able to work together in harmony. And, thirdly, senior workers must be deployed in a more sustainable way in view of the aging of the population. With 47% men and 53% women, Amsterdam RAI has a gender-balanced workforce. The results in the area of diversity as endorsed in the charter Talent to the Top were high – the proportion of women in the second management echelon was 35%. Limited progress in the upper layers of management has meant that Amsterdam RAI did not fulfil its goals, however. This has been communicated to the charter organisation.
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A vital RAI
Frequent and constructive dialogue
Amsterdam University of Applied Sciences
Intermediate Vocational College Zuid
Safety & Security Board
Vitality Amsterdam RAI aims to help promote the vitality of its employees, so that everyone can be fit, energetic and vital at work. To achieve this, Amsterdam RAI has developed the programme ‘RAI Vitaal’, which serves to start, facilitate and promote vitality initiatives with employees. In 2013, a variety of tools, workshops and activities were offered to employees within the framework of RAI Vitaal to provide assistance in the area of health & fitness, promote job satisfaction, improve the balance between work and private life, and reduce stress and absenteeism. Cooperation with the RAI Works Council During the past year, there was again frequent and constructive dialogue between the Works Council and management. Subjects discussed included terms of employment, working conditions, the efficiency programme Excellent 2014, consultation and consent requests related to RAI Langfords and MECC Maastricht, the implementation of new working methods, and the retirement policy. The General Manager, supported by the head of HR, chaired the consultations as the only statutory Director. During the April and November meetings, two members of the Supervisory Board were also present as guests. In addition to these formal consultations, the dialogue continued in a number of subcommittees, such as the HR Committee, the Working Conditions Committee and the Terms of Employment Committee. The sounding board group set up by the Works Council for both permanent employees and temporary staff has given opinions on a wide range of topics. The annual Works Council report provides a more comprehensive description of the issues discussed in the past year. Cooperation with training institutes In October, Amsterdam RAI and the Amsterdam University of Applied Sciences signed an agreement to formalise the cooperation between the two organisations. This agreement formulates the intention to approach various activities jointly in a structural way, to learn from each other, and to encourage each person’s individual development. The Amsterdam University of Applied Sciences (domain of Economics and Management / HES) and Amsterdam RAI have been working together for several years to align degrees and working practice as closely as possible. For instance, Amsterdam RAI offers internships, participates in company fairs and opens its doors to student tours, while some of the managers give guest lectures at the university. The university, in turn, provides Amsterdam RAI with research students. Last year, a start was made on cooperation between the Intermediate Vocational College Zuid (part of the Regional Community College Amsterdam), which has been located near Amsterdam RAI since 2012. In the school year 2012/2013, 150 students following the degree ‘Organising and Event Support’ were taught a course called RAI hospitality. The course consists of training, a tour, student assessment and a practical training course of two days. In addition, students provide assistance during events at the Amsterdam RAI Convention Centre, for which they get study points. Safety Amsterdam RAI has a Safety & Security Board which monitors the company’s Health, Safety & Security policy. The policy aims to produce safety measures and facilities which support the continuity of business activities and represent the interests of Amsterdam RAI, staff, customers, suppliers and visitors in the broadest possible sense. The crisis management organisation was updated in 2013.
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Company and personnel Intensified cooperation with emergency services
Cooperation with the emergency services of the city of Amsterdam has been further strengthened. There is regular contact with the police and fire brigade. Contacts with the municipality have also intensified. Personnel figures Below are some cross sections of our personnel related to its composition.
Personnel figures
Personnel, age composition
(at the end of the year) 49,7%
50,3%
Percentage / FTP (at the end of the year)
2013
2012
Male
197
205
25 and under
Female
224
219
Total
421
424
2013
2012
2.9
3.1
26 to 35
30.9
31.8
36 to 45
31.7
31.6
46 to 55
22.1
21.0
Employees
FTE Male
193.8
201.5
Female
191.7
187.2
Total
385.5
388.6
56+
12.4
12.5
Total
100.0
100.0
Personnel, by gender
Absence through illness
Percentage / number of employees (at the end of the year)
Percentage
2013
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2012
3.63
3.43
2012 Total
Male
50.3
51.8
Female
49.7
48.2
100.0
100.0
Total
2013
AMSTERDAM RAI AND THE NEW WAY OF WORKING Six different working styles have been identified which contribute to flexible work within Amsterdam RAI. This enables every member of staff to customise their activities while also making the most of the available workspace.
EXECUTIVE BOARD REPORT
Shareholder equity and loan capital There were two major events in 2013 related to the shareholder equity and loan capital of Amsterdam RAI: a review of the dividend policy for the years 2013-2018 and a refinancing operation which will provide Amsterdam RAI with suitable financing for its activities until mid- 2020.
Shareholder performance
Social performance
Realising stakeholder goals Amsterdam RAI combines its financial and social ambitions and strives to unite the interests of stakeholders with the goal of the organisation itself: continuity in the long term. Within this framework, the starting point for the setup of the business model is as follows: 1. Creating shareholder value by maximising the sustainable financial results, combined with achieving the financial results in the short term in line with the annual budget, with an EBITDA greater than 15% and a minimum net result of € 3 million. 2. Creating the maximum economic spin-off for the city and region, from which Amsterdam RAI takes its ’license to operate’. This is realised as follows: if the (prognosticated) net annual result is below € 3 million, realising shareholder value has prevalence. In other cases achieving a proper balance between both starting points is the priority.
Fixed, to be indexed amount of € 2.24 million
Maximising, carry-forward
If results deviate substantially from basic scenario: deliberation
Dividend policy 2013 - 2018 In the year of review we discussed a new dividend policy for the coming years. Although this will not be decided upon until the General Meeting of Shareholders on 17 April 2014, the agreements will also be applied to 2013. Every year RAI Holding B.V. will pay its shareholders a total fixed dividend of € 2,240,000. The amount of € 2,240,000 applies to the dividend over 2013. Starting in 2014 the payable dividend based on the dividend of the previous year, will be indexed annually based on the CBS Index. The amount in dividend paid will never be higher than the amount of the net results over the relevant year. If, in any year, the dividend cannot be paid partly or entirely in accordance with the abovementioned policy because the net results are insufficient, the unpaid amount in dividend will be paid in the following year if the net results of the following year allow it. The cumulative payable dividend over previous bookyears will never be higher than the (indexed) fixed dividend over the previous bookyear over which the dividend should have been paid. If the net result is structurally and significantly higher than the growth scenario or significantly lower than the basic scenario, as indicated in the policy outline memorandum 2013-2018, the Board will meet with the shareholders to discuss whether the dividend policy should be reviewed.
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Shareholder equity and loan capital Compulsory dividend review may lead to reduction of dividend payment
Club deal Deutsche Bank and Rabobank
Equal club deal, ratio arranged via intercreditor agreement
2 facilities: long-term loan and current account credit
Before any decisions are made in any year regarding dividend payments, a dividend payment review will be performed by the Executive and Supervisory Boards of RAI Holding B.V. in accordance with the Flexibility and Security legislation. If the review reaches a negative result, there will be no dividend payment or only part thereof in the relevant year, after which the carry-forward will apply. Refinancing in year of review In 2004 Amsterdam RAI concluded a financing agreement with ABN AMRO (later: Deutsche Bank) on the one hand to repay loans from the City of Amsterdam, and on the other to meet the financing demands of Amsterdam RAI. In 2012 it started renegotiating with the banks, partly related to the termination of the current financing as of 1 January 2016. After research and meetings with stakeholders it was decided to enter into a club deal financing with the Deutsche Bank and Rabobank Amsterdam. Financing scheme The banks equally participate in the new financing scheme; the new bank financing is based on two identical credit agreements with the individual banks with the exact same rates, covenants, and standard conditions. The ratio between the two banks has been arranged via an intercreditor agreement. A long-term loan agreement for € 28 million has been made with both banks as well as an agreement for a current account facility (€ 15 million each). The overview below shows the characteristics of both facilities.
Facility A • Long-term loan, scope € 56 million • Term 7 years (end date 02 / 07 / 2020) • Repayment: -- 2013: none -- 2014 / 2015: € 2.0 million a year -- 2016 / 2017: none -- 2018 and later: € 4.0 million a year • Rate: 3M Euribor +1.80% surcharge
Interest swap: interest fixed at 3.34%
Facility B • Current account credit, scope € 30 million • Increase 2017 + € 2.5 million • Reduction 2018 - € 2.5 million • Rate 1M Euribor +1.45% surcharge • Facility Fee 0.3% a year
In late 2013 an interest swap agreement was concluded with the Rabobank and Deutsche Bank. This means that Amsterdam RAI is financed up to and including 2020 for a fixed interest rate of 3.34% (incl. a surcharge of 1.80%). Financial covenants The following table provides an overview of the financial covenants concluded with the banks.
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Financing scheme convenant
2013
2014
2015
2016
2017
2018
2019
2020
Senior Net Debt / EBITDA
<4.0
<4.0
<4.5
<4.5
<4.5
<4.0
<3.5
<3.0
Solvency
>30%
>30%
>30%
>30%
>30%
>30%
>30%
>30%
EBITDA *€ 1 m
>17.5
>17.5
>17.5
>17.5
>17.5
>17.5
>17.5
>17.5
* Reviewed annually. Reference date 31 December
Conditions The financing comes with conditions and securities, which are indicated below.
Conditions • No expansion of loan capital • Change of Ownership • Biennial retaxation RAI buildings • Max Capex 12 mln. a year • Max dividend up to net profit in bookyear • Max on intercompany loans on minority participations • Insight top 10 events / occupancy rate
Securities • Mortgage on existing and new real estate
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Order portfolio (at the end of 2013)* * Anticipated based on RAI events and reserved events / options made by third parties. Amsterdam RAIâ&#x20AC;&#x2122;s own forecast of all-in revenue based on events which are very likely to take place, as they are based on agreements, reservations and / or options.
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67%
2018
70%
2017
73%
2016
81%
2015
2014
97%
EXECUTIVE BOARD REPORT
Prospects Amsterdam RAI has several new international exhibitions in the pipeline for 2014. A range of events organised by third parties will also be hosted in Amsterdam. The forecast for the coming years is positive. Two internal priorities have been fixed for 2014: achieving better supply chain and department efficiency, and improving customer-oriented operational excellence.
Marketing In 2014, Amsterdam RAI will implement its multi-year marketing strategy and work to further improve its image. The course will be set according to the three priorities described in this annual report in the Strategy section. RAI events While prospects for exhibitions targeting the Dutch market (both professionals and the public) are squeezed by the economic downturn, the growth in international markets appears robust. Amsterdam RAI can benefit from this considering the solidity of its own international exhibitions. The growth of the spin-off exhibitions abroad will have a positive effect on the bottom line. In 2014, Amsterdam RAI will host 23 private events, of which 13 will take place in Amsterdam. The new international exhibitions in 2014 will be ICOMIA World Marina Conference Istanbul, Greentech, ISSA/INTERCLEAN Istanbul and BIG R/ ReMaTec USA. Third-party events New events organised by third parties in 2014 will be the ERA-EDTA Congress, EAGE Conference & Exhibition, Intl Con Eur Academy of Dermatology and Venereology EADV, SPE Annual Technical Conference & Exhibition, Euro Attraction Show, World Publishing Expo, Helitech International, and Health Ingredients.
Order portfolio The turnover based on incoming orders is an important indicator for the commercial performance of Amsterdam RAI. The indicator shows the degree to which the target turnover for the coming years, which is founded on the basic scenario, is prognosticated based on events with contracted options and reservations. The indicator is positive – with 97%, 2014 will be almost entirely covered. The percentage is as high as 78% for the next five-year period. Priorities Two priorities have been defined for 2014: achieving better supply chain and department efficiency and improving the customer-oriented operational excellence. Efficiency programme ‘Excellent 2014’ The efficiency programme ‘Excellent 2014’ will be rolled out throughout the company in 2014. This programme focuses on supply chain and department efficiency and customer-focused operational excellence. Customers must be dealt with in a more efficient and effective way within and between departments. A successful implementation of this programme will result in a more streamlined organisation and less stress for our employees. (continued on next page)
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Prospects Real estate developments Amsterdam RAI will complete the following quality additions in the coming years: • RAI Amtrium (opening in May 2015) • Additional parking garage (for 1,000 cars, in preparation) • RAI Hotel (in preparation) The improved accessibility provided by the new North/South line of the Amsterdam metro – and the attendant redesign of the public space after years of construction – as well as the addition of the new Amtrium complex in the part of the terrain closest to the city centre will soon mean that Amsterdam RAI Convention Centre is fully prepared for the coming decades. Employees The number of employees measured in FTEs will decline marginally compared to 2013 thanks to efficiency improvements. The number of FTEs in the organisation of RAI events will increase thanks to the introduction of GreenTech, the strengthening of the international sales and the addition of a new international controlling function. Results Our events calendar is busier in even years than in odd ones. This will also be the case in 2014. In other words, the outlook for the year in terms of turnover is good. The introduction of the efficiency programme means that cost development will get plenty of attention in 2014.
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Acknowledgements The board wishes to thank all stakeholders for their involvement with Amsterdam RAI. Special thanks go to the staff for their efforts. Our employees allowed Amsterdam RAI to achieve good results in 2013 even though AutoRAI was cancelled. Our people have ensured that Amsterdam RAI continued to positive results every year throughout the recession. This downturn is now behind us and the company can therefore look to the future with confidence. Amsterdam, 27 March 2014 Executive Board of RAI Holding B.V. A. J. (Hans) Bakker, General Director
#04
Governance and risk management
GOVERNANCE AND RISK MANAGEMENT
Corporate governance RAI Holding B.V. is a private limited company in accordance with Dutch law. The shares in the company are held by the RAI Association and the City of Amsterdam. The main activities of RAI Holding B.V. and its consolidated subsidiaries are owning and operating an exhibition and conference centre, owning (exhibition) titles, organising exhibitions and supplying products and services related to the aforementioned activities. The governance structure is based on Book 2 of the Dutch Civil Code, the statutes of RAI Holding B.V. and various internal regulations. The governance structure of RAI Holding B.V. includes a General Meeting, Supervisory Board, Executive Board and Works Council.
Published on the website
RAI Holding B.V. and its group companies
Code integrally recognised and applied where applicable
‘Explain’
Statutes The most recent statutes of RAI Holding B.V. are dated 18 July 2008 and published on the website of Amsterdam RAI (www.rai.nl). Legal structure RAI Holding B.V. is a holding company. Page 82 of the Financial Statement indicates which companies are part of RAI Holding B.V. Wherever this annual report states ‘Amsterdam RAI’ it refers to RAI Holding B.V. and all its group companies. Group companies are participations in which RAI Holding B.V. plays a policy-deciding role. Corporate Governance code The Executive Board and Supervisory Board recognise the Dutch Corporate Governance code as determined by the Corporate Governance Code Monitoring Committee in 2008 and apply the principles and ‘best practice’ definitions therein, insofar as they apply to RAI Holding B.V. In some cases the principles and ‘best practice’ definitions do not apply because RAI Holding B.V. is not quoted on the stock exchange and only has two shareholders. Nonetheless, the code is integrally recognised and applied where applicable. Any substantial change to the corporate governance structure of RAI Holding B.V. and compliance with the code will be presented to the General Meeting as a separate agenda item. The following recommendations from the code are not applied in full: • Remuneration Executive Board members upon dismissal The remuneration in the event of dismissal may not exceed one year’s salary. This agreement does not apply to Executive Board members who were already members of the Board when the Corporate Governance was implemented; • Authority of Supervisory Board to change variable remuneration and possible recovery The provision that the Supervisory Board should have the authority to change the variable pay of the Executive Board (either downward or up) and the authority to recover incorrectly transferred remunerations have not yet been included in the Supervisory Board regulations, but will be presented for approval this year; • Determination and publication of remuneration to Executive Board members on website The provisions related to the determination and publication of the remuneration of Executive Members have not been applied; based on Article 383 section 1 of Book 2 of the Dutch Civil Code, the therein included exemption has been applied as the Executive Board consists of one person;
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GOVERNANCE AND RISK MANAGEMENT
Corporate governance • Publication of notes on the general remuneration on website The provision that the written notes with a proposal for the approval or authorisation by the General Meeting is placed on the company’s website is not applied due to the fact that the company only has two shareholders; • Publication of policy for bilateral contacts with the shareholders on website The provision that the company formulate an outline policy regarding bilateral contacts with the shareholders and publish this policy on the website is not applied due to the fact that the company only has two shareholders.
Supervisory Board regulations details application of Dutch Corporate Governance Code
Supervising and assisting the Executive Board
Five members Profile and composition
Ensuring independent and critical functioning
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Governance Supervisory Board The Supervisory Board regulations were determined on 16 December 2011. They are based on Article 16, section 4 of the company statutes and serves as a supplement to the regulations and instructions that apply to the Supervisory Board in accordance with Dutch legislation and company statutes. The task division of the Supervisory Board and its working methods are included in the regulations. With these regulations the Supervisory Board aims to carry out the Dutch Corporate Governance code. The Supervisory Board regulations are published on the website of Amsterdam RAI (www.rai.nl). Supervisory Board tasks The task of the Supervisory Board is supervising the policy of the Executive Board and the general course of affairs within the company and the associated companies, and to assist the Executive Board with advice. In fulfilling its duties, the Supervisory Board is focused on the interests of the company and the associated companies, taking into account the relevant interests of all those involved in the company. The Supervisory Board is also responsible for the quality of its own activities. Scope and composition Amsterdam RAI has a Supervisory Board with five members. The profile characterisation is related to the composition of the Supervisory Board. It is discussed with the General Meeting and the Works Council whenever there are any changes. The profile characterisation is published on the website of Amsterdam RAI (www.rai.nl). The Supervisory Board is composed in such a way that its members can function independently and critically with regard to the other members, the Executive Board and any other partial interest, in accordance with the code. Each Supervisory Board member should be able to evaluate the outlines of the total policy. Additionally, each member has a specific expertise required for fulfilling his or her duty. The Supervisory Board aims to be composed in such a way that continuity is guaranteed, and should be well-balanced with regard to the age, experience and male / female ratio.
GOVERNANCE AND RISK MANAGEMENT
Reflection of interested parties
Three commissions
The aim is that three Supervisory Board members come from the business world, one from public administration and one from a sector network, preferably from majority shareholder the RAI Association. One Supervisory Board member is appointed on the recommendation of the Works Council. He or she speaks without burden or consultation. Commissions As the Supervisory Board has more than four members, there are three core committees (in accordance with the regulations), namely: an Audit Committee, Remuneration Committee and Selection and Appointment Committee. The committees are established and composed by the Supervisory Board. The (full) Supervisory Board remains responsible for all decisions, whether or not they were prepared by one of the committees. The regulations of the committees are published on the website of Amsterdam RAI (www.rai.nl).
Composition of commissions Supervisory Board, 2013
Name
Audit Remuneration Committee Committee
J.H.J. (Jan) Mengelers, Chairman J.W.Th. (John) van der Steen, Vice Chairman
member member
F.I.M. (Ferry) Houterman
Chairman as of 1 July
Professor A.J.M. (Annemieke) Roobeek S.J. (Shulamith) Rijxman J.R.(Hans) Vermeulen
Selection and Appointment Committee*
Chairman until 1 July member Chairman
* The task of the Selection and Appointment Committee was fulfilled by the Remuneration Committee. Due to the fact that no selections took place, there was no need to meet as Selection and Appointment Committee.
A maximum of three terms of four years
Step-down roster The step-down roster was determined based on Article 6, section 2 of the Supervisory Board regulations. A Supervisory Board member will step down at the latest on the first General Meeting held after four years since his or her last (re)appointment as Supervisory Board member. The roster is included below and continuously published on the Amsterdam RAI website (www.rai.nl).
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GOVERNANCE AND RISK MANAGEMENT
Corporate governance Step-down schedule Supervisory Board
Name
Date first appointment
Current term
Upcoming proposal for stepping Final date for stepping down: down or (re)appointment: the first General Meeting the first General Meeting after: after:
J.H.J. (Jan) Mengelers
08.04.2010
1st
08.04.2014
08.04.2022
F.I.M. (Ferry) Houterman
01.09.2004
01.09.2016
01.09.2016
J.W.Th. (John) van der Steen
07.04.2011
1st
07.04.2015
07.04.2023
J.R. (Hans) Vermeulen
19.12.2008 2nd
19.12.2016
19.12.2020
S.J. (Shulamith) Rijxman
12.04.2012
12.04.2016
12.04.2024
Introduction programme for new Supervisory Board members
Additional education
3rd (last)
1st
Training After appointment, every member of the Supervisory Board follows an introductory programme developed and financed by Amsterdam RAI which focuses on: general financial and legal affairs, financial reporting by the company, specific aspects of Amsterdam RAI and its business activities, and the responsibilities of the Supervisory Board. Once a year, the Supervisory Board also discusses possible desired / required (additional) education during the terms of the individual members. The meetings in the year of review have been included in the Statement from the Supervisory Board on page 18.
Transaction with conflicting interest; dealt with in accordance with regulations
No personal loans and / or securities provided to Supervisory Board members
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ANNUAL REPORT 2013
Conflicting interests Supervisory Board members do not take part in discussions and decision-making processes related to a subject or transaction in which the member has a conflicting interest with the company, as in Article 11 of the Supervisory Board regulations. If approved, such a transaction can only be concluded under the usual conditions and must be approved by the Supervisory Board and published in the annual reports. The Statement of the Supervisory Board indicated that there was one transaction involving conflicting interests in 2013. Remuneration The Supervisory Board members were not provided with shares and / or options or similar rights for obtaining shares in the capital of the company, nor did they acquire any loans and / or securities.
GOVERNANCE AND RISK MANAGEMENT
Fixed remunerations per function / committee memberships
The remuneration of the Supervisory Board members is determined in the General Meeting and does not depend on the results of Amsterdam RAI. The General Meeting decided to set the remuneration of the Supervisory Board members at € 21,647.77 and of the Chairman at € 27,059.71. The Chairman of the Audit Committee receives an additional remuneration of € 2,164.77. Report on activities Every year the Supervisory Board reports on its functioning in its Statement. See page 21.
Executive Board regulations details application of the Dutch Corporate Governance Code
Appointment for four-year terms
No securities / loans
No conflicting interests
Executive Board Governance The regulations for the Executive Board were determined on 16 December 2011, based on Article 13, section 3 of the company statutes and serves as a supplement to the regulations and instructions that apply to the Supervisory Board in accordance with Dutch legislation and company statutes. The task of the Executive Board and its working methods are included in the regulations with which the Executive Board aims to adhere to the Dutch Corporate Governance Code. The Executive Board regulations are published on the Amsterdam RAI website (www.rai.nl). Appointment Executive Board members are in principle appointed for a period of a maximum of four years. Reappointment occurs each term for a maximum period of four years. The appointment of periods of four years does not apply to Executive Board members who were already a member when the regulation was implemented. An extension of the statutory term until 1 March 2016 was agreed with the current statutory Director, after which he will step down on 1 August 2016 due to his retirement. RAI Holding B.V. and its subsidiaries did not supply any loans or securities to the Executive Board members. Conflicting interests Executive Board members do not take part in discussions and decision-making processes related to a subject or transaction in which the member has a conflicting interest with the company, as in Article 8.2 of the Executive Board regulations. If approved, such a transaction can only be concluded under the usual conditions and must be approved by the Supervisory Board and published in the annual reports. In 2013 there was one case of a transaction with possible conflicting interests. It involved the purchase of tickets from the GVB (the public transport company in Amsterdam), where Mr Bakker is Chairman of the Supervisory Board. In accordance with the procedure the transaction was submitted to the Supervisory Board.
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GOVERNANCE AND RISK MANAGEMENT
Corporate governance No shares, options, loans or securities provided
No report on the remuneration of the Executive Board
Applicable standards
Procedure for reporting suspected violations
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ANNUAL REPORT 2013
Remuneration The Executive Board member did not receive any shares and / or options or similar rights for obtaining shares in the capital of the company, nor did he acquire any loans and / or securities. The statutory Board of RAI Holding B.V. temporarily consists of only one person. Based on the exemption in Article 383, section 1 in Book 2 of the Dutch Civil Code the remuneration of the Executive Board is not reported. Employee governance Code of conduct Amsterdam RAI is aware of its social role and the resulting responsibilities towards all parties. The actions of Amsterdam RAI and its employees are founded on the core values and business principles as formulated by Amsterdam RAI. The code of conduct provides clarity by describing standards related to the actions of everyone who represents Amsterdam RAI. The instructions given by the code of conduct are unconditional and not influenced by financial goals. The code of conduct was implemented on 1 September 2006 and is published on the website of Amsterdam RAI (www.rai.nl). Whistleblower scheme The whistleblower scheme determines how employees can report suspected violations to their employer. The scheme details the procedure to be taken by the employer and determines that the employee who reports suspected violations and who acts in accordance with the provisions and in good faith will not be put at any disadvantage in his or her position as a result of his or her report. The whistleblower scheme was implemented on 1 September 2006 and is published on the website of Amsterdam RAI (www.rai.nl).
GOVERNANCE AND RISK MANAGEMENT
Risk management Amsterdam RAI has systems for risk analysis and control. The company distinguishes between strategic, operational and financial / administrative risks. Strategic risks are related directly to events that can structurally undermine the position of the company, operational risks are related directly to business activities, and financial / administrative risks are associated with developments in the financial market and financial & administrative management.
Strategic risks
Operational risks
Financial / administrative risks
Risks We recognise five strategic risks: S-1 The risk that one of the RAI’s own titles would have to be cancelled S-2 Risks surrounding letting to third parties S-3 Traffic: the reachability of Amsterdam RAI (city of Amsterdam, Schiphol) S-4 The risk that a third party event would be cancelled S-5 Securing against calamities We recognise 15 operational risks: O-1 Safety while working in the halls O-2 Construction risks: risks not covered by licenses that can result from placing temporary installations and structures O-3 Legionnaire’s disease O-4 Hazardous substances O-5 Hygiene and food O-6 Product liability related to RAI services O-7 Crowd control (i.e., in case of fire) O-8 National strike O-9 Failure of installations essential to an event (cooling, heating, power, etc.) O-10 Failure of in-house operational ICT-systems (administration, operations) O-11 Failure of event network O-12 Third party demands of the RAI’s ICT infrastructure and public services at the RAI may grow faster than the RAI is able to upgrade / expand O-13 Organisers, exhibitors and / or visitors using the (public) infrastructure differently than expected, resulting in substantial disruptions O-14 (Long-term) breakdown of ticket websites (huishoudbeurs.nl etc) O-15 Database integrity and privacy violations We recognise ten financial / administrative risks: F-1 Financing risks (including not being able to comply with bank agreements) F-2 Interest risk F-3 Currency risk F-4 Debtor risk F-5 Administrative organisation: integrity, availability, monitoring of automatic data processing and storage F-6 Financial control F-7 Potential write-off of capitalised costs of hotel development F-8 Cashflow risk F-9 Potential excessive reimbursement of expenses (fiscal) F-10 Accounting fraud
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GOVERNANCE AND RISK MANAGEMENT
Risk management Current risk and current consequences
Evaluation of risk impact
Risk evaluation method Evaluating the actual risks for Amsterdam RAI comprises both the current risk of occurrence of a possible event and the current consequences (measured in funds) of the event on Amsterdam RAI. The current risk and current consequences combination determines whether the current risk level is low n, medium n or high n. The evaluation explicitly takes into account the current monitoring procedures and measures / actions taken to mitigate the intended risk. The determination of risk and consequence is indicated in the matrix table below. The letters in the matrix indicate the type of risk, with S representing strategic risks, O operational risks, and F financial / administrative risks. The associated numbers refer to the risks as indicated above.
Risk matrix Risk (%) >90%: extreme 75-90%: high
O-14
50-75%: medium
O-6
25-50%: low
F-4
< 25%: very low
O-2 F-3 F-6
O-10
S-3 O-13
O-3 F-5 F-8
insignifcant < € 250.000
O-5
O-15
F-10
O-4
F-9
F-1
O-1
S-1
O-7 O-11
O-9 O-12
S-4
S-2 F-2
S-5
O-8
F-7 minor € 250.000 € 500.000
moderate € 500.000 € 1.000.000
major severe € 1.000.000 - > € 2.500.000 € 2.500.000 Consequences (€)
High risk related to events Operational risks are medium to low
Financial risks are generally low
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ANNUAL REPORT 2013
The matrix indicates: • Two of the strategic risks are indicated as high; both of them are related to events: either the cancellation of a RAI event, or the cancellation of a third party event; • Nine of the indicated operational risks represent a moderate risk, with the extremes (high risk, insignificant consequences) the risk of the long-term breakdown of ticket websites (risk O-14) and (risk very low, consequences severe) the risk of a national strike (risk O-8); • All financial risks except one (accounting fraud) are (very) low. • Eight of the ten financial / administrative risks are indicated as very low (<25%).
GOVERNANCE AND RISK MANAGEMENT
Discussed with the Supervisory Board The risks, internal risk management and control systems and the realised and planned actions were discussed in detail with the Supervisory Board. Internal risk management and control systems Below is an overview of which checks and actions were undertaken related to the three largest risks with regard to the impact on Amsterdam RAI. These three risks are all considered strategic risks. Limiting risks related to RAI events
The risks related to RAI events (risk: medium, consequences: severe) are related to the interests of exhibitors and visitors and influenced by economic conditions (an example in the negative sense is when the AutoRAI was entirely cancelled in 2013). This risks are limited by deploying dedicated, specialised teams for each of the RAI-organised events which have a great deal of knowledge and wide range of contacts in the relevant markets and trade associations which ensures they are fully informed on all event-related developments and able to stimulate the participation of major exhibitors. An important action to minimise these risks is the portfolio transition: being less dependent on one sector and expanding the portfolio internationally as well. Strengthening the brands by rolling them out internationally and offering relevant solutions is another way to mitigate these risks. Advanced database marketing further contributes to limiting the risk of disappointing visitor numbers.
Limiting risks related to third party events
Serious calamity
To prevent a large third party organised exhibition or conference from being cancelled (risk: low, consequences: severe) relation management of the A accounts has been placed at the Executive Board level. Long-term contracts are implemented where possible. To minimise the consequences of the cancellation of a large third-party title on the results of Amsterdam RAI a priority (time and funds-wise) is attracting alternative exhibitions and conferences for the future. For every large event we perform a risk analysis to determine the security level. Investments in hardware and organisation to protect against calamities have been finalised. Amsterdam RAI employs a Safety & Security Board that monitors and (where necessary) adjusts the measures related to protecting against calamities.
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#05
Financial Statements
2013
FINANCIAL STATEMENTS 2013
General
RAI Holding B.V. has its registered office in Amsterdam. The company’s financial year runs from 1 January to 31 December.
Activities
RAI Holding B.V. is a holding company. The main activities of the RAI are accommodating RAI-organised events, and providing facilities to third parties for exhibitions, conferences, corporate events, theatre productions and niche events.
Continuity
These consolidated financial statements have been prepared assuming that the company will continue as a going concern.
The company owns 100% of the shares in the following participations: Amsterdam RAI B.V., Amsterdam; EC Zuid Limburg B.V. (previously Maastrichts Expositie & Congres Centrum (MECC) B.V. (last year: 75%)), Maastricht; Arfora B.V., Amsterdam; RAI Langfords B.V., Amsterdam. The company had an interest of 75% in Maastrichts Expositie & Congres Centrum (MECC) B.V. On 4 July 2013 the remaining interest of 25% was taken over from the Municipality of Maastricht.
General principles for valuation
These group companies include the results of the following indirect participations (100%): AV RAI B.V., Amsterdam; Amsterdam RAI Catering B.V., Amsterdam; RAI USA, Inc., Delaware; Rui Ang Exhibition and Convention Co., Ltd., Shanghai. The companies in the USA and China were established in 2013.
Shareholder structure The RAI Association has a 75 percent interest in RAI Holding B.V. The remaining 25 percent of the shares are held by the Municipality of Amsterdam.
Terminated activities On 4 July 2013 the assets and liabilities of Maastrichts Expositie & Congres Centrum (MECC) B.V. were transferred to MECC Maastricht B.V. retroactively as of 1 January 2013. As a result, this company activity was terminated in 2013. With the sale, the RAI disposed of a total of € 6.1 million (including € 0.7 million in long-term debts) in assets and liabilities. Over the period 1 January 2013 to 4 July 2013 the turnover was € 6.6 million, while the costs were € 5.3 million, resulting in an operating profit before tax of € 1.3 million. Over 2013 the effect on the cash flow of the terminated activity for RAI Holding B.V. was nil. The actual transfer took place on 4 July 2013. The turnover and costs of Maastrichts Expositie & Congres Centrum (MECC) B.V. up to this date were included in the consolidated annual accounts of RAI Holding B.V. The results of the sale were entered under operating expenses.
The annual accounts were drawn up in accordance with the generally accepted principles for financial reporting in the Netherlands and meet the legal provisions regarding the annual accounts as recorded in Part 9, Book 2 of the Netherlands Civil Code. The principles for the valuation of assets and liabilities were applied consistently during the previous and current year. The principles for valuation and result determination apply to both the consolidated and company annual accounts.
Principles of consolidation
The financial data of RAI Holding B.V. and all its group companies are consolidated. Group companies are participations over which RAI Holding B.V. has decisive control. The other participating interests are not consolidated. The financial information of companies acquired during the year under review is consolidated from the moment that RAI Holding B.V. acquires decisive control over the decision-making of the companies concerned until the moment of termination of this control. Transactions between companies that are consolidated are eliminated.
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FINANCIAL STATEMENTS 2013
Comparative figures
The figures over the year 2012 were recategorised where necessary to enable a comparison with 2013.
Foreign currency
The functional currency is the euro. Assets and liabilities denominated in foreign currency are converted into euros at the exchange rate valid on the date of the balance sheet. Transactions in foreign currencies are converted at the exchange rates at the time of the transaction. The exchange difference that results from the denomination is included in the profit and loss account.
Use of estimates
In order to help determine the included figures when drawing up the annual accounts, the management of RAI Holding B.V. makes certain estimates and suppositions in accordance with the generally accepted principles of financial reporting. The factual results can deviate from these estimates. The estimates and underlying suppositions are regularly evaluated. Revisions of estimates are recorded in the period in which the estimate is revised and in future periods that are affected by the revision.
Financial instruments
Financial instruments include both primary financial instruments such as receivables or debts, and financial derivatives. For the principles of the primary financial instruments we refer to the description per balance sheet item. RAI Holding B.V. applies hedge-accounting based on documentation for each individual hedge relation, and documents how the hedge relations fit in with the goals of the risk management, hedge strategy and the expectations regarding effectiveness of the hedge.
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ANNUAL REPORT 2013
The effective part of the financial derivatives assigned to cost-price hedge-accounting is valuated at cost value and the ineffective part is valuated at real value. The valuation changes of the real value of the ineffective part are immediately processed in the profit and loss account.
Accounting principles for the valuation of assets and liabilities
Assets and liabilities are stated at their nominal value, unless otherwise indicated in the separate items in the explanatory notes. Intangible fixed assets Exhibition titles are valued at cost price or market value if lower. All externally obtained titles are depreciated over their economic life, which is assumed to be 20 years at most. Software is valued at historic cost and is depreciated over its economic life, which is assumed to be ten years at most. Operating rights are valued at acquisition price and depreciated annually based on the term of these rights. Tangible fixed assets These are valued at their acquisition price, minus straight-line depreciation based on the economic life. Work in progress is valued at acquisition price. Financial fixed assets Participating interests over whose business and financial policy significant control is exercised are stated at their net asset value determined on the basis of the accounting principles of RAI Holding B.V. Participating interests over which no significant control is exercised are stated at the acquisition price or current value if lower. Receivables from and loans to participating interests as well as other receivables are stated at the actual value in the first processing, and then valued at the amortised cost minus the necessary provisions.
FINANCIAL STATEMENTS 2013
Receivables Receivables are stated at the actual value in the first processing, and then valued at the amortised cost, which is the same as the nominal value minus, when necessary, provisions for doubtful debts. These provisions are determined based on an individual assessment of the receivables. The receivables have an expected term of up to one year, unless stated otherwise. Stock The stocks mainly involve food & beverage products of which the valuation is determined at acquisition costs, minus a provision for obsolescence, where necessary. Securities Securities are stated at their cost or market value on the balance sheet date, whichever is the lower. The market value is in principle equal to the value quoted on the stock exchange. If a sale is expected in the short term, the directly realisable value is considered the market value. Cash Unless otherwise noted, the liquid assets are available for disposal by the company or group. Minority interest The minority interest in group companies is stated at the net asset value determined in accordance with the accounting principles of these annual accounts.
Provisions Pension provision The company has arranged a pension plan for staff employed on 1 January 2013 which qualifies as a defined contribution scheme: The obligations of the company are limited to the payment of an annual contribution to the insurance company. The contributions to be paid in the future will depend in part on how the terms and conditions of employment change and on the returns achieved by the insurance
company on the invested contributions. The company does not have a provision for possible future increases in the contributions. Employees who were hired by the company as of 1 January 2013 or those who voluntarily switched to the new pension scheme are subject to a defined contribution pension scheme. Other provisions A provision for future reorganisation costs is made if there is a formalised and detailed reorganisation plan in existence on the balance sheet date, and implementation of the plan has been started or the outline of the plan has been communicated to the staff directly concerned no later than on the date the annual accounts were compiled. Where, under the terms of a tenancy, RAI Holding B.V. or its subsidiaries bear the costs of major maintenance of buildings let to them, a provision is made for the equalisation of the costs for the contractual term of the tenancy agreement. The level of the provision is based on a long-term plan for major maintenance and repairs. The maintenance costs of buildings owned by RAI Holding B.V. or its subsidiaries are either charged directly against the profits or capitalised and written off if the general capitalisation criteria permit this. A provision for long-service payments is included based on the valid long-service regulations per balance sheet date, taking into account the likelihood of staying, future labour cost developments and discount provisions. A provision is included for bonus schemes and participations based on relevant performance schemes. This provision is included under current liabilities. Related to the cancellation of the corporate activities of RAI Langfords B.V, a provision was included for the vacancy of let buildings at the end of 2012.
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FINANCIAL STATEMENTS 2013
Long-term liability Long-term liability includes debts with a remaining term of over one year. These debts are stated at the actual value in the first processing, and then valued at the amortised cost. Short-term liability Short-term liabilities have an expected term of less than one year. A provision is included for bonus schemes and participations based on relevant performance schemes. There is also a provision included for contractual agreements with employees. (Deferred) tax liabilities Temporary differences between the determination of profit for commercial and tax purposes are stated at their nominal value in the balance sheet as a deferred tax liability or asset. Deferred claims for corporation tax on account of tax-deductible losses are valued at the future tax rate known on the balance sheet date in so far as it can reasonably be expected that the claims are realisable. RAI Holding B.V. is the leading company of a group that is treated as a single entity for tax purposes. The other members of the group are: Amsterdam RAI B.V., AV RAI B.V., Amsterdam RAI Catering B.V., RAI Langfords B.V. and Arfora B.V.
Principles for result determination Revenue The financial statements have been prepared on the basis of the historical cost convention. Revenue and expenses are accounted for in the period in which the goods or services are supplied. For exhibitions and events this is the period in which the event takes place. For trade magazines this is the period in which they are published. Profits are accounted for in that period. Losses and risks that originated before the end of the
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ANNUAL REPORT 2013
financial year are processed if and insofar as they became known before the annual accounts were drawn up. Depreciation The depreciation on tangible fixed assets is calculated on a linear basis by reference to the expected economic life. The buildings are depreciated to residual value. The applied depreciation rates are between two and 20 percent. The depreciation of the intangible fixed assets is related to the acquisition value, and ranges between five and 20 percent. Financial income and expenditure The financial income and expenditure involve the interest income and expenditure attributable to the period concerned. Participating interest results The participating interest results concern the share of the company in the results of the net asset value of the participating interests. The share that the company is due is stated as the result of a specific participating interest in the participating interest results. Corporation tax The corporation tax is calculated on the commercial pre-tax profit, taking into account the tax facilities. The mutation in the provision for deferred corporation tax is taken into account in the calculations. Cash flow statement The cash flow statement has been drawn up in accordance with the indirect method. The resources in the cash flow overview consist of cash and bank credits. Receipts and expenditure on account of interest and corporation tax are included under the cash flow from operational activities. The cash flow that consists of the net result after tax, increased by the depreciation expenses, is recorded individually.
FINANCIAL STATEMENTS 2013
1.1. Consolidated balance sheet (before proposed appropriation of results) (Amounts x â&#x201A;Ź 1,000)
Assets
Ref.
2013
2012
Fixed assets Intangible fixed assets
1.1.1.
4,715
5,520
Tangible fixed assets
1.1.2.
152,940
162,582
Financial fixed assets
1.1.3.
1,134
1,247 158,789
169,349
Current assets Stock Receivables
1.1.4.
Securities
378
408
30,230
25,615
41
41
488
Cash
782 31,137
26,846
189,926
196,195
Liabilities Shareholder equity
1.1.5.
Subscribed capital
2,730
2,730
Share premium reserves
22,006
22,006
Other reserves
49,686
49,626
3,292
2,060
Unappropriated profits Minority interest
Provisions
77,714
76,422
0
0
77,714
76,422
1.1.6.
Tax deferral Other provisions
18
1,285
676
5,223 694
6,508
Debts Long-term liabilities
1.1.7.
61,859
48,045
Short-term liabilities
1.1.8.
49,659
65,220
189,926
196,195
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FINANCIAL STATEMENTS 2013
2.1. Consolidated profit and loss account (Amounts x â&#x201A;Ź 1,000)
Net turnover
Ref.
2013
2012
2.1.1.
116,625
134,669
Sum of operating revenues
116,625
134,669
Costs of outsourced work and other external costs
2.1.2.
45,966
57,257
Wages and salaries
2.1.3.
23,325
25,094
Social security contributions
3,377
3,735
Pension contributions
2,432
2,719
15,323
15,765
19,124
24,135
Amortisation on tangible and intangible fixed assets Other operating expenses (including other personnel costs)
2.1.4.
Sum of operating expenses Operating results Interest and similar costs
2.1.5.
Profit on ordinary activities before tax Taxes on profit on ordinary activities Share in profit of non-consolidated companies in which the RAI has a participating interest Results after tax Third party share in profit Net results after tax
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ANNUAL REPORT 2013
2.1.6.
109,547
128,705
7,078
5,964
-3,101
-3,403 -3,101
-3,403
3,977
2,561
-902
-488
0
22
3,075
2,095
217
-35
3,292
2,060
FINANCIAL STATEMENTS 2013
Consolidated cash flow statement (Amounts x â&#x201A;Ź 1,000)
2013
2012
Cash flow from operational activities Operating profit
5,964
7,078
Adaptations for: Depreciation on intangible and tangible fixed assets Result of participating interests and third party interests Changes in provisions
15,321
15,765
217
31
-5,814
1,683 9,724
Changes in stock and receivables
-4,585
Changes in short-term debts (excluding bank credit)
-9,721
17,479 5,069 -8,827
-14,306
-3,758
Cash flow from operational activities Paid interest
-2,440
Paid taxes on profit on ordinary activities
-1,135
Total cash flow from operational activities
-2,725 -1,544 -3,575
-4,269
-1,079
15,416
Cash flow from investment activities Transfer assets and liabilities MECC B.V. Net investment in tangible fixed assets Net investment in intangible fixed assets Net disinvestment in financial fixed assets
1,522
0
-5,612
-11,128
-783
-1,154
113
-22
Total cash flow from investment activities
-4,760
-12,304
Cash flow from financing activities Dividend payment
-2,000
-2,000
Changes in long-term liabilities
13,814
-8,953
Total cash flow from financing activities Changes in cash and bank credit Cash and bank credit as at 1 January Cash and bank credit as at 31 December
11,814
-10,953
5,975
-7,841
-11,648
-3,807
-5,673
-11,648
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FINANCIAL STATEMENTS 2013
Notes on the consolidated balance sheet as of 31 December 2013 (Amounts x € 1,000)
1.1.1. Intangible fixed assets
Exhibition titles
Software
Other
Total
Cost as at 1-1-2013
780
17,788
1,684
20,252
Investments
105
678
0
783
Disinvestments
-89
-10,361
0
-10,450
Cost as at 31-12-2013
796
8,105
1,684
10,585
Depreciation and amortisation as at 1-1-2013
389
13,377
966
14,732
Depreciation and amortisation 2013
112
1,424
53
1,589
Disinvestments
-90
-10,361
0
-10,451
Depreciation and amortisation as at 31-12-2013
411
4,440
1,019
5,870
Net book value as at 1-1-2013
391
4,411
718
5,520
Net book value as at 31-12-2013
385
3,665
665
4,715
Investments in exhibition titles are depreciated over a maximum period of 20 years. Software is depreciated over a period of ten years at most, calculated from the time it is first used. An impairment test on exhibition titles acquired externally in the past is performed each year. The ‘other’ category concerns above all the use of a lounge in the Amsterdam ArenA. These rights will be depreciated until the year 2026. Disinvestments are related to assets that are no longer used.
88
ANNUAL REPORT 2013
FINANCIAL STATEMENTS 2013
1.1.2. Tangible fixed assets
Cost as at 1-1-2013 Investments Finished work in progress Transfer assets / liabilities MECC B.V.
Buildings, installations and land
Inventory
Work in progress
Total
276,131
34,012
11,959
322,102
0
1,650
3,962
5,612
10,515
0
-10,515
0
0
-5,988
0
-5,988
-470
-1,491
0
-1,961
Cost as at 31-12-2013
286,176
28,183
5,406
319,765
Depreciation and amortisation as at 1-1-2013
138,141
21,379
0
159,520
10,229
3,504
0
13,733
Disinvestments
Depreciation 2013 Transfer assets / liabilities MECC B.V.
0
-4,467
0
-4,467
-471
-1,490
0
-1,961
Depreciation and amortisation as at 31-12-2013
147,899
18,926
0
166,825
Net book value as at 1-1-2013
137,990
12,633
11,959
162,582
Net book value as at 31-12-2013
138,277
9,257
5,406
152,940
Disinvestments
Buildings and land are depreciated over a period of 50 years, the Congress Centre over a period of 20 years, and installations over a period of 10 to 20 years. The other fixed assets are depreciated over a period of five to 20 years. The book value of land subject to a long lease (until 2028) as at 31 December 2013 is â&#x201A;Ź 4,082,592 (2012: â&#x201A;Ź 4,354,765). Disinvestments are related to fixed assets that are no longer used.
1.1.3. Financial fixed assets
Total
Balance as at 1-1-2013
1,247
Other mutations Dividend Balance as at 31-12-2013
-118 5 1,134
The financial fixed assets refer to a capital interest in Stadion Amsterdam CV of 1 / 9 share of the limited capital. The valuation of this capital interest is valued at the acquisition price or current value if lower.
AMSTERDAM RAI
89
FINANCIAL STATEMENTS 2013
Current assets
2013
2012
Trade receivables
21,256
18,590
Provision doubtful debts
-1,511
-1,427
1.1.4. Receivables
19,745
17,163
Other receivables
3,928
2,937
Accrued assets
6,557
5,515
30,230
25,615
1.1.5. Shareholder equity For notes on the mutations in the shareholder equity in 2012 and 2013 see the notes on the company annual accounts of RAI Holding B.V. (section 3.1.2). There were no direct changes in the shareholder equity during the financial year.
1.1.6. Provisions Balance as at 1-1-2013 Allocation Transfer assets / liabilities MECC B.V.
Maintenance
Tax deferral
Other
Total
2,380
1,285
2,843
6,508
0
0
152
152
-2,380
0
-37
-2,417
Withdrawal
0
-1,267
-2,282
-3,549
Balance as at 31-12-2013
0
18
676
694
The passive deferred tax consists of the differences between a commercial and tax-based valuation. The other provisions concern a provision for long-service payments and a provision for a reorganisation related to the conclusion of the activities of RAI Langfords B.V. The above provisions, with the exception of the reorganisation provision, are mainly of a long-term nature. Due to the sale of the activities of Maastrichts Expositie & Congres Centrum (MECC) B.V. the provision for large-scale maintenance was transferred to the new company MECC Maastricht B.V.
90
ANNUAL REPORT 2013
FINANCIAL STATEMENTS 2013
1.1.7. Long-term liabilities
2013
2012
Loan from Deutsche Bank Nederland N.V.
0
39,375
Loan from Deutsche Bank Nederland N.V.
27,000
0
Loan from Coöperatieve Rabobank Amsterdam U.A.
27,000
0
0
679
7,859
7,991
61,859
48,045
Principle
Payment in book year
Amount remaining
13,125
13,125
0
Loan from the Municipality of Maastricht Other liabilities
Overview of long-term loans as at 31 December 2013
Loan I Deutsche Bank Nederland N.V. Loan II Deutsche Bank Nederland N.V.
15,000
15,000
0
Loan III Deutsche Bank Nederland N.V.
20,000
20,000
0
Loan Deutsche Bank Nederland N.V.
28,000
0
28,000
Loan Coöperatieve Rabobank Amsterdam U.A.
28,000
0
28,000
Loan Municipality of Maastricht Other long-term loans
Minus short-term part of long-term liabilities
679
679
0
8,637
0
8,637
113,441
48,804
64,637 2,778 61,859
In 2013 the RAI entered into a credit agreement with Deutsche Bank Nederland N.V. and Coöperatieve Rabobank Amsterdam U.A. This credit agreement comprises an overdraft facility of € 30 million as well as two loans totalling € 56 million (50% Deutsche Bank Nederland N.V. and 50% Coöperatieve Rabobank Amsterdam U.A.) until 2020. Payments are made every three months, starting in the second quarter of 2014. The rate of interest on the loans is Euribor + 1.80%. In order to fix the interest rates, interest rate swaps amounting to € 55 million were concluded in 2005 and 2008 for the period 2006-2016. A part of the interest swap of € 10 million was sold in 2006. On this basis Amsterdam RAI B.V. pays an interest rate of 4.01 percent on an amount of € 13 million, 4.18% on € 15 million, and 4.95% on € 20 million. In 2013 € 21 million in interest swap contracts were concluded. On this basis RAI Holding B.V. pays an interest rate of 1.54% on an amount of € 21 million. The business premises at Europaplein have been mortgaged as security for the repayment of the long-term debts and overdraft facility. The other long-term debts consist of a lump-sum payment received in 1988 from the Municipality of Amsterdam for the operating losses of the Congress Centre in the period until 2038. This lump-sum payment was acquired in the past for an interest of 7.46%. This lump-sum payment is mainly of a long-term nature. The release benefits the operational costs. The annual interest increase is at the expense of the financial revenue and expenditure.
AMSTERDAM RAI
91
FINANCIAL STATEMENTS 2013
1.1.8. Short-term liabilities
2013
2012
Bank overdrafts
6,159
12,430
Short-term part of long-term liabilities
2,778
9,629
21,335
17,701
6,011
12,691
Advance payments Debts to suppliers Corporation tax Other taxes and social security contributions Accruals and deferred income
801
250
1,657
1,895
10,918
10,623
49,659
65,219
Off-balance sheet information
1. The total contractual commitments under tenancy agreements amounted to € 183,023 (2012: € 6,194,596) at the end of the financial year, of which € 144,699 relates to 2014, and € 41,304 to book year 2015. 2. Bank guarantees of € 100,553 (2012: € 100,553) have been issued in connection with tenancy agreements and securities. 3. There are operating lease commitments for 50 (2012: 60) cars. At the end of the financial year the contractual commitments totalled € 984,298 (2012: € 1,153,748), of which € 403,039 is due within one year. The remainder is due within five years. 4. Within the framework of the construction of the Amtrium there are liabilities at a total amount of € 13.947.949 of which an amount of € 11,747,949 is due within one year. The remainder is due in 2015. 5. The total liability for the long-term land lease (until 2028) amounts to € 6,531,993 of which € 435,466 is due within one year, and an amount of € 2,177,331 is due within five years. The remainder involves the period 2019 to 2028. 6. RAI Holding B.V. is the leading company of a group that is treated as a single entity for tax purposes. The other members of the group are: Amsterdam RAI B.V., AV RAI B.V., Amsterdam RAI Catering B.V., RAI Langfords B.V. and Arfora B.V.
Financial instruments
The risks associated with the financial instruments are clarified below. Credit risk In order to manage the credit risk, exposure is constantly monitored and acted upon. At the end of the financial year there was no major concentration of credit risks. Credit risks relate to debtors and other short-term receivables. Sufficient provisions were included accordingly. Currency risk There are no substantial currency risks as the operational cash flows and financing activities mainly take place in euros. Interest risk Interest risks mainly concern long-term loans. Amsterdam RAI B.V. has interest rate swap contracts to cover interest risks. In order to fix the interest rates, interest rate swaps amounting to € 56 million at the end of 2013 were concluded in 2005 and 2013 for the period 2006-2020. Amsterdam RAI B.V. pays an interest rate of 4.01% on an amount of € 13 million, 4.18% on € 15 million, and 4.95% on € 20 million to Deutsche Bank Nederland N.V. Amsterdam RAI B.V. pays an interest rate of 1.54% on a € 21 million loan from Deutsche Bank Nederland N.V. / Coöperatieve Rabobank Amsterdam U.A. A variable interest rate of three months Euribor plus an individual surcharge is paid on the bank overdrafts. The amounts covered by the interest swaps are smaller than or equal to the outstanding principle of the loans from Deutsche Bank Nederland N.V. On 31 December 2013 the interest swaps had a real value of minus € 2,202,786 (2012: minus € 3,920,677). The real value will be reduced to zero over the remaining interest swap period (until 2020).
92
ANNUAL REPORT 2013
FINANCIAL STATEMENTS 2013
Notes on the consolidated profit and loss account 2013 (Amounts x â&#x201A;Ź 1,000)
2.1.1. Turnover
2013
2012
110,527
130,679
6,098
3,990
116,625
134,669
By geographical area The Netherlands Other countries
By activity Exhibitions and events
39,330
52,530
Letting to third parties
23,617
23,200
0
3,153
Catering
Publication of trade journals
17,786
16,903
Parking
4,298
5,416
Hotel commissions
3,530
3,063
20,828
22,297
7,236
8,107
116,625
134,669
2013
2012
Exhibitions and events
22,395
22,966
Letting to third parties
1,407
932
Facility Services Other
2.1.2. Costs of outsourced work and other external costs
Publication of trade journals
0
2,351
Outsourcing costs
4,823
5,950
Catering
4,432
5,860
Personnel
6,365
8,371
Marketing costs
4,035
5,773
Other
2,509
5,054
45,966
57,257
AMSTERDAM RAI
93
FINANCIAL STATEMENTS 2013
2.1.3. Personnel costs The Board of RAI Holding B.V. consists of one person. Based on Article 383 section 1 book 2 from the Netherlands Civil Code, the salary is therefore not included in this statement. The salary paid to Supervisory Directors (six on average) amounted to € 128,223 (in 2012: € 128,831, with an average of six). Average number of employees (FTEs) working for the group
2013
2012
390
479
2.1.4. Other operational costs
2013
2012
Building costs
9,171
11,470
Agency costs
827
1,065
Automation costs
3,276
3,256
Consultancy costs
2,061
2,940
In the Netherlands
Travel, accommodation and representation costs
583
1,167
Other personnel costs
1,269
2,500
Other general operational costs
1,937
-74
0
1,811
19,124
24,135
Costs for the termination of the activities of RAI Langfords B.V.
The result of the sale of the activities of Maastrichts Expositie & Congres Centrum (MECC) B.V. to the amount of € 1.3 million is included under other general operational costs. Auditors’ costs The 2013 profit and loss account shows an amount of € 76,285 (2012: € 74,625) for the costs of auditors BDO Audit & Assurance B.V. for the 2013 annual audit. 2.1.5. Interest expenses and similar costs
2013
2012
Interest expenses
3,101
3,403
2.1.6. Taxes Tax charged based on the commercial result
1,017
840
0
-287
Settled taxes and other securities
-115
-65
Tax charged in the profit and loss account
902
488
Changes tax deferral
The effective taxation rate is 24.7% (2012: 20.3%) and is in line with the average nominal corporation tax rate in the Netherlands.
94
ANNUAL REPORT 2013
FINANCIAL STATEMENTS 2013
Company balance sheet (before appropriation of results) (Amounts x € 1,000)
Assets
Ref.
2013
3.1.1.
94,386
2012
Fixed assets Financial fixed assets
91,311 94,386
91,311
Liabilities Shareholder equity
3.1.2.
Issued capital
2,730
2,730
Share premium
22,006
22,006
Other reserves
49,686
49,626
3,292
2,060
Unappropriated profit
Provisions
77,714
76,422
3.1.3.
7,620
8,507
3.1.4.
9,052
6,382
94,386
91,311
Debts Debts to group companies
Company profit and loss account (Amounts x € 1,000)
2013
2012
217
-222
Result from participating interest after taxes
3,075
2,282
Net result
3,292
2,060
Company result after taxes
The corporate profit and loss account has been drawn up in accordance with Article 402 of Book 2 of the Netherlands Civil Code. The financial data of RAI Holding B.V. is included in the consolidated annual account. As a result, the profit and loss account of RAI Holding B.V. only states the share in profits after taxation of participating interests and the other result after taxes, in accordance with Article 402 of Book 9 of the Netherlands Civil Code.
AMSTERDAM RAI
95
FINANCIAL STATEMENTS 2013
Notes on the company balance sheet as at 31 December 2013 (Amounts x € 1,000)
3.1.1. Financial fixed assets
Participation in group companies
Balance as at 1-1-2013
91,311 3,075
Result Paid share premium
665 -665
Provision Balance as at 31-12-2013
94,386
The company owns 100 percent (unless otherwise stated) of the shares in the following major participations: Amsterdam RAI B.V., Amsterdam; EC Zuid Limburg (previously Maastrichts Expositie & Congres Centrum (MECC) B.V., (last year: 75%)), Maastricht; Arfora B.V., Amsterdam; RAI Langfords B.V, Amsterdam. The results of these group companies include those of the following indirect participations (100%): AV RAI B.V., Amsterdam; Amsterdam RAI Catering B.V., Amsterdam; RAI USA, Inc., Delaware; Rui Ang Exhibition and Convention Co., Ltd., Shanghai. The companies in the USA and China were established in 2013. On 4 July 2013 the assets and liabilities of Maastrichts Expositie & Congres Centrum (MECC) B.V. were transferred to MECC Maastricht B.V. retroactively as of 1 January 2013.
3.1.2. Shareholder equity
Share capital
Share premium reserve
2,730
22,006
48,530
3,096
Appropriation of profit
0
0
3,096
-3,096
0
Result book year
0
0
0
2,060
2,060
Dividend
0
0
-2,000
0
-2,000
Balance as at 31-12-2012
2,730
22,006
49,626
2,060
76,422
Balance as at 1-1-2013
2,730
22,006
49,626
2,060
76,422
Balance as at 1-1-2012
Other Unappropriated reserves profit
Total
76,362
Appropriation of profit
0
0
2,060
-2,060
0
Result book year
0
0
0
3,292
3,292
Dividend
0
0
-2,000
0
-2,000
2,730
22,006
49,686
3,292
77,714
Balance as at 31-12-2013
The authorised capital is € 13,650,000, divided into 225,000 ordinary ‘A’ shares, and 75,000 ordinary ‘B’ shares, each having a nominal value of € 45.50. Of these, 45,000 ‘A’ shares and 15,000 ‘B’ shares have been issued and fully paid up.
96
ANNUAL REPORT 2013
FINANCIAL STATEMENTS 2013
3.1.3. Provisions
Provisions 8,507
Balance as at 1-1-2013 Allocation
0
Reversal
887 7,620
Balance as at 31-12-2013
The provision involves a provision for the negative shareholder capital of RAI Langfords B.V.
3.1.4. Debts to group companies
Debts to group companies
Balance as at 1-1-2013
6,382
Changes
2,670
Balance as at 31-12-2013
9,052
As was the case in 2012, no interest is charged on the debts to group companies.
Personnel
As was the case in 2012, RAI Holding B.V. did not employ any staff in 2013.
Off-balance sheet information
Letters of liability in accordance with Article 403 of Book 2 of the Netherlands Civil Code have been issued and deposited for the participating interests in Amsterdam RAI B.V., AV RAI B.V., Amsterdam RAI Catering B.V. and RAI Langfords B.V. Amsterdam, 27 March 2014 The Executive Board, A.J. Bakker The Supervisory Board, J.H.J. Mengelers (Chairman) F.I.M. Houterman S.J. Rijxman J.W.Th. van der Steen J.R. Vermeulen
AMSTERDAM RAI
97
FINANCIAL STATEMENTS 2013
Other information Proposal for the appropriation of profit
In accordance with article 24 of the company statutes, the following has been recorded regarding the appropriation of profit. Article 24. 1. In addition to several other reserves, the company can keep a general reserve, a share premium reserve A, a share premium reserve B, a dividend reserve A, and a dividend reserve B in its books. The respective rights to these reserves go to owners of shares A and shares B, pro rata to the number and type of shares they own. 2. Payments to shares A and shares B that exceed the nominal value of those shares are added to the share premium reserve concerned. 3. Without prejudice to that determined elsewhere in this article, the distributable profit is freely at the disposal of the General Meeting for the payment of dividend, reservations or other such purposes within the company’s goal as determined by the General Meeting. 4. The General Meeting can determine, with the prior approval of the owners of shares of the type concerned, to not pay profit on those shares but to reserve that part of the profit and add it to the dividend reserve A or B respectively. Payment against dividend reserve A or B respectively can only be made to the owners of the type of shares concerned if the General Meeting determines as such after prior approval by a meeting of those owners. 5. Without prejudice to that determined elsewhere in this article, if the General Meeting decides to reserve profit or pay dividend on all shares regardless of the type, equal amounts of the profit will be reserved or paid as dividend. 6. The company can only make payments to shareholders and other parties that have a right to the payable profits insofar as the shareholder capital is larger than the paid and requested part of the capital increased by the reserves that must be applied in accordance with the law or statutes. The shares kept in the capital of the company are not included in the calculation of the appropriation of profit. 7. Appropriation of profit will occur after the determination and approval of the annual accounts which show that payment is permissible. 8. The General Meeting is authorised to determine payments on one or multiple interim dividends, with due regard to point seven. 9. Unless the General Meeting determines another date, dividends are payable immediately after determination. 10. The right to claim for payment of dividend lapses after a period of five years. Management proposes the General Meeting of Shareholders pay a dividend of € 2.24 million over the year 2013. The result after tax over 2013 is included in the unappropriated profit item under shareholder equity.
Events after the balance sheet date None.
98
ANNUAL REPORT 2013
FINANCIAL STATEMENTS 2013
Independent auditor’s report
To: the General Meeting, Supervisory Board and Executive Board of RAI Holding B.V. Report on the Financial Statement We have audited the accompanying Financial Statement 2013 of RAI Holding B.V. in Amsterdam, which comprises the consolidated and company balance sheet as at 31 December 2013 and the consolidated and company profit and loss account for the year then ended and the notes, comprising a summary of the accounting policies used and other ex-planatory information. Management responsibility Management is responsible for the preparation and fair presentation of these financial statement and for the preparation of the management board report, both in accordance with Part 9 of Book 2 of the Dutch Civil Code. Furthermore management is responsible for such internal control as it determines is necessary to enable the preparation of the financial statement that are free from material misstatement, whether due to fraud or error. Auditor’s responsibility Our responsibility is to express an opinion on the financial statements based on our audit. We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. This requires that we comply with ethical re-quirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statement. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of mate-rial misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair pres-entation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
AMSTERDAM RAI
99
FINANCIAL STATEMENTS 2013
Other information Opinion with respect to the financial statements In our opinion, the financial statements give a true and fair view of the financial position of RAI Holding B.V. as at 31 December 2013 and of its result for the year then ended in accordance with Part 9 of Book 2 of the Dutch Civil Code. Report on other legal and regulatory requirements Pursuant to the legal requirement of Section 2:393 sub 5 e and f of the Dutch Civil Code, we have no deficiencies to report as a result of our examination into whether the management board report, to the extent we can assess, has been prepared in accordance with Part 9 of Book 2 of this Code, and whether the information as required under Section 2:392 sub 1 at b-h has been annexed. Further we report that the management board report, to extent we can assess, is con-sistent with the financial statements as required by Section 2:391 sub 4 of the Dutch Civil Code. Amstelveen, 27 March 2014 For and on behalf of BDO Audit & Assurance B.V.,
J.H. Luijt RA
100
ANNUAL REPORT 2013
Personal details Amsterdam RAI Management Executive Board A.J. Bakker, General Director Finances M. Roodenburg, Financial Director a.i. Amsterdam RAI Exhibitions I. Boersma, Director Exhibitions Th. Lingmont, Director International Exhibitions M.H.W. Visser, Director Marketing and National Exhibitions Amsterdam RAI Convention Centre J. van den Bosch, Director Production & Facilities M. van der Sluis, Director Commerce M.A. van Nierop, Director Operations Legal department S.J.J. Hanrath, Assistant-Director P.H. Bottema-Sanders (as of 1 February 2014)
Amsterdam RAI Works Council E. Kayser, Chairman G.C. van Bemmel, Interim Chairman J.C.A. Visser J.P. ten Kleij C.J.M. van Gastel N. Boerrigter-van der Meulen MBA H. de Vries R. Stokvis J.J. Bom R.J. van Schooten P. Lucassen H.A.M. Schouten, official clerk
AMSTERDAM RAI
101
Colophon Published by Amsterdam RAI, Corporate Communication Concept and Realisation Toebosch Consult in cooperation with De Man Beheer en Advies Design and layout dBOD Photography Delux OTTI Fotografie NFP Photography Van Yperen Fotografie Printed by SDA
Contact Amsterdam RAI welcomes your reactions on this report via corcom@rai.nl Copyright The information in this Annual Report may be copied stating the source as ‘Jaarverslag RAI Holding B.V. 2013’.
102
ANNUAL REPORT 2013
Amsterdam RAI Europaplein 1078 GZ Amsterdam The Netherlands P.O. Box 77777 1070 MS Amsterdam The Netherlands T: +31 20 549 12 12 F: +31 20 646 44 69 www.rai.nl