From record-breaking numbers to the crisis of the century
The year 2020 was completely unpredictable for us at Messukeskus and for the entire world. Our year began in a record-breaking atmosphere with more than 68,000 visitors and nearly 1,000 companies and organisations from 89 countries at the Matka Travel Fair. Back in January, no-one knew that in March both the event and the travel industry would soon walk into a wall.
Before the full stop in March, we had time to organise several successful events. The number of visitors also increased at the Boat Fair and the education fair Educa.
March 12 was an unprecedented day for us. In order to ensure the health safety of our clients, we had to close our doors in the middle of the Gastro Helsinki event.
We were facing the crisis of the century.
We did, however, not lay down and do nothing, but chose three paths from which we set out to build a bridge over the crisis. The first path was the virtual and hybrid events. Our digital strategy, which we have been implementing for several years, and our subsidiary SVV, specializing in audiovisual solutions, gave us an excellent basis to make a quick change. Already the same spring, the first virtual events were organised and the year culminated in the Helsinki Book Fair online. At the Book Fair, we offered programme on two live stages for four days.
On the second path, we looked at our facilities in a new light: in a changed situation, what alternative uses could we come up with together with our partners. Soon, our good location, efficient logistics and spacious premises served as a Corona testing location for both HUS Helsinki University Hospital and health care company Mehiläinen. In addition, entrance exams for Laurea University of Applied Sciences and court sessions were arranged safely in our facilities.
Our third path was working for better health safety at events. We examined things carefully and prepared ourselves thoroughly, co-operated smoothly with the authorities and discussed with health care professionals. The result was comprehensive measures and precise self-monitoring guidelines. Spacious and high premises designed for large numbers of people, as well as efficient ventilation without recirculated air, ensure safe distances and clean indoor air. Contactless solutions, such as faucets, enhanced cleaning and trained cleaning staff improve the hygiene level. Masks and other protective equipment will further improve health safety.
Despite our ability to change, the year has been very difficult. We have had to adjust our operations and lay off our staff. Still, the year ended heavily at a loss.
However, we believe that these and many other measures will take our company forward and will help us organise health safe events and succeed in the unpredictable and changing future. There is still a great need for events. This is reflected in our extensive client feedback and research.
Anni Vepsäläinen | Managing Director
Report of the Board of Directors 2020
The year 2020 at Messukeskus was a struggle with the challenges brought by the pandemic as well as persistent work for event safety and the rapid development of the hybrid business area.
With the exception of the first quarter of the year, the common denominator for everything that was done was the COVID-19 pandemic, which upset the possibilities of organising events globally.
Impact of the pandemic on Messukeskus’ business
Messukeskus’ year 2020 got off to a strong start. The largest visitor magnets Matka Travel Fair (68 302 visitors) and Vene Båt Boat Fair (70 875 visitors) at the beginning of the year both increased their number of visitors significantly, Matka Travel Fair by 11% and Vene Båt Boat Fair by almost 9%.
In February, news coverage of the global COVID-19 virus accelerated, and on 11 March, the World Health Organisation WHO declared the epidemic a pandemic. Messukeskus interrupted – for the first time in its history – its ongoing event on Thursday 12 March and rescheduled their major events scheduled for spring to be arranged at a later point. The decision was based on a government recommendation banning all public events for more than 500 persons until the end of May.
A strong change in the operating environment virtually halted the Trade Fair business for the rest of the year. Events were rescheduled to later dates. The Events, Meetings and Congresses business continued on a small scale, in accordance with the current official guidelines and meeting restrictions. The change in business also largely halted restaurant operations and weakened hotel occupancy. As trade fairs, congresses, large meetings and corporate parties and banquets, belonging to normal business operations, could not be organised, the total number of visitors was one-third of those earlier – 374,223 visitors (2019: 1,087,718 visitors). The rapid change in operating environment also required the largest adjustment measures in the history of Messukeskus. These measures resulted in total savings of EUR 23.5 million. The most significant savings were in event organisation costs and staff costs. Personnel costs were reduced through significant layoffs in the group as a whole and voluntary reductions in salaries and board fees.
Hybrid business and new openings
Messukeskus adjusted its operations by looking for savings, freezing investments and applying for State Treasury cost support, land rent exemption from the City of Helsinki as well as development funding from Business Finland. During 2020, a total of EUR 900,000 in subsidiaries and EUR 202,000 in rent exemptions were received.
In a challenging situation, the strategy was updated and the production of virtual and hybrid events began, as did the offering of streaming services and service packages suitable for virtual events to customers. A giant studio space was built in Hall 5, where the October Helsinki Book Fair and the November Studia Fair were successfully produced as virtual events. Virtual and hybrid events were also produced for clients, for instance The Finnish Union of Practical Nurses (Super) General Assembly and the eVeterinary Congress.
Extensive facilities and meticulous work for event safety also enabled physical events for clients, such as entrance exams for Laurea University of Applied Sciences and the use of meeting facilities in Messukeskus’ Siipi conference area as courtrooms for the National Courts Administration Finland. A drive-in Corona testing station for health care company Mehiläinen was opened in the parking area and one for HUS Helsinki University Hospital in the exhibition halls.
Development of event safety
From the beginning of the pandemic, Messukeskus strictly followed the instructions of the authorities and immediately began to develop its operations with the aim of safe event participation for clients and staff. The hygiene level of the premises was raised and face and drop shields, safety distance stickers and other hygiene items were reserved for clients to use. Staff safety instructions for the office facilities were renewed.
In June, Messukeskus was the first trade fair organiser in Finland to publish comprehensive Corona safety guidelines to support clients and staff. The guidelines were based on the recommendations of UFI, the international umbrella organisation for the exhibition industry, and the self-monitoring guidelines of the The Association of Trade Fair and Event Organisers in Finland. The guidelines carefully observed the Finnish Institute for Health and Welfare’s guidelines and the regulations of the Regional State Administrative Agency. In August, safety training was organised for the entire staff.
Internal and external communication related to Corona safety continued throughout the year through multi-channels, taking into account all clients and stakeholders.
Responsibility work placed a strong emphasis on developing safety of events and facilities.
Additionally, in May, Messukeskus was the first exhibition centre in the world to publish a corporate responsibility report according to the United Nations Agenda for Sustainable Development (Agenda 2030). The report lists item by item the long-term responsibility work carried out at Messukeskus, covering the environment, the economy and people.
A stronger commitment to responsibility was also made by joining Visit Finland’s Sustainable Travel Finland programme. As a result, Messukeskus was awarded the Sustainable Travel Finland label in October. Despite the pandemic, we are moving towards our carbon neutrality target of 110% in 2030.
The Finnish Fair Corporation is owned by its members. The corporation has 198 members, including enterprises, the City of Helsinki and the Finnish Fair Foundation.
Turnover and result
The Finnish Fair Corporation Group consists of the Finnish Fair Corporation and its wholly owned subsidiaries Expomark Oy, Helsingin Messut Oy and SVV – Sound, Vision and Videoprojection.
In 2020, the Finnish Fair Corporation Group had a turnover of EUR 20,2 million (in 2019 EUR 59.3 million), representing a year-on-year change of -66.0 %. Of the subsidiaries, Expomark Oy saw a decrease in turnover by 99,5 % while the turnover of SVV – Sound, Vision and Videoprojection decreased by 73,8 % compared to the previous year.
Operating expenses came to EUR 34,6 million (56,7), of which planned depreciation accounted for EUR 10,6 million (10,4).
The Finnish Fair Corporation Group’s operating result decreased compared to that of the previous year and was EUR -13,5 (2,6) million. The net profitability was -67,0 % (4,4).
The profit before appropriations and taxes came to EUR -13,4 million (2,3).
Cash flow from operations totalled EUR -5,9 million (12,6). Cash flow from investments totalled EUR -2,5 million (-13,7).
During the financial year, account limits totalling EUR 15 million were introduced to secure the corporation’s financing during the Covid-19 transition period.
No loans were amortised during the financial year.
Interest-bearing liabilities totalled EUR 7,0 million (5,5) at the end of the financial year. The balance sheet total was EUR 99,9 million (116,6). The financial statement shows that the equity ratio was 87,8% (85,2).
The debt ratio is 8,4%.
The Finnish Fair Corporation Group’s taxes were EUR 0,2 million (-0,2).
The Finnish Fair Corporation Group’s investments totalled EUR 2,3 million (13,9) representing 11,4 (23,5) % of the turnover. Premises-related replacement and maintenance investments amounted to EUR 0,1 million, information technology investments amounted to EUR 0,7 million and AV technology purchases EUR 0,9 million.
Outlook for 2021
Net sales and earnings for 2021 will increase from 2020, provided that the vaccination programme in Finland proceeds as planned, but still clearly falls short of normal year levels. Raising vaccine coverage to 70-80% is the most significant factor in activating business. To curb indebtedness, we will continue to maintain strict and tight cost discipline and seek new temporary businesses for the large hall and meeting facilities. In order to adjust costs to the new business level, co-operation negotiations were initiated at the beginning of 2021 with the aim of achieving permanent reduction in the cost level, especially in personnel costs. We will continue investments to secure the future, both in terms of personnel and other resources, but taking into account the current volume of business.
Risks and uncertainties
The failure of the vaccination programme and the continuation of the Covid-19 pandemic even after the summer, is by far the biggest and most significant risk to the business. The portfolio of events is well established, but the continuation of the pandemic will weaken its restart and volume. Safety is part of the quality of events. The safety expertise of Messukeskus includes e.g. comprehensive safety systems, trained staff, a serviced property, ongoing supervision, safety planning and close cooperation with authorities.
Personnel and property risks are mitigated through systematic risk management. The financial effects of the risks have been covered with property and business interruption insurance.
The Group employed an average of 202 (205) full-time employees and 1 (2) part-time employee. Salaries and fees totalled EUR 8,9 million (12,2).
|Group key figures||2020||2019||2018|
|Turnover, EUR 1000||20 152||59 336||56 412|
|Change in turnover, %||-66,0||5,2||-6,4|
|Operating result, EUR 1000||-13 496||2 616||1 207|
|% of turnover||-67,0||4,4||2,1|
|Return on equity, %||-16,8||2,6||0,6|
|Equity ratio, %||87,8||85,2||77,0|
|Personnel on average during the financial year||202||205||210|
|Salary amount for the financial year, EUR 1000||8 936||14 447||13 969|
Supervisory Board 31.12.2020
VAPAAVUORI JAN, Mayor, Chairman of the Supervisory Board
LAPPALAINEN TIMO, Managing Director, Vice Chairman of the Supervisory Board
Members and the year of termination of membership:
AHLFORS GUNTA, Senior Expert, 2021
ALKIO KIMMO, President and CEO, 2022
ARAJÄRVI PENTTI, Doctor of Laws, 2021
BRAX TUIJA, Secretary General, 2023
ESKOLA JAAKKO, President and CEO, 2021
HEIKKILÄ TAAVI, General Director, 2022
HELANDER MIKKO, General Director, 2023
HIRVOLA JAAKKO, General Director, 2021
HURME ANNIKKA, President and CEO, 2022
HÄKÄMIES JYRI, President and CEO, 2022
HÄMÄLÄ ILKKA, Managing Director, 2023
JAATINEN TIMO, President and CEO, 2023
KALSTA PIA, CEO, 2023
KIVINIEMI MARI, CEO, 2023
KOUSA TUULI, Director, 2021
MANNER TOPI, Managing Director, 2023
MATTILA VELI-MATTI, CEO, 2022
MOISIO JUKKA, President and CEO, 2021
PAANANEN ILKKA, CEO, 2023
PESONEN JUSSI, President and CEO, 2022
TARKKA LAURA, CEO, 2022
VAURAMO PEKKA, President and CEO, 2023
WITZTHUM CHRISTOPH, Chairman of the Board, 2023
ZYSKOWICZ BEN, MP, 2021
The General Meeting held on 8 April 2020 re-elected the following members of the Supervisory Board for a new three-year term: Tuija Brax, Mikko Helander, Timo Jaatinen, Pia Kalsta, Mari Kiviniemi, Ilkka Paananen and Pekka Vauramo. The General Meeting also elected the following as new members of the Supervisory Board for the term ending 2023: Ilkka Hämälä, Topi Manner and Christoph Wizthum.
Members of the Supervisory Board received an attendance allowance of EUR 1,000 per meeting. In addition to attendance allowances, a monthly remuneration of EUR 1,000 was paid to the Chairman.
Board of Directors
The Board of Directors has five members. As at 31 December 2020, the members of the Board of Directors are:
Mr Hannu Syrjänen Chairman of the Board
Mr Juha Rantanen Vuorineuvos
Mr Sam Nieminen. CEO
Ms Leena Niemistö Board professional
Ms Anu Nissinen CEO
Members of the Board of Directors received an attendance allowance of EUR 2,000 per meeting in 2020. In addition to attendance allowances, a monthly remuneration of EUR 2,000 was paid to the Chairman.
Ms Anni Vepsäläinen, Managing Director
Mr Mikko Horppu, Director Exhibitions business unit
Ms Kristina von Konow, Director Events, Meetings and Conferences business unit
Ms Maria Mroue, Director.Marketing and Communications
Mr Petteri Nissinen, CFO
Mr Mika Vakkilainen, Property and Production Director
Oy Tuokko Ltd
President of the Republic Sauli Niinistö
Combined numbers of members and shares in the Corporation
As at 31 December 2020, the Corporation had 198 members holding a total of 44,278 shares.
Proposal of the Board of Directors for distribution of the profit declared
by the Finnish Fair Corporation
DISTRIBUTION OF PROFIT
|Retained earnings||5 287 405,68|
|Profit for the financial year||-10 667 591,62|
|Amount disposable by the General Meeting
pursuant to the By-laws of the Corporation -5 380 185,94
The Board of Directors proposes that out of this amount: 0,00
a 6% interest payout on participation shares be paid
leaving under retained earnings -5 380 185,94