San Antonio, Texas-based Clear Channel Outdoor Holdings, Inc. [1] reported its financial results last week for the first quarter ended March 31, 2016.
[2]Results showed a 1.8% increase in onsolidated revenues after adjusting for a $15 million impact from movements in foreign exchange rates and the $20 million impact of the non-strategic outdoor markets it sold in the first quarter of 2016.
On a reported basis, consolidated revenue decreased 4.0%.
Other key figures included:
- Americas revenues increased $12 million, or 4.2%, after adjusting for a $5 million impact from movements in foreign exchange rates and a $20 million impact from the sale of non-strategic markets. The increase was driven by higher revenues from digital and static billboards. On a reported basis, revenues decreased 4.5%;
- International revenues decreased $1 million, or 0.3%, after adjusting for a $10 million impact from movements in foreign exchange rates. Revenue growth in certain countries including Australia, China and France was offset by decreases in other countries including the UK and Switzerland. On a reported basis, revenues decreased $11 million, or 3.4%;
- OIBDAN increased 4.8% excluding the impact from movements in foreign exchange rates and the impact of the non-strategic outdoor markets sold in the first quarter of 2016. On a reported basis, OIBDAN decreased 3.8%.
“We’re pleased with our progress at both our Americas and International outdoor operations, as we continued to win major contracts and roll out a full range of new technologies to better serve advertisers and consumers,” said Bob Pittman, executive chairman and CEO of Clear Channel Outdoor Holdings Inc. “Americas Outdoor’s streamlined organization is redoubling its focus on customers while bringing powerful innovations to market, including our data analytics solution that uses aggregated, anonymous, statistical insights from third-party data providers to enable marketers to better target their campaigns, and programmatic initiatives aimed at making it easier for agencies and advertisers to buy inventory. At International, our business plan is starting to drive results, as we are successfully bidding for the right opportunities at the right price.”
“Americas outdoor delivered top- and bottom-line growth in the quarter after adjusting for non-strategic asset sales, with International essentially flat, excluding the impact from foreign exchange rates,” said Rich Bressler, the company’s CFO. “Americas outdoor continued to optimize our footprint during the quarter, enabling us to better focus our operations and free up resources for more investments in innovation, and at International outdoor we won a number of key contracts in the quarter while continuing to build out our digital business.”
Key non-financial highlights during Q1 included:
- The introducton of RADAR, America’s new data analytics solution to plan and buy out-of-home media and use aggregated, anonymous, statistical insights from third-party data providers to enable marketers for the first time to use the same sophisticated audience segmentation, targeting and insights for OOH advertising already available to their digital campaigns;
- An eight-year contract wa signed to provide new, state-of-the-art display advertising with interactive technology both indoors and outdoors at Washington Dulles International and Ronald Reagan Washington National airports to reach a combined 41 million travelers annually, expanding America’s leadership in digital OOH media in the Washington, D.C. metropolitan area;
- Expansion of the digital street furniture network and launch of Adsmart in Australia and New Zealand through Adshel – International’s joint Australia/New Zealand venture with APN , This will add 365 digital screens for a total of 825 in the two countries and provide an ad-serving platform to enable advertisers to enhance their campaigns based on time of day, place, audience, context and business;
- The awarding of a seven-year advertising contract for Asda stores in the UK, including a complete re-build of Asda outdoor billboard and poster sites, as well as digital screens powered by International UK’s intelligent content management system – Play iQ – at up to 300 superstores;
- The awarding of a 12-year contract to manage Madrid’s street furniture – one of the largest in Europe – that features environmental sustainability, universal accessibility and the most innovative communication and public engagement channel available anywhere across 1,610 advertising panels, including 300 digital with 350 WiFi spots, to better serve consumers and advertisers. This award is subject to an appeal under the applicable administrative legal procedures in Spain;
- Installation of 980 digital displays across CCO’s markets, increasing the digital billboards to 1,056 in 28 markets in North America and to more than 7,645 across 19 international markets;
- The hiring of Wade Rifkin to the newly created position of senior vice-president of programmatic to develop Americas Outdoor’s programmatic strategy and to work closely with its technology, marketing and sales operations teams to make it easier for agencies and advertisers to buy inventory.
In the first quarter of 2016, Americas Outdoor sold nine non-strategic outdoor markets including: Cleveland and Columbus, Ohio; Des Moines, Iowa; Ft. Smith, Arkansas; Memphis, Tennessee; Portland, Oregon; Reno, Nevada; Seattle, Washington; and Wichita, Kansas; and certain advertising assets in Florida for net proceeds of $596.6 million. The Company recognized a net gain of $282 million.
On the international scene, decreases in revenue were driven primarily by lower revenue in the UK as a result of the London bus shelter contract not being renewed and decreases in Switzerland.