oOh!media H1 2023 Results

Tristan Cotterill

oOh!media Limited (ASX:OML) (oOh!) this week announced its financial results for the half year ended 30 June 2023 (“1H23”).

The Company reported adjusted net profit after tax of $20.5 million, which was ahead of the prior corresponding period (1H22: $20.4m).

The completion of the Company’s on market share buyback during the period resulted in a 6% increase in adjusted NPAT per share to 3.6 cents.  The Board declared an interim dividend of 1.75 cents per share, fully franked, an increase of 17% on the prior corresponding period.

Financial Summary

  • Revenue up 7% to $296.6 million – continued momentum towards the end of the half with strong double-digit sales growth in May-June
  • New contracts secured representing ~$30 million in annualised revenue upside from mid-2024; provides significantly enhanced coverage across Sydney CBD and inner metropolitan market
  • Adjusted EBITDA [2] of $49.6 million, down 4%, reflecting increased fixed rent relating to renewal of some larger contracts during CY2022 and lower rental abatements in 1H23
  • Adjusted NPAT of $20.5 million compared to $20.4 million for 1H22
  • Successful completion of on market share buyback – adjusted NPAT per share up 6% to 3.6 cents per share
  • Statutory net profit after tax of $6.4 million, up 6% (1H22: $6.1m)
  • Financial position remains strong – gearing ratio (0.9 times) remains within target range
  • Interim Dividend of 1.75 cents per share, fully franked, up 17% payable on 21 September 2023

Chief Executive Officer, Cathy O’Connor, said oOh! continued to successfully leverage the strong growth in Out of Home which continues to outperform other media formats, taking a record share from traditional media during the period.

“Out of Home (OOH) reported double-digit revenue growth in the period of 11.9% with digital revenue continuing to drive sector growth.  Out of Home captured 14.0% of agency media spend in 1H23, surpassing the 1H19 peak of 13.7%, and was also the fastest growing agency media segment, with growth of 14.7% compared to a 4.2% decline for total advertising agency spend for the industry.

“oOh! delivered a 7% increase in revenue for the half year, which was in line with the OOH market (excluding City of Sydney).   Momentum continued to build towards the end of the period with strong double-digit sales growth in May and June.

“Our Road format continued to grow strongly with revenue up 12% for the period and also performing well ahead of pre-pandemic levels with 1H23 revenue up 33% on 1H19.   Meanwhile, the continued recovery in air travel generated revenue growth in our Fly category which was up 73%.”

Ms O’Connor said oOh! continued to engage constructively with commercial partners in relation to renewing key concessions.

“While there has been no material change in status for leases expiring in CY23 since our last update in February, we continue to have positive active dialogue with our lease partners.  We remain confident that the strength of our market-leading Out of Home offering positions us well in these renewal processes.

“Separately, we continue to target new revenue opportunities to further enhance the diversity and scale of our metropolitan and suburban network.

“During the period we successfully secured three new contracts representing approximately $30 million in annualised revenue upside from mid-2024.

“These contracts, including Sydney Metro, Sydney Metro Martin Place Station and Woollahra Council, also provide significantly enhanced coverage across the key Sydney CBD and inner metropolitan market to deliver network advertising solutions for our customers.

“We continued to make good progress on our strategy which remains focused on driving revenue growth through leveraging our portfolio of existing assets with continued investments in digital and data capabilities to improve advertisers’ return on investment.

“We refreshed our data planning and attribution feed, partnering with Unpacked by Flybuys, Australia’s top-rated customer loyalty program, and DataX from Westpac.

“These new partnerships continue to position oOh! as offering best in class data-led planning and attribution insights to demonstrate the return on investment for customers’ Out of Home spend,” she said.

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