• Clear Channel Outdoor Revenue and Cashflow up in 1Q 2018

    Clear Channel announced first quarter 2018 earnings yesterday.  Here’s a summary of the earnings release, slide presentation and seeking alpha transcript.

    • Consolidated revenue increased 9.9% to $598 million due to international sales growth and the impact of foreign exchange movements.   Americas revenue (US and Canada) declined 1.7% to $256 million due to the sale of the Indianapolis and Canada business.  Americas organic revenue was up 0.1% when adjusted for asset sales.  CFO Rich Bressler mentioned that local was up and national was down.

     

    • Consolidated Cashflow (OBIDAN) increased 13% to $78 million due to increased revenue.  Americas cashflow was up 3% to $82 million to reduced operating expenses.  Here’s a breakout of performance of the Clear Channel Outdoor’s US and Canada operations.

    • The company added 36 new digital displays in the US first quarter of 2018, for a total of 1,228 displays across the US.  CFO Rich Bressler was asked about the payback on digital sign conversions.  He would give specifics but said the payback was significantly less than 5 years.

     

    • Transit and airport advertising added contracts for San Diego Metropolitan Transit, Hartford’s Bradley Airport, and buses in Stockholm.

     

    • The company remains leveraged with Total Debt/Cashflow of 8.8  at March 31, 2018.  Insider doesn’t think this is sustainable.  Lamar and Outfront have Total Debt/Cashflow targets of 3.5-4.0.  Clear Channel is discussing a renewal of its revolving line of credit in August.  Insider doesn’t think these talks are critical because the revolver has no outstandings.  The big year is 2020 when $2.6 billion or nearly half of the company’s debt expires.

     

    Insider’s take:  America’s revenues are treading water but it’s nice to see OBIDAN increasing.  Clear Channel Outdoor stock closed down 5% to $4.45.

     


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