Here are the highlights on Clear Channel Outdoor CFO Brian Coleman’s comments at the B of A Leverage Finance 2022 conference this week.
Is Clear Channel Outdoor positioned for slower growth?
I think we’re well positioned…The business…really isn’t seeing a slowdown…things look pretty good…We feel good about our liquidity position going forward…I’ve kept our liquidity balance pretty high. It’s over $500 million at the end of the year so we feel we’ve got a bit of a war chest…
Europe sale moving slowly
It’s been nearly a year since we announced the strategic review…when we went through that process what appeared to be the simplest and easiest to execute was a platform sale – a sale of all or materially all of the businesses…With headwinds in the business, the invasion of the Ukraine, the capital markets weakening particularly in Europe…we learned that was not the best path forward…In May we announced we were taking a different position…let’s take a look at the lower margin or the businesses that have less to contribute and take a look at selling those…market by market, region by region…There were few strategic buyers that could buy the whole platform, but if you go market by market, region by region you pick up strategics, you pick up…a new buyer base. That has gotten some traction…
How will European proceeds be used.
We have a series of bonds that sit at the CCIVV level – about $375 million. We’re going be limited with our freedom with respect to use of proceeds. There is a restricted payment basket of about $25 million…but other than that any kind of proceeds would need to stay…
What’s up and what’s down
Amusements, travel, entertainment, movies – they’ve all come back. I think the only category…that has not come back is…auto insurance…
M&A
We’ve done over $50 million of M&A. Largely in the US, largely digital, for the past year. We’ve got some stuff in the pipeline that’s likely to tail off a little bit given the current macro environment.
Target Debt/Cashflow
Is it 4 times? Is it 6 times? Is it somewhere in between? There’s a lot of work to be done on that front.
Billboard Insider’s take: A Clear Channel Outdoor Europe sale won’t be deleveraging and won’t create excess cash because the money will have to pay down $375 million in bonds on the Europe assets. But a sale will be a win by eliminating the distractions of running an under-performing group of assets which is diverting capital spending from more productive uses in the US.
[wpforms id=”9787″]
Paid Advertisement
