“Our performance reflects healthy demand from advertisers across a majority of our markets, with notable strength in our airports and Europe-North segments,” was how CEO Scott Wells summarized Clear Channel Outdoor’s 2Q 2024 financials. Here is an analysis of the Clear Channel Outdoor 2Q earning release, 2Q 2024 earnings presentation and 2Q 2024 earnings call sponsored and analyzed by SignValue
- Consolidated revenue increased 5.4% to $559 million. US billboard revenue grew 0.9% to $290 million. Airports grew 21%. Europe North grew 9% to $165 million. Clear Channel Outdoor CFO David Sailor projects 3Q 2024 consolidated revenue growth at 3-8%.
- Clear Channel Outdoor’s US billboards had anemic results. Revenue grew only 0.9% and cashflow declined by 2% due to higher compensation cost and higher credit expense for reserves for specific customers.
- At June 30, 2024, Clear Channel Outdoor had $5.6 billion of debt with a weighted average cost of 7.4%. Total debt/cashflow(EBIDTA) is almost 10:1.
CEO Scott Wells says a sale of Europe North is progressing
Negotiations for the sale of Europe North remain ongoing. The team is performing very well, executing a focused strategy…We remain committed to exiting Europe…In our latam sale process we are making good progress…I would much rather sell a business that’s performing than a business that is struggling. I feel really good about the performance of Europe North…
The national market is strong in airports and weak for US billboards
It is a tale of two marketplaces…it’s different in airports vs roadside…on national…it is very competitive and advertisers have a lot of choices…you can’t just count on RFPs flowing through agencies…
Wells doesn’t expect a recession
Our canary in the coal mine is cancellations and we haven’t seen any uptick…
SignValue’s take: Some good and some bad in this quarters results. The good: airports thriving and Europe North improving and headed for a sale. The bad: US billboards are struggling due to weak national sales and total debt/cashflow is almost 10:1 A challenging situation for Clear Channel Outdoor’s management,.
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