JCDecaux released first half 2020 financials yesterday and the results weren’t pretty for this urban out of home and transit advertising company.   We’ve translated the financials from euros to dollars.

JCDecaux Financials for first half of 2020 (million’s)

• Revenues declined by 42% to $1.2 billion of the first 6 months of the year.  Second quarter revenues declined 63%.  Street furniture, transport and billboards were all down in excess of 60% during the second quarter due to the impact of covid on transit ridership and traffic.  Jean-Charles Decaux said this about the drop: ” During the Covid-19 lockdown period, the temporary historic drop in urban and transport audiences as well as severe economic uncertainties led companies to react immediately and to reduce their advertising spend in an unprecedented scale. Once lockdown measures were lifted, urban audiences started to recover progressively in Street Furniture and in Billboard while Transport audiences are still lagging significantly, mainly in airports.”
• Direct Expenses declined by 26% to $1.3 billion during the first half of 2020.
• The Operating Margin (EBIDTA) declined from $360 million during the first half of 2020 to a deficit $73 million during the first 6 months of 2020 due to the drop in revenues.
• Jean-Charles Decaux was downbeat about the rest of the year: “Advertising revenue has, for the time being, not followed the same pace of recovery and we see an important difference between audiences’ levels, which are in some geographies close to pre Covid 19, and revenue levels which do not yet reflect the positive momentum in urban audiences.”

Insider’s take:  Out of home right now is split into haves and have-nots.  Roadside billboards are haves.  Transit and airport and heavily urban boards are have-nots.  Decaux’s performance could be a proxy for OUTFRONT because both companies are heavily dependent on urban and transit advertising although Insider suspects OUTFRONT will have more success than Decaux at reducing expenses.  Outfront releases financials next Wed.

JCDecaux ended the day down 8% in US over the counter trading.  The S&P 500 was down 0.4%, Lamar down 1%, OUTFRONT down 2%,  Clear Channel Outdoor up 2%.

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