Here’s a selection of OUTFRONT CEO Jeremy Male’s comments at the Morgan Stanley Conference this week.

The outlook

…We certainly feel and see far more positivity…we had a financial advertiser come in with a significant buy for New York Transit with a September laydown with the expectation that by then we are going to see audiences increasing…

Digital signs

At the moment…3% of our boards are digitized…the IRR’s that we are able to achieve…typically well over 20% when we digitize a board…

Occupancy is down, not rates

In Q4 our yields were down in double digits, a majority of that was in occupancy, not in rates.

What does New York subway ridership need to get to before advertisers re-engage?

We have a couple million riders on the MTA right now.  2 million is still a big number…We need to see some sort of step up…We don’t need to get to 100% of previous ridership to get 100% of previous dollars.

Long term margins

We were 29% OIBIDA margin coming into the pandemic and we’ll be at 29% coming out of the pandemic.

M&A

We’ve switched the tap back on in terms of organic development.  We’ve switched the tap back on in terms of Tuck ins…We’re a little disappointed in terms of activity.

Insider’s take: the lack of acquisition activity is probably because large out of home buyers like OUTFRONT want recovery risk priced into purchases and sellers don’t want recovery risk priced into sales.   This means that small market out of home sale will occur sooner because small markets have recovered from covid.  Larger market out of home sales may take longer due to recovery risk.

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