Outfront Media reported financials for the three months ended June 30, 2016 yesterday.  You can read the Outfront press release here and the Seeking Alpha earnings transcript here.

• Revenues increased $0.6 million (0.2%) to $385 million during the second quarter of 2016 as billboard and transit growth was offset by  the sale of the company’s latin american outdoor business.   US revenues were up 6%.  Billboard revenues were up 4.3%, excluding the impact of  acquisitions.  Transit revenues were up 7%.

• Cashflow for the quarter increased by $4 million (3%) to $123 million during the second quarter of 2016 due to increased revenues.

• Outfront spent $16 million on capexp during the second quarter of the year including 11 new digital signs in the US and 1 new digital sign in Canada.  Outfront has converted 52 static boards to digital during the first half of the year and is on pace for 100 static to digital conversions for 2016.

• Outfront has upgraded 10% of billboard lights to LED fixtures.  The company plans to have 20% of the plant upgraded to LED by the end of the year and the rest of the old lights upgraded over the next two years.

• Total debt was $2.2 billion which puts Debt/Cashflow was a reasonable 4.47, well below Clear Channel Outdoor’s Debt/Cashflow of 7.6.  CFO Donald Shassian stated on the call the Outfront wants to reduce leverage to 3.5 to 4.0 times.  Are you listening Clear Channel?

Insider’s take:  Outfront’s US boards seem to be performing in line with the rest of the industry.  Transit is doing well.  The digital conversions makes sense as do the LED lighting upgrades.  Insider achieved a 44% return on capital by replacing LED lights on one of his older static billboards.  Talk to Formetco or Reliable Electric about replacing your old lights with high efficiency LED’s

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