Outfront is recovering slowly from Covid.  Here are the results from the company’s fourth quarter 2020 earnings release and earnings presentation and conference call.

• Revenues declined by 31% to $336 million in the fourth quarter of 2020.  Billboard revenues were down 13%.  Transit and other revenues (sports marketing and transit) were off 65%.  The company’s US billboard yield (average revenue per face) declined from $2,403 in the fourth quarter of 2019 to $2,142 in the fourth quarter of 2020 as you can see below.

• Total Expenses declined by 27% to $252 million for the fourth quarter of 2020.  Lower transit fees accounted for more than half of the expense reduction.  Here’s a breakdown on expenses by category.

• Adjusted Cashflow (OIBDA) declined by 41% to $83 million in the fourth quarter of 2020 due to reduced revenue.
• Capital Expenditures totaled $11 million for the fourth quarter of 2020, down from $35 million during the fourth quarter of 2019.  In addition the company spent $37 million adding an additional 663 digital displays to its MTA plant in New York City.

CFO Matt Siegel said OUTFRONT is going to increase capexp next year

..As we look at 2021, we expect total CapEx of around $85 million in total, including $55 million of growth CapEx, which will be back to our pre-pandemic levels. And we expect to add 150 to 200 digital billboards to our portfolio this year, similar to 2019.

CEO Jeremy Male said revenue will be down 20-30% in the first quarter of 2021

Right now as we look at the first quarter, our total revenue expectation is to be in a very similar range for the full quarter, down high 20% to 30% on a year-over-year basis, adjusting for the sports business sale.

CFO Matt Siegel says the company’s $700 million cash will go towards growth capexp, acquisitions and maybe a dividend.

We’re using the cash to continue our return to offense….we increased our CapEx spend for 2021 from 65 to 85, hoping to drive more digital conversions than we did in the past years. We’re turning the MTA deployment a little higher again to further our digital install base. And we’ve closed a couple of small acquisitions which we put on hold from the pandemic and we’d like to do more whether small, mid size or a little larger….our Board will continue to work at our business prospects taking into consideration our liquidity and our requirements and think about dividend at some point during the course of this year.

Insider’s take:  Looks like it will be the last half of 2021 before OUTFRONT returns to normal although management is confident enough to resume capital spending.  OUTFRONT closed down 5.5% on a day when the S&P 500 was off 2.5%, Lamar was off 3.7% and Clear Channel Outdoor was off 12.5%.

[wpforms id=”9787″]

Paid Advertisement