OUTFRONT CFO Matt Siegel spoke at Oppenheimer’s 26th annual tech, internet and communications conference last week.  Some of the highlights.

OUTFRONT’s business

We have a major presence in large cities focusing heavily on New York Los Angeles and growing Miami. In transit we have operations and trains commuter rail buses bikes also focusing on major cities…the Billboard business has been super strong and since the pandemic with a strong recovery…transit obviously still has this challenges with ridership not returning to usual.

Why OUTFRONT took a $511 million writedown on the transit business in the second quarter of 2023.

Our portfolio was greatly impacted…first during the pandemic and post pandemic as people have changed their commuting and traveling habits ridership…in all of our transit franchises is down…more than 50% in San Francisco…down 30% like New York…in the first quarter of this year transit the growth of transit stalled…we didn’t think it was a cause for concern…then we came into the second quarter and we see transit still flat and our forecasting our pacing for the rest of the year isn’t very robust… we took a write down, an impairment charge a little over $500 million to our transit business…we also felt the need to change our full year guidance….

OUTFRONT will sit out the M&A market for the next few quarters.

We haven’t entered into any new acquisition agreements. We’re closing a a few things that were committed to in 2022…I think that lower volume is likely to continue into 2024…you may have noticed that our multiple has declined…our leverage is higher than we’re comfortable with so we’re likely…to be less active and focus on on reducing our leverage for the next few quarters.

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