Which Out of Home company grows revenues faster than expenses?  Look at the chart below.  Insider computed the change in revenues and expenses for Clear Channel, OUTFRONT and Lamar for the past 7 years.

Lamar is the only company which grew revenue faster than expenses.  Lamar’s revenues grew 5.8%/year for the past seven years versus growth of 5.5%/year for expenses.    A tuck-in acquisition strategy (e.g. add revenues and steel but not people) is working as is a decentralized office structure where corporate exists to serve the branches rather than the other way around.

Revenue and Expense Growth for Clear Channel Outdoor, OUTFRONT and Lamar

2012-2019

Millions

Clear Channel Outdoor revenues and expenses declined by 1.3%/year and 1.1%/year, respectively, over the past 7 years.  Corporate overhead has increased by 3%/year for the past 7 years even though revenues have been declining.  Not sustainable.

OUTFRONT revenues grew 4.8%/year for the past 8 years versus 5.5%/year growth in expenses.  This trend continues into the past year where revenues increased by a healthy 11% but expenses were up by 11.8%.  OUTFRONT has shown it can grow revenue.  Insider has yet to see evidence that OUTFRONT can keep expense growth below revenue growth.

[wpforms id=”9787″]

Paid Advertisement