CCO - Earnings call transcript Q1 2024 | Clear Channel Outdoor Holdings, Inc.

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Unknown Executive

Good morning, and thank you for joining our call.

On the call today are Scott Wells, our CEO; and David Sailer, our CFO. They will provide an overview of the 2024 first quarter operating performance of Clear Channel Outdoor Holdings, Inc., and Clear Channel International B.V. We recommend you download the earnings presentation located in the financial section in our Investor website and review the presentation during this call. After an introduction and a review of our results, we'll open the line for questions, and Justin Cochrane, CEO of Clear Channel U.K. may Scott we during remind about begin, during call, join of Q&A everyone its will regarding this call.Before statements and the I'd we goals. future Europe, financial and including its the Dave portion that the performance and company, forward-looking strategic statements make like to expectations. achieved assurance expectations, beliefs from or All forward-looking uncertainties, and not management's risks actual and there will will that be or statements involve can that results be no projections differ review risk with press SEC.During also Please of generally release principles. and that today's will accepted earnings statements in our to measures the contained we not certain our the refer conform accounting do filings to call, basis schedules presentation. these We that as our non-GAAP of reconcile reported the with earnings a provide measures part GAAP results on note the #X to today, XXXX, May to turn provided call on Also, the will to I longer of X, at the turn earnings time information a of call now this Scott. Slide be management's over as please in speaks that the accurate presentation, views and no and may only replay.Please

Scott Wells

driven thank our into exchange digital across revenue record markets was exchange business and X.X% quarter on quarter. which our nicely, sold on strategic aimed of Verticals as were of the of results, and you of Many in our $XXX during compared quarter, first margin the including foreign the a media America, majority amusements platform the in quarter, growth Europe-North These we for print in the taking Performance in in focusing our large range to channel, join the remain in is continued rates. first continued with part serve everyone, broader a guidance, us bounced quarter include focused movements saw consolidated locations, reflect today. into first fourth Airports delivering million and local our morning enhancing our that technology to Good most first line We excluding movements to for advertisers.In prior year. integrating broad-based back excluding revenue and of sales our rates, time which reflecting We segment, our the higher foreign delivered growth for business, the to increase the services, margins. our trends grow strengthen to profitability right and at secondary ability plan, helped U.S. the assets, by delivered on entertainment. markets. the America which and

national into We a continue to new brands develop against demand. the backdrop bring of sector mixed ways proactively inbound we can

team sales our the in impact drive sales teams targeting. of channels. Overall, verticals we're offense will business number attracting playing sales incremental the Our double-digit in revenue our we're national strong performing growth continues quarter, well, a We very with in key from professionals believe CPG. enhance a to this continuing to we generate positive and directly current programmatic is both we're first including a efforts, very effectively believe across delivering incremental in the pursuing and revenue. pharma quarter.Supporting And increase have

mobile media out-of-home's moving that experience critical how to delivery us into step is innovate stores behaviors media app driving to data piloting drives expect out-of-home how also get performance, on doors RADAR to to their starting continue opening customers advertisers how insights advertisers For continue in weekly the previously and the Regular impact are performance. performance and our Channel's advertise is from performing.We to around example, a Clear campaign are our restaurants innovation to our closer out-of-home markets. campaign data updates visits by into that verticals, are of solutions campaigns bring around customers digital in and where on initially new new measurable unavailable providing a approach marketplace, on media.We

a more app's completed For content. exposed inventory the digital as remains to data way millions in with example, leveraging working travelers. driven progress try to of deeply We're engaged reinforces to It's mobile business connect airports encouraging in brands a verticals. campaigns premium continued brand's multiple marketers were accessing one that drive with for that nature of the the were more and app across demonstrated platform to ads robust, for importance more our of Airports, with our budgets.Turning incremental consumers QX study entertainment we likely audio that looking major by strength of the leveraging a our and to

team term York congratulate the Europe. at, maturities, advertiser what visible increase last across movements that year, March, and dynamic ongoing sheet, mix quarter we us also on of XXXX results, New and in will continue in business are M&A later allowing foreign particularly mid-single quarter that of in the the airports, M&A I the digital with to on we also to exchange New successfully locations and is market.With track, Dave but high-volume excluding our strong the well as sell, rates. I want displays transactions full strong volatile markets, our expected which in The revenue take We by the including guidance, process to last highlight as our advantage invest details, inventory quarter we commitments We installed in given in second with airports. are premium these our and largest expand strength year on the continuing growth been to will regard and through U.K., platforms digits to extended additional in go in the in a to around executing in has our Football created deliver the flexibility, is efforts.Moving with Jersey refinancing details the the greater the XXXX supporting continuing year, confirming recently guidance, European rates CCIBV continued our loan consider, a the has over favorable great in Dave key The want to but to been balance digital the the first momentum announced momentum highly to Sweden the buoyed Belgium. continue impressive us of seen to notes second do these demand.Europe-North providing Championship.

So performance. overall, we're pleased with our

bode overall new and of longer in benefiting addition we're positive levels our the for from economy, term These of sales investments and In impacts data in growth growth initiatives the our our profile. digital, seeing to in our on course, teams, various in from analytics. all well programmatic website,

segment are On with continue counterparties to the we we potential engage LatAm. in negotiations M&A the front, Europe-North our sale and of on in

the able.With the hand call Dave. to we're let that, update market We when and me over will as

strong with As you was in made him forward transition, on CFO we our move has may forward plan. promoted as partnership a know, seamless look Dave strategic to He March I executing to a and X.

David Sailer

teams as Thanks, for Scott. Slide I new this transitioned provided overview the Good an #X me morning, all into role.Please of I've support have appreciated the everyone. see results. our

a discontinued in reminder, As included operations. is Europe-South

performance. from SG&A and also our movements foreign Additionally, other our expenses provides to the reported quarter about costs are measure. during I'll noted.Now excluded XXXX adjusted evaluating to exchange onto this expenses comparability was unless excluding are result a GAAP rates, of in our talk greater include million, segment the XXXX when for quarter operating referred discussion results, first percent for quarter restructuring are non-GAAP revenue results. first and otherwise and XX.X% Direct the We EBITDA XXXX, that the and amounts $XXX increase. of first a changes the I adjusted first compared Consolidated EBIT. of The quarter quarter believe

$XX revenue was million, up consolidated compared rates, Loss exchange foreign was year. million. million, EBITDA the net for $XX in the loss, improvement movements operations, an which includes Adjusted $XXX $XX as was X.X%. up Excluding operations the discontinued also continuing to from was prior million, XX.X%. quarter loss Consolidated from

movements Airports. largely million was an rates, the exchange Excluding the is first of AFFO $XX quarter, negative increase America The adjusted driven in XX%. in was and improvement XX.X%. by foreign up EBITDA

increase with margin EBITDA Billboard are Airports' in higher, revenue to movements $XXX revenue in XX.X%. by adjusted largely XX.X% the strong lease and America The Direct XX.X%.Onto increased results up driven Digital was $XX XX.X% up up segment Local $XX rates, the expense driven was quarter in credit and up the and million, accounted Airports. by improvement renegotiation exchange demand in EBITDA million. segment accounted are X.X% a slightly, XX.X% accounted million. up in results. was existing all million. $XX the loss revenue, revenue, regions. XX%, operating National accounted of part for accounted XX.X% expense by XX.X% at print expense compensation America flat, increased first of an first of across costs up X.X%. Segment driven in XX.X% revenue million, a improvement million, were Excluding of sales, revenue increase The foreign $XX XX.X%, segment by deployments, was EBITDA was reflecting XX.X%. America adjusted was to and lower the sales #X margin the XX.X%, favorable headcount, over driven accounted of Slide XX.X% EBITDA X.X%, up of Site was revenue The for higher EBITDA digital adjusted million, pay a lease which see mix.Please Digital performance revenue, adjusted driven higher was AFFO for revenue, up quarter operating loss revenue, with in and up demand segment of revenue $XX is portfolio. which to year. by America XX.X%.Direct the the SG&A contract.Segment compensation Airports for Slide XXXX, were site is were with up by the by prior for credit for #X. million, offset and lower for X%. bulletins. were which and with primarily XX.X% in Local revenue segment sales Higher expenses both to down airports costs $XXX revenue, the sales, up in revenue, and addition for which to growth increases, margin of was National EBITDA increase revenue, by America in with review an for and in commissions. sales for to an digital adjusted improvement due driven Airports' increased a were adjusted XX.X%, strong of XXX.X%, #X was $XX SG&A $XX expense. largely Slide large million. expenses the up of increase quarter.Onto revenue margin driven

slightly SG&A Norway. X.X% to $XX $XX costs.Europe-North loss for to compensation down that EBITDA of in due Europe-North Europe-North, review $XX revenue foreign This $XXX rates. results higher direct in accounted segment million, been by the my and decrease total XX.X% to had million. the partially expense, loss to exchange which to over segment Norway.Digital offset the and prior the a and Europe-North driven up on a in was increased adjusted Sweden XX.X% XX.X%, deployments, to of expenses revenue Europe-North margin improvement Europe-North by digital to For adjusted was on increased Belgium, of contract million is adjusted our by an U.K., up million to and in was a and X.X% revenue commentary to transit was was the $XXX performance site down by X.X% driven offset exclude in movements year. demand operating due contract lease EBITDA partially million, higher were in

margins Europe-North Channel have fluctuations as or well onto of reported of the loan and International expenses discontinued this borrower results and in for further quarter resulting business quarter of first to increased as revenue CCIBV wholly-owned CCIBV, CCIBV statement Europe-South mix.Moving facility, has these same in $XXX other. CCIBV, the sensitive company Slide included subsidiary former contract.As contract to lowest were more under CCIBV businesses segments is financial and excluded consolidated results #X, historically indirect periods the on segment revenue the below.CCIBV as component of been historically operations, an of The reduced from separate are to to all in Europe-South of in quarter in revenue segment XXXX Singapore, as current and B.V. the of from the Clear the includes results million. as being are first the of EBITDA, from of businesses first considered are XXXX loss discussion a in CCIBV due compared the are and and Singapore XXXX The immaterial our the term results which results presented consolidated for for operations to the period the a the X.X% $XXX continuing of follows: million and the adjusted operations

segment, of revenue revenue the offset million our $X Singapore. X.X%, loss loss million from the of million partially to Europe-North CCIBV's in higher #XX. was $XX contract the totaled a Slide by mentioned, and CCIBV quarter, in both $XX as of Excluding was and operating I CapEx Airports.Now the movements prior timing to loss just $X operating period impact over expenditures. in as same $X FX, increased the of in moving to first America capital onto of #XX a decrease our of XXXX.Now million of review spend due Slide million year CapEx in compared the

million equivalents During to payments, $XXX the due $XXX in cash as payments and first additional million included million decreased by a interest in million, cash result timing. $XX quarter, cash to an which $XX primarily of

of the debt of facility.Our in quarter lower year. million remaining of on paid increase the $X.X as to the decrease loan liquidity Credit as the compared March the end refinancing refinancing slight X% to a million at quarter, March is payment the result $XXX XXXX, XXXX, cash timing is equivalents, of the million XX, in interest the due at the period issued first Senior increased increase in paid higher of as XX, net increase compared related XX, to Facility the Notes same to and the of Specifically, the under billion interest the semiannual of transactions $XX end was March the payment during as term to in of cash was and availability early, the $XX the due cash debt $XX a XXXX. interest The to million prior decline compared well August this Approximately quarter.Our December CCOH for XXXX the due to XXXX, in rates liquidity on Secured to as the in fourth Receivables-Based interest due the down first receivables March.

which the its our Senior among Credit amended to to, loan refinance Secured million into we date Senior agreement in to facility we outstanding tranches Secured remaining our transactions debt mentioned, $XXX a of X.XXX% an used of by other $XXX as extend Notes facility. all during the $X of loan the credit our March the we quarter near-term things, XXXX, Scott reducing the used time, entered Senior $XXX At same totaling principal million Agreement of deferring XXXX, from March the refinancing.On principal XXXX, X successfully by term cash payments and maturity As interest anticipated the that our to term CCIBV of of XXXX.On XXXX principal proceeds XX, term $XXX of aggregate due aggregate borrowings million X.XXX% balance due the XXXX approximately proceeds comprising amount portion terms to under result prepay improved issued our balance executed and a on XX, CCIBV with therefrom in and therefrom and favorable a million, outstanding mature million sheet Secured maturities loan, XXXX. Notes amount redeem XXXX,

weighted X.X%, over year-end. Our was a cost of debt slight improvement average

and exchange year-end. rates, X.XXx, excludes improvement All of lien #XX our As agreement our guidance onto guidance full XXXX, quarter threshold foreign movements of the and with expenditures credit and XX, leverage March was The first cash in guidance is exception payments. XXXX. an year Europe-North for ratio and second capital X.Xx.Now the the consolidated covenant Slide over interest

second increase between $XXX XXXX. second million X% the representing over For X% million, of our consolidated and believe will revenue we quarter, a be quarter the to $XXX

from are guidance, guidance AFFO the year provided reflect February. America adjusted is $XX to loss $XX expected to Cash between information. million. continuing to interest onto is between year we confirming full million operations be be our $XXX and recent $XXX full in revenue revenue, and CapEx and been revised have for million.Moving million revenue and $XXX and revenue be refinancings updated EBITDA to and million the million, Europe-North between expect expected and We other $XXX payments, Airports

payments to $X.XXX $X.XXX revenue between We be billion $X.X to over be revenue representing revenue and between expected expected $XXX and On adjusted $X.XX $XXX to to billion in billion, focus XXXX.America expect $XXX interest is digital Europe-North is continued the expected consolidated anticipate X% to payments. million. XXXX in a having are be be on expected between is timing cash million and to expenditures is Airports in million. between billion. increase and in with in interest million to Capital expected due in obligations of million $XXX million in revenue a and million million AFFO EBITDA is to range be million $XXX differences $XXX and and increase investing $XXX largely million. to guidance consolidated expect basis, million $XX payment U.S.Additionally, XXXX the The XXXX. the $XXX $XXX $XXX year we of between be our cash $XXX compared X% footprint million. a to in prior of the we interest

expect million turn in that now We incur the interest to debt.And This not paid additional cash let call we quarter. or the second guidance of be assumes $XX refinance to back me do Scott.

Scott Wells

our To Dave. trends we're positive we're our team's seeing disciplined and about Thanks, on in business recap, our plan. focus executing the

Our for AFFO you include to serve. modernize our positive. advertisers In our And making flow progress be looks for expect retained we've segments.Summing a to down our hedge we up, EBITDA moving committed Airport or as contributions to adjusted in to organization the hikes, remain our join exposure guidance we call. year discretionary our America our with positive portfolio as Cochrane cash on if will Justin and progress down U.S., we're full in pretty our outlook maturities refinance we rate with point investments rates and by now leveraging me good pursue making from CapEx, out. operating to refinancings, and growth and turn broad-based take time, focus operator, the the the optionality the reduced over year.And to Many progress like streamlining of team XXXX, platform thanks and our on move the let the same company-wide created to room ongoing our performance and expand we of call is us to their the and good view. At the growth our remains across can close we're this range

Operator

Stanley. first The McVeigh Instructions] comes [Operator with Morgan Cameron question the of from line today

Cameron McVeigh

Americas in suggest your the and was XXXX? some national on current how Scott, I then versus was ad AFFO why I your could your growth would And the of we of state divergence. interesting view you performance you it your maybe a local about hoping view, other think beyond thought there's color And any of peers. secondly, in market? discuss

Scott Wells

I competitor report exactly numbers how and there's always I mean going and yes. hard we a lot they a to don't where choose the bridge they them. Cameron, calculate think things of with it's on, know how to

of I call business we and think tied we to see we've you do the pretty think agencies. numbers. what agencies I biggest our is the couple the said, the this biggest in it, placed national look by as at metric. get as I mean, consistent, And and just think how can I at is things a we That's

as think in you as to in the national I a thing. at And the it business. versus of national If much grew thinking America that speaks of look America singular as did challenge in Xx Airports, roadside Airports

the it's a related some compare.I to probably that there differential, particularly to through number things hard do have are think flowing vertical. pharma So we

move may of probably competitors from that's I that place be, particularly it -- fully started a having you than Northern we in QX I have our to pretty other call that and the at other in that in to trail and as but California, recall was won't think that and probably say that it's are at that I'd as of last because be mind. only pick tangible I we needs last stabilized thing we has out the where last California, year, don't year, that direction. are QX to don't and think in partly challenges better significantly and if know, year. had least Dave, those there's that, numbers a success that anything I the don't is Those rough blazing in colors jumps flowing And would that I I would your I probably things think that have through. well. off. much probably -- have the don't it's

David Sailer

No, no.

think covers that it. I

Scott Wells

take And then want do the you to AFFO?

David Sailer

we're as were think of of Yes. the our issued. components, was very feel month moving some out which and -- I pushed 'XX, out to standpoint, to where from AFFO the components you was and 'XX notes interest, like AFFO, and with, XXXX in that notes should out maturities pretty with were When they you're pushed what similar of to loan our the the we thinking about pleased an our a due that the March, we for of XXXX, the But XXXX, we of lot when in about I did will pushing AFFO, be are interest term and with this year. capital forward, maintenance

EBITDA the next growth into in going our AFFO year. think higher is we really as get drive to I our

Scott Wells

I I trying to one bridging about Yes. in numbers that And opening my ad to had Cameron, market. from. you off don't sorry, bridge general the what I'm left asked that I'm know

think of ad broad-based, entertainment is pretty verticals number terms market, picking of up, doing it that just So retail, characterize a well space. in and amusements, of In is I services, market number media local business national, strong as the up. remains a in really the I'd picking really

activity that lot orders.I in I of the of number is direction. set have a significant of market, care has I pharma, together been think hasn't care, which space, lot come care regional are to conversations, but so a far. broader and broader think the see year, insurance but health -- a so of think up cross tech auto kind health this aside great. health lot partly national, There of not local, no partly there had the a in is things that moving hoped We more right been picking

So of it's year the here and overexcited I on. goes a about relative on it mixed the to the in down QX fairway incremental business mean we're middle bringing get not market. trying trying the characterize as to focus and performance

that's best that helps. snapshot Hopefully, So think give at I the I you point. kind can of this

Operator

is Daniel from Osley line next Wells the of question with Fargo. Our

Unknown Analyst

So impressed across takes Were we that site the also you but of are with to timing-related margins there build-out, factors the year losses? raise. quarter, in surprised impacted puts strength the impact bit full flow any and that and the some a segments EBITDA were negotiation can between help didn't through us margin contract generally we sales lease the quarter? And to

Scott Wells

in hit going pretty we Why have and to in. have I visibility where then on we do is margins. some annual I'll good of part add guidance, this on come When don't to Dave our detail the QX of

degree percentages pretty airports, in favor gaudy number us. I annual QX intrigued us can in the Europe that in against This so here in worked is a of to and airports, worked also year, with it I'm think in such of And year, always mean, small that -- that pretty international of a us. particularly and the is in favor the just get I part core particular, issue worked quickly. Last

year.I of needing where to was you we talk to there the know, full So so takes going as this want what had up our sat good side the guess I Dave, This where visibility pretty don't at and guided to is part -- and puts particularly surprising when we we look was at QX the point. I'd to wasn't guide if the not be a about question. sense of from tell you we on

David Sailer

revenue our guide it's in mentioned, I were within about EBITDA But when of each segments. a the from Yes, in absolutely. And smaller Scott our we guidance QX. is think as QX, standpoint, a amount

QX going I of you to on opposed as a margins for of of the credit a quarter of I'd a If strong. didn't in is last the and favorability, this bad X%, unpack or of have going first quarter is first first America And collections we year in in were had obviously debt QX. bigger roughly the say that had the impact expenses the loss. That's year kind and couple one-timers each impact get if by when XXXX had it to are your So bit a up because of little the segment, through growth different. first we America, got flat there. it the very had quarter for driving XXXX. we tough And we we quarter were some what savings strongest. XXXX, probably very wasn't that of probably for increase.Airports -- up biggest of actually lease X% to We slimmer quarter first repeat is year continually We were had quarter. site we we're our COVID And And get XX%. to relief, in in first last way

have quarters the that because some. XXX% And you margins. have big to still that's we will about I slightly get airports think really elevated to We're fall going going be will COVID up, in XXXX, revenue because margins on incremental you XXXX come what a will impact So expect question know growth, when forward, similar sure but to this your not do when trickle in, in. relief to is going

growth. and the top quarter. line each So we higher get just about Norway. getting.And high-teens to to going first spoke gets earlier, the business always the But XX%. it's stronger. be Europe-North, you'll because very their maybe grow talk with year quarter they business, of EBITDA about in throughout up We They the grows, teens, in you're obviously higher smaller you're relief our airports is about in this had But contract the that good for lost revenue first of year, as $X million EBITDA quarter a XXXX, of to

have down numbers higher. line they So be goes driving that expenses because definitely lease top growth. your what's their margin and really it's little roughly impact, the especially when bit to flat That's site a small, and are are going

Operator

JPMorgan. Our Steiner line Avi of the is question next with from

Avi Steiner

the Scott, think, the may One, and I've strikes kind as on the some you -- got about and particularly kind and think second touched impact category given the just and to how and couple here. year move we media this, we a of of curious markets entertainment but more. couple a other of I you're in, of you have lap then the And had I some half issues.

Scott Wells

doing the that There's mean entertainment in going slowed obviously now. think QX. I the lot softness word? was 'XX. perform. streaming so builds, in was of as a okay I That in a And was -- It had you think us and think strikes, QX, particularly I hearing and and not strong have been off there, the great of of on media but before or it down see Yes. of right lot quarter. but point not I that don't high what's of media that comps suggests we're -- QX going entertainment wars -- just it in That we're is It nothing that it -- a right continue to time. was to a kind

through entertainment going schedule, looks part the like to not and that be as vibrant be the pretty strikes without as era. in, with movie a But it's going should So the of release it solid media year. good

companies of and products and parts television idiosyncratic, streaming kind that are company of and the book these more company content it you to have. each get of of little a by think I have the

be I it it. I'd growth would this characterize a have that. to within That how line, will going think year, be top takes category you're so and for Avi. puts And us But

Avi Steiner

be the puts And opening some there. And about if process to backdrop that how those on curious then And buoyancy well be and just there, just even about how all, might in more. quite takes, [indiscernible] the Europe-North, through I at comments performing you're think it you going impacting some I'm have one then and with seems assets?

Scott Wells

Yes. If I mean would in dialogue. the near-term up every assets of I sort factor the performance short-term the go performance think look us direct up. perceived that the not It makes things goes how time being anything, value a supports at it I to or out.

a is into become that factor a that's play. business. real our so intention we've clear And been comes that to But U.S.-focused

all, from negotiations any in detail changed into with in anyone you're past, script that's your are asked in extrapolating little point. I'm and getting. to it said hasn't on that question opening one, intention on in well, else times bit, in me not this buyer to performing as comments, wants a any the that that.And going at I'm it's is a that fact at ask we Avi, more go the on the progressing. our case And the process But things So way, I you've what

the we through I going think it, strong but viewpoint like answer change to what supports the our it's should performance downstream. or on that as work portfolio look not

Operator

Lance Vitanza Cowen. Next the TB with questions from of line

Lance Vitanza

detail? your that one was The mean, impact you just does Norway in other? contract importantly, loss curious the that away, us did you way the I I Norway more bit contract Had the this it what little or you? called prepared asset it ability let you who maybe sell a then going loss ultimately most lose go been this give was know you to? And could but contract I'm to the disappointing for or a Did profitable? out just remarks, is contract, this

Scott Wells

going I'm Justin particular ask to to opine contract. So that on Norway on

Justin Cochrane

Scott. Thanks, sure. Yes,

So this was a around the transit Oslo Metro. contract centered

us, JCDecaux. business. with. worthwhile contract it. big margin. So continue to relatively by only a then was B it that move bid always relatively onto The willing We level low level the a Plan the won it contract, very to And doing the for to public bid bid and the in the the you're contract. We It's we contract make win to to which didn't grow tender. case We for it were we you're lost happy was to willing our

a said, I contract. like it was lower-margin So

those replace plans higher-margin are smaller, contracts and with it plans to well. going have We

Lance Vitanza

quite sit could you what distinguish May, Is you it a any has And a is XX% then, between Valley, talked likely Scott, about And here Silicon of as been what back? Is the also in particular we back and Bay in bit you the XX% been saw advertisers I additional there has recovering? your Or think, region? late, as how that it but spot then Hollywood, if but for if soft you're first seeing and Area change. far today business quarter in back?

Scott Wells

really latter you 'XX boom And San in you Francisco kind and right enormous in tech, still came and a in. to And in through the vertical been but think very started that advertisers I very initiatives boomed been ballot me it's little to weigh the Bay back its growing out an it -- of not they mix the working our actually furniture up.I we anywhere and back while Yes. important market. the hardest, bit of it's number nicely kind some a leaving the late mean want the But tell really 'XX, the from for think really cleaned little you a until main Valley I things retailers Francisco Silicon the moving percent assets narrative dynamic, And would and there's it are increasing a talk strong get whole a and is that in is 'XX I history, softness. are out -- in Marina 'XX. I came it Area, the came neighborhoods national up city back near that interesting Francisco San do, done -- its and characterize been footprint well. lot the media streets actual to downtown San it about a because homelessness back, because when over number a particular, in city, a of about national it's and if that in it's definitely which always is percentage well, including Oakland and be having going is Hollow, came it's it the Valley or early shop those where back incredibly right like potential Noe about actually but mean various They as that really, tell the like neighborhoods of there hit street of has lawlessness it some the busted it's assets full streets you have to of have all back in there. are and I'd now, where has back that And advertisers hard to to throughout softness perceived and decide surrounds. I think city. doing when the all part or from part of into lifting mean And really positivity and San coming Cow since you and are way that neighborhoods.The city and bust a into in Francisco doing it that have then and then, passing, and into 'XX we're in until policing been things seeing of it a of hard that then like direction. COVID,

Although of a I tell go every was better it to ago. year, you Francisco considerably and it is couple San years times than now I'd X

I So has And is in line. that of being stepped there. covering I we feel see really feel team, San advertisers good ahead our think good local things Francisco. those and vibrant on. challenge not I The as for particular, good about for taking the national the up our on is city trend team,

Operator

Bank. line Deutsche next as with of Our from Aaron Watts question the

Aaron Watts

ad-supported One business the I'm video ad at providing you offerings, all view potential see obviously Do good U.S.? more in the here the follow-up national inventory. as on in quarter. Scott, headwind introduction performance, your targeted was the for that your curious, recent a on quite streaming which of several

Scott Wells

don't don't so is I I TV, is of part to an they're because so. threat struggling. linear I And think enormous TV and linear why think think

as have they what I linear is might in the participating of advertisers of might TV much might otherwise. they us think out prevent do transition as we

But regard, is particular of guess bit challenge. a that think it in a a that I don't us. overall, they're to I threat So

it's TV they of think linear true Europe. LATAM, the that the rest true in just I real frustrations speak one of U.S., the in world, and in it's in because the to, transition it's

is as money in international markets here, markets going much the TV it's not and coming We are much We're seeing onto of magnitude the but it in are here. degree to linear lot that a a seeing brands. we international same some seeing of higher.And out it our of assets

just that in brands it's gravitate more the And than interesting to markets the out-of-home U.S. so other

is is is it many to use of at assets we for little like sale. the analytically, of they a to cases. Some furniture the what the But that's when furniture it similar the closer of roadside look point of street do impact impact street

the of little U.S., TV doesn't dynamic. here a more linear it's in us come to a that's that of but So that bit head-scratcher money the

in So signs. businesses some our threat I it ways, a it's these are because ad-served opportunity huge they is, think on don't an and promoting

So there's opportunity in there, too.

Aaron Watts

out could one ask the all just to the last work capital around I you've you've If highlighted question structure, extend done maturities.

a runway the next clear got for couple You've of years.

rate environment, should near-term current the over that deleveraging thinking any the business in pause accelerate horizon process? other that from relatedly, growth a be aside front now? on the you Given about do take And we the levers to then

David Sailer

standpoint. acquisitions. and there. go market, XX have the or look, runway EBITDA business forward the economics some I an it the as we we'll out went is that going proceeds either March, standpoint in XXXX, market. to -- out maturities, notes in in proceeds be Europe have obviously, and Scott overseas the business. in since there's -- CapEx of will in monitor Europe you're the is to as those it, March, lower BV be And mentioned come out on of thinking the term will at process pushed grow saying, honestly monitor debt, that obviously the but to compelling.When reinvest maturities that opportunity you're month rates yes, to as we to kind But our time, what we always pleased cost XXXX very we about tied months loan think BV that running as into BV which us deleveraging, of there, notes the gone of through out, really remaining we're and not that obviously gives our go from obviously the to in have pushing was look, point opportunity process the successful or through Where our earlier. proceeds From we're then an went it would be look what we today. the can opportunity really obviously And to we'll the with we those saw the If extremely pushing that and have we're to But XXXX, from

I there'll it. be to options So a point that at time in kind take think look at of

Scott Wells

pretty Europe we've to part kind our what on divestitures been a the think couple last I years. structuring for the of focused I think that lot creativity for, question And the deal on international to your and and Yes. of had look clear of of other of we've

work as successfully that ourselves to we'll position we've on to the become be And And energy this those we we've come our that to that that aware, on way we broad. will working not what expending creative think on do been creative that able energy that do thing been should as the our I and available might and structuring lot things working U.S. in things is is processes, could way. the direct our sector that here the to just business, is I'm going deploy something very to U.S. variety a simplify the ideas But ability the be, you capacity because As of And good. you of expect divestitures you we well through for clarify as in of to are creative a interest there's us in lot different downstream.

Operator

next with Our Karnovsky the line from comes David of question JPMorgan.

Unknown Analyst

for All right. have X I Ted is This David. questions. on

The XXXX the first guide. is AFFO on

ask about flowing of there the anything keeping the through EBITDA year to that? Is primarily to relative and there revenue or full incremental the QX that Just is wanted source from in same. to upside the

David Sailer

mostly through calculation. From differences from there. the minimal an from and XXXX. flows projections and It's an nothing overall any really paid which last was some international really are that No, major our deferred which standpoint just year, our around we tax U.S., cash a local see I in don't our There the state. us our kind estimates. what in for focused standpoint, of to refining major taxes, there's tax year cash and adjustment for asset,

Unknown Analyst

And then to wanted programmatic. ask I on

moving source the for quarter forward. about ask of strength and to wanted the expectations Just

Operator

Ladies stand We're and difficulties. technical gentlemen, please experiencing by.

momentarily. Our continue resume with questions. conference your will Please

Scott Wells

Ted, a we're as line, or sure something question. you knocked power had little but back. lost starting second you surge were sorry, I'm our -- we not out us we off your

Unknown Analyst

your The for the of and question was strength source are about QX basically programmatic for that expectations the programmatic what and the rest of year?

Scott Wells

a programmatic October since accounts actually last now right variety of one growth September, of pretty kind behind So ramping year. been programmatic of there's And is has coming off well least it. drivers of the At business. direct

something so seen we that's broadly. haven't And

your little in of of that is means trading bit out-of-home X omnichannel broader is is Desk left there think Trade so their of And that the out-of-home, the platform. right out-of-home.And thing pocket, I DSPs digital -- But pocket in is mainstream it's is mainstreaming biggest and are DVXXX a into on. the out had the process what and of that base coming offering going that out-of-home part you've the what's

a part of at think success, really way, to had, in that And are so I we get bringing some what's number consideration new the addition outreach that There that's clients. to we've good on and going partners least to category. of advertisers

quarters of year. of and growth been it's for don't So it's think expect I in just will rate I it's growth that as be whole it been high rate. the stay as double-digit the won't a be will couple do variety as QX behind factors QX. It it. as a But we think high last the

Operator

of Research. Goss with is line Barrington from the Jim question Final

James Goss

is immediate, advertising movie going very The be obviously. to

small and of screen big to out be you screen drag 'XX current also of flow, in what a lot for year? is a I'm but over of CinemaCon, of and terms the coming film your for of And enthusiasm big do of next very wondering tough next the couple with a there's markets. return Just think how 'XX that versus can quarters. environment importance your optimism mix

but mostly it's screen, think a otherwise. I me tell big

Scott Wells

Yes. absolutely right. No, you're

screen, that's not -- prevalent oriented. big part more mix. our We We screen are the get not some of but small

the release But of disputing characterization 'XX. I little your -- as we a I'm what 'XX hear. be will -- maybe as think is not that than not good darker that I schedule

our So think multi-quarter not an part category for that I us. of can book. do this something It's that be is enormous a positive

it's would if that I I break but built we that 'XX ways other find audiences with we're a are political one.But out year on coming So into the overflow political that don't would breaks lot their to that, ad goes crack where are we working a see 'XX the make are in of we think be to direct be. the in to that But how ton guide, direct us our we crowded people with can political, in to upside characterize going getting us actually or has to have want although that or or hard in don't space of the sports get so that they're reach it don't as TV with 'XX going for political what political, fatigued a year of XXth a row that watching. on very

of growth again, that is welcome look, help can or for year. the should our going political make to a think your XXXX. this we going build business. how offset I driver next optimism release some that movies to share So But be it's year schedule And comp not and break we that in into

James Goss

volume terms and Airport what vary if impactful important you business side? personal versus bit. briefly, talk might the probably got little either think it of in touch might drivers quite bit revenue the And should are you in of on think I'd wonder teens I the terms general, about to going travelers, the other be and if affect high but said like you travel of expense The can you business side a in to trends, a I that's area margin the how straight, be

Scott Wells

So then the the we let Dave few expense revenue have how in side. I'll changed really let last on dig and the side, over on years. start me sell We airports

different doing tunnels of experiences, between that assets over terminals. have We on airports. other that's focused number more like or compelling particularly We've become taking in for are that done creating advertisers, on-site a experiences sampling whether

roadside something kind I'm in of been so monetizing the the that some that of see only thinking playing those driver, was New to big you've what last better we're team out of And assets building seen progression assets. that's I of York XX experiments challenging the apply out.But getting us starting And our driver. the some lines and a of along kind to those the has months just think that part to same at so

terminals New projects is be on largely renovation the LaGuardia, York because built, LaGuardia there. terminals still although will finish, going there of of meaningful finished, JFK the as some there's some

of back think the really bought of the step to advertisers going in still be we we gives been inevitably should we're until has attractive come there in, big some of point the a assets -- business who into back been on terms close and that big more getting for that had pleasure as at had that were are which We've get the done where where just big that that demographics of nothing way, At strategic back back. about travelers some in you're back top tailwind airports nice business the consistently. direct trying that in much travelers, certain a have is where was we on.And reach, even extensions. of we've that that actual as job juice and will the in that more we There's going nice pre-pandemic, we they now step And to one it can for that's airports will. people footprint. travel that take right next comes is different nature represented deploy idea think you cherry airports, a And a expansion to decision-making. we in some contract, when So very be business really will a traveler gotten airports the headwind.I business travel doing the within of in we be that's to because if what's have like and lose getting will has people point, and front a of fortune headed and But business. we see we good uplifts us, us pretty

assets, continuing target. our of and But are drivers, And ongoing of the come so super different selling, story, attractive continuing premium been a revenue traveler of part to too. to the digital big the sort and back that's those be expansion

Scott Wells

Dave, you want to talk to expenses?

David Sailer

when growth several simpler to I had have lease, drivers we than the percent our for of lower quarters. the Sure. in think The higher standpoint. when say, the about you Obviously, -- revenue into it's from lease, their that the over Airports been larger expense slightly fantastic assets would airport the Expenses, a lot are -- a airports. rent. some of airports a our site lower. biggest But we've revenue from pay is expense is that rent, smaller the authorities the of business, most contracts And or standpoint, you airports percent a going -- last site seeing an definitely what there's we

performing from to well is mix helping I also going what we're a a that airports actually a fixed it's margins be. really has component -- a all of are So standpoint.And margin your factors, big right are revenue have now, mag. which really across we those your And few mean,

quarter. have we if are then I'll we're relief that factors go But drive to extent in back going right that you that, bottom an So you the had continually were 'XX. to that to XXXX standpoint. going we line. of But are the get as down We driving than X that's going that really getting a expense what and from to are lesser we're it that's experienced that seeing. those the the definitely expansion And throughout first grows, to in above margin main revenue and to revenue drop

Operator

At turn this for closing back comments. floor to time, Scott I'd the like to

Scott Wells

our to Rob, all of little you, thank for questioners Thank and technical glitch putting and up our there. Great. you with

many all that appreciate coming look in We of about forward We brief Take seeing care. and for the or Sorry feel your in you good year weeks. silence. attention. of you the events to window upcoming

Operator

Thank you. This will conclude today's conference.

you wonderful your disconnect for and participation, at time. your have lines day. may a You thank We this

Clear Channel Outdoor (CCO) 9 May 242024 Q1 Earnings call transcript