- Earnings call transcript Q3 2022

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Operator

Hello and welcome to the OUTFRONT Q3 2022 Earnings Call. My name is Josh and I will be your coordinator for today’s event. [Operator Instructions] I would now hand you over to your host, Stephan Bisson to begin. Thank you.

Stephan Bisson

Good afternoon, and thank you for joining our 2022 third quarter earnings call. call and Jeremy President Matthew Financial the Chief Chairman and on Officer. Officer; Executive Siegel, me today Male, are and Chief With Executive Vice up results, discussion open our a question-and-answer financial After the of lines for a session. we'll

conference statements. that the outfrontmedia.com. to from refer September in our presentation can XXXX factors tomorrow. has may file will a earnings listed can Relevant After our call to the cause today's and expect Our in and and section Relations be differ these in you release XX, as actual replay to XXXX call today materially the our materials earnings available well. are including XX-K, results forward-looking SEC Form filings, comments forward-looking of find Investor XX-Q, statements Form will slide that our we This there include our website, which concluded,

on OIBDA slide an website, period We Reconciliations measures includes financial earnings to also Any other non-GAAP the the measures non-GAAP are on on and release prior be the call. which presentations will financial in to reconciliations. will appendix certain adjusted OIBDA with today and of this references presentation, of refer our basis. made

the to call Let me now turn Jeremy. over

Jeremy Male

everyone Thanks Stephan. And today. you us for thank joining

demand transit our pleased the further recovery with guidance see during total another XX%, sharing on Starting are improvement to AFFO double in We in quarter. Labor consolidated return and Slide revenue buses year-over-year an million another acquisition as post million pushing to and and to X, Portland. the robust, comfortably including $XX and revenue in our Day. $X rails be nearly This months riders with to quarterly be yields in growth a line our the to OIBDA we numbers in Advertiser grew third headline reporting improvement digit ago. numbers that led results quarter continues you'll greater here in driving strong record three growth quarter billboard of provided

with achieve wishing Speaking we we the in of without to AFFO, year. trends the and believe the Matt, seeing QX, on to your we're for we're track right XX% growth best this to guided result lines, steal in

Transit prior we provide XX% needless our XX% retail. New year, in which revenues Miami business fourth to steady X. U.S. increases. a X, on but versus should local the good towards U.S. and continuing XX% mostly is Slide our of I'll call to like usual, Slide and our with of U.S. striking. more say, it's in XX% all was rail the but feel from be Slide Media see the returning business segment as Nearly was later, total our quarter auto, XXXX and detail. up bus As coming ridership improvement place. you being year-over-year. consists entertainment, every and The revenues in increasing technology continues X shows Canada, results to in its national on detail up Media versus subway, prior levels performances seen year. can as with can breakdown year-over-year York with regions strong grew category over more strength significant out particularly Other, Billboard up in billboard On revenue

U.S. returns of billboard and year-over-year split national XX% historic X%. growth, to both was continue compared our quarter local healthy This to year-over-year XX% grew the again we locals business, local. $X,XXX. us Slide growth XX% of ahead X our to While yield to which see national strength just this in shows parts XX% up over of

our continues and in digital part for robust X yields digital performance rates, markets. driven and by of in three our high a XX% yield premium highlights small from our to representing major growth the rate reflecting, of but trend main Slide year. has programmatic, in advertiser demand increased the been growing particularly growth driven our improved growing nearly As quarter throughout our by up strong principally early continued year inventory, total with the steps XX% remains revenue This factors, additional last convert resulting boards to be which revenue inventory XX% from as we business. was

New you digital As million. where installed of we transit York an during in can around XXX transit XX% be contract to healthy displays our digital revenues renewing driver installed QX, since displays grew XX% increasing $XX digital advertising XXXX. grew continues see, our X,XXX over total largest billboard and a The digital to outsize the our to MTA,

hand the review Let financials. it our of to me now rest over to Matt

Matthew Siegel

Thanks appreciate turn to joining you detailed Slide expenses at today. our were Jeremy. $XX Please XX% good million our more And for or year-over-year. expenses. call afternoon up X Total everyone. look We

on our to for increased combined agreements. higher for reflect XX% related expense lease This strong expense was grew basis higher nearly up and points higher As margin XX billboard that and last our billboards OIBDA a in year points XX%, U.S. were provided in impact increases by this was increases maintenance OIBDA by from performance-related basis are again was our in New largely year. entertainment serve we essentially usually unfunded that operating and growth and expenses in Billboard significant in nature year. up driving increased for of and leverage digital maintenance reflects deferral the revenue which the for higher our The $XX detail first declined versus lower affecting inflation operations year Posting, primarily of costs, and are expand XX% to due as our increasing to retirement also relatively the XXXX flat SG&A locations our XX, driven versus performance-based offset increased payments. MAG case Corporate was guarantee forward plan. growth a last and revenue, was up additional Transit York revenue is of travel an favorable expenses. the higher margins OIBDA. index-linked due On our the expense revenue partially from but given franchise Transit and last increases million expense fluctuations versus activity is to relatively which on new our markets. given XX million the located but additional a Slide particularly These items XXXX. OIBDA Jeremy York, remain OIBDA owed versus versus high Miami, from our was XX comparability the breakeven our revenue markets will equity compensation compensation QX, other earlier. other and cost in our XX% up major growth year. basis variable Slide OIBDA share at the select increased provides revenue, reflecting MTA increase sales move of and contain in remained quarter doubtful leases portion was mentioned minimum other revenue spend. represents and and the and New margin We costs, confident revenues, billboard employees the of see as that we accounts New margin boards fixed and down XXX XXXX but growth an year-over-year share X% also by the billboard discretionary sources offset one-time by and provision $XXX of additional up that the in results to margin Los annual MTA, cities and points up Angeles, costs. in that including revenues. also proportion York and you higher primarily led is and outperformance some XX% can on our market XX%, variable half ago, expense These of year the has

MTA account when As minimum New expect basis a a franchise annual the line year. we straight guarantee, paying throughout be expense the reminder, on the for we York to

we expect in to XXXX seasonal in revenue see this, strong to we did quarter. XXXX as OIBDA peak fourth Given a the due reported in QX benefit to

The capital over digital of to spend million up XXXX, or maintenance conversions, to spend. have XX% versus expenditures through increased versus developments, XXXX due $X increase QX primarily count QX we Turning was Slide to million total million Year-to-date, new on prior in management acquisitions $XX CapEx XXX year digital was CapEx the agreements. XX, billboard total $X our including investments. and

below you Slide QX OIBDA growth, see can other $XX AFFO the by items. $X cash by and line our at CapEx, maintenance XX, improve on as year-over-year AFO of the offset higher million which Looking interest our million partially

million available our including mentioned receivable million million accounts earlier, in AFFO. Please we our guidance updated our available and securitization to As revolver $XX an for liquidity remain is via in balance Jeremy almost XX approximately full of of cash, sheet. $XXX Committed over year million, start program. growth Slide XX% on $XXX $XXX via confident our

our As We of with our mid-XXXX very to rates. of comfortable and September being next debt less floating total until not XXth our remain times. leverage XX% X.X than net with total debt was subject maturity stack

$XX it December year the facility We Board record acquisitions and hand on $X.XX Directors acquisitive more will at a since on By the of close as deals draws securitization the XXXX. expect shareholders to our has to today our of funding completed in on necessary. announced tuck-ins we these ends, this our XXXX payable a that year dividend few Xnd. declared cash our and million XXth with Lastly, be cash business on December close of quarter of most time

all pipeline, for let deal activity of closing, QX the quarter solid back in our remain our With Jeremy. XXXX. around the expect was in the year. turn Looking business current acquisition confident me to a and we at In our moderate we that call to remainder

Jeremy Male

Thanks Matt.

revised been digit total are X% While their forecast estimate advertising, will in and looking business be category, the to fact, the which to all and market. good We full MAGNA's markets as our expected cautiousness of Magna by this the at Based seeing geographically science, the We are it second mediums, good in for forecast. positive that as similar XXXX year another media healthy to at much for revenue transit the currently That We forecasting September our we simply at within this. a ad report And expect X% when and QX in that was quarter. XXXX currently all next front to that to in total pie significant an our math growing rates. forecasts advertising today QX out-of-home and and see is expected XXXX, understand of year. fronts. In largest MAGNA in their for outdoor suggests we're growing will there to well. regarding strength out this of not with advertising has recently expect out-of-home out-of-home total the obviously other medium financial together in is and not is grow is understand we second U.S. revenues growing strength confident that vacuum, and advertiser out-of-home ad broad-based directionally despite billboard reducing half putting are the exact both on there increased we update we additional grow mid- in potential total expects remain the volatility will in and seen reasons for believe not remains It both we'll trends take share the of but we have some we the advertising compared is and but high-single reflected be seeing business. interesting continues this written range in on

among conversions, First digital are and creative advertisements out, unprecedented investments advertisers. the on visual creating spectacular flexibility digital transit for with our innovation that focus digital excitement build allow all new in

audience and solutions measurement provides audience targeting to of a attribution campaigns the metrics and Second connect variety data our through KPIs. capabilities

hard for both line as line whole, of go And and by automated homes in in and their mass they buying enable small of worked outdoors frequency of fraud proposition free programmatic outside engage cost frictionless while but We've initiatives inclusion meeting campaigns. value are and fourth, world platforms consumers reach, these being efficiency And lines as pleased Third, brand further We on real high is activities. growing we're question and more other on Choe to you as from omnichannel bolstered a and a it much. out Morgan. front that Please questions. do industry Instructions] at pain dividends that the see very the comes the but Thank Richard let's with operator, and have ahead. from JP work now an [Operator today. also open safe,

Richard Choe

it different driving there's local Great. the or and I'd a follow-up maybe for the XQ to growth fourth the and Transit, if like two that's for quarter? on Billboard guidance kind and the there what's more national drivers is of segments strength in contributing advertising

Jeremy Male

fashion into pacing auto strong the as for appetite Look guidance growth of increasing – currently QX, generally because saw for a it's categories forward, is throughout on If And right the that markets in so and the our QX question, versus great. part relative as sort QX. for QX broad-based basis board much up the time, it and all we're a transit growth it we seeing and as in is medical up at obviously have XX% about and implies if go for point accelerating across for strong, of is into travelers XX% same we sort this retail, year, of it's the growth of most across in Rich. Thanks think and certainly which the the kind but XXXX, improve of actually is dig some of only you we look so positivity. categories, interesting a we

So to where that's good we our again really feel and good very is see now. about right business

Richard Choe

And just growth your is accelerating space and take ad your the it up that's that to drive price to follow billboard helping on ability seems that? like there, premium side,

Jeremy Male

had and majority in be we've QX. that the obviously great to Look, case as the right of growth know continues from about and implies mentioned advertisers. way year the that demand absolutely. yield strong some increasing Yes, And is which a rates, through the you

Richard Choe

Thank Great. you.

Operator

the line. Aaron got Thank from line Watts comes looks go ahead. you have Bank. the Deutsche [Operator on much. Please of It question from Instructions] It very Okay. we another

Aaron Watts

are can Just deferral you much quantum over the from Matt, me that two me. left have questions of remind quick more do to make you for the how pandemic? payments on MAG

Matthew Siegel

Sure. $XX about from about XXXX, it's $XX.X deferred so We into million going milling, it's through $XX a XXXX year, so to million. XXXX

Aaron Watts

that ridership it. going trends And and you'll and your the MAG be is seeing that forward, the on reaction advertiser you're in based markets to it Okay. in Got expectation major some that of the your above performing XXXX levels?

Matthew Siegel

during year shifted you'll we'll the of did portion the in the be in our our think When employing. certainly sometime term see MAG. deployment, tomorrow see we the into XXXX some We you investment small queue MTA short above

We expect little start of a to XXXX. in bit recouping

Aaron Watts

got I the That's Okay, time it. great. appreciate

Matthew Siegel

sure, For thanks.

Operator

There further were no questions line. on the

to the you speakers. hand I'll over So back

Jeremy Male

with results today. see to that and for on Josh, conferences the joining at to for winter, then many the forward thanks you again. presenting and you everyone in of Thanks events to this various us I look call but February. our hope I and Thanks to meet QX those don’t; I

Operator

you Thank very joining call. much today's for

You disconnect may lines. your now

Outfront Media (OUT) 4 Nov 222022 Q3 Earnings call transcript