oOh!media (OML) H1 2024 earnings summary

Executive summary

• Out-of-home advertising sector reached a record 15% share of all media, remaining the fastest-growing media segment in Australia and New Zealand, with oOh!media maintaining its leading position despite a 2.8–3% revenue decline in H1 2024 due to contract exits and restructuring.

• Management focused on cost discipline, contract renewal, and accelerating digital asset rollout, with strategic investments and new contract wins expected to deliver over AUD 38 million in incremental annualised revenue from 2025 onwards.

• Margin expansion was achieved through disciplined contract bidding and cost control, with adjusted gross margin improving to 43.1% (up 1.8ppts year-over-year).

• Interim dividend of AUD 0.0175 per share declared, fully franked and consistent with prior year.

• Out-of-home sector outperformed broader media, with oOh!media underperforming peers but seeing signs of improvement in Q3.

Financial highlights

• Revenue for H1 2024 was AUD 288.3 million, down 2.8–3% year-over-year, mainly due to the exit of the Vicinity retail contract and contract structure changes reducing non-media revenues.

• Adjusted gross profit was AUD 124.3 million (up 1%), and adjusted gross margin improved by 1.8ppts to 43.1%.

• Underlying EBITDA was AUD 48.6 million (down 2%), and adjusted underlying NPAT was AUD 18.2 million (down 7–11%).

• Interim dividend held steady at AUD 0.0175 per share, fully franked.

• Gearing increased to 0.97x as of June 2024, reflecting capex and working capital investment.

Outlook and guidance

• Revenue outlook improving into Q3 and Q4, with blended Q3 growth of 2% and further strengthening expected.

• Adjusted gross margin for CY2024 expected to be in line with prior year; opex growth to remain at or below inflation.

• CapEx guidance maintained at AUD 45–55 million for FY 2024, mainly for new advertising assets.

• Gearing expected to decline in H2 as working capital unwinds and new revenues come online.

• New contract wins and digital asset rollouts anticipated to drive growth from 2025 onwards, with a pipeline including AUD 38 million projected incremental revenue.