Outfront Media (OUT) Q3 2024 earnings summary

Executive summary

• Third quarter 2024 revenues were $451.9 million, down 0.6% year-over-year due to the sale of the Canadian business, but organic revenues grew 5% year-over-year.

• Net income attributable to OUTFRONT Media Inc. was $34.6 million, up over 100% compared to the same quarter last year.

• Adjusted OIBDA for U.S. Media rose just over 11% to $133.5 million, while consolidated AFFO increased nearly 7% to $80.8 million.

• A special dividend of $0.75 per share was declared, payable December 31, 2024, with a mix of cash and stock; a reverse stock split is planned for January 2025.

• The company completed the sale of its Canadian business in June 2024, receiving C$410 million in cash.

Financial highlights

• U.S. Media digital revenues grew 11.2% to $111.1 million for billboards and 8.3% to $36.6 million for transit and other.

• Billboard yield increased 6.9% year-over-year to $2,994 per average display per month.

• Total operating expenses decreased 2.8% year-over-year, mainly due to the Canadian business sale and lower property lease expenses.

• Net interest expense fell to $37.1 million from $40.2 million year-over-year, reflecting a lower debt balance.

• Net cash flow from operating activities for the nine months ended September 30, 2024, increased 17.1% to $174.7 million.

Outlook and guidance

• Q4 U.S. Media revenue growth expected around 3%, with billboard in low single digits and transit in high single digits.

• Full-year consolidated AFFO projected between $295 million and $300 million, with management expecting to achieve the high end of its growth target.

• Digital conversions for 2024 expected at 100-150, with a higher number anticipated in 2025.

• MTA equipment deployment costs are expected to be ~$50 million in 2024, declining to $30–40 million annually thereafter.

• No additional impairment charges are expected for the MTA asset group if current performance continues.