Outfront Media (OUT) Q3 2024 earnings summary

Executive summary

• Q3 2024 was the first period as a fully domestic company after the sale of the Canadian business in June, with consolidated revenue at $451.9–$452 million, down 0.6–1% year-over-year, but organic revenue grew 5% year-over-year.

• Net income attributable to the company was $34.6–$35 million, more than doubling year-over-year.

• U.S. Media revenues grew 5–5.3%, with digital and transit segments both contributing to growth.

• Adjusted OIBDA for U.S. Media rose 11–11.1% to $133–$134 million, and consolidated AFFO increased 6.7–7% to $80.8–$81 million.

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

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, with digital revenue accounting for 32.7% of segment total.

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

• U.S. Media OIBDA margin improved by 110 bps to 37.8%.

• Q3 U.S. Media CapEx was $17.6 million; full-year CapEx expected at $85 million.

• Net interest expense fell to $37.1 million from $40.2 million year-over-year.

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 2024 consolidated AFFO guidance is $295–$300 million, with management expecting to achieve the high end of the target.

• Digital conversions for 2024 expected at 100–150, with higher numbers 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.