Clear Channel Outdoor reports lower revenue due to weak sales results in the Americas
International business grows as company expands in emerging markets such as China and Latin America
SAN ANTONIO, Texas – April 24, 2014 — Clear Channel Outdoor Holdings, Inc. today reported financial results for the first quarter ended March 31, 2014.
“We made solid progress at our Outdoor businesses during the quarter, as we increasingly capitalized on the growing opportunity in international emerging markets while refocusing our Americas organization to meet the shifting needs of our advertising partners,” said Bob Pittman, Executive Chairman of Clear Channel Outdoor Holdings, Inc. “CEO William Eccleshare and his team are also driving our technological leadership, such as launching ‘Connect’ – a groundbreaking mobile advertising platform that will enable 175 million consumers monthly around the world to access information, shopping, entertainment and community with just their smartphones. We look forward to continuing to transform the out-of-home industry to engage more global consumers more deeply than ever with the industry’s most advanced innovations and smartest initiatives.”
“International Outdoor is showing continued strength with a 24% increase in OIBDAN compared to the prior year quarter,” said Chief Executive Officer William Eccleshare. “Strong performances in emerging markets, such as China and Latin America, have been augmented by the economic recovery in Europe. Our UK business is executing ahead of the market, and we see clear signs of an improved performance in the Eurozone, aided by our Sales Force Effectiveness and Revenue Management programs.”
“Americas Outdoor faced difficult conditions in the quarter,” Eccleshare added. “We continued to see growth in our strong local and regional business. But our national operations faced challenges, such as the continued absence of revenue from the 77 digital boards in Los Angeles and other divested assets. In addition, a number of our major advertisers shifted their out-of-home spending to support other initiatives, including the Winter Olympics and World Cup. We are taking steps to address these setbacks with our new national sales leadership, our Shopper Marketing program and the continued expansion of our digital footprint.”
First Quarter 2014 Results
Consolidated revenues decreased $15 million, or 2% year over year, to $635 million in the first quarter of 2014 compared to $650 million in the same period of 2013.
- Americas revenues decreased $18 million, or 6%, driven mainly by the absence of revenue from the 77 digital bulletins in Los Angeles that were turned off due to a court ruling, and lower revenues at airports due to contracts that were not renewed. Partially offsetting these declines was higher capacity and occupancy of digital bulletins in other markets.
- International revenues rose $3 million, or 1%. Revenue growth in emerging markets including China, as well as developed markets including the UK and France, was partly offset by declines in other countries, including those in Northern and Eastern Europe, primarily due to challenging macroeconomic conditions.
The Company’s OIBDAN1 was down 6%, or $6 million, to $92 million for the three months ended March 31, 2014, compared to $98 million for the same period of 2013. Included in the 2014 first quarter OIBDAN of $92 million were $2 million and $2 million of operating and corporate expenses, respectively, associated with the Company’s strategic revenue and efficiency initiatives to attract additional advertising dollars to its businesses and improve operating efficiencies. OIBDAN for the three months ended March 31, 2013 included $7 million of such operating expenses.
The Company’s consolidated EBITDA, as defined under the CCWH Senior Notes indenture, was $766 million for the three months ended March 31, 2014, down 2% compared to the same period of 2013.
The consolidated net loss attributable to the Company was $97 million in the first quarter of 2014 compared to a consolidated net loss attributable to the Company of $74 million in the same period of 2013.
The Company’s recent key highlights include:
- Installing 15 new digital billboards for an end of quarter total of 1,081 across 39 U.S. markets.
- Continuing to use advanced technology to transform itself, Clear Channel Outdoor launched “Connect,” the first out-of-home mobile interactive advertising platform that will initially reach 175 million consumers each month across 23 countries on five continents – the largest network of its kind. “Connect” turns advertising panels with NFC, QR and/or SMS capabilities at 75,000 of Clear Channel Outdoor’s pedestrian-accessible sites into mobile launch pads, enabling consumers to access interactive content from advertisers via their smartphones for information, shopping, entertainment and community.
- Announcing Clear Channel Airports’ agreement with Adlux, the private aviation advertising market leader in the Middle East, Europe, Russia, Asia-Pacific and Central America, to provide brands with one-stop-shop and sell-through access to multimedia advertising opportunities in the busiest private airport lounges in the world. This alliance extends both companies’ media networks into private airport terminals covered by the other in order to engage the exclusive audience of high net worth and senior executive business travelers.
- Partnering with Transport for London to test a real-time mapping tool at a bus stop along London’s heavily traveled Regent Street. The mapping tool features a digital screen showing passengers the real-time progress of their buses, travel updates from London Underground and tourist information for the surrounding neighborhood.
- Signing Vodafone to a three-year contract to become the exclusive sponsor of the Clear Channel smart bike sharing system in Barcelona – called “Bicing” – with Vodafone branding on the bikes, docking stations and website.