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OUTFRONT Media Reports Second Quarter 2019 Results

05 Aug 2019
Revenues of $459.9 million
Operating Income of $88.7 million; Net income of $50.3 million, $0.35 per diluted share
Adjusted OIBDA of $143.6 million
AFFO of $96.3 million
Quarterly dividend of $0.36 per share, payable September 27, 2019

NEW YORK, Aug. 5, 2019 /PRNewswire/ -- OUTFRONT Media Inc. (NYSE: OUT) today reported results for the quarter ended June 30, 2019.

OUTFRONT Media Logo. (PRNewsFoto/OUTFRONT Media Inc.)

"Our momentum continues with the fourth straight quarter of strong results - total revenues up 14.5%, Adjusted OIBDA up 14.7% and AFFO up 24.7%," said Jeremy Male, Chairman and Chief Executive Officer of OUTFRONT Media. "Exceptional performance was seen in both our billboard and transit business, including an impressive ramp in digital revenues.  We're enjoying the benefits of great sales execution across our unique assets, and the increasing attractiveness of out-of-home media to both local and national advertisers."



Three Months Ended
 June 30,


Six Months Ended
 June 30,

$ in Millions, except per share amounts


2019


2018


2019


2018

Revenues


$459.9


$401.7


$831.6


$739.6

Organic Revenues


459.9


400.9


831.6


738.1

Operating Income


88.7


32.9


125.6


64.6

Adjusted OIBDA


143.6


125.2


230.4


206.4

Net Income (loss)3


50.3


(5.2)


56.4


3.9

Earnings (loss) per share1,3


$0.35


($0.04)


$0.39


$0.02

Funds From Operations (FFO)


90.6


74.1


132.7


119.4

Adjusted FFO (AFFO)


96.3


77.2


135.5


115.3

Shares Outstanding2


142.9


139.2


142.0


139.3

Notes: See exhibits for reconciliations of non-GAAP financial measures; 1) Per share for diluted earnings per share; 2) Diluted

     Weighted-Average Shares Outstanding; 3) Includes $42.9 million goodwill impairment charge in the second quarter of 2018

Second Quarter 2019 Results

Consolidated
Reported revenues of $459.9 million increased $58.2 million, or 14.5%, for the second quarter of 2019 as compared to the same prior-year period.  On an organic basis, revenues of $459.9 million for the second quarter of 2019 increased 14.7%.

Reported billboard revenues of $305.8 million increased $25.4 million, or 9.1%, due to higher average revenue per display (yield) and the growth in revenues from digital billboard conversions, partially offset by the negative impact of foreign exchange rates. On an organic basis, billboard revenues increased 9.3% due to an increase in yield and the growth in revenues from digital billboard conversions.

Reported transit and other revenues of $154.1 million increased $32.8 million, or 27.0%, due primarily to an increase in yield, growth in revenues from digital displays and the net effect of won and lost franchises in the period.  On an organic basis, transit and other revenues increased 27.3% due primarily to an increase in yield, growth in revenues from digital displays and the net effect of won and lost franchises in the period.

Total Operating expenses of $240.3 million increased $28.3 million, or 13.3%, due primarily to higher transit franchise expenses due to higher transit revenues, the addition of our San Francisco Bay Area Rapid Transit ("BART") transit franchise agreement, higher billboard lease expense and higher posting, maintenance and other expenses.  Selling, General and Administrative expenses ("SG&A") of $81.5 million increased $11.4 million, or 16.3%, due primarily to higher compensation and other employee-related costs and higher professional fees.

Adjusted OIBDA of $143.6 million increased $18.4 million, or 14.7%.

Segment Results

U.S. Media
Reported and organic revenues of $419.6 million increased $52.4 million, or 14.3%, due primarily to an increase in yield and growth in revenues from digital billboard and digital transit displays. Billboard revenues increased 8.6% due to an increase in yield and growth in revenues from digital billboard conversions.  Transit and other revenues increased 28.5% due primarily to an increase in yield, growth in revenues from digital displays and the net effect of won and lost franchises in the period.

Operating expenses increased $28.0 million, or 14.8%, due primarily to higher transit franchise expenses due to higher transit revenues, the addition of our BART transit franchise agreement and higher billboard property lease costs. SG&A expenses increased $9.8 million, or 21.0%, due primarily to higher compensation and other employee-related costs and higher professional fees.

Adjusted OIBDA of $145.8 million increased $14.6 million, or 11.1%.

Other
Reported revenues of $40.3 million increased $5.8 million, or 16.8%, due to improved performance in Canada and our Sports Marketing operating segment. On an organic basis, revenues increased $6.6 million, or 19.6%, excluding $0.8 million in unfavorable foreign currency exchange rates.

Operating expenses increased $0.3 million, or 1.3%, driven by higher expenses in our Sports Marketing operating segment.  SG&A expenses increased $0.9 million, or 11.8%, driven primarily by higher expenses related to Canada and our Sports Marketing operating segment.

Adjusted OIBDA of $8.8 million increased $4.6 million, or 109.5%.

Corporate
Corporate costs, excluding stock-based compensation, increased $0.8 million, or 7.8%, to $11.0 million, due primarily to higher compensation-related expenses.

Interest Expense
Net Interest expense in the second quarter of 2019 was $33.9 million, including amortization of deferred financing costs of $1.6 million, as compared to $31.0 million in the same prior-year period, including amortization of deferred financing costs of $1.4 million. The increase was due primarily to a higher weighted average cost of debt at June 30, 2019 of 5.2% compared to 5.0% at June 30, 2018, and a higher outstanding debt balance.

Income Taxes
The provision for income taxes was $6.2 million in the second quarter of 2019 compared to $8.1 million in the same prior-year period.  Cash paid for income taxes in the six months ended June 30, 2019 was $5.3 million.

Net Income
Net income was $50.3 million in the second quarter of 2019 as compared to a net loss of $5.2 million in the same prior-year period. Diluted weighted average shares outstanding were 142.9 million for the second quarter of 2019 and 139.2 million for the same prior-year period. Net income per common share for diluted earnings per weighted average share was $0.35 for the second quarter of 2019 as compared to net loss per common share for diluted earnings per weighted average share of $0.04 in the same prior-year period.

FFO & AFFO
FFO was $90.6 million in the second quarter of 2019, an increase of $16.5 million, or 22.3%, from the same prior-year period, driven primarily by higher net income, partially offset by an impairment charge recorded in 2018.  AFFO was $96.3 million in the second quarter of 2019, an increase of $19.1 million, or 24.7%, compared to the same prior-year period, due primarily to higher operating income, partially offset by higher interest expense and higher cash paid for direct lease acquisition costs.

Cash Flow & Capital Expenditures
Net cash flow provided by operating activities of $83.5 million for the six months ended June 30, 2019 increased $15.3 million, or 22.4%, compared to $68.2 million during the same prior-year period, due primarily to higher net income as adjusted for non-cash items, partially offset by higher prepaid equipment deployment costs relating to the New York Metropolitan Transportation Authority ("MTA") transit franchise agreement.  Total capital expenditures decreased $6.8 million, or 14.7%, to $39.6 million for the six months ended June 30, 2019, compared to the same prior year period.

Dividends
In the six months ended June 30, 2019, we paid cash dividends of $103.9 million.  We announced on July 25, 2019 that our board of directors has approved a quarterly cash dividend on our common stock of $0.36 per share payable on September 27, 2019, to shareholders of record at the close of business on September 6, 2019.

Balance Sheet and Liquidity
As of June 30, 2019, our liquidity position included unrestricted cash of $474.8 million, $364.0 million of availability under our $430.0 million revolving credit facility, net of $66.0 million of issued letters of credit against the letter of credit facility sublimit under the revolving credit facility, and $175.0 million of aggregate borrowing capacity remaining on the accounts receivable securitization facility and repurchase facility.  During the three months ended June 30, 2019, we issued $650.0 million aggregate principal amount of 5.000% Senior Unsecured Notes due 2027.  During the three months ended June 30, 2019, we received gross proceeds of $35.0 million related to the sale of 1,400,000 shares of our common stock under our at-the-market equity offering program, of which $232.5 million remains available.  Total indebtedness as of June 30, 2019 was $2.8 billion, excluding $24.4 million of debt issuance costs, and includes a $670.0 million term loan and $2.2 billion of senior unsecured notes with no borrowings under our revolving credit facility, accounts receivable securitization facility or repurchase facility.

Conference Call 
We will host a conference call to discuss the results on August 5, 2019 at 4:30 p.m. Eastern Time. The conference call numbers are 888-204-4368 (U.S. callers) and 323-794-2423 (International callers) and the passcode for both is 1071539.  Live and replay versions of the conference call will be webcast in the Investor Relations section of our website, www.OUTFRONTmedia.com.

Supplemental Materials
In addition to this press release, we have provided a supplemental investor presentation which can be viewed on our website, www.OUTFRONTmedia.com.

About OUTFRONT Media Inc. 
OUTFRONT leverages the power of technology, location and creativity to connect brands with consumers outside of their homes through one of the largest and most diverse sets of billboard, transit, and mobile assets in North America. Through its technology platform, OUTFRONT will fundamentally change the ways advertisers engage audiences on-the-go.

Contact:



Investors:


Media:

Gregory Lundberg


Carly Zipp

Senior Vice President, Investor Relations


Director of Communications

(212) 297-6441


(212) 297-6479

greg.lundberg@OUTFRONTmedia.com


carly.zipp@OUTFRONTmedia.com


Non-GAAP Financial Measures
In addition to the results prepared in accordance with generally accepted accounting principles in the United States ("GAAP") provided throughout this document, this document and the accompanying tables include non-GAAP financial measures as described below. We calculate organic revenues as reported revenues excluding the impact of foreign currency exchange rates ("non-organic revenues"). We provide organic revenues to understand the underlying growth rate of revenue excluding the impact of non-organic revenue items. Our management believes organic revenues are useful to users of our financial data because it enables them to better understand the level of growth of our business period to period. We calculate and define "Adjusted OIBDA" as operating income (loss) before depreciation, amortization, net (gain) loss on dispositions, stock-based compensation, restructuring charges and impairment charges. We calculate Adjusted OIBDA margin by dividing Adjusted OIBDA by total revenues. Adjusted OIBDA and Adjusted OIBDA margin are among the primary measures we use for managing our business, evaluating our operating performance and planning and forecasting future periods, as each is an important indicator of our operational strength and business performance. Our management believes users of our financial data are best served if the information that is made available to them allows them to align their analysis and evaluation of our operating results along the same lines that our management uses in managing, planning and executing our business strategy. Our management also believes that the presentations of Adjusted OIBDA and Adjusted OIBDA margin, as supplemental measures, are useful in evaluating our business because eliminating certain non-comparable items highlight operational trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures. It is management's opinion that these supplemental measures provide users of our financial data with an important perspective on our operating performance and also make it easier for users of our financial data to compare our results with other companies that have different financing and capital structures or tax rates. We calculate Funds From Operations ("FFO") in accordance with the definition established by the National Association of Real Estate Investment Trusts ("NAREIT"). FFO reflects net income (loss) adjusted to exclude gains and losses from the sale of real estate assets, impairment charges, depreciation and amortization of real estate assets, amortization of direct lease acquisition costs and the same adjustments for our equity-based investments, as well as the related income tax effect of adjustments, as applicable. We calculate Adjusted FFO ("AFFO") as FFO adjusted to include cash paid for direct lease acquisition costs as such costs are generally amortized over a period ranging from four weeks to one year and therefore are incurred on a regular basis. AFFO also includes cash paid for maintenance capital expenditures since these are routine uses of cash that are necessary for our operations. In addition, AFFO excludes restructuring charges, as well as certain non-cash items, including non-real estate depreciation and amortization, stock-based compensation expense, accretion expense, the non-cash effect of straight-line rent and amortization of deferred financing costs, and the non-cash portion of income taxes, as well as the related income tax effect of adjustments, as applicable. We use FFO and AFFO measures for managing our business and for planning and forecasting future periods, and each is an important indicator of our operational strength and business performance, especially compared to other real estate investment trusts ("REITs"). Our management believes users of our financial data are best served if the information that is made available to them allows them to align their analysis and evaluation of our operating results along the same lines that our management uses in managing, planning and executing our business strategy. Our management also believes that the presentations of FFO and AFFO, as supplemental measures, are useful in evaluating our business because adjusting results to reflect items that have more bearing on the operating performance of REITs highlight trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures. It is management's opinion that these supplemental measures provide users of our financial data with an important perspective on our operating performance and also make it easier to compare our results to other companies in our industry, as well as to REITs. Since organic revenues, Adjusted OIBDA, Adjusted OIBDA margin, FFO and AFFO are not measures calculated in accordance with GAAP, they should not be considered in isolation of, or as a substitute for, revenues, operating income (loss) and net income (loss), the most directly comparable GAAP financial measures, as indicators of operating performance. These measures, as we calculate them, may not be comparable to similarly titled measures employed by other companies. In addition, these measures do not necessarily represent funds available for discretionary use and are not necessarily a measure of our ability to fund our cash needs.

Please see Exhibits 4-6 of this release for a reconciliation of the above non-GAAP financial measures to the most directly comparable GAAP financial measures.

Cautionary Statement Regarding Forward-Looking Statements
We have made statements in this document that are forward-looking statements within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by the use of forward-looking terminology such as "believes," "expects," "could," "would," "may," "might," "will," "should," "seeks," "likely," "intends," "plans," "projects," "predicts," "estimates," "forecast" or "anticipates" or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions related to our capital resources, portfolio performance and results of operations. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and may not be able to be realized. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: declines in advertising and general economic conditions; competition; government regulation; our inability to increase the number of digital advertising displays in our portfolio; our ability to implement our digital display platform and deploy digital advertising displays to our transit franchise partners; taxes, fees and registration requirements; our ability to obtain and renew key municipal contracts on favorable terms; decreased government compensation for the removal of lawful billboards; content-based restrictions on outdoor advertising; environmental, health and safety laws and regulations; seasonal variations; acquisitions and other strategic transactions that we may pursue could have a negative effect on our results of operations; dependence on our management team and other key employees; the ability of our board of directors to cause us to issue additional shares of stock without stockholder approval; certain provisions of Maryland law may limit the ability of a third party to acquire control of us; our rights and the rights of our stockholders to take action against our directors and officers are limited; our substantial indebtedness; restrictions in the agreements governing our indebtedness; incurrence of additional debt; interest rate risk exposure from our variable-rate indebtedness; our ability to generate cash to service our indebtedness; cash available for distributions; hedging transactions; diverse risks in our Canadian business; a breach of our security measures; changes in regulations and consumer concerns regarding privacy, information security and data, or any failure or perceived failure to comply with these regulations or our internal policies; asset impairment charges for our long-lived assets and goodwill; our failure to remain qualified to be taxed as a REIT; REIT distribution requirements; availability of external sources of capital; we may face other tax liabilities even if we remain qualified to be taxed as a REIT; complying with REIT requirements may cause us to liquidate investments or forgo otherwise attractive opportunities; our ability to contribute certain contracts to a taxable REIT subsidiary ("TRS"); our planned use of TRSs may cause us to fail to remain qualified to be taxed as a REIT; REIT ownership limits; complying with REIT requirements may limit our ability to hedge effectively; failure to meet the REIT income tests as a result of receiving non-qualifying income; the Internal Revenue Service (the "IRS") may deem the gains from sales of our outdoor advertising assets to be subject to a 100% prohibited transaction tax; establishing operating partnerships as part of our REIT structure; U.S. federal tax reform legislation could affect us in ways that are difficult to anticipate; and other factors described in our filings with the Securities and Exchange Commission (the "SEC"), including but not limited to the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2018, filed with the SEC on February 27, 2019. All forward-looking statements in this document apply as of the date of this document or as of the date they were made and, except as required by applicable law, we disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors of new information, data or methods, future events or other changes.

EXHIBITS

 

Exhibit 1:  CONSOLIDATED STATEMENTS OF OPERATIONS 
(Unaudited)
  See Notes on Page 14




Three Months Ended


Six Months Ended



June 30,


June 30,

(in millions, except per share amounts)


2019


2018


2019


2018

Revenues:









Billboard


$

305.8



$

280.4



$

556.8



$

519.7


Transit and other


154.1



121.3



274.8



219.9


Total revenues


459.9



401.7



831.6



739.6


Expenses:









Operating


240.3



212.0



457.2



409.1


Selling, general and administrative


81.5



70.1



154.8



134.7


Restructuring charges




0.2



0.3



1.3


Net (gain) loss on dispositions


0.4



(2.7)



(1.1)



(2.9)


Impairment charge




42.9





42.9


Depreciation


21.4



21.3



42.5



42.4


Amortization


27.6



25.0



52.3



47.5


Total expenses


371.2



368.8



706.0



675.0


Operating income


88.7



32.9



125.6



64.6


Interest expense, net


(33.9)



(31.0)



(66.6)



(61.0)


Other income (expense), net




(0.2)



0.1



(0.3)


Income before provision for income taxes and equity in
    earnings of investee companies


54.8



1.7



59.1



3.3


Provision for income taxes


(6.2)



(8.1)



(5.2)



(1.4)


Equity in earnings of investee companies, net of tax


1.7



1.2



2.5



2.0


Net income (loss)


$

50.3



$

(5.2)



$

56.4



$

3.9











Net income (loss) per common share:









Basic


$

0.35



$

(0.04)



$

0.39



$

0.02


Diluted


$

0.35



$

(0.04)



$

0.39



$

0.02











Weighted average shares outstanding:









Basic


142.3



139.2



141.5



139.0


Diluted


142.9



139.2



142.0



139.3



 

 

Exhibit 2:  CONSOLIDATED STATEMENTS OF FINANCIAL POSITION 
(Unaudited)
See Notes on Page 14




As of

(in millions)


June 30,
 2019


December 31,
 2018

Assets:





Current assets:





Cash and cash equivalents


$

474.8



$

52.7


Restricted cash


1.4



1.4


Receivables, less allowance ($12.1 in 2019 and $10.7 in 2018)


277.9



264.9


Prepaid lease and transit franchise costs


12.7



69.3


Prepaid MTA equipment deployment costs


48.4



18.9


Other prepaid expenses


24.6



13.9


Other current assets


7.0



8.4


Total current assets


846.8



429.5


Property and equipment, net


660.4



652.9


Goodwill


2,082.4



2,079.7


Intangible assets


551.2



537.2


Operating lease assets


1,389.0




Prepaid MTA equipment deployment costs


77.3



60.6


Other assets


57.9



68.8


Total assets


$

5,665.0



$

3,828.7







Liabilities:





Current liabilities:





Accounts payable


$

60.3



$

56.5


Accrued compensation


36.2



47.1


Accrued interest


19.2



19.1


Accrued lease and transit franchise costs


46.2



44.2


Other accrued expenses


39.9



31.2


Deferred revenues


30.9



29.8


Short-term debt


546.4



160.0


Short-term operating lease liabilities


161.7




Other current liabilities


18.5



14.7


Total current liabilities


959.3



402.6


Long-term debt, net


2,245.9



2,149.6


Deferred income tax liabilities, net


19.1



17.0


Asset retirement obligation


34.8



34.2


Operating lease liabilities


1,221.3




Other liabilities


49.7



80.0


Total liabilities


4,530.1



2,683.4







Commitments and contingencies










Stockholders' equity:





Common stock (2019 - 450.0 shares authorized, and 143.3 shares issued





 and outstanding; 2018 - 450.0 shares authorized, and 140.2 issued and outstanding)


1.4



1.4


Additional paid-in capital


2,057.9



1,995.0


Distribution in excess of earnings


(943.9)



(871.6)


Accumulated other comprehensive loss


(17.7)



(22.0)


Total stockholders' equity


1,097.7



1,102.8


Non-controlling interests


37.2



42.5


Total equity


1,134.9



1,145.3


Total liabilities and equity


$

5,665.0



$

3,828.7



 

 

Exhibit 3:  CONSOLIDATED STATEMENTS OF CASH FLOWS 
(Unaudited)
 See Notes on Page 14




Six Months Ended



June 30,

(in millions)


2019


2018

Operating activities:





Net income


$

56.4



$

3.9


Adjustments to reconcile net income to net cash flow provided by operating activities:





Depreciation and amortization


94.8



89.9


Deferred tax (benefit) provision


3.4



(1.4)


Stock-based compensation


10.8



10.6


Provision for doubtful accounts


3.4



(1.0)


Accretion expense


1.3



1.2


Net gain on dispositions


(1.1)



(2.9)


Impairment charge




42.9


Equity in earnings of investee companies, net of tax


(2.5)



(2.0)


Distributions from investee companies


1.6



1.3


Amortization of deferred financing costs and debt discount and premium


3.0



2.8


Cash paid for direct lease acquisition costs


(24.0)



(20.5)


Change in assets and liabilities, net of investing and financing activities:





Increase in receivables


(15.5)



(8.6)


Increase in prepaid MTA equipment deployment costs


(46.2)



(31.8)


Increase in prepaid expenses and other current assets


(2.2)



(2.3)


Decrease in accounts payable and accrued expenses


(7.0)



(19.3)


Increase in deferred revenues


1.1



7.5


Decrease in income taxes


(3.5)



(3.0)


Other, net


9.7



0.9


Net cash flow provided by operating activities


83.5



68.2







Investing activities:





Capital expenditures


(39.6)



(46.4)


Acquisitions


(34.4)



(4.3)


MTA franchise rights


(10.7)



(6.1)


Net proceeds from dispositions


2.2



3.4


Net cash flow used for investing activities


(82.5)



(53.4)







Financing activities:





Proceeds from long-term debt borrowings


705.0



79.0


Repayments of long-term debt borrowings


(55.0)



(10.0)


Proceeds from borrowings under short-term debt facilities


30.0



75.0


Repayments of borrowings under short-term debt facilities


(190.0)



(55.0)


Payments of deferred financing costs


(8.6)



(0.1)


Proceeds from shares issued under the ATM Program


50.9




Taxes withheld for stock-based compensation


(7.7)



(8.1)


Dividends


(103.9)



(102.0)


Net cash flow provided by (used for) financing activities


420.7



(21.2)







Effect of exchange rate changes on cash, cash equivalents and restricted cash


0.4



(0.2)


Net increase (decrease) in cash, cash equivalents and restricted cash


422.1



(6.6)


Cash, cash equivalents and restricted cash at beginning of period


54.1



48.3


Cash, cash equivalents and restricted cash at end of period


$

476.2



$

41.7


 

Exhibit 3:  CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(Unaudited)
 See Notes on Page 14




Six Months Ended



June 30,

(in millions)


2019


2018

Supplemental disclosure of cash flow information:





Cash paid for income taxes


$

5.3



$

5.9


Cash paid for interest


64.3



58.5







Non-cash investing and financing activities:





Accrued purchases of property and equipment


11.4



6.8


Accrued MTA franchise rights


3.3





 

Exhibit 4:  SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION 
(Unaudited) See Notes on Page 14




Three Months Ended June 30, 2019











(in millions, except percentages)


U.S. Media


Other



Corporate


Consolidated

Revenues:










Billboard


$

285.1



$

20.7




$



$

305.8


Transit and other


134.5



19.6






154.1


Total revenues


$

419.6



$

40.3




$



$

459.9


Organic revenues(a):










Billboard


$

285.1



$

20.7




$



$

305.8


Transit and other


134.5



19.6






154.1


 Total organic revenues(a)


$

419.6



$

40.3




$



$

459.9


Non-organic revenues(b):










Billboard


$



$




$



$


Transit and other










Total non-organic revenues(b)


$



$




$



$












Operating income (loss)


$

101.9



$

3.3




$

(16.5)



$

88.7


Net loss on dispositions


0.2



0.2






0.4


Depreciation and amortization


43.7



5.3






49.0


Stock-based compensation







5.5



5.5


Adjusted OIBDA


$

145.8



$

8.8




$

(11.0)



$

143.6












Adjusted OIBDA margin


34.7

%


21.8

%



*



31.2

%











Capital expenditures


$

21.0



$

0.5




$



$

21.5














Three Months Ended June 30, 2018











(in millions, except percentages)


U.S. Media


Other



Corporate


Consolidated

Revenues:










Billboard


$

262.5



$

17.9




$



$

280.4


Transit and other


104.7



16.6






121.3


Total revenues


$

367.2



$

34.5




$



$

401.7


Organic revenues(a)










Billboard


$

262.5



$

17.3




$



$

279.8


Transit and other


104.7



16.4






121.1


 Total organic revenues(a)


$

367.2



$

33.7




$



$

400.9


Non-organic revenues(b):










Billboard


$



$

0.6




$



$

0.6


Transit and other




0.2






0.2


Total non-organic revenues(b)


$



$

0.8




$



$

0.8












Operating income (loss)


$

93.8



$

(45.1)




$

(15.8)



$

32.9


Restructuring charges




0.2






0.2


Net gain on dispositions


(2.7)








(2.7)


Impairment charge




42.9






42.9


Depreciation and amortization


40.1



6.2






46.3


Stock-based compensation







5.6



5.6


Adjusted OIBDA


$

131.2



$

4.2




$

(10.2)



$

125.2












Adjusted OIBDA margin


35.7

%


12.2

%



*



31.2

%











Capital expenditures


$

25.6



$

4.0




$



$

29.6












 

 



Six Months Ended June 30, 2019

(in millions, except percentages)


U.S. Media


Other



Corporate


Consolidated

Revenues:










Billboard


$

521.3



$

35.5




$



$

556.8


Transit and other


236.7



38.1






274.8


Total revenues


$

758.0



$

73.6




$



$

831.6


Organic revenues(a):










Billboard


$

521.3



$

35.5




$



$

556.8


Transit and other


236.7



38.1






274.8


 Total organic revenues(a)


$

758.0



$

73.6




$



$

831.6


Non-organic revenues(b):










Billboard


$



$




$



$


Transit and other










Total non-organic revenues(b)


$



$




$



$












Operating income (loss)


$

157.4



$

(0.7)




$

(31.1)



$

125.6


Restructuring charges







0.3



0.3


Net (gain) loss on dispositions


(1.3)



0.2






(1.1)


Depreciation and amortization


84.3



10.5






94.8


Stock-based compensation







10.8



10.8


Adjusted OIBDA


$

240.4



$

10.0




$

(20.0)



$

230.4












Adjusted OIBDA margin


31.7

%


13.6

%



*



27.7

%











Capital expenditures


$

38.3



$

1.3




$



$

39.6














Six Months Ended June 30, 2018

(in millions, except percentages)


U.S. Media


Other



Corporate


Consolidated

Revenues:










Billboard


$

488.8



$

30.9




$



$

519.7


Transit and other


188.3



31.6






219.9


Total revenues


$

677.1



$

62.5




$



$

739.6


Organic revenues(a)










Billboard


$

488.8



$

29.7




$



$

518.5


Transit and other


188.3



31.3






219.6


 Total organic revenues(a)


$

677.1



$

61.0




$



$

738.1


Non-organic revenues(b):










Billboard


$



$

1.2




$



$

1.2


Transit and other




0.3






0.3


Total non-organic revenues(b)


$



$

1.5




$



$

1.5












Operating income (loss)


$

144.4



$

(52.1)




$

(27.7)



$

64.6


Restructuring charges


0.5



0.8






1.3


Net gain on dispositions


(2.9)








(2.9)


Impairment charge




42.9






42.9


Depreciation and amortization


78.1



11.8






89.9


Stock-based compensation







10.6



10.6


Adjusted OIBDA


$

220.1



$

3.4




$

(17.1)



$

206.4












Adjusted OIBDA margin


32.5

%


5.4

%



*



27.9

%











Capital expenditures


$

40.0



$

6.4




$



$

46.4


 

 

Exhibit 5:  SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES   
(Unaudited) See Notes on Page 14




Three Months Ended


Six Months Ended



June 30,


June 30,

(in millions, except per share amounts)


2019


2018


2019


2018

Net income (loss)


$

50.3



$

(5.2)



$

56.4



$

3.9


Depreciation of billboard advertising structures


15.9



17.1



32.2



34.1


Amortization of real estate-related intangible assets


10.9



10.6



21.8



21.2


Amortization of direct lease acquisition costs


13.0



11.1



23.3



19.8


Net (gain) loss on disposition of real estate assets


0.4



(2.7)



(1.1)



(2.9)


Impairment charge




42.9





42.9


Adjustment related to equity-based investments


0.1





0.1



0.1


Income tax effect of adjustments(c)




0.3





0.3


FFO


$

90.6



$

74.1



$

132.7



$

119.4











FFO


$

90.6



$

74.1



$

132.7



$

119.4


Non-cash portion of income taxes


1.7



2.4



(0.1)



(4.5)


Cash paid for direct lease acquisition costs


(10.0)



(8.0)



(24.0)



(20.5)


Maintenance capital expenditures


(4.5)



(7.0)



(8.6)



(10.1)


Restructuring charges




0.2



0.3



1.3


Other depreciation


5.5



4.2



10.3



8.3


Other amortization


3.7



3.3



7.2



6.5


Stock-based compensation


5.5



5.6



10.8



10.6


Non-cash effect of straight-line rent


1.5



0.4



2.6



0.5


Accretion expense


0.7



0.6



1.3



1.2


Amortization of deferred financing costs


1.6



1.4



3.0



2.8


Income tax effect of adjustments(d)








(0.2)


AFFO


$

96.3



$

77.2



$

135.5



$

115.3



 

Exhibit 6:  SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES   
(Unaudited) See Notes on Page 14




Three Months Ended


Six Months Ended



June 30,


June 30,

(in millions)


2019


2018


2019


2018

Adjusted OIBDA


$

143.6



$

125.2



$

230.4



$

206.4


Interest expense, net, less amortization of deferred
    financing costs


(32.3)



(29.6)



(63.6)



(58.2)


Cash paid for income taxes


(4.5)



(5.7)



(5.3)



(5.9)


Cash paid for direct lease acquisition costs


(10.0)



(8.0)



(24.0)



(20.5)


Maintenance capital expenditures


(4.5)



(7.0)



(8.6)



(10.1)


Equity in earnings of investee companies, net of tax


1.7



1.2



2.5



2.0


Adjustment related to equity-based investments


0.1





0.1



0.1


Non-cash effect of straight-line rent


1.5



0.4



2.6



0.5


Accretion expense


0.7



0.6



1.3



1.2


Other income (expense)




(0.2)



0.1



(0.3)


Income tax effect of adjustments(c)(d)




0.3





0.1


AFFO


$

96.3



$

77.2



$

135.5



$

115.3



 

Exhibit 7:  OPERATING EXPENSES

(Unaudited) See Notes on Page 14




Three Months Ended




Six Months Ended



(in millions, except


June 30,


%


June 30,


%

percentages)


2019


2018


Change


2019


2018


Change

Operating expenses:













Billboard property lease


$

101.7



$

94.5



7.6

%


$

197.7



$

188.0



5.2

%

Transit franchise


73.6



59.2



24.3



131.7



106.5



23.7


Posting, maintenance and other


65.0



58.3



11.5



127.8



114.6



11.5


Total operating expenses


$

240.3



$

212.0



13.3



$

457.2



$

409.1



11.8


 

Exhibit 8:  EXPENSES BY SEGMENT

(Unaudited) See Notes on Page 14




Three Months Ended




Six Months Ended



(in millions, except


June 30,


%


June 30,


%

percentages)


2019


2018


Change


2019


2018


Change

U.S. Media:













Operating expenses


$

217.3



$

189.3



14.8

%


$

410.7



$

364.8



12.6

%

SG&A expenses


56.5



46.7



21.0



106.9



92.2



15.9















Other:













Operating expenses


23.0



22.7



1.3



46.5



44.3



5.0


SG&A expenses


8.5



7.6



11.8



17.1



14.8



15.5


 

NOTES TO EXHIBITS


PRIOR PERIOD PRESENTATION CONFORMS TO CURRENT REPORTING CLASSIFICATIONS.


(a)

Organic revenues exclude the impact of foreign currency exchange rates ("non-organic revenues").

(b)

In the three and six months ended June 30, 2018, non-organic revenues reflect the impact of foreign currency
exchange rates.

(c)

Income tax effect related to Net (gain) loss on disposition of real estate assets.

(d)

Income tax effect related to Restructuring charges.


*     Calculation not meaningful

 

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SOURCE OUTFRONT Media Inc.

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