• Organic Revenue Growth: Up 3.9% in Q4 2024.
• Billboard Revenue Growth: Up 2% in Q4 2024, driven by higher rates and increased occupancy.
• Digital Billboard Revenue Growth: Up 4.7% in Q4 2024.
• Transit Revenue Growth: Up 9% in Q4 2024, with digital revenues up 12% and static revenues up 7%.
• Adjusted OIBDA: $155 million in Q4 2024, up 8.5% year-over-year.
• AFFO: $119 million in Q4 2024; full-year 2024 AFFO grew 11.5%.
• Billboard Adjusted OIBDA Margin: Increased by 80 basis points to 40.3% in Q4 2024.
• CapEx: $18 million in Q4 2024; full-year 2024 CapEx was $78 million.
• Net Leverage: Reduced to 4.7x at the end of 2024 from 5.4x at the end of 2023.
• Dividend: $0.30 per share, payable on March 31, 2025.

• Warning! GuruFocus has detected 11 Warning Signs with OUT.

Release Date: February 25, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Organic revenues grew by 3.9% in Q4, slightly ahead of guidance.
• Billboard revenues increased by 3% for the year, driven by higher static and digital growth.
• Transit revenues rebounded by nearly 9% in 2024, with the New York MTA growing by 12%.
• Digital automated sales increased significantly, representing nearly 17% of total digital revenues.
• Leverage was reduced from 5.4x to 4.7x by the end of 2024, following the sale of the Canadian business.

Negative Points

• Local ad growth was softer than expected in Q4, attributed to macroeconomic uncertainties.
• Certain categories like CPG, health and medical, and alcohol showed weaker performance.
• Billboard expenses increased slightly due to higher maintenance and utilities costs.
• Transit franchise expenses rose due to contractually obligated increases.
• The exit of a marginally profitable contract in New York impacted billboard revenue growth.

Q & A Highlights

Q: Given the congestion tax in New York City and the work-from-home push or back-to-work push by some financial institutions, are you seeing any incremental interest among advertisers for the New York MTA contract? A: Matthew Siegel, CFO, responded that the MTA was a significant driver of revenue growth and EBITDA last year, with revenue growing about 12%. The performance has been strong, and while it's unclear if this is due to congestion pricing or back-to-work trends, the sales force's efforts and focus have been effective.

Q: What was driving the softer than expected local ad growth in the fourth quarter, and what are you most excited about for OUTFRONT's future? A: Matthew Siegel, CFO, noted that solid comps from 2023 and macro uncertainty post-election impacted local ad growth. However, better pacing is expected in the second half of the year. Nick Brien, Interim CEO, expressed excitement about OUTFRONT's strong internal creative resources, digital innovation lab, and the ability to integrate digital out-of-home advertising with broader campaigns.

Q: Can you elaborate on the strength in national ad growth and expectations for revenue growth for the remainder of the year? A: Matthew Siegel, CFO, mentioned strong national performance driven by events like the Super Bowl in New Orleans and Nashville's transit performance. While they don't provide full-year revenue guidance, they expect better quarters ahead, as indicated by their AFFO guidance.

Q: Could you update us on the CEO transition process and your role as Interim CEO? A: Nick Brien, Interim CEO, confirmed that a formal search process is underway with a subcommittee of the Board and a leading recruitment firm. The transition aims to ensure the company has the necessary expertise during this period, with Brien leveraging his experience to support the company.

Q: What drove the strength in transit OIBDA in the quarter, and what are your expectations for transit growth this year? A: Matthew Siegel, CFO, attributed the strength in transit OIBDA to strong performance from the MTA and national transit, particularly in the fourth quarter. The portfolio is performing better than in 2023, and they anticipate continued growth in 2025.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.