oOh!media Limited has announced double-digit gains in revenue (+18 per cent) and underlying EBITDA (+27 per cent), further margin expansion, and a 4.5cents interim dividend (+12.5 per cent) for the half year ended 30 June 2017.
For the first time, more than half of group revenue is derived from digital assets. During HY17, oOh! introduced a further 40 large format, premium-located digital screens across all products, taking the total of such screens to 230, and more than 1,800 retail small format screens.
oOh! continues to invest in its end-to-end digital strategy and its digital revenue penetration leads the market. As well as further digitisation of assets, initiatives during the period included investing in proprietary trading systems to harness its exclusive Quantium insights, which were recently launched to major advertisers in a successful pilot. These investments are necessary to ensure continued revenue and earnings growth.
The three acquisitions made during the second half of 2016 were successfully integrated during HY17, and contributed almost half of group revenue and operating cost growth.
Financial highlights included:
- Revenue of $173m (HY16: $146.6m), up 18 per cent
- A diversified portfolio delivering growth across all divisions except Fly
- Gross profit of $75.3m (HY16: $60.1m), up 25.1 per cent
- Gross profit margin expansion to 43.5 per cent (HY16: 41 per cent)
- Underlying EBITDA of $34.0m (HY16: $26.8m), up 27per cent
- Underlying EBITDA1 margin expansion to 19.7 per cent (HY16: 18.3 per cent)
- Underlying adjusted earnings per share1 of 5.3 cents per share (HY16: 4.0 cps), up 31per cent
- Net profit after tax of $7.1m (HY16: $6.0m), up 18.3 per cent
- Interim fully franked dividend of 4.5 cents per share (HY16: 4.0 cps), up 12.5per cent
Operational highlights included:
- Digital revenue as a percentage of total revenue increased to 52.1 per cent (HY16: 44.5 per cent)
- 40 new large format digital screens in premium locations across Road (17) and Retail (23)
- Leading Out Of Home industry position maintained with 8,000 digital panels across Australia and New Zealand (including 230 large format), 13,000 classic panels and 8 online platforms
- Digital investments leading to an increase in campaigns that combined Out Of Home advertising with native content running across mobile, online and social platforms
- Pilot program utilising unique Quantium insights successfully launched
- Cactus Imaging provided improved production and supply chain efficiencies and strengthened the core classic signs business
- Executive Channel Network (ECN) and Junkee Media expanded the Company’s audiences across CBD environments and Millennials
- Junkee Media provided oOh! video production and content creation capabilities, which will increasingly be strategically important to advertisers and property owners
- Underlying EBITDA and earnings per share excludes $2.1m of non-operating items that mainly consist of costs attached to the proposed merger with APN Outdoor
- Executive Channel Network, Junkee Media and Cactus Imaging were acquired in the second half of 2016
According to the Standard Media Index Trends report for June, the Out Of Home sector recorded stronger growth during the half than any other segment of the advertising industry. Out Of Home revenue grew 8.5 per cent for the half compared to a 1.6 per cent decline for the overall media industry.
oOh!media’s CEO, Brendon Cook, said: “oOh!’s strong performance reflects both the sector’s strength and further market share gains by oOh! in its key product categories. We offer advertisers a portfolio of products whose complementarity and diversity enables us to deliver strong group revenue and profit growth.”
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