oOh!media’s share price surges on half-year results
Out-of-home (OOH) company oOh!media posted a 6% jump in net profit for the six months to the end of June, though underlying earnings were lower on the back of higher rent-related costs.
The bottom line was helped by a 7% jump in revenue to almost $300 million.
Chief executive officer Cathy O’Connor said oOh! continued to successfully leverage the strong growth in OOH which outperformed other media formats, taking a record share from traditional media during the period.
Investment analysts welcomed the result pushing the group’s share price up 6% in early trading.
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Adjusted NPAT was flat while adjusted underlying earnings were down 4%.
oOh!media attributed adjustment, in part, to an increased fixed rent relating to the renewal of some larger contracts during calendar year 2022, and lower rental abatements in the first half of 2023.
“While there has been no material changes in status for leases expiring in CY23 since our last update in February, we continue to have positive active dialogue with our lease partners,” O’Connor said.
In May this year, oOh!media’s share price fell 24% in a few hours after O’Connor gave a trading update at a Macquarie Conference. Over 48 hours, the company’s market valuation went from $970 million to just $700 million.
At the time, investment analysts concluded that the outdoor group was losing market share despite being in the fastest-growing media category. In the latest report, the group had 40% share in the ANZ market compared to 43% in pcp.
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By format, Fly was the fastest growing category with 73% growth to $21 million in the first half of 2023. The category pulling in the most revenue, Road, reported 12% revenue growth on the previous corresponding period to $103.4 million. Street & Rail revenue decreased by 3% to $93.5 million.
“During the period we successfully secured three new contracts representing approximately $30 million in annualised revenue upside from mid-2024,” added O’Connor.
“These contracts, including Sydney Metro, Sydney Metro Martin Place Station and Woollahra Council, also provide significantly enhanced coverage across the key Sydney CBD and inner metropolitan market to deliver network advertising solutions for our customers.
“We continued to make good progress on our strategy which remains focused on driving revenue growth through leveraging our portfolio of existing assets with continued investments in digital and data capabilities to improve advertisers’ return on investment.”
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Darcy Song was a reporter at Mumbrella, covering media owners, adtech and social platforms. She left in October 2023.
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