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OUTFRONT Media (OUT) Q2 AFFO Beats Estimates, Revenues Miss
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OUTFRONT Media Inc. (OUT - Free Report) reported second-quarter 2024 adjusted funds from operations (AFFO) per share of 49 cents, which surpassed the Zacks Consensus Estimate of 46 cents.
Results reflect lower operating expenses due to lower property lease costs. The company also witnessed higher average revenue per display (yield) across its portfolio. However, a rise in interest expenses hurt the performance to some extent.
However, quarterly revenues came in at $477.3 million, which missed the Zacks Consensus Estimate of $482.1 million.
On a year-over-year basis, AFFO per share increased by 4.3%, and revenues rose by 1.8%.
In June 2024, OUT sold its entire equity stake in Outdoor Systems Americas ULC and its subsidiaries, which hold its portfolio of Canadian assets, for $410 million in cash.
According to Jeremy Male, chairman and CEO of OUTFRONT Media, “Our U.S. Media business continued to display solid growth during the quarter, with revenue up 4% and Adjusted OIBDA up nearly double that, demonstrating the operating leverage in our business.”
Quarter in Detail
During the reported quarter, billboard revenues were $373.4 million, reflecting year-over-year growth of 0.5%. The upside resulted mainly due to an increase in average revenue per display and the impact of new and lost billboards in the period, including insignificant acquisitions, partly offset by the impact of the transactionrelating to the Canadian asset sale.
The company’s transit and other revenues of $103.9 million increased 6.9% from the year-ago quarter. The rise was primarily due to an increase in average revenue per display, partially offset by the impact of new and lost transit franchise contracts in the period.
Operating expenses were $239.8 million, which decreased 2.5% year over year. The decline was mostly due to lower billboard property lease costs and the Canadian asset sale, partly offset by higher posting, maintenance and other expenses.
Net interest expenses of $41.1 million increased 3.5% from $39.7 million in the prior-year period, mainly due to higher interest rates and a greater average debt balance. The weighted average cost of debt, as of Jun 30, 2024, was 5.6% compared with 5.4% at the end of the prior-year period.
Cash Flow & Balance Sheet
Net cash flow provided by operating activities for the six months ended Jun 31, 2024 was $101.6 million, which increased from $87.7 million in the prior-year period.
As of Jun 30, 2024, OUTFRONT Media’s liquidity position comprised unrestricted cash of $49.6 million and $493.7 million of availability under its $500 million revolving credit facility, net of $6.3 million of issued letters of credit.
In the reported quarter, no shares of the company's common stock were sold under its at-the-market (ATM) equity program. It had $232.5 million available under the ATM program at the quarter’s end.
Dividend Update
Concurrent with its second-quarter earnings release, OUTFRONT Media announced its common stock quarterly cash dividend of 30 cents per share. The dividend will be paid out on Sep 27 to its shareholders of record as of Sep 6, 2024.
Ventas, Inc. (VTR - Free Report) reported a second-quarter 2024 normalized FFO per share of 80 cents, which surpassed the Zacks Consensus Estimate of 79 cents. The reported figure increased 6.7% from the prior-year quarter’s tally.
Results reflected growth in occupancy in the same-store senior housing operating portfolio, which contributed to higher revenue generation. The company also improved its 2024 outlook.
Cousins Properties’ (CUZ - Free Report) reported a second-quarter 2024 FFO per share of 68 cents, which beat the Zacks Consensus Estimate of 66 cents. The figure remained unchanged on a year-over-year basis.
Results reflected decent leasing activity and better-than-anticipated revenues. However, rental property operating and interest expenses increased year over year. CUZ also raised its 2024 outlook for FFO per share.
Note: Anything related to earnings presented in this write-up represents FFO — a widely used metric to gauge the performance of REITs.
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OUTFRONT Media (OUT) Q2 AFFO Beats Estimates, Revenues Miss
OUTFRONT Media Inc. (OUT - Free Report) reported second-quarter 2024 adjusted funds from operations (AFFO) per share of 49 cents, which surpassed the Zacks Consensus Estimate of 46 cents.
Results reflect lower operating expenses due to lower property lease costs. The company also witnessed higher average revenue per display (yield) across its portfolio. However, a rise in interest expenses hurt the performance to some extent.
However, quarterly revenues came in at $477.3 million, which missed the Zacks Consensus Estimate of $482.1 million.
On a year-over-year basis, AFFO per share increased by 4.3%, and revenues rose by 1.8%.
In June 2024, OUT sold its entire equity stake in Outdoor Systems Americas ULC and its subsidiaries, which hold its portfolio of Canadian assets, for $410 million in cash.
According to Jeremy Male, chairman and CEO of OUTFRONT Media, “Our U.S. Media business continued to display solid growth during the quarter, with revenue up 4% and Adjusted OIBDA up nearly double that, demonstrating the operating leverage in our business.”
Quarter in Detail
During the reported quarter, billboard revenues were $373.4 million, reflecting year-over-year growth of 0.5%. The upside resulted mainly due to an increase in average revenue per display and the impact of new and lost billboards in the period, including insignificant acquisitions, partly offset by the impact of the transactionrelating to the Canadian asset sale.
The company’s transit and other revenues of $103.9 million increased 6.9% from the year-ago quarter. The rise was primarily due to an increase in average revenue per display, partially offset by the impact of new and lost transit franchise contracts in the period.
Operating expenses were $239.8 million, which decreased 2.5% year over year. The decline was mostly due to lower billboard property lease costs and the Canadian asset sale, partly offset by higher posting, maintenance and other expenses.
Net interest expenses of $41.1 million increased 3.5% from $39.7 million in the prior-year period, mainly due to higher interest rates and a greater average debt balance. The weighted average cost of debt, as of Jun 30, 2024, was 5.6% compared with 5.4% at the end of the prior-year period.
Cash Flow & Balance Sheet
Net cash flow provided by operating activities for the six months ended Jun 31, 2024 was $101.6 million, which increased from $87.7 million in the prior-year period.
As of Jun 30, 2024, OUTFRONT Media’s liquidity position comprised unrestricted cash of $49.6 million and $493.7 million of availability under its $500 million revolving credit facility, net of $6.3 million of issued letters of credit.
In the reported quarter, no shares of the company's common stock were sold under its at-the-market (ATM) equity program. It had $232.5 million available under the ATM program at the quarter’s end.
Dividend Update
Concurrent with its second-quarter earnings release, OUTFRONT Media announced its common stock quarterly cash dividend of 30 cents per share. The dividend will be paid out on Sep 27 to its shareholders of record as of Sep 6, 2024.
Currently, the company has a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
OUTFRONT Media Inc. Price, Consensus and EPS Surprise
OUTFRONT Media Inc. price-consensus-eps-surprise-chart | OUTFRONT Media Inc. Quote
Performance of Other REITs
Ventas, Inc. (VTR - Free Report) reported a second-quarter 2024 normalized FFO per share of 80 cents, which surpassed the Zacks Consensus Estimate of 79 cents. The reported figure increased 6.7% from the prior-year quarter’s tally.
Results reflected growth in occupancy in the same-store senior housing operating portfolio, which contributed to higher revenue generation. The company also improved its 2024 outlook.
Cousins Properties’ (CUZ - Free Report) reported a second-quarter 2024 FFO per share of 68 cents, which beat the Zacks Consensus Estimate of 66 cents. The figure remained unchanged on a year-over-year basis.
Results reflected decent leasing activity and better-than-anticipated revenues. However, rental property operating and interest expenses increased year over year. CUZ also raised its 2024 outlook for FFO per share.
Note: Anything related to earnings presented in this write-up represents FFO — a widely used metric to gauge the performance of REITs.