ASX-listed (OML) oOh!media has posted its calendar year 2021 results showing an 18% revenue increase to $503.7 million with the road (billboard) category the standout performer notching a 34 per cent increase in revenue to $158 million and surpassing CY2019 results.
The company which owns wide format printer Cactus Imaging, also reported a 1.8 per cent increase in gross margin to 44 per cent with an underlying NPATA of $12.7 million, compared to a loss of $8.5 million in the previous year.
OML will also offer a one cent fully franked dividend to share holders in March this year.
In oOh!media’s other categories, revenue in street furniture and rail increased 23 per cent to $182 million as audiences continued to return from COVID lockdowns. Retail also rebounded significantly from the prior year with an increase of 18 per cent compared to CY20 to $125 million. December 2021 was a record month of oOh! as it successfully leveraged audience growth in the market.
The fly and locate categories continued to be COVID-hit amid air travel restrictions and employees continuing to work from home.
Between $45 million and $55 million has also been earmarked for capital expenditure for CY22.
oOh!media CEO Cathy O’Connor has now spent one full year in the top job and remains upbeat about out of home’s potential as an advertising medium.
She also pointed to a dramatic bounce back in November and December 2021 after lockdowns in NSW and Victoria eased.
“oOh!media has delivered strong improvements on its prior year performance. Financial year revenues grew by 18 per cent on the prior year and underlying EBITDA grew by 24 per cent on the prior year. It is pleasing that our road, retail, street furniture and our New Zealand business performed above pre-Covid 2019 levels and aggregates across November and December,” O’Connor said during a results address on Monday morning.
She spoke about the enduring benefits of classic billboard advertising and discussed a major pillar of forward growth is continued development of digital billboards.
She discussed the advantages of the new MOVE 1.0 system which makes it easier for advertisers to book and measure their investment, while also discussing the ongoing benefits of static billboards as a medium which owns 100 per cent share of voice for maximum impact on the passerby.
“The unique power of classic or static advertising to build brands and offer 100 per cent share of voice is widely acknowledged by advertisers and this will continue to be the case,” O’Connor said in her briefing address on Monday.
“Advertisers have also for many years now increasingly invested in all forms of digital media for its immediacy, flexibility and the ease of trade. The digitisation of OOH presents far more opportunity than just the conversion of a static image with a digital image.
“There is now a breadth of opportunity to engage advertisers in new ways using digital OOH. The increasing sophistication to target audiences using data to capture people in the right place at the right time with the right messages to increase effectiveness is compelling.”
A split on digital v classic revenue was not discussed in the briefing but classic’s crucial role in the marketing mix was certainly covered.
“… Obviously we will remain a large player in digital OOH and it will be a significant part of our revenue and we will obviously maintain a very competitive share of the digital revenue and as that revenue grows as a percentage of total sector revenue then total sector revenue will grow with it based on the pipeline that we have,” O’Connor said.
“In terms of classic it is an incredibly valuable part of what we do. I think in this digital world there are very few media opportunities that provide the share of voice that classic out of home does and we’ve actually also seen data from our advertisers throughout 2021 that shows that classic format advertising shows terrific ROI in a lot of the proprietary data analysis that our customers are doing so it is going to continue to be an important part of the picture notwithstanding the power we have ahead of us with our digital evolution as well.”
oOh!media CFO Sheila Lines said the margin mix within digital and classic billboards is driven by the commercial arrangements held with that client rather than the physical type of asset. She added a strong ROI case is also built when decided whether to move forward with a plan to digitise assets.
In other comments, O’Connor said the growing list of members at the Outdoor Media Association now means the organisation is a truly representative body which will only further enhance growth in the sector.
Further work is also ongoing towards the MOVE 2.0 system which marks another important step towards making it easier for advertisers to plan, buy and measure OOH campaigns. She added this will including monthly and seasonal variations and hourly movements.
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