oOh! Media half year results show the outdoor giant’s digital revenue growing from 44.5 per cent to 52.1 per cent, which it says is the first time digital has taken over from traditional billboards.
However, the company has 13,000 traditional billboards across Australia and New Zealand compared to its 8,000 digital billboards across Australia and New Zealand.
oOh! revenue is up 18 per cent from $146.6m at HY16 to $173m, its gross profit rose 25.1 per cent from $60.1m at HY16 to $75.3m.
Its gross profit margin expanded to 43.5 per cent up from 41 per cent in the previous year. The underlying EBITDA is up 27 per cent from $26.8m to $34m. The NPAT came in at $7.1m up 18.3 per cent from $6m.
During the first half of the year oOh! says it introduced 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.
[Related: oOh! wins SA billboard tender]
Brendon Cook, CEO of oOh! says, “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 who complementarity and diversity enables us to deliver strong group revenue and profit growth.
“We are executing our end-to-end digital strategy, investing to maintain our market leadership position, and continuing to deliver innovative and effective solutions for advertisers. We will also continue to explore opportunities to further strengthen and develop our new media strategy and enhance shareholder value through organic growth and acquisitions.”
oOh! says it is continuing 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.
The company’s divisional highlights include road and retail delivering double digit growth, locate delivering double digit growth despite the revenue growth from ECN, acquired in November being slower than anticipated and New Zealand grew its revenue by 41 per cent on a like-for-like basis, after adjusting for Westfield in-housing its media footprint.
oOh! says it remains well positioned to capitalise on growth opportunities, with net debt and underlying EBITDA at 1.7 times and well within the financial covenants of its debt facilities agreements, producing headroom to continue investing for further growth. Higher EBIDTA and improved working capital management resulted in net cash flow from operating activities increasing from $3.5m to $11.5m.
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