Slowdown in Aus economy affects JCDecaux

A “major slowdown” in the Australian economy has impacted JCDecaux, with its co-CEO and chairman of the executive board Jean-François Decaux commenting that the slump is expected to impact its earning guidance for Q4.

“As far as Q4 2019 is concerned, there is no real change in current trading compared to Q3 2019 except for Hong Kong in China, where we see some further deterioration, and Australia, where the overall media market is negatively impacted by the major slowdown in the economy,” Decaux said.

“As a result, and bearing in mind the solid Q4 2018, we expect our adjusted organic revenue growth rate to be negative, around two per cent, leading to a full year organic revenue growth rate above 1.5 per cent.”

The outdoor advertising company recently announced its global adjusted revenue for the nine months ending 30 September 2019.

Adjusted revenue for the third quarter of 2019 increased by 6.7 per cent to €925.8 million compared to €867.7 million in the third quarter of 2018.

It added that adjusted organic advertising revenue, excluding revenue related to sale, rental and maintenance of street furniture and advertising displays, was flat in the third quarter of 2019 compared to the third quarter of 2018.

“Our Q3 2019 organic revenue growth rate of 0.1 per cent, which is in line with our July guidance, reflects a difficult quarter in China offset by a good performance in UK, US and the rest of the world while France and the Rest of Europe were resilient,” Decaux said.

“Our organic revenue decline of 1.6 per cent in our billboard division reflects soft market conditions in certain geographies lacking consolidation, while our group digital billboard revenue up 141.1 per cent, benefited from the integration of APN Outdoor as well as from the rationalisation and digitisation of our UK traditional billboard network.”

Decaux added that in a media landscape that is increasingly fragmented, out-of-home advertising reinforces its attractiveness.

“With our accelerating exposure to faster-growth markets, our growing premium digital portfolio combined with a new data-led audience targeting platform, our ability to win new contracts and the high quality of our teams across the world, we believe we are well positioned to outperform the global advertising market and increase our leadership position in the outdoor advertising industry through profitable market share gains,” Decaux said.

“The strength of our balance sheet is a key competitive advantage that will allow us to pursue further external growth opportunities as they arise and to continue to invest significantly in digital.”

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