DGAP-News: Ströer Out-of-Home Media AG: Slightly improved development in Q3 2012
(firmenpresse) - DGAP-News: Ströer Out-of-Home Media AG / Key word(s): Quarter Results
Ströer Out-of-Home Media AG: Slightly improved development in Q3 2012
13.11.2012 / 07:01
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PRESS RELEASE
Ströer: Slightly improved development in Q3 2012
- Consolidated revenue down 4.5% to EUR 397.4m
- Organic revenue falls 5.1%
- Decline in operational EBITDA from EUR 84.0m to EUR 58.5m
- New advertising formats in Turkey
- Revenue growth in the digital business
Cologne, 13 November 2012 The third quarter of 2012 saw Ströer
Out-of-Home Media AG continue to invest selectively in its specific growth
projects in Germany and abroad. The Group focused particularly on the
roll-out of digital advertising media and premium billboards and is seeing
positive developments especially in the digital business. However, this
trend was overshadowed by the ongoing financial and economic crisis and the
defensive booking behavior among major customers. Therefore the high
revenue figures of the prior year could not be repeated. The consolidated
organic revenue went down 5.1% (prior year: up 5.8%). Overall, revenue fell
4.5% to EUR 397.4m (prior year: EUR 416.3m).
The fall in revenue was accompanied by a EUR 14.4m increase in the cost of
sales to EUR 286.5m in the same period. This was mainly attributable to
inflation-related rent adjustments and start-up costs for newly acquired
contracts in Turkey. These developments saw operational EBITDA decrease to
EUR 58.5m (prior year: EUR 84.0m) and the operational EBITDA margin drop to
14.7% (prior year: 20.2%). The financial result was positively influenced
by the appreciation of the Turkish lira and the Polish zloty against the
euro and first interest savings from the new Group financing agreed in July
2012.
Profit for the period adjusted for exceptional items decreased from EUR
21.1m to EUR 2.8m.
'We announced that we would continue to invest in the digital business in
particular, despite the generally weak economic environment. The figures
from our business prove we are on the right track: the Out-of-Home-Channel
at the two most frequented public places - train stations and shopping
malls - showed a significant percentage growth in revenue in the first nine
months. We expect the trend toward the digitalization of the media
landscape and the stronger cross-linking of traditional business and
digital services to continue and be the driving force for the development
of Ströer's new business segments,' said Udo Müller, CEO of Ströer.
At EUR 23.0m, cash flows from operating activities are EUR 31.5m down on
the prior year. Cash flows from investing activities continued to be shaped
by investments in growth projects such as the Out-of-Home-Channel and the
roll-out of premium billboards in Turkey. Despite significantly scaled down
investment activity in the third quarter, free cash flow decreased to EUR
-10.9m (prior year: EUR 18.8m) owing to the overall weaker business volume.
Together with the transaction costs incurred for the new loan, this pushed
net debt up to EUR 317.5m, which equates to a leverage ratio of 2.97.
Operating segments
Ströer Germany
The Ströer Germany segment was also unable to match the prior-year revenue
figures in the third quarter, although the decline was less pronounced than
in the second quarter. This ongoing unfavorable development was largely due
to the continued cautious approach to bookings taken by major national
customers for high-margin products and the loss of a major customer from
the mobile communications sector. A slight increase in revenue was recorded
in regional operations both in the third quarter and the reporting period
as a whole. Revenue in the digital business was extremely positive in the
third quarter, underscoring the potential of Ströer's digital offering.
Nevertheless, at EUR 293.4m, revenue from this segment in the first nine
months of 2012 was down 4.6% on the prior-year period, which was shaped by
particularly strong growth (prior year: EUR 307.7m). Organic revenue
declined by 5.2% (prior year: up 7.4%). Against this backdrop, the
segment's operational EBITDA decreased for the third quarter running from
EUR 77.2m to EUR 61.0m, as did the operational EBITDA margin, falling from
25.1% to 20.8%.
Ströer Turkey
The Ströer Turkey segment is being hit by consistently weak domestic
demand, which is also severely limiting growth in the advertising market
this year. The cautious approach taken by customers was especially evident
towards the end of September, when orders that had already been placed were
canceled at short notice. The segment also terminated low-margin contracts
at the end of 2011, leading to the loss of an additional EUR 2.5m in
revenue year to date. Against this background and supported by positive FX
effects, revenue in the third quarter increased only slightly on the 2011
comparative figure. In the first nine months 2012, revenue fell 1.6% from
EUR 64.0m to EUR 62.9m. Organic growth stood at -3.2%, compared with 2.9%
in the prior year.
Ströer Turkey's cost of sales again rose year on year in the third quarter,
due in particular to start-up costs for the expansion of the billboard
marketing concession in Istanbul. Compared with the end of 2011, the number
of marketable advertising faces increased by more than 2,000 units. In this
context, Ströer presented two new advertising formats: Premium Billboards,
which are marketed as part of the traditional billboard network, and Giant
Boards, consisting of four connected billboards which are marketed as one
giant advertising face. Overall, neither lower overheads nor increased
margins from portfolio optimization were able to offset the additional
leasing expenditures. As a result, the Ströer Turkey segment saw its
operational EBITDA fall to EUR 1.4m (prior year: EUR 10.9m) year on year in
the first nine months of 2012 and its operational EBITDA margin drop to
2.3% (prior year: 17.0%).
Other segment
The 'Other' segment includes our Polish out-of-home activities and the
western European giant poster business of the blowUP division. The
performance of the two sub-segments has differed in the year to date.
Ströer Poland posted a market-related double-digit percentage decline in
revenue in the first nine months.
This is attributable to the sustained high level of price competition,
lower capacity utilization rates and the absence of the prior-year boost
from the parliamentary elections. Cuts in running costs and overheads were
able to only partly cushion these effects. As a result, both operational
EBITDA and the operational EBITDA margin were below the prior-year level.
The blowUP sub-segment was also unable to match its strong prior-year
revenue figures in the reporting period, despite recording significant
third-quarter revenue growth from giant poster activities in the Benelux
countries and the UK. Overall, revenue in the 'Other' segment dropped 8.6%
to EUR 41.2m (prior year: EUR 45.1m), while organic growth deteriorated to
-7.4% (prior year: -2.1%). Operational EBITDA decreased from EUR 3.2m to
EUR 1.5m. The operational EBITDA margin declined from 7.0% to 3.7%.
Forecast
Out-of-home advertising markets continue to be affected by the uncertainty
on the economic and financial markets as well as cautious customer
sentiment. However, we are seeing relative improvements in Q4 booking
behavior in comparison to Q3. We therefore expect a low single digit
percent decline in Group organic revenues in the fourth quarter of 2012.
The Group's financial figures at a glance
In EUR m 9M 2012 9M 2011 Change1 Excluding exchange rate effects and effects from the (de-)consolidation
Revenue 397.4 416.3 -4.5%
Ströer Germany 293.4 307.7 -4.6%
Ströer Turkey 62.9 64.0 -1.6%
Other 41.2 45.1 -8.6%
Billboard 207.6 223.4 -7.1%
Street furniture 102.7 105.8 -3.0%
Transport 61.8 61.2 1.1%
Other 25.3 25.9 -2.6%
Organic growth(1) -5.1% 5.8%
Gross profit(2) 110.9 144.3 -23.1%
Operational EBITDA(3) 58.5 84.0 -30.4%
Operational EBITDA(3) margin 14.7% 20.2%
Adjusted EBIT(4) 29.3 58.6 -50.1%
Adjusted EBIT(4) margin 7.4% 14.1%
Adjusted profit or loss for the period(5) 2.8 21.1 -86.9%
Adjusted earnings per share(6) (EUR) 0.09 0.54 -83.3%
Profit or loss for the period(7) -17.4 -17.5 0.5%
Earnings per share(8) (EUR) -0.39 -0.37 -3.8%
Investments(9) 30.1 36.0 -16.5%
Free cash flow(10) -10.9 18.8 n.d.
30 Sep 2012 31 Dec 2011 Change
Total equity and liabilities 882.8 982.6 -10.2%
Equity 261.4 273.5 -4.4%
Equity ratio 29.6% 27.8%
Net debt(11) 317.5 304.3 4.4%
Employees(12) 1,761 1,730 1.8%
and discontinuation of operations
2 Revenue less cost of sales
3 Earnings before interest, taxes, depreciation and amortization adjusted
for exceptional items
4 Earnings before interest and taxes adjusted for exceptional items,
amortization of acquired advertising concessions and impairment losses on
intangible assets
5 Adjusted EBIT before non-controlling interests net of the financial
result adjusted for exceptional items and the normalized tax expense
6 Adjusted profit or loss for the period net of non-controlling interests
divided by the number of shares outstanding after the IPO (42,098,238)
7 Profit or loss for the period before non-controlling interests
8 Actual profit or loss for the period net of non-controlling interests
divided by the number of shares outstanding after the IPO (42,098,238)
9 Including cash paid for investments in property, plant and equipment and
in intangible assets but excluding cash paid for investments in non-current
financial assets and cash paid for the acquisition of consolidated entities
10 Cash?ows from operating activities less cash?ows from investing
activities
11 Financial liabilities less derivative financial instruments and cash
12 Headcount (full and part-time employees)
Financial figures of the segments
Ströer Germany
in EUR m Change ChangeStröer Turkey
9M 2012 9M 2011 in EUR m in %
Revenue 293.4 307.7 -14.3 -4.6%
Billboard 122.7 134.9 -12.2 -9.0%
Street furniture 86.0 89.1 -3.1 -3.5%
Transport 61.2 60.1 1.1 1.8
Other 23.7 23.7 -0.1 -0.3%
Organic growth -5.2% 7.4% n.d.
Operational EBITDA 61.0 77.2 -16.2 -21.0%
Operational EBITDA margin 20.8% 25.1% -4.3% points
in EUR m Change ChangeOther
9M 2012 9M 2011 in EUR m in %
Revenue 62.9 64.0 -1.0 -1.6%
Billboard 46.3 46.8 -0.5 -1.0%
Street furniture 16.3 16.4 0.0 -0.1%
Transport 0.1 0.8 -0.7 -83.4%
Organic growth -3.2% 2.9% n.d.
Operational EBITDA 1.4 10.9 -9.5 -86.8%
Operational EBITDA margin 2.3% 17.0% -14.8% points
in EUR m Change ChangeNote: all figures are rounded
9M 2012 9M 2011 in EUR m in %
Revenue 41.2 45.1 -3.9 -8.6%
Billboard 38.7 41.8 -3.1 -7.4%
Street furniture 0.4 0.4 0.0 -3.3%
Transport 0.5 0.3 0.3>100%
Other 1.7 2.7 -1.1 -39.1%
Organic growth -7.4% -2.1% -5.3% points
Operational EBITDA 1.5 3.2 -1.7 -52.7%
Operational EBITDA margin 3.7% 7.0% -3.4% points
About Ströer
Ströer Out-of-Home Media AG, Cologne, together with its subsidiaries,
specializes in all forms of out-of-home advertising media, from traditional
posters and advertising at bus and tram stop shelters and on vehicles,
through to sophisticated digital out-of-home advertising media. The Group
commercializes more than 280,000 advertising faces and, with consolidated
revenue of EUR 577.1m for fiscal year 2011, is one of the leading
out-of-home advertising companies in Germany, Turkey and Poland. In terms
of revenue, Ströer is one of Europe's largest providers of out-of-home
advertising.
The advertising media portfolio of the Cologne-based SDAX-listed company
comprises digital moving-picture networks in Germany's largest train
stations, in underground and suburban railway stations and in the country's
largest shopping malls.
In addition, Ströer boasts a broad offering of out-of-home advertising
products that set new standards in terms of the quality, innovation and
design of advertising media and street furniture. Ströer's street furniture
has won 27 international awards. The Ströer Group has approximately 1,700
employees at over 70 locations.
For more information on the Company, please visit www.stroeer.de.
Press contact:
Claudia Fasse
Ströer Out-of-Home Media AG
Director Group Communication
Ströer Allee 1
D-50999 Cologne
Phone: +49 (0)2236 / 96 45-246
Fax: +49 (0)2236 / 96 45-6246
Mail: cfasse(at)stroeer.de
IR contact:
Stefan Hütwohl
Ströer Out-of-Home Media AG
Director Group Finance and Investor Relations
Ströer Allee 1
D-50999 Cologne
Phone: +49 (0)2236 / 96 45-338
Fax: +49 (0)2236 / 96 45-6338
Mail: ir(at)stroeer.de
End of Corporate News
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Language: English
Company: Ströer Out-of-Home Media AG
Ströer Allee 1
50999 Köln
Germany
Phone: +49 (0)2236.96 45 0
Fax: +49 (0)2236.96 45 299
E-mail: info(at)stroeer.com
Internet: www.stroeer.de
ISIN: DE0007493991
WKN: 749399
Indices: SDAX
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, Hamburg, München,
Stuttgart
End of News DGAP News-Service
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