OUTFRONT’S Strategic Roadmap: Navigating Challenges and Growth in 2023

In a recent article from Billboard Insider OUTFRONT’s CEO, Jeremy Male, outlined the company’s plan for the rest of the year at the Citi 2023 Global Tech Conference.

The key points of their strategy are:

Growing Transit Business: aims to revitalize its transit business, which has faced challenges. They plan to achieve this by connecting their digital transit assets to programmatic platforms. The company is focused on amending their transit agreements, especially with significant partners like the NYC Subway (MTA – Metropolitan Transportation Authority).

Cost Reduction: expenses are being closely monitored, particularly their SG&A (Sales, General, and Administrative) costs, with the goal of reducing these costs as a percentage of revenue in preparation for 2024.

Challenging Ad Market: The advertising market is not performing exceptionally well. Growth projections are modest, with some sectors, like TV and tech, experiencing declines, while others, like legal and health, are doing better.

Digital Conversion Targets: OUTFRONT insists on a minimum 20% Internal Rate of Return (IRR) for digital conversion projects.

Fewer Acquisitions: OUTFRONT has reduced its focus on acquisitions due to changing market conditions, as public multiples have decreased, and private expectations haven’t adjusted accordingly. They plan to concentrate on optimizing existing assets, but remain open to promising opportunities.

Debt Reduction: to decrease its Debt/Cashflow ratio to 4:1. Their leverage is between 5.0 and 5.5, and their primary objective is to bring it below 5:1 and eventually move towards 4:1.