Ooh Media Ltd · ASX:OML
Ooh Media — FY2023 Earnings Presentation
44 slides from Ooh Media's earnings presentation, Feb 19, 2024
Slide 1: Full Year Results Presentation (ASX Release)
oOh!media Limited ABN 69 602 195 380 19 February 2024 ASX Release FULL YEAR RESULTS PRESENTATION oOh!media Limited (ASX:OML) (oOh!) in accordance with ASX Listing Rules attaches the 2023 Full Year presentation. This announcement has been authorised for release to the ASX by the Chief Executive Offic
Slide 2: Full Year 2023 Results
Full Year 2023 Results 19 February 2024
Slide 3: Agenda
Agenda Presenters: Cathy O’Connor (CEO) and Chris Roberts (CFO) • CY2023 Highlights • Financials & Commercial Contracts • Market growth and reooh • Outlook and wrap up • Questions 2.
Slide 4: CY2023 Highlights
CY2023 Highlights 3.
Slide 5: oOh!'s strategic pillars
oOh!’s strategic pillars 01 03 Make it easy for our Lead Out of Home to customers to achieve a digital first future better outcomes 02 04 Deliver above market Capture audience growth through attention in public expansion into Retail spaces at scale Media 4.
Slide 6: 2023 Results in Focus
2023 Results in Focus Adjusted EBITDA oOh! revenue grew 7% up 2% to $130M, driven by strong Road with disciplined margin Out of Home was performance and cost control the top performing media sector1, taking record agency media share of 14.5% NSW contract wins – $30m in annualised First reooh custome
Slide 7: 2023 Highlights
2023 Highlights Strong financial Key contract reooh growth ESG result wins opportunity achievements • Revenue up 7%, while SMI • New NSW commercial • Investing in rapidly • 10,200 advertising panels reported all media agency contracts with greenfield growing Retail Media on renewable power revenue d
Slide 8: Progress across our purpose and strategic pillars
Progress across our purpose and strategic pillars 50 3D Anamorphic campaigns (+28% YoY New and upgraded increase) small format digital screens across 93 bus shelters and 44 retail shopping centres Over 300,000 repair and cleaning jobs on bus shelters Installed Australia’s biggest roadside Digital Bi
Slide 9: Progress across our purpose and strategic pillars
Progress across our purpose and strategic pillars 98% growth in 42% increase in brand programmatic penetration from Over 680 new digital revenue customer campaigns sites and panels measured through launched into market oOh! Outcomes (+43% YoY increase) Winner of Media-i Delivered 15,000+ National Sa
Slide 10: CY2023 Key Financials
CY2023 Key Financials oOh! increases adjusted NPAT per share by 6% KEY PERFORMANCE STATUTORY METRICS VS PCP1 METRICS VS PCP1 Revenue Gross Profit 7% (1%) $633.9M $417.8M Adjusted Gross (1.9 Opex Margin2 2% ppts) $140.0M 44.3% Adjusted EBITDA2 EBITDA 2% (3%) $130.2M $278.2M Adjusted NPAT2 NPAT (2%) 1
Slide 11: Growth across all formats drives revenue up 7%
Growth across all formats drives revenue up 7% Market leading performance in Road, with Street & Rail returning to growth in H2 H1 H2 • Revenue growth of 7% compares to 8% OMA market growth CY2023 CY2022 Change (excluding City of Sydney) Formats1 Change Change ($M) ($M) % vs pcp % vs pcp % vs pcp •
Slide 12: Financials & Commercial Contracts
Financials & Commercial Contracts 11 .
Slide 13: Key Financial Highlights
Key Financial Highlights Disciplined cost control driving earnings growth and returns to shareholders 130.2 5.25 46.2% 127.1 4.50 44.3% 44.1% 81.3 59.3 2.5% 42.2% 1.7% 1.00 - CY 2020 CY 2021 CY 2022 CY 2023 CY 2022 CY 2023 CY 2020 CY 2021 CY 2022 CY 2023 CY 2020 CY 2021 CY 2022 CY 2023 Adjusted Gros
Slide 14: Renewed 75% of the large contracts expiring in CY2023
Renewed 75% of the large contracts expiring in CY2023, equating to 65% of revenue • 65% of the CY2022 adjusted revenue1 $85M large contracts expiring in CY23 attached to these contracts was renewed or extended on the existing contract terms beyond 2024 Not • The key contract not renewed was renewed
Slide 15: Pipeline of new tenders and concessions expected in 2024-25
Pipeline of new tenders and concessions oOh!’s strength in winning 120 expected to be awarded in 2024-25 1 and renewing contracts 100 Annualised revenue opportunity ($M) • Market leader with entrenched 80 reputation as a trusted brand with strong customer advocacy 60-80 • Demonstrated capability and
Slide 16: Reduction in commercial contract renewal risk
Reduction in commercial contract renewal risk Adjusted Revenue1 Maturity Profile Near-Term Adjusted Revenue1 350.0 60.0% Expiry Profile2 % of CY23 adjusted revenue CY23 Adjusted revenue $M 300.0 48.4% 300.0 50.0% 50.0% 250.0 45.0% 40.0% 250.0 40.0% 200.0 Adjusted Revenue ($M) % of Adjusted Revenue 3
Slide 17: Market growth & reooh
Market growth & reooh 16 .
Slide 18: Out of Home achieves record 14.5% share of agency media spend
Out of Home achieves record 14.5% share of agency media spend, with Out of Home (OOH) taking share from growth expected to continue • Free to Air TV, driven by Roadside billboards as a substitutable mass-reach medium. This structural change is OOH share of Total Media (SMI) expected to continue into
Slide 19: Agency media revenue growth by segment
Agency media revenue growth by segment1 60% 40% 20% 0% Out of Home Digital Television Radio Newspapers Total Agency Media -20% -40% Out of Home outperforms all -60% Change on 2019 2021 2022 2023 other media sectors 18 . 1. Per the Standard Media Index (SMI)
Slide 20: Out of Home projected to grow over 6% CAGR to $1.9B in 2026
Out of Home projected to grow over 6% CAGR to $1.9B in 2026 High case 12.8% CAGR 2023-26 Underpinned by traditional media share shifting Base case to Digital and Out of Home 6.1% CAGR 2023-26 Out of Home growth will continue to OOH spend in ANZ1 capture the spend shift from traditional 2.5 media thr
Slide 21: .
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Slide 22: Retail Media to be the 3rd big wave in digital advertising
Retail Media to be the 3rd big wave in digital advertising • Morgan Stanley forecasts the Australian Retail Media market to reach ~A$2.8bn by 2027e • In-Store Retail Media is predicted to be the next growth frontier with significant majority of transactions still taking place in-store environments 2
Slide 23: reooh enables retailers to harness the power of oOh!
reooh enables retailers to harness the power of oOh! 1. 2. 3. 4. Minimal Provide non- Minimise risk Accelerate go core capital outlay Financial, to market capability cybersecurity, scope- Initial capex to fund a creep and speed to Valuation, product and screen network is Out of Home media market all
Slide 24: reooh's first customers seeing strong returns
reooh’s foundation customer, The Warehouse Group reooh’s first customers (NZ), is expanding on its success to date seeing strong returns One major Australian retailer signing on for pilot program in Q1 2024 and potential for further conversion 23 .
Slide 25: Why this is attractive to oOh!
Why this is attractive to oOh! 1. 2. 3. 4. Delivers Brings Opens a new Closely profitable ARR advertisers demand source adjacent New Annual Recurring closer to the for oOh! to core Revenue profile for oOh! with long-term service cash register Access to incremental Competency and trade ad budgets for
Slide 26: ESG commitments
ESG commitments oOh! is committed to reducing operational impact on the planet and providing a safe supportive and inclusive environment for our people and communities. Our strategy is a result of: 1. What our stakeholders care about What Business • Safety and Wellbeing Our Strategy stakeholders Opp
Slide 27: Outlook
Outlook 26 .
Slide 28: Outlook
Outlook • Out of Home expected to continue taking revenue share from other media sectors, and expecting mid to high single digit revenue growth for CY2024 • Major advertising agencies are also expecting similar growth for Out Of Home in CY2024 • oOh!’s Q1 media revenue pacing1 is indicating a flat r
Slide 29: Wrap Up
Wrap Up Strong financial result in CY2023 • Revenue growth of 7% Focus on growth through innovation • Adjusted NPAT per share up 6% • Investment in fast- growing retail media • Full year dividend up 17% market through reooh • Gearing at 0.6x adjusted EBITDA Continued disciplined Structural growth of
Slide 30: Questions
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Slide 31: Appendix
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Slide 32: Advertising category performance - SMI
Advertising category performance - SMI1 CY 2023 SMI category share for Out of Home SMI Agency Spend CY 2023 Pacing vs CY 2022 -40% -30% -20% -10% 0% 10% 20% 30% 40% 50% 60% 9% Retail Retail 6% Alcoholic Beverages Automotive Brand Automotive Brand 6% Insurance Food/Produce/Dairy 42% Restaurants Resta
Slide 33: Reconciliation OMA revenue growth to oOh! revenue growth
Reconciliation OMA revenue growth to oOh! revenue growth 32 .
Slide 34: Adjusted Profit & Loss
Adjusted Profit & Loss • Gross margin declined 1.9 ppts to 44.3% due to a step up in fixed oOh! delivered a 6% improvement in adjusted NPAT per share rents upon renewal of some larger contract renewals during late CY2022, higher variable rent, lower fixed rent abatements, and ADJUSTED P&L1 CY2023 ($
Slide 35: Reported Profit & Loss
Reported Profit & Loss Net Profit After Tax grew by 10% to $34.6M REPORTED P&L CY2023 ($M) CY2022 ($M) Change ($M) Revenue 633.9 592.6 41.3 Cost of media sites and production (216.2) (169.9) (46.3) Gross profit 417.8 422.8 (5.0) Gross profit margin (%) 65.9% 71.3% (5.4 ppts1) • Gross profit margin d
Slide 36: Cash Flow
Cash Flow Increase in capex for roll out assets for new concessions and further digitisation opportunities Cash flows1 CY2023 ($M) CY2022 ($M) Change ($M) • A 47% increase in capex as approval and supply chain delays Adjusted EBITDA 130.2 127.1 3.1 • Free cash flow decline of $22.3M largely attribut
Slide 37: Balance Sheet
Balance Sheet Financial position remains strong following share buy back 31 Dec 2023 31 Dec 2022 Change Balance sheet1 ($M) ($M) ($M) Cash and cash equivalents 31.6 40.0 (8.4) • Gearing at 0.6x following completion of share buy back Trade and other receivables 117.2 113.0 4.2 • Right of use assets a
Slide 38: COGS bridge
COGS bridge Reduction in rent abatements of $3.6M is the difference between the $10.2M of net abatements received in CY2022 and $6.6M of net abatements in CY2023. The abatements for CY2023 have 37 . not been detailed in the statutory accounts following the expiry of the COVID-19 practical expedient
Slide 39: Opex bridge
38 $M Opex bridge 155.0 150.0 145.0 140.0 135.0 130.0 40 || _ 150.6 (1) (0.3) 3.0 146.9 (2.0) Opex CY 2022 One-off items Loss on sale of assets Labour inflation Marketing spend Other Opex CY 2023 ooh! unmissable
Slide 40: Reported NPAT to Adjusted NPAT reconciliation
Reported NPAT to Adjusted NPAT reconciliation CY2023 CY2022 Change ($M) ($M) ($M) Reported NPAT 34.6 31.5 3.1 AASB 16 income and expense items: Other income (0.5) (2.1) 1.6 Fixed lease obligations (147.6) (158.8) 11.3 Depreciation 123.8 143.9 (20.1) Interest 34.4 33.4 1.1 Tax effect of AASB 16 items
Slide 41: Adjusted vs Reported Results Reconciliation
Adjusted vs Reported Results Reconciliation CY2023 CY2023 Change 1 P&L ADJUSTED ($M) REPORTED ($M) ($m) EBITDA increase of $148M offset by a • Other income includes gains on Depreciation and Amortisation lease modification, which arises Revenue 633.9 633.9 - increase of $124M and an Interest from an
Slide 42: Financial information notice and Glossary
Financial information notice Glossary EBIT Earnings before interest and tax oOh!’s Financial Statements for the year ended Earnings before interest, tax, depreciation 31 December 2023 presented in accordance with EBITDA and amortisation Australian Accounting Standards. NPAT Net profit after tax oOh!
Slide 43: Financial information notice
Financial information notice Financial information notice This document is a presentation of general background information about the activities of Forward looking statements are provided as a general guide only, and should not be relied on as oOh!media Limited (oOh!media or oOh!) current at the dat
Slide 44: Office locations
Sydney T +61 (2) 9927 5555 Level 2, 73 Miller Street North Sydney NSW 2060 Melbourne T +61 (3) 8598 0700 Level 3, 101 Moray Street South Melbourne VIC 3205 Brisbane T +61 (7)3620 2900 2/89 McLachlan Street Fortitude Valley QLD 4006 Adelaide T +61(8)8367 3222 Level 4, 149 Flinders Street Adelaide SA