oOh! Media profits hit as sales rise
Outdoor giant oOh! Media is blaming the subdued economic activity around the May election for a 24 per cent slump in its profits in its first half results.
Its pro forma revenue rose five per cent to $304.9m, with its Commute business delivering a strong contribution with 13 per cent revenue growth; it continues to perform ahead of the acquisition business case.
Underlying EBITDA $56m was down by 4 per cent, while underlying net profit after tax of $9m was down by 24 per cent.
The company owns pioneering wide format print business Cactus Imaging, which invested strongly in equipment during the year.
CEO of oOh! Media Brendon Cook said the result underscored the importance of oOh!’s diversification strategy, lifting revenue in a period when external factors slowed advertising spending. He said, “The diversity and scale of oOh!’s multi-platform portfolio delivered a solid performance in the half despite the external conditions.
“Growth in our key portfolio products, excluding Road, helped lift revenue by 5 per cent on a pro forma basis. This was driven by a notable contribution from Commute, ongoing growth in our Fly and Locate products, and an improvement in Retail.”
Cook added, “The top line performance was impacted by subdued trading during the May federal election and the accompanying softer macroeconomic environment. This negatively affected the performance of Road in particular. Our gross profit was also impacted by the product mix.”
Road revenue was down by 9 per cent, but Commute rose by 13 per cent, while Retail grew by 6 per cent, a turnaround form the 2 per cent decline in the same period last year. Fly also grew strongly, up by 13 per cent.