ASX-listed APN Outdoor lost a third of its value - with more than $480 million wiped off its market capitalisation - after the company cut revenue forecasts and warned of weaker conditions in the outdoor advertising market.
"We have seen a significant reduction in market activity in recent weeks for the September to November period which has arisen, at least in part, from a combination of an extended national election process closely followed by the Olympics," the company said in a statement.
APN Outdoor shares dropped 35 per cent to $5.33 on Monday, after the company forecast that revenue for the 12 months to December 31 would rise between six and eight per cent, down from the previous guidance of eight to 11 per cent. The shares dropped despite the out-of-home advertiser lifting its half-year net profit by almost 50 per cent to $19.5 million, thanks to healthy growth in airport and rail markets, and its traditional billboard business.
"The bottom line for us is that the fundamentals of the industry and our business are very sound still," CEO Richard Herring told The Australian Financial Review.
In July, APN Outdoor spent $32 million to acquire competitors Metrospace and iOM and boost its stake in the Queensland and Victorian outdoor markets.
Meanwhile, shares in rival oOh!Media jumped after the outdoor and digital advertiser increased first-half profit 52 per cent to $6.11 million.