JCDecaux DOOH growth hits 79.6% as programmatic revenue doubles
Commenting on the 2022 first half-year results, Jean-Charles Decaux, Chairman of the Executive Board and Co-CEO of JCDecaux, said:
“Our H1 2022 group revenue grew by +36.3%, +31.7% on an organic basis, to reach €1,474.8 million, including +21.6% on an organic basis in Q2 2022, above our expectations, thanks to a strong trading momentum in most geographies and despite the significant impact of temporary mobility restrictions in China. Our organic revenue growth outside China reached +43.1% in H1 2022 and +34.7% in Q2 2022. This performance has been driven by the strong growth of digital and the strong recovery of our roadside activities especially Street Furniture which was already back to pre-Covid revenue levels in H1, while Transport remained impacted by mobility restrictions, including major lockdowns in China.
Digital Out Of Home (DOOH) grew strongly at +79.6% in H1 2022, +72.0% on an organic basis, to reach 30.0% of Group revenue vs 22.8% in H1 2021. Our programmatic advertising revenue more than doubled vs the same period last year through the VIOOH SSP (Supply Side Platform), the most connected of the OOH industry, which offers DOOH inventory from JCDecaux for 17 countries now, including Brazil since June, as well as from other OOH media owners. We have concluded in July a strategic alliance including the acquisition of a majority stake, with Displayce, a leading DSP (Demand Side Platform), that will enable us to offer a full-stack solution, from DSP to SSP, to our clients, while continuing to offer complete and direct access for advertisers and media agencies to all DOOH media by keeping Displayce independent and fully open.
By activity, Street Furniture was strong at +37.6% organically in H1 2022 and was back to H1 2019 levels globally and above in Europe (including France and UK) and in North America; Billboard grew significantly as well at +21.9% organically in H1 2022, above 2019 in Asia-Pacific; Transport grew strongly at +27.3% reflecting the strong return of US air travel at 90% of pre-Covid level with US airport adverting revenue also at 90% of pre-Covid level, in the Middle-East with air travel at 75% of pre-covid levels, our airport advertising revenue being above 90% of pre-Covid levels, but Transport remained meaningfully impacted by mobility restrictions in China and by lower commuter traffic in public transport than pre-pandemic.
All geographies grew strongly in H1 2022 except Asia-Pacific which was down single digit organically due to its Transport exposure and to local mobility restrictions especially in China in Q2.
Our adjusted operating margin has significantly improved by €152.2m to reach €183.6 million, a +484.8% increase year-on-year reflecting a strong operating leverage due to a tight control over our cost base growing at a much slower pace than the revenue growth and despite the negative impact from the decrease of revenue in China year-on-year in Q2. Our other financial performance indicators improved accordingly. With a positive funds from operations at €80.7 million from -€74.4 million in H1 2021 and a tight control over working capital requirements, our Free-Cash Flow improved by €20.1 million. Our net debt decreased by €186.4 million compared to the same period last year to €976.9 million as of June 30th, 2022.
Recognized as best-in-class by extra-financial rating agencies, we have reaffirmed the excellence of our sustainable practices by unveiling in May our ambitious 2030 ESG Strategy. This aims to support the circular economy, promote outdoor advertising as a catalyst for ecological and social transition and work towards the decarbonisation of the economy and society.
As far as Q3 is concerned, organic revenue growth rates continue to be either high single digit or double digit in most countries while in China our advertising revenue remains negatively impacted by mobility restrictions. We now expect an organic revenue growth rate at around +7% with Street Furniture revenue above the same quarter in 2019.
As the most digitised global OOH company with our new data-led audience targeting and programmatic solutions, our well diversified portfolio, our ability to win new contracts, the strength of our balance sheet and the high quality of our teams across the world, we believe we are well positioned to benefit from the rebound. We are more than ever confident in the power of our media in an advertising landscape increasingly fragmented and more and more digital and in the role it will play to drive economic growth as well as positive changes.”
Following the adoptions of IFRS 11 from January 1st, 2014 and IFRS 16 from January 1st, 2019, and in compliance with the AMF’s instructions, the operating data presented below are adjusted:
– to include our prorata share in companies under joint control, regarding IFRS 11,
– to exclude the impact of IFRS 16 on our core business lease agreements (lease agreements of locations for advertising structures excluding real estate and vehicle rental contracts).
Please refer to the paragraph “Adjusted data” on page 5 of this release for the definition of adjusted data and reconciliation with IFRS.
The values shown in the tables are generally expressed in millions of euros. The sum of the rounded amounts or variations calculations may differ, albeit to an insignificant extent, from the reported values.
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Source: JCDecaux
