JCDecaux SA, the number one outdoor advertising company worldwide, announced its 2021 half-year financial results in which the group revenue reached €1,082.3 million, a +0.6% YoY revenue growth thanks to a strong street furniture revenue growth across all geographies, notably in Europe.
In the second quarter, adjusted revenue increased by 78.5% to €628.1 million. On an organic basis, adjusted revenue increased by 80.2% compared to Q2 2020. Adjusted advertising revenue, excluding revenue related to sale, rental and maintenance of street furniture and advertising displays, increased by 86.3% on an organic basis in Q2 2021.
Despite JCDecaux limited revenue growth of €6.9m in H1 2021, its adjusted operating margin has greatly improved (by €93.2m), turning positive at €31.4 million vs -€61.8 million in H1 2020 thanks to a revenue mix geared toward the higher-margin Street Furniture business segment and to their ongoing cost reduction actions, including rent reliefs, staff cost optimisation and overheads management.
The company’s tight control over working capital requirements and selective capex reduction as well as the decision not to distribute dividends for the second year in a row allowed us to contain free-cash-flow at -€63.2m in H1 2021 and net debt at around €1.2bn at the end of the period.
First-half adjusted revenue for Billboard increased by 5.7% to €182.4 million, 10.9% on an organic basis. All regions have been positive, Asia-Pacific and North America experienced the strongest rebounds in line with the pick-up of vehicular audiences.
In the second quarter, adjusted revenue increased by 83.8% to €103.4 million. On an organic basis, adjusted revenue increased by 86.4% compared to the same period last year with Asia-Pacific, UK and North America being the strongest rebounds.
While the first quarter of 2021 was highly impacted by strict Covid-19 restrictions around the world, the outdoor advertising company’s Street Furniture and Billboard activities have significantly rebounded in the second quarter along with the urban audience recovery as stay-at-home requirements were progressively lifted.
Digital Out Of Home (DOOH) represents now 22.8% of total group revenue with very positive momentum for our programmatic advertising trading. The VIOOH platform which is the most connected DOOH supply-side platform is now active in 13 countries following its launch in Australia and in France.
Street Furniture: In the first half of 2021, the adjusted operating margin increased by €70.2 million to €49.6 million. As a percentage of revenue, the adjusted operating margin was 8.8%, +1,310bp above prior year.
Transport: In the first half of 2021, the adjusted operating margin improved by €1.3 million while the revenue declined by €84.6 million thanks to our saving actions implemented since the beginning of the pandemic. As a percentage of revenue, the adjusted operating margin was limited to -3.0%, -30bp below prior year.
Billboard: In the first half of 2021, the adjusted operating margin improved by €21.8 million. As a percentage of revenue, the adjusted operating margin was -4.5%, +1,290bp above prior year.
Commenting on the 2021 first half-year results, Jean-François Decaux, Chairman of the Executive Board and Co-CEO of JCDecaux, said:
As far as Q3 2021 is concerned, although the global advertising market remains highly volatile with low visibility and with some depressed audience levels which might take time to recover such as international air traffic and mass transit, we now expect an adjusted organic revenue growth above +20% yoy based on positive trends in our current trading with some activities close to pre-covid levels, provided that mobility restrictions do not rise significantly.
I would like to sincerely thank our teams across the world for their strong commitment, resilience, their agility and their innovative spirit.
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 support the economic recovery as well as to drive positive changes.”