PART I Item 1. Business OUTFRONT Media operates as a Real Estate Investment Trust (REIT), primarily providing advertising space on billboards and transit displays across the United States, with a focus on U.S. operations after divesting its Canadian business in 2024. - OUTFRONT Media is a REIT, one of the largest providers of out-of-home advertising in the U.S., with a portfolio of billboard and transit displays in approximately 120 markets20 - On June 7, 2024, the company completed the sale of its Canadian business for C$410.0 million in cash, streamlining its focus on U.S. operations2627 - The company's growth strategy focuses on increasing the number of digital displays, which generate significantly higher revenue and profits than traditional static displays, alongside disciplined revenue management and strategic acquisitions30313334 Revenue Diversification by Industry (2022-2024) | Industry | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Entertainment | 18 % | 20 % | 20 % | | Retail | 12 % | 11 % | 11 % | | Health/Medical | 9 % | 9 % | 9 % | | Legal Services/Lawyers | 8 % | 7 % | 5 % | | Technology | 7 % | 6 % | 8 % | | Other | 56 % | 57 % | 57 % | | Total | 100 % | 100 % | 100 % | Digital Display Metrics (2022-2024) | Year Ended | Total Digital Revenues (in millions) | Total Digital Displays | | :--- | :--- | :--- | | Dec 31, 2024 | $614.3 | 30,323 | | Dec 31, 2023 | $588.3 | 23,885 | | Dec 31, 2022 | $539.9 | 18,046 | - The company built or converted 89 digital billboard displays in the U.S. in 2024 and 6,664 digital transit displays. The average initial investment for a digital billboard display is approximately $250,000484950 - The outdoor advertising industry is subject to significant governmental regulation, including the federal Highway Beautification Act of 1965 (HBA), as well as various state and local sign controls, which impact the construction, modification, and operation of advertising structures6566 Item 1A. Risk Factors The company's primary risks are categorized into business operations, indebtedness, and corporate/REIT structure, encompassing economic sensitivity, intense competition, stringent regulations, and operational challenges. - The business is highly sensitive to declines in advertising expenditures and general economic conditions, particularly in key markets like New York and Los Angeles and industries such as entertainment and retail92 - The company faces intense competition from national operators like Lamar and Clear Channel Outdoor, as well as other media platforms including online, mobile, and social media9697 - Operating the digital display platform, especially for transit partners like the MTA, involves significant costs and execution risks; failure to meet contractual obligations or recover costs could lead to financial liability and impairment charges100101102 - As of December 31, 2024, the company had total indebtedness of approximately $2.5 billion; this substantial debt level could make it difficult to satisfy obligations, fund operations, and react to market changes121123 - The agreements governing the company's debt contain restrictive covenants that limit its ability to incur additional debt, pay dividends beyond the REIT requirement, make certain investments, and sell assets122124 - Failure to maintain qualification as a REIT would subject the company to corporate income taxes, reducing cash available for distribution to stockholders; maintaining REIT status requires distributing at least 90% of taxable income annually, which could constrain capital for growth146149 Item 1B. Unresolved Staff Comments The company reports no unresolved staff comments from the SEC. - None167 Item 1C. Cybersecurity OUTFRONT Media maintains a comprehensive Cybersecurity Program as part of its enterprise risk management, with no material threats or incidents identified to date. - The company has a formal Cybersecurity Program that includes threat identification, incident response planning, and regular third-party assessments168171 - Oversight is provided by the CISO and CIO, who report to the CTO, with the audit committee of the board receiving quarterly updates169 - The company has not identified any cybersecurity threats or incidents that have had or are reasonably likely to have a material effect on the company172 Item 2. Properties The company's principal executive offices and the majority of its outdoor advertising sites are leased, with a significant portion of site leases subject to renewal within the next five years. - The company leases its principal executive offices at 90 Park Avenue, 9th Floor, New York, NY 10016173 - Approximately 72% of outdoor advertising site leases will expire or be subject to renewal in the next 5 years, with an average term of 8 years across the portfolio174 Item 3. Legal Proceedings The company is involved in various lawsuits and governmental proceedings in the ordinary course of business, none of which are expected to have a material adverse effect on its financial position or results of operations. - In management's opinion, none of the company's current litigation is expected to have a material adverse effect on its results of operations, financial position, or cash flows175 Item 4. Mine Safety Disclosures Not applicable. - None176 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities OUTFRONT Media's common stock is traded on the New York Stock Exchange under the ticker symbol "OUT," and as a REIT, the company is required to distribute at least 90% of its taxable income to shareholders annually. - The company's common stock trades on the NYSE under the ticker symbol "OUT."179 - To maintain its REIT status, the company must distribute at least 90% of its REIT taxable income to stockholders annually181 Stock Performance Comparison (Cumulative Total Return) | Company/Index | Dec. 31, 2024 (Value of $100 invested on Dec 31, 2019) | | :--- | :--- | | OUTFRONT Media Inc. | $86.90 | | Lamar Advertising Company | $170.55 | | Clear Channel Outdoor Holdings, Inc. | $47.90 | | S&P 500 | $197.02 | | FTSE NAREIT All Equity REITs Index | $117.56 | Item 6. [Reserved] This item is reserved. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations In fiscal year 2024, total revenues increased by 1% to $1.83 billion, with organic revenues growing 4%, and operating income turning around significantly to $425.5 million from a prior-year loss, driven by lower impairment charges and a gain on the Canadian business sale. Key Performance Indicators (2024 vs. 2023) | (in millions) | 2024 | 2023 | % Change | | :--- | :--- | :--- | :--- | | Revenues | $1,830.9 | $1,820.6 | 1% | | Organic revenues | $1,796.0 | $1,728.5 | 4% | | Operating income (loss) | $425.5 | $(253.2) | N/A | | Adjusted OIBDA | $464.8 | $456.2 | 2% | | Net income (loss) | $258.2 | $(425.2) | N/A | | AFFO | $307.5 | $275.8 | 11% | - The company recorded impairment charges of $17.9 million in 2024, a significant decrease from $534.7 million in 2023, primarily related to the MTA asset group231232 - A net gain on dispositions of $160.9 million was recognized in 2024, largely due to the sale of the Canadian business, compared to a $14.2 million gain in 2023230 - Billboard segment revenues increased 3% to $1.41 billion in 2024, with Adjusted OIBDA up 4% to $520.5 million252254 - Transit segment revenues grew 9% to $383.8 million in 2024; the segment's Adjusted OIBDA improved to $8.3 million from a loss of $16.0 million in 2023, driven by revenue growth and significantly lower impairment charges263264268 - As of December 31, 2024, total debt was approximately $2.5 billion; the company prepaid $200.0 million of its Term Loan in June 2024298299 - The company is in compliance with its debt covenants, reporting a Consolidated Total Leverage Ratio of 4.8 to 1.0 and a Consolidated Net Secured Leverage Ratio of 1.5 to 1.0 as of year-end 2024308309 - Net cash flow from operating activities increased by 18% to $299.2 million in 2024, up from $254.2 million in 2023317318 Item 7A. Quantitative and Qualitative Disclosures About Market Risk The company is exposed to market risks primarily from commodity prices, particularly electricity costs, and interest rates on its variable-rate debt, while credit risk is considered limited. - The company faces commodity price risk from electricity costs, which it partially mitigates through fixed-rate purchase agreements349350 - The company is exposed to interest rate risk on its variable-rate debt; a 0.25% (1/4%) change in the interest rate on its $400.0 million Term Loan would result in an approximate $1.0 million change in annual interest expense351 Item 8. Financial Statements and Supplementary Data This section presents the company's audited consolidated financial statements for 2022-2024, including an unqualified auditor's opinion, detailed notes on accounting policies, and disclosures on the Canadian business sale and a prior period accounting error. - The independent auditor, PricewaterhouseCoopers LLP, issued an unqualified opinion on the consolidated financial statements and the effectiveness of internal control over financial reporting as of December 31, 2024359 Consolidated Statement of Operations Highlights (in millions) | Line Item | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Revenues | $1,830.9 | $1,820.6 | $1,772.1 | | Operating income (loss) | $425.5 | $(253.2) | $282.5 | | Net (gain) loss on dispositions | $(160.9) | $(14.2) | $0.2 | | Impairment charges | $17.9 | $534.7 | $— | | Net income (loss) attributable to OUTFRONT | $258.2 | $(425.2) | $142.7 | | Diluted EPS | $1.51 | $(2.70) | $0.83 | Consolidated Statement of Financial Position Highlights (in millions) | Line Item | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $46.9 | $36.0 | | Total Assets | $5,215.2 | $5,582.9 | | Long-term debt, net | $2,482.5 | $2,676.5 | | Total Liabilities | $4,431.2 | $4,852.8 | | Total Stockholders' Equity | $649.0 | $577.3 | - The company completed the sale of its Canadian Business on June 7, 2024, for C$410.0 million in cash; the assets and liabilities of this business were classified as held for sale as of December 31, 2023500502 - In 2024, the company issued a special dividend of $0.75 per share, paid partially in stock; to offset the dilution, a 1-for-1.024549 reverse stock split was executed on January 17, 2025, with all share and per-share data retroactively adjusted487488589 - Previously issued financial information was revised in Q3 2024 to correct an error in the accounting for redeemable noncontrolling interests and to voluntarily reflect a previously disclosed out-of-period adjustment for variable lease costs393576577 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure The company reports no changes in or disagreements with its accountants on accounting and financial disclosure. - None615 Item 9A. Controls and Procedures Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures and internal control over financial reporting were effective as of December 31, 2024. - The CEO and CFO concluded that disclosure controls and procedures were effective as of the end of the period covered by the report616 - Management concluded that the company's internal control over financial reporting was effective as of December 31, 2024617 Item 9B. Other Information The company reports no other information. - None619 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections This item is not applicable to the company. - Not applicable620 PART III Item 10. Directors, Executive Officers and Corporate Governance Information regarding directors, executive officers, and corporate governance is incorporated by reference from the company's Proxy Statement for the 2025 Annual Meeting of Stockholders. - The information required by this item is incorporated by reference to the company's Proxy Statement for the 2025 Annual Meeting of Stockholders625 Item 11. Executive Compensation Information regarding executive compensation is incorporated by reference from the company's Proxy Statement for the 2025 Annual Meeting of Stockholders. - The information required by this item is incorporated by reference to the company's Proxy Statement for the 2025 Annual Meeting of Stockholders626 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Information regarding security ownership is incorporated by reference from the company's Proxy Statement for the 2025 Annual Meeting of Stockholders. - The information required by this item is incorporated by reference to the company's Proxy Statement for the 2025 Annual Meeting of Stockholders627 Item 13. Certain Relationships and Related Transactions, and Director Independence Information regarding certain relationships, related transactions, and director independence is incorporated by reference from the company's Proxy Statement for the 2025 Annual Meeting of Stockholders. - The information required by this item is incorporated by reference to the company's Proxy Statement for the 2025 Annual Meeting of Stockholders628 Item 14. Principal Accounting Fees and Services Information regarding principal accounting fees and services is incorporated by reference from the company's Proxy Statement for the 2025 Annual Meeting of Stockholders. - The information required by this item is incorporated by reference to the company's Proxy Statement for the 2025 Annual Meeting of Stockholders629 PART IV Item 15. Exhibits, Financial Statement Schedules This section lists the financial statements, financial statement schedules, and exhibits filed as part of the Annual Report on Form 10-K. - This item lists the financial statements, schedules, and exhibits included in the Form 10-K filing631 Item 16. Form 10-K Summary The company provides no summary for its Form 10-K. - None646
OUTFRONT Media(OUT) - 2024 Q4 - Annual Report