Paris, 6 May 2009 – JCDecaux SA (Euronext Paris: DEC), the number one outdoor advertising company in Europe and Asia-Pacific and the number two worldwide, announced today its revenues for the three months ended 31 March, 2009. On a reported basis, revenues decreased by 11.9% to €424.6 million compared to €482.2 million in the same period last year. Excluding acquisitions and the impact of foreign exchange, organic revenues decreased by 11.9%, reflecting unprecedented economic conditions for the three divisions and most geographies of the Group and the comparable growth of 6.9% in the first quarter of 2008. Core advertising revenues, excluding revenues related to the sale, rental and maintenance of street furniture products, decreased by 12.3% organically.
| Reported growth (%)
| Street Furniture
(1) excluding acquisitions/divestitures and the impact of foreign exchange
Street Furniture revenues decreased by 16.8% to €198.6 million from €238.6 million in the first quarter of 2008. Excluding acquisitions and the impact of foreign exchange, organic revenues decreased by 14.0% over the period. Core organic advertising revenues, excluding revenues related to the sale, rental and maintenance of street furniture products, decreased by 15.9%.
Negative organic revenue growth was recorded in most developed markets as demand reduced, leading to lower occupancy rates and pricing pressure from other media, particularly television. France reported a revenue decrease in the first quarter somewhat better than the division’s average while the United Kingdom experienced a mid single-digit organic revenue decrease reflecting a more favourable 2008 comparable. Some other Street Furniture markets - including Spain, Germany and North America - recorded double-digit negative organic revenue growth in the first quarter of 2009 due to extremely challenging market conditions and a very high 2008 comparable for North America. Positive organic revenue growth was recorded in smaller markets, such as Belgium and Luxembourg, and the Middle East once again achieved a very good performance over the quarter.
Transport revenues rose by 2.1% to €137.5 million from €134.7 million in the first quarter of last year. Excluding acquisitions and the impact of foreign exchange, organic revenues decreased by 4.7% on the back of a double digit organic revenue decrease in March following slightly positive performances in the first two months of 2009.
Most European markets recorded double-digit organic revenue decreases during the first quarter of 2009 due to lower airport passenger traffic and adverse advertising conditions with Spain being particularly difficult over the quarter. Asia-Pacific overall recorded a double digit-organic revenue decrease due to tough trading conditions in March in China and very high comparables in 2008. The revenues generated by newly operated contracts in the Middle East, Europe and India somewhat offset these organic revenue decreases.
North America recorded a mid-single digit revenue decline thanks to the more longer term contracts and additional assets in the Group’s US airports.
Billboard revenues decreased by 18.7% to €88.5 million from €108.9 million in the same period last year. Excluding acquisitions and the impact of foreign exchange, organic revenues were down by 16.2%.
Market conditions further deteriorated in the first quarter of 2009 leading to weaker demand and subsequent fiercer competition in many markets. France experienced some resilience over the quarter with a low double-digit organic revenue decrease while the United Kingdom and Southern Europe recorded significant double-digit organic revenue decrease. Positive organic revenue growth was recorded in Austria despite a high 2008 comparable.
Commenting on the first quarter revenues and prospects for 2009, Jean-Charles Decaux, Chairman of the Executive Board and Co-Chief Executive Officer, said:
"As previously indicated, our first quarter revenues were strongly impacted by the unprecedented economic downturn which has caused advertisers to significantly reduce their advertising spend. This, combined with the competitive activity of the more structurally challenged media has led to significant volume and price pressure in many of our geographies. Our Billboard business, and for the first time, our Street Furniture business subsequently saw double digit revenue declines, while our Transport division benefited somewhat from newly won contracts.
Visibility remains low and with no improvement expected in the second quarter and, given the strong organic growth achieved in Q2 2008 of 11.8%, we currently anticipate a decrease in organic revenue of around 15% for the first half of 2009. The magnitude of this decline exceeds our previous expectations and, combined with the costs associated with new and recently renewed contracts, will have a significant impact on the Group’s H1 operating margin.
Nevertheless, we remain confident in the structural growth opportunity for the outdoor industry in the medium term. We believe that JCDecaux is increasingly well positioned in this industry and the strength of our balance sheet will allow us to take advantage of market opportunities as they arise. A strong focus on cost reduction and selective capital investment will ensure that JCDecaux’s operating margin and free cash flow generation will clearly benefit from the growth in revenues when economic conditions improve.”
Annual Shareholders Meeting: 13 May 2009
Q2 2009 revenues & half year 2009 results: 31 July 2009 (before market)