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Adshel buy boosts oOh!media to record $416 million in revenue

Outdoor advertiser oOh!media posted double-digit revenue growth for 2018, after a strong fourth-quarter contribution from its Commute (formerly Adshel) business. Organic revenue increased by 10% to $416.8 million.

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CEO Brendon Cook said 2018 was a transformational year for the company, which bought Adshel for $570 million in September from Here, There and Everywhere (HT&E).

 “The acquisition of Commute brings the highly complementary segments of street furniture and rail to our portfolio,” said Cook. “This ensures oOh! has the most diverse and integrated national audience delivery network in the industry, extending our audience reach to well above 90% of the Australian population, and the largest coverage in New Zealand.”

The contribution from the Commute business resulted in total revenue increasing by 27% to $482.6 million. Underlying EBITDA increased by 25% to $112.5 million. Net profit after tax was $31.6m, down 4% on CY17 due to acquisition costs.

The company’s Road division continued to deliver double-digit sales growth through its portfolio of digital and classic printed billboards, with revenue up by 13%. The Fly business continued its strong momentum from the first half of the year, with revenue lifting by 23%, including the contribution from QANTAS In-Flight, which was ahead of expectations. 

Retail revenue declined by 2%. An overall 3% decline in Australia was partially offset by double digit growth in New Zealand. 

oOh! arranged $450 million in new debt facilities during the year to refinance existing debt and part fund the acquisition of the Commute business. 

“We continue our investment in our all-of-business operating system,” said Cook. “This is built on advanced machine learning with enhanced technological infrastructure and will enable our clients to leverage our digital sign network and engage with audiences more effectively and efficiently. We expect this investment will deliver significant operating efficiencies to oOh!, including optimised property retention, higher sales and margin, and improvements in our staff to revenue ratio.

Ooh! delivered a fully franked final dividend of 7.5 cents per share, bringing the full year dividend to 11.0 cents.