OUTFRONT Media Inc.

Ladies and gentlemen, good day and welcome to the first quarter 2021 earnings conference call. At this time, I would like to turn the conference over to Mr. Greg Lundberg. Please go ahead, sir.

Good afternoon, everyone. Thank you for joining our 2021 first quarter earnings call. On the call today are Jeremy Mail, Chairman and Chief Executive Officer, and Matthew Siegel, Executive Vice President and Chief Financial Officer. After a discussion of our financial results, we'll open up the lines for a question and answer session. comments today, as usual, we'll refer to the earnings release and a slide presentation that you can find in the investor relations section of our website, outfrontmedia.com. After today's call is concluded, an audio archive will be available there as well. This conference call may include forward-looking statements, relative factors that could cause actual results to differ materially from these forward-looking statements are listed in our earnings materials, in our SEC filings, including our 2020 Form 10-K. and our 10-Q, which should be filed tomorrow. We will refer to certain non-GAAP financial measures on this call, and any references to OIBDA made today will be on an adjusted basis, and reconciliations of OIBDA and other non-GAAP financial measures are in the appendix of the slide presentation, the earnings release, and on our website. And I will now turn the call over to Jeremy, who is sitting right next to me.

Thanks, Greg, and thank you all for joining us today. Yeah, I'm pleased to tell you that I'm sitting here on our Manhattan office with both Matt and Greg, all vaccinated and happy to be putting 2020 and the worst of the pandemic firmly into the rear view. Talking about rear views, before I review the first quarter, I'd like to break the tradition today and look forward instead. So let's begin with our second quarter outlook. Right now, our expectation for the second quarter is for a return to significant growth with total revenues up in the mid to high 40% range. While this is obviously off 2020 pandemic lows, it is a big step forwards towards our record 2019 levels, and we feel increasingly positive about the rest of the year. With that said, Now let's get back to our review of the first quarter, which is summarized on slide three. As we discussed with you in February, our outlook for the first quarter wasn't much different from the fourth quarter because, simply, the country hadn't made substantive progress in terms of vaccinations and reopenings. Total revenues were down 30% at the low end of our guidance range, adjusted for last year's sale of our sports marketing business. It's worth remembering that we had a pretty strong first quarter last year when billboard revenues grew by 8%. While we were able to enjoy some variable expense reduction, the revenue decrease led to a steep decline in both OWBDA and AFFO. Let's turn to slide four, which is a more detailed view of our U.S. media revenues. Billboard revenues were down 17%, while transit revenues were down 67%. Ridership across the country has remained stubbornly low, with rail ridership at around 25% of pre-pandemic levels. But we are now seeing some green shoots. Weekly ridership on the New York City subway, for example, was up around 40% at the end of April, compared to the fourth quarter average. Obviously, not where it needs to be, but it's nice to see that it's starting to move in the right direction. Turning to slide five, you can see that national advertising was down more than local. Part of this is due to the fact that national has historically been more weighted towards transit, and part of it is due to particular advertising categories, most obviously TV, entertainment, movies, travel. And I'll discuss this in more detail later in the call. The absence of these categories also impacted billboard yields. As you can see on slide six, total yields were down 15%, essentially in line with our revenues. Our digital business on slide seven faced some very tough comps. Last year, total digital revenues were up 39% in Q1, with transit up 67% and contributing nearly half the dollar growth. Despite this quarter's decline, it's good to see that digital is holding steady on this proportion of our total revenues, and we expect this to be expanding further as our business rebounds. To complete our revenue picture for the quarter, slide 8 shows our other business, which principally comprises our business in Canada, where revenues declined 27%. This reflects the same market issues we saw in the U.S. and some more significant lockdowns than we've had here. Let me now hand over to Matt to review our first quarter in more detail.