Ströer anticipating consolidated revenue of EUR 1.5b and operational EBITDA of EUR 370m for 2018
Consolidated revenue increases by 19% from EUR 766m to EUR 910m in the first three quarters of 2017
Operational EBITDA increases by 18% from EUR 178m to EUR 209m in the first nine months of 2017
Ströer widens its financial leeway with a note loan for EUR 350m
Cologne, 10 November 2017 Ströer SE & Co. KGaA performed very well again in the third quarter of 2017 and is continuing on its road to long-term success. Revenue climbed 19% from EUR 766m to EUR 910m in the first nine months and increased organic growth of 8.5%. Operational EBITDA grew by a substantial 18% in the first three quarters of 2017, up from EUR 178m to EUR 209m. Adjusted profit for the period developed positively, up 20% from EUR 89m to EUR 107m. At the same time, the leverage ratio rose slightly from 1.5 in the prior-year period to 1.7 in the third quarter of 2017.
Ströer also successfully placed a note loan with terms of up to seven years and both fixed and variable interest on a broad base of German and international investors. Strong investor demand resulted in an increase of the originally planned volume of EUR 150m to EUR 350m. The proceeds will be used for the Group's general financing requirements and to repay the syndicated bank loan. By taking this step, Ströer has taken advantage of the favorable conditions on the capital market and has optimized its own maturity structure and further diversified its investor base.
"Ströer's performance has been excellent in the first nine months. We have posted strong increases in revenue and earnings. All segments contributed to this positive development," says Udo Müller, founder and Co-CEO of Ströer. "After a
very strong third quarter, we expect a good performance for the rest of the year," adds Christian Schmalzl, Co-CEO of Ströer. "We also anticipate more profitable growth in 2018: we are projecting consolidated revenue of EUR 1.5b, organic revenue growth of 5% to 10% and operational EBITDA of EUR 370m. These figures are further indication that we are on the right track in terms of our strategy."
Operating segments
Ströer Digital
The Ströer Digital segment increased its revenue by 41% from EUR 333m to EUR 469m in the first nine months of 2017 with organic growth of 11.9%. Investments in digital business models (e.g., subscription and e-commerce models) also contributed to the strong revenue growth. The revenue included in the third quarter for the first time from our new dialog marketing business was allocated to this segment. Furthermore, the expansion of our sales operations for local digital solutions geared to small and medium- sized companies also significantly boosted growth.
Operational EBITDA also developed very well and soared 30% from EUR 90m to EUR 117m.
As Ströer is continually adding to and expanding its business, the segment figures can only be compared with those of the prior year to a limited extent. The integration and targeted restructuring of the newly acquired companies was driven forward in the reporting period and we are frequently able to leverage synergies and economies of scale on both the revenue and cost side.
Out-of-Home Germany
The OOH Germany segment reported a sharp rise in revenue once again in the third quarter of 2017, with business with both national as well as regional customers contributing to this positive development.
The segment reported organic revenue growth of 7%, up from EUR 353m to EUR 377m in the first three quarters. Operational EBITDA grew even more strongly, rising by 11% from EUR 91m to EUR 101m.
Out-of-Home International
The OOH International segment includes the Turkish and Polish out-of-home activities and the western European giant poster business of the BlowUP group.
Revenue in the OOH International segment in the first three quarters of 2017 remained shaped by the tense political situation and the unfavorable macroeconomic conditions in Turkey. The Turkish advertising market has come under pressure, and the Turkish lira's losses have also deepened compared to the prior year. Both effects had an adverse impact on revenue shown in euro terms. The BlowUP Group successfully expanded its business activities in the first nine months of this year achieving significant growth.
Overall, due to the significant burdens associated with the Turkish business, the segment reported a 14% decline in revenue from EUR 98m to EUR 85m. Operational EBITDA decreased accordingly, down from EUR 12m to EUR 9m.
The Group's financial figures at a glance
REVENUE OPERATIONAL EBITDA OPERATIONAL EBITDA MARGIN
EUR 909.5m(prior year: EUR 765.7m)
EUR 208.9m 22.7%(prior year: EUR 177.8m) (prior year: 22.9%)
SEGMENT REVENUE
In EUR m
469.3
333.4352.8
377.3
2016
2017
ORGANIC REVENUE GROWTH ADJUSTED CONSOLIDATED
PROFIT FOR THE PERIOD
8.5% EUR 107.1m(prior year: 7.4%) (prior year: EUR 89.3m)
98.1 84.8
FREE CASH-FLOW BEFORE M&A TRANSACTIONS
ROCE
DIGITAL OOHGERMANY
OOH
INTER NATIONAL
EUR 40.3m 16.1%(prior year: EUR 52.4m) (prior year: 18.2%)
In EUR m | Q3 2017 | Q3 2016 | 9M 2017 | 9M 2016 |
Revenue | 312.1 | 263.3 | 909.5 | 765.7 |
Operational EBITDA | 73.0 | 62.4 | 208.9 | 177.8 |
Adjustment effects | 5.5 | 5.4 | 16.3 | 16.3 |
IFRS 11 adjustment | 1.2 | 1.0 | 3.6 | 3.1 |
EBITDA | 66.4 | 56.0 | 189.1 | 158.4 |
Amortization, depreciation and impairment losses | 41.0 | 41.8 | 121.7 | 110.2 |
thereof attributale to purchase price allocations and impairment losses | 14.3 | 16.2 | 47.3 | 46.9 |
EBIT | 25.3 | 14.2 | 67.4 | 48.2 |
Financial result | 2.5 | 2.5 | 6.1 | 7.5 |
EBT | 22.8 | 11.7 | 61.3 | 40.6 |
Income taxes | 3.6 | 1.3 | 8.5 | 4.4 |
Consolidated profit for the period | 19.2 | 10.4 | 52.7 | 36.2 |
Adjusted consolidated profit for the period | 37.0 | 28.0 | 107.1 | 89.3 |
Free cash flow (before M&A transactions) | 40.3 | 52.4 | ||
Net debt | 541.2 | 405.3 | ||
Leverage ratio | 1.72 | 1.53 |
Stroeer SE & Co. KGaA published this content on 10 November 2017 and is solely responsible for the information contained herein.
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