Russ Curry, Ministry of New Media
JCDecaux SA (Euronext Paris: DEC), the number one outdoor advertising company worldwide, announced today its results for the year ended December 31st, 2021. JCDecaux Supervisory Board, which met on March 9, 2022, approved the audited financial statements for fiscal year 2021.
Commenting on the 2021 results, Jean-François Decaux, Chairman of the Executive Board and Co-CEO of JCDecaux, said “Our 2021 group revenue grew by +18.7%, +18.5% on an organic basis with a very strong digital revenue growth, to reach €2,744.6 million despite national and local mobility restrictions including semi-lockdowns in some European and Asia-Pacific countries.
Digital Out Of Home (DOOH) grew by +33.2% in full-year 2021 to reach a record 26.9% of Group revenue for 2021 as we continued to accelerate our digital transformation and maintained our focus on the roll-out of digital screens and on the development of our automated data-driven planning and trading solutions. Programmatic advertising gained good momentum via the VIOOH platform which is now trading in 15 countries, connected to multiple DSPs (Demand Side Platforms).
While our client portfolio is diversified with the top 10 clients representing c.13% of our revenue, internet companies increased their spend by 69.4% representing now 7.3% of total revenue and our biggest category is now Fashion/Personal care and Luxury Goods with 15.0% of total revenue ahead of retail at 14.6%.
With revenue growing by €432.8m in 2021, our adjusted operating margin has reached €422.3m improving by €280.6m reflecting a strong operating leverage thanks to a revenue mix geared toward the higher margin Street Furniture business segment, our ongoing strict cost control and some rent relieves in line with the revenue shortfall linked to Covid-19 restrictions. Although improving by €590m year-on-year, our net result group share is still slightly negative at -€14.5m. Our tight management over working capital requirements and selective capex reduction as well as the decision not to distribute dividends allowed us to generate an improved positive free-cash-flow at €211.5m in 2021 and to reduce our net debt at around €925m at the end of the period (vs €1,086m at the end of 2020).
We continued to strengthen our ESG leading initiatives and commitments such as our global carbon neutrality contribution with France as a first step from 2021 onwards. The acknowledgement of our sustainability strategy by extra-financial rating agencies such as our A Leadership ranking in the Carbon Disclosure Project (CDP) and our new Gold Medal status by EcoVadis demonstrates the excellence of our environmental, social and governance practices which have been in our DNA since the company was created, as well as our ongoing commitment to ensuring transparency towards our stakeholders.
In order to continue to optimize our financial flexibility, we will propose at the Annual General Meeting which will take place on May 11th, 2022, not to pay any dividend in 2022.
As far as Q1 2022 is concerned, we expect an organic revenue growth of above +40% driven by Europe, UK, US, Rest of the World while Asia-Pacific revenue growth is lower due to ongoing mobility restrictions. Our digital revenue growth continues to be very strong while analogue growth remains robust.
I would like once again to sincerely thank our teams across the world for their hard work, their strong commitment, their resilience, their agility, and their innovation spirit.
The Executive Board decided to immediately put in place financial and other measures to support the Ukrainian people as well as our local staff of the BigBoard JV suffering from the disastrous humanitarian consequences caused by the war against their country. JCDecaux has no exposure in Russia since the sale of its 25% stake in Russ Outdoor in 2020. Revenue in Ukraine in Q4 2021 accounted for c. 0.1% of total revenue.
As the most digitised global OOH company with our new data-led audience targeting and programmatic solutions, our well diversified portfolio, our ability to win new contracts, the strength of our balance sheet and the high quality of our teams across the world, we believe we are well positioned to benefit from the rebound. We are more than ever confident in the power of our media in an advertising landscape increasingly fragmented and more and more digital and in the role it will play to support the economic recovery as well as to drive positive changes.”
As reported on January 2, 2022, adjusted revenue increased by +18.7% to €2,744.6 million compared to €2,311.8 million in 2020, with a strong sequential revenue rebound when restrictions are lifted. Excluding the positive impact from foreign exchange variations and the negative impact from changes in perimeter, adjusted organic revenue increased by +18.5%. Adjusted organic advertising revenue, excluding revenue related to sale, rental and maintenance of street furniture and advertising displays, increased by +18.9% in 2021.
By activity, Street Furniture rebounded the most followed by Billboard and Transport. Pedestrian and car traffic audiences recovered rapidly when lockdowns were lifted while for Transport international air traffic remained low throughout the year due to the Covid19 pandemic. Public transport assets remained temporarily affected by local mobility restrictions.
All geographies performed strongly in 2021 compared to 2020, especially in Q4 despite Omicron and mobility restrictions in some countries. Rest of the World improved the most, from a low level in 2020 while Europe (including France and UK) was the closest to 2019 levels as Street Furniture performed well. For Transport, in China, businesses exposed to domestic audiences recovered well as revenues were close to pre-Covid levels for domestic transport advertising (including metros, buses, domestic airport terminals) and already above 2019 revenue levels for domestic airport advertising more specifically.
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