OUTFRONT Media Inc

Previous wording

COVID-19 pandemic, industry shutdowns or slowdowns (including due to labor strikes), and shifts in market demographics and transportation patterns (including reductions in foot traffic, roadway traffic, commuting, transit ridership and overall target audiences due to remote work, safety concerns or otherwise), as described in this MD&A. These sensitivities may adversely impact our revenues and operating results on a consolidated basis and/or may have a disproportionate adverse impact on one or more of our operating segments, especially our U.S. Transit operating segment.

Current wording

COVID-19 pandemic, industry shutdowns or slowdowns (including due to labor strikes), and shifts in market demographics and transportation patterns (including reductions in foot traffic, roadway traffic, commuting, transit ridership and overall target audiences due to remote work, safety concerns or otherwise), as described in this MD&A. These sensitivities may adversely impact our revenues and operating results on a consolidated basis and/or may have a disproportionate adverse impact on our U.S. transit business within our U.S. Media reportable segment.

Previous wording

Due to the current levels of inflation and commodity prices in the U.S. and abroad, which has resulted in rising interest rates, we have experienced increases with respect to some of our posting, maintenance and other expenses, some of our corporate expenses, and our interest expense, which could have an adverse effect on our business, financial condition and results of operations. Our billboard property lease expenses and transit franchise expenses have been less impacted by the current levels of inflation due to the long-term nature of most of our operating leases and transit franchise agreements. However, our transit franchise agreements that contain inflationary price adjustments may cause increases in our transit franchise expenses in the near-term. Though the Company cannot reasonably estimate the full impact of the current levels of inflation on our business, financial condition and results of operations at this time, a portion of these increases may be partially offset by increases in advertising rates on our displays and cost efficiencies.

Current wording

Due to the current levels of inflation and commodity prices in the U.S. and abroad, which has resulted in elevated interest rates, we have experienced increases with respect to some of our posting, maintenance and other expenses, some of our corporate expenses, and our interest expense, which could have an adverse effect on our business, financial condition and results of operations. Our billboard property lease expenses and transit franchise expenses have been less impacted by the current levels of inflation due to the long-term nature of most of our operating leases and transit franchise agreements. However, our transit franchise agreements that contain inflationary price adjustments may cause increases in our transit franchise expenses in the near-term. Though the Company cannot reasonably estimate the full impact of the current levels of inflation on our business, financial condition and results of operations at this time, a portion of these increases may be partially offset by increases in advertising rates on our displays and cost efficiencies.

Previous wording

Increasing the number of digital displays in our prime audience locations is an important element of our organic growth strategy, as digital displays have the potential to attract additional business from both new and existing customers. We believe digital displays are attractive to our customers because they allow for the development of richer and more visually engaging messages, provide our customers with the flexibility both to target audiences by time of day and to quickly launch new advertising campaigns, and eliminate or greatly reduce print production and installation costs. In addition, digital displays enable us to run multiple advertisements on each display. Digital billboard displays generate approximately four to five times more revenue per display on average than comparable traditional static billboard displays. Digital billboard displays also incur, on average, approximately two to four times more costs, including higher variable costs associated with the increase in revenue than comparable traditional static billboard displays. As a result, digital billboard displays generate higher profits and cash flows than comparable traditional static billboard displays.

Current wording

Increasing the number of digital displays in our prime audience locations is an important element of our organic growth strategy, as digital displays have the potential to attract additional business from both new and existing customers. We believe digital displays are attractive to our customers because they allow for the development of richer and more visually engaging messages, provide our customers with the flexibility both to target audiences and to quickly launch new advertising campaigns, and eliminate or greatly reduce print production and installation costs. In addition, digital displays enable us to run multiple advertisements on each display. Digital billboard displays generate approximately four to five times more revenue per display on average than comparable traditional static billboard displays. Digital billboard displays also incur, on average, approximately two to four times more costs, including higher variable costs associated with the increase in revenue than comparable traditional static billboard displays. As a result, digital billboard displays generate higher profits and cash flows than comparable traditional static billboard displays.

Previous wording

We have incurred, and we intend to incur, significant equipment deployment costs and capital expenditures, in the coming years to continue increasing the number of digital displays in our portfolio. However, we expect our annual equipment deployment cost spending with respect to the New York Metropolitan Transportation Authority (the “MTA”) transit franchise will decline after our expected substantial completion of our initial deployment in 2024.

Current wording

We have incurred, and we intend to incur, significant equipment deployment costs and capital expenditures, in the coming years to continue increasing the number of digital displays in our portfolio. However, we expect our annual equipment deployment cost spending with respect to the New York Metropolitan Transportation Authority (the “MTA”) transit franchise will decline now that we have substantially completed our initial deployment during 2024.

Previous wording

During the six months ended June 30, 2024, we built or converted 46 new digital billboard displays in the U.S. Additionally, in the six months ended June 30, 2024, we entered into marketing arrangements to sell advertising on 13 third-party digital billboard displays in the U.S. In the six months ended June 30, 2024, we built, converted or replaced 4,316 digital transit and other displays in the U.S. The following table sets forth information regarding our digital displays.

Current wording

During the nine months ended September 30, 2024, we built or converted 65 new digital billboard displays in the U.S. and entered into marketing arrangements to sell advertising on 14 third-party digital billboard displays in the U.S. In the nine months ended September 30, 2024, we built, converted or replaced 5,717 digital transit and other displays in the U.S. The following table sets forth information regarding our digital displays.

Previous wording

(a)Digital display amounts include 5,615 displays reserved for transit agency use. Our number of digital displays is impacted by acquisitions, dispositions, management agreements, the net effect of new and lost billboards, and the net effect of won and lost franchises in the period.

Current wording

(a)Digital display amounts include 5,867 displays reserved for transit agency use. Our number of digital displays is impacted by acquisitions, dispositions, management agreements, the net effect of new and lost billboards, and the net effect of won and lost franchises in the period.

Previous wording

We have a diversified base of customers across various industries. During the three months ended June 30, 2024, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 18%, 11% and 8% of our total U.S. Media segment revenues, respectively. During the three months ended June 30, 2023, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 21%, 10% and 8% of our total U.S. Media segment revenues, respectively. During the six months ended June 30, 2024, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 19%, 11% and 9% of our total U.S. Media segment revenues, respectively. During the six months ended June 30, 2023, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 20%, 10% and 9% of our total U.S. Media segment revenues, respectively.

Current wording

We have a diversified base of customers across various industries. During the three months ended September 30, 2024, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 18%, 12% and 8% of our total U.S. Media segment revenues, respectively. During the three months ended September 30, 2023, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 19%, 11% and 9% of our total U.S. Media segment revenues, respectively. During the nine months ended September 30, 2024, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 18%, 11% and 9% of our total U.S. Media segment revenues, respectively. During the nine months ended September 30, 2023, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 20%, 10% and 9% of our total U.S. Media segment revenues, respectively.

Previous wording

Our large-scale portfolio allows our customers to reach a national audience and also provides the flexibility to tailor campaigns to specific regions or markets. We generated approximately 42% of our U.S. Media segment revenues from national advertising campaigns in the three months ended June 30, 2024, compared to approximately 43% in the same prior-year period. We generated approximately 40% of our U.S. Media segment revenues from national advertising campaigns in the six months ended June 30, 2024, compared to approximately 42% in the same prior-year period.

Current wording

Our large-scale portfolio allows our customers to reach a national audience and also provides the flexibility to tailor campaigns to specific regions or markets. We generated approximately 42% of our U.S. Media segment revenues from national advertising campaigns in the three months ended September 30, 2024, compared to approximately 43% in the same prior-year period. We generated approximately 41% of our U.S. Media segment revenues from national advertising campaigns in the nine months ended September 30, 2024, compared to approximately 42% in the same prior-year period.

Previous wording

Total revenues increased by $8.5 million, or 2%, and organic revenues increased $16.1 million, or 4%, in the three months ended June 30, 2024, compared to the same prior-year period. Total revenues increased by $21.2 million, or 2%, and organic revenues increased $27.8 million, or 3%, in the six months ended June 30, 2024, compared to the same prior-year period.

Current wording

Total revenues decreased by $2.9 million, or 1%, and organic revenues increased $21.4 million, or 5%, in the three months ended September 30, 2024, compared to the same prior-year period. Total revenues increased by $18.3 million, or 1%, and organic revenues increased $49.2 million, or 4%, in the nine months ended September 30, 2024, compared to the same prior-year period.

Previous wording

In the three and six months ended June 30, 2024, non-organic revenues reflect the impact of the Transaction. In the three and six months ended June 30, 2023, non-organic revenues reflect the impact of the Transaction and the impact of foreign currency exchange rates.

Current wording

In the three months ended September 30, 2023, nine months ended September 30, 2024, and nine months ended September 30, 2023, non-organic revenues reflect the impact of the Transaction. Also in the nine months ended September 30, 2023, non-organic revenues reflect the impact of foreign currency exchange rates.

Previous wording

Total billboard revenues increased $1.8 million in the three months ended June 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues and the impact of new and lost billboards in the period, including insignificant acquisitions, partially offset by the impact of the Transaction. Total billboard revenues increased $10.0 million, or 1%, in the six months ended June 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues and the impact of new and lost billboards in the period, including insignificant acquisitions, partially offset by the impact of the Transaction and lower proceeds from condemnations.

Current wording

Total billboard revenues decreased $3.0 million, or 1%, in the three months ended September 30, 2024, compared to the same prior-year period, primarily due to the impact of the Transaction, partially offset by an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues, the impact of new and lost billboards in the period, including insignificant acquisitions, and higher proceeds from condemnations. Total billboard revenues increased $7.0 million, or 1%, in the nine months ended September 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues and the impact of new and lost billboards in the period, including insignificant acquisitions, partially offset by the impact of the Transaction and lower proceeds from condemnations.

Previous wording

Organic billboard revenues increased $8.0 million, or 2%, in the three months ended June 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues and the impact of new and lost billboards in the period, including insignificant acquisition. Organic billboard revenues increased $15.8 million, or 2%, in the six months ended June 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues and the impact of new and lost billboards in the period, including insignificant acquisitions, partially offset by lower proceeds from condemnations.

Current wording

Organic billboard revenues increased $16.6 million, or 5%, in the three months ended September 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues, the impact of new and lost billboards in the period, including insignificant acquisitions, and higher proceeds from condemnations. Organic billboard revenues increased $32.4 million, or 3%, in the nine months ended September 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues and the impact of new and lost billboards in the period, including insignificant acquisitions, partially offset by lower proceeds from condemnations.

Previous wording

Total transit and other revenues increased $6.7 million, or 7%, in the three months ended June 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period and the impact of the Transaction. Total transit and other revenues increased $11.2 million, or 6%, in the six months ended June 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period and the impact of the Transaction.

Current wording

Total transit and other revenues increased $0.1 million in the three months ended September 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of the Transaction and the impact of new and lost transit franchise contracts in the period. Total transit and other revenues increased $11.3 million, or 4%, in the nine months ended September 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period and the impact of the Transaction.

Previous wording

Organic transit and other revenues increased $8.1 million, or 9%, in the three months ended June 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period. Organic transit and other revenues increased $12.0 million, or 7%, in the six months ended June 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period.

Current wording

Organic transit and other revenues increased $4.8 million, or 6%, in the three months ended September 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period. Organic transit and other revenues increased $16.8 million, or 7%, in the nine months ended September 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period.

Previous wording

Billboard property lease expenses represented 33% of billboard revenues in the three months ended June 30, 2024, and 35% in the three months ended June 30, 2023. The decrease in billboard property lease expenses as a percentage of billboard revenues in the three months ended June 30, 2024, is primarily due to lower variable billboard property lease costs driven by higher revenue performance in advertising markets that have lower variable billboard property lease costs and lower revenue performance in advertising markets that have higher variable billboard property lease costs, partially offset by the impact of new locations, including through acquisitions. Billboard property lease expenses represented 35% of billboard revenues in the six months ended June 30, 2024, and 36% in the six months ended June 30, 2023. The decrease in billboard property lease expenses as a percentage of billboard revenues in the six months ended June 30, 2024, is primarily due lower variable billboard property lease costs driven by higher revenue performance in advertising markets that have lower variable billboard property lease costs and lower revenue performance in advertising markets that have higher variable billboard property lease costs (see Note 5. Leases to the Consolidated Financial Statements), which includes an out-of-period adjustment of $5.2 million recorded in the three months ended March 31, 2023, related to variable billboard property lease costs (see Note 1. Description of Business and Basis of Presentationto the Consolidated Financial Statements) and the impact of new locations, including through acquisitions.

Current wording

Billboard property lease expenses represented 33% of billboard revenues in the three months ended September 30, 2024, and 34% in the three months ended September 30, 2023. The decrease in billboard property lease expenses as a percentage of billboard revenues in the three months ended September 30, 2024, is primarily due to lower variable billboard property lease costs driven by higher revenue performance in advertising markets that have lower variable billboard property lease costs and lower revenue performance in advertising markets that have higher variable billboard property lease costs, partially offset by the impact of new locations, including through acquisitions. Billboard property lease expenses represented 34% of billboard revenues in the nine months ended September 30, 2024, and 35% in the nine months ended September 30, 2023. The decrease in billboard property lease expenses as a percentage of billboard revenues in the nine months ended September 30, 2024, is primarily due to lower variable billboard property lease costs driven by higher revenue performance in advertising markets that have lower variable billboard property lease costs and lower revenue performance in advertising markets that have higher variable billboard property lease costs (see Note 5. Leases to the Consolidated Financial Statements) and the impact of new locations, including through acquisitions.

Previous wording

Transit franchise expenses represented 64% of transit display revenues in the three months ended June 30, 2024, 70% in the three months ended June 30, 2023, 72% of transit display revenues in the six months ended June 30, 2024, and 78% in the six months ended June 30, 2023. The decreases in transit franchise expenses, as a percentage of transit display revenues in the three and six months ended June 30, 2024, compared to the same prior-year periods, are primarily driven by MTA revenues growing at a faster pace than the inflationary increase to the guaranteed minimum annual payments to the MTA under the MTA Agreement (as defined below), partially offset by the net impact of new and lost transit franchise contracts. We expect transit franchise expenses, as a percentage of transit display revenues, to decline in the remainder of 2024 compared to 2023, but remain above pre-COVID-19 pandemic levels, as a result of our expectation that revenues generated under the MTA Agreement in 2024 will grow at a compound annual growth rate above the inflation-adjusted guaranteed minimum annual payments to the MTA.

Current wording

Transit franchise expenses represented 73% of transit display revenues in the three months ended September 30, 2024, 73% in the three months ended September 30, 2023, 72% of transit display revenues in the nine months ended September 30, 2024, and 76% in the nine months ended September 30, 2023. The decrease in transit franchise expenses, as a percentage of transit display revenues in the nine months ended September 30, 2024, compared to the same prior-year period, was primarily driven by MTA revenues growing at a faster pace than the inflationary increase to the guaranteed minimum annual payments to the MTA under the MTA Agreement (as defined below), partially offset by the net impact of new and lost transit franchise contracts.

Previous wording

Billboard property lease and transit franchise expenses decreased $6.6 million, or 3%, in the three months ended June 30, 2024, compared to the same prior-year period, primarily due to lower variable property lease expenses, the impact of the Transaction and the net impact of new and lost transit franchise contracts, partially offset by higher guaranteed minimum annual payments to the MTA and the impact of new locations, including through acquisitions. Billboard property lease and transit franchise expenses decreased $6.7 million, or 2%, in the six months ended June 30, 2024, compared to the same prior-year period, primarily due to lower variable property lease expenses, which includes an out-of-period adjustment of $5.2 million recorded in the three months ended March 31, 2023, related to variable billboard property lease costs (see Note 1. Description of Business and Basis of Presentation to the Consolidated Financial Statements), the impact of the Transaction and the net impact of new and lost transit franchise contracts, partially offset by higher guaranteed minimum annual payments to the MTA and the impact of new locations, including through acquisitions.

Current wording

Billboard property lease and transit franchise expenses decreased $5.3 million, or 3%, in the three months ended September 30, 2024, compared to the same prior-year period, primarily due to the impact of the Transaction, lower variable property lease expenses and the net impact of new and lost transit franchise contracts, partially offset by higher guaranteed minimum annual payments to the MTA and the impact of new locations, including through acquisitions. Billboard property lease and transit franchise expenses decreased $6.8 million, or 1%, in the nine months ended September 30, 2024, compared to the same prior-year period, primarily due to lower variable property lease expenses, the impact of the Transaction and the net impact of new and lost transit franchise contracts, partially offset by higher guaranteed minimum annual payments to the MTA and the impact of new locations, including through acquisitions.

Previous wording

Posting, maintenance and other expenses as a percentage of revenues were 12% in each of the three months ended June 30, 2024 and 2023, and 13% in each of the six months ended June 30, 2024, and 2023. Posting, maintenance and other expenses increased $0.5 million, or 1%, in the three months ended June 30, 2024, compared to the same prior-year period, primarily due to higher compensation-related expenses, higher posting and rotation costs, driven by higher business activity, and higher maintenance and utilities cost, driven by inflationary cost increases, partially offset by the impact of the Transaction and lower materials costs driven by lower third-party equipment sales. Posting, maintenance and other expenses increased $3.8 million, or 3%, in the six months ended June 30, 2024, compared to the same prior-year period, primarily due to higher compensation-related expenses, higher posting and rotation costs, driven by higher business activity, and higher maintenance and utilities cost, driven by inflationary cost increases, partially offset by the impact of the Transaction and lower materials costs driven by lower third-party equipment sales.

Current wording

Posting, maintenance and other expenses as a percentage of revenues were 12% in each of the three months ended September 30, 2024 and 2023, and 13% in each of the nine months ended September 30, 2024, and 2023. Posting, maintenance and other expenses decreased $1.4 million, or 2%, in the three months ended September 30, 2024, compared to the same prior-year period, primarily due to the impact of the Transaction and lower materials costs driven by lower third-party equipment sales, partially offset by higher compensation-related expenses and higher posting and rotation costs, driven by higher business activity. Posting, maintenance and other expenses increased $2.4 million, or 1%, in the nine months ended September 30, 2024, compared to the same prior-year period, primarily due to higher compensation-related expenses, higher posting and rotation costs, driven by higher business activity, and higher maintenance and utilities cost, driven by inflationary cost increases, partially offset by the impact of the Transaction and lower materials costs driven by lower third-party equipment sales.

Previous wording

SG&A expenses represented 25% of Revenues in the three months ended June 30, 2024, 23% of Revenues in the three months ended June 30, 2023, 26% of Revenues in the six months ended June 30, 2024 and 25% of Revenues in the six months ended June 30, 2023. SG&A expenses increased $10.5 million, or 10%, in the three months ended June 30, 2024, compared to the same prior-year period, primarily due to higher compensation-related expenses, including salaries and commissions, higher professional fees, as a result of a management consulting project, a higher provision for doubtful accounts and higher rent related to new offices. SG&A expenses increased $13.1 million, or 6%, in the six months ended June 30, 2024, compared to the same prior-year period, primarily due to higher compensation-related expenses, including salaries and commissions, higher professional fees, as a result of a management consulting project, higher rent related to new offices and a higher provision for doubtful accounts. We continue to evaluate methods to lower SG&A expense growth.

Current wording

SG&A expenses represented 24% of Revenues in the three months ended September 30, 2024, 23% of Revenues in the three months ended September 30, 2023, 25% of Revenues in the nine months ended September 30, 2024 and 24% of Revenues in the nine months ended September 30, 2023. SG&A expenses increased $3.4 million, or 3%, in the three months ended September 30, 2024, compared to the same prior-year period, primarily due to higher compensation-related expenses, including salaries and commissions, the impact of market fluctuations on an unfunded equity-linked retirement plan offered by the Company to certain employees and higher professional fees, as a result of a management consulting project, partially offset by the impact of the Transaction and a lower provision for doubtful accounts. SG&A expenses increased $16.5 million, or 5%, in the nine months ended September 30, 2024, compared to the same prior-year period, primarily due to higher compensation-related expenses, including salaries and commissions, higher professional fees, as a result of a management consulting project, the impact of market fluctuations on an unfunded equity-linked retirement plan offered by the Company to certain employees and higher rent related to new offices, partially offset by the impact of the Transaction. We continue to evaluate methods to lower SG&A expense growth.

Previous wording

Net gain on dispositions increased $155.1 million in the three months ended June 30, 2024, compared to the same prior-year period due primarily to the Transaction. Net gain on dispositions was $155.1 million compared to a Net loss on dispositions of $0.2 million in the six months ended June 30, 2024, compared to the same prior-year period, due primarily to the impact of the Transaction.

Current wording

Net loss on dispositions was $1.5 million in the three months ended September 30, 2024. Net gain on dispositions was $153.6 million in the nine months ended September 30, 2024, compared to a Net loss on dispositions of $0.2 million in the same prior-year period, due primarily to the impact of the Transaction.

Previous wording

As a result of negative aggregate cash flows related to our MTA asset group, we performed quarterly impairment analyses on the MTA asset group and recorded impairment charges of $8.8 million in the three months ended June 30, 2024, and $17.9 million in the six months ended June 30, 2024, representing additional MTA equipment deployment cost spending during the periods. In the three and six months ended June 30, 2023, we recorded impairment charges of $511.4 million, primarily representing a $443.1 million impairment charge related to our MTA asset group (see Note 4. Intangible Assetsto the Consolidated Financial Statements) and an impairment charge of $47.6 million representing the entire goodwill balance associated with our U.S. Transit and Other reporting unit.

Current wording

As a result of negative aggregate cash flow forecasts related to our MTA asset group, we performed quarterly impairment analyses on the MTA asset group during the three months ended March 31, 2024 and June 30, 2024, and recorded impairment charges of $9.1 million and $8.8 million, respectively, in those periods for a total of $17.9 million in the six months ended June 30, 2024. The impairment charges recorded during 2024 represented additional MTA equipment deployment cost spending during the six months ended June 30, 2024. Our analysis performed as of September 30, 2024, resulted in positive aggregate cash flows in excess of the carrying value of our MTA asset group. As such, no impairment charges were recorded during the three months ended September 30, 2024. In the three months ended September 30, 2023, we recorded impairment charges of $12.1 million, representing additional MTA equipment deployment costs spending during the quarter, and in the nine months ended September 30, 2023, we recorded impairment charges of $523.5 million, primarily representing $455.2 million of impairment charges related to our MTA asset group (see Note 4. Intangible Assetsto the Consolidated Financial Statements) and an impairment charge of $47.6 million representing the entire goodwill balance associated with our U.S. Transit and Other reporting unit.

Previous wording

In addition, in the second quarter of 2023, we recorded an impairment charge of $0.3 million related to an other-than-temporary decline in fair value of a cost-method investment.

Current wording

In addition, in the nine months ended September 30, 2023, we recorded an impairment charge of $0.3 million related to an other-than-temporary decline in fair value of a cost-method investment.

Previous wording

Depreciation decreased $1.3 million, or 7%, in the three months ended June 30, 2024, compared to the same prior-year period, and decreased $2.9 million, or 7%, in the six months ended June 30, 2024, compared to the same prior-year period, due primarily to the Transaction. (See Note 11. Acquisitions and Dispositions: Dispositions: Canadian Business.)

Current wording

Depreciation decreased $0.7 million, or 4%, in the three months ended September 30, 2024, compared to the same prior-year period, and decreased $3.6 million, or 6%, in the nine months ended September 30, 2024, compared to the same prior-year period, due primarily to the impact of the Transaction (see Note 12. Acquisitions and Dispositions: Dispositions: Canadian Business), partially offset by higher depreciation on current year projects.

Previous wording

Amortization decreased $4.2 million, or 20%, in the three months ended June 30, 2024, and decreased $8.4 million, or 19%, in the six months ended June 30, 2024, compared to the same prior-year periods, due primarily to the Transaction. (See Note 11. Acquisitions and Dispositions: Dispositions: Canadian Business.)

Current wording

Amortization decreased $1.0 million, or 5%, in the three months ended September 30, 2024, and decreased $9.4 million, or 15%, in the nine months ended September 30, 2024, compared to the same prior-year periods, due primarily to the impact of the Transaction (see Note 12. Acquisitions and Dispositions: Dispositions: Canadian Business), partially offset by higher amortization related to asset acquisitions completed within the last year.

Previous wording

Interest expense, net, was $41.1 million (including $1.5 million of deferred financing costs) in the three months ended June 30, 2024, and $39.7 million (including $1.8 million of deferred financing costs) in the same prior-year period. Interest expense, net, was $82.5 million (including $3.1 million of deferred financing costs) in the six months ended June 30, 2024, and $77.4 million (including $3.4 million of deferred financing costs) in the same prior-year period. The increases were primarily due to higher interest rates and a higher average debt balance.

Current wording

Interest expense, net, was $37.1 million (including $1.5 million of deferred financing costs) in the three months ended September 30, 2024, and $40.2 million (including $1.6 million of deferred financing costs) in the same prior-year period. Interest expense, net, decreased in the three months ended September 30, 2024, compared to the same prior-year period, due primarily to a lower average debt balance, partially offset by higher interest rates. Interest expense, net, was $119.6 million (including $4.6 million of deferred financing costs) in the nine months ended September 30, 2024, and $117.6 million (including $5.0 million of deferred financing costs) in the same prior-year period. Interest expense, net, increased in the nine months ended September 30, 2024, compared to the same prior-year period, primarily due to higher interest rates, partially offset by a lower average debt balance.

Previous wording

In the three and six months ended June 30, 2024, we recorded a loss on extinguishment of debt of $1.2 million, relating to the write-off of deferred financing costs and a portion of the discount on the Term Loan (as defined below), due to prepayments on the Term Loan.

Current wording

In the nine months ended September 30, 2024, we recorded a loss on extinguishment of debt of $1.2 million, relating to the write-off of deferred financing costs and a portion of the discount on the Term Loan (as defined below), due to prepayments on the Term Loan.

Previous wording

Provision for income taxes increased $10.7 million in the three months ended June 30, 2024, compared to the same prior-year period, due primarily to a gain on disposition related to the Transaction. Provision for income taxes increased $9.8 million in the six months ended June 30, 2024, compared to the same prior-year period, due primarily to a gain on disposition related to the Transaction.

Current wording

Benefit for income taxes was $0.2 million in the three months ended September 30, 2024, compared to a Provision for income taxes of $1.4 million in the same prior-year period, due primarily to the impact of the Transaction. Provision for income taxes increased $8.2 million in the nine months ended September 30, 2024, compared to the same prior-year period, due primarily to a gain on disposition related to the Transaction.

Previous wording

Net income before allocation to non-controlling interests was $177.0 million in the three months ended June 30, 2024, compared to a Net loss before allocation to non-controlling interests of $478.4 million in the same prior-year period, primarily driven by higher operating income, due primarily to a gain on disposition related to the Transaction and higher impairment charges incurred in 2023, partially offset by a higher provision for income taxes and higher interest expense. Net income before allocation to non-controlling interests was $149.9 million in the six months ended June 30, 2024, compared a Net loss before allocation to non-controlling interests of $507.1 million in the same prior-year period, primarily driven by higher operating income, due primarily to a gain on disposition related to the Transaction and higher impairment charges incurred in 2023, partially offset by partially offset by a higher provision for income taxes and higher interest expense.

Current wording

Net income before allocation to redeemable and non-redeemable noncontrolling interests increased $18.1 million, or 108%, in the three months ended September 30, 2024, compared to the same prior-year period, primarily driven by higher operating income, impairment charges incurred in 2023 and lower interest expense. Net income before allocation to redeemable and non-redeemable noncontrolling interests was $184.7 million in the nine months ended September 30, 2024, compared a Net loss before allocation to redeemable and non-redeemable noncontrolling interests of $485.2 million in the same prior-year period, primarily driven by higher operating income, due primarily to a gain on disposition related to the Transaction and higher impairment charges incurred in 2023, partially offset by a higher provision for income taxes and higher interest expense.

Previous wording

When used herein, references to “FFO” and “AFFO” mean “FFO attributable to OUTFRONT Media Inc.” and “AFFO attributable to OUTFRONT Media Inc.,” respectively. We calculate FFO in accordance with the definition established by the National Association of Real Estate Investment Trusts (“NAREIT”). FFO reflects net income (loss) attributable to OUTFRONT Media Inc. adjusted to exclude gains and losses from the sale of real estate assets, impairment charges, depreciation and amortization of real estate assets, amortization of direct lease acquisition costs and the same adjustments for our equity-based investments and non-controlling interests, as well as the related income tax effect of adjustments, as applicable. We calculate AFFO as FFO adjusted to include cash paid for direct lease acquisition costs as such costs are generally amortized over a period ranging from four weeks to one year and therefore are incurred on a regular basis. AFFO also includes cash paid for maintenance capital expenditures since these are routine uses of cash that are necessary for our operations. In addition, AFFO excludes losses on extinguishment of debt, as well as certain non-cash items, including non-real estate depreciation and amortization, impairment charges on non-real estate assets, stock-based compensation expense, accretion expense, the non-cash effect of straight-line rent, amortization of deferred financing costs and the same adjustments for our non-controlling interests, along with the non-cash portion of income taxes, and the related income tax effect of adjustments, as applicable. We use FFO and AFFO measures for managing our business and for planning and forecasting future periods, and each is an important indicator of our operational strength and business performance, especially compared to other REITs. Our management believes users of our financial data are best served if the information that is made available to them allows them to align their analysis and evaluation of our operating results along the same lines that our management uses in managing, planning and executing our business strategy. Our management also believes that the presentations of FFO and AFFO, as supplemental measures, are useful in evaluating our business because adjusting results to reflect items that have more bearing on the operating performance of REITs highlight trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures. It is management’s opinion that these supplemental measures provide users of our financial data with an important perspective on our operating performance and also make it easier to compare our results to other companies in our industry, as well as to REITs.

Current wording

When used herein, references to “FFO” and “AFFO” mean “FFO attributable to OUTFRONT Media Inc.” and “AFFO attributable to OUTFRONT Media Inc.,” respectively. We calculate FFO in accordance with the definition established by the National Association of Real Estate Investment Trusts (“NAREIT”). FFO reflects net income (loss) attributable to OUTFRONT Media Inc. adjusted to exclude gains and losses from the sale of real estate assets, impairment charges, depreciation and amortization of real estate assets, amortization of direct lease acquisition costs and the same adjustments for our equity-based investments and redeemable and non-redeemable noncontrolling interests, as well as the related income tax effect of adjustments, as applicable. We calculate AFFO as FFO adjusted to include cash paid for direct lease acquisition costs as such costs are generally amortized over a period ranging from four weeks to one year and therefore are incurred on a regular basis. AFFO also includes cash paid for maintenance capital expenditures since these are routine uses of cash that are necessary for our operations. In addition, AFFO excludes losses on extinguishment of debt, as well as certain non-cash items, including non-real estate depreciation and amortization, impairment charges on non-real estate assets, stock-based compensation expense, accretion expense, the non-cash effect of straight-line rent, amortization of deferred financing costs and the same adjustments for our redeemable and non-redeemable noncontrolling interests, along with the non-cash portion of income taxes, and the related income tax effect of adjustments, as applicable. We use FFO and AFFO measures for managing our business and for planning and forecasting future periods, and each is an important indicator of our operational strength and business performance, especially compared to other REITs. Our management believes users of our financial data are best served if the information that is made available to them allows them to align their analysis and evaluation of our operating results along the same lines that our management uses in managing, planning and executing our business strategy. Our management also believes that the presentations of FFO and AFFO, as supplemental measures, are useful in evaluating our business because adjusting results to reflect items that have more bearing on the operating performance of REITs highlight trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures. It is management’s opinion that these supplemental measures provide users of our financial data with an important perspective on our operating performance and also make it easier to compare our results to other companies in our industry, as well as to REITs.

Previous wording

The following table reconciles Operating income (loss) to Adjusted OIBDA, and Net loss attributable to OUTFRONT Media Inc. to FFO attributable to OUTFRONT Media Inc. and AFFO attributable to OUTFRONT Media Inc.

Current wording

The following table reconciles Operating income (loss) to Adjusted OIBDA, and Net income (loss) attributable to OUTFRONT Media Inc. to FFO attributable to OUTFRONT Media Inc. and AFFO attributable to OUTFRONT Media Inc.

Previous wording

(c)In 2023, also includes an Impairment charge related to an other-than-temporary decline in fair value of a cost-method investment.

Current wording

(c)In nine months ended September 30, 2023, also includes an Impairment charge related to an other-than-temporary decline in fair value of a cost-method investment.

Previous wording

FFO attributable to OUTFRONT Media Inc. was $83.8 million in the three months ended June 30, 2024, compared to a deficit of $59.8 million in the same prior-year period, due primarily to lower impairment charges on non-real estate assets. AFFO attributable to OUTFRONT Media Inc. increased $6.8 million, or 9%, in the three months ended June 30, 2024, compared to the same prior-year period, due primarily to higher Adjusted OIBDA and lower cash paid for income taxes. FFO attributable to OUTFRONT Media Inc. was $106.1 million in the six months ended June 30, 2024, compared to a deficit of $42.7 million in the same prior-year period, due primarily to lower impairment charges on non-real estate assets. AFFO attributable to OUTFRONT Media Inc. increased $21.2 million, or 24%, in the six months ended June 30, 2024, compared to the same prior- year period, due primarily to higher Adjusted OIBDA, lower maintenance capital expenditures and lower cash paid for income taxes.

Current wording

FFO attributable to OUTFRONT Media Inc. increased $9.3 million, or 13%, in the three months ended September 30, 2024, compared to the same prior-year period, due primarily to lower impairment charges on non-real estate assets and lower interest expense. AFFO attributable to OUTFRONT Media Inc. increased $5.1 million, or 7%, in the three months ended September 30, 2024, compared to the same prior-year period, due primarily to lower maintenance capital expenditures. FFO attributable to OUTFRONT Media Inc. increased $152.9 million in the nine months ended September 30, 2024, compared to the same prior-year period, due primarily to lower impairment charges on non-real estate assets. AFFO attributable to OUTFRONT Media Inc.

Previous wording

We present Adjusted OIBDA as the primary measure of profit and loss for our reportable segments. (See the “Key Performance Indicators” section of this MD&A and Note 17. Segment Information to the Consolidated Financial Statements.)

Current wording

We present Adjusted OIBDA as the primary measure of profit and loss for our U.S. Media reportable segment and Other. (See the “Key Performance Indicators” section of this MD&A and Note 18. Segment Information to the Consolidated Financial Statements.)

Previous wording

The following table presents our Revenues, Adjusted OIBDA and Operating income (loss)by segment in the three and six months ended June 30, 2024 and 2023.

Current wording

The following table presents our Revenues, Adjusted OIBDA and Operating income (loss)by segment in the three and nine months ended September 30, 2024 and 2023.

Previous wording

Total U.S. Media segment revenues increased $17.9 million, or 4%, in the three months ended June 30, 2024, compared to the same prior-year period, due primarily to higher transit and other revenues, as well as higher billboard revenues. Total U.S. Media segment revenues increased $31.1 million, or 4%, in the six months ended June 30, 2024, compared to the same prior-year period, due primarily to higher transit and other revenues, as well as higher billboard revenues. We generated approximately 42% in the three months ended June 30, 2024, 43% in the three months ended June 30, 2023, 40% in the six months ended June 30, 2024, and 42% in the six months ended June 30, 2023, of our U.S. Media segment revenues from national advertising campaigns.

Current wording

Total U.S. Media segment revenues increased $22.8 million, or 5%, in the three months ended September 30, 2024, compared to the same prior-year period, due primarily to higher transit and other revenues, as well as higher billboard revenues. Total U.S. Media segment revenues increased $53.9 million, or 4%, in the nine months ended September 30, 2024, compared to the same prior-year period, due primarily to higher transit and other revenues, as well as higher billboard revenues. We generated approximately 42% in the three months ended September 30, 2024, 43% in the three months ended September 30, 2023, 41% in the nine months ended September 30, 2024, and 42% in the nine months ended September 30, 2023, of our U.S. Media segment revenues from national advertising campaigns.

Previous wording

Billboard revenues in the U.S. Media segment increased $8.0 million, or 2%, in the three months ended June 30, 2024, compared to the same prior-year period, reflecting an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues and the impact of new and lost billboards in the period, including insignificant acquisitions. Billboard revenues in the U.S. Media segment increased $15.8 million, or 2%, in the six months ended June 30, 2024, compared to the same prior-year period, reflecting an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues and the impact of new and lost billboards in the period, including insignificant acquisitions, partially offset by lower proceeds from condemnations.

Current wording

Billboard revenues in the U.S. Media segment increased $16.6 million, or 5%, in the three months ended September 30, 2024, compared to the same prior-year period, reflecting an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues, the impact of new and lost billboards in the period, including insignificant acquisitions, and higher proceeds from condemnations. Billboard revenues in the U.S. Media segment increased $32.4 million, or 3%, in the nine months ended September 30, 2024, compared to the same prior-year period, reflecting an increase in average revenue per display (yield), driven by the impact of programmatic and direct sale advertising platforms on digital billboard revenues and the impact of new and lost billboards in the period, including insignificant acquisitions, partially offset by lower proceeds from condemnations.

Previous wording

Transit and other revenues in the U.S. Media segment increased $9.9 million, or 11%, in the three months ended June 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period. Transit and other revenues in the U.S. Media segment increased $15.3 million, or 9%, in the six months ended June 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period.

Current wording

Transit and other revenues in the U.S. Media segment increased $6.2 million, or 7%, in the three months ended September 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period. Transit and other revenues in the U.S. Media segment increased $21.5 million, or 9%, in the nine months ended September 30, 2024, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), partially offset by the impact of new and lost transit franchise contracts in the period.

Previous wording

Operating expenses in the U.S. Media segment decreased $1.9 million, or 1%, in the three months ended June 30, 2024, compared to the same prior-year period, primarily driven by lower variable property lease expenses and the net impact of new and lost transit franchise contracts, partially offset by higher guaranteed minimum annual payments to the MTA, higher compensation-related expenses, higher posting and rotation costs, driven by higher business activity, and higher maintenance and utilities cost, driven by inflationary cost increases. Operating expenses in the U.S. Media segment increased $1.7 million in the six months ended June 30, 2024, compared to the same prior-year period, primarily driven by higher billboard revenues, higher guaranteed minimum annual payments to the MTA, higher compensation-related expenses, higher posting and rotation costs, driven by higher business activity, and higher maintenance and utilities cost, driven by inflationary cost increases, partially offset by an out-of-period adjustment of $5.2 million recorded in the three months ended March 31, 2023, related to variable billboard property lease costs (see Note 1. Description of Business and Basis of Presentationto the Consolidated Financial Statements) and the net impact of new and lost transit franchise contracts.

Current wording

Operating expenses in the U.S. Media segment increased $7.1 million, or 3%, in the three months ended September 30, 2024, compared to the same prior-year period, primarily driven by higher guaranteed minimum annual payments to the MTA, higher compensation-related expenses and higher posting and rotation costs, driven by higher business activity, partially offset by lower variable property lease expenses and the net impact of new and lost transit franchise contracts. Operating expenses in the

Previous wording

SG&A expenses in the U.S. Media segment increased $7.4 million, or 9%, in the three months ended June 30, 2024, compared to the same prior-year period, primarily driven by higher compensation-related expenses, a higher provision for doubtful accounts, higher rent related to new offices and higher insurance costs, partially offset by lower professional fees. SG&A expenses in the U.S. Media segment increased $7.3 million, or 4%, in the six months ended June 30, 2024, compared to the same prior-year period, primarily driven by higher compensation-related expenses, a higher provision for doubtful accounts and higher rent related to new offices, partially offset by lower professional fees.

Current wording

SG&A expenses in the U.S. Media segment increased $2.4 million, or 3%, in the three months ended September 30, 2024, compared to the same prior-year period, primarily driven by higher compensation-related expenses, partially offset by lower professional fees and a lower provision for doubtful accounts. SG&A expenses in the U.S. Media segment increased $9.7 million, or 4%, in the nine months ended September 30, 2024, compared to the same prior-year period, primarily driven by higher compensation-related expenses and higher rent related to new offices, partially offset by lower professional fees.

Previous wording

In the three months ended June 30, 2024, we recorded impairment charges of $8.8 million and in the six months ended June 30, 2024, we recorded impairment charges of $17.9 million in the U.S. Media segment, primarily related to impairment charges with respect to our MTA asset group and our U.S. Transit and Other reporting unit. In the three and six months ended June 30, 2023, we recorded impairment charges of $511.4 million in the U.S. Media segment, primarily related to impairment charges with respect to our MTA asset group and our U.S. Transit and Other reporting unit. (See Note 4. Intangible Assets to the Consolidated Financial Statements.)

Current wording

In the nine months ended September 30, 2024, we recorded impairment charges of $17.9 million in the U.S. Media segment, primarily related to impairment charges with respect to our MTA asset group and our U.S. Transit and Other reporting unit. We did not record any impairment charges in the three months ended September 30, 2024. In the three months ended September 30, 2023, we recorded impairment charges of $12.1 million and in the nine months ended September 30, 2023, we recorded impairment charges of $523.5 million in the U.S. Media segment, primarily related to impairment charges with respect to our MTA asset group and our U.S. Transit and Other reporting unit. (See Note 4. Intangible Assets to the Consolidated Financial Statements.)