Ströer continues on its growth course in the first quarter

• Consolidated revenue up 17.0% in the first quarter of 2011 to EUR 122.9m
• Consolidated organic growth at 9.7%
• Strong performance by Ströer Germany with high organic revenue growth of 9.4%
• Operational EBITDA down slightly on the prior year due to start-up costs for various new projects
• High investments in further growth

Ströer Out-of-Home Media AG, one of Europe's leading providers of out-of-home advertising based in Cologne, continued on its strong growth course in the first quarter of 2011. Organic growth came to 9.7% (Q1 2010: 5.3%). Total revenue of the Ströer Group was up 17.0% to EUR 122.9m (Q1 2010: EUR 105.1m) and was driven by revenue growth in all of the Company's segments. At EUR 16.2m, operational EBITDA at the Ströer Group was down slightly on the prior year (Q1 2010: EUR 16.7m) due to start-up costs for various projects.

"Ströer Out-of-Home Media AG was able to build on the success of its record year 2010 in the first quarter of this year and continued on its dynamic growth course," said Udo Müller, co-founder and CEO of the Ströer Group, in Cologne today. "This makes us one of the strongest growing media companies in Europe. Our performance in Germany was particularly dynamic and we saw the level of bookings from the top 200 advertisers balloon thanks to our product innovations."

Operating segments
Ströer Germany
In the seasonally soft first quarter, the Ströer Germany segment continued on its steady growth course. At 9.4%, organic growth was at the upper end of our expectations. Revenue rose by 5.6% to EUR 91.9m (Q1 2010: EUR 87.0m), while operational EBITDA was pushed up 7.6% to EUR 18.7m despite various start-up costs for the out-of-home channel and premium billboards projects (Q1 2010: EUR 17.4m). This boosted the operational EBITDA margin by a further 0.4 percentage points to 20.4% and was achieved by an increase in bookings by the top 200 advertising customers, an improved lease ratio and a greater volume of campaigns booked on high-margin premium advertising media.

Ströer Turkey
The Company also started the year on a good footing in the Turkish market and achieved organic growth of 8.9% in this segment. However, the advertising market was overshadowed by a mood of uncertainty toward the end of the first quarter due to changes in TV advertising regulations. Revenue - based on the assumption that the Turkish business had already been fully consolidated in the prior-year quarter, only increased by 3.7% to EUR 18.7m (Q1 2010: EUR 18.1m) due to unfavorable exchange effects.
Operational EBITDA and the operational EBITDA margin were particularly affected by changes in the concession portfolio which came into effect at the start of the year but will not generate any corresponding income until later in the year due to the set-up of additional advertising media, among other things.

Other segment
The "Other" segment, which includes the Polish out-of-home activities and the giant poster business of the blowUP division, achieved organic growth of 14.0%. Revenue shot up 36.3% to EUR 12.3m (Q1 2010: EUR 9.0m). Operational EBITDA only decreased by a marginal EUR 0.1m to EUR 0.8m, while the operational EBITDA margin improved by 1.4 percentage points in the first three months.

Product groups
On a consolidated basis, the billboards product group grew by 21.3% to EUR 62.9m like on like (Q1 2010: EUR 51.9m). This growth was mainly fuelled by the Turkey segment which reported billboard revenue of EUR 13.5m in the first quarter, a more than two-fold increase, largely due to the full consolidation of Ströer Turkey (Q1 2010: EUR 6.2m).
The street furniture product group grew by 28.6% to EUR 33.7m (Q1 2010: EUR 26.2m). The Ströer Germany segment contributed EUR 5.2m to this growth (Q1 2011: EUR 28.7m), reporting an increase of 22.2% itself (Q1 2010: EUR 23.5m).
Revenue from transport media stood at EUR 18.4m in the first quarter (Q1 2010: EUR 15.7m). This represents growth of 17.6% and can be largely attributed to the increase in revenue from the German market for digital advertising faces. Overall, Ströer Germany boasted an increase of 17.4% or EUR 2.7m to EUR 18.1m (Q1 2010: EUR 15.4m).
On 1 April, the initial set-up phase for the out-of-home channel entailing the installation of 500 screens was successfully completed and screens were set up at central train stations such as in Berlin, Munich, Stuttgart and Frankfurt am Main. At the same time, we incorporated this world unique digital network into our regular marketing activities.
On 1 January, Ströer Out-of-Home Media AG began establishing its network of premium billboards. By the end of 2015, this network will include 5,000 high-quality advertising media at top sites.

Forecast
Ströer Out-of-Home Media AG is confident that the Group will benefit from a favorable macroeconomic situation, new projects and structural growth in the full fiscal year 2011. The Company expects to see another year of record revenue and operational EBITDA with solid organic consolidated revenue growth around the mid to high-single-digit mark driven by the solid growth in Germany and positive performance by the Turkish operations. Management expects the growth momentum in Turkey to be stronger in the second half compared with the first half of 2011 when the one-time effects from the introduction of major restrictions on TV advertising times and the parliamentary elections ease off. Nonetheless, these effects will noticeably impede revenue growth in Turkey in the first six months. Against this background, the Company anticipates organic revenue growth of around 4% for the Group in the second quarter of 2011.
Due to the extensive investments in further growth, the full year EBITDA margin is only expected to increase at best marginally year on year.

The Group’s financial figures at a glance­ 

Key financials by operating segment

Ströer Germany

Ströer Turkey

 
Other