oOh!media extends trading halt to work on capital raising

Chris Pash
By Chris Pash | 25 March 2020

oOh!media has extended its trading halt on the ASX as the Australian outdoor advertising specialist considers a capital raising in a tough advertising market made worse by fallout from the pandemic.

The company, when it first went into a trading halt, had expected to get back to the market with more information by Tuesday this week.

However, oOh!media says it may need another five days. 

"oOh! is currently considering a capital raising and is not yet in a position to make an announcement," the company told the ASX. 

oOh!media insiders say the trading halt reflects discussions with major shareholders given the slide in the share price.

The company wants to manage short term volatility and ensure the business is well placed to leverage opportunity when the advertising market stablises and recovers.

The shares last traded at $0.84, indicating a market capitalisation of around $200 million. Net debt was $354.5 million at the end of December 2019 and the company's loans have an expiry date of September 2021.

Analysts have marked down oOh!media’s revenue prospects this year in an already weak advertising market but still see strong long term growth for the out-of-home sector and for oOh!media.

oOh!media earnings this year have been tracking to plan but the company, like many ASX-listed entities facing fallout from the coronavirus, has withdrawn its full year guidance of $140 million to $155 million and is looking at pulling back on capital spending and cutting costs.

oOh!media's full year revenue to December was up 1% to $649.6 million but underlying net profit after tax was down 23% to $37.9 million.

CEO Brendon Cook, in releasing results in February: “In a tough year for media, the overall market declined by an estimated 5%. However, OOH continued to out-perform the broader market and grew by 1% in Australia."  

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