Market instability: oOh!media in trading halt – revenue takes virus hit

An oOh!media spokesman has spoken to Mediaweek this morning after its requested the ASX to halt trading in its shares.

The out-of-home advertising business has suffered from market turmoil as many have in recent times. In the past two months its share price has gone from $3.82 to just 84 cents at the close of trade Thursday this week.

The dropping share price hasn’t been helped by the fact that founder and guiding light Brendon Cook announced in late January he would be stepping down as MD and CEO some time in 2020.

A spokesperson told Mediaweek this morning: “The company does not have liquidity issues. oOh enjoys long term relationships with its banking syndicate and facilities do not expire until 2021. As we announced on Monday, first quarter trading was in line with guidance. However near-term visibility is uncertain in unprecedented market conditions.

“For oOh!media it is about ensuring we are managing short term volatility to ensure the business is well-placed to leverage the opportunity when the markets stabilise and recover – and they will recover.

“In the short term it is about talking to our shareholders about managing CAPEX and implementing cost control measures. This is all about maximising our operational and capital structure to meet short term challenges.

“The long term fundamentals for out of home are still positive. Like the rest of the world, and companies in every sector of the economy, the out of home market is undoubtedly being impacted by the coronavirus.

“In the current environment what we are seeing is a change to how advertisers are using out of home. Audiences are still around. While they may not be travelling to the office, or flying domestically and internationally, they are shopping and exercising.

“Brands still have to have a presence to ensure they emerge as strong or even stronger when we all come out of this challenging time.

“For oOh!, less than 3% of our revenue comes from travel-related areas, and we have great support from our banks.”