A Bank of America Merrill Lynch (BoAML) ratings report highlights JCDecaux’s strong Q3. The bank said that organic growth of 2.7% was ahead of their forecast of 1.4%.
The stronger than expected Q3 organic growth was driven by the transport division, up 10.1% versus 4.8% in Q2. Growth for street furniture deteriorated from -0.7% in Q2 to -2.5% with an improvement in France (+2%) offset by difficult conditions in most Northern European countries.
Billboard saw organic growth of -0.3%, an improvement on -6.9% in Q2, largely driven by the UK which benefited from the Olympics. The analyst report estimates that the Olympics added over 2% to group growth, creating a tough comparison for the UK for next year.
While JCDecaux expects good growth in Asia, other markets are expected to deteriorate with a slight decline in Q4 (of around 1-1.5%). The bank calculates that the result for the year will be organic growth of 1%. This is in line with BoAML’s forecast.
The bank still rates JCDecaux as ‘neutral’ due to global advertising forecasts being revised downwards.
