Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) Q2 2023 Earnings Call Transcript

I’d also mention that you likely saw CapEx down this quarter versus the same quarter in the prior year. Some of that is timing and deferrals. Some of that is reduction. I think what I would characterize all this as saying is we’re closely monitoring operations and to the extent performance is under what we’re expecting. We will continue to use cost levers and capital levers as appropriate to ensure adequate liquidity.

Ben Swinburne: Thanks guys.

Scott Wells: Thanks, Ben.

Operator: Our next question comes from Steven Cahall from Wells Fargo. Steven, your line is now open. Please proceed.

Steven Cahall: Thank you. Maybe first, Scott, if you could talk a little bit about the differences in Local versus National. We heard from some TV broadcasters on Friday that Local was quite strong, especially in auto. It doesn’t seem like that National is a leading indicator for local right now. But historically, sometimes we have seen local kind of catch up to national trends. So maybe you can kind of compare and contrast what you’re seeing in local demand versus what you’re seeing in national demand? And how you see those two trending with a little bit of a split between how much of your business is local and national? And then on Airports, would just also love some color on the strength there? And Brian, is it correct that you do have a tough rent abatement comp in the third quarter in Airports, just thinking about how we might model that EBITDA? Thank you.

Scott Wells: Thanks, Steve, I’ll start with the local, national. Roughly, we’re 60% local, 40% national. It fluctuates a little quarter-to-quarter, but that’s a reasonable way to think about our mix. And it definitely is the case for Q2 and for our guide that local is more reliable than national, and it has been really, really since the start of COVID. The two markets really split. There was a stretch where National came roaring back after COVID and then that has abated somewhat in more recent times. And as I was mentioning to Ben, the tech companies, in particular, we know that they’ve been working on their P&Ls and pulling back on ad spending. And we’ve seen the impact of that. As we look forward, I would definitely say that local looks better than national certainly for Q3.

Q4 could be a little bit of a toss-up. Again, I have some expectation that we’re going to see some campaigns come off the sidelines, but it is a very inexact thing to forecast exactly how the advertising is going to go. So that’s local, national. On Airports, we are still benefiting from the build-out of the New York contract. We had Newark [ph] come online this year. LaGuardia came online sort of second half of last year – parts of LaGuardia. LaGuardia has been coming online for a while. So those are some of the things driving the strength in it. I think, obviously, the air travel is driving the strength, and there are a lot of advertisers interested in that real premium audience that’s very, very active this summer. Brian, do you want to take the abatement question?

Brian Coleman: Sure. Steve, I know we had some airport abatements in the second half of last year. I can’t exactly remember the timing. I think we disclosed when that is. And we should expect a reduction as we kind of lapse those rent abatements. So it could lead to a tough comp. Really, the only thing I’d say encounter to that is airports in Americas is the 1 place where we are continuing to seek some relief, and don’t know if and when that will come through, but that could be an offset. I wish I could be more specific, but that’s probably about as much detail as I can give you to help with your model. So hopefully, it’s something to work with.