Ocean Outdoor revenue rises 44.4% in 2021

Ocean Outdoor experienced a strong bounce back in demand during 2021, which led to a 44.3% increase in Group revenue to £124.4m, and a significant increase in EBITDA to £18.6m. The year of recovery for the DOOH sector began during Q2, with client activity and strong sequential demand tracking the vaccine rollout and phased lifting of restrictions. Importantly, Ocean also experienced a renewed confidence among the high-spending advertising categories, with the ‘power brands’ committing a greater proportion of their budgets to DOOH as well as an increasing number of new adopters, reflecting the long term structural tailwind within the sector.

With nearly all of Ocean’s portfolio of digital screens situated across prime retail and urban roadside locations, the Group has been able to fully capitalise on the recovery. Footfall across prime retail destinations, such as Westfield shopping malls and major city centres, has come back strongly whilst roadside traffic across most of our territories was back to pre-pandemic levels by the year end.  

In terms of recovery trends across the company’s territories since the half year, bookings and demand in the Netherlands and Nordics have continued to improve. All territories recorded a strong Q4, the Group’s key trading period, with revenues up by 67.5% compared to Q4 2020 and 7.2% compared to Q4 2019, illustrating the strength of the ongoing recovery.

As well as the return of established users of DOOH, Ocean has seen an increasing number of new adopters, driven by changing consumer behaviour as well as the product ‘Deepscreen’, Ocean’s 3D screen development. Since launching in the summer on the Piccadilly Lights, Deepscreen has been rolled out across Ocean’s large format full motion screens across all our territories to huge effect. 

In terms of organic growth, the Group signed a series of new contracts across all territories during 2021. Some of the most high-profile included being appointed outdoor media partner for the St James Quarter in Edinburgh, a 10-year DOOH contract with a lifetime value of £25 million; becoming the exclusive outdoor media partner for the Canary Wharf Group, with long-term contract value of £30 million, and being appointed strategic media partner for Fisketorvet, Copenhagen's premium shopping, dining and leisure destination, which carries a lifetime value of £7 million.

Strategic review

On 15 November 2021, Ocean announced that it had initiated a strategic review to evaluate potential strategic and financial alternatives to maximise shareholder value. This decision was taken after the Board and management felt that Ocean was undervalued, with the share price continuing to face technical trading challenges unrelated to Ocean's strong business fundamentals and intrinsic value. The Board is continuing to evaluate a number of options, including a potential sale, following interest and conditional offers received which may or may not lead to a transaction. Another update will be made when appropriate, says the company’s media release.

Commenting on Ocean’s performance, CEO Tim Bleakley said: “The medium went from strength to strength during 2021 as Covid restrictions were lifted and vaccination programmes rolled out. As populations were liberated the advertisers targeted out of home, with audiences coming back fast and strong in the environments where Ocean is focussed. 

“Ocean was at the forefront of driving the recovery, with DOOH playing the most significant role by providing a high impact and dynamic means to target highly valuable audiences efficiently and cost effectively. We have helped to deliver memorable, engaging campaigns that transcend the physical display, with images captured and shared across multiple online news and mobile platforms, on both a national and global scale. The pandemic has seen the medium underpin its value as a vital amplifier of other media platforms that either cannot reach younger demographics as effectively or deliver the broadcast brand fame the DOOH medium is so strong for.

“Ocean has also combined the fast audience recovery environments of prime retail and urban roadside locations with unique innovations, such as our immersive 3D Deepscreen proposition, which has been launched across multiple countries. All this though has been underpinned by the incredible efforts of Ocean’s people, who have been amongst some of the most passionate and committed work forces in any sector to return to working out of home.”

Outlook and current trading 

Despite commencing the year with Omicron and restrictions to leisure and hospitality across some of our countries, trading has started very strongly. “We currently expect revenue and adjusted EBITDA for FY2022 to be ahead of FY2019 reflecting the return of audiences and brands to OOH environments,” states the release.