What changed in this filing

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Item 2. Management’s Discussion and Analysis

2020-11-05 compared with 2020-08-06 · 248 added, 234 removed, 518 unchanged (48% of the section changed)

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The forward-looking statements are subject to a number of important factors, including, but not limited to, those factors discussed in the sections entitled “Risk Factors” in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on February 26, 2020, and the section entitled “Cautionary Statement Regarding Forward-Looking Statements” in this Quarterly Report on Form 10-Q, that could cause our actual results to differ materially from the results described herein or implied by such forward-looking statements .

Except as otherwise indicated or unless the context otherwise requires, all references in this Quarterly Report on Form 10-Q to (i) “OUTFRONT Media,” “the Company,” “we,” “our,” “us” and “our company” mean OUTFRONT Media Inc., a Maryland corporation, and unless the context requires otherwise, its consolidated subsidiaries, and (ii) the “25 largest markets in the U.S.,” “150 markets in the U.S.

and Canada” and “Nielsen Designated Market Areas” are based, in whole or in part, on Nielsen Media Research’s Designated Market Area rankings as of January 1, 2020.

OUTFRONT Media is a real estate investment trust (“REIT”), which provides advertising space (“displays”) on out-of-home advertising structures and sites in the United States (the “U.S.”) and Canada.

We manage our operations through three operating segments—(1) U.S.

We currently manage our operations through two operating segments—U.S.

Billboard and Transit, which is included in our U.S.

Media reportable segment, (2) International and (3) Sports Marketing.

International and Sports Marketing do not meet the criteria to be a reportable segment and accordingly, are both included in Other (see Note 19.

Media reportable segment, and International.

International does not meet the criteria to be a reportable segment and accordingly, is included in Other (see Note 19.

Segment Information to the Consolidated Financial Statements).

In the third quarter of 2020, we sold all of our equity interests in certain of our subsidiaries (the “Sports Disposition”), which held all of the assets of our Sports Marketing operating segment, for a purchase price of approximately $34.6 million in cash, subject to closing and post-closing adjustments.

The Sports Marketing operating segment was the marketing and multimedia rights holder for a variety of colleges, universities and other educational institutions across the United States.

The operating results of our Sports Marketing operating segment through June 30, 2020, are included in our Consolidated Financial Statements and are included in Other in our segment reporting.

We are one of the largest providers of advertising space on out-of-home advertising structures and sites across the U.S.

Our inventory consists of billboard displays, which are primarily located on the most heavily traveled highways and roadways in top Nielsen Designated Market Areas (“DMAs”), and transit advertising displays operated under exclusive multi-year contracts with municipalities in large cities across the U.S.

We also have marketing and multimedia rights agreements with colleges, universities and other educational institutions, which entitle us to operate on-campus advertising displays, as well as manage marketing opportunities, media rights and experiential entertainment at sporting events.

In total, we have displays in all of the 25 largest markets in the U.S.

and 150 markets in the U.S.

and approximately 150 markets in the U.S.

Our top market, high profile location focused portfolio includes sites in and around both Grand Central Station and Times Square in New York, various locations along Sunset Boulevard in Los Angeles, and the Bay Bridge in San Francisco.

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We provide our customers with a differentiated advertising solution at an attractive price point relative to other forms of advertising.

In addition to leasing displays, we provide other value-added services to our customers, such as pre-campaign category research, consumer insights, print production and post-campaign tracking and analytics.

Media segment generated 11% of its revenues in the New York City metropolitan area in the three months ended June 30, 2020, 23% in the three months ended June 30, 2019, 18% in the six months ended June 30, 2020 and 23% in the six months ended June 30, 2019, and generated 15% in the Los Angeles metropolitan area in the three months ended June 30, 2020, 15% in the three months ended June 30, 2019, 15% in the six months ended June 30, 2020 and 16% in the six months ended June 30, 2019.

In the three months ended June 30, 2020, our U.S.

In addition to leasing displays, we provide other value-added

services to our customers, such as pre-campaign category research, consumer insights, print production and post-campaign tracking and analytics.

Media segment generated 12% of its revenues in the New York City metropolitan area in the three months ended September 30, 2020, 22% in the three months ended September 30, 2019, 16% in the nine months ended September 30, 2020 and 23% in the nine months ended September 30, 2019, and generated 15% in the Los Angeles metropolitan area in the three months ended September 30, 2020, 16% in the three months ended September 30, 2019, 15% in the nine months ended September 30, 2020 and 16% in the nine months ended September 30, 2019.

In the three months ended September 30, 2020, our U.S.

Media segment generated $265.8 million of Revenues and $74.2 million of Operating income before Depreciation , Amortization , Net gain on dispositions , Stock-based compensation and Restructuring charges (“Adjusted OIBDA”).

In the three months ended June 30, 2019, our U.S.

In the three months ended September 30, 2019, our U.S.

Media segment generated $422.7 million of Revenues and $147.3 million of Adjusted OIBDA.

In the six months ended June 30, 2020, our U.S.

In the nine months ended September 30, 2020, our U.S.

Media segment generated $834.0 million of Revenues and $202.4 million of Adjusted OIBDA.

In the six months ended June 30, 2019, our U.S.

In the nine months ended September 30, 2019, our U.S.

Media segment generated $1,180.7 million of Revenues and $387.7 million of Adjusted OIBDA.

(See the “Segment Results of Operations” section of this MD&A.)

Other (includes International and Sports Marketing).

In the three months ended June 30, 2020, Other generated $19.4 million of Revenues and an Adjusted OIBDA loss of $5.4 million.

In the three months ended June 30, 2019, Other generated $40.3 million of Revenues and $8.8 million of Adjusted OIBDA.

In the six months ended June 30, 2020, Other generated $50.0 million of Revenues and an Adjusted OIBDA loss of $4.9 million.

In the six months ended June 30, 2019, Other generated $73.6 million of Revenues and $10.0 million of Adjusted OIBDA.

Other (includes International and through June 30, 2020, Sports Marketing).

In the three months ended September 30, 2020, Other generated $16.5 million of Revenues and $3.2 million of Adjusted OIBDA.

In the three months ended September 30, 2019, Other generated $39.8 million of Revenues and $4.3 million of Adjusted OIBDA.

In the nine months ended September 30, 2020, Other generated $66.5 million of Revenues and an Adjusted OIBDA loss of $1.7 million.

In the nine months ended September 30, 2019, Other generated $113.4 million of Revenues and $14.3 million of Adjusted OIBDA.

COVID-19 Impact

The novel coronavirus (COVID-19) pandemic and the related preventative measures taken to help curb the spread, including shutdowns and slowdowns of, and restrictions on, businesses, public gatherings, social interactions and travel (including reductions in foot traffic, roadway traffic and transit commuting) throughout the markets in which we do business have had, and may continue to have, a significant impact on the global economy and our business.

The novel coronavirus (COVID-19) pandemic and the related preventative measures taken to help curb the spread, including shutdowns and slowdowns of, and restrictions on, businesses, public gatherings, social interactions and travel (including reductions in foot traffic, roadway traffic, transit commuting and overall target audiences) throughout the markets in which we do business have had, and may continue to have, a significant impact on the global economy and our business.

Though generally we remain able to continue to sell and service our displays, our business operates billboard and transit franchise agreements in the top DMAs, such as New York and Los Angeles, where the COVID-19 pandemic has had a particularly significant impact.

The COVID-19 pandemic has (i) interrupted our ability to build and deploy advertising structures and sites, including digital displays;

The COVID-19 pandemic has (i) delayed our ability to build and deploy advertising structures and sites, including digital displays;

(ii) reduced or curtailed our customers’ advertising expenditures and overall demand for our services through purchase cancellations or otherwise;

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Media segment and with respect to our transit and other business.

Additionally, we expect transit franchise expenses, billboard property lease expenses and posting, maintenance and other expenses, such as rental expenses and minimum annual guarantee payments, to materially increase as a percentage of revenues more than historical levels, as revenues decline in 2020.

We expect the impacts described above to be greater in the second quarter of 2020 than in the third and fourth quarters of 2020.

Accordingly, results for the three and six months ended June 30, 2020, are not indicative of the results that may be expected for the fiscal year ending December 31, 2020.

Additionally, we expect transit franchise expenses, billboard property lease expenses and posting, maintenance and other expenses, such as rental expenses and transit franchise payments, to materially increase as a percentage of revenues more than historical levels, as revenues decline in 2020.

We expect the impacts described above to be greatest in the second quarter of 2020, with incremental improvement in the third and fourth quarters of 2020.

Accordingly, results for the three and nine months ended September 30, 2020, are not indicative of the results that may be expected for the fiscal year ending December 31, 2020.

In response to the COVID-19 pandemic, we have prioritized the health and safety of our employees and customers by (i) shifting to a secure remote workforce for all personnel other than operations personnel who service our displays and certain other personnel, (ii) implementing deep cleaning, social distancing and other protective policies and practices in accordance with federal, state and local regulations and guidance across all offices and facilities that are open or in the process of reopening, (iii) restricting non-essential business travel, and (iv) communicating frequently with our employees and customers to address any concerns.

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In addition, in order to preserve financial flexibility, increase liquidity and reduce expenses in light of the current uncertainty in the global economy and our business, we have modified our business goals and undertaken the following actions, which should be read in conjunction with the “—Analysis of Results of Operations” and “—Liquidity and Capital Resources” sections of this MD&A:

• Borrowed $470.0 million under the Revolving Credit Facility (as defined below), which was repaid in full as of June 30, 2020, using the net proceeds from the offering of the Notes (as defined below) and cash on hand;

• Repaid in full all borrowings under the Revolving Credit Facility (as defined below) as of June 30, 2020, using the net proceeds from the offering of the Notes (as defined below) and cash on hand;

• Accessed the capital markets and raised $400.0 million, before expenses, in the Private Placement (as defined below) and issued $400.0 million aggregate principal amount of 6.250% Senior Unsecured Notes due 2025 (the “Notes”);

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• Suspended our quarterly dividend payments on our common stock, subject to the minimum annual REIT distribution requirement;

• Suspended our deployment of digital transit displays to reduce costs that may or may not be recoverable from customer sales or transit franchise partners, except with respect to the New York Metropolitan Transportation Authority (the “MTA”), with which we recommenced deployment in the third quarter of 2020;

• Suspended or delayed our deployment of digital transit displays to reduce costs that may or may not be recoverable from customer sales or transit franchise partners;

• Reduced maintenance capital expenditures (other than for necessary safety-related projects) and growth capital expenditures for digital billboard display conversions;

• Paused new acquisition activity;

• Reduced our posting, maintenance and other, and SG&A (as defined below) expenses through restrictions on discretionary expenses, a hiring freeze, workforce reductions, employee furloughs, temporary reductions to certain employee base salaries, and temporary reductions to the base salaries of our Chief Executive Officer and other executive officers by 50% and 20%, respectively, as well as to the cash compensation of our non-employee directors by 20%, to offset expected decreases in revenues in 2020.

In addition, we have engaged, and will continue to engage, in constructive conversations with our billboard ground lease landlords, transit franchise partners and multimedia rights partners to mitigate increases as a percentage of revenues in billboard property lease expenses, transit franchise expenses and posting, maintenance and other expenses.

Though we rely on third parties to manufacture and transport our digital displays, and have not experienced any significant supply chain or logistical disruptions, we do, however, expect delays as a result of the COVID-19 pandemic in receiving digital displays as we reinstate our digital billboard display conversions and deployment of digital transit displays.

• Have taken a highly selective approach to new acquisition activity;

• Reduced our posting, maintenance and other, and SG&A (as defined below) expenses through restrictions on discretionary expenses, a hiring freeze, workforce reductions, employee furloughs and temporary reductions to the base salaries of certain employees and our executive officers (which ended in September 2020), as well as to the cash compensation of our non-employee directors (which ended in October 2020), to offset expected decreases in revenues in 2020.

In addition, we have engaged, and will continue to engage, in constructive conversations with our billboard ground lease landlords and transit franchise partners to mitigate increases as a percentage of revenues in billboard property lease expenses, transit franchise expenses and posting, maintenance and other expenses.

Though we rely on third parties to manufacture and transport our digital displays, and have not experienced any significant supply chain or logistical disruptions, we may experience delays as a result of the COVID-19 pandemic in receiving digital displays as we continue to reinstate our digital billboard display conversions and deployment of digital transit displays.

We continue to monitor the rapidly evolving situation and guidance from federal, state and local public health authorities and may take additional actions based on their recommendations.

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Increasing the number of digital displays in our prime audience locations is an important element of our organic growth strategy, as digital displays have the potential to attract additional business from both new and existing customers.

We believe digital displays are attractive to our customers because they allow for the development of richer and more visually engaging

messages, provide our customers with the flexibility both to target audiences by time of day and to quickly launch new advertising campaigns, and eliminate or greatly reduce print production and installation costs.

We believe digital displays are attractive to our customers because they allow for the development of richer and more visually engaging messages, provide our customers with the flexibility both to target audiences by time of day and to quickly launch new advertising campaigns, and eliminate or greatly reduce print production and installation costs.

In addition, digital displays enable us to run multiple advertisements on each display.

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Subject to the impact of the COVID-19 pandemic, we intend to incur significant equipment deployment costs and capital expenditures in the coming years to continue increasing the number of digital displays in our portfolio.

We have built or converted 23 new digital billboard displays in the United States and 2 in Canada during the six months ended June 30, 2020.

Additionally, in the six months ended June 30, 2020, we entered into marketing arrangements to sell advertising on 20 third-party digital billboard displays in the U.S.

We have built or converted 47 new digital billboard displays in the United States and 2 in Canada during the nine months ended September 30, 2020.

Additionally, in the nine months ended September 30, 2020, we entered into marketing arrangements to sell advertising on 20 third-party digital billboard displays in the U.S.

and 29 in Canada.

In the six months ended June 30, 2020, we have built, converted or replaced 884 digital transit and other displays in the United States.

As described above, as a result of the COVID-19 pandemic, we reduced our digital billboard display conversions and suspended our deployment of digital transit displays (except with respect to the MTA, with which we recommenced deployment in the third quarter of 2020).

In the nine months ended September 30, 2020, we have built, converted or replaced 1,699 digital transit and other displays in the United States.

As described above, as a result of the COVID-19 pandemic, we reduced our digital billboard display conversions and suspended or delayed our deployment of digital transit displays.

The following table sets forth information regarding our digital displays.

Digital Revenues (in millions)

for the Six Months Ended

June 30, 2020 (a)

for the Nine Months Ended

September 30, 2020 (a)

Number of Digital Displays as of

June 30, 2020 (a)

September 30, 2020 (a)

Location Digital Billboard Digital Transit and Other Total Digital Revenues Digital Billboard Displays Digital Transit and Other Displays Total Digital Displays

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Total $ 142.9 $ 41.9 $ 184.8 1,419 7,859 9,278

(a) Digital display amounts (1) include 2,581 displays reserved for transit agency use and (2) exclude all displays under our multimedia rights agreements with colleges, universities and other educational institutions.

(a) Digital display amounts include 2,941 displays reserved for transit agency use.

Our number of digital displays is impacted by acquisitions, dispositions, management agreements, the net effect of new and lost billboards, and the net effect of won and lost franchises in the period.

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We have a diversified base of customers across various industries.

During the three months ended June 30, 2020, our largest categories of advertisers were professional services, healthcare/pharmaceuticals and retail, which represented approximately 11%, 10% and 8% of our total U.S.

Media segment revenues, respectively.

During the three months ended June 30, 2019, our largest categories of advertisers were retail, computers/internet and professional services, each of which represented approximately 9%, 8% and 8% of our total U.S.

Media segment revenues, respectively.

During the six months ended June 30, 2020, our largest categories of advertisers were professional services, healthcare/pharmaceuticals and retail, which represented approximately 10%, 9% and 8% of our total U.S.

During the three months ended September 30, 2020, our largest categories of advertisers were professional services, healthcare/pharmaceuticals and retail, which represented approximately 11%, 9% and 8% of our total U.S.

Media segment revenues, respectively.

During the six months ended June 30, 2019, our largest categories of advertisers were retail, professional services and computers/internet, each of which represented approximately 9%, 8% and 8% of our total U.S.

During the three months ended September 30, 2019, our largest categories of advertisers were financial services, retail and professional services, each of which represented approximately 8% of our total U.S.

Media segment revenues.

During the nine months ended September 30, 2020, our largest categories of advertisers were professional services, healthcare/pharmaceuticals and retail, each of which represented approximately 10%, 9% and 8% of our total U.S.

Media segment revenues, respectively.

During the nine months ended September 30, 2019, our largest categories of advertisers were retail, professional services and computers/internet, each of which represented approximately 8% of our total U.S.

Media segment revenues.

Our large-scale portfolio allows our customers to reach a national audience and also provides the flexibility to tailor campaigns to specific regions or markets.

In the three months ended June 30, 2020, we generated approximately 39% of our U.S.

In the three months ended September 30, 2020, we generated approximately 38% of our U.S.

Media segment revenues from national advertising campaigns compared to approximately 46% in the same prior-year period.

In the six months ended June 30, 2020, we generated approximately 41% of our U.S.

In the nine months ended September 30, 2020, we generated approximately 40% of our U.S.

Media segment revenues from national advertising campaigns compared to approximately 44% in the same prior-year period.

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We believe these non-GAAP performance indicators are meaningful supplemental measures of our operating performance and should not be considered in isolation of, or as a substitute for, their most directly comparable GAAP financial measures.

Three Months Ended Six Months Ended

June 30, % June 30, %

Three Months Ended Nine Months Ended

September 30, % September 30, %

(in millions, except percentages) 2020 2019 Change 2020 2019 Change

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282.3 451.1 (37) 874.9 1,252.7 (30)

Operating income (loss)

(25.9) 88.7 * 7.9 125.6 (94)

Operating income 25.1 85.5 (71) 33.0 211.1 (84)

Adjusted OIBDA (b)

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• Calculation is not meaningful.

(a) Organic revenues exclude the impact of foreign currency exchange rates (“non-organic revenues”).

(a) Organic revenues exclude revenues associated with a disposition and the impact of foreign currency exchange rates (“non-organic revenues”).

We provide organic revenues to understand the underlying growth rate of revenue excluding the impact of non-organic revenue items.

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Organic revenues, as we calculate it, may not be comparable to similarly titled measures employed by other companies.

(b) See the “Reconciliation of Non-GAAP Financial Measures” and “Revenues” sections of this MD&A for reconciliations of Operating income to Adjusted OIBDA, Net income attributable to OUTFRONT Media Inc.

(b) See the “Reconciliation of Non-GAAP Financial Measures” and “Revenues” sections of this MD&A for reconciliations of Operating income to Adjusted OIBDA, Net income (loss) attributable to OUTFRONT Media Inc.

to FFO attributable to OUTFRONT Media Inc.

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AFFO also includes cash paid for maintenance capital expenditures since these are routine uses of cash that are necessary for our operations.

In addition, AFFO excludes restructuring charges, as well as certain non-cash items, including non-real estate depreciation and amortization, stock-based compensation expense, accretion expense, the non-cash effect of straight-line rent, amortization of deferred financing costs and the same adjustments for our non-controlling interests, as well as the non-cash portion of income taxes, and the related income tax effect of adjustments, as applicable.

In addition, AFFO excludes restructuring charges and losses on extinguishment of debt, as well as certain non-cash items, including non-real estate depreciation and amortization, a gain on disposition of non-real estate assets, stock-based compensation expense, accretion expense, the non-cash effect of straight-line rent, amortization of deferred financing costs and the same adjustments for our non-controlling interests, as well as the non-cash portion of income taxes, and the related income tax effect of adjustments, as applicable.

We use FFO and AFFO measures for managing our business and for planning and forecasting future periods, and each is an important indicator of our operational strength and business performance, especially compared to other REITs.

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Reconciliation of Non-GAAP Financial Measures

The following table reconciles Operating income (loss) to Adjusted OIBDA, and Net income (loss) attributable to OUTFRONT Media Inc.

The following table reconciles Operating income to Adjusted OIBDA, and Net income (loss) attributable to OUTFRONT Media Inc.

to FFO attributable to OUTFRONT Media Inc.

and AFFO attributable to OUTFRONT Media Inc.

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

(in millions, except per share amounts) 2020 2019 2020 2019

Total revenues $ 282.3 $ 462.5 $ 900.5 $ 1,294.1

Operating income (loss) $ (25.9) $ 88.7 $ 7.9 $ 125.6

Operating income $ 25.1 $ 85.5 $ 33.0 $ 211.1

Restructuring charges (a)

0.6 — 5.3 0.3

Net (gain) loss on dispositions (5.2) 0.4 (5.3) (1.1)

Net gain on dispositions (8.0) (1.9) (13.3) (3.0)

Depreciation 21.0 22.4 63.2 64.9

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Amortization of direct lease acquisition costs 9.1 13.6 26.7 36.9

Net (gain) loss on disposition of real estate assets

(5.2) 0.4 (5.3) (1.1)

Net gain on disposition of real estate assets (0.8) (1.9) (6.1) (3.0)

Adjustment related to non-controlling interests — — (0.2) —

(0.1) — (0.2) —

Adjustment related to equity-based investments — — — 0.1

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Other amortization 3.0 3.5 9.2 10.7

Gain on disposition of non-real estate assets (c)

(7.2) — (7.2) —

Stock-based compensation (a)

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1.8 1.9 4.8 4.9

Loss on extinguishment of debt — 11.0 — 11.0

Adjustment related to non-controlling interests

(0.1) — (0.1) —

Income tax effect of adjustments (c)

(0.4) — (0.4) —

Income tax effect of adjustments (d)

AFFO attributable to OUTFRONT Media Inc.

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(b) Income tax effect related to Net gain on disposition of real estate assets.

FFO in the three months ended June 30, 2020, was a deficit of $27.9 million compared to FFO of $90.6 million in the same prior-year period.

AFFO in the three months ended June 30, 2020, was a deficit of $21.3 million compared to AFFO of $96.3 million in the same prior-year period.

FFO in the six months ended June 30, 2020, of $16.8 million decreased $115.9 million, or

87%, compared to the same prior-year period.

AFFO in the six months ended June 30, 2020, of $18.7 million decreased $116.8 million, or 86%, compared to the same prior-year period.

(See Note 13.

Acquisitions and Dispositions :

Dispositions to the Consolidated Financial Statements.)

(d) Income tax effect related to Restructuring charges - severance and Gain on disposition of non-real estate assets.

FFO in the three months ended September 30, 2020, of $22.6 million decreased $56.4 million, or 71%, compared to the same prior-year period.

AFFO in the three months ended September 30, 2020, of $27.7 million decreased $64.9 million, or 70%, compared to the same prior-year period.

FFO in the nine months ended September 30, 2020, of $39.4 million decreased $172.3 million, or 81%, compared to the same prior-year period.

AFFO in the nine months ended September 30, 2020, of $46.4 million decreased $181.7 million, or 80%, compared to the same prior-year period.

The decreases were primarily due to the impact of the COVID-19 pandemic on revenues, partially offset by cost reduction measures taken in response to the COVID-19 pandemic.

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Revenues to the Consolidated Financial Statements.)

Three Months Ended Six Months Ended

June 30, % June 30, %

Three Months Ended Nine Months Ended

September 30, % September 30, %

(in millions, except percentages) 2020 2019 Change 2020 2019 Change

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• Calculation is not meaningful.

(a) Organic revenues exclude the impact of foreign currency exchange rates (“non-organic revenues”).

Total revenues decreased $227.0 million, or 49%, and organic revenues decreased $226.2 million, or 49%, in the three months ended June 30, 2020, compared to the same prior-year period.

Total revenues decreased by $213.4 million, or 26%, and organic revenues decreased $212.4 million, or 26%, in the six months ended June 30, 2020, compared to the same prior-year period.

In each of the three and six months ended June 30, 2019, non-organic revenues reflect the impact of foreign currency exchange rates.

Total billboard revenues decreased $117.3 million, or 38%, in the three months ended June 30, 2020, compared to the same prior-year period and decreased $97.4 million, or 17%, in the six months ended June 30, 2020, compared to the same prior-year period.

(a) Organic revenues exclude revenues associated with a disposition and the impact of foreign currency exchange rates (“non-organic revenues”).

Total revenues decreased $180.2 million, or 39%, and organic revenues decreased $168.8 million, or 37%, in the three months ended September 30, 2020, compared to the same prior-year period.

Total revenues decreased by $393.6 million, or 30%, and organic revenues decreased $377.8 million, or 30%, in the nine months ended September 30, 2020, compared to the same prior-year period.

In the nine months ended September 30, 2020, non-organic revenues exclude the impact of the Sports Disposition.

In the three and nine months ended September 30, 2019, non-organic revenues exclude the impact of the Sports Disposition and reflect the impact of foreign currency exchange rates.

Total billboard revenues decreased $72.1 million, or 23%, in the three months ended September 30, 2020, compared to the same prior-year period and decreased $169.5 million, or 20%, in the nine months ended September 30, 2020, compared to the same prior-year period.

The decreases were principally driven by a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise.

Organic billboard revenues in the three months ended June 30, 2020, decreased $116.7 million, or 38%, compared to the same prior-year period and decreased $96.6 million, or 17%, in the six months ended June 30, 2020, compared to the same prior-year period.

Organic billboard revenues in the three months ended September 30, 2020, decreased $71.8 million, or 23%, compared to the same prior-year period and decreased $168.4 million, or 19%, in the nine months ended September 30, 2020, compared to the

same prior-year period.

Total transit and other revenues decreased $109.7 million, or 71%, in the three months ended June 30, 2020, compared to the same prior-year period and decreased $116.0 million, or 42%, in the six months ended June 30, 2020, compared to the same

prior-year period.

The decreases were driven by a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise.

The decrease in organic transit and other revenues in each of the three and six months ended June 30, 2020, compared to the same prior-year period, is due to a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise.

Three Months Ended Six Months Ended

June 30, % June 30, %

Total transit and other revenues decreased $108.1 million, or 72%, in the three months ended September 30, 2020, compared to the same prior-year period and decreased $224.1 million, or 53%, in the nine months ended September 30, 2020, compared to the same prior-year period.

The decrease in organic transit and other revenues in each of the three and nine months ended September 30, 2020, compared to the same prior-year period, is due to a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise and a decrease in third-party digital equipment sales.

Three Months Ended Nine Months Ended

September 30, % September 30, %

(in millions, except percentages) 2020 2019 Change 2020 2019 Change

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Restructuring charges 0.6 — * 5.3 0.3 *

Net (gain) loss on dispositions (5.2) 0.4 * (5.3) (1.1) *

Net gain on dispositions (8.0) (1.9) * (13.3) (3.0) *

Depreciation 21.0 22.4 (6) 63.2 64.9 (3)

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Operating Expenses

Three Months Ended Six Months Ended

June 30, % June 30, %

Three Months Ended Nine Months Ended

September 30, % September 30, %

(in millions, except percentages) 2020 2019 Change 2020 2019 Change

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Total operating expenses $ 155.8 $ 245.5 (37) $ 534.6 $ 702.7 (24)

Billboard property lease expenses represented 50% of billboard revenues in the three months ended June 30, 2020, 33% in the three months ended June 30, 2019, 43% in the six months ended June 30, 2020, and 36% in the six months ended June 30, 2019.

Transit franchise expenses represented 63% of transit display revenues in the three months ended June 30, 2020, 59% in the three months ended June 30, 2019, 62% in the six months ended June 30, 2020 and 60% in the six months ended June 30, 2019.

The increase in transit franchise expense as a percentage of revenues is primarily driven by an amendment to the MTA agreement, which resulted in the payment of an increased revenue share percentage instead of guaranteed minimum annual payments for the three months ended June 30, 2020.

Billboard property lease and transit franchise expenses decreased $62.7 million in the three months ended June 30, 2020, compared to the same prior-year period.

Billboard property lease and transit franchise expenses decreased $56.2 million in the six months ended June 30, 2020, compared to the same prior-year period.

The decreases were due primarily to lower billboard and transit revenues resulting from the impact of the COVID-19 pandemic and lower transit franchise expenses paid to the MTA in the three months ended June 30, 2020.

Posting, maintenance and other expenses decreased $23.6 million, or 36%, in the three months ended June 30, 2020, compared to the same prior-year period and decreased $22.2 million, or 17%, in the six months ended June 30, 2020, compared to the same prior-year period.

The decreases were primarily due to the impact of the COVID-19 pandemic and the related restrictions

in the top DMAs reducing or curtailing customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise.

Billboard property lease expenses represented 40% of billboard revenues in the three months ended September 30, 2020, 33% in the three months ended September 30, 2019, 42% in the nine months ended September 30, 2020, and 35% in the nine months ended September 30, 2019.

Transit franchise expenses represented 59% of transit display revenues in the three months ended September 30, 2020, 57% in the three months ended September 30, 2019, 62% in the nine months ended September 30, 2020 and 59% in the nine months ended September 30, 2019.

The increase in transit franchise expense as a percentage of revenues is primarily driven by an amendment to our agreement with the New York Metropolitan Transportation Authority (“the MTA”), which resulted in the payment of an increased revenue share percentage instead of guaranteed minimum annual payments for second and third quarters of 2020.

Billboard property lease and transit franchise expenses decreased $58.0 million in the three months ended September 30, 2020, compared to the same prior-year period.

Billboard property lease and transit franchise expenses decreased $114.2 million in the

nine months ended September 30, 2020, compared to the same prior-year period.

The decreases were due primarily to lower billboard and transit revenues resulting from the impact of the COVID-19 pandemic and the impact of agreements with landlords and transit franchise partners to modify our existing minimum lease payments and guaranteed minimum annual payments to revenue share percentages in the second and third quarters of 2020.

Posting, maintenance and other expenses decreased $31.7 million, or 45%, in the three months ended September 30, 2020, compared to the same prior-year period and decreased $53.9 million, or 27%, in the nine months ended September 30, 2020, compared to the same prior-year period.

The decreases were primarily due to the impact of the COVID-19 pandemic and the related restrictions in the top DMAs reducing or curtailing customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise, the impact of the Sports Disposition and lower costs related to third-party digital equipment sales.

Selling, General and Administrative Expenses (“SG&A”)

SG&A expenses represented 27% of Revenues in the three months ended June 30, 2020, and 18% in the same prior-year period.

SG&A expenses decreased $19.1 million, or 23%, in the three months ended June 30, 2020, compared to the same prior-year period.

SG&A expenses represented 23% of Revenues in the six months ended June 30, 2020 and 19% in the same prior-year period.

SG&A expenses decreased $12.9 million, or 8%, in the six months ended June 30, 2020, compared to the same prior-year period.

The decreases were primarily driven by lower compensation-related costs and lower professional fees, primarily as a result of cost reduction measures taken in response to the COVID-19 pandemic, partially offset by a higher provision for doubtful allowances.

Net (Gain) Loss on Dispositions

Net gain on dispositions was $5.2 million for the three months ended June 30, 2020, compared to a Net loss on dispositions of $0.4 million for the same prior-year period.

Net gain on dispositions was $5.3 million for the six months ended June 30, 2020, compared to $1.1 million for the same prior-year period.

The gain for the three and six months ended June 30, 2020, was primarily related to the sale of an office location in Canada.

The gain for the six months ended June 30, 2019, primarily related to the sale of an office location in the U.S.

Depreciation decreased $0.2 million, or 1% in the three months ended June 30, 2020, compared to the same prior-year period and decreased $0.3 million, or 1%, in the six months ended June 30, 2020, compared to the same prior-year period.

Amortization decreased $5.9 million, or 21%, in the three months ended June 30, 2020, compared to the same prior-year period, principally driven by lower direct lease acquisition costs, partially offset by higher amortization of intangible assets.

Amortization of direct lease acquisition costs was $6.3 million in the three months ended June 30, 2020 and $13.0 million in the same prior-year period.

Amortization decreased $4.3 million, or 8%, in the six months ended June 30, 2020, compared to the same prior-year period, principally driven by lower direct lease acquisition costs, partially offset by higher amortization of intangible assets.

Amortization of direct lease acquisition costs was $17.6 million in the six months ended June 30, 2020 and $23.3 million in the same prior-year period.

SG&A expenses represented 22% of Revenues in the three months ended September 30, 2020, and 18% in the same prior-year period.

SG&A expenses decreased $18.9 million, or 23%, in the three months ended September 30, 2020, compared to the same prior-year period.

SG&A expenses represented 23% of Revenues in the nine months ended September 30, 2020 and 18% in the same prior-year period.

SG&A expenses decreased $31.8 million, or 13%, in the nine months ended September 30, 2020, compared to the same prior-year period.

The decreases were primarily driven by lower compensation-related costs and lower professional fees, primarily as a result of cost reduction measures taken in response to the COVID-19 pandemic, and lower expenses resulting from the Sports Disposition, partially offset by a higher provision for doubtful allowances.

Net Gain on Dispositions

Net gain on dispositions was $8.0 million for the three months ended September 30, 2020, compared to $1.9 million for the same prior-year period.

Net gain on dispositions was $13.3 million for the nine months ended September 30, 2020, compared to $3.0 million for the same prior-year period.

The gain for the three and nine months ended September 30, 2020, was primarily related to a gain of $7.2 million related to the Sports Disposition.

For the nine months ended September 30, 2020, the gain also included the sale of an office location in Canada in the second quarter of 2020.

The gains for the nine months ended September 30, 2019, primarily related to the sales of office locations in the U.S.

Depreciation decreased $1.4 million, or 6% in the three months ended September 30, 2020, compared to the same prior-year period and decreased $1.7 million, or 3%, in the nine months ended September 30, 2020, compared to the same prior-year period.

Amortization decreased $4.3 million, or 15%, in the three months ended September 30, 2020, compared to the same prior-year period, principally driven by lower direct lease acquisition costs, partially offset by higher amortization of intangible assets.

Amortization of direct lease acquisition costs was $9.1 million in the three months ended September 30, 2020 and $13.6 million in the same prior-year period.

Amortization decreased $8.6 million, or 11%, in the nine months ended September 30, 2020, compared to the same prior-year period, principally driven by lower direct lease acquisition costs, partially offset by higher amortization of intangible assets.

Amortization of direct lease acquisition costs was $26.7 million in the nine months ended September 30, 2020 and $36.9 million in the same prior-year period.

Interest Expense, Net

Interest expense, net, was $33.3 million (including $1.7 million of deferred financing costs) in the three months ended June 30, 2020, and $33.9 million (including $1.6 million of deferred financing costs) in the same prior-year period.

Interest expense, net, was $63.1 million (including $3.0 million of deferred financing costs) in the six months ended June 30, 2020, and $66.6 million (including $3.0 million of deferred financing costs) in the same prior-year period.

The decrease in Interest expense, net, was primarily due to lower interest rates, partially offset by a higher outstanding average debt balance.

Benefit (Provision) for Income Taxes

Benefit for income taxes was $1.5 million in the three months ended June 30, 2020, compared to a Provision for income taxes of $6.2 million in the same prior-year period, due primarily to a taxable REIT subsidiary loss in the three months ended June 30, 2020, due to the impact of the COVID-19 pandemic.

Benefit for income taxes was $3.2 million in the six months ended June 30, 2020, compared to a Provision for income taxes of $5.2 million in the same prior-year period, due primarily to a taxable REIT subsidiary loss in the six months ended June 30, 2020.

Interest expense, net, was $34.2 million (including $1.8 million of deferred financing costs) in the three months ended September 30, 2020, and $33.9 million (including $1.9 million of deferred financing costs) in the same prior-year period.

The increase in Interest expense, net, in the three months ended September 30, 2020, compared to the same prior-year period was due primarily to a higher outstanding average debt balance, partially offset by lower interest rates.

Interest expense, net, was $97.3 million (including $4.8 million of deferred financing costs) in the nine months ended September 30, 2020, and $100.5 million (including $4.9 million of deferred financing costs) in the same prior-year period.

The decrease in Interest expense, net, in the nine months ended September 30, 2020, compared to the same prior-year period was primarily due to lower interest rates, partially offset by a higher outstanding average debt balance.

Provision for Income Taxes

Provision for income taxes of $3.5 million in the three months ended September 30, 2020, increased $0.2 million, or 6%, compared to the same prior-year period, due primarily to a gain related to the Sports Disposition.

Provision for income taxes of $0.3 million in the nine months ended September 30, 2020, decreased $8.2 million, or 96%, compared to the same prior-year period, due primarily to a taxable REIT subsidiary loss in the nine months ended September 30, 2020, partially offset by the gain related to the Sports Disposition.

Net Income (Loss)

Net loss before allocation to non-controlling interests was $58.0 million in the three months ended June 30, 2020, compared to Net income before allocation to non-controlling interests of $50.3 million in the same prior-year period, due primarily to a the impact of the COVID-19 pandemic, partially offset by the impact of cost reduction measures taken in response to the COVID-19 pandemic.

Net loss before allocation to non-controlling interests was $51.7 million in the six months ended June

30, 2020, compared Net income before allocation to non-controlling interests of $56.4 million in the same prior-year period, due primarily to the impact of the COVID-19 pandemic, partially offset by the impact of cost reduction measures taken in response and lower interest expense.

Net loss before allocation to non-controlling interests was $13.3 million in the three months ended September 30, 2020, compared to Net income before allocation to non-controlling interests of $38.7 million in the same prior-year period, due primarily to a the impact of the COVID-19 pandemic, partially offset by the impact of cost reduction measures taken in response to the COVID-19 pandemic and the gain related to the Sports Disposition.

Net loss before allocation to non-controlling interests was $65.0 million in the nine months ended September 30, 2020, compared Net income before allocation to non-controlling interests of $95.1 million in the same prior-year period, due primarily to the impact of the COVID-19 pandemic, partially offset by the impact of cost reduction measures taken in response, the gain related to the Sports Disposition and lower interest expense.

Segment Results of Operations

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Segment Information to the Consolidated Financial Statements.)

We manage our operations through three operating segments—(1) U.S.

We currently manage our operations through two operating segments—U.S.

Billboard and Transit, which is included in our U.S.

Media reportable segment, (2) International and (3) Sports Marketing.

International and Sports Marketing do not meet the criteria to be a reportable segment and accordingly, are both included in Other .

Media reportable segment, and International.

International does not meet the criteria to be a reportable segment and accordingly, is included in Other .

Our segment reporting therefore includes U.S.

Media and Other .

The following table presents our Revenues , Adjusted OIBDA and Operating income (loss) by segment in the three and six months ended June 30, 2020 and 2019.

Three Months Ended Six Months Ended

June 30, June 30,

The following table presents our Revenues , Adjusted OIBDA and Operating income (loss) by segment in the three and nine months ended September 30, 2020 and 2019.

In the third quarter of 2020, we completed the Sports Disposition.

Historical operating results for our Sports Marketing operating segment through June 30, 2020, are included in Other .

Three Months Ended Nine Months Ended

September 30, September 30,

(in millions) 2020 2019 2020 2019

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Total revenues $ 282.3 $ 462.5 $ 900.5 $ 1,294.1

Operating income (loss) $ (25.9) $ 88.7 $ 7.9 $ 125.6

Operating income $ 25.1 $ 85.5 $ 33.0 $ 211.1

Restructuring charges 0.6 — 5.3 0.3

Net (gain) loss on dispositions (5.2) 0.4 (5.3) (1.1)

Net gain on dispositions (8.0) (1.9) (13.3) (3.0)

Depreciation 21.0 22.4 63.2 64.9

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Corporate (14.3) (16.9) (41.1) (48.0)

Total operating income (loss) $ (25.9) $ 88.7 $ 7.9 $ 125.6

Three Months Ended Six Months Ended

June 30, % June 30, %

Total operating income $ 25.1 $ 85.5 $ 33.0 $ 211.1

Three Months Ended Nine Months Ended

September 30, % September 30, %

(in millions, except percentages) 2020 2019 Change 2020 2019 Change

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Adjusted OIBDA margin 28 % 35 % 24 % 33 %

Operating income (loss) $ (3.9) $ 101.9 * $ 43.5 $ 157.4 (72)

Operating income $ 31.9 $ 103.1 (69) $ 75.4 $ 260.5 (71)

Restructuring charges 0.4 — * 3.4 — *

Net (gain) loss on dispositions (1.1) 0.2 * (1.2) (1.3) (8)

Net gain on dispositions — (1.9) * (1.2) (3.2) (63)

Depreciation and amortization 41.9 46.1 (9) 124.8 130.4 (4)

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* Calculation is not meaningful.

Media segment revenues decreased $206.1 million, or 49%, in the three months ended June 30, 2020, compared to the same prior-year period.

In the three months ended June 30, 2020, we generated approximately 39% of our U.S.

Media segment revenues decreased $156.9 million, or 37%, in the three months ended September 30, 2020, compared to the same prior-year period.

In the three months ended September 30, 2020, we generated approximately 38% of our U.S.

Media segment revenues from national advertising campaigns and 46% in the same prior-year period.

Media segment revenues decreased $189.8 million, or 25%, in the six months ended June 30, 2020, compared to the same prior-year period.

In the six months ended June 30, 2020, we generated approximately 41% of our U.S.

Media segment revenues decreased $346.7 million, or 29%, in the nine months ended September 30, 2020, compared to the same prior-year period.

In the nine months ended September 30, 2020, we generated approximately 40% of our U.S.

Media segment revenues from national advertising campaigns and 44% in the same prior-year period.

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Revenues from U.S.

Media segment billboards decreased $103.7 million, or 36%, in the three months ended June 30, 2020, compared to the same prior-year period.

Media segment billboards decreased $66.8 million, or 23%, in the three months ended September 30, 2020, compared to the same prior-year period.

Revenues from U.S.

Media segment billboards decreased $83.4 million, or 16%, in the six months ended June 30, 2020, compared to the same prior-year period.

Media segment billboards decreased $150.2 million, or 18%, in the nine months ended September 30, 2020, compared to the same prior-year period.

The decreases reflect a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise.

Transit and other revenues in the U.S.

Media segment decreased $102.4 million, or 76%, in the three months ended June 30, 2020, compared to the same prior-year period and decreased $106.4 million, or 45%, in the six months ended June 30, 2020, compared to the same prior-year period.

Media segment decreased $90.1 million, or 69%, in the three months ended September 30, 2020, compared to the same prior-year period and decreased $196.5 million, or 54%, in the nine months ended September 30, 2020, compared to the same prior-year period.

Media segment operating expenses decreased $82.3 million, or 38%, in the three months ended June 30, 2020, compared to the same prior-year period.

Media segment SG&A expenses decreased $15.4 million, or 27%, in the three months ended June 30, 2020, compared to the same prior-year period.

Media segment operating expenses decreased $73.0 million, or 18%, in the six months ended June 30, 2020, compared to the same prior-year period.

Media segment SG&A expenses decreased $4.6 million, or 4%, in the six months ended June 30, 2020, compared to the same prior-year period.

Media segment operating expenses decreased $72.2 million, or 33%, in the three months ended September 30, 2020, compared to the same prior-year period.

Media segment SG&A expenses decreased $11.6 million, or 20%, in the three months ended September 30, 2020, compared to the same prior-year period.

Media segment operating expenses decreased $145.2 million, or 23%, in the nine months ended September 30, 2020, compared to the same prior-year period.

Media segment SG&A expenses decreased $16.2 million, or 10%, in the nine months ended September 30, 2020, compared to the same prior-year period.

The decreases in U.S.

Media segment operating expenses were primarily driven by lower billboard and transit revenues resulting from the impact of the COVID-19 pandemic and lower transit franchise expenses paid to the MTA in the three months ended June 30, 2020.

Media segment operating expenses were primarily driven by lower billboard and transit revenues resulting from the impact of the COVID-19 pandemic and the impact of agreements with landlords and transit franchise partners to modify our existing minimum lease payments and guaranteed minimum annual payments to revenue share percentages in the second and third quarters of 2020.

The decreases in U.S.

Media segment SG&A expenses were primarily driven by lower compensation-related costs and lower professional fees, primarily resulting from cost reduction measures taken in response to the COVID-19 pandemic, partially offset by a higher provision for doubtful allowances.

Media segment Adjusted OIBDA decreased $108.4 million, or 74%, in the three months ended June 30, 2020, compared to the same prior-year period.

Adjusted OIBDA margin was 18% in the three months ended June 30, 2020, and 35% in the same prior-year period.

Media segment Adjusted OIBDA decreased $112.2 million, or 47%, in the six months ended June 30, 2020, compared to the same prior-year period.

Adjusted OIBDA margin was 23% in the six months ended June 30, 2020, and 32% in the same prior-year period.

Three Months Ended Six Months Ended

June 30, % June 30, %

Media segment SG&A expenses were primarily

driven by lower compensation-related costs and lower professional fees, primarily resulting from cost reduction measures taken in response to the COVID-19 pandemic, partially offset by a higher provision for doubtful allowances.

Media segment Adjusted OIBDA decreased $73.1 million, or 50%, in the three months ended September 30, 2020, compared to the same prior-year period.

Adjusted OIBDA margin was 28% in the three months ended September 30, 2020, and 35% in the same prior-year period.

Media segment Adjusted OIBDA decreased $185.3 million, or 48%, in the nine months ended September 30, 2020, compared to the same prior-year period.

Adjusted OIBDA margin was 24% in the nine months ended September 30, 2020, and 33% in the same prior-year period.

Three Months Ended Nine Months Ended

September 30, % September 30, %

(in millions, except percentages) 2020 2019 Change 2020 2019 Change

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19 % 11 % (3) % 13 %

Operating income (loss)

Operating loss

$ 7.5 $ (0.7) * $ (1.3) $ (1.4) (7)

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* Calculation is not meaningful.

(a) Organic revenues exclude the impact of foreign currency exchange rates (“non-organic revenues”).

Total Other revenues decreased $20.9 million, or 52%, in the three months ended June 30, 2020, and decreased $23.6 million, or 32%, in the six months ended June 30, 2020, compared to the same prior-year periods, reflecting a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise, as well as the cancellation of spring sports at colleges and universities.

Other operating expenses decreased $4.0, or 17%, in the three months ended June 30, 2020, compared to the same prior-year period.

Other SG&A expenses decreased $2.7 million, or 32%, in the three months ended June 30, 2020, compared to the prior-year period.

Other operating expenses decreased $5.4 million, or 12%, in the six months ended June 30, 2020, compared to the same prior-year period.

Other SG&A expenses decreased $3.3 million, or 19%, in the six months ended June 30, 2020, compared to the prior-year period.

The decreases in Other operating expenses were primarily driven by lower billboard and transit revenues, and lower expenses related to our Sports Marketing operating segment.

The decreases in Other SG&A expenses were primarily driven by cost reduction measures taken in response to the COVID-19 pandemic.

Other incurred an Adjusted OIBDA loss of $5.4 million in the three months ended June 30, 2020, compared to Adjusted OIBDA of $8.8 million in the same prior-year period and incurred an Adjusted OIBDA loss of $4.9 million in the six months ended June 30, 2020, compared to Adjusted OIBDA of $10.0 million in the same prior-year period.

The decreases were due primarily to a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise, as well as the cancellation of spring sports at colleges and universities, partially offset by cost reduction measures taken in response to the COVID-19 pandemic.

(a) Organic revenues exclude revenues associated with a disposition and the impact of foreign currency exchange rates (“non-organic revenues”).

In the third quarter of 2020, we completed the Sports Disposition.

The operating results of our Sports Marketing operating segment through June 30, 2020, are included in our Consolidated Financial Statements.

Total Other revenues decreased $23.3 million, or 59%, in the three months ended September 30, 2020, and decreased $46.9 million, or 41%, in the nine months ended September 30, 2020, compared to the same prior-year periods, reflecting the Sports Disposition, a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise, as well as the cancellation of spring sports at colleges and universities and a decrease in third-party digital equipment sales.

In the nine months ended September 30, 2020, non-organic revenues exclude the impact of the Sports Disposition.

In the three and nine months ended September 30, 2019, non-organic revenues exclude the impact of the Sports Disposition and reflect the impact of foreign currency exchange rates.

Organic Other revenues decreased $11.9 million, or 42%, in the three months ended September 30, 2020, compared to the same prior-year period, reflecting a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise, and a decrease in third-party digital equipment sales.

Organic Other revenues decreased $31.1 million, or 43%, in the nine months ended September 30, 2020, compared to the same prior-year period, reflecting a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise, and a decrease in third-party digital equipment sales.

Other operating expenses decreased $17.5, or 64%, in the three months ended September 30, 2020, compared to the same prior-year period.

Other SG&A expenses decreased $4.7 million, or 58%, in the three months ended September 30, 2020, compared to the prior-year period.

Other operating expenses decreased $22.9 million, or 31%, in the nine months ended September 30, 2020, compared to the same prior-year period.

Other SG&A expenses decreased $8.0 million, or 32%, in the nine months ended September 30, 2020, compared to the prior-year period.

The decreases in Other operating expenses were primarily driven by the impact of the Sports Disposition and lower expenses related to our Sports Marketing operating segment prior to the disposition, lower costs related to third-party digital equipment sales and lower billboard and transit revenues.

The decreases in Other SG&A expenses were primarily driven by the impact of the Sports Disposition and cost reduction measures taken in response to the COVID-19 pandemic.

Other incurred Adjusted OIBDA of $3.2 million in the three months ended September 30, 2020, compared to $4.3 million in the same prior-year period and incurred an Adjusted OIBDA loss of $1.7 million in the nine months ended September 30, 2020, compared to Adjusted OIBDA of $14.3 million in the same prior-year period.

The decreases were due primarily to the Sports Disposition, a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise, the impact of the Sports Disposition, as well as the cancellation of spring sports at colleges and universities, partially offset by cost reduction measures taken in response to the COVID-19 pandemic.

Corporate expenses primarily include expenses associated with employees who provide centralized services.

Corporate expenses, excluding stock-based compensation, were $10.3 million in the three months ended June 30, 2020, compared to $11.0 million in the same prior-year period, primarily due to lower compensation-related expenses, partially offset by the impact of market fluctuations on an equity-linked retirement plan offered by the Company to certain employees, and lower costs resulting from cost reduction measures taken in response to the COVID-19 pandemic.

Corporate expenses, excluding stock-based compensation, were $14.8 million in the six months ended June 30, 2020, compared to $20.0 million in the same prior-year period, primarily due to lower compensation-related expenses, primarily related to the impact of market fluctuations on an equity-linked retirement plan offered by the Company to certain employees and resulting from cost reduction measures taken in response to the COVID-19 pandemic.

Corporate expenses, excluding stock-based compensation, were $8.9 million in the three months ended September 30, 2020, compared to $11.3 million in the same prior-year period.

Corporate expenses, excluding stock-based compensation, were $23.7 million in the nine months ended September 30, 2020, compared to $31.3 million in the same prior-year period.

The decreases were primarily due to lower compensation-related expenses, including lower costs resulting from cost reduction measures taken in response to the COVID-19 pandemic and the impact of market fluctuations on an equity-linked retirement plan offered by the Company to certain employees.

Liquidity and Capital Resources

(in millions, except percentages) June 30,

(in millions, except percentages) September 30,

2020 December 31, 2019 % Change

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Due to seasonal advertising patterns and influences on advertising markets, our revenues and operating income are typically highest in the fourth quarter, during the holiday shopping season, and lowest in the first quarter, as advertisers adjust their spending following the holiday shopping season.

Further, certain of our municipal transit contracts, as well as our marketing and multimedia rights agreements with colleges and universities, require guaranteed minimum annual payments to be paid on a monthly or quarterly basis, as applicable.

Further, certain of our municipal transit contracts require guaranteed minimum annual payments to be paid on a monthly or quarterly basis, as applicable.

Our short-term cash requirements primarily include payments for operating leases, guaranteed minimum annual payments, interest, capital expenditures, equipment deployment costs and dividends.

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Consistent with this strategy, we regularly evaluate potential acquisitions, ranging from small transactions to larger acquisitions, which transactions could be funded through cash on hand, additional borrowings, equity or other securities, or some combination thereof.

In response to the COVID-19 pandemic, we paused new acquisition activity.

In response to the COVID-19 pandemic, we have taken a highly selective approach to new acquisition activity.

Our long-term cash needs include principal payments on outstanding indebtedness and commitments related to operating leases and franchise and other agreements, including any related guaranteed minimum annual payments, and equipment deployment costs.

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We expect our short-term and long-term cash needs and related funding capability to be adversely affected by the impact of the COVID-19 pandemic as cash on hand and operating cash flows decrease in 2020, and our ability to issue debt and equity securities and/borrow under our existing or new credit facilities on reasonable pricing terms, or at all, may become uncertain.

In order to preserve financial flexibility and increase liquidity in light of the current uncertainty in the global economy and our business resulting from the COVID-19 pandemic, we borrowed $470.0 million under the Revolving Credit Facility, which was repaid in full as of June 30, 2020, using the net proceeds from the offering of the Notes and cash on hand, raised $400.0 million in the Private Placement, before expenses, issued $400.0 million aggregate principal amount of the Notes and amended the Credit Agreement to modify the calculation of the Company’s financial maintenance covenant ratio under the Credit Agreement, among other things.

In order to preserve financial flexibility and increase liquidity in light of the current uncertainty in the global economy and our business resulting from the COVID-19 pandemic, we repaid in full all borrowings under the Revolving Credit Facility as of June 30, 2020, using the net proceeds from the offering of the Notes and cash on hand, raised $400.0 million in the Private Placement (as defined below), before expenses, issued $400.0 million aggregate principal amount of the Notes and amended the Credit Agreement to modify the calculation of the Company’s financial maintenance covenant ratio under the Credit Agreement, among other things.

(See the “Overview—COVID-19 Impact” section of this MD&A.)

The increase in working capital as of June 30, 2020, compared to a working capital deficit as of December 31, 2019, is primarily driven by the increase in cash as a result of the Private Placement.

The increase in working capital as of September 30, 2020, compared to a working capital deficit as of December 31, 2019, is primarily driven by the increase in cash as a result of the Private Placement.

The increase in cash is partially offset by a decline in Prepaid MTA deployment costs .

As a result of the impact of the COVID-19 pandemic on our business and our expectations with respect to future revenues under the MTA agreement into the future, we reclassified the majority of Prepaid MTA deployment costs to long-term assets.

As a result of the impact of the COVID-19 pandemic on our business and our expectations with respect to future revenues under the MTA agreement into the future, we reclassified Prepaid MTA deployment costs to long-term assets.

Under the MTA agreement, we are obligated to deploy, over a number of years, (i) 8,565 digital advertising screens on subway and train platforms and entrances, (ii) 37,716 smaller-format digital advertising screens on rolling stock, and (iii) 7,829 MTA communications displays, with such deployment amounts being subject to modification as agreed-upon by us and the MTA.

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If incremental revenues generated over the term of the agreement are not sufficient to cover all or a portion of the equipment deployment costs, the costs will not be recouped, which could have an adverse effect on our business, financial condition and results of operation.

We did not recoup any equipment deployment costs in the six months ended June 30, 2020, and it’s unlikely we will recoup equipment deployment costs in 2020.

We did not recoup any equipment deployment costs in the nine months ended September 30, 2020, and it’s unlikely we will recoup equipment deployment costs in 2020.

In June 2020, we entered into an amendment to the MTA agreement, pursuant to which (i) for up to $143.0 million of MTA equipment deployment costs to be incurred under the MTA agreement after June 2020, the MTA and the Company will directly pay 70% and 30% of the costs, respectively, instead of the costs being recoupable from incremental revenues generated under the agreement, and (ii) any guaranteed minimum annual payment amounts that would have been paid for the period from April 1, 2020 through December 31, 2020 (less any revenue share amounts actually paid during this period using an increased revenue share percentage of 65%) will instead be added in equal increments to the guaranteed minimum annual payment amounts owed for the period from January 1, 2022, through December 31, 2026.

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Accordingly, for the full year of 2020, we currently expect our MTA equipment deployment costs to be significantly lower than our previously disclosed amount of approximately $175.0 million as we recommence deployment in 2020.

We may utilize cash on hand and/or incremental third-party financing to fund equipment

deployment costs over the next couple of years.

We may utilize cash on hand and/or incremental third-party financing to fund equipment deployment costs over the next couple of years.

However, given the uncertainty in the market around the severity and duration of the COVID-19 pandemic, we cannot reasonably estimate the aggregate financing amount, if any, at this time.

As of June 30, 2020, we have issued surety bonds (in place of letters of credit) in favor of the MTA totaling approximately $136.0 million, which amount is subject to change as equipment installations are completed and revenues are generated.

As of September 30, 2020, we have issued surety bonds (in place of letters of credit) in favor of the MTA totaling approximately $136.0 million, which amount is subject to change as equipment installations are completed and revenues are generated.

In addition, in the first quarter of 2020, we identified the COVID-19 pandemic as a trigger for impairment review of our Prepaid MTA equipment deployment costs and related intangible assets, and after performing an analysis, no impairment was identified.

In the second quarter of 2020, we updated our projections in connection with the amendment to the MTA agreement and did not identify a triggering event for an impairment review of our Prepaid MTA equipment deployment costs.

(See the “Critical Accounting Polices—MTA Agreement” section of this MD&A.) Further, we expect transit franchise expenses to materially increase as a percentage of revenues as revenues decline in 2020 as a result of the impact of the COVID-19 pandemic.

(See the “Overview—COVID-19 Impact” section of this MD&A.) As indicated in the table below, we incurred $34.3 million related to MTA equipment deployment costs in the six months ended June 30, 2020 (which includes equipment deployment costs related to future deployments), for a total of $281.9 million to date, of which $33.9 million had been recouped from incremental revenues to date.

As of June 30, 2020, 5,350 digital displays had been installed, of which 97 installations occurred in the three months ended June 30, 2020, for a total of 773 installations in the six months ended June 30, 2020.

In the second and third quarters of 2020, we updated our projections in connection with the amendment to the MTA agreement and did not identify a triggering event for an impairment review of our Prepaid MTA equipment deployment costs.

(See the “Critical Accounting Polices—MTA Agreement” section of this MD&A.) Further, we expect transit franchise expenses to materially increase as a percentage of revenues more than historical levels, as revenues decline in 2020 as a result of the impact of the COVID-19 pandemic.

(See the “Overview—COVID-19 Impact” section of this MD&A.) As indicated in the table below, we incurred $66.7 million related to MTA equipment deployment costs in the nine months ended September 30, 2020 (which includes equipment deployment costs related to future deployments), for a total of $314.3 million to date, of which $33.9 million had been recouped from incremental revenues to date and as of September 30, 2020, $21.7 million is to be funded by the MTA.

As of September 30, 2020, 6,177 digital displays had been installed, of which 827 installations occurred in the three months ended September 30, 2020, for a total of 1,600 installations in the nine months ended September 30, 2020.

(in millions) Beginning Balance Deployment Costs Incurred Recoupment Amortization Ending Balance

Six months ended June 30, 2020:

Nine months ended September 30, 2020:

Prepaid MTA equipment deployment costs $ 171.5 $ 29.4 $ — $ — $ 200.9

$ 171.5 $ 28.3 $ — $ — $ 199.8

Other current assets — 21.7 — — 21.7

Intangible assets (franchise agreements) 38.3 15.6 — (4.1) 49.8

38.3 6.0 — (2.7) 41.6

Total $ 209.8 $ 66.7 $ — $ (4.1) $ 272.4

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Prepaid MTA equipment deployment costs $ 79.5 $ 124.2 $ (32.2) $ — $ 171.5

$ 79.5 $ 124.2 $ (32.2) $ — $ 171.5

Intangible assets (franchise agreements) 14.8 26.6 — (3.1) 38.3

14.8 26.6 — (3.1) 38.3

Total $ 94.3 $ 150.8 $ (32.2) $ (3.1) $ 209.8

As of June 30, 2020, we had total indebtedness of approximately $2.7 billion, which excluding debt issuance costs of $30.8 million and net unamortized discount and premium of $0.8 million, resulted in Total debt, net, of approximately $2.7 billion.

As of September 30, 2020, we had total indebtedness of approximately $2.7 billion, which excluding debt issuance costs of $29.5 million and net unamortized discount and premium of $0.9 million, resulted in Total debt, net, of approximately $2.7 billion.

Debt, net, consists of the following:

(in millions, except percentages) June 30,

(in millions, except percentages) September 30,

2020 December 31,

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Total $ 3,498.8 $ 124.4 $ 246.0 $ 719.5 $ 2,408.9

The interest rate on the term loan due in 2026 (the “Term Loan”) was 1.9% per annum as of June 30, 2020.

As of June 30, 2020, a discount of $2.3 million on the Term Loan remains unamortized.

The interest rate on the term loan due in 2026 (the “Term Loan”) was 1.9% per annum as of September 30, 2020.

As of September 30, 2020, a discount of $2.3 million on the Term Loan remains unamortized.

The discount is being amortized through Interest expense, net , on the Consolidated Statement of Operations.

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We also have a $500.0 million revolving credit facility, which matures in 2024 (the “Revolving Credit Facility,” together with the Term Loan, the “Senior Credit Facilities”).

As of June 30, 2020, there were no outstanding borrowings under the Revolving Credit Facility.

The commitment fee based on the amount of unused commitments under the Revolving Credit Facility was $0.3 million in the three months ended June 30, 2020, $0.3 million in the three months ended June 30, 2019, $0.6 million in the six months ended June 30, 2020, and $0.7 million in the six months ended June 30, 2019.

As of June 30, 2020, we had issued letters of credit totaling approximately $1.6 million against the letter of credit facility sublimit under the Revolving Credit Facility.

As of September 30, 2020, there were no outstanding borrowings under the Revolving Credit Facility.

The commitment fee based on the amount of unused commitments under the Revolving Credit Facility was $0.6 million in the three months ended September 30, 2020, $0.4 million in the three months ended September 30, 2019, $1.2 million in the nine months ended September 30, 2020, and $1.1 million in the nine months ended September 30, 2019.

As of September 30, 2020, we had issued letters of credit totaling approximately $1.6 million against the letter of credit facility sublimit under the Revolving Credit Facility.

Standalone Letter of Credit Facilities

As of June 30, 2020, we had issued letters of credit totaling approximately $71.0 million under our aggregate $78.0 million standalone letter of credit facilities.

The total fees under the letter of credit facilities were immaterial in each of the three and six months ended June 30, 2020 and 2019.

As of September 30, 2020, we had issued letters of credit totaling approximately $72.0 million under our aggregate $78.0 million standalone letter of credit facilities.

The total fees under the letter of credit facilities were immaterial in each of the three and nine months ended September 30, 2020 and 2019.

Accounts Receivable Securitization Facilities

As of June 30, 2020, we have a revolving accounts receivable securitization facility (the “AR Facility”), which terminates in June 2022, unless further extended, and a 364-day uncommitted structured repurchase facility (the “Repurchase Facility” and together with the AR Facility, the “AR Securitization Facilities”), which now terminates in June 2021, as described below, unless further extended.

As of September 30, 2020, we have a revolving accounts receivable securitization facility (the “AR Facility”), which terminates in June 2022, unless further extended, and a 364-day uncommitted structured repurchase facility (the “Repurchase Facility” and together with the AR Facility, the “AR Securitization Facilities”), which terminates in June 2021, as described below, unless further extended.

On June 18, 2020, the Company, certain subsidiaries of the Company and MUFG Bank, Ltd.

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In connection with the Repurchase Facility, the Originators may borrow funds collateralized by subordinated notes (the “Subordinated Notes”) issued by the SPVs in favor of their respective Originators and representing a portion of the outstanding balance of the accounts receivable assets sold by the Originators to the SPVs under the AR Facility.

The Subordinated Notes will be transferred to MUFG, as repurchase buyer, on an uncommitted basis, and subject to repurchase by the applicable Originators on termination of the Repurchase Facility.

The Subordinated Notes

will be transferred to MUFG, as repurchase buyer, on an uncommitted basis, and subject to repurchase by the applicable Originators on termination of the Repurchase Facility.

The Originators have granted MUFG a security interest in the Subordinated Notes to secure their obligations under the agreements governing the Repurchase Facility, and the Company has agreed to guarantee the Originators’ obligations under the agreements governing the Repurchase Facility.

As of June 30, 2020, there were no outstanding borrowings under the AR Facility and $80.0 million of outstanding borrowings under the Repurchase Facility, at a borrowing rate of approximately 1.9%.

As of June 30, 2020, there was no borrowing capacity remaining under the AR Facility based on approximately $237.9 million of accounts receivable used as collateral for the AR Securitization Facilities and a related voluntary temporary suspension of the AR Facility, and there was no borrowing capacity remaining under the Repurchase Facility, in accordance with the agreements governing the AR Securitization Facilities.

The commitment fee based on the amount of unused commitments under the AR Facility was immaterial for each of the three and six months ended June 30, 2020 and 2019.

As of September 30, 2020, there were no outstanding borrowings under the AR Facility and $80.0 million of outstanding borrowings under the Repurchase Facility, at a borrowing rate of approximately 1.9%.

As of September 30, 2020, there was no borrowing capacity remaining under the AR Facility based on approximately $231.9 million of accounts receivable used as collateral for the AR Securitization Facilities and a related voluntary temporary suspension of the AR Facility, and there was no borrowing capacity remaining under the Repurchase Facility, in accordance with the agreements governing the AR Securitization Facilities.

The commitment fee based on the amount of unused commitments under the AR Facility was immaterial for each of the three and nine months ended September 30, 2020 and 2019.

Senior Unsecured Notes

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Interest on the Notes is payable on June 15 and December 15 of each year, beginning on December 15, 2020.

On or after June 15, 2022, the Borrowers may redeem at any

time, or from time to time, some or all of the Notes.

On or after June 15, 2022, the Borrowers may redeem at any time, or from time to time, some or all of the Notes.

Prior to such date, the Borrowers may redeem up to 40% of the aggregate principal amount of the aggregate principal amount with the net proceeds of certain equity offerings, provided that at least 50% of the aggregate principal amount of the Notes remain outstanding after the redemption.

In May 2020, we used the net proceeds from the Notes, together with cash on hand, to repay $400.0 million of outstanding borrowings under our Revolving Credit Facility and to pay fees and expenses in connection with the offering of the Notes.

As of June 30, 2020, a premium of $1.5 million on $100.0 million aggregate principal amount of the 5.625% Senior Unsecured Notes due 2024, remains unamortized.

As of September 30, 2020, a premium of $1.4 million on $100.0 million aggregate principal amount of the 5.625% Senior Unsecured Notes due 2024, remains unamortized.

The premium is being amortized through Interest expense, net , on the Consolidated Statement of Operations.

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One of the exceptions to the restriction on our ability to incur additional indebtedness is satisfaction of a Consolidated Total Leverage Ratio, which is the ratio of our consolidated total debt to our Consolidated EBITDA (as defined in the Credit Agreement) for the trailing four consecutive quarters, of no greater than 6.0 to 1.0.

As of June 30, 2020, our Consolidated Total Leverage Ratio was 6.7 to 1.0 in accordance with the Credit Agreement.

As of September 30, 2020, our Consolidated Total Leverage Ratio was 8.2 to 1.0 in accordance with the Credit Agreement.

The terms of the Credit Agreement (and under certain circumstances, the agreements governing the AR Securitization Facilities) require that we maintain a Consolidated Net Secured Leverage Ratio, which is the ratio of (i) our consolidated secured debt (less up to $150.0 million of unrestricted cash) to (ii) our Consolidated EBITDA (as defined in the Credit Agreement) for the trailing four consecutive quarters, of no greater than 4.5 to 1.0.

As of June 30, 2020, our Consolidated Net Secured Leverage Ratio was 1.0 to 1.0 in accordance with the Credit Agreement.

As of June 30, 2020, we are in compliance with our debt covenants.

As of September 30, 2020, our Consolidated Net Secured Leverage Ratio was 1.0 to 1.0 in accordance with the Credit Agreement.

As of September 30, 2020, we are in compliance with our debt covenants.

On April 15, 2020, the Company, along with the Borrowers, and other guarantor subsidiaries party thereto, entered into an amendment (the “Amendment”) to the Credit Agreement.

The Amendment provides that for the period from April 15, 2020 through September 30, 2021 (i) the Company’s Consolidated Net Secured Leverage Ratio shall be calculated by substituting the Company’s Consolidated EBITDA for each of the quarterly periods ended June 30, 2020 and September 30, 2020, included in any last twelve month compliance testing period, with the Company’s historical Consolidated EBITDA for each of the quarterly periods ended June 30, 2019 and September 30, 2019, respectively;

periods ended June 30, 2019 and September 30, 2019, respectively;

and (ii) the Company will not make any Restricted Payments (as defined in the Credit Agreement) without the consent of the applicable lenders under the Credit Agreement, subject to certain exceptions such as payments necessary to maintain the Company’s REIT status, including any payments on any class of the Company’s capital stock that is required to be made prior to the payment of a dividend or distribution on the Company’s common stock and the Company’s existing payment obligations to holders of the Class A equity interests in Outfront Canada (as defined in Note 10.

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Deferred Financing Costs

As of June 30, 2020, we had deferred $36.1 million in fees and expenses associated with the Term Loan, Revolving Credit Facility, AR Securitization Facilities and our senior unsecured notes.

As of September 30, 2020, we had deferred $34.4 million in fees and expenses associated with the Term Loan, Revolving Credit Facility, AR Securitization Facilities and our senior unsecured notes.

We are amortizing the deferred fees through Interest expense, net, on our Consolidated Statement of Operations over the respective terms of the Term Loan, Revolving Credit Facility, AR Securitization Facilities and our senior unsecured notes.

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We have several interest rate cash flow swap agreements to effectively convert a portion of our LIBOR-based variable rate debt to a fixed rate and hedge our interest rate risk related to such variable rate debt.

The fair value of these swap positions was a net liability of approximately $8.3 million as of June 30, 2020, and $4.6 million as of December 31, 2019, and is included in Other liabilities on our Consolidated Statement of Financial Position.

As of June 30, 2020, under the terms of the agreements, we will pay interest based on an aggregate notional amount of $200.0 million, under a weighted-average fixed interest rate of 2.7%, with a receive rate of one-month LIBOR and which mature at various dates until June 30, 2022.

The one-month LIBOR rate was approximately 0.2% as of June 30, 2020.

The fair value of these swap positions was a net liability of approximately $6.9 million as of September 30, 2020, and $4.6 million as of December 31, 2019, and is included in Other liabilities on our Consolidated Statement of Financial Position.

As of September 30, 2020, under the terms of the agreements, we will pay interest based on an aggregate notional amount of $200.0 million, under a weighted-average fixed interest rate of 2.7%, with a receive rate of one-month LIBOR and which mature at various dates until June 30, 2022.

The one-month LIBOR rate was approximately 0.1% as of September 30, 2020.

At-the-Market Equity Offering Program

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We have no obligation to sell any of our common stock under the sales agreement and may at any time suspend solicitations and offers under the sales agreement.

No shares were sold under the ATM Program during the three and six months ended June 30, 2020.

As of June 30, 2020, we had approximately $232.5 million of capacity remaining under the ATM Program.

No shares were sold under the ATM Program during the three and nine months ended September 30, 2020.

As of September 30, 2020, we had approximately $232.5 million of capacity remaining under the ATM Program.

Series A Preferred Stock Issuance

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So long as any shares of Series A Preferred Stock remain outstanding, the Company may not declare a dividend on, or make any distributions relating to, capital stock that ranks junior to, or on a parity basis with, the Series A Preferred Stock, subject to certain exceptions, including but not limited to (i) any dividend or distribution in cash or capital stock of the Company on or in respect of the capital stock of the Company to the extent that such dividend or distribution is necessary to maintain the Company’s status as a REIT;

and (ii) any dividend or distribution in cash in respect of our common stock that, together with the dividends or distributions during the 12-month period immediately preceding such dividend or distribution, is not in excess of 5% of the aggregate dividends or distributions paid by the Company necessary to maintain its REIT status during such 12-month period.

month period.

Following the one-year anniversary of the Closing Date, if all or any portion of the dividends or distributions is paid in respect of the shares of our common stock in cash, the shares of Series A Preferred Stock will participate in such dividends or distributions on an as-converted basis up to the amount of their accrued dividend on the Series A Preferred Stock for such quarter, which amounts will reduce the dividends payable on the shares of Series A Preferred Stock dollar-for-dollar for such quarter.

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Subject to certain conditions, at the Company’s option, (i) after the third anniversary of the Closing Date, all of the Series A Preferred Stock may be converted into shares of our common stock, and (ii) after the seventh anniversary of the Closing Date, all of the Series A Preferred Stock may be redeemed for cash at a redemption price equal to 100% of the liquidation preference of the Series A Preferred Stock, plus any accrued and unpaid dividends.

Subject to certain conditions, each holder of the Series A Preferred Stock, after a Change of Control (as defined in the Articles) may (i) require the Company to purchase any or all of their shares of Series A Preferred Stock at a redemption price payable in cash equal to 105% of the liquidation preference of the Series A Preferred Stock, plus any accrued and unpaid dividends, or (ii) convert any or all of their shares of Series A Preferred

Stock into the number of shares of our common stock equal to the liquidation preference (including accrued and unpaid dividends) divided by the then-applicable conversion price.

During the three months ended June 30, 2020, we paid cash dividends of $5.5 million on the Series A Preferred Stock.

As of June 30, 2020, the maximum number of shares of common stock that could be required to be issued on conversion of the outstanding shares of Series A Preferred Stock was 25.0 million shares.

The following table presents our cash flows in the six months ended June 30, 2020 and 2019.

Six Months Ended

During the three months ended September 30, 2020, we paid cash dividends of $7.0 million on the Series A Preferred Stock.

As of September 30, 2020, the maximum number of shares of common stock that could be required to be issued on conversion of the outstanding shares of Series A Preferred Stock was 25.0 million shares.

The following table presents our cash flows in the nine months ended September 30, 2020 and 2019.

Nine Months Ended

September 30, %

(in millions, except percentages) 2020 2019 Change

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Cash used for investing activities (35.1) (138.1) (75)

Cash provided by financing activities 588.3 420.7 40

Cash provided by (used for) financing activities 581.0 (14.7) *

Effect of exchange rate changes on cash, cash equivalents and restricted cash

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* Calculation is not meaningful.

Cash provided by operating activities decreased $32.8 million, or 39%, in the six months ended June 30, 2020, compared to the same prior-year period, driven by the impact of the COVID-19 pandemic, partially offset by the impact of cost reduction measures taken in response to the COVID-19 pandemic.

In the six months ended June 30, 2020, we paid $28.3 million related to MTA equipment deployment costs and installed 773 digital displays.

In the six months ended June 30, 2019, we paid $58.6 million related to MTA equipment deployment costs.

Cash used for investing activities decreased $33.2 million, or 40%, in the six months ended June 30, 2020, compared to the same prior-year period, due primarily to lower cash paid for acquisitions, capital expenditures and MTA franchise rights.

The following table presents our capital expenditures in the six months ended June 30, 2020 and 2019.

Six Months Ended

Cash provided by operating activities decreased $76.1 million, or 47%, in the nine months ended September 30, 2020, compared to the same prior-year period, driven by the impact of the COVID-19 pandemic, partially offset by the impact of cost reduction measures taken in response to the COVID-19 pandemic.

In the nine months ended September 30, 2020, we paid $51.1 million related to MTA equipment deployment costs and installed 1,600 digital displays.

In the nine months ended September 30, 2019, we paid $83.3 million related to MTA equipment deployment costs.

Cash used for investing activities decreased $103.0 million, or 75%, in the nine months ended September 30, 2020, compared to the same prior-year period, due primarily to higher proceeds from dispositions, including proceeds from the Sports Disposition, lower cash paid for acquisitions, capital expenditures and MTA franchise rights.

The following table presents our capital expenditures in the nine months ended September 30, 2020 and 2019.

Nine Months Ended

September 30, %

(in millions, except percentages) 2020 2019 Change

Growth $ 28.0 $ 50.4 (44) %

14.0 15.0 (7)

Total capital expenditures $ 42.0 $ 65.4 (36)

Capital expenditures decreased $7.7 million, or 19%, in the six months ended June 30, 2020, compared to the same prior-year period, due to lower spending on installation of the most current LED lighting technology and lower spending on digital billboard and transit display projects.

Capital expenditures decreased $23.4 million, or 36%, in the nine months ended September 30, 2020, compared to the same prior-year period, primarily due to lower spending on digital billboard and transit display projects and lower spending on installation of the most current LED lighting technology.

In response to the impact of the COVID-19 pandemic, we reduced maintenance capital expenditures (other than for necessary safety-related projects) and growth capital expenditures for digital billboard display conversions.

For the full year of 2020, we expect our capital expenditures to be approximately $50.0 million, which will be used primarily for necessary safety-related maintenance projects and growth in digital displays for which screens have already been ordered or received.

Cash provided by financing activities increased $167.6 million, or 40%, in the six months ended June 30, 2020, compared to the same prior-year period.

In the six months ended June 30, 2020, we received net proceeds of $400.0 million related to the Notes offering and received net proceeds of $383.9 million related to the issuance of the Series A Preferred Stock to enhance our liquidity position in response to the COVID-19 pandemic and made net repayments under the AR Securitization Facilities of $115.0 million and paid total cash dividends on the Series A Preferred Stock and on our common stock of $61.1 million.

In the six months ended June 30, 2019, we received net proceeds of $650.0 million related to our 2027 senior unsecured notes offering, received net proceeds of $50.9 million related to the sale of our common stock under the ATM Program, made net

repayments of $160.0 million on the AR Securitization Facilities and paid cash dividends on our common stock of $103.9 million.

Cash paid for income taxes was $2.1 million for in the six months ended June 30, 2020 and $5.3 million in the six months ended June 30, 2019.

For the full year of 2020, we expect our capital expenditures to be approximately $55.0 million, which will be used primarily for necessary safety-related maintenance projects and growth in digital displays.

Cash provided by financing activities was $581.0 million in the nine months ended September 30, 2020, compared to Cash used by financing activities of $14.7 million in the same prior-year period.

In the nine months ended September 30, 2020, we received net proceeds of $400.0 million related to the Notes offering and received net proceeds of $383.8 million related to the issuance of the Series A Preferred Stock to enhance our liquidity position in response to the COVID-19 pandemic and made net repayments under the AR Securitization Facilities of $115.0 million and paid total cash dividends on the Series A Preferred Stock and on our common stock of $68.1 million.

In the nine months ended September 30, 2019, we paid cash dividends on our common stock of $156.0 million and made a discretionary payment of $50.0 million on the Term Loan.

In addition, we received net proceeds of $100.0 million related to our 2027 senior unsecured notes offering and repayment of our 2022 senior unsecured notes, received net proceeds of $50.9 million related to the sale of our common stock under the ATM Program, drew net borrowings of $50.0 million on the AR Securitization Facilities and drew $15.0 million on the Revolving Credit Facility.

Cash paid for income taxes was $3.1 million for in the nine months ended September 30, 2020 and $7.9 million in the nine months ended September 30, 2019.

Off-Balance Sheet Arrangements

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After updating our projections to reflect related declines in revenues in 2020 and delays in our anticipated deployment schedule as a result of the impact of the COVID-19 pandemic, among other things, no impairment was identified.

In the second quarter of 2020, we updated our projections in

connection with the amendment to the MTA agreement and did not identify a triggering event for an impairment review of our P repaid MTA equipment deployment costs .

The assumptions and estimates included in our analysis require significant judgment about future events, market conditions and financial performance.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis