What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-11-03 compared with 2023-08-07 · 208 added, 192 removed, 581 unchanged (41% of the section changed)

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Economic Environment

Our revenues and operating results are sensitive to fluctuations in advertising expenditures, general economic conditions and other external events beyond our control, such as supply chain disruptions, heightened levels of inflation, pandemics like the COVID-19 pandemic, industry shutdowns like the current entertainment strikes, and shifts in market demographics and transportation patterns (including reductions in foot traffic, roadway traffic, commuting, transit ridership and overall target audiences due to remote work, safety concerns or otherwise), as described in this MD&A.

Our revenues and operating results are sensitive to fluctuations in advertising expenditures, general economic conditions and other external events beyond our control, such as supply chain disruptions, heightened levels of inflation, pandemics like the COVID-19 pandemic, industry shutdowns or slowdowns like the current entertainment and auto workers strikes, and shifts in market demographics and transportation patterns (including reductions in foot traffic, roadway traffic, commuting, transit ridership and overall target audiences due to remote work, safety concerns or otherwise), as described in this MD&A.

These sensitivities may adversely impact our revenues and operating results on a consolidated basis and/or may have a disproportionate adverse impact on one or more of our operating segments, especially our U.S.

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We rely on third parties to manufacture and transport our digital displays.

As a result of the current market-wide supply shortages and logistics disruptions, we have experienced delays and price increases with respect to certain of our digital displays, which we expect to continue in 2023, and could have an adverse effect on our business, financial condition and results of operations.

As a result of the current market-wide supply shortages and logistics disruptions, we have experienced delays and price increases with respect to certain of our digital displays, which we expect to continue throughout 2023, and could have an adverse effect on our business, financial condition and results of operations.

Due to the current heightened levels of inflation and commodity prices in the U.S.

and abroad, which has resulted in rising interest rates, we have experienced increases with respect to our posting, maintenance and other expenses, our corporate expenses and our interest expense, which we expect to continue in 2023, and could have an adverse effect on our business, financial condition and results of operations.

and abroad, which has resulted in rising interest rates, we have experienced increases with respect to some of our posting, maintenance and other expenses, some of our corporate expenses, and our interest expense, which we expect to continue throughout 2023, and could have an adverse effect on our business, financial condition and results of operations.

Our billboard property lease expenses and transit franchise expenses have been less impacted by the current heightened levels of inflation due to the long-term nature of most of our operating leases and transit franchise agreements.

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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.

However, we expect our annual deployment cost spending with respect to our transit franchise agreement with the New York Metropolitan Transportation Authority (the “MTA”) will decline beginning in 2024 as we near the end of our initial deployment phase.

However, we expect our annual deployment cost spending with respect to our transit franchise agreement with the New York Metropolitan Transportation Authority (the “MTA”) will decline after we complete our initial deployment phase in 2024.

We built or converted 64 new digital billboard displays in the U.S.

and 20 in Canada during the six months ended June 30, 2023.

Additionally, in the six months ended June 30, 2023, we entered into marketing arrangements to sell advertising on 25 third-party digital billboard displays in the U.S.

In the six months ended June 30, 2023, we built, converted or replaced 2,662

digital transit and other displays in the U.S.

and 33 in Canada during the nine months ended September 30, 2023.

Additionally, in the nine months ended September 30, 2023, we entered into marketing arrangements to sell advertising on 32 third-party digital billboard displays in the U.S.

and 2 in Canada.

In the nine months ended September 30, 2023, we built, converted or replaced 4,706 digital transit and other displays in the U.S.

and 23 in Canada.

The following table sets forth information regarding our digital displays.

Digital Revenues (in millions)

for the Six Months Ended

June 30, 2023 (a)

for the Nine Months Ended

September 30, 2023 (a)

Number of Digital Displays as of

June 30, 2023 (a)

September 30, 2023 (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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We have a diversified base of customers across various industries.

During the three months ended June 30, 2023, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 20%, 10% and 8% of our total U.S.

During the three months ended September 30, 2023, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 19%, 11% and 9% of our total U.S.

Media segment revenues, respectively.

During the three months ended June 30, 2022, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 20%, 11% and 9% of our total U.S.

During the three months ended September 30, 2022, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 19%, 10% and 9% of our total U.S.

Media segment revenues, respectively.

During the six months ended June 30, 2023, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 20%, 10% and 9% of our total U.S.

During the nine months ended September 30, 2023, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 20%, 10% and 9% of our total U.S.

Media segment revenues, respectively.

During the six months ended June 30, 2022, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 21%, 10% and 9% of our total U.S.

During the nine months ended September 30, 2022, our largest categories of advertisers were entertainment, retail and health/medical, each of which represented approximately 20%, 10% and 9% of our total U.S.

Media segment revenues, respectively.

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We generated approximately 42% of our U.S.

Media segment revenues from national advertising campaigns in each of the three months ended June 30, 2023 and 2022.

In the six months ended June 30, 2023, we generated approximately 41% of our U.S.

Media segment revenues from national advertising campaigns compared to approximately 42% in the same prior-year period.

Media segment revenues from national advertising campaigns in the three months ended September 30, 2023, compared to approximately 45% in the same prior-year period.

We generated approximately 42% of our U.S.

Media segment revenues from national advertising campaigns in the nine months ended September 30, 2023, compared to approximately 43% in the same prior-year period.

Our transit businesses require us to periodically obtain and renew contracts with municipalities and other governmental entities.

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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) 2023 2022 Change 2023 2022 Change

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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 Operating income before Depreciation , Amortization , Net gain (loss) on dispositions , Stock-based compensation and Impairment charges (“Adjusted OIBDA”) Net income (loss) 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 (loss) to Operating income (loss) before Depreciation , Amortization , Net gain (loss) on dispositions , Stock-based compensation and Impairment charges (“Adjusted OIBDA”) Net income (loss) attributable to OUTFRONT Media Inc.

to FFO attributable to OUTFRONT Media Inc.

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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) 2023 2022 Change 2023 2022 Change

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

Total revenues increased by $18.6 million, or 4%, and organic revenues increased $18.7 million, or 4%, in the three months ended June 30, 2023, compared to the same prior-year period.

Total revenues increased by $40.9 million, or 5%, and organic revenues increased $39.2 million, or 5%, in the six months ended June 30, 2023, compared to the same prior-year period.

In the three and six months ended June 30, 2023, non-organic revenues reflect the impact of a significant acquisition.

In the three and six months ended June 30, 2022, non-organic revenues reflect the impact of a significant acquisition and the impact of foreign currency exchange rates.

Total billboard revenues increased $17.6 million, or 5%, in the three months ended June 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield) and the impact of new and lost billboards in the period, including acquisitions.

Total billboard revenues increased $40.0 million, or 6%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), the impact of new and lost billboards in the period, including acquisitions, and higher proceeds from condemnations.

Organic billboard revenues increased $17.5 million, or 5%, in the three months ended June 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield) and the impact of new and lost billboards in the period, including insignificant acquisitions.

Organic billboard revenues increased $37.9 million, or 6%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), the impact of new and lost billboards in the period, including insignificant acquisitions, and higher proceeds from condemnations.

Total transit and other revenues increased $1.0 million, or 1%, in the three months ended June 30, 2023, compared to the same prior-year period, primarily due to the impact of a new transit franchise contract, partially offset by a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays.

Total transit and other revenues increased $0.9 million, or 1%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily due to the impact of a new transit franchise contract, partially offset by a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays.

Organic transit and other revenues increased $1.2 million, or 1%, in the three months ended June 30, 2023, compared to the same prior-year period, primarily driven by the impact of a new transit franchise contract, partially offset by a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays.

Organic transit and other revenues increased $1.3 million, or 1%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily driven by the impact of a new

transit franchise contract, partially offset by a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays.

Total revenues increased by $1.1 million and organic revenues increased $1.7 million in the three months ended September 30, 2023, compared to the same prior-year period.

Total revenues increased by $42.0 million, or 3%, and organic revenues increased $41.1 million, or 3%, in the nine months ended September 30, 2023, compared to the same prior-year period.

In the nine months ended September 30, 2023 and 2022, non-organic revenues reflect the impact of a significant acquisition.

In the three and nine months ended September 30, 2022, non-organic revenues reflect the impact of foreign currency exchange rates.

Total billboard revenues increased $8.6 million, or 2%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield) and the impact of new and lost billboards in the period, including acquisitions.

Total billboard revenues increased $48.6 million, or 5%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), the impact of new and lost billboards in the period, including acquisitions, and higher proceeds from condemnations.

Organic billboard revenues increased $9.1 million, or 3%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield) and the impact of new and lost billboards in the period, including acquisitions.

Organic billboard revenues increased $47.2 million, or 5%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), the impact of new and lost billboards in the period, including insignificant acquisitions, and higher proceeds from condemnations.

Total transit and other revenues decreased $7.5 million, or 8%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily due to a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays, partially offset by the impact of a new transit franchise contract.

Total transit and other revenues decreased $6.6 million, or 2%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily due to a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays, partially offset by the impact of a new transit franchise contract.

Organic transit and other revenues decreased $7.4 million, or 8%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily driven by a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays, partially offset by the impact of a new transit franchise contract.

Organic transit and other revenues decreased $6.1 million, or 2%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily driven by a decrease in

average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays, partially offset by the impact of a new transit franchise contract.

Transit ridership remains materially below pre-COVID-19 pandemic levels in our largest transit markets and while we expect ridership to gradually grow over time, we do not expect ridership to reach pre-COVID-19 pandemic levels during the remaining terms of our current transit agreements.

While ridership has increased during 2023 as compared to 2022, the increase in ridership has not led to an increase in overall demand for transit displays.

Three Months Ended Six Months Ended

June 30, % June 30, %

Three Months Ended Nine Months Ended

September 30, % September 30, %

(in millions, except percentages) 2023 2022 Change 2023 2022 Change

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Selling, general and administrative 105.3 106.5 (1) 321.8 311.8 3

Net (gain) loss on dispositions (0.1) 0.2 * 0.2 (0.1) *

Net loss on dispositions — 0.2 * 0.2 0.1 100

Impairment charges 12.1 — * 523.5 — *

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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) 2023 2022 Change 2023 2022 Change

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Total operating expenses $ 239.8 $ 232.6 3 $ 721.2 $ 671.9 7

Billboard property lease expenses represented 35% of billboard revenues in the three months ended June 30, 2023, 32% in the three months ended June 30, 2022, 36% of billboard revenues in the six months ended June 30, 2023, and 34% in the six months ended June 30, 2022.

The increase in billboard property lease expenses as a percentage of billboard revenues in the three months ended June 30, 2023, is primarily due to an increase in variable billboard property lease expenses (see Note 5.

Billboard property lease expenses represented 34% of billboard revenues in the three months ended September 30, 2023, 32% in the three months ended September 30, 2022, 35% of billboard revenues in the nine months ended September 30, 2023, and 33% in the nine months ended September 30, 2022.

The increase in billboard property lease expenses as a percentage of billboard revenues in the three months ended September 30, 2023, is primarily due to an increase in variable billboard property lease expenses (see Note 5.

Leases to the Consolidated Financial Statements), which are primarily attributable to billboard revenue increases in large markets and high profile locations, and the impact of new locations, including through acquisitions.

The increase in billboard property lease expenses as a percentage of billboard revenues in the six months ended June 30, 2023, is primarily due to an increase in variable billboard property lease expenses (see Note 5.

Leases to the Consolidated Financial Statements), which are primarily attributable to billboard revenue increases in large markets and high profile locations, an out-of-period adjustment of $5.2 million recorded in the six months ended June 30, 2023, related to variable billboard property lease expenses (see Note 1.

The increase in billboard property lease expenses as a percentage of billboard revenues in the nine months ended September 30, 2023, is primarily due to an increase in variable billboard property lease expenses (see Note 5.

Leases to the Consolidated Financial Statements), which are primarily attributable to billboard revenue increases in large markets and high profile locations, an out-of-period adjustment of $5.2 million recorded in the nine months ended September 30, 2023, related to variable billboard property lease expenses (see Note 1.

Description of Business and Basis of Presentation to the Consolidated Financial Statements), and the impact of new locations, including through acquisitions.

Transit franchise expenses represented 70% of transit display revenues in the three months ended June 30, 2023, 68% in the three months ended June 30, 2022, 78% of transit display revenues in the six months ended June 30, 2023, and 73% in the six months ended June 30, 2022.

The increases in transit franchise expense, as a percentage of transit display revenues in each of the three and six months ended June 30, 2023, are primarily driven by higher guaranteed minimum annual payments to the MTA in each of the three and six months ended June 30, 2023.

Transit franchise expenses represented 73% of transit display revenues in the three months ended September 30, 2023, 67% in the three months ended September 30, 2022, 76% of transit display revenues in the nine months ended September 30, 2023, and 71% in the nine months ended September 30, 2022.

The increases in transit franchise expense, as a percentage of transit display revenues in each of the three and nine months ended September 30, 2023, are primarily driven by higher guaranteed minimum annual payments to the MTA in each of the three and nine months ended September 30, 2023.

We expect transit franchise expenses, as a percentage of transit display revenues, to decline in the remainder of 2023, but remain above pre-COVID-19 pandemic levels and above 2022 levels, as a result of our expectation that revenues generated under the MTA Agreement in the remainder of 2023 will not grow at a compound annual growth rate above the inflation-adjusted guaranteed minimum annual payments to the MTA.

Billboard property lease and transit franchise expenses increased $17.4 million, or 10%, in the three months ended June 30, 2023, compared to the same prior-year period, primarily due to higher variable billboard property lease expenses, the impact of new locations, including through acquisitions, and higher guaranteed minimum annual payments to the MTA.

Billboard property lease and transit franchise expenses increased $37.2 million, or 11%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily due to higher variable billboard property lease expenses, including an out-of-period adjustment of $5.2 million recorded in the six months ended June 30, 2023, (see Note 1.

Billboard property lease and transit franchise expenses increased $9.5 million, or 5%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily due to higher variable billboard property lease expenses, the impact of new locations, including through acquisitions, and higher guaranteed minimum annual payments to the MTA, partially offset by a decline in non-MTA transit franchise costs.

Billboard property lease and transit franchise expenses increased $46.7 million, or 9%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily due to higher variable billboard property lease expenses, including an out-of-period adjustment of $5.2 million recorded in the nine months ended September 30, 2023, (see Note 1.

Description of Business and Basis of Presentation to the Consolidated Financial Statements), the impact of new locations, including through acquisitions, and higher guaranteed minimum annual payments to the MTA.

Posting, maintenance and other expenses as a percentage of Revenues were 12% in each of the three months ended June 30, 2023 and 2022, and 13% in each of the six months ended June 30, 2023 and 2022.

Posting, maintenance and other expenses increased $2.0 million, or 4%, in the three months ended June 30, 2023, compared to the same prior-year period, primarily due to higher taxes and compensation-related expenses.

Posting, maintenance and other expenses increased $4.9 million, or 5%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily due to higher taxes, higher maintenance and utilities cost, driven by inflation-driven cost increases in 2023, higher compensation-related expenses and increased activity resulting in higher materials cost, partially offset by lower posting and rotation costs.

Posting, maintenance and other expenses as a percentage of Revenues were 12% in the three months ended September 30, 2023, 13% in the three months ended September 30, 2022, and 13% in each of the nine months ended September 30, 2023 and 2022.

Posting, maintenance and other expenses decreased $2.3 million, or 4%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily due to lower taxes and lower posting and rotation costs, partially offset by higher maintenance and utilities cost, driven by inflationary cost increases in 2023.

Posting, maintenance and other expenses increased $2.6 million, or 2%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily due to higher maintenance and utilities cost, driven by inflationary cost increases in 2023, higher compensation-related expenses and increased activity resulting in higher materials cost, partially offset by lower posting and rotation costs.

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

SG&A expenses represented 23% of Revenues in the three months ended June 30, 2023, compared to 24% of Revenues in the same prior-year period, and 25% of Revenues in each of the six months ended June 30, 2023 and 2022.

SG&A expenses increased $1.7 million, or 2%, in the three months ended June 30, 2023, compared to the same prior-year period, primarily due to the impact of market fluctuations on an unfunded equity-linked retirement plan offered by the Company to certain employees, partially offset by lower compensation-related expenses and the impact of certain cost initiatives undertaken during the quarter.

SG&A expenses increased $11.2 million, or 5%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily due to the impact of market fluctuations on an unfunded equity-linked retirement plan offered by the Company to certain employees, higher compensation-related expenses, higher professional fees and higher travel and entertainment expenses.

We continue to evaluate methods to lower SG&A expense growth and believe that these expenses will represent a lower percentage of revenues in the remainder of 2023 when compared to the same prior-year period.

Net (Gain) Loss on Dispositions

Net gain on dispositions was $0.1 million in the three months ended June 30, 2023, compared to a Net loss on dispositions of $0.2 million the same prior-year period.

Net loss on dispositions was $0.2 million in the six months ended June 30, 2023, compared to a Net gain on dispositions of $0.1 million in the same prior-year period.

SG&A expenses represented 23% of Revenues in each of the three months ended September 30, 2023 and 2022, and 24% of Revenues in each of the nine months ended September 30, 2023 and 2022.

SG&A expenses decreased $1.2 million, or 1%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily due to lower compensation-related expenses, partially offset by a higher provision for doubtful accounts, higher professional fees, rent related to new offices and the impact of market fluctuations on an unfunded equity-linked retirement plan offered by the Company to certain employees.

SG&A expenses increased $10.0 million, or 3%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily due to the impact of market fluctuations on an unfunded equity-linked retirement plan offered by the Company to certain employees, higher professional fees, rent related to new offices and a higher provision for doubtful accounts, partially offset by lower compensation-related expenses.

We continue to evaluate methods to lower SG&A expense growth and believe that these expenses will represent a lower percentage of revenues in 2024.

Net Loss on Dispositions

Net loss on dispositions decreased $0.2 million in the three months ended September 30, 2023, compared to the same prior-year period.

Net loss on dispositions increased $0.1 million, or 100.0%, in the nine months ended September 30, 2023, compared to the same prior-year period.

Impairment Charges

In the three months ended June 30, 2023, we recorded impairment charges of $511.4 million.

In the nine months ended September 30, 2023, we recorded impairment charges of $523.5 million.

As a result of the impairment analysis performed during the second quarter of 2023, we determined that the carrying value of our U.S.

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(See the “Critical Accounting Policies” section of this MD&A.)

We also performed an analysis of carrying value of our long-lived asset groups within our U.S.

During the second quarter of 2023, we also performed an analysis of the carrying value of our long-lived asset groups within our U.S.

Transit and Other reporting unit as a result of the triggering event noted above utilizing undiscounted cash flows compared to the carrying value of the asset groups.

As a result, we recorded an impairment charge of $463.5 million in the second quarter of 2023, primarily representing a $443.1 million impairment charge related to our MTA asset group.

As a result of our continued expectation of negative aggregate cash flows related to our MTA asset group, we recorded an additional impairment charge of $12.1 million in the third quarter of 2023, representing additional MTA equipment deployment cost spending during the quarter.

Long-Lived Assets to the Consolidated Financial Statements.)

In addition, we recorded an impairment charge of $0.3 million related to an other-than-temporary decline in fair value of a cost-method investment.

Depreciation increased $0.3 million, or 2%, in the three months ended June 30, 2023, compared to the same prior-year period and increased $1.1 million, or 3%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily due to capital expenditures and acquisitions in 2022.

Amortization increased $4.2 million, or 24%, in the three months ended June 30, 2023, and increased $11.2 million, or 35%, in the six months ended June 30, 2023, compared to the same prior-year periods.

The increases were due primarily to higher amortization of leasehold interest intangibles recorded related to asset acquisitions.

In addition, in the second quarter of 2023, we recorded an impairment charge of $0.3 million related to an other-than-temporary decline in fair value of a cost-method investment.

Depreciation decreased $0.6 million, or 3%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily due to an increase in fully-depreciated assets, partially offset by capital expenditures and acquisitions.

Depreciation increased $0.5 million, or 1%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily due to capital expenditures and acquisitions in 2022, partially offset by an increase in fully-depreciated assets.

Amortization decreased $0.5 million, or 2%, in the three months ended September 30, 2023, due primarily to lower amortization of franchise rights.

Amortization increased $10.7 million, or 20%, in the nine months ended September 30, 2023, compared to the same prior-year periods, due primarily to higher amortization of leasehold interest intangibles recorded related to asset acquisitions.

Interest Expense, Net

Interest expense, net, was $39.7 million (including $1.8 million of deferred financing costs) in the three months ended June 30, 2023, and $31.6 million (including $1.7 million of deferred financing costs) in the same prior-year period.

Interest expense, net, was $77.4 million (including $3.4 million of deferred financing costs) in the six months ended June 30, 2023, and $62.3 million (including $3.3 million of deferred financing costs) in the same prior-year period.

Interest expense, net, was $40.2 million (including $1.6 million of deferred financing costs) in the three months ended September 30, 2023, and $33.6 million (including $1.6 million of deferred financing costs) in the same prior-year period.

Interest expense, net, was $117.6 million (including $5.0 million of deferred financing costs) in the nine months ended September 30, 2023, and $95.9 million (including $4.9 million of deferred financing costs) in the same prior-year period.

The increases were primarily due to higher interest rates and a higher average debt balance.

Benefit (Provision) for Income Taxes

Provision for income taxes decreased $0.8 million, or 67%, in the three months ended June 30, 2023, compared to the same prior-year period, due primarily to changes in taxable income for our U.S.

taxable REIT subsidiary (“TRS”).

Provision for income taxes was $0.8 million in the six months ended June 30, 2023, compared to a Benefit for income taxes of $0.9 million in the same prior-year period, due primarily to changes in taxable income for our U.S.

TRS and recording a valuation allowance against our U.S.

TRS’s deferred tax assets.

Net income before allocation to non-controlling interests decreased $526.8 million in the three months ended June 30, 2023, and decreased $555.6 million in the six months ended June 30, 2023, compared to the same prior-year periods, driven by lower operating income, due primarily to impairment charges and higher interest expense.

Provision for income taxes was $1.4 million in the three months ended September 30, 2023, compared to a Benefit for income taxes of $0.3 million in the same prior-year period, due primarily to a valuation allowance against our U.S.

taxable REIT subsidiary (“TRS”) deferred tax assets in 2023.

Provision for income taxes was $2.2 million in the nine months ended September 30, 2023, compared to a Benefit for income taxes of $1.2 million in the same prior-year period, due primarily to a valuation allowance against our U.S.

TRS deferred tax assets in 2023.

Net Income (Loss)

Net income before allocation to non-controlling interests decreased $24.4 million, or 59%, in the three months ended September 30, 2023, compared to the same prior-year period, driven by lower operating income, due primarily to impairment charges, and higher interest expense.

Net loss before allocation to non-controlling interests was $490.4 million in the nine months ended September 30, 2023, compared to Net income before allocation to non-controlling interests of $89.6 million the same prior-year period, driven by lower operating income, due primarily to impairment charges, and higher interest expense.

Reconciliation of Non-GAAP Financial Measures

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When used herein, references to “FFO” and “AFFO” mean “FFO attributable to OUTFRONT Media Inc.” and “AFFO attributable to OUTFRONT Media Inc.,” respectively.

We calculate FFO in accordance with the definition established by the National Association of Real Estate Investment Trusts (“NAREIT”).

We calculate FFO in accordance with the definition established by the

National Association of Real Estate Investment Trusts (“NAREIT”).

FFO reflects net income (loss) 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.

financing costs and the same adjustments for our non-controlling interests, along with the non-cash portion of income taxes, and the related income tax effect of adjustments, as applicable.

In addition, AFFO excludes certain non-cash items, including non-real estate depreciation and amortization, impairment charges on 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, along with 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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In addition, these measures do not necessarily represent funds available for discretionary use and are not necessarily a measure of our ability to fund our cash needs.

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

The following table reconciles Operating income (loss) 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 percentages) 2023 2022 2023 2022

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Operating income (loss) $ 58.6 $ 74.3 $ (369.4) $ 182.7

Net (gain) loss on dispositions (0.1) 0.2 0.2 (0.1)

Net loss on dispositions — 0.2 0.2 0.1

Impairment charges 12.1 — 523.5 —

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Amortization of direct lease acquisition costs 15.0 15.4 42.4 46.4

Net (gain) loss on disposition of real estate assets (0.1) 0.2 0.2 (0.1)

Net loss on disposition of real estate assets — 0.2 0.2 0.1

Impairment charges (a)

22 unchanged sentences

FFO attributable to OUTFRONT Media Inc.

in the three months ended June 30, 2023, was a deficit of $59.8 million compared to FFO attributable to OUTFRONT Media Inc.

of $92.4 million in the same prior-year period, due primarily to impairment charges on non-real estate assets and higher interest expense.

decreased $14.6 million, or 17%, in the three months ended September 30, 2023, compared to the same prior-year period, due primarily to higher interest expense, lower Adjusted OIBDA and impairment charges on non-real estate assets.

FFO attributable to OUTFRONT Media Inc.

in the six months ended June 30, 2023, was a deficit of $42.7 million compared to FFO attributable to OUTFRONT Media Inc.

of $134.2 million in the same prior-year period, due primarily to impairment charges on non-real estate assets, higher interest expense and lower Adjusted OIBDA.

decreased $191.5 million, or 86%, in the nine months ended September 30, 2023, compared to the same prior-year period, due primarily to impairment charges on non-real estate assets, higher interest expense and lower Adjusted OIBDA.

AFFO attributable to OUTFRONT Media Inc.

decreased $15.2 million, or 16%, in the three months ended June 30, 2023, compared to the same prior-year period, due primarily to higher interest expense and lower Adjusted OIBDA.

decreased $10.8 million, or 12%, in the three months ended September 30, 2023, compared to the same prior-year period, due primarily to higher interest expense and lower Adjusted OIBDA.

AFFO attributable to OUTFRONT Media Inc.

decreased $41.9 million, or 33%, in the six months ended June 30, 2023, compared to the same prior-year period, due primarily to higher interest expense, lower Adjusted OIBDA, the impact of direct lease acquisition costs and higher maintenance capital expenditures.

decreased $52.7 million, or 24%, in the nine months ended September 30, 2023, compared to the same prior-year period, due primarily to higher interest expense, lower Adjusted OIBDA and higher maintenance capital expenditures.

Segment Results of Operations

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Media and Other .

The following table presents our Revenues , Adjusted OIBDA and Operating income by segment in the three and six months ended June 30, 2023 and 2022.

Three Months Ended Six Months Ended

June 30, June 30,

The following table presents our Revenues , Adjusted OIBDA and Operating income by segment in the three and nine months ended September 30, 2023 and 2022.

Three Months Ended Nine Months Ended

September 30, September 30,

(in millions) 2023 2022 2023 2022

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Operating income (loss) $ 58.6 $ 74.3 $ (369.4) $ 182.7

Net (gain) loss on dispositions (0.1) 0.2 0.2 (0.1)

Net loss on dispositions — 0.2 0.2 0.1

Impairment charges 12.1 — 523.5 —

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(a) Stock-based compensation is classified as Corporate expense.

Three Months Ended Six Months Ended

June 30, % June 30, %

Three Months Ended Nine Months Ended

September 30, % September 30, %

(in millions, except percentages) 2023 2022 Change 2023 2022 Change

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Operating income (loss) $ 72.7 $ 91.3 * $ (314.9) $ 235.9 *

Net (gain) loss on dispositions (0.1) 0.2 * 0.2 (0.1) *

Net loss on dispositions — 0.2 * 0.2 0.1 100

Impairment charges 12.1 — * 523.5 — *

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(a) Organic revenues exclude revenues associated with a significant acquisition (“non-organic revenues”).

Media segment revenues increased $20.5 million, or 5%, in the three months ended June 30, 2023, compared to the same prior-year period, due primarily to higher billboard revenues.

Media segment revenues increased $42.7 million, or 5%, in the six months ended June 30, 2023, compared to the same prior-year period, due primarily to higher billboard revenues.

We generated approximately 42% in each of the three months ended June 30, 2023 and 2022, 41% in the six months ended June 30, 2023, and 42% in the six months ended June 30, 2022, of our U.S.

Media segment revenues increased $0.7 million in the three months ended September 30, 2023, compared to the same prior-year period, due primarily to higher billboard revenues.

Media segment revenues increased $43.4 million, or 4%, in the nine months ended September 30, 2023, compared to the same prior-year period, due primarily to higher billboard revenues.

We generated approximately 42% in the three months ended September 30, 2023, 45% in the three months ended September 30, 2022, 42% in the nine months ended September 30, 2023, and 43% in the nine months ended September 30, 2022, of our U.S.

Media segment revenues from national advertising campaigns.

In the three and six months ended June 30, 2023, non-organic revenues reflect the impact of a significant acquisition.

In the nine months ended September 30, 2023 and 2022, non-organic revenues reflect the impact of a significant acquisition.

Billboard revenues in the U.S.

Media segment increased $20.1 million, or 6%, in the three months ended June 30, 2023, compared to the same prior-year period, reflecting an increase in average revenue per display (yield) and the impact of new and lost billboards in the period, including acquisitions.

Media segment increased $8.7 million, or 3%, in the three months ended September 30, 2023, compared to the same prior-year period, reflecting an increase in average revenue per display (yield) and the impact of new and lost billboards in the period, including acquisitions.

Billboard revenues in the U.S.

Media segment increased $42.8 million, or 7%, in the six months ended June 30, 2023, compared to the same prior-year period, reflecting an increase in average revenue per display (yield), the impact of new and lost billboards in the period, including acquisitions, and higher proceeds from condemnations.

Media segment increased $51.5 million, or 5%, in the nine months ended September 30, 2023, compared to the same prior-year period, reflecting an increase in average revenue per display (yield), the impact of new and lost billboards in the period, including acquisitions, and higher proceeds from condemnations.

Organic billboard revenues in the U.S.

Media segment increased $18.7 million, or 6%, in the three months ended June 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield) and the impact of new and lost billboards in the period, including insignificant acquisitions.

Media segment increased $8.7 million, or 3%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield) and the impact of new and lost billboards in the period, including acquisitions.

Organic billboard revenues in the U.S.

Media segment increased $38.5 million, or 6%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), the impact of new and lost billboards in the period, including insignificant acquisitions, and higher proceeds from condemnations.

Media segment increased $47.4 million, or 5%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily due to an increase in average revenue per display (yield), the impact of new and lost billboards in the period, including insignificant acquisitions, and higher proceeds from condemnations.

Transit and other revenues in the U.S.

Media segment increased $0.4 million in the three months ended June 30, 2023 compared to the same prior-year period, primarily driven by the impact of a new transit franchise contract.

Media segment decreased $8.0 million in the three months ended September 30, 2023 compared to the same prior-year period, primarily driven by a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays, partially offset by the impact of a new transit franchise contract.

Transit and other revenues in the U.S.

Media segment decreased $0.1 million in the six months ended June 30, 2023, compared to the same prior-year period, primarily driven by a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays, partially offset by the impact of a new transit franchise contract.

Media segment decreased $8.1 million in the nine months ended September 30, 2023, compared to the same prior-year period, primarily driven by a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays, partially offset by the impact of a new transit franchise contract.

Organic transit and other revenues in the U.S.

Media segment increased $0.4 million in the three months ended June 30, 2023, compared to the same prior-year period, primarily driven by the impact of a new transit franchise contract, partially offset by a decrease in average revenue per display (yield).

Media segment decreased $8.0 million in the three months ended September 30, 2023, compared to the same prior-year period, primarily due to a decrease in average revenue per display (yield), driven by weaker market conditions in national advertising, which primarily impacted advertising sales on certain above-ground advertising displays, partially offset by the impact of a new transit franchise contract.

Organic transit and other revenues in the U.S.

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Operating expenses in the U.S.

Media segment increased $20.3 million, or 10%, in the three months ended June 30, 2023, compared to the same prior-year period, primarily driven by higher variable billboard property lease expenses, the impact of new locations, including through acquisitions, higher guaranteed minimum annual payments to the MTA, higher taxes and higher compensation-related expenses.

Media segment increased $7.1 million, or 3%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily driven by higher variable billboard property lease expenses, the impact of new locations, including through acquisitions, higher guaranteed minimum annual payments to the MTA and higher compensation-related expenses, partially offset by a decline in non-MTA transit franchise costs.

Operating expenses in the U.S.

Media segment increased $43.5 million, or 11%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily driven by higher variable billboard property lease expenses, including an out-of-period adjustment of $5.2 million recorded in the six months ended June 30, 2023, (see Note 1.

Description of Business and Basis of Presentation to the Consolidated Financial Statements), higher guaranteed minimum annual payments to the MTA, higher taxes, higher maintenance and utilities cost, higher taxes, higher maintenance and utilities cost, driven by inflation-driven cost increases in 2023, higher compensation-related expenses, and increased activity resulting in higher materials cost, partially offset by lower posting and rotation costs.

Media segment increased $50.6 million, or 8%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily driven by higher variable billboard property lease expenses, including an out-of-period adjustment of $5.2 million recorded in the nine months ended September 30, 2023, (see Note 1.

Description of Business and Basis of Presentation to the Consolidated Financial Statements), higher guaranteed minimum annual payments to the MTA, higher maintenance and utilities cost, driven by inflationary cost increases in 2023, higher compensation-related expenses, and increased activity resulting in higher materials cost, partially offset by lower posting and rotation costs.

SG&A expenses in the U.S.

Media segment increased $1.3 million, or 2%, in the three months ended June 30, 2023, compared to the same prior-year period, primarily driven by higher compensation-related expenses, partially offset by a lower provision for doubtful accounts.

Media segment increased $1.6 million, or 2%, in the three months ended September 30, 2023, compared to the same prior-year period, primarily driven by a higher provision for doubtful accounts and higher professional fees, partially offset by lower compensation-related expenses.

SG&A expenses in the U.S.

Media segment increased $8.3 million, or 5%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily driven by higher compensation-related expenses, higher professional fees and higher travel and entertainment expenses.

In the three months ended June 30, 2023, we recorded impairment charges of $511.4 million in the U.S.

Media segment increased $9.9 million, or 4%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily driven by higher compensation-related expenses, higher professional fees and a higher provision for doubtful accounts.

In the nine months ended September 30, 2023, we recorded impairment charges of $523.5 million in the U.S.

Media segment, primarily related to impairment charges related to our MTA asset group and our U.S.

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Long-Lived Assets to the Consolidated Financial Statements).

Media segment Adjusted OIBDA decreased $1.1 million, or 1%, in the three months ended June 30, 2023, and decreased $9.1 million, or 4%, in the six months ended June 30, 2023, compared to the same prior-year periods.

Adjusted OIBDA margin was 29% in the three months ended June 30, 2023, 31% in the three months ended June 30, 2022, 24% in the six months ended June 30, 2023, and 27% in the six months ended June 30, 2022.

The decreases in Adjusted OIBDA margins was due primarily to a higher increase in operating expenses, due to an increase in billboard property lease expenses, including an out-of-period adjustment of $5.2 million recorded in the six months ended June 30, 2023, related to variable billboard property lease expenses (see Note 1.

Description of Business and Basis of Presentation to the Consolidated Financial Statements), increases in the MTA guaranteed minimum annual payments in 2023 and an increase in SG&A expenses, compared to a lower increase in revenues.

Three Months Ended Six Months Ended

June 30, % June 30, %

Media segment Adjusted OIBDA decreased $8.0 million, or 6%, in the three months ended September 30, 2023, and decreased $17.1 million, or 5%, in the nine months ended September 30, 2023, compared to the same prior-year periods.

Adjusted OIBDA margin was 28% in the three months ended September 30, 2023, 30% in the three months ended September 30, 2022, 26% in the nine months ended September 30, 2023, and 28% in the nine months ended September 30, 2022.

The decreases in Adjusted OIBDA margins was due primarily to a higher increase in operating expenses, due to an increase in billboard property lease expenses, including an out-of-period adjustment of $5.2 million recorded in the nine months ended September 30, 2023, related to variable billboard property lease expenses (see Note 1.

Description of Business and Basis of

Presentation to the Consolidated Financial Statements), increases in the MTA guaranteed minimum annual payments in 2023 and an increase in SG&A expenses, compared to a lower increase in revenues.

Three Months Ended Nine Months Ended

September 30, % September 30, %

(in millions, except percentages) 2023 2022 Change 2023 2022 Change

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

Total Other revenues decreased $1.9 million, or 7%, in the three months ended June 30, 2023, compared to the same prior-year period, driven by the impact of foreign currency exchange rates and a decrease in average revenue per display (yield) as we have experienced decreases in overall demand for our services, partially offset by the impact of acquisitions.

Total Other revenues decreased $1.8 million, or 4%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily driven by the impact of foreign currency exchange rates, partially offset by the impact of acquisitions.

In the three and six months ended June 30, 2022, non-organic revenues reflect the impact of foreign currency exchange rates.

Organic Other revenues decreased $0.4 million, or 2%, in the three months ended June 30, 2023, compared to the same prior-year period, driven by a decrease in average revenue per display (yield) as we have experienced decreases in overall demand for our services during the quarter, partially offset by the impact of acquisitions.

Organic Other revenues increased $0.8 million, or 2%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily driven by the impact of acquisitions.

Other operating expenses decreased $0.9 million, or 6%, in the three months ended June 30, 2023, and decreased $1.4 million, or 5%, in the six months ended June 30, 2023, compared to the same prior-year periods, primarily driven by the impact of foreign currency exchange rates and lower expenses in Canada.

Other SG&A expenses increased $0.1 million, or 2%, in the three months ended June 30, 2023, and increased $0.2 million, or 2%, in the six months ended June 30, 2023, compared to the same prior-year periods, primarily driven by higher expenses in Canada, partially offset by the impact of foreign currency exchange rates.

Other Adjusted OIBDA decreased $1.1 million, or 14%, in the three months ended June 30, 2023, and decreased $0.6 million, or 7%, in the six months ended June 30, 2023, compared to the same prior-year periods.

The decreases were due primarily to

the impact of foreign currency exchange rates and a decrease in average revenue per display (yield), partially offset by higher expenses in Canada.

Total Other revenues increased $0.4 million, or 2%, in the three months ended September 30, 2023, compared to the same prior-year period, driven by the impact of new billboards in the period and an increase in average revenue per display (yield) as we have experienced increases in overall demand for our services, partially offset by the impact of foreign currency exchange rates.

Total Other revenues decreased $1.4 million, or 2%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily driven by the impact of foreign currency exchange rates, partially offset by the impact of new billboards in the period, including acquisitions, and an increase in average revenue per display (yield) as we have experienced increases in overall demand for our services.

In the three and nine months ended September 30, 2022, non-organic revenues reflect the impact of foreign currency exchange rates.

Organic Other revenues increased $1.0 million, or 4%, in the three months ended September 30, 2023, compared to the same prior-year period, driven by the impact of acquisitions and an increase in average revenue per display (yield) as we have experienced increases in overall demand for our services during the quarter.

Organic Other revenues increased $1.8 million, or 3%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily driven by the impact of new billboards in the period, including acquisitions, and an increase in average revenue per display (yield) as we have experienced increases in overall demand for our services during the quarter.

Other operating expenses increased $0.1 million, or 1%, in the three months ended September 30, 2023, compared to the same prior-year period, driven by higher expenses in Canada, partially offset by the impact of foreign currency exchange rates.

Other operating expenses decreased $1.3 million, or 3%, in the nine months ended September 30, 2023, compared to the same prior-

year period, primarily driven by the impact of foreign currency exchange rates.

Other SG&A expenses decreased $0.2 million, or 3%, in the three months ended September 30, 2023, and was flat in the nine months ended September 30, 2023, compared to the same prior-year periods, primarily driven by the impact of foreign currency exchange rates, partially offset by higher expenses in Canada.

Other Adjusted OIBDA increased $0.5 million, or 9%, in the three months ended September 30, 2023, compared to the prior-year period, due primarily to an increase in average revenue per display (yield), partially offset by the impact of foreign exchange rates.

Other Adjusted OIBDA decreased $0.1 million, or 1%, in the nine months ended September 30, 2023, compared to the same prior-year periods, due primarily to the impact of foreign currency exchange rates and higher expenses in Canada, partially offset by an increase in average revenue per display (yield).

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

Corporate expenses, excluding stock-based compensation, were $12.6 million in the three months ended June 30, 2023, compared to $11.7 million in the same prior-year period.

Corporate expenses, excluding stock-based compensation, were $25.6 million in the six months ended June 30, 2023, compared to $22.2 million in the same prior-year period.

The increases were primarily due to the impact of market fluctuations on an unfunded equity-linked retirement plan offered by the Company to certain employees, partially offset by lower compensation-related expenses.

Corporate expenses, excluding stock-based compensation, were $9.6 million in the three months ended September 30, 2023, compared to $10.8 million in the same prior-year period.

Corporate expenses decreased $1.2 million, or 11%, in the three months ended September 30, 2023, compared to the same prior-year period primarily due to lower compensation-related expenses, partially offset by the impact of market fluctuations on an unfunded equity-linked retirement plan offered by the Company to certain employees.

Corporate expenses, excluding stock-based compensation, were $35.2 million in the nine months ended September 30, 2023, compared to $33.0 million in the same prior-year period.

Corporate expenses increased $2.2 million, or 7%, primarily due to the impact of market fluctuations on an unfunded equity-linked retirement plan offered by the Company to certain employees, partially offset by lower compensation-related expenses.

Liquidity and Capital Resources

(in millions, except percentages) June 30,

(in millions, except percentages) September 30,

2023 December 31, 2022 % Change

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(See the “Overview” section of this MD&A.)

Working capital was a deficit of $269.8 million as of June 30, 2023, compared to a deficit of $161.2 million as of December 31, 2022, primarily driven by increased borrowings under the AR Facility, lower receivable balances, and increased short-term operating lease liabilities.

Working capital was a deficit of $276.0 million as of September 30, 2023, compared to a deficit of $161.2 million as of December 31, 2022, primarily driven by increased borrowings under the AR Facility, lower receivable balances, and increased short-term operating lease liabilities.

Under the current MTA agreement, which was amended in June 2020 and July 2021 and is subject to modification as agreed-upon by us and the MTA (as amended, the “MTA Agreement”):

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For any deployment costs deemed authorized after December 31, 2020, the MTA and the Company will no longer be obligated to directly pay 70% and 30% of the costs, respectively, and these costs will be subject to recoupment in accordance with the MTA Agreement.

We did not recoup any equipment deployment costs in the six months ended June 30, 2023, and we do not expect to recoup any equipment deployment costs in the remainder of 2023.

We did not recoup any equipment deployment costs in the nine months ended September 30, 2023, and we do not expect to recoup any equipment deployment costs in the remainder of 2023.

In addition, we currently do not expect to recoup any equipment deployment costs throughout the remainder of the Amended Term (as defined below) of the MTA Agreement.

For the full year of 2023, we expect our MTA equipment deployment costs to be approximately $50.0 million to $60.0 million.

We expect our MTA equipment deployment costs to be approximately $95.00 million in the aggregate over the next 18 months, with approximately $30.0 million to $40.0 million to be spent in the remainder of 2023 and approximately $50.0 million to $60.0 million to be spent in 2024.

For the full year of 2023, we expect our MTA equipment deployment costs to be approximately $45.0 million.

We expect our MTA equipment deployment costs to be approximately $50.0 million to $60.0 million in 2024.

After 2024, we expect MTA equipment deployment costs to be approximately $30.0 million to $40.0 million annually throughout the remainder of the Amended Term (as defined below) of the MTA Agreement and encompass replacement costs.

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Our payment obligations with respect to guaranteed minimum annual payment amounts owed to the MTA resumed on January 1, 2021, in accordance with the terms of the MTA Agreement, and 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.

Year”), the MTA is entitled to receive an additional payment equal to 2.5% of the annual base revenue amount for such year calculated in accordance with the MTA Agreement, provided that gross revenues in such year (i) were at least equal to the gross revenues generated in the Recoupment Year, and (ii) did not decline by more than 5% from the prior year.

The MTA Agreement also provides that if prior to April 1, 2028 the balance of unrecovered costs of deploying advertising and communications screens throughout the transit system is equal to or less than zero, then in any year following the year in which such recoupment occurs (the “Recoupment Year”), the MTA is entitled to receive an additional payment equal to 2.5% of the annual base revenue amount for such year calculated in accordance with the MTA Agreement, provided that gross revenues in such year (i) were at least equal to the gross revenues generated in the Recoupment Year, and (ii) did not decline by more than 5% from the prior year.

In July 2021, we extended the initial 10-year term of the MTA Agreement to a 13-year base term (the “Amended Term”).

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However, given the current heightened levels of inflation and related economic environment, we cannot reasonably estimate the aggregate financing amount, if any, at this time.

As of June 30, 2023, we have issued surety bonds 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, 2023, we have issued surety bonds 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 indicated in the table below, we incurred $20.6 million related to MTA equipment deployment costs in the six months ended June 30, 2023 (which includes equipment deployment costs related to future deployments), for a total of $556.5 million to date, of which $33.9 million had been recouped from incremental revenues to date.

As of June 30, 2023, 16,758 digital displays had been installed, composed of 5,135 digital advertising screens on subway and train platforms and entrances, 6,952 smaller-format digital advertising screens on rolling stock and 4,671 MTA communications displays.

In the three months ended June 30, 2023, 1,558 installations occurred, for a total of 2,605 installations occurring in the six months ended June 30, 2023.

We performed an analysis of carrying value of our long-lived asset groups within our U.S.

As indicated in the table below, we incurred $32.7 million related to MTA equipment deployment costs in the nine months ended September 30, 2023 (which includes equipment deployment costs related to future deployments), for a total of $568.6 million to date, of which $33.9 million had been recouped from incremental revenues to date.

As of September 30, 2023, 18,786 digital displays had been installed, composed of 5,117 digital advertising screens on subway and train platforms and entrances, 8,760 smaller-format digital advertising screens on rolling stock and 4,909 MTA communications displays.

In the three months ended September 30, 2023, 2,028 installations occurred, for a total of 4,633 installations occurring in the nine months ended September 30, 2023.

During the second quarter of 2023, we performed an analysis of the carrying value of our long-lived asset groups within our U.S.

Transit and Other reporting unit as a result of the triggering event noted above utilizing undiscounted cash flows compared to the carrying value of the asset groups.

As a result, we recorded an impairment charge of $463.5 million in the second quarter of 2023, primarily representing a $443.1 million impairment charge related to our MTA asset group.

(See the “Critical Accounting Policies” section of this MD&A and Note 4.

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(in millions) Beginning Balance Deployment Costs Incurred Recoupment/MTA Funding Amortization/Impairment Reclassification Ending Balance

Six months ended June 30, 2023:

Nine months ended September 30, 2023:

Prepaid MTA equipment deployment costs $ 363.2 $ 21.8 $ — $ — $ (385.0) $ —

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Total $ 348.0 $ 88.9 $ (3.7) $ (6.4) $ — $ 426.8

On August 3, 2023, we announced that our board of directors approved a quarterly cash dividend of $0.30 per share on our common stock, payable on September 29, 2023, to stockholders of record at the close of business on September 1, 2023.

On November 2, 2023, we announced that our board of directors approved a quarterly cash dividend of $0.30 per share on our common stock, payable on December 29, 2023, to stockholders of record at the close of business on December 1, 2023.

Debt, net, consists of the following:

(in millions, except percentages) June 30,

(in millions, except percentages) September 30,

2023 December 31,

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Total $ 3,410.4 $ 153.5 $ 680.0 $ 1,487.2 $ 1,089.7

The interest rate on the term loan due in 2026 (the “Term Loan”) was 6.9% per annum as of June 30, 2023.

As of June 30, 2023, a discount of $1.2 million on the Term Loan remains unamortized.

The interest rate on the term loan due in 2026 (the “Term Loan”) was 7.1% per annum as of September 30, 2023.

As of September 30, 2023, a discount of $1.1 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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The Amendments provide for (i) the replacement of the London Interbank Offered Rate with the Secured Overnight Financing Rate as the interest rate benchmark , (ii) the extension of the maturity date of the Revolving Credit Facility from its previous maturity date of November 18, 2024 to June 15, 2028, and (iii) an increase in the interest rate margins applicable to the Borrowers under the Revolving Credit Facility from a range of 1.25% to 1.75% to a range of 1.75% to 2.25%, in the case of Secured Overnight Financing Rate borrowings, based on the Borrowers’ leverage ratio.

The Amendments also include springing maturity refinancing provisions with respect to the Borrowers’ outstanding term loan indebtedness and certain series of senior notes

issued by the Borrowers, in each case, which have maturity dates prior to June 15, 2028, as well as other clarifying, conforming and ministerial changes to the Credit Agreement.

As of June 30, 2023, 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 $0.4 million in each of the three months ended June 30, 2023 and 2022, $0.8 million in each of the six months ended June 30, 2023 and 2022.

As of June 30, 2023, we had issued letters of credit totaling approximately $6.5 million against the letter of credit facility sublimit under the Revolving Credit Facility.

The Amendments also include springing maturity refinancing provisions with respect to the Borrowers’ outstanding term loan indebtedness and certain series of senior notes issued by the Borrowers, in each case, which have maturity dates prior to June 15, 2028, as well as other clarifying, conforming and ministerial changes to the Credit Agreement.

As of September 30, 2023, 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 $0.5 million in the three months ended September 30, 2023, $0.4 million in the three months ended September 30, 2022, $1.3 million in the nine months ended September 30, 2023, and $1.2 million in the nine months ended September 30, 2022.

As of September 30, 2023, we had issued letters of credit totaling approximately $6.5 million against the letter of credit facility sublimit under the Revolving Credit Facility.

Standalone Letter of Credit Facilities

As of June 30, 2023, we had issued letters of credit totaling approximately $77.1 million under our aggregate $81.0 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, 2023 and 2022.

As of September 30, 2023, we had issued letters of credit totaling approximately $75.7 million under our aggregate $81.0 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, 2023 and 2022.

Accounts Receivable Securitization Facility

As of June 30, 2023, we have a $150.0 million revolving accounts receivable securitization facility (the “AR Facility”), which terminates in May 2025, unless further extended.

As of September 30, 2023, we have a $150.0 million revolving accounts receivable securitization facility (the “AR Facility”), which terminates in May 2025, unless further extended.

In connection with the AR Facility, Outfront Media LLC and Outfront Media Outernet Inc., each a wholly-owned subsidiary of the Company, and certain of the Company’s TRSs (the “Originators”), will sell and/or contribute their respective existing and future accounts receivable and certain related assets to either Outfront Media Receivables LLC, a special purpose vehicle and wholly-owned subsidiary of the Company relating to the Company’s qualified REIT subsidiary accounts receivable assets (the “QRS SPV”) or Outfront Media Receivables TRS, LLC a special purpose vehicle and wholly-owned subsidiary of the Company relating to the Company’s TRS accounts receivable assets (the “TRS SPV” and together with the QRS SPV, the “SPVs”).

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The SPVs are separate legal entities with their own separate creditors who will be entitled to access the SPVs’ assets before the assets become available to the Company.

Accordingly, the SPVs’ assets are not available to pay creditors of the Company or any of its subsidiaries, although collections from the receivables in excess of amounts required to repay the Purchasers and other creditors of the SPVs may be remitted to the Company.

Accordingly, the SPVs’ assets are not available to pay creditors of the Company or any of its subsidiaries, although collections from the receivables in excess of amounts required

to repay the Purchasers and other creditors of the SPVs may be remitted to the Company.

Outfront Media LLC will service the accounts receivables on behalf of the SPVs for a fee.

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Further, the TRS SPV and the QRS SPV are jointly and severally liable for their respective obligations under the agreements governing the AR Facility.

As of June 30, 2023, there were $135.0 million outstanding borrowings under the AR Facility, at a borrowing rate of 6.2%.

As of June 30, 2023, borrowing capacity remaining under the AR Facility was $15.0 million based on approximately $320.0 million of accounts receivable that could be used as collateral for the AR Facility in accordance with the agreements governing the AR Facility.

The commitment fee based on the amount of unused commitments under the AR Facility was immaterial for the three months ended June 30, 2023, $0.1 million for the six months ended June 30, 2023, and immaterial for each of the three and six months ended June 30, 2022.

As of September 30, 2023, there were $150.0 million of outstanding borrowings under the AR Facility, at a borrowing rate of 6.4%.

As of September 30, 2023, there is no borrowing capacity remaining under the AR Facility based on approximately $317.7 million of accounts receivable that could be used as collateral for the AR Facility in accordance with the agreements governing the AR Facility.

The commitment fee based on the amount of unused commitments under the AR Facility was immaterial for the three months ended September 30, 2023, $0.1 million for the nine months ended September 30, 2023, and immaterial for each of the three and nine months ended September 30, 2022.

As of November 2, 2023, there were $140.0 million of outstanding borrowings under the AR Facility, at a borrowing rate of 6.4%.

Debt Covenants

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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, 2023, our Consolidated Total Leverage Ratio was 5.1 to 1.0 in accordance with the Credit Agreement.

As of September 30, 2023, our Consolidated Total Leverage Ratio was 5.2 to 1.0 in accordance with the Credit Agreement.

The terms of the Credit Agreement (and under certain circumstances, the agreements governing the AR Facility) 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, 2023, our Consolidated Net Secured Leverage Ratio was 1.1 to 1.0 in accordance with the Credit Agreement.

As of June 30, 2023, we are in compliance with our debt covenants.

As of September 30, 2023, our Consolidated Net Secured Leverage Ratio was 1.1 to 1.0 in accordance with the Credit Agreement.

As of September 30, 2023, we are in compliance with our debt covenants.

Deferred Financing Costs

As of June 30, 2023, we had deferred $25.7 million in fees and expenses associated with the Term Loan, Revolving Credit Facility, AR Facility and our senior unsecured notes.

As of September 30, 2023, we had deferred $24.1 million in fees and expenses associated with the Term Loan, Revolving Credit Facility, AR Facility 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 Facility and our senior unsecured notes.

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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 six months ended June 30, 2023.

As of June 30, 2023, we had approximately $232.5 million of capacity remaining under the ATM Program.

No shares were sold under the ATM Program during the nine months ended September 30, 2023.

As of September 30, 2023, we had approximately $232.5 million of capacity remaining under the ATM Program.

Series A Preferred Stock Issuance

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The Series A Preferred Stock ranks senior to the shares of the Company’s common stock with respect to dividend and distribution rights.

Holders of the Series A Preferred Stock are entitled to a cumulative dividend accruing at the initial rate of 7.0% per year, payable quarterly in arrears, subject to increases as set forth in the Articles Supplementary, effective as of April 20, 2020 (the “Articles”).

Supplementary, effective as of April 20, 2020 (the “Articles”).

Dividends may, at the option of the Company, be paid in cash, in-kind, through the issuance of additional shares of Series A Preferred Stock or a combination of cash and in-kind, until April 20, 2028, after which time dividends will be payable solely in cash.

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Subject to certain conditions set forth in the Articles (including a change of control), each of the Company and the holders of the Series A Preferred Stock may convert or redeem the Series A Preferred Stock at the prices set forth in the Articles, plus any accrued and unpaid dividends.

The following table presents our cash flows in the six months ended June 30, 2023 and 2022.

Six Months Ended

The following table presents our cash flows in the nine months ended September 30, 2023 and 2022.

Nine Months Ended

September 30, %

(in millions, except percentages) 2023 2022 Change

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* Calculation is not meaningful.

Cash provided by operating activities decreased $13.4 million, or 13%, in the six months ended June 30, 2023, compared to the same prior-year period, due primarily to lower net income in 2023 compared to 2022, due to increased operating and SG&A expenses, and higher interest expense, as well as the timing of payments, partially offset by a decrease in prepaid MTA equipment deployment costs.

In the six months ended June 30, 2023, we paid net cash of $21.3 million related to MTA equipment deployment costs and installed 2,605 digital displays.

In the six months ended June 30, 2022, we paid net cash of $44.5 million related to MTA equipment deployment costs and installed 2,069 digital displays.

Cash used for investing activities decreased $222.9 million, or 76%, in the six months ended June 30, 2023, compared to the same prior-year period, due primarily to lower cash paid for acquisitions.

The following table presents our capital expenditures in the six months ended June 30, 2023 and 2022.

Six Months Ended

Cash provided by operating activities decreased $25.6 million, or 15%, in the nine months ended September 30, 2023, compared to the same prior-year period, due primarily to lower net income in 2023 compared to 2022, due to increased operating and SG&A expenses, and higher interest expense, as well as the timing of payments, partially offset by a decrease in prepaid MTA equipment deployment costs.

In the nine months ended September 30, 2023, we paid net cash of $33.4 million related to MTA equipment deployment costs and installed 4,633 digital displays.

In the nine months ended September 30, 2022, we paid net cash of $57.5 million related to MTA equipment deployment costs and installed 2,565 digital displays.

Cash used for investing activities decreased $257.9 million, or 73%, in the nine months ended September 30, 2023, compared to the same prior-year period, due primarily to lower cash paid for acquisitions.

The following table presents our capital expenditures in the nine months ended September 30, 2023 and 2022.

Nine Months Ended

September 30, %

(in millions, except percentages) 2023 2022 Change

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Total capital expenditures $ 63.6 $ 66.6 (5)

Capital expenditures increased $3.1 million, or 7%, in the six months ended June 30, 2023, compared to the same prior-year period, primarily due to the timing of payments related to growth in digital displays and maintenance spending for billboard display upgrades, and higher spending related to the renovation of certain office facilities.

Capital expenditures decreased $3.0 million, or 5%, in the nine months ended September 30, 2023, compared to the same prior-year period, primarily due to the timing of payments related to growth in digital displays and maintenance spending for billboard display upgrades, partially offset by higher spending related to the renovation of certain office facilities.

For the full year of 2023, we expect our capital expenditures to be approximately $80.0 million to $85.0 million, which will be used primarily for growth in digital displays, the renovation of certain office facilities, software and technology, maintenance, and safety-related projects.

This estimate does not include equipment deployment costs that will be incurred in connection with the MTA Agreement (as described above).

Cash used for financing activities decreased $99.5 million, or 87%, in the six months ended June 30, 2023, compared to the same prior-year period.

In the six months ended June 30, 2023, we drew $105.0 million of borrowings on the AR Facility and paid total cash dividends of $103.7 million on our common stock, the Series A Preferred Stock and vested restricted share units granted to employees.

In the six months ended June 30, 2022, we paid total cash dividends of $102.9 million on our common stock, the Series A Preferred Stock and vested restricted share units granted to employees.

Cash paid for income taxes was $5.5 million in the six months ended June 30, 2023 and $2.9 million in the six months ended June 30, 2022.

The increase was primarily due to the timing of payments related to Canada.

Cash used for financing activities decreased $113.7 million, or 69%, in the nine months ended September 30, 2023, compared to the same prior-year period.

In the nine months ended September 30, 2023, we drew $120.0 million of borrowings on the AR Facility and paid total cash dividends of $155.4 million on our common stock, the Series A Preferred Stock and vested restricted share units granted to employees.

In the nine months ended September 30, 2022, we paid total cash dividends of $154.3 million on our common stock, the Series A Preferred Stock and vested restricted share units granted to employees.

Cash paid for income taxes was $5.9 million in the nine months ended September 30, 2023 and $3.1 million in the nine months ended September 30, 2022.

The increase was primarily due to the timing of Canadian estimated income tax payments.

Off-Balance Sheet Arrangements

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This assessment requires evaluating qualitative and quantitative factors to determine if there is an indication that the carrying amount may not be recoverable.

Management applies significant judgment in assessing these factors, including evaluating macroeconomic conditions, product demand, industry trends, and events specific to the Company, including monitoring the Company’s actual installation of digital displays against the initial deployment schedule.

Management applies significant judgment in assessing these factors, including evaluating macroeconomic conditions, product demand, industry trends, and

events specific to the Company, including monitoring the Company’s actual installation of digital displays against the initial deployment schedule.

Additionally, management assesses quantitative factors by comparing revenue projections of the deployed digital displays to actual financial results.

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By the end of the first half of 2023, it was determined that our MTA transit revenue recovery had stalled since our MTA transit revenue did not meet our revenue expectations, and as of June 30, 2023, our revenue pacing and outlook for the remainder of 2023 reflects a continued decline in MTA transit revenues as compared to our 2023 forecast due to the underperformance across the MTA transit system.

Accordingly, we updated our revenue projections to reflect no growth in 2023 followed by 5% to 10% growth throughout the remainder of the Amended Term of the MTA Agreement.

Accordingly, in the second quarter of 2023, we updated our revenue projections to reflect no growth in 2023 followed by 5% to 10% growth throughout the remainder of the Amended Term of the MTA Agreement.

As a result of the reduced revenue forecast and reduced time remaining on the Amended Term of the MTA Agreement, we currently do not expect to recoup any Prepaid MTA equipment deployment costs throughout the remainder of the Amended Term of the MTA Agreement.

As a result, we reclassified $385.0 million of Prepaid MTA equipment deployment costs to Intangible Assets.

We then reviewed our MTA long-lived asset group to determine if there was a triggering event for impairment, noting that we currently project negative aggregate cash flows of approximately $50.0 million through the remainder of the Amended Term of the MTA Agreement.

Consequently, we have recorded an impairment charge of $443.1 million, representing all of our MTA long-lived asset group.

All future deployment costs spending will be recorded as Intangible assets until such time as we project to recoup spending from transit franchise fees that would otherwise be payable to the MTA, which we currently do not expect throughout the remainder of the Amended Term of the MTA Agreement.

As a result, in the second quarter of 2023, we reclassified $385.0 million of Prepaid MTA equipment deployment costs to Intangible Assets.

We then reviewed our MTA long-lived asset group to determine if there was a triggering event for impairment, noting that we were projecting negative aggregate cash flows of approximately $50.0 million through the remainder of the Amended Term of the MTA Agreement.

Consequently, in the second quarter of 2023, we recorded an impairment charge of $443.1 million, representing all of our MTA long-lived asset group.

All future deployment costs spending will be recorded as Intangible assets rather than as Prepaid MTA equipment deployment costs until such time as we project to recoup spending from transit franchise fees that would otherwise be payable to the MTA, which we currently do not expect throughout the remainder of the Amended Term of the MTA Agreement.

Even if we do not recoup our spending from transit franchise fees that would otherwise be payable to the MTA, our current projections are that the MTA Agreement will be cash flow neutral (i.e., Adjusted OIBDA related to the MTA Agreement will equal MTA equipment deployment costs) over the remaining Amended Term of the MTA Agreement beginning during 2024.

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Currently, future impairment charges (i) are expected to be required during the remainder of 2023 with respect to all or a portion of the up to approximately $10.0 million to $15.0 million of MTA equipment deployment costs we expect to spend in the remainder of 2023, (ii) may be required during 2024 with respect to all or a portion of the up to approximately $50.0 million to $60.0 million of MTA equipment deployment costs we expect to spend in 2024, and (iii) may be required beyond 2024 with respect to all or a portion of the additional MTA equipment deployment costs we will be required to incur under the MTA Agreement, in each case, to the extent we continue to project cash flow losses throughout the remainder of the Amended Term of the MTA Agreement based on the assumptions and estimates described in this section and/or other factors that may arise.

We performed a sensitivity analysis on our MTA transit revenue assumptions, noting that a change in our annual revenue growth rate of 1% between 2024 and 2030, holding all other assumptions constant except for variable sales compensation, would result in an approximately $70.0 million aggregate change in estimated cash flows.

Our performance during the third quarter of 2023 is in line with our expectations as of the end of the second quarter of 2023.

We evaluated our long-term MTA revenue projections as of the end of the third quarter of 2023, and we continue to believe that MTA transit revenue for 2023 will be flat compared to the prior year period;

we are also not aware of any changes in facts or circumstances, which would result in a change to our long-term revenue projections.

As a result, we continue to project negative aggregate cash flows of $35.0 million until we will be cash flow neutral beginning during 2024.

Consequently, we recorded an additional impairment charge in the third quarter of 2023, of $12.1 million, representing the additional equipment deployment cost spending during the quarter.

We performed a sensitivity analysis on our MTA transit revenue assumptions at the time of the impairment during the second quarter of 2023, noting that a change in our annual revenue growth rate of 1% between 2024 and 2030, holding all other assumptions constant except for variable sales compensation, would result in an approximately $70.0 million aggregate change in estimated cash flows.

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

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A qualitative test assesses macroeconomic conditions, industry and market conditions, cost factors, overall financial performance and other relevant entity specific events, as well as events affecting a reporting unit.

If after the qualitative assessment, we determined that it is more likely than not that the fair value of a reporting unit is less than its carrying value, we perform a quantitative assessment.

If after the qualitative assessment, we determined that it is more likely than not that the fair value of a reporting unit is less than its carrying

value, we perform a quantitative assessment.

We may also choose to only perform a quantitative assessment.

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We believe this growth will be driven by expected revenue generation from increased demand for transit digital displays due to additional rolling stock digital deployment in the MTA transit system and additional digital deployment in other transit systems, product enhancements to our transit digital display and related assets, and a gradual increase in transit ridership over the remaining terms of our transit franchise agreements.

Additionally, we are currently no longer assuming that we will exercise the five-year extension to the

Amended Term of the MTA Agreement due to our lowered revenue growth assumptions and currently contractually required increase to the minimum annual guarantee payments to the MTA during the extension period.

Additionally, we are currently no longer assuming that we will exercise the five-year extension to the Amended Term of the MTA Agreement due to our lowered revenue growth assumptions and currently contractually required increase to the minimum annual guarantee payments to the MTA during the extension period.

Other than with respect to the MTA Agreement, we are assuming that we will be able to renew our significant transit franchise agreements.

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Transit and Other reporting unit exceeded its fair value and we recorded an impairment charge of $47.6 million in the Consolidated Statements of Operations, representing the entire goodwill balance associated with the reporting unit.

As of June 30, 2023, the goodwill balances associated with the U.S.

As of September 30, 2023, the goodwill balances associated with the U.S.

Billboard reporting unit was $2,006.4 million and the Canada reporting unit was $22.5 million.

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The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements:

• Consummating the Transaction may be more difficult, costly, or time consuming for the Company and its management than expected and the anticipated benefits of the Transaction may not be fully realized;

• The Transaction parties being unable to satisfy closing conditions, including necessary regulatory approval for the Transaction (or obtaining regulatory approval for the Transaction subject to conditions that are not anticipated), which could delay or cause the parties to abandon or terminate the Transaction;

• Declines in advertising and general economic conditions, including the current heightened levels of inflation;

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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