The ASX has questioned oOh!media over the sudden fall in the outdoor media player's share price.
The shares fell hard last week after oOh!media told the Macquarie conference that the advertising market was “softening”.
The ASX requires listed companies to immediately release any information that a reasonable person would expect to have a material effect on the price or value of shares.
oOh!media shares hit a low of $0.98 on May 3, an almost 40% fall from the prior day’s close of $1.63. Today they are trading at $1.235.
The company told the ASX that it would not normally release monthly revenue results, given the variables that can affect earnings.
"This is especially true at the beginning of the reporting period, noting that oOh’s earnings are traditionally significantly weighted towards the H2 and to Q4 in particular," the company told the ASX.
An investor presentation was released to the market before the Macquarie Australia Conference.
As part of that, the company released April revenue performance.
"Consistent with the approach taken previously, the Company released this information as part of its Investor Presentation given to ASX prior to the conference," oOh!media said.
"oOh! acknowledges the significant decline in the Company’s share price on 3 May 2023 and confirms that it is not aware of any other information that it has not disclosed to the market that could explain the decline."
The trading update:
Outdoor media advertising revenue has been surging since the end of restrictions during the pandemic.
In February oOh!media reported revenue jumping 18% to $592.6 million for the full year to December. Statutory net profit after tax was 400% higher at $31.516 million, compared to $10.28 million loss in 2021. Adjusted net profit after tax was $56.2 million, up 343%.
Analysts described the market reaction as “excessive” and placed the shares at an attractive price.
Brian Han, director at Morningstar, says oOh!media has the balance sheet to weather near-term cyclical headwinds.
“Revenue recovery was never going to be smooth this year, and the prior-year comparisons are especially tough early this year (high-teens growth the first four months of 2022).
“oOh media's 3% revenue growth in the March quarter was below the 12% for the outdoor market."
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