UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2020~~March 31, 2021

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from

Commission File Number: 001-36367

OUTFRONT Media Inc.

(Exact name of registrant as specified in its charter)


Maryland		46-4494703
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

405 Lexington Avenue, 17th Floor
New York,	NY	10174
(Address of principal executive offices)		(Zip Code)

(212) 297-6400

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01, par value	OUT	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ☐ Yes ☒ No

As of ~~November~~May 4, ~~2020,~~2021, the number of shares outstanding of the registrant’s common stock was ~~144,429,154.~~145,539,929.

Table of Contents

OUTFRONT MEDIA INC.

QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED ~~SEPTEMBER 30, 2020~~MARCH 31, 2021

TABLE OF CONTENTS


PART I			3
Item 1. Financial Statements (Unaudited)			3
Consolidated Statements of Financial Position as of S ~~eptember~~ ~~30, 2020,~~March 31, 2021, and December 31, ~~2019~~2020			3
Consolidated Statements of Operations for the three ~~and~~ ~~nine~~months ended ~~September~~ ~~30,~~March 31, 2021 and 2020 ~~and 2019~~			4
Consolidated Statements of Comprehensive Income for the three ~~and~~ ~~nine~~months ended ~~September~~ ~~30,~~March 31, 2021 and 2020 ~~and 2019~~			5
Consolidated Statements of Equity for the three ~~and~~ ~~nine~~months ended ~~September~~ ~~30,~~March 31, 2021 and 2020 ~~and 2019~~			6
Consolidated Statements of Cash Flows for the ~~nine~~three months ended ~~September~~ ~~30,~~ March 31, 2021 and 2020 ~~and 2019~~			87
Notes to Consolidated Financial Statements			109
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			2924
Item 3. Quantitative and Qualitative Disclosures About Market Risk			5345
Item 4. Controls and Procedures			5547
PART II			5648
Item 1. Legal Proceedings			5648
Item 1A. Risk Factors			5648
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			5648
Item 3. Defaults Upon Senior Securities			5648
Item 4. Mine Safety Disclosures			5648
Item 5. Other Information			5648
Item 6. Exhibits			5648
SIGNATURES			5850

Table of Contents

PART I

Item 1. Financial Statements.

OUTFRONT Media Inc.

Consolidated Statements of Financial Position

(Unaudited)


		As of					As of
(in millions)	(in millions)	September 30, 2020		December 31, 2019		(in millions)	March 31, 2021		December 31, 2020
Assets:	Assets:					Assets:
Current assets:	Current assets:					Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	690.6	$	59.1	Cash and cash equivalents	$	560.0	$	710.4
Restricted cash	Restricted cash	1.6		1.8		Restricted cash	1.6		1.6
Receivables, less allowance ($24.8 in 2020 and $12.1 in 2019)		191.4		290.0
Receivables, less allowance ($22.7 in 2021 and $26.3 in 2020)						Receivables, less allowance ($22.7 in 2021 and $26.3 in 2020)	164.9		209.2
Prepaid lease and franchise costs	Prepaid lease and franchise costs	4.7		8.6		Prepaid lease and franchise costs	9.1		5.4
Prepaid MTA equipment deployment costs (Notes 5 and 18)		0		55.4

Other prepaid expenses	Other prepaid expenses	18.4		15.8		Other prepaid expenses	13.9		14.4
Other current assets	Other current assets	31.5		5.1		Other current assets	28.0		33.7
Total current assets	Total current assets	938.2		435.8		Total current assets	777.5		974.7
Property and equipment, net (Note 4)	Property and equipment, net (Note 4)	644.2		666.2		Property and equipment, net (Note 4)	629.2		634.2
Goodwill	Goodwill	2,076.7		2,083.1		Goodwill	2,078.0		2,077.8
Intangible assets (Note 5)	Intangible assets (Note 5)	549.4		550.9		Intangible assets (Note 5)	545.8		547.5
Operating lease assets (Note 6)	Operating lease assets (Note 6)	1,422.2		1,457.0		Operating lease assets (Note 6)	1,437.7		1,421.3
Prepaid MTA equipment deployment costs (Notes 5 and 18)		200.9		116.1
Prepaid MTA equipment deployment costs (Note 18)						Prepaid MTA equipment deployment costs (Note 18)	208.2		204.6
Other assets	Other assets	38.9		73.2		Other assets	37.5		36.8
Total assets	Total assets	$	5,870.5	$	5,382.3	Total assets	$	5,713.9	$	5,896.9

Liabilities:	Liabilities:					Liabilities:
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	51.9	$	67.9	Accounts payable	$	56.8	$	64.9
Accrued compensation	Accrued compensation	25.9		56.1		Accrued compensation	30.9		35.0
Accrued interest	Accrued interest	26.4		26.4		Accrued interest	17.5		24.5
Accrued lease and franchise costs	Accrued lease and franchise costs	54.0		55.3		Accrued lease and franchise costs	39.1		65.8
Other accrued expenses	Other accrued expenses	40.4		34.2		Other accrued expenses	40.0		38.0
Deferred revenues	Deferred revenues	40.6		29.0		Deferred revenues	42.3		29.5

Short-term debt (Note 9)	Short-term debt (Note 9)	80.0		195.0		Short-term debt (Note 9)	0		80.0
Short-term operating lease liabilities (Note 6)	Short-term operating lease liabilities (Note 6)	182.8		168.3		Short-term operating lease liabilities (Note 6)	185.7		176.5
Other current liabilities	Other current liabilities	25.0		17.8		Other current liabilities	20.4		20.7
Total current liabilities	Total current liabilities	527.0		650.0		Total current liabilities	432.7		534.9
Long-term debt, net (Note 9)	Long-term debt, net (Note 9)	2,619.6		2,222.1		Long-term debt, net (Note 9)	2,616.6		2,620.8
Deferred income tax liabilities, net	Deferred income tax liabilities, net	14.6		18.0		Deferred income tax liabilities, net	13.2		14.6
Asset retirement obligation (Note 7)	Asset retirement obligation (Note 7)	35.4		35.1		Asset retirement obligation (Note 7)	36.1		35.9
Operating lease liabilities (Note 6)	Operating lease liabilities (Note 6)	1,248.0		1,285.1		Operating lease liabilities (Note 6)	1,258.4		1,252.0
Other liabilities	Other liabilities	50.5		45.6		Other liabilities	52.7		55.0
Total liabilities	Total liabilities	4,495.1		4,255.9		Total liabilities	4,409.7		4,513.2

Commitments and contingencies (Note 18)	Commitments and contingencies (Note 18)					Commitments and contingencies (Note 18)	0		0

Preferred stock (2020 - 50.0 shares authorized, and 0.4 shares of Series A Preferred Stock issued and outstanding; 2019 - 50.0 shares authorized, and 0 shares issued and outstanding) (Note 10)		383.4		0
Preferred stock (2021 - 50.0 shares authorized, and 0.4 shares of Series A Preferred Stock issued and outstanding; 2020 - 50.0 shares authorized, and 0.4 shares of Series A Preferred Stock issued and outstanding) (Note 10)						Preferred stock (2021 - 50.0 shares authorized, and 0.4 shares of Series A Preferred Stock issued and outstanding; 2020 - 50.0 shares authorized, and 0.4 shares of Series A Preferred Stock issued and outstanding) (Note 10)	383.4		383.4
Stockholders’ equity (Note 10):	Stockholders’ equity (Note 10):					Stockholders’ equity (Note 10):
Common stock (2020 - 450.0 shares authorized, and 144.4 shares issued and outstanding; 2019 - 450.0 shares authorized, and 143.6 issued and outstanding)		1.4		1.4
Common stock (2021 - 450.0 shares authorized, and 145.5 shares issued and outstanding; 2020 - 450.0 shares authorized, and 144.5 issued and outstanding)						Common stock (2021 - 450.0 shares authorized, and 145.5 shares issued and outstanding; 2020 - 450.0 shares authorized, and 144.5 issued and outstanding)	1.5		1.4
Additional paid-in capital	Additional paid-in capital	2,084.0		2,074.7		Additional paid-in capital	2,095.5		2,090.8
Distribution in excess of earnings	Distribution in excess of earnings	(1,097.7)		(964.6)		Distribution in excess of earnings	(1,175.1)		(1,100.4)
Accumulated other comprehensive loss	Accumulated other comprehensive loss	(23.1)		(17.7)		Accumulated other comprehensive loss	(15.5)		(18.0)
Total stockholders’ equity	Total stockholders’ equity	964.6		1,093.8		Total stockholders’ equity	906.4		973.8
Non-controlling interests	Non-controlling interests	27.4		32.6		Non-controlling interests	14.4		26.5
Total equity	Total equity	1,375.4		1,126.4		Total equity	1,304.2		1,383.7
Total liabilities and equity	Total liabilities and equity	$	5,870.5	$	5,382.3	Total liabilities and equity	$	5,713.9	$	5,896.9

See accompanying notes to unaudited consolidated financial statements.

Table of Contents

OUTFRONT Media Inc.

Consolidated Statements of Operations

(Unaudited)


		Three Months Ended				Nine Months Ended					Three Months Ended
		September 30,				September 30,					March 31,
(in millions, except per share amounts)	(in millions, except per share amounts)	2020		2019		2020		2019		(in millions, except per share amounts)		2021		2020
Revenues:	Revenues:									Revenues:
Billboard	Billboard	$	239.9	$	312.0	$	699.3	$	868.8	Billboard		$	223.6	$	270.9
Transit and other	Transit and other	42.4		150.5		201.2		425.3		Transit and other		35.6		114.4
Total revenues	Total revenues	282.3		462.5		900.5		1,294.1		Total revenues		259.2		385.3
Expenses:	Expenses:									Expenses:
Operating	Operating	155.8		245.5		534.6		702.7		Operating		177.6		224.8
Selling, general and administrative	Selling, general and administrative	63.4		82.3		205.3		237.1		Selling, general and administrative		76.5		90.8
Restructuring charges		0.6		0		5.3		0.3

Net gain on dispositions	Net gain on dispositions	(8.0)		(1.9)		(13.3)		(3.0)		Net gain on dispositions		(0.3)		(0.1)
Depreciation	Depreciation	21.0		22.4		63.2		64.9		Depreciation		20.0		21.0
Amortization	Amortization	24.4		28.7		72.4		81.0		Amortization		16.4		15.0
Total expenses	Total expenses	257.2		377.0		867.5		1,083.0		Total expenses		290.2		351.5
Operating income		25.1		85.5		33.0		211.1
Operating income (loss)										Operating income (loss)		(31.0)		33.8
Interest expense, net	Interest expense, net	(34.2)		(33.9)		(97.3)		(100.5)		Interest expense, net		(34.6)		(29.8)
Loss on extinguishment of debt	Loss on extinguishment of debt	0		(11.0)		0		(11.0)		Loss on extinguishment of debt		(6.3)		0
Other income (expense), net		(0.1)		0		0.1		0.1
Income (loss) before benefit (provision) for income taxes and equity in earnings of investee companies		(9.2)		40.6		(64.2)		99.7
Provision for income taxes		(3.5)		(3.3)		(0.3)		(8.5)
Other income, net										Other income, net		0		0.2
Income (loss) before benefit for income taxes and equity in earnings of investee companies										Income (loss) before benefit for income taxes and equity in earnings of investee companies		(71.9)		4.2
Benefit for income taxes										Benefit for income taxes		4.7		1.7
Equity in earnings of investee companies, net of tax	Equity in earnings of investee companies, net of tax	(0.6)		1.4		(0.5)		3.9		Equity in earnings of investee companies, net of tax		(0.4)		0.4
Net income (loss) before allocation to non-controlling interests	Net income (loss) before allocation to non-controlling interests	(13.3)		38.7		(65.0)		95.1		Net income (loss) before allocation to non-controlling interests		(67.6)		6.3
Net income attributable to non-controlling interests	Net income attributable to non-controlling interests	0.2		0		0.3		0		Net income attributable to non-controlling interests		0.1		0.2
Net income (loss) attributable to OUTFRONT Media Inc.	Net income (loss) attributable to OUTFRONT Media Inc.	$	(13.5)	$	38.7	$	(65.3)	$	95.1	Net income (loss) attributable to OUTFRONT Media Inc.		$	(67.7)	$	6.1

Net income (loss) per common share:	Net income (loss) per common share:									Net income (loss) per common share:
Basic	Basic	$	(0.14)	$	0.27	$	(0.54)	$	0.66	Basic		$	(0.52)	$	0.04
Diluted	Diluted	$	(0.14)	$	0.27	$	(0.54)	$	0.66	Diluted		$	(0.52)	$	0.04

Weighted average shares outstanding:	Weighted average shares outstanding:									Weighted average shares outstanding:
Basic	Basic	144.4		143.4		144.2		142.1		Basic		144.8		143.9
Diluted	Diluted	144.4		144.2		144.2		142.7		Diluted		144.8		144.7

See accompanying notes to unaudited consolidated financial statements.

Table of Contents

OUTFRONT Media Inc.

Consolidated Statements of Comprehensive ~~Income (Loss)~~Loss

(Unaudited)


		Three Months Ended				Nine Months Ended					Three Months Ended
		September 30,				September 30,					March 31,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)		2021		2020
Net income (loss) before allocation to non-controlling interests	Net income (loss) before allocation to non-controlling interests	$	(13.3)	$	38.7	$	(65.0)	$	95.1	Net income (loss) before allocation to non-controlling interests		$	(67.6)	$	6.3
Net income attributable to non-controlling interests	Net income attributable to non-controlling interests	0.2		0		0.3		0		Net income attributable to non-controlling interests		0.1		0.2
Net income (loss) attributable to OUTFRONT Media Inc.	Net income (loss) attributable to OUTFRONT Media Inc.	(13.5)		38.7		(65.3)		95.1		Net income (loss) attributable to OUTFRONT Media Inc.		(67.7)		6.1
Other comprehensive income (loss), net of tax:
Other comprehensive loss, net of tax:										Other comprehensive loss, net of tax:
Cumulative translation adjustments	Cumulative translation adjustments	2.6		(0.8)		(3.5)		6.4		Cumulative translation adjustments		1.3		(10.5)
Net actuarial gain (loss)		(0.1)		0.2		0.4		0.1
Net actuarial gain										Net actuarial gain		0		0.7
Change in fair value of interest rate swap agreements	Change in fair value of interest rate swap agreements	1.3		(0.4)		(2.3)		(3.2)		Change in fair value of interest rate swap agreements		1.2		(4.3)
Total other comprehensive income (loss), net of tax		3.8		(1.0)		(5.4)		3.3
Total comprehensive income (loss)		$	(9.7)	$	37.7	$	(70.7)	$	98.4
Total other comprehensive loss, net of tax										Total other comprehensive loss, net of tax		2.5		(14.1)
Total comprehensive loss										Total comprehensive loss		$	(65.2)	$	(8.0)

See accompanying notes to unaudited consolidated financial statements.

Table of Contents

OUTFRONT Media Inc.

Consolidated Statements of Equity

(Unaudited)

Stockholders’ Equity
(in millions, except per share amounts) Shares of Series A Preferred Stock Series A Preferred Stock ($0.01 per share par value) Shares of Common Stock Common Stock ($0.01 per share par value) Additional Paid-In Capital Distribution in Excess of Earnings Accumulated Other Comprehensive Loss Total Stockholders’ Equity Non-Controlling Interests Total Equity
Balance as of
June 30, 2019 143.3 $ 1.4 $ 2,057.9 $ (943.9) $ (17.7) $ 1,097.7 $ 37.2 $ 1,134.9
Net income — — — 38.7 — 38.7 — 38.7
Other comprehensive loss — — — — (1.0) (1.0) — (1.0)
Stock-based payments:
Amortization — — 5.6 — — 5.6 — 5.6
Class A equity interest redemptions 0.2 — 4.1 — — 4.1 (4.1) —
Dividends ($0.36 per share) — — — (52.1) — (52.1) — (52.1)
Other — — — — — — 0.1 0.1
Balance as of
September 30, 2019 143.5 $ 1.4 $ 2,067.6 $ (957.3) $ (18.7) $ 1,093.0 $ 33.2 $ 1,126.2
Balance as of
June 30, 2020 0.4 $ 383.4 144.4 $ 1.4 $ 2,078.8 $ (1,077.2) $ (26.9) $ 976.1 $ 27.2 $ 1,386.7
Net income (loss) — — — — — (13.5) — (13.5) 0.2 (13.3)
Other comprehensive income — — — — — — 3.8 3.8 — 3.8
Stock-based payments:
Amortization — — — — 5.4 — — 5.4 — 5.4
Shares paid for tax withholding for stock-based payments — — — — (0.2) — — (0.2) — (0.2)
Series A Preferred Stock dividends (7%) — — — — — (7.0) — (7.0) — (7.0)
Balance as of
September 30, 2020 0.4 $ 383.4 144.4 $ 1.4 $ 2,084.0 $ (1,097.7) $ (23.1) $ 964.6 $ 27.4 $ 1,375.4


	Stockholders’ Equity
(in millions, except per share amounts)	Shares of Common Stock	Common Stock ($0.01 per share par value)		Additional Paid-In Capital		Distribution in Excess of Earnings		Accumulated Other Comprehensive Loss		Total Stockholders’ Equity		Non-Controlling Interests		Total Equity
Balance as of December 31, 2019	143.6	$	1.4	$	2,074.7	$	(964.6)	$	(17.7)	$	1,093.8	$	32.6	$	1,126.4
Net income	—	—		—		6.1		—		6.1		0.2		6.3
Other comprehensive loss	—	—		—		—		(14.1)		(14.1)		—		(14.1)
Stock-based payments:
Vested	1.0	—		—		—		—		—		—		—
Amortization	—	—		5.8		—		—		5.8		—		5.8
Shares paid for tax withholding for stock-based payments	(0.4)	—		(12.1)		—		—		(12.1)		—		(12.1)
Class A equity interest redemptions	0.2	—		4.4		—		—		4.4		(4.4)		—

Dividends ($0.38 per share)	—	—		—		(55.3)		—		(55.3)		—		(55.3)

Balance as of March 31, 2020	144.4	$	1.4	$	2,072.8	$	(1,013.8)	$	(31.8)	$	1,028.6	$	28.4	$	1,057.0

~~Table of Contents~~

~~OUTFRONT Media Inc.~~

~~Consolidated Statements of Equity (Continued)~~

~~(Unaudited)~~

Stockholders’ Equity
(in millions, except per share amounts) Shares of Common Stock Common Stock ($0.01 per share par value) Additional Paid-In Capital Distribution in Excess of Earnings Accumulated Other Comprehensive Loss Total Stockholders’ Equity Non-Controlling Interests Total Equity
Balance as of December 31, 2018 140.2 $ 1.4 $ 1,995.0 $ (871.6) $ (22.0) $ 1,102.8 $ 42.5 $ 1,145.3
Cumulative effect of a new accounting standard — — — (24.8) — (24.8) — (24.8)
Net income — — — 95.1 — 95.1 — 95.1
Other comprehensive income — — — — 3.3 3.3 — 3.3
Stock-based payments:
Vested 0.9 — — — — — — —
Amortization — — 16.4 — — 16.4 — 16.4
Shares paid for tax withholding for stock-based payments (0.4) — (7.7) — — (7.7) — (7.7)
Class A equity interest redemptions 0.6 — 13.0 — — 13.0 (13.0) —
Shares issued under the ATM Program 2.2 — 50.8 — — 50.8 — 50.8
Dividends ($1.08 per share) — — — (156.0) — (156.0) — (156.0)
Other — — 0.1 — — 0.1 3.7 3.8
Balance as of September 30, 2019 143.5 $ 1.4 $ 2,067.6 $ (957.3) $ (18.7) $ 1,093.0 $ 33.2 $ 1,126.2


					Stockholders’ Equity																			Stockholders’ Equity
(in millions, except per share amounts)	(in millions, except per share amounts)	Shares of Series A Preferred Stock	Series A Preferred Stock ($0.01 per share par value)		Shares of Common Stock	Common Stock ($0.01 per share par value)		Additional Paid-In Capital		Distribution in Excess of Earnings		Accumulated Other Comprehensive Loss		Total Stockholders’ Equity		Non-Controlling Interests		Total Equity		(in millions, except per share amounts)	Shares of Series A Preferred Stock	Series A Preferred Stock ($0.01 per share par value)		Shares of Common Stock	Common Stock ($0.01 per share par value)		Additional Paid-In Capital		Distribution in Excess of Earnings		Accumulated Other Comprehensive Loss		Total Stockholders’ Equity		Non-Controlling Interests		Total Equity
Balance as of December 31, 2019		0	$	0	143.6	$	1.4	$	2,074.7	$	(964.6)	$	(17.7)	$	1,093.8	$	32.6	$	1,126.4
Net income (loss)		—	—		—	—		—		(65.3)		—		(65.3)		0.3		(65.0)
Balance as of December 31, 2020																				Balance as of December 31, 2020	0.4	$	383.4	144.5	$	1.4	$	2,090.8	$	(1,100.4)	$	(18.0)	$	973.8	$	26.5	$	1,383.7
Net loss																				Net loss	—	—		—	—		—		(67.7)		—		(67.7)		0.1		(67.6)
Other comprehensive loss	Other comprehensive loss	—	—		—	—		—		—		(5.4)		(5.4)		—		(5.4)		Other comprehensive loss	—	—		—	—		—		—		2.5		2.5		—		2.5
Stock-based payments:	Stock-based payments:																			Stock-based payments:
Vested	Vested	—	—		1.0	—		—		—		—		—		—		—		Vested	—	—		1.0	0.1		—		—		—		0.1		—		0.1
Amortization	Amortization	—	—		—	—		17.3		—		—		17.3		—		17.3		Amortization	—	—		—	—		6.0		—		—		6.0		—		6.0
Shares paid for tax withholding for stock-based payments	Shares paid for tax withholding for stock-based payments	—	—		(0.4)	—		(12.4)		—		—		(12.4)		—		(12.4)		Shares paid for tax withholding for stock-based payments	—	—		(0.5)	—		(8.7)		—		—		(8.7)		—		(8.7)
New share issues		0.4	383.4		—	—		—		—		—		—		—		383.4

Class A equity interest redemptions	Class A equity interest redemptions	—	—		0.2	—		4.4		—		—		4.4		(4.4)		—		Class A equity interest redemptions	—	—		0.5	—		10.7		—		—		10.7		(10.7)		—
Series A Preferred Stock dividends (7%)	Series A Preferred Stock dividends (7%)	—	—		—	—		—		(12.5)		—		(12.5)		—		(12.5)		Series A Preferred Stock dividends (7%)	—	—		—	—		—		(7.0)		—		(7.0)		—		(7.0)
Dividends ($0.38 per share)		—	—		—	—		—		(55.3)		—		(55.3)		—		(55.3)

Other	Other	—	—		—	—		—		—		—		—		(1.1)		(1.1)		Other	—	—		—	—		(3.3)		—		—		(3.3)		(1.5)		(4.8)
Balance as of September 30, 2020		0.4	$	383.4	144.4	$	1.4	$	2,084.0	$	(1,097.7)	$	(23.1)	$	964.6	$	27.4	$	1,375.4
Balance as of March 31, 2021																				Balance as of March 31, 2021	0.4	$	383.4	145.5	$	1.5	$	2,095.5	$	(1,175.1)	$	(15.5)	$	906.4	$	14.4	$	1,304.2

See accompanying notes to unaudited consolidated financial statements.

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OUTFRONT Media Inc.

Consolidated Statements of Cash Flows

(Unaudited)


		Nine Months Ended					Three Months Ended
		September 30,					March 31,
(in millions)	(in millions)	2020		2019		(in millions)	2021		2020
Operating activities:	Operating activities:					Operating activities:
Net income (loss) attributable to OUTFRONT Media Inc.	Net income (loss) attributable to OUTFRONT Media Inc.	$	(65.3)	$	95.1	Net income (loss) attributable to OUTFRONT Media Inc.	$	(67.7)	$	6.1
Adjustments to reconcile net income to net cash flow provided by operating activities:
Adjustments to reconcile net income (loss) to net cash flow provided by (used for) operating activities:						Adjustments to reconcile net income (loss) to net cash flow provided by (used for) operating activities:
Net income attributable to non-controlling interests	Net income attributable to non-controlling interests	0.3		0		Net income attributable to non-controlling interests	0.1		0.2
Depreciation and amortization	Depreciation and amortization	135.6		145.9		Depreciation and amortization	36.4		36.0
Deferred tax (benefit) provision		(3.8)		1.2
Deferred tax benefit						Deferred tax benefit	(5.2)		(1.8)
Stock-based compensation	Stock-based compensation	17.3		16.4		Stock-based compensation	6.0		5.8
Provision for doubtful accounts	Provision for doubtful accounts	17.4		4.0		Provision for doubtful accounts	(2.8)		8.1
Accretion expense	Accretion expense	1.9		1.9		Accretion expense	0.7		0.6
Net gain on dispositions	Net gain on dispositions	(13.3)		(3.0)		Net gain on dispositions	(0.3)		(0.1)
Loss on extinguishment of debt	Loss on extinguishment of debt	0		11.0		Loss on extinguishment of debt	6.3		0
Equity in earnings of investee companies, net of tax	Equity in earnings of investee companies, net of tax	0.5		(3.9)		Equity in earnings of investee companies, net of tax	0.4		(0.4)
Distributions from investee companies	Distributions from investee companies	2.1		3.1		Distributions from investee companies	0.3		1.2
Amortization of deferred financing costs and debt discount and premium	Amortization of deferred financing costs and debt discount and premium	4.8		4.9		Amortization of deferred financing costs and debt discount and premium	1.9		1.3
Cash paid for direct lease acquisition costs		(32.6)		(34.5)
Change in assets and liabilities, net of investing and financing activities:	Change in assets and liabilities, net of investing and financing activities:					Change in assets and liabilities, net of investing and financing activities:
(Increase) decrease in receivables		80.5		(29.2)
Decrease in receivables						Decrease in receivables	47.2		19.7
Increase in prepaid MTA equipment deployment costs	Increase in prepaid MTA equipment deployment costs	(29.4)		(64.2)		Increase in prepaid MTA equipment deployment costs	(3.6)		(18.2)
Increase in prepaid expenses and other current assets		(25.0)		(10.4)
Increase (decrease) in accounts payable and accrued expenses		(36.5)		3.0
(Increase) decrease in prepaid expenses and other current assets						(Increase) decrease in prepaid expenses and other current assets	1.2		(2.8)
Decrease in accounts payable and accrued expenses						Decrease in accounts payable and accrued expenses	(46.1)		(46.0)
Increase in operating lease assets and liabilities	Increase in operating lease assets and liabilities	13.4		9.7		Increase in operating lease assets and liabilities	0.4		1.3
Increase in deferred revenues	Increase in deferred revenues	12.1		9.1		Increase in deferred revenues	12.8		11.1
Increase (decrease) in income taxes		1.0		(0.5)
Decrease in income taxes						Decrease in income taxes	(0.1)		(0.7)
Other, net	Other, net	5.0		2.5		Other, net	1.3		(6.5)
Net cash flow provided by operating activities		86.0		162.1
Net cash flow provided by (used for) operating activities						Net cash flow provided by (used for) operating activities	(10.8)		14.9

Investing activities:	Investing activities:					Investing activities:
Capital expenditures	Capital expenditures	(42.0)		(65.4)		Capital expenditures	(9.4)		(18.2)
Acquisitions	Acquisitions	(15.5)		(60.7)		Acquisitions	(15.8)		(6.6)
MTA franchise rights	MTA franchise rights	(14.4)		(16.9)		MTA franchise rights	(4.2)		(2.8)
Net proceeds from dispositions	Net proceeds from dispositions	35.9		4.9		Net proceeds from dispositions	1.1		0.3
Return of investment in investee companies	Return of investment in investee companies	0.9		0		Return of investment in investee companies	0		0.6
Net cash flow used for investing activities	Net cash flow used for investing activities	(35.1)		(138.1)		Net cash flow used for investing activities	(28.3)		(26.7)

Financing activities:	Financing activities:					Financing activities:
Proceeds from long-term debt borrowings	Proceeds from long-term debt borrowings	895.0		760.0		Proceeds from long-term debt borrowings	500.0		495.0
Repayments of long-term debt borrowings	Repayments of long-term debt borrowings	(495.0)		(695.0)		Repayments of long-term debt borrowings	(500.0)		0
Proceeds from borrowings under short-term debt facilities	Proceeds from borrowings under short-term debt facilities	15.0		280.0		Proceeds from borrowings under short-term debt facilities	0		15.0
Repayments of borrowings under short-term debt facilities	Repayments of borrowings under short-term debt facilities	(130.0)		(230.0)		Repayments of borrowings under short-term debt facilities	(80.0)		0
Payments of deferred financing costs	Payments of deferred financing costs	(7.7)		(9.5)		Payments of deferred financing costs	(7.1)		(0.4)
Payments of debt extinguishment charges	Payments of debt extinguishment charges	0		(7.4)		Payments of debt extinguishment charges	(4.7)		0
Proceeds from Series A Preferred Stock issuances		383.8		0
Proceeds from shares issued under the ATM Program		0		50.9

Taxes withheld for stock-based compensation	Taxes withheld for stock-based compensation	(12.0)		(7.7)		Taxes withheld for stock-based compensation	(8.8)		(11.8)
Dividends	Dividends	(68.1)		(156.0)		Dividends	(7.3)		(55.6)

Other						Other	(3.7)		0
Net cash flow provided by (used for) financing activities	Net cash flow provided by (used for) financing activities	581.0		(14.7)		Net cash flow provided by (used for) financing activities	(111.6)		442.2

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OUTFRONT Media Inc.

Consolidated Statements of Cash Flows (Continued)

(Unaudited)


		Nine Months Ended					Three Months Ended
		September 30,					March 31,
(in millions)	(in millions)	2020		2019		(in millions)	2021		2020
Effect of exchange rate changes on cash, cash equivalents and restricted cash	Effect of exchange rate changes on cash, cash equivalents and restricted cash	(0.6)		0.3		Effect of exchange rate changes on cash, cash equivalents and restricted cash	0.3		(1.7)
Net increase in cash, cash equivalents and restricted cash		631.3		9.6
Net increase (decrease) in cash, cash equivalents and restricted cash						Net increase (decrease) in cash, cash equivalents and restricted cash	(150.4)		428.7
Cash, cash equivalents and restricted cash at beginning of period	Cash, cash equivalents and restricted cash at beginning of period	60.9		54.1		Cash, cash equivalents and restricted cash at beginning of period	712.0		60.9
Cash, cash equivalents and restricted cash at end of period	Cash, cash equivalents and restricted cash at end of period	$	692.2	$	63.7	Cash, cash equivalents and restricted cash at end of period	$	561.6	$	489.6

Supplemental disclosure of cash flow information:	Supplemental disclosure of cash flow information:					Supplemental disclosure of cash flow information:
Cash paid for income taxes	Cash paid for income taxes	$	3.1	$	7.9	Cash paid for income taxes	$	0.5	$	0.8
Cash paid for interest	Cash paid for interest	93.5		92.3		Cash paid for interest	39.9		37.5

Non-cash investing and financing activities:	Non-cash investing and financing activities:					Non-cash investing and financing activities:
Accrued purchases of property and equipment	Accrued purchases of property and equipment	$	5.3	$	10.9	Accrued purchases of property and equipment	$	3.8	$	9.7
Accrued MTA franchise rights	Accrued MTA franchise rights	5.2		2.3		Accrued MTA franchise rights	7.0		5.0

Taxes withheld for stock-based compensation	Taxes withheld for stock-based compensation	0.3		0		Taxes withheld for stock-based compensation	0		0.2

See accompanying notes to unaudited consolidated financial statements.

Table of Contents

OUTFRONT Media Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Note 1. Description of Business and Basis of Presentation

Description of Business

OUTFRONT Media Inc. (the “Company”) and its subsidiaries (collectively, “we,” “us” or “our”) is a real estate investment trust (“REIT”), which provides advertising space (“displays”) on out-of-home advertising structures and sites in the United States (the “U.S.”) and Canada. Our inventory consists of billboard displays, which are primarily located on the most heavily traveled highways and roadways in top Nielsen Designated Market Areas (“DMAs”), and transit advertising displays operated under exclusive multi-year contracts with municipalities in large cities across the U.S. and Canada. In total, we have displays in all of the 25 largest markets in the U.S. and approximately 150 markets across the U.S. and Canada. We currently manage our operations through 2 operating segments—U.S. Billboard and Transit, which is included in our U.S. Media reportable segment, and International.

In the third quarter of 2020, we sold all of our equity interests in certain of our subsidiaries (the “Sports Disposition”), which held all of the assets of our Sports Marketing operating segment, for a purchase price of approximately $34.6 million in cash, subject to closing and post-closing ~~adjustments (see Note 13.~~ ~~Acquisitions and Dispositions~~: ~~Dispositions~~ ~~to the Consolidated Financial Statements).~~adjustments. The Sports Marketing operating segment was the marketing and multimedia rights holder for a variety of colleges, universities and other educational institutions across the United States. The operating results of our Sports Marketing operating segment through June 30, 2020, are included in our Consolidated Financial Statements.

Basis of Presentation and Use of Estimates

The accompanying unaudited consolidated financial statements have been prepared pursuant to the rules of the Securities and Exchange Commission (the “SEC”). In the opinion of our management, the accompanying unaudited consolidated financial statements reflect all adjustments, consisting of normal and recurring adjustments, necessary for a fair statement of our financial position, results of operations and cash flows for the periods presented. Certain reclassifications of prior year’s data have been made to conform to the current period’s presentation. Consistent with 2021, amortization of direct lease acquisition costs previously reported in Amortization have been reclassified to conform with the current period’s presentation. The impact of the reclassification is a decrease in Amortization of $11.3 million in the three months ended March 31, 2020, and a corresponding increase in Selling, general and administrative expenses (“SG&A”) on the Consolidated Statement of Operations. These financial statements should be read in conjunction with the more detailed financial statements and notes thereto, included in our Annual Report on Form 10-K for the year ended December 31, ~~2019,~~2020, filed with the SEC on February 26, ~~2020.~~2021.

The preparation of our financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities ~~as of~~at the date of the financial statements, and the reported amount of revenues and expenses during the reporting period. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, including the impact of extraordinary events such as the novel coronavirus ~~(COVID-19)~~(“COVID-19”) pandemic, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions, including the severity and duration of the COVID-19 pandemic.

The COVID-19 pandemic and the related preventative measures taken to help curb the spread, have had, and may continue to have, a significant impact on the global economy and our business. In order to preserve financial flexibility and increase liquidity in light of the current uncertainty in the global economy and our business resulting from the COVID-19 pandemic, we undertook the following actions, among others: repaid in full all borrowings under the Revolving Credit Facility (as defined below) as of June 30, 2020, using the net proceeds from the offering of the Notes (as defined below) and cash on hand, and amended the Credit Agreement (as defined below) to modify the calculation of the Company’s financial maintenance covenant ratio (see Note 9. ~~Debt~~ ~~to the Consolidated Financial Statements), completed the Private Placement (as defined below) (see Note 10.~~ ~~Equity~~ ~~to the Consolidated Financial Statements) and reduced capital expenditures and expenses through cost savings initiatives.~~ Given the uncertainty around the severity and duration of the COVID-19 pandemic and the measures taken, or may be taken, in response to the COVID-19 pandemic, the Company cannot reasonably estimate the full impact of the COVID-19 pandemic on our business, financial condition and results of operations at this time, which may be material.

~~Table of Contents~~

~~OUTFRONT Media Inc.~~

~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~

Note 2. New Accounting Standards

Adoption of New Accounting Standards

In the first quarter of ~~2020,~~2021, we adopted the Financial Accounting Standards Board’s (the “FASB’s”) guidance for evaluating and determining when a cloud computing arrangement (hosting arrangement) includes a software license. The adoption of this guidance did not have a material effect on our consolidated financial statements.

In the first quarter of 2020, we adopted the FASB’s guidance which requires a reporting entity to estimate credit losses on certain types of financial instruments, and present assets held at amortized cost and available-for-sale debt securities at the amount expected to be collected. The application of this guidance was limited to our receivables that are not related to rental income, which is accounted for under the lease accounting standard. The provision for doubtful accounts is estimated based on historical bad debt experience, the aging of accounts receivable, industry trends and economic indicators, recent payment history for specific customers and expected future trends.

~~We have recorded a~~ ~~Provision for doubtful accounts~~ of $6.1 million in the three months ended September 30, 2020, and $17.4 million in the nine months ended September 30, 2020, for all receivables, which includes an estimate of the impact from the COVID-19 pandemic on future collections.

~~Recent Pronouncements~~

~~In December 2019, the FASB issued guidance~~ simplifying the accounting for income taxes by removing certain exceptions to the general principles of Accounting Standards Codification Topic 740, Income Taxes. The ~~new guidance is effective for annual and interim periods beginning after December 15, 2020. We do not expect~~adoption of this guidance todid not have a material effect on our consolidated financial statements.

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OUTFRONT Media Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Recent Pronouncements

In March 2020, the FASB issued guidance providing optional expedients and exceptions for accounting for contracts, hedging relationships and other transactions that reference to ~~LIBOR~~the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform, if certain criteria are met. The guidance is effective for all entities as of March 12, 2020, through December 31, 2022. We do not expect this guidance to impact our accounting for our existing debt and hedging instruments.

Note 3. Restricted Cash

We have an escrow agreement in connection with one of our transit franchise contracts, which requires us to deposit funds into an escrow account to fund capital expenditures over the term of the transit franchise contract. As of ~~September 30, 2020,~~March 31, 2021, we have $1.6 million of restricted cash deposited in the escrow account.


		As of							As of
(in millions)	(in millions)	September 30, 2020		September 30, 2019		December 31, 2019		(in millions)	March 31, 2021		March 31, 2020		December 31, 2020
Cash and cash equivalents	Cash and cash equivalents	$	690.6	$	58.3	$	59.1	Cash and cash equivalents	$	560.0	$	487.8	$	710.4
Restricted cash	Restricted cash	1.6		5.4		1.8		Restricted cash	1.6		1.8		1.6
Cash, cash equivalents and restricted cash	Cash, cash equivalents and restricted cash	$	692.2	$	63.7	$	60.9	Cash, cash equivalents and restricted cash	$	561.6	$	489.6	$	712.0

~~Table of Contents~~

~~OUTFRONT Media Inc.~~

~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~

Note 4. Property and Equipment, Net

The table below presents the balances of major classes of assets and accumulated depreciation.


			As of						As of
(in millions)	(in millions)	Estimated Useful Lives	September 30, 2020		December 31, 2019		(in millions)	Estimated Useful Lives	March 31, 2021		December 31, 2020
Land	Land		$	98.0	$	98.8	Land		$	102.6	$	98.0
Buildings	Buildings	20 to 40 years	47.6		50.4		Buildings	20 to 40 years	48.6		48.3
Advertising structures	Advertising structures	5 to 20 years	1,874.8		1,866.1		Advertising structures	5 to 20 years	1,908.3		1,897.7
Furniture, equipment and other	Furniture, equipment and other	3 to 10 years	164.0		153.1		Furniture, equipment and other	3 to 10 years	170.7		168.5
Construction in progress	Construction in progress		27.0		25.4		Construction in progress		24.1		25.1
			2,211.4		2,193.8				2,254.3		2,237.6
Less: Accumulated depreciation	Less: Accumulated depreciation		1,567.2		1,527.6		Less: Accumulated depreciation		1,625.1		1,603.4
Property and equipment, net	Property and equipment, net		$	644.2	$	666.2	Property and equipment, net		$	629.2	$	634.2

Depreciation expense was $20.0 million in the three months ended March 31, 2021, and $21.0 million in the three months ended September 30, 2020, $22.4 million in the three months ended September 30, 2019, $63.2 million in the nine months ended September 30, 2020, and $64.9 million in the nine months ended September 30, 2019.March 31, 2020.

Note 5. ~~Long-Lived Assets~~

The assumptions and estimates used in our analyses below require significant judgment about future events, market conditions and financial performance. Given the uncertainty around the severity and duration of the COVID-19 pandemic and the measures taken, or may be taken, in response to the COVID-19 pandemic, actual results may differ materially from these assumptions and estimates, which may result in impairment charges of our long-lived assets in the future.

~~Goodwill~~

In the first quarter of 2020, we performed a qualitative assessment to determine if there has been a triggering event and impairment of goodwill as a result of the COVID-19 pandemic. As a result of the analysis performed, we determined that it was not “more likely than not” that the carrying value of any of our reporting units exceeded their fair value and no further evaluation of goodwill was necessary. We did not identify a triggering event in the second and third quarters of 2020.

Intangible Assets

Our identifiable intangible assets primarily consist of acquired permits and leasehold agreements, and franchise agreements, which grant us the right to operate out-of-home structures in specified locations and the right to provide advertising space on railroad and municipal transit properties. Identifiable intangible assets are amortized on a straight-line basis over their estimated useful life, which is the respective life of the agreement that in some cases includes historical experience of renewals.

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OUTFRONT Media Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Our identifiable intangible assets consist of the following:


(in millions)	(in millions)	Gross		Accumulated Amortization		Net		(in millions)	Gross		Accumulated Amortization		Net
As of September 30, 2020:
As of March 31, 2021:								As of March 31, 2021:
Permits and leasehold agreements	Permits and leasehold agreements	$	1,186.0	$	(765.7)	$	420.3	Permits and leasehold agreements	$	1,200.4	$	(787.9)	$	412.5
Franchise agreements	Franchise agreements	504.3		(379.5)		124.8		Franchise agreements	519.1		(388.6)		130.5
Other intangible assets	Other intangible assets	45.6		(41.3)		4.3		Other intangible assets	22.1		(19.3)		2.8
Total intangible assets	Total intangible assets	$	1,735.9	$	(1,186.5)	$	549.4	Total intangible assets	$	1,741.6	$	(1,195.8)	$	545.8

As of December 31, 2019:
As of December 31, 2020:								As of December 31, 2020:
Permits and leasehold agreements	Permits and leasehold agreements	$	1,153.3	$	(735.7)	$	417.6	Permits and leasehold agreements	$	1,190.0	$	(777.1)	$	412.9
Franchise agreements	Franchise agreements	497.4		(371.1)		126.3		Franchise agreements	514.7		(383.7)		131.0
Other intangible assets	Other intangible assets	47.1		(40.1)		7.0		Other intangible assets	45.8		(42.2)		3.6
Total intangible assets	Total intangible assets	$	1,697.8	$	(1,146.9)	$	550.9	Total intangible assets	$	1,750.5	$	(1,203.0)	$	547.5

All of our intangible assets, except goodwill, are subject to amortization. Amortization expense was ~~$24.4~~$16.4 million in the three months ended ~~September 30, 2020,~~March 31, 2021, and ~~$28.7~~$15.0 million in the three months ended September 30, 2019, which includes the amortization of direct lease acquisition costs of $9.1 million in the three months ended September 30, 2020, and $13.6 million in the three months ended September 30, 2019. Amortization expense was $72.4 million in the nine months ended September 30, 2020, and $81.0 million in the nine months ended September 30, 2019, which includes the amortization of direct lease acquisition costs of $26.7 million in the nine months ended September 30, 2020, and $36.9 million in the nine months ended September 30, 2019. Direct lease acquisition costs are amortized on a straight-line basis over the related customer lease term, which generally ranges from four weeks to one year.

~~New York Metropolitan Transportation Authority (the “MTA”) Agreement~~

~~In the first quarter of 2020, we identified the COVID-19 pandemic as a trigger for an impairment review of our~~ ~~Prepaid MTA equipment deployment costs~~ and related intangible assets. After updating our projections to reflect related declines in revenues in 2020 and delays in our anticipated deployment schedule as a result of the impact of the COVID-19 pandemic, among other things, no impairment was identified. In the second and third quarters of 2020, we updated our projections in connection with the amendment to the MTA agreement (see Note 18. ~~Commitments and Contingencies~~ ~~to the Consolidated Financial Statements) and did not identify a triggering event for an impairment review of our~~ ~~Prepaid MTA equipment deployment costs~~. Since it is unlikely we will recoup any costs in 2020 and may not recoup any costs during the 12-month period ending September 30, 2021, as of September 30, 2020, we have reclassified amounts previously included in current ~~Prepaid MTA equipment deployment costs~~ ~~to non-current~~ ~~Prepaid MTA equipment deployment costs~~ ~~on the Consolidated Statement of Financial Position.~~March 31, 2020.

Note 6. Leases

Lessee

As of ~~September 30, 2020,~~March 31, 2021, we have operating lease assets of $1.4 billion, short-term operating lease liabilities of ~~$182.8 million and non-current operating lease liabilities of $1.2 billion. As of December 31, 2019, we had operating lease assets of $1.5 billion, short-term operating lease liabilities of $168.3~~$185.7 million and non-current operating lease liabilities of $1.3 billion. As of ~~September 30,~~December 31, 2020, we had operating lease assets of $1.4 billion, short-term operating lease liabilities of $176.5 million and non-current operating lease liabilities of $1.3 billion. As of March 31, 2021, the weighted-average remaining lease term was ~~10.2~~10.5 years and the weighted-average discount rate was ~~5.6%~~5.4%.

For the three months ended ~~September 30, 2020,~~March 31, 2021, we recorded operating lease costs of ~~$94.3~~$93.7 million in Operating expenses and $2.1 million in Selling, general and administrative expenses. For the three months ended ~~September 30, 2020,~~March 31, 2021, these costs include ~~$16.0~~$13.9 million of variable operating lease costs. For the three months ended ~~September 30, 2019,~~March 31, 2020, we recorded operating lease costs of ~~$103.5~~$102.5 million in Operating expenses and ~~$2.5~~$2.2 million in Selling, general and administrative expenses. For the three months ended ~~September 30, 2019,~~March 31, 2020, these costs include ~~$26.3~~$22.1 million of variable operating lease costs. For each of the ~~nine~~three months ended ~~September 30,~~March 31, 2021 and 2020, ~~we recorded~~sublease income was immaterial.

For the three months ended March 31, 2021, cash paid for operating leases was $97.9 million and leased assets obtained in exchange for new operating lease ~~costs~~liabilities was $69.1 million. For the three months ended March 31, 2020, cash paid for operating leases was $108.6 million and leased assets obtained in exchange for new operating lease liabilities was $77.2 million.

Lessor

We recorded rental income of ~~$290.1~~$215.8 million for the three months ended March 31, 2021, and $262.3 million for the three months ended March 31, 2020, in ~~Operating expenses~~Revenues ~~and $6.4 million~~on our Consolidated Statement of Operations.

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OUTFRONT Media Inc.

Notes to Consolidated Financial Statements

(Unaudited)

in ~~Selling, general and administrative~~ expenses. For the nine months ended September 30, 2020, these costs include $52.7 million of variable operating lease costs. For the nine months ended September 30, 2019, we recorded operating lease costs of $300.5 million in ~~Operating expenses~~ ~~and $6.9 million in~~ ~~Selling, general and administrative~~ expenses. For the nine months ended September 30, 2019, these costs include $66.2 million of variable operating lease costs. For each of the three and nine months ended September 30, 2020 and 2019, sublease income was immaterial.

For the nine months ended September 30, 2020, cash paid for operating leases was $285.9 million and leased assets obtained in exchange for new operating lease liabilities was $147.9 million. For the nine months ended September 30, 2019, cash paid for operating leases was $296.5 million and leased assets obtained in exchange for new operating lease liabilities was $321.9 million.

~~Lessor~~

We recorded rental income of $231.7 million for the three months ended September 30, 2020, $301.3 million for the three months ended September 30, 2019, $676.0 million on for the nine months ended September 30, 2020, and $839.4 million for the nine months ended September 30, 2019, in ~~Revenues~~ ~~on our Consolidated Statement of Operations.~~

Note 7. Asset Retirement Obligation

The following table sets forth the change in the asset retirement obligations associated with our advertising structures located on leased properties. The obligation is calculated based on the assumption that all of our advertising structures will be removed within the next 50 years. The estimated annual costs to dismantle and remove the structures upon the termination or non-renewal of our leases are consistent with our historical experience.


(in millions)
As of December 31, ~~2019~~2020	$	~~35.1~~35.9
Accretion expense	~~1.9~~0.7
Additions	~~0.2~~0.1
Liabilities settled	~~(1.7)~~(0.6)
~~Foreign currency translation adjustments~~	~~(0.1)~~
As of ~~September 30, 2020~~March 31, 2021	$	~~35.4~~36.1

Note 8. Related Party Transactions

We have a 50% ownership interest in 2 joint ventures that operate transit shelters in the greater Los Angeles area and Vancouver, and 4 joint ventures which currently operate a total of 87 billboard displays in New York and Boston. All of these joint ventures are accounted for as equity investments. These investments totaled ~~$11.8~~$9.8 million as of ~~September 30, 2020,~~March 31, 2021, and ~~$15.4~~$10.5 million as of December 31, ~~2019,~~2020, and are included in Other assets on the Consolidated Statements of Financial Position. We provided sales and management services to these joint ventures and recorded management fees in Revenues on the Consolidated Statement of Operations of ~~$1.0~~$1.1 million in the three months ended ~~September 30, 2020, $2.2~~March 31, 2021, and $1.5 million in the three months ended ~~September 30, 2019, $3.5 million in the nine months ended September 30, 2020, and $6.1 million in the nine months ended September 30, 2019.~~March 31, 2020.

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Notes to Consolidated Financial Statements

(Unaudited)

Note 9. Debt

Debt, net, consists of the following:


		As of							As of
(in millions, except percentages)	(in millions, except percentages)	September 30, 2020			December 31, 2019			(in millions, except percentages)	March 31, 2021			December 31, 2020
Short-term debt:	Short-term debt:							Short-term debt:
AR Facility		$	0		$	105.0

Repurchase Facility	Repurchase Facility	80.0			90.0			Repurchase Facility	$	0		$	80.0
Total short-term debt	Total short-term debt	80.0			195.0			Total short-term debt	0			80.0

Long-term debt:	Long-term debt:							Long-term debt:

Term loan, due 2026	Term loan, due 2026	597.7			597.5			Term loan, due 2026	597.9			597.8

Senior unsecured notes:	Senior unsecured notes:							Senior unsecured notes:
5.625% senior unsecured notes, due 2024	5.625% senior unsecured notes, due 2024	501.4			501.7			5.625% senior unsecured notes, due 2024	0			501.3
6.250% senior unsecured notes, due 2025	6.250% senior unsecured notes, due 2025	400.0			0			6.250% senior unsecured notes, due 2025	400.0			400.0
5.000% senior unsecured notes, due 2027	5.000% senior unsecured notes, due 2027	650.0			650.0			5.000% senior unsecured notes, due 2027	650.0			650.0
4.250% senior unsecured notes, due 2029								4.250% senior unsecured notes, due 2029	500.0			0
4.625% senior unsecured notes, due 2030	4.625% senior unsecured notes, due 2030	500.0			500.0			4.625% senior unsecured notes, due 2030	500.0			500.0
Total senior unsecured notes	Total senior unsecured notes	2,051.4			1,651.7			Total senior unsecured notes	2,050.0			2,051.3

Debt issuance costs	Debt issuance costs	(29.5)			(27.1)			Debt issuance costs	(31.3)			(28.3)
Total long-term debt, net	Total long-term debt, net	2,619.6			2,222.1			Total long-term debt, net	2,616.6			2,620.8

Total debt, net	Total debt, net	$	2,699.6		$	2,417.1		Total debt, net	$	2,616.6		$	2,700.8

Weighted average cost of debt	Weighted average cost of debt	4.5		%	4.5		%	Weighted average cost of debt	4.3		%	4.5		%

Term Loan

The interest rate on the term loan due in 2026 (the “Term Loan”) was 1.9% per annum as of ~~September 30, 2020.~~March 31, 2021. As of ~~September 30, 2020,~~March 31, 2021, a discount of ~~$2.3~~$2.1 million on the Term Loan remains unamortized. The discount is being amortized through Interest expense, net, on the Consolidated Statement of Operations.

Revolving Credit Facility

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

As of ~~September 30, 2020,~~March 31, 2021, there were 0 outstanding borrowings under the Revolving Credit Facility.

The commitment fee based on the amount of unused commitments under the Revolving Credit Facility was ~~$0.6 million in the three months ended September 30, 2020,~~ $0.4 million in the three months ended ~~September 30, 2019, $1.2~~March 31, 2021, and $0.3 million in the ~~nine~~three months ended ~~September 30, 2020, and $1.1 million in the nine months ended September 30, 2019.~~March 31, 2020. As of ~~September 30, 2020,~~March 31, 2021, we had issued letters of credit totaling approximately ~~$1.6~~$2.1 million against the letter of credit facility sublimit under the Revolving Credit Facility.

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~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~

Standalone Letter of Credit Facilities

As of ~~September 30, 2020,~~March 31, 2021, we had issued letters of credit totaling approximately $72.0 million under our aggregate $78.0 million standalone letter of credit facilities. The total fees under the letter of credit facilities were immaterial in each of the three ~~and nine~~ months ended ~~September 30, 2020~~March 31, 2021 and ~~2019.~~2020.

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Notes to Consolidated Financial Statements

(Unaudited)

Accounts Receivable Securitization Facilities

As of ~~September 30, 2020,~~March 31, 2021, we have a revolving accounts receivable securitization facility (the “AR Facility”), which terminates in June 2022, unless further extended, and a 364-day uncommitted structured repurchase facility (the “Repurchase Facility” and together with the AR Facility, the “AR Securitization Facilities”), which terminates in June ~~2021, as described below, unless further extended.~~

On June 18, 2020, the Company, certain subsidiaries of the Company and MUFG Bank, Ltd. (“MUFG”) entered into amendments to certain of the agreements governing the Repurchase Facility, pursuant to which the Company, among other things, (i) decreased the maximum borrowing capacity under the Repurchase Facility from $90.0 million to $80.0 million; and (ii) extended the term of the Repurchase Facility so that it will terminate on June 29, 2021, unless further extended.

In connection with the AR Securitization Facilities, Outfront Media LLC and Outfront Media Outernet Inc., each a wholly-owned subsidiary of the Company, and certain of the Company’s taxable REIT subsidiaries (“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”). The SPVs may transfer undivided interests in their respective accounts receivable assets to certain purchasers from time to time (the “Purchasers”). 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. Outfront Media LLC will service the accounts receivables on behalf of the SPVs for a fee. The Company has agreed to guarantee the performance of the Originators and Outfront Media LLC, in its capacity as servicer, of their respective obligations under the agreements governing the AR Facility. Neither the Company, the Originators nor the SPVs guarantee the collectability of the receivables under the AR Facility. Further, the TRS SPV and the QRS SPV are jointly and severally liable for their respective obligations under the agreements governing the AR Facility.

In connection with the Repurchase Facility, the Originators may borrow funds collateralized by subordinated notes (the “Subordinated Notes”) issued by the SPVs in favor of their respective Originators and representing a portion of the outstanding balance of the accounts receivable assets sold by the Originators to the SPVs under the AR Facility. The Subordinated Notes will be transferred to MUFG, as repurchase buyer, on an uncommitted basis, and subject to repurchase by the applicable Originators on termination of the Repurchase Facility. The Originators have granted MUFG a security interest in the Subordinated Notes to secure their obligations under the agreements governing the Repurchase Facility, and the Company has agreed to guarantee the Originators’ obligations under the agreements governing the Repurchase Facility.

As of ~~September 30, 2020,~~March 31, 2021, there were 0 outstanding borrowings under either the AR Facility ~~and $80.0 million of outstanding borrowings under~~or the Repurchase ~~Facility, at a borrowing rate of approximately 1.9%.~~Facility. As of ~~September 30, 2020,~~March 31, 2021, there was 0 borrowing capacity remaining under the AR Facility based on approximately ~~$231.9~~$207.9 million of accounts receivable used as collateral for the AR Securitization Facilities and a related voluntary temporary suspension of the AR Facility, and there was 0$80.0 million of borrowing capacity remaining under the Repurchase Facility, in accordance with the agreements governing the AR Securitization Facilities. The commitment fee based on the amount of unused commitments under the AR Facility was immaterial for each of the three ~~and nine~~ months ended ~~September 30, 2020~~March 31, 2021 and ~~2019.~~2020.

Senior Unsecured Notes

On ~~May 15, 2020,~~January 19, 2021, 2 of our wholly-owned subsidiaries, Outfront Media Capital LLC (“Finance LLC”) and Outfront Media Capital Corporation (“Finance Corp” and, together with Finance LLC, the “Borrowers”), issued ~~$400.0~~$500.0 million aggregate principal amount of ~~6.250%~~4.250% Senior Unsecured Notes due ~~2025~~2029 (the ~~“Notes”~~“2029 Notes”) in a private placement. The 2029 Notes are fully and

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~~OUTFRONT Media Inc.~~

~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~

unconditionally guaranteed on a senior unsecured basis by the Company and each of its direct and indirect domestic subsidiaries that guarantee the Senior Credit Facilities. Interest on the 2029 Notes is payable on ~~June~~January 15 and ~~December~~July 15 of each year, beginning on ~~December~~July 15, ~~2020.~~2021. On or after ~~June~~January 15, ~~2022,~~2024, the Borrowers may redeem at any time, or from time to time, some or all of the 2029 Notes. Prior to such date, the Borrowers may redeem up to 40% ~~of the aggregate principal amount~~ of the aggregate principal amount with the net proceeds of certain equity offerings, provided that at least 50% of the aggregate principal amount of the 2029 Notes will remain outstanding after the redemption.

~~In May 2020,~~On February 16, 2021, we used the net proceeds from the issuance of the 2029 Notes, together with cash on hand, to ~~repay $400.0 million~~redeem all of our outstanding ~~borrowings under our Revolving Credit Facility~~5.625% Senior Unsecured Notes due 2024 (the “2024 Notes”) and to pay accrued and unpaid interest on the 2024 Notes, if any, to, but excluding, the redemption date, and to pay fees and expenses in connection with the 2029 Notes offering and the 2024 Notes redemption. In the first quarter of 2021, we recorded a Loss on extinguishment of debt of $6.3 million relating to the ~~Notes.~~

~~As of September 30, 2020, a premium of $1.4 million on $100.0 million aggregate principal amount of the 5.625% Senior Unsecured~~2024 Notes ~~due 2024, remains unamortized. The premium is being amortized through~~ ~~Interest expense, net~~, on the Consolidated Statement of Operations.

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Notes to Consolidated Financial Statements

(Unaudited)

Debt Covenants

Our credit agreement, dated as of January 31, 2014 (as amended, supplemented or otherwise modified, the “Credit Agreement”), governing the Senior Credit Facilities, the agreements governing the AR Securitization Facilities, and the indentures governing our senior unsecured notes contain customary affirmative and negative covenants, subject to certain exceptions, including but not limited to those that restrict the Company’s and its subsidiaries’ abilities to (i) pay dividends on, repurchase or make distributions in respect to the Company’s or its wholly-owned subsidiary, Outfront Media Capital LLC’s (“Finance LLC’s”) capital stock or make other restricted payments other than dividends or distributions necessary for us to maintain our REIT status, subject to certain conditions and exceptions, (ii) enter into agreements restricting certain subsidiaries’ ability to pay dividends or make other intercompany or third-party transfers, and (iii) incur additional indebtedness. 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 ~~September 30, 2020,~~March 31, 2021, our Consolidated Total Leverage Ratio was ~~8.2~~12.7 to 1.0 in accordance with the Credit Agreement.

The terms of the Credit Agreement (and under certain circumstances, the agreements governing the AR Securitization Facilities) require that we maintain a Consolidated Net Secured Leverage Ratio, which is the ratio of (i) our consolidated secured debt (less up to $150.0 million of unrestricted cash) to (ii) our Consolidated EBITDA (as defined in the Credit Agreement) for the trailing four consecutive quarters, of no greater than 4.5 to 1.0. As of ~~September 30, 2020,~~March 31, 2021, our Consolidated Net Secured Leverage Ratio was ~~1.0~~1.1 to 1.0 in accordance with the Credit Agreement. As of ~~September 30, 2020,~~March 31, 2021, we are in compliance with our debt covenants.

On April 15, 2020, the Company, along with the Borrowers, and other guarantor subsidiaries party thereto, entered into an amendment (the “Amendment”) to the Credit Agreement. The Amendment provides that for the period from April 15, 2020 through September 30, 2021 (i) the Company’s Consolidated Net Secured Leverage Ratio shall be calculated by substituting the Company’s Consolidated EBITDA for each of the quarterly periods ended June 30, 2020 and September 30, 2020, included in any last twelve month compliance testing period, with the Company’s historical Consolidated EBITDA for each of the quarterly periods ended June 30, 2019 and September 30, 2019, respectively; and (ii) the Company will not make any Restricted Payments (as defined in the Credit Agreement) without the consent of the applicable lenders under the Credit Agreement, subject to certain exceptions such as payments necessary to maintain the Company’s REIT status, including any payments on any class of the Company’s capital stock that is required to be made prior to the payment of a dividend or distribution on the Company’s common stock and the Company’s existing payment obligations to holders of the Class A equity interests in Outfront Canada (as defined in Note 10. Equity to the Consolidated Financial Statements).

Deferred Financing Costs

As of ~~September 30, 2020,~~March 31, 2021, we had deferred ~~$34.4~~$35.1 million in fees and expenses associated with the Term Loan, Revolving Credit Facility, AR Securitization Facilities and our senior unsecured notes. We are amortizing the deferred fees through Interest expense, net, on our Consolidated Statement of Operations over the respective terms of the Term Loan, Revolving Credit Facility, AR Securitization Facilities and our senior unsecured notes.

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~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~

Interest Rate Swap Agreements

We have several interest rate cash flow swap agreements to effectively convert a portion of our LIBOR-based variable rate debt to a fixed rate and hedge our interest rate risk related to such variable rate debt. The fair value of these swap positions was a net liability of approximately ~~$6.9~~$4.3 million as of ~~September 30, 2020,~~March 31, 2021, and ~~$4.6~~$5.6 million as of December 31, ~~2019,~~2020, and is included in Other liabilities on our Consolidated Statement of Financial Position.

As of ~~September 30, 2020,~~March 31, 2021, under the terms of ~~the~~these agreements, we will pay interest based on an aggregate notional amount of $200.0 million, under a weighted-average fixed interest rate of 2.7%, with a receive rate of one-month LIBOR and which mature at various dates until June 30, 2022. The one-month LIBOR rate was approximately 0.1% as of ~~September 30, 2020.~~March 31, 2021.

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Notes to Consolidated Financial Statements

(Unaudited)

Fair Value

Under the fair value hierarchy, observable inputs such as unadjusted quoted prices in active markets for identical assets or liabilities are defined as Level 1; observable inputs other than quoted prices included within Level 1 that are either directly or indirectly observable for the asset or liability are defined as Level 2; and unobservable inputs for the asset or liability are defined as Level 3. The aggregate fair value of our debt, which is estimated based on quoted market prices of similar liabilities, was approximately $2.7 billion as of ~~September 30, 2020,~~March 31, 2021, and ~~$2.5~~$2.8 billion as of December 31, ~~2019.~~2020. The fair value of our debt as of both ~~September 30, 2020,~~March 31, 2021, and December 31, ~~2019,~~2020, is classified as Level 2. The aggregate fair value loss associated with our interest rate cash flow swap agreements was approximately ~~$6.9~~$4.3 million as of ~~September 30, 2020,~~March 31, 2021, and ~~$4.6~~$5.6 million as of December 31, ~~2019.~~2020. The aggregate fair value of our interest rate cash flow swap agreements as of both ~~September 30, 2020~~March 31, 2021 and December 31, ~~2019,~~2020, is classified as Level 2.

Note 10. Equity

As of ~~September 30, 2020,~~March 31, 2021, 450,000,000 shares of our common stock, par value $0.01 per share, were authorized; ~~144,429,154~~145,538,216 shares were issued and outstanding; and 50,000,000 shares of our preferred stock, par value $0.01 per share, were authorized with 400,000 shares of ~~our~~ Series A Convertible Perpetual Preferred Stock (the “Series A Preferred Stock”) ~~issued and outstanding.~~

~~On April 20 2020 (the “Closing Date”)~~, ~~the Company issued and sold an aggregate of 400,000 shares of Series A Preferred Stock,~~ par value $0.01 per share, at a purchase price of $1,000 per share, for an aggregate purchase price of $400.0 million (the “Private Placement”) to certain affiliates of Providence Equity Partners LLC (collectively, the “Providence Purchasers”)issued and ~~ASOF Holdings L.L.P. and Ares Capital Corporation (collectively, the “Ares Purchasers” and, together with the Providence Purchasers, the “Purchasers”).~~outstanding.

The Series A Preferred Stock ranks senior to the shares of the Company’s common stock ~~par value $0.01 per share,~~ 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. The dividend rate will increase by an additional 0.75% annually following the eighth anniversary of the Closing Date and is~~arrears, subject to increases ~~under certain other circumstances~~ as set forth in 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 ~~the eighth anniversary of the Closing Date,~~April 20, 2028, after which time dividends will be payable solely in cash. So long as any shares of Series A Preferred Stock remain outstanding, the Company may not declare a dividend on, or make any distributions relating to, capital stock that ranks junior to, or on a parity basis with, the Series A Preferred Stock, subject to certain exceptions, including but not limited to (i) any dividend or distribution in cash or capital stock of the Company on or in respect of the capital stock of the Company to the extent that such dividend or distribution is necessary to maintain the Company’s status as a REIT; and (ii) any dividend or distribution in cash in respect of our common stock that, together with the dividends or distributions during the 12-month period immediately preceding such dividend or distribution, is not in excess of 5% of the aggregate dividends or distributions paid by the Company necessary to maintain its REIT status during such 12-month period. ~~Following the one-year anniversary of the Closing Date, if all or~~If any ~~portion of the~~ dividends or distributions ~~is paid~~ in respect of the shares of our common stock are paid in cash, the shares of Series A Preferred Stock will participate in ~~such~~the dividends or distributions on an as-converted basis up to the amount of their accrued dividend ~~on the Series A Preferred Stock~~ for such quarter, which amounts will reduce the dividends payable on the shares of Series A Preferred Stock dollar-for-dollar for such quarter.

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~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~

The Series A Preferred Stock is convertible at the option of any holder at any time into shares of our common stock at an initial conversion price of $16.00 per share and an initial conversion rate of 62.50 shares of our common stock per share of Series A Preferred Stock, subject to certain anti-dilution ~~adjustments. The issuance of shares of our common stock upon~~adjustments and a share cap as set forth in the conversion of Series A Preferred Stock is subject to a cap equal to 28,856,239 shares of our common stock (the “Share Cap”), unless and until the Company obtains stockholder approval to the extent required for the issuance of additional shares. Any amounts owed above the Share Cap must be paid in cash.

Articles. Subject to certain conditions atset forth in the ~~Company’s option, (i) after the third anniversary~~Articles (including a change of control), each of the ~~Closing Date, all~~Company and the holders of the Series A Preferred Stock may ~~be converted into shares of our common stock, and (ii) after the seventh anniversary of the Closing Date, all of~~convert or redeem the Series A Preferred Stock ~~may be redeemed for cash~~ at ~~a redemption price equal to 100% of~~ the ~~liquidation preference of~~prices set forth in the ~~Series A Preferred Stock,~~Articles, plus any accrued and unpaid dividends. Subject to certain conditions, each holder of the Series A Preferred Stock, after a Change of Control (as defined in the Articles) may (i) require the Company to purchase any or all of their shares of Series A Preferred Stock at a redemption price payable in cash equal to 105% of the liquidation preference of the Series A Preferred Stock, plus any accrued and unpaid dividends, or (ii) convert any or all of their shares of Series A Preferred Stock into the number of shares of our common stock equal to the liquidation preference (including accrued and unpaid dividends) divided by the then-applicable conversion price.

During the three months ended ~~September 30, 2020,~~March 31, 2021, we paid cash dividends of $7.0 million on the Series A Preferred ~~Stock and during the nine months ended September 30, 2020, we paid cash dividends of $12.5 million on the Series A Preferred~~ Stock. As of ~~September 30, 2020,~~March 31, 2021, the maximum number of shares of common stock that could be required to be issued on conversion of the outstanding shares of Series A Preferred Stock was 25.0 million shares.

In connection with the acquisition of outdoor advertising assets in Canada in June 2017, the Company issued 1,953,407 shares of Class A equity interests of a subsidiary of the Company that controls its Canadian business (“Outfront Canada”). The Class A equity interests are entitled to receive priority cash distributions from Outfront Canada at the same time and in the same per share amount as the dividends paid on shares of the Company’s common stock. The Class A equity interests may be redeemed by the holders in exchange for shares of the Company’s common stock on a one-for-one basis (subject to anti-dilution adjustments) or, at the Company’s option, cash equal to the then fair market value of the shares of the Company’s common stock. The Company is also subject to limitations on its ability to sell or otherwise dispose of the assets acquired in Canada until June 2022, unless it pays holders of the Class A equity interests in Outfront Canada an amount intended to approximate their resulting tax liability, plus a tax gross-up.

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Notes to Consolidated Financial Statements

(Unaudited)

During the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, we made 0 distributions ~~of $0.4 million~~ to holders of the Class A equity ~~interests, which are recorded in~~ ~~Dividends~~ ~~on our Consolidated Statements of Equity and Consolidated Statements of Cash Flows.~~interests. As of ~~September 30, 2020, 1,026,727~~March 31, 2021, 1,527,579 Class A equity interests have been redeemed for shares of the Company’s common stock.

We have a sales agreement in connection with an “at-the-market” equity offering program (the “ATM Program”), under which we may, from time to time, issue and sell shares of our common stock up to an aggregate offering price of $300.0 million. 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. NaN shares were sold under the ATM Program during ~~both~~ the three ~~and nine~~ months ended ~~September 30, 2020.~~March 31, 2021. As of ~~September 30, 2020,~~March 31, 2021, we had approximately $232.5 million of capacity remaining under the ATM Program.

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~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~

Note 11. Revenues

The following table summarizes revenues by source:


		Three Months Ended				Nine Months Ended					Three Months Ended
		September 30,				September 30,					March 31,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)		2021		2020
Billboard:	Billboard:									Billboard:
Static displays	Static displays	$	179.5	$	234.7	$	530.1	$	658.1	Static displays		$	165.1	$	201.1
Digital displays	Digital displays	51.2		65.8		142.9		179.0		Digital displays		49.3		60.4
Other	Other	9.2		11.5		26.3		31.7		Other		9.2		9.4
Billboard revenues	Billboard revenues	239.9		312.0		699.3		868.8		Billboard revenues		223.6		270.9
Transit:	Transit:									Transit:
Static displays	Static displays	28.5		94.1		116.5		270.2		Static displays		23.9		65.1
Digital displays	Digital displays	7.6		27.6		41.9		72.6		Digital displays		6.4		27.7
Other	Other	5.8		11.6		16.6		33.3		Other		4.6		7.4
Total transit revenues	Total transit revenues	41.9		133.3		175.0		376.1		Total transit revenues		34.9		100.2
Sports marketing and other	Sports marketing and other	0.5		17.2		26.2		49.2		Sports marketing and other		0.7		14.2
Transit and other revenues	Transit and other revenues	42.4		150.5		201.2		425.3		Transit and other revenues		35.6		114.4
Total revenues	Total revenues	$	282.3	$	462.5	$	900.5	$	1,294.1	Total revenues		$	259.2	$	385.3

Rental income was ~~$231.7~~$215.8 million in the three months ended ~~September 30, 2020, $301.3~~March 31, 2021, and $262.3 million in the three months ended ~~September 30, 2019, $676.0 million in the nine months ended September 30,~~March 31, 2020, ~~and $839.4 million in the nine months ended September 30, 2019,~~ and is recorded in Billboard revenues on the Consolidated Statement of Operations.

The following table summarizes revenues by geography:


		Three Months Ended				Nine Months Ended					Three Months Ended
		September 30,				September 30,					March 31,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)		2021		2020
United States:	United States:									United States:
Billboard	Billboard	$	226.0	$	292.8	$	663.9	$	814.1	Billboard		$	212.5	$	256.5
Transit and other	Transit and other	39.8		129.9		170.1		366.6		Transit and other		32.9		98.2
Sports marketing and other	Sports marketing and other	0.3		17.2		26.0		49.2		Sports marketing and other		0.7		14.2
Total United States revenues	Total United States revenues	266.1		439.9		860.0		1,229.9		Total United States revenues		246.1		368.9
Canada	Canada	16.2		22.6		40.5		64.2		Canada		13.1		16.4
Total revenues	Total revenues	$	282.3	$	462.5	$	900.5	$	1,294.1	Total revenues		$	259.2	$	385.3

We recognized substantially all of the Deferred revenues on the Consolidated Statement of Financial Position as of December 31, ~~2019,~~2020, during the three months ended March 31, ~~2020.~~2021.

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Notes to Consolidated Financial Statements

(Unaudited)

Note 12. Restructuring Charges

In order to preserve financial flexibility, increase liquidity and reduce expenses in light of the current uncertainty in the global economy and our business as a result of the COVID-19 pandemic, on May 5, 2020, we announced a workforce reduction in the U.S. and notified approximately 70 employees of their termination. On June 15, 2020, we announced a workforce reduction in Canada and notified approximately 20 employees of their termination.

As of ~~September 30, 2020, $2.5~~March 31, 2021, $1.0 million in restructuring reserves remain outstanding and is included in Other current liabilities on the Consolidated Statement of Financial Position. ~~For the three months ended September 30, 2020, we recorded restructuring charges of $0.6 million, of which $0.4 million was recorded in our~~ ~~U.S. Media~~ ~~segment and $0.2 million was recorded in~~ ~~Other~~.

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~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~

~~For the nine months ended September 30, 2020, we recorded restructuring charges of $5.3 million, of which $3.4 million was recorded in our~~ ~~U.S. Media~~ ~~segment, $0.9 million was recorded in~~ ~~Other~~ and $1.0 million was recorded in Corporate. Restructuring charges in the nine months ended September 30, 2020, were composed of severance charges associated with the workforce reductions, including $0.9 million for stock-based compensation. For the nine months ended September 30, 2019, we recorded restructuring charges of $0.3 million associated with the elimination of a corporate management position.

Note 13. ~~Acquisitions and Dispositions~~

Acquisitions

We completed several asset acquisitions for a total purchase price of approximately ~~$15.5~~$15.8 million in the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, and ~~$41.7~~$6.6 million in the ~~nine~~three months ended ~~September 30, 2019.~~March 31, 2020.

In the second quarter of 2018, we entered into an agreement to acquire 14 digital and 7 static billboard displays in California for a total estimated purchase price of $35.4 million. In the second quarter of 2019, we completed this acquisition except with respect to 4 digital displays, which we expect to acquire in 2022 for an estimated purchase price of $9.2 million, subject to customary closing conditions and the timing of site development.

In the first quarter of 2019, we entered into an agreement to acquire 8 digital billboard displays in Atlanta, Georgia, for an aggregate purchase price of $24.0 million. During 2019, we paid deposits totaling $19.0 million into an escrow account related to this transaction, which were included in ~~Other assets~~ ~~on our Consolidated Statement of Financial Position as of December 31, 2019. We completed this transaction in the first quarter of 2020.~~

~~Dispositions~~

In the third quarter of 2020, we completed the Sports Disposition and received approximately $34.6 million in cash, subject to closing and post-closing adjustments. We recorded a gain of $7.2 million related to the Sports Disposition.

Note 14. Stock-Based Compensation

In the first quarter of 2021, the Company granted one-time equity award grants to our executive officers. The grant values of the one-time restricted share unit (“RSU”) awards were equal to 100% of each executive officer’s current base salary, and comprised of 60% performance-based RSUs (“PRSUs”), which contain a market and service condition, and 40% time-based RSUs, which only contain a service condition. The PRSU market condition will be based on the Company’s total shareholder return (“TSR”) relative to the TSRs of the companies in the iShares Evolved U.S. Media and Entertainment Index as of January 1, 2021, measured over a two-year performance period, with the number of PRSUs eligible to vest ranging from 0% to 200% of target based on a percentile ranking of the Company’s relative TSR. Subject to the market condition, these one-time equity grants will cliff vest in full on the second anniversary of the award grant date. A Monte Carlo method simulation has been used to estimate the grant date fair value of the PRSUs that have a market condition.

The following table summarizes our stock-based compensation expense for the three ~~and nine~~ months ended ~~September 30, 2020~~March 31, 2021 and ~~2019.~~2020.


		Three Months Ended				Nine Months Ended					Three Months Ended
		September 30,				September 30,					March 31,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)		2021		2020
Stock-based compensation expenses (restricted share units (“RSUs”) and performance-based RSUs (“PRSUs”)), before income taxes		$	5.4	$	5.6	$	17.3	$	16.4
Stock-based compensation expenses (RSUs and PRSUs), before income taxes										Stock-based compensation expenses (RSUs and PRSUs), before income taxes		$	6.0	$	5.8
Tax benefit	Tax benefit	(0.3)		(0.4)		(1.0)		(1.1)		Tax benefit		(0.3)		(0.4)
Stock-based compensation expense, net of tax	Stock-based compensation expense, net of tax	$	5.1	$	5.2	$	16.3	$	15.3	Stock-based compensation expense, net of tax		$	5.7	$	5.4

As of ~~September 30, 2020,~~March 31, 2021, total unrecognized compensation cost related to non-vested RSUs and PRSUs was ~~$29.2~~$52.6 million, which is expected to be recognized over a weighted average period of ~~1.9~~2.1 years.

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Notes to Consolidated Financial Statements

(Unaudited)

RSUs and PRSUs

The following table summarizes activity for the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, of RSUs and PRSUs issued to our employees.


		Activity	Weighted Average Per Share Grant Date Fair Market Value			Activity	Weighted Average Per Share Grant Date Fair Market Value
Non-vested as of December 31, 2019		2,024,768	$	22.09
Non-vested as of December 31, 2020					Non-vested as of December 31, 2020	2,208,059	$	24.80
Granted:	Granted:				Granted:
RSUs	RSUs	751,413	29.91		RSUs	954,350	21.48
PRSUs	PRSUs	323,771	29.60		PRSUs	567,571	23.34
Vested:	Vested:				Vested:
RSUs	RSUs	(682,170)	22.99		RSUs	(651,997)	24.55
PRSUs	PRSUs	(298,824)	22.53		PRSUs	(239,202)	21.81
Forfeitures:	Forfeitures:				Forfeitures:
RSUs	RSUs	(36,530)	25.41		RSUs	(6,178)	25.48
PRSUs	PRSUs	(6,930)	26.64		PRSUs	(259,086)	30.63
Non-vested as of September 30, 2020		2,075,498	25.66
Non-vested as of March 31, 2021					Non-vested as of March 31, 2021	2,573,517	23.00

Stock Options

The following table summarizes activity for the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, of stock options issued to our employees.

Activity Weighted Average Exercise Price
Outstanding as of December 31, 2019 126,528 $ 24.57
Exercised (23,115) 16.43
Outstanding as of September 30, 2020 103,413 26.39
Exercisable as of September 30, 2020 103,413 26.39


	Activity	Weighted Average Exercise Price
Outstanding as of December 31, 2020	103,413	$	26.39


Outstanding as of March 31, 2021	103,413	26.39

Exercisable as of March 31, 2021	103,413	26.39

As of ~~September 30, 2020,~~March 31, 2021, all exercisable stock options issued to our employees were out-of-the-money based on the closing stock price of our common stock of ~~$14.55.~~$21.83.

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~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~

Note 15. Retirement Benefits

The following table presents the components of net periodic pension cost and amounts recognized in other comprehensive income (loss) for our pension plans:


		Three Months Ended				Nine Months Ended					Three Months Ended
		September 30,				September 30,					March 31,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)		2021		2020
Components of net periodic pension cost:	Components of net periodic pension cost:									Components of net periodic pension cost:
Service cost	Service cost	$	0.2	$	0.6	$	0.9	$	1.5	Service cost		$	0.1	$	0.4
Interest cost	Interest cost	0.6		0.5		1.9		1.5		Interest cost		0.5		0.7
Expected return on plan assets	Expected return on plan assets	(1.0)		(0.7)		(3.0)		(2.0)		Expected return on plan assets		(0.8)		(1.1)
Amortization of net actuarial losses(a)	Amortization of net actuarial losses(a)	0		0.1		0.5		0.4		Amortization of net actuarial losses(a)		0.2		0.3

Net periodic pension cost	Net periodic pension cost	$	(0.2)	$	0.5	$	0.3	$	1.4	Net periodic pension cost		$	0	$	0.3

(a)Reflects amounts reclassified from accumulated other comprehensive income to net income.

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Notes to Consolidated Financial Statements

(Unaudited)

In the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, we contributed ~~$1.0~~$0.3 million to our pension plans. In ~~2020,~~2021, we expect to contribute approximately ~~$1.3~~$1.2 million to our pension plans.

Note 16. Income Taxes

We are organized in conformity with the requirements for qualification and taxation as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”) and, accordingly, we have not provided for U.S. federal income tax on our REIT taxable income that we distribute to our stockholders. We have elected to treat our subsidiaries that participate in certain non-REIT qualifying activities ~~and our foreign subsidiaries,~~ as TRSs. As such, we have provided for their federal, state and foreign income taxes.

Tax years ~~2016~~2017 to present are open for examination by the tax authorities.

Our effective income tax rate represents a combined annual effective tax rate for federal, state, local and foreign taxes applied to interim operating results.

In the ~~nine~~three months ended ~~September 30,~~March 31, 2021 and 2020, ~~and 2019,~~ our effective tax rate differed from the U.S. federal statutory income tax rate primarily due to our REIT status, including the dividends paid deduction, the impact of state and local taxes, and the effect of foreign ~~operations and the impact of the Sports Disposition.~~operations.

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~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~

Note 17. Earnings Per Share (“EPS”)


		Three Months Ended				Nine Months Ended					Three Months Ended
		September 30,				September 30,					March 31,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)		2021		2020
Net income (loss) available for common stockholders	Net income (loss) available for common stockholders	$	(13.5)	$	38.7	$	(65.3)	$	95.1	Net income (loss) available for common stockholders		$	(67.7)	$	6.1
Less: Distributions to holders of Series A Preferred Stock	Less: Distributions to holders of Series A Preferred Stock	7.0		0		12.5		0		Less: Distributions to holders of Series A Preferred Stock		7.0		0
Less: Distributions to holders of Class A equity interests of a subsidiary	Less: Distributions to holders of Class A equity interests of a subsidiary	0		0.4		0.4		1.5		Less: Distributions to holders of Class A equity interests of a subsidiary		0		0.4

Net income (loss) available for common stockholders, basic and diluted	Net income (loss) available for common stockholders, basic and diluted	$	(20.5)	$	38.3	$	(78.2)	$	93.6	Net income (loss) available for common stockholders, basic and diluted		$	(74.7)	$	5.7

Weighted average shares for basic EPS	Weighted average shares for basic EPS	144.4		143.4		144.2		142.1		Weighted average shares for basic EPS		144.8		143.9
Dilutive potential shares from grants of RSUs, PRSUs and stock options(a)	Dilutive potential shares from grants of RSUs, PRSUs and stock options(a)	0		0.8		0		0.6		Dilutive potential shares from grants of RSUs, PRSUs and stock options(a)		0		0.8

Weighted average shares for diluted EPS	Weighted average shares for diluted EPS	144.4		144.2		144.2		142.7		Weighted average shares for diluted EPS		144.8		144.7

(a)The potential impact of an aggregate ~~1.7~~1.9 million granted RSUs, PRSUs and stock options in the three months ended ~~September 30, 2020, 1.1~~March 31, 2021, and 0.5 million granted RSUs, PRSUs and stock options in the ~~nine~~three months ended ~~September 30,~~March 31, 2020, ~~and 0.1 million granted RSUs, PRSUs and stock options in the nine months ended September 30, 2019,~~ were antidilutive.

(b)The potential impact of 25.0 million shares of our common stock issuable upon conversion of ~~our~~the Series A Preferred Stock in the three months ended ~~September 30, 2020, and 15.0 million shares of our common stock issuable upon conversion of our Series A Preferred Stock in the nine months ended September 30, 2020,~~March 31, 2021, was antidilutive.

(c)The potential impact of ~~0.9~~0.8 million of Class A equity interests of Outfront Canada in the three months ended ~~September 30, 2020, 1.3~~March 31, 2021, and 1.1 million of Class A equity interests of Outfront Canada in the three months ended ~~September 30, 2019, 1.0 million of Class A equity interests of Outfront Canada in the nine months ended September 30,~~March 31, 2020, ~~and 1.5 million of Class A equity interests of Outfront Canada in the nine months ended September 30, 2019,~~ was antidilutive. (See Note 10. Equity to the Consolidated Financial Statements.)

Note 18. Commitments and Contingencies

Off-Balance Sheet Arrangements

Our off-balance sheet commitments primarily consist of guaranteed minimum annual payments. These arrangements result from our normal course of business and represent obligations that are payable over several years.

Contractual Obligations

We have agreements with municipalities and transit operators that entitle us to operate advertising displays within their transit systems, including on the interior and exterior of rail and subway cars and buses, as well as on benches, transit shelters, street kiosks, and transit platforms. Under most of these franchise agreements, the franchisor is entitled to receive the greater of a percentage of the relevant revenues, net of agency fees, or a specified guaranteed minimum annual payment.

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Notes to Consolidated Financial Statements

(Unaudited)

~~As of September 30, 2020, guaranteed minimum annual payments are as follows:~~

(in millions) Guaranteed
Minimum
Annual
Payments
2020(a)
$ 4.3
2021 199.4
2022 204.9
2023 179.3
2024 179.7
2025 and thereafter 559.3
Total minimum payments $ 1,326.9

~~(a)In the third quarter of 2020, we completed the Sports Disposition. (See Note 13.~~ ~~Acquisitions and Dispositions~~: ~~Dispositions~~.)

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~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~


(in millions)	(in millions)	Beginning Balance		Deployment Costs Incurred		Recoupment		Amortization		Ending Balance		(in millions)	Beginning Balance		Deployment Costs Incurred		Recoupment/MTA Funding		Amortization		Ending Balance
Nine months ended September 30, 2020:
Three months ended March 31, 2021:												Three months ended March 31, 2021:
Prepaid MTA equipment deployment costs	Prepaid MTA equipment deployment costs	$	171.5	$	29.4	$	0	$	—	$	200.9	Prepaid MTA equipment deployment costs	$	204.6	$	3.6	$	—	$	—	$	208.2
Other current assets	Other current assets	—		21.7		—		—		21.7		Other current assets	28.0		9.1		(16.2)		—		20.9
Intangible assets (franchise agreements)	Intangible assets (franchise agreements)	38.3		15.6		—		(4.1)		49.8		Intangible assets (franchise agreements)	58.4		4.7		—		(2.5)		60.6
Total	Total	$	209.8	$	66.7	$	0	$	(4.1)	$	272.4	Total	$	291.0	$	17.4	$	(16.2)	$	(2.5)	$	289.7

Year ended December 31, 2019:
Year ended December 31, 2020:												Year ended December 31, 2020:
Prepaid MTA equipment deployment costs	Prepaid MTA equipment deployment costs	$	79.5	$	124.2	$	(32.2)	$	—	$	171.5	Prepaid MTA equipment deployment costs	$	171.5	$	33.1	$	—	$	—	$	204.6
Other current assets												Other current assets	—		44.4		(16.4)		—		28.0
Intangible assets (franchise agreements)	Intangible assets (franchise agreements)	14.8		26.6		—		(3.1)		38.3		Intangible assets (franchise agreements)	38.3		26.0		—		(5.9)		58.4
Total	Total	$	94.3	$	150.8	$	(32.2)	$	(3.1)	$	209.8	Total	$	209.8	$	103.5	$	(16.4)	$	(5.9)	$	291.0

Letters of Credit

We have indemnification obligations with respect to letters of credit and surety bonds primarily used as security against non-performance in the normal course of business. As of ~~September 30, 2020,~~March 31, 2021, the outstanding letters of credit were approximately ~~$73.6~~$74.1 million and outstanding surety bonds were approximately ~~$175.5~~$167.5 million, and were not recorded on the Consolidated Statements of Financial Position.

Legal Matters

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Notes to Consolidated Financial Statements

(Unaudited)

eventual outcome of any litigation, in our opinion, none of our current litigation is expected to have a material adverse effect on our results of operations, financial position or cash flows.

Note 19. Segment Information

We currently manage our operations through 2 operating segments—U.S. Billboard and Transit, which is included in our U.S. Media reportable segment, and International. International does not meet the criteria to be a reportable segment and accordingly, is included in Other.

The following tables set forth our financial performance by segment. In the third quarter of 2020, we completed the Sports ~~Disposition (see Note 13.~~ ~~Acquisitions and Dispositions~~: ~~Dispositions~~ ~~to the Consolidated Financial Statements).~~Disposition. Historical operating results for our Sports Marketing operating segment through June 30, 2020, are included in Other.


		Three Months Ended				Nine Months Ended					Three Months Ended
		September 30,				September 30,					March 31,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)		2021		2020
Revenues:	Revenues:									Revenues:
U.S. Media	U.S. Media	$	265.8	$	422.7	$	834.0	$	1,180.7	U.S. Media		$	245.4	$	354.7
Other	Other	16.5		39.8		66.5		113.4		Other		13.8		30.6
Total revenues	Total revenues	$	282.3	$	462.5	$	900.5	$	1,294.1	Total revenues		$	259.2	$	385.3

We present Operating income (loss) before Depreciation, Amortization, Net gain on dispositionsand Stock-based compensation ~~and~~ ~~Restructuring charges~~ (“Adjusted OIBDA”) as the primary measure of profit and loss for our operating segments.


	Three Months Ended
	March 31,
(in millions)		2021		2020
Net income (loss) before allocation to non-controlling interests		$	(67.6)	$	6.3
Benefit for income taxes		(4.7)		(1.7)
Equity in earnings of investee companies, net of tax		0.4		(0.4)
Interest expense, net		34.6		29.8
Loss on extinguishment of debt		6.3		0
Other income, net		0		(0.2)
Operating income (loss)		(31.0)		33.8

Net gain on dispositions		(0.3)		(0.1)
Depreciation and amortization(a)		36.4		36.0
Stock-based compensation		6.0		5.8
Total Adjusted OIBDA(a)		$	11.1	$	75.5

Adjusted OIBDA:
U.S. Media(a)		$	24.6	$	80.0
Other(a)		(2.0)		0
Corporate		(11.5)		(4.5)
Total Adjusted OIBDA(a)		$	11.1	$	75.5

(a)Consistent with the current year’s presentation, we have reclassified amortization of direct lease acquisition costs of $11.3 million in the three months ended March 31, 2020, of which $10.8 million was recorded in our U.S. Media segment and $0.5 million was recorded in Other, from Amortization to SG&A expenses, resulting in a corresponding decrease in Adjusted OIBDA.

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Notes to Consolidated Financial Statements

(Unaudited)

Three Months Ended Nine Months Ended
September 30, September 30,
(in millions) 2020 2019 2020 2019
Net income (loss) before allocation to non-controlling interests $ (13.3) $ 38.7 $ (65.0) $ 95.1
Provision for income taxes 3.5 3.3 0.3 8.5
Equity in earnings of investee companies, net of tax 0.6 (1.4) 0.5 (3.9)
Interest expense, net 34.2 33.9 97.3 100.5
Loss on extinguishment of debt 0 11.0 0 11.0
Other income (loss), net 0.1 0 (0.1) (0.1)
Operating income 25.1 85.5 33.0 211.1
Restructuring charges 0.6 0 5.3 0.3
Net gain on dispositions (8.0) (1.9) (13.3) (3.0)
Depreciation and amortization 45.4 51.1 135.6 145.9
Stock-based compensation 5.4 5.6 16.4 16.4
Total Adjusted OIBDA $ 68.5 $ 140.3 $ 177.0 $ 370.7
Adjusted OIBDA:
U.S. Media $ 74.2 $ 147.3 $ 202.4 $ 387.7
Other 3.2 4.3 (1.7) 14.3
Corporate (8.9) (11.3) (23.7) (31.3)
Total Adjusted OIBDA $ 68.5 $ 140.3 $ 177.0 $ 370.7


	Three Months Ended
	March 31,
(in millions)		2021		2020
Operating income (loss):
U.S. Media		$	(8.6)	$	47.4
Other		(4.9)		(3.3)
Corporate		(17.5)		(10.3)
Total operating income (loss)		$	(31.0)	$	33.8

Net gain on dispositions:
U.S. Media		$	(0.3)	$	(0.1)

Total gain on dispositions		$	(0.3)	$	(0.1)

Depreciation and amortization:
U.S. Media(a)		$	33.5	$	32.7
Other(a)		2.9		3.3
Total depreciation and amortization(a)		$	36.4	$	36.0

Capital expenditures:
U.S. Media		$	8.9	$	17.3
Other		0.5		0.9
Total capital expenditures		$	9.4	$	18.2

Three Months Ended Nine Months Ended
September 30, September 30,
(in millions) 2020 2019 2020 2019
Operating income (loss):
U.S. Media $ 31.9 $ 103.1 $ 75.4 $ 260.5
Other 7.5 (0.7) (1.3) (1.4)
Corporate (14.3) (16.9) (41.1) (48.0)
Total operating income $ 25.1 $ 85.5 $ 33.0 $ 211.1
Net (gain) loss on dispositions:
U.S. Media $ 0 $ (1.9) $ (1.2) $ (3.2)
Other (8.0) 0 (12.1) 0.2
Total gain on dispositions $ (8.0) $ (1.9) $ (13.3) $ (3.0)
Depreciation and amortization:
U.S. Media $ 41.9 $ 46.1 $ 124.8 $ 130.4
Other 3.5 5.0 10.8 15.5
Total depreciation and amortization $ 45.4 $ 51.1 $ 135.6 $ 145.9
Capital expenditures:
U.S. Media $ 9.4 $ 25.1 $ 40.3 $ 63.4
Other 0.7 0.7 1.7 2.0
Total capital expenditures $ 10.1 $ 25.8 $ 42.0 $ 65.4

~~Table~~(a)Consistent with the current year’s presentation, we have reclassified amortization of ~~Contents~~direct lease acquisition costs of $11.3 million in the three months ended March 31, 2020, of which $10.8 million was recorded in our U.S. Media segment and $0.5 million was recorded in Other, from Amortization to SG&A expenses, resulting in a corresponding decrease in Adjusted OIBDA.

~~OUTFRONT Media Inc.~~

~~Notes to Consolidated Financial Statements~~

~~(Unaudited)~~


		As of					As of
(in millions)	(in millions)	September 30, 2020		December 31, 2019		(in millions)	March 31, 2021		December 31, 2020
Assets:	Assets:					Assets:
U.S. Media	U.S. Media	$	4,973.5	$	5,077.1	U.S. Media	$	4,950.8	$	4,977.2
Other	Other	236.5		284.0		Other	245.8		249.5
Corporate	Corporate	660.5		21.2		Corporate	517.3		670.2
Total assets	Total assets	$	5,870.5	$	5,382.3	Total assets	$	5,713.9	$	5,896.9

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with our historical consolidated financial statements and the notes thereto appearing in our Annual Report on Form 10-K for the year ended December 31, ~~2019,~~2020, filed with the Securities and Exchange Commission (the “SEC”) on February 26, ~~2020,~~2021, and the unaudited consolidated financial statements and the notes thereto included in this Quarterly Report on Form 10-Q. This MD&A contains forward-looking statements that involve numerous risks and uncertainties. The forward-looking statements are subject to a number of important factors, including, but not limited to, those factors discussed in the sections entitled “Risk Factors” in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, ~~2019,~~2020, filed with the SEC on February 26, ~~2020,~~2021, and the section entitled “Cautionary Statement Regarding Forward-Looking Statements” in this Quarterly Report on Form 10-Q, that could cause our actual results to differ materially from the results described herein or implied by such forward-looking statements. Except as otherwise indicated or unless the context otherwise requires, all references in this Quarterly Report on Form 10-Q to (i) “OUTFRONT Media,” “the Company,” “we,” “our,” “us” and “our company” mean OUTFRONT Media Inc., a Maryland corporation, and unless the context requires otherwise, its consolidated subsidiaries, and (ii) the “25 largest markets in the U.S.,” “approximately 150 markets in the U.S. and Canada” and “Nielsen Designated Market Areas” are based, in whole or in part, on Nielsen Media Research’s Designated Market Area rankings as of January 1, ~~2020.~~2021.

Overview

OUTFRONT Media is a real estate investment trust (“REIT”), which provides advertising space (“displays”) on out-of-home advertising structures and sites in the United States (the “U.S.”) and Canada. We currently manage our operations through two operating segments—U.S. Billboard and Transit, which is included in our U.S. Media reportable segment, and International. International does not meet the criteria to be a reportable segment and accordingly, is included in Other (see Note 19. Segment Information to the Consolidated Financial Statements).

In the third quarter of 2020, we sold all of our equity interests in certain of our subsidiaries (the “Sports Disposition”), which held all of the assets of our Sports Marketing operating segment, for a purchase price of approximately $34.6 million in cash, subject to closing and post-closing adjustments. The Sports Marketing operating segment was the marketing and multimedia rights holder for a variety of colleges, universities and other educational institutions across the United States. The operating results of our Sports Marketing operating segment through June 30, 2020, are included in our Consolidated Financial Statements and are included in Other in our segment reporting.

Business

We are one of the largest providers of advertising space on out-of-home advertising structures and sites across the U.S. and Canada. Our inventory consists of billboard displays, which are primarily located on the most heavily traveled highways and roadways in top Nielsen Designated Market Areas (“DMAs”), and transit advertising displays operated under exclusive multi-year contracts with municipalities in large cities across the U.S. and Canada. In total, we have displays in all of the 25 largest markets in the U.S. and approximately 150 markets in the U.S. and Canada. Our top market, high profile location focused portfolio includes sites in and around both Grand Central Station and Times Square in New York, various locations along Sunset Boulevard in Los Angeles, and the Bay Bridge in San Francisco. The breadth and depth of our portfolio provides our customers with a range of options to address their marketing objectives, from national, brand-building campaigns to hyper-local campaigns that drive customers to the advertiser’s website or retail location “one mile down the road.”

In addition to providing location-based displays, we also focus on delivering mass and targeted audiences to our customers. Geopath, the out-of-home advertising industry’s audience measurement system, enables us to build campaigns based on the size and demographic composition of audiences. As part of our technology platform, we are developing solutions for enhanced demographic and location targeting, and engaging ways to connect with consumers on-the-go. Additionally, our OUTFRONT Mobile Network and social influence add-on products allow our customers to further leverage location targeting with interactive mobile advertising and social sharing amplification.

We believe out-of-home continues to be an attractive form of advertising, as our displays are always viewable and cannot be turned off, skipped, blocked or fast-forwarded. Further, out-of-home advertising can be an effective “stand-alone” medium, as well as an integral part of a campaign to reach audiences using multiple forms of media, including television, radio, print, online, mobile and social media advertising platforms. We provide our customers with a differentiated advertising solution at an attractive price point relative to other forms of advertising. In addition to leasing displays, we provide other value-added

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

U.S. Media. Our U.S. Media segment generated 12% of its revenues in the New York City metropolitan area in the three months ended ~~September 30, 2020,~~March 31, 2021 and 22% in the three months ended ~~September 30, 2019, 16% in the nine months ended September 30,~~March 31, 2020, ~~and 23% in the nine months ended September 30, 2019,~~ and generated 15% in the Los Angeles metropolitan area in each of the three months ended ~~September 30, 2020, 16% in the three months ended September 30, 2019, 15% in the nine months ended September 30, 2020~~March 31, 2021 and ~~16% in the nine months ended September 30, 2019.~~2020. In the three months ended ~~September 30, 2020,~~March 31, 2021, our U.S. Media segment generated ~~$265.8~~$245.4 million of Revenues and ~~$74.2~~$24.6 million of Operating income before Depreciation, Amortization, Net gain on dispositions, and Stock-based compensation~~and~~ ~~Restructuring charges~~ (“Adjusted OIBDA”). In the three months ended ~~September 30, 2019, our~~ ~~U.S. Media~~ ~~segment generated $422.7 million of~~ ~~Revenues~~ ~~and $147.3 million of Adjusted OIBDA. In the nine months ended September 30,~~March 31, 2020, our U.S. Media segment generated ~~$834.0~~$354.7 million of Revenues and ~~$202.4 million of Adjusted OIBDA. In the nine months ended September 30, 2019, our~~ ~~U.S. Media~~ ~~segment generated $1,180.7 million of~~ ~~Revenues~~ ~~and $387.7~~$80.0 million of Adjusted OIBDA. (See the “Segment Results of Operations” section of this MD&A.)

Other (includes International and through June 30, 2020, Sports Marketing). In the three months ended ~~September 30, 2020,~~March 31, 2021, Other generated ~~$16.5 million of~~ ~~Revenues~~ ~~and $3.2 million of Adjusted OIBDA. In the three months ended September 30, 2019,~~ ~~Other~~ ~~generated $39.8 million of~~ ~~Revenues~~ ~~and $4.3 million of Adjusted OIBDA. In the nine months ended September 30, 2020,~~ ~~Other~~ ~~generated $66.5~~$13.8 million of Revenues and an Adjusted OIBDA loss of ~~$1.7~~$2.0 million. In the ~~nine~~three months ended ~~September 30, 2019,~~March 31, 2020, Other generated ~~$113.4~~$30.6 million of Revenues and ~~$14.3 million~~Adjusted OIBDA of ~~Adjusted OIBDA.~~$0.0 million.

COVID-19 Impact

The novel coronavirus ~~(COVID-19)~~(“COVID-19”) pandemic and the related preventative measures taken to help curb the spread, including shutdowns and slowdowns of, and restrictions on, businesses, public gatherings, social interactions and travel (including reductions in foot traffic, roadway traffic, commuting, transit ~~commuting~~ridership and overall target audiences) throughout the markets in which we do business have had, and may continue to have, a significant impact on the global economy and our business. Though generally we remain able to continue to sell and service our displays, governmental restrictions have eased in several of our ~~business operates~~markets and several of our markets have commenced their economic recoveries, our billboard and transit ~~franchise agreements~~businesses in many of the top DMAs, such as New York and Los Angeles, ~~where~~are still experiencing the significant impacts of the COVID-19 pandemic. In 2021, the COVID-19 pandemic ~~has had a particularly significant impact. The COVID-19 pandemic has~~may continue to, among other things, (i) ~~delayed our ability to build and deploy advertising structures and sites, including digital displays; (ii) reduced~~reduce or ~~curtailed~~curtail our customers’ advertising expenditures and overall demand for our services through purchase cancellations or otherwise; ~~(iii) increased~~(ii) increase the volatility of our customers’ advertising expenditure patterns from period-to-period through short-notice purchases, purchase deferrals or otherwise; and ~~(iv) extended~~(iii) extend delays in the collection of certain earned advertising revenues from our customers, all of which could have a material adverse effect on our business, financial condition and results of operation in ~~2020.~~2021.

As a result of the impact of the ongoing COVID-19 pandemic on our business and results of operations, we expect our key performance indicators and total revenues ~~and total expenses~~ to incrementally improve throughout the remainder of 2021 as compared to 2020, but be materially lower in 2021 than pre-COVID-19 pandemic levels, particularly in our U.S. Media segment and with respect to our transit and other business. We expect total expenses to increase throughout the remainder of 2021 as compared to 2020, but be materially lower than ~~historical~~pre-COVID-19 pandemic levels, particularly in our U.S. Media segment and with respect to our transit and other business. Additionally, we expect ~~transit franchise expenses,~~ billboard property lease expenses, such as rental expenses, and posting, maintenance and other expenses, ~~such as rental expenses and transit franchise payments, to materially increase~~ as a percentage of revenues, ~~more~~to decrease throughout the remainder of 2021 as compared to 2020, but be materially higher than ~~historical levels, as revenues decline in 2020.~~pre-COVID-19 pandemic levels. We expect transit franchise expenses, such as transit franchise payments, as a percentage of revenues, to increase throughout the remainder of 2021 as compared to 2020, and be materially higher than pre-COVID-19 pandemic levels, primarily due to our guaranteed minimum annual payment amounts owed to the MTA, which resumed on January 1, 2021. The impacts described above with respect to be2020 were greatest in the second quarter of 2020, with incremental improvement in the third and fourth quarters of 2020. Accordingly, results for the three ~~and nine~~ months ended ~~September 30, 2020,~~March 31, 2021, are not indicative of the results that may be expected for the fiscal year ending December 31, ~~2020.~~2021.

~~In response to~~Throughout the ongoing COVID-19 pandemic, we have prioritized the health and safety of our employees and customers by (i) shifting to a secure remote workforce for ~~all~~ personnel other than operations personnel who service our displays and certain other personnel, (ii) implementing deep cleaning, social distancing and other protective policies and practices in accordance with federal, state and local regulations and guidance across all offices and facilities that are open or in the process of reopening, (iii) restricting non-essential business travel, and (iv) communicating frequently with our employees and customers to address any concerns. None of these actions have caused a significant disruption in our ability to manage the continuity of our business or our internal controls. In addition, in order to preserve financial flexibility, increase liquidity and reduce expenses in light of the current uncertainty in the global economy and our business, we ~~have~~ modified our business goals and ~~undertaken~~undertook several actions to date, including, among other things, issuing the ~~following actions, which should be read in conjunction with the “—Analysis of Results of Operations” and “—Liquidity and Capital Resources” sections of this MD&A:~~

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

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

•~~Amended~~certain senior unsecured notes; amending the Credit Agreement (as defined below) to modify the calculation of the Company’s financial maintenance covenant ratio under the Credit Agreement;

•Amended the agreements governing the AR Securitization Facilities (as defined below) to temporarily suspend the AR Facility (as defined below) and extend the Repurchase Facility (as defined below) to June 2021 with a borrowing capacity of $80.0 million, unless further amended and/or extended;

•~~Suspended~~ suspending our quarterly dividend payments on our common stock, subject to the minimum annual REIT distribution ~~requirement;~~requirement (which may be satisfied by making distributions to our common stockholders, our

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preferred stockholders (including holders of Series A Preferred Stock) or a combination of our stockholders); and reducing SG&A (as defined below) and posting, maintenance and other expenses.

•~~Suspended or delayed our deployment of digital transit displays~~We will continue in 2021 to ~~reduce~~focus on managing costs ~~that may or may not be recoverable from customer sales or transit franchise partners;~~

•~~Reduced maintenance~~and expenses to offset any decreases in revenues in 2021 as compared to pre-COVID-19 pandemic levels. However, we have resumed capital ~~expenditures (other than for necessary safety-related projects) and growth capital expenditures for digital billboard display conversions;~~

•~~Have taken~~investments in a measured manner, including taking a highly selective approach to new acquisition ~~activity; and~~

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

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

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

We continue to monitor the ~~rapidly~~ evolving situation and guidance from federal, state and local public health authorities and may take additional actions based on their recommendations. When the COVID-19 pandemic subsides, there can be no assurances as to the time it may take to generate revenues at ~~historic~~pre-COVID-19 pandemic levels. ~~Given the~~There remains uncertainty around the severity and duration of the COVID-19 pandemic and the measures taken, or may be taken, in response to the COVID-19 pandemic, which will depend on numerous factors, including, among others, the emergence of new cases of COVID-19 or its variants, hospitalization and mortality rates, and the availability and distribution of safe and effective treatments and vaccines. Accordingly, the Company cannot reasonably estimate the full impact of the COVID-19 pandemic on our business, financial condition and results of operations at this time, which may be material.

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 the COVID-19 pandemic as described above.

Business Environment

The outdoor advertising industry is fragmented, consisting of several companies operating on a national basis, as well as hundreds of smaller regional and local companies operating a limited number of displays in a single or a few local geographic markets. We compete with these companies for both customers and structure and display locations. We also compete with other media, including online, mobile and social media advertising platforms and traditional advertising platforms (such as television, radio, print and direct mail marketers). In addition, we compete with a wide variety of out-of-home media, including advertising in shopping centers, airports, movie theaters supermarkets and taxis.

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Increasing the number of digital displays in our prime audience locations is an important element of our organic growth strategy, as digital displays have the potential to attract additional business from both new and existing customers. We believe digital displays are attractive to our customers because they allow for the development of richer and more visually engaging messages, provide our customers with the flexibility both to target audiences by time of day and to quickly launch new advertising campaigns, and eliminate or greatly reduce print production and installation costs. In addition, digital displays enable us to run multiple advertisements on each display. Digital billboard displays generate approximately four times more revenue per display on average than traditional static billboard displays. Digital billboard displays also incur, on average, approximately two to four times more costs, including higher variable costs associated with the increase in revenue than traditional static billboard displays. As a result, digital billboard displays generate higher profits and cash flows than traditional static billboard displays. The majority of our digital billboard displays were converted from traditional static billboard displays.

In 2017, we commenced deployment of state-of-the-art digital transit displays in connection with several transit franchises and are planning to increase deployments ~~significantly~~ over the coming years. Once the digital transit displays have been deployed at scale, we expect that revenue generated on digital transit displays will be a multiple of the revenue generated on comparable static transit displays. Subject to the impact of the COVID-19 pandemic, we intend to incur significant equipment deployment costs and capital expenditures in the coming years to continue increasing the number of digital displays in our portfolio.

We have built or converted 4717 new digital billboard displays in the ~~United States and 2 in Canada~~U.S. during the ~~nine~~three months ended ~~September 30, 2020.~~March 31, 2021. Additionally, in the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, we entered into marketing arrangements to sell advertising on 20six third-party digital billboard displays in the U.S. ~~and 29 in Canada.~~ In the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, we have built, converted or replaced ~~1,699~~

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271 digital transit and other displays in the ~~United States. As described above, as a result of the COVID-19 pandemic, we reduced our digital billboard display conversions~~U.S. and ~~suspended or delayed our deployment of~~three digital transit ~~displays.~~and other displays in Canada. The following table sets forth information regarding our digital displays.


		Digital Revenues (in millions) for the Nine Months Ended September 30, 2020(a)						Number of Digital Displays as of September 30, 2020(a)			Digital Revenues (in millions) for the Three Months Ended March 31, 2021(a)						Number of Digital Displays as of March 31, 2021(a)
Location	Location	Digital Billboard		Digital Transit and Other		Total Digital Revenues		Digital Billboard Displays	Digital Transit and Other Displays	Total Digital Displays		Location	Digital Billboard		Digital Transit and Other		Total Digital Revenues		Digital Billboard Displays	Digital Transit and Other Displays	Total Digital Displays
United States	United States	$	130.0	$	41.8	$	171.8	1,200	7,766	8,966		United States	$	45.1	$	6.3	$	51.4	1,258	9,171	10,429
Canada	Canada	12.9		0.1		13.0		219	93	312		Canada	4.2		0.1		4.3		222	108	330
Total	Total	$	142.9	$	41.9	$	184.8	1,419	7,859	9,278		Total	$	49.3	$	6.4	$	55.7	1,480	9,279	10,759

(a)Digital display amounts include ~~2,941~~3,293 displays reserved for transit agency use. Our number of digital displays is impacted by acquisitions, dispositions, management agreements, the net effect of new and lost billboards, and the net effect of won and lost franchises in the period.

Our revenues and profits may fluctuate due to seasonal advertising patterns and influences on advertising markets. Typically, our revenues and profits are highest in the fourth quarter, during the holiday shopping season, and lowest in the first quarter, as advertisers adjust their spending following the holiday shopping season. As described above, our revenues and profits may also fluctuate due to external events beyond our control, such as the COVID-19 pandemic.

We have a diversified base of customers across various industries. During the three months ended ~~September 30, 2020,~~March 31, 2021, our largest categories of advertisers were professional services, healthcare/pharmaceuticals and retail, each of which represented approximately ~~11%~~13%, 9% and 8% of our total U.S. Media segment revenues, respectively. During the three months ended ~~September 30, 2019, our largest categories of advertisers were financial services, retail and professional services, each of which represented approximately 8% of our total~~ ~~U.S. Media~~ ~~segment revenues. During the nine months ended September 30,~~March 31, 2020, our largest categories of advertisers were professional services, ~~healthcare/pharmaceuticals~~computers/internet and retail, each of which represented approximately 10%, 9% and 8%9% of our total U.S. Media segment revenues, respectively. During the nine months ended September 30, 2019, our largest categories of advertisers were retail, professional services and computers/internet, each of which represented approximately 8% of our total ~~U.S. Media~~ ~~segment revenues.~~

Our large-scale portfolio allows our customers to reach a national audience and also provides the flexibility to tailor campaigns to specific regions or markets. In the three months ended ~~September 30, 2020,~~March 31, 2021, we generated approximately 38% of our U.S. Media segment revenues from national advertising campaigns compared to approximately ~~46% in the same prior-year period. In the nine months ended September 30, 2020, we generated approximately 40% of our~~ ~~U.S. Media~~ ~~segment revenues from national advertising campaigns compared to approximately 44%~~43% in the same prior-year period.

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Our transit businesses ~~requires~~require us to periodically obtain and renew contracts with municipalities and other governmental entities. When these contracts expire, we generally must participate in highly competitive bidding processes in order to obtain or renew contracts.

Key Performance Indicators

Our management reviews our performance by focusing on the indicators described below.

Several of our key performance indicators are not prepared in conformity with Generally Accepted Accounting Principles in the United States of America (“GAAP”). 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 Nine Months Ended
September 30, % September 30, %
(in millions, except percentages) 2020 2019 Change 2020 2019 Change
Revenues $ 282.3 $ 462.5 (39) % $ 900.5 $ 1,294.1 (30) %
Organic revenues(a)(b)
282.3 451.1 (37) 874.9 1,252.7 (30)
Operating income 25.1 85.5 (71) 33.0 211.1 (84)
Adjusted OIBDA(b)
68.5 140.3 (51) 177.0 370.7 (52)
Adjusted OIBDA(b) margin
24 % 30 % 20 % 29 %
Funds from operations (“FFO”)(b) attributable to OUTFRONT Media Inc.
22.6 79.0 (71) 39.4 211.7 (81)
Adjusted FFO (“AFFO”)(b) attributable to OUTFRONT Media Inc.
27.7 92.6 (70) 46.4 228.1 (80)
Net income (loss) attributable to OUTFRONT Media Inc. (13.5) 38.7 * (65.3) 95.1 *

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	Three Months Ended
	March 31,				%
(in millions, except percentages)		2021			2020			Change
Revenues		$	259.2		$	385.3		(33)	%
Organic revenues(a)(b)		259.2			372.1			(30)
Operating income (loss)		(31.0)			33.8			*
Adjusted OIBDA(b)(c)		11.1			75.5			(85)
Adjusted OIBDA(b)(c) margin		4		%	20		%
Funds from operations (“FFO”)(b) attributable to OUTFRONT Media Inc.		(30.4)			44.7			*
Adjusted FFO (“AFFO”)(b) attributable to OUTFRONT Media Inc.		(24.5)			40.0			*
Net income (loss) attributable to OUTFRONT Media Inc.		(67.7)			6.1			*

•*Calculation is not meaningful.

(a)Organic revenues exclude revenues associated with a disposition and the impact of foreign currency exchange rates (“non-organic revenues”). We provide organic revenues to understand the underlying growth rate of revenue excluding the impact of non-organic revenue items. Our management believes organic revenues are useful to users of our financial data because it enables them to better understand the level of growth of our business period to period. Since organic revenues are not calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, revenues as an indicator of operating performance. 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 (loss) to Adjusted OIBDA, Net income (loss) attributable to OUTFRONT Media Inc. to FFO attributable to OUTFRONT Media Inc. and AFFO attributable to OUTFRONT Media Inc. and Revenues to organic revenues.

(c)Consistent with the current year’s presentation, we have reclassified amortization of direct lease acquisition costs of $11.3 million in the three months ended March 31, 2020, from Amortization to Selling, general and administrative expenses, resulting in a corresponding decrease in Adjusted OIBDA.

Adjusted OIBDA

We calculate Adjusted OIBDA as operating income (loss) before depreciation, amortization, net (gain) loss on dispositions, stock-based compensation and restructuring charges. We calculate Adjusted OIBDA margin by dividing Adjusted OIBDA by total revenues. Adjusted OIBDA and Adjusted OIBDA margin are among the primary measures we use for managing our business, evaluating our operating performance and planning and forecasting future periods, as each is an important indicator of our operational strength and business performance. Our management believes users of our financial data are best served if the information that is made available to them allows them to align their analysis and evaluation of our operating results along the same lines that our management uses in managing, planning and executing our business strategy. Our management also believes that the presentations of Adjusted OIBDA and Adjusted OIBDA margin, as supplemental measures, are useful in evaluating our business because eliminating certain non-comparable items highlight operational trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures. It is management’s opinion that these supplemental measures provide users of our financial data with an important perspective on our operating performance and also make it easier for users of our financial data to compare our results with other companies that have different financing and capital structures or tax rates.

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FFO and AFFO

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”). FFO reflects net income (loss) attributable to OUTFRONT Media Inc. adjusted to exclude gains and losses from the sale of real estate assets, depreciation and amortization of real estate assets, amortization of direct lease acquisition costs and the same adjustments for our equity-based investments and non-controlling interests, as well as the related income tax effect of adjustments, as applicable. We calculate AFFO as FFO adjusted to include cash paid for direct lease acquisition costs as such costs are generally amortized over a period ranging from four weeks to one year and therefore are incurred on a regular basis. AFFO also includes cash paid for maintenance capital expenditures since these are routine uses of cash that are necessary for our operations. In addition, AFFO excludes restructuring charges and losses on extinguishment of debt, as well as certain non-cash items, including non-real estate depreciation and amortization, ~~a gain on disposition of non-real estate assets,~~ stock-based compensation expense, accretion expense, the non-cash effect of straight-line rent, amortization of deferred financing costs and the same adjustments for our non-controlling interests, as well as the non-cash portion of income taxes, and the related income tax effect of adjustments, as applicable. We use FFO and AFFO measures for managing our business and for planning and forecasting future periods, and each is an important indicator of our operational strength and business performance, especially compared to other REITs. Our management believes users of our financial data are best served

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if the information that is made available to them allows them to align their analysis and evaluation of our operating results along the same lines that our management uses in managing, planning and executing our business strategy. Our management also believes that the presentations of FFO and AFFO, as supplemental measures, are useful in evaluating our business because adjusting results to reflect items that have more bearing on the operating performance of REITs highlight trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures. It is management’s opinion that these supplemental measures provide users of our financial data with an important perspective on our operating performance and also make it easier to compare our results to other companies in our industry, as well as to REITs.

Since Adjusted OIBDA, Adjusted OIBDA margin, FFO and AFFO are not measures calculated in accordance with GAAP, they should not be considered in isolation of, or as a substitute for, operating income (loss), net income (loss) attributable to OUTFRONT Media Inc., and revenues, the most directly comparable GAAP financial measures, as indicators of operating performance. These measures, as we calculate them, may not be comparable to similarly titled measures employed by other companies. 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.

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Reconciliation of Non-GAAP Financial Measures

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


		Three Months Ended						Nine Months Ended							Three Months Ended
		September 30,						September 30,							March 31,
(in millions, except per share amounts)	(in millions, except per share amounts)	2020			2019			2020			2019			(in millions, except per share amounts)		2021			2020
Total revenues	Total revenues	$	282.3		$	462.5		$	900.5		$	1,294.1		Total revenues		$	259.2		$	385.3

Operating income		$	25.1		$	85.5		$	33.0		$	211.1
Restructuring charges(a)		0.6			—			5.3			0.3
Operating income (loss)														Operating income (loss)		$	(31.0)		$	33.8

Net gain on dispositions	Net gain on dispositions	(8.0)			(1.9)			(13.3)			(3.0)			Net gain on dispositions		(0.3)			(0.1)
Depreciation	Depreciation	21.0			22.4			63.2			64.9			Depreciation		20.0			21.0
Amortization(a)	Amortization(a)	24.4			28.7			72.4			81.0			Amortization(a)		16.4			15.0
Stock-based compensation	Stock-based compensation	5.4			5.6			16.4			16.4			Stock-based compensation		6.0			5.8
Adjusted OIBDA(a)	Adjusted OIBDA(a)	$	68.5		$	140.3		$	177.0		$	370.7		Adjusted OIBDA(a)		$	11.1		$	75.5
Adjusted OIBDA margin		24		%	30		%	20		%	29		%
Adjusted OIBDA(a) margin														Adjusted OIBDA(a) margin		4		%	20		%

Net income (loss) attributable to OUTFRONT Media Inc.	Net income (loss) attributable to OUTFRONT Media Inc.	$	(13.5)		$	38.7		$	(65.3)		$	95.1		Net income (loss) attributable to OUTFRONT Media Inc.		$	(67.7)		$	6.1
Depreciation of billboard advertising structures	Depreciation of billboard advertising structures	15.3			17.0			46.2			49.2			Depreciation of billboard advertising structures		14.1			15.5
Amortization of real estate-related intangible assets	Amortization of real estate-related intangible assets	12.3			11.6			36.5			33.4			Amortization of real estate-related intangible assets		12.4			12.0
Amortization of direct lease acquisition costs	Amortization of direct lease acquisition costs	9.1			13.6			26.7			36.9			Amortization of direct lease acquisition costs		11.2			11.3
Net gain on disposition of real estate assets	Net gain on disposition of real estate assets	(0.8)			(1.9)			(6.1)			(3.0)			Net gain on disposition of real estate assets		(0.3)			(0.1)

Adjustment related to non-controlling interests	Adjustment related to non-controlling interests	—			—			(0.2)			—			Adjustment related to non-controlling interests		(0.1)			(0.1)
Adjustment related to equity-based investments		—			—			—			0.1
Income tax effect of adjustments(b)		0.2			—			1.6			—

FFO attributable to OUTFRONT Media Inc.	FFO attributable to OUTFRONT Media Inc.	22.6			79.0			39.4			211.7			FFO attributable to OUTFRONT Media Inc.		(30.4)			44.7
Non-cash portion of income taxes	Non-cash portion of income taxes	(1.1)			0.7			(6.4)			0.6			Non-cash portion of income taxes		(5.2)			(2.5)
Cash paid for direct lease acquisition costs	Cash paid for direct lease acquisition costs	(9.0)			(10.5)			(32.6)			(34.5)			Cash paid for direct lease acquisition costs		(12.1)			(14.9)
Maintenance capital expenditures	Maintenance capital expenditures	(2.9)			(6.4)			(14.0)			(15.0)			Maintenance capital expenditures		(3.6)			(4.8)
Restructuring charges - severance(a)		0.6			—			4.4			0.3

Other depreciation	Other depreciation	5.7			5.4			17.0			15.7			Other depreciation		5.9			5.5
Other amortization	Other amortization	3.0			3.5			9.2			10.7			Other amortization		4.0			3.0
Gain on disposition of non-real estate assets(c)		(7.2)			—			(7.2)			—
Stock-based compensation(a)		5.4			5.6			17.3			16.4

Stock-based compensation														Stock-based compensation		6.0			5.8
Non-cash effect of straight-line rent	Non-cash effect of straight-line rent	4.7			1.8			9.6			4.4			Non-cash effect of straight-line rent		2.0			1.3
Accretion expense	Accretion expense	0.6			0.6			1.9			1.9			Accretion expense		0.7			0.6
Amortization of deferred financing costs	Amortization of deferred financing costs	1.8			1.9			4.8			4.9			Amortization of deferred financing costs		1.9			1.3
Loss on extinguishment of debt	Loss on extinguishment of debt	—			11.0			—			11.0			Loss on extinguishment of debt		6.3			—
Adjustment related to non-controlling interests		—			—			(0.1)			—
Income tax effect of adjustments(d)		3.5			—			3.1			—

AFFO attributable to OUTFRONT Media Inc.	AFFO attributable to OUTFRONT Media Inc.	$	27.7		$	92.6		$	46.4		$	228.1		AFFO attributable to OUTFRONT Media Inc.		$	(24.5)		$	40.0

(a)InConsistent with the current year’s presentation, we have reclassified amortization of direct lease acquisition costs of $11.3 million in the three months ended March 31, 2020, from ~~Restructuring charges~~ ~~relate to severance associated with workforce reductions made in response to the COVID-19 pandemic and includes stock-based compensation expenses of $0.9 million.~~

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

~~(c)Gain related to the Sports Disposition. (See Note 13.~~ ~~Acquisitions and Dispositions~~: ~~Dispositions~~Amortization to ~~the Consolidated Financial Statements.)~~

~~(d)Income tax effect related to Restructuring charges - severance~~Selling, general and ~~Gain on disposition of non-real estate assets.~~administrative expenses, resulting in a corresponding decrease in Adjusted OIBDA.

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FFO in the three months ended ~~September 30, 2020,~~March 31, 2021, was a deficit of ~~$22.6~~$30.4 million ~~decreased $56.4~~compared to FFO of $44.7 million ~~or 71%, compared to~~in the same prior-year period. AFFO in the three months ended ~~September 30, 2020,~~March 31, 2021, was a deficit of ~~$27.7~~$24.5 million ~~decreased $64.9~~compared AFFO of $40.0 million ~~or 70%, compared to the same prior-year period. FFO~~ in ~~the nine months ended September 30, 2020, of $39.4 million decreased $172.3 million, or 81%, compared to the same prior-year period. AFFOin the nine months ended September 30, 2020, of $46.4 million decreased $181.7 million, or 80%, compared to~~ the same prior-year period. The decreases were primarily due to the impact of the COVID-19 pandemic on revenues, partially offset by cost reduction measures taken in response to the COVID-19 pandemic.

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Analysis of Results of Operations

Revenues

We derive Revenues primarily from providing advertising space to customers on our advertising structures and sites. Our contracts with customers generally cover periods ranging from four weeks to one year. Revenues from billboard displays are recognized as rental income on a straight-line basis over the contract term. Transit and other revenues are recognized over the contract period. (See Note 11. Revenues to the Consolidated Financial Statements.)


		Three Months Ended						Nine Months Ended							Three Months Ended
		September 30,				%		September 30,				%			March 31,			%
(in millions, except percentages)	(in millions, except percentages)	2020		2019		Change		2020		2019		Change		(in millions, except percentages)		2021		2020		Change
Revenues:	Revenues:													Revenues:
Billboard	Billboard	$	239.9	$	312.0	(23)	%	$	699.3	$	868.8	(20)	%	Billboard		$	223.6	$	270.9	(17)	%
Transit and other	Transit and other	42.4		150.5		(72)		201.2		$	425.3	(53)		Transit and other		35.6		114.4		(69)
Total revenues	Total revenues	$	282.3	$	462.5	(39)		$	900.5	$	1,294.1	(30)		Total revenues		$	259.2	$	385.3	(33)

Organic revenues(a):	Organic revenues(a):													Organic revenues(a):
Billboard	Billboard	$	239.9	$	311.7	(23)		$	699.3	$	867.7	(19)		Billboard		$	223.6	$	271.7	(18)
Transit and other	Transit and other	42.4		139.4		(70)		175.6		385.0		(54)		Transit and other		35.6		100.4		(65)
Total organic revenues(a)	Total organic revenues(a)	282.3		451.1		(37)		874.9		1,252.7		(30)		Total organic revenues(a)		259.2		372.1		(30)
Non-organic revenues:	Non-organic revenues:													Non-organic revenues:
Billboard	Billboard	—		0.3		*		—		1.1		*		Billboard		—		(0.8)		*
Transit and other	Transit and other	—		11.1		*		25.6		40.3		(36)		Transit and other		—		14.0		*
Total non-organic revenues	Total non-organic revenues	—		11.4		*		25.6		41.4		(38)		Total non-organic revenues		—		13.2		*
Total revenues	Total revenues	$	282.3	$	462.5	(39)		$	900.5	$	1,294.1	(30)		Total revenues		$	259.2	$	385.3	(33)

•*Calculation is not meaningful.

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

Total revenues decreased ~~$180.2~~by $126.1 million, or ~~39%~~33%, and organic revenues decreased ~~$168.8~~$112.9 million, or ~~37%~~30%, in the three months ended September 30, 2020, compared to the same prior-year period. Total revenues decreased by $393.6 million, or 30%, and organic revenues decreased $377.8 million, or 30%, in the nine months ended September 30, 2020,March 31, 2021, compared to the same prior-year period.

In the ~~nine~~three months ended ~~September 30,~~March 31, 2020, ~~non-organic revenues exclude the impact of the Sports Disposition. In the three and nine months ended September 30, 2019,~~ non-organic revenues exclude the impact of the Sports Disposition and reflect the impact of foreign currency exchange rates.

Total billboard revenues decreased ~~$72.1~~$47.3 million, or ~~23%~~17%, in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year period, principally driven by a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services.

Organic billboard revenues decreased ~~$169.5~~$48.1 million, or ~~20%~~18%, in the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year ~~period. The decreases were~~period, principally driven by a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services.

Total transit and other revenues decreased $78.8 million, or 69%, in the three months ended March 31, 2021, compared to the same prior-year period, principally driven by a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services, ~~through purchase cancellations or otherwise.~~and the impact of the Sports Disposition.

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

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

~~Total~~ transit and other revenues decreased ~~$108.1~~$64.8 million, or ~~72%~~65%, in the three months ended September 30, 2020, compared to the same prior-year period and decreased $224.1 million, or 53%, in the nine months ended September 30, 2020, compared to the same prior-year period. The decreases were driven by a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise, the impact of the Sports Disposition and a decrease in third-party digital equipment sales.

~~The decrease in organic transit and other revenues in each of the three and nine months ended September 30, 2020,~~March 31, 2021, compared to the same prior-year period, is due to a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our ~~services through purchase cancellations or otherwise and a decrease in third-party digital equipment sales.~~services.

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Expenses


		Three Months Ended						Nine Months Ended							Three Months Ended
		September 30,				%		September 30,				%			March 31,			%
(in millions, except percentages)	(in millions, except percentages)	2020		2019		Change		2020		2019		Change		(in millions, except percentages)		2021		2020		Change
Expenses:	Expenses:													Expenses:
Operating	Operating	$	155.8	$	245.5	(37)	%	$	534.6	$	702.7	(24)	%	Operating		$	177.6	$	224.8	(21)	%
Selling, general and administrative(a)	Selling, general and administrative(a)	63.4		82.3		(23)		205.3		237.1		(13)		Selling, general and administrative(a)		76.5		90.8		(16)
Restructuring charges		0.6		—		*		5.3		0.3		*

Net gain on dispositions	Net gain on dispositions	(8.0)		(1.9)		*		(13.3)		(3.0)		*		Net gain on dispositions		(0.3)		(0.1)		*
Depreciation	Depreciation	21.0		22.4		(6)		63.2		64.9		(3)		Depreciation		20.0		21.0		(5)
Amortization(a)	Amortization(a)	24.4		28.7		(15)		72.4		81.0		(11)		Amortization(a)		16.4		15.0		9
Total expenses	Total expenses	$	257.2	$	377.0	(32)		$	867.5	$	1,083.0	(20)		Total expenses		$	290.2	$	351.5	(17)

*Calculation is not meaningful.

(a)Consistent with the current year’s presentation, we have reclassified amortization of direct lease acquisition costs of $11.3 million in three months ended March 31, 2020, from Amortization to Selling, general and administrative expenses.

Operating Expenses


		Three Months Ended						Nine Months Ended							Three Months Ended
		September 30,				%		September 30,				%			March 31,			%
(in millions, except percentages)	(in millions, except percentages)	2020		2019		Change		2020		2019		Change		(in millions, except percentages)		2021		2020		Change
Operating expenses:	Operating expenses:													Operating expenses:
Billboard property lease	Billboard property lease	$	95.0	$	104.5	(9)	%	$	291.9	$	302.2	(3)	%	Billboard property lease		$	94.1	$	102.8	(8)	%
Transit franchise	Transit franchise	21.3		69.8		(69)		97.6		201.5		(52)		Transit franchise		39.6		57.8		(31)
Posting, maintenance and other	Posting, maintenance and other	39.5		71.2		(45)		145.1		199.0		(27)		Posting, maintenance and other		43.9		64.2		(32)
Total operating expenses	Total operating expenses	$	155.8	$	245.5	(37)		$	534.6	$	702.7	(24)		Total operating expenses		$	177.6	$	224.8	(21)

Billboard property lease expenses represented ~~40%~~42% of billboard revenues in the three months ended ~~September 30, 2020, 33%~~March 31, 2021, and 38% in the three months ended ~~September 30, 2019, 42% in the nine months ended September 30, 2020, and 35% in the nine months ended September 30, 2019.~~March 31, 2020.

Transit franchise expenses represented ~~59%~~131% of transit display revenues in the three months ended ~~September 30, 2020, 57%~~March 31, 2021 and 62% in the three months ended ~~September 30, 2019, 62% in the nine months ended September 30, 2020 and 59% in the nine months ended September 30, 2019.~~March 31, 2020. The increase in transit franchise expense as a percentage of revenues is primarily driven by ~~an amendment~~guaranteed minimum annual payments to ~~our agreement with~~ the New York Metropolitan Transportation Authority ~~(“the MTA”~~(the “MTA”)~~, which resulted in the payment of an increased revenue share percentage instead of guaranteed minimum annual payments for second and third quarters of 2020.~~.

Billboard property lease and transit franchise expenses decreased ~~$58.0~~$26.9 million in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year ~~period. Billboard property lease and transit franchise expenses decreased $114.2 million in the~~

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~~nine months ended September 30, 2020, compared to the same prior-year period. The decreases were~~period, due primarily to lower billboard and transit revenues resulting from the impact of the COVID-19 pandemic and the impact of agreements with landlords and transit franchise partners to modify our existing minimum lease payments and guaranteed minimum annual payments to revenue share ~~percentages in the second and third quarters of 2020.~~percentages.

Posting, maintenance and other expenses decreased ~~$31.7~~$20.3 million, or ~~45%~~32%, in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year period, ~~and decreased $53.9 million, or 27%, in the nine months ended September 30, 2020, compared to the same prior-year period. The decreases were~~ primarily due to the impact of the COVID-19 pandemic and the related restrictions in the top DMAs reducing or curtailing customer advertising expenditures and overall demand for our services, ~~through purchase cancellations or otherwise,~~and the impact of the Sports ~~Disposition and lower costs related to third-party digital equipment sales.~~Disposition.

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

SG&A expenses represented ~~22%~~30% of Revenues in the three months ended ~~September 30, 2020,~~March 31, 2021 and ~~18%~~24% in the same prior-year period. SG&A expenses decreased ~~$18.9~~$14.3 million, or ~~23%~~16%, in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year ~~period. SG&A expenses represented 23% of~~ ~~Revenues~~ in the nine months ended September 30, 2020 and 18% in the same prior-year period. SG&A expenses decreased $31.8 million, or 13%, in the nine months ended September 30, 2020, compared to the same prior-year period. The decreases wereperiod, primarily driven by a lower ~~compensation-related costs and lower professional fees, primarily as a result of cost reduction measures taken in response to the COVID-19 pandemic,~~provision for doubtful allowances and lower expenses resulting from the Sports ~~Disposition, partially offset by a higher provision for doubtful allowances.~~Disposition. Consistent with the current year’s presentation, we have reclassified amortization of direct lease acquisition costs of $11.3 million in three months ended March 31, 2020 from Amortization to Selling, general and administrative expenses.

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Net Gain on Dispositions

Net gain on dispositions was ~~$8.0~~$0.3 million for the three months ended ~~September 30, 2020,~~March 31, 2021, compared to ~~$1.9~~$0.1 million for the same prior-year period.~~Net gain on dispositions~~ was $13.3 million for the nine months ended September 30, 2020, compared to $3.0 million for the same prior-year period. The gain for the three and nine months ended September 30, 2020, was primarily related to a gain of $7.2 million related to the Sports Disposition. For the nine months ended September 30, 2020, the gain also included the sale of an office location in Canada in the second quarter of 2020. The gains for the nine months ended September 30, 2019, primarily related to the sales of office locations in the U.S.

Depreciation

Depreciation decreased ~~$1.4~~$1.0 million, or 6%5%, in the three months ended ~~September 30, 2020, compared to the same prior-year period and decreased $1.7 million, or 3%, in the nine months ended September 30, 2020,~~March 31, 2021, compared to the same prior-year period.

Amortization

Amortization ~~decreased $4.3~~increased $1.4 million, or ~~15%~~9%, in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year period, principally driven by ~~lower direct lease acquisition costs, partially offset by~~ higher amortization of intangible assets. ~~Amortization~~Consistent with the current year’s presentation, we have reclassified amortization of direct lease acquisition costs ~~was $9.1~~of $11.3 million in ~~the~~ three months ended ~~September 30,~~March 31, 2020 ~~and $13.6 million in the same prior-year period.~~from Amortization ~~decreased $8.6 million, or 11%, in the nine months ended September 30, 2020, compared~~ to the same prior-year period, principally driven by lower direct lease acquisition costs, partially offset by higher amortization of intangible assets. Amortization of direct lease acquisition costs was $26.7 million in the nine months ended September 30, 2020Selling, general and ~~$36.9 million in the same prior-year period.~~administrative expenses.

Interest Expense, Net

Interest expense, net, was ~~$34.2~~$34.6 million (including ~~$1.8~~$1.9 million of deferred financing costs) in the three months ended ~~September 30, 2020,~~March 31, 2021, and ~~$33.9~~$29.8 million (including ~~$1.9~~$1.3 million of deferred financing costs) in the same prior-year period. The increase in Interest expense, net, ~~in the three months ended September 30, 2020, compared to the same prior-year period~~ was primarily due ~~primarily~~ to a higher outstanding average debt balance, partially offset by lower interest rates.~~Interest expense, net,~~ was $97.3 million (including $4.8 million of deferred financing costs) in the nine months ended September 30, 2020, and $100.5 million (including $4.9 million of deferred financing costs) in the same prior-year period. The decrease in ~~Interest expense, net,~~ ~~in the nine months ended September 30, 2020, compared to the same prior-year period was primarily due to lower interest rates, partially offset by a higher outstanding average debt balance.~~

38Loss on Extinguishment of Debt

~~Table~~

In the first quarter of ~~Contents~~2021, we recorded a loss on extinguishment of debt of $6.3 million relating to the redemption of our 5.625% Senior Unsecured Notes due 2024.

~~Provision~~Benefit for Income Taxes

~~Provision~~Benefit for income taxes ~~of $3.5~~increased $3.0 million, or 176%, in the three months ended ~~September 30, 2020, increased $0.2 million, or 6%,~~March 31, 2021, compared to the same prior-year period, due primarily to a ~~gain related to the Sports Disposition.~~ ~~Provision for income taxes~~ ~~of $0.3 million in the nine months ended September 30, 2020, decreased $8.2 million, or 96%, compared to the same prior-year period, due primarily to a~~higher taxable REIT subsidiary loss in the ~~nine~~three months ended ~~September 30, 2020, partially offset by the gain related~~March 31, 2021 compared to the ~~Sports Disposition.~~same prior-year period.

Net Income (Loss)

Net loss before allocation to non-controlling interests was ~~$13.3~~$67.6 million in the three months ended ~~September 30, 2020, compared to~~ ~~Net income before allocation to non-controlling interests~~ of $38.7 million in the same prior-year period, due primarily to a the impact of the COVID-19 pandemic, partially offset by the impact of cost reduction measures taken in response to the COVID-19 pandemic and the gain related to the Sports Disposition. ~~Net loss before allocation to non-controlling interests~~ ~~was $65.0 million in the nine months ended September 30, 2020,~~March 31, 2021, compared Net income before allocation to non-controlling interests of ~~$95.1~~$6.3 million in the same prior-year period, due primarily to the impact of the COVID-19 pandemic, partially offset by the impact of cost reduction measures taken in response, ~~the gain related to the Sports Disposition~~ and ~~lower~~higher interest expense.

Segment Results of Operations

We present Adjusted OIBDA as the primary measure of profit and loss for our reportable segments. (See the “Key Performance Indicators” section of this MD&A and Note 19. Segment Information to the Consolidated Financial Statements.)

We currently manage our operations through two operating segments—U.S. Billboard and Transit, which is included in our U.S. Media reportable segment, and International. International does not meet the criteria to be a reportable segment and accordingly, is included in Other. Our segment reporting therefore includes U.S. Media and Other.

The following table presents our Revenues, Adjusted OIBDA and Operating income (loss) by segment in the three ~~and nine~~ months ended ~~September 30, 2020~~March 31, 2021 and ~~2019.~~2020. In the third quarter of 2020, we completed the Sports Disposition. Historical operating results for our Sports Marketing operating segment through June 30, 2020, are included in Other.

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		Three Months Ended				Nine Months Ended					Three Months Ended
		September 30,				September 30,					March 31,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)		2021		2020
Revenues:	Revenues:									Revenues:
U.S. Media	U.S. Media	$	265.8	$	422.7	$	834.0	$	1,180.7	U.S. Media		$	245.4	$	354.7
Other	Other	16.5		39.8		66.5		113.4		Other		13.8		30.6
Total revenues	Total revenues	$	282.3	$	462.5	$	900.5	$	1,294.1	Total revenues		$	259.2	$	385.3

Operating income		$	25.1	$	85.5	$	33.0	$	211.1
Restructuring charges		0.6		—		5.3		0.3
Operating income (loss)										Operating income (loss)		$	(31.0)	$	33.8

Net gain on dispositions	Net gain on dispositions	(8.0)		(1.9)		(13.3)		(3.0)		Net gain on dispositions		(0.3)		(0.1)
Depreciation	Depreciation	21.0		22.4		63.2		64.9		Depreciation		20.0		21.0
Amortization(a)	Amortization(a)	24.4		28.7		72.4		81.0		Amortization(a)		16.4		15.0
Stock-based compensation(b)	Stock-based compensation(b)	5.4		5.6		16.4		16.4		Stock-based compensation(b)		6.0		5.8
Total Adjusted OIBDA		$	68.5	$	140.3	$	177.0	$	370.7
Total Adjusted OIBDA(a)										Total Adjusted OIBDA(a)		$	11.1	$	75.5

Adjusted OIBDA:	Adjusted OIBDA:									Adjusted OIBDA:
U.S. Media		$	74.2	$	147.3	$	202.4	$	387.7
Other		3.2		4.3		(1.7)		14.3
U.S. Media(a)										U.S. Media(a)		$	24.6	$	80.0
Other(a)										Other(a)		(2.0)		—
Corporate	Corporate	(8.9)		(11.3)		(23.7)		(31.3)		Corporate		(11.5)		(4.5)
Total Adjusted OIBDA		$	68.5	$	140.3	$	177.0	$	370.7
Total Adjusted OIBDA(a)										Total Adjusted OIBDA(a)		$	11.1	$	75.5

Operating income (loss):	Operating income (loss):									Operating income (loss):
U.S. Media	U.S. Media	$	31.9	$	103.1	$	75.4	$	260.5	U.S. Media		$	(8.6)	$	47.4
Other	Other	7.5		(0.7)		(1.3)		(1.4)		Other		(4.9)		(3.3)
Corporate	Corporate	(14.3)		(16.9)		(41.1)		(48.0)		Corporate		(17.5)		(10.3)
Total operating income		$	25.1	$	85.5	$	33.0	$	211.1
Total operating income (loss)										Total operating income (loss)		$	(31.0)	$	33.8

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

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U.S. Media


		Three Months Ended								Nine Months Ended									Three Months Ended
		September 30,						%		September 30,						%			March 31,				%
(in millions, except percentages)	(in millions, except percentages)	2020			2019			Change		2020			2019			Change		(in millions, except percentages)		2021			2020			Change
Revenues:	Revenues:																	Revenues:
Billboard	Billboard	$	226.0		$	292.8		(23)	%	$	663.9		$	814.1		(18)	%	Billboard		$	212.5		$	256.5		(17)	%
Transit and other	Transit and other	39.8			129.9			(69)		170.1			366.6			(54)		Transit and other		32.9			98.2			(66)

Total revenues	Total revenues	265.8			422.7			(37)		834.0			1,180.7			(29)		Total revenues		245.4			354.7			(31)
Operating expenses	Operating expenses	(145.9)			(218.1)			(33)		(483.6)			(628.8)			(23)		Operating expenses		(166.1)			(202.7)			(18)
SG&A expenses(a)	SG&A expenses(a)	(45.7)			(57.3)			(20)		(148.0)			(164.2)			(10)		SG&A expenses(a)		(54.7)			(72.0)			(24)
Adjusted OIBDA(a)	Adjusted OIBDA(a)	$	74.2		$	147.3		(50)		$	202.4		$	387.7		(48)		Adjusted OIBDA(a)		$	24.6		$	80.0		(69)
Adjusted OIBDA margin		28		%	35		%			24		%	33		%
Adjusted OIBDA(a) margin																		Adjusted OIBDA(a) margin		10		%	23		%

Operating income		$	31.9		$	103.1		(69)		$	75.4		$	260.5		(71)
Restructuring charges		0.4			—			*		3.4			—			*
Operating income (loss)																		Operating income (loss)		$	(8.6)		$	47.4		(118)

Net gain on dispositions	Net gain on dispositions	—			(1.9)			*		(1.2)			(3.2)			(63)		Net gain on dispositions		(0.3)			(0.1)			200
Depreciation and amortization(a)	Depreciation and amortization(a)	41.9			46.1			(9)		124.8			130.4			(4)		Depreciation and amortization(a)		33.5			32.7			2
Adjusted OIBDA(a)	Adjusted OIBDA(a)	$	74.2		$	147.3		(50)		$	202.4		$	387.7		(48)		Adjusted OIBDA(a)		$	24.6		$	80.0		(69)

* Calculation is not meaningful.

(a)Consistent with the current year’s presentation, we have reclassified amortization of direct lease acquisition costs of $10.8 million in the three months ended March 31, 2020, in our U.S. Media segment from Amortization to SG&A expenses, resulting in a corresponding decrease in Adjusted OIBDA.

Total U.S. Media segment revenues decreased ~~$156.9~~$109.3 million, or ~~37%~~31%, in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year ~~period. In the three months ended September 30, 2020, we generated approximately 38% of our~~ ~~U.S. Media~~ ~~segment revenues from national advertising campaigns and 46% in the same prior-year period. Total~~ ~~U.S. Media~~ segment revenues decreased $346.7 million, or 29%, in the nine months ended September 30, 2020, compared to the same prior-year period. In the nine months ended September 30, 2020, we generated approximately 40% of our ~~U.S. Media~~ ~~segment revenues from national advertising campaigns and 44% in the same prior-year period. The decreases in U.S. Media segment revenues were~~period, due primarily to a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our ~~services through purchase cancellations or otherwise.~~services. In the three months ended March 31, 2021, we generated approximately 38% of our U.S. Media segment revenues from national advertising campaigns and 43% in the same prior-year period.

Revenues from U.S. Media segment billboards decreased ~~$66.8~~$44.0 million, or ~~23%~~17%, in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year ~~period. Revenues from~~ ~~U.S. Media~~ ~~segment billboards decreased $150.2 million, or 18%, in the nine months ended September 30, 2020, compared to the same prior-year period. The decreases reflect~~period, reflecting a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our ~~services through purchase cancellations or otherwise.~~services.

Transit and other revenues in the U.S. Media segment decreased ~~$90.1~~$65.3 million, or ~~69%~~66%, in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year period, ~~and decreased $196.5 million, or 54%, in the nine months ended September 30, 2020, compared to the same prior-year period. The decreases were~~ driven by a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our ~~services through purchase cancellations or otherwise.~~services.

U.S. Media segment operating expenses decreased ~~$72.2~~$36.6 million, or ~~33%~~18%, in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year ~~period.~~ ~~U.S. Media~~ ~~segment SG&A expenses decreased $11.6 million, or 20%, in the three months ended September 30, 2020, compared to the same prior-year period.~~ ~~U.S. Media~~ ~~segment operating expenses decreased $145.2 million, or 23%, in the nine months ended September 30, 2020, compared to the same prior-year period.~~ ~~U.S. Media~~ ~~segment SG&A expenses decreased $16.2 million, or 10%, in the nine months ended September 30, 2020, compared to the same prior-year period. The decreases in~~ ~~U.S. Media~~ ~~segment operating expenses were~~period, primarily driven by lower billboard and transit revenues resulting from the impact of the COVID-19 pandemic and the impact of agreements with landlords and transit franchise partners to modify our existing minimum lease payments and guaranteed minimum annual payments to revenue share ~~percentages in the second and third quarters of 2020. The decreases in~~percentages. U.S. Mediasegment SG&A expenses ~~were~~decreased $17.3 million, or 24%, in the three months ended March 31, 2021, compared to the same prior-year period, primarily

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

U.S. Media segment Adjusted OIBDA decreased ~~$73.1~~$55.4 million, or ~~50%~~69%, in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year period. Adjusted OIBDA margin was ~~28%~~10% in the three months ended ~~September 30, 2020,~~March 31, 2021, and ~~35% in the same prior-year period.~~ ~~U.S. Media~~ segment Adjusted OIBDA decreased $185.3 million, or 48%, in the nine months ended September 30, 2020, compared to the same prior-year period. Adjusted OIBDA margin was 24% in the nine months ended September 30, 2020, and 33%23% in the same prior-year period.

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Other


		Three Months Ended								Nine Months Ended									Three Months Ended
		September 30,						%		September 30,						%			March 31,				%
(in millions, except percentages)	(in millions, except percentages)	2020			2019			Change		2020			2019			Change		(in millions, except percentages)		2021			2020			Change
Revenues:	Revenues:																	Revenues:
Billboard	Billboard	$	13.9		$	19.2		(28)	%	$	35.4		$	54.7		(35)	%	Billboard		$	11.1		$	14.4		(23)	%
Transit and other	Transit and other	2.6			20.6			(87)		31.1			58.7			(47)		Transit and other		2.7			16.2			(83)
Total revenues	Total revenues	$	16.5		$	39.8		(59)		$	66.5		$	113.4		(41)		Total revenues		$	13.8		$	30.6		(55)

Organic revenues(a):	Organic revenues(a):																	Organic revenues(a):
Billboard	Billboard	$	13.9		$	18.9		(26)		$	35.4		$	53.6		(34)		Billboard		$	11.1		$	15.2		(27)
Transit and other	Transit and other	2.6			9.5			(73)		5.5			18.4			(70)		Transit and other		2.7			2.2			23
Total organic revenues(a)	Total organic revenues(a)	16.5			28.4			(42)		40.9			72.0			(43)		Total organic revenues(a)		13.8			17.4			(21)
Non-organic revenues:	Non-organic revenues:																	Non-organic revenues:
Billboard	Billboard	—			0.3			*		—			1.1			*		Billboard		—			(0.8)			*
Transit and other	Transit and other	—			11.1			*		25.6			40.3			(36)		Transit and other		—			14.0			*
Total non-organic revenues	Total non-organic revenues	—			11.4			*		25.6			41.4			(38)		Total non-organic revenues		—			13.2			*
Total revenues	Total revenues	16.5			39.8			(59)		66.5			113.4			(41)		Total revenues		13.8			30.6			(55)
Operating expenses	Operating expenses	(9.9)			(27.4)			(64)		(51.0)			(73.9)			(31)		Operating expenses		(11.5)			(22.1)			(48)
SG&A expenses(b)	SG&A expenses(b)	(3.4)			(8.1)			(58)		(17.2)			(25.2)			(32)		SG&A expenses(b)		(4.3)			(8.5)			(49)
Adjusted OIBDA(b)	Adjusted OIBDA(b)	$	3.2		$	4.3		(26)		$	(1.7)		$	14.3		*		Adjusted OIBDA(b)		$	(2.0)		$	—		*
Adjusted OIBDA margin		19		%	11		%			(3)		%	13		%
Adjusted OIBDA(b) margin																		Adjusted OIBDA(b) margin		(14)		%	—		%

Operating loss	Operating loss	$	7.5		$	(0.7)		*		$	(1.3)		$	(1.4)		(7)		Operating loss		$	(4.9)		$	(3.3)		48
Restructuring charges		0.2			—			*		0.9			—			*
Net (gain) loss on dispositions		(8.0)			—			*		(12.1)			0.2			*

Depreciation and amortization(b)	Depreciation and amortization(b)	3.5			5.0			(30)		10.8			15.5			(30)		Depreciation and amortization(b)		2.9			3.3			(12)
Adjusted OIBDA(b)	Adjusted OIBDA(b)	$	3.2		$	4.3		(26)		$	(1.7)		$	14.3		*		Adjusted OIBDA(b)		$	(2.0)		$	—		*

* Calculation is not meaningful.

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

(b)Consistent with the current year’s presentation, we have reclassified amortization of direct lease acquisition costs of $0.5 million in the three months ended March 31, 2020, in Other from Amortization to SG&A expenses, resulting in a corresponding decrease in Adjusted OIBDA.

In the third quarter of 2020, we completed the Sports Disposition. The operating results of our Sports Marketing operating segment through June 30, 2020, are included in our Consolidated Financial Statements.

Total Other revenues decreased ~~$23.3~~$16.8 million, or ~~59%~~55%, in the three months ended ~~September 30, 2020, and decreased $46.9 million, or 41%, in the nine months ended September 30, 2020,~~March 31, 2021, compared to the same prior-year ~~periods,~~period, reflecting the Sports Disposition and a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our ~~services through purchase cancellations or otherwise, as well as the cancellation of spring sports at colleges and universities and a decrease in third-party digital equipment sales.~~services.

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~~In the nine months ended September 30, 2020, non-organic revenues exclude the impact of the Sports Disposition.~~ In the three ~~and nine~~ months ended ~~September 30, 2019,~~March 31, 2020, non-organic revenues exclude the impact of the Sports Disposition and reflect the impact of foreign currency exchange rates.

Organic Other revenues decreased ~~$11.9~~$3.6 million, or ~~42%~~21%, in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year period, reflecting a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our ~~services through purchase cancellations or otherwise, and a decrease in third-party digital equipment sales. Organic~~ services.

Other ~~revenues~~operating expenses decreased ~~$31.1~~$10.6 million, or ~~43%~~48%, in the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year period, ~~reflecting~~primarily driven by the impact of the Sports Disposition and lower billboard and transit revenues. Other SG&A expenses decreased $4.2 million, or 49%, in the three months ended March 31, 2021, compared to the prior-year period, primarily driven by the impact of the Sports Disposition.

Other incurred an Adjusted OIBDA loss of $2.0 million in the three months ended March 31, 2021, compared to Adjusted OIBDA of $0.0 million in the same prior-year period. The decrease was due primarily to a decline in average revenue per

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display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services, ~~through purchase cancellations or otherwise,~~ and ~~a decrease in third-party digital equipment sales.~~

~~Other~~ ~~operating expenses decreased $17.5, or 64%, in the three months ended September 30, 2020, compared to the same prior-year period.~~ ~~Other~~ ~~SG&A expenses decreased $4.7 million, or 58%, in the three months ended September 30, 2020, compared to the prior-year period.~~ ~~Other~~ ~~operating expenses decreased $22.9 million, or 31%, in the nine months ended September 30, 2020, compared to the same prior-year period.~~ ~~Other~~ ~~SG&A expenses decreased $8.0 million, or 32%, in the nine months ended September 30, 2020, compared to the prior-year period. The decreases in~~ ~~Other~~ ~~operating expenses were primarily driven by~~ the impact of the Sports Disposition and lower expenses related to our Sports Marketing operating segment prior to the disposition, lower costs related to third-party digital equipment sales and lower billboard and transit revenues. The decreases in ~~Other~~ ~~SG&A expenses were primarily driven by the impact of the Sports Disposition and cost reduction measures taken in response to the COVID-19 pandemic.~~

~~Other~~ incurred Adjusted OIBDA of $3.2 million in the three months ended September 30, 2020, compared to $4.3 million in the same prior-year period and incurred an Adjusted OIBDA loss of $1.7 million in the nine months ended September 30, 2020, compared to Adjusted OIBDA of $14.3 million in the same prior-year period. The decreases were due primarily to the Sports Disposition, a decline in average revenue per display (yield) as a result of the impact of the COVID-19 pandemic on customer advertising expenditures and overall demand for our services through purchase cancellations or otherwise, the impact of the Sports Disposition, as well as the cancellation of spring sports at colleges and universities, partially offset by cost reduction measures taken in response to the COVID-19 pandemic.Disposition.

Corporate

Corporate expenses primarily include expenses associated with employees who provide centralized services. Corporate expenses, excluding stock-based compensation, were ~~$8.9~~$11.5 million in the three months ended ~~September 30, 2020,~~March 31, 2021, compared to ~~$11.3 million in the same prior-year period. Corporate expenses, excluding stock-based compensation, were $23.7 million in the nine months ended September 30, 2020, compared to $31.3~~$4.5 million in the same prior-year period. The ~~decreases were~~increase was primarily due to ~~lower compensation-related expenses, including lower costs resulting from cost reduction measures taken in response to the COVID-19 pandemic and~~ the impact of market fluctuations on an equity-linked retirement plan offered by the Company to certain ~~employees.~~employees and higher compensation-related expenses.

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Liquidity and Capital Resources

As of
(in millions, except percentages) September 30,
2020 December 31, 2019 % Change
Assets:
Cash and cash equivalents $ 690.6 $ 59.1 *%
Restricted cash 1.6 1.8 (11)
Receivables, less allowance ($24.8 in 2020 and $12.1 in 2019) 191.4 290.0 (34)
Prepaid lease and transit franchise costs 4.7 8.6 (45)
Prepaid MTA equipment deployment costs — 55.4 (100)
Other prepaid expenses 18.4 15.8 16
Other current assets 31.5 5.1 518
Total current assets 938.2 435.8 115
Liabilities:
Accounts payable 51.9 67.9 (24)
Accrued compensation 25.9 56.1 (54)
Accrued interest 26.4 26.4 —
Accrued lease and transit franchise costs 54.0 55.3 (2)
Other accrued expenses 40.4 34.2 18
Deferred revenues 40.6 29.0 40
Short-term debt 80.0 195.0 (59)
Short-term operating lease liabilities 182.8 168.3 9
Other current liabilities 25.0 17.8 40
Total current liabilities 527.0 650.0 (19)
Working capital (deficit) $ 411.2 $ (214.2) *

•~~Calculation is not meaningful.~~


	As of
(in millions, except percentages)	March 31, 2021		December 31, 2020		% Change
Assets:
Cash and cash equivalents	$	560.0	$	710.4	*
Restricted cash	1.6		1.6		—	%
Receivables, less allowance ($22.7 in 2021 and $26.3 in 2020)	164.9		209.2		(21)
Prepaid lease and transit franchise costs	9.1		5.4		69

Other prepaid expenses	13.9		14.4		(3)
Other current assets	28.0		33.7		(17)
Total current assets	777.5		974.7		(20)
Liabilities:
Accounts payable	56.8		64.9		(12)
Accrued compensation	30.9		35.0		(12)
Accrued interest	17.5		24.5		(29)
Accrued lease and transit franchise costs	39.1		65.8		(41)
Other accrued expenses	40.0		38.0		5
Deferred revenues	42.3		29.5		43
Short-term debt	—		80.0		(100)
Short-term operating lease liabilities	185.7		176.5		5
Other current liabilities	20.4		20.7		(1)
Total current liabilities	432.7		534.9		(19)
Working capital	$	344.8	$	439.8	(22)

We continually project anticipated cash requirements for our operating, investing and financing needs as well as cash flows generated from operating activities available to meet these needs. Due to seasonal advertising patterns and influences on advertising markets, our revenues and operating income are typically highest in the fourth quarter, during the holiday shopping season, and lowest in the first quarter, as advertisers adjust their spending following the holiday shopping season. Further, certain of our municipal transit contracts require guaranteed minimum annual payments to be paid on a monthly or quarterly basis, as applicable.

Our short-term cash requirements primarily include payments for operating leases, guaranteed minimum annual payments, interest, capital expenditures, equipment deployment costs and dividends. Funding for short-term cash needs will come primarily from our cash on hand, operating cash flows, our ability to issue debt and equity securities, and borrowings under the Revolving Credit Facility (as defined below), the AR Securitization Facilities (as defined below) or other credit facilities that we may establish, to the extent available.

In addition, as part of our growth strategy, we frequently evaluate strategic opportunities to acquire new businesses, assets or digital technology. Consistent with this strategy, we regularly evaluate potential acquisitions, ranging from small transactions to larger acquisitions, which transactions could be funded through cash on hand, additional borrowings, equity or other securities, or some combination thereof. In response to the ongoing COVID-19 pandemic, we have taken a highly selective approach to new acquisition activity.

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Our long-term cash needs include principal payments on outstanding indebtedness and commitments related to operating leases and franchise and other agreements, including any related guaranteed minimum annual payments, and equipment deployment costs. Funding for long-term cash needs will come from our cash on hand, operating cash flows, our ability to issue debt and equity securities, and borrowings under the Revolving Credit Facility or other credit facilities that we may establish, to the extent available.

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~~We expect~~Although we have taken several actions to date to preserve our financial flexibility and increase our liquidity, our short-term and long-term cash needs and related funding capability tomay be adversely affected by the impact of the ongoing COVID-19 pandemic asif cash on hand and operating cash flows decrease in ~~2020,~~2021, and our ability to issue debt and equity securities and/or borrow under our existing or new credit facilities on reasonable pricing terms, or at all, may become uncertain. In order to preserve financial flexibility and increase liquidity in light of the current uncertainty in the global economy and our business resulting from the COVID-19 pandemic, we repaid in full all borrowings under the Revolving Credit Facility as of June 30, 2020, using the net proceeds from the offering of the Notes and cash on hand, raised $400.0 million in the Private Placement (as defined below), before expenses, issued $400.0 million aggregate principal amount of the Notes and amended the Credit Agreement to modify the calculation of the Company’s financial maintenance covenant ratio under the Credit Agreement, among other things. (See the “Overview—COVID-19 Impact” section of this MD&A.)

The ~~increase~~decrease in working capital as of ~~September 30, 2020,~~March 31, 2021, compared to ~~a working capital deficit~~ as of December 31, ~~2019,~~2020, is primarily driven by ~~the increase in~~lower cash ~~as a result of the Private Placement. The increase in cash is~~and receivables, partially offset by ~~a decline in~~ ~~Prepaid MTA deployment costs. As a result of the impact of the COVID-19 pandemic on our business~~lower short-term debt, accounts payable and ~~our expectations with respect to future revenues under the MTA agreement into the future, we reclassified~~ ~~Prepaid MTA deployment costs~~ ~~to long-term assets.~~accrued expenses.

Under the MTA agreement, we are obligated to deploy, over a number of years, (i) 8,565 digital advertising screens on subway and train platforms and entrances, (ii) 37,716 smaller-format digital advertising screens on rolling stock, and (iii) 7,829 MTA communications displays, with such deployment amounts being subject to modification as agreed-upon by us and the MTA. In addition, we are obligated to pay to the MTA the greater of a percentage of revenues or a guaranteed minimum annual payment. Incremental revenues that exceed an annual base revenue amount will be retained by us for the cost of deploying advertising and communications displays throughout the transit system. As presented in the table below, recoupable MTA equipment deployment costs are being recorded as Prepaid MTA equipment deployment costs and Intangible assets on our Consolidated Statement of Financial Position, and as these costs are recouped from incremental revenues that the MTA would otherwise be entitled to receive, Prepaid MTA equipment deployment costs will be reduced. If incremental revenues generated over the term of the agreement are not sufficient to cover all or a portion of the equipment deployment costs, the costs will not be recouped, which could have an adverse effect on our business, financial condition and results of operation. We did not recoup any equipment deployment costs in the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, and ~~it’s~~it is unlikely we will recoup equipment deployment costs in ~~2020.~~2021. In June 2020, we entered into an amendment to the MTA agreement, pursuant to which (i) for up to $143.0 million of MTA equipment deployment costs to be incurred under the MTA agreement after June 2020, the MTA and the Company will directly pay 70% and 30% of the costs, respectively, instead of the costs being recoupable from incremental revenues generated under the agreement, and (ii) any guaranteed minimum annual payment amounts that would have been paid for the period from April 1, 2020 through December 31, 2020 (less any revenue share amounts actually paid during this period using an increased revenue share percentage of 65%) will instead be added in equal increments to the guaranteed minimum annual payment amounts owed for the period from January 1, 2022, through December 31, 2026. ~~In connection~~Our payment obligations with ~~the amendment~~respect to guaranteed minimum annual payment amounts owed to the MTA ~~Agreement~~resumed on January 1, 2021, in accordance with the terms of the MTA agreement, as amended. We have engaged, and will continue to engage, in ~~coordination~~constructive conversations with the MTA ~~after suspending our~~regarding possible modifications to the overall scope and term under the MTA agreement. While we are engaging in these conversations with the MTA, we have temporarily suspended deployment ~~of advertising and communications displays throughout the transit system in March 2020 as a result of the impact of the COVID-19 pandemic, we recommenced deployment~~beginning in the ~~third~~first quarter of ~~2020.~~2021. Accordingly, for the full year of ~~2020,~~2021, we ~~currently~~ expect our MTA equipment deployment costs to be ~~significantly lower than our previously disclosed amount of~~ approximately ~~$175.0 million as we recommence deployment in 2020.~~$100.0 million. We may utilize cash on hand and/or incremental third-party financing to fund equipment deployment costs over the next couple of years. However, given the uncertainty in the market around the severity and duration of the COVID-19 pandemic, we cannot reasonably estimate the aggregate financing amount, if any, at this time. As of ~~September 30, 2020,~~March 31, 2021, we have issued surety bonds ~~(in place of letters of credit)~~ in favor of the MTA totaling approximately $136.0 million, which amount is subject to change as equipment installations are completed and revenues are generated. ~~In addition, in the first quarter of 2020, we identified the COVID-19 pandemic as a trigger for impairment review of our~~ ~~Prepaid MTA equipment deployment costs~~ and related intangible assets, and after performing an analysis, no impairment was identified. In the second and third quarters of 2020, we updated our projections in connection with the amendment to the MTA agreement and did not identify a triggering event for an impairment review of our ~~Prepaid MTA equipment deployment costs.~~ ~~(See the “Critical Accounting Polices—MTA Agreement” section of this MD&A.) Further, we~~We expect transit franchise expenses, ~~to materially increase~~ as a percentage of revenues, ~~more~~to increase in 2021 as compared to 2020, and be materially higher than ~~historical levels, as revenues decline in 2020 as a result of the impact of the COVID-19 pandemic.~~pre-COVID-19 pandemic levels. (See the “Overview—COVID-19 Impact” section of this MD&A.) As indicated in the table below, we incurred ~~$66.7~~$17.4 million related to MTA equipment deployment costs in the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 (which includes equipment deployment costs related to future deployments), for a total of ~~$314.3~~$368.5 million to date, of which $33.9 million had been recouped from incremental revenues to date and as of ~~September 30, 2020, $21.7~~March 31, 2021, $53.5 million is to be funded by the MTA. As of ~~September 30, 2020, 6,177~~March 31, 2021, 7,645 digital displays had been installed, of which ~~827~~265 installations occurred in the three months ended ~~September 30, 2020, for a total of 1,600 installations in the nine months ended September 30, 2020.~~March 31, 2021.

4538

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(in millions) Beginning Balance Deployment Costs Incurred Recoupment Amortization Ending Balance
Nine months ended September 30, 2020:
Prepaid MTA equipment deployment costs $ 171.5 $ 29.4 $ — $ — $ 200.9
Other current assets — 21.7 — — 21.7
Intangible assets (franchise agreements) 38.3 15.6 — (4.1) 49.8
Total $ 209.8 $ 66.7 $ — $ (4.1) $ 272.4
Year ended December 31, 2019:
Prepaid MTA equipment deployment costs $ 79.5 $ 124.2 $ (32.2) $ — $ 171.5
Intangible assets (franchise agreements) 14.8 26.6 — (3.1) 38.3
Total $ 94.3 $ 150.8 $ (32.2) $ (3.1) $ 209.8

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


(in millions)	Beginning Balance		Deployment Costs Incurred		Recoupment/MTA Funding		Amortization		Ending Balance
Three months ended March 31, 2021:
Prepaid MTA equipment deployment costs	$	204.6	$	3.6	$	—	$	—	$	208.2
Other current assets	28.0		9.1		(16.2)		—		20.9
Intangible assets (franchise agreements)	58.4		4.7		—		(2.5)		60.6
Total	$	291.0	$	17.4	$	(16.2)	$	(2.5)	$	289.7

Year ended December 31, 2020:
Prepaid MTA equipment deployment costs	$	171.5	$	33.1	$	—	$	—	$	204.6
Other current assets	—		44.4		(16.4)		—		28.0
Intangible assets (franchise agreements)	38.3		26.0		—		(5.9)		58.4
Total	$	209.8	$	103.5	$	(16.4)	$	(5.9)	$	291.0

Debt

Debt, net, consists of the following:


		As of							As of
(in millions, except percentages)	(in millions, except percentages)	September 30, 2020			December 31, 2019			(in millions, except percentages)	March 31, 2021			December 31, 2020
Short-term debt:	Short-term debt:							Short-term debt:
AR Facility		$	—		$	105.0

Repurchase Facility	Repurchase Facility	80.0			90.0			Repurchase Facility	$	—		$	80.0
Total short-term debt	Total short-term debt	80.0			195.0			Total short-term debt	—			80.0

Long-term debt:	Long-term debt:							Long-term debt:

Term loan, due 2026	Term loan, due 2026	597.7			597.5			Term loan, due 2026	597.9			597.8

Senior unsecured notes:	Senior unsecured notes:							Senior unsecured notes:
5.625% senior unsecured notes, due 2024	5.625% senior unsecured notes, due 2024	501.4			501.7			5.625% senior unsecured notes, due 2024	—			501.3
6.250% senior unsecured notes, due 2025	6.250% senior unsecured notes, due 2025	400.0			—			6.250% senior unsecured notes, due 2025	400.0			400.0
5.000% senior unsecured notes, due 2027	5.000% senior unsecured notes, due 2027	650.0			650.0			5.000% senior unsecured notes, due 2027	650.0			650.0
4.250% senior unsecured notes, due 2029								4.250% senior unsecured notes, due 2029	500.0			—
4.625% senior unsecured notes, due 2030	4.625% senior unsecured notes, due 2030	500.0			500.0			4.625% senior unsecured notes, due 2030	500.0			500.0
Total senior unsecured notes	Total senior unsecured notes	2,051.4			1,651.7			Total senior unsecured notes	2,050.0			2,051.3

Debt issuance costs	Debt issuance costs	(29.5)			(27.1)			Debt issuance costs	(31.3)			(28.3)
Total long-term debt, net	Total long-term debt, net	2,619.6			2,222.1			Total long-term debt, net	2,616.6			2,620.8

Total debt, net	Total debt, net	$	2,699.6		$	2,417.1		Total debt, net	$	2,616.6		$	2,700.8

Weighted average cost of debt	Weighted average cost of debt	4.5		%	4.5		%	Weighted average cost of debt	4.3		%	4.5		%


		Payments Due by Period											Payments Due by Period
(in millions)	(in millions)	Total		2020		2021-2022		2023-2024		2025 and thereafter		(in millions)	Total		2021		2022-2023		2024-2025		2026 and thereafter
Long-term debt	Long-term debt	$	2,650.0	$	—	$	—	$	500.0	$	2,150.0	Long-term debt	$	2,650.0	$	—	$	—	$	400.0	$	2,250.0
Interest	Interest	848.8		124.4		246.0		219.5		258.9		Interest	810.0		115.9		226.8		213.9		253.4
Total	Total	$	3,498.8	$	124.4	$	246.0	$	719.5	$	2,408.9	Total	$	3,460.0	$	115.9	$	226.8	$	613.9	$	2,503.4

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Term Loan

Revolving Credit Facility

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

As of ~~September 30, 2020,~~March 31, 2021, there were no outstanding borrowings under the Revolving Credit Facility.

Standalone Letter of Credit Facilities

Accounts Receivable Securitization Facilities

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will be transferred to MUFG, as repurchase buyer, on an uncommitted basis, and subject to repurchase by the applicable Originators on termination of the Repurchase Facility. The Originators have granted MUFG a security interest in the Subordinated Notes to secure their obligations under the agreements governing the Repurchase Facility, and the Company has agreed to guarantee the Originators’ obligations under the agreements governing the Repurchase Facility.

As of ~~September 30, 2020,~~March 31, 2021, there were no outstanding borrowings under either the AR Facility ~~and $80.0 million of outstanding borrowings under~~or the Repurchase ~~Facility, at a borrowing rate of approximately 1.9%.~~Facility. As of ~~September 30, 2020,~~March 31, 2021, there was no borrowing capacity remaining under the AR Facility based on approximately ~~$231.9~~$207.9 million of

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accounts receivable used as collateral for the AR Securitization Facilities and a related voluntary temporary suspension of the AR Facility, and there was no$80.0 million of borrowing capacity remaining under the Repurchase Facility, in accordance with the agreements governing the AR Securitization Facilities. The commitment fee based on the amount of unused commitments under the AR Facility was immaterial for each of the three ~~and nine~~ months ended ~~September 30, 2020~~March 31, 2021 and ~~2019.~~2020.

Senior Unsecured Notes

On ~~May 15, 2020,~~January 19, 2021, two of our wholly-owned subsidiaries, Outfront Media Capital LLC (“Finance LLC”) and Outfront Media Capital Corporation (“Finance Corp” and, together with Finance LLC, the “Borrowers”), issued ~~the~~$500.0 million aggregate principal amount of 4.250% Senior Unsecured Notes due 2029 (the “2029 Notes”) in a private placement. The 2029 Notes are fully and unconditionally guaranteed on a senior unsecured basis by the Company and each of its direct and indirect domestic subsidiaries that guarantee the Senior Credit Facilities. Interest on the 2029 Notes is payable on ~~June~~January 15 and ~~December~~July 15 of each year, beginning on ~~December~~July 15, ~~2020.~~2021. On or after ~~June~~January 15, ~~2022,~~2024, the Borrowers may redeem at any time, or from time to time, some or all of the 2029 Notes. Prior to such date, the Borrowers may redeem up to 40% ~~of the aggregate principal amount~~ of the aggregate principal amount with the net proceeds of certain equity offerings, provided that at least 50% of the aggregate principal amount of the 2029 Notes will remain outstanding after the redemption.

Debt Covenants

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periods ended June 30, 2019 and September 30, 2019, respectively; and (ii) the Company will not make any Restricted Payments (as defined in the Credit Agreement) without the consent of the applicable lenders under the Credit Agreement, subject to certain exceptions such as payments necessary to maintain the Company’s REIT status, including any payments on any class of the Company’s capital stock that is required to be made prior to the payment of a dividend or distribution on the Company’s common stock and the Company’s existing payment obligations to holders of the Class A equity interests in Outfront Canada (as defined in Note 10. Equity to the Consolidated Financial Statements).

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Deferred Financing Costs

Interest Rate Swap Agreements

Equity

At-the-Market Equity Offering Program

We have a sales agreement in connection with an “at-the-market” equity offering program (the “ATM Program”), under which we may, from time to time, issue and sell shares of our common stock up to an aggregate offering price of $300.0 million. We have no obligation to sell any of our common stock under the sales agreement and may at any time suspend solicitations and offers under the sales agreement. No shares were sold under the ATM Program during the three ~~and nine~~ months ended ~~September 30, 2020.~~March 31, 2021. As of ~~September 30, 2020,~~March 31, 2021, we had approximately $232.5 million of capacity remaining under the ATM Program.

Series A Preferred Stock Issuance

On April 20, 2020, ~~(the “Closing Date”), the Company~~we issued ~~and sold an aggregate of~~ 400,000 shares of our Series A Convertible Perpetual Preferred Stock (the “Series A Preferred Stock”), par value $0.01 per share, at a purchase price of $1,000 per share, for an aggregate purchase price of $400.0 million (the “Private Placement”) to certain affiliates of Providence Equity Partners LLC (collectively, the “Providence Purchasers”) and ASOF Holdings L.L.P. and Ares Capital Corporation (collectively, the “Ares Purchasers” and, together with the Providence Purchasers, the “Purchasers”).

share. The Series A Preferred Stock ranks senior to the shares of the Company’s common stock ~~par value $0.01 per share,~~ 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. The dividend rate will increase by an additional 0.75% annually following the eighth anniversary of the Closing Date and is~~arrears, subject to increases ~~under certain other circumstances~~ as set forth in 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 ~~the eighth anniversary of the Closing Date,~~April 20, 2028, after which time dividends will be payable solely in cash. So long as any shares of Series A Preferred Stock remain outstanding, the Company may not declare a dividend on, or make any distributions relating to, capital stock that ranks junior to, or on a parity basis with, the Series A Preferred Stock, subject to certain exceptions, including but not limited to (i) any dividend or distribution in cash or capital stock of the Company on or in respect of the capital stock of the Company to the extent that such dividend or distribution is necessary to maintain the Company’s status as a REIT; and (ii) any dividend or distribution in cash in respect of our common stock that, together with the dividends or distributions during the 12-month period immediately preceding such dividend or distribution, is not in excess of 5% of the aggregate dividends or distributions paid by the Company necessary to maintain its REIT status during such ~~12-~~

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~~month~~12-month period. ~~Following the one-year anniversary of the Closing Date, if all or~~If any ~~portion of the~~ dividends or distributions ~~is paid~~ in respect of the shares of our common stock are paid in cash, the shares of Series A Preferred Stock will participate in ~~such~~the dividends or distributions on an as-converted basis up to the amount of their accrued dividend ~~on the Series A Preferred Stock~~ for such quarter, which amounts will reduce the dividends payable on the shares of Series A Preferred Stock dollar-for-dollar for such quarter.

~~During the three months ended September 30, 2020, we paid cash dividends~~

Table of $7.0 million on the Series A Preferred Stock. As of September 30, 2020, the maximum number of shares of common stock that could be required to be issued on conversion of the outstanding shares of Series A Preferred Stock was 25.0 million shares.Contents

Cash Flows

The following table presents our cash flows in the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 and ~~2019.~~2020.


		Nine Months Ended							Three Months Ended
		September 30,				%			March 31,				%
(in millions, except percentages)	(in millions, except percentages)	2020		2019		Change		(in millions, except percentages)	2021		2020		Change
Cash provided by operating activities		$	86.0	$	162.1	(47)	%
Cash provided by (used for) operating activities								Cash provided by (used for) operating activities	$	(10.8)	$	14.9	*
Cash used for investing activities	Cash used for investing activities	(35.1)		(138.1)		(75)		Cash used for investing activities	(28.3)		(26.7)		6	%
Cash provided by (used for) financing activities	Cash provided by (used for) financing activities	581.0		(14.7)		*		Cash provided by (used for) financing activities	(111.6)		442.2		*
Effect of exchange rate changes on cash, cash equivalents and restricted cash	Effect of exchange rate changes on cash, cash equivalents and restricted cash	(0.6)		0.3		*		Effect of exchange rate changes on cash, cash equivalents and restricted cash	0.3		(1.7)		*
Net increase in cash, cash equivalents and restricted cash		$	631.3	$	9.6	*
Net increase (decrease) in cash, cash equivalents and restricted cash								Net increase (decrease) in cash, cash equivalents and restricted cash	$	(150.4)	$	428.7	*

*Calculation is not meaningful.

Cash used for operating activities was $10.8 million in the three months ended March 31, 2021, compared to Cash provided by operating activities ~~decreased $76.1~~of $14.9 million ~~or 47%,~~ in ~~the nine months ended September 30, 2020, compared to~~ the same prior-year period, driven by the impact of the COVID-19 pandemic, partially offset by the impact of cost reduction measures taken in response to the COVID-19 pandemic. In the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, we ~~paid $51.1~~received net cash of $3.5 million related to MTA equipment deployment ~~costs~~ and installed ~~1,600~~265 digital displays. In the ~~nine~~three months ended ~~September 30, 2019,~~March 31, 2020, we paid ~~$83.3~~$18.2 million related to MTA equipment deployment costs.

Cash used for investing activities ~~decreased $103.0~~increased $1.6 million, or ~~75%~~6%, in the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year period, due primarily to higher ~~proceeds from dispositions, including proceeds from the Sports Disposition,~~cash paid for acquisitions and MTA franchise rights, partially offset by lower cash paid for ~~acquisitions,~~ capital ~~expenditures and MTA franchise rights.~~expenditures.

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The following table presents our capital expenditures in the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 and ~~2019.~~2020.


		Nine Months Ended							Three Months Ended
		September 30,				%			March 31,				%
(in millions, except percentages)	(in millions, except percentages)	2020		2019		Change		(in millions, except percentages)	2021		2020		Change
Growth	Growth	$	28.0	$	50.4	(44)	%	Growth	$	5.8	$	13.4	(57)	%
Maintenance	Maintenance	14.0		15.0		(7)		Maintenance	3.6		4.8		(25)
Total capital expenditures	Total capital expenditures	$	42.0	$	65.4	(36)		Total capital expenditures	$	9.4	$	18.2	(48)

Capital expenditures decreased ~~$23.4~~$8.8 million, or ~~36%~~48%, in the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, compared to the same prior-year period, primarily due to lower spending on digital billboard and transit display projects, office remodel projects, vehicles and ~~lower~~safety, partially offset by higher spending on ~~installation of the most current LED lighting technology.~~our technology platform.

In response to the impact of the COVID-19 pandemic, we reduced maintenance capital expenditures (other than for necessary safety-related projects) and growth capital expenditures for digital billboard display conversions. For the full year of ~~2020,~~2021, we expect our capital expenditures to be approximately ~~$55.0~~$85.0 million, which will be used primarily for ~~necessary safety-related maintenance projects and~~ growth in digital ~~displays.~~displays, maintenance and safety-related projects, software and technology, and to renovate certain office facilities. This estimate does not include equipment deployment costs that will be incurred in connection with the MTA agreement (as described above), which will be recorded as Prepaid MTA equipment deployment costs and Intangible assets on our Consolidated Statement of Financial Position, as applicable.

Cash used by financing activities was $111.6 million in the three months ended March 31, 2021, compared to Cash provided by financing activities ~~was $581.0 million in the nine months ended September 30, 2020, compared to~~ ~~Cash used by financing activities~~of ~~$14.7~~$442.2 million in the same prior-year period. In the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, we ~~received net proceeds~~made a repayment of ~~$400.0~~$80.0 million ~~related to~~under the ~~Notes offering~~Repurchase Facility and ~~received net proceeds~~paid total cash dividends of ~~$383.8~~$7.3 million ~~related to the issuance of~~on the Series A Preferred Stock and vested restricted share units granted to employees. In the three months ended March 31, 2020, we drew net borrowings of $495.0 million on our Revolving Credit Facility to enhance our liquidity position in response to the impact of the COVID-19 pandemic, and made net repayments under the AR Securitization Facilities of $115.0 million and paid total cash dividends on the Series A Preferred Stock and on our common stock of $68.1 million. In the nine months ended September 30, 2019, we paid cash dividends on our common stock of $156.0 million and made a discretionary payment of $50.0 million on the Term Loan. In addition, we received net proceeds of $100.0 million related to our 2027 senior unsecured notes offering and repayment of our 2022 senior unsecured notes, received net proceeds of $50.9 million related to the sale of our common stock under the ATM Program, drew net borrowings of ~~$50.0~~$15.0 million on the AR Securitization Facilities and ~~drew $15.0~~paid cash dividends of $55.6 million on ~~the Revolving Credit Facility.~~our common stock.

Cash paid for income taxes was ~~$3.1~~$0.5 million for in the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 and ~~$7.9~~$0.8 million in the ~~nine~~three months ended ~~September 30, 2019.~~March 31, 2020.

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Off-Balance Sheet Arrangements

Our off-balance sheet commitments primarily consist of guaranteed minimum annual payments. (See Note 18. Commitments and Contingencies to the Consolidated Financial Statements for information about our off-balance sheet commitments.)

Critical Accounting Policies

The preparation of our financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. On an ongoing basis, we evaluate these estimates, which are based on historical experience and on various assumptions that we believe are reasonable under the circumstances, including the impact of extraordinary events such as the COVID-19 pandemic. The result of these evaluations forms the basis for making judgments about the carrying values of assets and liabilities and the reported amount of revenues and expenses that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions, including the severity and duration of the COVID-19 pandemic.

WeFor accounting policies we consider ~~the following accounting policy~~ to be the most critical as ~~it is~~they are significant to our financial condition and results of operations, and ~~requires~~require significant judgment and estimates on the part of management in ~~its application.~~ their application, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies” in our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on February 26, 2021.

For a summary of our significant accounting policies, see Item 8., Note 2. Summary of Significant Accounting Policies to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, ~~2019,~~2020, filed with the SEC on February 26, ~~2020.~~

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~~MTA Agreement~~

Title of the various digital displays transfers to the MTA on installation, therefore the cost of deploying these screens throughout the transit system does not represent our property and equipment. The portion of recoupable MTA equipment deployment costs expected to be reimbursed from transit franchise fees that would otherwise be payable to the MTA are recorded as ~~Prepaid MTA equipment deployment costs~~ ~~on the Consolidated Statement of Financial Position and charged to operating expenses as advertising revenue is generated. The short-term portion of~~ ~~Prepaid MTA equipment deployment costs~~ represents the costs that we expect to recover from the MTA in the next twelve months. The portion of deployment costs expected to be reimbursed from advertising revenues that would otherwise be retained by us under the contract are recorded as ~~Intangible assets~~ ~~on the Consolidated Statement of Financial Position and charged to amortization expense on a straight line basis over the contract period.~~

~~If we do not generate sufficient advertising revenues from the MTA contract, there is a risk that the related~~ ~~Prepaid MTA equipment deployment costs~~ ~~and~~ ~~Intangible assets~~ may not be recoverable. Management assesses the prepaid MTA equipment deployment costs for recoverability on a quarterly basis. 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, 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. In the first quarter of 2020, we identified the COVID-19 pandemic as a trigger for an impairment review of our ~~Prepaid MTA equipment deployment costs~~ and related intangible assets. After updating our projections to reflect related declines in revenues in 2020 and delays in our anticipated deployment schedule as a result of the impact of the COVID-19 pandemic, among other things, no impairment was identified. In the second and third quarters of 2020, we updated our projections in connection with the amendment to the MTA agreement and did not identify a triggering event for an impairment review of our P~~repaid MTA equipment deployment costs~~. The assumptions and estimates included in our analysis require significant judgment about future events, market conditions and financial performance. Given the uncertainty around the severity and duration of the COVID-19 pandemic and the measures taken, or may be taken, in response to the COVID-19 pandemic, actual results may differ from our assumptions and estimates, which may result in impairment charges in the future. 2021.

Accounting Standards

See Note 2. New Accounting Standards to the Consolidated Financial Statements for information about the adoption of new accounting standards and recent accounting pronouncements.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

We have made statements in this ~~Annual~~MD&A and other sections of this Quarterly Report on Form ~~10-K~~10-Q that are forward-looking statements within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “could,” “would,” “may,” “might,” “will,” “should,” “seeks,” “likely,” “intends,” “plans,” “projects,” “predicts,” “estimates,” “forecast” or “anticipates” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions related to our capital resources, portfolio performance and results of operations, including but not limited to the impact of the COVID-19 pandemic on our capital resources, portfolio performance and results of operations.

Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and may not be able to be realized. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). 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:

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Declines in advertising and general economic conditions, including declines caused by the COVID-19 pandemic;

•The severity and duration of the ~~novel coronavirus (COVID-19)~~COVID-19 pandemic and any other pandemics, and the impact on our business, financial condition and results of operations;

•~~Declines in advertising and general economic conditions, including declines caused by the COVID-19 pandemic;~~

•Competition;

•Government regulation;

•Our ability to implement our digital display platform and deploy digital advertising displays to our transit franchise partners, including interruptions and reductions in demand caused by the impact of the COVID-19 pandemic;

•~~Taxes, fees~~Losses and ~~registration requirements;~~costs resulting from recalls and product liability, warranty and intellectual property claims;

•Our ability to obtain and renew key municipal contracts on favorable terms;

•Taxes, fees and registration requirements;

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•Decreased government compensation for the removal of lawful billboards;

•Content-based restrictions on outdoor advertising;

•~~Environmental, health and safety laws and regulations;~~

•Seasonal variations;

•Acquisitions and other strategic transactions that we may pursue could have a negative effect on our results of operations;

•Dependence on our management team and other key employees;

•~~The ability of~~Diverse risks in our ~~board of directors to cause us to issue additional shares of stock without stockholder approval;~~Canadian business;

•~~Certain provisions of Maryland law may limit the ability of~~Experiencing a ~~third party to acquire control of us;~~cybersecurity incident;

•~~Our rights~~Changes in regulations and ~~the rights of~~consumer concerns regarding privacy, information security and data, or any failure or perceived failure to comply with these regulations or our ~~stockholders to take action against~~internal policies;

•Asset impairment charges for our ~~directors~~long-lived assets and ~~officers are limited;~~goodwill;

•Environmental, health and safety laws and regulations;

•Our substantial indebtedness;

•Restrictions in the agreements governing our indebtedness;

•Incurrence of additional debt;

•Interest rate risk exposure from our variable-rate indebtedness;

•Our ability to generate cash to service our indebtedness;

•Cash available for distributions;

•Hedging transactions;

•~~Diverse risks in~~The ability of our ~~Canadian business;~~board of directors to cause us to issue additional shares of stock without common stockholder approval;

•~~Experiencing~~Certain provisions of Maryland law may limit the ability of a ~~cybersecurity incident;~~third party to acquire control of us;

•~~Changes in regulations~~Our rights and ~~consumer concerns regarding privacy, information security~~the rights of our stockholders to take action against our directors and ~~data, or any failure or perceived failure to comply with these regulations or our internal policies;~~

•~~Asset impairment charges for our long-lived assets and goodwill;~~officers are limited;

•Our failure to remain qualified to be taxed as a ~~real estate investment trust (“REIT”);~~REIT;

•REIT distribution requirements;

•Availability of external sources of capital;

•We may face other tax liabilities even if we remain qualified to be taxed as a REIT;

•Complying with REIT requirements may cause us to liquidate investments or forgo otherwise attractive opportunities;

•Our ability to contribute certain contracts to a ~~taxable REIT subsidiary (“TRS”);~~TRS;

•Our planned use of TRSs may cause us to fail to remain qualified to be taxed as a REIT;

•REIT ownership limits;

•Complying with REIT requirements may limit our ability to hedge effectively;

•Failure to meet the REIT income tests as a result of receiving non-qualifying income;

•The Internal Revenue Service ~~(the “IRS”)~~ may deem the gains from sales of our outdoor advertising assets to be subject to a 100% prohibited transaction tax; and

•Establishing operating partnerships as part of our REIT structure.

While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements in this Quarterly Report on Form 10-Q apply as of the date of this report or as of the date they were made and, except as required by applicable law, we disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. For a further discussion of these and other factors that could impact our future results, performance or transactions, see the section entitled “Risk Factors” in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, ~~2019,~~2020, filed with the SEC on February 26, ~~2020.~~2021. You should understand that it is not possible to predict or identify all such factors. Consequently, you should not consider any such list to be a complete set of all potential risks or uncertainties.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are exposed to market risk related to commodity prices and foreign currency exchange rates, and to a limited extent, interest rates and credit risks.

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Commodity Price Risk

We incur various operating costs that are subject to price risk caused by volatility in underlying commodity values. Commodity price risk is present in electricity costs associated with powering our digital billboard displays and lighting our traditional static billboard displays at night.

We do not currently use derivatives or other financial instruments to mitigate our exposure to commodity price risk. However, we do enter into contracts with commodity providers to limit our exposure to commodity price fluctuations. For the year ended

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December 31, ~~2019,~~2020, such contracts accounted for ~~18.0%~~17.7% of our total utility costs. As of ~~September 30, 2020,~~March 31, 2021, we had active electricity purchase agreements with fixed contract rates for locations throughout ~~Connecticut,~~ Illinois, New Jersey, ~~New York,~~ Pennsylvania ~~Ohio~~ and Texas, which expire at various dates ~~until~~through June 2024.

Foreign Exchange Risk

Foreign currency translation risk is the risk that exchange rate gains or losses arise from translating our Canadian business’s statements of earnings and statements of financial position from functional currency to our reporting currency (the U.S. Dollar) for consolidation purposes. Any gain or loss on translation is included within comprehensive income and Accumulated other comprehensive income on our Consolidated Statement of Financial Position. The functional currency of our international subsidiaries is their respective local currency. As of ~~September 30, 2020,~~March 31, 2021, we have ~~$8.0~~$0.1 million of unrecognized foreign currency translation losses included within Accumulated other comprehensive loss on our Consolidated Statement of Financial Position.

Substantially all of our transactions at our Canadian subsidiary are denominated in their local functional currency, thereby reducing our risk of foreign currency transaction gains or losses.

We do not currently use derivatives or other financial instruments to mitigate foreign currency risk, although we may do so in the future.

Interest Rate Risk

We are subject to interest rate risk to the extent we have variable-rate debt outstanding including under the Senior Credit Facilities and the AR Securitization Facilities.

As of ~~September 30, 2020,~~March 31, 2021, we had a $600.0 million variable-rate Term Loan due 2026 outstanding, which has an interest rate of 1.9% per year. An increase or decrease of 1/4% in our interest rate on the Term Loan will change our annualized interest expense by approximately $1.0 million.

As of ~~September 30, 2020,~~March 31, 2021, there were no outstanding borrowings under either the AR Facility ~~and $80.0 million of outstanding borrowings under~~or the Repurchase Facility, at a borrowing rate of 1.9%. An increase or decrease of 1/4% in our interest rate on the AR Securitization Facilities will change our annualized interest expense by approximately $0.2 million.Facility.

We have several interest rate cash flow swap agreements to effectively convert a portion of our LIBOR-based variable rate debt to a fixed rate and hedge our interest rate risk related to such variable rate debt. The fair value of these swap positions was a net unrecognized loss of approximately ~~$6.9~~$4.3 million as of ~~September 30, 2020,~~March 31, 2021, and is included in Other liabilities on our Consolidated Statement of Financial Position. The following table provides information about our interest rate swap agreements, which are sensitive to changes in interest rates. Notional amounts are used to calculate the contractual cash flows to be exchanged under the agreements.


(in millions, except percentages)	(in millions, except percentages)	2021			2022			2023			2024			2025			Thereafter			Total		Fair Value Loss as of 9/30/20		(in millions, except percentages)	2021			2022			2023			2024			2025			2026			Thereafter			Total		Fair Value Loss as of 3/31/21
Pay fixed/receive variable	Pay fixed/receive variable	$	150.0		$	50.0		$	—		$	—		$	—		$	—		$	200.0	$	6.9	Pay fixed/receive variable	$	150.0		$	50.0		$	—		$	—		$	—		$	—		$	—		$	200.0	$	4.3
Average pay rate	Average pay rate	2.7		%	1.8		%	—		%	—		%	—		%	—		%					Average pay rate	2.7		%	1.8		%	—		%	—		%	—		%	—		%	—		%
Average receive rate(a)	Average receive rate(a)	one-month LIBOR			one-month LIBOR			—			—			—			—							Average receive rate(a)	one-month LIBOR			one-month LIBOR			—			—			—			—			—

(a)The one-month LIBOR rate was approximately 0.1% as of ~~September 30, 2020.~~March 31, 2021.

~~Table of Contents~~

Credit Risk

In the opinion of our management, credit risk is limited due to the large number of customers and advertising agencies utilized. We perform credit evaluations on our customers and agencies and believe that the allowances for credit losses are adequate. We have experienced an increase in ~~the allowance for~~ credit losses as a result of the COVID-19 pandemic and accordingly, we recorded additional provisions for doubtful accounts in ~~the first quarter of~~ 2020. We expect provisions for doubtful accounts to decline in 2021.We do not currently use derivatives or other financial instruments to mitigate credit risk.

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Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

As required by Rule 13a-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), our management has carried out an evaluation, under the supervision of and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 13a-15(e) of the Exchange Act, as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report, were effective to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act, during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on Effectiveness of Disclosure Controls and Procedures and Internal Control Over Financial Reporting

In designing and evaluating our disclosure controls and procedures and internal control over financial reporting, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures and internal control over financial reporting must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

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PART II

Item 1. Legal Proceedings.

On an ongoing basis, we are engaged in lawsuits and governmental proceedings and respond to various investigations, inquiries, notices and claims from national, state and local governmental and other authorities (collectively, “litigation”). Litigation is inherently uncertain and always difficult to predict. Although it is not possible to predict with certainty the eventual outcome of any litigation, in our opinion, none of our current litigation is expected to have a material adverse effect on our results of operations, financial position or cash flows.

Item 1A. Risk Factors.

We have disclosed the risk factors affecting our business, results of operations and financial condition in the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, ~~2019,~~2020, filed with the SEC on February 26, ~~2020, and in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2020, filed with the SEC on May 8, 2020.~~2021. The impact of the COVID-19 pandemic described in this Quarterly Report on Form 10-Q have heightened certain of the risks disclosed in our Annual Report on Form 10-K for the year ended December ~~31, 2019, and in our Quarterly Report on Form 10-Q for the quarterly period ended March~~ 31, 2020, and such risk factors are further qualified by the information relating to the COVID-19 pandemic described in this Quarterly Report on Form 10-Q. There have been no material changes from the risk factors previously disclosed.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Unregistered Sales of Equity Securities

None.

Purchases of Equity Securities by the Issuer

Total Number of Shares
Purchased

Average Price Paid Per Share

Total Number of Shares Purchased as Part of Publicly Announced Programs

Remaining Authorizations

~~July~~January 1, ~~2020~~2021 through ~~July~~January 31, ~~2020~~2021

—

~~August~~February 1, ~~2020~~2021 through ~~August 31, 2020~~February 28, 2021

—

~~September~~March 1, ~~2020~~2021 through ~~September 30, 2020~~March 31, 2021

—

Total

—

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

None.

Item 6. Exhibits.

See Exhibit Index immediately following this Item, which is incorporated herein by reference.

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EXHIBIT INDEX


Exhibit Number						Description

3.1						Articles of Amendment and Restatement of OUTFRONT Media Inc. effective March 28, 2014, as amended by the Articles of Amendment of OUTFRONT Media Inc. effective November 20, 2014 and June 10, 2019 (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 001-36367), filed on June 10, 2019).

3.2						Amended and Restated Bylaws of OUTFRONT Media Inc. (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 001-36367), filed on February 26, 2019).

3.3						Articles Supplementary of OUTFRONT Media Inc. effective April 20, 2020 (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 001-36367), filed on April 21, 2020).

4.1						Indenture, dated as of ~~May 15, 2020,~~January 19, 2021, by and among Outfront Media Capital LLC, Outfront Media Capital Corporation, the guarantors named therein and Deutsche Bank Trust Company Americas (including the Form of Senior Notes) (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K (File No. 001-36367), filed on ~~May 15, 2020)~~January 19, 2021).

10.1						Form of Certificate and Terms and Conditions for Performance-Based Restricted Share Units Awards with Time Vesting under the OUTFRONT Media Inc. Amended and Restated Omnibus Stock Incentive Plan.

10.2						Form of Certificate and Terms and Conditions for Restricted Shares Units Awards with Time Vesting granted under the OUTFRONT Media Inc. Amended and Restated Omnibus Stock Incentive Plan.

10.3						Form of Certificate and Terms and Conditions for One-Time Performance-Based Restricted Share Units Awards with Time Vesting under the OUTFRONT Media Inc. Amended and Restated Omnibus Stock Incentive Plan.

10.4						Form of Certificate and Terms and Conditions for One-Time Restricted Share Units Awards with Time Vesting granted under the OUTFRONT Media Inc. Amended and Restated Omnibus Stock Incentive Plan.

31.1						Certification of the Chief Executive Officer of OUTFRONT Media Inc. pursuant to Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2						Certification of the Chief Financial Officer of OUTFRONT Media Inc. pursuant to Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the ~~Certification of the Chief Financial Officer of OUTFRONT Media Inc. pursuant to Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the~~ Sarbanes-Oxley ~~Act of 2002.~~ Act of 2002.

32.1						Certification of the Chief Executive Officer of OUTFRONT Media Inc. furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley act of 2002.

32.2						Certification of the Chief Financial Officer of OUTFRONT Media Inc. furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley act of 2002.

101.INS						XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH						Inline XBRL Taxonomy Extension Schema

101.CAL						Inline XBRL Taxonomy Calculation Linkbase

101.DEF						Inline XBRL Taxonomy Definition Document

101.LAB						Inline XBRL Taxonomy Label Linkbase

101.PRE						Inline XBRL Taxonomy Presentation Linkbase

104						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

OUTFRONT MEDIA INC.

By:

/s/ Matthew Siegel

Name:

Matthew Siegel

Title:

Executive Vice President and

Chief Financial Officer

(Principal Financial Officer)

Date: ~~November~~May 5, ~~2020~~2021

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	Activity	Weighted Average Exercise Price
Outstanding as of December 31, 2019	126,528	$	24.57
Exercised	(23,115)	16.43

Outstanding as of September 30, 2020	103,413	26.39

Exercisable as of September 30, 2020	103,413	26.39


(in millions)	Guaranteed Minimum Annual Payments
2020(a)	$	4.3
2021	199.4
2022	204.9
2023	179.3
2024	179.7
2025 and thereafter	559.3
Total minimum payments	$	1,326.9