What They Say
JCDecaux published its financial results for 2020 which showed a decline in revenues of 40.6% to €2.311 billion and that led to the first loss ever in the history of the group. The adjusted EBIT was -€352.9 million. Overall loss was -€604.6 million after an impairment charge of €211.3 million. The company said that Europe remains weak, but China is seeing some rebound and it is confident that there will be a rebound when restrictions on mobility are eased.
What We Think
As I have said, I try to avoid too many financial results, but JCD is a bellwether company for the OOH market. It looks to me that the firm used the same accounting philosophy that I was advised to adopt when my parent company told me, some decades ago ‘We’re making a loss for tax purposes this year’. The accountant said to me ‘If you are going to have a bath, get wet’. He meant that any red ink is judged more or less the same, so it’s a good idea to be hyper conservative and put any potential bad news into the bad year. After all, if things turn out better than expected, you can always make that discovery later in your brilliantly managed turn-around 🙂 (BR)
