Outdoor advertising group JC Decaux posted lower profits and omitted a dividend for 2009, saying it was still too early to know whether a sustained recovery was underway in the ad market.
"We will maintain strict cash and cost management in 2010," the company said in a statement.
The world's second-biggest outdoor advertiser posted operating profit down 28.7 per cent to €392 million for 2009, for an operating margin of 20.4 per cent.
The results were better than the consensus of operating profit of €365 million and 19 per cent margin, according to a Reuters poll of 10 analysts. The company carried out cost reduction programmes across its businesses allowing it to preserve margins even as its revenues dropped.
The company had forecast that its operating margin would be around 18 per cent for 2009, down from the 25.4 per cent operating margin achieved in 2008.
Its billboard business has been hit hardest, while street furniture like bus stops and transport like city bike rentals have held up better in the downturn.
The French company's fortunes are tied to the global economic recovery - advertising is typically a leading indicator of strengthening in the economy.
Analysts expect global advertising revenues to achieve 1 per cent growth this year, after declining about 10 per cent in 2009.
JC Decaux already reported 2009 revenues down 11.5 per cent to €1.92 billion as its core businesses were hit by the global contraction of the advertising market.
JC Decaux shares have climbed about 16 per cent since the beginning of the year to close at €19.74 per share yesterday, giving it a market capitalisation of €4.37 billion.
Reuters