iHeartMedia 2012 Annual Report Download - page 45

Download and view the complete annual report

Please find page 45 of the 2012 iHeartMedia annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 150

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150

42
$56.6 million from our traffic acquisition and an increase in expenses related to our digital initiatives, including our iHeartRadio
platform and iHeartRadio Music Festival. These increases were partially offset by a $19.0 million decline in music license fees
related to a settlement of 2011 and 2010 license fees. In addition, included in our 2011 results are restructuring expenses of
$8.9 million, which represents a decline of $4.8 million compared to 2010. SG&A expenses increased $17.1 million, primarily due to
an increase of $41.0 million related to our traffic acquisition, which was partially offset by a decline of $21.9 million in compensation
expense primarily related to reduced salaries and commission.
Depreciation and amortization increased $11.6 million, primarily due to our traffic acquisition.
Americas Outdoor Advertising Results of Operations
Our Americas outdoor operating results were as follows:
(In thousands)
Years Ended December 31,
%
2011
2010
Change
Revenue
$
1,252,725
$
1,216,930
3%
Direct operating expenses
571,779
560,378
2%
SG&A expenses
201,124
199,990
1%
Depreciation and amortization
211,056
198,896
6%
Operating income
$
268,766
$
257,666
4%
Americas outdoor revenue increased $35.8 million during 2011 compared to 2010, driven primarily by revenue increases
from bulletin, airport and shelter displays, and particularly digital displays. Bulletin revenues increased primarily due to digital
growth driven by the increased number of digital displays, in addition to increased rates. Airport and shelter revenues increased
primarily on higher average rates.
Direct operating expenses increased $11.4 million, primarily due to increased site lease expense associated with higher
airport and bulletin revenue, particularly digital displays, and the increased deployment of digital displays. SG&A expenses increased
$1.1 million, primarily as a result of increased commission expense associated with the increase in revenue.
Depreciation and amortization increased $12.2 million, primarily due to increases in accelerated depreciation and
amortization related to the removal of various structures, including the removal of traditional billboards in connection with the
continued deployment of digital billboards.
International Outdoor Advertising Results of Operations
Our International outdoor operating results were as follows:
(In thousands)
Years Ended December 31,
%
2011
2010
Change
Revenue
$
1,751,149
$
1,581,064
11%
Direct operating expenses
1,067,022
999,594
7%
SG&A expenses
339,748
294,666
15%
Depreciation and amortization
219,908
214,692
2%
Operating income
$
124,471
$
72,112
73%
International outdoor revenue increased $170.1 million during 2011 including the impact of positive foreign exchange
movements of $84.5 million compared to 2010. Excluding the impact of movements in foreign exchange, revenues increased
primarily as a result of higher street furniture revenue across most of our markets. Improved yields and additional displays
contributed to the revenue increase in China, and improved yields in combination with a new contract drove the revenue increase
in Sweden. The increases from street furniture were partially offset by declines in billboard revenue across several of our markets,
primarily Italy and the United Kingdom.