Benzinga | Sep 15, 2020 04:29PM EDT

Clear Channel Outdoor To Reduce Europe And Latin America Headcount; Sees Charges Of $21M-$24M And Pre-Tax Annual Cost Savings Over $20M

On September9, 2020, Clear Channel Outdoor Holdings, Inc. (the "Company") committed to a restructuring plan for its international division whereby the Company will reduce headcount in Europe and Latin America, partly in response to the impact of the COVID-19 pandemic on the Company's international business and the advertising industry in those regions generally. The Company is embarking on consultations with its works councils, employee representatives, unions and other relevant organizations where applicable regarding the intended reduction in force and related cost reduction and restructuring actions. The restructuring plan is expected to result in additional cost savings that will enable the Company to more effectively manage through the downturn caused by the COVID-19 pandemic. The Company expects to finalize its plans and make relevant announcements to employees on a country by country basis, and expects to complete the majority of all such announcements by the end of 2020.

The Company estimates that total charges for the restructuring plan, which includes actions already taken to reduce overall costs in the Company's Europe and Latin American businesses, will be in a range of approximately $21million to $24million, all of which is expected to result in cash expenditures. It is anticipated that the restructuring plan will be substantially complete by mid-2021 and a substantial portion of the charge will be reflected in the Company's results for the third and fourth quarters of 2020 and the first and second quarters of 2021. The restructuring charge will consist primarily of one-time termination benefits (including severance) and other associated costs. The Company expects the restructuring plan to result in pre-tax annual cost savings in excess of $20.0 million.

The Company continues to consider other cost reduction initiatives, including in the Company's Americas division, that are not included in the above restructuring plan. The restructuring charges described above are preliminary estimates and actual amounts may be materially different from these estimates. There is no guarantee that the Company will achieve the cost savings that it expects. The Company may also incur additional charges or future cash expenditures not currently contemplated due to events that may occur as a result of, or that are associated with, the Company's restructuring plan or related activities to address the impact of the COVID-19 pandemic on the Company's business.