The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Christian Schmalzl. Please go ahead.
Dear ladies and gentlemen, dear analysts, welcome back. As we've last spoken only one and a half months ago, to our Q1 2025 call. As has been common practice for many quarters now, I would like to start our presentation with an overview of our key figures, followed by important strategic topics we saw in Q1. Henning will then guide you through the financials for the first quarter. Afterwards, we will be happy to answer any questions you may have. On the main KPI for the quarter, total revenues were up by 5% reported or by 3.8% on an organic basis, from EUR 453 million to EUR 475 million. The most important message here is, once again, that we outperformed the advertising market as a whole in our core business and confirmed or exceeded the long-term trend with the growth figures for Digital Out-of-Home and Programmatic Digital Out-of-Home.
This was achieved against the backdrop of a generally rather moderate overall economic environment and a lot of uncertainty in the market. As Henning explained in the prelims, and as we will see for Q1, we have real operating leverage in our core Out-of-Home business. This manifests in EBITDA growing faster than revenue, EBIT growing almost twice as fast as EBITDA, and net income growing three times as fast as EBITDA or 6x compared to revenue growth. In total, adjusted EBITDA was up from EUR 108 million to EUR 117 million or 8%. EBIT adjusted improved from EUR 35 million to EUR 40 million or 15%. Net income adjusted increased twice as strong compared to EBIT adjusted from EUR 12 million to EUR 16 million or 30%.
In contrast to these developments, free cash flow adjusted followed the typical seasonality, especially higher working capital contributions due to a stronger liability decrease, as well as higher IFRS 16 lease repayments, led to a free cash flow adjusted of minus EUR 35 million compared to minus EUR 24 million in Q1 2024. At EUR 18 million, CapEx in Q1 2025 was 8% below the previous year's figure of around EUR 19 million and reflects the continued back to normal and the objective to further optimize and improve the fill rate of our Digital Out-of-Home portfolio. Let's have a look at the Nielsen numbers in the middle of the chart first. Please keep in mind that those show gross rate card developments, and the net revenue is on average 6-7 points lower.
On a like-for-like and gross basis, the Out-of-Home category is outperforming all other media except for radio, which is, due to its relevance, neglectable quite significantly. Out-of-Home continues winning roughly half a percentage point share per year over the German legacy ad market. Translating the gross Nielsen numbers into net revenue, in Q1 2025, not only the ad market in total was negative by around 7%-8%, net TV development should be also in that range, although RTL and ProSieben have not published their net numbers yet. In contrast, our total Out-of-Home business, Digital Out-of-Home and Out-of-Home, was up 15%. Digital Out-of-Home alone delivered 27% growth, Programmatic Digital Out-of-Home grew 36%. With that, we have outperformed TV and the ad market on a net basis by roughly 22 percentage points with a total Out-of-Home business. Digital Out-of-Home is 34, Programmatic Digital Out-of-Home more than 40 percentage points better.
That said, Digital Out-of-Home also continues to outperform the average growth rate of global platforms like Google, YouTube, or Meta, with a picture we see consistently in the last six to eight quarters, no matter what the overall ad market dynamics looks like. The underlying trend lasts, meanwhile, for more than 10 years, with the exception of the COVID lockdown. Our Out-of-Home media business has consistently outperformed the legacy media market, and within Out-of-Home media, we have been outperforming the rest of our peers. The growing share of Digital Out-of-Home has accelerated this structural development. The higher the share of Digital Out-of-Home within our business, the stronger the performance, especially against TV, print, radio, or German online players. Of course, the total ad spend defines what's achievable for us, but the structural momentum is stronger than temporary headwinds from the macro environment.
Out-of-Home was historically rather a niche and complementary medium, but it always had some kind of exceptional strong position on the KPI location within the media landscape. For many customers, location is an inevitable core function of the marketing playbook, and they are extremely stable in their revenue flows, also throughout macro cycles. A proof point here is the net revenue retention of our top 100 Out-of-Home media customers over the last 10 years. They represent roughly 40% of our core business. Even including the pandemic, the net revenue retention over the years is well above 100%, and the customer churn is below 1%. Our strong position regarding the KPI location has a substantial impact on our long-term core customers. Let's then have a look at the revenue development across our broader customer base over the years to better understand the underlying logics here.
We have again excluded the service in the non-German businesses of Blow-Up and in Poland and made a customer cohort analysis for Out-of-Home, Digital Out-of-Home in combination for all customers. You see a sticky and ever-increasing business base already in the years until the pandemic. The lockdowns, especially in 2020 and 2021, have been exceptional, but afterwards, you see the same historic trends with even more momentum. Let's look at exactly this momentum since the end of the pandemic. Digitization and the growing share of Digital Out-of-Home has added massive opportunities and improved our gameplay. Advertisers can start with smaller tickets, and the entry barrier is low, which means more new business potential. They can buy Programmatically and in combination with online, which means more natural integration with all digital media supporting a low churn.
Besides the location component, the incremental targeting opportunities open up new potential for more audience-oriented advertisers, which means we're stepping out of the niche into a mainstream proposition. You see the results in the development of our customer cohorts for Digital Out-of-Home only. Existing customers spend more money year-over-year with a net revenue retention well above 100%, and we constantly add new customers, which show the same development. This might be rather source benchmarks, but it shows the resilient and recurring structure of our top-line development year-over-year and the structural impact of Digital Out-of-Home on the total core business. Digital Out-of-Home is already a massive step up versus Out-of-Home. Programmatic Digital Out-of-Home carries even more potential. It's about informed decision-making and campaign optimization on ROI versus general traffic pattern and location demographics.
It's about highly targeted and relevant ad delivery at most opportune moments versus limited targeting options. It is about significant flexibility and responsiveness to market conditions versus pre-booking of ad space. More digital inventory, better software, and constantly improving audience data delivers a constant flow of innovation case studies. Just some recent examples from Q1. Danone was increasing their Actimel purchase intention by 38% and reached spontaneous ad recall of 60% on digital screens with a targeting strategy around rush hours, flu seasonality, and current local infection trends. L'Oréal was executing a drive-to-store push in six major cities with dynamic creatives. From a single ad template, 133 customized Digital Out-of-Home ads were automatically created and played out in the immediate vicinity of drug stores. The campaign had significant reach and a positive impact on product sellouts in the targeted drug stores.
Shop Apotheke was using our TV boost solution and data cooperation with All Eyes on Screens. The Digital Out-of-Home campaign was only played out in zip code areas with low TV penetration, and the blended campaign saw a net reach uplift of 15 percentage points versus allocating the budget on TV only. To put that into context, excluding the service and just comparing Digital Out-of-Home versus classic Out-of-Home, the share of Digital Out-of-Home roughly doubled over the last five years. Within Digital Out-of-Home, Programmatic was clearly the growth engine and has added more new business opportunities for our sales teams. Over 80% of our growth is digital. Over two-thirds of the digital growth is Programmatic. Software, as well as data quality, will be the key growth drivers going forward to monetize our Digital Out-of-Home ad inventory.
In the last two to three years, we clearly benefited from the simple fact that we had invested rather early, back in 2014, in an own SSP setup to make our Digital Out-of-Home eyeballs available to online and cross-channel DSPs and therefore bringing our volume to their demand. Today, and in the coming years, we see similar beneficial trends around our proprietary DMP setup, which we established already seven years ago, fueled originally by online data only. The DMP provides finely detailed location-specific information for the pre-qualification of inventories based on the advertisers' goals. It is the central technology for collecting, analyzing, and using data from various sources to specifically activate our ad inventory. We also see by far more engagement of advertisers in optimizing their Digital Out-of-Home creative and getting the maximum out of the inventory and available tracking data. Our AI-based creative analyzer is a fast and convenient tool.
More and more agencies and clients upload the creative via the common Power App platform. The advertising copy is analyzed based on fundamental learnings from post-campaign tracking of thousands of copies in our database, and the system immediately sends the results via email back to the client with concrete recommendations on how to improve visibility, conversion, and ROI of the ad. One important aspect for us, all of this is a long-term development, and on an annual basis or rolling 12-month basis, you see the consistent and recurring logics since the end of the pandemic. Our core business has become a double-digit growth profile. Individual quarters will always have deviations, macro-influence, volatility in the ad market, very different prior year comps. You see this on this slide for the last four years.
Quarters with more than 20% segment growth were no indicator that our business suddenly goes completely through the roof. 4% growth were no indicator for the end of the growth story. It is an ongoing structural development, which we focus on. The quarters are and will be no perfect string of spokes. So far on my remarks, and with that, over to Henning.
Thank you, Christian, and a very good morning, everybody. Let us start the final section with a quick look onto the Q1 2025 P&L, where Christian already touched upon the key items. In total, we delivered a good set of results for the first quarter and met our internal expectations for the group, while Out-of-Home media slightly exceeded our forecasts and compensated for somewhat weaker than anticipated business development at Asam.
Overall, as was already the case for financial year 2024, the momentum increases the further south we look in the group income statement. Revenue growth for the quarter was 5%. This includes around 120 basis points support mainly from the acquisition of RBL Media. The corresponding activities are included since November last year. Excluding this effect, organic growth came in at 3.8%. EBITDA adjusted amounted to EUR 117 million, EUR 9 million, or 8% higher compared with Q1 2024. The exceptional items for the quarter were EUR -2.5 million, and that is roughly half of the amount reported in the prior year period. The exceptional items essentially comprise three components: EUR 0.9 million for software implementation, EUR 0.8 million for various smaller restructuring measures, and expenses related to our stock option program. Accordingly, reported EBITDA was up by more than 10%, from EUR 104 million to EUR 115 million. Depreciation and amortization increased by 6% to EUR 81 million.
With that, reported EBIT for the quarter came in at EUR 34 million, some EUR 7 million higher compared with Q1 2024. The financial result improved to EUR -15 million after EUR -18 million in the prior year period. Roughly two-thirds of this effect are attributable to a positive currency effect from intragroup debt denominated in U.S. dollars at Statista, while the remainder results from lower interest rates more than offsetting the cost for additional EUR 80 million net debt. Earnings before taxes, therefore, more than doubled to EUR 18 million compared to EUR 9 million in Q1 of the prior year. The tax rate was basically unchanged with around 30% in the reporting period, and with that, the tax result follows the development of EBT. All in all, reported net income for the quarter came in at close to EUR 13 million after EUR 6 million in Q1 2024.
Adjustments were down by EUR 3 million, mainly because of lower pre-tax exceptional items, as described before, against slightly increased amortizations resulting from purchase price allocations following the acquisition of RBL Media, whereas part of the first-time consolidation recognized goodwill of EUR 35 million and depreciable assets of EUR 69 million. Accordingly, net income adjusted was EUR 16 million after EUR 12 million in the prior year period, or in percentage terms, an improvement of 30%. Let us now switch over to the cash flow. As you are familiar with the seasonality patterns of our business, you know that usually Q1 cash flow development is not a relevant indicator for the full year, in particular when it comes to the development of networking capital that somewhat is a reflection of the productivity of a quarter. Our Q4 usually accounts for close to 30% of annual sales, while Q1 only accounts for around 22%.
Absolute sales levels in the first quarter are usually more than EUR 100 million lower than in the preceding Q4. While earnings, as we have just seen, continue to improve and cash out for interest, other items and investments were lower than in last year's Q1. This was more than offset by the just-mentioned seasonal change in working capital, as well as IFRS 16 lease repayments, which increased also due to the acquisition of RBL Media and some phasing effects. Altogether, free cash flow adjusted was EUR -35 million after EUR -24 million last year. Compared to our calendarized forecast, our Q1 cash flow was no better than anticipated, and we continue to expect clearly improving cash flow generation for the full year and, in particular, the second half of the current fiscal year.
Let me come to the net debt development in the sequential view from the end of Q4 2024 to the end of Q1 2025. Net debt was up by roughly EUR 27 million, including the adjusted free cash flow for the first quarter of EUR -35 million and M&A expenses of EUR 1 million. The remaining difference in the reconciliation of around EUR 9 million relates to a reduction of previous customer overpayments representing a cash outflow with no effect on net debt. Net debt year-over-year was up by EUR 81 million- EUR 864 million, including our dividend payment last year, as well as the acquisition of RBL Media, representing in total a cash outflow of more than EUR 210 million. With that, our leverage ratio improved slightly compared to prior year due to higher earnings to now 2.18x versus 2.24x in Q1 2024.
Let us now take a look at the performance of the individual operating segments in the past quarter, starting with our core segment, Out-of-Home media. Out-of-Home media was able to meet and even slightly exceed the expectations placed on it for the quarter. Sales growth amounted to more than 15%, and this against a strong prior year base. Last year's Q1 equally delivered growth of more than 15%. Organic growth in Q1 was around 13% against a comp basis of 17% last year, thereby showing only slight moderation in a now, compared to the beginning of last year, much more challenging market context. Thus, our performance is characterized by rising sustainable outperformance against the market. In total, segment revenue was EUR 210 million. Looking across the different revenue streams, all of them supported growth. Out-of-Home grew classic, grew by more than 8%.
Business development was supported by the acquisition of RBL Media and a positive effect from ad spend for the federal elections. Excluding these effects, the underlying development was broadly flat. As in the previous quarters, Digital Out-of-Home was again the main growth contributor. In total, Digital Out-of-Home was up from EUR 64 million to EUR 81 million, or 27% respectively. Within the Digital Out-of-Home Programmatic Digital Out-of-Home grew even stronger with 36%. Also, Out-of-Home services contributed with double-digit growth to the segment development, and the revenue was up to EUR 30 million in Q1 2025. Consequently, the EBITDA margin for the quarter was slightly up to 41.1%, and EBITDA adjusted came in at EUR 86 million, or 18% higher compared to the prior year period. EBIT adjusted even improved by more than 50% in Q1. Q1 revenue for digital and dialogue media increased by 1% to EUR 206 million. Digital media thereby grew by 2%.
Within digital media, sales from our owned assets, such as Programmatic public video and owned internet content, such as t-online, grew or were flat, respectively, and more than compensated for a decline in ad sales for operated assets. Our dialogue business came in with revenues of EUR 108 million, and with that, basically on the same level as in Q1 2024. In detail, the two dialogue activities, call center and direct marketing, showed different sales dynamics in the first quarter. Our call center's activities grew by double digits, compensating for a sales decline in door-to-door business, which are currently facing a little higher churn in the field force. In total, the segment EBITDA adjusted came in at EUR 28 million after EUR 31 million in Q1 2024. Digital media and our contact centers contributed broadly stable earnings, earnings that our door-to-door activities followed the mentioned sales decline.
Last but not least, some comments on our data as a service and e-commerce segment with Statista and Asam. Revenue developments continue to show a differentiated picture in the first quarter. As expected, data as a service Statista continued to show positive revenue development. Sales in Q1 rose from EUR 40 million to EUR 42 million, or 5% respectively. While the outbound sales of platform access grew double-digit, our business performance in the U.S. moderated due to macroeconomic headwinds. Asam's business development was still impaired by declining trading and wholesale distribution to China in the amount of roughly EUR 3 million in the period under revenue. Excluding that, sales were broadly stable in a now more challenging consumer environment. EBITDA adjusted for the segment was EUR 11 million, or EUR 1 million lower when compared with the prior year period.
The good earnings and margin improvement in Statista could not fully compensate for earnings decline at Asam. With that, let me hand you back over to Christian for the outlook and some closing remarks.
Before ending the presentation, let me just have some comments on the outlook for Q2 and the current trading momentum. The developments we expect for Q2 have all to be seen in the light of the strong comps of Q2 2024 prior year developments driven, i.e., by the EUFA EURO 2024. For example, Out-of-Home media was up by 21% same quarter last year. Furthermore, there is still unchanged uncertainty in the market that leads to an ad market dynamic, which should be definitely softer than the Q1 environment.
Against this background, we expect revenue growth in our core business for the period April to June of up to 5%, as the quarter has not ended yet and as June is quite a decisive month for the quarter. We are quite constructive for our expectations. This growth will again be driven by continuous and sustainable strong momentum Programmatic Digital Out-of-Home and Digital Out-of-Home overall. For digital and dialogue, we see stable revenue developments for Q2. Stores and e-commerce should be up single digit, driven by Statista. Going forward, the second half of the year will accelerate significantly as high and low double digit. As we highlighted in the first part of the presentation, individual quarters might be above or below our current momentum. We are running against tougher comps in the first half of the year.
We are running against softer comps in the second half of the year. We have the volatility in Q1 and Q2, but our long-term CAGR expectation for the core business is double digit. With that, full year guidance for 2025 remains unchanged. Let me now close the presentation with a short look into our financial calendar for 2025. The next event will be our AGM on June 4. The half-year figures will be presented on August 13, and Q3 figures will be published on November 11. As always, updates, reports, and roadshow presentations can be found on our investor relations website. Thank you, everyone. We are now happy to take your questions.
We will now begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. You will hear a tone to confirm that you have entered the queue.
If you wish some of yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. Anyone who has a question may press star and one at this time. The first question is from Johnen Christopher, HSBC. Please go ahead.
Yes. Morning, everyone. Thanks for taking my questions. A couple from my side, please. First, starting with Statista. What is your view on sort of the expectations we should have for the rest of the year? I'm looking at consensus expectations of roughly mid-teens growth for the entirety of the year. Now, Q1 with roughly 5% being somewhat below that. Is there anything you can share on your expectations for the—I don't want to call it seasonality, but really the sort of uptake to be expected or not at Statista? That would be the first question.
Second, I'm curious, is there anything you can share with respect to the conversations you've had about the—I know you don't want to call it the sales process for Out-of-Home, but you know what I'm talking about—just to see if there is anything to be shared, maybe any of your own timeline even, that would be interesting. Third question, with respect to the non-Out-of-Home media business. I'm just curious, have you noticed that there's volume declines coming in from Google, maybe on lower search volume, either, for example, at t-online or some of the other third-party media that you're seeing? I'd be curious to see or hear what you have to—what you have to share on that. Thanks.
Thank you, Christopher. Let me start with your question on Statista.
I think, basically, you're talking about the mid-teens, which is also, I would say, our target if you look into our internal forecast. We originally also foresaw that there will be, let's say, an acceleration in growth in the second half. What is currently a little bit challenging, as I indicated in my speech, is the environment in the United States. We see a little bit of macro headwinds, as I indicated. That has, I would say, put some more, let's say, risk to our original forecast. We need to see how that continues. Regarding the underlying development, we are rather quite happy with the performance as we see it at the moment.
On your third question regarding Google traffic, I would say on the news portals that we have, but that we also see in the market, we do not see any impact on search volume or organic traffic at the moment from Google. Nothing like a trend that could be, I do not know, linked back to AI stuff or any fundamental changes. You always have some kind of normal volatility based on how they are working on their algorithm in general. There is nothing that we have seen, especially in the last two or three months. I would say rather the opposite. I think, especially the first quarter was traffic-wise really strong for t-online, especially versus Q1 last year. At the same time, what we have seen is more volatility in the last two or three quarters on any more specific content beyond news and general interest.
That's where also a couple of our third-party publishers have been suffering. Automotive, I think, was one area that just saw less traffic volume coming in. I think it's a bit too early to say if there is any underlying trend. I think any kind of bigger shifts one would expect are not visible yet. I would say the business dynamics there is more driven by advertisers' demand than by overproportionate changes in traffic structures. That's at least what we've seen in Q1 and what we see at the moment. I don't think that the Q2 trend would be any different. I think on your second question, a potential sale of our core business, I think we can only repeat what we said during the prelims.
I mean, there was some leakage about what we do in general regarding looking at leveraging the inner value of our company total. As we said, we got some additional inbound requests of investors that are generally interested. We are working with those on potential questions to make sure that interested parties have a good understanding of our business. There is no process agenda timing or anything like that. We are always open for opportunities, but we ourselves are not setting any pressure or expectations or timings. I think, as you see, the market environment is, in general, a little bit tricky. Doing something in such a phase is probably not something you have normally on your top priority list.
Understood. Maybe one follow-up on the last point, just to confirm, maybe it's kind of a legal question.
I understand if you ad hoc the leak that we've had a couple of months ago, am I right thinking that you would also have to put out an ad hoc at the moment where you are no longer talking to any party? Is that correct?
No. No, no. We don't have to go ad hoc for that because, obviously, when you go ad hoc, then it means you're relatively close to do a transaction. Over time, this is actually fading out. Legally, we are not obliged to, only if we would be really close to a transaction. Now, we have to go ad hoc again. As Christopher said, there's nothing to add from our last statement. It's obvious that there are several players in the market who see the value of our core business significantly above the valuation of the whole group.
This is actually obliging the management to evaluate options, how to unlock the full potential on the valuation side of our portfolio of assets. We are in conversations, and that's it. At the moment, if there's something new, we're going to inform the market.
That's clear. Thanks a lot. Appreciate it.
Thank you. Next question comes from the line of Craig Abbott, Kepler Cheuvreux. P lease go ahead.
Yes. Hi. Good morning. Two follow-ups from my side, please. Just getting back to Statista first. I mean, you mentioned twice that you've seen some headwinds in the U.S. You alluded to economic conditions. I would like to know, is this maybe more a reflection of research budgets in the U.S., obviously coming under pressure from the administration? If maybe that's more of a structural issue there.
Just to follow up, just to complete that question, please, on Statista, could you update us on what the U.S. share of Statista's business is currently? Then I'll ask my second question. Thank you.
Hi, Craig. Thanks for your questions. By the way, we have an anniversary today, the two of us. Yeah. It is our joint 50th quarterly results presentation. I think. Really? Yeah. Anyway, we have the two veterans here, of course, apart from Udo. I think on your question around U.S., I think there is, in general, and you could see that, I think, also in the published number based on feedback we get also from our sales teams of Statista, a more conservative approach in spending money at the moment from companies.
I think they're just a bit unsure what all the tariff means and what long-term learnings around macro means for the U.S. business. I do not see that there is a bigger structural topic or anything like that. It is really the market momentum at the moment. I think it is also more like the uncertainty in itself than really underlying problems. That is why we think we will see what the next couple of weeks and months are. I think it has already got a little bit better as people understand that maybe ultimately it is also for the current president about the results. I think it is more like a temporary uncertainty in the market based on what we see at the moment. Nothing has been canceled. We see that the lead times for selling things in the U.S. take longer. Things get a little bit postponed.
That's a little bit where the logics come. I think the U.S. business in total is close to 40%, around 40%. It is an important market for us. It is also an important part of the growth going forward because I think we are in a good position there, have built good teams. We have a new CEO in place since a couple of months. She's really doing excellent work there. We're happy with that. That's why, indeed, the U.S. is an important building block of our Statista growth story.
Okay. Thank you. Here's to 50 more joint quarterly calls. I hope, to be honest, that's it.
Yeah. We'll see. Yeah. Just the second question, please.
Getting back to the four-year guidance, I understand H2 last year, you have more favorable comps, I think, what, 3-something percent growth in Q3, Q4.
Things will get easier then. Your Q2 outlook was encouraging considering the very high comp from the Eurocup last year. Nevertheless, I just wonder what makes you so confident that you'll really see that kind of growth in the second half of the year. Usually, you do not have that much forward visibility. Yeah. If you could just maybe add a bit more color there. Thanks.
What's the key fact why we are confident? I think the key fact is that our quarterly revenues in Q1 and Q2 at the moment follow exactly our internal plan, which was made already at the end of last year.
To be honest, we have not foreseen that the ad market, and I mean, I can still speculate only about the ultimate net numbers, especially for Q2, but I think all the legacy media together, including Out-of-Home, in the total pot in the first half of the year will be probably around, our guess at the moment, - 8% or so. We have been making our plan on the basis of having at least a flattish ad market this year. Against strong comps and against the significantly weaker ad market that we had expected, we have pretty much spot on with our current H1 performance. That is why we think what we have communicated is absolutely realistic because we do not think going forward that kind of difference between where the ad market is versus what we have been expecting gets worse than in the first half of the year.
I think that's what we tried to communicate in the overall presentation. Yes, of course, macro environment, ad market development has an impact on what's achievable for us. We just see almost quarter by quarter that that kind of structural resilience of our business affects that the tailwind through Digital Out-of-Home is so much stronger versus all the temporary headwind from the macro environment that I would say we feel more and more comfortable with what we do.
Craig, maybe you see on the second view that we published some new data today, especially about the resilience of our revenue intake. The first view was always that advertising is cyclical and stuff. If you look on the net revenue retention, it's above 100% from our top 100 clients. I think this is really, really strong numbers and churn below 1%.
These are actually numbers from the SaaS business, and this over the last 10 years. You see that the projection is quite reliable, what we have, because our customers are constantly investing more in Digital Out-of-Home. We see that momentum is actually definitely building up. That is why we are a bit, let's say, independent from what you would guess to see as a cyclical development.
Okay. Thank you.
Also, maybe have a look on the cohorts of our customer cohorts. Also quite interesting. If you combine that, these net revenue retention numbers and the customer cohorts, you get first time a very strong impact on how sustainable our revenues are.
Okay. Thank you very much.
Next question comes from the line of Annick Maas Bernstein. Please go ahead.
Morning. My first question is on the margin of dialogue and digital.
You made some comments around it, but I'm just thinking the online bid was doing well, dialogue business was doing okay, yet margin went down. We have also this argumentation that you are offshoring your call centers. Can you just go a bit more into the detail what happened with the margin there and how you think about it for the rest of the year? The second one is on Asam International. I thought we are now past the comp of Asam International. Just mechanically, it should do better. Can you just give us an indication of where we are, what share Asam International is doing now out of the mix? The last one is, I guess, a follow-up on the previous one, just on the advertising revenues for the full year. You have some multi-year contracts.
You have some contracts that are negotiated at the start of the year. How much of your Out-of-Home budgets do you have already more or less logged in for the full year? Thank you.
Anik, on the question of the margin and dialogue, as I said in the speech, I mean, basically, I talked about a good sales performance in the call centers. That was also driven, as you indicated, out of better outshoring. The margin in the quarter was not already following through at this point because there is also some, let's say, costs for setting up more outsourcing capacity. We are quite confident that going forward, we will see at least, I would say, a sales development that is more in line with earnings.
Most of the, let's say, the decline in earnings in that segment was essentially coming from Ranger, our door-to-door activities, which can always be a little bit volatile from one quarter to another. As you know, here, we're working with external independent sales organizations, and those folks at the moment have a little bit higher churn when it comes to their workforces. We are working with the measure plan on that, and we expect that to improve going forward. We are keeping our forecast for Ranger and also the call centers. We are quite, I would say, constructive here also for the business going forward. Your second question on Asam. Asam, technically, you're right. Yeah.
As soon as we had completely opted Q1, Chinese business more or less out of the system, at least with the volume that came extremely fast in 2023, 2024, it should get, what's the word, mechanically easier. Yes. Yes, you're right. Because then I think anything outside the DOC reason should be down share-wise to around 15%, 15%, and it's widespread across marketplaces, more opportunistic, some smaller dealer deals. I think it's something where you wouldn't see much volatility. That said, it's getting easier, but it all goes back to the DOC region and the momentum there. Clearly, in the current environment, it's not that easy for consumer brands. I think Henkel was publishing their numbers this morning. I think their cosmetics business was going backwards.
You see that kind of uncertainty in the market at the moment that we also see in the DACH region is clearly something that is not supporting the general development in DACH. I think Asam in Q1 was in the DACH region based on these numbers, still winning market share in all of their categories without an exception. Relative to the market, I think they're doing fine. Yes, technically, mechanically, against comps without a special impact of China, it's getting easier, but it will be ultimately heavily impacted by the overall environment for consumer brands.
On your Out-of-Home question, I think it's a little bit a technical question because when you, as what Udo mentioned, if you look at the end of every year at the development of customer cohorts and existing customers and what they did, you would say the historic logics would be ultimately and at the very end, we know pretty much what we get based on what the customers have done in the last years. Technically, in our books like finally contracted for the second half at the moment, in total, we probably have 30%-35%. Why? Because a lot of national advertisers have an annual deal and commitment, but technically, they book it quarter over quarter, month on the month over month. There is the next on top of 30%-35%, there is the next 60% contracted in annual deals, but not physically booked.
There is the last 5%-10% coming out of a new business pipeline, which we have drilled down quarter by quarter on a very granular level. Part of that is also normal sales work. What you have ultimately is that you begin at the end of the year with the precise knowledge of what customers have done last year, what their behavior was over the last 5 years-10 years, and what they have contracted, already booked, plus contracted or committed. You work on that. You reduce that kind of delta between what is technically in the order book and where you want to be at the end of the year.
If you then make a backwards analysis year-over-year, you see that it follows some kind of logics that is very close to as if customers would have booked a five-year subscription with us.
Okay. Thank you very much. Next question comes from the line of Julian Röhr from Barclays. Please go ahead.
Yes. Good morning, everybody. I'm going to be greedy. I'm going to ask four questions. The first one is on free cash flow. Leases were up in Q1. You say it was RBL plus seasonality. Can we have some indication of IFRS 16 leases for the full year? It was EUR 203 million last year. While we are at it, Henning, if you could give us some indication of CapEx, cash exceptional, and cash interest. Four numbers.
Second question is what percentage of Programmatic advertisers are incremental, i.e., if you did not have Programmatic, they would not advertise on your properties. Third question is on macro. Christian, you said that you thought that the first half for traditional media, including outdoor in Germany, would be down 8%. Can we have a split between Q1 and Q2? Lastly, for Udo, I guess Out-of-Home is amazing. You always said that your business is undervalued. Clearly, if it was a business doing double-digit top line, it would be valued far more. Should you sell everything except digital and Out-of-Home? I know you have plans for Asam and Statista, but why not sell dialogue? Can you tell us strategically whether you think it is a good idea and kind of timing of the disposal of those three assets?
Thank you. Hi, Julian.
Maybe I start with the question. I think it was number three, macro context at market split H1 in quarters. Again, it is what we see, how we have backwards compared always gross Nielsen numbers with net numbers across media. I think the first quarter should be around 6.5%-7% negative. The second quarter probably up to - 10%, roughly. That is our estimate based on what we see. I would say the kind of indicators for May are not substantially changing June. Definitely Q2 softer than Q1. Q1 total at market on - 6%, -7% leads to -1 0%, roughly, in Q2. The second question around, what is really incremental Digital Out-of-Home revenue via Programmatic versus what would we have if there was no Programmatic? It is a philosophical question to imagine a world without Programmatic.
Our guess is that at least one-third up to half of the Programmatic volume over the last three to four years was really incremental. Why? Because it has opened up new customers that really came via the trading desk and the online logics. We saw that especially short-term bookings were very often at the end of the quarter triggered with that. Thirdly, there is a share of customers that simply replicates their targeting profiles from the online world into Digital Out-of-Home. All of that would not have happened without Programmatic public video. That said, the more we are going forward, the more Programmatic is established, I think. The people learn that it is not about the way only they buy, but it is about the proposition of the media itself.
I think the more you could say that it's an established tool in the plan, it might also come without Programmatic. The other way around, it's so automated, so Programmatic, so easy and convenient, so that it ultimately also drives the incremental business. I would say a third of what Programmatic does, maybe up to a half, two, three, four years ago, is volume that we would not have today without Programmatic sales on.
Julian, on the question of lease liability repayments, we have seen an increase, I think, of around EUR 8 million in the quarter. I would say roughly one quarter of this is coming from RBL. Up to EUR 3 million-EUR 4 million is probably some phasing effects. There is always a little bit shift from one quarter to another.
The rest, so maybe let's say EUR 2 million-EUR 3 million, is maybe underlying increase from increased guarantees and additional contracts as a rough idea. For the cash interest, I mean, we have seen an improvement now in the quarter. I think we expect also an improvement for the full fiscal year, basically coming from now moderating interest rates, probably in the direction of the relative improvement that we have seen in the quarter, maybe a little bit less, right? Because we have to see that given our dividend decision, it's probably fair to say that net debt will rather rise a little bit year-over-year. Some of these lower interest effects will be compensated by somewhat higher net debt. I hope that helps.
The last question on selling Asam, Statista, and Dialog to become pure play?
Ultimately, I think we try to leverage the full inner value of the company. I think if you think for a moment about selling Asam and Statista, it's a fair question to see if the Dialog business is part of the core or not. I think the fact that we had interest for private investors in Out-of-Home and online in combination is some kind of answer that the Dialog business is close to that advertising business, but it's the separate one. I think the key question goes back to what I think Christopher asked, and where are we in any kind of process? I think we are open for any kind of inbound interest. In the current environment, we have no concrete plans. I would not say this is what we do because you immediately trigger expectations from you guys.
I think that is part of the challenge that we have. We already have the challenge that we have to explain a lot around quarterly developments when we feel like the annual momentum is by far more important. I think we do not want to complain because we are publicly listed. It was a decision, and that is what it is. I think in the long run, there is an Out-of-Home business and an online business which is close to that, which is already a little bit different. You have a Dialog business, you have Statista, and you have Asam. I think there are many good reasons why the individual development potential of those businesses could be maybe done in a more interesting way in separate logics.
Definitely our target is to unlock the value of what I already said. We are not in a hurry. Obviously, circumstances are very relevant at the end for valuations. We have very low debt. We have well-performing businesses. We are actually evaluating different options. We repeat a little bit ourselves here. It is obvious that there is no benefit today from having the businesses we have in one portfolio. Our shareholders are not benefiting from that. There are different options to change that. This is also clearly, as Christian said, connected to opportunities which are linked to macroeconomic situations. I mean, the current situation will not stay forever. All this tariff unsecureness will be finished most likely in the next four, five, six months. Interest rates will go down. All of that will actually accelerate the M&A market. That is what capital markets are expecting. It is also our expectations.
Right now, people are waiting until the tariff war is finished. M&A markets, you also see in real estate now, market is coming back. We definitely believe that M&A and financing conditions will be much better in the second half of the year than it is today.
Okay. Thank you.
You're welcome.
Next question is from Nizla Naizer , Deutsche Bank. As a reminder, for questions, please press star and one. Please go ahead, Naizer.
Thank you. I have two final questions remaining. Firstly, I just wanted to clarify your commentary on your full-year guidance. You've mentioned the revenue sort of trajectory, but are you saying anything around the margin trajectory or profitability growth for this year? Sort of a wrap-up on that would be great.
Lastly, on advertisers' behavior, did you see a direct impact as soon as sort of Liberation Day happened in terms of how your advertisers reacted? Did that sort of bounce back to normal? Some color on what you're seeing either on Out-of-Home and digital would be great. Was there also a difference in maybe the behavior among your local and regional clients versus your national clients where one was more sort of resilient than the other? Some color there and your expectations on how these parties would behave for the rest of the year would be great. Thank you.
Hi, Nizla. Maybe I start with your second question. I think just by nature, short-term macro environment has normally no impact on the order book or the order intakes from local and also regional customers. They're anyway planned.
Their marketing spent more long-term and rather driven by their very individual situation. There is nothing we've seen. We also haven't seen that kind of D-Day logics where Liberation Day and people just pull out money. I think what we've seen, just explaining a little bit the kind of emotional roller coaster in the ad market or for our sales organization, we've been coming last year out of a really strong H1. Then suddenly we're moving into a foreigner situation where there was the Trump election where everyone felt like that could be a challenge for Europe and Germany. The perception was like, "Okay, I have 100 bucks. 100 go to the U.S.." At the same time, we had suddenly the German government almost falling apart with an unclear situation how quickly new elections will be. That led to a really soft momentum overall in Q4.
Suddenly, as soon as that first, I don't know, Trump effect was over and there was a date for the German election, there was again very positive momentum over a couple of weeks, which led to a really good Q1. During Q1, you could see that people realized that we might have a government, but the problems won't go away immediately in Germany. We will need to see how that all works out. You had that tariff discussions out there. Suddenly a very positive momentum in Q1 turned into more skepticism. At the moment, we see another turning point where we see, okay, people understand that the kind of Armageddon scenario around tariffs and others is probably it was for a while on the table.
It goes more towards solutions and you see more positive momentum going forward, which just improves a little bit the outlook again. It is this up and down. It is not individual days. It is more like overall sentiment over the months along the stuff that happens around the world. It is more influencing our national advertising market than our local one. I would say, as we have one national ad market, it influences digital and/or the online business and Out-of-Home in a similar way with one difference. Out-of-Home is just higher up on the priority list of advertisers. We say that it gets less impacted if advertisers are really a little bit more conservative on the spending for the next two or three months.
On your question on the full-year guidance, Nizla, basically confirming the guidance as we mapped it out in the outlook of the annual report, we see somehow, I'd say, organic growth was more or less on the level of 2024. We expect EBITDA obviously driven through the performance of Out-of-Home. Like seen in Q1, also in terms of the dynamics, we should see accelerating dynamics the more south you go in the P&L and also for the free cash flow generation. Unchanged. I think the guidance that is there is fairly consistent, I think, with the overall consensus as I look at it at the moment.
Thank you. Very helpful.
The next question comes from the line of Anne Patrice from Berenberg. Please go ahead.
Yes. Hello. Good morning. Thank you for the presentation and all the information already provided.
I probably missed just a couple of questions on my side. On the organic growth of the Out-of-Home, if we exclude the impact from the acquisition, what would be the growth within the classical Out-of-Home and digital? Or what was the contribution across the two from the acquisition? That's the first question. Second question, how much exactly was Programmatic within Out-of-Home in Q1 2025 and Q1 2024, if it's possible, in EUR millions? From there, I have another question on Dialog and Digital. It seems that most of the growth has come from Programmatic. How much was the t-online up? How much were the rest of the websites down? It means quite a significant decline, if I'm playing around with the numbers. Why did the divergence trend between your website or the t-online and the rest of the website portfolio?
What are you doing so special within t-online? What is not so good with the other websites? Are they just following the overall market decline? Is there something outperforming that you are doing special with t-online? Two more questions from my side. One on the CapEx. If you could provide a bit more breakdown on how much you spend on the digitalization of your portfolio. What should we expect going forward on the CapEx side, how much it should be this year and maybe the midterm trends? There was a peak when you were spending more on the digitalization. Is this over? In terms of the inventories, there is still a very low share of inventory that is digital. Why then is the CapEx declining? If you could explain that. The last, quite easy question and very theoretical question.
If you divest the non-core assets, what would you do with the cash cassettes? If you have any ideas already. Why do you think it takes a bit longer to divest them? Because you have been talking about it for quite some time. Is it that there is no interest, or is it because you expect the price to be offered to be much better than people offer now? What do you think will be the right price for these assets?
Thank you. I do not know. Let me take the last question maybe first. There are a lot of questions, but let me maybe take the last one first so we can have some more time to check out the data. As I already said in the last set of questions here, it is obviously always depending on valuations and circumstances.
Look, we are in a very comfortable situation. We have a portfolio of high-quality assets, and we have a very low indebtedness. There is no reason for us to push a deal forward in a situation what we have now in the first half year of 2025, where you have maximum uncertainty if you compare with the last five or six years after Trump got into office. That is very simply said, the situation. I mean, financing was expensive in the last year. After Corona, there was a lot of different problems coming up in the market, in the M&A market, in capital markets, and in the debt market. We expect all of that coming down step by step because what I already said five minutes ago, the tariff stuff will not last forever.
We expect in the last six months, the situation to change significantly in the debt market as well as in the overall macroeconomic situation, which means uncertainty will come down. That is simply the reason why we did not push any deal forward. Why should we do that? I mean, losing hundreds of millions of EUR for our investors only to execute a deal in a situation where it makes no sense. In the first quarter in Germany, there was not one single IPO. If you push an M&A deal forward, then only if you are really desperate or if you urgently need money. We do not need money. I already said our indebtedness is on record low all-time level for the first quarter. If we would not have bought RBL Media last year, the leverage would be under two now.
Clearly under our target leverage from a minimum of two and a half. That is the situation. In case we make a deal, we return the money to the shareholders because what I already said now, the indebtedness is really low. The company is producing a lot of cash. That is the situation. We're really focusing on our key target this year that we see that the stock price is not reflecting the value of our assets. You saw the leakage. There were offers or, let's say, there were people coming towards us with numbers which were communicated in the press so significantly for the core business above what we see for the whole group now. That is why there are these communications. We are completely relaxed, and we wait until we get the best possible results for our investors.
We are not nervous on quarters or six months. That is the situation. I hope this answered your question.
Okay, Anna. Let's say to the question more on the number side, your question, as I understood, was on organic roles in Classic. I mean, we reported 8% growth in Classic, as I said in the speech. Organic roles out of these 8%, what I would say is probably in an area of 5%-6%. That was mostly also supported by business around the federal elections. The underlying contribution from the acquisition was then like 2%-3% of that growth or 2%-3%, let's say, one quarter to one-third of the growth recognized in Classic. On Programmatic public video, the absolute amount of sales generated in Q1 in that revenue stream was round about EUR 30 million, EUR 30 million.
If you look at the consolidation position of group sales, that is usually a very good indicator for the Programmatic public video sales. The prior number was around 22, 22. 30 against 22 is on Programmatic public video. You had a question on the different dynamics within the digital media business. I think Christian already had that question and answered it before. We saw actually, I'd say, a better sales trend when it comes to t-online, which is our owned assets, where we sell actually internet ads on our own property. This is, as you know, the German news media platform. We had some pressure on the business where we rather work with third-party publishers and sell ads on their inventory. These are basically not general, but rather more special interest news outlets. That was a bit tougher.
It is probably also consistent with the tough online ad market development as we mapped out. Also, in one of our first charts, you see that the online ad market in Germany was also going south a bit. On CapEx, basically what we said for the full year is that we rather expect slightly increasing CapEx. I think now CapEx being down in Q1 should not be seen necessarily as an indication for the year. We will also still have to apply some CapEx on the assets of RBL to finalize the build-up of the inventory. The expectation for the full year will be a slight increase in CapEx. The notion that we are stopping our, let's say, expansion or investment in Digital Out-of-Home is incorrect, right? We had a peak of investments, I think, coming out of the pandemic.
Since then, I would say we are applying a more opportunistic expansion approach. We have tried to find the right balance between building up new inventory and getting utilization on the existing inventory up. This is, I think, the strategy for quite some time. I think we continue to follow that going forward. To be honest, I— That was it? That was it? Or is there anything we have missed?
There was a lot already. Thank you very much. On the CapEx, maybe you can provide a bit more split, how much do you spend on digital and how much do you spend on the rest, or how much do you do the—
We are not providing CapEx split by segment. We talk about the group CapEx. It is fair to assume that, I would say, more than 50% is Out-of-Home.
I'd say within Out-of-Home, at the moment, we're probably rather at 50/50 share in terms of, let's say, main.