Clear Channel Outdoor Holdings based in San Antonio TX is a global leader in outdoor advertising displays in countries across continents. In the United States the company operates advertising displays and has a presence of the top DMA regions. It manages a large portion of Spectacular Displays in Times Square as well as Airport Taxi and Mall advertising worldwide. Adshel is the company\'s International street furniture division. Clear Channel Outdoor Holdings Inc. has a market cap of $2.38 billion; its shares were traded at around $6.7 with a P/E ratio of 335 and P/S ratio of 0.72.
Highlight of Business Operations:During the second quarter of 2009, we recorded a $21.3 million impairment to taxi contracts in our Americas segment and a $17.5 million impairment primarily related to street furniture and billboard contracts in our International segment. We determined fair values using a discounted cash flow model. The decline in fair value of the contracts was primarily driven by a decline in the revenue projections. The decline in revenue related to taxi contracts and street furniture and billboard contracts was in the range of 10% to 15%. The balance of these taxi contracts and street furniture and billboard contracts after the impairment charges, for the contracts that were impaired, was $3.3 million and $16.0 million, respectively.
The discount rate used in the impairment model increased approximately 50 basis points over the discount rate used to value the permits at December 31, 2008. Industry revenue forecasts declined 8% through 2013 compared to the forecasts used in the 2008 impairment test. These market driven changes were primarily responsible for the decline in fair value of the billboard permits below their carrying value. As a result, we recognized a non-cash impairment charge in all but five of our markets in the United States and Canada, which totaled $345.4 million. The fair value of our permits was $1.1 billion at June 30, 2009.
On January 20, 2009, CC Media Holdings announced that it had commenced a restructuring program targeting a reduction of fixed costs. For the three months ended June 30, 2009, we had recognized approximately $8.1 million, $0.1 million and $1.9 million as components of direct operating expenses, selling, general and administrative (SG&A) expenses and corporate expenses, respectively, related to the restructuring program. For the six months ended June 30, 2009, we had recognized approximately $13.0 million, $1.0 million and $3.0 million as components of direct operating expenses, SG&A expenses and corporate expenses, respectively, related to the restructuring program.
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