Clear Channel Outdoor Holdings, Inc. (NYSE: CCO) today reported results for its second quarter ended June 30, 2008.

The Company reported revenues of $914.8 million in the second quarter of 2008, a 9% increase over the $836.7 million reported for the second quarter of 2007. Included in the Company’s revenue is a $52.2 million increase due to movements in foreign exchange; excluding the effects of these movements in foreign exchange, revenue growth would have been 3%. See reconciliation of revenue excluding effects of foreign exchange to revenue at the end of this press release.

Clear Channel Outdoor’s operating expenses increased 14% to $641.3 million during the second quarter of 2008 compared to 2007. Included in the Company’s 2008 expenses is a $41.1 million increase due to movements in foreign exchange; excluding the effects of these movements in foreign exchange, growth in expenses would have been 6%. See reconciliation of expenses excluding effects of foreign exchange to expenses at the end of this press release. Also included in the Company’s 2008 operating expenses is approximately $3.5 million of non-cash compensation expense. This compares to non-cash compensation expense in operating expenses of $3.0 million in the second quarter of 2007.

Clear Channel Outdoor’s net income and diluted earnings per share were $80.3 million and $0.23, respectively, during the second quarter of 2008. This compares to net income of $68.6 million or $0.19 per diluted share in the second quarter of 2007.

The Company’s OIBDAN was $259.5 million in the second quarter of 2008, a 1% decrease from the second quarter of 2007. The Company defines OIBDAN as net income adjusted to exclude non-cash compensation expense and the following line items presented in its Statement of Operations: Minority interest, net of tax; Income tax benefit (expense); Other (expense) income - net; Equity in earnings of nonconsolidated affiliates; Interest expense; Gain on disposition of assets - net; and, D&A. See reconciliation of OIBDAN to net income at the end of this press release.

"Our ability to deliver revenue improvement in the second quarter and first half of 2008 demonstrates the strength of our business as well as successful execution across our operations worldwide. While visibility is limited for the second half of the year, we are on track with our long-term strategy for growth. As we continue to invest in the digital platform, we should reap the rewards of the geographical diversity of our platform and premium positioning," commented Mark Mays, Chief Executive Officer of Clear Channel Outdoor.

Paul J. Meyer, Global President and Chief Operating Officer, commented, “In the Americas, despite growth in our national business, the decline in our local business, coupled with significant lease cost increases from major new contracts continued to pressure our cash flow. Core expenses were well controlled, and we continue to be encouraged by the performance of our Latin American markets and our U.S. digital networks, both of which produced strong operating cash flow. Internationally, we had strong results in China, Australia and our Northern and Eastern European Region. However, these results were offset to some degree by declines in the UK and early signs of a softening in some of our European businesses.”

The Company’s 2008 revenue and direct operating and SG&A expenses increased approximately $52.2 million and $41.1 million, respectively, from foreign exchange movements during the second quarter of 2008 as compared to the same period of 2007.

See reconciliation of OIBDAN to net income at the end of this press release.

Americas

Revenue increased approximately $8.1 million during the second quarter of 2008 compared to the second quarter of 2007, primarily from increases in airport and street furniture revenues as well as digital display revenue. The increase in street furniture revenue was primarily the result of new contracts and increased rates while the increase in airport revenue was due to new contracts and increased rates and occupancy. Digital display revenue growth was primarily attributable to an increase in digital displays. Partially offsetting the revenue increase was a decline in bulletin and poster revenue. The decline in bulletin revenue was primarily attributable to decreased occupancy while the decline in poster revenue was primarily attributable to a decrease in rate. Leading advertising categories during the quarter were retail, amusements and financial services which all experienced revenue growth for the second quarter of 2008 when compared to the second quarter of 2007. Revenue growth was led by Los Angeles, Boston, Latin America and Canada.

The Company’s Americas operating expenses increased $20.1 million primarily from higher site lease expenses of $15.7 million mostly attributable to new taxi, airport and street furniture contracts. Administrative expenses associated with various legal expenses also increased during the quarter.

International

Revenue increased approximately $70.0 million, with roughly $50.1 million from movements in foreign exchange. The remainder of the revenue growth was primarily attributable to strong growth in China, Turkey and Australia and due to the Company’s Romanian operations which were acquired at the end of the second quarter of 2007. Growth was partially offset by revenue declines in France, due to the loss of a contract for advertising on railways, and the United Kingdom.

Operating expenses increased $57.5 million. Included in the increase is approximately $39.5 million related to movements in foreign exchange. The remaining increase in operating expenses was primarily attributable to an increase in site lease expenses and other operating and selling expenses associated with the increase in revenue.

Digital Conversion

The Company installed 47 digital displays during the quarter, compared to 31 during the same period last year. With the addition of 19 units in July, the Company has installed a total of 100 units through the first seven months of the year. The Company expects to install in excess of 150 digital boards in 2008.

FAS No. 123 (R): Share-Based Payment (“FAS 123(R)”)

The following table details non-cash compensation expense, which represents employee compensation costs related to stock option grants and restricted stock awards, for the second quarter of 2008 and 2007:

Current Information and Expectations

The Company has previously provided information regarding its revenue pacings and certain expectations related to 2008 operating results. That information was last provided on May 9, 2008 and has not been updated. The Company is not providing such information in this release and does not anticipate providing this information in the future. The Company will not update or revise any previously disclosed information. Investors are cautioned to no longer rely on such prior information given the passage of time and other reasons discussed in the Company’s reports filed with the SEC. Future results could differ materially than the forward-looking information previously disclosed.

The Company periodically reviews its disclosure practices in the ordinary course of its business and management determined to cease providing this information after taking into consideration a number of factors. There should be nothing read into the timing of this change in policy, nor should any inferences be drawn relative to internal or external economic factors.

Income Taxes

The effective tax rate for the three months ended June 30, 2008 decreased to 33.6% as compared to 40.2% for the three months ended June 30, 2007, primarily due to an increase in Income before income taxes and minority interest in certain foreign jurisdictions that resulted in a lower overall effective tax rate in 2008.

The Company defines non-revenue producing capital expenditures as those expenditures that are required on a recurring basis. Revenue producing capital expenditures are discretionary capital investments for new revenue streams, similar to an acquisition.

Liquidity and Financial Position

For the six months ended June 30, 2008, cash flow from operating activities was $246.1 million, cash flow used by investing activities was $217.7 million, cash flow used by financing activities was $86.4 million, and the effect of exchange rate changes on cash was $4.8 million for a net decrease in cash of $53.2 million.

Leverage, defined as total debt including debt to Clear Channel Communications, net of cash, divided by the trailing 12-month OIBDAN, was 2.4x at June 30, 2008.

Supplemental Disclosure Regarding Non-GAAP Financial Information

Operating Income before Depreciation and Amortization (D&A), Non-cash Compensation Expense and Gain on Disposition of Assets – Net (OIBDAN)

The following tables set forth Clear Channel Outdoor's OIBDAN for the three months ended June 30, 2008 and 2007. The Company defines OIBDAN as net income adjusted to exclude non-cash compensation expense and the following line items presented in its Statement of Operations: Minority interest, net of tax; Income tax benefit (expense); Other (expense) income - net; Equity in earnings of nonconsolidated affiliates; Interest expense; Gain on disposition of assets - net; and D&A.

The Company uses OIBDAN, among other things, to evaluate the Company's operating performance. This measure is among the primary measures used by management for planning and forecasting of future periods, as well as for measuring performance for compensation of executives and other members of management. This measure is an important indicator of the Company's operational strength and performance of its business because it provides a link between profitability and cash flows from operating activities. It is also a primary measure used by management in evaluating companies as potential acquisition targets.

The Company believes the presentation of this measure is relevant and useful for investors because it allows investors to view performance in a manner similar to the method used by the Company's management. It helps improve investors' ability to understand the Company's operating performance and makes it easier to compare the Company's results with other companies that have different capital structures, stock option structures or tax rates. In addition, this measure is also among the primary measures used externally by the Company's investors, analysts and peers in its industry for purposes of valuation and comparing the operating performance of the Company to other companies in its industry.

Since OIBDAN is not a measure calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, net income as an indicator of operating performance and may not be comparable to similarly titled measures employed by other companies. OIBDAN is not necessarily a measure of the Company's ability to fund its cash needs. As it excludes certain financial information compared with operating income and net income (loss), the most directly comparable GAAP financial measures, users of this financial information should consider the types of events and transactions, which are excluded.

In addition, because a significant portion of the Company's advertising operations are conducted in foreign markets, principally France and the United Kingdom, management reviews the operating results from its foreign operations on a constant dollar basis. A constant dollar basis (i.e. a foreign currency adjustment is made to the 2008 actual foreign revenues and expenses at average 2007 foreign exchange rates) allows for comparison of operations independent of foreign exchange movements.

As required by the SEC, the Company provides reconciliations below of: (i) OIBDAN for each segment to consolidated operating income; (ii) Revenue excluding foreign exchange effects to revenue; (iii) Expense excluding foreign exchange effects to expense and (vi) OIBDAN to net income, the most directly comparable amounts reported under GAAP.