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Billboard Insider, Kirkland, WA (2025)

12/19/2024

The Fifth Circuit Court of Appeals decided on November 22, 2024 an interesting First Amendment case involving the advertising of marijuana. Here’s the facts: The State of Mississippi passed in 2022 the “Mississippi Medical Cannabis Act,” which authorized the sale and use of marijuana for certain medicinal purposes. The Act also contained substantial “restrictions on the advertising, signage, and display of medical cannabis.” Billboard advertising, for example, is prohibited.
Clarence Cocroft, the owner of Tru Source Medical Cannabis, LLC, sued the State of Mississippi, through its Commissioner of the Department of Revenue, Chris Graham. In Cocroft vs Graham, the Plaintiff argued its First Amendment rights were violated by prohibiting most forms of advertising of this product legalized by the Act, medical marijuana. The State, in turn, argued the Federal Controlled Substances Act (“CSA”) prohibits activities involving marijuana, including for medical use, nationwide.

The Fifth Circuit Court of Appeals decided on November 22, 2024 an interesting First Amendment case involving the advertising of marijuana. Here’s the facts: The State of Mississippi passed in 2022 the “Mississippi Medical Cannabis Act,” which authorized the sale and use of marijuana for certa...

12/17/2024

To sell more OOH faster we must know what buyers, in this case professional buyers, want from sales reps. I interviewed Ali Broback, Chief Client Officer, Partner at ODN, and Matt Borders, VP of Media, at ODN to uncover the things they want OOH sales reps to know.
Kevin
It varies a lot, but what should be a standard appropriate lead time from the time the rep gets an RFP to the time you get a very complete comprehensive proposal back?
Ali Broback
Always respond instantly with, I'm on it. I don't care if you're out for lunch, or you're on vacation. Set an expectation that you got the request and you're on it. If you think that you can't hit the deadline, let the buyer know right away. We're always flexible.
Matt B0rders
Today is 48 hours. I think five years ago, it was 4 days. It's shrunk significantly and continues to shrink.

To sell more OOH faster we must know what buyers, in this case professional buyers, want from sales reps. I interviewed Ali Broback, Chief Client Officer, Partner at ODN, and Matt Borders, VP of Media, at ODN to uncover the things they want OOH sales reps to know. Kevin It [...]

12/16/2024

Moorgate Capital Partners produces an outstanding quarterly report on the out of home advertising industry. Here are some charts in the third quarter 2024 report that caughtBillboard Insider’s eye.

Debt costs are moderating

Debt costs have been stable at the public out of home companies. Lamar has a 5% weighted average cost of debt, followed by OUTFRONT (5.5%) and Clear Channel Outdoor (7.4%). The cost of debt is a function of each company’s leverage. No surprise that Lamar has the lowest leverage with a debt/cashflow(EBIDTA) of 3.2, followed by OUTFRONT at 5.5 and Clear Channel Outdoor at 9.5

Place based difficulties due to weak cinema advertising

Billboard Insider has wondered why placed-based out of home has done so poorly since covid. Moorgate thinks that place based is down because of the poor performance of cinema advertising. Cinema advertising is still 45% below pre-covid levels. Other forms of place based are within 5-35% of precovid levels.

Moorgate Capital Partners produces an outstanding quarterly report on the out of home advertising industry. Here are some charts in the third quarter 2024 report that caughtBillboard Insider’s eye. Debt costs are moderating Debt costs have been stable at the public out of home companies. Lamar has...

12/11/2024

Clear Channel Outdoor CEO Scott Wells spoke at last week’s Wells Fargo TMT conference. Here’s a selection of his comments prepared by SignValue.
Outlook for 2025

So far so good...We are...very fortunate that we had a clear election...businesses are pretty positive about the economic outlook...it's not going to be a free for all in raising rates. I think we're going to have to fight for every increase...

Clear Channel Outdoor CEO Scott Wells spoke at last week’s Wells Fargo TMT conference. Here’s a selection of his comments prepared by SignValue. Outlook for 2025 So far so good...We are...very fortunate that we had a clear election...businesses are pretty positive about the economic outlook...it...

12/04/2024

While there were few major cases decided by the US or various state Supreme Courts directly effecting the billboard industry in 2024, the year was full of cases indirectly effecting the industry. For example, the Supreme Court issued a couple of cases that seem to further the judicial and perhaps societal trend to increase restraints on administrative agencies, sometimes derisively characterized as the “Deep State.”

First, in its decision on June 28, 2024 in Loper Bright Enterprises vs Raimondo, the Supreme Court effectively eliminated the deference afforded federal administrative agencies in their interpretation of ambiguous federal statutes. The case therefore overturned the so-called Chevron Doctrine, which had been in place and observed by courts since 1984. While the case involved federal instead of state agencies, Loper Bright might be used as a precedent to examine the rulings of State Departments of Transportation and their administrative rules.

Richard Rothfelder, Chris Rothfelder & Mike Falick While there were few major cases decided by the US or various state Supreme Courts directly effecting ...

12/03/2024

A Billboard Insider reader asks "Do you by chance know what OUTFRONT, Lamar and Clear Channel Outdoor's mix of local and national revenue is?"

Here's the data pulled from each company's 2023 10k or 3Q 2024 earnings presentation, analyzed and sponsored by SignValue.

- Lamar's more rural roadside billboard plant relies on national advertising for only 21% of revenue.
- Clear Channel Outdoor Americas plant in the US relies on national advertising for 35% of total revenues.
- OUTFRONT's urban billboard/transit plant relies on national advertising for 42% of total revenues.

SignValue's Take: National revenues grow fast during a strong economy but drop the fastest during a recession as company's cancel fancy brand positioning campaigns. Local advertising (think Coffee next exit or McDonalds exit 35) may not grow as fast during boom times but is more stable during recessions. If you have questions contact Paul Wright, CEO, SignValue, [email protected], 480-657-8400.

A Billboard Insider reader asks "Do you by chance know what OUTFRONT, Lamar and Clear Channel Outdoor's mix of local and national revenue is?" ...

11/25/2024

Hi Max, now that we are in the home stretch of 2024, how would you describe the M&A marketplace this year?
Looking back on the year so far, it felt similar to the period following the recession, such as 2013 & 2014. There was some activity in terms of smaller tuck-in deals, but the first 9 months of the year felt like the more typical acquirers were focused elsewhere on their businesses, and acquisitions became low priority. There were some headwinds, interest rates were at generational highs, and the market was still regrouping from the hot and heavy activity that took place in 2021 & 2022. When the deal market was really moving, it pulled many sellers forward, meaning those that were not serious about selling were getting a lot of calls, and in many cases the interest pushed them to market and they sold. The result left fewer sellers and less activity and the deal market slowed to a crawl over the summer.
&Aco &a

Max Drachman, Drachman M&A Co. Hi Max, now that we are in the home stretch of 2024, how would you describe the M&A marketplace this year? Looking ba ...

11/19/2024

CLEARWATER MINNESOTA: Franklin Outdoor Advertising, a third generation, family-owned billboard company based in Clearwater, Minnesota has announced today they have acquired the billboard assets of Houck Outdoor, based in Shoreview, Minnesota. The purchase includes 38 static (traditional) bulletins along the I-94 corridor from Clearwater, Minnesota to Rogers Minnesota area and along the I-90 corridor near the Fairmont, Minnesota area.

Franklin Outdoor Advertising now has 943 faces throughout Minnesota and Western Wisconsin in 28 counties. It makes Franklin the largest Minnesota-based billboard company.

Dan Franklin, of Franklin Outdoor Advertising said “We are honored to work with Houck on this purchase. This is a perfect fit for our growth strategy and will be a great complement to our Minnesota plant.

Dan Franklin, Franklin Outdoor CLEARWATER MINNESOTA: Franklin Outdoor Advertising, a third generation, family-owned billboard company based in Clearwater, M ...

11/18/2024

Following up on the recent articles in Billboard Insider, I thought it would be beneficial to talk about the representations and warranties that lenders require. Typically, if you borrow, these reps and warranties are non-negotiable. They start the first day you borrow and extend “at all times any indebtedness exists.” (Quotation marks indicate text from an actual bank loan agreement.)
What exactly is included will depend on the lender, but these are some of the common reps and warranties a borrower must agree to:
Organization – you must attest to the type and legality of the entity; the legitimacy and legality of your business in all places where you do business; and that you will continue to follow all laws, regulations, and rules that pertain to your entity and business.

Ken Altena, Partner, Billboard Loans Following up on the recent articles in Billboard Insider, I thought it would be beneficial to talk about the representa ...

11/15/2024

Thanks to all of our readers who provided their thoughts on our stories on the MTA awarding their contract to Clear Channel and the OUTFRONT thoughts on that contract. Here are some of the comments we received.
"You guys had it right. The 15 year contract was super expensive, big check, tight margin. Rumors are that the mag (minimum amount guaranteed) on this deal was around where actuals have been - yikes. Sure MTA dangled a carrot by telling operators they can develop new signs, but NYC is extremely hard to develop, and with a fifteen year window you would really need to get your steel built in the next five to make big bucks, right?"
"Imagine how hard it must have been for Outfront to perform well on both transit and bulletins. In that market they must have been competing with themselves. Then, with Covid there must have been a pause around billboard that probably put a larger damper on the last few years of the franchise."
"CCO must be in heaven.

Thanks to all of our readers who provided their thoughts on our stories on the MTA awarding their contract to Clear Channel and the OUTFRONT thoughts on tha ...

11/14/2024

Here's what OUTFRONT CEO Jeremy Male said on this week's earnings call about the MTA billboard contract which Clear Channel is taking over from OUTFRONT, sponsored and analyzed by SignValue.

I wanted to speak a little bit more about the Billboard contract in New York that we exited as it's illustrative of our broader strategy with regards to how we approach contracts and partnerships with any counterparty municipal or private or any property. My first thought was in transit this particular, this contract exit reflects our focus on improving margins and the economic returns associated with these partnerships when bidding on new or legacy contracts particularly those with revenue shares and minimum annual guarantees. We strive to submit a proposal that reflects the value brought to the partnership by OUTFRONT requiring an attractive return to the company and its shareholders

Translation: The terms were not to our liking and the margin wasn't good enough.

Outfront CEO Jeremy Male Here's what OUTFRONT CEO Jeremy Male said on this week's earnings call about the MTA billboard contract which Clear Chann ...

11/12/2024

On last Friday's earnings call Lamar Advertising CEO Sean Reilly broke out the economics of a digital billboard conversion. Here's a review of Reilly's comments, sponsored and analyzed by SignValue.

When we take down a static unit on average it's doing about $3000 a month...replace that with digital unit that... costs...a little over $200,000...your revenue lift is give or take 5 or 6 times so you're you're going to do something in the neighborhood of of $15,000 a month on that board...It's been very gratifying for us to see that that those economics have held up...over the decades...From the advertiser's point of view...they're paying about $3,000 for the space for a static unit but they then have to...buy the vinyl and amortize that cost over the the length of their contract....When they move over to a a digital unit they're paying about the same absolute dollars. They're paying about $3000 for the slot...

On last Friday's earnings call Lamar Advertising CEO Sean Reilly broke out the economics of a digital billboard conversion. Here's a review of Re ...

11/11/2024

"Trends continue to be encouraging as we near year end," was how Lamar CEO Sean Reilly lead off the company's 3Q 2024 earnings call. Here are the results of the Lamar Advertising 3Q 2024 earnings release and conference call, analyzed and sponsored by SignValue.

- Revenues increased by 4% to $564 million. Local revenue as up 4.9%. National revenue was down 2.9%. Programmatic revenue increased 70%.
- Operating expense increased by 5% due to increased medical costs, contract labor and no covid relief grants. Lamar CEO Sean Reilly said "we see expense trends correcting in Q4."
- Adjusted EBIDTA increased 2.1% to $266. million.
- Capexp totaled $30 million for the third quarter of 2024. The company added 50 new digital billboards. In addition, Lamar closed 17 acquisitions accounting for 90 new faces for a total acquisition price of $31 million.
- Total debt was $3.2 billion at September 30, 2024. The company's debt/EBIDTA is a low 2.91.

"Trends continue to be encouraging as we near year end," was how Lamar CEO Sean Reilly lead off the company's 3Q 2024 earnings call. Here ar ...

11/07/2024

When you sell out of home assets, you make reps and warranties to the buyer. There are two approaches.

Full reps and warranties

This is the best way to get top price for your out of home assets. Sellers will pay more if you agree to this long list of representations. You represent and warranty that you:

- Have valid title to assets.
- Are authorized to sell the assets.
- Have valid title to the assets you are selling
- Are in compliance with all laws.
- Have valid permits (usually listed)
- Own your billboards and that they are in good repair
- Have valid title to any license or intangibles you use in your business.
- Have valid ad contracts (usually listed).
- Have disclosed any liabilities which you are expecting the buyer to assume.
- Have files your taxes timely.
- Have no environmental liabilities
- Have disclosed all information which might have a material adverse impact on the assets you are selling.

When you sell out of home assets, you make reps and warranties to the buyer. There are two approaches. Full reps and warranties This is the best way to get ...

11/05/2024

OAAA CEO Anna Bager was interviewed last week by Ian Dallimore on Lamar's October 30 Digital and Dirt podcast. She highlighted the importance of the OAAA's Benchmarketing study.

On the OAAA's recent benchmarking study

Without making any changes to your investment but making some changes to how you're investing your dollar you can ...increase the effectiveness of your campaign 60% and that is by...adding reallocating more dollars to out of home...a little under 10% to close to 30% you can you know just make the campaign so much more efficient... you're taking dollars not working very well for you putting them in out of home and we're just seeing really great results so first part of the study came out last year...and now we're going specifically into three different categories automotive retail grocery and CPG and all of them are showing incredible results when you add out of home to the mix.. mean that's a pretty good door opener.

OAAA CEO Anna Bager OAAA CEO Anna Bager was interviewed last week by Ian Dallimore on Lamar's October 30 Digital and Dirt podcast. She highlighted the ...

11/04/2024

Charlotte, NC – November 1, 2024 – Adams Outdoor Advertising ("Adams") is thrilled to announce the acquisition of all 28 billboard assets in the Charlotte market from Kegerreis Outdoor Advertising LLC ("Kegerreis"), effective October 31, 2024. The terms of the transaction remain undisclosed.
This strategic acquisition enhances Adams’ out-of-home advertising coverage in one of the fastest- growing markets in the United States. The new assets include a mix of static bulletins and high-visibility digital units, predominantly located along major interstates and commuter routes along the northern and western corridors of Charlotte. Drachman M&A Co. represented Adams in the transaction.

Julie Johnson, General Manager of Adams’ Charlotte market, emphasized the significance of the acquisition: "These are must-have assets in high-traffic areas, offering unparalleled visibility to advertisers in Charlotte.
&Aco

Charlotte, NC – November 1, 2024 – Adams Outdoor Advertising ("Adams") is thrilled to announce the acquisition of all 28 billboard assets in the C ...

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