Clear Channel Outdoor Holdings Inc
For the period ended Dec 31, 2024. Filed Feb 24, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Feb 24, 2025
CCO$2.42-0.4%Stored close · as of Oct 14, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-26.
0001334978-24-000006
Item 1A. Risk FactorsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-24.
0001334978-25-000008
Item 1A. Risk FactorsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 169 previous paragraphs and 164 current paragraphs.
85 unchanged; 67 reworded; 10 added; 15 removed; 2 previous and 2 current paragraphs rearranged.
Tables are not compared: 0 previous and 0 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (10)
Current report
Periods of economic slowdown or recession, or periods of economic uncertainty, are generally accompanied by reduced advertising spend, which has negatively impacted our business in the past. The current macroeconomic environment is characterized by high inflation, which has increased our costs, and elevated interest rates, which have raised our cost of debt. Continued fluctuations in inflation and interest rates are uncertain and could continue to adversely impact our reported results.
Current report
In addition, because a significant portion of our revenue is derived from local advertisers, our ability to generate revenue in specific markets is directly affected by local and regional economic conditions. In 2023, our revenue was impacted in certain of our larger U.S. markets as a result of the Hollywood labor union strikes and other specific macroeconomic trends. In addition, even though we have recently experienced growth in our Airports segment, the performance of this segment is vulnerable to fluctuations in the demand for air travel, which may be influenced by world trade policies, government-to-government relations, economic uncertainty, and passengers’ discretionary income, among other factors. A decline in economic conditions could negatively affect our performance and require us to implement cost-saving or other measures.
Current report
In addition, we are exploring the use of artificial intelligence (“AI”), which we define as machine-based systems that can make predictions or recommendations, to enhance operational efficiency and support decision-making across key areas of our business. Our current exploratory use of AI includes the testing of ChatGPT and Copilot. As the use of AI is a novel business model without an established track record, data sourcing, technology, integration and process issues, program bias into decision-making algorithms, concerns over intellectual property, the evolving regulatory landscape, security problems, and the protection of privacy could impair the adoption and acceptance of AI solutions and expose us to new risks. Furthermore, if any sensitive information were to be input into a third-party generative AI platform, it could be leaked or disclosed to others, including if sensitive information is used to train the third party’s model.
Current report
On January 8, 2025, we entered into a share purchase agreement to sell the businesses constituting our Europe-North segment. Completion of the transaction is subject to receipt of regulatory clearance or approval of the transaction by certain antitrust authorities. We can give no assurances that the necessary regulatory clearances will be obtained on the expected timeline, or at all, or that closing of the transaction will occur. Any delays in the expected timeframe, speculation and uncertainty regarding the sale, or the termination of the agreement could create uncertainties or disruptions in our business, which could have an adverse effect on our results of operations, financial condition and stock price. Even if the sale is completed successfully, we may be subject to additional risks, including: disruption of our business in our America and Airports segments as well as in our remaining international operations; significant transaction costs; distraction of our employees; difficulty in recruiting, hiring, motivating and retaining personnel; difficulty in maintaining or negotiating and consummating new business or strategic relationships or transactions; restrictions on the conduct of our businesses in the Europe-North segment; litigation relating to the sale against us, our directors and officers; inability to strengthen our liquidity, and realize some or all of the benefits from the transaction; and decline in the trading price of our common stock. Further, if the sale is not consummated, investor confidence could decline; litigation could be brought against us, our directors and officers; relationships with existing and prospective customers, vendors, investors, lenders and other business partners may be adversely impacted; and the trading price of our common stock could decline. We will use the anticipated net proceeds from the sale, after payment of transaction-related fees and expenses, to repay in full the CCIBV Term Loan Facility, and we expect to use any remaining net proceeds primarily to repay additional debt and/or for other purposes permitted under the agreements governing the remainder of our indebtedness. Stockholders will not have input on our use of the remaining proceeds and may not agree with our use thereof, and our use thereof may not yield any return on our stockholders’ investments.
Current report
Likewise, our acquisitions involve risks, such as:
Current report
Furthermore, we have been, and may be, subject to various other legal proceedings, regulatory actions, claims, inquiries and investigations from time to time relating to our business. Legal claims have been asserted against us, and could be asserted, by individuals, either individually or through class actions, by governmental entities in civil or criminal investigations and proceedings, or by other entities. A large portion of our litigation arises in the following contexts: commercial disputes, personal injury claims, employment and benefits-related claims, land use and zoning disputes, governmental fines, intellectual property claims and tax disputes. An adverse outcome of a legal proceeding, regulatory action or government investigation may damage our reputation, force us to adjust our business practices, and/or has required us, and may require us in the future, to pay significant damages, fines or settlement amounts.
Current report
•Natural disasters and severe weather including fires, such as the Southern California wildfires in January 2025, earthquakes, floods and extreme weather temperatures, which could lead to a decrease in advertising in specific regions or more broadly; and
Current report
•continued economic uncertainty, an economic slowdown or a recession, including as a result of increased tariffs and retaliatory trade regulations and policies;
Current report
•the impact of the agreement to sell the businesses in our Europe-North segment and the potential sales of our businesses in Spain and Brazil;
Removed paragraphs (15)
Previous report
Periods of a slowing economy or recession, or periods of economic uncertainty, have historically been accompanied by a decrease in advertising and have negatively impacted our business. The current macroeconomic environment remains characterized by above-average inflation, high interest rates, foreign currency exchange volatility, volatility in global capital markets and continued risk of recession. In 2022 and 2023, high interest rates resulted in an increase in our weighted average cost of debt, with our interest expense, net, increasing by $60.8 million in 2023 compared to 2022 to a total of $421.4 million, and inflation affected our results, particularly in our Europe businesses due to higher costs primarily for labor and rent. While inflation, interest rates and foreign currency exchange rates have been lower or less volatile in 2023, future fluctuations in these indicators are uncertain and could result in further adverse impacts to our reported results. If economic conditions worsen, there can be no guarantee that we will be able to mitigate the effects of these conditions on our business. During the height of the COVID-19 pandemic, we were required to take various measures to increase our liquidity and preserve and strengthen our financial flexibility, including implementing restructuring plans to reduce headcount and related costs throughout our business. If economic conditions worsen or if a recession occurs, we may be required to take similar or more strict measures than those we took during the height of the COVID-19 pandemic. Those measures, including restructurings and cost savings, could adversely affect our business, operations, liquidity and financial results.
Previous report
In addition, we use artificial intelligence (“AI”) in connection with the use of certain Software-as-a-Service tools, such as call analytics and creative generation, in addition to AI features of software we build through Application Programming Interface. Accordingly, we expect to be subject to laws and regulations with respect to the use of such technologies. Such regulations may restrict our ability to use AI or may require increased expenditures. In the U.S., in 2023, an Executive Order was published by the Biden Administration establishing new standards for AI safety and security and measures to protect individuals’ privacy. Additionally, the E.U. AI Act, which is targeted at individuals within the E.U., implements safeguards for the use of AI technology and imposes fines of up to 7% of global turnover for failure to comply. Furthermore, if the content, analyses or recommendations that AI applications assist in producing for our business and for our customers are, or are alleged to be, deficient, inaccurate or biased, our business, financial condition and results of operations may be adversely affected.
Previous report
We have initiated processes to sell the businesses in our Europe-North segment and in Latin America. These processes have required, and may continue to require, significant resources and expenses. In addition, speculation and uncertainty regarding these processes may cause or result in disruption of our business; distraction of our employees; difficulty in recruiting, hiring, motivating and retaining talented and skilled personnel, especially in Europe and in Latin America; difficulty in maintaining or negotiating and consummating new business or strategic relationships or transactions, especially in Europe and in Latin America; and increased stock price volatility. If we are unable to mitigate these or other potential risks related to the uncertainty caused by these processes, our business, our net sales, operating results and financial condition could be adversely impacted.
Previous report
As our Board of Directors continues its ongoing review and the evaluation of these processes, it may determine that our most effective strategy is to continue to operate all of our remaining European and Latin American businesses. The Company has not set a timetable for completion of these reviews, may suspend the processes at any time and does not intend to make further announcements regarding the processes unless and until the Board of Directors approves a course of action for which further disclosure is appropriate.
Previous report
Doing business in foreign countries exposes us to certain risks not expected to occur when doing business in the U.S.
Previous report
Our international operations involve contracts with, and regulation by, foreign governments. We operate in many parts of the world that experience corruption to some degree. Although we have policies and procedures in place that are designed to promote legal and regulatory compliance (including with respect to the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act), our employees, subcontractors and agents could take actions that violate applicable anti-corruption and fraud laws or regulations. Prior to the Company’s separation from iHeartCommunications, Inc. in 2019, two former employees of Clear Media, a former indirect, non-wholly-owned subsidiary of the Company that was sold in April 2020, were convicted in China of certain crimes, including the crime of misappropriation of Clear Media funds, and sentenced to imprisonment. The Company advised both the SEC and the DOJ of the investigation of Clear Media, and in 2023, without admitting or denying the underlying allegations, which involved the U.S. Foreign Corrupt Practices Act, agreed to pay a total of approximately $26.1 million in disgorgement, civil penalties and prejudgment interest to the SEC. For additional information on this matter, please refer to Note 8 to our Consolidated Financial Statements located in Item 8 of this Annual Report on Form 10-K. Violations of these laws, or allegations of such violations, have had and could have a material adverse effect on our business, financial position and reputation.
Previous report
We are exposed to foreign currency exchange risks because a portion of our revenue and cash flows are received in foreign currencies and translated to U.S. dollars for reporting purposes.
Previous report
We generate a portion of our revenue in currencies other than U.S. dollars. Additionally, a portion of our cash flows are generated in foreign currencies and translated to U.S. dollars for reporting purposes, and certain of the indebtedness held by our international subsidiaries is denominated in U.S. dollars. Therefore, exchange rate fluctuations in any currency from a country in which we operate could have an adverse effect on our profitability, and significant changes in the value of such foreign currencies relative to the U.S. dollar could have a material adverse effect on our financial condition and our ability to meet interest and principal payments on our indebtedness. In 2022, as a result of heightened inflation and monetary policy, the U.S. dollar strengthened against the Euro and British pound sterling, among other European currencies, resulting in an adverse impact on our reported results in our Europe-North and Europe-South segments in such year. The U.S. dollar has since trended weaker; however, there can be no guarantee that such trend will continue as the U.S. Federal Reserve could further raise the federal funds rate, which could result in downstream impacts to global exchange rates and adverse impacts to our reported results in our Europe-North segment. Given the volatility of exchange rates, there can be no assurance that we will be able to effectively manage our currency transaction and/or translation risks. We expect to experience economic losses and gains and negative and positive impacts on our operating income as a result of foreign currency exchange rate fluctuations.
Previous report
We currently do not pay regularly-scheduled dividends on our common stock.
Previous report
We do not pay regularly-scheduled dividends on our common stock, and should we seek to do so in the future, we are subject to restrictions on our ability to pay dividends by the instruments governing our outstanding debt. Because we do not pay dividends on our common stock, the price of our common stock must appreciate in order for common stockholders to realize a gain on their investments. This appreciation may not occur.
Previous report
•the impact of the processes to sell the businesses in our Europe-North segment and in Latin America;
Previous report
•fluctuations in exchange rates and currency values;
Previous report
•the effect of analyst or credit ratings downgrades;
Reworded paragraphs (67)
Previous wording
Our results have in the past been, and could in the future be, adversely affected by continued economic uncertainty, an economic slowdown or a recession.
Current wording
Our results have been, and could continue to be, adversely affected by continued economic uncertainty, an economic slowdown or a recession.
Previous wording
Furthermore, because a significant portion of our revenue is derived from local advertisers, our ability to generate revenues in specific markets is directly affected by local and regional conditions. During 2023, we experienced weakness in revenue within certain of our larger U.S. markets, most notably the San Francisco/Bay Area market as specific macroeconomic trends affecting such market have resulted in lower spend on out-of-home advertising. Additionally, Hollywood labor union strikes negatively impacted out-of-home advertising sales in the Media/Entertainment industry across our U.S. markets. During 2023, we also experienced economic variability throughout Europe, impacting country level growth rates in our European businesses. For example, economic downturns in Sweden and Norway negatively impacted demand for out-of-home advertising in these countries. Unfavorable regional or local economic or political conditions, such as those resulting from the events described above and from the Russia-Ukraine war or the Israel-Hamas war, as well as increased social and political turmoil and unrest in some Latin American countries, also may adversely impact our results. A severe or prolonged economic downturn, including a recession or depression, could impact our business, including our revenues and our ability to raise additional capital when needed on favorable terms or at all. We cannot anticipate the impact of the current economic environment on our business, and any of the foregoing could materially harm our business.
Current wording
Unfavorable global, regional or local economic or political conditions, such as those resulting from the events described above and from actual and potential shifts in the U.S. and foreign trade, economic and other policies; trade tensions between the U.S. and other countries, including imposition of increased, new and retaliatory tariffs; the Russia-Ukraine war and the conflicts in the Middle East; as well as events such as terrorist attacks or increased social and political turmoil and unrest also may adversely impact our results. We cannot anticipate the impact of the current economic environment on our business, and any of the foregoing could materially harm our business.
Previous wording
We require a significant amount of cash to service our debt obligations and to fund our operations and capital expenditures, which depends on many factors beyond our control, including the recent volatility and uncertainty in capital markets.
Current wording
We require a significant amount of cash to service our debt obligations and to fund our operations and capital expenditures, and our ability to generate cash depends on many factors beyond our control, including the recent volatility and uncertainty in the capital markets.
Previous wording
Our ability to service our debt obligations requires a significant amount of cash. During 2023, we spent $404.4 million of cash to pay interest on our debt, and we anticipate having approximately $448 million of cash interest payment obligations in 2024, assuming that we do not refinance our debt or incur additional debt. Our significant principal and interest payment obligations reduce our financial flexibility, make us more vulnerable to changes in operating performance and economic downturns or recessions, could reduce our liquidity over time and could negatively affect our ability to obtain additional financing in the future.
Current wording
Our ability to service our debt obligations requires a significant amount of cash. During 2024, we spent $434.5 million of cash to pay interest on our debt, and we anticipate having approximately $394 million of cash interest payment obligations in 2025, assuming the repayment of the term loan facility of Clear Channel International B.V. (the “CCIBV Term Loan Facility”) with proceeds from the sale of the businesses in our Europe-North segment, that we do not use the remaining proceeds from such sale to repay additional debt, and that we do not refinance or incur additional debt. Our significant principal and interest payment obligations reduce our financial flexibility, make us more vulnerable to changes in operating performance and economic downturns or recessions, could reduce our liquidity over time, and could negatively affect our ability to obtain additional financing in the future.
Previous wording
Our other cash requirements are for working capital used to fund the operations of the business, including site lease costs (payments for land or space used by our advertising displays); capital expenditures (primarily related to construction and sustaining activities for our out-of-home advertising displays); and debt service. We primarily finance these requirements with cash on hand, internally-generated cash flow from operations and, if necessary, borrowings under our credit facilities. Our long-term future cash requirements will depend on many factors, including the growth of our business; investments in digital conversions and new technologies, such as RADAR and our programmatic solution set; and the pursuit and outcome of strategic transactions, including the outcome of the ongoing processes to sell the businesses in our Europe-North segment and in Latin America. Our ability to meet these cash requirements through cash from operations depends on our future operating results and financial performance, which are subject to significant uncertainty and may be affected by events beyond our control, including macro-economic events that may result in weakness globally or in certain specific markets, high interest rates, currency fluctuations and geopolitical events, such as the Russia-Ukraine war and the Israel-Hamas war. Availability of our credit facilities for working capital and other needs is limited by certain covenants under our existing indebtedness, and if we are unable to generate sufficient cash through our operations, we could face substantial liquidity problems, which could have a material adverse effect on our financial condition, our ability to meet our obligations and the value of the Company.
Current wording
Our other cash requirements are for working capital used to fund the operations of the business and capital expenditures. We typically meet these needs through cash on hand, internally-generated cash flow from operations and, if necessary, borrowings under our credit facilities. Our long-term future cash requirements will depend on many factors, including the growth of our business, our investments in digital conversions and new technologies, and the pursuit and outcome of strategic opportunities, including the completion of the sale of our Europe-North segment and the ongoing sales processes for our businesses in Spain and Brazil. Our ability to meet our cash requirements through cash from operations depends on our future operating results and financial performance. Availability of our credit facilities for working capital and other needs is limited by certain covenants under our existing indebtedness, and if we are unable to generate sufficient cash through our operations, we could face substantial liquidity problems.
Previous wording
The purchase price of possible asset acquisitions, capital expenditures for deployment of digital billboards and other strategic initiatives could require additional indebtedness or equity financing from banks or other lenders, or through public offerings or private placements of debt or equity, strategic relationships or other arrangements, or from a combination of these sources. Additional indebtedness could increase our leverage and make us more vulnerable to economic downturns and may limit our ability to withstand competitive pressures. The terms of our existing or future debt or equity agreements may restrict us from securing financing on terms that are acceptable to us. Furthermore, there can be no assurance that financing alternatives will be available to us in sufficient amounts or on terms acceptable to us in the future due to market conditions, our financial condition, our liquidity constraints or other factors, many of which are beyond our control. The inability to obtain additional financing in such circumstances could have a material adverse effect on our financial condition and on our ability to meet our obligations or pursue strategic initiatives.
Current wording
The purchase price of possible asset acquisitions, capital expenditures for deployment of digital billboards and other strategic initiatives could require additional financing from banks or other lenders, offerings of public or private debt, equity or equity-linked securities, strategic partnerships, or a combination thereof. Additional indebtedness could increase our leverage and make us more vulnerable to adverse changes in economic or industry conditions and may limit our ability to withstand competitive pressures. The terms of our existing or future debt or equity agreements may restrict us from securing financing on terms that are acceptable to us. Furthermore, there is no assurance that we will be able to secure financing alternatives, complete liquidity-generating transactions or refinance debt in sufficient amounts or on terms acceptable to us in the future, due to market conditions, our financial condition, our liquidity constraints, or other factors that may be beyond our control. Even if financing alternatives are available, we may not find them suitable or offered at reasonable interest rates. The inability to obtain additional financing in such circumstances could have a material adverse effect on our financial condition and on our ability to meet our obligations or pursue strategic initiatives.
Previous wording
As of December 31, 2023, we had approximately $5.6 billion of total indebtedness outstanding, including $1.26 billion of term loans under the Term Loan Facility payable in August 2026; $1.25 billion aggregate principal amount of 5.125% Senior Secured Notes due 2027 (the “CCOH 5.125% Senior Secured Notes”); $750.0 million aggregate principal amount of 9.000% Senior Secured Notes due 2028 (the “CCOH 9.000% Senior Secured Notes”); approximately $1.0 billion aggregate principal amount of 7.750% Senior Notes due 2028 (the “CCOH 7.750% Senior Notes”); $1.04 billion aggregate principal amount of 7.500% Senior Notes due 2029 (the “CCOH 7.500% Senior Notes”); $375.0 million aggregate principal amount of CCIBV 6.625% Senior Secured Notes due 2025 (the “CCIBV Senior Secured Notes”); and approximately $4.2 million of finance leases. Therefore, our next material debt maturities are in 2025 and 2026 when the CCIBV Senior Secured Notes and the Term Loan Facility become due, respectively. Our substantial level of indebtedness and other financial obligations increase the possibility that we may be unable to generate cash sufficient to pay, when due, the principal, interest or other amounts due in respect of our indebtedness. From time to time, we have explored, and expect to continue to explore, a variety of transactions to improve our liquidity and/or to refinance our indebtedness, including issuing new debt to pay off more expensive debt, repurchasing outstanding notes in the open market with available liquidity and deploying the proceeds from the dispositions of the businesses in our Europe-South segment. We cannot assure you that we will enter into or consummate successfully any liquidity-generating or debt-refinancing transactions, and we cannot currently predict the impact that any such transactions, if consummated, would have on us.
Current wording
As of December 31, 2024, we had approximately $5.7 billion of total indebtedness outstanding. Our next material debt maturity is in 2027 when the $1.25 billion aggregate principal amount of 5.125% Senior Secured Notes becomes due, assuming that we are able to complete the sale of the businesses in our Europe-North segment and repay the $375 million under the CCIBV Term Loan Facility, which would otherwise be due in 2027. Our substantial level of indebtedness and other financial obligations increase the possibility that we may be unable to generate cash sufficient to meet principal, interest or other payment obligations in respect of our indebtedness when due. We have explored, and expect to continue to explore from time to time, a variety of transactions to improve our liquidity and/or to refinance our indebtedness, including issuing new debt to pay off more expensive debt, repurchasing outstanding notes in the open market with available liquidity, and deploying the proceeds from the dispositions of businesses, if completed. We cannot assure you that we will enter into or consummate successfully any liquidity-generating or debt-refinancing transactions, and we cannot currently predict the impact that any such transactions, if consummated, would have on us.
Previous wording
•Requiring us to dedicate a substantial portion of our cash flow to the payment of principal and interest on our indebtedness, thereby reducing cash available for other purposes, including to fund operations and capital expenditures, invest in new technology such as RADAR and our programmatic solution set, and pursue other business and strategic opportunities;
Current wording
•Requiring us to dedicate a substantial portion of our cash flow to the payment of principal and interest on our indebtedness, thereby reducing cash available for other purposes, including to fund operations and capital expenditures, invest in digital conversions and new technology, and pursue other business and strategic opportunities;
Previous wording
•Limiting our liquidity and operational flexibility and limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes;
Current wording
•Limiting our liquidity, operational flexibility and ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes;
Previous wording
•Making us more vulnerable to increases in interest rates, a downturn in our operating performance, a decline in general economic or industry conditions, or a disruption in the credit markets; and
Current wording
•Making us vulnerable to fluctuations in interest rates, a downturn in our operating performance, a decline in general economic or industry conditions, or volatility in the credit markets; and
Previous wording
•We may not be able to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness, and if our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell assets or operations, seek additional capital or refinance our indebtedness. Additionally, we may not be able to take any of these actions, or these actions may not be successful or permit us to meet our scheduled debt service obligations. Furthermore, these actions may not be permitted under the terms of our existing or future debt agreements.
Current wording
•We may not be able to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal and interest on our indebtedness, and if our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell additional assets or operations, seek additional capital or refinance our indebtedness. Additionally, we may not be able to take any of these actions, or these actions may not be successful or permit us to meet our scheduled debt service obligations. Furthermore, these actions may not be permitted under the terms of our existing or future debt agreements.
Previous wording
Implementing our strategy may be more difficult, costly and/or time consuming than expected, and we may not realize the anticipated benefits thereof fully or at all.
Current wording
Implementing our strategy is difficult, costly and time consuming, and we may not realize the anticipated benefits thereof fully or at all.
Previous wording
We are focused on driving incremental demand for out-of-home advertising and on increasing our operational efficiencies. Our strategy is based on three pillars — accelerating our digital transformation, prioritizing customer-centricity and driving executional excellence — which are being implemented together with the optimization of our portfolio. The success of our strategy and the realization of the anticipated benefits thereof, depends, in part, on our ability to execute and demonstrate the value-added capabilities of our digital display platform to our customers; to grow our digital footprint; to enhance our technology offerings; to adopt digital infrastructure to automate processes; to add sales channels to serve our clients; and to increase the speed, quality and repeatability of our key business processes.
Current wording
We are focused on driving incremental demand for sustainable long-term revenue growth while increasing operational efficiencies to enhance profitability, improve operating cash flows and reduce leverage. Our strategy centers on three key pillars: accelerating our digital transformation, prioritizing customer-centricity and driving executional excellence. The success of our strategy and the realization of the anticipated benefits thereof, depends, in part, on our ability to modernize our solutions and enhance out-of-home’s value to attract more advertisers and capture market share from other media, to grow our digital footprint, to enhance our technology offerings, to continue to invest in digital infrastructure to automate key processes, to add sales channels and tailor our approach to serve our clients, and to increase the speed, quality and repeatability of our key business processes.
Previous wording
Demonstrating the capabilities of our digital display platform and growing our digital footprint depend, in part, on our ability to deliver and install digital displays in a timely manner, including delivery and installation within complex transit infrastructures, including airports. If we fail to satisfy our contractual obligations to our customers and if any such failures cannot be resolved, and/or if the digital display platform and/or the digital advertising displays that we provide to our customers do not meet their expectations or are found to be defective, or if we are unable to realize the anticipated benefits of these products due to reduced market demand for these products or digital advertising generally, including as a result of macroeconomic conditions, our business operations and financial results will suffer.
Current wording
Strengthening our platform’s value and growing our digital footprint depend, in part, on our ability to deliver and install digital displays in a timely and cost-effective manner, which may be impacted by various factors, including high costs or unavailability of the elements necessary for the production of displays (as a result of increased tariffs, other foreign or trade policies or otherwise), the complexity of the delivery and installation within transit infrastructures, including airports, and increased costs of the energy necessary to power digital displays. If we fail to satisfy our contractual obligations to our customers and if any such failures cannot be resolved, and/or if the digital display platform and/or the digital advertising displays that we provide to our customers are too costly, do not meet their expectations or are found to be defective, or if we are unable to realize the anticipated benefits of these products due to reduced market demand for these products or digital advertising generally, our business operations and financial results will suffer.
Previous wording
We continue to develop and improve our technological offerings, including RADAR, our proprietary and industry-first suite of data-driven solutions for planning, measuring and amplifying the impact of out-of-home advertising, as well as our programmatic solution set, which uses automated technology, data and algorithms to offer a streamlined, flexible buying process, audience targeting and ad measurement capabilities through real-time, biddable digital marketplaces. Such offerings require the successful creation, enhancement, use and adoption of innovative technology that includes hardware, software, connectivity, automation and digital solutions. As a result, we make significant investments in research and development, connectivity solutions, data security and employee training. These investments may not result in improvements to RADAR, our programmatic solutions or other technology we may create or adopt in the future and may not provide the desired results for our clients. If we are not able to deliver our solutions with differentiated features and functionality, our clients may not value or adopt these solutions, which could have a material adverse effect on our reputation, business, results of operations and/or financial condition. In addition, the market for programmatic ad buying remains an emerging market, and our current and potential clients may not shift quickly enough to programmatic buying from other buying methods, reducing our growth potential. If the market for programmatic ad buying develops more slowly than we expect, it could reduce demand for our programmatic solution set, which could delay the realization of certain of the benefits of our strategy.
Current wording
We continue to develop and work on improving our technological offerings, including RADAR, as well as our programmatic solution. Such offerings require the successful creation, enhancement, use and adoption of innovative technology that includes hardware, software, connectivity, automation and digital solutions. As a result, we make significant investments in research and development, connectivity solutions, data security and employee training. These investments may not result in improvements to RADAR, our programmatic capabilities or other technology we may create or adopt in the future and may not provide the desired results for our clients. If we are not able to deliver our solutions with differentiated features and functionality, our clients may not value or adopt these solutions. In addition, the market for programmatic out-of-home advertisement buying is still emerging and if the markets fail to develop or develop more slowly than we expect, our investment in programmatic solutions may not result in business from new customers. Our investment in programmatic solutions may also result in current customers shifting from our more profitable offerings into programmatic, which could also impact our financial results.
Previous wording
Furthermore, implementing our digital transformation, and complying with local laws and regulations in doing so, requires significant costs and time, and we may not be able to recover the costs from our customers or otherwise. Any costs currently anticipated may significantly increase if we incur cost overruns due to technical difficulties or if we experience increased costs of data, digital displays, materials and labor; suspensions or delays in installation and/or construction caused by us, our subcontractors, or due to external events beyond our control or otherwise; increased insurance, bonding and litigation expenses; the inability to recruit and maintain qualified personnel; or the inability, or increased costs, to comply with evolving government regulations and directives relating to use of digital services and data, including internet, mobile, privacy, marketing and advertising aspects of our business, all of which could have an adverse effect on our business, financial condition and results of operations.
Current wording
Furthermore, implementing our digital transformation, and complying with local laws and regulations in doing so, requires significant costs and time, and we may not be able to recover the costs from our customers or otherwise. Any costs currently anticipated may significantly increase if we incur cost overruns due to technical difficulties or if we experience increased costs of energy, data, digital displays, materials and labor; suspensions or delays in installation and/or construction caused by us, our subcontractors, or due to external events beyond our control or otherwise; increased insurance, bonding and litigation expenses; the inability to recruit and maintain qualified personnel; or the inability, or increased costs, to comply with evolving government regulations and directives relating to use of digital services and data, including internet, mobile, privacy, marketing and advertising aspects of our business, all of which could have an adverse effect on our business, financial condition and results of operations.
Previous wording
The success of our business is dependent upon our ability to obtain and renew contracts with municipalities, transit authorities and private landlords, which we may not be able to obtain on favorable terms.
Current wording
The success of our business is dependent upon our ability to obtain and renew contracts with municipalities, transit authorities and private landlords, which we may fail to obtain on favorable terms.
Previous wording
Our airport, transit and street furniture products require us to develop and maintain robust relationships with elected officials and regulatory authorities in a vast number of municipalities. Many of these contracts, which require us to participate in competitive bidding processes at each renewal, typically have terms ranging up to 15 years and have revenue-share requirements, capital expenditure requirements and/or fixed payment components. Competitive bidding processes are complex and sometimes lengthy, and substantial costs may be incurred in connection with preparing bids. Our competitors, individually or through relationships with third parties, may be able to provide municipalities with different or greater capabilities, prices or benefits than we can provide. In the past we have not been, and most likely in the future we will not be, awarded all of the contracts on which we bid. The success of our business also depends on our ability to obtain and renew contracts with private landlords. There can be no assurance that we will win any particular bid, be able to renew existing contracts (on the same or better terms, or at all) or be able to replace any revenues lost upon expiration or completion of any particular contract. Our inability to renew existing contracts may also result in significant expenses from the removal of our displays. Furthermore, if and when we do obtain a contract, we are generally required to incur significant start-up expenses. The costs of bidding on contracts and the start-up costs associated with new contracts we may obtain may significantly reduce our cash flow and liquidity.
Current wording
Our business requires us to develop and maintain strong relationships with officials, regulatory authorities and private landlords. Many of our contracts with municipalities and other authorities require us to participate in competitive bidding processes at each renewal and have revenue-share requirements, capital expenditure requirements and/or fixed payment components. Competitive bidding processes are complex and sometimes lengthy, and substantial costs may be incurred in connection with preparing bids. Our competitors, individually or through relationships with third parties, may be able to provide municipalities with different or greater capabilities, prices or benefits than we can provide. We have not been, and will not be, awarded all of the contracts on which we bid. There can be no assurance that we will win any particular bid, be able to renew existing contracts (on the same or better terms, or at all) or be able to replace any revenues lost upon expiration or completion of any particular contract. Our inability to renew existing contracts may also result in significant expenses from the removal of our displays. Furthermore, if and when we do obtain a contract, we are generally required to incur significant start-up expenses. The costs of bidding on contracts and the start-up costs associated with new contracts we may obtain may significantly reduce our cash flow and liquidity.
Previous wording
•We may expend substantial cost and managerial time and effort to prepare bids and proposals for contracts that we may not win;
Current wording
•We may expend substantial costs and managerial time and effort to prepare bids and proposals for contracts that we may not win;
Previous wording
•We may be unable to comply, or it may require substantial cost to comply, with various regulatory requirements and disclosure requests related to environmental, social and governance (“ESG”) standards that are required or are recommended to win certain contracts with municipalities and transit authorities, particularly within the U.K. and the E.U.;
Current wording
•We may be unable to comply, or it may require substantial cost to comply, with various regulatory requirements and disclosure requests related to environmental, social and governance (“ESG”) standards that are required or are recommended to win certain contracts with municipalities and transit authorities in jurisdictions such as California;
Previous wording
Our inability to successfully negotiate, renew or complete these contracts due to third-party or governmental demands and delay, and the highly competitive bidding processes for these contracts, could affect our ability to offer these products to our customers, or to offer them to our customers at rates that are competitive to other forms of advertising, without adversely affecting our financial results.
Current wording
Our inability to successfully negotiate, renew or complete these contracts due to third-party or governmental demands and delay, and the highly competitive bidding processes for these contracts, could affect our ability to offer these products to our customers, or to offer them to our customers at rates that are competitive with other forms of advertising, without adversely affecting our financial results.
Previous wording
We operate in a highly competitive industry, and we may not be able to maintain or increase our current advertising revenues. We compete for advertising revenue with other out-of-home advertising businesses, as well as with other media, such as mobile; social media; online; broadcast, cable and streaming television; radio; print media and direct mail, within their respective markets. Market shares are subject to change for various reasons, including through consolidation of our competitors through processes such as mergers and acquisitions, which could have the effect of reducing our revenue in a specific market. Our competitors may develop technology, services or advertising media that are equal or superior to those that we provide or that achieve greater market acceptance and brand recognition than we achieve. It also is possible that new competitors may emerge and rapidly acquire significant market share in any of our business segments, subject to applicable regulations. Many of these competitors possess greater technical, human and other resources than we do, and we may lack sufficient financial or other resources to maintain or improve competitive position.
Current wording
The U.S. out-of-home advertising industry is fragmented and highly competitive, consisting of other large companies as well as numerous smaller, local players. We also compete with other forms of advertising, including mobile, social media, online, broadcast, cable and streaming television, radio, print, direct mail and more. Market shares are subject to change for various reasons, including through consolidation of our competitors through processes such as mergers and acquisitions, which could have the effect of reducing our revenue in a specific market. Our competitors may develop technology, services or advertising media that are equal or superior to those that we provide. It is also possible that new competitors may emerge. Many of these competitors possess greater technical, human and other resources than we do, and we may lack sufficient financial or other resources to maintain or improve competitive position.
Previous wording
Moreover, the advertiser/agency ecosystem is diverse and dynamic, with advertiser/agency relationships subject to change. This could have an adverse effect on us if an advertiser customer shifts its relationship to an agency with whom we do not have as strong a relationship. An increased level of competition for advertising dollars may lead to lower advertising rates as we attempt to retain customers or may cause us to lose customers to our competitors who offer lower rates that we are unable or unwilling to match.
Current wording
Moreover, the advertiser/agency ecosystem is diverse and dynamic and also subject to consolidation. Our relationships with advertisers and agencies are subject to change, and if an advertising customer shifts its relationship to an agency with whom we do not have as strong a relationship, our business can be adversely affected. An increased level of competition for advertising dollars may lead to lower advertising rates as we attempt to retain customers or may cause us to lose customers to our competitors who offer lower rates that we are unable or unwilling to match.
Previous wording
Regulations and consumer concerns regarding privacy, digital services, data protection and the use of artificial intelligence, or any failure to comply with these regulations, could hinder our operations.
Current wording
Regulations, consumer concerns and other challenges regarding privacy, digital services, data protection and the use of artificial intelligence, or any failure to comply with these regulations, could hinder our operations.
Previous wording
We obtain certain types of information from users of our technology platforms, including, without limitation, our websites, web pages, interactive features, social media pages, mobile applications and programmatic offerings. We also obtain anonymous and/or aggregated audience behavior insights about consumers from vetted third-party data providers. In addition, we collect information, including PII, from our employees, users of our public bike services, our business partners and consumers who interact with the marketing content on our digital panels, including through data partner collection from cellular devices, scanning QR codes and beacon technology. We use and share this information from and about consumers, business partners and advertisers for a variety of business purposes. Collecting and processing information about individuals subjects us to certain privacy and data security laws and regulations, as well as risks of unauthorized access to such information.
Current wording
We obtain certain types of information from users of our technology platforms, including, without limitation, our websites, web pages, interactive features, social media pages, mobile applications and programmatic offerings. We also obtain anonymous and/or aggregated audience behavior insights, such as aggregated historical mobile location data, about consumers from vetted third-party data providers. In addition, we collect information, including personal information, from our employees, our business partners and consumers who interact with the marketing content on our digital panels, including through data partner collection from cellular devices, scanning QR codes and beacon technology. We use and share this information from and about consumers, business partners and advertisers for a variety of business purposes. Collecting and processing information about individuals subjects us to certain privacy and data security laws and regulations, as well as risks of unauthorized access to such information.
Previous wording
We are subject to a number of federal, state, local and foreign laws and regulations relating to consumer protection, information security, data protection and privacy, including the California Consumer Privacy Act, the California Privacy Rights Act, the E.U. and U.K. General Data Protection Regulations, the E.U. Privacy and Electronic Communications Regulation, the U.K. Data Protection Act, the Singapore Personal Data Protection Act and the Brazilian General Data Protection Law, among others, and we expect to be subject to additional similar laws in the future. In the U.S., individual states continue to enact new privacy laws and regulations. Many of these laws and regulations are still evolving and could be interpreted or enforced by the courts or regulators in ways that could affect our ability to provide audience behavioral insights or monitor our business processes or otherwise harm our business. Furthermore, new regulatory approaches to privacy in public spaces by the U.S. Federal Trade Commission and other regulators, which may affect the operation of our RADAR products, are now being enforced. Any efforts required to comply with these laws and regulations and others that may be enacted may require expenditure of substantial expenses, may divert resources from other initiatives and projects and/or could limit the services we are able to offer. In addition, changes in consumer expectations and demands regarding privacy and data protection could restrict our ability to collect, use, disclose and derive economic value from demographic and other information related to our consumers, business partners and advertisers. Such restrictions could limit our ability to offer tailored advertising opportunities to our business partners and advertisers, and privacy activist interpretation of our activities could damage our reputation.
Current wording
We are subject to a number of federal, state, local and foreign laws and regulations relating to consumer protection, information security, data protection and privacy, and we expect to be subject to additional laws in the future. In the U.S., individual states continue to enact new privacy laws and regulations. Many of these laws and regulations are evolving and could be interpreted or enforced by the courts or regulators in ways that could affect our ability to provide audience behavioral insights or monitor our business processes or otherwise harm our business. Furthermore, new regulatory approaches to privacy in public spaces by the U.S. Federal Trade Commission and other regulators, which may affect the operation of our RADAR products, are now being enforced. Any efforts required to comply with these laws and regulations and others that may be enacted may require expenditure of substantial expenses, may divert resources from other initiatives and projects, and/or could limit the services we are able to offer. In addition, changes in consumer expectations and demands regarding privacy and data protection could restrict our ability to collect, use, disclose and derive economic value from demographic and other information related to our consumers, business partners and advertisers. Such restrictions could limit our ability to offer tailored advertising opportunities to our business partners and advertisers, and privacy activist interpretation of our activities could damage our reputation.
Previous wording
Although we have implemented technical controls in the form of physical and electronic security measures designed to protect against the loss, misuse and alteration of our websites, digital assets, proprietary business information and any information, including PII that we collect and share with others, no security measures are perfect and impenetrable, and we and outside parties we interact with may be unable to anticipate or prevent unauthorized access. Moreover, our systems, servers and platforms may be vulnerable to computer viruses or physical or electronic break-ins and similar disruptions that our security measures may not detect, which could cause interruptions or slowdowns of our digital display systems, delays in communication or loss of data and slowdown or unavailability of our client-facing or internal platforms. A cyber incident may be due to the actions of outside parties, employee error, malfeasance or a combination of these or other actions. The risk of a security breach or disruption, particularly through cyber-attacks or cyber intrusions, including by computer hackers, nation-state-affiliated actors and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased as well. We have experienced, and may in the future experience, whether directly or through our supply chain partners, cybersecurity incidents. We have been, and expect to continue to be, the target of fraudulent calls, emails and other forms of fraudulent activities and have experienced security breaches. However, to date, such security breaches have not had a material impact on our business strategy, results of operations or financial condition. While prior cybersecurity incidents have not had a material impact on the Company, future cybersecurity incidents, including breaches, could have a material impact on our business, operations and reputation.
Current wording
Although we maintain a cybersecurity program, no security measures are perfect and impenetrable, and we, and outside parties we interact with, may be unable to anticipate or prevent unauthorized access of our websites, digital assets, proprietary business information and any information, including PI that we collect and share with others. Moreover, our systems, servers and platforms are vulnerable to computer viruses, physical or electronic break-ins and similar disruptions that our security measures may not detect, which could cause interruptions or slowdowns of our digital display systems, delays in communication or loss of data and slowdown or unavailability of our client-facing or internal platforms. A cyber incident may be due to the actions of outside parties, employee error, malfeasance or a combination of these or other actions. The risk of a security breach or disruption, particularly through cyber-attacks or cyber intrusions, including by computer hackers, nation-state-affiliated actors and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased as well. The rapid evolution of AI is only expected to increase the complexity of cyber-attacks and cyber intrusions. We have experienced, and may in the future experience, whether directly or through our supply chain partners, cybersecurity incidents. We have been, and expect to continue to be, the target of fraudulent calls, emails and other forms of fraudulent activities and have experienced security breaches. Future cybersecurity incidents, including breaches, could have a material impact on our business, operations and reputation.
Previous wording
If an actual or perceived breach of our security occurs, our digital display systems and other business assets could suffer disruption, and we could lose competitively sensitive business information and intellectual property or lose control of our information processes or internal controls. In addition, the public perception of the effectiveness of our security measures or services could be harmed, and we could lose employees, customers, consumers and business partners as a result thereof. In the event of a security breach, we could suffer financial exposure in connection with demands from perpetrators, penalties and fines, remediation efforts, investigations and legal proceedings and changes in our security and system protection measures. Additionally, cybersecurity has become a top priority for regulators around the world, and every state in the U.S. and most other countries have laws in place requiring companies to notify users if there is a security breach that compromises certain categories of their PII, or to notify governmental agencies and/or disclose to investors if there have been material cybersecurity breaches or incidents. Any failure or perceived failure by us to comply with these laws, rules and regulations may subject us to significant regulatory fines and private litigation, any of which could harm our business.
Current wording
If an actual or perceived breach of our security occurs, our digital display systems and other business assets could suffer disruption, and we could lose competitively sensitive business information and intellectual property or lose control of our information processes or internal controls. In addition, the public perception of the effectiveness of our security measures or services could be harmed, and we could lose employees, customers, consumers and business partners as a result thereof. In the event of a security breach, we could suffer financial exposure in connection with demands from perpetrators, penalties and fines, remediation efforts, investigations and legal proceedings and changes in our security and system protection measures. Additionally, cybersecurity has become a top priority for regulators around the world, and every state in the U.S. and most other countries have laws in place requiring companies to notify users if there is a security breach that compromises certain categories of their PI, or to notify governmental agencies and/or disclose to investors if there have been material cybersecurity breaches or incidents. Any failure or perceived failure by us to comply with these laws, rules and regulations may subject us to significant regulatory fines and private litigation, any of which could harm our business.
Previous wording
U.S. federal, state and local regulations have a significant impact on the out-of-home advertising industry and our business. One of the seminal laws for our business is the U.S. Highway Beautification Act (the “HBA”), which regulates out-of-home advertising on controlled roads in the U.S. The HBA regulates the size and placement of billboards, requires the development of state standards, mandates state compliance programs, promotes the expeditious removal of illegal signs and requires just compensation for takings on controlled roads. Construction, repair, maintenance, upgrade, lighting, height, size, spacing, placement and permitting of billboards are also regulated by federal, state and local governments, and from time to time, states and municipalities have prohibited or significantly limited the construction of new out-of-home advertising structures. Due to such regulations, it has become increasingly difficult to develop new out-of-home advertising locations.
Current wording
U.S. federal, state and local regulations have a significant impact on the out-of-home advertising industry and our business. One of the seminal laws for our business is the HBA, which regulates out-of-home advertising on controlled roads in the U.S., including billboard size and placement. All states have passed billboard control statutes and regulations generally governing the construction, repair, maintenance, upgrade, lighting, height, size, spacing, placement and permitting of out-of-home advertising structures. Internationally, countries where we operate have similar regulations. Many of these regulations also govern the development of new out-of-home locations and address the use of new technologies for changing displays, including digital displays, with some existing U.S. and international regulations restricting or prohibiting their use. Due to such regulations, it has become increasingly difficult to develop new out-of-home advertising locations.
Previous wording
International regulation of the out-of-home advertising industry varies by municipality, region and country, but generally limits the size, placement, nature and density of out-of-home displays. Other regulations limit the subject matter, animation and language of out-of-home displays. Our failure or perceived failure to comply with these or any future regulations, including those that may regulate the energy consumption affiliated with the operation of advertising structures, could have an adverse impact on the effectiveness of our displays or their attractiveness to customers as an advertising medium. As a result, we may experience a significant impact on our operations, revenue, international customer base and overall financial condition.
Current wording
Our failure or perceived failure to comply with these or any future regulations, including those that may regulate the energy consumption affiliated with the operation of advertising structures, could have an adverse impact on the effectiveness of our displays or their attractiveness to customers as an advertising medium.
Previous wording
We intend to continue to expand the global deployment of digital billboards. We have encountered regulations that restrict or prohibit digital displays. Additionally, since digital billboards have been developed and introduced relatively recently into the market on a large scale, existing regulations that currently do not apply to them by their terms could be revised or further interpreted, or new regulations could be enacted, to impose greater restrictions on digital billboards due to alleged concerns over aesthetics or driver safety. Any new restrictions on digital billboards could have a material adverse effect on both our existing inventory of digital billboards and our plans to expand our digital deployment. Additionally, deploying a new digital billboard or converting an existing printed billboard to digital typically requires application for a new permit, often pursuant to a regulatory process that may include multiple public hearings, ordinance amendments and, in some states such as California, environmental review, among other requirements that are beyond our control. There is no guarantee that we will be able to obtain such permits in a timely manner, or at all, to accomplish our digital deployment and conversion goals.
Current wording
We intend to continue to expand the deployment of digital billboards. Since digital billboards have been developed and introduced relatively recently into the market on a large scale, existing regulations that currently do not apply to them by their terms could be revised or further interpreted, or new regulations could be enacted, to impose greater restrictions on digital billboards due to alleged concerns over aesthetics or driver safety. Any new restrictions on digital billboards could have a material adverse effect on both our existing inventory of digital billboards and our plans to expand our digital deployment. Additionally, deploying a new digital billboard or converting an existing printed billboard to digital typically requires application for a new permit, often pursuant to a regulatory process that may include multiple public hearings, ordinance amendments and, in some states such as California, environmental review, among other requirements that are beyond our control.
Previous wording
A number of state and local governments have implemented or initiated taxes, fees and registration requirements in an effort to decrease or restrict the number of outdoor signs and/or to raise revenue. From time to time, legislation also has been introduced in international jurisdictions attempting to impose taxes on revenue from out-of-home advertising for the right to use out-of-home advertising assets or for the privilege of engaging in the out-of-home advertising business. Several jurisdictions have imposed such taxes as a percentage of our out-of-home advertising revenue generated in that jurisdiction or based on the size of the billboard and type of display technology. In addition, some jurisdictions have taxed our personal property and leasehold interests in advertising locations using various valuation methodologies. We expect U.S. and foreign jurisdictions to continue to attempt to impose such taxes as a way of increasing revenue. The increased imposition of these measures, and our inability to overcome any such measures, could adversely affect our operating income if we are unable to pass on the cost of these items to our customers or absorb them into our current operations as a cost of doing business.
Current wording
A number of state and local governments have implemented or initiated taxes, fees and registration requirements in an effort to decrease or restrict the number of outdoor signs and/or to raise revenue. We expect jurisdictions to continue to attempt to impose such taxes as a way of increasing revenue. The increased imposition of these measures, and our inability to overcome any such measures, could adversely affect our operating income if we are unable to pass on the cost of these items to our customers or absorb them into our current operations as a cost of doing business.
Previous wording
As the owner or operator of various real estate properties and facilities, we must comply with various foreign, federal, state and local environmental, health, safety and land use laws and regulations, including those relating to the use, storage, disposal, emission and release of carbon and hazardous and non-hazardous substances; employee health and safety; and zoning restrictions. In addition, increased scrutiny related to ESG, and actual and proposed ESG policies and regulations, including proposed new or enhanced requirements regarding the standardization of mandatory climate-, human capital- and diversity-related disclosures for companies in the E.U., the U.K. and the U.S., including the California Climate Corporate Accountability Act of 2023, the E.U. Corporate Sustainability Reporting Directive and the proposed SEC Climate Rule, will subject us to new regulatory and compliance costs. Historically, we have not incurred significant expenditures to comply with environmental or ESG laws, policies and regulations. However, given the increase in the number and complexity of these policies and regulations, we expect our costs of compliance to increase in 2024 and thereafter. In addition, we have announced commitments to achieving Carbon Net Zero before 2050 across our divisions and have established an environmental program framework. There can be no assurance that we will be successful in reaching our stated goals, that activists and others will not challenge our progress towards those goals or their establishment, that our environmental framework will operate adequately or, if we are successful, that the cost will not be material. Furthermore, additional laws, policies and regulations that may be passed in the future, or a finding of a violation of or liability under existing laws, could require us to make significant expenditures and otherwise limit or restrict some of our operations.
Current wording
As the owner or operator of various real estate properties and facilities, we must comply with various foreign, federal, state and local environmental, health, safety and land use laws and regulations, including those relating to the use, storage, disposal, emission and release of carbon and hazardous and non-hazardous substances; employee health and safety; and zoning restrictions. In addition, actual and proposed ESG policies and regulations, including proposed new or enhanced requirements regarding the standardization of mandatory climate-related disclosures, may subject us to new regulatory and compliance costs.
Previous wording
We are engaged in processes to sell the businesses in our Europe-North segment and in Latin America. There can be no assurance that we will be successful in identifying or completing these processes, that any such transactions will result in additional value for our stockholders or that these processes will not have an adverse impact on our business.
Current wording
We have entered into an agreement to sell the businesses in our Europe-North segment and intend to sell our businesses in Spain and Brazil. There can be no assurance that these processes will be successful, that any transactions will result in value for our stockholders, or that these processes will not have an adverse impact on our business.
Previous wording
In addition, we may not be able to identify and/or complete any transactions with respect to our Europe-North or Latin American businesses. Any additional potential transactions will not be conditioned on each other and will depend upon a number of factors, including, but not limited to, market conditions, industry trends, the interest of third parties in our European and Latin American businesses and the availability of financing to potential buyers. We cannot make any assurances that any potential transactions or other strategic alternatives, if identified, evaluated and completed, will provide greater value to our stockholders than that reflected in the current price of our common stock.
Current wording
In addition, we may not be able to identify any transactions with respect to our businesses in Spain and Brazil. Any potential transactions will depend upon a number of factors, including, but not limited to, regulatory conditions and approvals, market conditions, industry trends, the interest of third parties in such operations, and the availability of financing to potential buyers. We cannot make any assurances that any potential transactions or other strategic alternatives, if identified, evaluated and completed, will provide greater value to our stockholders than that reflected in the current price of our common stock.
Previous wording
Finally, we are simultaneously continuing to focus on executing our operating plan, including improving financial results, expanding our advertiser base, optimizing our deployment of capital and reducing corporate expenses. These actions include initiatives such as growing key verticals in the U.S., developing channels to advertisers, turning around challenged markets, reviewing our corporate expenses as our portfolio simplifies, and the deployment of proceeds from our divestitures to improve our liquidity position and reduce debt. There can be no guarantee that any of these actions and initiatives will produce the benefits we expect.
Current wording
Finally, we are simultaneously continuing to focus on executing our operating plan, including improving financial results, expanding our advertiser base, optimizing our deployment of capital and reducing corporate expenses. These actions include initiatives such as growing key verticals in the U.S., developing channels for advertisers, turning around challenged markets, reviewing our corporate expenses as our portfolio simplifies, and improving our liquidity position and reducing debt. There can be no guarantee that any of these actions and initiatives will produce the benefits we expect.
Previous wording
The recent dispositions or agreements to dispose of the businesses in our Europe-South segment and the potential dispositions of our other international businesses, as well as other strategic transactions or acquisitions, pose risks.
Current wording
The dispositions of the businesses in our Europe-South segment and of certain businesses in Latin America, the agreed-upon disposition of the businesses in our Europe-North segment, and the potential dispositions of our businesses in Spain and Brazil, as well as other strategic transactions or acquisitions, pose risks.
Previous wording
We have pursued and are pursuing strategic dispositions of certain businesses, including the sales of our businesses in Switzerland, Italy and France and our announced agreement to sell our business in Spain, as well as the processes to sell the businesses in our Europe-North segment and in Latin America. We may also pursue other strategic transactions, including recapitalization or other corporate restructurings, including, for example, a real estate investment trust (“REIT”) conversion in the future. These dispositions, other strategic transactions or acquisitions could be material. Such transactions involve numerous risks, including:
Current wording
As described above, we have pursued or are pursuing strategic dispositions of certain businesses. We may also pursue other strategic transactions, including recapitalization or other corporate restructurings, including, for example, a real estate investment trust (“REIT”) conversion in the future. These dispositions, other strategic transactions or acquisitions could be material.
Previous wording
•Our dispositions, including the dispositions of the businesses in our Europe-South segment and potential dispositions of our other international businesses, may negatively impact revenues from our national, regional and other sales networks or make it difficult to generate cash flows from operations sufficient to meet our anticipated cash requirements, including our debt service requirements;
Current wording
•The completed dispositions of the businesses in our Europe-South segment and in Mexico, Peru and Chile, the agreed-upon disposition of the businesses in our Europe-North segment, and potential dispositions of our businesses in Brazil and Spain, may negatively impact revenues from our national, regional and other sales networks or make it difficult to generate cash flows from operations sufficient to meet our anticipated cash requirements, including our debt service requirements;
Previous wording
•We may not achieve the expected benefits from the dispositions of the businesses in our Europe-South segment and potential dispositions of our other international businesses, including our transformation into a more focused U.S.-centric out-of-home operator with less debt and enhanced optionality to become a REIT, improved margins and profits and increased stockholder value;
Current wording
•We may not achieve the expected benefits from the completed or potential dispositions, including our transformation into a more focused U.S.-centric out-of-home operator with less debt and enhanced optionality to become a REIT, improved margins and profits, and increased stockholder value; and
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Current report — wording carried from elsewhere
In addition, we have announced certain environmental commitments and established a framework to support our environmental program. There can be no assurance that we will be successful in reaching our stated goals, that activists and others will not challenge our progress towards those goals or their establishment, that our environmental framework will operate adequately or, if we are successful, that the cost will not be material. Furthermore, additional laws, policies and regulations that may be passed in the future, or a finding of a violation of or liability under existing laws, could require us to make significant expenditures and otherwise limit or restrict some of our operations.
Current report — wording carried from elsewhere
Our dispositions involve numerous risks, including:
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
In addition, the stock markets have experienced extreme price and volume fluctuations that have affected, and continue to affect, the market prices of equity securities of many companies. Historically, stockholders have instituted securities class action litigation or launched activist campaigns following periods of market volatility. If we were involved in securities litigation or an activist campaign, we could incur substantial costs, and our resources and the attention of management could be diverted from our business.
Previous report — wording carried elsewhere
•continued economic uncertainty, an economic slowdown or a recession;