Boston Omaha(BOC) - 2020 Q4 - Annual Report

Business Operations - The company operates three main business lines: outdoor billboard advertising, surety insurance, and broadband services, with a focus on acquiring additional billboard assets[22] - As of March 26, 2021, the company operates approximately 3,200 billboards with around 6,000 advertising faces, having increased its billboard count through acquisitions[24] - The surety insurance business has expanded its licensing to all 50 states and the District of Columbia since acquiring United Casualty and Surety Insurance Company in December 2016[27] - AireBeam, a subsidiary, provides high-speed fixed wireless internet service to over 7,000 subscribers in southern Arizona and is building a fiber-to-the-home network[29] Financial Performance and Investments - The company anticipates continued losses for the foreseeable future, which may impact its financial condition and results of operations[13] - The company aims to grow intrinsic value per share by retaining capital for reinvestment and exploring new investment opportunities[40] - The company has made significant minority investments, including $10 million in Dream Finders Holdings LLC and$19 million in CB&T Holding Corporation, focusing on sectors like homebuilding and subprime automobile lending[34][35] - The company has spent over $280 million on acquisitions in outdoor billboard advertising, surety insurance, and broadband services since June 2015[58] - The company has engaged in acquisitions and minority investments totaling$423,648,471 since management took over in 2015, funded by equity investments and debt conversions[86] Acquisitions - Boston Omaha Corporation acquired approximately 3,200 billboard structures with around 6,000 advertising faces for over $190 million[59] - The company paid approximately$19.4 million for the acquisition of one insurance company and four insurance brokerage firms since September 2015[60] - AireBeam was acquired for $12.3 million, providing high-speed internet to over 7,000 subscribers in underserved Arizona communities[61] - UBB was acquired for$21.3 million, serving over 10,000 subscribers in Salt Lake City and surrounding areas[61] - The company acquired substantially all assets of FibAire and UBB, broadband service providers located in Arizona and Utah, respectively, in March and December 2020[89] Market Conditions and Competition - The outdoor billboard advertising market was estimated at $4.7 billion in the U.S. in 2020, with additional outdoor advertising solutions accounting for approximately$1.4 billion[77] - The surety market was estimated at $6.9 billion based on 2019 industry reports, with the company acquiring four surety brokerage firms to enhance its revenue streams[80] - The outdoor advertising industry is highly competitive, with major players generating over 50$23,057,650, with $1,282,504 classified as current[148] - The company reported a net loss from operations of$4.0 million for the fiscal year ended December 31, 2020, compared to a net loss of $12.4 million for the fiscal year ended December 31, 2019[163] - The company may incur additional indebtedness under future credit facilities, which could include restrictive covenants that may adversely affect its financial condition[201] - Future debt financing arrangements may contain covenants that, if not complied with, could materially affect the company's ability to meet its debt obligations[200] Employee and Operational Structure - As of March 1, 2021, the company had 217 employees, with the majority in billboard and broadband operations[111] - The company has limited experience in the day-to-day operations of the industries in which it operates, which may affect operational efficiency[174]