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EXHIBIT 99.2
LAMAR ADVERTISING COMPANY
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The following sets forth unaudited pro forma condensed consolidated
financial information for the Company. The unaudited pro forma condensed
consolidated statements of loss for the year ended December 31, 1998 and for the
nine month period ended September 30, 1998 give effect to the acquisition of
Outdoor Communications, Inc. as if the transaction had occurred on January 1,
1998.
For purposes of the pro forma financial information (i) the statement of
operations of the Company for its fiscal year ended December 31, 1998 has been
combined with the statement of loss of Outdoor Communications, Inc. for the nine
months ended September 30, 1998, ( the acquisition was consummated on October 1,
1998) (ii) the statement of operations of the Company for the nine month period
ended September 30, 1998 has been combined with the statement of loss of Outdoor
Communications Inc. for the same period and (iii) the balance sheet of the
Company as of September 30, 1998 has been combined with the balance sheet of
Outdoor Communications Inc. as of September 30, 1998.
The unaudited pro forma condensed consolidated financial statements give
effect to the acquisition under the purchase method of accounting. The pro forma
adjustments are described in the accompanying notes and are based on preliminary
estimates and certain assumptions that management of the Company believes
reasonable under the circumstances.
The unaudited pro forma condensed consolidated financial statements have
been prepared by the Company's management. The unaudited pro forma data are not
designed to represent and do not represent what the Company's results of
operations or financial position would have been had the aforementioned
acquisition been completed on or as of the dates assumed, and are not intended
to project the Company's results of operations for any future period or as of
any future date. The unaudited pro forma condensed consolidated financial
statements should be read in conjunction with the audited and unaudited
consolidated financial statements and notes of the Company and Outdoor
Communications, Inc. included elsewhere or incorporated herein by reference.
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LAMAR ADVERTISING COMPANY
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF LOSS
YEAR ENDED DECEMBER 31, 1998
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
PRO FORMA
ACQUISITION COMBINED
LAMAR OCI ADJUSTMENTS AS ADJUSTED
----------- ----------- ----------- -----------
Revenues, net $ 288,588 44,166 0 332,754
----------- ----------- ----------- -----------
288,588 44,166 0 332,754
----------- ----------- ----------- -----------
Direct advertising expenses 92,849 15,932 0 108,781
General and administrative expenses 60,935 12,387 (3,660)(2) 69,662
Depreciation and Amortization 88,572 10,607 13,626 (3) 112,805
----------- ----------- ----------- -----------
242,356 38,926 9,966 291,248
----------- ----------- ----------- -----------
Operating income 46,232 5,240 (9,966) 41,506
----------- ----------- ----------- -----------
Other expense (income):
Interest income (762) 0 0 (762)
Interest expense 60,008 10,590 9,983 (1) 80,581
Loss (gain) on disposition of assets (1,152) 423 0 (729)
Other expenses 219 95 0 314
----------- ----------- ----------- -----------
58,313 11,108 9,983 79,404
----------- ----------- ----------- -----------
Loss before income taxes (12,081) (5,868) (19,949) (37,898)
Income tax expense (benefit) (191) (2,207) (3,970)(4) (6,368)
----------- ----------- ----------- -----------
Net loss (11,890) (3,661) (15,979) (31,530)
=========== ===========
Preferred stock dividends 365 365
----------- -----------
Net loss applicable to common stock $ (12,255) (31,895)
=========== ===========
Net loss per common share ($0.24) ($0.62)
=========== ===========
Weighted average number of shares outstanding 51,361,522 51,361,522
=========== ===========
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LAMAR ADVERTISING COMPANY
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF LOSS
NINE MONTHS ENDED SEPTEMBER 30, 1998
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
PRO FORMA
ACQUISITION COMBINED
LAMAR OCI ADJUSTMENTS AS ADJUSTED
----------- ----------- ----------- -----------
Revenues, net $ 201,600 44,166 0 245,766
0
----------- ----------- ----------- -----------
201,600 44,166 0 245,766
----------- ----------- ----------- -----------
Direct advertising expenses 64,696 15,932 0 80,628
General and administrative expenses 43,178 12,387 (3,660)(2) 51,905
Depreciation and Amortization 57,053 10,607 13,626 (3) 81,286
----------- ----------- ----------- -----------
164,927 38,926 9,966 213,819
----------- ----------- ----------- -----------
Operating income 36,673 5,240 (9,966) 31,947
----------- ----------- ----------- -----------
Other expense (income):
Interest income (359) 0 0 (359)
Interest expense 39,357 10,590 9,983(1) 59,930
Loss on disposition of assets 619 423 0 1,042
Other expenses 272 95 0 367
----------- ----------- ----------- -----------
39,889 11,108 9,983 60,980
----------- ----------- ----------- -----------
Loss before income taxes (3,216) (5,868) (19,949) (29,033)
Income tax expense (benefit) 816 (2,207) (3,970)(4) (5,361)
----------- ----------- ----------- -----------
Net Loss (4,032) (3,661) (15,979) (23,672)
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Preferred stock dividends 365 365
----------- -----------
Net loss applicable to common stock $ (4,397) (24,037)
=========== ===========
Net loss per common share ($0.09) ($0.48)
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Weighted average number of shares outstanding 50,076,742 50,076,742
=========== ===========
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LAMAR ADVERTISING COMPANY
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 1998
(DOLLARS IN THOUSANDS)
PROFORMA PRO FORMA
LAMAR OCI ADJUSTMENTS COMBINED
---------- ---------- ----------- ----------
Cash 6,224 512 (1,089) (5) 5,647
Net receivables 34,281 7,083 149 (6) 41,513
Other current assets 13,034 2,900 (668) (7) 15,266
---------- ---------- ---------- ----------
Total current assets 53,539 10,495 (1,608) 62,426
---------- ---------- ---------- ----------
Property, plant and equipment, net 401,218 62,932 34,126 (8) 498,276
---------- ---------- ---------- ----------
Intangibles 392,691 85,837 218,354 (9) 696,882
Other assets 19,090 302 (11)(10) 19,381
---------- ---------- ---------- ----------
Total assets 866,538 159,566 250,861 1,276,965
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Current maturities of long-term debt 3,950 0 45,045 (11) 48,995
Other current liabilities 33,438 4,078 4,989 (12) 42,505
---------- ---------- ---------- ----------
37,388 4,078 50,034 91,500
---------- ---------- ---------- ----------
Long-term debt 562,343 147,000 193,000 (13) 902,343
Deferred income - Long term 1,012 0 0 1,012
Preferred interest in subsidiary 0 5,484 (5,484)(14) 0
Other liabilities 2,959 2,959
Deferred tax liability 10,713 2,029 14,286 (15) 27,028
---------- ---------- ---------- ----------
Total Liabilities 614,415 158,591 251,836 1,024,842
---------- ---------- ---------- ----------
Stockholders' equity 252,123 975 (975)(16) 252,123
---------- ---------- ---------- ----------
Total liabilities and stockholders' equity 866,538 159,566 250,861 1,276,965
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For purposes of determining the pro forma effect of the Outdoor Communications,
Inc. acquisition on the Company's Condensed Consolidated Statements of
Operations for the year ended December 31, 1998 and the unaudited Condensed
Consolidated Statements of Operations for the nine months' ended September 30,
1998, the following adjustments have been made:
(1) To eliminate historical interest expense in OCI's financial
statements and record interest expense related to the debt acquired
in the acquisition:
Historical interest expense (10,590)
Interest expense on debt acquired 20,573
---------
9,983
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(2) To eliminate expenses in OCI's historical income statement related
to corporate offices not retained and record the actual expenses
that would have been incurred had the transaction taken place at the
beginning of the period:
Historical corporate expenses (3,760)
Actual additional corporate expenses 100
---------
(3,660)
=========
(3) To record incremental amortization and depreciation due to the
application of purchase accounting. Depreciation and amortization
are calculated using accelerated and straight line methods over the
estimated useful lives of the assets. 13,626
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(4) To record the tax effect on pro forma statements
for the acquisition (3,970)
=========
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For purposes of determining the pro forma effect of the Outdoor Communications,
Inc. acquisition on the Company's Unaudited Condensed Consolidated Balance Sheet
as of September 30, 1998, the following adjustments have been made:
Pro Forma
Adjustments
-----------
(5) Cash:
To record cash used to finance the acquisition (1,089)
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(6) Net receivables
To reclassify balance sheet items in order to conform
to the Company's presentation. 149
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(7) Other current assets
To reclassify balance sheet items in order to conform
to the Company's presentation. (591)
To eliminate historical assets not acquired in the
transaction. (77)
---------
(668)
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(8) Property, Plant and Equipment, net:
To record the increase in property, plant and equipment
from the allocation of the purchase price for the OCI acquisition 33,684
To reclassify balance sheet items in order to conform
to the Company's presentation. 442
---------
34,126
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(9) Intangibles:
To record the increase in intangibles resulting from the
allocation of the purchase price of the OCI acquisition 218,354
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(10) Other Assets:
To reclassify balance sheet items in order to conform
to the Company's presentation. (11)
=========
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(11) Current maturities of long-term debt:
To record the increase in short-term debt related to the
financing of the OCI acquisition 45,045
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(12) Other current liabilities:
To reclassify balance sheet items in order to conform
to the Company's presentation. (11)
To record the increase in accrued expenses related
to the OCI acquisition. 5,000
---------
4,989
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(13) Long-term debt:
To record the net increase in debt related to financing the OCI
acquisition and the elimination of debt not assumed in the
acquisition.
Borrowings under the Credit Facility 235,000
Debt not assumed in the acquisition (42,000)
---------
193,000
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(14) Preferred interest in subsidiary
To eliminate OCI's historical accounts not acquired
as a result of the acquisition (5,484)
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(15) Deferred Tax Liability:
To record the increase in the deferred tax liability
created as a result of the application of purchase
accounting. 14,286
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(16) Stockholders' Equity
To eliminate OCI's historical stockholders' equity
as a result of the acquisition (975)
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