LAMR - Earnings call transcript Q3 2024 | Lamar Advertising Company

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Operator

Excuse me everyone. We now have Sean Reilly and Jay Johnson in conference. [Operator Instructions]. In the course of this discussion, Lamar may make forward-looking statements regarding the company, including statements about its future financial performance, strategic goals, plans and objectives, including with respect to the amount and timing of any distributions to stockholders and the impacts and effects of general economic conditions on the company's business, financial condition and results of operations.

All forward-looking statements involve risks, uncertainties and contingencies, many of which are beyond Lamar's control and which may cause actual results to differ materially from anticipated results. most factors those cause third discussed earnings and important differ results quarter identified on release from report materially in its has that actual could to XXXX Form Lamar XX-K. annual recent the company's to Lamar refers documents. you those

XXXX Form quarter contains which and the available X-K regarding this release, Regulation furnished to Investors information measures on Lamar's non-GAAP morning financial earnings was by website, section the G third Lamar's required certain SEC www.lamar.com. of on is

to like Mr. begin. now I conference Reilly. the would to Sean turn Reilly, over you may

Sean Reilly

to Thank QX continue morning you, we Brittany. to Good encouraging be Earnings all, near trends and Business welcome end. Lamar's Call. year as XXXX to

our weakness For advertising from remained and the and advertisers from base. quarter, which regional local demand helped offset sales our programmatic channel, strength national broader we third from robust, saw particular

X% little X.X% acquisition-adjusted the year and ran Lamar. growth X.X% some increasing the or on relief of revenue an increased of transit, Revenue and versus that consolidated a received on across billboards, period. For basis, we quarter QX Expenses for of as [ meanwhile in XXth bit grants operating Recall products, regions. airport quarter, straight grew the acquisition-adjusted all all logos comp basis had earlier hot we COVID an result XXXX. a a tough ],

increase. contract this year's in labor third saw also in contributed medical spikes some to that and We the costs in quarter

levels QX expense of spend. is matter ahead a correcting this pacing of political The record news and of aided we simple was timing. revenue by QX trends Some good is in QX, of see handily

XXXX. share $X.XX a full have be which we the per range increase midpoint X% year saw, of you AFFO our raised as over to nearly result, guidance of a an at would share, $X.XX for to per As

consolidated margin should For XX%. year, the in right around full come EBITDA

political construction and particular services, government categories Back addition strength to of [indiscernible] nonprofit. QX, to in building and

categories skew All local. of these

to X.X%. tend X.X%, a basis, and that off weaker, consolidated was categories were the skew of our national. local/regional insurance restaurants was Some up national revenue On while

by as I mentioned, in Our XX% quarter the increased revenue channel, X% over with grew from the quarter. digital nearly year from programmatic revenue earlier where our particular strength,

in and are in as new such the customers programmatic to pharma see packaged goods categories out-of-home consumer new We space. continuing

On same-store large digital, basis revenue up billboard for was a [indiscernible] format X.X%.

appreciate Our that continue customers to the provides. flexibility digital

deployment to after new in XXX in is internal digitals. XXXX, an of plan of reaccelerate units So our to of a for XXX XXXX somewhat our new rollout with slowdown goal

Deal up, we begun a XXXX would has anticipate be. tuck-in as however, activity much XXXX. the for it front, transactions been flow, to has in quiet M&A expected year pick on and we more

successful to I another are to up Jay we to is believe to like walk XXXX, any you be is leave firm and it it it there I and I'll make some In for now Jay? how too shaping more although numbers. short, finishing XXXX soon turn predictions, year. through over

Jay Johnson

Thanks, Sean. for thank joining and you morning, us. Good everyone,

our experience quarter. growth continue third We portfolio in during top to solid line the

increase of Despite of the year, well in the third $XXX.X basis of approximately quarter the compared the million $XXX.X AFFO levels. Adjusted was $XXX.X XXXX. EBITDA the growth from regions Coast, million to is million and XXXX, versus operations mid-single in at pre-pandemic basis. $X.XX Diluted increased quarter $X.XX adjusted digits, third quarter X.X%. growing expenses, operating an Gulf an revenue above remains strong acquisition-adjusted per to flat, funds EBITDA grew in last low the XX.X% exception million compared quarter in for share of margin the to totaled X.X% Our billboard $XXX.X points. on was to the which in was or XX acquisition-adjusted which relatively with for X.X% an increase Adjusted X.X%

year rates Local line with regional months be during overall this quarter This the stabilizing. from growth have sales the also year. XXth benefited We've continued X in revenue solid softness national quarter, our short-term headwind of to the a first and continues mid-single-digit to top we grew interest the sales experienced AFFO but on consecutive the growth for growth.

backdrop national which the encouraged for the in of the business, of third spite of quarter. XX% approximately In are and local the regional of we revenue resilience sales, by accounted billboard

year, anticipate expenditure comprising CapEx. $XX.X $XX was capital million total Through the approximately And maintenance On the quarter maintenance. of the [indiscernible] for million of first about of of $XXX which quarters was $XX million, CapEx for including maintenance full with million year, front, the $XX.X we total CapEx million, totaled X of spend the million.

company's approximately maturity February extended term X The now loan million in and securitization on debt XXXX. have with interest well-laddered was no until matures bond the Based maturities XXXX XXXX. of company million a maintains in B and Last no month, facility X%, October weighted $XXX schedule debt maturities AR a average our years, for years. of with at we February maturity $XXX quarter average rate end, until the our weighted outstanding X we debt

we defined X.Xx to remains amongst which debt total the the As company. of EBITDA, the lowest history the facility, with net credit ended quarter ] our under in [ leverage of

incurrence we're X.Xx, debt our Xx in against test Our quarter secured secured X.XXx debt total and maintenance and compliance both was leverage at and comfortably of debt respectively. covenants end, with

and $XXX.X At on credit $XXX $XX.X we under facility. our facility. the on company's quarter, in credit cash revolving using $XXX in Earlier and a had million the hand comprised revolving of repaid approximately Loan million draw million total liquidity million we of the Term the available on our cash quarter, hand of end A

of from improved outstandings monitor notes. and capital We corporate senior purposes. have favorable environment under issue and to proceeds reduce debt for be revolver new offering we advantage significantly this markets, general use the the which may The of to would take to continue an

million. Board and approved $XXX each Directors to In programs, of our our up extension debt the repurchase September, of equity for

not our corporate activity of part and the strategy. term, our do finance under in near flexibility program both either as we preserves anticipate While maintaining

guidance mentioned, of per morning's expect our range totaled of original beginning year. while million, $X.XX morning, year the taxes projected AFFO year. midpoint the the on our this an $XXX And the Sean $X.XX in are CapEx increase come of increased this As in full guidance AFFO $XX for I this up from We for $X.XXX as and touched around million. $X.XXX budgeted an to $XX at interest time Full guidance cash we maintenance million. is earlier, year second at now cash to share,

the in the quarters. the plans company paid as Board for the approval $X.XX dividend share of Finally, first each In and to subject management the recommend second of regular $X.XX dividend per per well. we share increased same to and a quarter dividend cash to fourth QX,

current our the we line which full of to regular result on cash likely special distribute XXX% at with of also will special approximately and in In will $X.XX subject ensure approved, expectations, we results. year-end addition, will be This recommend taxable dividends policy. per is share $X.XX special the operating a dividend company's and If a of Board the dividend, depending share. income both based are our on dividend approval, year per dividend

as sales the our year. business call are we executing to the balance the in local results, saw look through for now of with the October's and back well strength Once plan the momentum quarters regional as on I'll pleased the and we our forward first turn X over again, of to Sean.

Sean Reilly

I'll Thanks, before open for up few of a I the touch metrics Jay. on it usual questions.

year-to-date. exception Political with bottom of for Jay the was political. a political a a we're records for top growth was softness. It At for bright a less the overall mentioned, across Lamar the growth. and performance quite X% our million through year-to-date line relatively was regional As and setting Coast, for Gulf meant $XX spot, in almost country, Notably, of record of bit little QX uniform which both showed basically across political. October our than also the little QX, QX

So primarily are occupancy that driven . Other QX. of around as relative rate in hovering the in we was were year-to-date. contribution peak QX gains political

close air as increase now QX. increase of XXX the units. units units was terms That digital of In X,XXX over digital have of we an of XXXX, QX in count, XXXX our of over year-to-date the XX an

in only, I in what we this X.X%. QX. In if that mentioned X.X%. terms number of this footprint, And we mentioned is was large-format airports, up same whole, the including was have up Year-to-date, again, acquired as I there and is digital growth what billboard board put same overall X% you board, year a digital transit our take and and

XX% share, In coming national/programmatic with at QX to terms programmatic local about That compares year-to-date was approximately local, -- in XX%. regional regional, XX% as Jay national of XX% in XXXX. roughly mentioned,

XX approximately a for of we activity. we about price acquisitions, acquired that new and closed acquisitions of $XX terms faces In total million, purchase through XX

XXXX As to M&A [ ] back pared our for add. I we mentioned, activity

You'll we see XXXX. move into as that accelerate

mentioned, nonprofit of weakness, up was And XX% then down XX%. right, and finally, XX%. Services and as we XX%, it categories Categories of X.X%. up for relative restaurants as open will about I services mentioned, was All up I Government Brittany, & down relative about was Building Construction insurance, questions. up strength, now

Operator

Stanley. first from Our McVeigh question with Morgan Instructions] Cameron will [Operator come

Cameron McVeigh

you're Just XXXX, drivers? growth into ahead potential growth about curious, how and look thinking the you the as opportunity

Sean Reilly

also to there. to programmatic in Certainly, a we're for we're contributor going be rebound looking a And to looking be national.

better as into in a easy be goods big but and national, come players we're through reason is we're it's in math that. use that not have packaged that to comps. to book pharma. traditionally why of to going And our going consumer customers of some do seeing Some again, out-of-home, programmatic hate been that the I

looking certainly to we're that. So

Cameron McVeigh

impacts? just spending long-term home discuss Great. could industry state the ad out And industry guess of perspective, then the current in secondly, of I an you from programmatic

Sean Reilly

Sure.

in going, buy the buying pots And we in we Lamar specialists, And is national general of buyers digital that's are advertising. type And the you hear certainly, X part that to As i.e., book from industry merge faster growing. programmatic to you're actually growing, probably number going they when and advertising that our particular, years. talking programmatically. players, to we why see see agencies our when thing. Where only the hear limit those to you'll limited customers. of those universe one, aware, much traditional channel than is we this are about programmatic the growing X digital And of same X other

would really it our and more really exciting. way, that what book, is happening you ad channel I channel that regional And finally, local call just important talk leads ad to then that conclusion up won't then more, And to spend that's be break as you'll when the is which going players. out it us our opened is programmatic to up about to that becomes book. opening so And traditional we and local see even

And there. ad get So but do, through going to whole -- it's take X us that lot X to a dollars of see when to going we years you'll channel.

Operator

Bazinet We'll take from Citi. Jason question our with next

Jason Bazinet

just about that the the it about noticed period. up, to is the guidance X% had you earnings AFFO from beginning But over where that One, see we fell I X% nice X was as of started the said, at I number questions. year. same

So of could AFFO? dichotomy I the was wondering, the tease just out and the sort you earnings just between

when my because had now but if if first the I negative applicable shift misremembering, in implications on question with on -- concerned And industry? less tone of because just you dollars just cautious know huge. of that. on the some would then it margin second are quantum it I Or no you is so And of programmatic started, makes and programmatic. just are the may be just characterize is concerns your see somewhat I longer the almost margin because don't sense? early that's programmatic

Sean Reilly

net the and the hit turn question, Jay. programmatic I'll over Jason, income I'll to Yes. question

of account is our about we pay yes, margins. runs you a executives what account what overall programmatic cost And got sale the our of about there. right? that So we and cost X%, X% XX%. a delta our today, national sales, a programmatic It So fact runs managers pay about

to willing CPM of we get set a see the that richer that prove CPM that data Now going? because the we higher and through one, our channel, customers where programmatic campaign. pay slightly a are their higher out get they Number helps do effectiveness

CPM. So bit higher that is of a little extra expense by offset

we have to going million when it. that happening it's that we're for channel it, we down. through when through XX% have cost $X go thing that going other The is million $XXX see But see going we

bring at So we're looking to volume down. cost that

Jay Johnson

income is net question, compensation plan, the noncash. know, stock which, Jason, on it's you our as

based significantly plan If where is you time stock is look around was now, And our at at it our last trading year. higher it's [indiscernible]. this than

the value impact So can . price fluctuations there. stock in really

The other than contributor on year. simply having better is year we're where last a budget. compensation plan the stock much against tracking We're

is our higher. on going a to So percentage be payout basis

X in those you that's why you So stock and increase put the compensation. things the see together,

Operator

next Daniel our question Wells Osley with take from We'll Fargo.

Daniel Osley

[indiscernible] if I may.

maybe the mentioned now. political And and think record the about $XX I million you you contribution can think seeing guess as relatedly, year-to-date out. political single a down saw as about I somewhere then us to QX? they and digit broadcasters for this contribution from help ads of report talked political digit their being core high we TV week, crowd between mid-single collectively

So up do but drop results that you quarter, out a there? got any market think the that crowd doesn't those maybe the dollars? anything completely apparent you've on seem Or can you you in bit picked those of add of advertisers did your some

Sean Reilly

heard. of I beginning but the We just what the question, lost there hit I'll you at

-- million take. give as In QX, I going to was about $XX year-to-date. about or it's political, that be mentioned, number, So is

will of to close $XX million terms political. in end we the total year So

give a we political comes much QX. of can't going So But of land -- out does. sense some that and their of know We spend it crowding where terms for that traditional way. it to will it's TV in can't you how measure in our we

sort so our in of have we're going . just growth -- book. And to in -- it our can in you the see

your that's I anecdotally happens. So those pick I what but measure question heard that not can't it, dollars. And be whether think know or up I of some it to we again,

Daniel Osley

maybe on just That's may, helpful. 'XX. more, then I if And one

the year? digital almost as conversion, potential billboards year as from about financial the uplift twice expect can might on done you benefits digital this but that some talk work we've you from So revenue adding you next did many

Sean Reilly

on X just of just make economics, sort then do I'll can illustrate based extrapolate. you and Sure. right? -- I'll unit it So I'll

over And down replace revenue conversion. to your give a it's with we Xx. or on that is, lift or about you unit you little X,XXX $XXX,XXX when doing month. that make take cost the unit, digital So average, static a a X take, And

neighborhood So $XX,XXX the of on a you're going to do month in board now. something that

sort of of economics unit that's So conversion. the a

digital they're of length a been that don't other a that it contract. can, share copy over change for stable have why have of very production. and see those They $X,XXX economics. that their And the $X,XXX buy but When to from been is slot the the the gratifying over amortize flexibility that cost the their from return to course, occupy, us for about and that of point -- they move the -- we've desktop they're their paying doing they the pay dollars. their about the they space will. And but unit that up with space those decades remarkably willing absolute It's they same at paying it's the Interestingly, over to to held And unit advertisers. that They're this. economics been the advertiser's static vinyl have they're the unit, about view, for as buy then mentioned, I to to for right. have paying substrate

in So goes thousand dollars about of their space the up. terms cost the stays same. cost the absolute per Their impressions of

So digital view that's point economics our point from the both from our conversion, of and of of view. a customers'

Operator

Our next Instructions] with JPMorgan. from Karnovsky [Operator David question

Unknown Analyst

geographies you in metrics and Two want to is mentioned known provide to color wanted and and at take in on out to the on you're This could measure share could how color more improve KPIs M&A ask increases And data any build out? there's continues. you're you David. to for had to well into if there's questions. more large secondly, this last better gaining quarter programmatic just more I looking them these [indiscernible] capabilities how ask due of provide One, room -- marketers if you're you then able specific on some as is format. to 'XX, what willing or if education opportunities to share if kind I share going for or any

Sean Reilly

M&A balance We is. it's as work Term where our our preparing year. hit fruitful incredibly been first. and catching done, retired a down all and been the And balance breath kind were sheet. sheet of terms We A purposely I'll question in know, little And we loan. bit you our of were our we that Sure. this slowed has

As XXXX, company's we history. matter the a on the books our than when close the our of fact, going as measured in to by first leverage, be covenants time for is less bank X

And part that work So we was year. the the activity down there. we're did really M&A about this of slowing happy

the be it activity at that look next if transactions, So that you of to quite going at. up. good basically level without And talking into we're, and fill-in picking is everywhere. specific first we I nationwide see activity very said, frankly, about year, footprint, the we're mean, going

to M&A And us existing inventory very very activity we the So at exercise. fill-in, just any operations. is almost it. very, where be for going predictable it's absorbed good We're into a our

the can really And in end country inventory absorb We of specific. at it's anywhere anywhere the not in day, geographic any region country. the the in basically

going next So year, customers, footprint quite frankly, be and our very looking we're to enhancing and our we're active that forward and to to to brings yes, margins. what our

what -- other What the on was was other question The question? the one?

Unknown Analyst

in gaining question -- large question had mentioned other you'd to format. programmatic I was the due share The better other in metrics

to color and I so KPIs And you if how could those on to how well ask wanted provide able you're measure more [indiscernible]?

Sean Reilly

Yes, yes. Sure.

have known campaign. and that and part are been. ever there There the can providers more those do a in traffic as are measure there industry. increasingly of of third-party providers attribution frankly, data today it's lift Quite analysis well third-party So than foot data

it buy programmatic good in And to slightly pay our like is So because thing their into included willing and again, the pipes by the higher a customers programmatic enablers, to those programmatic the buyer are are an to industry. it's digital us like increasingly and deliver Vistar going folks for CPM our who enable plugged to be buyers.

So that's come and it's there, the as essentially on going fore. data more providers to what's out increasing third-party

Operator

our Vitanza We'll from TD next Lance question Cowen. take from

Lance Vitanza

going the a the Gulf wondering evenly drag was the in to What's on Coast of quarter? more end you called Was or there? on at You thoughts that the out pronounced was back seeing Any either results. if or are fourth I'm come beginning it as And less why? quarter? distributed? the weakness

Sean Reilly

you'll and its have Every as again, as going the is now region not economies elsewhere. aren't robust local what's and catching maybe just breath, a that on

So Alabama, is Mississippi, into Arkansas, Coast for us, they'll and things softer think don't a the might there's Coast bit Louisiana, Gulf Gulf back. And essentially region. just really. that the it's basic be anything been come to just have I It's there, little read

Jay Johnson

add, also I'd last broader portfolio. of in year, the Gulf Lance, the Coast outperformed QX that

So a of a little a headwind bit company. from there year-over-year

Sean Reilly

they in of Yes, comp a the tougher had places. other some

Lance Vitanza

the outlook a on seeing kind just people it this of internal the it Or then really beginning you're function take to M&A And to buying -- by driving come Or outlook, -- just was pause? that of Is driven Is a just you rates more it the in to picking down? could improving wondering interest little economy? trend? stabilized having the you. decisions Got more bit is why up? for real about a talk your what's -- well, it

Sean Reilly

then its say, or lot of sort give keep interest to So look, down internally little in that. well. activity have terms I cycle. activity to decades. a entrepreneurs then just We them when that, a they the rate either us, a talk for bit think is your generated. been of our mind, of other we then of point, couple that is bit catch decides start a rates in come when up. when family, a picks call, operations decide certainly us breadth, some checkbook Lamar right? And And different is some is sell, in open, And to falling, of of interest are we're These it to M&A around slows as of little it were everybody Lance, and There mom-and-pop a they just, know

for make So I think year year. next those an X active things will

Lance Vitanza

mentioned transaction, potentially you or couple Adams what a times, would And consider of a tuck-ins? an tuck-ins those about you you would consider but something -- like Link, or larger a

Sean Reilly

tuck-in obviously acquisition Well there's sort those in day in, going of those. of more guys engage activity both in. do. don't control of measure day certainly, what a are tuck-in that's out than We things That's that event-driven of to we those one

be So yes, that sort would of stay tuned. a

Operator

in program questions further will closing the no to for remarks. over have back turn Reilly we Sean I queue. And the

Sean Reilly

look Thank thank again all your we in to and Well, with we you talking interest you Whitney, XXXX. forward page for as thank and turn all. you, the you into Lamar,

Operator

program. today's Thank participation. conclude does you your for This

time, You wonderful at and may any disconnect day. a have

Lamar Advertising (LAMR) 8 Nov 242024 Q3 Earnings call transcript