UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 26, 2009
LAMAR ADVERTISING COMPANY
(Exact name of registrant as specified in its charter)
| Delaware | 0-30242 | 72-1449411 | ||
| (State or other jurisdiction | (Commission File | (IRS Employer | ||
| of incorporation) | Number) | Identification No.) |
5551 Corporate Boulevard, Baton Rouge, Louisiana 70808
(Address of principal executive offices and zip code)
(Address of principal executive offices and zip code)
(225) 926-1000
(Registrant’s telephone number, including area code)
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
| o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On February 26, 2009, Lamar Advertising Company announced via press release its results for the
quarter and year ended December 31, 2008. A copy of Lamar’s press release is hereby furnished to
the Commission and incorporated by reference herein as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
| Exhibit | ||
| No. | Description | |
99.1
|
Press Release of Lamar Advertising Company, dated February 26, 2009, reporting Lamar’s financial results for the quarter and year ended December 31, 2008. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: February 26, 2009 | LAMAR ADVERTISING COMPANY |
|||
| By: | /s/ Keith A. Istre | |||
| Keith A. Istre | ||||
| Treasurer and Chief Financial Officer | ||||
EXHIBIT INDEX
| Exhibit | ||
| No. | Description | |
99.1
|
Press Release of Lamar Advertising Company, dated February 26, 2009, reporting Lamar’s financial results for the quarter and year ended December 31, 2008. |
Exhibit 99.1
5551 Corporate Boulevard
Baton Rouge, LA 70808
Baton Rouge, LA 70808
Lamar Advertising Company Announces
Fourth Quarter and Year End 2008 Operating Results
Fourth Quarter and Year End 2008 Operating Results
Baton Rouge, LA — Thursday, February 26, 2009 — Lamar Advertising Company (Nasdaq: LAMR), a
leading owner and operator of outdoor advertising and logo sign displays, announces the Company’s
operating results for the fourth quarter and the year ended December 31, 2008.
Fourth Quarter Results
Lamar reported net revenues of $279.3 million for the fourth quarter of 2008 versus $304.9 million for the fourth quarter of 2007, an 8.4% decrease. Operating income for the fourth quarter of 2008 was $23.8 million as compared to $51.3 million for the same period in 2007. There was a net loss of $6.8 million for the fourth quarter of 2008 compared to net earnings of $4.5 million for the fourth quarter of 2007.
Lamar reported net revenues of $279.3 million for the fourth quarter of 2008 versus $304.9 million for the fourth quarter of 2007, an 8.4% decrease. Operating income for the fourth quarter of 2008 was $23.8 million as compared to $51.3 million for the same period in 2007. There was a net loss of $6.8 million for the fourth quarter of 2008 compared to net earnings of $4.5 million for the fourth quarter of 2007.
Adjusted EBITDA, which we refer to herein as EBITDA (defined as operating income before
non-cash compensation, depreciation and amortization and gain on disposition of assets — see
reconciliation to net income at the end of this release), for the fourth quarter of 2008 was $114.4
million versus $141.6 million for the fourth quarter of 2007, a 19.2% decrease.
Free cash flow (defined as EBITDA less interest, net of interest income and amortization of
financing costs, current taxes, preferred stock dividends and total capital expenditures — see
reconciliation to cash flows provided by operating activities at the end of this release) for the
fourth quarter of 2008 was $52.2 million as compared to $41.4 million for the same period in 2007,
a 26.1% increase.
Pro forma net revenue for the fourth quarter of 2008 decreased 11.7% and pro forma EBITDA decreased
20.4% as compared to the fourth quarter of 2007. Pro forma net revenue and EBITDA include
adjustments to the 2007 period for acquisitions and divestitures for the same time frame as
actually owned in the 2008 period. Tables that reconcile reported results to pro forma results and
operating income to outdoor operating income are included at the end of this release.
Twelve Months Results
Lamar reported net revenues of $1.20 billion for the twelve months ended December 31, 2008 versus $1.21 billion for the same period in 2007, a 0.9% decrease. Operating income for the twelve months ended December 31, 2008 was $180.0 million as compared to $227.8 million for the same period in 2007. EBITDA decreased 8.1% to $513.2 million for the twelve months ended December 31, 2008 versus $558.3 million for the same period in 2007. There was net income of $9.7 million for the twelve months ended December 31, 2008 as compared to net income of $46.2 million for the same period in 2007.
Lamar reported net revenues of $1.20 billion for the twelve months ended December 31, 2008 versus $1.21 billion for the same period in 2007, a 0.9% decrease. Operating income for the twelve months ended December 31, 2008 was $180.0 million as compared to $227.8 million for the same period in 2007. EBITDA decreased 8.1% to $513.2 million for the twelve months ended December 31, 2008 versus $558.3 million for the same period in 2007. There was net income of $9.7 million for the twelve months ended December 31, 2008 as compared to net income of $46.2 million for the same period in 2007.
Free Cash Flow for the twelve months ended December 31, 2008 was $172.4 million as compared to
$152.1 million for the same period in 2007, a 13.3% increase.
Stock Repurchase Program
During the quarter ended December 31, 2008, the Company did not make any repurchases of its Class A common stock under its stock repurchase program. As of December 31, 2008, the Company had approximately $127 million of authorized repurchase capacity remaining under its repurchase program. The program expired in February 2009 with no repurchases occurring in 2009. Share repurchases under the program were made on the open market or in privately negotiated transactions. The timing and amount of all shares repurchased was determined by Lamar’s management based on its evaluation of market conditions and other factors. All repurchased shares are available for future use for general corporate and other purposes.
During the quarter ended December 31, 2008, the Company did not make any repurchases of its Class A common stock under its stock repurchase program. As of December 31, 2008, the Company had approximately $127 million of authorized repurchase capacity remaining under its repurchase program. The program expired in February 2009 with no repurchases occurring in 2009. Share repurchases under the program were made on the open market or in privately negotiated transactions. The timing and amount of all shares repurchased was determined by Lamar’s management based on its evaluation of market conditions and other factors. All repurchased shares are available for future use for general corporate and other purposes.
Guidance
For the first quarter of 2009 the Company expects net revenue to be approximately $246.0 million. On a pro forma basis this represents a decrease of approximately 15% over the same period in 2008. As we have reported previously, management began taking steps in the fourth quarter to significantly reduce expenditures in several areas including operating expenses, capital expenditures and acquisitions. The Company expects to generate free cash flow in 2009 by continuing these measures and intends to use the funds generated by these actions to reduce existing indebtedness.
For the first quarter of 2009 the Company expects net revenue to be approximately $246.0 million. On a pro forma basis this represents a decrease of approximately 15% over the same period in 2008. As we have reported previously, management began taking steps in the fourth quarter to significantly reduce expenditures in several areas including operating expenses, capital expenditures and acquisitions. The Company expects to generate free cash flow in 2009 by continuing these measures and intends to use the funds generated by these actions to reduce existing indebtedness.
Forward Looking Statements
This press release contains forward-looking statements, including the statements regarding guidance for the first quarter of 2009 and the Company’s ongoing stock repurchase plan. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward-looking statements. These risks and uncertainties include, among others, (1) our significant indebtedness; (2) the length and severity of the current recession and the effect that it has on the demand for advertising; (3) the continued popularity of outdoor advertising as an advertising medium; (4) our need for and ability to obtain additional funding for operations, debt refinancing or acquisitions; (5) the regulation of the outdoor advertising industry; (6) the integration of companies that we acquire and our ability to recognize cost savings or operating efficiencies as a result of these acquisitions; (7) the market for our Class A common stock and (8) other factors described in the reports on Forms 10-K and 10-Q and the registration statements that we file from time to time with the SEC. We caution investors not to place undue reliance on the forward-looking statements contained in this document. These statements speak only as of the date of this document, and we undertake no obligation to update or revise the statements, except as may be required by law.
This press release contains forward-looking statements, including the statements regarding guidance for the first quarter of 2009 and the Company’s ongoing stock repurchase plan. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward-looking statements. These risks and uncertainties include, among others, (1) our significant indebtedness; (2) the length and severity of the current recession and the effect that it has on the demand for advertising; (3) the continued popularity of outdoor advertising as an advertising medium; (4) our need for and ability to obtain additional funding for operations, debt refinancing or acquisitions; (5) the regulation of the outdoor advertising industry; (6) the integration of companies that we acquire and our ability to recognize cost savings or operating efficiencies as a result of these acquisitions; (7) the market for our Class A common stock and (8) other factors described in the reports on Forms 10-K and 10-Q and the registration statements that we file from time to time with the SEC. We caution investors not to place undue reliance on the forward-looking statements contained in this document. These statements speak only as of the date of this document, and we undertake no obligation to update or revise the statements, except as may be required by law.
Use of Non-GAAP Measures
EBITDA, free cash flow, pro forma results and outdoor operating income are not measures of performance under accounting principles generally accepted in the United States of America (“GAAP”) and should not be considered alternatives to operating income, net loss, cash flows from operating activities, or other GAAP figures as indicators of the Company’s financial performance or liquidity. The Company’s management believes that EBITDA, free cash flow, pro forma results and outdoor operating income are useful in evaluating the Company’s performance and provide investors and financial analysts a better understanding of the Company’s core operating results. The pro forma acquisition adjustments are intended to provide information that may be useful for investors when assessing period to period results. Our presentations of these measures may not be comparable to similarly titled measures used by other companies. Reconciliations of these measures to GAAP are included at the end of this release.
EBITDA, free cash flow, pro forma results and outdoor operating income are not measures of performance under accounting principles generally accepted in the United States of America (“GAAP”) and should not be considered alternatives to operating income, net loss, cash flows from operating activities, or other GAAP figures as indicators of the Company’s financial performance or liquidity. The Company’s management believes that EBITDA, free cash flow, pro forma results and outdoor operating income are useful in evaluating the Company’s performance and provide investors and financial analysts a better understanding of the Company’s core operating results. The pro forma acquisition adjustments are intended to provide information that may be useful for investors when assessing period to period results. Our presentations of these measures may not be comparable to similarly titled measures used by other companies. Reconciliations of these measures to GAAP are included at the end of this release.
Conference Call Information
A conference call will be held to discuss the Company’s operating results Thursday, February 26, 2009 at 10:00 a.m. central time. Instructions for the conference call and Webcast are provided below:
A conference call will be held to discuss the Company’s operating results Thursday, February 26, 2009 at 10:00 a.m. central time. Instructions for the conference call and Webcast are provided below:
Conference Call
All Callers:
|
1-334-323-0520 or 1-334-323-9871 | |
Passcode:
|
Lamar | |
Replay:
|
1-334-323-7226 | |
Passcode:
|
78537190 | |
| Available through Monday, March 2, 2009 at 11:59 p.m. eastern time | ||
Live Webcast:
|
www.lamar.com | |
Webcast Replay:
|
www.lamar.com | |
| Available through Monday, March 2, 2009 at 11:59 p.m. eastern time |
General Information on Lamar
Lamar Advertising Company is a leading outdoor advertising company currently operating over 150 outdoor advertising companies in 44 states and Puerto Rico, logo businesses in 19 states and the province of Ontario, Canada and approximately 66 transit advertising franchises in the United States, Canada and Puerto Rico.
Lamar Advertising Company is a leading outdoor advertising company currently operating over 150 outdoor advertising companies in 44 states and Puerto Rico, logo businesses in 19 states and the province of Ontario, Canada and approximately 66 transit advertising franchises in the United States, Canada and Puerto Rico.
Company Contact:
|
Keith A. Istre | |
| Chief Financial Officer | ||
| (225) 926-1000 | ||
| KI@lamar.com |
LAMAR ADVERTISING COMPANY AND
SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
| Three months ended | Twelve months ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
Net revenues |
$ | 279,308 | $ | 304,892 | $ | 1,198,419 | $ | 1,209,555 | ||||||||
Operating expenses (income) |
||||||||||||||||
Direct advertising expenses |
107,987 | 102,724 | 436,556 | 408,397 | ||||||||||||
General and administrative expenses |
47,207 | 49,247 | 199,420 | 196,633 | ||||||||||||
Corporate expenses |
9,694 | 11,277 | 49,196 | 46,269 | ||||||||||||
Non-cash compensation |
(42 | ) | 5,734 | 9,005 | 27,488 | |||||||||||
Depreciation and amortization |
94,172 | 86,059 | 331,654 | 306,879 | ||||||||||||
Gain on disposition of assets |
(3,483 | ) | (1,408 | ) | (7,363 | ) | (3,914 | ) | ||||||||
| 255,535 | 253,633 | 1,018,468 | 981,752 | |||||||||||||
Operating income |
23,773 | 51,259 | 179,951 | 227,803 | ||||||||||||
Other expense (income) |
||||||||||||||||
Gain on disposition of investment |
— | — | (1,814 | ) | (15,448 | ) | ||||||||||
Interest income |
(205 | ) | (1,552 | ) | (1,202 | ) | (2,598 | ) | ||||||||
Interest expense |
39,605 | 44,773 | 159,158 | 162,447 | ||||||||||||
| 39,400 | 43,221 | 156,142 | 144,401 | |||||||||||||
(Loss) income before income tax expense |
(15,627 | ) | 8,038 | 23,809 | 83,402 | |||||||||||
Income tax (benefit) expense |
(8,790 | ) | 3,565 | 14,086 | 37,185 | |||||||||||
Net (loss) income |
(6,837 | ) | 4,473 | 9,723 | 46,217 | |||||||||||
Preferred stock dividends |
92 | 92 | 365 | 365 | ||||||||||||
Net (loss) income applicable to common stock |
$ | (6,929 | ) | $ | 4,381 | $ | 9,358 | $ | 45,852 | |||||||
Earnings per share: |
||||||||||||||||
Basic (loss) earnings per share |
$ | (0.08 | ) | $ | 0.05 | $ | 0.10 | $ | 0.47 | |||||||
Diluted (loss) earnings per share |
$ | (0.08 | ) | $ | 0.05 | $ | 0.10 | $ | 0.47 | |||||||
Cash dividends declared per share of common stock |
$ | — | $ | — | $ | — | $ | 3.25 | ||||||||
Weighted average common shares outstanding: |
||||||||||||||||
- basic |
91,513,304 | 94,114,619 | 92,125,660 | 96,779,009 | ||||||||||||
- diluted |
91,667,315 | 94,822,323 | 92,306,840 | 97,553,907 | ||||||||||||
OTHER DATA |
||||||||||||||||
Free Cash Flow Computation: |
||||||||||||||||
EBITDA |
$ | 114,420 | $ | 141,644 | $ | 513,247 | $ | 558,256 | ||||||||
Interest, net |
(38,179 | ) | (41,974 | ) | (153,013 | ) | (155,262 | ) | ||||||||
Current tax benefit (expense) |
14,842 | (11,068 | ) | 10,589 | (29,984 | ) | ||||||||||
Preferred stock dividends |
(92 | ) | (92 | ) | (365 | ) | (365 | ) | ||||||||
Total capital expenditures (1) |
(38,824 | ) | (47,089 | ) | (198,070 | ) | (220,534 | ) | ||||||||
Free cash flow |
$ | 52,167 | $ | 41,421 | $ | 172,388 | $ | 152,111 | ||||||||
| (1) | See the capital expenditures detail included in this release for a breakdown by category. |
| December 31, | December 31, | |||||||
| 2008 | 2007 | |||||||
Selected Balance Sheet Data: |
||||||||
Cash and cash equivalents |
$ | 14,139 | $ | 76,048 | ||||
Working capital |
84,105 | 155,229 | ||||||
Total assets |
4,117,025 | 4,081,763 | ||||||
Total debt (including current maturities) |
2,836,358 | 2,725,770 | ||||||
Total stockholders’ equity |
860,251 | 931,007 | ||||||
| Three months ended | Twelve months ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
Other Data: |
||||||||||||||||
Cash flows provided by operating activities |
$ | 108,796 | $ | 108,865 | $ | 346,520 | $ | 354,469 | ||||||||
Cash flows used in investing activities |
61,582 | 91,770 | 437,419 | 341,081 | ||||||||||||
Cash flows (used in) provided by financing activities |
(53,808 | ) | 36,428 | 30,002 | 39,277 | |||||||||||
Reconciliation of Free Cash Flow to Cash Flows Provided by
Operating Activities: |
||||||||||||||||
Cash flows provided by operating activities |
$ | 108,796 | $ | 108,865 | $ | 346,520 | $ | 354,469 | ||||||||
Changes in operating assets and liabilities |
(11,392 | ) | (10,372 | ) | 38,668 | 24,637 | ||||||||||
Total capital expenditures |
(38,824 | ) | (47,089 | ) | (198,070 | ) | (220,534 | ) | ||||||||
Preferred stock dividends |
(92 | ) | (92 | ) | (365 | ) | (365 | ) | ||||||||
Other |
(6,321 | ) | (9,891 | ) | (14,365 | ) | (6,096 | ) | ||||||||
Free cash flow |
$ | 52,167 | $ | 41,421 | $ | 172,388 | $ | 152,111 | ||||||||
Reconciliation of EBITDA to Net income: |
||||||||||||||||
EBITDA |
$ | 114,420 | $ | 141,644 | $ | 513,247 | $ | 558,256 | ||||||||
Less: |
||||||||||||||||
Non-cash compensation |
(42 | ) | 5,734 | 9,005 | 27,488 | |||||||||||
Depreciation and amortization |
94,172 | 86,059 | 331,654 | 306,879 | ||||||||||||
Gain on disposition of assets |
(3,483 | ) | (1,408 | ) | (7,363 | ) | (3,914 | ) | ||||||||
Operating Income |
23,773 | 51,259 | 179,951 | 227,803 | ||||||||||||
Less: |
||||||||||||||||
Gain on disposition of investment |
— | — | (1,814 | ) | (15,448 | ) | ||||||||||
Interest income |
(205 | ) | (1,552 | ) | (1,202 | ) | (2,598 | ) | ||||||||
Interest expense |
39,605 | 44,773 | 159,158 | 162,447 | ||||||||||||
Income tax (benefit) expense |
(8,790 | ) | 3,565 | 14,086 | 37,185 | |||||||||||
Net (loss) income |
$ | (6,837 | ) | $ | 4,473 | $ | 9,723 | $ | 46,217 | |||||||
| Three months ended | ||||||||||||
| December 31, | ||||||||||||
| 2008 | 2007 | % Change | ||||||||||
Reconciliation of Reported Basis to Pro Forma (a) Basis: |
||||||||||||
Reported net revenue |
$ | 279,308 | $ | 304,892 | (8.4 | )% | ||||||
Acquisitions and divestitures |
— | 11,338 | ||||||||||
Pro forma net revenue |
$ | 279,308 | $ | 316,230 | (11.7 | )% | ||||||
Reported direct advertising and G&A expenses |
$ | 155,194 | $ | 151,971 | 2.1 | % | ||||||
Acquisitions and divestitures |
— | 9,228 | ||||||||||
Pro forma direct advertising and G&A expenses |
$ | 155,194 | $ | 161,199 | (3.7 | )% | ||||||
Reported outdoor operating income |
$ | 124,114 | $ | 152,921 | (18.8 | )% | ||||||
Acquisitions and divestitures |
— | 2,110 | ||||||||||
Pro forma outdoor operating income |
$ | 124,114 | $ | 155,031 | (19.9 | )% | ||||||
Reported Corporate expenses |
$ | 9,694 | $ | 11,277 | (14.0 | )% | ||||||
Acquisitions and divestitures |
— | — | ||||||||||
Pro forma Corporate expenses |
$ | 9,694 | $ | 11,277 | (14.0 | )% | ||||||
Reported EBITDA |
$ | 114,420 | $ | 141,644 | (19.2 | )% | ||||||
Acquisitions and divestitures |
— | 2,110 | ||||||||||
Pro forma EBITDA |
$ | 114,420 | $ | 143,754 | (20.4 | )% | ||||||
| (a) | Pro forma net revenues, direct advertising and general and administrative expenses, outdoor operating income, corporate expenses, and EBITDA include adjustments to 2007 for acquisitions and divestitures for the same time frame as actually owned in 2008. |
| Three months ended | ||||||||
| December 31, | ||||||||
| 2008 | 2007 | |||||||
Reconciliation of Outdoor Operating Income to Operating Income: |
||||||||
Outdoor Operating income |
$ | 124,114 | $ | 152,921 | ||||
Less: Corporate expenses |
(9,694 | ) | (11,277 | ) | ||||
Non-cash compensation |
42 | (5,734 | ) | |||||
Depreciation and amortization |
(94,172 | ) | (86,059 | ) | ||||
Plus: Gain on disposition of assets |
3,483 | 1,408 | ||||||
Operating income |
$ | 23,773 | $ | 51,259 | ||||
| Three months ended | Twelve months ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
Capital expenditure detail by category |
||||||||||||||||
Billboards — traditional |
$ | 8,605 | $ | 13,990 | $ | 58,064 | $ | 68,664 | ||||||||
Billboards — digital |
18,737 | 15,922 | 103,701 | 92,093 | ||||||||||||
Logo |
3,125 | 2,619 | 7,606 | 10,190 | ||||||||||||
Transit |
409 | 944 | 1,018 | 2,047 | ||||||||||||
Land and buildings |
3,294 | 9,039 | 11,240 | 31,463 | ||||||||||||
Operating equipment |
4,654 | 4,575 | 16,441 | 16,077 | ||||||||||||
Total capital expenditures |
$ | 38,824 | $ | 47,089 | $ | 198,070 | $ | 220,534 | ||||||||