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): August 5, 2010
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 August 5, 2010, Lamar Advertising Company announced via press release its results for the
quarter ended June 30, 2010. 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 August 5, 2010, reporting Lamar’s
financial results for the quarter ended June 30, 2010. |
|||
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: August 5, 2010 | 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 August 5, 2010, reporting Lamar’s
financial results for the quarter ended June 30, 2010. |
|||
Exhibit 99.1
5551 Corporate Boulevard
Baton Rouge, LA 70808
Baton Rouge, LA 70808
Lamar Advertising Company Announces
Second Quarter 2010 Operating Results
Second Quarter 2010 Operating Results
Baton Rouge, LA – August 5, 2010 — 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 second quarter ended June 30, 2010.
Three Months Results
Lamar reported net revenues of $286.4 million for the second quarter of 2010 versus $274.7 million
for the second quarter of 2009, a 4.2% increase. Operating income for the second quarter of 2010
was $49.3 million as compared to $34.0 million for the same period in 2009. The Company also
recorded an expense of $17.1 million related to the loss on early extinguishment of debt resulting
from the refinancing of its senior credit facility and the repurchase of all outstanding 7
1/4% Senior Subordinated Notes due 2013, of which $12.3 million is a non-cash charge attributable
to the write off of unamortized debt issuance fees. The 7 1/4% Notes were repurchased pursuant to
a tender offer and subsequent redemption, both of which were funded by proceeds from the issuance
in April 2010 of $400 million 7 7/8% Senior Subordinated Notes due 2018. There was a net loss of
$8.9 million for the second quarter of 2010 compared to a net loss of $11.8 million for the second
quarter of 2009.
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 loss at the end of this release) for the second quarter of 2010 was $131.0 million versus
$121.5 million for the second quarter of 2009, a 7.9% increase.
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
second quarter of 2010 was $80.7 million as compared to $62.8 million for the same period in 2009,
a 28.4% increase.
Pro forma net revenue for the second quarter of 2010 increased 3.7% and pro forma EBITDA increased
7.7% as compared to the second quarter of 2009. Pro forma net revenue and EBITDA include
adjustments to the 2009 period for acquisitions and divestitures for the same time frame as
actually owned in the 2010 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.
Six Months Results
Lamar reported net revenues of $530.5 million for the six months ended June 30, 2010 versus $522.0
million for the same period in 2009, a 1.6% increase. Operating income for the six months ended
June 30, 2010 was $60.1 million as compared to $37.9 million for the same period in 2009. EBITDA
for the six months ended June 30, 2010 was $221.8 million versus $212.0 million for the same period
in 2009. There was a net loss of $33.8 million for the six months ended June 30, 2010 as compared
to a net loss of $33.6 million for the same period in 2009.
Free Cash Flow for the six months ended June 30, 2010 increased 8.7% to $117.1 million as compared
to $107.7 million for the same period in 2009.
Liquidity
As of June 30, 2010, Lamar had $190.0 million in total liquidity that consists of $163.1 million
available for borrowing under its revolving senior credit facility and approximately $26.9 million
in cash and cash equivalents. Currently, Lamar has approximately $208.0 million available for
borrowing under its revolving senior credit facility, as a result of principal payments made under
its revolving credit facility since June 30, 2010.
Guidance
For the third quarter of 2010 the Company expects net revenue to be approximately $284.0 million.
On a pro forma basis this represents an increase of approximately 4.0%.
Forward Looking Statements
This press release contains forward-looking statements, including the statements regarding guidance
for the third quarter of 2010. 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.
Conference Call Information
A conference call will be held to discuss the Company’s operating results on Thursday, August 5,
2010 at 10:00a.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:
|
93244770 | |
| Available through Monday, August 9, 2010 at 11:59 p.m. eastern time. | ||
Live Webcast:
|
www.lamar.com | |
Webcast Replay:
|
www.lamar.com | |
| Available through Monday, August 9, 2010 at 11:59 p.m. eastern time. | ||
Company Contact:
|
Keith A. Istre | |
| Chief Financial Officer | ||
| (225) 926-1000 | ||
| KI@lamar.com |
General Information
Lamar Advertising Company is a leading outdoor advertising company currently operating over
150 outdoor advertising companies in 44 states, Canada and Puerto Rico, logo businesses in 21
states and the province of Ontario, Canada and over 60 transit advertising franchises in the United
States, Canada and Puerto Rico.
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 | Six months ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
Net revenues |
$ | 286,366 | $ | 274,736 | $ | 530,469 | $ | 521,984 | ||||||||
Operating expenses (income) |
||||||||||||||||
Direct advertising expenses |
99,825 | 99,444 | 198,377 | 200,425 | ||||||||||||
General and administrative expenses |
45,608 | 44,283 | 90,368 | 89,660 | ||||||||||||
Corporate expenses |
9,904 | 9,539 | 19,926 | 19,860 | ||||||||||||
Non-cash compensation |
5,039 | 5,236 | 7,800 | 6,741 | ||||||||||||
Depreciation and amortization |
78,165 | 83,489 | 156,507 | 169,263 | ||||||||||||
Gain on disposition of assets |
(1,446 | ) | (1,221 | ) | (2,619 | ) | (1,873 | ) | ||||||||
| 237,095 | 240,770 | 470,359 | 484,076 | |||||||||||||
Operating income |
49,271 | 33,966 | 60,110 | 37,908 | ||||||||||||
Other expense (income) |
||||||||||||||||
Loss (gain) on extinguishment of debt |
17,137 | (3,539 | ) | 17,398 | (3,539 | ) | ||||||||||
Interest income |
(87 | ) | (169 | ) | (176 | ) | (314 | ) | ||||||||
Interest expense |
46,640 | 56,645 | 95,970 | 92,995 | ||||||||||||
| 63,690 | 52,937 | 113,192 | 89,142 | |||||||||||||
Loss before income tax |
(14,419 | ) | (18,971 | ) | (53,082 | ) | (51,234 | ) | ||||||||
Income tax benefit |
(5,482 | ) | (7,134 | ) | (19,318 | ) | (17,659 | ) | ||||||||
Net loss |
(8,937 | ) | (11,837 | ) | (33,764 | ) | (33,575 | ) | ||||||||
Preferred stock dividends |
91 | 91 | 182 | 182 | ||||||||||||
Net loss applicable to common stock |
$ | (9,028 | ) | $ | (11,928 | ) | $ | (33,946 | ) | $ | (33,757 | ) | ||||
Earnings per share: |
||||||||||||||||
Basic loss per share |
$ | (0.10 | ) | $ | (0.13 | ) | $ | (0.37 | ) | $ | (0.37 | ) | ||||
Diluted loss per share |
$ | (0.10 | ) | $ | (0.13 | ) | $ | (0.37 | ) | $ | (0.37 | ) | ||||
Weighted average common shares
outstanding: |
||||||||||||||||
- basic |
92,202,404 | 91,686,753 | 92,115,868 | 91,633,232 | ||||||||||||
- diluted |
92,714,870 | 91,746,773 | 92,627,203 | 91,787,134 | ||||||||||||
OTHER DATA |
||||||||||||||||
Free Cash Flow Computation: |
||||||||||||||||
EBITDA |
$ | 131,029 | $ | 121,470 | $ | 221,798 | $ | 212,039 | ||||||||
Interest, net |
(42,460 | ) | (46,373 | ) | (87,752 | ) | (81,296 | ) | ||||||||
Current tax expense |
(477 | ) | (759 | ) | (1,088 | ) | (1,377 | ) | ||||||||
Preferred stock dividends |
(91 | ) | (91 | ) | (182 | ) | (182 | ) | ||||||||
Total capital expenditures (1) |
(7,347 | ) | (11,413 | ) | (15,688 | ) | 21,471 | ) | ||||||||
Free cash flow |
$ | 80,654 | $ | 62,834 | $ | 117,088 | $ | 107,713 | ||||||||
| (1) | See the capital expenditures detail included below for a breakdown by category. |
| June 30, | December 31, | |||||||
| 2010 | 2009 | |||||||
Selected Balance Sheet Data: |
||||||||
Cash and cash equivalents |
$ | 26,876 | $ | 112,253 | ||||
Working capital |
166,362 | 104,229 | ||||||
Total assets |
3,781,153 | 3,943,541 | ||||||
Total debt (including current maturities) |
2,546,967 | 2,674,912 | ||||||
Total stockholders’ equity |
807,375 | 831,798 | ||||||
| Three months ended | Six months ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
Other Data: |
||||||||||||||||
Cash flows provided by operating activities |
$ | 85,519 | $ | 97,050 | $ | 93,170 | $ | 116,411 | ||||||||
Cash flows used in investing activities |
5,077 | 10,197 | 13,119 | 13,785 | ||||||||||||
Cash flows (used in) provided by financing activities |
(86,468 | ) | (123,294 | ) | (165,599 | ) | 40,641 | |||||||||
Reconciliation of Free Cash Flow to Cash Flows Provided by
Operating Activities: |
||||||||||||||||
Cash flows provided by operating activities |
$ | 85,519 | $ | 97,050 | $ | 93,170 | $ | 116,411 | ||||||||
Changes in operating assets and liabilities |
4,341 | (19,591 | ) | 43,567 | 18,450 | |||||||||||
Total capital expenditures |
(7,347 | ) | (11,413 | ) | (15,688 | ) | (21,471 | ) | ||||||||
Preferred stock dividends |
(91 | ) | (91 | ) | (182 | ) | (182 | ) | ||||||||
Other |
(1,768 | ) | (3,121 | ) | (3,779 | ) | (5,495 | ) | ||||||||
Free cash flow |
$ | 80,654 | $ | 62,834 | $ | 117,088 | $ | 107,713 | ||||||||
Reconciliation of EBITDA to Net loss: |
||||||||||||||||
EBITDA |
$ | 131,029 | $ | 121,470 | $ | 221,798 | $ | 212,039 | ||||||||
Less: |
||||||||||||||||
Non-cash compensation |
5,039 | 5,236 | 7,800 | 6,741 | ||||||||||||
Depreciation and amortization |
78,165 | 83,489 | 156,507 | 169,263 | ||||||||||||
Gain on disposition of assets |
(1,446 | ) | (1,221 | ) | (2,619 | ) | (1,873 | ) | ||||||||
Operating Income |
49,271 | 33,966 | 60,110 | 37,908 | ||||||||||||
Less: |
||||||||||||||||
Interest income |
(87 | ) | (169 | ) | (176 | ) | (314 | ) | ||||||||
Loss (gain) on extinguishment of debt |
17,137 | (3,539 | ) | 17,398 | (3,539 | ) | ||||||||||
Interest expense |
46,640 | 56,645 | 95,970 | 92,995 | ||||||||||||
Income tax benefit |
(5,482 | ) | (7,134 | ) | (19,318 | ) | (17,659 | ) | ||||||||
Net loss |
$ | (8,937 | ) | $ | (11,837 | ) | $ | (33,764 | ) | $ | (33,575 | ) | ||||
| Three months ended | ||||||||||||
| June 30, | ||||||||||||
| 2010 | 2009 | % Change | ||||||||||
Reconciliation of Reported Basis to Pro Forma (a) Basis: |
||||||||||||
Reported net revenue |
$ | 286,366 | $ | 274,736 | 4.2 | % | ||||||
Acquisitions and divestitures |
— | 1,295 | ||||||||||
Pro forma net revenue |
$ | 286,366 | $ | 276,031 | 3.7 | % | ||||||
Reported direct advertising and G&A expenses |
$ | 145,433 | $ | 143,727 | 1.2 | % | ||||||
Acquisitions and divestitures |
— | 1,066 | ||||||||||
Pro forma direct advertising and G&A expenses |
$ | 145,433 | $ | 144,793 | 0.4 | % | ||||||
Reported outdoor operating income |
$ | 140,933 | $ | 131,009 | 7.6 | % | ||||||
Acquisitions and divestitures |
— | 229 | ||||||||||
Pro forma outdoor operating income |
$ | 140,933 | $ | 131,238 | 7.4 | % | ||||||
Reported corporate expenses |
$ | 9,904 | $ | 9,539 | 3.8 | % | ||||||
Acquisitions and divestitures |
— | — | ||||||||||
Pro forma corporate expenses |
$ | 9,904 | $ | 9,539 | 3.8 | % | ||||||
Reported EBITDA |
$ | 131,029 | $ | 121,470 | 7.9 | % | ||||||
Acquisitions and divestitures |
— | 229 | ||||||||||
Pro forma EBITDA |
$ | 131,029 | $ | 121,699 | 7.7 | % | ||||||
| (a) | Pro forma net revenues, direct advertising and general and administrative expenses, outdoor operating income, corporate expenses and EBITDA include adjustments to 2009 for acquisitions and divestitures for the same time frame as actually owned in 2010. |
| Three months ended | ||||||||
| June 30, | ||||||||
| 2010 | 2009 | |||||||
Reconciliation of Outdoor Operating Income to Operating Income: |
||||||||
Outdoor operating income |
$ | 140,933 | $ | 131,009 | ||||
Less: Corporate expenses |
9,904 | 9,539 | ||||||
Non-cash compensation |
5,039 | 5,236 | ||||||
Depreciation and amortization |
78,165 | 83,489 | ||||||
Plus: Gain on disposition of assets |
1,446 | 1,221 | ||||||
Operating income |
$ | 49,271 | $ | 33,966 | ||||
| Three months ended | Six months ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
Capital expenditure detail by category |
||||||||||||||||
Billboards — traditional |
$ | 873 | $ | 2,217 | $ | 2,509 | $ | 5,061 | ||||||||
Billboards — digital |
2,937 | 3,929 | 4,670 | 8,247 | ||||||||||||
Logo |
1,981 | 1,409 | 4,068 | 2,071 | ||||||||||||
Transit |
38 | 2,022 | 674 | 3,010 | ||||||||||||
Land and buildings |
— | — | 579 | 384 | ||||||||||||
Operating equipment |
1,518 | 1,836 | 3,188 | 2,698 | ||||||||||||
Total capital expenditures |
$ | 7,347 | $ | 11,413 | $ | 15,688 | $ | 21,471 | ||||||||