Lamar Advertising Company
) reported its financial results for the third quarter 2012 on
November 7. Earnings per share stood at 12 cents compared with 4
cents earned in the year-ago quarter. Third quarter results;
however, failed to meet the Zacks Consensus Estimate of 14 cents
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LAMAR ADVER CO (LAMR): Free Stock Analysis
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Pro forma net revenue jumped 2.0% year over year to $306.3
million in the quarter and registered a reported growth of 3.2%.
The results were slightly above management's revenue guidance
range of $303-$306 million and pro forma growth forecast of 1% to
Direct advertising and G&A expenses in the quarter were
$154.0 million, down 0.7% year over year on a pro forma basis. As
reported, operating income modestly increased 14.6% year over
year to $63.5 million.
Interest expense dipped 9.4% year over year to $38.5 million in
the quarter due to a lower debt level. Adjusted EBITDA stood at
$140.6 million, up roughly 6.0% year over year.
Exiting the third quarter, Lamar Advertising's cash and cash
equivalents plummeted from $98.9 million in the previous quarter
to $38.4 million in the third quarter. Total debt, including
current maturities also went down to $2,075.6 million from
$2,189.7 million in the previous quarter.
In the third quarter 2012, cash flow from operating activities
was approximately $119.3 million, up 6.3% year over year. Capital
spending totaled $28.2 million, slightly below $28.5 million
expended a year-ago. Of the total spending in the quarter,
roughly 64.5% was invested in upgrading the company's billboards
business while the rest was spent for logo, transit, land and
buildings, and operating equipment businesses.
Free cash flow was $77.7 million, up from $66.0 million in the
For the fourth quarter of 2012, management expects net revenue to
be within the $298-$301 million range and up roughly 2% to 3% on
a pro forma basis. This guidance excludes possible revenue
contribution from the acquisition of NextMedia Outdoor Inc. by
Lamar media Corp.
Lamar Advertising Company is one of the largest owners and
operators of outdoor advertising structures in the U.S. It
provides advertising services to restaurants, retailers,
automotive, real estate, health care, gaming, service, hotel and
motel, telecommunication, and amusement industries, including
entertainments and sports. However, the company should remain
wary of stiff competition from
Clear Channel Outdoor Holdings Inc.
) that recently reported earnings per share of 5 cents, much
above the Zacks Consensus Estimate of a loss per share of 4
We currently maintain a neutral recommendation on Lamar. The
stock also bears a Zacks #3 Rank, implying a short-term Hold