Lamar(US:LAMR)2020-08-08 12:13Financial Data and Key Metrics Changes - The company revised its guidance for AFFO per share for the full year of 2020 to a range of $4.16 to $4.56, indicating a full-year revenue decline of approximately 13% to 14% [5] - Acquisition-adjusted revenue declined by 23.4% year-over-year, while adjusted EBITDA decreased by 35.9% to $133.2 million [13][14] - Fully diluted AFFO contracted by 38.3% to $0.95 per share [14] Business Line Data and Key Metrics Changes - Local sales outperformed national sales, with local revenue accounting for 81% of total sales, while national revenue represented 19% [15] - The company experienced a significant decline in revenue from national markets, which was nearly double that of local markets [15] Market Data and Key Metrics Changes - Small and middle markets continued to perform better than larger markets, with relative strength seen in sectors such as health care, education, insurance, real estate, and home improvement [7] - Weakness was noted in amusements, entertainment, sports, retail, and fine dining sectors [7][35] Company Strategy and Development Direction - The company is focusing on aligning its cost base to current conditions, targeting $50 million in expense savings, and is now expecting to achieve at least $60 million [9] - The company plans to resume digital deployments in 2021, with an initial target of approximately 300 new digital units [46] Management's Comments on Operating Environment and Future Outlook - Management noted a sequential improvement in contract pacing every month, with June showing stronger contract value than June 2019 [6] - The company expressed caution regarding uncertainties related to COVID-19 and its impact on back-to-school and sports events [8] Other Important Information - The company ended the quarter with total leverage of 4.15 times net debt-to-EBITDA, well below the covenant of 7 times [20] - The company has approximately $1.1 billion in liquidity, including cash on hand and available credit [21] Q&A Session Summary Question: Can you comment on the pacing of contract dollars between Q3 and Q4 in 2020? - Management indicated that contract pacing is showing sequential improvement, suggesting Q4 will benefit from contracts written in June, but customers remain cautious and are buying shorter-term [38] Question: Can you discuss pricing versus occupancy trends and how this disruption compares to the Great Recession? - Management believes they can hold pricing better than during the Great Recession, although larger markets are facing more pricing pressure compared to smaller markets [41][42] Question: How has Q3 started compared to Q2? - Management reported that sequentially, July is better than June, indicating a recovery trend despite the second surge of COVID-19 [50] Question: What verticals have seen recovery throughout Q2? - Management noted recovery in services, education, and regional casinos, while Las Vegas has faced challenges [53][54]