Lamar(US:LAMR)2026-02-20 15:00Financial Data and Key Metrics Changes - The company ended Q4 2025 with diluted AFFO per share increasing 1.4% to $2.24 compared to $2.21 in Q4 2024 [9] - Full-year AFFO guidance is projected to be between $8.50 and $8.70 per share, reflecting a year-over-year growth of 4.1% at the midpoint [4][14] - Adjusted EBITDA for Q4 was $288.9 million, an increase of 3.7% from $278.5 million in Q4 2024 [9] Business Line Data and Key Metrics Changes - Local revenue increased by 1.7% while national programmatic revenue grew by 3.3% in Q4, marking the third consecutive quarter of growth for national [5] - Digital revenue on a same-store basis increased by 3.7% in Q4, with digital billboards representing 33.7% of total business [18][19] - The company added 111 digital units in Q4, ending the year with 5,553 operating units [5][19] Market Data and Key Metrics Changes - The Atlantic and Southwest regions showed relative strength in Q4, while the Northeast region exhibited weakness [18] - Political advertising was a headwind in Q4, down about $11 million compared to 2024, but is expected to reverse in 2026 [5][56] Company Strategy and Development Direction - The company plans to remain aggressive in digital deployments, targeting a similar number of internal digital deployments as last year [6] - The integration of acquired assets, including the Verde deal, is progressing well, with expectations for another active M&A year in 2026 [6][14] - The company has an investment capacity exceeding $1 billion while maintaining a target leverage range of 3.5-4 times net debt to EBITDA [14] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the advertising climate for 2026, citing political tailwinds and increased spending around World Cup venues [27] - The company anticipates a conservative growth pace in Q1, with expectations for momentum to build throughout the year [38] - Management highlighted the positive impact of changes in FDA rules on pharmaceutical advertising, which could enhance revenue from this vertical [51] Other Important Information - The company plans to declare a regular cash dividend of $1.60 per share for Q1, with an expected total of $6.40 per share for 2026 [17] - Total consolidated debt stands at approximately $3.4 billion, with a weighted average interest rate of 4.5% [13] Q&A Session Summary Question: What is the state of the macro U.S. ad market as we enter 2026? - Management expects to maintain acquisition spending close to $200 million, with a positive ad spend climate anticipated for 2026 [26][27] Question: What are the implications of Clear Channel's acquisition for Lamar? - Management does not foresee significant changes in the industry structure and believes Clear Channel may not need to sell assets to deleverage [31][32] Question: How should acquisition-adjusted growth be viewed for Q1? - Management indicated that Q1 growth may be slightly below guidance but expects momentum to increase as the year progresses [38] Question: What are the expectations for local versus national growth and the impact of the World Cup? - Management anticipates $3 million-$4 million in incremental World Cup business, with positive trends in national advertising [42] Question: What is the expected benefit from political advertising in 2026? - Management estimates a conservative increase of around $12 million to $14 million in political advertising revenue compared to the previous year [56]