Lamar Advertising Company Announces Third Quarter 2013 Operating Results

Lamar Advertising Company Announces Third Quarter 2013 Operating Results

BATON ROUGE, La., Nov. 6, 2013 (GLOBE NEWSWIRE) -- 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 third quarter
ended September 30, 2013.

Three Months Results

Lamar reported net revenues of $323.2 million for the third quarter of 2013
versus $306.3 million for the third quarter of 2012, a 5.5% increase.
Operating income for the third quarter of 2013 was $69.3 million as compared
to $63.5 million for the same period in 2012. Lamar recognized $18.3 million
in net income for the third quarter of 2013 compared to net income of $11.5
million for the third quarter of 2012.

Adjusted 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 third quarter
of 2013 was $147.6 million versus $140.6 million for the third quarter of
2012, a 5.0% increase.

Free cash flow (defined as Adjusted 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 third
quarter of 2013 was $87.8 million as compared to $77.7 million for the same
period in 2012, a 13.0 % increase.

Pro forma net revenue for the third quarter of 2013 increased 2.1% and pro
forma Adjusted EBITDA increased 1.6% as compared to the third quarter of 2012.
Pro forma net revenue and Adjusted EBITDA include adjustments to the 2012
period for acquisitions and divestitures for the same time frame as actually
owned in the 2013 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.

Nine Months Results

Lamar reported net revenues of $931.3 million for the nine months ended
September 30, 2013 versus $877.4 million for the same period in 2012, a 6.1%
increase. Operating income for the nine months ended September 30, 2013 was
$165.5 million as compared to $153.8 million for the same period in 2012.
Adjusted EBITDA for the nine months ended September 30, 2013 was $406.0
million versus $378.6 million for the same period in 2012. There was net
income of $33.5 million for the nine months ended September 30, 2013 as
compared to net income of $2.6 million for the same period in 2012.

Free Cash Flow for the nine months ended September 30, 2013 increased 14.8% to
$224.5 million as compared to $195.6 million for the same period in 2012.

Liquidity

As of September 30, 2013, Lamar had $425.7 million in total liquidity that
consists of $243.0 million available for borrowing under its revolving senior
credit facility and approximately $182.7 million in cash and cash equivalents.

Senior Notes Redemption

As previously announced, the Company's wholly owned subsidiary, Lamar Media
Corp., intends to redeem in full all $350 million in aggregate principal
amount of its 9 3/4% Senior Notes due 2014 (the "Notes") on December 4, 2013
(the "Redemption Date") at a redemption price equal to 100% of the aggregate
principal amount of outstanding Notes plus a make whole amount and accrued and
unpaid interest to (but not including) the Redemption Date. The redemption
will be made in accordance with the terms of the indenture governing the
Notes.

This announcement is for informational purposes only and is not an offer to
purchase or a solicitation of an offer to purchase or sell with respect to the
Notes or any other securities.

Real Estate Investment Trust Update

As previously announced, Lamar is actively considering an election to real
estate investment trust (REIT) status and is currently evaluating the steps
necessary to implement conversion to a REIT. In conjunction with this review,
Lamar submitted a private letter ruling request to the U.S. Internal Revenue
Service (the "IRS") in November of 2012 regarding a potential REIT election.
Lamar has been advised by the IRS that its study of the current legal
standards it uses to define "real estate" for purposes of the REIT provisions
of the U.S. Internal Revenue Code is ongoing and that Lamar's private letter
ruling request remains under review. The timing of any response to Lamar's
ruling request is uncertain and may be delayed due to the ongoing IRS study.
Based on current information, Lamar has no reason to conclude that it will not
be in a position to convert to a REIT effective for the taxable year beginning
January 1, 2014. Lamar intends to complete a corporate restructuring to be in
compliance with REIT rules prior to December 31, 2013.

Lamar's decision to proceed with a REIT election is subject to the approval of
its board of directors. A favorable IRS ruling, if received, does not
guarantee that Lamar would succeed in qualifying as a REIT and there is no
certainty as to the timing of a REIT election. Lamar may not ultimately pursue
a conversion to a REIT, and it can provide no assurance that a REIT
conversion, if completed, will be successfully implemented or achieve the
intended benefits.

Guidance

For the fourth quarter of 2013 the Company expects net revenue to be
approximately $314 million to $317 million. On a pro forma basis this
represents an increase of approximately 0.5% to 1.5%.

Forward Looking Statements

This press release contains forward-looking statements, including the
statements regarding guidance for the fourth quarter of 2013; our
consideration of an election to real estate investment trust status; our
ability to complete the REIT conversion effective for the taxable year
beginning January 1, 2014; and our expected senior notes redemption. 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 state of the economy and financial markets
generally and the effect of the broader economy 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) our ability to qualify as a REIT, including
restructuring our operations to comply with applicable REIT rules; (6) the
regulation of the outdoor advertising industry; (7) the integration of
companies that we acquire and our ability to recognize cost savings or
operating efficiencies as a result of these acquisitions; and (8) the market
for our Class A common stock. For additional information regarding factors
that may cause actual results to differ materially from those indicated in our
forward-looking statements, we refer you to the risk factors included in Item
1A of our Annual Report on Form 10-K for the year ended December 31, 2012, as
supplemented by any risk factors contained in our Quarterly Reports on Form
10-Q. 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

Adjusted 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 income (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 Adjusted
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
Wednesday, November 6, 2013 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
Pass Code:      Lamar
               
Replay:         1-334-323-7226
Pass Code:      75659084
               Available through Wednesday, November 13, 2013 at 11:59 p.m.
                eastern time
               
Live Webcast:   www.lamar.com
               
Webcast Replay: www.lamar.com
               Available through Wednesday, November 13, 2013 at 11:59 p.m.
                eastern time

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 22 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)
                                                             
                            Three months ended    Nine months ended
                            September 30,         September 30,
                            2013       2012       2013          2012
                                                             
Net revenues                 $ 323,184  $ 306,286  $ 931,347     $ 877,396
                                                             
Operating expenses (income)                                   
Direct advertising expenses
(exclusive of depreciation   109,640    103,845    326,882       312,339
and amortization)
General and administrative
expenses (exclusive of       53,814     50,167     160,207       151,071
depreciation, amortization
and non-cash compensation)
Corporate expenses
(exclusive of depreciation,  12,150     11,707     38,295        35,338
amortization and non-cash
compensation)
Non-cash compensation        5,912      3,869      23,107        10,902
Depreciation and             73,183     73,915     219,492       219,283
amortization
Gain on disposition of       (787)      (739)      (2,094)       (5,309)
assets
                            253,912    242,764    765,889       723,624
Operating income            69,272     63,522     165,458       153,772
                                                             
Other expense (income)                                        
Loss on extinguishment of    —         1,984      —            31,956
debt
Interest income              (42)       (147)      (121)         (270)
Interest expense             37,677     38,534     112,264       117,081
                            37,635     40,371     112,143       148,767
                                                             
Income before income tax     31,637     23,151     53,315        5,005
expense
Income tax expense          13,297     11,655     19,790        2,403
                                                             
Net income                  18,340     11,496     33,525        2,602
Preferred stock dividends    91         91         273           273
Net income applicable to     $ 18,249   $ 11,405   $ 33,252      $ 2,329
common stock
                                                             
Earnings per share:                                           
Basic income per share      $ 0.19     $ 0.12     $ 0.35        $ 0.02
Diluted income per share    $ 0.19     $ 0.12     $ 0.35        $ 0.02
                                                             
Weighted average common                                       
shares outstanding:
- basic                      94,528,877 93,423,063 94,282,629    93,265,621
- diluted                    94,927,069 93,729,512 94,692,129    93,550,891
                                                             
OTHER DATA                                                   
Free Cash Flow Computation:                                   
Adjusted EBITDA              $ 147,580  $ 140,567  $ 405,963     $ 378,648
Interest, net                (33,373)   (34,057)   (100,789)     (103,710)
Current tax expense         (1,368)    (521)      (2,753)       (1,304)
Preferred stock dividends    (91)       (91)       (273)         (273)
Total capital expenditures   (24,956)   (28,205)   (77,677)      (77,747)
^(1)
Free cash flow               $ 87,792   $ 77,693   $ 224,471     $ 195,614
^(1)See the capital                                           
expenditures detail included
below for a breakdown by                                     
category.
                                                September 30, December 31,
                                                2013          2012
Selected Balance Sheet Data:                                  
Cash and cash equivalents                        $ 182,665     $ 58,911
Working capital (deficit)                        (136,973)     103,778
Total assets                                     3,625,422     3,514,030
Total debt (including                            2,142,814     2,160,854
current maturities)
Total stockholders' equity                       933,491       874,833

                                                     
                                                     
                                Three months ended    Nine months ended
                                September 30,         September 30,
                                2013       2012       2013        2012
                                                               
Other Data:                                                     
Cash flows provided by operating $ 142,730 $ 119,326 $ 294,684 $ 253,349
activities
Cash flows used in investing     (74,791)   (68,250)   (157,043)   (127,344)
activities
Cash flows used in financing     (4,482)    (112,130)  (13,293)    (121,582)
activities
                                                               
                                                               
Reconciliation of Free Cash Flow
to Cash Flows Provided by                                       
Operating Activities:
Cash flows provided by operating $ 142,730 $ 119,326 $ 294,684 $ 253,349
activities
Changes in operating assets and  (28,043)   (11,769)   12,686   24,593
liabilities
Total capital expenditures       (24,956)   (28,205)   (77,677)    (77,747)
Preferred stock dividends        (91)       (91)       (273)       (273)
Other                            (1,848)    (1,568)    (4,949)     (4,308)
Free cash flow                  $87,792  $77,693  $ 224,471 $195,614
                                                               
                                                               
Reconciliation ofAdjusted                                      
EBITDA to Net income:
Adjusted EBITDA                  $ 147,580 $ 140,567 $ 405,963 $ 378,648
Less:                                                           
Non-cash compensation            5,912     3,869     23,107   10,902
Depreciation and amortization    73,183    73,915    219,492   219,283
Gain on disposition of assets    (787)      (739)      (2,094)     (5,309)
Operating Income                 69,272    63,522    165,458   153,772
                                                               
Less:                                                           
Interest income                  (42)       (147)      (121)       (270)
Loss on extinguishment of debt   —         1,984     —          31,956
Interest expense                 37,677    38,534    112,264   117,081
Income tax expense               13,297    11,655    19,790   2,403
Net income                       $ 18,340  $ 11,496  $ 33,525  $ 2,602
                                                               

                                                                
                                                                
                                  Three months ended         
                                  September 30,               
                                  2013           2012           % Change
Reconciliation of Reported Basis                                
to Pro Forma (a) Basis:
Reported net revenue               $ 323,184       $ 306,286      5.5%
Acquisitions and divestitures      —               10,190         
Pro forma net revenue              $ 323,184       $ 316,476      2.1%
                                                               
Reported direct advertising and    $ 163,454       $ 154,012      6.1%
G&A expenses
Acquisitions and divestitures      —               5,467          
Pro forma direct advertising and   $ 163,454       $ 159,479      2.5%
G&A expenses
                                                               
Reported outdoor operating income  $ 159,730       $ 152,274      4.9%
Acquisitions and divestitures      —               4,723          
Pro forma outdoor operating income $ 159,730       $ 156,997      1.7%
                                                               
Reported corporate expenses        $ 12,150        $ 11,707       3.8%
Acquisitions and divestitures      —               —              
Pro forma corporate expenses       $ 12,150        $ 11,707       3.8%
                                                               
Reported Adjusted EBITDA           $ 147,580       $ 140,567      5.0%
Acquisitions and divestitures      —               4,723          
Pro forma Adjusted EBITDA          $ 147,580       $ 145,290      1.6%
                                                               
(a)Pro forma net revenues, direct advertising and general and administrative
expenses, outdoor operating income, corporate expenses and Adjusted EBITDA
include adjustments to 2012 for acquisitions and divestitures for the same
time frame as actually owned in 2013.

                                                          
                                                          Three months ended
                                                          September 30,
                                                          2013      2012
Reconciliation of Outdoor Operating Income to Operating             
Income:
Outdoor operating income                                   $ 159,730 $ 152,274
Less:Corporate expenses                                   12,150    11,707
Non-cash compensation                                      5,912     3,869
Depreciation and amortization                              73,183    73,915
Plus:Gain on disposition of assets                        787       739
Operating income                                           $ 69,272  $ 63,522

                                                        
                                      Three months ended Nine months ended
                                      September 30,      September 30,
                                      2013      2012     2013     2012
Capital expenditure detail by category                          
Billboards - traditional               $6,795   $5,917  $19,271 $20,938
Billboards - digital                   11,362    12,272   34,965   32,334
Logo                                   3,050     2,267    7,157    5,547
Transit                                26        26       54       110
Land and buildings                     428       4,486    6,036    9,401
Operating equipment                    3,295     3,237    10,194   9,417
Total capital expenditures             $24,956  $28,205 $77,677 $77,747

CONTACT: Keith A. Istre
         Chief Financial Officer
         (225) 926-1000
         KI@lamar.com
 
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