Lamar Advertising Company (NASDAQ:LAMR) Q3 2023 Earnings Conference Call November 2, 2023 9:00 AM ET

Company Participants

Sean Reilly - President and Chief Executive Officer

Jay Johnson - Treasurer and Chief Financial Officer

Conference Call Participants

Cameron McVie - Morgan Stanley

Richard Choe - JPMorgan

Operator

Excuse me, everyone. We now have Sean Reilly and Jay Johnson in conference. Please be aware that each of your line is in a listen-only mode. At the conclusion of the company's presentation, we will open the floor for questions. [Operator Instructions]

In the course of this discussion, Lamar may make forward-looking statements regarding the company, including financial performance, strategic goals, plans, and objectives, including with respect to the amount and timing of any distribution to stockholders and the impacts and effects on general economic conditions, on the company's business, financial condition, and results of operations.

All forward-looking statements require risk, uncertainty, and contingency, many of which are beyond Lamar's control and which may cause actual results to differ materially from anticipated results. Lamar has identified important factors that can cause actual results to differ materially from those discussed in the call in the company's third quarter 2023 earnings release and its most recent annual report on Form 10-K. Lamar refers you to those documents.

Lamar's third quarter 2023 earnings release, which contains information required by the Regulation G regarding certain non-GAAP financial measures, was furnished to the SEC on the Form 8-K this morning and is available on the Investor section of Lamar's website, www.lamar.com.

I would now like to turn the conference over to Sean Reilly. Mr. Reilly, you may begin.

Sean Reilly

Thank you, Katie. Good morning all, and welcome to Lamar's third quarter 2023 earnings call.

As we mentioned in the release, the operating environment remained choppy in Q3, with customers continuing to take a cautious approach to their campaigns, particularly on the national side. Despite that, we demonstrated impressive operating leverage in Q3, increasing revenue modestly while decreasing expenses on a year-over-year acquisition-adjusted basis.

The expense result is a credit to the disciplined management of our local general managers. Our team is doing a great job of managing to the macro environment. We also benefited from one-time COVID relief payments in the airport business. Operating margins without the one-time airport relief payments in Q3 were 48.3%. Again, that's an operating margin of 48.3% and improvement over last year's Q3 margins of 47.6%. Again, a great performance by our team. Pro forma expenses without the airport payments were essentially flat.