“The operating environment remained choppy in Q3 with customers continuing to take a cautious approach to their campaigns particularly on the national side,” was how Sean Reilly opened the Lamar 3Q earnings conference call.  Here are the results of the Lamar 3Q 23 earnings release, Lamar 3Q 23 10Q  and conference call.

• Total revenue grew 2.9% to $543 million in the third quarter of 2023.  Aquisition adjusted revenue grew 1.5%.  Lamar CEO Sean Reilly said local was up for the quarter and national and programmatic were down.  Rates and occupancy stayed the same.  Lamar’s weakest regions were the Pacific Northwest and the Northeast due to reliance on national advertising in those markets.
• Adjusted Cashflow (EBIDTA) increased 6% to $265 million due to tight expense controls.
• Capital expenditures totaled $39 million for the quarter, including $13 million maintenance.  Lamar added 84 new digital bulletin displays in the third quarter bringing total digital bulletin displays to 4,700 at quarter end.
• The company finished the quarter with $3.4 billion in debt at a weighted average cost of 5% and an average debt maturity of 4.5 years.  Debt/Cashflow was a low 3.2 times.

Lamar CEO Sean Reilly on what’s up and what’s down

Q3 categories of particular strength included services and amusement and entertainment while retail education and real estate were weaker.   Insurance which has been a tough category all year has stabilized and was close to flat.  Political by the way was off…which is typical for an off cycle year for the quarter…Services and amusements were particularly strong and in Q3 up approximately 16 and 11% respectively…retail down 8% education down 6% and real estate down 10%

Reilly says acquisitions will be muted in 23 and 24

We completed 11 acquisitions in the quarter for $78 million including the purchase of a terrific legacy billboard plant along the Florida Alabama Gulf Coast that brought our year to date total in in and a spend to 120 million we should be largely done for this year and by the way anticipate another relatively quiet year in 2024 on the M&A front

CFO Jay Johnson says Lamar will use free cashflow to pay down debt.

If we’re in a a more muted acquisition profile next year we are going to be pretty aggressive and use our free cash flow to pay down our our floating rate debt that’s probably the best investment that we can make at this moment and we’ll be focused on next year we could see leverage tick down by the end of the year below 3 which would be the best in the history of the company and set us up well for for any opportunities

Billboard Insider’s take:  Lamar has turned conservative.  Fewer acqusitions and the company is paying down debt.  The market liked what it heard.  Lamar stock was up 12% on a day when OUTFRONT grew 10%, Boston Omaha grew 3%, the S&P 500 grew 2% and Clear channel Outdoor declined 2%.

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