Sean Reilly: Mainstreet is Healthy

Sean Reilly, CEO, Lamar Advertising

Here are a selection of Lamar CEO Sean Reilly’s comments at yesterday’s 52nd annual  JP Morgan 2024 Global Technology, Media and Communications Conference.

Mainstreet is healthy.

Mainstreet is healthy.  That’s the take home message.  Last year I was only getting questions about how Lamar does in a recession.  All those questions have gone away.

Programmatic is hot.

It’s gonna be up you know 35-ish percent in Q2… last year we got caught up a little bit in the sort of digital pull back because of the privacy issues…the other thing that happened was some competitive screens came online…the buying community is now appreciating that all screens are not created equally and the large format digital screens are now rapidly gaining share in the programmatic space…

Digital Billboard Conversion economics

You’ve got…a static billboard on the Interstate.  Let’s say we’re getting $3000 a month for it all right we take it down we put up a digital and we’re gonna get…$15,000-18,000 a month for it right…A digital 14 by 48 cost a little north of $200,000 and you’ve got to retro the structure a little bit…let’s tack on another $20,000. That’s your CapEx.   Your revenues are $15,000-18,000 a month times 12.   Subtract sales commission of give or take 6% and subtract your ground lease expense which is about 10%. Your incremental margin is in the low 80s percent and you do all that arithmetic and you see a very quick payback and a nice ROI

Lamar can still grow via acquisition

You’ve got maybe five companies outside of the big three that have asset values of let’s call it $500 million to a billion…and then you know asset value between you know let’s call it $50-500 million you’ve got maybe 10.  And then asset value under $100 million there’s literally hundreds of them right so you’ve got a long tail of smaller independents…In a given year we’ve done…give or take 120 to $150 million worth of those little deals…lots and lots of deals averaging eight $9 million.   This year we curtailed that activity a little bit because again we want to pay down our Term Loan A.


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