September 30, 2021 10Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________________________

FORM 10-Q

________________________________________________________

• Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2021

or

• Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

	For the transition period from		to
		Commission File Number 1-36756
	__________________________________
	Lamar Advertising Company
	________________________________________________
		Commission File Number 1-12407
	________________________________________________
	Lamar Media Corp.
	(Exact name of registrants as specified in their charters)
	__________________________________
Delaware				47-0961620
Delaware				72-1205791
(State or other jurisdiction of incorporation or organization)			(I.R.S Employer Identification No.)
5321 Corporate Blvd., Baton Rouge, LA	70808
(Address of principal executive offices)				(Zip Code)
	Registrants' telephone number, including area code: [phone]
	Securities registered pursuant to Section 12(b) of the Act:
Title of each class		Trading Symbol(s)				Name of each exchange on which registered
Class A common stock, $0.001 par value		LAMR				The NASDAQ Stock Market, LLC

Indicate by check mark whether each registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether each registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨

Indicate by check mark whether Lamar Advertising Company is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨
Emerging growth company	¨

If an emerging growth company, indicate by check mark if Lamar Advertising Company has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether Lamar Media Corp. is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. ☐

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	x	Smaller reporting company	¨
Emerging growth company	¨

If an emerging growth company, indicate by check mark if Lamar Media Corp. has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether Lamar Advertising Company is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ¨ No x

Indicate by check mark whether Lamar Media Corp. is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ¨ No x

The number of shares of Lamar Advertising Company's Class A common stock outstanding as of October 29, 2021: 86,819,395

The number of shares of the Lamar Advertising Company's Class B common stock outstanding as of October 29, 2021: 14,420,085

The number of shares of Lamar Media Corp. common stock outstanding as of October 29, 2021: 100

This combined Form 10-Q is separately filed by (i) Lamar Advertising Company and (ii) Lamar Media Corp. (which is a wholly owned subsidiary of Lamar Advertising Company). Lamar Media Corp. meets the conditions set forth in general instruction H(1) (a) and (b) of Form 10-Q and is, therefore, filing this form with the reduced disclosure format permitted by such instruction.

NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain information included in this report is forward-looking in nature within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. This report uses terminology such as "anticipates," "believes," "plans," "expects," "future," "intends," "may," "will," "should," "estimates," "predicts," "potential," "continue" and similar expressions to identify forward-looking statements. Examples of forward-looking statements in this report include statements about:

• our future financial performance and condition;
• our business plans, objectives, prospects, growth and operating strategies;
• our future capital expenditures and level of acquisition activity;
• market opportunities and competitive positions;
• our future cash flows and expected cash requirements;
• estimated risks;
• our ability to maintain compliance with applicable covenants and restrictions included in Lamar Media's senior credit facility, Accounts Receivable Securitization Program and the indentures relating to its outstanding notes;
• stock price;
• estimated future dividend distributions; and
• our ability to remain qualified as a Real Estate Investment Trust ("REIT").

Forward-looking statements are subject to known and unknown risks, uncertainties and other important factors, including but not limited to the following, any of which may cause the actual results, performance or achievements of Lamar Advertising Company (referred to herein as the "Company" or "Lamar Advertising") or Lamar Media Corp. (referred to herein as "Lamar Media") to differ materially from those expressed or implied by the forward-looking statements:

• the state of the economy and financial markets generally and their effects on the markets in which we operate and the broader demand for advertising;
• the magnitude of the impact of the COVID-19 pandemic on our operations and on general economic conditions;
• the levels of expenditures on advertising in general and outdoor advertising in particular;
• risks and uncertainties relating to our significant indebtedness;
• the demand for outdoor advertising and its continued popularity as an advertising medium;
• our need for, and ability to obtain, additional funding for acquisitions, operations and debt refinancing;
• increased competition within the outdoor advertising industry;
• the regulation of the outdoor advertising industry by federal, state and local governments;
• our ability to renew expiring contracts at favorable rates;
• the integration of businesses and assets that we acquire and our ability to recognize cost savings and operating efficiencies as a result of these acquisitions;
• our ability to successfully implement our digital deployment strategy;
• the market for our Class A common stock;
• changes in accounting principles, policies or guidelines;
• our ability to effectively mitigate the threat of and damages caused by hurricanes and other kinds of severe weather;
• our ability to maintain our status as a REIT; and
• changes in tax laws applicable to REITs or in the interpretation of those laws.

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The forward-looking statements in this report are based on our current good faith beliefs, however, actual results may differ due to inaccurate assumptions, the factors listed above or other foreseeable or unforeseeable factors. Consequently, we cannot guarantee that any of the forward-looking statements will prove to be accurate. The forward-looking statements in this report speak only as of the date of this report, and Lamar Advertising and Lamar Media expressly disclaim any obligation or undertaking to update or revise any forward-looking statement contained in this report, except as required by law.

For a further description of these and other risks and uncertainties, the Company encourages you to read carefully Item 1A to the combined Annual Report on Form 10-K for the year ended December 31, 2020 of the Company and Lamar Media (the "2020 Combined Form 10-K"), filed on February 26, 2021, and as such risk factors may be further updated or supplemented, from time to time, in our future combined Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

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CONTENTS

	Page
PART I - FINANCIAL INFORMATION	5
ITEM 1. FINANCIAL STATEMENTS	5
Lamar Advertising Company
Condensed Consolidated Balance Sheets as of September 30, 2021 and December 31, 2020	5
Condensed Consolidated Statements of Income and Comprehensive Income for the three and nine months
ended September 30, 2021 and 2020	6
Condensed Consolidated Statements of Stockholders' Equity for the three and nine months ended September
30, 2021 and 2020	7-8
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2021 and 2020	9
Notes to Condensed Consolidated Financial Statements	10-21
Lamar Media Corp.
Condensed Consolidated Balance Sheets as of September 30, 2021 and December 31, 2020	22
Condensed Consolidated Statements of Income and Comprehensive Income for the three and nine months
ended September 30, 2021 and 2020	23
Condensed Consolidated Statements of Stockholder's Equity for the three and nine months ended September
30, 2021 and 2020	24
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2021 and 2020	25
Notes to Condensed Consolidated Financial Statements	26-34
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	35-52
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk	53
ITEM 4. Controls and Procedures	53
PART II - OTHER INFORMATION	54
ITEM 1A. Risk Factors	54
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds	54
ITEM 5. Other Information	54
ITEM 6. Exhibits	55

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Table of Contents

PART I - FINANCIAL INFORMATION

ITEM 1. - FINANCIAL STATEMENTS

LAMAR ADVERTISING COMPANY

AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

		September 30,			December 31,
		2021			2020
		(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	87,569	$	121,569
Receivables, net of allowance for doubtful accounts of $12,458 and $14,946 in 2021 and 2020, respectively		262,661			240,854
Other current assets		20,202			18,147
Total current assets		370,432			380,570
Property, plant and equipment		3,720,040			3,615,505
Less accumulated depreciation and amortization		(2,428,803)			(2,333,656)
Net property, plant and equipment		1,291,237			1,281,849
Operating lease right of use assets		1,208,425			1,222,013
Financing lease right of use assets		17,604			19,670
Goodwill		1,926,919			1,912,328
Intangible assets, net		909,508			914,446
Other assets		94,562			60,565
Total assets	$	5,818,687	$	5,791,441
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Trade accounts payable	$	12,655	$	12,017
Current maturities of long-term debt, net of deferred financing costs of $641 and $445 in 2021 and 2020,		174,725			122,434
respectively
Current operating lease liabilities		174,659			195,439
Current financing lease liabilities		1,331			1,331
Accrued expenses		114,194			105,288
Deferred income		128,991			111,363
Total current liabilities		606,555			547,872
Long-term debt, net of deferred financing costs of $37,446 and $39,672 in 2021 and 2020, respectively		2,662,656			2,764,082
Operating lease liabilities		977,941			993,776
Financing lease liabilities		17,609			18,608
Deferred income tax liabilities		6,016			4,854
Asset retirement obligation		267,024			222,876
Other liabilities		39,090			36,605
Total liabilities		4,576,891			4,588,673
Stockholders' equity:
Series AA preferred stock, par value $0.001, $63.80 cumulative dividends, 5,720 shares authorized; 5,720		-			-
shares issued and outstanding at 2021 and 2020
Class A common stock, par value $0.001, 362,500,000 shares authorized; 87,505,031 and 87,111,327 shares
issued at 2021 and 2020, respectively; 86,819,395 and 86,491,646 outstanding at 2021 and 2020,		88			87
respectively
Class B common stock, par value $0.001, 37,500,000 shares authorized, 14,420,085 shares issued and		14			14
outstanding at 2021 and 2020
Additional paid-in capital		1,997,162			1,963,850
Accumulated comprehensive income		850			934
Accumulated deficit		(705,745)			(717,331)
Cost of shares held in treasury, 685,636 and 619,681 shares at 2021 and 2020, respectively		(50,573)			(44,786)
Stockholders' equity		1,241,796			1,202,768
Total liabilities and stockholders' equity	$	5,818,687	$	5,791,441

See accompanying notes to condensed consolidated financial statements.

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