Lamar Advertising Company Announces Fourth Quarter And Year End 2012 Operating Results

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 management believes that excluding the operating results related to the Next markets from our pro forma results is useful to investors during the initial integration. 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, February 27, 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:	20435467
	Available through Monday, March 4, 2013 at 11:59 p.m. eastern time
Live Webcast:	www.lamar.com
Webcast Replay:	www.lamar.com
	Available through Monday, March 4, 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		Twelve months ended
	December 31,		December 31,
	2012	2011	2012	2011
Net revenues	$ 305,505	$ 288,239	$ 1,182,901	$ 1,133,487
Operating expenses (income)
Direct advertising expenses	106,199	103,243	418,538	409,052
General and administrative expenses	51,994	48,495	203,065	193,854
Corporate expenses	11,537	10,662	46,875	43,466
Non-cash compensation	3,564	4,312	14,466	11,650
Depreciation and amortization	76,800	78,185	296,083	299,639
Gain on disposition of assets	(8,508)	(2,581)	(13,817)	(10,548)
	241,586	242,316	965,210	947,113
Operating income	63,919	45,923	217,691	186,374
Other expense (income)
Loss on extinguishment of debt	9,676	226	41,632	677
Interest income	(61)	(58)	(331)	(569)
Interest expense	40,012	41,636	157,093	171,093
	49,627	41,804	198,394	171,201
Income before income tax	14,292	4,119	19,297	15,173
Income tax expense (benefit)	7,073	(2,253)	9,476	6,623
Net income	7,219	6,372	9,821	8,550
Preferred stock dividends	92	92	365	365
Net income applicable to common stock	$ 7,127	$ 6,280	$ 9,456	$ 8,185
Earnings per share:
Basic income per share	$ 0.08	$ 0.07	$ 0.10	$ 0.09
Diluted income per share	$ 0.08	$ 0.07	$ 0.10	$ 0.09
Weighted average common shares outstanding:	93,717,650	92,976,771	93,379,246	92,851,067
- basic	94,075,642	93,171,888	93,666,641	93,173,785
- diluted
OTHER DATA
Free Cash Flow Computation:
Adjusted EBITDA	$ 135,775	$ 125,839	$ 514,423	$ 487,115
Interest, net	(35,311)	(36,881)	(139,021)	(152,007)
Current tax expense	(622)	(1,072)	(1,926)	(2,921)
Preferred stock dividends	(92)	(92)	(365)	(365)
Total capital expenditures (1)	(27,823)	(23,888)	(105,570)	(107,070)
Free cash flow	$ 71,927	$ 63,906	$ 267,541	$ 224,752
(1)See the capital expenditures detail included
below for a breakdown by category.
			December 31,	December 31,
			2012	2011
Selected Balance Sheet Data:
Cash and cash equivalents			$ 58,911	$ 33,503
Working capital			103,778	95,281
Total assets			3,514,030	3,427,353
Total debt (including current maturities)			2,160,854	2,158,528
Total stockholders' equity			874,833	838,998

	Three months ended		Twelve months ended
	December 31,		December 31,
	2012	2011	2012	2011
Other Data:
Cash flows provided by operating activities	$ 122,560	$ 96,116	$ 375,909	$ 318,821
Cash flows used in investing activities	176,055	29,263	303,399	117,255
Cash flows provided by (used in) financing activities	74,165	(75,015)	(47,417)	(259,442)
Reconciliation of Free Cash Flow to Cash Flows Provided by Operating Activities:
Cash flows provided by operating activities	$ 122,560	$ 96,116	$ 375,909	$ 318,821
Changes in operating assets and liabilities	(21,542)	(5,185)	3,051	20,957
Total capital expenditures	(27,823)	(23,888)	(105,570)	(107,070)
Preferred stock dividends	(92)	(92)	(365)	(365)
Other	(1,176)	(3,045)	(5,484)	(7,591)
Free cash flow	$ 71,927	$ 63,906	$ 267,541	$ 224,752
Reconciliation of Adjusted EBITDA to Net income (loss):
Adjusted EBITDA	$ 135,775	$ 125,839	$ 514,423	$ 487,115
Less:
Non-cash compensation	3,564	4,312	14,466	11,650
Depreciation and amortization	76,800	78,185	296,083	299,639
Gain on disposition of assets	(8,508)	(2,581)	(13,817)	(10,548)
Operating Income	63,919	45,923	217,691	186,374
Less:
Interest income	(61)	(58)	(331)	(569)
Loss on extinguishment of debt	9,676	226	41,632	677
Interest expense	40,012	41,636	157,093	171,093
Income tax expense (benefit)	7,073	(2,253)	9,476	6,623
Net income	$ 7,219	$ 6,372	$ 9,821	$ 8,550

	Three months ended
	December 31,
	2012	2011	% Change
Reconciliation of Reported Basis to Pro Forma (a) Basis:
Reported net revenue	$ 305,505	$ 288,239	6.0%
Acquisitions and divestitures, excluding the Next markets	—	4,517
Less net revenue – Next markets	5,156	—
Pro forma net revenue, excluding the Next markets	$ 300,349	$ 292,756	2.6%
Reported direct advertising and G&A expenses	$ 158,193	$ 151,738	4.3%
Acquisitions and divestitures, excluding the Next markets	—	2,734
Less direct advertising and G&A expenses – Next markets	1,546	—
Pro forma direct advertising and G&A expenses, excluding the Next markets	$ 156,647	$ 154,472	1.4%
Reported outdoor operating income	$ 147,312	$ 136,501	7.9%
Acquisitions and divestitures, excluding the Next markets	—	1,783
Less outdoor operating income – Next markets	3,610	—
Pro forma outdoor operating income, excluding the Next markets	$ 143,702	$ 138,284	3.9%
Reported corporate expenses	$ 11,537	$ 10,662	8.2%
Acquisitions and divestitures, excluding the Next markets	—	—
Pro forma corporate expenses, excluding the Next markets	$ 11,537	$ 10,662	8.2%
Reported Adjusted EBITDA	$ 135,775	$ 125,839	7.9%
Acquisitions and divestitures, excluding the Next markets	—	1,783
Less EBITDA – Next markets	3,610	—
Pro forma Adjusted EBITDA, excluding the Next markets	$ 132,165	$ 127,622	3.6%
(a) Pro forma net revenues, direct advertising and general and administrative expenses, outdoor operating income, corporate expenses and Adjusted EBITDA include adjustments to 2011 for acquisitions and divestitures for the same time frame as actually owned in 2012, excluding the operating results of the Next markets. As a result, our pro forma results for the 2012 period  excludes the operating results from the Next markets and no adjustment has been made to the 2011 period with respect to the acquisition of the Next markets.

	Three months ended
	December 31,
	2012	2011
Reconciliation of Outdoor Operating Income to Operating Income:
Outdoor operating income	$ 147,312	$ 136,501
Less: Corporate expenses	11,537	10,662
Non-cash compensation	3,564	4,312
Depreciation and amortization	76,800	78,185
Plus: Gain on disposition of assets	8,508	2,581
Operating income	$ 63,919	$ 45,923

	Three months ended		Twelve months ended
	December 31,		December 31,
	2012	2011	2012	2011
Capital expenditure detail by category
Billboards - traditional	$ 8,123	$ 9,514	$ 29,061	$  34,425
Billboards - digital	9,800	9,169	42,134	41,250
Logo	3,157	2,684	8,704	10,141
Transit	149	177	259	817
Land and buildings	3,396	663	12,797	4,501
Operating equipment	3,198	1,681	12,615	15,936
Total capital expenditures	$ 27,823	$ 23,888	$ 105,570	$ 107,070

CONTACT: Keith A. Istre
         Chief Financial Officer
         [phone]
         [e-mail]

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