Lamar Advertising Company LAMR reported fourth-quarter 2020 adjusted funds from operations (FFO) per share of $1.71, outpacing the Zacks Consensus Estimate of $1.50. Moreover, the figure is up from the $1.64 reported in the year-ago period.

Results reflect better-than-expected revenue numbers for the quarter. Also, the company benefited from a fall in operating expenses.

Particularly, quarterly net revenues came in at $428.5 million, surpassing the consensus mark of $416.4 million. However, on a year-over-year basis, net revenues for the quarter declined 7.4%.

Reflecting broader market sentiments, shares of the company edged down 0.3% during Friday’s regular trading session.

According to the company’s chief executive Sean Reilly, “We concluded 2020 with a strong fourth quarter, aided by a recovery in national advertising and a surge in political spending, as well as further good work on the expense side."

Moreover, he pointed that, "We have begun to invest again in our platform, and, with the strongest balance sheet in the industry, we are positioned well to benefit as the advertising market recovers further in 2021.”

For full-year 2020, the company reported adjusted FFO per share of $5.10, down from the prior year’s $5.80. Net revenues declined 10.5% to $1.57 billion from the $1.75 billion reported last year.

Quarter in Detail

Acquisition-adjusted net revenues for the fourth quarter decreased 6.8% year on year to $428.5 million. Also, acquisition-adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell 2.8% to $207.9 million.

Operating income marginally declined to $141.2 million from the year-earlier period’s $141.4 million, while adjusted EBITDA went down 3.6% to $207.9 million. However, free cash flow of $160.1 million increased 18.3% year over year during the December-end quarter.

Operating expenses slid 10.6% from the prior-year quarter to $287.3 million.

Balance Sheet

At the end of 2020, Lamar Advertising had total liquidity of $910.1 million. This comprised $736 million available for borrowing under its revolving senior credit facility, $52.5 million available under the Accounts Receivable Securitization Program, and $121.6 million in cash and cash equivalents.

Outlook

Lamar Advertising projects 2021 adjusted FFO per share at $5.20-$5.50. The Zacks Consensus Estimate for the same is currently pinned at $6.55.

Dividend Update

On Feb 25, Lamar announced a quarterly dividend of 75 cents per share, which reflects a 50% increase from the 50 cents paid in the prior quarter. The dividend will be paid on Mar 31, 2021, to stockholders of record of Lamar’s Class A and Class B common stock as of Mar 22, 2021.

Lamar predicts total quarterly distributions to stockholders in 2021 to aggregate $3.00 per common share, inclusive of the dividend payable on Mar 31, 2021.

Lamar currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.