Excuse me, everyone. We now have Sean Reilly and Jay Johnson in conference. Please be aware that each of your lines is in a listen-only mode. At the conclusion of the company’s presentation, we’ll open the floor for questions. [Operator Instructions] In the course of this discussion, Lamar may make forward-looking statements regarding the company, including statements about its future financial performance, strategic goals, plans and objectives including with respect to the amount and timing of any distributions to stockholders and the impact and effect of the COVID-19 pandemic on the company’s business, financial condition and results of operations. All forward-looking statements involve risks, uncertainties, and contingencies, many of which are beyond Lamar’s control and which may cause actual results to differ materially from anticipated results. Lamar has identified important factors that could cause actual results to differ materially from those discussed in this call, in the Company’s second quarter 2021 earnings release and its most recent Annual Report on Form 10-K. Lamar refers you to those documents. Lamar’s second quarter 2021 earnings release, which contains information required by Regulation G regarding certain non-GAAP financial measures was furnished to the SEC on a Form 8-K this morning and is available on the Investors section of Lamar’s website at lamar.com. I would now like to turn the conference over to Sean Reilly. Mr. Reilly, you may begin.

Thank you, Olivia. Good morning, and welcome to Lamar’s Q2 2021 Earnings Call. I’ll get right to the good news. The advertising market is, as you may have heard, red hot right now. Advertisers are scrambling to get their brands, their products and their services in front of their customers, so they don’t miss out on the economic recovery and we are benefiting in a major way. Our second quarter results easily exceeded our expectations and our bookings into the current quarter suggest the sales momentum will continue through the end of 2021. We are increasingly confident that billboard revenue for the full year 2021 will surpass 2019’s total and that transit and airport are well on their way back. As you saw in the release, we are raising our guidance again as I suggested we might on the last call, we now believe full year AFFO per share will come at – come in between $6.10 and $6.30 per share. If you do the numbers, you’ll see that reaching the top end of that range would mean exceeding the EBITDA we generated in 2019. The delta variant is out there, obviously, and we’re keeping a close eye on it. So far, we have not seen a noticeable impact on our customers’ activities with us. Here is our latest data point to that point. Our billboard bookings in July were about $10 million higher in July of 2021 than in July of 2019. The bulk of that increase incurred in the – occurred in the second half of July, so business remain solid. Turning to the second quarter, we saw strength across all products. Billboard revenues surpassed our revenue for the second quarter of 2019 and bookings in the U.S. transit and airport business has improved, a trend by the…

Thanks, Sean. Good morning, everyone, and thank you for joining us. I will begin with brief comments on the quarter, then review our balance sheet and conclude with a discussion of our current financial position including a little more detail around this morning’s revised guidance. We are extremely pleased with our second quarter results, which exceeded internal expectations as well as consensus estimates for revenue, adjusted EBITDA and AFFO. The company achieved AFFO growth for the third consecutive quarter, improving 84.2% to $1.75 per share on a fully diluted basis. In the second quarter, acquisition adjusted revenue increased 28.9% from the same period last year, demonstrating the resilience of our business and the benefits of our operating model with a portfolio heavily concentrated in billboards. Q2 acquisition adjusted revenue was only slightly behind the second quarter of 2019 with both May and June results essentially flat against 2019. As you may recall, in response to COVID-19, we implemented several cost reduction initiatives during 2020. With the second quarter returning to more normal levels, acquisition adjusted operating expenses increased 9.3% driven primarily by variable expenses tied to revenue. We reduced the operating expenses by approximately $80 million in 2020 and anticipated about half of those expenses of $40 million were returned as revenue rebounded. With revenue performance exceeding our expectations from the beginning of the year, we now forecast approximately $45 million of operating expenses will return in 2021, with expenses coming at around $940 to $945 million for the full year. Adjusted EBITDA for the quarter was $213.5 million, compared to $133.2 million in 2020, which was an increase of 60.3%. On an acquisition adjusted basis, the increase was 59.9%. Adjusted EBITDA margin was 48% versus 38.3% in the second quarter of 2020 and 170 basis points ahead of the…

Thanks, Jay. Let me add a little more color to a few of the data points and then we’ll open it up for questions. In terms of regional strength, of course, there were strength across the Board comp to last year, but it was interesting to note that the harder – the regions that got the hardest hit by COVID have felt the strongest pro forma recovery. For example, the Northeast region was up 42% Q2 this year over Q2 last year and the Western region was up 34% Q2 this year over Q2 last year. Again just sort of interesting to note that the recovery is – was swiftest in those regions that got hit the hardest. Turning to digital deployment, again as I mentioned, we have experienced some supply disruption in terms of ordering digital units. As we noted in the release, we put about 82 units – new digital units in the air so far this year and we believe that that will end up the year at around 215. But as I mentioned, we’ve got more than 100 units on order and we expect to catch up as we move into 2022. Same digital unit revenue, again, it’s kind of silly comparing Q2 this year to Q2 last year, but I’m going to do it anyway. Our digital revenues were up 56% Q2 this year over Q2 last year. Jay mentioned our sales mix 78% local, 22% national. Jay also mentioned that national has come on strong of late. We’re not look to Q2 of this year over Q2 of last year, local regional business was up 26%, national and programmatic Q2 this year over Q2 last year was up 43%. Again, speaking to the acquisition pipeline, as Jay mentioned, the pipeline is strong and we believe that we will end the year somewhere north of $150 million in total acquisition value. And finally, talking to the categories of business, again comping to Q2 of last year can be a little silly. I hope we never have those kind of comps again, but as I mentioned in my opening, virtually all of our verticals have normalized in our book and our fully recovered, if you will, except for amusements, entertainment, sports, and we feel like as we move into the fall that is coming on fast and strong. So with that, Olivia, we will open it up for questions.

Thank you. [Operator Instructions] Our first question comes from Ben Swinburne with Morgan Stanley. Please go ahead.

Hey Ben, good morning.

Hey, good morning guys. How you’re doing?

Good.

I guess a couple of questions I wanted to ask. One is on margins which was 48% this quarter, you guys have talked about sort of savings beyond COVID, permanent savings, are those better than you thought because these margin numbers obviously are nicely ahead of where you used to operate? Just trying to think about the margins in the business as you look out? And then Sean, I want to ask you about the new hire – I don’t know if CTO is the right title, but you guys made a new hire on the technology side, I think that’s an interesting move for the company. Can you just expand a little bit on his mandate and how you’re thinking about that impact the business over time?

Sure. Thanks, Ben. So on the margin question, yes, we’re very pleased with that – we’ve been able to hang on to a lot of the initiatives on the expense side that we put in place last year. So I think when we finish up this year, we’re going to set records for margins for the full year and as we go into 2022 that picture should remain and again if the macro stays – the wind stay at our back 2022 I think will be the high watermark for margins in the history of the company. Yes, a vendor is now on board. What a great addition to the team on the IT side. So, we have been without a head of IT for give or take eight or nine months. So we have been on this journey to replace our former head of IT, but Sukhvinder brings a different skill set to that role and I think it’s more along the lines of making and aligning the technologies that we deploy a little more friendly on to all of the business units. At Lamar, we’ve never been bleeding edge when it comes to technology, but we’ve try to be pretty fast followers and Sukhvinder is going to help us do that.

Got it. And maybe just one follow-up on the Vistar investment. You’ve talked about sort of the programmatic business being a nice additional source of demand in revenue, but it’s not, the margins aren’t as good as your core business. Do you see a path over time to improving those economics? I’m sure, you’d like to, but do you see an opportunity to maybe there bring more technology in-house or is that channel matures? Can you make that as efficient as your other sales channels, you think?

So, yes, the delta there been is about 4% to 5% in terms of cost of sales, a programmatic sale in terms of just pure cost of sales, run to 10% to 11% and our traditional channels run 6-ish. So what we’re seeing that really gets us fired up about programmatic is that our CPMs are running a little higher. So we are actually getting a slightly higher CPM on a programmatic sale than we do through the traditional channel. So net-net, the margin contribution ends up being about the same. So that’s – all that’s really, really good stuff, and I think we’re about in the second inning here in terms of programmatic buying and selling of out-of-home globally and certainly we’re about there again in the U.S. domestic market as well. Vistar is the leader in the U.S. domestic market. There are other programmatic partners that we have that are bigger when it comes to their global presence, but Vistar is the largest U.S. domestic programmatic provider.

Thanks a lot.

Thanks, Ben.

Thank you. [Operator Instructions] Our next question comes from Alexia Quadrani with J.P. Morgan. Please go ahead.

Hi, this is Anna on for Alexia. Thanks so much for the question. Just in terms of your very strong guidance for the full year and the rebound that you’re seeing across the board and billboards. I was wondering if you can discuss what you expect for airport and transit, particularly in light of the delta variant and COVID right now? Thanks.

Great question. Obviously, we’re monitoring delta as closely as we can as everyone else is as well. When I think about the guidance and the delta variant, assuming that the pace of business that we’re seeing right now continues. We should be at the upper end if not slightly exceeding the upper end of our guidance that we just issued. If delta creates some headwinds for us and our customers, it’s my sense that we’re still good at the bottom end, right. So, we kind of try to think about a little bit about where delta was leading us, obviously it would hit our airport businesses the hardest, but right now, our airport business is bouncing back nicely and you all can track the ridership of different transit and the plane boardings through different airports. And if the audience stays true, then we’re going to be just fine.

Okay. Thanks, Sean.

Thanks, Anna.

Thank you. With no further questions, I will turn the conference back to Mr. Reilly for closing remarks.

Thank you, Olivia, and thank you, all. We certainly look forward to visiting in November with our Q3 2021 call and you all stay safe out there.

Thank you, ladies and gentlemen. This concludes today’s teleconference. You may now disconnect.