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 today, we will then open the floor for questions.In the course of this discussion, Lamar may make forward-looking statements regarding the company, including investments about its future financial performance, strategic goals, plans, and objectives, including with respect to the amount of timing of any distributions and stockholders and impacts and effects of the novel coronavirus, on the company's business, financial conditions, 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 the 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 first quarter 2020 earnings release, and its most recent annual report on Form 10-K as updated or supplemented by its quarterly reports on Form 10-Q, and current reports on Form 8-K. Lamar refers you to those documents. Lamar's first quarter 2020 earnings release, which contains information required by Regulation G regarding certain non-GAAP financial measures, which furnished to the SEC on Form 8-K this morning, is available on the Investors section of the Lamar Web site, www.lamar.com.I would now like to turn the conference over to Sean Reilly. Mr. Reilly, you may begin.

Thank you, Carrie. Good morning, everyone. I trust that you and yours are safe and well. Welcome to Lamar's Q1 2020 earnings call. I want to begin by thanking our employees for their dedication and resilience through these trying times. They have distinguished themselves as has the out-of-home industry. We and our colleagues in the industry have donated unprecedented amounts of our inventory to honor frontline healthcare workers and first responders, and to amplify important messages about safety practices and public health in communities all across the country. We, at Lamar, kept all of our constituents, employees, customers, shareholders and the communities we serve top of mind. We are taking all necessary steps to ensure that we emerge stronger than ever as the crisis fade and our economy recovers.Our results in Q1 were strong, and would have been stronger had business not turned midway through March, which we believe cost us $4 million or $5 million in revenue. As it was, Q1 was our 40th consecutive quarter of revenue growth, and an indication that the fundamental to the out-of-home business, our ability to deliver large audiences at affordable prices with powerful messages are prized by advertisers. Obviously, COVID-19 has set us back, and the question on everyone's mind is, "What's ahead?" Our crystal ball is no clearer than anyone else's. However, we think that by the August call, we will be able to provide new full-year AFFO guidance to replace guidance we withdrew in April, but for now, I can tell you how April went, revenues were approximately $116 million, a decline of approximately 20% from pro forma April 2019, and we generated net cash in the month even though we had some digital projects and completed some small acquisitions.That said, April is just a data point, and I would…

Thanks, Sean. Good morning, everyone, and thank you for taking the time to join our call during this extraordinary time in our society and our economy. I will begin with some brief comments on the first quarter, then review our balance sheet, and conclude with a discussion of our current financial position with particular focus on the company's debt obligations and compliance with our financial covenants. In the first quarter, acquisition adjusted revenue growth was 4.4%, while consolidated expenses grew only 1.8% and acquisition adjusted EBITDA increased 8.7%. Adjusted EBITDA was $159.8 million compared to $146.1 million for the first quarter of 2019, an increase of 9.4%, and fully diluted AFFO increased 13.1% to $1.12 per share.Moving over to CapEx, total spend for the quarter was approximately $26 million, comprised of $15 million in growth CapEx and approximately $11 million of maintenance CapEx. As Sean mentioned, we've reduced our 2020 CapEx budget significantly by over 50% to approximately $58 million. CapEx for the balance of the year will be approximately $32 million and pretty evenly split between growth and maintenance with remaining growth CapEx representing expenditures of projects that we're contractually obligated to complete.Turning to our balance sheet, the steps we took during the first quarter should provide for greater stability while lowering both interest expense and scheduled debt amortization. Our balance sheet now is even stronger than in recent years and we continue to believe Lamar enjoys access to both the debt and equity capital markets. The company ended the quarter with total leverage of 4.03 times net debt-to-EBITDA as defined under our credit facility. Furthermore, we had approximately $609 million of liquidity, comprised of $497 million of cash on hand and $112 million of availability under our revolving credit facility.In March, we drew $535 million on our revolver…

Thanks, Jay. I'm going to cover a few of the metrics that you're familiar with, and then I'm going to do a little deeper dive in terms of color on what we're seeing in our verticals. I think that might be helpful. So, digital count, we ended the first quarter with 3,589 digital units, that's an increase of 47 units, a few of those 47 were by acquisition. We actually Greenfield new digital put up 42 in the quarter. Our same digital unit revenue was up 5.9% in Q1. Our national local sales mix 79% local 21% national and problematic for Q1 2020. So that's looking in the rearview mirror.Let's look through the windshield at some of our verticals and talk a little more granularly about them. So our top three verticals, as you're familiar with, are service hospitals and restaurants, and I would say that one, two and three are looking good to strong as we look through the windshield. Service, of course, is primarily attorneys. We're getting a lot of in-bounds from attorneys that are looking to expand their relationships and we feel good about that. But we also feel good about services expanding slightly because there are other services that fall in that category things like pest control, home and office cleaning. As you can imagine, the cleaning services are in great demand, and we're seeing some of that, and so we feel good about the service category. Hospitals and healthcare is also very strong as you can imagine. We're seeing activity in things like elective surgeries as states opened up and there is increased demand and pent-up demand for clinic visits, doctor visits, and elective surgeries.Let's talk about the restaurant category. The vast majority of our restaurant business is quick service and national chains like Cracker…

Thank you. [Operator Instructions] And our first question will be from Alexia Quadrani from JPMorgan.

Hi. This is [Anna] [Ph] on for Alexia. Thank you so much for the question, great commentary on the call as well. Just given that results were not as much affected by COVID-19 in Q1, and your commentary has been very upbeat in terms of your ability to maintain business in Q2, would you consider M&A as certain strategic assets came on the market?

Thank you for the question, Anna. I've been doing this a long time. I've been in the outdoor business for over three decades, and have managed through good times and tough times, and one thing that my father and my brother told me as they taught me the business is, "You always buy through the cycles." And hopefully, as we recover, I know one thing that we will emerge as one of the strongest players in the industry, if not the strongest. Hopefully opportunities will come our way. So stay tuned.

Great, thanks so much.

Thank you. Our next question will be from Stephan Bisson from Wolfe Research.

Good afternoon. Thanks for all the commentary. It was amazingly comprehensive. Two questions for me, I guess, the first is, on the Q2 trend and in May, you said things got a little bit worse. Is it significantly worse, or is it just directionally a little bit further down, and then your early commentary on June? And then, I know you guys have a lot of Middle America, how is the oil patch fared, given all the troubles in that industry as of late?

Sure. Good questions. So, the oil patch is going to struggle, and the color and commentary there is in places like Tulsa, and Oklahoma City, and Midland Texas. The macro is challenging and difficult, and that is just something we're going to have to manage through. So, the way our business unfolds in selling for the period to make the period, you've probably heard me say this before, when we're 30 to 60 days out from a month, that's when most of the activity goes into that month, right? So, the world shut down in April just means that a little more of the impact was felt for May. Now we're selling in the month for the month in May as we speak. And we believe we are going to have net new business for May as the month progresses. That said, we think that May will be -- I would categorize it as a tad worse than April, not dramatically. Don't want to get into June yet, but I have hopes that as we're writing business in May for June, June can pick up. So, I don't to guide to the quarter, but we certainly don't see it as dire as some of the analysts had.

Understood, and then, one follow-up, how is programmatic faring, is that something that can really help out in an environment where you are doing so much selling that's closer to the air date?

Yes. So, that is a really good question, and I'm going to kind of broaden it a little bit because it's axiomatic in our business that the shorter the cycle, the quicker a downturn but also the quicker the bounce, right. Programmatic is our shortest cycle business. It's a -- in many instances, it's a nanosecond. So, programmatic are hit pretty bad in April. Now, there were two reasons for that. Number one, it's extremely short cycle, but number two, it's the only channel wherein we guarantee impression, right. When we sell a bulletin on the interstate for the month, there's lots of data around the traffic who's driving by, what the demographics are, but we don't guarantee a set number of impressions. In programmatic, we do and in April, we could not do that. I'm happy to report that as of, I believe tomorrow, we're going to have data that allows us buy inventory -- buy digital inventory to guarantee impression, and the programmatic activity has really picked up, and so, we are going to see a lift from that in May, and I believe as we progress through the year. So, good question. To broaden it out a little bit, digital is -- broadly speaking is our next shortest cycle sale and it took a bigger hit in April than the rest of our platform and we see it also coming back faster. I didn't mention one little green shoe that I should have talked about, which is political. Political for the back half, Qs three and four is pacing up 32% from the 2018 cycle.

Well, thank you so much.

Thank you. [Operator Instructions] Your next question will be from Benjamin Swinburne from Morgan Stanley.

Thank you. Hey, Sean. Good morning.

Hey, Ben.

I'll take it from you, guys. I have two questions, and I know there's no way to really know or have confidence in the first one, but when you think about the business coming out of this, and I know the timing is unknown, but also trying to just get a sense for how this feels to you and the team relative to '08/'09 in terms of the recovery. I mean, one of the things that was -- I think I'm sure you share the frustration. It was an okay recovery, but it wasn't -- we didn't have the kind of snapback last time and I know this is -- again, it's an unknown, but the business has changed a bit or maybe a lot since then. I'm just wondering if you could share your thoughts on that. And then, I'd also love to know -- and this is probably a Board decision, but how are you guys thinking about the dividend versus leverage, like what's the balance there that you're trying to strike?

Sure, great questions. So, '08/'09, of course, I was the Chief Operating Officer of the company back then. And I will tell you that for six months, I walked around with a feeling of dread and a pit on my stomach. It's just --

I work at Morgan Stanley, so you can imagine how I felt.

Yes. So, I say that to sort of highlight that I have not felt that way throughout this. It does not feel as it felt back then almost existential. There's a couple of reasons for that. Our scale is bigger, our platform is broader, our inventory is in more demand, our balance sheet is far, far better. If you recall, we went into that thing levered at about 6 times and we had to scramble and they were running around getting covenant relief and all that stuff. And it was just of a much more difficult time. It is hard to predict the rebound in terms of, is it a V, is it a U, is it an L, but I'll go back to some of my commentary at the beginning. I have no doubt in my mind that car travel is going to pick up dramatically. There are going to be far fewer people flying. That overseas vacation is going to turn to a trip to the Grand Canyon for most of the family in the country. It doesn't make me feel good to say this but far fewer people in the major metros are going to take mass transit. We don't know exactly how that's going to affect commuting patterns, but by all indications, there's going to be more cars on the road and more people driving by our billboards. That makes our space more valuable.There are some other trends, I think, that are going to be sped-up in terms of secular tailwinds for us and headwinds for others in the media business. There's going to be more cord-cutting, there's going to be more over the top, there's going to be more streaming, there's going to be less watching a linear television. I think that's going to accelerate the trends that affect network affiliate local TV and, to the extent, their advertisers move away, they're going to come to us. It doesn't make me feel wonderful to say that local newspapers are going to get crushed by this. That trend is also accelerating and to the extent, their advertisers come our way. That's going to benefit us. So, in terms of secular trends, and it's hard to say how long it's going to take for these to materialize, but it's pretty clear that that's the way that the wind is blowing, and it's going to be at our back. The --

Dividend leverage? Yes.

Yes. So, obviously, the Board is going to primarily look to two things as they mull over not just the second quarter -- plans for the second quarter distribution but the rest of the year. Number one, we will maintain our REIT status period. So, as you know, we don't know what our year-end NOI is going to be, but it is our intent to distribute at least 90%, probably 100% of it, and right now, it seems to us that that will be in cash. As you know, a lot of REIT in very, very, very tough times distribute stock in lieu of cash. You've seen that among a number of the REITs particularly in the lodging space already. We don't believe we need to go there in terms of distributing stock, but number one, protect your status as a REIT and we will do that. And then, number two, it's the liquidity of the company. So we'll just have to see what the world looks like at the end of May for the second quarter distribution plan. And we believe, by August, we'll have visibility enough to speak to it for the rest of the year.

Thank you very much.

Thank you. Our next question will be from David Miller from Imperial Capital.

Yes. Hey, guys. Jay, two questions for you, and then, Sean, maybe you want to chime in. I hope everyone's safe over there. Thanks for conducting the call today. So, on the 8-K that you filed in April where you pulled guidance, you had some phraseology in there talking about ground leases and the potential for renegotiating some of the ground leases. Maybe you guys can just update us on that. And then, I just want to know if you guys are thinking about this the right way. The fact that you guys cut your CapEx to $58 million and not zero means to me that you're sort of struggling between the choice of cutting CapEx, the bone, and still maintaining the dividend at $4, recognizing, of course, you've already paid $1 of the $4, or curtailing the dividend and maybe using that free cash flow to invest in the future. Am I thinking about that the right way? And then I have another follow-up. Thank you.

Sure. I'll hit the capex question and the real estate portfolio question. So, capex first. I wouldn't read too much into that, David. We had -- given that we had to take these measures at the end of the first quarter and that the first quarter was already out the door, we spent about $26 million in the first quarter. So, the $58 million being for the full-year, you can just sort of glean that it's cut pretty deeply. We have some projects that we were contractually obligated to complete, particularly in our logo division under our contract with state highway departments. We have certain capex requirements, those that we cannot put off. We had some work-in-progress on the digital side. We have a really great relationship with the now Las Vegas Raiders and are building signage all around the new arena in Vegas. I can't wait to show that off one day. That's an example of one-off the projects that we had to go through with. We had a few little construction progress -- projects on some of our buildings around the country. So, really it's -- I would categorize it more as work-in-progress, remaining CapEx for the rest of the year rather than what we're trying to glean on the distribution.Regarding our lease portfolio, so we were very successful in 2008-2009 in cutting costs in our lease portfolio that it takes two primary directions, number one, we actually take down units that are not necessarily productive and eliminate that lease cost altogether and in some cases where, for a variety of reasons, these costs have been elevated, we renegotiate. And so, between those two activities and relief from our minimum annual guarantees on the transit and airport side, we think we're going to save about $13 million through the end of this year.

Okay. And then, I'm happy to hear you sort of talk about your gut feeling that people are going to hit the road this summer, and maybe eschew that trip to whatever Hawaii or Cabo or Europe or what have you. As you know, we've been writing about that extensively over the last six to eight weeks or so. And we obviously agree. I guess, I want to just ask you how do you know that, is that more of a gut call just based on your experience of having done this so long or is there certain data that you can cite for us on the call today that will give folks comfort that the volume of cars out there in North America is just going to be probably at a record versus any other time. Appreciate the commentary. Thank you.

Sure, David. So, yes, there's some conjecture and gut in that, but there's also some good solid data. I would really encourage you to go to our website as we speak and go look at the traffic activity highlights in our Investor section on our website. It will astound you how many people are on the road as we speak. We've got markets. These are smaller markets. They're rural markets where traffic is up 40%, 30%, 22% 19%, 14%. It's a little bit astounding as I said, and that's today, that's today. Go look at it. It will really open your eyes. The headline number, as I mentioned, is that in markets that collectively contributed 80% of our billboard revenue last year, their travel activity in miles driven is already up to 75% of last year's average. Another little headline number, 76% of our billboards are in markets where travel activity is, at least, 80%of last year's average. I could cite you. You can ask me a market, and I'll tell you where it is with traffic as we speak, go ahead. I've got the list…

Grand Canyon, how about the Grand Canyon? Grand Canyon is not there. Thank you very much. Appreciate it.

Yes, yes, yes.

Thank you very much. Appreciate it.

Yes.

Thank you. Our next question will be from Eric Handler from MKM Partners.

Yes. Good morning and thanks for the question. Wondered if you could talk a little bit about political, I was surprised that you said pacing was up 32% from the 2018 cycle, given what happened with the Democratic primaries. So, I'm just curious what's been driving the strength in political.

That's a good question. So, number one, the book built very, very quickly in the first quarter and Q1 political was up dramatically. The Q2 was shaping up to be better than the '18 cycle, but that have hit the pause button and that's probably the effect of the Democratic primary, so that would have been felt as we sit today. So what I'm quoting you is Q3 and Q4, and there's -- it's that time of year when September and October roll around. That's when the gloves come off and the political battle start. So we anticipate having a good political season.

Great, thank you very much.

Thank you. I'm showing no further questions at this time.

Well, great. Thank you all for listening. Stay safe and we look forward to visiting in August.

Thank you. Ladies and gentlemen, this concludes today's teleconference. You may now disconnect.