Excuse me, everyone, we now have Sean Reilly and Jay Johnson in conference. [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 impacts and effects of general economic conditions, including inflationary pressures 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 fourth quarter 2025 earnings release and in its most recent annual report on Form 10-K. Lamar refers you to those documents. Lamar's fourth quarter 2025 earnings release, which contains information required by Regulation G regarding certain non-GAAP financial measures, was furnished to the SEC on the Form 8-K this morning and is available on the Investors section of Lamar's website, www.lamar.com. I would now like to turn the conference over to Sean Reilly. Mr. Reilly, you may begin.

Thank you, Angela. Good morning all, and welcome to Lamar's Q4 2025 Earnings Call. We ended 2025 with encouraging sales momentum with both local and national delivering growth in Q4 despite a challenging political comp in October. Excluding political, revenues grew more than 4% on an acquisition-adjusted basis in the quarter. We delivered increases across both analog and digital billboards as well as in airports and logos. Our revenue growth, combined with solid discipline on expenses, allowed us to exceed the top end of the revised full year AFFO guidance that we provided in August. The sales strength continued in Q1 and pacings for the balance of this year remain promising. Based on those pacings and as noted in the release, we anticipate full year AFFO to be between $8.50 and $8.70 per share representing year-over-year growth of 4.1% in AFFO per share at the midpoint. The midpoint of the guidance also implies revenue growth of approximately 3.5% on an acquisition-adjusted basis, with expenses increasing approximately 3% on that same basis. Expense growth should taper as we get to the back half of 2026. I would also note that the midpoint of the range implies consolidated operating margins of over 47%, the best in the company's history. In the meantime, back to Q4, categories of strength included services, health care, building and construction and financial, while telecom and beer and wine were weaker. For the quarter, local was up 1.7%, while national/programmatic grew 3.3%. This is the third consecutive quarter that national has been up. We had a real nice pharmaceutical buy that helped the health care category and boosted national's growth. Programmatic was again strong, up approximately 19% year-over-year. Excluding programmatic, national's growth was 1.5%. As mentioned, political was a headwind in Q4 and for the full year, but…

Thanks, Sean. Good morning, everyone, and thank you for joining the call. We had a solid fourth quarter and are pleased with our results, which exceeded internal expectations across revenue, adjusted EBITDA and AFFO. Growth in AFFO continued in the fourth quarter. Diluted AFFO per share increased 1.4% to $2.24 versus $2.21 in the fourth quarter of 2024. In addition, the company ended the year above the high end of our revised AFFO outlook, driven by outperformance in December with acquisition-adjusted revenue growing almost 6% and acquisition adjusted EBITDA increasing 13.5% during the month. Operating expense growth decelerated in the fourth quarter with adjusted EBITDA margin remaining strong at 48.5%, an expansion of 40 basis points over a year ago. Adjusted EBITDA for the quarter was $288.9 million compared to $278.5 million in 2024, which was an increase of 3.7%. On an acquisition-adjusted basis, adjusted EBITDA was up 2.1%. Also in the quarter, depreciation and amortization expense decreased $151.3 million, returning to a more normal level. As you may recall, in the fourth quarter of 2024, we revised the cost estimate included in calculation of the company's asset retirement obligations, or ARO. ARO accounts for Lamar's obligation to dismantle and remove over 71,000 billboard structures on leased land and restore the sites to original condition. We test our ARO estimate annually and the cost to retire these assets rose substantially in 2024, which led to an increase in our depreciation and amortization expense during Q4 2024. As a noncash item, this has no impact on the company's adjusted EBITDA or AFFO. For the full year, acquisition-adjusted revenue increased 2.1% to $2.27 billion compared to $2.22 billion the prior year. Operating expenses grew approximately 2.6% and adjusted EBITDA was $1.06 billion, which represents an increase of 1.4% on an acquisition-adjusted basis.…

Thanks, Jay. And as Jay mentioned, we had an exceptional holiday season with December's pro forma growth hitting almost 6%. And ex political for Q4, we grew 4.3% pro forma. In terms of regional relative strength and weakness, our Atlantic and Southwest regions showed relative strength in Q4 with our Northeast region showing relative weakness. In Q4, digital grew to 33.7% of our book of business. For the full year, it grew to 31.6% of our total revenues. We are still at what I would call peak average annual occupancy. So the gains that we saw throughout the year and we will be seeing in 2026 are primarily coming through rate. As I mentioned, we ended the year with 5,553 digital units in the air, an increase of 111 over Q3 and an increase of 559 over year-end 2024, with approximately 320 of those being internally deployed and the rest through acquisition. And as I mentioned, on a same board basis, our digital billing grew 3.7% in Q4. With the help of a strong programmatic platform and that pharma buy, National had a strong Q4 and represented 22.4% of our revenues, the high watermark for the year. And as mentioned, programmatic grew 18.7% in Q4. Regarding categories of relative strength and weakness, I mentioned and called out service, health care and financial, buildings and construction, services being up 12% in Q1, health care up 13% in Q1; financial up 17% -- I'm sorry, Q4 for all of those and building and construction up 16% in Q4. For the full year, services were up 10%, health care up 6% and financial up 10%, building and construction up 16%. Categories of relative weakness, telecommunications, down 10% in Q4. Beverages, beer and wine down 20% in Q4, similar numbers down for the full year. I would note that it's nice to see that our largest verticals, that being service and health care are also among our healthiest. For a point of reference, telecom represents about 2% of our book. Beverages, beer and wine represents 1.5% of our book. Conversely, services represents about 19% of our book. Health care represents 10.5% of our book. So again, it's nice to see our largest verticals are also among our healthiest. With that, Angela, I will open it up for questions.

[Operator Instructions] And we'll go first to Cameron McVeigh with Morgan Stanley.

So Sean, I was curious your view on the state of the macro in the U.S. ad market as we're nearly 2 months into 2026. And then secondly, it sounds like a strong start on the M&A front. Curious how multiples are trending in the private market. And if you have an expectation or goal for the amount of acquisition spend over 2026.

Yes. So on the acquisition front, to start with, it looks to us like we'll do at least as much as we did last year on the cash acquisition side, which was close to $200 million. I'd say that's a realistic goal for this year given what we're seeing. And multiples are basically where we talk about them year in and year out. Because of the synergies we can bring to bear, the multiple from the seller's point of view might look something slightly below the mid-teen-ish range. But by the time we bring our synergies to bear, it's something between 10% and 11% going forward for us. And that arithmetic is holding up out there. We're seeing a good ad spend climate for 2026. You've got some good things going on. Of course, we mentioned the political tailwinds this year, but you also have some additional spend in and around World Cup venues. We expect to pick up some of that. We are optimistic about where pharma is going to come in this year, and that's a pardon the pun shot in the arm for us. So yes, we feel good and pacings look good.

Our next question comes from Jason Bazinet with Citi.

I just had a question on the decision by Clear Channel to sell themselves. I guess if that acquisition ends up going through, do you think that has any potential M&A implications for you to peel off some of their assets? Or would you view that as unlikely?

I would say, number one, just in terms of structurally for the industry and strategically for how we're positioned and their position, we don't see any change in terms of what it means for the industry. Scott and his team are going to stay in place. So from that point of view, I think as they get financially more healthy, that's a good thing for the industry. Looking at the structure of the go private and the work that they're going to do to shore up the balance sheet as they do that, it looks to us like they don't need to sell assets to delever. So I would put it as in the probably not likely category for now. They may, for strategic reasons, decide that some markets don't fit their profile. But for now, I would call the whole transaction sort of steady as she goes for the industry.

Our next question comes from Daniel Osley with Wells Fargo.

How should we think about acquisition-adjusted growth in Q1 as a starting point after the strength you called out in December? And how do you see the growth cadence playing out for the full year?

Good question. I think it's going to be one of those years where Q1 comes in maybe a tad below where the guide implies and then we pick up momentum as the year moves on. That's what the pacings are indicating. And I would also note that traditionally, political breaks late. So the fact that our pacings for the time being actually are showing that the guidance is a tad conservative. It may also be conservative given what we're anticipating political may do. Again, the political has been relatively easy to predict at the end of the year, but at the beginning of the year, given that it breaks late and the campaigns happen in September, October, November, again, the good news is it's not reflected in our pacings right now. So it can only get stronger as the year progresses.

That's helpful. And maybe a quick follow-up. What are your expectations on local versus national for the year? And can you help us to quantify the benefit you'll have from the World Cup this year?

So when you look at Lamar's footprint on the World Cup, we're not as well positioned to say OUTFRONT or Clear Channel, but we'll get our share. So we're anticipating, let's call it, $3 million to $4 million in incremental World Cup business. It's nice, and it's certainly going to help those local markets that have World Cup venues. We're feeling good about national. We've had a tough past few years until recently last year with our national book of business. Some of the verticals that were 2 years ago, a drag are now coming back in. I would highlight insurance, for example. So we're very positive on what's going on, on the national front. And of course, to the extent pharma comes in, in Q1 or 2, that's a lift that we didn't have last year in the first half.

We'll go next to David Karnovsky with JPMorgan.

On the 3% cash OpEx growth, I think that's a little above the kind of 2.5% traditional increase, Sean, as you termed it. Should we think about that delta as largely driven by the ERP? And can you just update on where you are in that process?

Sure. I'll let Jay hit the ERP. But yes, some of it is the ERP. Some of it, though, is also health care. There's no question, but that health insurance has inflation that is running a little hotter than the rest of what happens on our expense side. It's about 0.5%. So the difference between 2.5% and 3%, you can look at it as somewhat being fed by the -- what's going on in our health insurance costs and again, somewhat driven by ERP, which Jay can hit.

Yes. And it's been driven by ERP over the last couple of years. This year, that will moderate as we look to go live later this year with the second phase of our technology initiatives. From a corporate perspective, because of that, expenses have kind of normalized a little bit and should be -- corporate expenses should grow below 2% this year. I would reiterate the health care expenses. It's been quite a headwind for us over the last 3 years or so, you're talking high single-digit growth on the health care line with very little ability to foresee it or forecast it. So that's one that continues to plague us on the expense line.

Okay. And then, Sean, you mentioned pharma several times. Maybe just you could speak broadly to where you are with the vertical or where you stand also with just bringing on some other nascent national categories as well.

So yes, so the pharma story is a good one, and it's good for the industry, by the way. The basic driver is, number one, a change in FDA rules around disclosures that pharma is required to do for their advertising of drugs. Essentially, if you don't say what the drug is going to cure, then you don't have to do all the disclaimers of the possible side effects, which means you can say the name of the drug, you can say the name of the drug company, have pretty pictures and then say call your doctor. And that essentially opened up our medium to be an effective voice for pharma. They also have a data set that proves out their campaigns. They use a company called Crossix to prove out campaigns across all media and Crossix has developed a way to do attribution studies for our media, which again has helped pharma prove out the efficacy of using us to get their word out. So yes, that's a good one, and we have high hopes that it can move the needle.

[Operator Instructions] We'll go next to Jonnathan Navarrete with TD Bank.

How much of a benefit are you expecting from political in terms of dollars? And how does that compare in terms of -- when you compare it to a presidential election year? And my last question is, should we expect most of the benefit from political to come in the third or fourth quarter?

Yes. The answer to the last part of the question is yes. Like I said, it typically breaks late. It doesn't show up in our pacings until the -- really and truly until the back half. In terms of the delta, one way to look at it is the difference between '24 and '25 was a little less than $20 million. So that's one way to think of it. That -- of course, '24 was a presidential year. And so I wouldn't anticipate quite that much. And so something maybe conservatively around $12 million, $13 million, $14 million in incremental this year political over last year's political.

At this time, there are no further questions in queue. I will now turn the meeting back to Sean Reilly.

Again, thank you all for your interest in Lamar, and we look forward to getting together again for the Q1 call in a few months. Thank you, Angela.

Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.