Lamar Advertising Company (LAMR) recently announced its intention to redeem $122.8 million worth 6 5/8% Senior Subordinated Notes due 2015. The notes will be redeemed on August 29, 2012 by Lamar Media Corp.
The redemption price has been fixed at 101.104% of principal amount. Interest accrued will be paid for notes surrendered on the redemption date.
Prior to this announcement in January 2012, Lamar Advertising made similar efforts for reducing its debt balance by repurchasing $600 million principal amount of 6 5/8% Senior Subordinated Notes. Repurchase price was then fixed at $1,005.83.
The notes comprised 6 5/8% Senior Subordinated Notes due 2015, 6 5/8% Senior Subordinated Notes maturing in 2015 — Series B and 6 5/8% Senior Subordinated Notes due 2015 — Series C.
Exiting the first quarter 2012, Lamar Advertising’s total debt, including current maturities increased to $2,187.6 million from $2,158.5 million in the previous quarter. However, interest expense dipped 8.5% year over year to $39.9 million in the quarter.
Lamar Advertising is due to report its second quarter 2012 financial results on August 8, 2012. The Zacks Consensus Estimate for the second quarter stands at 15 cents, reflecting a year-over-year growth of 27.50%. Estimates for 2012 and 2013 are at 16 cents and 61 cents, respectively. These represent annual growth of 718.18% for 2012 and 275.0% for 2013.
Lamar is a Louisiana-based leading owner and operator of outdoor advertising structures in the U.S. It gives stiff competition to its peers in the industry including Clear Channel Outdoor Holdings Inc. (CCO).
The stock currently bears a Zacks #2 Rank, translating into a short-term (1-3 months) Buy rating.
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