Great. We'll go ahead and kick things off. For those who don't know me, my name is Daniel Osley. I'm an analyst at Wells Fargo. I have the pleasure of welcoming Sean Reilly for our next fireside. President and CEO of Lamar Advertising. Thank you, Sean. Yeah. Thanks for having me, Dan. Appreciate it. Great. Maybe starting with an industry question. Out-of-home has been pretty stable over the years at about 2%-3% of the total US ad market. Over time, do you expect the industry to grow its share of the pie? What do you view as the drivers of unlocking that upside? Yeah. Good question. I'll start with Lamar is 80% local, right, and 20% national, meaning that I think a lot about what's going on with the share of the pie at the local level. When you look at the local level, virtually every other traditional media is struggling with their audience, right? Whether it's newspaper, we know the story there; radio, we know the story there. Increasingly, local network affiliate linear television is having its challenges. Now, look, we're not going to get all of that that might move away from them, but just getting a little really can rock our world. I would start with that. There are clear—you can draw a clear line from the demise of a local medium and a vertical that increases their spend with us. The obvious example would be, 20 years ago, attorneys owned the Yellow Pages. There are no more Yellow Pages, and now they buy a lot of billboards. That is going to continue, and that is going to be a tailwind for us over the next 3, 5, 10 years. That's helpful. Both you and your peers are seeing a strong uptick in national advertising. What do you think is driving the re-engagement of large advertisers, and what's changed from the conversations you're having around this time or at this point in time versus the conversation you were having last year around this time? Yeah. I would start with the vibe going into 2026 is just much more pleasant than the vibe going into 2025. The chatter is all good. The talk of what large advertisers are expecting to do next year, it just has a stronger tone and tenor than it had going into last year. What's changed? Number one, you've heard me say many times there's a bigger Beta in what happens with national ad spend than what happens with local ad spend. What's gratifying is, for whatever reason, if a vertical decides to soften up on us, let's call it auto, which did, auto insurance, now they're coming back in. That means that it wasn't us. It was just how they felt about their world and their ad spend, and now they're coming back in because they kind of ebb and flow. Now, one thing that I would say has changed is the number of third-party data providers that can help, in particular, national customers feel good about their spend. I'll use the example of pharma. We just got our first-ever very large, meaningful pharma buy, and it came down in no small part because their trusted third-party data provider, CrossX, got them comfortable with what they wanted to do with us. I think that has changed over the last, what, two, three years. Maybe going back to your point on the cyclicality or the Beta that you see in national, do you think this upswing that we're seeing right now, is there anything structurally different about this time with national recovering, or are you seeing evidence that supports national maybe being structurally stronger for a longer period of time? I have been doing this longer than I like to think about. And over the last three decades of my career, we have been 80% local and 20% national the whole time, right? So around that, you have the swings in national, and local tends to just be sort of real steady. But you can have that beta where if you smooth it out, you're still seeing an upward trajectory, right? The math is what the math is, right? If you're 80/20 for 30 years, then they're essentially growing at the same rate. And there will just be a moment in time where sometimes local seems stronger, and there will be a moment in time where sometimes national seems stronger. We're in the moment in time now where national seems stronger. That's helpful. Part of that strength in national is also being driven by the programmatic sales channel that you all have been investing in. Are you seeing evidence that that channel is pulling in new advertisers to out-of-home? Yeah. I mentioned auto insurance, right? They are heavy users of programmatic, and I think that has played a role in enticing them back in. I could answer it by saying maybe not new, but a welcome return because we have the channel, and they may not have spent as much if we did not have it. Now, other programmatic customers are absolutely net new, would not use us at all if we did not have programmatic. That is primarily because they are digital specialists. They do not pick up the telephone and give you a call. They want to buy through an algorithm, period. We have to make that algorithm available to them. It is my understanding that your programmatic business is all national. What would you need to see to open that capability up to your local clients, and how would you frame the potential benefits from making a move like that? Great question. We're actually Beta- testing an automated buying platform for local customers in three markets as we speak. Now, it's not full-blown programmatic like we make available to our national customers, primarily because our local customers aren't really asking for that, but they do want a self-service platform where they can go into their office, open up their computer, see avails, see pricing, get some rudimentary demographic information, put together their own campaign, and then hit a button. That's what we're experimenting with. Again, it's not what I would call the full-blown algorithm-driven programmatic, but it is impression-based buying that is self-service, which is our sophisticated local customers. That's where they want to be. Going back to a comment you made, in the third quarter, you saw your largest pharma buy ever, and I couldn't help but notice that it also coincided with the launch of your Health Connect solution. Can you talk a bit more about that tool and what benefits it's providing to pharma brands? Sure. I mentioned CrossX, and that's a big part of it. What is also a part of it is we are not waiting for their agency to figure us out. We have a team that's dedicated to going direct to the customer around the agency and arm in arm with CrossX and saying, "We can do this for you. We can sharpen your buy. We can prove out inventory to you that is most likely to hit your target audience in a way that we couldn't before." That is what that is at its core about, is being able to go direct to pharma, go to their conventions, talk to them in a way that we really couldn't before. We're showing some early wins. With this one specific buy, do you see this as an opportunity to maybe act as a proof point for other pharma buyers or some of the other competitors of that specific advertiser to open up their spend out-of-home as well? Yeah. No question. That's a common phenomenon, right? Once one respected company in a particular vertical decides that we're going to go this way, then others follow. We're in front of them. Great. Do you see any other ad categories where maybe a similar vertical-specific measurement solution or tool could also help to drive growth? I think increasingly, customers are going to not necessarily look to our industry to provide all the measurement solutions. There are third-party vendors that are trusted by different verticals really popping up everywhere, right? The quick service restaurant guys may want one type of data point to prove out their campaign, whereas I mentioned pharma might want one, auto might want one, tech may want a different one. I think as an industry, number one, this is an increasingly accelerating phenomenon, which is good for us. Number two, I think it takes a little of the pressure off of the industry to necessarily get every aspect of measurement correct because we've struggled with that. As you know, we have an industry measurement organization called Geopath, and it's been tough for Geopath to keep up in an ever-changing world. We are working as an industry to get the baseline data correct at Geopath and then let our customers take whatever other data they want to overlay and use that. That is where the industry's going, and it can only be good for us. Is this vertical-specific data, is there any cost with integrating that within your programmatic capabilities, and is your programmatic system already set up to easily plug into some of these things? Yeah. Programmatic is plug and play. There is a menu. It is almost like a drop-down menu. You can pick whichever one you want and use it on top of the Geopath data. In the pharma example, the CrossX expense is a pass-through. The customer actually is paying for it on a campaign-by-campaign basis. It is not that expensive. I mean, within the realm of the overall buy, it is very reasonable. Maybe going back to the point on Geopath, can you talk about your expectations for the industry measurement standard to evolve over time? I know one of your peers has been speaking about potential optimism on 2026 and 2027 in terms of an overhaul to that system, but can you speak to what you're seeing on Geopath? Yeah. You're referencing Scott Wells, who runs Clear Channel, and he has been very engaged and doing a great job. He's the new chairman of the OAAA, and he took my place a year and a half ago. He's been very engaged in this and doing a good job. We are hopeful that we can take Geopath and have its data be trusted and baseline, and then again, build on it with third-party data, right? I think if we get that right, our customers are going to be really open to that model. They don't mind paying for it if they trust it. Do you see this as more beneficial to local or national advertisers? It seems like maybe the bigger advertisers at first are where this could be targeting. From a local perspective, with some of the linear medium degradation that we've talked about in the past and some of the search disruption that we've seen, is there an opportunity for the program you have on the programmatic side to move to more an impression-based buy and get more sophisticated with your local advertisers? Yeah. I think so. In general, our local customers, they live in the place where they're advertising, and they know who's driving by their billboard. Oftentimes, they're anchored to a specific geography within a DMA, and they want to talk to the customers in the zip codes that are likely to stop at their store or their dealership. We're perfect for that, right? They don't have wasted circulation by buying the whole DMA. They can just buy us and target geographically with great precision and target demographically with just intuitive feel for who they know lives in the neighborhood. That's primarily why local customers have a lot of faith in us without necessarily having to have a lot of data. That's helpful. On local and national trends, it does feel like more recently we've seen a bit of a bifurcation with national strengthening here. Can you give us some more detail on what you're hearing from local advertisers and whether you're starting to see any green shoots there? It is 40,000 customers touched by 1,000 account executives. It would be extremely anecdotal, but I can speak to my pacings, right? The pacings are going to be the best mathematical expression of how it is looking going into next year. I can say our pacings for 2026, these are contracts in hand, right? This is business that is in the books. As we sit today, peering into next year, our pacings are markedly stronger than sitting in this same day last year looking into 2025. That just gives me a good feeling about how 2026 is going to shape up. Because again, those pacings, they are going to be 80% local. Speaking of 2026, what do you see as generally the biggest drivers of top-line growth next year? We have politics as a tailwind instead of a headwind. To sort of put that in some arithmetic around that, this year we did, round numbers, $10 million. In 2024, we did, round numbers, $30 million. Your delta there is about $20 million. Now, 2026 is not a presidential year. Our team is expecting something in the neighborhood of, let's call it, $25 million. The delta, the tailwind, is about $15 million, which is nice. We have the World Cup, which is going to be a nice event. It is not huge given our geography as opposed to what Clear Channel or Outfront might experience, but it is something. I mean, our team is saying, "Sean, you should expect a lift of $3 million-$4 million-ish around the World Cup." We report as-reported numbers and same-store numbers, acquisition adjusted. Because we did, give or take, $300 million in acquisitions this year, our as-reported numbers are going to be pretty gaudy next year. I mean, they're going to be nice. If your focus is AFFO per share, it's more than a few pennies of creative to our AFFO per share. Got it. I know in the past you've spoken about having a percentage of your full-year budget booked at specific periods of time. I guess as we look into 2026, as we sit here today, what visibility do you have into the full year? It's somewhere between 45 and 50. When we turn the corner into January, it'll be something between 55 and 60. It's not a perfect crystal ball, but it's a good indication of how the year should shape up. My team hears me say this a lot, and y'all have heard me say this a lot. You have to sell in the period for the period to make the period, right? Whether that's the month, the quarter, or the year. You still have to keep your selling intensity up. You have to keep your shoulder to it. In general, I feel like we've got a lot of reasons to feel good about 2026, for sure. Maybe going back to political, right now, out-of-home broadly gets a very small piece of the total political ad market. I wanted to ask, do you see any opportunities to pick up or to grow your share of total political advertising over time, specifically as you all get more digital and as programmatic becomes a larger piece of the pie? Yeah. That's a good question. Sometimes I hate talking about political because it is not a lot of dollars, and I don't like for us to be considered an ex-political medium like radio and TV because I just have never viewed us that way. It is becoming a more meaningful part of what we do. I think that is because of digital. If I go back 20 years, most of our political was hyper-local. I'm talking city council races, mayor's races. A lot of them used our medium simply for name recognition, right? Because you can't use it tit for tat, but digitally, you can, right? We're finding that with being able to respond to your opponent in real time through digital makes us more attractive to the way campaigns are run these days. We are going to get more of it the more digitized our inventory becomes. There is just a lot more money being spent. I mean, there is seemingly an endless amount of money to be thrown at campaigns. Increasingly, it is not the candidates themselves. It is third-party PACs and advocacy groups. Yeah, I think your instinct that we are more responsive now, so consequently, we will get more is right. That's helpful. How much of the political dollars that you all pull in today are local versus national, roughly? It's still predominantly local. I would say 95% of it that comes in is coded local. For example, even though you kind of think of a U.S. Senate race as a national race, I mean, you're running for Senate in a state. That's going to go down to one of our local markets. They're going to handle the buy. It's going to be local. Okay. That makes sense. As we think about forward EBITDA and AFFO growth, can you walk us through some of the major puts and takes when it comes to expense growth next year? Sure. I think it's going to be a good story next year for a couple of reasons. Number one, we're finishing up a huge ERP conversion. Some of that OPEX is going to go away about halfway through the year. Number one. Number two, the top line is going to grow faster than it did this year. I think what you're going to see is a GDP+ top line on top of a more traditional Lamar-like 2.5% expense growth. I'll be disappointed if the margin improvement doesn't take us into something N orth of 47%, which will be the first time consolidated we'll have ever gotten there for a full year. I think the story is good on margin expansion on EBITDA growth. When you get to AFFO per share, as I mentioned, you'll have all that arithmetic, and then you'll also have the accretive acquisitions that will add to that number. If that's the number you track, it should, all things being equal, be a really good year. As you know, we have to distribute the bulk of that AFFO per share, so our distribution should likewise go up. Yeah. Do you have a North Star? Do you have longer-term EBITDA margin goals? I guess how should we think about the longer-term growth algorithm, specifically on the top line? As you mentioned, more GDP+, but on cost, is it kind of the 2%-2.5%? Is that a reasonable range to think about on a normalized basis? Yeah. I mean, I'll put that number out there. I'll be disappointed if we don't do better. I mean, there is the promise of some expense savings from this ERP conversion. There's the promise of some expense savings from the adoption of AI tools, whatever they might be. If by 2028, we're not a point to a point and a half better than where we sit today, I'll be pretty disappointed. I'd like to have a 48 in front of it. We don't, and I don't think anybody really knows what AI is going to do. As I said on our earnings call, we know it's good at words and pictures. That's what we do, is words and pictures. It can't help but be good for us, right? You mentioned the ERP conversion that I know has taken some time, and it does take time and money to get these things right. Once you've fully completed that, I guess first, when do you expect to start to be on the back end of that? How should we think about the potential benefits or savings that you should see from that program? Yeah. July of next year, as I'm fond of saying, we're going to kick all the consultants out of the building. You should see our OpEx normalize at corporate because, as you know, that's been running a little hot because of this. The benefits, the way I like to think about them, is not so much around headcount, but it's a more efficient sales process that results in more client touches, better client touches, more tailored client touches, which should result in more business. Over time, it's going to allow us to scale without adding headcount. I mean, I can envision a three- to five-year future where we spend well over $1 billion buying extra inventory through internal conversions and acquisitions, adding a couple of thousand digital units. That increases the velocity of art and proposals that we need to generate. We'll be able to keep up with that velocity without adding headcount. It will allow us to scale with the infrastructure that we have, right? You mentioned AI and AI tools earlier. Can you talk about any ways in which you're using AI today? What are some of the trials, if any, that you have going on? I mean, you have the publicly available easy stuff. Embedded in Adobe Graphics is an AI tool that helps our graphic artists be more productive. And we're doing that today. I mean, that's kind of dipping your pinky finger in. Our folks that are putting together proposals, I'm sure they're hopping on ChatGPT and helping craft whatever words they want to put into a campaign. So that's there today. But again, that's just barely dipping your toe into what I believe is going to be a very powerful tool, mainly because of not just making us more efficient. It's going to make us smarter. It's going to make us know to a much greater degree what is likely to make a client say yes because we're going to know far more about the client than we do today, right? It can't help but be a good thing from that point of view, just being able to get to yes quicker. Got it. Maybe moving to capital allocation. Given Lamar has the best balance sheet in the industry, do you see any opportunities to ramp your organic uses of capital? Are there maybe additional digital conversion opportunities? I guess, are there any other organic uses of capital that you see to maybe deploy additional capital to? What I'm telling our folks is all of the above, right? I want to go as fast as we possibly can deploying digitals. Just everywhere it makes sense, everywhere we can, everywhere we can get the right regulatory regime in place, get the right lease terms in place, let's go. There's no capital constraint there. We've got the wherewithal to do whatever we can put in place. Then there's M&A. We just reconstituted our balance sheet. We've got well over $1 billion in powder. Same story there. We're open for business on the M&A front. This year, + or - $300 million in asset value. Without a big one, I'm targeting the same number for next year. If something big breaks loose, then so much the better. On that point, can you talk about how the market for larger scale transactions is currently shaping up? Sure. There's maybe five targets that are, let's call it asset value North of $500 million. None of those are rumored to be coming available anytime soon. If you look at asset value over, let's call it $100-$150 million, there's probably a dozen of those, right? It wouldn't surprise me if something doesn't break loose in that order of magnitude, right? May even be an upreap transaction because that's a very doable size for an upreap, and you have sellers or potential sellers that fit a profile where that would be attractive to them. Maybe a dozen of those. Once you get in the below $75 million-ish, there's hundreds and hundreds, right? Of the cash transactions we did this year, let's call it $175 million worth, the average transaction size is going to be $8-$10 million, right? Just lots of little ones, so. That makes sense. From an integration perspective, can you remind us how quickly you're able to typically realize synergies from these smaller tuck-in acquisitions and how that may differ from larger transactions? Yeah. If you look at our footprint, go on our website, the first thing you're going to see is a map of the United States. You can actually drill down to the individual billboard anywhere in the country. The first impression you're going to get is, wow, they really are everywhere. Virtually anything we buy is a fill-in. Now, that's not 100% the case, but it's a lot of the times the case. Those transactions are extremely predictable. We don't need people, trucks, buildings. All we're buying is a billboard structure, a permit to be there, an advertising contract, and a ground lease contract. The magic on the expense side happens very quickly. Like I said, the synergies are very visible, and it's a very predictable exercise. Over time, we'll get synergies on the top, but that doesn't happen right away for a couple of reasons. Number one, there's usually advertising contracts in place, right? You got to run those off. They're typically going to be 6-, 8-, 12-month contracts. There's a natural rolling off of the old contracts before we can maybe raise the bar a little bit on the top line. The real take-home message is it's a very predictable exercise. It is a very accretive and good use of shareholder capital. I guess, how meaningful of an opportunity is it to maybe see some of those top-line synergies? Obviously, a lot of these smaller assets are mom-and-pop kind of operations. Are you really able to get in once some of the initial contracts roll off and use your sales force and use your industry strength or industry position to really drive top-line synergies? Yeah. That happens a couple of ways. Number one, we have access to national customers that they might not, right? There is that additional demand that we can bring to bear to help us with our pricing. It is not uncommon for them to just price under our umbrella, right? Got it. I know in the past you've talked about your leverage target staying within or below 3.5-4 times. Do you have an appetite to take that leverage higher if there were a deal out there of significantly larger size? If I had a very, very quick glide path to get it below four, yes. I think our bondholders and the rating agencies would understand because of our history and the way we've operated. In general, we've been very consistent in saying that if you're a publicly traded REIT, your leverage should be in the 3.5-4X range. You get above that, you're in not necessarily a comfortable place. That's where we want to be. Right now, we're well below that. We could do a transaction in the neighborhood of $1.5 billion and be barely at four, right, given the acquired EBITDA that we'd be getting. Plenty of powder, plenty of headroom on the balance sheet, and just need the right transaction to show up. That makes sense. One final question, thinking about your footprint, Lamar has always prided itself on being dominant in middle market locations. Given some of the trends that we've seen on the national side, do you have any desire to deliberately add inventory in some larger DMAs or markets? Yes. It has to be—this is what we've learned through programmatic. There are some very desirable zip codes that I'd like to have coverage in. It has to be not just a large DMA. It has to be the right zip code. It also has to be quality inventory. Quality, large-format digital inventory in some very desirable zip codes. Because through our programmatic channel, we can see where we're not getting wins. It is primarily because we just do not have inventory there, right? That implies top 15 DMAs. I guess, how do multiples in those markets compare to some of the other markets? I'd imagine it's relatively more expensive to get bigger in those larger DMAs? It really depends on the size of the transaction. If it's six digital units in a top 10 DMA, it could be that there's not a lot of attention there. It could be that a Clear Channel or an Outfront has enough there already and don't necessarily need to show up for this one. That would be a transaction that would be below the radar of private equity. It could be not huge inflation in trying to pull that one down. If it's a major, major player in a top 10 DMA, there's going to be other players there for sure. We just have to stay disciplined about it. Great. We'll leave it there. Thanks for joining us, Sean. All right. Dan, always a pleasure. Appreciate you. Thank you.