Excuse me, everyone. We now have Sean Riley and Jay Johnson in conference. Please be aware that each of your line is in a listen only mode. At the conclusion of the company's presentation, we will open the floor for questions. To ask a question, please press star one on your telephone keypad. To leave the queue at any time, please press star two. 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 distribution 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 first quarter 2026 earnings release and its most recent annual report on Form 10-K. Lamar refers you to those documents. Lamar's first quarter 2026 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, www.lamar.com. I would now like to turn the conference over to Sean Riley. Mr. Riley, you may begin.
Thank you, Katie. Good morning, all. Welcome to Lamar's Q1 2026 earnings call. The year is shaping up quite well for us. Our first quarter results exceeded our internal expectations on both the top and bottom lines, with strength from both local and particularly national customers. Our forward bookings are very promising. We are pacing to the top end, if not above, the guidance that we previously provided for full year AFFO per share. If that trend continues, we will need to revisit that guidance on the August call. I am particularly encouraged by the momentum on the national side, which, as you know, was bumpy through 2023 and 2024 before beginning to recover last year.
For the first quarter, national revenue increased 5.8% versus the first quarter of 2025, with programmatic growing by nearly 25% to approximately $11 million for the quarter. Ex-programmatic, national was up 4.1%. Pacings for the balance of 2026 are even stronger than that. We are seeing increased spend from some longtime national customers as well as activity from new accounts and categories. What it tells me is that in an increasingly algorithm driven world, out-of-home's ability to reach customers at scale with memorable messages at affordable prices is resonating with both big brands and local advertisers. Back to Q1. Consolidated revenue increased 3.9% on an acquisition adjusted basis, with growth across all divisions, billboards, airports, transit, and logos and across all of our regions. Our pacing suggests that revenue growth will accelerate into Q2.
For the quarter just completed, EBITDA grew by 5.2% on an acquisition adjusted basis on a margin that improved by approximately 130 basis points versus the year earlier quarter. Categories of strength in Q1 included services, restaurants, gaming, political and insurance, while education and telecom were a tad weaker. In addition to national growth mentioned earlier, local grew 3%. Digital again led the way with revenues increasing 5% on a same board basis and accounting for more than 30% of our revenue in the quarter. Rates on our analog bulletins and posters, meanwhile, showed a healthy growth of 3%. On the M&A front, we are off to an active start.
Far in 2026, we have completed 19 acquisitions for a total cash purchase price of $80 million, and we have a solid pipeline working and potential for more accretive billboard deals. Meanwhile, we have ramped up our efforts to secure easements beneath our best performing locations, and we are optimistic about what we will be able to accomplish there in 2026. That's a great use of our capital, by the way. All in all, I could not be more pleased with how 2026 has begun. With that, I will turn it over to Jay to walk you through some additional numbers. Jay?
Thanks, Sean. Good morning, everyone, and thank you for joining us. We had a solid first quarter and are extremely pleased with our results, which exceeded our own estimates across revenue, adjusted EBITDA and AFFO. The airport business led the way with acquisition adjusted revenue increasing 15.5% in Q1 versus last year, followed by Logos, which was up 6.3% in the quarter. Our billboard regions all experienced low to mid single digit top line growth, driven by the Midwest and Atlantic, which were up 5.7% and 4.8% respectively. In addition, the positive momentum continued in April, with revenue increasing 4.8%, outpacing our original budget.
April's strong performance brings acquisition-adjusted revenue to 4.1% through the first four months of the year, and we are excited about our booking pace for the balance of the second quarter. Acquisition-adjusted consolidated expenses increased 3% in the quarter, which was better than expected and should be in the 3% range for the full year. Adjusted EBITDA was $226.3 million compared to $210.2 million in 2025, an increase of 7.7% in the quarter. Improving 5.2% on an acquisition-adjusted basis. This was the strongest growth we've seen in almost two years. Adjusted EBITDA margin expanded 130 basis points over a year ago to 42.9%.
Adjusted funds from operations totaled $177.5 million in the first quarter, compared to $164.3 million last year, an increase of 8%. Diluted AFFO per share grew 7.5% to $1.72 per share versus $1.60 in the first quarter of 2025. Local and regional sales accounted for approximately 82% of billboard revenue in Q1, growing for the 20th consecutive quarter. In fact, it has been five years since the portfolio last experienced a year-over-year decline in local and regional sales, which was due to COVID. On the capital expenditure front, total spend for the quarter was $33.1 million, including $9.3 million of maintenance CapEx.
For the full year, we anticipate total CapEx of approximately $186 million, with maintenance CapEx comprising $64 million. As for our balance sheet, we have a well-laddered debt maturity schedule with no maturities until the AR securitization in October 2027 and no senior notes maturity until February 2028. We will likely extend the securitization later this year, assuming market conditions remain favorable. The company currently has approximately $3.5 billion in total consolidated debt, and our weighted average interest rate is 4.5%, with a weighted average debt maturity of 4.3 years. As defined under our credit facility, we ended the quarter with total leverage of three times net debt to EBITDA, which remains amongst the lowest level ever for the company.
Our secured debt leverage was 0.7 times at quarter end, and we're in compliance with both our total debt incurrence and secured debt maintenance tests against covenants of seven times and 4.5 times, respectively. For the full year, we expect total leverage to hover around 3 tons, with secured leverage coming in comfortably below one times net debt to EBITDA. In addition, our LTM interest coverage through March 31st was seven times adjusted EBITDA to cash interest, further demonstrating the strength of the company's balance sheet. As Sean mentioned, M&A has been active thus far in 2026. We continue to benefit from an investment capacity well over $1 billion with the ability to deploy this capital while remaining at or below the high end of our target leverage range of 3.5-4 times net debt to EBITDA.
Our liquidity and access to capital both remain strong. As of March 31st, we had just over $700 million in total liquidity, comprised of $39.3 million of cash on hand and $662.2 million available under our revolver. The company's AR securitization had $242.1 million outstanding at quarter end. Subsequent to quarter end, the company repaid $40 million on the revolving credit facility, and we currently have $40 million outstanding. Also, the AR securitization is now fully drawn at $250 million. In this morning's release, we affirmed our full year AFFO guidance of $8.50 to $8.70 per share.
Cash interest in our guidance totals $154 million and assumes no change in short-term floating interest rates for the balance of the year. As I touched on earlier, maintenance CapEx is budgeted for $64 million in 2026, and cash taxes are projected to come in around $11.5 million, which is slightly higher than our original expectations. Finally, our dividend. We paid a cash dividend of $1.60 per share in the first quarter. Management's recommendation at the upcoming board meeting will be to declare a cash dividend of $1.60 per share for the second quarter as well. This recommendation is subject to board approval, and we will communicate the board's decision following the board of directors meeting later this month.
For the full year, we still expect to distribute a regular dividend of at least $6.40 per share. On an annualized basis, the second quarter proposed dividend represents a yield of 4.5% at yesterday's closing stock price. Given the outperformance in Q1 and expectations for Q2, it is likely management will request that the board approve increasing the dividend in the back half of the year. As a reminder, the company's dividend is based on taxable income, subject to board approval, and our dividend policy remains to distribute 100% of our taxable income. We are pleased with the strong start to the beginning of the year as well as the momentum that has continued into the second quarter, and we look forward to executing on our strategy throughout 2026.
I'll now turn the call back over to Sean.
Thank you, Jay. As Jay mentioned, the strongest region in Q1 was our Midwest region, with pro forma revenue growth up 5.7%. The region showing relative weakness was our Gulf Coast region, with revenues up 1%. I would note that looking forward, all regions are pacing well at up mid-single digits. Also of note, as mentioned by Jay, our airports division was particularly strong, up 15.5%, and our logos division came in up 6.3%. Also, as mentioned, same board digital was up 5%, and digital constituted almost 31% of our billboard billing in Q1. We ended Q1 with 5,657 digital spaces, an increase of 104 over the year-end 2025.
As we have said on many of our recent calls, our pro forma revenue growth was mostly driven by rate on our static units and overall same board yield on our digital units. It also bears repeating that national/programmatic sales growth was a solid 5.8%. This was aided by programmatic's strong showing of 25% quarter-over-quarter growth. As of May 1, we were 75% booked to our total revenue goal for the year. That's the strongest laid down bookings that we've seen since COVID. I've already mentioned categories of relative strength and weakness. To that, I would add that all of our top 10 verticals are healthy and happy. There are ebbs and flows, of course, but collectively, our top 10, which generates 75% of our revenues in Q1, were up 5.4%.
Political this year is pacing well ahead of where it was in 2024 and should continue to be a nice tailwind. With that, Katie, I will open it up to questions.
Thank you. If you would like to ask a question, please press star one on your keypad. To leave the queue at any time, please press star two. Once again, that is star one to ask a question. We'll pause for just a moment to allow everyone the chance to queue. Thank you. Our first question will come from Cameron McVeigh with Morgan Stanley. Your line is open.
Thanks. Good morning, Sean and Jay.
Hey, Cameron.
Curious if you could give a You've mentioned, but a high level broader view on, you know, your view of the macro and any notable verticals that are driving this strength in the national ad market. Yeah, I know you said you expect revenue to accelerate into the second quarter, but just curious at this point, do you expect that strength to continue over the course of the year from what you can tell and how that cadence might look?
Sure. You know, last question first. Q2, Q3, Q4 are all looking very good, Cameron, and pacing at I would call roughly the same pro forma revenue growth. Regarding the first part of the question, it's really across the board. That's why I mentioned that if you look at all of our top 10 verticals, they're all doing well. You know, there are gonna be ebbs and flows through the course of the year and across years. But that top 10, as I mentioned, you know, was up 5.4%. Yeah, we're seeing health across the board.
That's great. Just one follow-up. You know, Sean, I'm curious how you're thinking about the upcoming tailwinds, including the World Cup and the midterms, and if your views have changed or evolved around the sizing of those.
I think, you know, the World Cup, that basically is in our book and it's done and it's contracted for. I'd say, in general, that's helping our national, and it's coming in, you know, give or take where we expect it. I think the surprise, Cameron, is how strong political is. You know, we were, I think, understandably a little bit conservative on our guide to that when we opened up, began the year, because it's a midterm year, not a presidential year. We are pacing well ahead of 2024, the presidential year, and, you know, assuming that continues, that'll be the first time that's ever happened.
Great. Thank you, Sean.
Thank you. Our next question will come from Daniel Ostly with Wells Fargo. Your line is open.
Thank you. Beyond revenue coming in ahead of your expectations, were there any other contributors to the margin strength that you saw in Q1? Maybe as a follow-up, how should we think about your margin expansion for the full year compared to 2025, especially given your commentary around easements? Thanks.
Good question. There are a couple of factors in there. Obviously, revenue growth helps. Recall that we lost that Vancouver franchise last year. That was essentially a no-margin business. That is now out of our portfolio and that has contributed somewhat. You know, when we layer in acquisitions, and we did quite a few of them last year, those come in at a margin contribution of approximately 65%. That also obviously is helping. We're gonna lap some of that activity as we go into the back half. I would anticipate, and I would be disappointed if we don't have at least a full point, percentage point of margin expansion for the full year.
Last year it was 46.7% and, you know, I'm looking for something in the 47.7% range, for the full year this year.
Great. Thank you.
Thank you. Again, as a reminder, that is star one if you would like to ask a question. Our next question will come from Alexei Papalexopoulos with JP Morgan. Your line is open.
Yes. Hello, good morning. Thank you. Can you discuss monthly dynamics through the quarter? You talked about massive 6% revenue growth in December, with demand cooling off in January, February. Did you witness acceleration in March, or the overall beat this quarter is largely explained by that strong momentum at the beginning of the quarter? How much of the beat was national versus local? Thank you.
On the second part of the question, I would say national was the surprise that led to the beat. Clearly we had some large buys from some large customers that were not contracted for when we last spoke, but now are on the books and contributed nicely. Also political came in better and continues to come in better than we anticipated at the beginning of the year. In general, you know, to the tone of the question, we're seeing the book build nicely as we look at our pacings for the rest of the year.
You know, I would anticipate that, by the time we get to the August call, as I mentioned in my prepared remarks, you know, we'll be looking at hopefully revising that guidance upward as we, as we go through the year.
Yeah. Can I ask one more?
Sure.
Yeah. Last year you talked about a deep pipeline of private targets across various size ranges, and the Verde up-REIT transaction was clearly well received. With the stock where it is today, we would expect you to be very interested to do such deals. Are you seeing seller interest in the up-REIT structure today?
Good question. Yes, we are. We've had several inbound inquiries, we're hopeful that we could get a couple up-REIT deals done this year. It's a very, very attractive structure for sellers. It's very tax efficient. Of course, they get to hitch their wagon to Lamar, diversify their exposure to out of home and we've been a good bet so far.
Great. Can you remind what's embedded in the full year guidance for AFFO with respect to acquisitions that you have completed in first quarter already?
When we guide to AFFO, I'll punt that over to Jay for a second, but when we guide to AFFO per share, we don't anticipate layering in acquisitions.
Yep. If you think about acquisitions from a top line pro forma growth, it's probably adding 20-25 basis points this year from an actual versus pro forma.
Thank you.
Thank you. This concludes our Q&A session. I'll now turn the call back over to Sean Riley for any final or closing remarks.
Well, thank you all, for your interest in Lamar and for joining us on the call. We look forward to another good call in August.
Thank you. That brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.