Lamar Advertising Company Announces Fourth Quarter and Year Ended December 31, 2023 Operating Results

Lamar Advertising Company

Three Month Results

• Net revenue was $555.9 million

• Net income was $149.3 million

• Adjusted EBITDA was $268.2 million

Twelve Month Results

• Net revenue was $2.11 billion

• Net income was $496.8 million

• Adjusted EBITDA was $985.7 million

BATON ROUGE, La., Feb. 23, 2024 (GLOBE NEWSWIRE) -- Lamar Advertising Company (the “Company” or “Lamar”) (Nasdaq: LAMR), a leading owner and operator of outdoor advertising and logo sign displays, announces the Company’s operating results for the fourth quarter and year ended December 31, 2023.

"Revenue growth accelerated as we moved through the fourth quarter, primarily because of strength in local sales. In addition, our team continued to do an outstanding job controlling expenses," Lamar chief executive Sean Reilly said. "The result is that we achieved $7.47 in full year AFFO per diluted share, easily beating our revised guidance range for 2023. For 2024, we are projecting further growth in AFFO, with a range of $7.67 to $7.82 per diluted share."

Fourth Quarter Highlights

• Net revenue increased 3.8%

• Adjusted EBITDA increased 6.3%

• Diluted AFFO per share increased 9.9%

Fourth Quarter Results

Lamar reported net revenues of $555.9 million for the fourth quarter of 2023 versus $535.5 million for the fourth quarter of 2022, a 3.8% increase. Operating income for the fourth quarter of 2023 increased $81.7 million to $191.7 million as compared to $110.1 million for the same period in 2022. Lamar recognized net income of $149.3 million for the fourth quarter of 2023 as compared to net income of $66.1 million for same period in 2022, an increase of $83.2 million. Net income per diluted share was $1.46 and $0.65 for the three months ended December 31, 2023 and 2022, respectively.

Adjusted EBITDA for the fourth quarter of 2023 was $268.2 million versus $252.3 million for the fourth quarter of 2022, an increase of 6.3%.

Cash flow provided by operating activities was $254.2 million for the three months ended December 31, 2023 versus $244.5 million for the fourth quarter of 2022, an increase of $9.7 million. Free cash flow for the fourth quarter of 2023 was $180.3 million as compared to $159.3 million for the same period in 2022, a 13.2% increase.

For the fourth quarter of 2023, funds from operations, or FFO, was $213.7 million versus $195.2 million for the same period in 2022, an increase of 9.5%. Adjusted funds from operations, or AFFO, for the fourth quarter of 2023 was $215.0 million compared to $194.5 million for the same period in 2022, an increase of 10.5%. Diluted AFFO per share increased 9.9% to $2.10 for the three months ended December 31, 2023 as compared to $1.91 for the same period in 2022.

Acquisition-Adjusted Three Months Results

Acquisition-adjusted net revenue for the fourth quarter of 2023 increased 2.5% over acquisition-adjusted net revenue for the fourth quarter of 2022. Acquisition-adjusted EBITDA for the fourth quarter of 2023 increased 5.1% as compared to acquisition-adjusted EBITDA for the fourth quarter of 2022. Acquisition-adjusted net revenue and acquisition-adjusted EBITDA include adjustments to the 2022 period for acquisitions and divestitures for the same time frame as actually owned in the 2023 period. See “Reconciliation of Reported Basis to Acquisition-Adjusted Results”, which provides reconciliations to GAAP for acquisition-adjusted measures.

Twelve Month Results

Lamar reported net revenues of $2.11 billion for the twelve months ended December 31, 2023 versus $2.03 billion for the twelve months ended December 31, 2022, a 3.9% increase. Operating income for the twelve months ended December 31, 2023 increased $97.4 million to $675.4 million as compared to $578.0 million for the same period in 2022. Lamar recognized net income of $496.8 million for the twelve months ended December 31, 2023 as compared to net income of $438.6 million for the same period in 2022, an increase of $58.2 million. Net income per diluted share was $4.85 and $4.31 for the twelve months ended December 31, 2023 and 2022, respectively.

Adjusted EBITDA for the twelve months ended December 31, 2023 was $985.7 million versus $938.1 million for the same period in 2022, an increase of 5.1%.

Cash flow provided by operating activities was $783.6 million for the twelve months ended December 31, 2023, an increase of $2.0 million as compared to the same period in 2022. Free cash flow for the twelve months ended December 31, 2023 was $633.8 million as compared to $636.3 million for the same period in 2022, a 0.4% decrease.

For the twelve months ended December 31, 2023, funds from operations, or FFO, was $767.9 million versus $757.0 million for the same period in 2022, an increase of 1.4%. Adjusted funds from operations, or AFFO, for the twelve months ended December 31, 2023 was $762.3 million compared to $749.7 million for the same period in 2022, an increase of 1.7%. Diluted AFFO per share increased 1.2% to $7.47 for the twelve months ended December 31, 2023 as compared to $7.38 for the same period in 2022.

Liquidity

As of December 31, 2023, Lamar had $715.8 million in total liquidity that consisted of $671.2 million available for borrowing under its revolving senior credit facility and $44.6 million in cash and cash equivalents. There were $70.0 million in borrowings outstanding under the Company’s revolving credit facility and $249.6 million outstanding under the Accounts Receivable Securitization Program as of the same date.

Guidance

We expect net income per diluted share for fiscal year 2024 to be between $5.02 and $5.07, with diluted AFFO per share between $7.67 and $7.82. See “Supplemental Schedules Unaudited REIT Measures and Reconciliations to GAAP Measures” for reconciliation to GAAP.

Forward-Looking Statements

This press release contains forward-looking statements, including statements regarding sales trends. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward-looking statements. These risks and uncertainties include, among others: (1) our significant indebtedness; (2) the state of the economy and financial markets generally, and the effect of the broader economy on the demand for advertising; (3) the continued popularity of outdoor advertising as an advertising medium; (4) our need for and ability to obtain additional funding for operations, debt refinancing or acquisitions; (5) our ability to continue to qualify as a Real Estate Investment Trust (“REIT”) and maintain our status as a REIT; (6) the regulation of the outdoor advertising industry by federal, state and local governments; (7) the integration of companies and assets that we acquire and our ability to recognize cost savings or operating efficiencies as a result of these acquisitions; (8) changes in accounting principles, policies or guidelines; (9) changes in tax laws applicable to REITs or in the interpretation of those laws; (10) our ability to renew expiring contracts at favorable rates; (11) our ability to successfully implement our digital deployment strategy; and (12) the market for our Class A common stock. For additional information regarding factors that may cause actual results to differ materially from those indicated in our forward-looking statements, we refer you to the risk factors included in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2022, as supplemented by any risk factors contained in our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K. We caution investors not to place undue reliance on the forward-looking statements contained in this document. These statements speak only as of the date of this document, and we undertake no obligation to update or revise the statements, except as may be required by law.

Use of Non-GAAP Financial Measures

The Company has presented the following measures that are not measures of performance under accounting principles generally accepted in the United States of America (“GAAP”): adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”), free cash flow, funds from operations (“FFO”), adjusted funds from operations (“AFFO”), diluted AFFO per share, outdoor operating income, acquisition-adjusted results and acquisition-adjusted consolidated expense. Our management reviews our performance by focusing on these key performance indicators not prepared in conformity with GAAP. We believe these non-GAAP performance indicators are meaningful supplemental measures of our operating performance and should not be considered in isolation of, or as a substitute for their most directly comparable GAAP financial measures.

Our Non-GAAP financial measures are determined as follows:

• We define adjusted EBITDA as net income before income tax expense (benefit), interest expense (income), loss (gain) on extinguishment of debt and investments, equity in (earnings) loss of investee, stock-based compensation, depreciation and amortization, loss (gain) on disposition of assets and investments, transaction expenses and capitalized contract fulfillment costs, net.

• Adjusted EBITDA margin is defined as adjusted EBITDA divided by net revenues.

• Free cash flow is defined as adjusted EBITDA less interest, net of interest income and amortization of deferred financing costs, current taxes, preferred stock dividends and total capital expenditures.

• We use the National Association of Real Estate Investment Trusts definition of FFO, which is defined as net income before (gain) loss from the sale or disposal of real estate assets and investments, net of tax, and real estate related depreciation and amortization and including adjustments to eliminate unconsolidated affiliates and non-controlling interest.

• We define AFFO as FFO before (i) straight-line revenue and expense; (ii) capitalized contract fulfillment costs, net; (iii) stock-based compensation expense; (iv) non-cash portion of tax provision; (v) non-real estate related depreciation and amortization; (vi) amortization of deferred financing costs; (vii) loss on extinguishment of debt; (viii) transaction expenses; (ix) non-recurring infrequent or unusual losses (gains); (x) less maintenance capital expenditures; and (xi) an adjustment for unconsolidated affiliates and non-controlling interest.

• Diluted AFFO per share is defined as AFFO divided by weighted average diluted common shares outstanding.

• Outdoor operating income is defined as operating income before corporate expenses, stock-based compensation, capitalized contract fulfillment costs, net, transaction expenses, depreciation and amortization and loss (gain) on disposition of assets.

• Acquisition-adjusted results adjusts our net revenue, direct and general and administrative expenses, outdoor operating income, corporate expense and EBITDA for the prior period by adding to, or subtracting from, the corresponding revenue or expense generated by the acquired or divested assets before our acquisition or divestiture of these assets for the same time frame that those assets were owned in the current period. In calculating acquisition-adjusted results, therefore, we include revenue and expenses generated by assets that we did not own in the prior period but acquired in the current period. We refer to the amount of pre-acquisition revenue and expense generated by or subtracted from the acquired assets during the prior period that corresponds with the current period in which we owned the assets (to the extent within the period to which this report relates) as “acquisition-adjusted results”.

• Acquisition-adjusted consolidated expense adjusts our total operating expense to remove the impact of stock-based compensation, depreciation and amortization, transaction expenses, capitalized contract fulfillment costs, net, and loss (gain) on disposition of assets and investments. The prior period is also adjusted to include the expense generated by the acquired or divested assets before our acquisition or divestiture of such assets for the same time frame that those assets were owned in the current period.

Adjusted EBITDA, FFO, AFFO, diluted AFFO per share, free cash flow, outdoor operating income, acquisition-adjusted results and acquisition-adjusted consolidated expense are not intended to replace other performance measures determined in accordance with GAAP. Free cash flow, FFO and AFFO do not represent cash flows from operating activities in accordance with GAAP and, therefore, these measures should not be considered indicative of cash flows from operating activities as a measure of liquidity or of funds available to fund our cash needs, including our ability to make cash distributions. Adjusted EBITDA, free cash flow, FFO, AFFO, diluted AFFO per share, outdoor operating income, acquisition-adjusted results and acquisition-adjusted consolidated expense are presented as we believe each is a useful indicator of our current operating performance. Specifically, we believe that these metrics are useful to an investor in evaluating our operating performance because (1) each is a key measure used by our management team for purposes of decision making and for evaluating our core operating results; (2) adjusted EBITDA is widely used in the industry to measure operating performance as it excludes the impact of depreciation and amortization, which may vary significantly among companies, depending upon accounting methods and useful lives, particularly where acquisitions and non-operating factors are involved; (3) adjusted EBITDA, FFO, AFFO, diluted AFFO per share and acquisition-adjusted consolidated expense each provides investors with a meaningful measure for evaluating our period-over-period operating performance by eliminating items that are not operational in nature and reflect the impact on operations from trends in occupancy rates, operating costs, general and administrative expenses and interest costs; (4) acquisition-adjusted results is a supplement to enable investors to compare period-over-period results on a more consistent basis without the effects of acquisitions and divestitures, which reflects our core performance and organic growth (if any) during the period in which the assets were owned and managed by us; (5) free cash flow is an indicator of our ability to service debt and generate cash for acquisitions and other strategic investments; (6) outdoor operating income provides investors a measurement of our core results without the impact of fluctuations in stock-based compensation, depreciation and amortization and corporate expenses; and (7) each of our Non-GAAP measures provides investors with a measure for comparing our results of operations to those of other companies.

Our measurement of adjusted EBITDA, FFO, AFFO, diluted AFFO per share, free cash flow, outdoor operating income, acquisition-adjusted results and acquisition-adjusted consolidated expense may not, however, be fully comparable to similarly titled measures used by other companies. Reconciliations of adjusted EBITDA, FFO, AFFO, diluted AFFO per share, free cash flow, outdoor operating income, acquisition-adjusted results and acquisition-adjusted consolidated expense to the most directly comparable GAAP measures have been included herein.

Conference Call Information

A conference call will be held to discuss the Company’s operating results on Friday, February 23, 2024 at 8:00 a.m. central time. Instructions for the conference call and Webcast are provided below:

Conference Call

All Callers:	1-800-420-1271 or 1-785-424-1634
Passcode:	63104
Live Webcast:	www.lamar.com/About/Investors/Presentations
Webcast Replay:	www.lamar.com/About/Investors/Presentations
	Available through Friday, March 1, 2024 at 11:59 p.m. eastern time
Company Contact:	Buster Kantrow
	Director of Investor Relations
	(225) 926-1000
	bkantrow@lamar.com

General Information

Founded in 1902, Lamar Advertising (Nasdaq: LAMR) is one of the largest outdoor advertising companies in North America, with over 363,000 displays across the United States and Canada. Lamar offers advertisers a variety of billboard, interstate logo, transit and airport advertising formats, helping both local businesses and national brands reach broad audiences every day. In addition to its more traditional out-of-home inventory, Lamar is proud to offer its customers the largest network of digital billboards in the United States with approximately 4,800 displays.

LAMAR ADVERTISING COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
	Three Months Ended December 31,								Twelve Months Ended December 31,
		2023				2022				2023				2022
Net revenues	$	555,909			$	535,510			$	2,110,987			$	2,032,140
Operating expenses (income)
Direct advertising expenses		181,501				173,894				697,107				667,820
General and administrative expenses		84,398				85,984				332,790				336,169
Corporate expenses		21,846				23,357				95,366				90,072
Stock-based compensation		6,287				8,805				22,649				23,136
Capitalized contract fulfillment costs, net		(105	)			(92	)			(308	)			(555	)
Transaction expenses		—				—				—				3,769
Depreciation and amortization		70,504				147,239				293,423				349,449
Gain on disposition of assets		(231	)			(13,731	)			(5,474	)			(15,721	)
Total operating expense		364,200				425,456				1,435,553				1,454,139
Operating income		191,709				110,054				675,434				578,001
Other expense (income)
Loss on extinguishment of debt		—				—				115				—
Interest income		(556	)			(551	)			(2,115	)			(1,293	)
Interest expense		44,349				37,686				174,512				127,510
Equity in earnings of investee		(2,370	)			(1,660	)			(3,696	)			(4,315	)
		41,423				35,475				168,816				121,902
Income before income tax expense		150,286				74,579				506,618				456,099
Income tax expense		961				8,476				9,782				17,452
Net income		149,325				66,103				496,836				438,647
Earnings attributable to non-controlling interest		240				—				1,073				—
Net income attributable to controlling interest		149,085				66,103				495,763				438,647
Preferred stock dividends		92				92				365				365
Net income applicable to common stock	$	148,993			$	66,011			$	495,398			$	438,282
Earnings per share:
Basic earnings per share	$	1.46			$	0.65			$	4.86			$	4.32
Diluted earnings per share	$	1.46			$	0.65			$	4.85			$	4.31
Weighted average common shares outstanding:
Basic		102,008,382				101,699,470				101,920,268				101,527,778
Diluted		102,166,907				101,765,520				102,106,647				101,634,543
OTHER DATA
Free Cash Flow Computation:
Adjusted EBITDA	$	268,164			$	252,275			$	985,724			$	938,079
Interest, net		(42,175	)			(35,504	)			(165,859	)			(120,059	)
Current tax expense		513				(7,115	)			(7,398	)			(14,240	)
Preferred stock dividends		(92	)			(92	)			(365	)			(365	)
Total capital expenditures		(46,119	)			(50,270	)			(178,271	)			(167,078	)
Free cash flow	$	180,291			$	159,294			$	633,831			$	636,337

SUPPLEMENTAL SCHEDULES SELECTED BALANCE SHEET AND CASH FLOW DATA (IN THOUSANDS)
	December 31, 2023				December 31, 2022
Selected Balance Sheet Data:
Cash and cash equivalents	$	44,605			$	52,619
Working capital deficit	$	(340,711	)		$	(361,485	)
Total assets	$	6,563,622			$	6,475,214
Total debt, net of deferred financing costs (including current maturities)	$	3,341,127			$	3,312,805
Total stockholders’ equity	$	1,216,788			$	1,195,374

	Three Months Ended December 31,						Twelve Months Ended December 31,
		2023			2022			2023			2022
Selected Cash Flow Data:
Cash flows provided by operating activities	$	254,193		$	244,507		$	783,613		$	781,612
Cash flows used in investing activities	$	64,194		$	216,607		$	310,119		$	619,071
Cash flows used in financing activities	$	184,899		$	54,477		$	481,635		$	209,319

SUPPLEMENTAL SCHEDULES UNAUDITED RECONCILIATIONS OF NON-GAAP MEASURES (IN THOUSANDS)
	Three Months Ended December 31,								Twelve Months Ended December 31,
		2023				2022				2023				2022
Reconciliation of Cash Flows Provided by Operating Activities to Free Cash Flow:
Cash flows provided by operating activities	$	254,193			$	244,507			$	783,613			$	781,612
Changes in operating assets and liabilities		(23,458	)			(31,614	)			41,899				27,967
Total capital expenditures		(46,119	)			(50,270	)			(178,271	)			(167,078	)
Preferred stock dividends		(92	)			(92	)			(365	)			(365	)
Capitalized contract fulfillment costs, net		(105	)			(92	)			(308	)			(555	)
Transaction expenses		—				—				—				3,769
Other		(4,128	)			(3,145	)			(12,737	)			(9,013	)
Free cash flow	$	180,291			$	159,294			$	633,831			$	636,337
Reconciliation of Net Income to Adjusted EBITDA:
Net income	$	149,325			$	66,103			$	496,836			$	438,647
Loss on extinguishment of debt		—				—				115				—
Interest income		(556	)			(551	)			(2,115	)			(1,293	)
Interest expense		44,349				37,686				174,512				127,510
Equity in earnings of investee		(2,370	)			(1,660	)			(3,696	)			(4,315	)
Income tax expense		961				8,476				9,782				17,452
Operating income		191,709				110,054				675,434				578,001
Stock-based compensation		6,287				8,805				22,649				23,136
Capitalized contract fulfillment costs, net		(105	)			(92	)			(308	)			(555	)
Transaction expenses		—				—				—				3,769
Depreciation and amortization		70,504				147,239				293,423				349,449
Gain on disposition of assets		(231	)			(13,731	)			(5,474	)			(15,721	)
Adjusted EBITDA	$	268,164			$	252,275			$	985,724			$	938,079
Capital expenditure detail by category:
Billboards - traditional	$	14,346			$	15,027			$	54,965			$	45,415
Billboards - digital		15,937				19,973				75,535				81,145
Logo		2,540				3,512				12,039				13,151
Transit		1,205				1,713				3,595				4,734
Land and buildings		5,709				6,360				15,494				11,462
Operating equipment		6,382				3,685				16,643				11,171
Total capital expenditures	$	46,119			$	50,270			$	178,271			$	167,078

SUPPLEMENTAL SCHEDULES UNAUDITED RECONCILIATIONS OF NON-GAAP MEASURES (IN THOUSANDS)
	Three Months Ended December 31,									Twelve Months Ended December 31,
		2023			2022		% Change				2023			2022		% Change
Reconciliation of Reported Basis to Acquisition-Adjusted Results(a):
Net revenue	$	555,909		$	535,510		3.8%			$	2,110,987		$	2,032,140		3.9%
Acquisitions and divestitures		—			6,722						—			35,428
Acquisition-adjusted net revenue	$	555,909		$	542,232		2.5%			$	2,110,987		$	2,067,568		2.1%
Reported direct advertising and G&A expenses	$	265,899		$	259,878		2.3%			$	1,029,897		$	1,003,989		2.6%
Acquisitions and divestitures		—			3,847						—			21,168
Acquisition-adjusted direct advertising and G&A expenses	$	265,899		$	263,725		0.8%			$	1,029,897		$	1,025,157		0.5%
Outdoor operating income	$	290,010		$	275,632		5.2%			$	1,081,090		$	1,028,151		5.1%
Acquisition and divestitures		—			2,875						—			14,260
Acquisition-adjusted outdoor operating income	$	290,010		$	278,507		4.1%			$	1,081,090		$	1,042,411		3.7%
Reported corporate expense	$	21,846		$	23,357		(6.5)%			$	95,366		$	90,072		5.9%
Acquisitions and divestitures		—			—						—			—
Acquisition-adjusted corporate expenses	$	21,846		$	23,357		(6.5)%			$	95,366		$	90,072		5.9%
Adjusted EBITDA	$	268,164		$	252,275		6.3%			$	985,724		$	938,079		5.1%
Acquisitions and divestitures		—			2,875						—			14,260
Acquisition-adjusted EBITDA	$	268,164		$	255,150		5.1%			$	985,724		$	952,339		3.5%

(a) Acquisition-adjusted net revenue, direct advertising and general and administrative expenses, outdoor operating income, corporate expenses and EBITDA include adjustments to 2022 for acquisitions and divestitures for the same time frame as actually owned in 2023.   
                                                                                                                                                                                                                     

SUPPLEMENTAL SCHEDULES UNAUDITED RECONCILIATIONS OF NON-GAAP MEASURES (IN THOUSANDS)
	Three Months Ended December 31,											Twelve Months Ended December 31,
		2023				2022			% Change				2023				2022			% Change
Reconciliation of Net Income to Outdoor Operating Income:
Net income	$	149,325			$	66,103			125.9%			$	496,836			$	438,647			13.3%
Loss on extinguishment of debt		—				—							115				—
Interest expense, net		43,793				37,135							172,397				126,217
Equity in earnings of investee		(2,370	)			(1,660	)						(3,696	)			(4,315	)
Income tax expense		961				8,476							9,782				17,452
Operating income		191,709				110,054			74.2%				675,434				578,001			16.9%
Corporate expenses		21,846				23,357							95,366				90,072
Stock-based compensation		6,287				8,805							22,649				23,136
Capitalized contract fulfillment costs, net		(105	)			(92	)						(308	)			(555	)
Transaction expenses		—				—							—				3,769
Depreciation and amortization		70,504				147,239							293,423				349,449
Gain on disposition of assets		(231	)			(13,731	)						(5,474	)			(15,721	)
Outdoor operating income	$	290,010			$	275,632			5.2%			$	1,081,090			$	1,028,151			5.1%

SUPPLEMENTAL SCHEDULES UNAUDITED RECONCILIATIONS OF NON-GAAP MEASURES (IN THOUSANDS)
	Three Months Ended December 31,											Twelve Months Ended December 31,
		2023				2022			% Change				2023				2022			% Change
Reconciliation of Total Operating Expense to Acquisition-Adjusted Consolidated Expense:
Total operating expense	$	364,200			$	425,456			(14.4)%			$	1,435,553			$	1,454,139			(1.3)%
Gain on disposition of assets		231				13,731							5,474				15,721
Depreciation and amortization		(70,504	)			(147,239	)						(293,423	)			(349,449	)
Transaction expenses		—				—							—				(3,769	)
Capitalized contract fulfillment costs, net		105				92							308				555
Stock-based compensation		(6,287	)			(8,805	)						(22,649	)			(23,136	)
Acquisitions and divestitures		—				3,847							—				21,168
Acquisition-adjusted consolidated expense	$	287,745			$	287,082			0.2%			$	1,125,263			$	1,115,229			0.9%

SUPPLEMENTAL SCHEDULES UNAUDITED REIT MEASURES AND RECONCILIATIONS TO GAAP MEASURES (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
	Three Months Ended December 31,								Twelve Months Ended December 31,
		2023				2022				2023				2022
Adjusted Funds from Operations:
Net income	$	149,325			$	66,103			$	496,836			$	438,647
Depreciation and amortization related to real estate		67,101				144,223				281,026				337,387
Gain from sale or disposal of real estate, net of tax		(88	)			(13,632	)			(5,201	)			(15,415	)
Adjustments for unconsolidated affiliates and non-controlling interest		(2,610	)			(1,496	)			(4,769	)			(3,631	)
Funds from operations	$	213,728			$	195,198			$	767,892			$	756,988
Straight-line expense		1,182				1,102				4,658				3,986
Capitalized contract fulfillment costs, net		(105	)			(92	)			(308	)			(555	)
Stock-based compensation expense		6,287				8,805				22,649				23,136
Non-cash portion of tax provision		1,474				1,361				2,384				3,212
Non-real estate related depreciation and amortization		3,403				3,016				12,397				12,062
Amortization of deferred financing costs		1,618				1,631				6,538				6,158
Loss on extinguishment of debt		—				—				115				—
Transaction expenses		—				—				—				3,769
Capitalized expenditures-maintenance		(15,178	)			(17,978	)			(58,820	)			(62,659	)
Adjustments for unconsolidated affiliates and non-controlling interest		2,610				1,496				4,769				3,631
Adjusted funds from operations	$	215,019			$	194,539			$	762,274			$	749,728
Divided by weighted average diluted common shares outstanding		102,166,907				101,765,520				102,106,647				101,634,543
Diluted AFFO per share	$	2.10			$	1.91			$	7.47			$	7.38

SUPPLEMENTAL SCHEDULES UNAUDITED REIT MEASURES AND RECONCILIATIONS TO GAAP MEASURES (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
Projected 2024 Adjusted Funds From Operations:
		Year ended December 31, 2024
		Low				High
Net income		$	515,185			$	520,185
Depreciation and amortization related to real estate			288,000				288,000
Gain from sale or disposal of real estate, net of tax			(5,000	)			(5,000	)
Adjustment for unconsolidated affiliates and non-controlling interest			(4,500	)			(4,500	)
Funds From Operations		$	793,685			$	798,685
Straight-line expense			4,200				4,200
Capitalized contract fulfillment costs, net			500				500
Stock-based compensation expense			15,000				25,000
Non-cash portion of tax provision			500				500
Non-real estate related depreciation and amortization			12,000				12,000
Amortization of deferred financing costs			6,000				6,000
Loss on extinguishment of debt			315				315
Capitalized expenditures—maintenance			(50,000	)			(50,000	)
Adjustment for unconsolidated affiliates and non-controlling interest			4,500				4,500
Adjusted Funds From Operations		$	786,700			$	801,700
Weighted average diluted shares outstanding			102,550,000				102,550,000
Diluted earnings per share		$	5.02			$	5.07
Diluted AFFO per share		$	7.67			$	7.82

The guidance provided above is based on a number of assumptions that management believes to be reasonable and reflects our expectations as of February 2024. Actual results may differ materially from these estimates as a result of various factors, and we refer to the cautionary language regarding “forward-looking statements” included in the press release when considering this information.