UPDATE 3-Lamar loss widens, sees Q1 rev below view; shares fall

Thu Feb 25, 2010 2:06pm EST

* Q4 loss $0.22/shr vs est loss $0.17/shr

* Q4 revenue $262.3 mln vs est $261.6 mln

* Sees Q1 rev $245 mln vs est $247.8 mln

* Shares fall as much as 9 percent (Adds comments from conference call, updates share movement)

By Sudipto Ganguly

BANGALORE, Feb 25 (Reuters) - Billboard operator Lamar Advertising Co's (LAMR.O) quarterly loss widened and revenue view fell short of estimates, as firms continue to curb advertising spend amid a weak economy.

Shares of the 108-year old company, which also operates logo signs and transit advertising displays, fell as much as 9 percent in early session on Nasdaq, but regained some of their losses to trade down about 2 percent at $29.07 in afternoon trade.

Analysts have been expecting a faster-than-expected turnaround in outdoor advertising, driven by shorter contracts, local advertising gains and demand for digital boards.

"It looks like 2010 is a recovery year. What we are seeing in the book is good momentum and every month is getting better," Chief Operating Officer Sean Reilly said in a conference call with analysts.

Pricing in the industry is stabilizing with every passing month, the company said in the call.

"We continue to believe... that improving national and local ad markets will provide a lift to Lamar and other billboard operators in the second half," Lazard Capital Markets analyst Barton Crockett wrote in a note to clients.

The company gave a "slightly conservative" outlook for the first quarter, Barclays Capital analyst George Hawkey said.

The shrinking "lag-effect" on outdoor recovery provides opportunity for the company and the stock remained undervalued relative to history and peers, Hawkey said.

Its fourth-quarter net loss widened to $19.7 million, or 22 cents a share, from $8.6 million, or 9 cents a share, last year. Revenue declined about 6 percent to $262.3 million.

Baton Rouge, Louisiana-based Lamar, which competes with CBS Outdoor -- a unit of CBS Corp (CBS.N) -- and Clear Channel Outdoor Holdings Inc (CCO.N), expects first-quarter revenue of about $245 million, below analysts' expectations of $247.8 million, according to Thomson Reuters I/B/E/S. (Reporting by Sudipto Ganguly in Bangalore; Editing by Saumyadeb Chakrabarty and Anil D'Silva)

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