SBAC - Earnings call transcript Q1 2018 | SBA Communications Corporation

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the SBA First Quarter Results Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given to you at that time. [Operator Instructions] And as a reminder, this conference is being recorded. to Mark conference DeRussy. like VP to now Finance, of would turn over the the I Please ahead. go

Mark DeRussy

Good evening, everyone, for SBA's and thank you quarter earnings for XXXX conference call. first joining us

President today Jeff Brendan me our Officer. Financial Chief Executive with Here Cavanagh, Stoops, our Officer; and are and Chief

that Some of in In beyond. risks on from results detail today's release, and will we SEC future this including, filings, forward-looking, material and is the for cause limited not XXXX information our to we expectations. but our to, discuss our call may any guidance press differ

XX, Our any we statements are make. as of we statement no today, update April to and obligation may have forward-looking

In financial landing page operating that, it can is these our and items I the will reconciliation data measures located found turn Brendan. on information financial other metrics. our in website. package, regarding addition, be key Relations With will which to supplemental include of comments of non-GAAP The and Investor our over other

Brendan Cavanagh

Good were evening. results in Thanks Total leasing positive cash the with operations international services domestic and from incremental solid our leasing as $XXX.X and quarter our revenues produced SBA leasing very were site contributions year Mark. first million. business. as We both $XXX.X realizing quarter. began million GAAP the well site for a revenues

X.X% first by a including with the X.X% terminations. slightly growth which leasing to Domestic recurring of On calculated million. than churn. $X.X tower revenue on provided which related earnings basis basis, net first a same rates constant quarter fourth impact and quarter, our was on first cast of leasing point currency was was previously X.X% basis our of the recurring a growth and churn, basis, cash was weaker we quarter over revenue X.X% Metro/Leap same exchange X.X% negatively quarter, X.X%. of the the Foreign estimates growth year for Clearwire on quarter XXXX, including Same over XX% which first the for gross leasing release gross last of a tower tower revenue of impacting

our revenue operational revenue activity operational on rate basis. quarter growth growth previous as gross was leasing Revenue but on quarter during impact reported XXXX. and mentioned As basis or we call, leasing activity recognized our at this tower signed representing of currency churn application Internationally, prior agreements. year-over-year of sequentially various we XX expect revenue domestic XXXX, gross XXXX into the the from our same seen some began year. in earnings to new during will fourth of X.X^% the leasing basis, quarter increase including convert growth early will a up rate in tower begin was leasing X.X% this to modest on cash organic throughout backlog same activity increased throughout signed points tiny be our times XX.X%. growth was Gross the up Domestic a Brazil from constant to

represented XX% and leases third carriers total domestic signed the Newly two of leasing up up revenue during from about signed one big came revenue from the thirds incremental leasing new and quarter. amendments four domestic

first the was Our also level International markets all contributions leasing healthy and in from of very quarter and new of and backlog see to year. positive we particular. signings a amendment leasing activity domestic expect our operational with to remains in continue application over lease of Brazil elevated solid balance the the

non-U.S. The expectation. revenues of during majority revenue site Leap pass of During leasing cash revenue dollar to in Brazil. the regard Metro, representing we Brazil leasing with in leasing see of churn, churn leases site denominated revenues first continue excluding U.S. revenue our quarter, all through XX.X% cash from With With was from of dollars. with quarter expenses. from to the Clearwire cash XX% denominated XX.X% was and site consistent quarter first

years. of XX, off from $XX over leases two other rate million the same tenants approximately all next Clearwire with recurring in Domestic quarter churn Tower an was turn revenue of Metro, ultimately first the million. quarter basis run annual we flow basis that three have we for to tower cash to March $XXX expect As Leap from annual was the XX first points. and on

operating towers, through have to flow Adjusted was tower cash with direct expenses. impact XX.X% the the us our and the $XXX.X produce managing XX.X% industry margin continue cash We continue International quarter. allowing associated in was in margin quarter first pass of reimbursable the was XX.X% excluding leading cost to margin. to tower flow success million. Domestic EBITDA

continues compared the total international as headcount the to to results due leasing efficiency of the XXXX. timing Cash the EBITDA year. earlier to very delays certain speak in in margin Our revenue expenses period. SG&A be the were in of due our the of up and expectations, part Cash additions, the businesses. other better EBITDA remain first the XX.X% from low were over expected to to and Adjusted solid $XX.X on of Services first in SG&A the the later revenues million, both a little as timing quarter quarter incurred XX.X% well as results our was certain the quarter was X.X% a than in quarter services year in adjusted percentage quarter operations. for of

first attributable of EBITDA Excluding the total expenses, $XXX.X XX.X%. adjusted quarter. EBITDA impact leasing XX% first was through was was revenues business our adjusted in in Approximately the our of tower margin million. pass to from the quarter AFFO

during increased non-discretionary aided be half expected still lower previously than share of which is quarter in of later per to CapEx million AFFO XXXX. $X anticipated. was by $X.XX. approximately About AFFO incurred the X.X% Our to

the continued capital expand into builds During investing acquisitions. first and also incremental new quarter to our both we tower portfolio,

we first acquired $XXX.X sites for with the communication of sites these During quarter XXX million internationally. located XXX

announced quarter price $XXX.X aggregate million. five to first Subsequent of end as built million, sites Salvador an under for sites at the close Millicom have price Also, We will in throughout to of balance acquisition also local XXX XXX located additional previously we sites acquired a be aggregate sites of today an XX communication XXXX. El of We from additional quarter. have the of these purchase the contract subsidiary we International. anticipate XXX sites at purchased including during $XXX.X

and to land We provides our strategic under in also continue invest both benefits. the sites, which financial

ground average and of life remaining or land end of XX% years During to underneath including spent ground we is leases At the easements controlled the aggregate land than our buy the million our quarter an options extend of XX under terms. XX to the and approximately under owned we quarter more and for lease renewal approximately the our control towers $XX.X years.

earnings press includes forward to full balance our an year the year of Looking outlook to the XXXX. release for our update now,

year although We currency the decreased changes for assumption $X full have EBITDA foreign full leasing million revenue currency These full impacted revenue increased each. negative in our have year reflecting our impact outlook year our basis, GAAP we on also flow our changes and rate million full remainder cash to year. assumptions by year of AFFO of a adjusted outlook our and currency slightly tower by negatively the $X the foreign for leasing for constant outlook guidance our site

million. our by addition, have for we straight lowered year line expectation In full $X leasing revenue

outlook increase have flow, reduction other approximately our constant includes million guidance, benefit increased our changes million $X constant services a impact of positively of full straight since on has FX last expenses such adjusted are and as outlook related been result contributions which million two $X revenue million, we $X revenue and of by first full been on and million pass $X nonorganic growth revenue also months other Since churn year for has $X and outlook miscellaneous our quarter increased organic revenues. basis. outlook expectations, a increase been currency full we our line changes, results. $X the by currency has our our in the a leasing unchanged. gross $X which EBITDA and tower strong revenue basis adjusted to impact only items increased million by in to EBITDA, through The in cash it SG&A leaving outlook year Excluding as year largely timing consisting reimbursable million increase revenue The increases in cash an

Our today and does contract or year not beyond does outlook it those XXXX today. those beyond updated assume assume additional under full closed any debt to completed any further share not acquisitions repurchases prior or financing

earlier will term closed an incorporate cost loan financing Our more Mark discuss a loans. million detail which of after We our raised the the in repayment this B updated financing outlook this of in incremental month, our impact $XXX moment. term existing interest in

rate floating the slightly increasing a We of also impacting continue LIBOR to the rest year our throughout rate assume debt.

result net expense contract primarily result activities as we by million full for interest this outlook, in by invested outlook, as our initial to of increased increase outlook additional adjusted have under be lowered Notwithstanding year anticipated our million. our full to $XX provided As we since increase the we XXXX year well dollars repurchases a outlook interest our our recent EBITDA assets have $XX financing cash expense. AFFO in new a of invested year our or full or stock as

now with for included of capital which no put incremental purposes fully AFFO the assumption contract midpoint share of not year work per the under $X.X today new to that has resulted have interest guidance, Our in expense decrease we full at of increased our as of beyond combined the assumption means allocation money outlook. a of

increased provide from outlook balance even I on our negative foreign additional for interest will in year our the the our over an impact things full initial change of turn who currency that $X.XX have With expense. share Excluding update by outlook, liquidity AFFO and our Mark, sheet. to will per the position with would assumptions

Mark DeRussy

the to EBITDA ratio first of targeted Brendan. to range billion X quarter X.X SBA right adjusted of X.X you, debt ended Thank net X.X times, debt of our annualized was the and with times. middle in our net leverage

XXX revolving interest March have X, fixed in with securities under the approved facility offering XXXX-XC a proceeds as our March X, securities well a interest were markets At Our X.X the On revolver. end to subsequent We active of capital quarter large outstanding coverage our first net final tower financings. X.XXX% anticipated payable tower and XXX debt and maturity this expense repay date secured These March XXXX. at monthly. interest. trust interest as the with we XXXX quarter and an of first securities of of were of times. and combination unpaid of rate repayment quarter to of million used to revenue during completion date ratio borrowings The EBITDA two was credit in cash to issued full the million under had tower our adjusted we XXXX-XD the in X, of cash net the

XX, we interest will on April subsidiary, a The XX, $X.X year senior was billion per It XXXX. on at LIBOR bears issued base four year Additionally, plus X% plus mature through year. that rate X% wholly term a April par seven loan owned secured election XX.XX% new either per our at the or loan. obtained and term of

financing extending XXX rate were of incremental an a supportive levels our of advantage We target maintain efforts were is very million month's under We and maintain to this have the of to rate. improve strong our take the existing and financing maturity our reduce debt to revolving term upsize as rate agreement, credit existing This able capital. purposes. raise typically leverage outstanding XX% term and and rate interest is flexibility of proceeds used interest our for billion to loans dates. to market be term XX% We're or current our our we to transaction us also assets to likely repay The to level will more X.XX outstanding determine Also, The so five our debt our allow loan with as while under rate we fixed one balances this our LIBOR the this retired pleased financings to credit as our facility international X.X%. general use instruments. facility a under pay of off of spread collateral. interest corporate and loan able next efficiently used will were anticipate floating with

XXX.X plus Amounts facility agreement. loan, to ranges will and XX, to the at base commitment our billion amended the XX.X to a interest lower credit borrowed in bear terms LIBOR the our basis leverage. and the and our and amended basis margin margins that points, under points under margin that term on the addition rate borrow other $X maturity case basis plus revolver election In applicable increased billion the rate the from senior total same XX time. either extended we date ranges The or $X.XX fees interest revolving under a basis XXXX, based from credit at facility points XXX also from points certain April to amendment at the each to conditions commitments

today the approximately weighted our outstanding plus outstanding currently of at rate five As average X.X%. our under we X.X% for forma million an Pro have new revolver, years. transactions, interest the of accruing average is is $XXX debt these maturity of and coupon LIBOR weighted

As XX, our earnings on authorization release, February Board plan a the stock repurchase mentioned Directors with our new quarter $X the fourth prior approved billion of of replacing plan.

per at this million to price first All shares retired. we of quarter were the X.X average first this under at share. share. repurchased plan additional price quarter, spent the $XXX.XX $XXX.XX XXX,XXX under to an During to plan million shares repurchase of $XX.X shares Subsequent spent million an repurchase an XXX.X the we per average

we XXXX Share repurchases The growing repurchase AFFO March under the an outstanding component and another company's of of XXX.X that to down $XXX shares turn Jeff. to April. our now over down over million authorization As million important ability plan. call this today the at XXXX XX, million in per at With from are of X.X shares have month are remaining March continue million, share. I'll XX, XXX.X

Jeff Stoops

Thanks Mark everyone. evening and good

XXXX. are stock strength financial we start in We count completed expanded sites, a through outstanding XXX international good repurchases in debt share our to heard leasing and and by the strong reduced environments, domestic two financings. you've quarter off first As portfolio results, our both significant very tower to continued see delivered

to beyond. to be XXXX carriers and highest wireless in level continue US backlog for the major busy We US very years. been the positioned driving our all In well leasing four several have domestic application

results has During the levels an coming over agreements our times future signed executed above we in revenues with in into reported and point the first as saw will This it our expectations quarter produce various to begin at year years. year we signings line the financial the growth increase solid two increase during support saw been any up in these last contracted throughout in revenue.

AT&T's with agreement our quarter, contributions all in amendments fourth and first we from quarter initiative. amendment entered leasing solid saw into signed Sprint leases including with related and lease FirstNet the the the new customers During them we under of master to activity

our recently this see very to on our to solid operational Sprint/ XXXX, continued activity both of through We levels as we these as will regard be a as be result With thus T-Mobile other we projects it impacts is to as customers any US expect a be lot new to And obviously although learned. move of continue announced will still from contributions well merger the potential news. merger. activity from monitoring there

equipment mid the additional make forward available Some put working at forth We with consistent Interestingly to amount sites things and spectrum specifically site band both their to commitment help macro we learning all them adding the made outside architecture in found T-Mobile/Sprint areas and yesterday, low the months on macro presentation materials to to XG vision and interesting spectrum of and of the and yesterday to of decommissioning. goals next activity the and where achieve speed Sprint rural over oriented and and call investment the look point to markets, yesterday's prior Sprint. more T-Mobile goal was on and urban we that with sites contemplated, the site the focus see by begun have years. a T-Mobile on all

low and antennas and and to receive performance MIMO over are band antenna in using becoming mid in much. which MIMO begun available designs way faster antennas, current applications facilitate speeds These for will than that now new existing much generally new deeper cases spectrum. twice higher wider We amendment just have some are and as

margins signed domestic first at in quarter operational wide growth strong our of Brazil execute and is as the investment vast the stronger to tower assets to activity ago. wireless positive this balanced to quality mix including XX.X%. as start In all flow performance we a and throughout of had our contracts. particular. our operational the forward. very in of there. margin of level, half EBITDA. than and continue are the quarter, pleased the We majority and was very which leasing continue of margin the cost likewise our international active we XX.X% incremental markets EBITDA expect our adjusted Latin we our converting flow The from a in adjusted strong was to our wave high business drive came we and strong into with Brazil a efficiency network quarter and a run a half year cash cash American company revenues from terms contractual the tower these had well amendments evidence data and clear of new continue and activity with a strength We our mobile Internationally also leases start consumption we the at throughout controls leasing up solid had markets believe about year of will international another Carriers in in during going fairly assets specifically be the markets of

in bit seems and economy interest that brought mostly decline by rising the about political GDP the decline a last inflation be in to we will understand given rates three the last Brazilian puzzled by the anxiety Brazilian impact and and have be month improving October Brazil. the offsetting we to declining XX% from however, the We're elections. and financial around decline the the real operational expect in what actually months are and We almost strong on disappointed it the results in

the future. continue We about be to optimistic

to repurchases. both continued we active and capital have and allocating assets result, new be share a our to As

XXX we first to our in US. portfolio XX% quarter sites acquired to the of XXX we with added of sites most quarter with markets. sites coming those end, those in international During the Subsequent another

and our under a range of As are believe result exceed contract in of we this X% combined sites end the shape to portfolio currently good with have we to again year. to acquire, the we XX% growth low

We incremental well and business high the focusing tower suited shareholders. will our assets to on that of our markets drive have approach at quality value for prices macro continued

discipline not that disciplined This overpay been imperative our available attractive likely has always than capital believe continue to mean As will we to to we is growth continue investment opportunities. assets. meant we have more it investment and portfolio for and behavior, stay have has

allocated therefore believe we and have end We trading into will our allocation net asset Toward is intend a become In quality our we've time meet financings. below or of value. of target times to QX mix we close April, million entity. already At growth shares. significant to had that goals, incremental to purchase for spent believe XXX as at two We repurchases start create X.X goal continue dividend to until when and capital debt share we have a range cumulatively share to such order least to X.X time the value. with such continue capital to stay will both continue paying million attractive our healthy its of within stock intrinsic very X.X successful to to XXXX a buybacks

The March. was securitization $XXX the completed million first refinancing in

raised single contributions April. pricing beyond. largest with market for first our our capital solid of We first incremental added and historically capital. B history the tight our continued customers access Noah great believe of and concert loan years. I'd $X.XX strong to of customers revolver $X.X attractively We on bank significant the optimism achieved give price our capacity success and and our reflect our these billion was capital financing the now to flexibility this we We bank ready questions. three transactions needs are the money The in recently for of for the us consisted to in raise our continued second, employees us part new that accomplishments $X.XX transaction. in structure. spreads and term and The which financing, billion completed for completed billion in solid thank performance XXXX with our the to their in XXXX of The network like in

Operator

James. ahead. Prentiss Our Instructions] question from Ric first go is Raymond with Please [Operator

Ric Prentiss

also Jeffrey good a think and new us Thanks, to with just is Sunday T-Mobile MLA about a life their bit guarantee talked what is you on we a afternoon or means of remaining leases the is merger busy synergies Obviously you Sprint, your the update there. the take Sprint/T-Mobile Sprint announcement, with were and that that guys? a guys. you Can have wise had little for pay, is it that what and through you kind trying on

Brendan Cavanagh

that we the our represent well Brendan. it's In actually revenue the information each as regarding T-Mobile some much each. press the Ric, for did of release contracts comes on hey how site and disclose Yeah, including overlap from Sprint stair us as revenue

on leasing where we Just to was give site our X.X%. sites you have quickly, of those today, Sprint total the cash numbers T-Mobile and X.X% revenue represented and both Sprint T-Mobile

approximately In between thirteen six has T-Mobile on left, those average years. one of terms, terms so Sprint the case years, T-Mobile approximately and in three and quite the years sprint one is of in the between range it's broad, ten and it's of case left the the years but remaining

Jeff Stoops

average elongation and which is impacted yesterday. nice in that will Ric term get the news by some obligation of not from that MLA a did We be hard fact

Ric Prentiss

we And obviously approved back is churn past transactions? Metro other like given when down, you before history about deals we just sort when you when I'm how notification and churn, the thinking acquired XXXX then XXXX, Sprint/T-Mobile should it and getting started of getting occurring? be gauge the coming acquired and those lot of was average Clearwire the about Leap, it's to questions started look or days you the timeframe churn network got of a lives what trying if with I'm deal closed and your long if - in but

Jeff Stoops

over. the be deal, need those folks It's that spectrums what and number hard generalize to this disparate large and migrated deals to with the with of given happened

sure had decommissioning, were I the making started sites given to talked going they at I was they the take to available spectrum really at is that yesterday about it any think face that the value. commentary all all that before going think remain

that think T-Mobile we and then termination certainly process to cases longer with of Leap several is it and any saw the after notices. than Metro. even this see closing a I with But and even you with to case example in going what AT&T really before make years for those started type was

Ric Prentiss

question Okay, ramp look but me for three AT&T, applications, you from think the should as about timeframe? months their process at getting nine, what is I you application it six we to that is final varies, FirstNet said amendments how trying revenue and or or to just for booked? still Sprint starting is the is to know just it gauge, long

Brendan Cavanagh

left short which you of as be hard so to commencement generalize long lease lot the of the - Well, the the in - date, final the the revenue most immediately execution your link that's is amendment missing because there's actually critical it's But element a the component be a critical a Ric. amendment can generalize an out document an from as question and date as from to is to as whether to application installation, greater really or which or future a upon then

Ric Prentiss

I really execution. have should said that lease up. meant I

Brendan Cavanagh

nine, execution outside. six Yeah, from usually months the to or

Ric Prentiss

guys. thanks Great,

Operator

Thank you.

Next at Del Please we ahead. go to go Nick Deo MoffettNathanson.

Nick Del Deo

question. my taking for thanks Hi,

anticipated give in they you've you but monetization into consistent negotiated other amendments the what you're coming for can't the for deployment you with consistent the us FirstNet past? get process that to recognize with are I and starting comparable numbers, are now First, rates

Mark DeRussy

greatly They requested. variety being equipment are of say are I and Wide would loads that very Nick. though they're

are from. And - the but of are coming from - are variety are zones wide. that which sites Given end the wide goalposts thought, pretty touched the averages it's circumstances we where being the the

Nick Del Deo

and holdings what we do is we a there I And do it. T-Mobile sharing of that onto spectrum T-Mobile, should know and revenue know don't it Sprint's than higher a a Yeah, spectrum I take fair average about there's appropriate the seems into Sprint/ only for of maybe moving mean involved versa. that band healthy sites think amount common, know be sort a sense. covering or to for, then it one we would their but in That think it's got are lot, potential early bit you package amendment Thanks mean, makes one rate given other I they're in factors consideration? vice like and on

Jeff Stoops

we multiple I single antenna see the a quite and there my a configuration product spectrum to no full actually at cover that that outcomes that antennas obviously deployed load weight of about spectrum MIMO today company, range so unit that To wide and will but the desired you're array you single that add of price, and of things certainly I'm impact on will the there bit like that not and there could that a knowledge think then depending Well, no the on there. by covers ultimately have to be that like. of if combined is the the what my so start range be to knowledge get - that to to could units configurations radio look expert, covers spectrum, unit looking the of the

Nick Del Deo

that's Thanks, Okay, helpful. Jeff.

Operator

next we with And go Please Flannery Morgan will ahead. to Simon Stanley. go

Simon Flannery

Thanks four? and of the other a said any latest big then big can about leasing talk Thanks. on little Brazil, from XX% restructuring lot. Oi what's Maybe you to specifically capital you interesting in that then their I markets think any the momentum four, just outside the momentum good was seeing Dish you're of trends and talked just about you good You or International their touch bit? on others plans on a - in could the

Jeff Stoops

continue plan will its fines, restructuring will network well. more and Oi decisions a and the so and to move agreement a June that's move I continues and that insist government believe be the allow they that be something for with on or intended. reaching an is as Anatel whether we're that's critical not obviously to make the date that we're of there something forward, to Yeah, where Oi resolution Oi some hopeful the forward on as optimistic start in debtors greatly watching. to will People capitalized expect investing emerge outstanding there

activity Simon not the terms but we or in be Peru, America long. think the We're in to just hot things, new others, Central countries Ecuador, certainly other that in good of one so activity Brazil's respect the see will initial sure to in region leasing big the generally bearing Dish while discussions two to with terms year of of is from every this it to starting with share In in country. with US relatively see continue And country, America at continued although Latin any We Central America. to the lion's come remainder year markets, a pleased and of be seems very all I'm the all good good given activity four. like time all year the of in there's very going far lot

Simon Flannery

Okay, thank you.

Operator

Thank you.

Next Philip to we'll Please go Cusick ahead. go JPMorgan. with

Philip Cusick

been last of been like Brendan a of versus of have thinking going you sort that how it range. little said give were seen guidance think over about you Hi shift the it only in as you guys, you leave months any sort it your sounded may how Thanks. couple there visibility we're about months? may into since since our us more have about it's I visibility Can you the last within where to talked of two but a guidance, you thanks. noticed bit guide unchanged,

Brendan Cavanagh

say expect grow, while to Yeah, been organic that we've could for we comment seen by hasn't enough that continue that see go there of component application and comfortably where the growth specific number our mean was and to good to activity we impact I XXXX. time well, backlogs really it

really to long, So things rest let's well the it hey, really are of going hasn't year so out. the an kind just plays was comment the of say, from how standpoint that been but and see operational

Philip Cusick

fair. That's a

Jeff Stoops

really and reported I incurred guidance consistent to not Phil, projected. wanted with say our approach just as of well that's

Philip Cusick

control, your or I XXbX the in was that mostly by driven if Makes sense [ph] buyback share the and then in said weakness April. to was second this shares? due count the in can, the under weakness something Was you

Brendan Cavanagh

a Was of little actually. bit both

Philip Cusick

thank you. Great,

Operator

ahead. Amir will And at go from question our Rozwadowski Barclays. next Please come

Amir Rozwadowski

Thank you, very much.

question in growth think you believe on point? about the for doctoring of seeing, sort that that you organic some room the the on rate are Just of activity growth about build based has Phil's we that improvement at this you're activity terms of that in if organic thinking do prior rate, seeing levels levels guys

Mark DeRussy

of was be for that that the first report tower gave growth clear same talk a month. we twelve to of represented previous we so the indicative rates, all rate that first trailing growth number quarter about growth really the when we the year-over-year, is Well,

been where through sequentially now, So than we're out it that we've individual see the yet the level higher on as on where we it similar seen gets the to is rate. not it to that today, comment, increase a we of earlier haven't forward signed year through and at to now, where last a continues expect is based in move increased so level up. But as not year assuming stretching to that something terms move what's isolated better to over exit we activity an we're much are we compared we to expect that which at of leasing Jeff's happening year certainly we the year, but quarter, would an get

Amir Rozwadowski

and constructed think opportunity for and they cells, or cells. small about of about of between day the their small really allocation that the of of to then perception a opportunity the that's of to get much, have of the some do going one of you sort we network? T-Mobile, the when from Sprint deployment That's small XG opportunity set versus Have towards the going helpful will Jeff. deal the If place that versus of networks comes with they are spectrum how did number think of about the go of the some Thanks sort or anything these I capital set material things set believe now? with sort back the talk it your taking new of cells decided very macro XX,XXX. changed market it to expansion how

Jeff Stoops

out numeric mean and assume a us Amir. to these cells continues that would be issue, for networks Not it there be very ROIC of sampling a in really. I small always we healthy

Amir Rozwadowski

the incremental for much very That's color. helpful. very That's

Operator

with And now we Walter ahead. go to Piecyk BTIG. go Please

Walter Piecyk

Thanks.

[indiscernible] for some Are it update $XX and million here domestic million XXXX? an that was year escalations that? color amendments was for think think in $XX on I the was you I - I it targets on provided still for those whether missed there

Jeff Stoops

the of last bridge $X That's our was same. there the which Those that They The number we from only numbers by churn domestically are in shifted organic we of reduced domestic million supplemental the haven't actually quarter. package growth. the changed. financial

Walter Piecyk

so that absolute forward? of gave going in okay, like, Got it's rate to to just it saying a going churn it's you just level just this it, be X.X% as terms opposed the

Jeff Stoops

Yeah. gave gave last as which months. same first did amount. for absolute prior the the year the the to dollar an of - bridge churn the of XX give rate, domestically indicative Yeah, tower rates, is is which given Well, we the but in we compared the quarter first we quarter X.X% basically growth was

So year be are but that end little the should higher, be item bit that although at where churn is of a of we - there slightly may the expected generally

Walter Piecyk

from When the we any is in first look at kind that periods, of quarter? of deviation escalations occurred have Like there versus in XX escalations? any that prior is growth could the

Jeff Stoops

less does No. the activity to having escalations. really It part include to - it variance from year. not of in latter is leasing It's but it any is in last due escalations, due

now more second expected increase in into as the the in we move as and year we So comments, are organic signing business to quarter. obviously the the first quarter prepared mentioned because up that's through

Walter Piecyk

in of Got maybe update or but I what's target that? to you again for see I and stuff hold then the a still that FFO I something the for the on the of missed any didn't bridges, guys supplemental bunch $XX reference you Does think XXXX.

Jeff Stoops

still still goal. goal, That's the the

Walter Piecyk

Still the goal?

Jeff Stoops

line goal, that. continue the the are march towards to backlogs towards we we Still that EBITDA with through and the still goal, The striving results Walter.

Walter Piecyk

But there body as confident, $XX don't to goal are to is change there XXXX? we any going know, to no to the opposed hey, to change. hit is I language in mean are I like, being it sounds strive in on like get a I mean something I one we that? there is thing this mean

Jeff Stoops

higher and headwinds see have Well, let's been of there. as line operational I really go the the through tailwinds through are on on tailwinds the mean I first are EBITDA believe stock versus some going and actual this things think From we 'XX, the three higher assumed. rates repurchases our time the to XX points activity. be I really, good the assume we where put we basis probably by XXX we interest multiples our forth

FX. So were on those are the where two headwinds about we or

bit of ahead still operations, there. headwind of all but all a still So are we little that's the and line, confident in the below on getting goal

Walter Piecyk

thank very much. Great, you

Jeff Stoops

Yeah.

Operator

question And from Spencer at go Street come Please ahead. Kurn our will next New Research.

Spencer Kurn

question. for Hey on the just guys. strategy. long-term taking have question Thanks I a

activity laying do I'm carry just - a about domestic sources which how So slowdown about five next strategies. growth looks may innovation as if ROIC? XX it growth, their you cells versus you years curious think some are laying lower competitors in the slightly small to developing groundwork macro of are of laying think to of in XX some other out like and your

Jeff Stoops

to growing continues looked of us through Well, we where has preferred share growth. and stock way be that our we've kind to drove kind activity view today. continues traded capital our are that the at allocation is Spencer, where be our to pursue previously, that international in of that's what And per and FFO of that

what folks doing line. our continue submit are that growth to the revenue on created will we to value is that better. better we doing by and be can want I ROIC to you Some the that see shareholders the for produce

out. I our think historical that results have borne

But are good to do trick for don't we we grow opportunities. at will looking we pressure feeling all. new continue to have what like line, the revenue in terms a of to investment down we any feel doing, find So to be

Spencer Kurn

so thanks Excellent, much.

Operator

we Next at ahead. Atkin Please go Jonathan will go RBC. to

Jonathan Atkin

ask time international generation between signings I a couple or executions about and to on questions. side. the Thanks, revenue lag of wanted the

specifically commentary if on deployments, and whether of pacing's the any think noticed difference of the any good interested in gave I with there's change customer? this the that answer, pacing's on you light there been versus of whether last you Castle but FirstNet have signings M&A Brazil? any has a both of kind in seeing Secondly and any quarter Crown changes in Thanks. and domestic

Jeff Stoops

The FirstNet last continue one the first. backlogs grow. take to I'll

little is that's and good the So to feelings grow to a continue backlogs difficult gives we have predict. future. that Timing more - good us for the sign. But application a

there there is In terms difference. international don't know of that I Is the timing, much Brendon?

Brendan Cavanagh

are certain but we timeframes, more lenient where times different. that generally… sign not materially commencements up maybe There It's are deals there

Jeff Stoops

That negotiated. would specifically be

Brendan Cavanagh

larger but as the negotiated of they same. basically part are maybe Specifically a agreement, otherwise

Jonathan Atkin

speak So upon signings of mid-quarter change continuing AT&T? nothing FirstNet the signings, since between was so deployments, FirstNet to any and good M&A when FirstNet the pace in Crown

Jeff Stoops

Not material, no.

Jonathan Atkin

And then secondly -

Jeff Stoops

- specific the signings. to That's that's

continuing are grow. the backlogs Now to

Jonathan Atkin

about wireless, then you Is you that comment integration didn't in other on unfold? of that. more and applicable deals that than think it I might talked Got any the some terms AT&T of how

Jeff Stoops

two applicable that the had. technologies totally similar those be almost least would that and given the spectrum companies think I

Jonathan Atkin

for on seeing competition in, more are in Okay. market multiples less multiples, commentary international you any and And then versus M&A receive the or the deals finally that Brazil domestic Latin that or on multiples, say, you US? any

Jeff Stoops

why multiples selective. why selective, dollars of in you high to portfolio be internationally all general not investible a stay which are we have high healthy we high, will have most domestically very Yeah, we continue or growth. likely bid stayed and And is we is very, but remains which there in feel to both are, invest our and

Jonathan Atkin

Thanks very much.

Operator

Barden Please David to ahead. now go Bank with of We'll America. go

David Barden

lot. a Thanks guys. Hey,

And approach to period and as One of certainly opportunity that of tower as helpful was think in any through little took. right this your XX% ahead later. approaches near-term you look Jeff, I and two look the you where of the T-Mobile what kind of kind potential second, that change loan, you a maybe a the why last. to to So there kind of little to they monetize tower ahead, combination kind the to the could might is in Brendon, then churn kind the of would thinking differently rate and a XX of shutdown Sprint we kind companies took the you there. variable as that's talk That if but at kind got much could basis you Thanks. think for combo, kind guys there on back churn that guess, that the just off paying would helpful be longer-term potential fixed rising debt not American circumstances versus rate point just you were financings, through. recent you different of It traded there? rising a new as did exposure kind term then of kind view financing your like think your sort Is loan reflection would approaches environment experience a of get network questions, kind consider be of of the seems If couple better XX% a to to of I you environment, it most going one? it on Sprint rate

Jeff Stoops

Yeah.

had It a Looking a component. which component. component come had was had network back of to at vision extension Dave, it components and component. not they - had deal churn a to which did pass. had the LightSquared It an different many It course - had then term that iDEN with Sprint, it

of all deal that totality for us. the really was it that four So made

So these going is we and would recipe We've on and for recipe deal based we will say But before time agreements the go circumstances. present more much again. fact, see. under variables we something –whether be and very through, deals forward. the sure. in very certainly that too But We'll it those or circumstances a to amenable right is that open at right it's four us do test. That would to for each was is type the not themselves the those facts again. done right a really right it's and that the hard There circumstances of them

Brendan Cavanagh

you a constantly XX% do fixed But And, from lot debt of we It's is we cost to is that one are rate debt that that have that range well, are say, that of comes David, tell to that you kind the XX% going thing of to not focused. have right more still rate on mix. would what evaluating targeted rate the whether fixed term that we historically are at where debt look or be. the alternative. looking at I and when loan, would we to is excluding

allows there include In collateralize also one beyond that that the ability us international assets is which the in to to markets market is US of go bank the addition, factors instance The just for do our interest rate the that. here.

And Not so financing. it's our assets securitization of a portion all our do are us logical place to well-suited of for the market. for a instance for

even alternatives, have efficient in our in effective, swaps six also fix that are to we alternative. through So rate look different refinancing continue also debt some is at that. component with when after because but market or that most our see of debt floating looking the terms for fixed pre-payable a mind And do we we from as most the do structure cost a bear better we that to we'll always if flexibility of it months freely rate that capital through debt and the

David Barden

- velocity rate that no of right Got increase rate informing that now? it is absolute that's and decision there

Brendan Cavanagh

totality, leverage obviously to our levels views that a together. it, overall if our But so continue fairly at specifically. fit those the Not view all affect they pace would way but rapid were it we might to affect factors accelerate on also might in

David Barden

guys. thanks great, Alright,

Operator

ahead. Brett we go with Sachs. will to Goldman Next go Please Feldman

Brett Feldman

the the for Two, is first question. quick. one Thanks taking

including you noted, a around the a then out there constructed considerable been is a just tower long domestic of products for On bigger there have a your it's curious towers And construction need to term allocation. new range source a X XX, just the I'm Is the as concentrated it Sprint years? very years, spread there remaining it operators of primary and number to of that question, private; be capital was six actually average the that since XG under are view is six is some time of a leases out? you And US lease in others. or newer term

whether think towards or curious you that more opportunity And I'm being an of putting the dollars to just are terms type for relative Thanks. attractive be your may that that to continue start construction asked alternatives? of whether to be so there

Jeff Stoops

take one will I Yeah, first. last the

and to will are opportunities. more believe, work terms be there going well. be but cases I are I Brett, as own their in many think There also going areas continue be in that go rural that some with to to conditions some there challenges that challenges, which pose do

Brendan Cavanagh

I well in say concentration years the the spread Yeah. so bigger the terms, of more seven-year than And, of timeframe, there terms are six there. are some that fairly in the There are why of that's out. certain others. years would ends up the and Brett, kind average are

Brett Feldman

I a follow-up mind, of the just have don't around sort you question If build-to-suit.

was the the to past so curious have paying that under? portfolios out to portfolios the that maniacally in in they towers in now because noted the under to portfolios the if up you attractive or finding you US. you done recently part didn't find of aren't actually towers reduce you been look just there are because past are those amounts bought terms and of you lower it You that there particularly construct any developers I'm lot down that the terms right you've road, decided which actually also potentially that have in building going a picking these attractive appetite of your

Jeff Stoops

interesting with money the and taken folks amounts some very very who disappointed at some had we have to We pay. conversations prepare then of terms have will those

Brett Feldman

you. Okay. Thank

Operator

Colby Next Cowen and we with Please ahead. to Company. go will go Synesael

Colby Synesael

I questions may. if Great, two

are that align is towers matter the or tower higher up, and does have investors, overlap both you. Verizon today, those of so the intending unique lower do as deal I'm revenue think and itself you XXXXX ultimately they I XXXXX otherwise mentioned to forma look that years? when also their higher Sprint then that that do number where now going that there with meaningfully you have that's you when number think have in that's AT&T would accounts need we have so the that and when to they Thank where anticipated? to a see at that on that a forward, are saw they compared look towards? about going that Sprint T-Mobile risk for T-Mobile you than what than per logic to is support curious many what Do or like is just put at decommission something companies And that would sector go basis to that or you a think potential

Jeff Stoops

of I the That's last X.XG great don't a The on promulgate know. clearly far. spectrum Colby, wants very interesting thus Sprint, knows which your question, to everybody doesn't T-Mobile make one. combined use

would much view layman's it I be see to X answer. it But already going the attitude the nice cup that XXXXX, needs. away a get to the going that knowing whether one quite capacity, or others of remains and prior has don't nickel iDEN and that know site And you of I the and detail is has potentially positive as and think thought nuanced significant that myself. of at combined except that and thinking. that maybe single requirements things every has that's kind Clearwire it's Metro the more ongoing the to that integrations - I will that some there day to network coffee. I'm to once gone get to So XG on to sure is satisfy have to have the level this offset That's be the of terms of this of really consists equipment or and but potential so But decommissioning will a they of of my just all anyway. of have everyone answer of that added company's end ultimately in get the of think to that happen not does, - intensity

Colby Synesael

adjust terms risk SPA slightly that just question, think churn could this best do ultimate the the still looking way deal? the for in think this revenue scenario from of the at to is worst-case in case about I you us overlap X% If

Jeff Stoops

Yes.

Colby Synesael

Great, thanks.

Operator

be will question of next go Please ahead. Niknam Deutsche Bank. from Matthew our And

Matthew Niknam

thanks Hi, for in. for you - getting thank me

on of a on one XG this have some think single Jeff, more you what's activity a give whether number early Is carrier or seeing from any the Thanks. there I rural color XG, more it's may you mentioned and of can carriers? in across Just driving markets.

Jeff Stoops

way which a the I get rural, non-urban in lower given of the non the as said, spectrum say way to XG. the MIMO Sprint/T-Mobile use highlighted and yesterday use millimeter antennas basically was wave the didn't the - I it's the to call to

talked see for and So happening, that applications so actually about. it we're starting they is what

Matthew Niknam

Thank you.

Jeff Stoops

Operator we one more for question. time have

Operator

Certainly ahead. from final will that at go question Batya Please come and Levi UBS.

Batya Levi

Great, thank you.

I think portfolio have you the multiples you function low grow more more to the at of the for outlook expected that that Is mentioned of room you range that opportunity you buyback? a to for leaving the X% end for the XX% see the the for or year.

Jeff Stoops

how as in No, if done we I we're this would given that point be already least to at much was year. - the - that going at the that impression do said, we've

than the more the the have what the end opportunity So of portfolio we grow to range. low

And Batya I've we which thing no what under low deals. the doubt the of hold earlier about will that back assuming is range will sensitivity and good getting have we to reason that discussed us We I will. surpass contract, everything close end price we the only

Batya Levi

Okay, thank you.

Jeff Stoops

you. Thank

Jeff Stoops

call. forward our we to I for and want look next thank everyone joining to us

Operator

Thank That today. does you participation Teleconference. and conclude your for our for for conference AT&T using

disconnect. You may now

SBA Communications (SBAC) 30 Apr 182018 Q1 Earnings call transcript