SBAC - Earnings call transcript Q2 2019 | SBA Communications Corporation

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the SBA Second Quarter Results Webcast. At this time, all participants are in a listen-only mode and later you will have an opportunity to ask questions. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to turn the conference over to our host, Mark DeRussy, Vice President of Finance. Please go ahead.

Mark DeRussy

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

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

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

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

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

to With that, Brendan. call turn the I'll over

Brendan Cavanagh

We Mark. leasing revenues were strong results and leasing and were financial Good you, quarter businesses. cash $XXX second $XXX.X GAAP Thank our services with evening. second a site quarter operating for and the Total both had in million, great million. leasing revenues site

previously exchange earnings with rates modestly rates average we've on our our for a headwind approximately also Foreign were comparisons. the leasing which quarter, first ago weaker estimates quarter revenues impacting release, second FX negatively than by were provided $XXX,XXX. year on

second X.X% X.X% the the X.X%. a which of calculated is On basis, over constant of the quarter, basis, growth second growth Same-tower gross recurring leasing was for was churn. revenue cash on a XXXX, of currency same-tower impact quarter including

the years gross basis, cash operational growth over point domestic leasing X leasing large related terminations. to X.X% activity of year of over growth Clearwire to on same-tower to of climbing churn, highest iDEN a consolidation Domestic continues continues in was net last to revenue leasing the including its our same-tower due revenue X.X% cash increase, X.X% and recurring Domestic which a on and quarter last basis year. be portion to a second Metro/Leap, strong recurring

representing and again revenue up was activity, domestic activity in leasing newly was in signed about operational the the quarter, with the XX% from coming signed during revenue high, solid up quarter. Domestic signed up Four Big again Four very carriers. XX% We new revenue represented the saw leasing total second leasing from contributions quarter. new particular Amendment each from very incremental leases. Big amendments carriers XX% of of domestic during The

leasing our contributions from We also operational new domestic to continued have activity DISH. to executions with lease

coming continues with every the to day, applications backlog confidence the for giving strong be in new year. us domestic of Our remainder

organic of was same-tower same-tower a four continue Internationally, to another have solid in all on Gross including or Brazil growth carriers gross was the leasing there. X.X% constant-currency with contributions and XX.X% on largest XX.X%, solid major a constant-currency contributor. basis. basis, a on We churn revenue internationally, leasing had from cash quarter Brazil basis, XX% growth we

XX.X% XX.X% expenses. U.S. revenues the of of denominated Brazil, with the quarter excluding from all leasing of majority and of consolidated revenue was site non-U.S representing was site site quarter, leasing revenue, cash during second dollars. in Brazil revenue pass-through During revenues cash cash leasing dollar-denominated from X.X% The

with our couple of second continue expectations. previous but see the as little quarter to churn Clearwire with leases to regard churn, With a than we from and higher quarters Metro/Leap consistent

two from of and rate over approximately recurring annual with As churn to expect revenue leases next that Clearwire years. run we of the ultimately $X million quarter-end, have off Metro/Leap we

at leases, from which to continue the certain impact X.X%, end on numbers tenants Domestic churn more impact long-held non-consolidation quarter. estimation quarter basis second one an churn of churn from other the of was annual million approximately same-tower X.X% legacy of all of to reported churn. of affect of include same-tower our X% high of the the iDEN-related our for quarter fourth annualized the in annual churn will our $X XXXX in Also, incurred results same-tower

Tower the $XXX.X flow quarter million. was for cash second

tower quarter. domestic XX.X% was International pass-through margin flow flow cash excluding margin expenses. impact was in cash the XX.X% tower XX.X% the reimbursable industry-leading and Our of was

Adjusted was the quarter second $XXX.X EBITDA in million.

almost EBITDA much quarter over year second results ago leasing gross Our quarter Services period. adjusted up profit services XX.X% $XX.X strong XXXX, as were in services again in the both by quarter driven of in the were businesses. and million, our twice the driving as performances the second revenues

our Our adjusted from to EBITDA quarter, the services was margin XX.X% larger due in down contribution year-over-year business. slightly the

from Excluding the of of was quarter in of second tower our the was currency in million. margin total attributable AFFO $X.XX, AFFO was EBITDA constant basis. share adjusted XX% adjusted of was second our EBITDA expenses, leasing on quarter business quarter. or pass-through revenues per a the impact the XX.X% second increase XX.X%. XX.X% $XXX.X over Approximately an to XXXX

invest in for tower our portfolio, XX sites to acquiring million building continued communication XX we and sites. $XX quarter, second expanding the During

Subsequent All and acquired for of were end sites sites million. $XX.X built located quarter, in located the sites XX the of U.S., of additional to internationally. the the the were most we acquired

today, XXX aggregate $XX.X end million. of of under closing we have the contract sites for XXXX As anticipate of an additional the and quarter on first acquisition of price by at

of all joint with include development. the Africa, quarter, discuss will moment. in updated South more in anticipated The the intends with has addition, in approximately The a Tower the to option close impact operates sites, to Africa. acquisition third to transaction more company's unconsolidated Jeff XXX detail the this of throughout previously its in venture sites quarter, acquire a currently owns transaction. In Atlas and X% South been and is outlook this many joint the but company during exercise third to XXXX venture

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

During buy land aggregate ground to $XX.X and the quarter, to of easements extend spent an we million terms. lease and

more the remaining towers. under life for owned controlled leases, than ground end control, is options our the under years. our XX the XX% including XX our of approximately At underneath or years average And we approximately renewal land the of quarter,

full outlook XXXX. we for today's our In earnings year release, press updated included

outlook across site in some organic We to the as and modest FX well have increased We inorganic anticipate both improvements board. rates. increases leasing assumed in growth due as our future

organic both due to volumes earlier higher leasing in average growth rental are and Increases timing of commencements.

lease of Given impact result revenue commencement, leasing the delay guidance Sprint/T-Mobile any typical our time as merger. we executions material between XXXX not and do a expect the to

is by being Inorganic growth South in, consolidation in investment joint outlook of, African primarily our increased and boosted venture. our our

healthy results strong our due We business from services also QX contributions anticipate to to our our and incremental our performance backlogs.

slowdown improved of the XXXX year second cash guidance the net balance half anticipated due results in Sprint/T-Mobile AFFO to non-discretionary outlook taxes. and contemplates The a in full our the has still interest services expense, better been for of our also cash for year However, merger. CapEx

our today, will be as we to September are earnings XXXX, XXXX. quarterly now, XXth, initiating in share, per be XX, common of record press excited gears $X.XX a of our to announced release dividend on August a initial close of formally the business to The payment dividend payable payment earlier Shifting stockholders. at shareholders

losses, were up XXXX, requirement to all to we conversion eventual operating which XXXX. million have a using discussed $XXX of federal our net our upon as pay of dividend in a our year-end existing regularly After REIT

previously As the discussed, was this anticipated XXXX. timing for

reasons. of these timing the quarterly shift several to distributions for decided initiating cash have We

almost greater in early to of dividend the amount of in our pay all the allow period XX approximately commencing in months or earlier following will flexibility the pace we out simply us all growth dividend rather pay required commencement income. First, than the and taxable the being

a for the The extended dividend time. to our earlier in period opportunity preserve providing time, steady, dividend allow will portion NOLs turn longer have more us substantial period of of to over an of a growth us

for and at growth of the in dividend this expectation business, based the dividend our our believe XX% future our we next commencement several years. least by can on With we grow for annually

have dividend investors it cash investment we now plan price allow other traditional who investor the investors flow-generating and REIT that reason our businesses. transition second The to continue is free us commenced objectives to more to base have that will

REIT, now place on plan our facilitate income of smoother stream. long-term, growth to other will predictable investor may base and premium continue and the classes We broaden the from income, growth, our transition believe investors, a equity investor that commencing a telecom a traditional dividend also dividend

thirdly, now initiating building our strategic than or level, is which require opportunistically of a high-quality changes any and dividend acquiring and well us as initial requires focus The stock. dividend no back on current quarterly to less business. And AFFO changes leverage assets operational will our will to allow XX% buying not our still as in share, per

will if to of not strong flow, incremental these The amount great liquidity, opportunities. substantial investment significant flexibility and our cash high-quality, us debt historically significant to Our opportunities arise. ability and dividend access capital pursue all when impact give internally-generated financial

to many to shareholders return tool to value years have We are excited a our to new come. for

Mark, turn to liquidity our provide things sheet. position an balance I over who update will now will and on

Mark DeRussy

Brendan. debt; Thanks quarter cash short-term short-term and investments; with of cash, $X.X million net billion the $X.X total ended and restricted $XXX of debt. second SBA cash equivalents, of billion

debt EBITDA to of X.X was of adjusted annualized just X.X times, net to six times. end range targeted Our ratio our below leverage low the

interest debt is cash years. our expense weighted average was average maturity quarter is net interest of ratio and our second times. cash X.X%, EBITDA four Our X.X outstanding coverage adjusted of coupon The net weighted to approximately

no under our have As of amounts revolver. we today, committed $X.XX billion outstanding

a into four-year $XXX X.XX%, the interest effectively Loan interest outstanding this at Term will one continue about basis XX rate loan B plus entered we the under below fixing basis paying Term today. portion million rate our XXrd, May XXX points we expense points. our is our of interest B portion term to On Loan swap, on The month unhedged LIBOR accrue of are at which

transaction, this debt result approximately a is of fixed. As XX% our of outstanding

stock of purchased second million a $XXX.XX. which per $XXX average of of plan, quarter, our we new prior a authorized authorization price repurchase million. common $X to the replacing our of stock end, X.X July XXth, or Subsequent $X Directors remaining had the share on $XX.X for billion shares billion plan, Board million an During quarter

the Shares stock our up time plan Rule management's or through retired. open plan under billion XXb-XX market repurchased new privately A discretion. negotiated The to will the authorizes $X of compliance Class purchase company with common outstanding repurchases time from be to transaction in to at in

of sole otherwise Directors the in part plan any Board by The deadline of Stock at integral time will modified remain to its an terminated until has repurchases our discretion. company's new continue or continue no strategy. and

XXX.X XXth, at from outstanding June XXXX. XXXX, are XXth, which is down million, shares XXX.X X.X% million at June Our

So, with that, over Jeff. I'll now turn to the call

Jeff Stoops

a Thanks evening great Mark quarter, financially everyone. our own We and expectations operationally. second and both truly had good exceeding

SBA's from and both revenue results the financial quarterly For time we history, of reported our the strong in segments. first reflecting million, leasing $XXX services

constant-currency basis. activity a of us level both of moving segments these year. helped and high and in leasing into grow the share of very per strength operating by second The services, backlogs on results AFFO The half healthy our XX.X% both the have was

outlook As all we full increased for metrics. our a have year result, XXXX key

While and the T-Mobile/Sprint our XG-ready wireless to regarding be years. is on customers with next little the the the we several in supporting of networks approval recent DOJ it of build related looking of implications a forward able to efforts all are nationwide the to comment out over early specific high-quality, DISH, announcements merger the transactions to their

We insure will this meet. nationwide to significant of have positive carriers, which of deadlines believe the terms facilities-based as deployment merger four final contemplated nationwide are two they

tower All the for of industry. this positive is

for customers for network position network our working with will their our significant Our network by XG the high-quality, nationwide investment our place large-scale well customers existing and SBA that deployments. very strong take relationships

predominantly to deployment carriers, four quarters over amendments. contributions few All the last major into activity Activity domestically, experienced were the continued quarter and quarter. results significant wireless with active the on as from sites bands, operational our tower of builds spectrum remains we've leasing technology our quarter well upgrades. new second capacity DISH, as the Returning at U.S. strong second during focused

tower mid-band of organic As business as component and additional XG to nationwide growth ability are activity accelerates capture networks, remain recognition the the with in our confident a primary and years provide in well XG positioned to network of service spectrum industry and macro come. we to low- for the increasing

Brazil. new Internationally, solid quarter another markets and The signed came particularly markets, during up we about amendments. leasing this XX% across contributions also our with contractual from quarter international steady all leases XX% in revenue had from of our

the Brazilian more the and quarters, we conservative for carriers last actually seems year from levels. in to as solid had Brazil. four rest Brazilian all around current a have the The major can few have our to you And expectation settled rebounded contributions tell the around economy the as once of some in wireless for outlook, put Similar has from we've reals. again improved in reals prospects

operational, international to in outside and are we with our are financial line that, our bring in legal the operations Western believe announce very markets. We Africa, we South identifying in returns the and markets In expertise good these maximize to high-potential excited first Hemisphere.

As Atlas Tower to Tower mentioned option exercise has all venture. joint years. South previously four unconsolidated Africa Africa, in X% acquire approximately for a Atlas to our we intend earlier, of invested but been SBA South

a build his a have for wife, and and per that has Randi, known talented deep first-class tenancy And new Foster. with that during CEO an at Nate a tower by of is XX operate assets have current I that Nate team relationships. years, built Atlas customer of time, tremendously through site led tower. primarily approximately Atlas towers X.X builds tower grown tenants to average XXX

upcoming to Atlas. be invested $XXX million a have we approximately in amounts closing, the with will Including in connection cumulative paid

first is and will after operation Atlas the $XX immediately tower AFFO share. $XX acquisition annual Atlas generate of neutral revenue adjusted current EBITDA flow all leverage million, be million exchange our expected date, rates. to of cash accretive million, approximately full ratio approximately the $XX and approximately using year to to leasing closing of During of per

significant from tell growth this can quite attractive, there but returns believe the you investment opportunity As already in those is financial numbers, Africa. we South high-quality additional for on are

which number these cell will of their least MTN, we efforts. of as of Telkom still carriers, a XG, well continue Four: next Big at the Mobile, has are anticipate wireless on Africa South for couple process active Cell including C. as implementing in the focusing and All years carriers Vodacom, densification

spectrum expect anticipated very the busy These projects, us deployments, in ultimately keep will for we addition to new future. options and foreseeable XG

New soon X.X megahertz XXX spectrum options in South expected gigahertz Africa. of are XXX and megahertz,

of that well a of and stable availability healthy for South are wireless suited power. electric also tower to an rule has law, addition Africa characteristics business, land-use including regulations In the active market, and other established direct

relates and the each connected are sub-Saharan it is major the own meter, power markets. difference power, to virtually all sites As African has from other customer power tower their of all grid, which a to

and made this on quality the portfolio In from early high both focus has on joint involvement of Atlas the management the addition, the venture us built. and this experience with quality very our the market. towers being We allowed witness contracts in of to the top team their believe has the

we particularly recently completed elections, foreign From are desire of prospects we to a Africa, the as the investment. businesses be critical about with macro business, like the infrastructure to level, well South optimistic with focused for expect an as those infrastructure on administration supportive attract that communications

years. over in Our a been three relatively contracts South currency and African steady the past which the the are expenses has denominated all operating dollar U.S. against rand,

we business. a exactly We're our We incremental access growing truly the progress Africa towards forward thrilled capital local to tower market organically strong our well-scaled to is This high-growth Africa. shareholders. high-returning track high-quality drive South record the several value new be South who type gives reporting and us in It the team next years. has allocating a see a a of on for of assets portfolio that over look in growth to

an for operating made strength for us of easy line along the financial thinking to dividend, on created dividend. one to Brendan our now, flexibility exciting but us begin is value managing from The SBA its it the today. create is went the future of to way bottom cash believe Moving most declared with for a decision through initiating another dividend for announcement and our condition, cash simply results first our around shareholders. it today another, we

existing new our us to in invest allow to ability continue current dividend while balance NOL and our initial the in benefit share of repurchases incremental to assets same the level still meaningfully the shareholders. The providing

pleased to of list shareholders. to very target return to are We ways value to the dividends our add we

now our complete. With creation dividend, shareholders the for is our a initiation toolkit for value additional of

largely to allocation. as Our recipe capital the for slightly value but maximizing shareholder stays same changes

we First, have on focus laser operational will continue to excellence always we a have. as

our and to will that continue and sheet, optimize goal position strength. we to Second, of we leverage continue a from appropriately great balance to look pursue

optimization drives target of sheet allocation capital amount each the Balance year.

is keeping of the REIT satisfying our priority yet is vast With our to requirements. first we for majority of reason dividend, grow requirement way, the materially our distribution year, the initiation along This available AFFO the the ahead the each now of dividend growth. REIT dividend while the primary our started portfolio why

growth that exceeds is Our quality portfolio or our next investment meets priority criteria.

to perfect continue U.S. Our this of we South types tower portfolio of quarter the African acquisitions will see. are our news and growth examples

we have as our that we we remaining believe it intrinsic value. to below quarter. extent the this of Finally, allocation; some where capital is repurchase stock did trading for available will well We

a tools So, use shareholder dividend, example value. represents the of initiation this to with three the additional all of of our quarter, allocation great capital create

We've are customers employees had like Caroline, of questions. contributions XXXX a for for great ready thank excited their about And first to what holds our success. the for with I'd we're our SBA. to and and our that, future half

Operator

Thank you. Instructions] [Operator

have a from ahead. question the line Please go do Levi UBS of We Batya Company. from

Batya Levi

Maybe Great. one question. Thank you.

how your you us If to think that potentially spend. see Sprint's you and could decommissioning that impact? remind quickly And could you do T-Mobile's exposure

than how And they others from benefit positioned are at accretion? do I from you into they're be will to DISH you And that you spend? been planning that quickly able deployment, network. that going looking -- announcing had you've Thank growth see revenue to incremental more you're guess how potential potentially the insight think think to How do the tower you. they've

Brendan Cavanagh

years. put But X.X% Sprint both press companies of on the did T-Mobile in terms information Sprint represents leases release. the T-Mobile, in same for revenue, overlap, have T-Mobile cash site our years. is X.X leases average -- Sprint dates remaining on those site, the represents actually the and site. so fairly it on we it's leasing X.X%, size. of consolidated X.X on for And term equivalent Batya, and is the the And

So that. there DISH? immediate from be impact any wouldn't

Jeff Stoops

look DISH, I And the guess, have would that well Yes. been will to very only I deal will particularly excellent there they as relationship amount was efforts. guess what consideration of on be will believe, would also than suit what Sprint/T-Mobile to look new from will fair the us divested like at an narrowband going network has because But do their this on I future. it network DISH, a their firms, part that point, IoT the under say we going to for that would a I this with and forward believe what, their and different want prior under be would look like their

with So, to the you time goes are have be to some to that clarity I is to be. DISH's can time going have there's think exact frame by and before what plans be got on going

Batya Levi

Thank Okay. you.

Operator

Company. the question of ahead. have we Next, a go from line Synesael Colby from Please Cowen and

Colby Synesael

on I Great. that. a just guess follow-up so

then them? on narrowband leasing in a have now theory, they're, guess, So, no impact from be pause I the with that network, going IoT DISH And for which it could you're to in expectations? in that seeing sites longer you some could your theory, possible of we is see their demand terms pursuing. actually Is

something will, traditional if dollar IoT can the more shift commitment, leases to then did happen leases more dollars allows or any extent network, that the the those cancel sign to that from was -- shift And they using into leases for a provision those point, network? were like this to them the that either you towards that maybe they in there then they narrowband

But you now this that's could And know really there in you possible that this for countries one-off, way? Or there. and into then mentioned Thank you. we a it of we see it secondly and very separately Africa, is I other already going that is that think and is should relationship Africa? a unique South is

Jeff Stoops

globe, South this Africa. It's every into around we're but which is like South point to the do continue any Africa, anything to beyond don't place we not. to to our we Well, have decided at plans job go evaluate

the So, nothing stay horizon on today, tuned. but

concerned, their is any DISH particular are like they -- the terms. something have regular don't this, as far have outs leases as And They Colby. for

is So, we'll big -- kind It's pretty a yes, change. mean, network I have this to of them. this see for a what different

all we'll does have this their see forward. what So, going to efforts to

far on we've in is that anything But that guidance done lag left financial given, as operational impact there's outlook the to operationally our statement. not as that concerned, affects be and lease-up the is between XXXX given really the the

with out. very whatever the So, that put happens, we've new outlook we're comfortable

Colby Synesael

Great. Thank you.

Operator

the Next, Cusick ahead. of go JPMorgan. from we Philip line have question a from Please

Unidentified Analyst

for Phil. Thank [Indiscernible] is you question. may. my This for if Hi, Two, taking I

to quarters. has to over First, we churn you're Can elevated fall past the domestic more still talk there? X about the And you trends few expect been little a seeing after should XQ? iDEN

and secondly of of very a revenue. shift activity networks? leasing then architect in percentage which carriers a are Is separately, choosing site Thanks in as pickup much. course of normal their leasing reflection we've development And way this a site seen a a maybe or to

Brendan Cavanagh

churn question. the Yes. I'll take

On been was expect the the from there side, that that October do of of year. event churn quarter last behavior iDEN Xst in anybody. most no domestic churn, change fourth on happened has We

So, XX when trailing impact you the report giving months. we're basically we that, over

more drop basis. would we and it to When the quarter, quarter, that year-over-year zero. show we'll fourth will probably time one we get So, third a next expect on quarter that the to

our In uptick, -- X% in with really than that. terms might slight seen given It higher non-consolidation still it's range to other of slightly X.X% we've annual but we're churn, We've comfortable issue. a churn the period. be timing a a

As with level you've but slightly years. still past, we're seen also lower, that the the a been of comfortable in being for coming kind normal it's

Jeff Stoops

lot not do customers from doing several were I business half first the services is that there's in a now question? we have Caroline, it did as of which in And reflects level Sprint, discussed really of their customer. change really network. the we what we're for that not services, we've in with XXXX same the of another half. particular quarters, second mean any architect contemplating our way business And Yes. respect to we

Operator

from do, line We Please of ahead. Morgan go Simon Flannery the from Stanley.

Simon Flannery

Great. leverage can initiated more now just that you into in talked about you've talk you've think policy Brendan, Thanks much. of dividend? getting a I the the past, mid-Xs. very kind about the it

update any So, there?

I a And you perhaps, et on AT&T environment. towers. broader in you towers potentially valuations, the bought What Jeff, think U.S., about selling talked just comment of some there M&A the Thanks. last In supply cetera? terms seeing week. some are and

Brendan Cavanagh

past have On the what We Simon, obviously leverage, said on would is that turns. reported handle we six to look in today. we it. the have have something that a with actually X.X We

it's to more by close probably more be think to to I towards the but target of would repurchases, in growth add opportunities quality going driven really historical end expect forward. to still to be we X% but lower to range continue X.X% going share our portfolio

Jeff Stoops

try both, to very, very, sites; we And very second high-quality bought the be I will good M&A are of quarter be things good can think, highest that there. competitive We were The we continues types Simon, there, Mid-Atlantic opportunities. to growth area site. have -- that on around find out sites opportunities. tentacles tend Yes. experienced that tend which of but environment, you a lot out focus quality particular competitive, focus we to and over we The those to the years. if are you're the enjoy good tough have on think the sites we kind of in the extremely will zoning; Those very

globally picky, be there's fits and seek of so enough asset but there there have company we've continue to out over on the for achieve that the you time. we'll to bill, careful built and everything kind to out high-quality exclusive that us characteristics Not

Simon Flannery

Great.

years? XX% goal that have X% the still over you next So, few to

Jeff Stoops

for I into don't and We'll why go year, be it know well. do. going We a as wouldn't it hit year sure, this next

Simon Flannery

Thanks a lot.

Operator

Instructions] [Operator

MoffettNathanson. have from a of do Deo the ahead. line from Del question go Please Nick We

Nick Del Deo

taking for thanks my Hey question.

been stake Atlas, And yields few going talk development the leadership spending share company? in can to there. getting? in of Regarding and sort the One, team and new three, QX remain build for how bring you questions a to of about much you the place? what ownerships they've runway Two, are up is

Jeff Stoops

Nick. cover and not last between Fosters. That's one, be the We're to to the us going got

first As all and staying South arrangements they question, yes, with four are carriers. relationships of to the on, build-to-suit the the have African they and --

So, this this in that Four will -- all built, annual continue, they and the been clip. opportunity of Big fairly amounts were That of -- in for is for South most varying and were the running towers a Africa. beauty they've these high built at

we goes So, XXX the here future. the beyond in that expect not-too-distant X,XXX and to

Nick Del Deo

Okay. the development And on any commentary yields?

Jeff Stoops

yields? Development

Nick Del Deo

Yes, sure. sure,

Jeff Stoops

yields? Day mean You the one of day one?

Nick Del Deo

share. anything Yes, you and can kind of

Jeff Stoops

Yes.

high they low day think I be would perhaps single-digits or double-digit on one.

Nick Del Deo

tower, Got it. do general, acquisitions by by value when go a switching and framework what you useful lease DISH gears I at I is think Yes, And bit, upstart lease. guess, sort to tower then of you understand look be as in might because How through guess underwrite you for from you mean general guys. your might it to players? what trying established carriers relative I'm we contributions

Jeff Stoops

them? value we How

Nick Del Deo

upstarts puts versus are and takes established the what Yes, consider for players? you

Jeff Stoops

that buying for Are you Are them? Well, which whether you've you down to capital. building for wildly you're spent you in. have leasing up fall space on already Or depending camps are of it simply money. That's -- you different on those that and asset outcome really allocating comes them? that's you available a

Brendan Cavanagh

to we're But vast so sites, just decision of a last available not say whether our that that and there's when potential for be might going deal to quality are. we're I'm decision credit the making. there any user space it's the on leasing we're I majority if sorry, a of that not really our making evaluate who we was obviously sites Nick, remaining capacity existing

Nick Del Deo

was trying the It okay. commentary for Brendan. Okay, the Thanks was Jeff to get point latter and I to.

Operator

Next, go Rollins question line from the we from Please of have Citi. Michael ahead. a

Michael Rollins

could. and good thanks I Two, Hi, afternoon. if

an U.S. from give versus with respect the activity update what to new can you leasing you're in seeing if First, us site on colo amendment.

they your it's company seeing And opportunity had any for second, I in investors, more of as a Thanks. to been the like base. terms of to investor you what quarters, about invest think them a do are capital. in with as I'm broadening last you change couple way you talking whether to an curious, you've you've over your the of priorities would allocate or talk

Brendan Cavanagh

was On quarters over the pretty the this years. in in think XX% it colos the last up amendments our the U.S.; was two which of comment versus new in it's actually what signed the That the to terms been few quarter, of is where last was mentioned we I amendment. business it that U.S., relative high we over in approximately or

speaking, last always been recent periods. a higher little gone probably than couple highest colos, over a the of probably in five-plus higher had we've but bit And years. in that's have, years Amendments has generally the it new

but to see, we'll activity to of kind our of in. that involved expect see mix the customers types are that continue So, given would we

Jeff Stoops

we investor. That Yes, Mike, are more the on seeing investor your dividend. infrastructure some looks typically second question, REIT for kind of of traditional

pay of and a internal did fact, from they investors have we number In interested said had we very not who but a policies previously because dividend. interested their charters precluded were

minimal maximizing subject lower dividend dividend our obviously each internal AFFO that going a it was was in REIT we at or other a our bias it towards left on the such going our investment, that for side case, geared made that But to clear be requirements. policy to was

provide satisfy be and growing seemed for everybody understood they they time to fast And with requirement that, dividend over were dividend. that was that the because also a going very that very looking to happy

and lot today part part, entirely, that were did with. we but folks you in large meeting what was not recently new responsive So, -- of a we've that class to been about inquiring of in large

Michael Rollins

very Thanks much.

Operator

Please New a from Street Research. question line ahead. of we go Kurn And Spencer the have from

Spencer Kurn

for want on follow-up thanks question. I the leverage. to Hey taking

about considerations today. grows So, have the talk so a you I six off, of in handle five have can -- think know talk you just mean Can as foreseeable about should we over you future? high-Xs the you being your ratio the make leverage first sort years? to in then next the for And I you about payout

Jeff Stoops

We definitely that. consider have to

that for is smaller to reason years. ratio it As payouts smaller grows, payout keeps another more because the the start

see factor we again rates higher be lower than lower. We'll appear out, leverage interest where -- is there rather settle interest Spencer. and definitely Big ultimately or that to in, where So, a comes was higher. rates where whether factor, it's headed

bode a to lower handle. So, six that's higher going perhaps handle a six towards than

before, have factored But had structure equity But there. that most calls a as of rewarding and the our the flows, where basic from no instead in we cash It's now the we call of holders, back changed. leverage before. in we thing for on capital we that hasn't premise then dividend same the

Spencer Kurn

expecting to second network do just see you're what sense. And T-Mobile. ratchet merger? new tend makes their about Sprint Could on it, Or for plans? a up can of carriers you result I run Got consolidate, thoughts a spending talk when gears and a they if you just as you in Thanks. might before through switch pause just that to

Jeff Stoops

a XG Well, part don't any instructed be going transaction, because is of the date-specific for be must three ever requirements of covered that the service the are I within here have none years. know that that percentage to the population Sprint/T-Mobile coverage the had aggressive historical consolidation

lot activity So, be on. a going I to early of think there's

Spencer Kurn

this just consistent levels opportunity more rest for What the to year? do nice sequential And me. the imply new for had second the you guidance for it to the leasing the Pretty U.S. Thanks. from you it. It does or in quarter. Got your rise rest like of one see of with looks continue activity year? increase the in quarter a

Brendan Cavanagh

of are numbers the second that for during on the the quarter we the the we the consistent guidance half where domestic with were you're percentage, fairly standpoint that bridge, second would imply based in where year. that it our from the growth about be will talking of Yes, assume set implied and same-tower I'd is sort

Spencer Kurn

you. Thank Great.

Operator

And next, we a have David Bank line question of from from of America. ahead. Please go the Barden

David Barden

one Hey Mark. just guess guys. Brendan I Thanks. or for

point, have I think, we year from again. bit that now a this to refinancing, expressed your seem to kind XX% be done you've at said you surprise where rates of Jeff's That of XX% you're little a you with comfort Historically, ago. level be kind variable. that might fixed. Mark, of And down were trending your a

the as of fix it is kind is down again? now? more year? for rates Is that to Or can it are just everything become coming incrementally look what next we strategy ahead So, we to the back now variable Thanks.

Brendan Cavanagh

to what we've done. don't more we -- we're already than planning fix anything Yes, not

you the quite But floating where sense expect mature it. makes and for stay not debt, it any our history for how whether part, to now to For come our it due our point I bank throughout most at is rates refinance Depending see think evaluate would on has exposure to through that should some about time. there, it move is. we

David Barden

you affordable I expectations with guess kind of just able kind the is, to for in kind -- that on government not bows of Brazil are the some see potential and now see being the the make And for expect of kind be then to tightening? are in kind question there hedging reals? ride future, you And kind of of know, market are maybe kind or foreseeable just and respect would could of you of wane opportunities and in the marketplace banking And more to call on arrows prepared it to reals Great. out? to your you don't right I the

Jeff Stoops

the a may of What a but only will telecom -- of which -- favorable not one I is to the our that we benefit haven't entire economic accord, all we're unlocks in which of we Well, let's there. vote strengthening a part believe against reform. that its dollar, down pension world wireless the result of not U.S. suggested really also And believe be just possibility strong the weaken own down a you that could moves think very we of currency there favorable away. regulation, outlook. if has happens, kinds is what

There's are ago. the things cusp to favorable already pretty on in are of actually been a number right very it's market kind down it's where several good of that that and there, years relative actually a occurring of

David Barden

great. Okay, Jeff. Thanks

Jeff Stoops

the the viable. the but done to against a I successfully add U.S., by I that. whole dollar ahead know just there, Carol. becomes don't that's I any know no but people economically down don't Go ever your that mean, if like know would could results I that, -- believe company of improve reals would ever I that matter cost of hedging operationally

Operator

the Please And we go do have ahead. of Brandon a Markets. line from from Capital question Nispel KeyBanc

Brandon Nispel

T-Mobile/Sprint, talk activity. I'm Okay, sweet. your of to backlog I'm going curious but about not on

terms leases remind new In a increase? backlog maybe year level seen you it's compared And ago? of signed us of but where not we commenced, have to at could that

And then another one.

constraints of could what coming, the potential of Thanks. terms tower that of terms in shortages climbers? guess be do coming? key are the I any Just amount in see activity you labor

Jeff Stoops

Yes. Backlog that pace year is short but activity climbers are are to somewhat the a ago. other and probably at premium And otherwise to a and tower up be be able flat resources done. probably of ago, from six and months would restraining

Brandon Nispel

Great. Thanks.

Operator

the And there question are no further questions queue. in

Jeff Stoops

us Well, joining reporting everyone we appreciate next our Great. call. look quarter's Thank to we you. and forward

Operator

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SBA Communications (SBAC) 29 Jul 192019 Q2 Earnings call transcript