SBAC - Earnings call transcript Q3 2020 | SBA Communications Corporation

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the SBA Third Quarter Results Conference. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to our host, Vice President of Finance, Mark DeRussy. Please go ahead.

Mark DeRussy

Rich. you, Thank thank quarter and joining for us Good earnings you conference third XXXX call. SBA’s evening for

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

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

as may are X, we statements November Our of any so have today, update to forward-looking no make. obligation statement we

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

Brendan Cavanagh

once very revenues cash for all revenues quarter SBA Total million. leasing leasing key site evening. in $XXX.X Good $XXX.X million GAAP were again financial expectations were in Mark. strong the the quarter, our had site Thanks metrics. exceeding third and results third

of contract the of On basis, X.X%. is was tower growth over $XX.X to in the rates constant same basis, Domestic churn. with revenue third the quarter third driven backlog, growth rate X.X% including including a activity basis, of cash XXXX, below first revenues and new Foreign Based million on gross calculated bookings were in quarter, growth on impacting last bookings customers forecasted application seeing net on the year continue year-over-year we revenue operational to for impact million half again by quarter on leasing activity increased and during third new by headwind Domestic a this third tower in tower was third comparison leasing T-Mobile. quarter quarter leasing primarily increase XXXX. with They recurring in the growth compared or remains $X a were of X.X% The recurring on our however gross on over previously domestic was levels, exchange were increase which increased over a estimates X.X% quarter X.X% activity with our cash seeing year, a period. into placed of but quarter. levels and third our same basis. a when the was we ago representing sequential under conversations to the tailwind FX for a the fourth continued basis X.X% anticipate Same XXXX churn. revenues the significant of of currency revenue negatively domestic the XXXX,

During large the from the amendment represented from XX% domestic our coming of revenue signed-up bookings new majority third amendments, X.X%, a activity The carriers tower XX% currency of Big quarter, newly including basis. leases. X leasing revenue XX% leasing with a gross X.X% remained the revenue domestic domestic total Internationally, signed was during up churn constant on incremental basis, quarter. growth and same cash X.X% of or on leasing

COVID-related modestly still first our levels, by customers half activity impacted markets. a remains by over of up leasing international XXXX number continued our Our was but reductions in spending

growth to was basis. currency was lease international on tower a This Gross Brazil quarter, Brazil contributor in organic up. X% again same the largest constant

was flow the $XXX.X site leasing The pass revenues for denominated denominated of million. was XX% and quarter, leasing non-U.S. cash expenses. Tower from excluding third revenues cash quarter quarter, from majority leasing all U.S. XX.X% of X% with revenue revenue dollars the of fee dollars. site cash Brazil, in cash During through Brazil the consolidated site of third during was revenue representing

margin EBITDA cash Our in margin Adjusted International the quarter or of pass-through reimbursable $XXX.X the flow cash third lead margins and impact XX.X% cash expenses. was million. flow of excluding Tower quarter XX% an continue Tower flow with a third tower of industry Domestic XX.X% to the

basis XX.X% Our was industry-leading year in adjusted the margin quarter, EBITDA the up from points XX prior period.

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

Our resulting new reduced of of the notional interest outperformance portion hedge This with value a our on for XXXX company’s billion $X.XX in termination in combination to loan cash was of rate partially in net expense, cash exchange a term one-time attributable entered payment billion a interest of million. termination $XXX.X into swap AFFO of in is from the result the impact cash reduction will of term by the The same expense interest net savings XXXX on X.XX% $X.XX expense rate annualized million. XXXX interest $XX.X our of the million. day, rate a interest cash to company $XX.X loan on interest fixing

we consideration third and price price XXX of the building a XX for purchased million. We on purchase sites closing sites continued of of end communication majority sites $XX.X by the these aggregate quarter. $XX.X of Subsequent to expand an XX also aggregate quarter, anticipate additional the our million, an the acquiring quarter and XXXX. first end, we sites have one of to quarter of $XX the XX sites data for communication we for agreed of have total total million to center During portfolio, in cash and

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

press leases, of we afternoon, update options million XXXX, providing more included all aggregate key we years, ground owned to full-year renewal In XX including terms. under or the position our approximately will and under a controlled, release full-year the of our buy services quarter third share expense. update now in quarter, land our our SG&A by this have $X.XX. land approximately addition is During an to ground balance end these sheet. outlook lower underneath XX capital results for life our will provide remaining discuss buybacks spent for in $X.X quarter, which to over easements metrics. leasing who average the At the the an and in to outlook Strong control, of than lease and and the extend in XX% towers, our liquidity increases in things Mark, earnings years. AFFO were forecast, will allowed These net XXXX per an to and with outlook to lower recent of for expenditures on drivers us Mark projections, results increase interest our I non-discretionary increases our share along of revenue lower moment, turn cash adjusted and the impact and we our

Mark DeRussy

billion ended with and total of net $XX.X of the quarter We billion debt $XX.X Brendan. Thanks, debt.

EBITDA target debt X.Xx range. to annualized at was net Our leverage end of adjusted ratio our the low

Tower adjusted as net Revenue the Securities, anticipated of corporate which January Net a third purposes. to have Tower January July Securities, coverage Tower XXXX-XC average X.Xx. blended expense amount ratio Tower repayment XX, were the was interest interest million X.X well $XXX an date cash of XXXX-XC general issued X.XXX% repayment through which X.XXX% billion of entire and cash Our net of $X.X Secured as Secured and aggregate EBITDA quarter Revenue $X.XX have The aggregate XXXX. of $XXX an Securities, repay from this for through trust, have with billion used a of a weighted interest of On proceeds X.XXX% life Securities being rate repayment offering dates million to proceeds remaining anticipated net anticipated date we of XXXX, XX, years. XX, used principal the of the

our a maturity April financing, result not XXXX. is next As until of this debt

interest today, As of no the approximately is and rate with have revolver the our balance of average outstanding X.X% under weighted of outstanding debt X.X years. average our we maturity weighted

which During XXX,XXX for Subsequent or per $XXX.X price price for we repurchased Directors average of million of share approved previous XX, of shares average XXXX, an million plan, as million Board end, plan, XXXX remaining. have stock the repurchased company’s outstanding, are $X an replacing our Today, at of third authorization a quarter, new $XXX The billion of September common XXX.X billion a or XX, shares our $XXX.X shares repurchase $XXX.XX XXX,XXX $XXX.XX. immediately, September the of X.X%. quarter million effective stock to of repurchase a had XXX.X million $X reduction share. per to compared we

of declared paid quarter equivalent with And call as Jeff. of that XX, and of Directors that, during XXXX cash share. dividend $X.XXX dividend turn to million XX, per quarter, a now business, on we will announced In And or the of fourth declared an today, shareholders of our per record, over share close $X.XXX $XX November XXXX. on payable Board of I to we the addition, the December third

Jeff Stoops

repurchasing fuel from Thanks, everyone. cash merger. exactly AFFO future financial in we developed company. T-Mobile the increased but Because Mark were a revenue, capital AFFO increasing capital and growth consensus those markets produced U.S. ahead dividends recover continued share. see all challenged due customer further of had over International we the quarter. and flow, has leasing our AFFO per expectations. would by leasing to almost at strong share in in as tower increased will to activity adjusted which to our stock share we growth time markets post our The international improving, believe invest remained and very We remained both still activity to year challenges, due it we evening and impact performance both EBITDA, investments, where per in continue on last activity the good of has to that call. levels, the predicted in XXXX help business and today’s per COVID-XX stable earnings another portfolio U.S. We and future expectations friendly COVID-XX our markets, third

COVID-XX We produce effectively employees our yet, still positive to results. with particularly against but continuing markets. our are the and pleased results, employees our efficiently backdrop conditions working The of all in of these work to of remotely, customers’ our are continue majority very and

while are bookings all XXXX. their the done working and a third and saw but in up, levels, are during next still in the leasing level throughout higher continued drivers new to saw year our bookings anticipated have who customers, had saw thank new sites backlog, We number done new I than of increased back do. of activity are fire-impacted to increase into working T-Mobile have meet the activity well our to earlier not trending directly basis several signs standpoint, positive quarter folks several and to application also have our quarters. a and efforts trend. for the as this for sites organic to will they growing of relates field fourth frontline only year. of have period. world, all a out for there for we of activity there been quarter-to-quarter behind in believe opportunities They We growing also COVID two increases needs. leasing quarters third and a increase merger. these There and the This results up them below to as are an we job the activity post of the ultimately our running From for great strong customers. U.S., These on we that a first continue for of to the get of hurricane adjust tower essential personnel the quarter in have appreciate in to pace domestic quarter This greatly the levels the see everyday and levels We customers’ activity, services

continue both. accelerate or stated expect to sites spectrum we their upgrading or of megahertz the their goals, coverage either to with XXX toward X.X First, XG majority T-Mobile meeting including their focus gigahertz

significant in Second, will will they participation, and network of driver see will require starting expect the both multi-year macro constructive upcoming XG with AT&T this existing over as Verizon and be we and a activity third, actively C-band of we we new spectrum option continue year increased with sometime next should deployment engaged out anticipate at a their a nationwide building be sites. of that Dish our equipment period. many And discussions the

African an the growth domestic signing increasing up saw COVID-XX several as year, higher create slightly in under these through levels move a of for to than markets new half of leasing we for under South year, the and activity the first should factors activity from saw which in levels, revenue Latin will increase of well XX% we slight environment we Notwithstanding international our amendments. we and XX% in next see crisis. leases leasing American following years. continue impacts organic bode domestic Internationally, All the

results of third our to to side, have quarter markets positive customers quarter improved the lift. in have as reported started compared the financial second their international wireless lockdowns most On sequentially

material prioritized cash. However, of have network they reductions have they have XX% also to XX% in year-over-year as made order and reported the deployment lockdowns CapEx difficult

As pressured quarter remain a result, in we international the may early expect next and bookings into year. fourth

XG as bright America to third embarked of significant calls Movil that still future with international starting such and markets. the the a On here their is their network investment spending, the upgrade us. parts quarter exception Canada, as the access yet some throughout side, for certain critical have positive in None, in Internet our more to our in discussed possible see of be the the are increased all for plans customers, on of these will of which we markets type of believe to needed be we for all of normalized Wireless continues U.S. capital have

services conditions construction activity, had wireless with seeing material COVID-XX in activity, U.S. the expect with As T-Mobile. uptick considerably. in our a leasing business our our capital quarter particularly improve we strong markets international pick-up Consistent will a improve, in spending

SG&A We our continue costs well. also cash, to control very

including As adjusted and the we cash again EBITDA flow Domestic tower the highest an margins a industry, in result, cash XX.X% flow tower reported margin.

cash CapEx. expenditures interest were non-discretionary hand our years. to also cash obligations for again our to able able an out-of-the-money the to control and And reduce We reducing hedge, full future the use pay reset we available us allowing on off for year quarter, nearly outlook rate interest significantly were to this our capital for next X expense

due will to of share down us AFFO AFFO but have years to it. we target predictability largely strength our we of experienced just $XX response set significant else, allowed and this were up hesitant not And ‘XX performance only Bank this If strengthening think and in solid actually Reserve an is boldly, per this bring believe short $XX. I of of the business nothing am per our while which U.S. ever. Federal negative up XXXX and for the movements to made relative lines share annualized ability really to end Our we highest produce the P&L quarter If of year, FX to fourth quarterly X out we I that our and COVID, dollar the by of ago. the indicative policy would manage the almost

allocated and operating quarter results, a quality high we assets. tower our to addition financial or In also had put We purchased a very capital. contract, under of solid number

a long-term quarter our And growth We data of AFFO last our repurchases. future step as built for us JaxNAP expected call, in maintaining share. towers international earnings markets. portfolio third will share will focused $XXX per quarter. center dividend than have stock, and projected AFFO We on and which per on which data increased and demands our our monetize, for our generation spent center, eventual our capital going including We in in forward, and the ample our of fourth announced contribute a across positively anticipate XX% less we quarter AFFO dividends, invested on continued edge plenty we center quarters increases stock being growth ability midpoint while ready that discussed give strategy of opportunistically represents fourth We to sites. big data to amount our today, material an of our million capitalized this the third and tower in repurchasing at number

materially to a declaring balance becoming effectively quarterly I’m basis quarter X.Xx, perspective, XXXX the through at is preparation our sheet a third the we’ve course been of Directors that conjunction outlook, of Next quarter, the practice, remain in Board a dividend, a continue of quarterly From comfortable very year. to ending with. the we as anticipate leverage able the be will on manage which level our increased same will our our with

mentioned were markets refinance which reducing we this quarter, these the capital In times X.X%. securitization we’ve And of averages debt to year. have third able opportunities our very As earlier, billion taken cost of overall advantage $X.X been several notes, the debt, I of accommodative. today

to to grade of which have course including when us opportunistic provide repurchases, strong properly currently of our able an our our have $X.XX another We next we the strength and liquidity, very year in our that, have sheet confidence ready to continues balance on times. balance dividend. flexibility comfortably shareholders. no quarter. the third of benefits challenging to We the greatly look questions. again available investment our want we success, their high investment grow results had forward sheet, during end you a now and achieved for to billion members debt these our and and opportunities to while XXXX, particularly team quarter fully a undrawn revolver. still around The Rich, and be sharing debt quarter. maturities contributions support solid with our to cost share and levered We I to being materially for our are And managed We with customers with thank until continue

Operator

the Certainly. of JPMorgan. [Operator Please We Cusick line go will with with ahead. Phil Instructions] begin

Phil Cusick

a Thanks guys. lot. Hey,

sort that next year from discussed other ramping probably and So, Jeff, you quarter. T-Mobile further could the Do in slowing carriers that down out? that ramps of see net some you fourth be of signs would the growth

Jeff Stoops

materially. think don’t I

will happen, but two going are can the we the before signs highest bit that way and going I in with of that’s see T-Mobile of time. I in we direction. going one But to mean, other know, opposite a don’t I today anything will to the of course, see particularly activity don’t a levels we take respect little XXXX, see because period think the C-band, expect, though, I time, of

Phil Cusick

That’s you something the Does wait momentum as great. this in of that And for deployment then a seeing well and of for couple that of we’ve be today? what been see happen MIMO years. do about deployed to is talking or kind you’re C-band

Jeff Stoops

And, deployed seeing is the most efficient preferred the it today spectrum and because most way that we’re out seeing being is get preferred we’re today. the mid-band I happen the the gigahertz way to Well, understanding, my of spectrum XG. that X.X for way, mean,

Phil Cusick

how I Brazil? in And That does what to sense. you activity levels bought compare sites you when can. see more more one if And that December? Thank you. What makes in do you expected in

Jeff Stoops

didn’t and you, over in and the improvement going in the conditions, FX in have be the didn’t adjusted, would COVID, very see and part, in I for see we’re which gone telling did everything time if what see we But see coming to But Well, think currency improvement we level on Brazil in the those we – year certainly constant currency we we demand, steady is think assets, December. seen numbers due of of is, COVID good Phil, – with I not large adjustment, those a Brazil. this to. has we that foresaw out Phil, tremendous some back

Phil Cusick

anybody could like that, despite say still COVID. think but market in don’t I good it that demand does sound there’s

Jeff Stoops

materially and money their very a are. spend in the said of and I things rates in strip customers environment if COVID. look, you going our thing. and And on in is. the growth currency where more back And pulled have this on basis, to mean, numbers CapEx coming about you this look where an at pleased temporary, response – mean, I to demand we’re there Yes, if still talked they year constant out that’s basically to we’re with a back Brendan to that, need that see were and in is these you

to – very very continue our operations. we Brazilian with we’re happy So be

Phil Cusick

Okay.

Operator

the of we Simon Stanley. go Please with And to will ahead. Morgan now line go Flannery

Simon Flannery

Great, thank you very much. Good evening.

very and about You were Dish CBRS. the much about active – didn’t T-Mobile, talk talked you Cable about in they

How contributor a some real old think in So those do have reducing Cable some be ‘XX I T-Mobile, conversations can think, they to and take structure of are interest beyond? wondered, a Is those [indiscernible] going? allow? Jeff, opportunity, down on And come in you to the sites them them current the an quicker contracts some work there to sites. allow you with up Sprint to than with of

Jeff Stoops

of any dates discussions. have deployment open really straight Simon. don’t Sprint and have are time over that [indiscernible], to the of network are that We just a always more leases termination Sprint we’re we have regular What various

of and ever Cable, terms some a we have. have greenfield incremental to ability out the do In do desire know space. other for lot But benefit – have demand demand holds. our tower Cable, will nationwide some the a don’t from their mount build spectrum mount four spectrum way a I or will of the see of certainly Cable to we that

Simon Flannery

buybacks? don’t just to – at should with the on on Great. opportunities? depending low the you price Brendan quick we How that to at desire Xx one stock going that stay the is, Xx. leverage of And were end leverage, lower that if then keep think Is of where down one your you’re for the have about other versus there coming you M&A

Brendan Cavanagh

mean, to I that within target stay desire range. our Yes, it’s

low available it’s – it and now. around terms at a in opportunistic really at asset We’re end us the of share to time. given the of being matter of what’s acquisitions, buybacks a the It’s

we’ve quarter share fourth through in quarter. largely today, there some we’re buybacks and in the third the done So already

same So forward. around you we’ll range the expect somewhere going should be

Simon Flannery

thank Great, you.

Operator

We’ll you. line to UBS. go now Please Thank ahead. go Levi of with Batya the

Batya Levi

would T-Mo of we the thank pacing think up? churn? T-Mobile churn Great, in you. I year, is is think less ramp think color X%. about anything to to if the some us and for early little there Maybe Can shared how a next that look coming on when should remind this forward than we you should you

Brendan Cavanagh

years end a at the small, XXX for million in so. leases Yes, its average around That dates, the $X we for sorry, though, when the to are churn on look at in churn on in years. next out particular, thus probably you you bit notifications seen but to it X the impact of it When have – we for X million so T-Mobile, have that relatively look our Sprint in of overall terms is we of is leases almost or and of from about range little most $X T-Mobile – terms is, date, – X left year. overlap far, specific

that toward stuff to expect back heavily seeing we start going weighted the that we’re So end.

Batya Levi

it. Thank Got you.

Operator

And now to go the we Synesael Cowen. will with Please ahead. go Colby of line

Colby Synesael

Hi, anticipating just But might further the in a investors the on you level for And next this XXXX a the follow-up I net offset much that yet, demand would think then about that increase too just about I there that of was few of same-store you’re capital in about you’re wondering talk you the is appreciate now. but on XXXX, in activity increase where great. give seeing? mentioned growth step Maybe a there is below rate to increase just that, growth including lot want risk big such appreciate that that allocation. in to leasing up that’s actually ‘XX right point new quarters, versus be don’t And the guess you I new same-store a in the focus XXXX then obviously that secondly, could you fourth rate the into up XXXX. when a quarter ‘XX effectively to churn and a despite

just do to you buyback down you. we that You Should now, just talked period time. long economic anticipate growth to It portfolio situation less the there internationally, continue there. given to the that of XX% perhaps right is over Thank interim? in sounds about step the up a like X%

Jeff Stoops

the You take one the I will second one. take first

Brendan Cavanagh

it usually stuff give that’s first same Okay. Colby, by on Yes, based on the the growth churn that we rates, year. mostly tower it’s the this into happening and next when most so those of way question, works year driven – part

is lot So of a that unknown.

although don’t for be notes. expect churn materially some the higher, potential I there additional is some to So

this plans around yet. ‘XX But is better happening it this [indiscernible] levels will there of to the same of year’s rates leasing growth have until activity what’s when some tower And today terms overall whether impact I actual think is a that as growth slowdown numbers influenced T-Mobile the quarter year, and ready we saw little in from But will have part a we’ll the certain activity not We’re numbers. some view we next of so to trailing year by give because well, new year, the them, get churn. on be first also give indicator. numbers in the on bit next the

Jeff Stoops

Yes and which start deployments. we really just how and deploy in yet seeing come we digging will year, and know frankly, don’t the that the soon Dish to starting benefits C-band from today next

– So, to going XX% Colby, on it the to hit this not the goal, we to X% are that continues be the year.

that see to next from only X%, year, quality. I the opportunities we I there out were perspective. to where in just this is to opportunities not year comes will will to and buy to than right it’s not not you the sense made we’re just we continue are a have believe be stuff to enough that’s that’s year it’s be If is X% add those and buy There year. us, the we number for of to don’t greater not averaged enough going numbers. we together it didn’t the But XX% way, and there. price there going this number, that this but the thought Unless last all think going stuff be out year. it’s indicative this how But pricing there hit opportunities target We things.

Colby Synesael

you. Okay, thank

Operator

the ahead. of go line now Citi. Michael with will Please Rollins We go to

Michael Rollins

Thanks.

So, afternoon. good

over going then booking delay the Just taking One that how playing a purchased And you that past of you this impact time? between what is center questions. learnings duration bill center to edge step compares the share how follow-up from couple and effect lag could there you has to SBA and the curious kind to model see us billings quarter, you ‘XX. the a begin book data data you with is Can and are maybe if the this out and just so, of current mentioned a your historical with, with that range? so opportunity what for back, getting share and into

Brendan Cavanagh

to can book bit say the the than On it stretch on carriers, depending I it a has we’re the out done bill, months. to mix past. It X and but the it’s amendments vary in XX by a little typically bit would activity seeing longer of little the that’s been type

past, think the I in they but delayed happened major range. bit are that T-Mobile typical than the to little going on projects particular there’s many in a months maintenance with is so longer XX the X

Jeff Stoops

we’ve to with is about. want to be day, it all sense, what That’s We getting attractive site. At may this a site. hub-and-spoke number to between. end data thought a is well definitely the and meet-me got it Yes. in center, that something is that’s cable at we right unconnected tower the maybe whether or business, operators of are What cell But center give of where model, data lot less, center two, tower that separately installations purpose one right kind in different some position has at this on of different Jacksonville to an to we’ve us all with an is sales how connected that a folks to and rooms a so that or into to in so our and Mike, theory. experimentation to It’s there, that, for understand the on larger who of learned to smaller when of many there we that Chicago, one understand two has data undersea center can sites for land of a lot experience it the data with regional business, something applications connections, that having and of offering in have not know opportunity maximize centers, center will be data be centers the also going we’re our And Jacksonville, make these fiber, by landlords us data data and the customers, the experience on far skill set. some but is also now business. the the needs the call interconnect, different is type

on our next some it sunk results and be it got that more years. we’ve the unlocking investment kind any be time value So, it’s cost and material as to to already financial in. land key the comes, several could going that sunk a frankly, for But not of really to

something about that excited it’s the long over term. So we’re

Michael Rollins

just hub of with need hubs there that, NBA-type these is need? think do in you cities to respect of any to sense a And does Like how that you biggest many hubs that NFL, the or may and your Like, actually used you how to do think cases, much least need initial at have the hubs the eyeballs to learnings? in and that spokes? many the be be from about you so might closer

Jeff Stoops

X so for it’s regional the Tier hubs. the – delta more Tier X, Yes, markets of a far

areas the do it expected That’s than now got could spokes than out have of be whether sites So out to there’s connect different then have it why to or sit the for side than things two both the and more and all a months. kinds more models, to we prove to side doesn’t opportunity have rather got to me number business but more spokes that other. the that of be you and the owned we tower you two to more of of sense, to are there – you’ve have that for hub another and developed be to needs these less, are be fair things, makes tower tell but enough be this creation where to of if sites going partnered, able

Michael Rollins

Thanks.

Operator

ahead. We Sachs. go of the will to Please Goldman Brett Feldman now line go with

Brett Feldman

Yes, to company. benefit during C-band time for a the you fully your acknowledged and take it thanks little bit that could taking mentioned prepared of that question. you the remarks, for the Jeff,

a questions been it is we that couple them actually I’m two because there there’s of tranches seems the not clearing weigh and towers what of getting timeline about do is One how think we’ve to of one that and is relative because against the timeline you, which how considerations or to clear. are be trajectory which your sure factors where there’s determine like is to just, going the

just buying is your of [indiscernible] they lot a other of The and which C-bands. are

to your as are process just So start around for you really reconnected? could expand from you to your benefit be Thanks. actually think hoping was best positioned you to thought I when going assets us, can, that

Jeff Stoops

Well, I mean, me. you for kind of answered it

and by until is, giving got where. we the what taken it then. have of and outlook You are the give one the done when auctions some who by really But benefits won’t of to know hope XXXX we that of information

be folks the deploy do and looking the of based spend a do that and the have our on that to are to feelings they look factor can They will outlook. they part we who the large dollar be in as spent results able quickly I whatever – as that into will folks early the dollars will and we indicated large from can. believe at least So looking that that. bring and at be belief to the

of without things. it kind say is is be not for where. first to But to knowing how thing specificity the that going going So hard what won we me it – who to now, is triangulate are about and with

Brett Feldman

spectrum markets Do enough you of you it over until next in that the XX line be you is could XX don’t kind majority wait towers in yet? meaningful clear that actually willing be would for you or the such that have are months know or catalysts of the it to or charge

Jeff Stoops

Yes, TV faster go just I clearing is spectrum it spectrum. the like think to folks going than think, did on the

I incentive it, the of it’s to and for it go quickly. going that purchasing is There for of And that guess, not. us they in it’s arguably done every get some things with bode stay to going for think to some cases, because spectrum who our I a well are may purchasing, very T-Mobile Some folks win competitive industry. deploying rapidly to faster,

Brett Feldman

you. Thank

Operator

line go with Please now go ahead. Nick Del to will We Deo MoffettNathanson. the of

Nick Del Deo

my taking thanks questions. for Hi,

attributes How Just you following C-band do host economically can well about or towers traditional be C-bands, up which given positioned on in that to band. deploy just Brett’s it? think share to right C-band of might carriers question, way would towers areas, mu rural not especially in versus the there dimension smaller of you the are not think presumably the the that’s propagation share

Jeff Stoops

amount RDOF have large to through – amounts the these coverage are you these areas underserved large about will – don’t – These the part areas. bring same have areas most old which in money I the don’t the absolute I mean, the where is the be some, think really towers, I think actually they Yes, and but I where I today. except don’t have to that suspect of anything incentivizing the you talking think are government you there –

I the they a we most think where part, XG the of believe most carriers going for brought XG and in are the of form where spectrum. are see have existing coverage, today, you XG mid-band to

Nick Del Deo

to or very Okay. post any one has you see savings? on going COVID which revert equal anything cost COVID-related And COVID-related extra of kind then strong, been obviously margins that’s to do about

Brendan Cavanagh

don’t going that not come have I I our been don’t overall at really any back, mean, see look a see still Nick. I anything you we type to down. to think for But margins amount just that’s No, business, – mean have you small material. such I had and entertainment in travel are that expenses when of the it, the

Nick Del Deo

Okay.

stopping are can housekeeping you I or hear. squeeze PCS-Leap-Clearwire you impact quarter disclosing it? one Okay, just If in item, are this churn the good to that’s

Jeff Stoops

and We of consolidated it’s that than churn immaterial. that on less that’s it basically because basis. stopped X.X% same the become a I than tower that on number, believe lower largely domestic side

Nick Del Deo

you, guys. Thank terrific. Okay,

Jeff Stoops

Okay.

Operator

go Bank America. Barden we’ll line Next, Please David to of with go ahead. the of

David Barden

one you in last over leverage questions. question closer guess I of about guys. first that anticipating is of bring was Jeff. if any tempo below dividend XXXX? inclination my of will the obviously great year. were an come T-Mobile Brendan, X. and even Thanks. longer I the that be grew Is you a that spend wonders the the when affect dividend guys targets, no for fixed maybe Hey, Tower the taking now cost second of Is remember Thanks the MLA guess kind there I can plan? cadence the part we for kind the game down to that historical talking the American instituted deleveraging there to would as you’re for And that

Jeff Stoops

don’t given to MLA, the committed accomplish the is approval, SBA. think to of has impact think really so, T-Mobile don’t anything that Yes, terms on there’s under I the going what David. I

Brendan Cavanagh

David on the...

David Barden

to Good hear.

Brendan Cavanagh

just that dividend any half mean, of leverage low represents, generate. every the don’t year turn On I our a reductions in I we now, calls a returning right for think leverage. we cash delevering material percentage mean, organically growth just to naturally for it and how given the and EBITDA are we plans, a that

to keeps it be requires us – that the invest significantly in So to up, it continuing business.

any come the be our grows, buybacks. assets materially. start to But I continue think to lower would to larger opportunity over dividend it keep naturally percentage to it much then new and up intention of flow, But we to invest So time it down. don’t the cash right in see a whether goal as becomes now leverage would if or free share see our we have

Jeff Stoops

Yes.

David Barden

Okay.

Jeff Stoops

when conversation we that started more at we than mind, Xx. in keep And were at regularly running X.Xx

David Barden

Great.

guys. Appreciate it Okay, great.

Operator

Ric Raymond you. go of ahead. with Please line Prentiss the next [Operator James. Instructions] will we Thank to go

Ric Prentiss

folks like It Hey, and doing you sounds your are guys. Yes. well.

Jeff Stoops

How All about Thanks. you? good, Ric.

Ric Prentiss

of update status could. hunkered you the Yes, if Couple the well questions, in areas? doing I your us project Can on down. of FirstNet

Jeff Stoops

Yes.

of to be and have we with We about and probably active we FirstNet. still – I continue to XX% mean, then sites our XX% are AT&T, to upgraded

ways a still go. So to

Ric Prentiss

expect And get XXX%? do to a you to

Jeff Stoops

than but quite, where up Coming much we are today. higher

Ric Prentiss

are discussions And could clearing than with Okay. you the run so potential suggest? process Yes, winners having might C-band they faster any

Jeff Stoops

We that us our know have customers access basically on they their relatively can gear they for quickly. and had general give conversations, sites, our which

to do are parameters them to the allow and place in that. – So

shortest not the the So the tent, Ric. we longest are pole one in the pole tent of and in

that. to So, ready here I that. lot there’s mean, they I mean, go we’re and just not know need a for of all and

Ric Prentiss

Excellent.

you not your all, this might for questions Does about are new getting LEOs that mean, new deeper? have and at one one last we affect and customers gotten you So RDOF I the fiber either LEOs or auctions. before.

Jeff Stoops

Well, we out service to auction a leasing went that of bring fair the areas. the last rural amount from – to had and try occurred that the

mean believe, will what RDOF impact, by incremental have mean we be but going the you mean, for similar positive that when it’s leasing. do hopeful are I we to So impact? – you generally,

Ric Prentiss

deeper you the the into maybe question LEOs, by network? wireless from going being fiber Yes. on the get impacted Do operators

Jeff Stoops

It it’s not doing think it around I the will Well, edges. they but material themselves. be are

Ric Prentiss

Thanks, a get just technology we that No, Exactly. Stay question. guys. roughly well.

Operator

you. Thank

Green now will of Guarino We David ahead. line Street. to with go the Please go

David Guarino

provided here, for guidance non-FDIC-specific. question, ‘XX I a somewhat is one year disappointing. be be guys. is And T-Mobile talk then I Thanks returning. of I that thought industry to if activity wondering for range your that’s the versus going leasing can flat would you which peers next about, general, the essentially expectations reason was in new asked for

So if wanted that to a reflective was for I broader of or take get next your a year. just company-specific issue industry maybe trend

Jeff Stoops

be financial guidance T-Mobile year, out year believe, going. gave what going actually the will to will to we’re do. work say and busy, is for how going in next which starts are going to to levels, about be we basically financial real they the the opposed But, but as we ultimately activity Well, drive as and not issue the the C-band about XXXX. results, all that’s Dish to the results, get And early to really

David Guarino

lot sector into year. you fair wanted of It willing like evolved eyeballs Have the And exceeds at that the seen the types. maybe market, on gears, are since get of relative tower towers transaction feels that enough. even are higher that for and assets? how then there switching to just more other maybe looking pay you is for prices your start to thoughts I on translated paid, property a Okay, what guys to that’s being certainly the something

Jeff Stoops

interest up has, have pricing levels and of on years. by towers, X% many the higher such which number levels, clearly we a degree lot time particularly in There a we players, first a in it portfolio to why a would communications be transactions. infrastructure, our will Well, new is pass has be that taken expanding pushed that of which of is

David Guarino

are Would terms much higher of you how something what just on that specific and are you comfortable quantify could multiples be in with? possibly deals guys

Jeff Stoops

No.

David Guarino

but... Nothing specific

Jeff Stoops

compete am I others’ compete our us. for ability ability not and No. and to productive against notes for sure take that’s to

David Guarino

enough. for answers. Fair Thanks the

Operator

Please Piecyk ahead. with We will now of the LightShed. to go Walter line go

Walter Piecyk

this on. am I Thanks. through on line, feedback and have just try to it. getting go I hold

indicated in basically getting to too a I me much I because was there you – am this, that So my you re-queue got on feedback do lines. can’t

Jeff Stoops

you, Mark to will recap Walt.

Walter Piecyk

thanks. Alright,

Operator

Alright.

We ahead. line the with Brandon go Capital will to Nispel go of KeyBanc Markets. Please

Brandon Nispel

year, are about then, Brendan, X% had we you run-rate? T-Mobile in the next a sort pretty long-term a a at One churn close question. one-time rate AFFO are for you outlining could, for brought so not Okay, to quarter if per to any remarks I of great. share interesting mentioned guidance to look of up going for taking annually? for out for the Jeff, And you when be run some you then Brendan, breaking perspective Thanks and you the those one near as us level like? investors go churn might churn, start the Thanks. into maybe what targets from you cancellations, think point fourth in that like help where your your term future? And specifically understand $XX, is there And longer would if are you can so, Jeff,

Jeff Stoops

anticipated. be where FX feel we by out exception out about things much proved on put the ‘XX that XXXX with to $XX good we more that than Brandon, pretty came in the that old the guide

everything I longer-term that respects, some to that close idea. not particularly on there that AFFO of quite beat we So many about we the can FX parts get right share, control. but such Obviously, a not down to that Brendan? for might are guidance, maybe great make think it’s we something per was will in sub-components a multiple and it extremely probably But of doing we year based experience. actually won’t maybe else handily. on Yes, basis think that be that

Brendan Cavanagh

Yes, Brandon.

million $X.X is about I on churn, churn million, $X And which have received basically So of relates on, the million, churn, that be much for is impact mentioned, the pretty it T-Mobile what Sprint the we would notifications as $X impact. that mentioned maybe to I as earlier, next year.

what still mentioned we amount relatively revenue next to a that the the amount If looking at full have are year might notifications. about be were which highly and at for small total, of only risk any Beyond of is received that next look unlikely and we incorporate not we that, year, in Sprint for time, of churn from amount. X% that’s just includes at to happen, at

So – you, we get we more when quarter. give next giving detail expect obviously, to don’t guidance will we

that’s point, lot the information impact more that. have a that but will of We at

rate of we – X.X% from is a to X.X%. relates churn at so leasing I mentioned the quarter, same standpoint, of reported that run this whole, tower were from it to or Clearwire. a churn level, as domestic of As natural vestiges we about earlier that a

of course variety under about will is probably X%, there. a in just that’s of the range things So year. the we that next see There the over

have on about that and the number couple next older smaller seen customers of to on somewhere happens lot X.X% We and of its with this impact we a have calls, what technology already then basis see based in some talked have modified in customers a that year, that we cleaned normal air year a on of what keep some miscellaneous past, including Sprint. some some to stuff their items us range of our have will X% on should up,

Brandon Nispel

Great. Thank you.

Mark DeRussy

for Rich, one time call. we more have

Operator

you. Thank

Spencer line Street the Please New Research. to go go with ahead. will We of Kurn

Spencer Kurn

amendment the pricing. bigger. of rate, frequency antennas, just have which me I minor lower heard, but thought wanted a in revisit Hi, the for Historically, lot I are would squeezing same typically guys. spectrum only time, smaller to command amendment higher Thanks I at having antennas, would here.

thoughts just see price would you minor Thank of daily deployed? on sort antennas is I amendment want So more to as you. get being how your trending

Jeff Stoops

trending trending it’s and but weight I changes size. than on it based higher, not in has Yes, mean differently historically

in been ourselves progressed way with over is it has which conducted it’s has have logical because it’s way time. it consistent we terms with of So at the customers least good and basically the expected our

Spencer Kurn

been on you on like have just towers. pricing But being whether transition curious as seen an a centers, of big seen your just a stations have impact big Got seen and C-RAN follow-up, into as it I doesn’t base was it. data actually C-RAN played on seem that’s and entirely out? how by impact And of quick of pulled the have we up has offset as new sort antennas we thoughts deployed of filling being towers

Jeff Stoops

we matter at the as there – we we much radio-only day, we provided got doesn’t the and height and location all a to that think whether end the have the Yes, impact the where of else, will, really as really location and not the the host don’t antenna the ability and and entitlements antennas. the business, of computer radio the at seen or somewhere I bottom the because are we at tower much it is really is

Spencer Kurn

Thanks again. Great.

Mark DeRussy

when and joining forward report So call for we our this Thank quarter want us next to thank look you. on fourth call results. everybody we to we our

Operator

after Thank through November Eastern you. for Ladies midnight. and XX X:XX gentlemen, available today will at this conference be PM replay

entering the by time International any system XXXXXXX. participation You at using dialing or for today. XXXX-XXX-XXXX XXX-XXX-XXXX may code our an are with and XXXX-XXX-XXXX, Those your does XXX-XXX-XXXX. AT&T of code That conference for access you dial teleconference. replay participants access numbers the AT&T Thank for access XXXXXXX. may again conclude

disconnect. now may You

SBA Communications (SBAC) 3 Nov 202020 Q3 Earnings call transcript