Earnings call transcript Q2 2023

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the SBA Second Quarter Earnings Results Conference Call. At this time all participants are in a listen-only mode and later we will conduct a question-and-answer session. [Operator Instructions]

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

Mark DeRussy

thank quarter and joining for us Good earnings you conference second 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 detail 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 are XX. statements July Our of today,

We make. obligation to we have update no any statement forward-looking may

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

With turn that, Brendan our second over results. to discuss to I now quarter it will

Brendan Cavanagh

ahead with have on site EBITDA, in AFFO results for tower Thank full that per another revenue, steady updated we our of you, quarter the XXXX share. outlook slightly year adjusted our our leasing evening. cash had expectations balance Mark. AFFO the solid financial We flow, results and of year, QX increased and expectations. Good were for these Based

second site leasing were revenues or Total revenues GAAP and for quarter site million leasing the cash $XXX.X $XXX.X million.

the with XXXX of currency basis a the net when quarter Foreign FX which growth X.X% the quarter for constant second of and of calculated cash impact second exchange benefit rates and to is quarter churn. our $X.X on over revenue recurring a of X.X% headwind previously leasing forecasted compared million including a for XXXX. tower $X.X quarter million of approximately estimates Same was the when second of the represented rate compared

cash on growth year growth gross recurring quarter same-tower second X.X% cash including quarter. leasing Domestic recurring the revenue a X.X%. On over representing a last was the net placed leasing leasing or same-tower X.X% X.X% bookings revenue was The revenue and of declined basis, basis, new second activity a gross the operational first churn. basis on quarter during from Domestic contract under of

While of the the quarter were with prior we sites active customers number agreement below the our several expectations. leasing remained significant major on from mobile to network upgraded be operators. major mid-band XG-related their continue by execution levels of our second Longer runway our in spectrum see all carriers activity for new deployments to remain that based with term, networks,

agreement come. master have us entered providing agreement future In addition, with lease today, tower our long-term AT&T. growth leasing of committed with new into solutions This AT&T's announced that deployment while we a portfolio we XG comprehensive on organic revenue will across XXXX streamline from $X leases amendments this domestic AT&T by contribution we last for and Based years from have MLA, quarter. provided projected full leasing to our from million the increased to projections we new year

in high current a year for stated this for previously at to projected opposite on had XXXX million, Sprint analysis, million. resulting the incremental X domestic will Verizon total domestic during quarter, due year churn that quarter. full during activity experience primarily to we we be last $XX elevated and $X end decommissioning million T-Mobile, represented second bookings up Based churn legacy our our to our leasing leases XX% domestic signed slightly our revenue churn than of Sprint change quarter, represented of of faster our the During the AT&T, XX% approximately DISH which leases year. is outlook expect XX%. of the big The and represented amendment was the carriers new was $XX of of related of range of Domestically,

have churn Our impact of cumulative not multiyear around the merger-related Sprint ultimate views changed.

as timing to more be we XXXX to Although $XX around million, range $XX $XX continue $XX related million available. between a to XXXX information our We million. to million $XX be to and $XX in of XXXX now be Sprint and million million million be project becomes million. to update XXXX $XX to churn to outlook $XX

being our Just our but line be and as projections. last initial Non-Sprint-related somewhat to was little that year line likely our ended well expectations, churn expectations a timing will will we continue anticipate domestic provided our with prior up be XXXX projections. in in below churn with above exact initial fluid the

international a on leasing quarter X.X% X.X% growth in constant On of International was internal a leasing activity second to revenue currency basis. was results. basis, strong ahead same-tower our gross of including now or the Moving net, churn cash results X.X% expectations. contribution escalators us our to our international XXXX by new our to also solid to $X These Inflation-based projected have organic leases growth. from revenue allowed and increase positive make million. leasing amendments and steady organic to backlogs contributions continued and

our outlook year for full the However, Brazilian $X contributions us escalation caused decreases and have in by actual international moderate CPI projected million. to for rates approximately

our on currency which was same X.X% constant the largest of in was significantly previously amount market, impacted another discussed including had growth X.X% a very Brazil basis, Brazil, good The Overall, rate churn TIM agreement. organic quarter. by international of our tower impact

line and outlook. While provided with churn remains it to international our elevated, expectations continues in be previously

that related does TAM XXXX than a include the associated As the consolidation outlook our other any to not assumptions agreement. with churn OI reminder,

with we have current we would would our year, the that during that carriers consolidation were on the our to to if an adjust enter be expected oil at outlook into year any However, other related impact to accordingly further time. agreements

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

the for Tower by benefited second approximately in flow quarter million cost flow Tower million, $XXX.X accounting-driven cash cash in the reclassifications. $X.X was quarter

tower of or flow excluding XX.X%, domestic with Our cash of impact quarter expenses. the margins remain flow of international pass-through cash an flow second and margin tower XX.X% margin cash reimbursable XX.X% strong, tower very

EBITDA was $XXX.X million. the Adjusted quarter. second the in margin adjusted EBITDA was in quarter The XX.X%

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

During million with $XX.X quarter, in revenue business our second operating quarter the strong of $XX.X and another services segment million had profit.

part While site ago of we our XG-related remained full off the year activity our business year quarter carrier retained the outlook first due our busy new half and deploying our strength customers levels, during for equipment in results. to development have

operations second AFFO or AFFO basis. from increase XXXX was a million. $X.XX, quarter $XXX.X share was constant currency of funds per Adjusted on of an the in over the quarter second X.X%

new an to all During portfolio, Subsequent continued existing end, for for consideration the quarter, sites to in in and purchased we our total million cash million. second have we additions or $XX.X quarter building XXX markets communication under of our XX invest acquiring $X.X sites, agreement aggregate are purchase to sites. of price to X

We on closing anticipate the the these of sites by contract end year. under

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

on I things will who that, update to sheet. now turn provide will over Mark, With balance an our

Mark DeRussy

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

and annualized adjusted to debt target decades. range was And EBITDA end net Our low below in X.Xx. leverage lowest the level the of our ratio

ratio second net Our a to adjusted cash quarter interest of was net interest expense EBITDA X.Xx. strong coverage cash

maturity our credit And $XXX outstanding years. debt our to as million $X.X approximately weighted under of X.X our is repaid current outstanding X.X%. our a under weighted was revolving billion X.X%, average quarter total XX% outstanding revolver. During facility. The of outstanding have today, average rate rate current is of on a debt current we revolver fixed. with rate subsequent interest balance The of interest The our amounts end, we of

the authorization million. any The under $X our XX, June XXXX, to at billion did stock, instead shares balances. company plan. have repurchase We stock not common currently shares purchase remaining were $XXX.X During reduce revolver outstanding our $XXX repurchase of we quarter, of choosing million

In per share. year we as record period. over $X.XX year million the the business declared third our today, paid And quarter projected August This quarter, per dividend dividend of and of of on AFFO. dividend to approximately XX% an increase XX, ago of in the during XXXX, full of we and or of our represents announced addition, close $XX.X XX% the paid Board dividend $X.XX only September shareholders XXXX. that share a declared XX, we cash a payable on of Directors of

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

Jeff Stoops

everyone. evening, good and Mark Thanks,

second areas of We was and results service with one all their for produced our financial Each very operating high-quality customers across another of networks. customers. to for business quarter our and we deliver The continue our U.S. largest remained solid active SBA. results good

We same to deployment have well of did, coverage the bands continue colocations. discussed. see slowdown of the customers as through equipment new to others however, new add through Our support many activity in sites spectrum that in brand as XG expand to

of we While we from growth leasing moderate anticipated our organic we and than activity had as levels lower domestic XXXX QX leasing through customers. move always some anticipated to were in

slower a activity as the followed technology in part coverage of of Some these building. years from in seen generation large this as network MLA due, new that coverage of carrier next are completion be activity burst be of the to time, investment have capacity starts of over anticipation variations AT&T We would we believe, our expected. normal believe cycle by that was activity many to of we initial and of deployed,

We consuming be importantly, a demand believe Most continues the reasons. additional fast of more network and years. over current are investment capacity. several will at a number material more confident there this to We next network wireless clip, grow of that for

accommodate spectrum large yet. couple have meet not MLA not to even We which XXXX a have over coverage is holdings our some we mid-band of that the last our requirements upgraded customers number with and the have phase for newly been AT&T. deployment regulatory has by of in signed spectrum years, their DISH acquired yet to of available remaining next of sites

multiyear these believe We supportive development all items and activity. others of of are continued

in just levels of variety throughout long-standing leasing relationship. and we're seen be in our this as in always we remain will announced activity AT&T, very will this master continuous flows to network based we there chapter agreement regard there need factors, next for a on believe our with a about lease With history ebbs excited successful that have our business. While investment

to regard This SBA between working We agreement with and network deployment carrier our operating In deployment plans. services future highlights sites in come and with under AT&T look helping growth. future new agreement to AT&T's leasing efficiencies for to the forward closely improve beneficial customers this importance of to enhance organizations The long-term business objectives effective quarter, will an remained meet efficient mutually our years second our framework. stability manner. the busy

our XXXX business basis, represent this goals. business down our a will year be to our Services network year-over-year biggest legacy services company's second positioned provider customers rollout their go-to reputation history We a well service meet our only on for still believe in the While keeps XXXX. us to is and the in behind

another we activity had greater than anticipated. organic we solid also leasing quarter Internationally, with had

strong our came America, opportunities well market in We each of some Central carriers quarter, and financial exchange through the from about I including quarter providing we came for amendments performance, increased And full our pleased was the movements with to made Brazil in expectations seen have market. outside of new big Brazil, cost us the the has ahead business international outlook. South of contributing broadly new up dollars signed X U.S. in the remain and repatriation of continue our contributions with relationships Brazil. largest XX% in leases a with in During customer positive that existing currency Africa. of from for to markets, Brazil internal leases many our the and recently and contributions rate, our management U.S. excited year increased which in leader as operational benefit as be to market. our XX%

generated again cash significant we allocation. discretionary quarter, providing the for AFFO During solid

outstanding further growth stock financial paying the in of us majority for investment our and While the revolver. the dedicated future balance repurchases our cash flexibility in quarter to available strong our position portfolio allows and on we to down retain opportunistic

We reducing floating obligations debt immediately rate interest cash among the our benefit capital today our which from this highest represent structure. by in cost

currently our tower market cost we believe this of private use of With the continuing spending. best high limited acquisition availability and is opportunities, discretionary

quarter as believe lowest EBITDA I our a ending adjusted the history, net least to in to was public be company. Our at ratio which debt leverage X.X%

to continue of term, likely certainly the investments around will accretive we beneficial cash into near and of flows the the repayment term always, direct As but opportunistic be for short use a as long-term future most debt capital.

Our since that debt remain balance no shape we until our under financings. maturity be future refinanced around could now XXXX. maturities of timing easily to great with is in sheet And comfortable October are revolver, opportunistic

a in We we are retain routinely to very preferred markets good debt capital. issuer use access the and

exposed We our interest finished now the quarter to debt thus, only with we significant for rate XX% modestly of and fixed fluctuations. are

a position. throughout continue in year. opportunity feel further and significant floating the to We stable to expected debt exposure with about current fundamentals to revolver good capital Our fortunate balance down as we decline sound, be very tremendous rate outstanding is feel long-term business ahead. also We paying our our

Our have to there meeting be and needs and team them customers significant shared customers success. to our want to needs. our their network I in contributions to our will we members support thank continue those for

that, now questions. ready with are we And Eric, for

Operator

[Operator with James. Prentiss Raymond Rick we will hear from Instructions] And first,

Ric Prentiss

$X Good the [ph]. activity there. item questions said really some MLA news afternoon, AT&T big it million by everybody. I think, driven Randy, appreciate, lease MLA, Obviously, AT&T increase have I was of on the I you

Jeff Stoops

can hearing trouble up? Rick, right? you We're speak you having

Ric Prentiss

Can me you better hear now?

Jeff Stoops

better. you. Thank That's much

Ric Prentiss

that with appreciate then A I sorry couple others maybe in. also it now? that of suggesting on of It's doing thinking as came it. And the flattish color You questions AT&T phone bet. about of any is that something exit Yes, Yes, be busy. the from I'm the And we MLA around you're Why guidance should activity had kind looks should we $X lease million I increase in call way next of over it. of 'XX, that be like another about come new quarters. like we on? working the And thinking that. couple some

Brendan Cavanagh

Yes.

on little on increase XX% second to we the XX% activity bit is MLA, MLA. to first of reported the and we last million is the was -- time, So the the the slower Obviously, quarter. [ph] all, was a that $X due numbers, basically what increased our in

expect contributor terms MLA we be So going forward. that the in it kick right away based will the a of will on and

terms that would cadence then the an as from see based into flat. carriers. I with bit quarter you'll see terms has lower to result it be would do the actually of the activity expect a on little we'll contribution trajectory the be to lower That's and In of really a the third fourth MLA. of slowing fairly the quarter. that And nothing other uptick in

that recall had expected you would continue will the trajectory correctly, we was I other If leaning that relates downward contributors. of as expect kind a year to it and throughout

beneficial the deal believe works both signal on is to why, be to been to with it transparent trying it's openness and and of this for our agreement we been in And over a type of for year. terms a In time our Rick, we enter this We've has were of structure agreement said, period working for not are that likely that AT&T knowing we agreement well We comment going so we on which But mutually as that hung on on want with this have. finding with as much to customers. really are agreements always other much have don't to just up customers. beneficial we we what's too into on organizations.

Ric Prentiss

other M&A the Because calculus still towards there's which out does on -- down not sounds there the it a me lot revolver. move back paying Okay. one of stock And one the buyback? the for When think like more that leverage about down when X.X choice. would be you're out? to buyback? first next But moves since to how Is do like your a year that stock further we Is lever probably item?

Jeff Stoops

Yes.

to overall rates X. stay stay prices be continue if for accretive. it's it down and good And think capital I the to will the -- obviously, position stock pay the same to revolver the to more continue same,

again. get So we Rick, to that ask you could when we that should point, question

Operator

And Rollins Michael Citi. next, with we'll hear from

Michael Rollins

of Can deal straight-line share does up opportunities? that the multiyear leasing way investors XXXX going these a domestic it about AT&T. Just on overall components comes think is the in SBA comprehensive curious, there to some element you with a this with of be deal, types of multiyear And comprehensive follow-up the should just or the change sometimes for side? in

Brendan Cavanagh

Yes, Mike.

So it operate certainly we AT&T. smooth will the way that with

ebbs it the relates we in impacts impact, numbers and impacts of minimal we that There that straight-line from there line straight-line in at perspective, I straight impacts So our a as particular it least some over would very be but think of flows. may terms have agreement. are of -- agreement term. to bit perhaps that a growth less expect this no the course will little straight-line that, From short the or reported

Michael Rollins

And just on the commentary on leasing.

there you unchanged this development are maybe So you the were Or little site the slower your development Was more in expectation revenues just levels. that guidance. the in more durability prepared earlier prior observed? did is year? business something that there some gave from different that activity was of changes you note But for maybe the that about spite a of anything your some

Jeff Stoops

Yes.

know well. business I site development think we very our

our work it entirely around on work primarily know almost towers. centers You

just enough last it in of year, actually continue to our that earlier comfort with So good we working have. we work through the Mike, from that the for the now backlog itself already And feel that's have spilling us some services a that and very year out it. guidance probably there's was booked over gives there

QX QX, So of levels of more of is year. it occurred last lot reflection a activity that a

Operator

Flannery with hear Stanley. And next, from Morgan we'll Simon

Simon Flannery

had is Or that targeting this temporary your the in change be just you was overall leverage more [ph]. any a And investment-grade wondering going point, is consideration on then I targets. -- talk could of to have just you on leverage just Great. that status?

Jeff Stoops

now, so assume continue that you If we can see interest rates rates Right Yes. temporary. and be it's temporary stay interest may watch should high, not it think where they I to go.

obtain. as decision leverage we're happens We paying the cash it's revolver of just to path and haven't investment do yet. further Actually, that use today. made we continue our best down think to decrease path grade get to the don't that cash. grade. makes so economic If It so much of which financial choose really Simon, should because But as were most conscious of investment to that, as it, look just discretionary to the a to effort going we our it I we easier best that as the at is you use

Simon Flannery

one And follow-up. just Yes. Great.

You several got think that your of some not SKU as portfolio the do XG. the your you earlier next a of you Do to mentioned of would years portfolio, in that lot versus out? think upgraded rural to you have that still sites been given initial build advantage that to

Jeff Stoops

Yes.

guide, is if works. guess, NFL from It it goes I cities, exactly think there. history any that's starts it the out I in how

Operator

And hear next, Morgan. with Phil JP Cusick we'll from

Phil Cusick

Two, fourth year. of -- on a well for of the run about Jeff, them expect quarter like Should just and are it think that? the next levels. steady exit from didn't this we service then And through XQ second year. I a running this expect guide sense? Do bit second, activity run decelerating year like to and in ahead or going than Does below. for AT&T, a like going sounds earlier into is it you activity year, comment we lower the well the you XQ as in next little to historical make to like are in probably decent now sounds sounds rate still rate ago if -- next should year it revenue your understand maybe services others And in year be things but this that are the think sounds I come there and can. How them then year? make going it versus you're

Jeff Stoops

ahead, Go Brendan.

Brendan Cavanagh

Yes.

around do about next to we first just contribution to million. But indicator -- quarter definitely So be year. $XX fourth million on leasing you're of clear that domestic $XX.X specifically, approximately we question, organic would an rate, that to expect I talking as run caution the be to as you the using

the And based but that year. mentioned be think taking as give trajectory And those heavily at get growth, the the yet expect XXXX on I just always based result, not growth earlier, last broadly and way the obviously just is when the will on We're levels explained of would XXXX next of As down instance, guidance numbers at we the that is a point. activity this you you to heavily place way leasing actually we next is leasing as ready took on year, kind numbers for step we've activity that it, move to of declining. into a happens year's this it lot it XXXX. activity place the year. that's end based about

be So of the number year. the little for before than bit we'll don't quarter of the indicative is of impacts the numbers believe we next but higher said the because MLA a I fourth for

Jeff Stoops

And Yes. we the now operationally Phil, far the will what as in leasing. revenue, of report largely we dictated XXXX what with do half by services be first as

different We that. of have X components

and which that's cycle. is of site part the taking We the because we acquisition a have activity the of is construction planning lot place which where the the then current stuff last have component the is

the We'll we'll by of guidance out will where services So we but see. the we out year. with rest it how the impacted finish heavily on come see obviously be

Operator

And Atkin next, with from we'll Jonathan hear RBC.

Jonathan Atkin

to following just contextualize of how was MLA, based in the interested this year, segmental be next usage in can be we I kind revenue. year considered your as to of So to fairly opposed -- for revenues much year, doing locked AT&T the

Brendan Cavanagh

the just overall revenue revenue? of or Yes, percentage mean the AT&T you

Jonathan Atkin

about whole of much of kind versus Overall a for we more the revenue the. do how lock kind base think company, is how

Brendan Cavanagh

customers out. are or we And John, numbers fluid agreements amounts a obviously specific with up and those can't number give Right. unknown. obviously, other end of where our

to hard well. percentage, a say as as it's So

do portion now our it of specific in is So some locked we wasn't that we before. about revenue that very under agreement base but be have this can't

Jeff Stoops

that. the still And I that. we have other that's agreements, a I a exists some have think under AT&T portion probably on then number not And focused of greater of don't although mean we that

we is Jonathan, revenue. a the under can it's So answer, best greater AT&T much that extent the

Jonathan Atkin

agreements as comparing other other to towercos opposed carriers your assuming? that to agreements you're AT&T, and with with I'm Then

Jeff Stoops

Yes. correct. Correct.

Jonathan Atkin

Got guidance it. Yes, understood. give around and new some trajectory And towers us directional just ground then around Eastman's the maybe activity. and building lease

Jeff Stoops

continue little Yes. to for we arose. new so It's good lease all. financially the United at United opportunities put South purchases just the long extensions nothing's really look it I international purchases terms outside and because would into mean largest mostly outside changed been more smart Africa, ground our we And at build States. in the But moved which land United changed the of and mix a X there. in opportunities. hasn't We We're a if we've extensions markets and those doing the on Brazil primarily capital bit steady States. the have focus more States particularly

Jonathan Atkin

And terms what versus on portfolios, increasing and your markets purchasing of geography then are scale or in there in your footprint? some tuck-in and Africa history either about elsewhere maybe your expanding -- operating the thinking you're other thoughts opportunities, that existing maybe

Jeff Stoops

the question been right pretty the will same the answer to is much as for for do I has years that mean, deal, it. it Yes. we

point to our back preferred go that. it's If Tanzania use revolver growth going base feel market we be cash all market. new pay market the the the we growth because filled. found right as the a example needs into more to I over new much it that discretionary In But we decision to no because is financially deal but straightforward. have would strategic that to be of driven, down a of still and would We existing makes investment good to hole

Jonathan Atkin

have but the this the of duration AT&T might I Lastly, missed MLA?

Brendan Cavanagh

years, It's X Jonathan.

Operator

David from with Barden hear Bank we'll next, of And America.

David Barden

I X. So maybe guess

terms cons The in competitors just construction you an business frozen the in should more lean actions optimal an at the in as we for business Mark, Or people of business? towers with at there we maybe term to your and that willing cost resources model loan are second, if up long-term the Is respect to first about respect go to how taking the one, give then opportunity is the XX with for address as for of is the margin think What are being all? that Street ahead expectations to in And some to maybe be redirect we what the roll plan? about opportunity for its there think guys ways? fixed, the maturity Jeff, doing in it?

Jeff Stoops

to Dave, expert defer I'm going our that to here, Brendan.

Brendan Cavanagh

services the that's On recall, how question, of you history. had Actually, David, lot a started. we've SBA

up, cost have down a that ramp allows So we to a subcontracted we structure us very flexible ramp use lot of tower crews.

has praise are our for subcontracted really us for terms they and We efficiencies. have tower of and well towers for customers served high X is greatly by in our using things that our also market them, this to us our And on the people work use but we own speed benefited of crews. services give

think that I So changes. don't

to had look if our X options X business. that confidence afraid to of guess out or lean lean we lean to and choose I that in, do we'll in be not your I So because how of in manage

Mark DeRussy

to curve of forward will in then enough mean just like-for-like And I play And that if that are would the plays that's I up they loan, assume slightly be expect probably benchmark, Dave, similar term And will at refinancing. the to future how SOFA best we, terms it's only mean, doesn't a out. see where but matter I that can think, how it I say a question yes. today it looking for thing, your to that similar of But from into when of rate. but we'll do necessarily spreads on is out. to have using the the people the modeling,

probably be evaluating use. instruments have will mix that We -- we we options. be may of will There a multiple different different

now But right I things thing some we floating instrument. modeling the that, fixed frankly, Some best day. but do and the assume every and on long simply to be may is all be just you're us think for like-for-like out are term, a if may look at table to

Operator

Piecyk we'll with next, Walter from And hear LightShed.

Walter Piecyk

Perfect. right. All

Sorry. if MLA, would -- the terms of half second you off still the in The of you that the year? faster didn't fall Or have XX thought would AT&T stick? than accelerating the

Brendan Cavanagh

answer elements can't otherwise, because question, activity Walt, into that types many go of what would be I so really those it. things. with the there's AT&T, that

be, would to into very recognition, we're do expect Difficulty] that quite say dynamic while. pick through given what this and that's had. just will you DISH But [Technical between pause, little as next delay given But has would customers bit a there. you for revenue can't slowdown weigh like deadline a major a similar First, if for somewhat would of individual term, there. But year-over-year and that busy up. a the were on what they it going will, next on will And obviously, there's still or to we a T-Mobile year. very, sure eventually signings was but and year. discuss gotten a that. we related for There's to really that So of the I don't that we I frankly working longer expect have well lot

can... we So

Walter Piecyk

something was qualitatively? do those there if are? issues So What incremental like think you

Brendan Cavanagh

If sense? there what incremental was in something

Walter Piecyk

a to something continue fourth in or in into slowdown just think in I job QX expecting -- and worse? again, less the you little is of already you're a you're historically trying that guys saying a I'm was maybe quarter the year? get response good into just and about XXXX. sense there because, would also you third second did just how gave, carry talking You bit that And the half meaning new And to the a of

Brendan Cavanagh

don't particularly think Yes. I new. there's something

I a had than it's before. think bit been slower little directionally, what still the But same. it's we anticipated

carriers. still the does for get I marginally mean to to that yet. not that year? difference it's half mean year or the worse We're you million of other go. what what can't tell Does we terms But So there thought balance we million. $XX in ready of than have next $X the and

Jeff Stoops

benefits C-band to it's QX or T-Mobile positives their bill be the early hasn't going to look QX the which got on late DISH to to I is yet. even the X.X started, qualitative all whether XXXX large. and The get has or forward spectrum mean,

folks you on got equipment. -- the band of waiting some dual You availability got

kinds all as to to the move look forward into through year of we there's and So things next.

Walter Piecyk

Are you Jeff? cable, seeing anything from

Jeff Stoops

Little the needle. but move to anyone bit not to enough the it's impression going give

Operator

we'll with next hear Levi And from UBS. Batya

Batya Levi

is similar we you lay. A sites? the it follow-up and give equipment assume that the on look Does Great. one, X%, exclude that has like escalator you amendments And the if how new we all mix X.X% a in on another believe XX-XX DISH? said leases. AT&T should of I to towers And will the that cover there just that have? for AT&T sense quick us Can you your

Brendan Cavanagh

Yes.

So I'm sorry, what was of the first the part question?

Batya Levi

MLA, includes with the it and you sites AT&T escalator. if all have the they

Brendan Cavanagh

Right.

our but sites vast it the be -- around exceptions majority individual a by of MLA. specific the sites may there are covered So does few issues of because

Jeff Stoops

AT&T have That on.

Brendan Cavanagh

escalator that And escalator Yes, of that we on I our north of the the get but with would been X% piece, continue. historical AT&T course. expect specifics really is on to can't and around escalator what into AT&T then has have the

Batya Levi

without amendments Great. higher And XX%? much is the the DASH, than that

Brendan Cavanagh

mix, much total. would higher It of would you of the of amendments be DISH took percentage if would be. have out It the you a

Batya Levi

a just quick Maybe Okay. one.

give can exit us year? -- on sense you DISH the as assumes As the what guidance we you a for

Brendan Cavanagh

was kind give it's specificity than but it No, less was it that much we last less can't of Much year. exiting you now.

Operator

we'll Nick next, MoffettNathanson. from hear with Deo And Del

Nick Del Deo

deal, should First, as similar And it into the years the do you'll over feel near you totality get revenue have expected that otherwise you course latter forward think been. would revenue AT&T of to AT&T that of in some would that regarding contract have the we future? pulling what otherwise the is the that of the the from

Jeff Stoops

the yes. a think to the of part it's The answer part, question your first answer is to last pull I The forward. don't

Brendan Cavanagh

exactly obviously, would because, they be specific of don't timing say it's mean when timing previously, hard would be. very to signing what to were We things. it know that I the

be be could could So forward, pulling pushing.

Jeff Stoops

question of answer known The levels by Yes. to be AT&T's hindsight only will in the activity. your

Nick Del Deo

Okay.

Is fair? necessarily think of that it, a a been. bit more, reallocation should not have revenue sort mass but it smoothing would of the of we what call So

Jeff Stoops

Yes.

Nick Del Deo

Yes.

segment? international Okay, and was two quarter's results? your forecast it And up And What noted then other it went What second, what million revenue And in $X by from? which of for in the million was about can you this remarks -- it like in clarifications was guidance. elaborate a bit on quarter's it your great. was then, behind reclassifications reclassified you looks kind cost for Brendan. that? prepared versus to $X that One, last

Brendan Cavanagh

Yes.

of And the mix the So in up we of international quarter. that frankly, recovery was have was did revenue that is dogs, also particular. then end. roughly is year. the seen There higher not a and cash did increased termination And not quarter forecast in the -- we've other thing but It's to things. just of some necessarily There they expectations that subsequent half in basis that and second of balance some some and the actually year. X frankly the it's some was other cats even fees. actually add And Nick for we balance

that's piece it. So that of

expected the decommissioning some our reclassification impairment after carrier-related the it accounting been basically classification equipment and a equipment, recording of previously to revenue. best of was that for revenue, determined as we do of sites some was oriented accountants, has cost it had basically that at direct that cost a Sprint of But with our discussion costs. tower the had or with On decommissioning

a and decommission So just into revenue basically, and those move it's costs. costs impairment cost of of out of

Nick Del Deo

Okay.

a true-up? onetime of So sort

Brendan Cavanagh

there we've way true-up forward that's also that guidance but be the some the tower to given assumed There and around was onetime that's within cash flow. in going

Nick Del Deo

the about the you of attributable share be beyond to in year? what that Can Okay. $X for full much it change anything was the how million the quarter, recognized would

Brendan Cavanagh

another roughly $X It's million. Yes.

Operator

hear we'll Goldman with Brett Feldman next, Sachs. And from

Brett Feldman

question typically our do your because agreements agreement. leasing. of call use it they own MLAs in come amount way, guidance mind. or and got questions, out it's I that that holistic straight-line of by know announce revenue. agreement, When it's about "Oh, versions Two say, their whatever for you they don't raising it, them, if peers we're some or announced the not uncommon when they maybe escalators of commitment incremental made some earlier some you for didn't there's other or this that And with but this you was a

we're there's very get I And larger these and to the but feel framing some entering I like the been of what that. imagine you because about to think MLA agreements? can So on I'm it question is, you've questions going into do you been way know selective accomplished ultimately, through a trying right

moment, that own, that might particularly the to is same a you the years be probably I do. why focus your as been in do maybe attractive then when as growth And is And SBA to accretive priority starting the down own XX-plus long-term don't you analyst time. this whenever develop thing for outside opportunity? targets. the of portfolio get But most second just and on or going types could and not for started nearly you I those U.S. portfolios same paying very the economically your meeting, suspect markets we portfolios remember about talking the you think you to a portfolio in ago tower are be question it's long you're right is to the past want are has first growth now revolver understandable don't know, Or the

Jeff Stoops

I capital. growth of always today. I function believe mean, investment highest in and will all preference it we I potential take be desirable long the want, and that last pricing today don't availability will I falls portfolio year. where the growth XX% we prioritization works and allocation portfolio Brett, cost last mind, assets. grew our debt keep the falls it of portfolio changing. But most Where out, an one of that purely result of a and is as of see as to achieve first.

Brendan Cavanagh

the with line to but the MLA, Brett, the offset is churn straight a on Yes. couldn't see of there in by small associated mentioned we for some Sprint was And that some the you was decrease there actually straight that earlier. question straight actually it line line around impact accelerated actually

upfront. like terms specifically. of and small But same in the speak that will a what what as is they're terms commitments obviously, a it's impact. deal but would take it straight-line it's different. not some there more it agreements. are impact a looks to really, function going in of be result we've what certain can't are have I'm sure forward, of exactly done when probably future, I place. of this And there peers there So timing driven our But done, in there activity the terms that a I is little than expect

Jeff Stoops

see opposed straight-line the over on various years, It levels time benefits triggers will the course you of will to as and -- based Brett, X opposed upon as to over signing. activity

Operator

hear we'll from And New with Street. Chaplin next, Jonathan [ph]

Unidentified Analyst

accretive of to share yield moment-by-moment the determination? of in AFFO just get How of relative that assumed put How this flow? repurchase? are direction question. yield? is consideration guidance? the revolver market sort your drives DISH. activity paying the down rates half accretion most of into decision the do buying that there very basic taking One you Is do what free the anything a is DISH in debt just your it from you you're as the when And that just against you on for Is the stock in cash from of Or revolver? that you paying down a is second then or new back as make of assess year follow-up whether sort use the question leasing up you simple the it And

Brendan Cavanagh

it. is relevant is revolver as the actually whole that we debt. any flow look accretive buying basic There's to our and be piece mentioned certainly for think long expectations back versus financing is pay term number what as costs The relative our down growth growth. save that more what's it can accretion and And yield at stock of you paying revolver for or a takes as analysis today our balance But right also to to sheet account the the which the cash into we what will or that future positioning straightforward by refinancing our things. and a now, of we we look today. well at also down

Jeff Stoops

have sheet that go. interest cost a major when And on in with way balance We pay we over, that. buy a stopped And both don't business going we Jonathan, one it down one while it's interest have the revolver. know perspective as our which have the you we and up, when where the up. know interest bodes don't and revolver just we that an rates the to comfort stock certainly stock back. take today repurchases, And that towards is rate balance accretion always perspective affects increasing an when can Yes. immediately rates exception think go perspective, But environment we from from --

Brendan Cavanagh

they talked ton over XX% But and of their this expect around would goal a to they And that, we did of DISH them. us meet contributor year, them. all expect do, the that with been ultimately, as in turn business have the second least to less the into half about sometime up year, terms terms will signed in at we'll a of end we see, next that the continue year it's executions because that as of the the for the we to But new for slower year. half we year. to at or significant the mentioned, last being with obviously There's of impact numbers with second business still

Operator

Wells hear And we'll with Eric from Fargo. Luebchow next,

Eric Luebchow

you'd could investment going And now. grade. get how to to part on you at you know on theoretically, question you right is your to do of that what back not leverage quickly target based have plan did do type where Just you today? there? I the leverage the But think get think clearly there that's if decision, of make

Brendan Cavanagh

being within would a are half to be thresholds one it commitment the there leverage turn there than getting would least by certainly agencies it the right but by hitting the of now, at based agencies more to tier. very that the leverage close there, on or staying be there. Well, the of being about of about we're

Eric Luebchow

NPV other I would that to business? guys then Understood. carriers Yes. case-by-case a really it to another into your question entering the basis just indicates out simpler the Or some on this the you just smooth all think for you volatility? is positive of would open with of comprehensive be MLA. mean And it leasing arrangements does maybe be some what still

Jeff Stoops

think, Yes. I that mean the always be would mean openness. really evidence I we said is But latter. mean, a this, we've it's I open to variety I of structures

So do structures deal, customers. for right with the Eric, our we would number any of

Operator

will Brendan from with next hear And Barclays. Lynch

Brendan Lynch

market a the then AT&T, number have perspective I your any the Have few on changed? and MLA give level, with Belaboring point, of maybe has now customers if us changed? with maybe And you the the the payment just changed? Tim high given Or sites, specifics along has could schedule. minimum

that years longer. be You the for leases helpful. around are Any I'd imagine was sort much but X mentioned details of it would

Brendan Cavanagh

Yes.

X -- stay terms us lot will to years. But us and keep customers. that of and would agreement expect a details, asked I about that obviously important beyond there to extend ramifications things somewhat the need There's a be is would that in I keep lot specific both you from there it we most of our a of away for confidential of think X-year for are the those.

history. time this we've in the terms in I -- obviously, In always of Jeff M&A different open in think earlier. been of It's general, at answered points kind structures, different to our

the or terms whatever they haven't necessarily our us found to We work be that may to customers, beneficial case be. found for didn't we

with we we've we've MLAs with with had over of have the Verizon, those. today structures, MLAs years we've various done T-Mobile and in So in MLA less DISH. But done

we've that dependent needs and these done X their before what but upon the is carrier agreements parties. specifics each works for both time So at around the and

the So in I holistically don't changed anything out that know has market broadly.

Jeff Stoops

to as lead approach be are it at we big trying customers, and the that and responsible to how continue mean, could kind our Yes. if this I the more these things one. or while to only time picture to shareholders. the to will we same responsive our to of being ourselves and be could be

Brendan Lynch

to a point. just Maybe clarify

arrangement pricing is being think to AT&T described you've way past better would there think as menus. or some you how about of I MLAs it? characterize this your that with Is a

Jeff Stoops

Yes. that. towers. our to be than This be having a This would exchange little would different use in certain for rights AT&T payments

Operator

TD And now Greg we'll Cowen. from Williams with hear

Greg Williams

hang sounds to any XXs any with developments of are can the out by terms it'll Just with you anything for in like Anything first question here? And margins low beyond hopeful on few you in on just about other quarters. done site Tim discussions ongoing the service year-end? from second, the then the are you And next carriers, development, think it further them? having get

Brendan Cavanagh

Yes.

possible we'll specifically would The what we at On having to question, a you've took other but seen for reach a other talking deals be volume other we I know some do expect are to premature one, will the the that would lower on question, development the of but on if pretty may similar that basis hair that it's year. during this let stay pretty you time. over believe us there truck iWireless them be the yes, flat. that margins those And carriers. with you're then first oil with about say. I And And the arrangements carriers with percentage site conversations it's half obviously,

about right. quarters Your estimate so of around XX is probably or

Operator

at time. no this And we have further questions

Jeff Stoops

for getting forward this third together thank back Well, joining to us October our in to quarter Thank want we I everyone and Great. for late look evening report. you.

Operator

you for and for using does your today. conclude participation our for conference And that Event Conferencing. AT&T Thank

now disconnect. may You

SBA Communications (SBAC) 31 Jul 232023 Q2 Earnings call transcript