AMT - Earnings call transcript Q2 2019 | American Tower Corporation

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the American Tower Second Quarter 2019 Earnings Call. [Operator Instructions]

I would now like to turn the conference over to our host, Mr. Igor Khislavsky. ahead. go Please

Igor Khislavsky

remarks morning second Good a you joining our for which of Relations Thank website our XXXX and earnings Tower’s www.americantower.com. prepared throughout to quarter will posted the conference American Investor we tab you. refer thank under call. presentation We’ve

for this follows. will be call agenda Our as morning’s

our summarize quickly the I’ll results for quarter. First, financial

Vice will And Next, for update on brief our Jim provide finally, Bartlett, results XXXX will Tom a and Taiclet, CFO, the comments, our detail. outlook CEO, Chairman, will President our quarter second in call Executive international open questions. up discuss After President business. and we and revised your our these more

operating of that call our of remind of I Examples and forward-looking expectations XXXX on risks these regarding I’ll statements and acquisitions pacing Before include, any number including industry other fact. growth, are will as and future this outlook, matters process Consolidation well the Carrier begin, statements trends, that magnitude as our allocation, not capital uncertainties. its statements Tower; you contain Indian and historical performance; regarding and American future pending impacts the a that involve

the our factors forth contained call expressed to differ aware in we Form XX, or to set morning’s future obligation be subsequent us We risk set urge factors you circumstances. you statements. and the results reflect factors those these no You update should these earnings filings release, the in and this XX-K forth Such and this SEC. actual undertake may for the forward-looking year to with we the ended December materially affect events cause that make other that in XXXX, in certain consider could information press those in in remind to from factors include

to our results please the of highlights our which financial X presentation, second Now, turn Slide for quarter.

Consolidation-Driven Churn. were growth as Carrier by as our impacted results Indian these expected, year-over-year well rates As

quarter, adjusted our the by $X.X X% share, and our billion; our AFFO billion, During X.X% AFFO to and X.X% and per million increased grew $XXX consolidated consolidated over to grew respectively. $X.X EBITDA per $X.XX and property X.X% revenue to share

Finally, to common Corporation than common $XXX million more per to XX% increased attributable $X.XX stockholders by net or American share. Tower income diluted

to view business. growth similar press few indicators We results trends our non-recurrence included of these of back normalized results important are release presentation, our the comments focused on second earnings the outlook of package. in of be to our in normalized and in last results underlying our our XXXX. rates of QX around updated supplemental for normalized Additionally, adjust these in and for many GAAP quarters, also the as churn in the Normalized the carrier will outlook rates India. growth settlement our consolidation-driven quarter the our XXXX Tata Reconciliations of of metrics impacts

I’ll call over the that, with And turn to Jim.

Jim Taiclet

to the business make and practice American good public these that anticipated Igor, Based U.S. on USA few filings between was of and I today, Department the which networks. everyone business. do center Tower’s the has just on public last then, past to continue on our Sprint, over remarks Dish expect Friday. a my by International But Thanks, to respective developments and their made result likely net want will positive Tower merger will today call. made with and plans impacts American U.S. Since we second Justice for have their at our T-Mobile statements quarter Consistent long-term. for on regarding what in agreements been on and the approved reports, first, comments morning T-Mobile

for expect significant our of and extensive While we combined there company rolls out XG, T-Mobile future. and the during would from may decommissioning as its optimizes portfolio network well sites U.S. be that also process some the new into the demand

deploy commitment June is a of Furthermore, XG Sprint’s has XXXX. facilities and capable XX% by to set business made prepaid acquire Dish broadband based the population serving network of to U.S. of

the a the near they transition as XXXX design we updates to transaction XG expect situation IoT do years. result, term, secure impact business not also expect develops network meaningful ongoing to announced from architecture a we provide over new we the going our with As as material mobile narrowband their In Dish, the current coming will and approval you forward. into recently full-fledged results

get let’s that, International our into business. With

believe our For outside the the and that communication diversity reach scale countries portfolio of is approximately sites in global U.S., unmatched. XX XXX,XXX we

work operating we result, significant network tenants, a revenues who on are NOI of accounted majority As of spend CapEx our U.S. $XX outside multinational together on who In served of large international property closely are markets second our year. a our nearly to this property to profit, aggregate dollar our an the well billion XX% and over with yield XX%. generating track the upwards positioned for business U.S. in our revenue comprised of and about quarter, of half

grow Towers and expected being the data expansion a just And extended that global mobile a the horizon. is as usage growing of in in programs over sites, The phenomenon. XXXX signed a XX% international dollar announced terms, recent revenue our portfolio acquisitions. U.S. approximately or May. The thesis and of rapid communications an In in estate but model new recurring for U.S., illustrating a organic steadily most selective not our of the example, seasoned we through result, built demand vintage yielding transaction growth our those time build is is overseas. combination Eaton We’ve internal is international to most underpinning this power to acquired real been prior

sites like we’ve begin international with for XX,XXX nearly a to two and their spend over minutes eight and now Mexico decades discussing Under I’ll that I’d countries. towers across key our America, of and premise, and each growth operated where owned Brazil, Latin have in drivers. few segments

primarily U.S. we network in countries spectrum are in America markets, in XG Just in XX,XXX on recent in Latin and and mid-bands across auctions, two to Today, as well. of a comparison, you low a region the are other Mexico, trend give Fueling have Brazil many this carriers largest and the deployments. and focused sites about our upcoming series

activity America, by scale over time for region. substantial our America continuing relationships Moreover, with the in America last tenant presence has in five Latin Movil resulted long mobile the the in new backed in and including Consequently, operators appetite business organic data Telefonica, and growth AT&T, in years, region, we’ve levels billings and averaged double-digit strong business of the Latin others. key the

from our for well outlook for towers, seeing America Latin to And for construction In with addition time. Latin new regional new build to solid continuing some we continue tower in organic versus XXXX now XX%, momentum America expect co-locations, XG significantly growth opportunities, and below in still demand year. we’re amendments new with penetration last solid in builds up

while of one well African place with improved of EMEA. and infrastructure markets consistent across are subscribers XX,XXX Vodafone, reserve connectivity in earlier to evolution, modernization in portfolio in usage. XXXX, Airtel the transition, the key that of coming relatively region including Moving of Eaton of stable have Towers a transaction. dollar while XX% particularly prospects our partnering with the growth on We there currently forward, and into carrier telecom many and Africa to fixed the with going French and investments the is others. bringing Africa, by economic entering over are another of given markets XG network opportunity region broadband Since wireless MTN, our line sites much hundreds Europe, mobile And We technology a limited X,XXX building result, recognized governments see plan. millions and U.S. as operators a aspects the site is of capacity has nearly their basis of key and we helped been tremendous on African in German and data most terms in greatly

At other penetration in see data markets, the mobile still time, a and our XX% fraction the average and is U.S. current what more on of advanced in usage African we countries. XG is under

the consequently more come builds. handsets, to constructing As another the and Tower of to existing wave American spent by smartphone Africans sites incremental with to upcoming advanced from begin in new portfolio positioning for tower as and as expected. expect We as for both see and using This sites usage down future decade better demand demand well prices of this macro significant Africa mobile benefit for data XX,XXX X,XXX. oriented continue we significant last acquiring towers, well part upside more to-date performed than has

to addition to acquisition, region be the build levels. Tower’s we’ve ramp XXXX roughly XXXX double our program In Eaton also expected new the to in with started build

and power greener power including batteries areas efficiency, operational be are solutions. industries great where our also unreliable, mobile while fuel Africa, innovative deploying through to technologies, reducing making our solar in carbon the program. generation next and We’re footprint actively grid progress tends many we lithium-ion In increasing

We reducing significantly more our enhance greenhouse emissions. $XX expect performance region, to time in XXXX to of gas million the same sites invest uptime at in while the than the

wireless is view, Finally, four credibly XG much and needed assets a and moving are years. the deploy throughout basis and carriers, BSNL. spectrum mobile India. funding has to coming Reliance the In support now The There capable customer to Jio, our technology Idea, of industry completing large country. communications the sufficient consolidation each Vodafone Airtel, XG to in

We demand XG for a well future today, garner of be of sites years smartphone India. relatively build-out come. month XX,XXX U.S. small those usage average to network bright then a India average with approximately a people adoption pattern India organic per are smartphone portfolio gigabits XX our on needed already in Incredibly, their believe than are network upwards significant XG-driven meet subscribers. using for to more to an of subscribers current only positioned solid that Although the of and indicates demand is a in for and proportion growth in access will

Consolidation we’ve we to some more growth of to growth said at as enabling tenant expect organic would levels point edge resume billings subsides, see organic Carrier as leading normalized of an in previously, Indian the trajectory. Beginning Churn upward XXXX,

constructing and is year anticipate build demand sites XG as also New we ramp India X,XXX deployments in this there. than more up robust

be think summarize, successful portfolio be region. us the long with of track, and our with to trends stable, major telecom in are carriers to the Indian period coupled positions macro To that that marketplace time industry in a the over on we our seems the now relationships right

the continues business, business international long-term to growth our consolidated to Latin migration to drive AFFO. America, we are tremendously strong is complementary We at our the to view in progress level continues for International tower U.S. global XG of India. the Tower, which confident majority additive core American our At and about and the as prospects EMEA

outlook. over that, details the hand So to of me through with our go updated let to and results it Tom our

Tom Bartlett

everyone. morning, Good Jim. thanks Hey,

earlier, results another strong highlighted EMEA, tenant billings improved sites construction X.X%, growth posted Igor quarter growth we U.S. As of than the of of more organic globally. organic in with and X,XXX

the will to acquire than with announced further with in tenants. while and which Eaton agreements, sites presence Also, now our other completed also Africa, expect build in in key We transaction, we acquisition together aligning multinational globally signed XXXX. Towers us more X,XXX our

let’s revised take at outlook that, quarter full for the our our look in-depth and an With results second year.

to X. So Slide if you please turn

generated X% carrier growth organic contributed driven of we and quarter, for Volume footprint. by our growth about of normalized nearly Churn the Consolidation-Driven impacts During Indian investments the growth, from billings of tenant co-locations across X%. this Carrier network consolidated amendments

Volume tenant revenue drove over billings escalators This Our just organic X% X% to and this from U.S. grew by co-locations was growth $X over business and X.X%. amendments of around with partially amendments. roughly carriers straight of growth, major contributed the offset of just business X%. this activity All over new billion non-cash growth in of nearly property lower contributed X% revenue, churn results, of in four line generated X.X%. form to roughly the of XX% well our impact was as the negative and market the as quarter,

international growth was international X% normalized quarter, growth the period a X%. rate of property X%, impact Churn. reported our this about billings a Our revenue was due Consolidation-Driven tenant of organic including revenue growth over Underpinning during to negative over Carrier Indian

Africa markets deployed tenants to our key the our growth continue as and throughout like trends strong normalized Brazil demand network their Solid to South drive build-outs. support capital

by contributed revenue over nearly nearly co-locations escalators business offsetting these run while items amendments Other was added New and about course rate items churn of from X% with X%. normal X% just X%. this growth,

throughout the Churn expected, sequentially we expect impacts the As Consolidation-Driven and year. continue Carrier were Indian financial these slightly impacts decline of the to lower to of remainder

levels tenant In contributions of the and several backfilling categories, which addition, settlements the QX rate revenue our non-run some million India elevated in results. positively of increased $XX included some from which higher than benefit in These impacted totaled pass-through typical revenue, included quarter. items roughly

nearly the the include added X,XXX over around XX,XXX just contributed and sites, day accelerate, the year. as built a of we’ve with X% ago. Idea billings over global to over in in than growth. from last Finally, the sites international our nearly continue year, from our India, as tenant across course result, to the These acquisition assets newly associated the well sites one new more we’ve revenue year towers doubling last nearly X,XXX Demand towers constructed as new for pace quarter, our the our a markets XX,XXX

New builds program, integral driving one part day continue an deployment returns. to of capital be attractive our

and additional opportunities fact, in initial XX% In for raise these yield we expect QX builds NOI averaged further. yields about lease-up to

real primarily estate macro remains and program their focused exclusive return build on superior recurring towers, given profile. new characteristics, franchise strong Our revenue,

in new particularly still of XG and reaches more markets. mature as less in the stages demand technology we’re that period believe we build long early subscribers, of a more Importantly,

Turning to X. Slide

We AFFO EBITDA our normalized EBITDA also grew of adjusted EBITDA XX% EBITDA straight increasing the over line revenue excluding with was and during to Normalized the margin and Adjusted solid adjusted over growth adjusted non-cash growth was generated our impact negative margin than consolidated more EBITDA by XX%. XX.X%. X% quarter. adjusted

and markets, our effectively and to and solar impactful continue manage efficiency expense where batteries of benefits enhance in from quarter optimize the our to emissions. to investments in during We to fuel. we continue operating in our and processes power invest the our SG&A sites reduce African recent power our particularly was lithium-ion continue This and realize

XX% for and result, a goals year our were compared period, generator to to as the the QX track run nearly As hit our down on prior energy hours we’re year. deployment green

basis, AFFO attributable to consolidated AFFO in strong consolidated X% XX% over consolidated stockholders partly On share share and or grew share, XX% AFFO X% per to generated Meanwhile, to a which consolidated AFFO increased AFFO with per interest per and also nearly share over AFFO We India. consolidated nearly and per normalized our is grew attributable growth, up $X.XX. ownership common XX%. growing nearly AFFO

Turning to X. Slide

updated Let’s for our a take now at XXXX. expectations look

expect for raising now tenant for U.S. segment We – and our growth outlook our X% at year. the are organic the of billings least

activity with customers investment to organic expectations result than we EMEA, organic America business reiterating ahead of to in basis. as X% on X% lower New mobile data running carrier America prior X% about for tenant in the assumptions, usage. billings Latin In our and X% are support to our year. Meanwhile, of assumptions, trends prior backed a we are by our are Latin growth we is billings and growth and a their India India normalized tenant X% outlook to of are churn consistent in seeing strong raising continued anticipated, and

and continue international higher our from now co-locations Taking growth international we by growth Carrier begins points organic return contributions when to positive a With amendments. normalized Indian the business to billings billings record as revised whole, year basis in a Churn XXX tenant be than XXXX impact anticipate U.S., subside. driven by expect to of nearly the our of outlook, organic we tenant to QX Consolidation-Driven also will

QX at items Slide by million Looking earlier. consolidated benefit I outperformance reflects as billings nearly the for our as are of we expectations XXXX property tenant raising X%. organic X, the or well revenue This [ph] discussed $XX

additional by outlook straight of $X line Our $X translational FX revenue, impacts. includes revised negative million million also offset about of partially

Flipping to Slide XX.

million conversion which adjusted property reflects adjusted set as our a the our in mentioned, the of roughly both in raising revenue well $XX EBITDA Services I adjusted revenue the for as by record from or additional This EBITDA $XX and X.X% segment, also new for EBITDA quarter. million. incremental We’re expectations strong just

the is increasing Lastly, and by our benefit our we embedded for includes EBITDA a consolidated costs, in spending operating million or adjusted CapEx basis, This are the reflecting primarily XX% outlook approximately year expectations share growth the maintenance financing and year. leverage half being $XX by higher AFFO lower the at of in for business. AFFO expect of normalized our of projected consolidated strong driven we the for higher slightly of midpoint, assumptions X%. the per back On nearly

holding or Finally, approximately million I result AFFO consolidated year steady will rate FX of in current as share the do for want incremental the our to the $X.XX note spot in compared to that rest $X per outlook.

Now, turning to XX. Slide

plans and Our capital reflect for of investment allocation the disciplined our year our global process portfolio. evaluation diversity

of XX% a XXXX Board subject dividend around our by to total in billion We discretion. to expect to $X.X grow

In our outlook, XX% way, augmenting of in and of would is driven discretionary, existing billion to new addition, at new on for be $XX site is year. X,XXX new ones. sites sites the as which This expectations, just our American the $X up deploy sites a we over building building midpoint by compared prior a plan for midpoint part, at macro expectations focused the in CapEx, to the over to of of capacity Tower. build our increase XXX record the X,XXX By million

by to We expect committed as past. Towers, we’ve also Year-to-date, billion, approximately $X.X global of done we attractive which through Eaton of further key Kenya and the presence markets our and announced for like and scale recently XXXX. acquisition in end our Ghana close tenants. continent, enhance M&A will a many solidify existing our the of including in of our to the we’ve $X.XX Uganda, plan in scale transaction major partner enhance and the are our Africa, wireless which This is carriers billion

included in assets Like the not in the around interests Latin for related quarter $XXX and impact $XXX primarily close XXX acquired other transaction, We’ve Towers any the outlook. United during million. we’ve U.S. these year-to-date additional around our from Eaton on in sites and to closed a of third total million, expect for also in property XXX States other current America sites

approximately Finally, mentioned, XXXX, the expect to we third included deploy cash the $XXX business. future global for billion paid I flow we the million our million the of generation in primarily we is pay In of in expand and total, inputs and billion capital April, expect $X.X first during the set approval. $XXX to enhance quarter to in subject just around for that Indian regulatory $X of our set to that second for scale

XXXX, see site with performance. attractive acquiring global sites Slide communication quality we’ve revenue strong you that driven strong by our more allocation constructing strategy can XX, to characteristics Since than high increased our Turning sevenfold, growth has and capital financial profiles. recurring count and

across time As consolidated a generated XX% by points. this more result, return per CAGR, while period, increasing on basis than invested AFFO we’ve a share capital XXX our

believe of forward, Looking organic to delivering history well to we growth. as selectively our in build portfolio we’re our continue positioned we grow strong

record at looking year to of I international markets. allocation earlier, we XX, our program And a our activity throughout XXXX Now in critical Slide continues our component new-build be expected of build as capital program. mentioned

initial to yields these the our are new teens. double lease and and mid the portfolio NOI fact, Importantly, EMEA performing These top digits, improve international up the we we returns sites approaching in with have as time over average ourselves. built of Asia assets, further of in continue that the builds sites many

dollar sites XX%. since yield before XXXX built of approximately U.S. NOI for are constructed sites even generating a average example, XXXX, International on an now basis, and XX% yield

we their tenants again to scale Given build multinational networks the we improve to business, macro new return the all carrier construction most one focused program tower of new sites. can the favorable primarily remains new helping committed adding remain profile, add accretive. our on ways Of our this sites of through our

summary, XX, trends quarter Turning organic solid footprint. our global to were second across and our in with results Slide strong

tenant billings X%. to continue billings Our raise in of us growth U.S. and growth America and solid. enabling to our U.S. least at quarter, the business organic outlook Meanwhile, organic full X.X% to year in Latin EMEA organic generated improve, trends remain Asia

and need India, assumptions the Brazil, demand consecutive driven from increased towers also density signed XXXX network to tremendous We XG. builds primarily elevated Combined for to deployment our and with portfolio of add site carriers Nigeria activity, year. transactions, continuing for to which including in for we our quarter, approximately expect speaks second this XX,XXX closed to M&A the incremental by support our new

while EBITDA Finally, common remained we AFFO to into second investment position maintaining for as AFFO a focused share share year. consolidated component be continued American up in and return financial to another solid Furthermore, year profile Tower growing per in per to and subject full consolidated nearly growth we normalized Overall, on great shaping XXXX the converted year for we’re our total committed results our of on quarter, to long for held and expect credit key a dividend adjusted XX% basis success. discretion, to our rating. grade the stock strong our now grow us policies firmly is and finishing top-line the by strong the Board

turn into the over can operator, that, Q&A. I’ll to the we some so With jump call Operator?

Operator

Our Thank the from first you. question line Instructions] Stanley]. Please comes [Operator of [Morgan ahead. go Flannery Simon

Simon Flannery

would might profit, expect terms the try if assume where on just time Sprint, would Thanks. XX% over Good from Jim, Great. comment to thanks Thank equations. likely as see you can overview recently lot Europe you much. and we’re you and we agreement on a get back goes operating And give churn to likely be then know that in decommissioning? lease value to to a of not the activity expect T-Mobile transition is for this of master of to XX-XX? Is the negotiate that that that to activity others, we American minimize the just growth just you something through, that maybe market? and the go just how on And it and you Tower, morning. merger, in Vodafone very to doing to international,

Jim Taiclet

Sure. far our – a as accelerated the met out, with target the always traded that Towers been investment major has But Europe deals I in piece. XXXX. of costs have since and we point growth in of American at international you so the mean, Simon, hasn’t really larger equation strategy Yes, criteria. I’ll start international asset

opportunities that asset team a at We’ve is there. looking standalone for operating our French actively current maximum We’re great to their two doing Europe and only businesses and new German growth in things, potential. got

hunt are over far here designed a going continually naturally XX%, long the and up to I the be the we company’s, to in here is as of a profit to grow overall period So say, as operating international as should percentage we time, as XG grow they these more the to we many lifecycle the our XG. towers, phases longer of XG to of about have timelines faster and because of are think from we’ve talked countries XG to deployment earlier because technology

So yes someday, and operating to coming someday M&A we’ll get international, was few the to that. on the our growth is we’ll other designed have system XX% the from – whole depend but flow, do it of U.S. going a profit there that’s and but rate factors,

it the at in its XG time we’re same that of to way the at T-Mobile agreement situation looking really global consumers. accelerate leadership that’s U.S. to that structure When the the retaining between achievement that highest the while least technology, this competitive positions T-Mobile, benefits Dish, Sprint the a and been announced level, at is comes at Department, Justice and industry

last So increasing to for sides week just Dish, has low to XG, course, this especially mid-band T-Mobile been for heard an will of from and mention the about talking that American I this of environment be about Tower, your already. answer Verizon, recently excellent and not especially AT&T equation, on believe with focus you’ve the spectrum question, Sprint, the

we us is what in a think to long-term U.S. great that’s for the really environment coalescing So,

of could already to we one industry of mean started imagine, the about the far talking of As the transactions of a are new transition, going we’re what – participants that as these about. talking MLA might some contours for course,

and do. parcel what we part that’s So of

XG in do and those is make that to to we’ve U.S., the much in high well-positioned more business Tower, sites just to customers it to capacity our of period making try to going really efficient, to while a work we XX,XXX good of but for transition, with our the for industry because in the place as as we’re can, We’re MLA transition got retain macro really accomplish with American that. each to XG that not

that our seen within be will us trajectory minimize over optimize churn situation before and a going trying the the growth to time. do period to work So, transition as you’ve much far long it facing as like forward of we’re our

Simon Flannery

Thanks Great. a lot.

Operator

you. Thank

the question next comes from ahead. go line Colby Company]. of Please [Cowen Our Synesael and

Colby Synesael

Thank questions you. Great. may. Two if I

your so that organic the you – just over notable of just talk from your First then second growth, X.X% X.X% imply year. the down half a the quarter, about raise first back just X%, in quarter, would the X% want to in off, which pretty U.S. in step can approximately to guidance

some a you adjusted growth some payments and you to you the guidance exiting more what’s if will relates I’m think the curious in what back up and know you you I able think anticipated. be that And high chance deceleration? get over Just that Thanks. low slightly seems still year next, would things be driving forecast risk the other what’s to what’s that for I already expect give of just now? in then I previously for That to growth secondly, pretty little bit single-digit, weren’t dynamic still call incremental on are How really beyond pretty specifics you market really announced. terms your rate it confident rate, curious as been India, that fluid, the double-digit right it, to to India guess, months? XX consolidation

Jim Taiclet

did organic Yes, XXXX. mind in coming actually into the in we than hi generating in rate, growth to be Colby. we’re With that in XXXX, business regards going more growth keep to

a it’s strong very year. very, So,

the the of quarter-by-quarter prior growth growth the function terms the a in quarters and timing rates In of basis, the it of on year. prior a a lot is of

the of you quarters XXXX, of very strong kind third if they’re at quarter so the us. very, look And and for fourth

half. And organic terms going the result, an it’s second having so of overall impact as the in growth a into

stronger half. growth. increase the that’s I half fourth do We second the X% but X%, quarter, in also than in to also have the first comps well the a slight impacting So, within the is tougher overall still expected, churn, believe in

in we’ve that XXXX, organic I very, continue rates back like next continue months core us. very with the So, and to growth strong we’re leading the growth growth six as going got update look carriers them rates to going the those we and we’ll applications in into are be our more into about think process search talk what but rings to will to nine XXXX,

Tom Bartlett

And for good as we is Colby, pipeline a got see goes, as to don’t forecast far organic of risk any really We actually is. as the growth material. it India XXXX

growth already in we’re fact, India, the billings tenant organic above In X% churn. ex consolidation

minus the churn that rate going gross It quarters go timing anyway. just kind expect what’s in it’s down matter be, So, we run the couple at just market to we’re that churn. through it’s roll-off of a the the the year of of would normal rest the of could and already consolidation of of a and

we’re XXXX for confident confident in achieving is in from short-term IRR only We period. target the making over in we’re the to but planning IRR for investments above achieving that’s that that the So, XX-year over that and quite objectives in we’re going very XX% models our our not we’re planning target market India, period us, India. really confident used achieve

the There will business. U.S. happening So, be as changes. one There’s a in long-term well. some it’s industry

our get but that is there and in for the there too takes there, stronger India, both I’d pre-consolidation, actually company. consolidation we path it could confident that time we’re a and be through Then confident will. We’re U.S. to say

Jim Taiclet

the over underpin be this next believe churn leases perspective, going an see and leases. last as – are to $X pure a with that’s on X on function a a again, that and XXX,XXX, from over growth million the of growth two years, well reexamine roughly we see if over in continue Colby to now, industry Right leases to a that, just And to leases, XXX,XXX we three million five continue basis years. current and the occurred

there growth in is So, market. strong the

Colby Synesael

Thank you.

Operator

you. Thank

Our of line Brandon Markets]. next question Nispel ahead. Please comes from [KeyBanc the Capital go

Brandon Nispel

market I guys. of and on Hey, question one the sort housekeeping One could. item if U.S.

wireless spending U.S. in the for you But sites terms you carriers. in other the things the of demand is to the capital have thing guys One mobile of always usage. point guys is tower your data from to pointed

anything M&A around share what two means capital on? I from a could was some you in can on on of the year XG of in churn hoping revenue to and you rest spending just potentially of update So, dollar particularly Then the you amount remaining India Maybe, that’s Thanks. perspective, going some thoughts exact us terms the XXXX? just property of in the that’s housekeeping. the expect

Jim Taiclet

the to demand. to Okay, XG kind in U.S. XX% continues we’re up U.S. me speak it’s transition. of the usage drives year go I you’re What’s can well you parameters the about interesting your how The plus Brandon of and when what our data even to into background as that app per keep main four actually it go, the every in that on one it up going the keeps And can or every years put reasons three it. using up? not is is, even refreshes people going of Jim. phone

video data people’s when draws that have you’re watching phones there app whatever. are using occur the So, a on or not even

drive to both video usage continue mobile So, in branded going devices. that’s coming these and uptake, in media to addition to are media on social in the

in U.S. we’re going to XX% today, by the data to technology years, we’re most growth transition continue be is using dealt actually while to really XG. will with confident the that something that network quite is some for the And of XG the XX we for to So, five have in plus time. next that that

wireless industry for from We the the as spend been industry for where plus existing on rate spend So going see is, years in managing at the capital they’re XG, go – network growth it to and roughly XG. and two to – billion XG the at introducing spending, a it’s groundwork $XX the going can’t the that’s on time. has XX% same transitioning scenario, because industry you One things less really laying have the look than U.S. and many plus that the would U.S., network.

billion based the as in entrepreneurism largest – be continue plus the the industry we of and there disruptives of dynamic that that’s and between on going the $XX the expected run well. Dish year bolster that industry there the So three to from there think need going rate in U.S., might is really of to been announced CapEx, opportunity a forward again, is to transaction actually of for competitive plus plenty spend the competitors

as capital XG. is XG stay that good move feel at we better from So, to to spending going we level or the same

Tom Bartlett

$XX question, expect Churn. QX, million million generated to $XX Carrier $XX actually about it of that in to the And Consolidated we’ve then range. the wind $XX million on the churn down. which QX, down to the we was $XX $XX said, again, into as would in to about in Indian In range million, expect million In QX, we we QX, million be

expect again, down a to ongoing the churn basis kind that that rates rate that kind the churn of you fall of kind significant a – in occurred of And couple we from as So X.X% consolidations expected – back again, into rate. run get over that on the we years. last of would of off X%,

Colby Synesael

for the Great. taking Thanks questions.

Operator

you. Thank

of line comes go [Bank of Our next David question Please Securities]. America from ahead. the Barden

David Barden

afterwards third, would that question Can then happen before really Dish second that to game the related to own close, you because of the the time questions. that Hey go just to time agreement loaded way it’s And I kind a is? details? you tower so long know it’s like Thank out been come before what just X back Where not a were of bit. Jim, I through, of U.S., ready will these. in the you’re they trying would XXX the towers. the question us looks will kind Tower they’re from? in acquisition looks guys. period, Thanks of it of think million guess, Would plan those walk be kind It is, happen? six-month And get option towers. then you their or since to you. of you ahead a trying pretty over of that until or quarter, like? the to with that did we have want when a figure look sites, I have for have just it taking to the could was decommission does little American then well and merger the had number could you Dish what kind the you big mean, one take know know where

Jim Taiclet

the let is for forecast information is of us the with to T-Mobile, company Sprint when start available me merger. results timing going model David, be time. our and So, to to as going The to evolve over

weeks states legal past of the resolved be that agreement there. needs set you As of very quickly. circuit the saw together with come over that another multi-party. There to couple It’s out of challenges is still this has

So, not available. over we and information learn the incremental number will the closing next probably, of all before be months will

I Sprint, the continue management are we So, teams, well-organized, these outstanding Verizon, will capable you highly competitive industry, each across Dish, very mean, closely. close each be of been We – side. to and our with size it’s T-Mobile, of frankly on very side, us have Remember, with as them incredibly management whether we with AT&T, tell of wireless three can tower I the us there’s only the of other. work teams on four

a disclosing in information way feel providing up it players these as this that now is manner understand us work We’ll and going to to step know going and will is with right look enough to what confidential no with every of comes or are light way for negotiations. comes, we predict either but their rollout the us and We it to to are it they when material there information that as each like. be they to

side help is we carriers to is their how that, give based out they on strategy of The will life. offers it tell these other each and us accentuate that there endeavoring be to of coming benefit to

process. and with take of that of a those, comes timing this agree all bill and way it rights on materials the along forecast So, to interactive gets each It’s we coming literally the we very and that the lot to. set a is time of whenever going it of down application as applications

to other There’s it. way time to So, it’s describe frankly. going take is no

sides. The on Dish we’ll into leases, the to dig option to all on have contracts take

yet We T-Mobile, there have we have MLAs Sprint, with with between parties. them have to don’t those contractual are Dish, obligations also we and access we them have with

or the created be So, information look do on maybe. once we to need will or as leases between we or again new contracts we us get towers Dish the case revised need, understand and the how all to assignments

finally, and from with we’re put the still in that of and is. transaction. some company important most is over then for a up we today. heavily just private Again, you the acquisition, the mouth U.S. AFFO our the where comes it’s catch do of us time, investing – still. mid-sized but U.S. The an of this announcement it’s we will, money sort long demonstrated if period International growth region our And will over that of

our which in much will the have. big will it. So, real is we too roll rent it than X% it come these we sites more the or will be in really some really last can’t portfolio, that – in with growth, a where high four so solid about disclose which we think be with value along is great already But tuck to and

it’s again, normal So just the with course of business us.

move particular to sellers to criteria us and that good position towers about surety this us. allows allows to feel meet scale fact with purchase our with able financial We’re to our The agreements counterparty. quickly to investment with making

normal just for course it’s So, ATC.

David Barden

Thanks, Jim.

Operator

you. Thank

line from Brett Our question go of Please ahead. the comes [Goldman Sachs]. next Feldman

Brett Feldman

Thanks.

you Just don’t mind. two if

Your other including in particularly quarter things strong were revenues also the but embedded think that fiber settlements, a are solutions I can in there. include your lot of revenues

franchise higher something emerging on been beyond of even going opportunities maybe the millimeter maybe any spectrum sort you it’s that though, insight to even is was then assumed would are So, little predominantly days line you. give in maybe, early But and wave we around U.S. you’re U.S., the whether recurring not if scope think, can in towers strength deployment to XG historically small And of seeing you anything, that’s if a you would on to level. was us just which one-time cells. estate the just be in interesting real that you. Thank there have just the and all item. new strength to extent around the interesting I see of be seeing and as there towers, Do deployments

Jim Taiclet

billing, straight of that we revenue rate, run timing exactly line, to these non-run these our the difficult back in things things difficult They’re it’s when are and doing day as generally determine of teams every kind the you things year types hit. are and revenue like the range. other the – said, the on that of Brett, to will forecast X% the of

And bit – X%. additional Latin like a we’ve over so work that’s another function This as range. higher of settlements quarter done back in America we’ll well X% in a Latin on that quarter again, some little Then billing, we’re that India, just markets it’s have pass-through. outsized, some as that small of bit that’s averaging quarter, but a particular kind bit undersized, and

candidly, very to difficult QX, we’ve definitely did in growth. QX, will impact items in of what thing outlook what contribute included be our to realize our we Don’t know there these, overall forecast, is in QX. So, but where other like the

Brett Feldman

appreciating Is there? fiber in that’s solutions, there in footnote, generally you mentioned under anything that? wondering As recurring you saw if we’re the I’m

Jim Taiclet

we’ve X,XXX we do I around Settlements, mean globe. I think got is customers that No, plus day. back billing something every the

those and of to on contracts And really on so like there terms, that. This certain are fiber. in are recurring. pure fact business. not driven be types largely settlements by driven events by going renegotiations just is going And our It’s things certain on, macro constantly

Brett Feldman

Got it.

Tom Bartlett

seen our for there we’ve when to of spectrum, some, business not of our wave significant to for are And towers those are Yes. And it kind going potentially millimeter on macro already today. be towers some macro opportunities classes deployments, comes adjacent XG. starting around Brett, many to the significant but but asset our them

other tower and and ones it the India bring to is need say XG in and Africa as So, one continue America, fiberize Latin to towers to the frankly, of from outside fiber in the the or they accelerate places. U.S., to XG largest will

we their those we’ve that fiber large anyway to that those can we will we countries business made need those we’re the We customers commitment passing or investments, they them the Telco that there in we’re then capital because right is allow to of the fiber, use side. fiber can then customers last to we our and a need places do charge manage. for that of of and when you mile. along ways deployments, because investments, large in homes, of if our some these do to and that In commitment tower retail that will where are – make wholesale go some not route industry don’t capacity on passing for we to some fiber retail tower businesses. to We And

go is So that one to opportunity XG. that will from XG

cost in it applying quite which indoor XG, of general Again, low kind need. spectrum, but think type very X.X use be is at cell to doesn’t exactly small general is you that bands, cost low serve still and apply being is thing necessarily buildings a that U.S. and and in an in unlicensed interesting, spectrum the the we’re U.S. band its in one, can with specific much access Another access I solution. XG the CBRS to that’s early days licensed more that to evolution, of spectrum and to there, a efficient deployed would have of it both a prioritization

kind also fibers interesting innovation compute see other we U.S. both markets outside of of will the going be towers on and an are side, edge the to CBRS more So, program. initiative to and needed. around XG And indoor that developed be

again, – customers now to be, now. to already relevant it little part the and on and can to and XG, get a get even the that capillary out bases longer finding parcel compute but So, even will and trying system will we’re is look but started what bit we and are exactly distributed storage think needs I there, horizon time and that like, who what really of that figure customer today, we’re be

Brett Feldman

you. Thank

Operator

you. Thank

Our from the comes Ric Prentiss go of question Please James]. ahead. line next [Raymond

Ric Prentiss

guys. there. Thanks. questions Brett’s wanted some up on to Good follow I morning, of

envision to report fiber rent? wholesale separately As improve you you plus you your think would property about from maybe doing day, tariff where of route. tower along more the the fiber a Do visibility

Tom Bartlett

But willing upwards to talk and the of it, where I to of invested array of types about I to terms in doing that it about decision-making, including and interested it to mean, things extent transparent be disclose a the on revenue. upon needs from areas X% what mean I clearly is that it bigger Yes, go need programs, our clearly that. it. of lot of are of there depending the size but would the candidly, like of we’re decision that in $X really be billion is. people around about in to mean, and Rich, innovation whole represents we’re being that able globe, the some probably we’ve to fiber,

now. we’ve our right business. small quite strategy by the And within elevation overall because of design, got are these it’s part So, that

Jim Taiclet

fiber if run to that the And investments, we’d in too Right. because tower the say out it here this macro Tom we the including time innovation split is I really the have. designed long portfolio referred – program that likely, whole just ever would enhance Ric,

Ric Prentiss

Right.

Jim Taiclet

tower once to customers, it’s valuable on stay probably or had or time. property whether see Tower the or more where embedded ground It’s some really it’s a of it makes share fiber it that So, our you whether its sites will more want offering, quite generators long edge an who be for sticky space American site you on. time is macro a business and that’s compute on for and for tower for part

Ric Prentiss

Tower get real to from funds out Infrastructure there disparity? Show, maybe multiple basis more at we and the debate thoughts of a worth AFFO need multiple a it on questions the at makes look I some available Any peers. more you get distribution, kind you look prefer of the for is cash. but multiple business Thus, likely on to it multiple Tower your is trading versus guys you And industry cash, in out people That and an one those seems tower know investors there. maybe comes for the your a about at that like And up maybe peers get lot there questions you’ve of think sense. of versus questions, shows reason is the some of American where

Jim Taiclet

this Well, let to say, me Ric. just way, address it

you meet U.S. return meet would that the States investment the outside into to acquisitions small the we to tower that’s cannot South in criteria the investments Africa, met to Tom out figure acquisitions in Our us criteria, as make time the – cetera, it fiber that’s outside And And for at or investments when criteria in apply or going to, too the seen really investment why The and towers have have U.S. acquisition how at. of achieve fiber exceeded the level macro U.S. U.S. relatively comes United But the you’re to the have countries. in same Argentina et never a towers have those only those see macro these, referred to our Brazil, us in

give a fiber as put ATC high in the is tower valuable, in investment money frankly, into. high just won’t growth as So, or and macro the you return just we we

been U.S., able to outside that are So, haven’t may ways decided growth we made. whether someone match not you if won’t the made to in inside tower where rates business, company find fiber have than be and go the we about to we a investments outside different on we – all returns it’s or discriminating this, the macro because

Ric Prentiss

Sure.

Tom Bartlett

talked do And opportunity, those by our to our Ric, markets about, of being Jim capital billion $XX invested of the is customers XX being able we markets. as in international were that, because in

a top on total you from billion. so will $XX of market $XX in we’re plus invested contributing in And of over U.S., perspective the a being that there opportunity billion if

that like And referred will we Jim as returns be too. able those tower drive is so that we where believe to

Ric Prentiss

guys. helpful. very Thanks That’s

Operator

Thank you.

line ahead. Our Batya go next from comes Please question of the [UBS]. Levi

Batya Levi

be press, growth to faster Thank basis international to the points XXX than you you. U.S. In points the had a for target basis XXX

is an wondering on billings growth of disruption timing? was And pricing, the as if ramping with question, that’s LatAm. on as wanted new you. to added much India due new can update tariffs accelerated new business kind really just get year, looks and It revenue Thank can you the to program, to that the profile see still not think that back just you maybe in like Now, you second behind build us in this an internationally. if I provide

Tom Bartlett

on perspective, of an saw we down is the think stable. The of I going remains some it just the very, I updated on, function is as in have year-over-year particularly, Batya, inflation our business new from guidance, program the a very think a have in mean, lower still one it. that but as those I of – do organic the builds From you some new contractual business timing you also in it even markets. strong. well

to organic lower, program I a growth the is so and impact churn as very the region. the growth that’s build from to a solid on new strong. is in because And but the churn and very those in the Brazil to is Nextel, basis points in have coming kind strong basis, XX just XXX business higher of overall slightly off very stable function say markets of the do year-over-year basis points items but inflation of want some of rates We

Jim Taiclet

of have second aggressive a this in we timing. in Latin build up the at and plan that’s And the think report, some quarter America, Batya, do point more showing in I tables

long still build things there’s a began question, in international period recently couple in those in of And normalize points on is to long will volume think growth the said still going into, including earlier, period a because delta on time, the some that actual a declined year-to-year year a So, we’ve for a that based of little some of there a CPI the earlier fluctuate higher growth markets. broadest in based to think is chosen factors, which outsized actually we in America be over basis rate that’s grow it markets international but smaller. all is then going U.S. When we inflation, than the time, American U.S., of at that number the to cycle, as XXX Tom Tower. go ramp-up over time of the level your Latin this

Batya Levi

you. Thank right. All

Operator

Thank you.

Inc.]. go ahead. next Please Rollins Our comes from question Michael [Citigroup,

Michael Rollins

Hi. the questions. for Thanks taking

two. have Just

the amendments, you in about First, was activity think that co-lo. was mentioned XX% U.S. I XX%

could it just at then be evolve a on tight going the could based they’re the your and also currency you And where more given of and a comments those co-lo, of return placements view as at XG is do years look where And how for rural next curious this suburbia, adjusted there narrative some capital returns you the of that then rates? few strategies if what current the international the as is at historical about For in look anticipations? are densification to dollars second, the you currency be denominator kind on business, common it the going, may there initial on narrative future deployment your common over of made that as Thanks. in we’re rate? in the is coverage, putting

Jim Taiclet

as in, kind and piece higher to I’ll it’s the is fill adding a or along of touched cafe the where that co-locations calculation. Greenfields tighter have suburban it’s requires there’s then us unusual cell-splitting maybe and on, business, reach go to whether that amendment The normal and to brand-new a in scope whether the The all environment. are also, as on. XX:XX those that our driving capacity you that of for happening. co-location more you rural breadth to theme ROIC consistent array There for programs Jim. suburban out kind piece people. band allows lines said, a the portfolio There to is spectrum coverage of a pretty others are continues co-location the us. with no in this places or Tom to to just it’s turn Mike, course is start for it U.S. over There’s the really

are as go. we up still towers the some of carriers We leasing from that have the with other Verizon co-locations

XG indoors gigahertz to higher and the be few They’re spectrum going you’re coming some years. X.X that higher band also read already in. coming from. minus in in denser and of proportion. you’ve fill going to that be there frequency, X.X and heard next band or And require So, spectrum C outdoors will nationwide in where co-los network environment this perhaps the plus the set well at X.X shorter-transmission sources initiatives about, radio as that a have that is over a in, bands coming in because of as come There’ll

where part you’ll see that. that’s a the big XG So of future will be co-locations of

Tom Bartlett

And financials. Mike, out the right out the mean I ROIC, current of on it comes

FX denominator rates. been current have adjusted the So, both and numerator in for

Michael Rollins

Thanks.

Operator

Thank you. There are no questions in the queue. Please continue.

Jim Taiclet

have day. Great. a Thank for you everyone and joining good

Igor Khislavsky

a Have now. everybody. of Yes. summer Bye the great rest

Operator

gentlemen, for AT&T does Ladies using your We may you conclude for you conference that and your for now today. disconnect. thank participation and Executive Service. Teleconference

American Tower (AMT) 31 Jul 192019 Q2 Earnings call transcript