LMRK - Earnings call transcript Q3 2019 | Landmark Infrastructure Partners LP

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the Third Quarter 2019 Landmark Infrastructure Partners LP Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded [Operator Instructions].

I would now like to introduce your host for today's conference Marcelo Choi, Vice President of Investor Relations. sir. ahead, go Please

Marcelo Choi

and good are Partners' like Today, third operating and on Chief the share and following Doyle, your to presentation. George Brazy, our we welcome Chief Landmark an Presenting business of overview Infrastructure quarter call financial Officer. also morning. you take to questions today We'd the you will we'll Tim Thank Financial earnings Officer; call. Executive

are will to and like that all to include uncertainties. forward-looking and remind which actual uncertainties results factors today would I in to our A statements current our future participants from expectations. subject cause of risks certain periods comments number materially differ could

risks, For the file to encourage with you Partnership's documents a these read on complete SEC. discussion we earnings of the release and

FFO, for refer earnings non-GAAP of and and Please we EBITDA, such the filings as the these refer measures GAAP EBITDA their to Additionally, public definitions measures adjusted our AFFO, most during comparable call. to measures. reconciliations non-GAAP and to release may

And to Tim. the call over with turn that I'll

Tim Brazy

thanks and strategic morning an we're on our activities to discuss give developments recent results everyone. and quarter update good very operating much going financial you for our Today, initiatives. the Marcelo, and more and and

another In operating strong the we third and quarter, delivered of quarter financial results.

to continue months and creative XX acquisitions the to cash continues flows. made XX% escalators rent the Occupancy contribute generate past consistent portfolio stable and portfolio at that Our contractual rates remain and high to in performance. we've

contribute million annual October European comprised domestic million. assets. assets for consideration outdoor were wireless $XX total assets year-to-date $X.X primarily Those acquisitions, assets in and through to expected advertising of our we've XXst, and of XXX acquired Regarding communications rents are approximately approximately

discussed a on shifted on calls, initiatives. Now, to return, primarily from near-term its acquisition as higher higher focus driven development growth has growth strategy Landmark we've prior

assets of acquire been rate wireless our assets the development higher continue ground emphasis enhancement has better on and value Although, same a smart asset increasing of also cities on the basis, infrastructure, direct cap ground our providing selectively the time. for lease while outdoor lease at we and to a tenants our

The the assets the by target development existing and than our capability flow us these lease gives X,XXX more projects. stable and ground flexibility higher growing to portfolio cash generated returning of

As take we potentially these talked frequently and provide scalable initiatives with that deploy to longer their about, significantly together co-location and put lease investments but up us opportunities. larger

be for returns we As a the of investments the result capital risk appointments these favorable overall, on believe can invested partnership. adjusted very of types And these provide creative. most

said continuing initiatives. progress As third the we're we in quarter, to development significant with make our

sites kiosks generating For have of where XXXX. we're the example, the over to XXX transit right with area we're now in than kiosks first revenue to and DART, of expect the Dallas no later process across targeting rapid deploying of regard entire ground the footprints, in quarter

to details in earnings expect development more projects. our we provide make call more We with as progress next quarter's

across Again, reach projects ground that on meaningful lot very multiple time, effort by operating we'll the confident more as parties. made business, projects progress scale lease as said, and large see coordination much we said, requiring we're extremely a encouraged and our results. and impact complex these a these very of today, we're That are we've than our

to of number development potential also a working partners strategic build we're a out appointments real pipeline. of number additional discussions are projects, and with in our currently we addition, In estate in regarding

from puts position in with us will our up core and our benefit year, in we're to we XXXX position ground very the and consistent happy strong, developments to lease deliver. returns As ahead a stable and The our market. look results the growth next that wrap from assets,

strategic our confident we are a that for an believe unit results period transition and we This exciting and to growth transition time extremely development. necessary we're positioned forward. LMRK be but landmarks, to holder, will on in was focus well XXXX from deliver XXXX going is and show value

over a the turn quarter. will And more George provide the review with us in with financial to call detailed George? who that, I'll

George Doyle

Thank you, Tim.

his As predictable a lower Tim flows was decrease remarks, quarter, of our rental the mentioned In quarter. revenue assets perform, was million, quarter. from XX.X this XX% in opening generate again X% a and to year-over-year stable once continue third second portfolio and which as cash the

with no the prior rather as our are in of net accounted JV and on is third established of income of up for pick into the income in through those revenue we a As of the operating result calls, we equity JV. XXXX the equity investment longer quarter and Brookfield consolidated have our but unconsolidated outlined properties an JV method expenses, share

assets Brookfield that quarter. we're million to The the generated approximately JV, revenue of contribute Landmark the in rental $X.X

we second quarter, mentioned as the and assets million million. $XX.X consideration last quarter, $X.XX portfolio associated these of end the with addition, annual total In for assets a approximately of at as rents we totaled of sold XX

quarter, year. Turning $X.XX in diluted unit compared to this AFFO, per the $X.XX third FFO FFO quarter to was and of last

discussed we FFO on quarter-to-quarter can the have past fluctuate depending our value rate fair change calls, hedges. As interest of in in

impact on the was $X.XX losses AFFO, this last quarter, items in the other in of unrealized quarter excludes other per items. the several decline third which AFFO interest per of appreciation the sales, and The these unit unit with asset $X.XX is British gains due dollars U.S. rate the smaller our primarily various year. of recent along diluted pound to compared versus to and the hedges,

the facility of the notes under million were balance million sheet, borrowings our that debt fixed $XXX been of credit our ended or third and We $XXX fixed quarter through quarter XXX% interest debt rate Now approximately have either the rate quarter. at turning third outstanding end revolving borrowings of secured outstanding with approximately being our finished the swaps. we to with

the distribution was coverage of coverage quarter XXXX, our distribution ratio, third Regarding in XX%. the

the also said expected in coverage improve call, discussed that developments. last in quarter, be and but would it certain of timing we on As the quarter's to dependent third the distribution acquisitions

did the with close and projects, first regard of November continue pipeline From of to standpoint, assets service acquisitions into they to placed development our the certain In progress not the expected acquisition December. our to October. in the until in be majority half

As we we prior call, the outlined our on and in expected growth quarter of AFFO coverage full fourth the distribution.

increase We expect to one-time. per currently unit or AFFO around to be coverage our at and distribution

$X.X executed AFFO achieve $XX.X acquisitions in on million through growth to next totaling recent portfolio, leases XX revenue, expect approximately We annual rents an existing additional recent amendments providing unit with our across months rental per primarily $XXX,XXX million. of

be developments. The coverage in the service expected in will quarter. our the of distribution the and quarter fourth acquisitions developments on placed the anticipated to and depend into acquisitions timing of Lastly, fourth

into first into AFFO we As continue the expect we additional unit quarter XXXX, to service. per to increase of look are placed assets as

to continues generate development to we income, predictable this quarter. with into continue progress portfolio to with the and projects assets expected and stable summary, In our be placed service

recent With quarter service, through activity, be end beginning that of fourth are developments as XXXX. the well complete head October, the completed and the leasing acquisitions we positioned and into we into the to are placed

take now your will We questions.

Operator

from Ric Prentiss from Instructions] Our comes Raymond first [Operator question James.

now line is open. Your

Ric Prentiss

models? since on of do and as into half acquisitions mentioned the kind of Can might first Did do that front, the quarterly anything first in quarter the the think closed we revenue us acquisition most October. have Couple what rent added? you third of George, as to far of slip understand questions, I you help they acquisitions have

George Doyle

almost most small the part, but were There quarter everything closed acquisitions some were actual for ones, Yes, third the very in October. limited.

Ric Prentiss

hoping were help those And is quarter. timing mentioned Okay. creates the acquisitions? have the of what quarter in in factor on gating the you third to ratio the timing? third dictating the some coverage kind of the You What to

George Doyle

delays. say would would you acquisitions, It real really than can things up. it's most be it's -- I unexpected in come see estate different type nothing seller

by you few but would due just say reach yes counterparty, find I acquisitions in slip. virtue happen altogether quarter, are you to we of we all ultimately, this your There up something acquisitions terms are end happened they targeting well, can as but, don't just didn't with other or acquiring. diligence Sometimes

So I this shifted it's quarter. just think out

Ric Prentiss

Okay, than DART no all development think right. opportunity, system And you 'XX. the later as we about then, XQ mentioned the

to start about it? generating. ultimately And there that do how should Is XXX you think think those DART pacing sites revenue and we being we the will these the How sites? about in of Some of ground system? revenue-generating get getting in the becoming

George Doyle

going is depend is how to our It's Sure. on many It's ultimately permitting whatever I goal number with get level. permitted, but we how depend themselves, we XXX-site approved to a to going authority. can can get have many factors. get jurisdiction of to mean, DART on to the going

get how many seen So, the it remains we to ground. in ultimately can be

range. number, and substantial in expect However, targeting get getting XXX-kiosk are we a up that -- do to we still

of queued We They're kiosks already have the up shipment -- we've U.S. in got for initial deployment. getting

expect the longer the take I even we we a QX in it QX. to ones little year, But revenue would and will hit in generating So, before it upwards that of possibly that say, the probably final those -- are start take will a start bit ground kiosk. install

So we probably see out relatively be across XXXX. consistently spread it's going to

the rest in then and spread of QX, out in the ground here Some over will XXXX. get them

Ric Prentiss

cost can how these firm per help is we be I much kiosk, and us it know And should the do you development order, the pretty XXX? is cost understand? assuming to

George Doyle

of kind run it -- $XXX,XXX, under per call kiosk kiosk -- per kiosks $XX,XXX-ish the they're roughly they're installed. so Yes,

of a So services insulation construction. be hardware the and to going that's portion portions, type

Ric Prentiss

one Okay. from me. Last

about smart the think And Tim to we How major the competition think you is? think your should how market? to these win I opportunities, cities, guys As these addressable mentioned orders? you bring would who table also about

George Doyle

it's with have are ongoing think to out is in of opportunity going be be believe participate I built-out, extended efforts additional those. pretty market going are on, going rolled period I the an time. we and areas and And being the to as densification XG to for large that an Sure.

the public with such competing companies, build companies groups of We the tower capital. traditional like infrastructure infrastructure the are companies, tower with private as some

macro think is, call makes environments. to be we It's the in out our us even type want where for we've it meant you're dense densification going be the necessarily developed traffic, permitted. necessarily unique technology What rolled that could or urban have have it full wouldn't of estate but areas networks a of in I if site, don't lot want real to the a

want hanging doesn't or size tower equipment tall XXX-foot off the infrastructure. existing in Something

sector. there think of DAR do can to in macro is in these tower owners, of we tall the We're type I have trying seen the successes deployments. where and that XXX-foot we plenty to going believe We municipalities, example. deployment that. not for we're have environment, bring we positioned other a good property well surrounding There's to solution, that's a good in That's something with compete fit working more where groups

of portion roll-out. XG densification this the We're on focused more

so antennas Our infrastructure XG, that of see XX-foot some of height these in you'll are the the is for the designed some largest can we range. in antenna and hide market

infrastructure that for be -- ready deploying So if certainly XG we're not could upgraded. deployment for moment, XG, even it is at it's equipment could the the a

of think for that all a of those nice out -- build densification gave us together things the So, the helping in I market kind networks. niche

Tim Brazy

Yes.

I this to comments. Just Ric, projects. rapid to is mean add really George's deployment build-to-suit

these the different be -- advantage look counterparties, market additional but are and for at in that on the depending can these rapidly a we're to the we gives position customized in us opportunity when scale projects. So competitive

Ric Prentiss

are up in Canada as well, right? And doing you one guys

George Doyle

and we're U.S. on Yes, the Canada focused now, right

Ric Prentiss

in DARTs like And the many planning? did quantity you the XXX has current what kind how of give project Canada about

George Doyle

to that many DART is a we're need there's Yes, up Same for would a across there, how numbers. for that of us but networks specific into not growing thing about and we DART, haven't with the something of will definitely mean I talk I been opportunity it's densification lot specifically going ready be traction given there's quite any footprint. say ground.

other some needs to will of little infrastructure it get bit telecom a well, takes of as be these, but everything for is There up. time some it wind

you get the in the these ground. done, you get all engineering actually things the the contracts, and lease Although, arrangements,

Ric Prentiss

hopefully and Is that? getting ratio one to coverage that Definitely above back one? then looking forward to

George Doyle

mean, push before I with in get from to have they one, there see should Yes, we've we quarter developments standpoint. And completed to reflected what that we have as start the wait date we which come another acquisition then visibility above we the result. it absolutely, how to as to online,

Operator

comes from our of question Thank you. Baird. next Dave And Rodgers

is line open. Your now

Dave Rodgers

have you Of the about, talked that approval do DART kiosks XXX many you today? for how

George Doyle

infrastructure interested rolled permitting call and in approval, is this honest. of having top a it, very site a initiative and DART. I out type head, of between my From to I This DART's joint footprint. Dave, ourselves don't across mean be their

I still through these we process. would of work expect majority the have by to So, approved but that get DART,

Dave Rodgers

quarter revenue fourth seem guess, better the sense? you the going XXX revenues. year, to are quarter we look point. about are of first confident vague from and I X% generate over guys deployment little we us next of then this generation talking or a a standpoint, that I as you pretty all mean, the Can you at XX%? talking It's of are give kind But

George Doyle

a a Sure. you the development quarter, the in quarter. year. unfortunately also that's vague of ground the think It these a XX%, the get we It deployed, whether the whether moving fourth be somewhere with projects portion the of deployed in part to depends but -- be expected might bit the we the range little first whether shifts go the just kiosks is XX% We in pieces as end them quarter and enter of are first number is around it there's to these. of fourth of lot the that difficulty decent into --

Dave Rodgers

That the was for fourth first tenant the and guessing, commitments in first you -- but deployments anticipate XX%, the and you the the have then, I'm quarter? do

George Doyle

do. we Yes,

Dave Rodgers

that give add you spend the been Canada, Okay. revenue your don't DART to-date? about if What generating Canada you total I to and together. rolled any development to details And you take guess, project Canada spend know DART? in and -- with you development lot your when but of I are total from into want mix what's a

George Doyle

to some starting stuff -- a do that bit maybe QX. ground little in you $XX now, are ground $XX go and million revenue so We probably not $XX The million, generating revenue I the range, more, -- maybe deployments is that million in mentioned of in say QX. we're to in no the expect the hitting the Let's yet. generate the

Dave Rodgers

comfortable the you guess, the Right, still what okay, in money you two into Canada, forward, pipeline deployments fourth I XXXX? anticipate do look putting with putting U.S. and as kind that's and just If more moving about thought in are ground you helpful. then that, and the and of does these look The the into like? spend acquisition given more What the pipeline, and development into you acquisitions? quarter both

George Doyle

$XX -- the Sure, date here fourth a we've are beyond fourth wouldn't pretty opportunities. acquisitions I acquired there its the We not of see interesting to of say beyond some we what number $XX is might there here healthy already It's but in quarter, we've do acquisition not disclosed, what quarter, huge pipeline the opportunities. actually quarter, completed. disclosed, fourth closing already to million some be in looking we've we've million at in

a still there of and see to going such think we for good are head cost assets, into capital in we our well. market opportunities next to do we but depend on to being acquisition acquisitions XXXX, attractive as anymore be we year of the As It's going XXXX. in it capital, sell as try whether want recycle out

Dave Rodgers

comment, that for me. last then just question to And last

side, coverage would away coverage? you once that can from pursue On disposition do that you the above you XXX%? distribution, Or your take guys of mean, to that you will will everything you disposition get the maintain a I

George Doyle

-- term, this we on little it could we back specific to Once it, as the going to but then look hit that a be beyond, bit expect at I around hit Yes. we the out once would XXXX get expect It it, prospectively. maintain move we're coverage maintained. depending XXX%, it quarter, I and long distribution you

the dispositions. selectively asset their we in of to sales, have as far dispose As attractive periodically opportunities something

part, higher of that mildly dilutive cap date but rate what just dilutive. ones selling very the not the we're cost for little most is our have been a is done than that bit to we've The it's debt,

asset I it. we've sale don't spent and we on been development redeployment. capital anticipate So, have amount dilutive projects these on big a Yes, we've fair for working of

the They're revenue. finally generating are be the point starting they has ground. go to the where point assets the a we're now to of at to in now starting spent, should lot been I think get money where the

point, again construction balance we've to to on And some spend in progress sheet of to going decline, at give us will the see give that what coverage, ultimately, and which borrowing us -- more EBITDA got some then don't and since us more you're borrowing. costs well, start capacity revenue, the more we start construction more any have hopefully, in progress give us as for purposes in provide

Operator

B. from Burke Thank FBR. you. comes And of question Liam our next Riley

Your is now line open.

Liam Burke

see along you George, mentioned complexity of EBITDA predictability experienced roll space, as anticipation any more out growth you in you these better move the become infrastructure but do in as internally these of you projects, planning? you this and

George Doyle

we over ultimately in things developments I that but deployments these time, developments get more about come that us off still forward. the more as I insight going give and on together Yes, to be how think pull throw timing, predictable, more think the unexpected there will think, projects yes, but or we able after initial of up unusual should become will do pieces projects, the

Liam Burke

the ago? on ago? income. gave or And vis-a-vis the rental a year that a directionally Or did you on down perform number JV, from a that Okay. how year Is up

George Doyle

Yes, much don't expectations. from would have rate, say with exact it the it growth but I last consistent is I pretty up year. performed

entire our around You somewhere generally that growth, X%, of is time, pretty owned we've organic generate see range. period for the portfolio this across the properties consistently a X.X%

as average in well. portfolios, our at portfolio It's pretty portfolio. that consistent There that seen attractive escalator It's growth. approximately on the other have X%. pretty generally we JV a And is

in somewhere that So, that unexpected should X.X%, growth of X% churn, having lot a the on be range. unless portfolio we're rate

Liam Burke

fourth growth rental JV related for should the And you'll to escalators. income, consolidated your look anniversary rates then quarter, this we at and the rental quarter looking traditional

George Doyle

we're to here, growth at today portfolio as have somewhere revenue. looking expect there organic escalators are X%, that where end portfolio, to the range the our expect around average. in -- is in it I I September X.X% Yes, at assets would the those continue November of it's Yes, that

Operator

Fargo. our from question And Fritzsche Wells next comes you. of Thank Jennifer

now open. Your is line

Jennifer Fritzsche

just the wanted carrier. I little to wireless from about a bit ask the activities

I down I'll change the there Are that it, Thank kind T-Mobile's business prepares about in all? outcome. been, this it's space lot guess trend? talk it a affect your you. has slowing for you at there been seeing of of any merger noticeable So, call about that in Or as

George Doyle

what that with the through Sure. is Sprint and and causing Yes, to think deploy and it further that it a T-Mobile in market see overall to from through we merger seems getting process going them win. about they what want that

say at different I a isn't of much is from the deployment market. what a disruption the The in in we deployments little about kind they lot that we're cross what would creating the carriers, create do good thing of so to a yes, So probably of see their of disruption merger bit the doing. is necessarily going moment for our that

Operator

Thank I closing any Tim to to session. this does at Brazy over the for question-and-answer you. conclude like would remarks. time, back our turn this call And now

Tim Brazy

thanks, us Sure, morning. and thanks everybody for joining this

we front traction. us, start the As and lot get great deployments about excited George we I've of have and especially as said, that opportunities to we're a position in a think the of

with financial meaningful of things take but share earnings that can and Company, impact more of call. next very we will Some get on the you the the expect have we a to results the projects are longer these on details done, confident to

thanks and So, have a great again, everybody day.

Operator

conference this gentlemen, call. participating. today's concludes you Thank for and Ladies

now disconnect. may You

Landmark Infrastructure Partners (LMRK) 6 Nov 192019 Q3 Earnings call transcript