10-KPeriod: FY2011

AMERICAN TOWER CORP /MA/ Annual Report, Year Ended Dec 31, 2011

Filed February 29, 2012For Securities:AMT

Summary

American Tower Corporation (AMT) is presenting its 2011 Form 10-K, highlighting a year of significant growth and a major strategic shift towards operating as a Real Estate Investment Trust (REIT) effective January 1, 2012. The company experienced a 23% increase in total revenues, reaching $2.44 billion, driven primarily by robust growth in its domestic and international rental and management segments. This expansion was fueled by both organic growth on existing sites and the acquisition of approximately 18,290 new communications sites. The company's international operations showed particularly strong growth, with revenues increasing by 73%. A key development for investors is the successful REIT conversion, which is expected to enhance shareholder returns through distributions. While this transition introduces new tax and operational considerations, management expresses confidence in its ability to meet REIT requirements. The company also continued its share repurchase program, returning capital to shareholders. Despite a challenging regulatory and competitive landscape, AMT's strategy of expanding its tower portfolio and focusing on site leasing positions it for continued growth in the wireless infrastructure sector.

Financial Highlights

53 data points
Beta

Revenue

$2.44B

Net Income

$396.46M

16.2% Net Margin

EPS (Diluted)

$0.99

Total Assets

$12.24B

Cash & Equivalents

$330.19M

Free Cash Flow

$1.17B

Financial Statements
Beta
Revenue$2.44B
SG&A Expenses$288.82M
Operating Expenses$1.52B
Operating Income$920.13M
Interest Expense$311.85M
Net Income$396.46M
EPS (Basic)$1.00
EPS (Diluted)$0.99
Shares Outstanding (Basic)395.71M
Shares Outstanding (Diluted)400.19M

Key Highlights

  • 1Total revenues increased by 23% to $2.44 billion in 2011, primarily driven by growth in rental and management operations.
  • 2International rental and management segment revenue grew significantly by 73%, reflecting successful expansion into new and existing markets.
  • 3The company successfully transitioned to operating as a REIT for federal income tax purposes effective January 1, 2012.
  • 4Approximately 18,290 new communications sites were added to the portfolio through acquisitions and construction.
  • 5Organic revenue growth from legacy sites, driven by new tenants and equipment additions, was a key contributor to overall revenue.
  • 6The company continued its stock repurchase program, buying back shares and returning capital to shareholders.
  • 7The company maintains a strong balance sheet with approximately $1.6 billion in available liquidity as of December 31, 2011.

Frequently Asked Questions

The primary driver of revenue growth was the expansion of its rental and management operations, both domestically and internationally. This growth was fueled by acquiring and constructing new communications sites, as well as organic growth from leasing additional space on existing sites to new and existing tenants.

The conversion to a REIT allows American Tower to qualify for pass-through tax treatment at the corporate level, provided it distributes at least 90% of its REIT taxable income to shareholders. This structure is generally intended to enhance shareholder returns through regular distributions. It also reflects a strategic shift in the company's operational and financial management to align with real estate investment trust principles.

The company has a significant amount of debt, approximately $7.2 billion as of December 31, 2011. However, the report indicates it generated sufficient cash flow from operations to cover its capital expenditures and cash interest obligations in 2011. The company also has substantial liquidity available through its credit facilities to manage its financial obligations and pursue its strategic initiatives.

Key risks include a potential decrease in demand for communications sites due to tenant consolidation, network sharing, or technological changes; dependence on a few large tenants; potential adverse effects from international operations, including currency fluctuations and political/economic risks; and the complexities and requirements of operating as a REIT, including the risk of failing to maintain REIT status.