10-QPeriod: Q1 FY2017

AMERICAN TOWER CORP /MA/ Quarterly Report for Q1 Ended Mar 31, 2017

Filed April 27, 2017For Securities:AMT

Summary

American Tower Corporation (AMT) reported strong top-line growth in its first quarter 2017 earnings, with total revenues increasing by 25% year-over-year to $1.62 billion. This growth was largely driven by significant increases in tenant billings across its property segments, particularly in Asia, EMEA, and Latin America, bolstered by recent acquisitions such as the Viom Networks and FPS Towers transactions. The company's operational efficiency is evident in the 20% increase in Adjusted EBITDA, which reached $997.7 million, indicating robust profitability from its core leasing business. Financially, AMT demonstrated solid cash flow generation, with operating activities providing $683.1 million. The company also actively managed its capital structure, undertaking strategic debt repayments and borrowings, including the redemption of its 7.25% senior notes. Despite increased interest expenses due to higher debt levels, the company maintained healthy liquidity, with over $2.4 billion in available credit and cash. The strong financial performance and strategic acquisitions position AMT for continued growth and shareholder value creation.

Financial Highlights

51 data points
Beta

Revenue

$1.62B

Net Income

$316.10M

19.6% Net Margin

EPS (Diluted)

$0.67

Total Assets

$32.06B

Cash & Equivalents

$712.80M

Free Cash Flow

$678.20M

Financial Statements
Beta
Revenue$1.62B
SG&A Expenses$164.80M
Operating Expenses$1.08B
Operating Income$531.40M
Interest Expense$183.69M
Net Income$316.10M
EPS (Basic)$0.68
EPS (Diluted)$0.67
Shares Outstanding (Basic)427.28M
Shares Outstanding (Diluted)430.20M

Key Highlights

  • 1Total revenues increased by 25% to $1.62 billion for the three months ended March 31, 2017, compared to the same period in 2016.
  • 2Adjusted EBITDA grew by 20% to $997.7 million, reflecting strong operational performance and revenue growth.
  • 3Operating cash flow was robust at $683.1 million, demonstrating the company's ability to generate cash from its core operations.
  • 4Significant revenue growth was observed in the Asia (336%), Latin America (24%), and EMEA (16%) property segments, driven by acquisitions and tenant billings.
  • 5The company redeemed its 7.25% senior unsecured notes due 2019, demonstrating proactive debt management.
  • 6Capital expenditures for the first quarter were $177.3 million, with planned full-year expenditures between $800 million and $900 million, indicating continued investment in growth.
  • 7The company resumed its share repurchase program, buying back $225 million in common stock during the quarter.

Frequently Asked Questions

Revenue growth was primarily driven by an increase in tenant billings across all property segments, particularly in Asia, EMEA, and Latin America. This growth was significantly bolstered by recent strategic acquisitions, including the Viom Networks acquisition in India and the FPS Towers acquisition in France. Contractual escalations on existing leases and the addition of new tenants (colocations) also contributed to revenue increases.

American Tower demonstrated active debt management by redeeming its 7.25% senior unsecured notes. They also utilized their credit facilities, borrowing $1.8 billion and repaying $517.9 million under the 2013 Credit Facility. As of March 31, 2017, the company maintained strong liquidity with over $2.4 billion in total available credit and cash. Despite an increase in interest expense due to higher average debt outstanding, the company believes its cash flow and borrowing capacity are sufficient to meet its obligations.

American Tower expects continued growth driven by increasing wireless data usage, the deployment of new technologies, and network densification by wireless carriers. They plan to supplement organic growth through selective acquisitions and development. The company anticipates capital expenditures for 2017 to be between $800 million and $900 million, indicating ongoing investment in their infrastructure to support future demand.

Yes, American Tower completed the acquisition of FPS Towers in France for approximately $771.3 million. This acquisition expanded their presence in the EMEA region. The company also noted post-closing adjustments for the 2016 Viom acquisition in India. They also acquired 22 smaller communications sites in the US, Nigeria, and Germany for $9.5 million.