01—Abstract
Summary
Summary of the 10-K filed March 1, 2022. Cited figures are marked; the original filing is the authoritative source.
SBA Communications Corporation (SBAC) reported 2021 total revenues of $2.31 billiona, up from $2.08 billion in 2020, with net income of $237.6 million versus $24.0 million a year earlier.
Site leasing generated 97.4% of total segment operating profit, and the company owned 34,177 towers at December 31, 2021, with 17,356 domestic and 16,821 international sites. Operating income rose to $782.5 millionb from $633.7 million, and cash provided by operating activities was $1.19 billion. Adjusted EBITDA, a non-GAAP measure defined in the filing, was $1.61 billion versus $1.49 billion in 2020.
Customer concentration is significant: T-Mobile, AT&T and Verizon Wireless represented 36.2%, 22.2% and 14.7% of 2021 total revenues. Total principal debt rose to $12.40 billionc from $11.18 billion, and shareholders' deficit was $(5.28) billion. Management noted that T-Mobile and Sprint consolidation is expected to cause churn of $140.0 million to $190.0 million of cash site leasing revenue over six years, and that Oi's Brazilian tower assets are being sold to other carriers, with about 1,568 of Oi's 7,525 leases overlapping with other providers.
During 2021 the company acquired the exclusive right to lease 713 utility transmission structures from PG&E for $972.0 milliond, and it closed 1,445 Tanzanian towers in January 2022 for $176.1 million. Management expects 2022 discretionary cash capital expenditures of $525.0 million to $545.0 million, and the Board declared a quarterly dividend of $0.71 per share on February 27, 2022, with $586.4 million remaining under the share repurchase authorization.
02—Key points
Key Highlights
- Total revenues of $2,308.8 million in 2021, up from $2,083.1 million in 2020; site leasing revenue was $2,104.1 million and site development revenue was $204.7 million.
- Net income of $237.6 million for 2021 versus $24.0 million in 2020, with operating income of $782.5 million versus $633.7 million.
- Site leasing contributed 97.4% of total segment operating profit in 2021, and the company owned 34,177 towers with an average of 1.8 tenants per tower structure.
- Customer concentration: T-Mobile (36.2%), AT&T Wireless (22.2%) and Verizon Wireless (14.7%) accounted for 2021 total revenues.
- Total principal debt of $12,396.0 million at December 31, 2021, up from $11,180.0 million, and a shareholders' deficit of $(5,283.4) million.
- Acquired exclusive rights to 713 PG&E utility transmission structures for $972.0 million in 2021 and closed 1,445 Tanzanian towers on January 4, 2022 for $176.1 million.
- Expected 2022 discretionary cash capital expenditures of $525.0 million to $545.0 million, and a $0.71 per share dividend declared February 27, 2022.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2021, Sba Communications kept $0.10.
- Revenue$2.31B100.0%
- Cost of revenue−$545.5M23.6%
- Gross profit$1.76B76.4%
- Operating costs−$980.9M42.5%
- Operating income$782.5M33.9%
- Interest, other & tax−$544.9M23.6%
- Net income$237.6M10.3%
Where FY2021 revenue went
$2.31B- Other operating costs: $760.8M, 33% of revenue
- Cost of revenue: $545.5M, 24% of revenue
- Interest, other & tax: $544.9M, 24% of revenue
- Net income: $237.6M, 10% of revenue
- SG&A: $220.0M, 9.5% of revenue
Kept 10% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2021filed March 1, 2022Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $2.31B$2.08B | +10.8% |
| Cost of Revenue | $545.48M$476.53M | +14.5% |
| Gross Profit | $1.76B$1.61B | +9.8% |
| SG&A Expenses | $220.03M$194.27M | +13.3% |
| Operating Expenses | $1.53B$1.45B | +5.3% |
| Operating Income | $782.50M$633.69M | +23.5% |
| Net Income | $237.62M$24.10M | +885.8% |
| EPS (Basic) | $2.17$0.22 | +886.4% |
| EPS (Diluted) | $2.14$0.21 | +919.0% |
| Shares Outstanding (Basic) | 109.33M111.53M | −2.0% |
| Shares Outstanding (Diluted) | 111.18M113.47M | −2.0% |
05—Questions
Frequently Asked Questions
How did SBAC's revenue and profitability change in 2021?
Total revenues increased to $2,308.8 million from $2,083.1 million, driven by domestic site leasing revenue growth of $123.1 million and site development revenue growth of $76.1 million. Net income rose to $237.6 million from $24.0 million, mainly reflecting higher operating income and foreign currency remeasurement effects described in the filing.
How concentrated is SBAC's customer base?
The company depends on a small number of customers. T-Mobile, AT&T Wireless and Verizon Wireless provided 36.2%, 22.2% and 14.7% of 2021 total revenues. In international site leasing, Oi S.A., Telefonica and Claro accounted for 28.3%, 16.3% and 13.7% of that segment's revenue.
What risks does the wireless consolidation pose to SBAC?
The filing states that T-Mobile's merger with Sprint is expected to cause churn of between $140.0 million and $190.0 million of cash site leasing revenue over the next six years. In Brazil, the sale of Oi's tower assets to other carriers may lead to non-renewal of approximately 1,568 overlapping leases out of 7,525 Oi leases.
How much debt does SBAC carry and when does it mature?
Total principal debt was $12,396.0 million at December 31, 2021, including $2.3 billion of 2018 Term Loan, $350.0 million drawn on the Revolving Credit Facility, $9.0 billion of Tower Securities, and $3.0 billion of senior notes. Scheduled principal payments are $24.0 million in 2022, $664.0 million in 2023, $644.0 million in 2024, $3,409.0 million in 2025 and $2,265.0 million in 2026.
What capital allocation and shareholder return actions did SBAC describe?
SBAC repurchased $582.6 million of stock in 2021 and paid $253.6 million in dividends. After year-end it repurchased 1.0 million shares for $350.0 million, leaving $586.4 million under the current repurchase authorization. The Board declared a $0.71 per share dividend on February 27, 2022.
06—Continue