8 Years with - American Tower

American Tower
Corporation
2015 Investor Day
December 10, 2015
Forward-Looking Statements
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: This
presentation contains forward-looking statements concerning our goals, beliefs, strategies,
future operating results and underlying assumptions. Actual results may differ materially from
those indicated by these forward-looking statements as a result of various important factors,
including those described at the end of this presentation, Item 1A of our Form 10-K for the year
ended December 31, 2014, as updated in our Form 10-Q for the quarter ended September 30,
2015, under the caption “Risk Factors” and other filings we make with the SEC. We undertake
no obligation to update the information contained in this presentation to reflect subsequently
occurring events or circumstances. Definitions are provided at the end of the presentation and
reconciliations to GAAP measures are available on our website at www.americantower.com.
2
Event Agenda
12:00pm-1:00pm
Lunch and Introduction with Jim Taiclet, CEO
1:00pm-1:45pm
Presentation and Q&A - India
1:45pm-2:00pm
Coffee Break
2:00pm-2:45pm
Presentation and Q&A – Latin America
2:45pm-3:30pm
Presentation and Q&A - EMEA
3:30pm-3:45pm
Coffee Break
3:45pm-4:30pm
Presentation and Q&A – U.S.
4:30pm-5:00pm
Closing Remarks with Tom Bartlett, CFO
5:00pm-6:30pm
Cocktail Reception in Lobby Lounge
3
American Tower Corporation
2015 Investor Day Introduction
Jim Taiclet, CEO
Our Growth Thesis is Predicated on Three Key Themes
2
1
›
The Global Mobile
Revolution is in Full
Swing and Will
Continue for a
Number of Years to
Come
›
Our Current
Quantitative Analysis
Suggests Macro
Towers Represent
the Best Opportunity
to Generate
Compelling Returns
3
›
International Markets
Will Grow Faster
than the U.S., for a
Longer Period of
Time
5
Theme 1: The Global Mobile Revolution
United States
›
International Markets
Total mobile data usage growing at ~50%
›
per year
›
networks
Average monthly mobile plan usage of
›
~3GB for smartphone users
›
Increasingly affordable smartphones are
only now penetrating the market
The internet of things is just scratching the
›
surface
›
Most consumers are still on 2G/3G
Demand for mobile technology just as
strong as in the U.S., if not higher
›
5G is coming!
4G is coming!
International Smartphone Penetration(1)
U.S. Smartphone Penetration
57%
16%
30%
<5%
2011
2012
2013
2014
2015E
2011
2012
2013
2014
2015E
95% of the World’s Population Resides Outside of the U.S. and Has a Growing Thirst for Mobile
(1)
Reflects average of Brazil, Mexico, India and Nigeria, weighted based on population size.
Sources: AV&Co. analysis & research, BofA Merrill Lynch Global Research, eMarketer, GSMA Intelligence
6
Theme 2: Macro Towers Remain the Focus of our Business
Macro Towers Offer the Best Opportunities
Best Source for Signal
Transmission in Most Areas
Preferred by Carriers
Proven Collocation
Opportunities
Limited Technology Risk
Minimal Maintenance Capex
Higher Expected Returns
7
Theme 2a: We Are Selectively Investing in Macro Tower
Supplements
Can we make
the collocation
model work?
What are the
upfront and
ongoing capital
costs?
What is the
technology
risk?
Can we earn a
sufficiently
attractive riskadjusted
return?
All Investment Decisions With Respect to Macro Supplements Are Predicated on Expected Returns
8
Theme 3: International Operations will Lengthen and
Strengthen our Growth Profile
Strong Customer Base
Less Mature Networks
›
›
›
~60% of revenue from
Predominantly young,
behind the U.S. in terms
upwardly mobile
Long-tenured, non-
of wireless technology
populations
CPI-linked escalators in
›
›
most markets
›
›
investment grade tenants
cancellable contracts
›
Most markets 5-10 years
Favorable Demographics
Carrier profitability
›
Predominantly 2G or 3G
›
Emerging middle classes
Extremely limited fixed
interested in mobile
line infrastructure
connectivity
Networks not dense
›
Rising incomes aligning
encourages incremental
enough to support
with decreasing handset
investment
3G/4G
prices
Networks
Today
Networks in
5-10 Yrs
9
Sources: AV&Co. analysis & research
Our Strategic Planning Framework
•
•
•
Focus on high-quality, well-located assets worldwide
Emphasize location, structural quality and lease-up potential
Utilize expanded asset base to build mutually beneficial relationships with carriers
Drive Superior
Operational
Execution to
Expand Margins
•
•
•
Hire the best people at all levels of the organization
Optimize processes and procedures and build best-in-class systems
Focus on driving highest possible margin flow-through of organic revenue growth
Maintain a
Strong Financial
Position to
Support
Inorganic Growth
•
•
•
Prudent financial policies to support investment grade rating
Substantial liquidity to support capital deployment
Disciplined asset evaluation processes
Attain Attractive
Levels of Scale
All Decisions Are Made to Create Long Term Shareholder Value
10
(1)
We Have Built a Leading Global Business
13
~3,300
~140,000
Countries
Global Employees
Towers(2)
With a Focused Commitment to:
›
›
›
›
(1)
(2)
Asset Quality
Partnering with Multi-National, High Quality Counterparties
Geographical Diversification
Creating Diverse Mix of Legacy and Newer Assets to Drive Growth
As of September 30, 2015.
Excludes DAS networks. Pro forma for Viom transaction. Tower count as of 9/30/15 of over 99,000.
11
We Have Hired the Best People Worldwide and
Empowered Them
World-Class Executive Team With Proven Track Record of Success
Tom Bartlett
Ed DiSanto
Hal Hess
Steven Marshall
Amit Sharma
6 Years with AMT
8 Years with AMT
14 Years with AMT
8 Years with AMT
8 Years with AMT
Executive Vice President
and Chief Financial Officer
Executive Vice President,
Chief Administrative
Officer, General Counsel
and Secretary
Executive Vice President,
International Operations &
President, Latin America
& EMEA
Executive Vice President
& President, U.S. Tower
Division
Executive Vice President
& President, Asia
Constant Focus on Continuous Improvement at All Levels in Organization
12
We Continue our Focus on Prudent Capital Deployment
Consistent, Proven Process
Extensive Standardized Market Evaluation
• Focus on large, free market democracies with stable macro
environments
• Seek large, growing wireless markets with multiple well-capitalized
and competitive carriers
Risk-Adjusted Return Hurdles for All Investments Account for:
• FX, inflation, country and counterparty risk
• Asset-specific considerations
10 Year DCF Model Used for All Investment Evaluations
• Extensive set of assumptions developed over 15 years
• Every investment compared against stock repurchase program
• Models include PPP Adjustments to compensate for long-term
international FX risk
13
We Have Maintained an Investment-Grade Balance Sheet
Balance Sheet Strength has Been a Key Component of our Expansion Initiatives
Average Maturity
(Years)
Cost of Debt(1)
4.8%
Key Considerations
›
5.6
Investment grade rated
since 2009
3.4%
›
4.4
Approximately $2 billion
of available liquidity
2011
2012
2013
2014
3Q15
Down ~140 basis points
Prudent Leverage Range
(1)
(2)
2011
2012
2013
2014
3Q15
›
(1)
Target Leverage
continues to be 3-5x(2)
Up ~1.2 years
Solid Liquidity
Laddered
Maturities
Increasing Local
Currency
Borrowing
3Q15 pro forma for the impact of amendment agreements effective October 28, 2015, which extended the maturity dates of the 2013 Credit Facility, the 2014 Credit
Facility and the Term Loan to June 28, 2019, January 29, 2021 and January 29, 2021, respectively.
Net leverage as of Q3 2015 was 5.4x, and we are targeting ~5x net leverage on a last quarter annualized basis by Q4 2016.
14
We are Now Positioned to Build on our Track Record
Current Positioning
›
›
›
›
›
›
Unmatched Global Portfolio of
~140,000 towers(1)
Exceptional Worldwide Talent Pool
Solid Balance Sheet and
Significant Liquidity
Significant Tower Capacity to Meet
Tenancy Demand
Long-tenured, Mutually Beneficial
Partnerships with Premier Global
Carriers
Global Acquisition Platform
Expected Results
›
›
›
›
›
Continued Solid Growth in
Revenue, Adjusted EBITDA and
AFFO per Share
Material Increase in Global
Tenancy Through Organic Growth
Significant Expansion of Existing
Asset ROIC, Led by International
Markets
Continued Evaluation of Inorganic
Growth Opportunities
Compelling Dividend Growth and
Total Stockholder Returns
We Expect Global Growth in Mobile to Fuel Exciting Growth for AMT
(1)
Pro forma for Viom transaction. Tower count as of 9/30/15 of over 99,000.
15
Definitions are provided at the end of this presentation.
Thank you
We Will now Begin Our Regional
Presentations with India
India Strategic Overview
Amit Sharma, President, Asia
The Foundations of Our Investments in India
Attractive
Macro
Backdrop
Rapidly
Growing
Wireless
Markets
Partnerships
with Large,
Well-Funded
Carriers
•
•
•
Legacy British rule of law
Solid property rights
One of the largest economies in the world
•
Multiple carriers investing in networks with recent and expected future
spectrum auctions
World’s second largest telecom market, in early stages of
development
Total mobile services market revenue expected to reach $37B by 2017
•
•
•
•
Bharti, Vodafone, Idea, Tata and others
Well positioned to capture significant market share in greenfield
Reliance-Jio launch
The Indian Market Satisfies Our Requirements for Capital Deployment
18
India Socioeconomic Trends
Large Population with
Increasing Economic
Mobility
›
›
›
›
World’s second largest
population, with nearly
1.3 billion people
Data-Hungry
Demographic
›
Median age of Indians
today is ~26 years
›
130 million moved above
poverty line between
2001-2011
›
~40% of population has at
least basic handsets
today(1)
Minimal fixed line
penetration means only
option for social apps,
texting, etc. is mobile
Mobile app usage is
growing by 100%+, driven
mostly by young people
~12% of population have
smartphones today;
~26% projected to have
smartphones by 2019(1)
Large Economy with Strong
Expected Growth
›
›
›
›
›
Seventh largest economy in
the world
Expected to be third-largest
by 2030
IMF expects GDP growth of
over 7% annually through at
least 2020
Significant emphasis on
modernization driven by
technological innovation
Digital India initiative
expected to help drive
growth in wireless sector
India is Poised to Modernize its Economy and Social Structure
Sources: AV&Co. analysis & research, Pew Research, July 2015, GFK, August 2015, Telecom Regulatory Authority of India, August 2015, BofA Merrill Lynch Global
19
Research, Cisco VNI 201
(1) Estimated based on current mobile penetration and current/future smartphone penetration, adjusting for average number of SIM cards per person (~1.84). Sources: AV&Co.
analysis & research, BAS-ML Global Research, Cisco VNI 2014 (India), The Broadband Commission for Digital Development- The State of Broadband 2015
India Technology Trends
Rapidly Falling Smartphone Prices(1)
Low Current Smartphone Penetration
300
90%
250
74% 74% 70% 70% 70%
55% 50%
43%
180
254
244
160
223
161
35% 30%
25% 20%
150
138
100
82
0
11
2011
6
2010
21
2012
›
›
›
(1)
Incumbents need to invest & compete to
maintain market share, particularly 4G
123
120
80
40
20
2014
2015E
2016E
2017E
2018E
Smartphone shipments (mn) - RHS
Mobile Data per User
(in petabytes)
(in megabytes)
1,262
13.7
149
1.1
2014
100
60
Total Data Traffic
Major carriers are well-positioned to deploy
new spectrum assets
R-Jio greenfield launch has generated
significant demand
120
Exponential Projected Mobile Data Usage Growth
$17B in proceeds. 900 MHz spectrum ideal
for efficient 3G and 4G deployments
140
0
2013
ASP of smartphone (US$)
›
126
127
107
132
50
50
Recent Spectrum Auctions Provide Critical Bandwidth
145
174
200
2019E
2014
2019E
ASP = Average Selling Price.
Sources: Cisco VNI 2014, BofA Merrill Lynch Global Research, Jana.com: Smartphone trends in India, Jan15, IDC, Strategy Analytics Group
20
Our India Presence (Pro Forma for Viom)
Portfolio Highlights
›
›
›
Legacy AMT
VIOM
›
›
A leading independent tower company in
India
Strategically positioned for incremental
tenancy opportunities with urban-centric
portfolio
Expect to facilitate extensive 3G/4G
network deployments for major carriers in
the market
Average tenancy of ~2.2 tenants per tower
Opportunity to achieve significant revenue
growth by meeting network needs of
incumbents
Diverse, Nationwide Footprint of ~57,000 Towers(1)
(1)
As of 9/30/15, pro forma for Viom transaction.
21
AMT’s History in India
Market Entry Follows Years of Due Diligence
2008
Enter market through 175site build-to-suit agreement
2009
Acquire ~2k towers from
Transcend and XCEL
2010
Acquire ~4.6k towers from
Essar
2012
Reach 10k tower mark
through active BTS program
2015
Announce ~42k site Viom
Transaction
High Quality
Partners
High Quality
Towers
Experienced
Local
Management
Teams
Operational and
Service
Excellence
22
India Leadership
Amit Sharma
•
•
•
EVP and President,
Asia
8 Years with
American Tower
Ashwani
Khillan
•
Chief Operating Officer
Vijay Agarwal
•
Chief Financial Officer
Sudhir
Agarwal
•
Chief Sales Officer
Nitin
Doddihal
•
VP, Business Development
Extensive
Background in
Global Telecom,
including at Motorola
Experienced Leadership Team Focused on Operational Excellence
23
23
India Operating Results(1)
Tower Count
Revenue
(in USD
Pass-through
revenue
~15k
Operating Profit
(in USD millions)
millions)(2)
$246
Tenant
revenue
$145
~2.6k
$22
2009
2009
$92
2010
2011
2012
2013
2014
Up Nearly 6X
2015E
2015
$15
2009
2009
$3
2010
2011
2012
2013
45% Tenant Revenue
CAGR
2014
2015E
2015
2009
2015
2009 2010 2011 2012 2013 2014 2015E
82% CAGR
Strong Organic Growth Complemented by New Builds and Acquisitions
(1)
(2)
2015 data reflects Q3 2015 ending tower count and annualized Q3 2015 revenue and operating profit.
Solid bar represents tenant revenue and dotted bar represents pass-through revenue contribution.
Definitions are provided at the end of this presentation.
24
India Revenue Overview(1)
Revenue by Tenant(1)
Other
18%
Signed New Business by Customer(2)
Aircel
8%
Other
14%
Bharti Airtel
9%
Uninor
9%
Vodafone
12%
Tata
30%
Idea
14%
Idea
32%
Aircel
10%
RelianceJio
10%
Vodafone
15%
Bharti Airtel
19%
Majority of Revenues and New Business Are from Large, Incumbent Wireless Carriers
(1)
(2)
Reflects Q3 2015 AMT India operating results, pro forma for Q2 2015 Viom operating results.
Reflects collocation and amendment activity for first nine months of 2015. Excludes BTS revenues.
25
India Growth History(1)(2)
Organic Growth
›
›
Acquisitions(4)
New Build Program
Driven primarily by new
business from large, wellfunded tenants
With increased rollout of
3G/4G, Organic Core
Growth has accelerated
over last twelve months
Organic Core Growth
›
›
›
Day 1 returns of 10%+
Tenancy on legacy new build
portfolio of ~2
›
composed of acquired sites
›
tenants(3)
Most builds for large carriers
like Airtel and Vodafone
>80% of pro forma portfolio
Acquired portfolios have
typically performed at or
above initial expectations
Acquired Sites per Year
New Builds per Year
~42,600
~2,000
1,602
1,257
1,548
Average of over 9%
2012
2013
2014
2015E
2012
2013
2014
2015E
~6,600
-
Pre-2010
2010-2014
YTD 2015
All Investments Evaluated Using Risk Adjusted, DCF-Based Analysis
(1)
(2)
(3)
(4)
2014 and 2015 Organic Core Growth excludes the impact of pass-through revenues.
2015 Organic Core Growth is year-to-date organic core growth as of the quarter ended September 30, 2015.
For sites constructed in 2010 and earlier.
Includes Viom transaction announced on October 21, 2015. Transaction expected to close in mid-2016.
26
Definitions are provided at the end of this presentation.
Key Transaction – Essar
Transaction Overview
›
›
›
Current Operating Performance
~4,600 towers in August 2010 for
~$430 million
~1.9 tenants per tower on day
one
Day 1 gross margin % of ~75%(1)
›
›
›
Tenancy of 2.3 tenants per tower
Gross margin % of ~85%(1)
NOI Yield of ~11%
Tenant Revenue(2)
Tenancy Per Tower
NOI Yield(3)
(INR in millions)
3,400
11%
2.3
3,250
2.2
9%
10%
2013
2014
2.2
3,100
2013
2014
2015
2013
2014
2015
2015
Proven History of Driving Increasing Yields on Acquired Portfolios
(1) Excludes pass-through
(2) 2015 based on annualizing results from the quarter ended 9/30/15. All years exclude straight-line revenue.
(3) 2015 based on Q3 2015 annualized data. NOI yield reflects local currency.
Definitions are provided at the end of this presentation.
27
India New Build Program – Overview(1)
New Build Program Highlights
›
›
›
›
›
Key driver of growth in India, with favorable economics
More than half of current portfolio comprised of AMT builds
Current average construction cost between $25k-$30k USD
Day 1 Returns of 10%+, much higher with additional tenants
Anchor tenants are typically large incumbent carriers
Operating Highlights for 2010 and Prior New Builds
Average Tenancy
1.7
2013
(1)
(2)
1.9
Average Annual Tenant
Revenue per Tower(2)
2.0
(INR in thousands)
550
2014
2015
2013
610
21%
670
18%
14%
2014
2015
As of the quarter ended 9/30/15.
2015 based on Q3 2015 annualized data. All periods exclude straight-line revenue. NOI yield reflects local currency.
Definitions are provided at the end of this presentation.
NOI Yield(2)
2013
2014
2015
28
India New Build Program – Overview
New Build Program Highlights
›
›
›
›
Innovative products with reduced time to market - NPP (Non-Penetrating Pole) reduced
to 3 from 7 days, QBS (Quick Build Solution) reduced to 18 days from 40 days
Lighter towers to bring in cost optimization – NBT (Narrow Base Tower), reduces capex
up to 12-15% of overall site cost
Implementation of Standard Quality Assurance & Quality Control processes, ensuring
quality construction
Provision of Fiber ducts – to support OFC requirement of Carriers for 3G/4G. Results in
additional revenue & marketability of towers
QBS – Steel Foundation
6.0m NPP with Camouflage
GBM with Street Lights
Camouflaged GBM
Abbreviations: QBS = Quick Build Solution NPP = Non-penetrating Pole GBM = Ground Based Mast OFC = Optical Fiber Cable
29
American Tower’s Competitive Advantage in India
Presence
›
›
›
›
People
Leading, well-positioned
independent portfolio in
India(1)
Proven history of driving
lease-up on both
constructed and acquired
sites
Significant presence in
urban areas seeing more
activity due to 3G/4G
rollouts and coverage gaps
›
›
›
›
Able to leverage portfolio
and existing relationships
with key tenants
Operational Efficiency
Veteran leadership team in
place from day one
Strong regional organization
of nearly 450 employees
Will be focused on
seamlessly integrating Viom
portfolio once transaction is
closed
Expect to decrease SG&A
as % of revenue after
closing Viom transaction
›
›
›
›
Industry-leading systems and
processes developed over 15
years of international
operations
Efficient site uptime
performance makes portfolio
more attractive for collocation
Focus on renewable energy
helped us move ~4,500
towers to zero diesel mode
Mobile based workforce
management for efficiency in
operations and billing
SG&A as % of Revenue(2)
Site Uptime %(2)
99.9%
A Circle
Locations
9%
8%
8%
9%
99.8%
99.8%
99.7%
Metros
Rural and
Suburban
(1)
(2)
Pro forma for pending Viom transaction.
Figures represent annual averages except for 2015 which is YTD 2015.
2012
2013
2014
YTD 2015
2012
2013
2014
30
YTD 2015
Key Opportunities
1
Viom Assets are Well-Positioned to Drive Revenue Growth and Yield
Operating Synergies
2
Capitalize on Carrier Network Investments as Multi-Year Deployments
of 3G and 4G accelerate
3
Evaluate Macro Supplements (WiFi, DAS, Small cells, limited
backhaul)
4
Evaluate Other Potential Opportunities in Asia
We Are Focused on Generating Recurring, Long-Term Growth in India
31
India Q&A
India Appendix
Supplementary India Data(1)
(1)
(2)
Country
Years
Operating
in Market
Avg
Tenancy
Avg Years in
AMT
Portfolio
% of AMT
Rental
Revenue
# of Towers
# of DAS
Systems
India
8
1.9
4.7 years
5.1%
14,618
25
As of the quarter ended 9/30/15.
Based on year-to-date annualized figures as of 9/30/15.
Definitions are provided at the end of this presentation.
Country
3 Yr Avg
Organic
Core
Growth
Consolidated
ROIC(2)
India
9.0%
8.2%
34
India Tower Vintage Analysis(1)(2)
% of Portfolio By Ownership Length
Tenancy
2.2
50%
2.0
1.5
33%
17%
>5 Years
3-5 Years
<3 Years
>5 years
3-5 years
NOI Yield(3)(4)
Tenant Revenue per Tower Ex Straight-line(3)
(INR ‘000)
22%
750
17%
613
443
>5 years
(1)
(2)
(3)
(4)
3-5 years
<3 years
<3 years
12%
>5 years
3-5 years
Reflects average years in AMT portfolio, as of 9/30/15. Vintage reflects years in AMT portfolio.
Definitions are provided at the end of this presentation.
As of the quarter ended 9/30/15.
2015 based on Q3 2015 annualized data and. NOI yield reflects local currency.
Younger vintage have highest NOI yield due to highest proportion of built sites, which have a lower initial investment than acquired sites.
<3 years
35
LatAm Strategic Overview
Hal Hess, EVP and President, Latin America and EMEA
Olivier Puech, CEO Latin America
The Foundations of Our Investments in LatAm
Attractive
Macro
Backdrop
• Legacy European rules of law
• Solid property rights throughout footprint
• Large, growing economies
Competitive
Wireless
Markets
• Multiple carriers investing in networks
• Recent and future spectrum auctions
• Significant growth in mobile data usage and smartphones
Partnerships
with Large,
Multinational
Carriers
• AT&T, Telefónica, América Móvil, Telecom Italia and others
Our Latin American Markets Fit our Comprehensive Investment Evaluation Methodology
37
LatAm Socioeconomic Trends(1)
Young, Increasingly
Connected Middle Class
›
›
›
›
Middle class population of
~200 million
Significant portion under
the age of 40
More than half use social
media
Data consumption among
this demographic
increasingly driven by
video
Increasing Focus on
Digitalization
›
›
›
Digitalization in LatAm
has generated nearly 1
million jobs and 4.3% to
regional GDP
Even so, more than 40%
of people in region still
don’t have internet
access
Solid Economic Outlook
Despite Near Term
Headwinds
›
›
3.8%
Near term economic
volatility expected to ease
over time
FX trends currently ~2-3
standard deviations
outside historical range
Projected GDP Growth (2)
3.6%
Local governments
implementing numerous
digitalization programs
2013 2014 2015 2016 2017 2018 2019 2020
Latin America Is Positioned for Strong Long-Term Growth
(1) Reflects AMT’s Latin American markets.
(2) Reflects average of AMT’s Latin American markets, on a constant price basis.
Sources: Brookings Institute, February 2015, GSMA intelligence, May 2015, Development Bank of Latin America, July 2015, Kharas, OCED, 2010 , GSMA Mobile
Economy, Latin America 2014, WEO IMP, April 2015, IMF World Economic Outlook.
38
LatAm Technology Trends
Mix of Connections Rapidly Shifting to 3G/4G(1)
% of Connections by Technology
Rapidly Falling Smartphone Prices(2)
Xiaomi Redmi 2
BLU Dash JR K
~$150
~$50
4G
4G
3G
3G
2G
2G
2014
2019E
3G/4G expected to be ~80% by 2019
Mobile Data Traffic Expected to Grow Exponentially(3)
LatAm Mobile Data Traffic
Very High # of Subscribers Per Cell Site in Major Markets(4)
(in thousands)
1,131
4.3
(in petabytes/month)
4.2
3.1
1.6
90
2013
(1)
(2)
(3)
(4)
2014
2015E
2016E
2017E
2018E
Mexico
Brazil
AV&Co. research
AV&Co. research – online prices in Brazil, converted from Brazilian Reals to U.S. Dollars
GSMA Mobile Economy, Latin America, 2014
AV&Co. estimate of the number of subs per unique site location (e.g. towers) in a country based on GSMA Intelligence and CTIA Annual Wireless Industry Survey
Colombia
U.S.
39
Our LatAm Presence(1)
Mexico
~8,800 sites
Latin American Portfolio
Colombia
~3,700 sites
›
Costa Rica
~500 sites
›
›
Peru
~600 sites
Chile
~1,200 sites
›
Brazil
~17,700 sites
›
›
(1)
As of September 30, 2015.
More than 32,000 towers and
approximately 100 DAS systems
#1 or #2 independent tower
operator in all six markets where
we operate
Key regional customers include
AT&T, Telefónica and América
Móvil
Existing average tenancy of ~1.5
tenants per tower
Strong organic growth with select
opportunities for additional
portfolio expansion
Especially strong presence in key
markets like Mexico and Brazil
40
AMT’s History in LatAm
Market Entries Follow Years of Due Diligence
1999
2000
2010
2011/12
2013
2014/15
Enter Mexico and Brazil through
small acquisitions and BTS
programs
High Quality
Partners
Enter Colombia, Chile and Peru by
Acquiring ~1,600 TEF towers
Acquire ~2,400 TEF towers in
Mexico; Acquired ~2,400 towers
from VIVO and Sitesharing in Brazil
Acquire NII Mexico & Brazil tower
portfolios and Axtel towers in
Mexico
BR Towers and TIM Brazil
transactions
An Industry
Leader
Experienced Local
Management
Teams
Focus on
Operational and
Service
Excellence
41
LatAm Leadership
Hal Hess
•
EVP and President,
Latam and EMEA
•
14 Years with
American Tower
•
Extensive
Background in
Global Tower
Business
Olivier Puech
•
CEO, LatAm
Katherine
Motlagh
•
CFO, LatAm and EMEA
Guillermo
Cordera
•
Director General, Mexico
Flavio
Cardoso
•
Director General, Brazil
Alejandro
Messmacher
•
SVP Finance, LatAm
Experienced Leadership Team Focused on Operational Excellence
42
42
LatAm Operating Results(1)
Revenue(2)
(in USD millions)
Tower Count
~32,000
Pass-through
revenue
Tenant
revenue
Operating Profit
(in USD millions)
$875
$517
$630
$140
$188
~3,200
$146
2007 2008
2007
2009 2010 2011 2012 2013 2014 2015
2015E
Up 10x
2007 2008
2007
2009 2010 2011 2012 2013 2014 2015
2015E
20% Tenant Revenue
CAGR
2007
2015
18% CAGR
Profitable Organic Growth Complemented by New Builds and Acquisitions
(1)
(2)
2015 data reflects Q3 2015 ending tower count and annualized Q3 2015 revenue and operating profit.
Solid bar represents tenant revenue and dotted bar represents pass-through revenue contribution.
Definitions are provided at the end of this presentation.
43
LatAm Revenue Overview
Revenue by Country(1)
Other
7%
Colombia
8%
Other
15%
Brazil
48%
Mexico
37%
Revenue by Tenant(1)
América
Móvil
7%
Oi
9%
Nextel
Brazil
11%
Telefónica
23%
TIM
13%
AT&T
22%
Signed New Business by Customer(2)
América
Móvil
11%
Other
28%
TIM
14%
AT&T
28%
Telefónica
19%
More than Half of Regional Revenues from Investment-Grade Tenants
(1)
(2)
Reflects Q3 2015.
Reflects collocation and amendment activity for first nine months of 2015. Excludes BTS revenues.
44
LatAm Growth History
Organic Growth
›
New Build Program
Incremental Margins of
›
High single digit % day one
returns from the anchor
tenant with the ability to
expand returns with future
collocations
90%+ on organic revenue
growth
›
Significant base of young
assets expected to drive
long-term organic core
›
›
>80% of regional portfolio
composed of acquired sites
›
Acquired portfolios have
typically performed at or
above initial expectations in
Focus on quality
counterparties such as
Telefónica and AT&T
growth
Organic Core Growth(1)
Acquisitions
New Builds per Year
local currency terms
Acquired Sites per Year
~900
5,519
5,050
5,310
2013
2014
YTD 2015
722
370
507
2,504
Average of ~13%
2012
2013
2014
2015 (2)
2012
2013
2014
2015E
2012
All Investments Evaluated Using Risk Adjusted, DCF-Based Analysis
(1)
(2)
2014 and 2015 organic core growth excludes the impact of pass-through revenues.
2015 Organic Core Growth is year-to-date organic core growth as of the quarter ended September 30, 2015.
Definitions are provided at the end of this presentation.
45
Key Transaction #1 – Site Sharing(1)
Transaction Overview
›
›
›
Current Operating Performance
›
›
~700 towers in Brazil in 2011
13.4x day-1 tower cash flow multiple,
implying a 7.5% NOI yield
1.7 tenants per tower on day 1
Tenancy
2.1
2.2
›
Current tenancy of 2.2 tenants per site
YTD 2015 portfolio organic core
growth of ~9%
NOI yield nearly 11%
Tenant Revenue per Site Ex
Straight-line(2)
(BRL in 000s)
11%
162
132
1.7
NOI Yield(2)
9%
7%
109
Day 1
(1)
(2)
2013
2015
Day 1
2013
As of the quarter ended 9/30/15.
2015 reflects annualized YTD 2015 results as of 9/30/15. NOI yield reflects local currency.
Definitions are provided at the end of this presentation.
2015
Day 1
2013
2015
46
Key Transaction #2 – Telefonica Mexico(1)
Transaction Overview
›
›
›
Current Operating Performance
›
~2,600 towers acquired from
Telefonica with the first closing
occurring in 2011
Initial tenancy of 1.0 per tower
21.4x day 1 tower cash flow multiple
Tenancy
1.2
1.3
›
›
Tenant Revenue per Site Ex
Straight-line(2)
230
(MXN in 000s)
1.0
(1)
(2)
NOI Yield(2)
8%
172
6%
143
Day 1
Current tenancy of 1.3 tenants per
tower
8% Core Organic growth YTD in 2015
despite a slow environment in Mexico
over the past two years
NOI yield now over 8%
2013
2015
Day 1
5%
2013
As of the quarter ended 9/30/15.
2015 reflects annualized YTD 2015 results as of 9/30/15. NOI yield reflects local currency.
2015
Day 1
2013
2015
47
American Tower’s LatAm Competitive Advantage
Presence
›
›
›
People
Most extensive regional
footprint in LatAm
A leader in key strategic
markets
Long-tenured
relationships with major
carriers in region
# of Latam Towers(1)
(000’s)
›
›
›
Veteran LatAm leadership
team with extensive
industry experience
Robust regional
organization of more than
700 employees
Expect to primarily utilize
existing SG&A base for
future expansion,
including M&A integration
›
›
Average tenancy of just
~1.5
Have owned majority of
LatAm sites for <3 years
Compelling opportunity to
drive lease-up on
previously under-utilized,
under-marketed assets
Site Ownership Length(1)
56%
10%
11
(1)
›
SG&A as % of Revenue
32
AMT
Young Portfolio
Telesites
As of September 30, 2015.
9
SBAC
11%
9%
Grupo
Torresur
29%
7%
6
15%
2012
2013
2014
3Q15
>5 yrs
3-5 yrs
<3 yrs
48
Key Opportunities
1
Dynamic Mexican & Brazilian Mobile Markets
Poised to Produce Significant Growth
2
Mobile Internet Still in Early Stages
3
Tremendous Need for Denser, Stronger Networks
We Are Focused on Generating Recurring, Long-Term Growth in Latin America
49
LatAm Q&A
LatAm Appendix
Supplementary LatAm Data(1)
(1)
(2)
Country
Years
Operating
in Market
Avg
Tenancy
Avg Years in
AMT
Portfolio
% of AMT
Rental
Revenue
# of Towers
# of DAS
Systems
Mexico
15
1.5
5.6
6.7%
8,733
44
Brazil
14
1.4
2.1
8.6%
17,699
47
Colombia
5
1.6
3.9
1.5%
3,676
1
Other LatAm
2-5
1.5
4.1
1.2%
2,224
6
Reflects data as of September 30, 2015.
Based on year-to-date annualized figures as of 9/30/15.
Definitions are provided at the end of this presentation.
Country
3 Yr Avg
Organic
Core
Growth
Consolidated
ROIC(2)
Mexico
8.9%
14.3%
Brazil
12.0%
9.0%
Colombia
25.1%
5.4%
Other LatAm
14.2%
7.4%
52
Mexico Tower Vintage Analysis(1)
Tenancy(2)
% of Assets by Vintage
72%
2.1
2.0
1.1
20%
8%
>10 Years
5-10 Years
<5 Years
>10 years
37%
809
<5 years
NOI Yield(3)
Tenant Revenue per Tower Ex Straight-line(3)
(MXP ‘000)
5-10 years
35%
624
268
>10 years
5-10 years
<5 years
(1) As of the quarter ended 9/30/15. Vintage reflects years in AMT portfolio.
(2) Tenancy reflects legacy Iusacell and Nextel Mexico equipment installations as one tenant per site.
(3) 2015 based on Q3 2015 annualized data. NOI yield reflects local currency.
Definitions are provided at the end of this presentation.
12%
>10 years
5-10 years
<5 years
53
Brazil Tower Vintage Analysis(1)
% of Assets by Vintage
Tenancy
91%
2.8
1.9
1.2
3%
>10 Years
6%
5-10 Years
<5 Years
>10 years
Tenant Revenue per Tower Ex Straight-line(2)
234
5-10 years
<5 years
NOI Yield(2)
(BRL ‘000)
50%
32%
100
38
>10 years
(1)
(2)
5-10 years
<5 years
As of the quarter ended 9/30/15. Vintage reflects years in AMT portfolio.
2015 based on Q3 2015 annualized data. NOI yield reflects local currency.
Definitions are provided at the end of this presentation.
7%
>10 years
5-10 years
<5 years
54
EMEA Strategic Overview
Hal Hess, EVP and President, Latin America and
EMEA
Stephen Harris, SVP and CEO, EMEA
The Foundations of Our Investments in EMEA
Attractive
Macro
Backdrop
• Legacy European rules of law
• Solid property rights throughout footprint
• Large, growing economies
Competitive
Wireless
Markets
• Multiple carriers investing in networks
• Recent and future spectrum auctions
• Significant growth in mobile usage and penetration
Partnerships
with Large,
Multinational
Carriers
• Bharti, Vodafone, MTN, Telefónica and others
Our EMEA Presence Is Predicated on Our Disciplined Investment Evaluation Methodology
56
Africa Socioeconomic Trends(1)
Young, Increasingly
Connected Middle Class
›
›
›
Total population of ~300
million
~60% of population under
the age of 25
Strong Incentives for
Continued Wireless
Network Development
›
›
Mobile is absolutely
critical for daily life
•
•
•
•
Basic communication
Banking
Social media
Entertainment
›
Fixed-line penetration
virtually non-existent in
most African markets
Economic development of
region can be accelerated
through use of mobile
technologies
Governments have
prioritized mobile
development as key goal
in numerous initiatives
Solid Economic Outlook
›
›
›
Historically
underdeveloped markets
Foreign direct investment
accelerating
Stable expected growth
Projected GDP Growth(2)
4.7%
4.4%
2013 2014 2015 2016 2017 2018 2019 2020
EMEA Is Positioned for Strong Long-Term Growth
(1)
(2)
Reflects Nigeria, South Africa, Ghana and Uganda.
Reflects average of Nigeria, South Africa, Ghana and Uganda, on a constant price basis.
Sources: Brookings Institute, February 2015, CIA World Factbook, African Economic Outlook Report, 2015, IMF World Economic Outlook, October 2015
57
Africa Technology Trends(1)
Mix of Connections Expected to Shift to 3G/4G(2)
Wireless Penetration Still Relatively Low
% of Connections by Technology
87%
73%
66%
63%
4G
3G
59%
45%
43%
38%
4G
3G
36%
2G
2G
South Morocco Ghana
Africa
Egypt
Algeria Nigeria
2014
Kenya Uganda Tanzania
2019E
3G/4G expected to be ~70% by 2020
AMT Markets
Smartphone Penetration Expected to Rise Quickly(3)
Wireless Capex Trends Are Solid(4)
Projected Smartphone Penetration
Projected Wireless Capex Spending $14
(In $billions)
41%
$8
13%
2014
2015
2016
2017
2018
2019
2012 2013 2014 2015 2016 2017 2018 2019 2020
(1)
Sources: AV&Co. analysis & research, GSMA Intelligence, Broadband Commission for Digital Development- The State of Broadband 2015
For Africa only; Sources: AV&Co. analysis & research, Cisco VNI (2014-2019, Middle East & Africa)
(3) For Africa only; Sources: AV&Co. analysis & research, Cisco VNI (MEA)
(4) For Sub-Saharan Africa (excludes N. Africa). Sources: AV&Co. analysis & research, GSMA Mobile Economy Sub-Saharan Africa October 2015
(2)
58
Our EMEA Presence(1)
Germany
~2,000 sites
EMEA Portfolio
›
›
›
›
Ghana
~2,100 sites
Uganda
~1,400 sites
›
›
Nigeria
~4,700 sites
(1)
As of September 30, 2015.
More than 12,000 towers
#1 or #2 independent tower
operator in each of our chosen
markets
Key regional customers include
Airtel, MTN and Vodafone
Existing average tenancy of ~1.5
tenants per tower
Strong Organic Growth with
meaningful opportunities for
additional portfolio expansion
Positions in key African markets
and a strategic European base in
Germany
South Africa
~1,900 sites
59
AMT’s History in EMEA
Market Entries Follow Years of Due Diligence
2010
Enter Ghana through JV with
MTN
2010
Establish 75% stake in Cell C
Portfolio in South Africa
2012
Acquire KPN towers in Germany
2012
Enter Uganda through JV with
MTN
2015
Enter Nigeria through
acquisition of Airtel towers
High Quality
Partners
High Quality
Towers
Experienced
Management Teams
Focus on
Operational
Excellence
60
EMEA Leadership
Hal Hess
•
EVP and President,
Latam and EMEA
•
14 Years with
American Tower
•
Stephen
Harris
•
CEO, EMEA
Katherine
Motlagh
•
CFO, LatAm and EMEA
Pieter Nel
•
COO, EMEA
Extensive
Background in
Global Tower
Business
Experienced Leadership Team Focused on Operational Excellence
61
EMEA Operating Results(1)
Revenue(2)
(in USD millions)
Tower Count
Operating Profit
(in USD millions)
$498
~12,100
Pass-through
revenue
$216
Tenant
revenue
$371
~3,200
$85
$21
$58
2007
2011
2008
2009
2010
2011
2015
Up Nearly 4x
2011
2011
2008
2009
2010
60% Tenant Revenue
CAGR
Q315
2015
2011
2011
2012
2013
2014
80% CAGR
Profitable Organic Growth Complemented by New Builds and Acquisitions
(1)
(2)
2015 data reflects Q3 2015 ending tower count and annualized Q3 2015 revenue and operating profit.
Solid bar represents tenant revenue and dotted bar represents pass-through revenue contribution.
Definitions are provided at the end of this presentation.
62
2015E
2015
EMEA Revenue Overview
Revenue by Country(1)
Revenue by Tenant(1)
Other
7%
Uganda
10%
Vodafone
7%
South
Africa
16%
Millicom
5%
DFMG
5%
Telefonica
8%
Germany
11%
Nigeria
44%
Signed New Business by Customer(2)
Cell C
9%
Other
22%
Vodafone
11%
Airtel
41%
Ghana
17%
MTN
28%
MTN
25%
Airtel
33%
More than 80% of Regional Revenues from Investment-Grade Tenants
(1)
(2)
Reflects Q3 2015.
Reflects collocation and amendment activity for first nine months of 2015. Excludes BTS revenues.
63
EMEA Growth History(1)(2)
Organic Growth
›
Driven primarily by new
New Build Program
›
Double digit % day one
returns from anchor tenant
with materially higher
returns after collocations
business from large
multinational tenants
›
Incremental margins of
90%+ on organic revenue
›
›
>90% of regional portfolio
composed of acquired sites
›
Acquired portfolios have
typically performed at or
Focus on quality
counterparties such as
MTN, Airtel and Vodafone
growth
Organic Core Growth
Acquisitions
New Builds Per Year
227
~200
171
137
above initial expectations in
local currency terms
Acquired Sites Per Year
~4,700
~3,200
Average of ~16%
2012
2013
2014
YTD 2015
2012
2013
2014
2015E
2012
252
19
2013
2014
YTD 2015
All Investments Evaluated Using Risk Adjusted, DCF-Based Analysis
(1)
(2)
2014 and 2015 Organic Core Growth excludes the impact of pass-through revenues.
2015 Organic Core Growth is year-to-date Organic Core Growth as of the quarter ended September 30, 2015.
Definitions are provided at the end of this presentation.
64
South Africa Operating History(1)
Transaction Overview
›
›
›
›
Current Operating Performance
~1,800 towers purchased from Cell C
and ~100 towers built subsequently
for several carriers
2.5bn ZAR invested since inception
5.7x day-1 tower cash flow multiple,
implying an NOI yield of ~18%
1.5 tenants per site at closing
Tenancies per Site
1.8
1.9
›
›
›
Current tenancy of 1.9 tenants per site
10% Organic Core growth for YTD
2015 vs. the same period in 2014
NOI yield now ~29%
Tenant Revenue per Site Ex
Straight-line(2)
(ZAR in 000s)
1.5
NOI Yield(2)
495
381
29%
22%
18%
276
Day 1
(1)
2013
2015
Day 1
2015 reflects annualized YTD 2015 results as of 9/30/15.
(1) As of the quarter ended 9/30/15.
(2) 2015 based on Q3 2015 annualized data. NOI yield reflects local currency.
Definitions are provided at the end of this presentation.
2013
2015
Day 1
2013
2015
65
Ghana Operating History(1)
Transaction Overview
›
›
›
Current Operating Performance
~1,900 towers purchased from MTN
in 2011 as part of JV and
approximately 200 built subsequent
to the initial acquisition
Approximately 950M GHS invested
since inception
12.8x Day 1 tower cash flow multiple,
implying an NOI yield of 7.8%
Tenancies per Site
1.5
1.6
›
›
›
Current tenancy of 1.6 tenants per
tower
22% Core Organic growth excluding
pass thru for YTD 2015 vs. the same
period in 2014
NOI yield now ~19%
Tenant Revenue per Site Ex
Straight-line(2)
112
NOI Yield(2)
19%
(GHS in 000s)
12%
66
1.0
8%
39
Day 1
(1)
(2)
2013
2015
Day 1
As of the quarter ended 9/30/15.
2015 based on Q3 2015 annualized data. NOI yield reflects local currency.
Definitions are provided at the end of this presentation.
2013
2015
Day 1
2013
2015
66
American Tower’s EMEA Competitive Advantage
Presence
›
›
›
People
›
Unique footprint in key
Sub-Saharan African
markets and anchor
market in Europe
›
#1 or #2 tower operator in
every EMEA market we
operate in
Able to leverage portfolio
and existing relationships
with key tenants
›
Operational Efficiency
Veteran EMEA leadership
team in place from day
one
Robust regional
organization of more than
500 employees
Able to substantially
leverage existing SG&A
base for future expansion,
including M&A integration
# of EMEA Towers(1)
21
(000’s)
SG&A as % of Revenue
17%
15
12
7
AMT
(1)
IHS
Cellnex
Eaton
14%
14%
2013
2014
11%
5
Helios
2012
›
›
›
Leading systems and
processes developed
over 15 years of
international operations
Efficient fuel management
and site uptime
performance makes
portfolio more attractive
for collocation
Fuel management
programs focus on
reducing fuel
consumption, improving
site uptime, and reducing
costs, for both AMT and
the operator
3Q15
As of 9/30/15.
67
Key Opportunities
1
Mobile is in Extremely Early Stages in Most of Africa, with Huge Potential for
Future Development
2
Recent and Upcoming Spectrum Auctions are Expected to Catalyze
Incremental Investments
3
Regional Scale and Strong Carrier Relationships Expected to Drive Strong
Growth in Profitability
We Are Focused on Generating Recurring, Long-Term Growth in EMEA
68
EMEA Q&A
EMEA Appendix
Supplementary EMEA Data(1)
Country
Years
Operating
in Market
Avg
Tenancy
Avg Years in
AMT
Portfolio
% of AMT
Rental
Revenue
# of Towers
# of DAS
Systems
South Africa
4.8
1.9
4
1.8%
1,917
-
Nigeria
<1
1.2
<1
4.5%
4,700
-
Germany
3
1.8
3
1.1%
2,030
-
Ghana/Uganda
4.5 and 3.5
1.5
3.5
2.8%
3,472
14
Country
3 Yr Avg
Organic
Core
Growth
Consolidated
ROIC(3)
South Africa
14.4%
23.8%
Nigeria
N/A
6.2%
Germany(2)
4.0%
8.4%
Ghana/Uganda(2)
20.5%
10.6%
(1) Reflects data for quarter ended September 30, 2015.
(2) 2 year average due to more limited operating history.
(3) Based on year-to-date annualized figures as of 9/30/15.
Definitions are provided at the end of this presentation.
71
South Africa Tower Vintage Analysis(1)
% of Assets by Vintage
Tenancy
81%
2.0
1.2
19%
3-5 Years
<3 Years
3-5 Years
Tenant Revenue per Tower Ex Straight-line(2)
<3 Years
NOI Yield(2)
(ZAR ‘000)
31%
536
276
9%
3-5 Years
(1)
(2)
<3 Years
As of the quarter ended 9/30/15. Vintage reflects years in AMT portfolio.
2015 based on Q3 2015 annualized data. NOI yield reflects local currency.
Definitions are provided at the end of this presentation.
3-5 Years
<3 Years
72
U.S. Strategic Overview
Steven Marshall, EVP and President, United States
Rod Smith, SVP and CFO, United States
The Foundations of our Investments in the U.S.
Attractive
Macro
Backdrop
• Largest economy in the world
• Constructive legal, property rights and regulatory framework
• Good, stable, long-term growth prospects
Competitive
Wireless
Market
• Multiple carriers investing in networks
• Recent and future spectrum auctions
• Significant growth in mobile data usage and smartphones
Partnerships
with Large,
National
Carriers
• AT&T, Verizon Wireless, T-Mobile and Sprint
Our Home U.S. Market Fits Squarely Within Our Investment Requirements
74
Key U.S. Demand Driver: Mobile Data
Average Data Used by Activity
(in megabytes)
13,800x
276
400x
500x
150x
3
10
8
3 minute
song
3 minute video clip
30 minutes Internet
browsing
0.02
Sending an email
30 minute
TV show
More Advanced Devices = Access to More Advanced Applications
Note: 1 MB equals 1024 KB
Sources: Altman Vilandrie & Co. research, Verizon, AT&T
75
Key U.S. Demand Driver: Mobile Data (Continued)
U.S. Data Traffic by Device Type
(1)
(in exabytes)
43.4
2.2
2012
2013
Feature Phones
2014
2015E
Smartphones
2016E
Computing Devices
2017E
(2)
2018E
M2M
2019E
Wearables
More Advanced Applications = More Mobile Data Consumption
= Incremental Demand for Towers
(1)
(2)
1 exabyte is equivalent to 1 billion gigabytes.
Computing devices represent tablets and laptops.
Sources: Altman Vilandrie & Co. analysis integrating multiple sources (eMarketer, BIA/Kelsey, CTIA, Yankee Group/451 Research, Cisco VNI, Frost & Sullivan, company 10Ks)
76
Our U.S. Presence(1)
(1)
(2)
~3.2B(1)
77%(1)
~40K
328
Total Revenue
Gross Margin
Sites
DAS sites
~2.2
1,300+
56%
Tenants per Tower
Employees
In Top 100 BTA
Reflects 2015 outlook midpoints, as reported in the Company’s Form 8-K, dated October 29, 2015 and/or metrics as of 9/30/15.
Invested Capital 2012 to 9/30/15
77
U.S. Leadership
Steven Marshall
•
EVP and President,
US Tower Division
•
8 Years with
American Tower
•
Prior to joining AMT,
CEO, National Grid
Wireless
Rodney
Smith
•
SVP & CFO
Steve
Vondran
•
SVP & General Counsel
Bud
Noel
•
SVP Engineering & Operations
Phillip
Rosenthall
•
SVP Sales & Marketing
Gerard
Ainsztein
•
SVP Managed Networks
Experienced Team Focused on Accretive Investments & Operational and Service Excellence
78
U.S. Strategic Overview
Contract Negotiations
›
›
›
Disciplined approach to customer contracts
Capital Deployment 2012-2015
›
Mutually beneficial long-term master lease
agreements
Increase growth visibility and minimize churn
M&A Transactions
›
Acquired Global Tower Partners
›
Acquired rights to Verizon Tower Portfolio
›
(1)
Active program in place to continue evaluating
additional asset portfolios
Includes the acquisition of rights to ~11,500-tower Verizon portfolio.
Invested total of ~$12.4B
›
Acquired over 17,000 towers(1) and constructed ~1,200
›
Deployed over 3,000 shared generators
›
Built 70+ DAS and small cell networks
›
Acquired more than 3,000 ground leases
People and Systems
›
›
Enhanced systems and processes, including
HR, IT and Operational systems
Continual focus on application cycle times and
optimization
79
U.S. Operating Results(1)
Rental & Management Revenue
Operating Profit
Tower Count
$3.15B
~40k
$2.33B
~9.6% CAGR
~12.8% CAGR
~12.4% CAGR
~19.5k
$1.24B
2007
(1)
$0.89B
2015E
2007
2015E
›
Double digit revenue growth driven by organic growth and new assets
›
Focused on driving sustainable, profitable growth
›
Organic core gross margin conversion ratio of over 90% expected in 2015
2007
2015E Rental and Management Revenue and Operating Profit Reflects 2015 outlook midpoints, as reported in the Company’s Form 8-K, dated October 29, 2015.
2015E
80
U.S. Revenue Overview
Executed New Business
Total Revenue(1)
3%
2%
Revenue by Product(2)
2%
11%
1%
5% 3%
29%
13%
47%
45%
21%
34%
36%
29%
24%
20%
9%
32%
8%
15%
36%
23%
21%
2012
2013
92%
9%
19%
11%
2014
2015
YT D
Towers
Managed Networks
AT&T
Verizon
T-Mobile
Sprint
Other
Other
T-Mobile
Verizon
AT&T
Sprint
Generators, Ground & Other
Other
(2)
Collocations
22%
44%
67%
24%
74%
Amendments 78%
56%
33%
76%
26%
~87% of Total Revenue in 2015 from the Big 4 Carriers
(1)
(2)
Reflects YTD 2015 as of September 30, 2015.
Reflects YTD mix as of September 30, 2015.
81
Managed Networks Opportunity
~300 networks
~17,000 antennas
~2.1 tenants
~30 networks
~560 nodes
~1.1 tenants
Indoor
›
›
Portfolio centered on exclusive
locations in casinos, malls,
convention centers and sports
arenas
›
›
›
Due to signal propagation
limitations, 80% of future small cell
deployments are expected to be
indoors
Rooftops
›
Outdoor
Portfolios centered in dense urban
and challenging macro tower
zoning environments
Due to high capital intensity, 80% of
small cell capex is expected to be
spent outdoors
Backhaul / Technology
Unique asset base concentrated in
densely populated urban areas
throughout the U.S.
Part of AMT’s comprehensive suite
of network solutions for our
customers
›
›
AMT selectively deploys fiber to
support small cell projects today
Technology risks are considered in
project-based hurdle rates
›
SDN, SON, wireless backhaul
technology developments and WDM
Managed Networks Round Out Our Full Suite of Infrastructure Solutions for Carriers
Abbreviations: SDN = Software Defined Network
SON = Self-Optimizing Network
WDM = Wavelength-division multiplexing
82
U.S. Growth History
Organic Growth(1)
›
Solid trends supported by
growth in mobile data
usage
›
Focus on long-term
contracts and churn
minimization has yielded
strong, consistent growth
›
›
U.S. Organic Core Growth
8.7%
8.4%
44% of current domestic
tower count added through
acquisition since 2011
Younger, less mature
portfolio provides
compelling incremental
collocation opportunity
›
New build strategy
complements organic
growth and M&A program
›
Important portion of our
overall value proposition for
carrier customers
U.S. New Builds
U.S. # of Towers Acquired
657
~11,500
9.6%
7.3%
New Builds(1)
Acquisitions
~7%
331
4,928
245
249
Average of ~8%
2011
2012
2013
2014
2015E
204
716
2011
2012
~100
242
2013
2014
2015E
2011
2012
2013
2014
2015E
Comprehensive Growth Strategy Has More than Doubled U.S. Business in 6 Years
(1) Reflects 2015 outlook midpoints, as reported in the Company’s Form 8-K, dated October 29, 2015 and/or metrics as of 9/30/15. Organic core growth metric is net
of all churn.
Definitions are provided at the end of this presentation.
83
U.S. M&A Overview
Spectrasite Merger (2005)
Deal Highlights
Deal Highlights
›
›
›
›
›
›
~7,800 sites
Day one tenancy of ~1.7
Exclusive rights for >300 In-
Deal Highlights
~4,800 U.S. sites
Day one tenancy of ~2.0
70% of revenue from Big 4
building locations
›
›
›
›
›
~11,500 sites
Day one tenancy of ~1.4
10yr Verizon anchor term
~95% of revenue from Big 4
~2/3 of revenue from “Big 4”
Financial Performance
Financial Performance
›
›
›
Current ROIC of ~17%
Spectrasite Tower Tenancy
2.6
Year 1
2010
Financial Performance
Gross Margin%(3) : 74.4%
SG&A synergies ahead of plan
GTP Organic Core Growth(4)
2.9
9.2%
$205m
Organic Core
Growth
Q1-Q3 '15
Revenue
›
Expected annual revenue
growth of 9-10% over 10 year
period (2)
% of VZ Site Audits Completed
$188m
1.7
(1)
(2)
(3)
(4)
Verizon Towers (2015)(1)
Global Tower Partners (2013)
Q315
Q1-Q3 '14
Revenue
Reflects acquisition of rights for ~11,500 towers.
Reflects average expected annual growth over first 10 years in AMT portfolio.
2015E.
Wireless & Broadcast Towers only.
Definitions are provided at the end of this presentation.
97%
84
Key Priorities Looking Forward
Enhance Margins
›
›
›
›
Utilize expanded
nationwide portfolio to
drive organic growth
Continue to employ
disciplined contract
structures to drive
additional value
Manage operating
expenses and reduce
SG&A as a % of
revenue
Proactively extend and
purchase ground leases
Operational Excellence
›
›
›
›
Drive customer
connectivity
Maintain efficient cycle
times and provide best
possible customer
experience
Invest in people,
processes and systems
Continue to focus on
cost efficiency at all
levels of organization
Investment in Assets
›
›
›
Evaluate all accretive
investment
opportunities, both in
macro towers and
other complementary
areas
Maintain focus on
investments that
generate the best riskadjusted returns
Support international
activities
85
Key Opportunities
1
Drive Strong Leasing Growth on Previously Under-Utilized Verizon Tower
Portfolio
2
Renew/Establish NPV-Accretive Master Lease Agreements
3
Utilize Upcoming Public Safety Build and New Spectrum Assets Expected
to Come to Market to Drive Incremental Growth
We Are Focused on Generating Recurring, Long-Term Growth in the U.S.
86
U.S. Q&A
U.S. Appendix
Supplementary U.S. Data(1)
(1)
(2)
Country
Years
Operating in
Market(2)
Avg Years in
AMT
Portfolio(1)
% of AMT
Rental
Revenue(2)
# of
Towers
Avg
Tenancy
# of DAS
Systems
Consolidated ROIC
U.S.
20
7.0
66.6%
40,066
2.2
328
9.3%
As of 9/30/15.
As of the quarter ended 9/30/15.
89
U.S. Tower Vintage Analysis(1)
% of Towers by Vintage(3)
49%
Tenancy per Tower(3)
46%
2.9
1.8
1.6
6%
>10 Years
5-10 Years
<5 Years
Tenant Rental Revenue per Tower(1)(2)
(USD in thousands)
>10 years
5-10 years
<5 years
NOI Yield
19%
103
13%
57
43
5%
>10 years
(1)
(2)
(3)
5-10 years
<5 years
Tenant Revenue per Tower represents annualized Q3 2015 results. Vintage reflects years in AMT portfolio.
Rental revenue excludes straight-line and services revenue.
% of Towers and Tenancy per Tower is only for wireless and broadcast assets.
>10 years
5-10 years
<5 years
90
American Tower Corporation
2015 Investor Day Closing Remarks
Tom Bartlett, CFO
We Have Generated Strong, Consistent Results Over the
Long Term While Distributing Cash to Stockholders(1)
Rental and Management
Segment Revenue
AFFO
Adjusted EBITDA
$4.7B
$3.0B
$2.1B
$1.0B
$1.4B
2007 2008
2007
2009 2010 2011 2012 2013 20142015E
2015E
15.9% CAGR
Since 2007, we have
deployed nearly
$30 Billion
(1)
$0.6B
2007 2008
2007
2009 2010 2011 2012 2013 20142015E
2015E
2007
15.2% CAGR
$2.1B
Common
Stock
Dividend
2015E
16.2% CAGR
$3.6B
$22B
Share
Repurchases
Capex and
Acquisitions
2015E reflects midpoint of 2015 outlook, as reported in the Company’s 8-K, dated October 29, 2015.
92
are provided
at the to
end
of this
presentation
and reconciliations
measures can be found at www.americantower.com.
Definitions and
reconciliations
GAAP
measures
are provided
at the end to
of GAAP
this presentation.
We Have Simultaneously Grown Our Global Portfolio, AFFO
per Share, and Return on Invested Capital
Global Tower Count
~100k
Key Considerations
›
~23k
2007
2008
2009
2010
2011
2012
2013
2014
Consolidated ROIC up despite the
addition of nearly 80,000 new
(1)
2015E
assets
AFFO Per Share
$5.02
›
Strong ROIC trends reflect 90%+
gross margin conversion rates for
$1.52
2007
organic leasing revenue growth
2008
2009
2010
2011
2012
2013
2014
(1)
2015E
›
ROIC on assets in the portfolio
since 2007 of ~17%
Return on Invested Capital
9.6%
9.0%
›
We expect to meaningfully expand
ROIC on our existing assets over
time
(2)
2007
(1)
(2)
(3)
(4)
2008
2009
2010
2011
2012
2013
(3)
2014
(4)
3Q15A
Reflects Midpoint of 2015 Outlook, as reported on the Company’s Form 8-K, dated October 29, 2015. AFFO per share calculation assumes 2015 weighted average share count of 423m.
2007 cash tax in ROIC calculation has been adjusted to exclude a cash tax refund received in 2007 related to the carry back of certain federal net operating losses. Q3 2015 cash tax has been
93
adjusted to exclude a one-time cash tax payment associated with folding the GTP REIT into the American Tower REIT.
2013 has been adjusted to reflect a full year contribution from the GTP assets.
Definitions and reconciliations to GAAP measures are provided at the end of this presentation.
3Q15A reflects annualized 3Q15 results.
We Have Been Extremely Disciplined With Our Investments
Across Our Global Footprint
Major International Market
NOI Yield(1)
U.S. Rental and Management Segment
NOI Yield
21%
16%
14%
13%
14%
13%
12%
Legacy Sites (2)
Legacy Sites (2)
Total
Total
2011
›
›
(1)
(2)
(3)
(4)
13%
12%
2012
2013
2014
(3)
3Q15A
NOI yields on legacy assets up ~50% in less
than five years
Positioned to replicate this type of NOI yield
expansion on new assets
2011
›
›
2012
11%
(4)
2013
11%
2014
10%
(3)
3Q15A
Legacy NOI yield expansion has been driven by
strong organic revenue growth
Excellent opportunity to drive similar results on
GTP and Verizon portfolios
Major international markets include Brazil, Mexico, India and South Africa. FX rates for numerator and denominator have been re-measured at each period.
Legacy sites reflect sites in the portfolio since 2011.
3Q15A reflects annualized 3Q15 results.
Definitions are provided at the end of this presentation
2013 reflects annualized impact of GTP portfolio.
94
We Have Positioned Ourselves to Benefit from Growth in
Broadband Wireless in a Diverse Array of Markets
Average
Tenancy
2015 YTD
Organic Core
Growth
Region
Population(1)
# of AMT
Sites
U.S.
~0.3B
~40k
~2.2
~7%
LatAm
~0.4B
~32k
~1.5
~10%
India(2)
~1.3B
~57k
~2.0
~10%
EMEA
~0.4B
~12k
~1.5
~13%
Total
~2.4B
~140k
~1.9
~8%
We Expect to Benefit from Our Global Diversification for Many Years to Come
(1)
(2)
Reflects markets in which American Tower operates.
Pro forma for Viom transaction, except for YTD organic core growth.
Source: CIA World Factbook
95
We Have Managed Our Investment-Grade Balance Sheet to
Position Us for Success in Varied Interest Rate Environments
Debt Balances as of September 30, 2015(1)(2)
Financial Policy
$ in millions
Long Term Target
$5.1B
$2.6B
$1.0B
$0.7B
$1.3B
$0.2B
2015
2016
2017
Senior Notes
2018
2019
3-5x (LQA)
Fixed Rate Debt
80% of Debt
Secured Debt
25% of Debt
Local Financing
Opportunistic
Liquidity
$150m cash
$1B total
$2.3B
$1.9B
$1.5B
Net Leverage
2020
2021
U.S. Secured Debt
2022
2023
2024
2025
Drawn Bank Debt
Key Balance Sheet Takeaways
›
Weighted average debt tenor of over 5 years, with weighted average cost of debt of ~3.4%(2)
›
~70% of balance sheet is composed of fixed-rate debt
›
Laddered maturities, with continued focus on opportunistic refinancing at attractive rates
›
›
(1)
(2)
Minimal near-term maturities
Liquidity of nearly $2 Billion
Excludes approximately $462 million of subsidiary and international debt.
Includes the impact of amendment agreements effective October 28, 2015 that extended the maturity dates of the 2013 Credit Facility, the 2014 Credit
Facility and the Term Loan to June 28, 2019, January 29, 2021 and January 29, 2021, respectively.
96
Our Embedded Operational FX Hedges Have Been Effective
Over the Long Term
Historical Value of Hypothetical Brazilian Lease
180
Historical Value of Hypothetical Mexican Lease
Day 1 = 100 USD
Day 1 = 100 USD
280
140
220
100
160
60
100
20
1995
1999
2003
CPI and FX Adjusted
2007
2011
2015
40
1995
FX Only Adjusted
1999
2003
CPI and FX Adjusted
2007
2011
FX Only Adjusted
Key Takeaways
›
CPI-linked contractual escalators in our international markets have substantially compensated for
currency devaluation over the long term
›
›
›
We have put USD-denominated leases into place in select international markets (Nigeria)
We are continuing to increase our local currency debt as an additional layer of hedging FX
We utilize conservative future FX assumptions as part of our evaluation of international transactions
97
2015
Looking Forward
We Are Focused on Continuing Our Prudent
Capital Deployment Strategy
›
Dividend has more than doubled since
Common Dividend
$1.81
2012
›
$1.40
Expect payout ratio to increase as
NOLs are utilized and depreciation tax
$0.90
$1.10
shield declines
›
Have deployed approximately $3B in
2012
2013
2014
2015
capex, over $14B for acquisitions, and
over $2B in dividends since 2012
›
~87% of spending has been for
2012-2015 Capital Deployment(1)
2%
12%
Acquisitions
discretionary growth initiatives
›
Focused on maintaining investment grade
credit rating
›
Discretionary Capex
14%
73%
Non-Discretionary
Capex
Common Dividends /
Buybacks
Continuing to target ~5x net leverage by
4Q16
Nearly $20B Deployed Since 2012
Disciplined Capital Allocation Continues to Drive Strong Total Stockholder Returns
(1)
2015 spending reflects midpoint of 2015 outlook for capex, as reported in the Company’s Form 8-K, dated October 29, 2015, and acquisitions closed year to date as of 9/30/15..
99
Our Business Is Built for Long-Term
Success
Diversified Global Portfolio
› Meaningful Organic
Growth
Secular Demand Trends
Disciplined Capital
Allocation Process
Prudent Balance Sheet
› Global New Build and
Acquisition Programs
› Strong AFFO per Share
growth
› Robust Growth in
Deep Talent Pool
Common Share Dividend
We Expect to Drive Compelling Total Stockholder Returns over the Long Term
100
Definitions are provided at the end of this presentation.
Thank You
Q&A
Definitions
Adjusted EBITDA: Net income before Income (loss) on discontinued operations, net; Income (loss) from equity method investments; Income
tax benefit (provision); Other income (expense); Gain (loss) on retirement of long-term obligations; Interest expense; Interest income; Other
operating income (expense); Depreciation, amortization and accretion; and Stock-based compensation expense.
Adjusted EBITDA Margin: the percentage that results from dividing Adjusted EBITDA by total revenue.
Adjusted Funds From Operations, or AFFO: NAREIT Funds From Operations before (i) straight-line revenue and expense, (ii) stockbased compensation expense, (iii) the non-cash portion of our tax provision, (iv) non-real estate related depreciation, amortization and
accretion, (v) amortization of deferred financing costs, capitalized interest, debt discounts and premiums and long-term deferred interest
charges, (vi) other income (expense), (vii) gain (loss) on retirement of long-term obligations, (viii) other operating income (expense), and
adjustments for (ix) unconsolidated affiliates and (x) noncontrolling interest, less cash payments related to capital improvements and cash
payments related to corporate capital expenditures.
AFFO per Share: Adjusted Funds From Operations divided by the diluted weighted average common shares outstanding.
Churn: Revenue lost when a tenant cancels or does not renew its lease, and in limited circumstances, such as a tenant bankruptcy,
reductions in lease rates on existing leases.
Core Growth: (Rental and management revenue, Adjusted EBITDA, Gross Margin and Operating Profit) the increase or decrease,
expressed as a percentage, resulting from a comparison of financial results for a current period with corresponding financial results for the
corresponding period in a prior year, in each case, excluding the impact of pass-through revenue (expense), straight-line revenue and
expense recognition, foreign currency exchange rate fluctuations and material one-time items.
NAREIT Funds From Operations: Net income before gains or losses from the sale or disposal of real estate, real estate related impairment
charges, real estate related depreciation, amortization and accretion and dividends on preferred stock, and including adjustments for (i)
unconsolidated affiliates and (ii) noncontrolling interest.
Net Leverage Ratio: Net debt (total debt, less cash and cash equivalents) divided by last quarter annualized Adjusted EBITDA.
NOI Yield: the percentage that results from dividing gross margin by gross property, plant and equipment, goodwill and intangible assets.
New Property Core Growth: (Rental and management revenue) the increase or decrease, expressed as a percentage, on the properties
the Company has added to its portfolio since the beginning of the prior period, in each case, excluding the impact of pass-through revenue
(expense), straight-line revenue (expense), foreign currency exchange rate fluctuations and significant one-time items.
102
Definitions
Organic Core Growth: (Rental and management revenue) the increase or decrease, expressed as a percentage, resulting from a
comparison of financial results for a current period with corresponding financial results for the corresponding period in a prior year, in each
case, excluding the impact of pass-through revenue (expense), straight-line revenue and expense recognition, foreign currency exchange
rate fluctuations, significant one-time items and revenue associated with new properties that the Company has added to the portfolio since
the beginning of the prior period.
Pass-through Revenues: In several of our international markets we pass through certain operating expenses to our tenants, including in
Latin America where we primarily pass through ground rent expenses, and in India and South Africa, where we primarily pass through fuel
costs. We record pass-through as revenue and a corresponding offsetting expense for these events.
Return on Invested Capital: Adjusted EBITDA less improvement and corporate capital expenditures and cash taxes, divided by gross
property, plant and equipment, goodwill and intangible assets.
Segment Gross Margin: segment revenue less segment operating expenses, excluding stock-based compensation expense recorded in
costs of operations; depreciation, amortization and accretion; selling, general, administrative and development expense; and other operating
expenses. International rental and management segment includes interest income, TV Azteca, net.
Segment Gross Margin Conversion Rate: the percentage that results from dividing the change in gross margin by the change in revenue.
Segment Operating Profit: Segment gross margin less segment selling, general, administrative and development expense attributable to
the segment, excluding stock-based compensation expense and corporate expenses. International rental and management segment
includes interest income, TV Azteca, net.
Straight-line expenses: We calculate straight-line ground rent expense for our ground leases based on the fixed non-cancellable term of
the underlying ground lease plus all periods, if any, for which failure to renew the lease imposes an economic penalty to us such that renewal
appears, at the inception of the lease, to be reasonably assured. Certain of our tenant leases require us to exercise available renewal
options pursuant to the underlying ground lease, if the tenant exercises its renewal option. For towers with these types of tenant leases at the
inception of the ground lease, we calculate our straight-line ground rent over the term of the ground lease, including all renewal options
required to fulfill the tenant lease obligation.
Straight-line revenues: We calculate straight-line rental revenues from our tenants based on the fixed escalation clauses present in noncancellable lease agreements, excluding those tied to the Consumer Price Index or other inflation-based indices, and other incentives
present in lease agreements with our tenants. We recognized revenues on a straight-line basis over the fixed, non-cancellable terms of the
applicable leases.
103
Historical Reconciliations
($ in millions. Totals may not add due to rounding.)
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA
2007
Net i ncome
Los s (i ncome) from di s continued opera tions , net
Income from continui ng opera tions
$56.6
2008
$347.4
2009
$247.1
2010
$373.6
2011
$381.8
2012
$594.0
2013
$482.2
2014
$803.2
1Q14
$193.3
2Q14
$221.7
3Q14
$206.6
4Q14
$181.6
1Q15
$195.5
2Q15
$157.2
3Q15
$97.7
36.4
(111.0)
(8.2)
(0.0)
-
-
-
-
-
-
-
-
-
-
-
$93.0
$236.4
$238.9
$373.6
$381.8
$594.0
$482.2
$803.2
$193.3
$221.7
$206.6
$181.6
$195.5
$157.2
$97.7
Income from equi ty method i nves tments
(0.0)
(0.0)
(0.0)
(0.0)
(0.0)
(0.0)
-
-
-
-
-
-
-
-
-
Income tax provi s i on
59.8
135.5
182.6
182.5
125.1
107.3
59.5
62.5
17.6
21.8
10.4
12.6
23.9
14.0
94.2
(20.7)
(6.0)
(1.3)
(0.3)
123.0
38.3
207.5
62.1
3.7
16.5
34.0
7.8
54.5
2.1
66.7
35.4
4.9
18.2
1.9
0.0
0.4
38.7
3.5
0.2
1.3
(3.0)
4.9
3.7
75.1
0.0
Interes t expens e
235.8
253.6
249.8
246.0
311.9
401.7
458.3
580.2
143.3
146.2
143.2
147.5
147.9
148.5
149.8
Interes t i ncome
(10.8)
(3.4)
(1.7)
(5.0)
(7.4)
(7.7)
(9.7)
(14.0)
(2.0)
(2.3)
(3.9)
(5.9)
(3.0)
(4.4)
(4.5)
9.2
11.2
19.2
35.9
58.1
62.2
71.5
68.5
13.9
12.8
11.2
30.7
7.8
17.4
15.7
522.9
405.3
414.6
460.7
555.5
644.3
800.1
1,003.8
245.8
245.4
249.1
263.5
263.5
328.4
341.1
54.6
54.8
60.7
52.6
47.4
52.0
68.1
80.2
24.6
18.8
18.3
18.4
29.9
24.0
18.3
$979.3
$1,092.3
$1,180.9
$1,347.7
$1,595.4
$1,892.4
$2,176.4
$2,649.9
$640.5
$682.2
$666.0
$661.3
$723.7
$762.3
$779.0
Other (i ncome) expens e
Los s (ga i n) on retirement of l ong-term obl i ga tions
Other opera ting expens es
Depreci a tion, a mortiza tion a nd a ccretion
Stock-ba s ed compens a tion expens e
ADJUSTED EBITDA
Di vi ded by total revenue
ADJUSTED EBITDA MARGIN
$1,456.6
$1,593.5
$1,724.1
$1,985.3
$2,443.5
$2,876.0
$3,361.4
$4,100.0
$984.1
$1,031.5
$1,038.2
$1,046.3
$1,079.2
$1,174.4
$1,237.9
67%
69%
68%
68%
65%
66%
65%
65%
65%
66%
64%
63%
67%
65%
63%
AFFO RECONCILIATION (1)
2007
Adjus ted EBITDA
2008
2009
2010
2011
2012
2013
2014
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
$979.3
$1,092.3
$1,180.9
$1,347.7
$1,595.4
$1,892.4
$2,176.4
$2,649.9
$640.5
$682.2
$666.0
$661.3
$723.7
$762.3
$779.0
Stra i ght-l i ne revenue
(69.7)
(50.4)
(36.3)
(105.2)
(144.0)
(165.8)
(147.7)
(123.7)
(31.2)
(33.1)
(31.9)
(27.4)
(33.8)
(35.5)
(38.8)
Stra i ght-l i ne expens e
26.7
27.6
26.6
22.3
31.0
33.7
29.7
38.4
9.5
7.9
12.4
8.7
8.8
14.0
16.4
(227.5)
(244.0)
(240.4)
(237.6)
(300.8)
(380.6)
(435.3)
(571.6)
(139.9)
(143.1)
(144.7)
(144.0)
(144.3)
(143.2)
(142.5)
Ca s h i nteres t
Interes t Income
Ca s h recei ved (pa i d) for i ncome taxes (2)
Di vi dends on preferred s tock
10.8
3.4
1.7
5.0
7.4
7.7
9.7
14.0
2.0
2.3
3.9
5.9
3.0
4.4
4.5
(35.3)
(35.1)
(40.2)
(36.4)
(53.9)
(69.3)
(51.7)
(69.2)
(19.1)
(16.7)
(16.6)
(16.8)
(14.7)
(15.2)
(7.3)
-
-
-
-
-
-
-
(23.9)
-
(4.4)
(7.7)
(11.8)
(9.8)
(26.8)
(26.8)
Ca pi tal Improvement Ca pex
(29.2)
(32.5)
(32.5)
(31.4)
(60.8)
(75.4)
(81.2)
(75.0)
(17.2)
(17.2)
(15.8)
(24.7)
(16.8)
(19.8)
(22.2)
Corpora te Ca pex
(12.7)
(5.6)
(8.1)
(11.6)
(18.7)
(20.0)
(30.4)
(24.1)
(5.2)
(3.9)
(5.7)
(9.3)
(2.3)
(3.2)
(4.3)
$642.4
$755.8
$851.7
$952.8
$1,055.5
$1,222.6
$1,469.5
$1,814.7
$439.3
$473.9
$459.8
$441.7
$513.6
$536.8
$558.1
AFFO
(1)
(2)
Calculation of AFFO excludes start-up related capital spending.
2007 cash tax included in AFFO calculation has been adjusted to exclude a cash tax refund received in 2007 related to the carry back of certain federal net
operating losses.
In millions, totals may not add due to rounding
104
2015 Outlook Reconciliations
Reconciliations of Outlook for Net Income to Adjusted EBITDA:
In millions, except per share amounts. totals may not add due to rounding
($ in millions)
Full Year 2015
Net income
Interest expense
Depreciation, amortization and accretion
Income Tax Provision (3)
Stock based compensation expense
$670
to
$690
593
to
610
1,262
to
1,272
170
to
140
90
-
90
Other, including other operating expenses, interest income, loss on retirement of long-term
obligations, income (loss) on equity method investments and other income (expense)
Adjusted EBITDA
251
$
3,035
to
254
$
3,055
Reconciliations of Outlook for Net Income to Adjusted Funds From Operations:
($ in millions)
Full Year 2015
Net income
$670
to
$690
Straight-line revenue
(152)
-
(152)
Straight-line expense
55
-
55
Depreciation, amortization and accretion
1,262
to
1,272
Non-cash stock based compensation expense
90
-
90
Non-cash portion of tax provision
(6)
to
(9)
GTP REIT One-Time Charge
93
-
93
Non-cash portion of interest expense
22
-
22
266
to
269
Other, including other operating expenses, loss on retirement of long-term obligations
and other expense (income)
Dividends on preferred stock
(90)
-
(90)
Capital improvement capital expenditures
(80)
to
(90)
(15)
-
Corporate capital expenditures
Adjusted Funds From Operations
Divided by Weighted Average Shares Outstanding
Adjusted Funds From Operations per Share
$
2,115
(15)
$
2,135
423
-
423
$5.00
to
$5.05
(1) As reported in the Company's 8-K filed on October 29, 2015
(2) The Company's outlook is based on the following average foreign currency exchange rates to 1.00 U.S. Dollar for the fourth quarter of 2015: (a) 3.95 Brazilian Reais; (b) 695 Chilean
Pesos; (c) 3,100 Colombian Pesos; (d) 0.91 Euros; (e) 4.10 Ghanaian Cedi; (f) 66.00 Indian Rupees; (g) 16.80 Mexican Pesos; (h) 200 Nigerian Naira; (i) 3.25 Peruvian Soles; (j) 13.75
South African Rand; and (k) 3,700 Ugandan Shillings.
105
Risk Factors
This presentation contains "forward-looking statements" concerning our goals, beliefs, expectations, strategies, objectives, plans,
future operating results and underlying assumptions, and other statements that are not necessarily based on historical facts.
Examples of these statements include, but are not limited to, statements regarding our full year 2015 outlook, foreign currency
exchange rates, our expectation regarding the leasing demand for communications real estate and the anticipated contributions
of recently signed and closed acquisitions. Actual results may differ materially from those indicated in our forward-looking
statements as a result of various important factors, including: (1) decrease in demand for our communications sites would
materially and adversely affect our operating results, and we cannot control that demand; (2) if our tenants share site
infrastructure to a significant degree or consolidate or merge, our growth, revenue and ability to generate positive cash flows
could be materially and adversely affected; (3) increasing competition for tenants in the tower industry may materially and
adversely affect our pricing; (4) competition for assets could adversely affect our ability to achieve our return on investment
criteria; (5) our business is subject to government regulations and changes in current or future laws or regulations could restrict
our ability to operate our business as we currently do; (6) our leverage and debt service obligations may materially and adversely
affect us; (7) failure to successfully and efficiently integrate acquired or leased assets, including those leased from Verizon, into
our operations may adversely affect our business, operations and financial condition; (8) our expansion initiatives involve a
number of risks and uncertainties that could adversely affect our operating results, disrupt our operations or expose us to
additional risk; (9) our foreign operations are subject to economic, political and other risks that could materially and adversely
affect our revenues or financial position, including risks associated with fluctuations in foreign currency exchange rates; (10) a
substantial portion of our revenue is derived from a small number of tenants, and we are sensitive to changes in the
creditworthiness and financial strength of our tenants; (11) new technologies or changes in a tenant’s business model could make
our tower leasing business less desirable and result in decreasing revenues; (12) if we fail to remain qualified as a REIT, we will
be subject to tax at corporate income tax rates, which may substantially reduce funds otherwise available; (13) complying with
REIT requirements may limit our flexibility or cause us to forego otherwise attractive opportunities; (14) certain of our business
activities may be subject to corporate level income tax and foreign taxes, which reduce our cash flows and may create deferred
and contingent tax liabilities;
106
Risk Factors
(continued)
(15) we may need additional financing to fund capital expenditures, future growth and expansion initiatives and to satisfy our
REIT distribution requirements; (16) if we are unable to protect our rights to the land under our towers, it could adversely affect
our business and operating results; (17) if we are unable or choose not to exercise our rights to purchase towers that are subject
to lease and sublease agreements at the end of the applicable period, our cash flows derived from such towers will be
eliminated; (18) restrictive covenants in the agreements related to our securitization transactions, our credit facilities and our debt
securities could materially and adversely affect our business by limiting flexibility, and we may be prohibited from paying
dividends on our common stock if we fail to pay scheduled dividends on our preferred stock, which may jeopardize our
qualification for taxation as a REIT; (19) our costs could increase and our revenues could decrease due to perceived health risks
from radio emissions, especially if these perceived risks are substantiated; (20) we could have liability under environmental and
occupational safety and health laws; and (21) our towers, data centers or computer systems may be affected by natural disasters
and other unforeseen events for which our insurance may not provide adequate coverage. For additional information regarding
factors that may cause actual results to differ materially from those indicated in our forward-looking statements, we refer you to
the information contained in Item 1A of our Form 10-K for the year ended December 31, 2014. We undertake no obligation to
update the information contained in this presentation to reflect subsequently occurring events or circumstances.
107