On September 12, 2024, American Tower Corporation (the “Company” or “American Tower”) completed the sale of 100% of the equity interests in its operations in India (“ATC TIPL” or “ATC India”) to Data Infrastructure Trust, an Infrastructure Investment Trust sponsored by an affiliate of Brookfield Asset Management (the “ATC TIPL Transaction”). The ATC TIPL Transaction qualified for presentation as discontinued operations. Prior to the divestiture and classification as discontinued operations, ATC TIPL’s operating results were included within the Asia-Pacific property segment. Accordingly, the operating results of ATC TIPL are reported as discontinued operations for all periods presented. Please refer to the footnotes and definitions in this release regarding treatment of discontinued operations.
CONSOLIDATED HIGHLIGHTS
Third Quarter 2024(1)
- Total revenue grew by less than 0.1% to $2,522 million
- Total property revenue decreased 1.0% to $2,470 million
- Net income decreased 235.2% to a net loss of $(780) million(2)(3)(4)
- Adjusted EBITDA decreased 0.9% to $1,687 million
- Net income attributable to AMT common stockholders decreased 235.0% to a net loss of $(792) million(2)(3)(4)
- AFFO attributable to AMT common stockholders increased 2.6% to $1,237 million
- AFFO attributable to AMT common stockholders, as adjusted, increased 3.3% to $1,181 million(5)
BOSTON–(BUSINESS WIRE)–American Tower Corporation (NYSE: AMT) today reported financial results for the quarter ended September 30, 2024.
Steven Vondran, American Tower’s Chief Executive Officer, stated, “Adjusted for certain non-cash items in the quarter, including the loss taken upon closing our ATC India sale, our third quarter results continue to reflect the unabating demand for our global portfolio of communications infrastructure assets, underpinning the expectations we laid out at the start of the year. Carrier rollouts of 5G coverage are supporting robust activity levels in the U.S. and Europe, while emerging markets, particularly in Africa, are also seeing healthy pipelines of new business driven by network upgrades and coverage expansion.
Additionally, CoreSite delivered another fantastic quarter of new leasing, and is on pace for its third consecutive year of record sales, as accelerating hybrid-IT deployments and early signs of AI-related workloads fuel demand. Importantly, we’ve continued to execute on our previously communicated strategic priorities to enhance our portfolio, drive cost efficiencies across the business, prudently manage our capital structure, and drive a higher quality of earnings. We therefore expect to finish the year strong and be well-positioned to deliver high-quality, attractive earnings growth and shareholder returns into 2025 and beyond.”
CONSOLIDATED OPERATING RESULTS OVERVIEW(1)
American Tower generated the following operating results for the quarter ended September 30, 2024 (all comparative information is presented against the quarter ended September 30, 2023).
|
($ in millions, except per share amounts.) |
|
Q3 2024 |
|
Growth Rate |
|||
|
Total revenue |
|
$ |
2,522 |
|
|
0.0 |
% |
|
Total property revenue |
|
$ |
2,470 |
|
|
(1.0 |
)% |
|
Total Tenant Billings Growth |
|
$ |
106 |
|
|
5.9 |
% |
|
Organic Tenant Billings Growth |
|
$ |
94 |
|
|
5.2 |
% |
|
Property Gross Margin |
|
$ |
1,843 |
|
|
(1.4 |
)% |
|
Property Gross Margin % |
|
|
74.6 |
% |
|
|
|
|
Net loss(2)(3)(4) |
|
$ |
(780 |
) |
|
(235.2 |
)% |
|
Net loss attributable to AMT common stockholders(2)(3)(4) |
|
$ |
(792 |
) |
|
(235.0 |
)% |
|
Net loss attributable to AMT common stockholders per diluted share(2)(3)(4) |
|
$ |
(1.69 |
) |
|
(234.1 |
)% |
|
Adjusted EBITDA |
|
$ |
1,687 |
|
|
(0.9 |
)% |
|
Adjusted EBITDA Margin % |
|
|
66.9 |
% |
|
|
|
|
|
|
|
|
|
|||
|
Nareit Funds From Operations (FFO) attributable to AMT common stockholders(3) |
|
$ |
857 |
|
|
(44.2 |
)% |
|
AFFO attributable to AMT common stockholders |
|
$ |
1,237 |
|
|
2.6 |
% |
|
AFFO attributable to AMT common stockholders per Share |
|
$ |
2.64 |
|
|
2.3 |
% |
|
AFFO attributable to AMT common stockholders, as adjusted(5) |
|
$ |
1,181 |
|
|
3.3 |
% |
|
AFFO attributable to AMT common stockholders per Share, as adjusted(5) |
|
$ |
2.52 |
|
|
2.9 |
% |
|
|
|
|
|
|
|||
|
Cash provided by operating activities |
|
$ |
1,469 |
|
|
13.0 |
% |
|
Less: total cash capital expenditures(6) |
|
$ |
433 |
|
|
6.0 |
% |
|
Free Cash Flow |
|
$ |
1,037 |
|
|
16.2 |
% |
|
_______________ |
||
|
(1) |
Results for total revenue, total property revenue, total Tenant Billings Growth, Organic Tenant Billings Growth, Property Gross Margin, Adjusted EBITDA, AFFO attributable to AMT common stockholders, as adjusted, and AFFO attributable to AMT common stockholders per Share, as adjusted, exclude the impacts associated with discontinued operations related to the ATC TIPL Transaction. Net loss, Net loss attributable to AMT common stockholders, Net loss attributable to AMT common stockholders per diluted share, Nareit Funds From Operations (FFO) attributable to AMT common stockholders, AFFO attributable to AMT common stockholders, AFFO attributable to AMT common stockholders per Share, Cash provided by operating activities, total cash capital expenditures and Free Cash Flow include the impacts associated with discontinued operations related to the ATC TIPL Transaction. |
|
|
(2) |
Q3 2024 growth rates were impacted by a loss on the sale of ATC TIPL of $1.2 billion in the current-year period, which primarily included the reclassification of the Company’s cumulative translation adjustment in India upon exiting the market of $1.1 billion. The loss on sale of ATC TIPL is included in Loss from discontinued operations, net of taxes in the consolidated statements of operations. Q3 2024 growth rates were also impacted by an impairment charge of $322.0 million recognized in the prior-year period. |
|
|
(3) |
Q3 2024 growth rates impacted by foreign currency losses of $(337.4) million in the current period, as compared to foreign currency gains of $239.0 million in the prior-year period. |
|
|
(4) |
Q3 2024 growth rates positively impacted by the Company’s extension of the estimated useful lives of its tower assets and the estimated settlement dates for its asset retirement obligations, which is expected to result in a decrease of approximately $730 million in depreciation and amortization expense and a decrease of approximately $75 million in accretion expense for the twelve months ended December 31, 2024, as compared to the twelve months ended December 31, 2023. The Company estimates that such decreases will be relatively evenly distributed by quarter throughout the current year. |
|
|
(5) |
Represents AFFO attributable to AMT common stockholders from continuing operations adjusted for a full period of interest expense savings associated with the use of approximately $2.0 billion of proceeds from the ATC TIPL Transaction to pay down existing indebtedness under the 2021 Multicurrency Credit Facility (as defined below), at the applicable historical borrowing cost for the respective period. No additional adjustments are required related to the repayment of approximately $120 million under the India Term Loan (as defined below), as the historical interest expense associated with the India Term Loan is already considered as part of AFFO attributable to AMT common stockholders from discontinued operations when deriving AFFO attributable to AMT common stockholders from continued operations. |
|
|
(6) |
Q3 2024 cash capital expenditures includes $9.5 million of finance lease and perpetual land easement payments reported in cash flows from financing activities in the condensed consolidated statements of cash flows. |
|
Please refer to “Non-GAAP and Defined Financial Measures” below for definitions and other information regarding the Company’s use of non-GAAP measures. For financial information and reconciliations to GAAP measures, please refer to the “Unaudited Selected Consolidated Financial Information” below.
CAPITAL ALLOCATION OVERVIEW
Distributions – During the quarter ended September 30, 2024, the Company declared the following regular cash distributions to its common stockholders:
|
Common Stock Distributions |
|
Q3 2024(1) |
|
|
Distributions per share |
|
$ |
1.62 |
|
Aggregate amount (in millions) |
|
$ |
757.0 |
|
_______________ |
||
|
(1) |
The distribution declared on September 12, 2024 was paid on October 25, 2024 to stockholders of record as of the close of business on October 9, 2024. |
|
Capital Expenditures – During the third quarter of 2024, total capital expenditures were approximately $433 million, of which $43 million was for non-discretionary capital improvements and corporate capital expenditures. Total capital expenditures and non-discretionary capital improvements and corporate capital expenditures included expenditures in India in the amounts of $8 million and $2 million, respectively. For additional capital expenditure details, please refer to the supplemental disclosure package available on the Company’s website.
Other Events – During the three months ended September 30, 2024, the Company, through its subsidiary, ATC Asia Pacific Pte. Ltd., entered into agreements pursuant to which it expects to sell 100% of the ownership interests in its subsidiaries in Australia (“ATC Australia”) and New Zealand (“ATC New Zealand”) for total aggregate consideration of approximately $78.2 million as of the dates of signing, subject to certain adjustments. ATC Australia and ATC New Zealand’s operating results are included within the Asia-Pacific property segment. The divestitures will not qualify for presentation as discontinued operations.
LEVERAGE AND FINANCING OVERVIEW
Leverage – For the quarter ended September 30, 2024, the Company’s Net Leverage Ratio was 5.2x net debt (total debt less cash and cash equivalents) to third quarter 2024 annualized Adjusted EBITDA.
|
Calculation of Net Leverage Ratio(1) ($ in millions, totals may not add due to rounding.) |
|
As of September 30, 2024 |
|
|
Total debt |
|
$ |
37,098 |
|
Less: Cash and cash equivalents |
|
|
2,150 |
|
Net Debt |
|
$ |
34,948 |
|
Divided By: Third quarter annualized Adjusted EBITDA(2) |
|
|
6,746 |
|
Net Leverage Ratio |
|
5.2x |
|
|
_______________ |
||
|
(1) |
Excludes the operating results of ATC TIPL, which are reported as discontinued operations. |
|
|
(2) |
Q3 2024 Adjusted EBITDA multiplied by four. |
|
Liquidity and Financing Activities – As of September 30, 2024, the Company had approximately $10.9 billion of total liquidity, consisting of approximately $2.2 billion in cash and cash equivalents plus the ability to borrow an aggregate of approximately $8.8 billion under its revolving credit facilities, net of any outstanding letters of credit.
During the third quarter of 2024, the Company used proceeds from the ATC TIPL Transaction to repay existing indebtedness under its $6.0 billion senior unsecured multicurrency revolving credit facility (the “2021 Multicurrency Credit Facility”).
Additionally, on September 12, 2024, the Company repaid all amounts outstanding under its 10.0 billion INR (approximately $120 million at the date of borrowing) unsecured term loan in India, as amended in January 2024 (the “India Term Loan”), in connection with the completion of the ATC TIPL Transaction.
FULL YEAR 2024 OUTLOOK
The following full year 2024 estimates are based on a number of assumptions that management believes to be reasonable and reflect the Company’s expectations as of October 29, 2024. Actual results may differ materially from these estimates as a result of various factors, and the Company refers you to the cautionary language regarding “forward-looking statements” included in this press release when considering this information.
The Company’s outlook is based on the following average foreign currency exchange rates to 1.00 U.S. Dollar for October 29, 2024 through December 31, 2024: (a) 1,110 Argentinean Pesos; (b) 1.49 Australian Dollars; (c) 121.70 Bangladeshi Taka; (d) 5.70 Brazilian Reais; (e) 1.38 Canadian Dollars; (f) 945 Chilean Pesos; (g) 4,270 Colombian Pesos; (h) 0.93 Euros; (i) 16.10 Ghanaian Cedis; (j) 130 Kenyan Shillings; (k) 20.00 Mexican Pesos; (l) 1.64 New Zealand Dollars; (m) 1,700 Nigerian Naira; (n) 7,890 Paraguayan Guarani; (o) 3.80 Peruvian Soles; (p) 57.90 Philippine Pesos; (q) 17.80 South African Rand; (r) 3,710 Ugandan Shillings; and (s) 610 West African CFA Francs.
The Company’s outlook reflects estimated negative impacts of foreign currency exchange rate fluctuations to total property revenue, Adjusted EBITDA and AFFO attributable to AMT common stockholders of approximately $25 million, $20 million and $17 million, respectively, relative to the Company’s prior 2024 outlook. The impact of foreign currency exchange rate fluctuations on net income metrics is not provided, as the impact on all components of the net income measure cannot be calculated without unreasonable effort.
The Company’s 2024 outlook for total property revenue and Adjusted EBITDA will be presented on a continuing operations basis, and the changes as compared to the Company’s prior 2024 outlook described below are on the same basis. Net Income, Net income attributable to AMT common stockholders, AFFO attributable to AMT common stockholders and AFFO attributable to AMT common stockholders per Share will include discontinued operations, and the changes as compared to the Company’s prior 2024 outlook described below are on the same basis. The Company’s 2024 outlook also includes estimates for AFFO attributable to AMT common stockholders, as adjusted, and AFFO attributable to AMT common stockholders per Share, as adjusted.
The Company is raising the midpoints of its full year 2024 outlook for total property revenue and Adjusted EBITDA by $15 million and $5 million, respectively. The Company is reducing the midpoints of its full year 2024 outlook for Net Income and Net income attributable to AMT common stockholders by $1,238 million and $1,253 million, respectively, primarily due to a recorded loss on the sale of ATC TIPL of $1.2 billion, which primarily included the reclassification of the Company’s cumulative translation adjustment in India upon exiting the market of $1.1 billion. The Company is reducing the midpoints of its full year 2024 outlook for AFFO attributable to AMT common stockholders and AFFO attributable to AMT common stockholders per Share by $30 million and $0.07, respectively, due to the closing timing for the sale of ATC India, which was not assumed in the prior outlook. Excluding the impacts associated with the updated closing timing, the Company is raising its AFFO attributable to AMT common stockholders and AFFO attributable to AMT common stockholders per Share midpoints by $25 million and $0.05, respectively.
Additional information pertaining to the impact of foreign currency and Secured Overnight Financing Rate fluctuations on the Company’s outlook has been provided in the supplemental disclosure package available on the Company’s website.
|
2024 Outlook(1): ($ in millions, except per share amounts.) |
Full Year 2024 |
|
Midpoint Growth Rates vs. Prior Year |
|||||||
|
Total property revenue(2) |
$ |
9,890 |
to |
$ |
9,980 |
|
0.7% |
|||
|
Net income |
|
1,992 |
to |
|
2,072 |
|
48.6% |
|||
|
Net income attributable to AMT common stockholders |
|
1,952 |
to |
|
2,032 |
|
34.3% |
|||
|
Adjusted EBITDA |
|
6,770 |
to |
|
6,850 |
|
1.8% |
|||
|
AFFO attributable to AMT common stockholders |
|
4,890 |
to |
|
4,970 |
|
6.9% |
|||
|
AFFO attributable to AMT common stockholders per Share |
$ |
10.45 |
to |
$ |
10.62 |
|
6.7% |
|||
|
AFFO attributable to AMT common stockholders, as adjusted(3) |
|
4,616 |
to |
|
4,696 |
|
5.9% |
|||
|
AFFO attributable to AMT common stockholders per Share, as adjusted(3) |
$ |
9.86 |
to |
$ |
10.03 |
|
5.7% |
|||
|
_______________ |
||
|
(1) |
2024 outlook and the prior year period results for total property revenue, Adjusted EBITDA, AFFO attributable to AMT common stockholders, as adjusted, and AFFO attributable to AMT common stockholders per Share, as adjusted, exclude the impacts associated with discontinued operations related to the ATC TIPL Transaction. Net Income, Net income attributable to AMT common stockholders, AFFO attributable to AMT common stockholders and AFFO attributable to AMT common stockholders per Share include the impacts associated with discontinued operations related to the ATC TIPL Transaction. |
|
|
(2) |
Includes U.S. & Canada segment property revenue of $5,245 million to $5,255 million, international property revenue of $3,725 million to $3,795 million and Data Centers segment property revenue of $920 million to $930 million, reflecting midpoint growth rates of 0.6%, (1.5)% and 10.8%, respectively. The U.S. & Canada growth rate includes an estimated negative impact of approximately 3% associated with a decrease in non-cash straight-line revenue recognition. The international growth rate includes an estimated negative impact of over 6% from the translational effects of foreign currency exchange rate fluctuations. International property revenue reflects the Company’s Africa, Asia-Pacific, Europe and Latin America segments. Data Centers segment property revenue reflects revenue from the Company’s data center facilities and related assets. |
|
|
(3) |
Represents AFFO attributable to AMT common stockholders from continuing operations adjusted for a full period of interest expense savings associated with the use of approximately $2.0 billion of proceeds from the ATC TIPL Transaction to pay down existing indebtedness under the 2021 Multicurrency Credit Facility, at the applicable historical borrowing cost for the respective period. No additional adjustments are required related to the repayment of approximately $120 million under the India Term Loan, as the historical interest expense associated with the India Term Loan is already considered as part of AFFO attributable to AMT common stockholders from discontinued operations when deriving AFFO attributable to AMT common stockholders from continued operations. |
|
|
2024 Outlook for Total Property revenue, at the midpoint, includes the following components(1)(2): ($ in millions, totals may not add due to rounding.) |
U.S. & Canada Property(3) |
|
International Property(4) |
|
Data Centers Property(5) |
|
Total Property |
|||
|
International pass-through revenue |
N/A |
|
$ |
1,027 |
|
N/A |
|
$ |
1,027 |
|
|
Straight-line revenue |
232 |
|
|
33 |
|
10 |
|
|
275 |
|
|
_______________ |
||
|
(1) |
Excludes the operating results of ATC TIPL, which are reported as discontinued operations. |
|
|
(2) |
For additional discussion regarding these components, please refer to “Revenue Components” below. |
|
|
(3) |
U.S. & Canada property revenue includes revenue from all assets in the United States and Canada, other than data center facilities and related assets. |
|
|
(4) |
International property revenue reflects the Company’s Africa, Asia-Pacific, Europe and Latin America segments. |
|
|
(5) |
Data Centers property revenue reflects revenue from the Company’s data center facilities and related assets. |
|
|
2024 Outlook for Total Tenant Billings Growth, at the midpoint, includes the following components(1)(2): (Totals may not add due to rounding.) |
U.S. & Canada Property |
|
International Property(3) |
|
Total Property |
|
|
Organic Tenant Billings |
~4.7% |
|
~6% |
|
~5% |
|
|
New Site Tenant Billings |
~0% |
|
>2% |
|
~1% |
|
|
Total Tenant Billings Growth |
~4.7% |
|
>8% |
|
~6% |
|
_______________ |
||
|
(1) |
Excludes the operating results of ATC TIPL, which are reported as discontinued operations. |
|
|
(2) |
For additional discussion regarding the component growth rates, please refer to “Revenue Components” below. Tenant Billings Growth is not applicable to the Data Centers segment. For additional details related to the Data Centers segment, please refer to the supplemental disclosure package available on the Company’s website. |
|
|
(3) |
International property Tenant Billings Growth reflects the Company’s Africa, Asia-Pacific, Europe and Latin America segments. |
|
|
Outlook for Capital Expenditures(1): ($ in millions, totals may not add due to rounding.) |
Full Year 2024 |
|||||||
|
Discretionary capital projects(2) |
$ |
780 |
to |
$ |
810 |
|||
|
Ground lease purchases |
|
125 |
to |
|
145 |
|||
|
Start-up capital projects |
|
65 |
to |
|
85 |
|||
|
Redevelopment |
|
365 |
to |
|
395 |
|||
|
Capital improvement |
|
155 |
to |
|
165 |
|||
|
Corporate |
|
10 |
— |
|
10 |
|||
|
Total |
$ |
1,500 |
to |
$ |
1,610 |
|||
|
_______________ |
||
|
(1) |
Excludes the operating results of ATC TIPL, which are reported as discontinued operations. |
|
|
(2) |
Includes the construction of 1,800 to 2,600 communications sites globally and $480 million of development spend in the Company’s Data Centers segment. |
|
|
Reconciliation of Outlook for Adjusted EBITDA to Net income(1): ($ in millions, totals may not add due to rounding.) |
Full Year 2024 |
|||||||||
|
Net income |
$ |
1,992 |
|
to |
$ |
2,072 |
|
|||
|
Net loss (income) from discontinued operations, net of taxes |
|
978 |
|
— |
|
978 |
|
|||
|
Interest expense |
|
1,415 |
|
to |
|
1,405 |
|
|||
|
Depreciation, amortization and accretion |
|
2,025 |
|
to |
|
2,035 |
|
|||
|
Income tax provision |
|
385 |
|
— |
|
385 |
|
|||
|
Stock-based compensation expense |
|
185 |
|
— |
|
185 |
|
|||
|
Other, including other operating expenses, interest income, (gain) loss on retirement of long-term obligations and other (income) expense |
|
(210 |
) |
— |
|
(210 |
) |
|||
|
Adjusted EBITDA |
$ |
6,770 |
|
to |
$ |
6,850 |
|
|||
|
_______________ |
||
|
(1) |
All line items, except for Net income and Net loss (income) from discontinued operations, net of taxes, exclude the operating results of ATC TIPL, which are reported as discontinued operations. |
|
|
Reconciliation of Outlook for AFFO attributable to AMT common stockholders to Net income: ($ in millions, except share and per share data, totals may not add due to rounding.) |
Full Year 2024 |
|||||||||
|
Net income |
$ |
1,992 |
|
to |
$ |
2,072 |
|
|||
|
Straight-line revenue |
|
(275 |
) |
— |
|
(275 |
) |
|||
|
Straight-line expense |
|
48 |
|
— |
|
48 |
|
|||
|
Depreciation, amortization and accretion |
|
2,025 |
|
to |
|
2,035 |
|
|||
|
Stock-based compensation expense |
|
185 |
|
— |
|
185 |
|
|||
|
Deferred portion of income tax and other income tax adjustments |
|
104 |
|
— |
|
104 |
|
|||
|
Other, including other operating expense, amortization of deferred financing costs, debt discounts and premiums, (gain) loss on retirement of long-term obligations, other (income) expense and long-term deferred interest charges |
|
(22 |
) |
— |
|
(22 |
) |
|||
|
Capital improvement capital expenditures |
|
(155 |
) |
to |
|
(165 |
) |
|||
|
Corporate capital expenditures |
|
(10 |
) |
— |
|
(10 |
) |
|||
|
Adjustments and distributions for unconsolidated affiliates and noncontrolling interests |
|
(346 |
) |
— |
|
(346 |
) |
|||
|
Adjustments for discontinued operations |
|
1,344 |
|
— |
|
1,344 |
|
|||
|
AFFO attributable to AMT common stockholders |
$ |
4,890 |
|
to |
$ |
4,970 |
|
|||
|
Divided by weighted average diluted shares outstanding (in thousands) |
|
468,000 |
|
— |
|
468,000 |
|
|||
|
AFFO attributable to AMT common stockholders per Share |
$ |
10.45 |
|
to |
$ |
10.62 |
|
|||
|
AFFO attributable to AMT common stockholders from discontinued operations |
|
(365 |
) |
— |
|
(365 |
) |
|||
|
AFFO attributable to American Tower Corporation common stockholders from continuing operations |
$ |
4,524 |
|
to |
$ |
4,604 |
|
|||
|
Adjustment for interest expense savings associated with the use of ATC TIPL Transaction proceeds |
|
92 |
|
— |
|
92 |
|
|||
|
AFFO attributable to AMT common stockholders, as adjusted(1) |
$ |
4,616 |
|
to |
$ |
4,696 |
|
|||
|
AFFO attributable to AMT common stockholders per Share, as adjusted(1) |
$ |
9.86 |
|
to |
$ |
10.03 |
|
|||
|
_______________ |
||
|
(1) |
Represents AFFO attributable to AMT common stockholders from continuing operations adjusted for a full period of interest expense savings associated with the use of approximately $2.0 billion of proceeds from the ATC TIPL Transaction to pay down existing indebtedness under the 2021 Multicurrency Credit Facility, at the applicable historical borrowing cost for the respective period. No additional adjustments are required related to the repayment of approximately $120 million under the India Term Loan, as the historical interest expense associated with the India Term Loan is already considered as part of AFFO attributable to AMT common stockholders from discontinued operations when deriving AFFO attributable to AMT common stockholders from continued operations. |
|
Conference Call Information
American Tower will host a conference call today at 8:30 a.m. ET to discuss its financial results for the quarter ended September 30, 2024 and its updated outlook for 2024.
Contacts
Adam Smith
Senior Vice President, Investor Relations and FP&A
Telephone: (617) 375-7500
