American Tower ended the second quarter of 2023 with a portfolio of approximately 226,000 communications sites
American Tower Corporation (ATC) is seeing a positive outlook for its international operations given the expected increase in capital expenditures and mobile data consumption in these markets, the company’s President and CEO Tom Bartlett said during a conference call with investors.
“We have a leading international portfolio of nearly 183,000 sites that are contributing approximately 45% and 36% towards consolidated property revenues and operating profit respectively, and are expected to deliver more than 8.5% in total tenant billings growth, including greater than a 6.5% organic growth in 2023. The secular demand trends driving our international growth remained consistent. Similar to the U.S., industry estimates forecasts roughly $35 billion in carrier Capex across our non-U.S. markets in 2023 and forecast suggest mobile data consumption is set to grow in the 20% to 30% range on average in these markets over the next several years, which would mark a continuation of the trends we’ve seen over the better part of the last two decades,” the executive said.
Bartlett noted that the company has anchored its portfolio in key markets, which are in varying stages of network development relative to that of the U.S., where some level of 5G coverage deployed over a combination of low and mid-band spectrum has reached approximately 95% of the population.
“In Europe, that number is closer to 60%, while Africa and Latin America are closer to 7% to 8%, suggesting a long tail of 5G and other next generation technology investments requiring significant incremental network density.. Critical to our expansion strategy has been our discipline in establishing appropriate contract structures with the leading mobile operators in each geography,” he said.
“In fact, in Africa, approximately 90% of our Q2 property revenues are derived by market leaders Airtel, MTN, Vodafone, and Orange, as compared to roughly 80%, five years ago. In Europe, we similarly see over 80% of property revenue supported by Telefonica, Orange, Vodafone, and Deutsche Telekom versus less than 60% at the same time in 2018. In Latin America, which has a more fragmented customer base, we’re still generating approximately 75% of our property revenues from Telefonica, AT&T, American Mobile, and TIM, up from a little over 60% over the same time period,” he said.
American Tower ended the second quarter of 2023 with a portfolio of approximately 226,000 communications sites.
The company reported overall revenues of $2.77 billion for the second quarter of 2023, surging 3.6% year-on-year. American Tower’s profits for the period amounted to $462 million, down 48.2% compared to the second quarter of 2022.
For full 2023, the company said it expected its property revenues to reach $10.79-10.97 billion. American Tower Corporation also expects its net profits for the year to be in the range of $1.78-1.84 billion.
“We believe our global platform of assets is exceptionally positioned to benefit from what we expect to be a massive wave of incremental infrastructure demand required to support the technological advancements and network capabilities we’re beginning to see in the market today. By complementing our U.S. platform, with a continued disciplined approach to international growth, and a focus on leveraging our scale, capabilities and learnings from over two decades of international U.S. operations we can provide compelling growth and margin expansion, and augmented return opportunity for investors,” Bartlett added.
