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SBA Communications Corp. Sees Solid Contributions from Each of the Big Four Carriers


SBA Communications Corp. had a great third quarter with very positive operating results in both its leasing and services businesses. That was according to Brendan Cavanagh, CFO, on the firms recent Q3 call. Cavanagh pointed out that “Total GAAP site leasing revenues for the third quarter were $435.3 million and cash site leasing revenues were $430.2 million.”

He explained that “Foreign exchange rates were weaker than our estimates for the third quarter which we previously provided with our second quarter earnings release, negatively impacting leasing revenue by $1.7 million.”

Same tower recurring cash leasing revenue growth for the third quarter which is calculated on a constant currency basis was 5.9% over the third quarter of 2017, he added, including the impact of 1.8% of churn. On a gross basis, same tower growth was 7.7%.

“Domestic same tower recurring cash leasing revenue growth over the third quarter of last year was 7% on a gross basis and 5% on a net basis including 2% of churn. Approximately half of which was related to Metro, Leap and Clearwire terminations.”

During the third quarter, he noted that again, the REIT had solid contributions from each of the big four carriers. “Newly signed up domestic leasing revenue came above 60% from amendments and 40% from new leases. And the big four carriers represented 95% of total incremental domestic leasing revenue that was signed up during the quarter. We have solid backlogs with each of our major U.S. customers and we expect them to remain active, investing in their networks, resulting in a continued healthy level of new lease and amendment signings in the fourth quarter.”

Internationally, he added, “we had another strong leasing quarter with Brazil providing the biggest contribution. In Brazil, we had solid contributions from Claro, Vivo, and TIM. During the third quarter, 86.8% of consolidated cash site leasing revenue was denominated in U.S. dollars. The majority of non-U.S. dollar denominated revenue was from Brazil with Brazil representing 11.6% of all cash site leasing revenues during the quarter and 8.3% of cash site leasing revenue excluding revenues from pass-through expenses.”