American Tower (AMT) Citi's 2024 Global TMT Conference summary

Strategic priorities and financial performance

• Focus on maximizing organic growth, especially through sales and selective CapEx investments, with a current emphasis on developed markets due to headwinds in emerging markets.

• Cost controls have reduced SG&A by $35 million year over year, and margin expansion remains a key goal.

• Target leverage ratio of 5.0x by year-end, supported by reduced CapEx and a flat dividend; recent quarters have seen leverage dip below this target.

• Ongoing board refreshment and governance improvements, including new committee chairs and a new board member.

• Strategic review of the global portfolio continues, with a focus on long-term shareholder value and regular evaluation of all alternatives.

Market focus and investment philosophy

• Over $25 billion invested in developed markets (U.S. and Europe) over the past four years, with a significant reduction in emerging market CapEx.

• Operational synergies and robust demand drivers have validated the international expansion thesis, but macroeconomic headwinds and FX volatility have led to higher hurdle rates and reduced exposure to emerging markets.

• Pro forma for India, about 25% of AFFO per share will come from emerging markets, expected to decline as capital is further directed to developed markets.

Domestic leasing and growth outlook

• Application volumes in Q1 were up 70% sequentially, with continued strength expected through Q4, supporting reaffirmed services guidance.

• Comprehensive agreements with major carriers smooth out leasing revenue variability, with one carrier still outside such agreements.

• Churn in the domestic segment has fallen below 1% (excluding Sprint merger), attributed to less carrier consolidation; some risk remains from potential U.S. Cellular merger.

• Long-term growth algorithm anticipates mid-single-digit growth in developed markets, with emerging markets expected to outpace once consolidation churn subsides.