SBA Communications Corporation (Nasdaq: SBAC) yesterday reported results for the quarter ended December 31, 2018.
Highlights of the fourth quarter include:
- Net income of $57.2 million or $0.50 per share
- AFFO per share growth of 15.2% over the year earlier period on a constant currency basis
- Added 221 sites to the portfolio during the quarter, growing the portfolio 6.0% for the year
- Repurchased 2.2 million shares during the quarter
- Tower cash flow and Adjusted EBITDA margins of 80.2% and 70.5%, respectively
“We ended 2018 with our best quarter of the year, posting strong results and seeing solid momentum as we move into 2019,” commented Jeffrey A. Stoops, President and Chief Executive Officer. “In 2018 we saw increased leasing activity domestically and internationally and we executed well. We had our best domestic leasing year in four years in terms of revenue added per tower. Tower cash flow margins continue to climb both domestically and internationally, evidencing the quality of our assets and the strength of our performance,” Stoops said.
We stayed fully invested, allocating capital in substantial amounts to both portfolio growth and stock repurchases. We met our portfolio growth goals, growing the portfolio by 6% in 2018. We have moved into 2019 with solid customer activity and backlogs right from the beginning of the year. We intend to continue to work hard to capture that business. We anticipate staying fully invested to our target net debt leverage range of 7.0x to 7.5x annualized adjusted EBITDA, and to do so through a mix of portfolio growth and stock repurchases. We believe that the combination of favorable customer demand, our strong execution against that demand and smart capital allocation will once again allow us to produce materially increasing amounts of AFFO per share as we move through 2019.”
Spencer Kurn of new street research said: “We think the setup is strong for SBAC to outperform this year and recoup its underperformance over the past twelve months. SBAC remains our top pick within the towers.”
SBA’s total revenues in the fourth quarter of 2018 were $483.8 million compared to $443.1 million in the year earlier period, an increase of 9.2%. Site leasing revenue in the quarter of $444.7 million was comprised of domestic site leasing revenue of $358.2 million and international site leasing revenue of $86.5 million. Domestic cash site leasing revenue was $356.4 million in the fourth quarter of 2018 compared to $332.9 million in the year earlier period, an increase of 7.1%. International cash site leasing revenue was $85.4 million in the fourth quarter of 2018 compared to $77.2 million in the year earlier period, an increase of 10.5%, or 23.3% excluding the impact of changes in foreign currency exchange rates.
Site leasing operating profit was $351.3 million, an increase of 8.5% over the year earlier period. Site leasing contributed 97.2% of the Company’s total operating profit in the fourth quarter of 2018. Domestic site leasing segment operating profit was $291.7 million, an increase of 8.6% over the year earlier period. International site leasing segment operating profit was $59.5 million, an increase of 8.2% over the year earlier period.
February 22, 2019
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