Deutsche Bank Media & Telecom Conference. June 5, 2007

Transcription

1 Deutsche Bank Media & Telecom Conference June 5, 2007

2 Forward Looking Statements Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This presentation contains forward-looking statements concerning our goals, beliefs, strategies, future operating results and underlying assumptions. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those described in the last slide of this presentation and in Item 1A of our SEC Form 10- Q for the quarter ended March 31, 2007 under the caption Risk Factors and other filings we make with the SEC. We undertake no obligation to update the information contained in this presentation to reflect subsequently occurring events or circumstances. Definitions and reconciliations to GAAP measures are provided at the end of the presentation. 2

3 Market Leader

4 Our All American s US Wireless Tower Mexican Wireless Tower US Broadcast Tower 4

5 Leading Independent Tower Operator 1Q07 Tower Revenue 3% 10% 7% + 20,000 Wireless Towers Tall Broadcast Towers 78% 1Q07 Tower Operating Profit 3% 11% 8% +2,000 Wireless Towers +200 Broadcast Towers +600 Wireless Towers 78% US Wireless *Other primarily includes revenue generated by In-building systems and managed rooftop sites. US Broadcast Mexico Brazil Other* 5

6 Diverse Tenant Mix 1Q07 Rental & Management Segment Revenue Paging 2% Other 5% International 13% Sprint Nextel 20% US Broadcasters 7% Other US WSP 9% Alltel 5% T-Mobile 8% Verizon 11% AT&T* 20% 64% 64% Tower Tower Revenue Revenue from from Big Big 5 *Formerly Cingular Wireless 6

7 Important to Our Customers % of Big 5 US Carrier Networks on American Tower Sites 18% 22% 21% 14% 32% Big 5 Average 20% Source: Company reports and Wall Street research. 7

8 Focused Business Strategy & Demonstrated Performance

9 Focused Business Strategy & Demonstrated Performance Focus on core tower operations and strong business model Stable and growing revenues Relatively fixed cost structure Significant operating leverage Consistent disciplined strategy Grow core tower assets over $4 billion acquired Divested and/or discontinued low return non-core assets approximately $1 billion Maximize return on assets Maintain financial flexibility 9

10 Growing Revenue & Demonstrated Operating Leverage $350 Rental and Management Segment ($ in millions) $300 $250 $404 mm Annualized Increase in Legacy AMT Revenue $200 $150 $100 $50 $0 mm Increase in Legacy AMT Expenses $0 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 1Q4 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 *Expenses include Rental and Management Segment operating expenses and Rental and Management Segment selling, general, administrative and development expense, excluding stock-based compensation expense. AMT SSI Revenue Revenue Expense* Expense* 10

11 Customer Lease Renewal Schedule 100% % of Tower Revenue up for Renewal 90% 80% 70% 60% 50% 40% 30% $8.2bn in in non-cancelable contracts 64% 20% 10% 0% 3% 4% 5% 12% 13% 2007 (1) (1) Includes month to month contracts, and any final termination dates remaining in

12 Industry Leading Operating Margins Industry Leading Adjusted EBITDA Margins 80% 70% 65% 67% 60% 50% 53% 53% 51% 40% 30% 20% 10% 0% SSI - 2Q05 2Q05 1Q07 CCI - 1Q07 SBAC - 1Q07 AMT AMT 12

13 Industry Leading Operating Performance 2006 Annualized Operating Performance per Owned Tower $57.8 $49.6 ($ in thousands) $43.6 $32.3 $38.8 $27.5 $22.0 $10.8 Tower Revenue Tower Gross Margin Adjusted EBITDA Free Cash Flow AMT Tower Industry Peer Average *Tower Industry Peers include: Crown Castle, Global Signal and SBA Communications, Global Signal data unavailable for Free Cash Flow, therefore they have been excluded. 13

14 Consistent Adjusted EBITDA and FCF Growth $1,100 Adjusted EBITDA Growth Free Cash Flow Growth 977 $ $700 ($ in millions) $ $ $ E E ($100) (75) AMT SSI *2007E Adjusted EBITDA and Free Cash Flow reflects the midpoint of our outlook, as derived from our Form 8-K filed on May 7,

15 Accelerating Return on Invested Capital Return on Investment 8.5% 9.1% 7.7% 7.7% 6.6% 5.7% 4.9% 2.8% Q05 4Q06 1Q07 Tower Industry 1Q07 Peer Avg* Return on Invested Capital is defined as Adjusted EBITDA less Improvement and Augmentation Capex divided by Gross property and equipment, goodwill and intangibles. *Tower Industry Peers include: Crown Castle (pro forma for their acquisition of Global Signal) and SBA Communications. 15

16 Financial Strategy Net Leverage Ratio Maintain financial flexibility Over $1.0 billion of liquidity* Reduce cost of capital 5.7% average cost of debt* Invest capital prudently 13% 1Q07 new build ROI Return capital to shareholders Completed $750.0 million share repurchase plan Commenced repurchases pursuant to the Company s $1.5 billion share repurchase plan 11.5x 8.3x 7.1x 4.5x 3.7x 3.7x Q05 4Q06 1Q07 *As of May 7,

17 Confidence in the Future

18 US Wireless Industry Vibrant Growth Continues 250 Subscriber and Cell Site Growth 4Q06 Global Wireless Penetration 117% % % 77% % 54% UK Taiwan Japan US Brazil Mexico Subscribers (millions) Cell Sites (thousands) Source: CTIA Wireless Survey, June 2006 and Wall Street research. 18

19 US Wireless Industry Vibrant Growth Continues 3,500 Minutes of Use Migration 16% Data as a % of ARPU 3,000 14% 2,500 12% (billions) 2,000 1,500 Over 35% Year over Year Wireless MOU Growth 10% 8% 6% 1,000 4% 500 2% E 0% 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 Wireless Wireline Big Four Average(1) Source: CTIA, December 2006 Survey and Wall Street research Note: (1) Big Four includes AT&T (formerly Cingular Wireless), Sprint Nextel, T-Mobile USA and Verizon Wireless 19

20 US Wireless Industry Vibrant Growth Continues Service Revenue Growth Consistent Wireless Capital Spending $140 $30 40% $120 $25 35% $100 $20 30% 25% ($ in billions) $80 $60 $15 20% 15% $10 $40 10% $20 $5 5% $ $ % Source: CTIA, December 2006 Survey and Wall Street research Capex Capex as a % of Service Revenue 20

21 Spectrum Auction Creates Potential for Future Growth Spectrum Use Implication for Tower Companies Auction 66 Major Participants Geographic/ New Market Expansion Data Network Deployment/ Augmentation New National or Semi-National Network Revenue from New Leases Revenue from Lease Amendments w/cable Consortium 21

22 Investment Considerations Market leader with diverse tower portfolio Industry leading, consistent operating performance Stable and growing free cash flow Deep & experienced management team 22

23 Thank You Definitions and Reconciliations to GAAP measures follow this slide.

24 Definitions Reconciliations to GAAP measures follow this slide Segment Gross Margin: Segment revenue less segment operating expenses excluding: depreciation, amortization and accretion; selling, general, administrative and development expense; and impairments, net loss on sale of long-lived assets, restructuring and merger related expense. Rental and management segment gross margin includes interest income, TV Azteca, net. Segment Operating Profit: Segment gross margin less selling, general, administrative and development expense attributable to the segment and excludes stock-based compensation and corporate expenses. Rental and management segment operating profit includes interest income, TV Azteca, net. Adjusted EBITDA: Operating income (loss) from continuing operations before depreciation, amortization and accretion; impairments, net loss on sale of long-lived assets, restructuring and merger related expense; and noncash stock-based compensation expense; plus interest income, TV Azteca, net. Adjusted EBITDA Margin: Percentage of Adjusted EBITDA over total revenues. CAPEX: Payments for purchase of property and equipment and construction activities. Historical Free Cash Flow: Cash provided by operating activities less payments for purchase of property and equipment and construction activities. Free Cash Flow Outlook: Adjusted EBITDA less interest expense and payments for purchase of property and equipment and construction activities and also excludes anticipated cash payments for foreign taxes, net of noncash items reflected in the statement of operations. Net Debt: Total long-term obligations, including current portion, less cash and cash equivalents and restricted cash and investments. Net Leverage: Net Debt divided by last twelve months (LTM) Adjusted EBITDA. Additional Borrowing Capacity: Annualized Adjusted EBITDA multiplied by the difference between the desired target leverage ratio and the Company s current leverage ratio. Return on Assets: Annualized Adjusted EBITDA less Improvement CAPEX divided by historical gross PPE, goodwill and intangible assets. 24

25 Reconciliations to GAAP Measures (in millions) Adjusted EBITDA and Adjusted EBITDA Margin The reconciliation of net (loss)/income to Adjusted EBITDA and Adjusted EBITDA Margin is as follows: E 2Q05 4Q05 4Q06 1Q07 Net (loss)/income $ (487.2) $ (1,160.1) $ (329.0) $ (255.5) $ (181.4) $ 27.5 NA $ (36.2) $ (90.7) $ 18.3 $ 22.2 Cumulative effect of change in accounting principle, net NA Loss (income) from discontinued operations, net NA (0.0) (1.1) (Loss) Income from continuing operations $ (426.3) $ (341.6) $ (267.3) $ (247.1) $ (143.9) $ 28.3 $ 72.0 $ (35.1) $ (55.2) $ 18.2 $ 21.1 Interest expense $ $ $ $ $ $ $ $ 53.0 $ 57.0 $ 53.2 $ 53.3 Interest income (28.4) (3.5) (5.3) (4.8) (4.4) (9.0) NA (0.8) (1.5) (4.0) (3.6) Income tax (benefit) provision (119.9) (92.6) (85.6) (83.3) NA (1.4) Depreciation, amortization and accretion Impairments, net loss on sale of long-lived assets, restructuring and merger related expense NA Loss on retirement of long-term obligations NA Minority interest in net earnings of subsidiaries NA Loss (Income) on equity method investments (0.0) NA (0.0) (0.0) Stock-based compensation expense Other expenses (income) (0.2) (6.6) (5.6) (3.0) Adjusted EBITDA $ $ $ $ $ $ $ $ $ $ $ Divided by Total Operating Revenues NA NA Adjusted EBITDA margin 65% NA NA 67% Historical Free Cash Flow The calculation of historical Free Cash Flow is as follows: Free Cash Flow Outlook The calculation of Free Cash Flow outlook is as follows: E Cash provided by operating activities $ $ $ $ $ Adjusted EBITDA Outlook $ Payments for purchase of property and equipment and construction activities (180.5) (61.6) (42.2) (88.6) (127.1) Less: cash payments for taxes, net of non-cash items reflected in the statement of operations (20.0) Free Cash Flow $ (75.4) $ 94.8 $ $ $ Less: interest expense outlook (230.0) Less: payments for purchase of property and equipment and construction activities outlook (145.0) Free Cash Flow outlook $ *2007E reflects the midpoint of our outlook, as derived from our Form 8-K filed on May 7,

26 Reconciliations to GAAP Measures (in millions) Net Leverage Ratio The calculation of net leverage ratio is as follows: Q05 4Q06 1Q07 Adjusted EBITDA* $ $ $ $ $ $ Long-term obligations, including current portion 3, , , , , ,571.9 Cash and cash equivalents Restricted cash and investments Net debt $ 3,321.2 $ 3,084.2 $ 3,078.1 $ 3,500.7 $ 3,261.8 $ 3,524.7 Divided by adjusted EBITDA* Net Leverage Ratio 11.5x 8.3x 7.1x 4.5x 3.7x 3.7x Return on Invested Capital The calculation of Return on Invested Capital is as follows: Q05 4Q06 1Q07 Adjusted EBITDA* $ 205 $ 289 $ 374 $ 436 $ 781 $ 874 $ 947 Less improvement and augmentation capital expenditures (35) (26) (24) (25) (41) (59) (54) Numerator $ 170 $ 263 $ 350 $ 411 $ 740 $ 815 $ 893 Historical Gross Property and Equipment 3,698 3,284 3,285 3,270 4,740 4,795 4,860 Historical Goodwill ,100 2,200 2,336 Historical Gross Intangibles 1,621 1,460 1,454 1,503 2,724 2,640 2,638 Denominator $ 6,159 $ 5,347 $ 5,332 $ 5,366 $ 9,563 $ 9,635 $ 9,834 Return on Investment 2.8% 4.9% 6.6% 7.7% 7.7% 8.5% 9.1% *4Q05, 4Q06 & 1Q07 Adjusted EBITDA has been annualized by mulitplying the respective measure by 4. 26

27 Appendix

28 Full Year 2007 Outlook ($ in millions) Full Year 2007 Rental and management segment revenue $1,400 to $1,420 Rental and management segment gross margin $1,070 to $1,093 Services segment revenue $23 to $27 Services segment gross margin $12 to $14 Adjusted EBITDA $962 to $991 Payments for purchase of property and equipment and construction activities $140 to $150 Tower builds/in-building installations 200/25 Land purchases $40 *Reflects outlook, as derived from our Form 8-K filed on May 7, Adjusted EBITDA outlook does not include any estimate of future costs with respect to the legal and governmental proceedings related to the review of the Company s stock option granting practices. Adjusted EBITDA excludes $49 to $53 of stock-based compensation expense for the full year

29 Capitalization Table ($ millions) 3/31/2007 Leverage Pro Forma PF Leverage Cash & Cash Equivalents OpCo Debt American Tower Credit Facility 1,280 - SpectraSite Credit Facility % Senior Subordinated Notes Other Debt Total OpCo Debt 2, x x AMTT Securitization - 1,750 HoldCo Debt Proposed Revolving Credit Facility - 1, % Senior Notes % Senior Notes % Convertible Notes % Convertible Notes % Convertible Notes Total HoldCo Debt 1, x 2, x Total Debt 3, x 3, x Net Debt 3, x 3, x Pro Forma (PF) reflects: (1) Completion of $1.75 billion securitization, net of fees and other expenses (2) Pending $1.25 billion revolving credit facility, net of fees (3) Repayment of $765 million outstanding under the SpectraSite credit facility and $1,280 million under the American Tower credit facility (4) Inducement of $7.5 million of 3.25% convertible notes (5) Completed tender offer for the Company s 7.25% senior subordinated notes, of which $324.8 million were tendered and $0.3 million remained outstanding as of May 22,

30 Ground Lease Renewal Schedule 100% Over 84% of Ground Leases are not up for renewal until 2016 and beyond 80% 60% 40% 20% 0%

31 Carrier Consolidation # Overlapping Sites Potential Churn (Monthly) % of Tower Revenue* Cingular / AWE 900 $2.0 mm 1.7% Sprint / Nextel 2,000 $3.8 mm 3.2% Technical Hurdle Capacity Requirements Hurdle Cost Hurdle Contractual Hurdle Merged Network Hurdles: *% of Tower Revenue is based on 2007E tower revenue of $1.41 bn. Sprint/Nextel included leases attributable to the affiliates that have been acquired. 31

32 This presentation contains "forward-looking statements" concerning the Company s goals, beliefs, expectations, strategies, objectives, plans, future operating results and underlying assumptions, and other statements that are not necessarily based on historical facts. Examples of these statements include, but are not limited to, statements regarding our full year 2007 outlook, our stock repurchase programs and our expectations regarding future financing transactions. Actual results may differ materially from those indicated in our forward-looking statements as a result of various important factors, including: (1) a decrease in demand for tower space would materially and adversely affect our operating results and we cannot control that demand; (2) if our wireless service provider customers consolidate or merge with each other to a significant degree, our growth, revenue and ability to generate positive cash flows could be adversely affected; (3) substantial leverage and debt service obligations may adversely affect us; (4) restrictive covenants in our credit facilities and indentures could adversely affect our business by limiting flexibility; (5) due to the long-term expectations of revenue from tenant leases, the tower industry is sensitive to the creditworthiness of its tenants; (6) our foreign operations are subject to economic, political and other risks that could adversely affect our revenues or financial position; (7) a substantial portion of our revenues is derived from a small number of customers; (8) status of Iusacell Celular s financial restructuring exposes us to risks and uncertainties (9) new technologies could make our tower leasing business less desirable to potential tenants and result in decreasing revenues; (10) we could have liability under environmental laws; (11) our business is subject to governmental regulations and changes in current or future laws or regulations could restrict our ability to operate our business as we currently do; (12) increasing competition in the tower industry may create pricing pressures that may adversely affect us; (13) if we are unable to protect our rights to the land under our towers, it could adversely affect our business and operating results; (14) if we are unable or choose not to exercise our rights to purchase towers that are subject to lease and sublease agreements at the end of the applicable period, our cash flows derived from such towers would be eliminated; (15) our towers may be affected by natural disasters and other unforeseen damage for which our insurance may not provide adequate coverage; (16) our costs could increase and our revenues could decrease due to perceived health risks from radio emissions, especially if these risks are substantiated; (17) our stock option granting practices are subject to ongoing governmental proceedings, which could result in fines, penalties or other liability; (18) pending civil litigation relating to our stock option granting practices exposes us to risks and uncertainties; and (19) the bankruptcy proceeding of our Verestar subsidiary exposes us to risks and uncertainties. For other important factors that may cause actual results to differ materially from those indicated in our forward-looking statements, we refer you to the information contained in Item 1A of our Form 10-Q for the quarter ended March 31, 2007 under the caption "Risk Factors." We undertake no obligation to update the information contained in this presentation to reflect subsequently occurring events or circumstances. 32