American Tower Corporation: Financial and Operational Update. Second Quarter 2018

Transcription

1 American Tower Corporation: Financial and Operational Update Second Quarter 2018

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 at the end of this presentation and in Item 1A of our Form 10-K for the year ended December 31, 2017, as updated in Part II, Item 1A of out Form 10-Q for the quarter ended June 30, 2018, under the caption Risk Factors. We undertake no obligation to update the information contained in this presentation to reflect subsequently occurring events or circumstances. Definitions and reconciliations are provided at the end of the presentation. 2

3 Investment Highlights Q Results and 2018 Expectations Solid growth driven by strong network investments and geographic diversification Historical Financial Performance Consistent cash flow based returns Strong balance sheet Solid Business Model Fundamentals Long-term revenue stream Secure real estate assets High quality tenant base Global Demand Drivers and Positioning for Growth Secular growth trends in wireless New high growth assets Innovation program 3

4 Portfolio Summary (1) 16 Countries ~5,000 Global Employees ~170,000 Total Communications Sites U.S. towers International towers Distributed Antenna Systems (DAS) Asset count 40,000+ ~128,000 ~1,700 Types of locations served Mainly suburban and rural locations. Mix of urban, suburban and rural locations, typically clustered around key population centers. U.S. and international indoor and outdoor venues with clear multitenant opportunities. (1) Data as of June 30,

5 Consolidated Results Highlights $ in millions, except per share data 2Q18 2Q17 Y/Y Change Total Property Revenue $1,749 $1, % Total Revenue $1,781 $1, % Net income attributable to AMT Common Stockholders $307 $344 (10.9%) Per diluted share attributable to AMT $0.69 $0.80 (13.8%) Adjusted EBITDA $1,084 $1, % Adjusted EBITDA Margin 60.9% 61.4% Consolidated AFFO $844 $ % Per diluted share $1.90 $ % Definitions and reconciliations are provided at the end of this presentation. 5

6 Q Property Revenue ($ in millions) $1,638 Property Revenue $1, % Growth 9.1% Tenant Billings Growth 5.7% Organic Tenant Billings Growth ~7.5% 7.4% ~7.9% 5.7% Organic Tenant Billings Growth 2.9% ~3.6% (10.2%) 12.4% 6.8% Q Q Total U.S. Total Intl. Asia LatAm EMEA Normalized for Indian Carrier Consolidation-Driven Churn (1) Total Property revenue growth of nearly 7%, including a ~2% negative impact from straight-line recognition Consolidated Organic Tenant Billings Growth of nearly 6% U.S. Organic Tenant Billings Growth of 7.4% U.S. organic run-rate new business added during quarter was up over 100% vs. Q International Organic Tenant Billings Growth of ~8% excluding the impact of Indian Carrier Consolidation-Driven Churn Highest U.S. Organic Tenant Billings Growth Since Q (1) See reconciliations on page 30 of this presentation for additional details regarding Indian Carrier Consolidation-Driven Churn and calculation of normalized metrics. Definitions and reconciliations are provided at the end of this presentation. 6

7 Q Adjusted EBITDA and Consolidated AFFO ($ in millions, except per share data) $1,021 Adjusted EBITDA $1,084 Consolidated AFFO $844 $ % Growth; 6.2% Growth; ~8.5% Normalized Growth (1) 13.1% Per Share Growth ~15.5% Normalized Per Share Growth (1) Q Q % Margin 60.9% Margin Q Q $1.68/share $1.90/share Normalized Adjusted EBITDA growth (1) of ~8.5% would have been ~12% adjusting for the impacts of net straight-line recognition Consolidated AFFO per Share growth of over 13% reflects solid organic new business growth and continued focus on cost controls Continue to Drive Double Digit Growth in Consolidated AFFO and AFFO per Share (1) See reconciliations on page 30 of this presentation for additional details regarding Indian Carrier Consolidation-Driven Churn and calculation of normalized metrics. Definitions and reconciliations are provided at the end of this presentation. 7

8 Updating 2018 Property Revenue Outlook (1) ($ in millions) $6,965 Property Revenue Outlook $30 $26 Over $55 million of FX-neutral outperformance ($116) $6,905 >7% ~7% >7% >5% Organic Tenant Billings Growth ~2% >4% ~11% ~6-7% ($60) (0.9%) Prior Outlook U.S. Intl. FX Current Outlook (~11%) Total U.S. Total Intl. Asia LatAm EMEA >5% year-over-year growth; ~8% year-over-year growth on Normalized basis (2) Normalized for Indian Carrier Consolidation-Driven Churn (2) Reducing midpoint of property revenue as a result of foreign exchange translation impacts Raising Organic Tenant Billings Growth outlook primarily due to: Expected increase of nearly 50% in U.S. organic run-rate new business added in 2018 vs Strong leasing environment in Mexico and Brazil (1) Prior outlook reflects 2018 outlook midpoints, as reported in the Company s Form 8-K dated May 1, Current outlook reflects 2018 outlook midpoints, as reported in the Company s Form 8-K dated July 31, (2) See reconciliations on page 34 of this presentation for additional details regarding Indian Carrier Consolidation-Driven Churn and calculation of normalized metrics. Definitions and reconciliations are provided at the end of this presentation. 8

9 India Carrier Consolidation Update (1)(2) In-Year 2018 Consolidation Churn Impacts Metric In-Year Impact (Included in Outlook) Maintaining Indian churn expectations; Anticipating slightly higher levels of gross new business activity Property Revenue Excluding Pass-Through Pass-Through Revenue Adjusted EBITDA Consolidated AFFO ($120) million ($60) million ($115) million ($90) million Carrier consolidation process in India is progressing in-line with prior outlook projections On a gross basis, Asia Organic Tenant Billings Growth now expected to be >8%, reflecting gross new business expectations about 10% higher than our previous outlook Continue to expect total Indian Carrier Consolidation-Driven Churn of $150-$200 million, with 2018 seen as peak churn year India Market Expectations Broadly Consistent With Prior Outlook (1) Prior outlook reflects 2018 outlook midpoints, as reported in the Company s Form 8-K dated May 1, Current outlook reflects 2018 outlook midpoints, as reported in the Company s Form 8-K dated July 31, (2) See reconciliations on page 34 of this presentation for additional details regarding Indian Carrier Consolidation-Driven Churn and calculation of normalized metrics. 9 Definitions and reconciliations are provided at the end of this presentation.

10 2018 Adjusted EBITDA & Consolidated AFFO Outlook Components (1) ($ in millions) $4,315 $24 $15 Adjusted EBITDA $3 $1 Over $43 million of FX-neutral operational outperformance ($13) ($61) $4,285 $3,230 $21 Consolidated AFFO $50 million of FX-neutral operational outperformance $22 $10 ($2) ($50) $3,230 Down ($30) million (~0.7%) from prior outlook Reiterating expected growth of >11% vs. prior year Prior Outlook U.S. (2) (2) (2) Asia LatAm EMEA Other FX Current Outlook Prior Outlook $7.30/share Cash Net Adjusted Cash (2) (2) EBITDA Interest Cash Capital (2) Taxes Improvement Capex(2) Adjusted EBITDA outlook reflects strong performance of underlying business, offset primarily by unfavorable foreign exchange translation impacts Reiterating Consolidated AFFO outlook due to core business outperformance mitigating FX impacts Expect 11 th consecutive year of double-digit Consolidated AFFO growth Maintaining expectations of $7.30 in Consolidated AFFO per Share at the midpoint (3) FX Current Outlook $7.30/share (1) Prior outlook reflects 2018 outlook midpoints, as reported in the Company s Form 8-K dated May 1, Current outlook reflects 2018 outlook midpoints, as reported in the Company s Form 8-K dated July 31, (2) Specified components shown on an FX neutral basis. Cash Adjusted EBITDA excludes impact of non-cash straight-line revenue and expense. (3) Reflects weighted average diluted share count of million shares. Definitions and reconciliations are provided at the end of this presentation. 10

11 11. 0 % % % 9.5% 9.0% 8.5% 30% 25% 20% 15% 10% 5% 0% Capital Allocation Process Driving Strong Global Returns Q Capital Deployment (1) Return on Invested Capital (ROIC) (2) USD NOI Yield By Vintage (3) 10.8% 27% Common Stock Dividends 26% Acquisitions 50% 21% Discretionary Capex 15% Non- Discretionary Capex 2% Common Stock Repurchases 8% 9.4% Q18A 10% 9% 7% 5% < Present U.S. International Continued to invest in global growth initiatives using proven capital deployment methodology Increased site count by over 2.5x since 2013 and expanded ROIC by ~140 basis points USD-denominated NOI yields increased across asset base; future organic growth expected to increase yields further Continue to strategically invest in assets to support future cash flow growth (1) Percentages may not sum to 100% due to rounding. (2) Adjusted to reflect full quarter impact of acquisitions closed during the period. Q represents annualized number. (3) Purchase prices of acquired assets translated at FX rate on the closing date of acquisition. Incremental capital expenditures translated at current FX rate as international markets utilize internally generated cash flows to fund capital expenditure programs. Definitions and reconciliations are provided at the end of this presentation. 11

12 Solid Balance Sheet Position June 30, 2018 (1) ($ in millions) $2,000 $1,145 $995 $31 $1,605 $42 $1,293 $1,499 $31 $348 $31 $18 $520 $128 $1,890 $1,445 $1,000 $1,260 $1,671 $2,058 $493 $1,002 $1,316 $112 $1,140 $ Senior Notes U.S. Secured Debt Viom Debt Drawn Bank Debt Revolving Credit Facility Availability Net Leverage Ratio (LQA) 6.0x 5.0x 4.0x 3.0x 2.0x 1.0x 0.0x 5.3x 5.0x 4.7x 4.6x 4.5x 4.7x 4.8x 4.7x 4.4x 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 Within target leverage of 3-5x Liquidity of $~4.0 billion as of 6/30/18 Weighted average debt tenor of nearly 5 years Weighted average cost of debt of <4% Committed to maintaining investment grade credit rating (1) Excludes approximately $493 million of subsidiary and international debt. 12 Definitions and reconciliations are provided at the end of this presentation.

13 Tenant Base Characteristics (1)(2) Q Property Revenue Distribution Global Tenant Lease Renewal Schedule International Pass-through 14% AT&T (U.S.) 16% 58% International Tenant Revenue 32% Verizon 15% Sprint 9% 6% 7% 13% 17% Other U.S. 6% (3) T-Mobile (U.S.) 8% Pricing is primarily based on amount and positioning of equipment on the tower Leases are typically non-cancellable Leases generally include an initial term of at least 5-10 years with multiple 5-year renewal periods Annual embedded lease escalators: U.S.: typically fixed at an average of approximately 3% International: typically based on local inflation indices (4) (1) Data as of the quarter ended June 30, (2) Percentages in charts may not sum to 100% due to rounding. (3) Other U.S. includes additional voice/data providers, broadcast companies, government agencies, local municipalities, etc. (4) Escalators in India and Nigeria are typically fixed. Majority of Nigerian revenues denominated in USD and USD denominated leases typically have fixed escalators. 13

14 Commitment to a Secure Real Estate Portfolio (1) Property interest overview: Annual escalators: average approximately 3% in the U.S. and typically based on local inflation rates internationally In the United States: Over 32% of land is owned or operated pursuant to a capital lease or perpetual easement Average remaining term of approximately 28 years for properties under lease Average lease term extensions are typically years or more Landlord base characteristics: Our landlord base is highly fragmented Approximately 90% of our ground leases are held by landlords who own a single site Global ground lease expiration schedule (2) : 85% 4% 4% 3% 4% (1) Data as of the quarter ended June 30, (2) Percentages may not sum to 100% due to rounding. 14

15 Focused on Partnering with Multinational Wireless Carriers (1) U.S. Mexico Brazil Colombia Chile Peru Costa Rica Argentina Paraguay India South Africa Ghana Uganda Nigeria Germany France Over 85% of our property revenues are generated from our top 15 tenants Most of our over $31 billion of non-cancellable contracted revenue as of June 30, 2018 is from large, multinational tenants Focus on large, established tenants has helped to keep historical churn rates between 1-2% (3) per year (1) Data as of the quarter ended June 30, (2) Pending mergers include Vodafone and Idea, and Airtel and Tata Communications. (3) Q churn was elevated to approximately 3.5% due to Indian Carrier Consolidation-Driven Churn. 15

16 Evolution of Fixed to Mobile Advanced Devices Driving up Total Wireless Capex Spend $35 US WIRELESS CARRIER CAPEX ($ in BILLIONS) $30 $25 $20 $15 $10 $5 2G Telephony 3G Internet 4G Media & Content $ E Technology Continues to Evolve Towards Ubiquitous Mobility Sources: AV&Co. analysis, CTIA, UBS forecasts, Bank of America Merrill Lynch Wireless Matrix, Wall Street research. 16

17 U.S. Total Mobile Data Traffic Growth Expected to grow at >40% CAGR through at least 2023 U.S. Total Mobile- Connected Devices (1) (Millions) U.S. Monthly Traffic per Mobile Connection (1) (Gigabytes) U.S. Total Monthly Mobile Data Traffic (1) (Exabytes) CAGR CAGR CAGR % % % 763 Overall Non-IoT IoT % X = % % % Non-IoT Overall Overall % Non-IoT IoT % IoT E 2021E 2023E E 2021E 2023E E 2021E 2023E Notes: IoT: based on M2M module connections, traffic and data usage; Non-IoT includes everything other than M2M modules (e.g. smartphones, tablets, laptops, and feature phones) Sources: Cisco VNI 2016, Ericsson Mobility Report June 2018, AV&Co. Research & Analysis (1) Forward-looking datapoints reflect research estimates. 17

18 4G Densification Will Be Needed to Support Data Growth 4G will remain critical, even post-5g introduction 100% U.S. market share of connectivity standards ( E) based on % devices 80% 60% 40% 2G ~24 years lifecycle ( ) 3G ~20 years lifecycle ( ) 4G Est. ~18-20 years lifecycle ( /30) 20% 0% 3G launch 4G launch Likely early 5G launches in 2018/2019 covering both fixed wireless and mobile (e.g. T-Mobile at 600 MHz) 5G Defined 5G E 2025E The commercial launch of 5G mobile networks is expected in the 2020 timeframe (with some earlier 5G standard launches possible) In the meantime, significant 4G investments are expected to continue, with over 50% estimated 4G market share through 2025 Sources: AV&Co. Research & Analysis 18

19 >95% of U.S. Sites Outside of Urban Environments Vast majority of sites located where the traditional macro tower will continue to be the backbone of the mobile network 19

20 Mobile Data Growth Global Smartphone Data Usage Developing markets expected to see similarly strong growth as U.S. and global average; U.S. growth expected to be partially driven by initial 5G adoption Avg. Monthly Smartphone Data Usage (GB) E CAGR ( 17-23) United States France Mexico Germany Brazil South Africa India Worldwide 37% 42% 36% 34% 33% 30% 23% 31% Sources: AV&Co. Research & Analysis, Cisco VNI 2016, Ericsson Mobility Report June

21 Global Scale Leverages Global Demand (1) American Tower has a global portfolio of ~170,000 communications sites U.S. ~40,600 France ~2,500 Germany ~2,200 Mexico (2) ~9,300 Costa Rica ~500 Ghana ~2,300 Nigeria ~4,800 Uganda ~1,500 India ~77,000 Chile, Columbia & Peru ~6,800 Brazil ~18,900 Paraguay ~1,300 Argentina (3) 13 South Africa (4) ~2,600 Year Market Launched & Later (1) Data as of June 30, 2018 (2) Portfolio also includes urban telecommunications assets, including fiber, concrete poles and other infrastructure, which are excluded from the site count. (3) Portfolio primarily consists of urban telecommunications assets, fiber and the rights to utilize certain existing utility infrastructure for future telecommunications equipment installation which are excluded from the site count. (4) Portfolio also includes fiber and fiber-related assets, which are excluded from the site count. 21

22 Strong Growth in Key Financial Metrics, Complemented by Rising Dividend and ROIC (1) Property Segment Revenue $6.6B Adjusted EBITDA $4.1B $1.4B $1.0B $2,015 $2,016 Consolidated AFFO ROIC 2017 $2.9B 10.2% 9.0% $0.6B (2) Grew ROIC to >10% while generating average annual dividend per share growth >20% since 2012 (1) Net income reflects CAGR of ~36% from 2007 to (2) Adjusted to annualize impacts of acquisitions closed throughout the year. 22 Definitions and reconciliations are provided at the end of this presentation.

23 Our Stand and Deliver Strategy for the Next Decade Seeks to Extend our Strong Track Record of Growth Drive Operational Efficiency Improve internal processes with emphasis on tenant solutions Drive margin expansion by maximizing leasing growth on existing portfolio while driving opex and maintenance capex efficiencies Invest in and deploy renewable energy solutions to streamline internal operations and billing, improve industry efficiency and minimize carbon footprint Grow Portfolio and Capabilities Continued focus on classic macro tower investment opportunities Seek incremental investments using disciplined, proven investment evaluation process Secure franchise communications real estate assets with tower-like returns to enhance product offerings as technology continues to evolve Focus on Innovation Position AMT for success in an emerging 5G world Leverage existing assets for additional applications Evaluate new communications real estate architectures Capture opportunities to serve new tenants beyond traditional mobile operator client base Enhance Industry Leadership Elevate global position as preferred mission-critical communications real estate partner for existing and new tenants Work closely with industry, NGO and government bodies to expand the reach of mobile broadband while driving incremental cash flow 23

24 Innovating to Maximize Future Potential Focus on Franchise Real Estate Significant focus on improving efficiency of existing portfolio, particularly with respect to energy in emerging markets Edge computing, AR/VR and autonomous vehicle networks, among others may provide attractive opportunities to incrementally utilize existing assets Simultaneously seeking new types of communications infrastructure that replicate franchise real estate characteristics of macro towers and indoor DAS Targeting macro tower-like return profiles for innovation investments Utilizing innovation program to drive incremental long-term growth 24

25 Definitions Adjusted EBITDA: Net income before income (loss) from equity method investments; Income tax benefit (provision); Other income (expense); Gain (loss) on retirement of long-term obligations; Interest expense; Interest income; Other operating income (expense); Depreciation, amortization and accretion; and Stock-based compensation expense. The Company believes this measure provides valuable insight into the profitability of its operations while at the same time taking into account the central overhead expenses required to manage its global operations. In addition, it is a widely used performance measure across the telecommunications real estate sector. Adjusted EBITDA Margin: The percentage that results from dividing Adjusted EBITDA by total revenue. Consolidated Adjusted Funds From Operations, or Consolidated AFFO: Nareit FFO attributable to American Tower Corporation common stockholders before (i) straightline revenue and expense, (ii) stock-based compensation expense, (iii) the deferred portion of income tax, (iv) non-real estate related depreciation, amortization and accretion, (v) amortization of deferred financing costs, capitalized interest, debt discounts and premiums and long-term deferred interest charges, (vi) other income (expense), (vii) gain (loss) on retirement of long-term obligations, (viii) other operating income (expense), and adjustments for (ix) unconsolidated affiliates and (x) noncontrolling interests, less cash payments related to capital improvements and cash payments related to corporate capital expenditures. The Company believes this measure provides valuable insight into the operating performance of its property assets by further adjusting the Nareit FFO attributable to American Tower Corporation common stockholders metric to exclude the factors outlined above, which if unadjusted, may cause material fluctuations in Nareit FFO attributable to American Tower Corporation common stockholders growth from period to period that would not be representative of the underlying performance of the Company s property assets in those periods. In addition, it is a widely used performance measure across the telecommunications real estate sector. Consolidated AFFO per Share: Consolidated AFFO divided by the diluted weighted average common shares outstanding. Churn: Tenant Billings lost when a tenant cancels or does not renew its lease or, in limited circumstances, when the lease rates on existing leases are reduced. Free Cash Flow: Cash provided by operating activities less total cash capital expenditures, including payments on capital leases of property and equipment. The Company believes that Free Cash Flow is useful to investors as the basis for comparing our performance and coverage ratios with other companies in its industry, although this measure of Free Cash Flow may not be directly comparable to similar measures used by other companies. Indian Carrier Consolidation-Driven Churn: Tenant cancellations specifically attributable to short-term carrier consolidation in India. Includes impacts of carrier exits from the marketplace and carrier cancellations as a result of consolidation but excludes normal course churn. The Company believes that providing this additional metric enhances transparency and provides a better understanding of its recurring business without the impact of what it believes to be a transitory event. International Pass-through Revenues: In several of our international markets we pass through certain operating expenses to our tenants, including in Latin America where we primarily pass through ground rent expenses, and in India and South Africa, where we primarily pass through power and fuel costs. We record pass-through as revenue and a corresponding offsetting expense for these events. Nareit Funds From Operations Attributable to American Tower Corporation Common Stockholders: Net income before gains or losses from the sale or disposal of real estate, real estate related impairment charges, real estate related depreciation, amortization and accretion and dividends on preferred stock, and including adjustments for (i) unconsolidated affiliates and (ii) noncontrolling interests. The Company believes this measure provides valuable insight into the operating performance of its property assets by excluding the charges described above, particularly depreciation expenses, given the high initial, up-front capital intensity of the Company s operating model. In addition, it is a widely used performance measure across the telecommunications real estate sector. Net Leverage Ratio: Net debt (total long-term debt, including current portion, less cash and cash equivalents) divided by the quarter s annualized Adjusted EBITDA. The Company believes that including this calculation is important for investors and analysts given it is a critical component underlying its credit agency ratings. NOI Yield: The percentage that results from dividing gross margin by total investment. New Site Tenant Billings Growth: The portion of Tenant Billings Growth attributable to New Site Tenant Billings. The Company believes this measure provides valuable insight into the growth attributable to Tenant Billings from recently acquired or constructed properties. The Company believes this measure provides valuable insight into the growth attributable to Tenant Billings from recently acquired or constructed properties. 25

26 Definitions New Site Tenant Billings: Day-one Tenant Billings associated with sites that have been built or acquired since the beginning of the prior-year period. Incremental colocations/amendments, escalations or cancellations that occur on these sites after the date of their addition to our portfolio are not included in New Site Tenant Billings. The Company believes providing New Site Tenant Billings enhances an investor s ability to analyze the Company s existing real estate portfolio growth as well as its development program growth, as the Company s construction and acquisition activities can drive variability in growth rates from period to period. Organic Tenant Billings: Tenant Billings on sites that the Company has owned since the beginning of the prior-year period, as well as Tenant Billings activity on new sites that occurred after the date of their addition to the Company s portfolio. Organic Tenant Billings Growth: The portion of Tenant Billings Growth attributable to Organic Tenant Billings. The Company believes that organic growth is a useful measure of its ability to add tenancy and incremental revenue to its assets for the reported period, which enables investors and analysts to gain additional insight into the relative attractiveness, and therefore the value, of the Company s property assets. Segment Gross Margin: Segment revenue less segment operating expenses, excluding stock-based compensation expense recorded in costs of operations; depreciation, amortization and accretion; selling, general, administrative and development expense; and other operating expenses. Latin America Property segment includes interest income (expense), TV Azteca, net. Segment Operating Profit: Segment gross margin less segment selling, general, administrative and development expense attributable to the segment, excluding stockbased compensation expense and corporate expenses. Latin America Property segment includes interest income (expense), TV Azteca, net. Return on Invested Capital: Adjusted EBITDA less maintenance capital expenditures and corporate capital expenditures and cash taxes, divided by gross property, plant and equipment, intangible assets and goodwill (excluding the impact of recording deferred tax adjustments related to valuation). Straight-line expenses: We calculate straight-line ground rent expense for our ground leases based on the fixed non-cancellable term of the underlying ground lease plus all periods, if any, for which failure to renew the lease imposes an economic penalty to us such that renewal appears, at the inception of the lease, to be reasonably assured. Certain of our tenant leases require us to exercise available renewal options pursuant to the underlying ground lease, if the tenant exercises its renewal option. For towers with these types of tenant leases at the inception of the ground lease, we calculate our straight-line ground rent over the term of the ground lease, including all renewal options required to fulfill the tenant lease obligation. Straight-line revenues: We calculate straight-line rental revenues from our tenants based on the fixed escalation clauses present in non-cancellable lease agreements, excluding those tied to the Consumer Price Index or other inflation-based indices, and other incentives present in lease agreements with our tenants. We recognized revenues on a straight-line basis over the fixed, non-cancellable terms of the applicable leases. Tenant Billings: The majority of the Company s revenue is generated from non-cancellable, long-term tenant leases. Revenue from Tenant Billings reflects several key aspects of the Company s real estate business: (i) colocations/amendments reflects new tenant leases for space on existing towers and amendments to existing leases to add additional tenant equipment; (ii) escalations reflects contractual increases in billing rates, which are typically tied to fixed percentages or a variable percentage based on a consumer price index; (iii) cancellations reflects the impact of tenant lease terminations or non-renewals or, in limited circumstances, when the lease rates on existing leases are reduced; and (iv) new sites reflects the impact of new property construction and acquisitions. Tenant Billings Growth: The increase or decrease resulting from a comparison of Tenant Billings for a current period with Tenant Billings for the corresponding prior-year period, in each case adjusted for foreign currency exchange fluctuations. The Company believes this measure provides valuable insight into the growth in recurring Tenant Billings and underlying demand for its real estate portfolio. 26

27 Risk Factors This presentation contains forward-looking statements concerning our 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 2018 outlook and other targets, our expectations regarding Indian Carrier Consolidation-Driven Churn and factors that could affect our expectations, foreign currency exchange rates and our expectations regarding the leasing demand for communications real estate. Actual results may differ materially from those indicated in our forward-looking statements as a result of various important factors, including: (1) a significant decrease in leasing demand for our communications infrastructure would materially and adversely affect our business and operating results, and we cannot control that demand; (2) increasing competition within our industry for tenants may materially and adversely affect our revenue; (3) if our tenants consolidate their operations, exit the telecommunications business or share site infrastructure to a significant degree, our growth, revenue and ability to generate positive cash flows could be materially and adversely affected; (4) our business is subject to government and tax regulations and changes in current or future laws or regulations could restrict our ability to operate our business as we currently do or impact our competitive landscape; (5) our foreign operations are subject to economic, political and other risks that could materially and adversely affect our revenues or financial position, including risks associated with fluctuations in foreign currency exchange rates; (6) a substantial portion of our revenue is derived from a small number of tenants, and we are sensitive to changes in the creditworthiness and financial strength of our tenants; (7) our expansion initiatives involve a number of risks and uncertainties, including those related to integrating acquired or leased assets, that could adversely affect our operating results, disrupt our operations or expose us to additional risk; (8) competition for assets could adversely affect our ability to achieve our return on investment criteria; (9) new technologies or changes in a tenant s business model could make our tower leasing business less desirable and result in decreasing revenues and operating results; (10) our leverage and debt service obligations may materially and adversely affect our ability to raise additional financing to fund capital expenditures, future growth and expansion initiatives and to satisfy our distribution requirements; (11) if we fail to remain qualified for taxation as a REIT, we will be subject to tax at corporate income tax rates, which may substantially reduce funds otherwise available, and even if we qualify for taxation as a REIT, we may face tax liabilities that impact earnings and available cash flow; (12) complying with REIT requirements may limit our flexibility or cause us to forego otherwise attractive opportunities; (13) restrictive covenants in the agreements related to our securitization transactions, our credit facilities and our debt securities could materially and adversely affect our business by limiting flexibility, and we may be prohibited from paying dividends on our common stock, which may jeopardize our qualification for taxation as a REIT; (14) our towers, data centers or computer systems may be affected by natural disasters and other unforeseen events for which our insurance may not provide adequate coverage; 27

28 Risk Factors (continued) (15) our costs could increase and our revenues could decrease due to perceived health risks from radio emissions, especially if these perceived risks are substantiated; (16) we could have liability under environmental and occupational safety and health laws; (17) if we are unable to protect our rights to the land under our towers, it could adversely affect our business and operating results; and (18) 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 those towers will be eliminated. For additional information regarding 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-K for the year ended December 31, 2017, as updated in Part II, Item 1A of out Form 10-Q for the quarter ended June 30, 2018, under the caption Risk Factors. We undertake no obligation to update the information contained in this presentation to reflect subsequently occurring events or circumstances. 28

29 Historical Reconciliations ($ in Millions, totals may not add due to rounding.) RECONCILIATION OF ADJUSTED EBITDA TO NET INCOME Q17 2Q18 Net income $57 $347 $247 $374 $382 $594 $482 $803 $672 $970 $1,225 $388 $314 Loss (income) from discontinued operations, net 36 (111) (8) (0) Income from continuing operations $93 $236 $239 $374 $382 $594 $482 $803 $672 $970 $1,225 $388 $314 Income from equity method investments (0) (0) (0) (0) (0) (0) Income tax (benefit) provision Other (income) expense (21) (6) (1) (0) (31) (12) 35 Loss (gain) on retirement of long term obligations (1) 70 0 Interest expense Interest income (11) (3) (2) (5) (7) (8) (10) (14) (17) (26) (35) (8) (18) Other operating expenses Depreciation, amortization and accretion ,004 1,285 1,526 1, Stock based compensation expense ADJUSTED EBITDA $979 $1,092 $1,181 $1,348 $1,595 $1,892 $2,176 $2,650 $3,067 $3,553 $4,090 $1,021 $1,084 Divided by total revenue $1,457 $1,594 $1,724 $1,985 $2,444 $2,876 $3,361 $4,100 $4,772 $5,786 $6,664 $1,662 $1,781 ADJUSTED EBITDA MARGIN 67% 69% 68% 68% 65% 66% 65% 65% 64% 61% 61% 61% 61% AFFO RECONCILIATION (1) Q17 2Q18 Adjusted EBITDA $979 $1,092 $1,181 $1,348 $1,595 $1,892 $2,176 $2,650 $3,067 $3,553 $4,090 $1,021 $1,084 Straight line revenue (70) (50) (36) (105) (144) (166) (148) (124) (155) (132) (194) (51) (27) Straight line expense Cash interest (227) (244) (240) (238) (301) (381) (435) (572) (573) (694) (723) (179) (202) Interest Income Cash received (paid) for income taxes (2) (35) (35) (40) (36) (54) (69) (52) (69) (64) (96) (137) (37) (20) Dividends on preferred stock (24) (90) (107) (87) (23) Dividend to noncontrolling interest (13) Capital improvement Capex (29) (33) (33) (31) (61) (75) (81) (75) (90) (110) (114) (25) (28) Corporate Capex (13) (6) (8) (12) (19) (20) (30) (24) (16) (16) (17) (4) (2) Consolidated AFFO $642 $756 $852 $953 $1,055 $1,223 $1,470 $1,815 $2,150 $2,490 $2,902 $725 $844 Adjustments for noncontrolling interests N/A N/A N/A N/A ($1) ($16) ($30) ($24) ($34) ($90) ($147) ($44) ($69) AFFO Attributable to Common Stockholders $642 $756 $852 $953 $1,055 $1,207 $1,439 $1,791 $2,116 $2,400 $2,755 $681 $775 Divided by weighted average diluted shares outstanding Consolidated AFFO per Share $ 1.51 $ 1.81 $ 2.09 $ 2.36 $ 2.64 $ 3.06 $ 3.68 $ 4.54 $ 5.08 $ 5.80 $ 6.72 $ 1.68 $ 1.90 AFFO Attributable to Common Stockholders per Share $ 1.51 $ 1.81 $ 2.09 $ 2.36 $ 2.64 $ 3.02 $ 3.61 $ 4.48 $ 5.00 $ 5.59 $ 6.38 $ 1.58 $ 1.74 RETURN ON INVESTED CAPITAL (ROIC) RECONCILIATION (3) (4) (5) 2016 (6) 2017 (7) Adjusted EBITDA $979 $1,092 $1,181 $1,348 $1,595 $1,892 $2,401 $2,650 $3,206 $3,743 $4,149 Cash Taxes (35) (35) (40) (36) (54) (69) (114) (69) (107) (98) (137) Maintenance Capex (29) (33) (33) (31) (61) (75) (81) (75) (124) (159) (115) Corporate Capex (13) (6) (8) (12) (19) (20) (23) (24) (26) (27) (17) Numerator $903 $1,019 $1,100 $1,268 $1,462 $1,728 $2,183 $2,482 $2,948 $3,459 $3,880 Gross PPE $4,992 $5,213 $5,621 $6,376 $7,889 $9,047 $10,844 $11,659 $14,397 $15,652 $16,950 Gross Intangibles 2,666 2,619 2,790 3,213 3,978 4,892 8,471 9,172 12,671 14,795 16,183 Gross Goodwill (8) 2,333 2,334 2,399 2,660 2,824 2,991 3,928 4,180 4,240 4,510 4,879 Denominator $9,991 $10,166 $10,810 $12,249 $14,691 $16,930 $23,243 $25,011 $31,308 $34,957 $38,012 ROIC 9.0% 10.0% 10.2% 10.4% 10.0% 10.2% 9.4% 9.9% 9.4% 9.9% 10.2% (1) Calculation of Consolidated AFFO excludes start-up related capital spending. (2) Excludes one-time GTP cash tax charge incurred during the third quarter of 2015 (3) Historical denominator balances reflect purchase accounting adjustments. Additionally, 2Q17 and 3Q17 reflect PP&E accounting adjustment made in U.S. in 2Q 2017, which was subsequently reversed in 3Q (4) 2013 has been adjusted to reflect a full year contribution from the GTP assets. (5) Represents Q annualized numbers to account for full year impact of Verizon Transaction. (6) Represents Q annualized numbers to account for full year impact of Viom Transaction. (7) Adjusted to annualize impacts of acquisitions closed throughout the year. (8) Excludes the impact of deferred tax adjustments related to valuation. 29

30 Historical Reconciliations: Indian Carrier Consolidation Driven Churn ($ in Millions, totals may not add due to rounding) Growth Rates vs. Prior Year Period Inclusive of Indian Carrier Consolidation-Driven Churn 2Q17 2Q18 2Q18 Total Revenue $1,663 $1, % Total Property Revenue 1,638 1, % Adjusted EBITDA 1,021 1, % Adjusted EBITDA Margin 61.4% 60.9% Consolidated AFFO $725 $ % Consolidated AFFO per Share % Consolidated Organic Tenant Billings Growth % International Organic Tenant Billings Growth % Impact of Indian Carrier Consolidation-Driven Churn 2Q17 2Q18 2Q18 Total Revenue $1 $42 (2.5%) Total Property Revenue 1 42 (2.5%) Adjusted EBITDA 1 24 (2.3%) Adjusted EBITDA Margin 0.0% (0.1%) Consolidated AFFO $1 $19 (2.6%) Consolidated AFFO per Share (2.4%) Consolidated Organic Tenant Billings Growth 1 25 (1.8%) International Organic Tenant Billings Growth 1 25 (5.0%) Normalized 2Q17 2Q18 2Q18 Total Revenue $1,663 $1, % Total Property Revenue 1,639 1, % Adjusted EBITDA 1,022 1, % Adjusted EBITDA Margin 61.4% 60.8% Consolidated AFFO $726 $ % Consolidated AFFO per Share % Consolidated Organic Tenant Billings Growth % International Organic Tenant Billings Growth % 30

31 Historical Reconciliations ($ in Millions, totals may not add due to rounding) RETURN ON INVESTED CAPITAL (ROIC) RECONCILIATION (1) 2013 (2) (3) 2016 (4) 2017 (5) 2Q18A (6) Adjusted EBITDA $2,401 $2,650 $3,206 $3,743 $4,149 $4,369 Cash Taxes (114) (69) (107) (98) (137) (84) Maintenance Capex (81) (75) (124) (159) (115) (111) Corporate Capex (23) (24) (26) (27) (17) (9) Numerator $2,183 $2,482 $2,948 $3,459 $3,880 $4,166 Gross PPE $10,844 $11,659 $14,397 $15,652 $16,950 $17,233 Gross Intangibles 8,471 9,172 12,671 14,795 16,183 16,557 Gross Goodwill (7) 3,928 4,180 4,240 4,510 4,879 4,802 Denominator $23,243 $25,011 $31,308 $34,957 $38,012 $38,592 Adjusted EBITDA Growth ex. Net Straight line and Indian Carrier Consolidation Driven Churn Q Q Growth % Adjusted EBITDA $ 1,021 $ 1,084 Straight line revenue (51) (27) Straight line expense Indian Carrier Consolidation Driven Churn impact to Adjusted EBITDA 1 24 Adjusted EBITDA Adjusting for these Items $ 985 $ 1, % Total Revenue $ 1,662 $ 1,781 Straight line revenue (51) (27) Indian Carrier Consolidation Driven Churn Impact to Total Revenue 1 42 Total Revenue Adjusting for these Items $ 1,613 $ 1, % Adjusted EBITDA Margin % Adjusting for these Items 61.1% 61.4% ROIC 9.4% 9.9% 9.4% 9.9% 10.2% 10.8% USD NOI Yield By Vintage $ Millions < >2014 U.S. Gross Investment $ 10,251 $ 7,395 $ 7,135 Cash Gross Margin 2, NOI Yield 21% 7% 5% International Gross Investment $ 851 $ 6,149 $ 10,135 Cash Gross Margin NOI Yield 27% 10% 9% NET LEVERAGE RECONCILIATION 2Q16 3Q16 4Q Q17 2Q17 3Q17 4Q17 2Q18 Total Debt $18,717 $18,679 $18,533 $18,533 $18,890 $19,242 $19,269 $20,205 $21,114 Less: Cash and cash equivalents Net Debt 18,306 18,149 17,746 17,746 18,177 18,472 18,469 19,403 20,279 Divided by: annualized Adjusted EBITDA 3,476 3,660 3,743 3,743 3,991 4,082 4,161 4,125 4,336 Net Leverage Ratio 5.3x 5.0x 4.7x 4.7x 4.6x 4.5x 4.4x 4.7x 4.7x (1) Historical denominator balances reflect purchase accounting adjustments. Additionally, 2Q17 and 3Q17 reflect PP&E accounting adjustment made in U.S. in 2Q 2017, which was subsequently reversed in 3Q (2) 2013 has been adjusted to reflect a full year contribution from the GTP assets. (3) Represents Q annualized numbers to account for full year impact of Verizon Transaction. (4) Represents Q annualized numbers to account for full year impact of Viom Transaction. (5) Adjusted to annualize impacts of acquisitions closed throughout the year. (6) Adjusted to reflect full quarter impact of acquisitions closed during the period. Represents Q annualized numbers. (7) Excludes the impact of deferred tax adjustments related to valuation. 31

32 2018 Outlook Reconciliations (1)(2) ($ in Millions, totals may not add due to rounding.) Reconciliations of Outlook for Adjusted EBITDA to Net Income: ($ in millions) Full Year 2018 Net income $1,275 to $1,335 Interest expense 840 to 820 Depreciation, amortization and accretion 1,770 to 1,810 Income Tax Provision (20) to Stock based compensation expense Other, including other operating expenses, interest income, gain (loss) on retirement of long term obligations and other expense (income) (3) Adjusted EBITDA $ 4,255 to $ 4,315 Reconciliations of Outlook for Consolidated Adjusted Funds From Operations to Net Income: ($ in millions) Full Year 2018 Net income $1,275 to $1,335 Straight line revenue (78) (78) Straight line expense Depreciation, amortization and accretion 1,770 to 1,810 Non cash stock based compensation expense Deferred portion of income tax (119) to (120) Amortization of deferred financing costs, capitalized interest and debt discounts and premiums and long term deferred interest charges 16 to 18 Other, including other operating expense, loss on retirement of long term obligations and other expense (income) (3) 300 to 270 Dividends on preferred stock (10) (10) Capital improvement capital expenditures (140) to (150) Corporate capital expenditures (10) (10) Consolidated Adjusted Funds From Operations $ 3,200 $ 3,260 (1) As reported in the Company's Form 8-K dated July 31, (2) The Company s outlook is based on the following average foreign currency exchange rates to 1.00 U.S. Dollar for July 31, 2018 through December 31, 2018: (a) Argentinean Pesos; (b) 3.85 Brazilian Reais; (c) 645 Chilean Pesos; (d) 2,930 Colombian Pesos; (e) 0.86 Euros; (f) 4.75 Ghanaian Cedi; (g) Indian Rupees; (h) Mexican Pesos; (i) 360 Nigerian Naira; (j) 5,690 Paraguayan Guarani; (k) 3.30 Peruvian Soles; (l) South African Rand; and (m) 3,850 Ugandan Shillings. (3) Includes impact of impairments, primarily in India. 32

33 Prior 2018 Outlook Reconciliations (1)(2) ($ in Millions, totals may not add due to rounding.) (1) (2) 2018 OUTLOOK ($ in millions. Totals may not add due to rounding.) Reconciliations of Outlook for Adjusted EBITDA to Net Income: ($ in millions) Full Year 2018 Net income $1,335 to $1,435 Interest expense 860 to 840 Depreciation, amortization and accretion 1,795 to 1,835 Income Tax Provision 0 to (20) Stock based compensation expense Other, including other operating expenses, interest income, gain (loss) on retirement of long term obligations and other expense (income) (3) Adjusted EBITDA $ 4,265 to $ 4,365 Reconciliations of Outlook for Consolidated Adjusted Funds From Operations to Net Income: ($ in millions) Full Year 2018 Net income $1,335 to $1,435 Straight line revenue (63) (63) Straight line expense Depreciation, amortization and accretion 1,795 to 1,835 Non cash stock based compensation expense Deferred portion of income tax (124) to (145) Amortization of deferred financing costs, capitalized interest and debt discounts and premiums and long term deferred interest charges 26 to 8 Other, including other operating expense, loss on retirement of long term obligations and other expense (income) (3) 195 to 205 Dividends on preferred stock (10) (10) Capital improvement capital expenditures (140) to (150) (1) As reported in the Company's Form 8-K dated May 1, (2) The Company s outlook is based on the following average foreign currency exchange rates to 1.00 U.S. Dollar for May 1, 2018 through December 31, 2018: (a) Argentinean Pesos; (b) 3.40 Brazilian Reais; (c) 600 Chilean Pesos; (d) 2,840 Colombian Pesos; (e) 0.81 Euros; (f) 4.50 Ghanaian Cedi; (g) Indian Rupees; (h) Mexican Pesos; (i) 385 Nigerian Naira; (j) 5,630 Paraguayan Guarani; (k) 3.25 Peruvian Soles; (l) South African Rand; and (m) 3,700 Ugandan Shillings. (3) Includes impact of impairments, primarily in India. 33

34 Reconciliation of Indian Carrier Consolidation- Driven Churn Impact to 2018 Outlook (1)(2)(3) ($ in Millions, totals may not add due to rounding.) Inclusive of Indian Carrier Consolidation- Driven Churn FY 2017 Results 2018 Outlook, at the Midpoint Midpoint Growth Rates vs. Prior Year Impact of Indian Carrier Consolidation- Driven Churn Normalized Inclusive of Indian Carrier Consolidation- Driven Churn Impact of Indian Carrier Consolidation- Driven Churn Normalized Inclusive of Indian Carrier Consolidation- Driven Churn Impact of Indian Carrier Consolidation- Driven Churn Normalized Total Property Revenue (3) $6,566 $9 $6,575 $6,905 $180 $7, % 2.6% 7.8% Adjusted EBITDA 4, ,098 4, , % 2.6% 7.4% Consolidated AFFO 2, ,909 3, , % 2.8% 14.1% Consolidated AFFO per Share (4) $6.72 $0.02 $6.74 $7.30 $0.20 $ % 2.6% 11.3% Consolidated Organic Tenant Billings (5) 380 >5% ~2% >7% International Organic Tenant Billings (5) 145 ~2% ~5-6% >7% (1) As reported in the Company's Form 8-K dated July 31, (2) The Company s outlook is based on the following average foreign currency exchange rates to 1.00 U.S. Dollar for July 31, 2018 through December 31, 2018: (a) Argentinean Pesos; (b) 3.85 Brazilian Reais; (c) 645 Chilean Pesos; (d) 2,930 Colombian Pesos; (e) 0.86 Euros; (f) 4.75 Ghanaian Cedi; (g) Indian Rupees; (h) Mexican Pesos; (i) 360 Nigerian Naira; (j) 5,690 Paraguayan Guarani; (k) 3.30 Peruvian Soles; (l) South African Rand; and (m) 3,850 Ugandan Shillings. (3) Expected consolidation impacts include an anticipated decline of approximately $60 million in pass-through revenue. (4) Assumes 2018 weighted average diluted share count of million shares. (5) Reflects in-year impact associated with timing of anticipated churn. 34