(State or other jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) | |
Title of each Class | Trading Symbol(s) | Name of exchange on which registered |
☒ | Accelerated filer | ☐ | ||||
Non-accelerated filer | ☐ | Smaller reporting company | ||||
Emerging growth company | ||||||
Page Nos. | |||
PART I. FINANCIAL INFORMATION | |||
Item 1. | |||
Item 2. | |||
Item 3. | |||
Item 4. | |||
PART II. OTHER INFORMATION | |||
Item 1. | |||
Item 1A. | |||
Item 6. | |||
PART I. | FINANCIAL INFORMATION |
ITEM 1. | UNAUDITED CONSOLIDATED AND CONDENSED CONSOLIDATED FINANCIAL STATEMENTS |
September 30, 2019 | December 31, 2018 | |||||||
ASSETS | ||||||||
CURRENT ASSETS: | ||||||||
Cash and cash equivalents | $ | $ | ||||||
Restricted cash | ||||||||
Accounts receivable, net | ||||||||
Prepaid and other current assets | ||||||||
Total current assets | ||||||||
PROPERTY AND EQUIPMENT, net | ||||||||
GOODWILL | ||||||||
OTHER INTANGIBLE ASSETS, net | ||||||||
DEFERRED TAX ASSET | ||||||||
DEFERRED RENT ASSET | ||||||||
RIGHT-OF-USE ASSET | — | |||||||
NOTES RECEIVABLE AND OTHER NON-CURRENT ASSETS | ||||||||
TOTAL | $ | $ | ||||||
LIABILITIES | ||||||||
CURRENT LIABILITIES: | ||||||||
Accounts payable | $ | $ | ||||||
Accrued expenses | ||||||||
Distributions payable | ||||||||
Accrued interest | ||||||||
Current portion of operating lease liability | — | |||||||
Current portion of long-term obligations | ||||||||
Unearned revenue | ||||||||
Total current liabilities | ||||||||
LONG-TERM OBLIGATIONS | ||||||||
OPERATING LEASE LIABILITY | — | |||||||
ASSET RETIREMENT OBLIGATIONS | ||||||||
DEFERRED TAX LIABILITY | ||||||||
OTHER NON-CURRENT LIABILITIES | ||||||||
Total liabilities | ||||||||
COMMITMENTS AND CONTINGENCIES | ||||||||
REDEEMABLE NONCONTROLLING INTERESTS | ||||||||
EQUITY (shares in thousands): | ||||||||
Common stock: $.01 par value; 1,000,000 shares authorized; 453,392 and 451,617 shares issued; and 442,835 and 441,060 shares outstanding, respectively | ||||||||
Additional paid-in capital | ||||||||
Distributions in excess of earnings | ( | ) | ( | ) | ||||
Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
Treasury stock (10,557 shares at cost) | ( | ) | ( | ) | ||||
Total American Tower Corporation equity | ||||||||
Noncontrolling interests | ||||||||
Total equity | ||||||||
TOTAL | $ | $ | ||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
REVENUES: | ||||||||||||||||
Property | $ | $ | $ | $ | ||||||||||||
Services | ||||||||||||||||
Total operating revenues | ||||||||||||||||
OPERATING EXPENSES: | ||||||||||||||||
Costs of operations (exclusive of items shown separately below): | ||||||||||||||||
Property | ||||||||||||||||
Services | ||||||||||||||||
Depreciation, amortization and accretion | ||||||||||||||||
Selling, general, administrative and development expense | ||||||||||||||||
Other operating expenses | ||||||||||||||||
Total operating expenses | ||||||||||||||||
OPERATING INCOME | ||||||||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||||
Interest income (expense), TV Azteca | ( | ) | ||||||||||||||
Interest income | ||||||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Loss on retirement of long-term obligations | ( | ) | ||||||||||||||
Other income (including foreign currency (losses) gains of ($1.1), $2.2, $13.7 and ($14.9), respectively) | ||||||||||||||||
Total other expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | ||||||||||||||||
Income tax (provision) benefit | ( | ) | ( | ) | ( | ) | ||||||||||
NET INCOME | ||||||||||||||||
Net income attributable to noncontrolling interests | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
NET INCOME ATTRIBUTABLE TO AMERICAN TOWER CORPORATION STOCKHOLDERS | ||||||||||||||||
Dividends on preferred stock | ( | ) | ||||||||||||||
NET INCOME ATTRIBUTABLE TO AMERICAN TOWER CORPORATION COMMON STOCKHOLDERS | $ | $ | $ | $ | ||||||||||||
NET INCOME PER COMMON SHARE AMOUNTS: | ||||||||||||||||
Basic net income attributable to American Tower Corporation common stockholders | $ | $ | $ | $ | ||||||||||||
Diluted net income attributable to American Tower Corporation common stockholders | $ | $ | $ | $ | ||||||||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING (in thousands): | ||||||||||||||||
BASIC | ||||||||||||||||
DILUTED | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Net income | $ | $ | $ | $ | ||||||||||||
Other comprehensive income (loss): | ||||||||||||||||
Changes in fair value of cash flow hedges, each net of tax expense of $0 | ( | ) | ||||||||||||||
Reclassification of unrealized losses on cash flow hedges to net income, each net of tax expense of $0 | ||||||||||||||||
Adjustment to redeemable noncontrolling interest | ||||||||||||||||
Purchase of noncontrolling interest | ||||||||||||||||
Foreign currency translation adjustments, net of tax (benefit) expense of ($0.0), $1.0, $0.4 and ($2.8), respectively | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Other comprehensive loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Comprehensive income | ||||||||||||||||
Allocation of accumulated other comprehensive income resulting from purchase of redeemable noncontrolling interest | ( | ) | ||||||||||||||
Comprehensive loss attributable to noncontrolling interests | ||||||||||||||||
Comprehensive income attributable to American Tower Corporation stockholders | $ | $ | $ | $ | ||||||||||||
Nine Months Ended September 30, | ||||||||
2019 | 2018 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
Net income | $ | $ | ||||||
Adjustments to reconcile net income to cash provided by operating activities | ||||||||
Depreciation, amortization and accretion | ||||||||
Amortization of operating leases | ||||||||
Stock-based compensation expense | ||||||||
Loss on early retirement of long-term obligations | ||||||||
Other non-cash items reflected in statements of operations | ||||||||
Increase in net deferred rent balances | ( | ) | ( | ) | ||||
Reduction in operating lease liability | ( | ) | ||||||
Increase in assets | ( | ) | ( | ) | ||||
(Decrease) increase in liabilities | ( | ) | ||||||
Cash provided by operating activities | ||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
Payments for purchase of property and equipment and construction activities | ( | ) | ( | ) | ||||
Payments for acquisitions, net of cash acquired | ( | ) | ( | ) | ||||
Proceeds from sale of short-term investments and other non-current assets | ||||||||
Payments for short-term investments | ( | ) | ( | ) | ||||
Deposits and other | ( | ) | ( | ) | ||||
Cash used for investing activities | ( | ) | ( | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
Borrowings under credit facilities | ||||||||
Proceeds from issuance of senior notes, net | ||||||||
Proceeds from term loan | ||||||||
Proceeds from issuance of securities in securitization transaction | ||||||||
Repayments of notes payable, credit facilities, senior notes, secured debt, term loan, finance leases and capital leases | ( | ) | ( | ) | ||||
Distributions to noncontrolling interest holders, net | ( | ) | ( | ) | ||||
Purchases of common stock | ( | ) | ||||||
Proceeds from stock options and employee stock purchase plan | ||||||||
Distributions paid on common stock | ( | ) | ( | ) | ||||
Distributions paid on preferred stock | ( | ) | ||||||
Payment for early retirement of long-term obligations | ( | ) | ||||||
Deferred financing costs and other financing activities | ( | ) | ( | ) | ||||
Purchase of redeemable noncontrolling interest | ( | ) | ||||||
Purchase of noncontrolling interest | ( | ) | ||||||
Cash used for financing activities | ( | ) | ( | ) | ||||
Net effect of changes in foreign currency exchange rates on cash and cash equivalents, and restricted cash | ( | ) | ( | ) | ||||
NET INCREASE IN CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH | ||||||||
CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD | ||||||||
CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD | $ | $ | ||||||
CASH PAID FOR INCOME TAXES (NET OF REFUNDS OF $9.5 AND $24.9, RESPECTIVELY) | $ | $ | ||||||
CASH PAID FOR INTEREST | $ | $ | ||||||
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
Decrease in accounts payable and accrued expenses for purchases of property and equipment and construction activities | $ | ( | ) | $ | ( | ) | ||
Purchases of property and equipment under finance leases, perpetual easements and capital leases | $ | $ | ||||||
Acquisition of Commercialization Rights | $ | $ | ||||||
Common Stock | Treasury Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Distributions in Excess of Earnings | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||||||||
Three Months Ended September 30, 2018 and 2019 | Issued Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||
BALANCE, JULY 1, 2018 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||
Stock-based compensation related activity | — | — | — | — | — | |||||||||||||||||||||||||||||
Treasury stock activity | — | — | ( | ) | ( | ) | — | — | — | — | ( | ) | ||||||||||||||||||||||
Changes in fair value of cash flow hedges, net of tax | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Reclassification of unrealized losses on cash flow hedges to net income, net of tax | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Foreign currency translation adjustment, net of tax | — | — | — | — | — | ( | ) | — | ( | ) | ( | ) | ||||||||||||||||||||||
Distributions to noncontrolling interest | — | — | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||
Common stock distributions declared | — | — | — | — | — | — | ( | ) | — | ( | ) | |||||||||||||||||||||||
Net income | — | — | — | — | — | — | ||||||||||||||||||||||||||||
BALANCE, SEPTEMBER 30, 2018 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||
BALANCE, JULY 1, 2019 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||
Stock-based compensation related activity | — | — | — | — | — | |||||||||||||||||||||||||||||
Changes in fair value of cash flow hedges, net of tax | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Reclassification of unrealized losses on cash flow hedges to net income, net of tax | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Foreign currency translation adjustment, net of tax | — | — | — | — | — | ( | ) | — | ( | ) | ( | ) | ||||||||||||||||||||||
Contributions from noncontrolling interest | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Distributions to noncontrolling interest | — | — | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||
Common stock distributions declared | — | — | — | — | — | — | ( | ) | — | ( | ) | |||||||||||||||||||||||
Net income | — | — | — | — | — | — | ||||||||||||||||||||||||||||
BALANCE, SEPTEMBER 30, 2019 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||
Preferred Stock - Series B | Common Stock | Treasury Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Distributions in Excess of Earnings | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, 2018 and 2019 | Issued Shares | Amount | Issued Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||
BALANCE, JANUARY 1, 2018 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||||||||
Stock-based compensation related activity | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Issuance of common stock- stock purchase plan | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Conversion of preferred stock | ( | ) | ( | ) | — | — | ( | ) | — | — | — | ||||||||||||||||||||||||||||||
Treasury stock activity | — | — | — | — | ( | ) | ( | ) | — | — | — | — | ( | ) | |||||||||||||||||||||||||||
Changes in fair value of cash flow hedges, net of tax | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Reclassification of unrealized losses on cash flow hedges to net income, net of tax | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Foreign currency translation adjustment, net of tax | — | — | — | — | — | — | — | ( | ) | — | ( | ) | ( | ) | |||||||||||||||||||||||||||
Adjustment to redeemable noncontrolling interest | — | — | — | — | — | — | ( | ) | — | — | |||||||||||||||||||||||||||||||
Distributions to noncontrolling interest | — | — | — | — | — | — | — | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Purchase of noncontrolling interest | — | — | — | — | — | — | ( | ) | — | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Impact of revenue recognition standard adoption | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Common stock distributions declared | — | — | — | — | — | — | — | — | ( | ) | — | ( | ) | ||||||||||||||||||||||||||||
Preferred stock dividends declared | — | — | — | — | — | — | — | — | ( | ) | — | ( | ) | ||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||
BALANCE, SEPTEMBER 30, 2018 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||||||||
BALANCE, JANUARY 1, 2019 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||||||||
Stock-based compensation related activity | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Issuance of common stock- stock purchase plan | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Changes in fair value of cash flow hedges, net of tax | — | — | — | — | — | — | — | ( | ) | — | — | ( | ) | ||||||||||||||||||||||||||||
Reclassification of unrealized losses on cash flow hedges to net income, net of tax | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Foreign currency translation adjustment, net of tax | — | — | — | — | — | — | — | ( | ) | — | ( | ) | ( | ) | |||||||||||||||||||||||||||
Contributions from noncontrolling interest | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Distributions to noncontrolling interest | — | — | — | — | — | — | — | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||||
Purchase of redeemable noncontrolling interest | — | — | — | — | — | — | ( | ) | — | — | |||||||||||||||||||||||||||||||
Impact of lease accounting standard adoption | — | — | — | — | — | — | — | — | ( | ) | — | ( | ) | ||||||||||||||||||||||||||||
Common stock distributions declared | — | — | — | — | — | — | — | — | ( | ) | — | ( | ) | ||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||
BALANCE, SEPTEMBER 30, 2019 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||||||||||||||
1. | BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES |
Nine Months Ended September 30, | |||||||
2019 | 2018 | ||||||
Cash and cash equivalents | $ | $ | |||||
Restricted cash | |||||||
Total cash and cash equivalents and restricted cash | $ | $ | |||||
Three Months Ended September 30, 2019 | U.S. | Asia | EMEA | Latin America | Total | |||||||||||||||
Non-lease property revenue | $ | $ | $ | $ | $ | |||||||||||||||
Services revenue | ||||||||||||||||||||
Total non-lease revenue | $ | $ | $ | $ | $ | |||||||||||||||
Property lease revenue | ||||||||||||||||||||
Total revenue | $ | $ | $ | $ | $ | |||||||||||||||
Three Months Ended September 30, 2018 (1) | U.S. | Asia | EMEA | Latin America | Total | |||||||||||||||
Non-lease property revenue | $ | $ | $ | $ | $ | |||||||||||||||
Services revenue | ||||||||||||||||||||
Total non-lease revenue | $ | $ | $ | $ | $ | |||||||||||||||
Property lease revenue | ||||||||||||||||||||
Total revenue | $ | $ | $ | $ | $ | |||||||||||||||
(1) | Prior-period amounts adjusted with the adoption of the new lease accounting guidance, as applicable. |
Nine Months Ended September 30, 2019 | U.S. | Asia | EMEA | Latin America | Total | |||||||||||||||
Non-lease property revenue | $ | $ | $ | $ | $ | |||||||||||||||
Services revenue | ||||||||||||||||||||
Total non-lease revenue | $ | $ | $ | $ | $ | |||||||||||||||
Property lease revenue | ||||||||||||||||||||
Total revenue | $ | $ | $ | $ | $ | |||||||||||||||
Nine Months Ended September 30, 2018 (1) | U.S. | Asia | EMEA | Latin America | Total | |||||||||||||||
Non-lease property revenue | $ | $ | $ | $ | $ | |||||||||||||||
Services revenue | ||||||||||||||||||||
Total non-lease revenue | $ | $ | $ | $ | $ | |||||||||||||||
Property lease revenue | ||||||||||||||||||||
Total revenue | $ | $ | $ | $ | $ | |||||||||||||||
(1) |
September 30, 2019 | December 31, 2018 (1) | |||||||
Accounts receivable | $ | $ | ||||||
Prepaids and other current assets | ||||||||
Notes receivable and other non-current assets | ||||||||
Unearned revenue (2) | ||||||||
Other non-current liabilities (3) | ||||||||
(1) | Prior-period amounts adjusted with the adoption of the new lease accounting guidance, as applicable. |
(2) | Excludes $ |
(3) | Excludes $ |
As of | |||||||
September 30, 2019 | December 31, 2018 | ||||||
Unbilled receivables | $ | $ | |||||
Prepaid income tax | |||||||
Value added tax and other consumption tax receivables | |||||||
Prepaid assets | |||||||
Prepaid operating ground leases | |||||||
Other miscellaneous current assets | |||||||
Prepaids and other current assets | $ | $ | |||||
Estimated Useful Lives (years) (1) | As of | ||||||||
September 30, 2019 | December 31, 2018 | ||||||||
Towers | Up to 20 | $ | $ | ||||||
Equipment (2) | 2 - 20 | ||||||||
Buildings and improvements | 3 - 32 | ||||||||
Land and improvements (3) | Up to 20 | ||||||||
Construction-in-progress | |||||||||
Total | |||||||||
Less accumulated depreciation | ( | ) | ( | ) | |||||
Property and equipment, net | $ | $ | |||||||
(1) | Assets on leased land are depreciated over the shorter of the estimated useful life of the asset or the term of the corresponding ground lease taking into consideration lease renewal options and residual value. |
(2) | Includes fiber and DAS assets. |
(3) | Estimated useful lives apply to improvements only. |
As of | ||||||
Finance leases: | Classification | September 30, 2019 | ||||
Property and equipment | Towers | $ | ||||
Accumulated depreciation | ( | ) | ||||
Property and equipment, net | $ | |||||
Property and equipment | Buildings and improvements | $ | ||||
Accumulated depreciation | ( | ) | ||||
Property and equipment, net | $ | |||||
Property and equipment | Land | $ | ||||
Property and equipment | Equipment | $ | ||||
Accumulated depreciation | ( | ) | ||||
Property and equipment, net | $ | |||||
Fiscal Year | Amount (1) | |||
Remainder of 2019 | $ | |||
2020 | ||||
2021 | ||||
2022 | ||||
2023 | ||||
Thereafter | ||||
Total | $ | |||
(1) | Balances are translated at the applicable period-end exchange rate, which may impact comparability between periods. |
Year Ended December 31, | Amount (1) | |||
2019 | $ | |||
2020 | ||||
2021 | ||||
2022 | ||||
2023 | ||||
Thereafter | ||||
Total | $ | |||
(1) | Balances are translated at the applicable period-end exchange rate, which may impact comparability between periods. |
Operating leases: | ||||
Right-of-use asset | $ | |||
Current portion of lease liability | $ | |||
Lease liability | ||||
Total operating lease liability | $ | |||
Finance leases: | ||||
Current portion of lease liability | $ | |||
Lease liability | ||||
Total finance lease liability | $ | |||
Operating leases: | |||
Weighted-average remaining lease term (years) | |||
Weighted-average incremental borrowing rate | % | ||
Finance leases: | |||
Weighted-average remaining lease term (years) | |||
Weighted-average incremental borrowing rate | % | ||
Three Months Ended September 30, 2019 | Nine Months Ended September 30, 2019 | |||||||
Operating lease cost | $ | $ | ||||||
Variable lease costs not included in lease liability (1) | ||||||||
(1) | Includes property tax paid on behalf of the landlord. |
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flows from operating leases | $ | ( | ) | |
Operating cash flows from finance leases | $ | ( | ) | |
Financing cash flows from finance leases | $ | ( | ) | |
Non-cash items: | ||||
New operating leases | $ | |||
Operating lease modifications and reassessments | $ | |||
Fiscal Year | Operating Lease (1) | Finance Lease (1) | ||||||
Remainder of 2019 | $ | $ | ||||||
2020 | ||||||||
2021 | ||||||||
2022 | ||||||||
2023 | ||||||||
Thereafter | ||||||||
Total lease payments | ||||||||
Less amounts representing interest | ( | ) | ( | ) | ||||
Total lease liability | ||||||||
Less current portion of lease liability | ( | ) | ( | ) | ||||
Non-current lease liability | $ | $ | ||||||
(1) | Balances are translated at the applicable period-end exchange rate, which may impact comparability between periods. |
Year Ended December 31, | Amount (1) | |||
2019 | $ | |||
2020 | ||||
2021 | ||||
2022 | ||||
2023 | ||||
Thereafter | ||||
Total | $ | |||
(1) | Balances are translated at the applicable period-end exchange rate, which may impact comparability between periods. |
Year Ended December 31, | Amount (1) | |||
2019 | $ | |||
2020 | ||||
2021 | ||||
2022 | ||||
2023 | ||||
Thereafter | ||||
Total | ||||
Less amounts representing interest | ( | ) | ||
Present value of capital lease obligations | $ | |||
(1) | Balances are translated at the applicable period-end exchange rate, which may impact comparability between periods. |
Property | Services | Total | ||||||||||||||||||||||
U.S. | Asia | EMEA | Latin America | |||||||||||||||||||||
Balance as of January 1, 2019 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
Additions and adjustments (1) | ||||||||||||||||||||||||
Effect of foreign currency translation | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
Balance as of September 30, 2019 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
(1) | Additions consist of $ |
As of September 30, 2019 | As of December 31, 2018 | ||||||||||||||||||||||||
Estimated Useful Lives (years) | Gross Carrying Value | Accumulated Amortization | Net Book Value | Gross Carrying Value | Accumulated Amortization | Net Book Value | |||||||||||||||||||
Acquired network location intangibles (1) | Up to 20 | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ||||||||||||||
Acquired tenant-related intangibles | 15-20 | ( | ) | ( | ) | ||||||||||||||||||||
Acquired licenses and other intangibles | 3-20 | ( | ) | ( | ) | ||||||||||||||||||||
Total other intangible assets | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | |||||||||||||||
(1) | Acquired network location intangibles are amortized over the shorter of the term of the corresponding ground lease, taking into consideration lease renewal options and residual value, or up to |
Fiscal Year | Amount | |||
Remainder of 2019 | $ | |||
2020 | ||||
2021 | ||||
2022 | ||||
2023 | ||||
2024 | ||||
As of | |||||||
September 30, 2019 | December 31, 2018 | ||||||
Long-term prepaid ground rent | $ | $ | |||||
Notes receivable | |||||||
Other miscellaneous assets | |||||||
Notes receivable and other non-current assets | $ | $ | |||||
As of | |||||||
September 30, 2019 | December 31, 2018 | ||||||
Accrued property and real estate taxes | $ | $ | |||||
Accrued pass-through costs | |||||||
Amounts payable to tenants | |||||||
Accrued rent | |||||||
Payroll and related withholdings | |||||||
Accrued construction costs | |||||||
Accrued income tax payable | |||||||
Accrued pass-through taxes | |||||||
Other accrued expenses | |||||||
Total accrued expenses | $ | $ | |||||
As of | |||||||||
September 30, 2019 | December 31, 2018 | Maturity Date | |||||||
2018 Term Loan (1) (2) | $ | $ | March 29, 2019 | ||||||
2019 Term Loan (1) | February 13, 2020 | ||||||||
2013 Credit Facility (1) | June 28, 2022 | ||||||||
2013 Term Loan (1) | January 31, 2024 | ||||||||
2014 Credit Facility (1) | January 31, 2024 | ||||||||
3.40% senior notes (3) | February 15, 2019 | ||||||||
2.800% senior notes | June 1, 2020 | ||||||||
5.050% senior notes (4) | September 1, 2020 | ||||||||
3.300% senior notes | February 15, 2021 | ||||||||
3.450% senior notes | September 15, 2021 | ||||||||
5.900% senior notes | November 1, 2021 | ||||||||
2.250% senior notes | January 15, 2022 | ||||||||
4.70% senior notes | March 15, 2022 | ||||||||
3.50% senior notes | January 31, 2023 | ||||||||
3.000% senior notes | June 15, 2023 | ||||||||
5.00% senior notes | February 15, 2024 | ||||||||
3.375% senior notes | May 15, 2024 | ||||||||
2.950% senior notes | January 15, 2025 | ||||||||
1.375% senior notes | April 4, 2025 | ||||||||
4.000% senior notes | June 1, 2025 | ||||||||
4.400% senior notes | February 15, 2026 | ||||||||
1.950% senior notes | May 22, 2026 | ||||||||
3.375% senior notes | October 15, 2026 | ||||||||
3.125% senior notes | January 15, 2027 | ||||||||
3.55% senior notes | July 15, 2027 | ||||||||
3.600% senior notes | January 15, 2028 | ||||||||
3.950% senior notes | March 15, 2029 | ||||||||
3.800% senior notes | August 15, 2029 | ||||||||
Total American Tower Corporation debt | |||||||||
Series 2013-2A securities (5) | March 15, 2023 | ||||||||
Series 2018-1A securities (5) | March 15, 2028 | ||||||||
Series 2015-1 notes (6) | June 15, 2020 | ||||||||
Series 2015-2 notes (7) | June 16, 2025 | ||||||||
India indebtedness (8) | Various | ||||||||
India preference shares (9) | March 2, 2020 | ||||||||
Shareholder loan (10) | December 31, 2019 | ||||||||
Other subsidiary debt (11) | Various | ||||||||
Total American Tower subsidiary debt | |||||||||
Finance and capital lease obligations | |||||||||
Total | |||||||||
Less current portion of long-term obligations | ( | ) | ( | ) | |||||
Long-term obligations | $ | $ | |||||||
(1) | Accrues interest at a variable rate. |
(2) | Repaid in full on February 14, 2019 using proceeds from the 2019 Term Loan (as defined below) and cash on hand. |
(3) | Repaid in full on the maturity date in February 2019 with borrowings from the 2013 Credit Facility and the 2014 Credit Facility (each as defined below). |
(4) | Repaid in full on April 22, 2019 with borrowings from the 2014 Credit Facility and cash on hand. |
(5) | Maturity date reflects the anticipated repayment date; final legal maturity is March 15, 2048. |
(6) | Maturity date reflects the anticipated repayment date; final legal maturity is June 15, 2045. |
(7) | Maturity date reflects the anticipated repayment date; final legal maturity is June 15, 2050. |
(8) | Denominated in Indian Rupees (“INR”). Included India working capital facilities, remaining debt assumed by the Company in connection with the Viom Acquisition (as defined in note 12) and debt that had been entered into by ATC TIPL. During the three months ended March 31, 2019, the Company repaid all remaining debt assumed in connection with the Viom Acquisition and debt entered into by ATC TIPL. |
(9) | Mandatorily redeemable preference shares (the “Preference Shares”) denominated in INR and classified as debt. The Preference Shares were redeemed on March 2, 2019. |
(10) | Reflects balance owed to the Company’s joint venture partner in Ghana. The Ghana loan is denominated in Ghanaian Cedi (“GHS”). On June 14, 2019, the Company purchased the remaining |
(11) |
Outstanding Principal Balance (in millions) | Undrawn letters of credit (in millions) | Maturity Date | Current margin over LIBOR (1) | Current commitment fee (2) | |||||||||||
2013 Credit Facility | $ | $ | June 28, 2022 | (3) | % | % | |||||||||
2014 Credit Facility | $ | $ | January 31, 2024 | (3) | % | % | |||||||||
2013 Term Loan | $ | N/A | January 31, 2024 | % | N/A | ||||||||||
2019 Term Loan | $ | N/A | February 13, 2020 | % | N/A | ||||||||||
Level 1 | Quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. | |
Level 2 | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |
Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | |
September 30, 2019 | December 31, 2018 | |||||||||||||||||||||||
Fair Value Measurements Using | Fair Value Measurements Using | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Interest rate swap agreements | $ | |||||||||||||||||||||||
Embedded derivative in lease agreement | $ | $ | ||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||
Interest rate swap agreements | $ | $ | ||||||||||||||||||||||
Acquisition-related contingent consideration | $ | $ | ||||||||||||||||||||||
Fair value of debt related to interest rate swap agreements (1) | $ | $ | ( | ) | ||||||||||||||||||||
Redeemable noncontrolling interests | $ | $ | ||||||||||||||||||||||
(1) | Included in the carrying values of the corresponding debt obligations. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Penalties and income tax-related interest expense | $ | $ | $ | $ | |||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Stock-based compensation expense Property | $ | $ | $ | $ | ||||||||||||
Stock-based compensation expense Services | ||||||||||||||||
Stock-based compensation expense SG&A | ||||||||||||||||
Total stock-based compensation expense | $ | $ | $ | $ | ||||||||||||
Stock-based compensation expense capitalized as property and equipment | $ | $ | $ | $ | ||||||||||||
Number of Options | |||
Outstanding as of January 1, 2019 | |||
Granted | |||
Exercised | ( | ) | |
Forfeited | ( | ) | |
Expired | |||
Outstanding as of September 30, 2019 | |||
RSUs | PSUs | ||||
Outstanding as of January 1, 2019 (1) | |||||
Granted (2) | |||||
Vested and Released (3) | ( | ) | ( | ) | |
Forfeited | ( | ) | |||
Outstanding as of September 30, 2019 | |||||
Vested and deferred as of September 30, 2019 (4) | |||||
(1) | PSUs consist of the target number of shares issuable at the end of the three-year performance period for the 2018 PSUs and 2017 PSUs, or |
(2) | PSUs consist of the target number of shares issuable at the end of the three-year performance period for the 2019 PSUs, or |
(3) | This includes |
(4) | Vested and deferred RSUs are related to deferred compensation for certain former employees. |
2019 | 2018 | |||||||
Balance as of January 1, | $ | $ | ||||||
Net income (loss) attributable to noncontrolling interests | ( | ) | ||||||
Adjustment to noncontrolling interest redemption value | ( | ) | ||||||
Adjustment to noncontrolling interest due to merger | ( | ) | ||||||
Purchase of redeemable noncontrolling interest | ( | ) | ||||||
Foreign currency translation adjustment attributable to noncontrolling interests | ( | ) | ( | ) | ||||
Balance as of September 30, | $ | $ | ||||||
Declaration Date | Payment Date | Record Date | Distribution per share | Aggregate Payment Amount (1) | ||||||||
Common Stock | ||||||||||||
September 13, 2019 | October 17, 2019 | September 27, 2019 | $ | $ | ||||||||
May 22, 2019 | July 12, 2019 | June 19, 2019 | $ | $ | ||||||||
March 7, 2019 | April 26, 2019 | April 11, 2019 | $ | $ | ||||||||
December 5, 2018 | January 14, 2019 | December 27, 2018 | $ | $ | ||||||||
(1) | Does not include amounts accrued for distributions payable related to unvested restricted stock units. |
Declaration Date | Payment Date | Record Date | Distribution per share | Aggregate Payment Amount (1) | ||||||||
Common Stock | ||||||||||||
September 6, 2018 | October 17, 2018 | September 28, 2018 | $ | $ | ||||||||
May 24, 2018 | July 13, 2018 | June 19, 2018 | $ | $ | ||||||||
March 8, 2018 | April 27, 2018 | April 11, 2018 | $ | $ | ||||||||
December 6, 2017 | January 16, 2018 | December 28, 2017 | $ | $ | ||||||||
Series B Preferred Stock | ||||||||||||
January 22, 2018 | February 15, 2018 | February 1, 2018 | $ | $ | ||||||||
(1) | Does not include amounts accrued for distributions payable related to unvested restricted stock units. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net income attributable to American Tower Corporation stockholders | $ | $ | $ | $ | |||||||||||
Dividends on preferred stock | ( | ) | |||||||||||||
Net income attributable to American Tower Corporation common stockholders | $ | $ | $ | $ | |||||||||||
Basic weighted average common shares outstanding | |||||||||||||||
Dilutive securities | |||||||||||||||
Diluted weighted average common shares outstanding | |||||||||||||||
Basic net income attributable to American Tower Corporation common stockholders per common share | $ | $ | $ | $ | |||||||||||
Diluted net income attributable to American Tower Corporation common stockholders per common share | $ | $ | $ | $ | |||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||
Restricted stock units | |||||||||||
Preferred stock | |||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Acquisition and merger related expenses | $ | $ | $ | $ | ||||||||||||
Integration costs | $ | $ | $ | $ | ||||||||||||
U.S. Acquisition | Other (1) | |||||||
Current assets | $ | $ | ||||||
Property and equipment | ||||||||
Intangible assets (2): | ||||||||
Tenant-related intangible assets | ||||||||
Network location intangible assets | ||||||||
Other intangible assets | ||||||||
Other non-current assets | ||||||||
Current liabilities | ( | ) | ( | ) | ||||
Deferred tax liability | ||||||||
Other non-current liabilities | ( | ) | ( | ) | ||||
Net assets acquired | ||||||||
Goodwill (3) | ||||||||
Fair value of net assets acquired | ||||||||
Debt assumed | ||||||||
Purchase price | $ | $ | ||||||
(1) | Includes |
(2) | Tenant-related intangible assets and network location intangible assets are amortized on a straight-line basis over periods of up to |
(3) |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Pro forma revenues | $ | $ | $ | $ | ||||||||||||
Pro forma net income attributable to American Tower Corporation common stockholders | $ | $ | $ | $ | ||||||||||||
Pro forma net income per common share amounts: | ||||||||||||||||
Basic net income attributable to American Tower Corporation common stockholders | $ | $ | $ | $ | ||||||||||||
Diluted net income attributable to American Tower Corporation common stockholders | $ | $ | $ | $ | ||||||||||||
• | U.S.: property operations in the United States; |
• | Asia: property operations in India; |
• | Europe, Middle East and Africa (“EMEA”): property operations in France, Germany, Ghana, Kenya, Nigeria, South Africa and Uganda; and |
• | Latin America: property operations in Argentina, Brazil, Chile, Colombia, Costa Rica, Mexico, Paraguay and Peru. |
Property | Total Property | Services | Other | Total | ||||||||||||||||||||||||||||
Three Months Ended September 30, 2019 | U.S. | Asia | EMEA | Latin America | ||||||||||||||||||||||||||||
Segment revenues | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||
Segment operating expenses (1) | ||||||||||||||||||||||||||||||||
Segment gross margin | ||||||||||||||||||||||||||||||||
Segment selling, general, administrative and development expense (1) | ||||||||||||||||||||||||||||||||
Segment operating profit | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||
Stock-based compensation expense | $ | |||||||||||||||||||||||||||||||
Other selling, general, administrative and development expense | ||||||||||||||||||||||||||||||||
Depreciation, amortization and accretion | ||||||||||||||||||||||||||||||||
Other expense (2) | ||||||||||||||||||||||||||||||||
Income from continuing operations before income taxes | $ | |||||||||||||||||||||||||||||||
Total assets | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
(1) | Segment operating expenses and segment selling, general, administrative and development expenses exclude stock-based compensation expense of $ |
(2) | Primarily includes interest expense and $ |
Property | Total Property | Services | Other | Total | ||||||||||||||||||||||||||||
Three Months Ended September 30, 2018 | U.S. | Asia | EMEA | Latin America | ||||||||||||||||||||||||||||
Segment revenues | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||
Segment operating expenses (1) | ||||||||||||||||||||||||||||||||
Interest income, TV Azteca, net | ||||||||||||||||||||||||||||||||
Segment gross margin | ||||||||||||||||||||||||||||||||
Segment selling, general, administrative and development expense (1) | ||||||||||||||||||||||||||||||||
Segment operating profit | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||
Stock-based compensation expense | $ | |||||||||||||||||||||||||||||||
Other selling, general, administrative and development expense | ||||||||||||||||||||||||||||||||
Depreciation, amortization and accretion | ||||||||||||||||||||||||||||||||
Other expense (2) | ||||||||||||||||||||||||||||||||
Income from continuing operations before income taxes | $ | |||||||||||||||||||||||||||||||
Total assets | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
(1) | Segment operating expenses and segment selling, general, administrative and development expenses exclude stock-based compensation expense of $ |
(2) | Primarily includes interest expense and $ |
Property | Total Property | Services | Other | Total | ||||||||||||||||||||||||||||
Nine Months Ended September 30, 2019 | U.S. | Asia | EMEA | Latin America | ||||||||||||||||||||||||||||
Segment revenues | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||
Segment operating expenses (1) | ||||||||||||||||||||||||||||||||
Segment gross margin | ||||||||||||||||||||||||||||||||
Segment selling, general, administrative and development expense (1) | ||||||||||||||||||||||||||||||||
Segment operating profit | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||
Stock-based compensation expense | $ | |||||||||||||||||||||||||||||||
Other selling, general, administrative and development expense | ||||||||||||||||||||||||||||||||
Depreciation, amortization and accretion | ||||||||||||||||||||||||||||||||
Other expense (2) | ||||||||||||||||||||||||||||||||
Income from continuing operations before income taxes | $ | |||||||||||||||||||||||||||||||
(1) | Segment operating expenses and segment selling, general, administrative and development expenses exclude stock-based compensation expense of $ |
(2) | Primarily includes interest expense and $ |
Property | Total Property | Services | Other | Total | ||||||||||||||||||||||||||||
Nine Months Ended September 30, 2018 | U.S. | Asia | EMEA | Latin America | ||||||||||||||||||||||||||||
Segment revenues | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||
Segment operating expenses (1) | ||||||||||||||||||||||||||||||||
Interest expense, TV Azteca, net | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
Segment gross margin | ||||||||||||||||||||||||||||||||
Segment selling, general, administrative and development expense (1) | ||||||||||||||||||||||||||||||||
Segment operating profit | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||
Stock-based compensation expense | $ | |||||||||||||||||||||||||||||||
Other selling, general, administrative and development expense | ||||||||||||||||||||||||||||||||
Depreciation, amortization and accretion | ||||||||||||||||||||||||||||||||
Other expense (2) | ||||||||||||||||||||||||||||||||
Income from continuing operations before income taxes | $ | |||||||||||||||||||||||||||||||
(1) | Segment operating expenses and segment selling, general, administrative and development expenses exclude stock-based compensation expense of $ |
(2) | Primarily includes interest expense and $ |
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Number of Owned Towers | Number of Operated Towers (1) | Number of Owned DAS Sites | |||||||
U.S. | 24,942 | 15,641 | 405 | ||||||
Asia: | |||||||||
India (2) | 73,984 | — | 1,089 | ||||||
EMEA: | |||||||||
France | 2,188 | 317 | 9 | ||||||
Germany | 2,210 | — | — | ||||||
Ghana | 2,341 | — | 25 | ||||||
Kenya | 716 | — | — | ||||||
Nigeria | 4,995 | — | — | ||||||
South Africa (2) | 2,679 | — | — | ||||||
Uganda | 1,593 | — | 1 | ||||||
EMEA total | 16,722 | 317 | 35 | ||||||
Latin America: | |||||||||
Argentina (3) | 61 | — | 10 | ||||||
Brazil (3) | 16,679 | 2,259 | 98 | ||||||
Chile | 1,307 | — | 21 | ||||||
Colombia | 4,998 | — | 2 | ||||||
Costa Rica | 617 | — | 2 | ||||||
Mexico (4) | 9,345 | 186 | 92 | ||||||
Paraguay | 1,421 | — | — | ||||||
Peru | 703 | 378 | — | ||||||
Latin America total | 35,131 | 2,823 | 225 | ||||||
(1) | Approximately 98% of the operated towers are held pursuant to long-term finance leases, including those subject to purchase options. |
(2) | In India and South Africa, we also own fiber. |
(3) | In Argentina and Brazil, we also own or operate urban telecommunications assets, fiber and the rights to utilize certain existing utility infrastructure for future telecommunications equipment installation. |
(4) | In Mexico, we also own or operate urban telecommunications assets, including fiber, concrete poles and other infrastructure. |
Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | |||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||
Property | ||||||||||||||||||||||
U.S. | $ | 1,095.9 | $ | 957.7 | 14 | % | $ | 3,089.4 | $ | 2,846.1 | 9 | % | ||||||||||
Asia | 312.5 | 323.1 | (3 | ) | 922.5 | 904.0 | 2 | |||||||||||||||
EMEA | 181.5 | 166.6 | 9 | 534.0 | 507.5 | 5 | ||||||||||||||||
Latin America | 331.7 | 304.2 | 9 | 1,010.6 | 953.8 | 6 | ||||||||||||||||
Total property | 1,921.6 | 1,751.6 | 10 | 5,556.5 | 5,211.4 | 7 | ||||||||||||||||
Services | 32.0 | 33.9 | (6 | ) | 100.1 | 96.8 | 3 | |||||||||||||||
Total revenues | $ | 1,953.6 | $ | 1,785.5 | 9 | % | $ | 5,656.6 | $ | 5,308.2 | 7 | % | ||||||||||
• | Tenant billings growth of $69.1 million, which was driven by: |
• | $51.7 million due to leasing additional space on our sites (“colocations”) and amendments; |
• | $14.9 million from contractual escalations, net of churn; and |
• | $4.4 million generated from sites acquired or constructed since the beginning of the prior-year period (“newly acquired or constructed sites”); |
• | Partially offset by a decrease of $1.9 million from other tenant billings; and |
• | An increase of $69.1 million in other revenue, which includes a $63.6 million increase due to straight-line accounting primarily due to a new master lease agreement with one of our tenants, AT&T Inc. (“AT&T”). |
• | A decrease in tenant billings of $33.5 million, which was driven by: |
• | A decrease of $57.6 million resulting from churn in excess of contractual escalations, including $55.5 million of carrier consolidation-driven churn in India; |
• | Partially offset by: |
▪ | $19.0 million due to colocations and amendments; |
▪ | $4.6 million generated from newly acquired or constructed sites; and |
▪ | $0.5 million from other tenant billings; |
• | An increase of $23.4 million in other revenue, primarily due to tenant settlement payments attributable to prior tenant cancellations; and |
• | Pass-through revenue growth of $2.4 million. |
• | Tenant billings growth of $16.8 million, which was driven by: |
• | $6.8 million generated from newly acquired or constructed sites, primarily due to the acquisition of communications sites in Kenya in the fourth quarter of 2018 (the “Kenya Acquisition”); |
• | $4.5 million due to colocations and amendments; |
• | $3.3 million from contractual escalations, net of churn; and |
• | $2.2 million from other tenant billings; |
• | An increase in pass-through revenue of $5.9 million; and |
• | A decrease of $0.3 million in other revenue. |
• | Tenant billings growth of $19.7 million, which was driven by: |
• | $11.5 million due to colocations and amendments; |
• | $3.9 million generated from newly acquired or constructed sites; |
• | $3.5 million from contractual escalations, net of churn; and |
• | $0.8 million from other tenant billings; |
• | An increase of $10.6 million in other revenue, primarily due to our fiber business in Brazil acquired in the fourth quarter of 2018; and |
• | Pass-through revenue growth of $5.4 million. |
• | Tenant billings growth of $213.2 million, which was driven by: |
• | $160.7 million due to colocations and amendments; |
• | $48.1 million from contractual escalations, net of churn; and |
• | $8.6 million generated from newly acquired or constructed sites; |
• | Partially offset by a decrease of $4.2 million from other tenant billings; and |
• | An increase of $30.1 million in other revenue, which includes a $26.2 million increase due to straight-line accounting primarily due to a new master lease agreement with AT&T. |
• | An increase of $64.9 million in other revenue, primarily due to tenant settlement payments attributable to prior tenant cancellations; |
• | Pass-through revenue growth of $57.9 million; and |
• | A decrease in tenant billings of $60.1 million, which was driven by: |
• | A decrease of $185.8 million resulting from churn in excess of contractual escalations, including $186.1 million of carrier consolidation-driven churn in India; |
• | Partially offset by: |
▪ | $70.2 million generated from newly acquired or constructed sites, including $59.5 million from the transactions with Vodafone India Limited and Vodafone Mobile Services Limited (the “Vodafone Acquisition”) and Idea Cellular Limited (the “Idea Acquisition”); |
▪ | $53.8 million due to colocations and amendments; and |
▪ | $1.7 million from other tenant billings. |
• | Tenant billings growth of $48.0 million, which was driven by: |
• | $20.2 million generated from newly acquired or constructed sites, primarily due to the Kenya Acquisition; |
• | $13.7 million due to colocations and amendments; |
• | $9.1 million from contractual escalations, net of churn; and |
• | $5.0 million from other tenant billings; |
• | Pass-through revenue growth of $11.7 million; and |
• | A decrease of $0.5 million in other revenue. |
• | Tenant billings growth of $60.2 million, which was driven by: |
• | $32.4 million due to colocations and amendments; |
• | $12.5 million from contractual escalations, net of churn; |
• | $11.2 million generated from newly acquired or constructed sites; and |
• | $4.1 million from other tenant billings; |
• | An increase of $39.9 million in other revenue, primarily due to $25.0 million from our fiber business in Brazil acquired in the fourth quarter of 2018 and an $11.6 million tenant settlement payment in Mexico, as well as an increase due to straight-line accounting, partially offset by revenue reserves; and |
• | Pass-through revenue growth of $15.8 million. |
Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | |||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||
Property | ||||||||||||||||||||||
U.S. | $ | 888.4 | $ | 764.4 | 16 | % | $ | 2,494.0 | $ | 2,267.7 | 10 | % | ||||||||||
Asia | 134.6 | 128.4 | 5 | 378.3 | 371.3 | 2 | ||||||||||||||||
EMEA | 122.9 | 109.1 | 13 | 355.1 | 332.4 | 7 | ||||||||||||||||
Latin America | 228.1 | 208.0 | 10 | 700.1 | 644.2 | 9 | ||||||||||||||||
Total property | 1,374.0 | 1,209.9 | 14 | 3,927.5 | 3,615.6 | 9 | ||||||||||||||||
Services | 20.3 | 20.5 | (1 | )% | 64.6 | 58.3 | 11 | % | ||||||||||||||
• | The increase in U.S. property segment gross margin was primarily attributable to the increase in revenue described above, partially offset by an increase in direct expenses of $14.2 million. |
• | The increase in Asia property segment gross margin was primarily attributable to a decrease in direct expenses of $15.0 million as a result of lower utility costs and a benefit of $1.8 million attributable to the impact of foreign currency translation on direct expenses, partially offset by the decrease in revenue described above. |
• | The increase in EMEA property segment gross margin was primarily attributable to the increase in revenue described above and a benefit of $2.0 million attributable to the impact of foreign currency translation on direct expenses, partially offset by an increase in direct expenses of $3.1 million, primarily due to the Kenya Acquisition. |
• | The increase in Latin America property segment gross margin was primarily attributable to the increase in revenue described above and a benefit of $3.0 million attributable to the impact of foreign currency translation on direct expenses, partially offset by an increase in direct expenses of $9.8 million, including those costs related to our fiber business in Brazil, and a reduction of $0.6 million in interest income related to TV Azteca, S.A. de C.V. (“TV Azteca”). |
• | The decrease in services segment gross margin was primarily due to the decrease in revenue described above, partially offset by a decrease in direct expenses of $1.7 million. |
• | The increase in U.S. property segment gross margin was primarily attributable to the increase in revenue described above, partially offset by an increase in direct expenses of $17.0 million. |
• | The increase in Asia property segment gross margin was primarily attributable to a benefit of $26.8 million attributable to the impact of foreign currency translation on direct expenses and the increase in revenue described above, partially offset by an increase in direct expenses of $38.3 million, primarily due to the Vodafone Acquisition and the Idea Acquisition. |
• | The increase in EMEA property segment gross margin was primarily attributable to the increase in revenue described above and a benefit of $10.3 million attributable to the impact of foreign currency translation on direct expenses, partially offset by an increase in direct expenses of $14.1 million, primarily due to the Kenya Acquisition. |
• | The increase in Latin America property segment gross margin was primarily attributable to the increase in revenue described above, a benefit of $20.7 million attributable to the impact of foreign currency translation on |
• | The increase in services segment gross margin was primarily due to the increase in revenue described above and a decrease in direct expenses of $3.0 million. |
Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | |||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||
Property | ||||||||||||||||||||||
U.S. | $ | 44.5 | $ | 37.9 | 17 | % | $ | 128.4 | $ | 117.1 | 10 | % | ||||||||||
Asia | 33.1 | 13.5 | 145 | 77.4 | 72.8 | 6 | ||||||||||||||||
EMEA | 19.7 | 16.2 | 22 | 58.1 | 50.6 | 15 | ||||||||||||||||
Latin America | 23.5 | 20.7 | 14 | 75.0 | 64.4 | 16 | ||||||||||||||||
Total property | 120.8 | 88.3 | 37 | 338.9 | 304.9 | 11 | ||||||||||||||||
Services | 3.4 | 6.3 | (46 | ) | 8.8 | 12.7 | (31 | ) | ||||||||||||||
Other | 63.7 | 83.3 | (24 | ) | 203.1 | 223.1 | (9 | ) | ||||||||||||||
Total selling, general, administrative and development expense | $ | 187.9 | $ | 177.9 | 6 | % | $ | 550.8 | $ | 540.7 | 2 | % | ||||||||||
• | The increases in each of our U.S., EMEA and Latin America property segment SG&A were primarily driven by increased personnel costs to support our business, including our acquisitions of urban telecommunications assets in our Latin America property segment and the Kenya Acquisition. |
• | The increase in our Asia property segment SG&A was primarily driven by an increase in bad debt expense of $16.7 million. |
• | The decrease in our services segment SG&A was primarily driven by a decrease in personnel costs. |
• | The decrease in other SG&A was primarily attributable to the nonrecurrence of $19.1 million of stock-based compensation expense due to the acceleration of expense associated with amendments to existing grants during the three months ended September 30, 2018. |
• | The increases in each of our U.S., EMEA and Latin America property segment SG&A were primarily driven by increased personnel costs to support our business, including our acquisitions of urban telecommunications assets in our Latin America property segment and the Kenya Acquisition. |
• | The increase in our Asia property segment SG&A was primarily driven by an increase in bad debt expense of $2.0 million. |
• | The decrease in our services segment SG&A was primarily driven by a decrease in personnel costs. |
• | The decrease in other SG&A was primarily attributable to the nonrecurrence of $19.1 million of stock-based compensation expense due to the acceleration of expense associated with amendments to existing grants during the nine months ended September 30, 2018. |
Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | |||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||
Property | ||||||||||||||||||||||
U.S. | $ | 843.9 | $ | 726.5 | 16 | % | $ | 2,365.6 | $ | 2,150.6 | 10 | % | ||||||||||
Asia | 101.5 | 114.9 | (12 | ) | 300.9 | 298.5 | 1 | |||||||||||||||
EMEA | 103.2 | 92.9 | 11 | 297.0 | 281.8 | 5 | ||||||||||||||||
Latin America | 204.6 | 187.3 | 9 | 625.1 | 579.8 | 8 | ||||||||||||||||
Total property | 1,253.2 | 1,121.6 | 12 | 3,588.6 | 3,310.7 | 8 | ||||||||||||||||
Services | 16.9 | 14.2 | 19 | % | 55.8 | 45.6 | 22 | % | ||||||||||||||
Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | |||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||
Depreciation, amortization and accretion | $ | 442.8 | $ | 448.9 | (1 | )% | $ | 1,328.6 | $ | 1,344.9 | (1 | )% | ||||||||||
Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | |||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||
Other operating expenses | $ | 34.7 | $ | 34.8 | (0 | )% | $ | 83.5 | $ | 269.6 | (69 | )% | ||||||||||
Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | ||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||
Total other expense | $ | 186.3 | $ | 177.4 | 5 | % | $ | 579.6 | $ | 558.8 | 4 | % | |||||||||
Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | |||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||
Income tax provision (benefit) | $ | 36.7 | $ | 12.5 | 194 | % | $ | 100.3 | $ | (14.7 | ) | (782 | )% | |||||||||
Effective tax rate | 6.8 | % | 3.2 | % | 6.9 | % | (1.5 | )% | ||||||||||||||
Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | |||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||
Net income | $ | 505.3 | $ | 377.3 | 34 | % | $ | 1,347.2 | $ | 972.0 | 39 | % | ||||||||||
Income tax provision (benefit) | 36.7 | 12.5 | 194 | 100.3 | (14.7 | ) | (782 | ) | ||||||||||||||
Other income | (2.8 | ) | (21.1 | ) | (87 | ) | (19.6 | ) | (14.1 | ) | 39 | |||||||||||
Loss on retirement of long-term obligations | — | — | — | 22.2 | — | 100 | ||||||||||||||||
Interest expense | 201.3 | 209.2 | (4 | ) | 613.3 | 616.7 | (1 | ) | ||||||||||||||
Interest income | (12.2 | ) | (10.1 | ) | 21 | (36.3 | ) | (43.9 | ) | (17 | ) | |||||||||||
Other operating expenses | 34.7 | 34.8 | (0 | ) | 83.5 | 269.6 | (69 | ) | ||||||||||||||
Depreciation, amortization and accretion | 442.8 | 448.9 | (1 | ) | 1,328.6 | 1,344.9 | (1 | ) | ||||||||||||||
Stock-based compensation expense | 23.5 | 43.8 | (46 | ) | 87.9 | 111.3 | (21 | ) | ||||||||||||||
Adjusted EBITDA | $ | 1,229.3 | $ | 1,095.3 | 12 | % | $ | 3,527.1 | $ | 3,241.8 | 9 | % | ||||||||||
Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | |||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||
Net income | $ | 505.3 | $ | 377.3 | 34 | % | $ | 1,347.2 | $ | 972.0 | 39 | % | ||||||||||
Real estate related depreciation, amortization and accretion | 394.0 | 399.7 | (1 | ) | 1,183.2 | 1,197.1 | (1 | ) | ||||||||||||||
Losses from sale or disposal of real estate and real estate related impairment charges (1) | 32.2 | 22.5 | 43 | 75.7 | 245.5 | (69 | ) | |||||||||||||||
Dividends on preferred stock | — | — | — | — | (9.4 | ) | (100 | ) | ||||||||||||||
Adjustments for unconsolidated affiliates and noncontrolling interests | (31.5 | ) | (51.1 | ) | (38 | ) | (107.9 | ) | (198.2 | ) | (46 | ) | ||||||||||
Nareit FFO attributable to American Tower Corporation common stockholders | $ | 900.0 | $ | 748.4 | 20 | % | $ | 2,498.2 | $ | 2,207.0 | 13 | % | ||||||||||
Straight-line revenue | (88.6 | ) | (25.4 | ) | 249 | (99.6 | ) | (70.7 | ) | 41 | ||||||||||||
Straight-line expense | 11.7 | 12.1 | (3 | ) | 32.9 | 46.7 | (30 | ) | ||||||||||||||
Stock-based compensation expense | 23.5 | 43.8 | (46 | ) | 87.9 | 111.3 | (21 | ) | ||||||||||||||
Deferred portion of income tax (2) | 3.6 | (18.2 | ) | (120 | ) | (10.7 | ) | (90.0 | ) | (88 | ) | |||||||||||
Non-real estate related depreciation, amortization and accretion | 48.8 | 49.2 | (1 | ) | 145.4 | 147.8 | (2 | ) | ||||||||||||||
Amortization of deferred financing costs, capitalized interest, debt discounts and premiums and long-term deferred interest charges | 7.8 | 3.6 | 117 | 20.6 | 12.6 | 63 | ||||||||||||||||
Payment of shareholder loan interest (3) | — | — | — | (14.2 | ) | — | 100 | |||||||||||||||
Other income (4) | (2.8 | ) | (21.1 | ) | (87 | ) | (19.6 | ) | (14.1 | ) | 39 | |||||||||||
Loss on retirement of long-term obligations | — | — | — | 22.2 | — | 100 | ||||||||||||||||
Other operating expense (5) | 2.5 | 12.3 | (80 | ) | 7.8 | 24.1 | (68 | ) | ||||||||||||||
Capital improvement capital expenditures | (44.6 | ) | (32.0 | ) | 39 | (109.2 | ) | (93.3 | ) | 17 | ||||||||||||
Corporate capital expenditures | (2.1 | ) | (2.4 | ) | (13 | ) | (7.6 | ) | (7.1 | ) | 7 | |||||||||||
Adjustments for unconsolidated affiliates and noncontrolling interests | 31.5 | 51.1 | (38 | ) | 107.9 | 198.2 | (46 | ) | ||||||||||||||
Consolidated AFFO | $ | 891.3 | $ | 821.4 | 9 | % | $ | 2,662.0 | $ | 2,472.5 | 8 | % | ||||||||||
Adjustments for unconsolidated affiliates and noncontrolling interests (6) | (30.3 | ) | (41.8 | ) | (28 | )% | (90.1 | ) | (158.9 | ) | (43 | )% | ||||||||||
AFFO attributable to American Tower Corporation common stockholders | $ | 861.0 | $ | 779.6 | 10 | % | $ | 2,571.9 | $ | 2,313.6 | 11 | % | ||||||||||
(1) | Included in these amounts are impairment charges of $14.0 million, $1.8 million, $45.1 million and $182.4 million, respectively. |
(2) | For the nine months ended September 30, 2018, amount includes a tax benefit primarily attributable to the tax effect of an increase in impairment charges and a one-time benefit for merger-related activity in our Asia property segment. |
(3) | Relates to the payment of capitalized interest associated with the shareholder loan previously owed to our joint venture partner in Ghana (see note 8 to our consolidated and condensed consolidated financial statements included in this Quarterly Report on Form 10-Q). This long-term deferred interest was previously expensed but excluded from Consolidated AFFO. |
(4) | Includes losses (gains) on foreign currency exchange rate fluctuations of $1.1 million, ($2.2) million, ($13.7) million and $14.9 million, respectively. |
(5) | Primarily includes acquisition-related costs and integration costs. |
(6) | Includes adjustments for the impact on both Nareit FFO attributable to American Tower Corporation common stockholders as well as the other line items included in the calculation of Consolidated AFFO. |
As of September 30, 2019 | |||
Available under the 2013 Credit Facility | $ | 1,728.0 | |
Available under the 2014 Credit Facility | 2,100.0 | ||
Letters of credit | (10.0 | ) | |
Total available under credit facilities, net | $ | 3,818.0 | |
Cash and cash equivalents | 1,352.6 | ||
Total liquidity | $ | 5,170.6 | |
Nine Months Ended September 30, | |||||||
2019 | 2018 | ||||||
Net cash provided by (used for): | |||||||
Operating activities | $ | 2,758.9 | $ | 2,485.1 | |||
Investing activities | (1,400.8 | ) | (2,055.1 | ) | |||
Financing activities | (1,174.6 | ) | (34.3 | ) | |||
Net effect of changes in foreign currency exchange rates on cash and cash equivalents | (40.1 | ) | (57.3 | ) | |||
Net increase in cash and cash equivalents | $ | 143.4 | $ | 338.4 | |||
• | We spent $687.6 million for acquisitions. |
• | We spent $754.9 million for capital expenditures, as follows (in millions): |
Discretionary capital projects (1) | $ | 288.3 | |
Ground lease purchases (2) | 111.6 | ||
Capital improvements and corporate expenditures (3) | 116.8 | ||
Redevelopment | 188.2 | ||
Start-up capital projects | 50.0 | ||
Total capital expenditures (4) | $ | 754.9 | |
(1) | Includes the construction of 3,132 communications sites globally. |
(2) | Includes $21.2 million of perpetual land easement payments reported in Deferred financing costs and other financing activities in the cash flows from financing activities in our condensed consolidated statements of cash flows. |
(3) | Includes $16.4 million of finance lease payments reported in Repayments of notes payable, credit facilities, senior notes, secured debt, term loan, finance leases and capital leases in the cash flows from financing activities in our condensed consolidated statements of cash flows. |
(4) | Net of purchase credits of $7.4 million on certain assets, which are recorded in investing activities in our condensed consolidated statements of cash flows. |
Discretionary capital projects (1) | $ | 385 | to | $ | 415 | ||
Ground lease purchases | 165 | to | 175 | ||||
Capital improvements and corporate expenditures | 160 | to | 180 | ||||
Redevelopment | 270 | to | 290 | ||||
Start-up capital projects | 70 | to | 90 | ||||
Total capital expenditures | $ | 1,050 | to | $ | 1,150 | ||
Nine Months Ended September 30, | |||||||
2019 | 2018 | ||||||
Proceeds from issuance of senior notes, net | $ | 3,529.7 | $ | 584.9 | |||
Repayments of credit facilities, net | (753.0 | ) | (715.9 | ) | |||
Proceeds from term loan | 1,300.0 | 1,500.0 | |||||
Repayments of term loan | (1,500.0 | ) | — | ||||
Proceeds from issuance of securities in securitization transaction | — | 500.0 | |||||
Repayments of securitized debt | — | (500.0 | ) | ||||
Repayments of senior notes | (1,700.0 | ) | — | ||||
Distributions to noncontrolling interest holders, net | (11.6 | ) | (14.3 | ) | |||
Purchase of redeemable noncontrolling interest (1) | (425.7 | ) | — | ||||
Distributions paid on common and preferred stock | (1,182.2 | ) | (994.0 | ) | |||
Purchases of common stock | — | (181.2 | ) | ||||
(1) | In the fourth quarter of 2018, two of our minority holders in India delivered notice of exercise of their put options with respect to certain shares in our Indian subsidiary, ATC TIPL (see note 12 to our consolidated and condensed consolidated financial statements included in this Quarterly Report on Form 10-Q). During the nine months ended September 30, 2019, we completed the redemption of the put shares for total consideration of INR 29.4 billion ($425.7 million at the date of redemption). |
Bank Facility (1) | Outstanding Principal Balance ($ in millions) | Maturity Date | LIBOR borrowing interest rate range (2) | Base rate borrowing interest rate range (2) | Current margin over LIBOR and the base rate, respectively | |||
2013 Credit Facility | $ | 1,122.0 | June 28, 2022 | (3) | 0.875% - 1.750% | 0.000% - 0.750% | 1.125% and 0.125% | |
2014 Credit Facility | $ | — | January 31, 2024 | (3) | 0.875% - 1.750% | 0.000% - 0.750% | 1.125% and 0.125% | |
2013 Term Loan | $ | 1,000.0 | January 31, 2024 | 0.875% - 1.750% | 0.000% - 0.750% | 1.125% and 0.125% | ||
2019 Term Loan | $ | 1,300.0 | February 13, 2020 | 0.550% - 1.375% | 0.000% - 0.375% | 0.800% and 0.000% | ||
(2) | Represents interest rate above LIBOR for LIBOR based borrowings and the interest rate above the defined base rate for base rate borrowings, in each case based on our debt ratings. |
(3) | Subject to two optional renewal periods. |
Compliance Tests For The 12 Months Ended September 30, 2019 ($ in billions) | ||||||
Ratio (1) | Additional Debt Capacity Under Covenants (2) | Capacity for Adjusted EBITDA Decrease Under Covenants (3) | ||||
Consolidated Total Leverage Ratio | Total Debt to Adjusted EBITDA ≤ 6.00:1.00 | ~ $8.7 | ~ $1.5 | |||
Consolidated Senior Secured Leverage Ratio | Senior Secured Debt to Adjusted EBITDA ≤ 3.00:1.00 | ~ $12.2 (4) | ~ $4.1 | |||
(1) | Each component of the ratio as defined in the applicable loan agreement. |
(2) | Assumes no change to Adjusted EBITDA. |
(3) | Assumes no change to our debt levels. |
(4) | Effectively, however, additional Senior Secured Debt under this ratio would be limited to the capacity under the Consolidated Total Leverage Ratio. |
Issuer or Borrower | Notes/Securities Issued | Conditions Limiting Distributions of Excess Cash | Excess Cash Distributed During the Nine Months Ended September 30, 2019 | DSCR as of September 30, 2019 | Capacity for Decrease in Net Cash Flow Before Triggering Cash Trap DSCR (1) | Capacity for Decrease in Net Cash Flow Before Triggering Minimum DSCR (1) | ||
Cash Trap DSCR | Amortization Period | |||||||
(in millions) | (in millions) | (in millions) | ||||||
2015 Securitization | GTP Acquisition Partners | American Tower Secured Revenue Notes, Series 2015-1 and Series 2015-2 | 1.30x, Tested Quarterly (2) | (3)(4) | $181.4 | 9.24x | $212.1 | $216.1 |
Trust Securitizations | AMT Asset Subs | Secured Tower Revenue Securities, Series 2013-2A, Secured Tower Revenue Securities, Series 2018-1, Subclass A and Secured Tower Revenue Securities, Series 2018-1, Subclass R | 1.30x, Tested Quarterly (2) | (3)(5) | $373.6 | 10.64x | $558.1 | $567.1 |
(1) | Based on the net cash flow of the applicable issuer or borrower as of September 30, 2019 and the expenses payable over the next 12 months on the 2015 Notes or the Loan, as applicable. |
(2) | Once triggered, a Cash Trap DSCR condition continues to exist until the DSCR exceeds the Cash Trap DSCR for two consecutive calendar quarters. During a Cash Trap DSCR condition, all cash flow in excess of amounts required to make debt service payments, fund required reserves, pay management fees and budgeted operating expenses and make other payments required under the applicable transaction documents, referred to as excess cash flow, will be deposited into a reserve account (the “Cash Trap Reserve Account”) instead of being released to the applicable issuer or borrower. |
(3) | An amortization period commences if the DSCR is equal to or below 1.15x (the “Minimum DSCR”) at the end of any calendar quarter and continues to exist until the DSCR exceeds the Minimum DSCR for two consecutive calendar quarters. |
(4) | No amortization period is triggered if the outstanding principal amount of a series has not been repaid in full on the applicable anticipated repayment date. However, in such event, additional interest will accrue on the unpaid principal balance of the applicable series, and such series will begin to amortize on a monthly basis from excess cash flow. |
(5) | An amortization period exists if the outstanding principal amount has not been paid in full on the applicable anticipated repayment date and continues to exist until such principal has been repaid in full. |
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 4. | CONTROLS AND PROCEDURES |
ITEM 1. | LEGAL PROCEEDINGS |
ITEM 1A. | RISK FACTORS |
ITEM 6. | EXHIBITS |
Exhibit No. | Description of Document | |
3.1 | ||
3.2 | ||
3.3 | ||
4.1 | ||
31.1 | ||
31.2 | ||
32 | ||
101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
101.DEF | Inline XBRL Taxonomy Extension Definition | |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |
AMERICAN TOWER CORPORATION | ||||
Date: October 31, 2019 | By: | /S/ THOMAS A. BARTLETT | ||
Thomas A. Bartlett Executive Vice President and Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer) | ||||
1. | I have reviewed this Quarterly Report on Form 10-Q of American Tower Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: October 31, 2019 | By: | /S/ JAMES D. TAICLET | |||
James D. Taiclet | |||||
Chairman, President and Chief Executive Officer | |||||
1. | I have reviewed this Quarterly Report on Form 10-Q of American Tower Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: October 31, 2019 | By: | /S/ THOMAS A. BARTLETT | |||
Thomas A. Bartlett | |||||
Executive Vice President and Chief Financial Officer | |||||
Date: October 31, 2019 | By: | /S/ JAMES D. TAICLET | ||||
James D. Taiclet | ||||||
Chairman, President and Chief Executive Officer | ||||||
Date: October 31, 2019 | By: | /S/ THOMAS A. BARTLETT | ||||
Thomas A. Bartlett | ||||||
Executive Vice President and Chief Financial Officer | ||||||
LEASES - SCHEDULE OF INFORMATION ABOUT OTHER LEASE RELATED BALANCES (Details) $ in Millions |
Sep. 30, 2019
USD ($)
|
|---|---|
| Operating leases: | |
| Right-of-use asset | $ 7,214.7 |
| Current portion of lease liability | 475.1 |
| Lease liability | 6,448.0 |
| Total operating lease liability | 6,923.1 |
| Finance leases: | |
| Current portion of lease liability | 7.1 |
| Lease liability | 23.1 |
| Total finance lease liability | $ 30.2 |
PROPERTY AND EQUIPMENT - FINANCE LEASES INCLUDED IN PROPERTY PLANT AND EQUIPMENT (Details) $ in Millions |
Sep. 30, 2019
USD ($)
|
|---|---|
| Property, Plant and Equipment [Line Items] | |
| Land easements, not depreciable | $ 1,533.3 |
| Towers | |
| Property, Plant and Equipment [Line Items] | |
| Property and equipment | 2,706.9 |
| Accumulated depreciation | (1,039.8) |
| Property and equipment, net | 1,667.1 |
| Buildings and improvements | |
| Property, Plant and Equipment [Line Items] | |
| Property and equipment | 171.4 |
| Accumulated depreciation | (64.8) |
| Property and equipment, net | 106.6 |
| Land | |
| Property, Plant and Equipment [Line Items] | |
| Property and equipment | 152.1 |
| Equipment | |
| Property, Plant and Equipment [Line Items] | |
| Property and equipment | 45.0 |
| Accumulated depreciation | (11.9) |
| Property and equipment, net | $ 33.1 |
ACQUISITIONS - SCHEDULE OF MERGER AND ACQUISITION RELATED COSTS (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|
| Business Combinations [Abstract] | ||||
| Acquisition and merger related expenses | $ 5.8 | $ 0.9 | $ 11.6 | $ 6.8 |
| Integration costs | $ 1.6 | $ 9.8 | $ 7.8 | $ 15.0 |
STOCK-BASED COMPENSATION - SUMMARY OF STOCK-BASED COMPENSATION EXPENSE (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|
| Stock-based compensation expense | $ 23.5 | $ 43.8 | $ 87.9 | $ 111.3 |
| Stock-based compensation expense capitalized as property and equipment | 0.3 | 0.6 | 1.2 | 1.6 |
| Property | ||||
| Stock-based compensation expense | 0.4 | 0.8 | 1.4 | 2.0 |
| Service | ||||
| Stock-based compensation expense | $ 0.2 | 0.2 | $ 0.7 | 0.7 |
| Selling, General and Administrative | ||||
| Stock-based compensation expense | $ 42.8 | $ 108.6 | ||
EQUITY - DISTRIBUTIONS (Details) - USD ($) $ / shares in Units, $ in Millions |
9 Months Ended | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Oct. 03, 2019 |
Sep. 13, 2019 |
Jul. 12, 2019 |
May 22, 2019 |
Apr. 26, 2019 |
Mar. 07, 2019 |
Jan. 14, 2019 |
Dec. 05, 2018 |
Oct. 17, 2018 |
Sep. 06, 2018 |
Jul. 13, 2018 |
May 24, 2018 |
Apr. 27, 2018 |
Mar. 08, 2018 |
Jan. 22, 2018 |
Jan. 16, 2018 |
Dec. 07, 2017 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|
| Dividends Payable [Line Items] | |||||||||||||||||||
| Aggregate Payment Amount on common stock | $ 1,182.2 | $ 975.1 | |||||||||||||||||
| Aggregate Payment Amount on preferred stock | $ 0.0 | $ 18.9 | |||||||||||||||||
| Common Stock | |||||||||||||||||||
| Dividends Payable [Line Items] | |||||||||||||||||||
| Distribution per share, common stock (in dollars per share) | $ 0.95 | $ 0.92 | $ 0.90 | $ 0.84 | $ 0.79 | $ 0.77 | $ 0.75 | $ 0.70 | |||||||||||
| Aggregate Payment Amount on common stock | $ 407.0 | $ 397.8 | $ 370.5 | $ 348.3 | $ 339.8 | $ 331.2 | $ 300.2 | ||||||||||||
| Common Stock | Subsequent Event | |||||||||||||||||||
| Dividends Payable [Line Items] | |||||||||||||||||||
| Aggregate Payment Amount on common stock | $ 420.7 | ||||||||||||||||||
| Preferred Stock - Series B | |||||||||||||||||||
| Dividends Payable [Line Items] | |||||||||||||||||||
| Distribution per share, preferred stock (in dollars per share) | $ 13.75 | ||||||||||||||||||
| Aggregate Payment Amount on preferred stock | $ 18.9 | ||||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS |
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| Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS The changes in the carrying value of goodwill for each of the Company’s business segments were as follows:
_______________
The Company’s other intangible assets subject to amortization consisted of the following:
_______________
The acquired network location intangibles represent the value to the Company of the incremental revenue growth that could potentially be obtained from leasing the excess capacity on acquired communications sites. The acquired tenant-related intangibles typically represent the value to the Company of tenant contracts and relationships in place at the time of an acquisition or similar transaction, including assumptions regarding estimated renewals. The Company amortizes its acquired network location intangibles and tenant-related intangibles on a straight-line basis over their estimated useful lives. As of September 30, 2019, the remaining weighted average amortization period of the Company’s intangible assets was 14 years. Amortization of intangible assets for the three and nine months ended September 30, 2019 was $197.9 million and $590.2 million, respectively, and amortization of intangible assets for the three and nine months ended September 30, 2018 was $207.4 million and $615.0 million, respectively. Based on current exchange rates, the Company expects to record amortization expense as follows over the remaining current year and the five subsequent years:
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BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES |
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| Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES The accompanying consolidated and condensed consolidated financial statements have been prepared by American Tower Corporation (together with its subsidiaries, “ATC” or the “Company”) pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The financial information included herein is unaudited. However, the Company believes that all adjustments, which are of a normal and recurring nature, considered necessary for a fair presentation of its financial position and results of operations for such periods have been included herein. The consolidated and condensed consolidated financial statements and related notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (the “2018 Form 10-K”). The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the entire year. Principles of Consolidation and Basis of Presentation—The accompanying consolidated and condensed consolidated financial statements include the accounts of the Company and those entities in which it has a controlling interest. Investments in entities that the Company does not control are accounted for using the equity method or as investments in equity securities, depending upon the Company’s ability to exercise significant influence over operating and financial policies. All intercompany accounts and transactions have been eliminated. As of September 30, 2019, the Company holds (i) a 51% controlling interest in each of two joint ventures, one in Ghana and one in Uganda (MTN Group Limited (“MTN”) holds a 49% noncontrolling interest), (ii) a 51% controlling interest in a joint venture that primarily consists of the Company’s operations in Germany and France (PGGM holds a 49% noncontrolling interest), (iii) an approximate 81% controlling interest in a subsidiary of the Company in South Africa (South African investors hold an approximate 19% noncontrolling interest) and (iv) a 79% controlling interest in ATC Telecom Infrastructure Private Limited (“ATC TIPL”), formerly Viom Networks Limited (“Viom”), in India. Significant Accounting Policies—The Company’s significant accounting policies are described in note 1 to the Company’s consolidated financial statements included in the 2018 Form 10-K. There have been no material changes to the Company’s significant accounting policies during the nine months ended September 30, 2019, except the adoption of new lease accounting guidance, as discussed below. Cash and Cash Equivalents and Restricted Cash—The reconciliation of cash and cash equivalents and restricted cash reported within the applicable balance sheet that sum to the total of the same such amounts shown in the statement of cash flows is as follows:
Lease—The new lease standard requires leases to be accounted for using a right-of-use model, which recognizes that, at the date of commencement, a lessee has a financial obligation to make lease payments to the lessor for the right to use the underlying asset during the lease term. The lessee recognizes a corresponding right-of-use asset related to this right. On January 1, 2019, the Company elected to adopt the new lease standard using the modified retrospective method applied to lease arrangements that were in place on the transition date. Results for reporting periods beginning January 1, 2019 are presented under the new standard, while prior-period amounts are not adjusted and continue to be reported in accordance with accounting under the previously applicable guidance. The Company elected certain available practical expedients which permit the adopter to not reassess certain items upon adoption, including: (i) whether any existing contracts are or contain leases, (ii) the classification of existing leases and (iii) initial direct costs for existing leases. The Company also elected the practical expedient related to easements, which permits carryforward accounting treatment for land easements on existing agreements. The Company recorded a net increase to opening Distributions in excess of earnings in its consolidated balance sheet of $24.7 million as of January 1, 2019 due to the cumulative impact of adopting the new lease standard. This adjustment related to right-of-use asset impairments. The Company also recorded a lease liability of $6.9 billion and a corresponding right-of-use asset of $7.1 billion upon adoption of the new lease standard. Those rights and obligations are primarily related to operating leases for ground space underneath the Company’s communications sites. The right-of-use assets recorded include, among other items, amounts previously classified as prepaid rent, deferred lease acquisition costs, fair value adjustments on acquired leases and long-term deferred rent obligations. Finance leases, which primarily relate to towers, equipment and vehicles, were largely unchanged. There was no significant change to the Company’s consolidated statements of operations resulting from the adoption of this standard. The Company did not elect the practical expedient for short-term leases, which permits an adopter to not apply the lease standard to leases with a remaining maturity of one year or less, and applied the new lease accounting standard to all leases, including short-term leases. In conjunction with the adoption of the new lease accounting guidance, the Company applied the lessor and lessee practical expedient and no longer separates lease and non-lease components within a lease agreement when the timing and pattern of revenue recognition for the components are the same and the combined single lease component is classified as an operating lease. Certain amounts, such as power and fuel and common area maintenance, which were previously reported as non-lease revenue, are now accounted for as lease revenue. Accordingly, the Company has reclassified certain prior-period amounts within its disclosures. Revenue—Most of the Company’s revenue is derived from leasing arrangements and is accounted for as lease revenue unless the timing and pattern of revenue recognition differs from the lease components. Revenue related to distributed antenna system (“DAS”) networks and fiber results from agreements with tenants that are not leases. Non-lease revenue—Non-lease revenue consists primarily of revenue generated from DAS networks, fiber and other property related revenue. DAS networks and fiber arrangements require that the Company provide the tenant the right to use the applicable communications infrastructure. Performance obligations are satisfied over time for the duration of the arrangements. Other property related revenue streams, which include site inspections, are not material on either an individual or consolidated basis. Services revenue—The Company offers tower-related services in the United States. These services include site acquisition, zoning and permitting (“AZP”) and structural analysis. There is a single performance obligation related to AZP and revenue is recognized over time based on milestones achieved, which are determined based on costs expected to be incurred. Structural analysis services may have more than one performance obligation, contingent upon the number of contracted services. Revenue is recognized at the point in time the services are completed. A summary of revenue disaggregated by source and geography is as follows:
_______________
_______________
Information about receivables, contract assets and contract liabilities from non-lease contracts with tenants is as follows:
_______________
The Company records unearned revenue when payments are received from tenants in advance of the completion of the Company’s performance obligations. Long-term unearned revenue is included in Other non-current liabilities. During the three and nine months ended September 30, 2019, the Company recognized $15.7 million and $45.8 million, respectively, of revenue that was included in the Unearned revenue balance as of December 31, 2018. During the three and nine months ended September 30, 2018, the Company recognized $10.8 million and $33.3 million, respectively, of revenue from the Unearned revenue balance as of January 1, 2018. The Company also recognized revenues of $14.8 million and $44.2 million during the three and nine months ended September 30, 2019, respectively, and $13.8 million and $41.2 million during the three and nine months ended September 30, 2018, respectively, for capital contributions related to DAS networks. There was $0.1 million and $0.3 million during the three and nine months ended September 30, 2019, respectively, and $0.2 million and $0.4 million during the three and nine months ended September 30, 2018, respectively, of revenue recognized from Other non-current liabilities. The Company records unbilled receivables, which are included in Prepaids and other current assets, when it has completed a performance obligation prior to its ability to bill under the customer arrangement. Other contract assets are included in Notes receivable and other non-current assets. The Company did not record any change in unbilled receivables attributable to revenue recognized during each of the three and nine months ended September 30, 2019 and 2018. The change in contract assets attributable to revenue recognized was $5.2 million and $3.8 million during the three and nine months ended September 30, 2019, respectively, and less than $0.1 million for each of the three and nine months ended September 30, 2018. Accounting Standards Updates In June 2016, the Financial Accounting Standards Board (the “FASB”) issued guidance that modifies how entities measure credit losses on most financial instruments. The new guidance replaces the current "incurred loss" model with an "expected credit loss" model that requires consideration of a broader range of information to estimate expected credit losses over the lifetime of the asset. The new guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, and will be applied using a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the effective date. Operating lease receivables are not within the scope of this guidance. The Company is finalizing its analysis of the impact of this guidance on its financial statements and does not expect the adoption of this guidance to have a material impact on the Company’s financial statements. In January 2017, the FASB issued guidance on accounting for goodwill impairments. The guidance eliminates Step 2 from the goodwill impairment test and requires, among other things, recognition of an impairment loss when the carrying value of a reporting unit exceeds its fair value. The loss recognized is limited to the total amount of goodwill allocated to that reporting unit. The guidance is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company does not expect the adoption of this guidance to have a material impact on the Company’s financial statements. In August 2018, the FASB issued guidance on the accounting for implementation costs incurred in a cloud computing arrangement that is a service contract. This guidance aligns the accounting for costs incurred to implement a cloud computing arrangement that is a service arrangement with the guidance on capitalizing costs associated with developing or obtaining internal-use software. The Company adopted this guidance prospectively on July 1, 2019. The adoption of this guidance did not have a material impact on the Company’s financial statements.
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FAIR VALUE MEASUREMENTS |
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| Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The Company determines the fair value of its financial instruments based on the fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Below are the three levels of inputs that may be used to measure fair value:
Items Measured at Fair Value on a Recurring Basis—The fair values of the Company’s financial assets and liabilities that are required to be measured on a recurring basis at fair value were as follows:
_______________
During the nine months ended September 30, 2019, the Company made no changes to the methods described in note 11 to its consolidated financial statements included in the 2018 Form 10-K that it used to measure the fair value of its interest rate swap agreements, the embedded derivative in one of its lease agreements, acquisition-related contingent consideration and redeemable noncontrolling interests. The changes in fair value for the embedded derivative in one of its lease agreements and acquisition-related contingent consideration during the nine months ended September 30, 2019 and 2018 were not material to the consolidated financial statements. The changes in the carrying amount of the redeemable noncontrolling interests are described in note 12. As of September 30, 2019, the Company estimated the value of all potential acquisition-related contingent consideration payments to be between zero and $0.8 million. Items Measured at Fair Value on a Nonrecurring Basis Assets Held and Used—The Company’s long-lived assets are recorded at amortized cost and, if impaired, are adjusted to fair value using Level 3 inputs. The Company recorded $14.0 million and $45.1 million of impairments during the three and nine months ended September 30, 2019, respectively, and $1.8 million and $182.4 million of impairments during the three and nine months ended September 30, 2018, respectively. There were no other items measured at fair value on a nonrecurring basis during the nine months ended September 30, 2019 or 2018. Fair Value of Financial Instruments—The Company’s financial instruments for which the carrying value reasonably approximates fair value at September 30, 2019 and December 31, 2018 include cash and cash equivalents, restricted cash, accounts receivable and accounts payable. The Company’s estimates of fair value of its long-term obligations, including the current portion, are based primarily upon reported market values. For long-term debt not actively traded, fair value is estimated using either indicative price quotes or a discounted cash flow analysis using rates for debt with similar terms and maturities. As of September 30, 2019 and December 31, 2018, the carrying value of long-term obligations, including the current portion, was $21.5 billion and $21.2 billion, respectively. As of September 30, 2019, the fair value of long-term obligations, including the current portion, was $22.4 billion, of which $16.1 billion was measured using Level 1 inputs and $6.3 billion was measured using Level 2 inputs. As of December 31, 2018, the fair value of long-term obligations, including the current portion, was $21.1 billion, of which $13.4 billion was measured using Level 1 inputs and $7.7 billion was measured using Level 2 inputs.
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PROPERTY AND EQUIPMENT (Tables) |
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| Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Property and Equipment | Property and equipment (including assets held under financing leases) consisted of the following:
_______________
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| Schedule of Finance Lease Assets Included In Property Plant And Equipment | As of December 31, 2018, property and equipment included $4,369.5 million of capital lease assets with related equipment and improvements and $1,016.2 million of accumulated depreciation. Information about finance lease-related balances is as follows:
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ACCRUED EXPENSES (Tables) |
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| Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of accrued expenses | Accrued expenses consisted of the following:
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
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Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
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| Statement of Comprehensive Income [Abstract] | ||||
| Changes in fair value of cash flow hedges, tax | $ 0.0 | $ 0.0 | $ 0.0 | $ 0.0 |
| Reclassification of unrealized gains on cash flow hedges to net income, tax | 0.0 | 0.0 | 0.0 | 0.0 |
| Foreign currency translation adjustments, tax expense (benefit) | $ 0.0 | $ 1.0 | $ 0.4 | $ (2.8) |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Statement of Financial Position [Abstract] | ||
| Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
| Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
| Common stock, shares issued (in shares) | 453,392,000 | 451,617,000 |
| Common stock, shares outstanding (in shares) | 442,386,000 | 441,060,000 |
| Treasury stock, shares (in shares) | 10,557,000 | 10,557,000 |
BUSINESS SEGMENTS |
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| Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BUSINESS SEGMENTS | BUSINESS SEGMENTS The Company’s primary business is leasing space on multitenant communications sites to wireless service providers, radio and television broadcast companies, wireless data providers, government agencies and municipalities and tenants in a number of other industries. This business is referred to as the Company’s property operations, which as of September 30, 2019, consisted of the following:
The Company’s services segment offers tower-related services in the United States, including AZP and structural analysis, which primarily support its site leasing business, including the addition of new tenants and equipment on its sites. The services segment is a strategic business unit that offers different services from, and requires different resources, skill sets and marketing strategies than, the property operating segments. The accounting policies applied in compiling segment information below are similar to those described in note 1 to the Company’s consolidated financial statements included in the 2018 Form 10-K and as updated in note 1 above. Among other factors, in evaluating financial performance in each business segment, management uses segment gross margin and segment operating profit. The Company defines segment gross margin as 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. The Company defines segment operating profit as segment gross margin less Selling, general, administrative and development expense attributable to the segment, excluding stock-based compensation expense and corporate expenses. For reporting purposes, for periods through September 30, 2018, the Latin America property segment gross margin and segment operating profit also include Interest income (expense), TV Azteca, net. These measures of segment gross margin and segment operating profit are also before Interest income, Interest expense, Gain (loss) on retirement of long-term obligations, Other income (expense), Net income (loss) attributable to noncontrolling interests and Income tax benefit (provision). The categories of expenses indicated above, such as depreciation, have been excluded from segment operating performance as they are not considered in the review of information or the evaluation of results by management. There are no significant revenues resulting from transactions between the Company’s operating segments. All intercompany transactions are eliminated to reconcile segment results and assets to the consolidated statements of operations and consolidated balance sheets. Summarized financial information concerning the Company’s reportable segments for the three and nine months ended September 30, 2019 and 2018 is shown in the following tables. The “Other” column (i) represents amounts excluded from specific segments, such as business development operations, stock-based compensation expense and corporate expenses included in Selling, general, administrative and development expense; Other operating expenses; Interest income; Interest expense; Gain (loss) on retirement of long-term obligations; and Other income (expense), and (ii) reconciles segment operating profit to Income from continuing operations before income taxes.
(2) Primarily includes interest expense and $182.4 million in impairment charges.
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EQUITY |
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| Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| EQUITY | EQUITY Sales of Equity Securities—The Company receives proceeds from the sale of its equity securities pursuant to the ESPP and upon exercise of stock options granted under the 2007 Plan. During the nine months ended September 30, 2019, the Company received an aggregate of $92.7 million in proceeds upon exercises of stock options and sales pursuant to the ESPP. Stock Repurchase Programs—In March 2011, the Board of Directors approved a stock repurchase program, pursuant to which the Company is authorized to repurchase up to $1.5 billion of its common stock (the “2011 Buyback”). In December 2017, the Board of Directors approved an additional stock repurchase program, pursuant to which the Company is authorized to repurchase up to $2.0 billion of its common stock (the “2017 Buyback” and, together with the 2011 Buyback, the “Buyback Programs”). During the nine months ended September 30, 2019, there were no repurchases under either of the Buyback Programs. As of September 30, 2019, the Company has repurchased a total of 14,003,543 shares of its common stock under the 2011 Buyback for an aggregate of $1.4 billion, including commissions and fees. The Company has not made any repurchases under the 2017 Buyback. Under the Buyback Programs, the Company is authorized to purchase shares from time to time through open market purchases, in privately negotiated transactions not to exceed market prices, and (with respect to such open market purchases) pursuant to plans adopted in accordance with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, in accordance with securities laws and other legal requirements and subject to market conditions and other factors. The Company expects to fund any further purchases of its common stock through a combination of cash on hand, cash generated by operations and borrowings under its credit facilities. Purchases under the Buyback Programs are subject to, among other things, the Company having available cash to fund the purchases. Distributions—During the nine months ended September 30, 2019, the Company declared or paid the following cash distributions (per share data reflects actual amounts):
During the nine months ended September 30, 2018, the Company declared or paid the following cash distributions (per share data reflects actual amounts):
The Company accrues distributions on unvested restricted stock units, which are payable upon vesting. As of September 30, 2019, the amount accrued for distributions payable related to unvested restricted stock units was $12.3 million. During the nine months ended September 30, 2019 and 2018, the Company paid $6.9 million and $4.2 million of distributions upon the vesting of restricted stock units, respectively. To maintain its qualification for taxation as a REIT, the Company expects to continue paying distributions, the amount, timing and frequency of which will be determined, and subject to adjustment, by the Company’s Board of Directors.
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EQUITY (Tables) |
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| Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of declared or paid cash distributions | During the nine months ended September 30, 2019, the Company declared or paid the following cash distributions (per share data reflects actual amounts):
During the nine months ended September 30, 2018, the Company declared or paid the following cash distributions (per share data reflects actual amounts):
(1) Does not include amounts accrued for distributions payable related to unvested restricted stock units.
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LEASES - MATURITIES OF OPERATING AND FINANCE LEASE LIABILITIES (Details) $ in Millions |
Sep. 30, 2019
USD ($)
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|---|---|
| Operating Lease | |
| Remainder of 2019 | $ 217.4 |
| 2020 | 876.0 |
| 2021 | 860.4 |
| 2022 | 822.4 |
| 2023 | 785.4 |
| Thereafter | 6,735.8 |
| Total lease payments | 10,297.4 |
| Less amounts representing interest | (3,374.3) |
| Total operating lease liability | 6,923.1 |
| Less current portion of lease liability | (475.1) |
| Non-current lease liability | 6,448.0 |
| Finance Lease | |
| Remainder of 2019 | 2.8 |
| 2020 | 7.6 |
| 2021 | 4.9 |
| 2022 | 4.0 |
| 2023 | 2.6 |
| Thereafter | 45.5 |
| Total lease payments | 67.4 |
| Less amounts representing interest | (37.2) |
| Total finance lease liability | 30.2 |
| Less current portion of lease liability | (7.1) |
| Non-current lease liability | $ 23.1 |
ACQUISITIONS - PRO FORMA INFORMATION (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | 9 Months Ended | ||
|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
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| Business Combinations [Abstract] | ||||
| Pro forma revenues | $ 1,957.7 | $ 1,813.4 | $ 5,676.0 | $ 5,499.9 |
| Pro forma net income attributable to American Tower Corporation common stockholders | $ 497.7 | $ 363.3 | $ 1,321.9 | $ 937.8 |
| Pro forma net income per common share amounts: | ||||
| Basic net income attributable to American Tower Corporation common stockholders (in dollars per share) | $ 1.12 | $ 0.82 | $ 2.99 | $ 2.14 |
| Diluted net income attributable to American Tower Corporation common stockholders (in dollars per share) | $ 1.12 | $ 0.82 | $ 2.97 | $ 2.12 |
ACCRUED EXPENSES (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Payables and Accruals [Abstract] | ||
| Accrued property and real estate taxes | $ 195.1 | $ 169.7 |
| Accrued pass-through costs | 74.4 | 71.2 |
| Amounts payable to tenants | 65.8 | 93.5 |
| Accrued rent | 75.3 | 61.4 |
| Payroll and related withholdings | 81.4 | 90.4 |
| Accrued construction costs | 30.0 | 41.5 |
| Accrued income tax payable | 34.1 | 57.9 |
| Accrued pass-through taxes | 5.2 | 2.2 |
| Other accrued expenses | 295.4 | 360.5 |
| Total accrued expenses | $ 856.7 | $ 948.3 |
ACQUISITIONS |
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| Business Combinations [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ACQUISITIONS | ACQUISITIONS Impact of current year acquisitions—The Company typically acquires communications sites from wireless carriers or other tower operators and subsequently integrates those sites into its existing portfolio of communications sites. The financial results of the Company’s acquisitions have been included in the Company’s consolidated statements of operations for the three and nine months ended September 30, 2019 from the date of the respective acquisition. The date of acquisition, and by extension the point at which the Company begins to recognize the results of an acquisition, may depend on, among other things, the receipt of contractual consents, the commencement and extent of leasing arrangements and the timing of the transfer of title or rights to the assets, which may be accomplished in phases. Sites acquired from communications service providers may never have been operated as a business and may instead have been utilized solely by the seller as a component of its network infrastructure. An acquisition may or may not involve the transfer of business operations or employees. The Company evaluates each of its acquisitions under the accounting guidance framework to determine whether to treat an acquisition as an asset acquisition or a business combination. For those transactions treated as asset acquisitions, the purchase price is allocated to the assets acquired, with no recognition of goodwill. For those acquisitions accounted for as business combinations, the Company recognizes acquisition and merger related expenses in the period in which they are incurred and services are received; for transactions accounted for as asset acquisitions, these costs are capitalized as part of the purchase price. Acquisition and merger related costs may include finder’s fees, advisory, legal, accounting, valuation and other professional or consulting fees and general administrative costs directly related to completing the transaction. Integration costs include incremental and non-recurring costs necessary to convert data, retain employees and otherwise enable the Company to operate acquired businesses or assets efficiently. The Company records acquisition and merger related expenses for business combinations, as well as integration costs for all acquisitions, in Other operating expenses in the consolidated statements of operations. During the three and nine months ended September 30, 2019 and 2018, the Company recorded acquisition and merger related expenses for business combinations and non-capitalized asset acquisition costs and integration costs as follows:
The Company also received $13.1 million related to pre-acquisition contingencies and settlements during the nine months ended September 30, 2019. 2019 Transactions The estimated aggregate impact of the acquisitions completed in 2019 on the Company’s revenues and gross margin for the three months ended September 30, 2019 was approximately $5.3 million and $3.9 million, respectively, and for the nine months ended September 30, 2019 was approximately $7.9 million and $5.7 million, respectively. The revenues and gross margin amounts also reflect incremental revenues from the addition of new tenants to such sites subsequent to the transaction date. U.S. Acquisition—On August 30, 2019, the Company acquired approximately 400 towers and other related property interests in the United States for an aggregate total purchase price of $483.9 million. This acquisition was accounted for as an asset acquisition. Other Acquisitions—During the nine months ended September 30, 2019, the Company acquired a total of 582 communications sites in the United States, Colombia, Mexico, Paraguay and Peru, as well as other communications infrastructure assets, for an aggregate purchase price of $183.8 million. The majority of these acquisitions were accounted for as asset acquisitions. The following table summarizes the allocations of the purchase prices for the fiscal year 2019 acquisitions based upon their estimated fair value at the date of acquisition:
In addition to the acquisitions discussed above, on August 30, 2019, the Company purchased 243 towers related to the ALLTEL transaction described in note 15 for an aggregate purchase price of $43.0 million. Other Signed Acquisitions Eaton Towers—On May 30, 2019, the Company entered into a definitive agreement to acquire 100% of the outstanding shares of Eaton Towers Holding Limited (“Eaton Towers”), which owns and operates approximately 5,500 communications sites across five African markets. The total consideration for the transaction, including the Company’s assumption of existing Eaton Towers debt, is approximately $1.85 billion, subject to customary closing adjustments. The transaction is expected to close by the end of 2019, subject to customary closing conditions, including the satisfaction of regulatory approvals. Subject to the closing of the Eaton Towers transaction, the Company anticipates acquiring the interests of MTN in each of the Company’s joint ventures in Ghana and Uganda. 2018 Transactions During the nine months ended September 30, 2019, the allocation of the purchase price for the acquisition of Idea Cellular Infrastructure Services Limited was finalized with no material post-closing adjustments. During the nine months ended September 30, 2019, there were no material post-closing adjustments that impacted other 2018 acquisitions. Pro Forma Consolidated Results (Unaudited) The following table presents the unaudited pro forma financial results as if the 2019 acquisitions had occurred on January 1, 2018 and the 2018 acquisitions had occurred on January 1, 2017. The pro forma results do not include any anticipated cost synergies, costs or other integration impacts. Accordingly, such pro forma amounts are not necessarily indicative of the results that actually would have occurred had the transactions been completed on the date indicated, nor are they indicative of the future operating results of the Company.
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REDEEMABLE NONCONTROLLING INTERESTS |
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| Noncontrolling Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| REDEEMABLE NONCONTROLLING INTERESTS | REDEEMABLE NONCONTROLLING INTERESTS Redeemable Noncontrolling Interests—On April 21, 2016, the Company, through its wholly owned subsidiary, ATC Asia Pacific Pte. Ltd., acquired a 51% controlling ownership interest in ATC TIPL (formerly Viom), a telecommunications infrastructure company that owns and operates wireless communications towers and indoor DAS networks in India (the “Viom Acquisition”), which was subsequently merged with the Company’s existing India property operations. In connection with the Viom Acquisition, the Company, through one of its subsidiaries, entered into a shareholders agreement (the “Shareholders Agreement”) with Viom and the following remaining Viom shareholders: Tata Sons Limited (“Tata Sons”), Tata Teleservices Limited (“Tata Teleservices”), IDFC Private Equity Fund III (“IDFC”), Macquarie SBI Infrastructure Investments Pte Limited and SBI Macquarie Infrastructure Trust (collectively, the “Remaining Shareholders”). The Shareholders Agreement also provides the Remaining Shareholders with put options, which allow them to sell outstanding shares of ATC TIPL to the Company, and the Company with call options, which allow it to buy the noncontrolling shares of ATC TIPL. The put options, which are not under the Company’s control, cannot be separated from the noncontrolling interests. As a result, the combination of the noncontrolling interests and the redemption feature requires classification as redeemable noncontrolling interests in the consolidated balance sheet, separate from equity. The noncontrolling interests become redeemable after the passage of time, and therefore, the Company records the carrying amount of the noncontrolling interests outside of permanent equity at the greater of (i) the initial carrying amount, increased or decreased for the noncontrolling interests’ share of net income or loss and foreign currency translation adjustments, or (ii) the estimated redemption value. If required, the Company will adjust the redeemable noncontrolling interests to the estimated redemption value on each balance sheet date with changes in the estimated redemption value recognized as an adjustment to Net income attributable to noncontrolling interests. The Company adjusts the estimated redemption value of the noncontrolling interests based on the operating results of ATC TIPL and previously recorded adjustments to the estimated redemption value. During the nine months ended September 30, 2019, the Company reduced the estimated redemption value of the noncontrolling interests by $2.2 million. During the nine months ended September 30, 2018, the Company increased the estimated redemption value of the noncontrolling interests by $28.6 million. The adjustment for the nine months ended September 30, 2018 was primarily due to the impact of impairment charges on net income and, as a result, on the carrying value of the noncontrolling interests. The put options may be exercised, requiring the Company to purchase the Remaining Shareholders’ equity interests, on specified dates through March 31, 2021. The price of the put options will be based on the fair market value of the exercising Remaining Shareholders’ interest in the Company’s India operations at the time the option is exercised. Put options held by certain of the Remaining Shareholders are subject to a floor price of INR 216 per share. During the nine months ended September 30, 2019, the Company redeemed 50% of Tata Teleservices and Tata Sons’ combined holdings of ATC TIPL and 100% of IDFC’s holdings of ATC TIPL, for total consideration of INR 29.4 billion ($425.7 million at the date of redemption). As a result of the redemption, the Company’s controlling interest in ATC TIPL increased from 63% to 79% and the noncontrolling interest decreased from 37% to 21%. The changes in Redeemable noncontrolling interests for the nine months ended September 30, 2019 and 2018 were as follows:
In April 2019, Tata Teleservices and Tata Sons delivered notice of exercise of their put options with respect to 100% of their remaining holdings in ATC TIPL. The Company expects to complete the redemption of the put shares, subject to regulatory approval, for total consideration of INR 24.8 billion (approximately $350.1 million at the September 30, 2019 exchange rate) in the fourth quarter of 2019. After the completion of the redemption, the Company will hold an approximately 92% ownership interest in ATC TIPL.
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EARNINGS PER COMMON SHARE (Tables) |
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| Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of earnings per basic and diluted by common class | The following table sets forth basic and diluted net income per common share computational data (shares in thousands, except per share data):
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| Schedule of antidilutive securities excluded from computation of earnings per share | The following shares were not included in the computation of diluted earnings per share because the effect would be anti-dilutive (in thousands, on a weighted average basis):
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BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Dec. 31, 2017 |
|---|---|---|---|---|
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
| Cash and cash equivalents | $ 1,352.6 | $ 1,208.7 | $ 1,026.5 | |
| Restricted cash | 95.7 | 96.2 | 266.8 | |
| Total cash and cash equivalents and restricted cash | $ 1,448.3 | $ 1,304.9 | $ 1,293.3 | $ 954.9 |
NOTES RECEIVABLE AND OTHER NON-CURRENT ASSETS (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Receivables [Abstract] | ||
| Long-term prepaid ground rent | $ 0.0 | $ 607.5 |
| Notes receivable | 1.0 | 1.0 |
| Other miscellaneous assets | 247.9 | 354.1 |
| Notes receivable and other non-current assets | $ 248.9 | $ 962.6 |
LEASES - SUPPLEMENTAL CASH FLOW INFOMATION (Details) $ in Millions |
9 Months Ended |
|---|---|
|
Sep. 30, 2019
USD ($)
| |
| Cash paid for amounts included in the measurement of lease liabilities: | |
| Operating cash flows from operating leases | $ (701.9) |
| Operating cash flows from finance leases | (1.1) |
| Financing cash flows from finance leases | (16.4) |
| Non-cash items: | |
| New operating leases | 224.8 |
| Operating lease modifications and reassessments | $ 338.9 |
LEASES - SCHEDULE OF FUTURE MINIMUM RENTAL RECEIPTS EXPECTED BEFORE TOPIC 842 (Details) $ in Millions |
Dec. 31, 2018
USD ($)
|
|---|---|
| Lessor, Operating Lease, Payments, Fiscal Year Maturity [Abstract] | |
| 2019 | $ 5,251.2 |
| 2020 | 5,062.2 |
| 2021 | 4,676.1 |
| 2022 | 3,754.6 |
| 2023 | 3,457.3 |
| Thereafter | 12,641.1 |
| Total | $ 34,842.5 |
INCOME TAXES - NARRATIVE (Details) - USD ($) |
3 Months Ended | 9 Months Ended | |
|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2019 |
Dec. 31, 2018 |
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| Income Tax Contingency [Line Items] | |||
| Unrecognized tax benefits that would impact the ETR | $ 93,300,000 | $ 93,300,000 | $ 93,700,000 |
| Unrecognized tax benefits, increase resulting from current period tax positions | 1,400,000 | 4,400,000 | |
| Unrecognized tax benefits, from foreign currency fluctuations | (3,700,000) | (2,700,000) | |
| Unrecognized tax benefits, income tax penalties and interest accrued | 22,700,000 | 22,700,000 | $ 19,100,000 |
| Minimum | |||
| Income Tax Contingency [Line Items] | |||
| Decrease in unrecognized tax benefits is reasonably possible | 0 | 0 | |
| Maximum | |||
| Income Tax Contingency [Line Items] | |||
| Decrease in unrecognized tax benefits is reasonably possible | $ 27,500,000 | $ 27,500,000 |
STOCK-BASED COMPENSATION - SUMMARY OF THE COMPANY'S OPTION ACTIVITY (Details) - Employee Stock Option |
9 Months Ended |
|---|---|
|
Sep. 30, 2019
shares
| |
| Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
| Outstanding as of January 1, 2019 (in shares) | 4,257,470 |
| Granted (in shares) | 0 |
| Exercised (in shares) | (1,080,169) |
| Forfeited (in shares) | (7,211) |
| Expired (in shares) | 0 |
| Outstanding as of June 30, 2019 (in shares) | 3,170,090 |
LONG-TERM OBLIGATIONS |
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| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| LONG-TERM OBLIGATIONS | LONG-TERM OBLIGATIONS Outstanding amounts under the Company’s long-term obligations, reflecting discounts, premiums, debt issuance costs and fair value adjustments due to interest rate swaps consisted of the following:
_______________
Current portion of long-term obligations—The Company’s current portion of long-term obligations primarily includes (i) $1.3 billion under its unsecured term loan entered into on February 14, 2019 (the “2019 Term Loan”), (ii) $750.0 million aggregate principal amount of 2.800% senior unsecured notes due 2020 and (iii) $350.0 million aggregate principal amount of the American Tower Secured Revenue Notes, Series 2015-1, Class A, issued by GTP Acquisition Partners I, LLC in a private securitization transaction in May 2015, with anticipated repayment date in 2020. Securitized Debt—Cash flows generated by the sites that secure the securitized debt of the Company are only available for payment of such debt and are not available to pay the Company’s other obligations or the claims of its creditors. However, subject to certain restrictions, the Company holds the right to receive the excess cash flows not needed to pay the securitized debt and other obligations arising out of the securitizations. The securitized debt is the obligation of the issuers thereof or borrowers thereunder, as applicable, and their subsidiaries, and not of the Company or its other subsidiaries. Repayments of Senior Notes Repayment of 3.40% Senior Notes—On the February 15, 2019 maturity date, the Company repaid $1.0 billion aggregate principal amount of 3.40% senior unsecured notes due 2019 (the “3.40% Notes”). The 3.40% Notes were repaid with borrowings from the Company’s multicurrency senior unsecured revolving credit facility entered into in June 2013, as amended (the “2013 Credit Facility”) and the Company’s senior unsecured revolving credit facility entered into in January 2012 and amended and restated in September 2014, as further amended (the “2014 Credit Facility”). Upon completion of the repayment, none of the 3.40% Notes remained outstanding. Repayment of 5.050% Senior Notes—On April 22, 2019, the Company redeemed all of the $700.0 million aggregate principal amount of 5.050% senior unsecured notes due 2020 (the “5.050% Notes”) at a price equal to 103.0050% of the principal amount, plus accrued and unpaid interest up to, but excluding April 22, 2019, for an aggregate redemption price of $726.0 million, including $5.0 million in accrued and unpaid interest. The Company recorded a loss on retirement of long-term obligations of $22.1 million, which includes prepayment consideration of $21.0 million and the associated unamortized discount and deferred financing costs. The redemption was funded with borrowings from the 2014 Credit Facility and cash on hand. Upon completion of the repayment, none of the 5.050% Notes remained outstanding. Offerings of Senior Notes 3.375% Senior Notes and 3.950% Senior Notes Offering—On March 15, 2019, the Company completed a registered public offering of $650.0 million aggregate principal amount of 3.375% senior unsecured notes due 2024 (the “3.375% Notes”) and $600.0 million aggregate principal amount of 3.950% senior unsecured notes due 2029 (the “3.950% Notes”). The net proceeds from this offering were approximately $1,231.0 million, after deducting commissions and estimated expenses. The Company used the net proceeds to repay existing indebtedness under the 2013 Credit Facility and the 2014 Credit Facility. The 3.375% Notes will mature on May 15, 2024 and bear interest at a rate of 3.375% per annum. The 3.950% Notes will mature on March 15, 2029 and bear interest at a rate of 3.950% per annum. Accrued and unpaid interest on the 3.375% Notes will be payable in U.S. Dollars semi-annually in arrears on May 15 and November 15 of each year, beginning on November 15, 2019. Accrued and unpaid interest on the 3.950% Notes will be payable in U.S. Dollars semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2019. Interest on the 3.375% Notes and the 3.950% Notes will accrue from March 15, 2019 and will be computed on the basis of a 360-day year comprised of twelve 30-day months. 2.950% Senior Notes and 3.800% Senior Notes Offering—On June 13, 2019, the Company completed a registered public offering of $650.0 million aggregate principal amount of 2.950% senior unsecured notes due 2025 (the “2.950% Notes”) and $1.65 billion aggregate principal amount of 3.800% senior unsecured notes due 2029 (the “3.800% Notes” and, collectively with the 3.375% Notes, the 3.950% Notes and the 2.950% Notes, the “Notes”). The net proceeds from this offering were approximately $2,269.0 million, after deducting commissions and estimated expenses. The Company used the net proceeds to repay existing indebtedness under the 2013 Credit Facility and the 2014 Credit Facility. The 2.950% Notes will mature on January 15, 2025 and bear interest at a rate of 2.950% per annum. The 3.800% Notes will mature on August 15, 2029 and bear interest at a rate of 3.800% per annum. Accrued and unpaid interest on the 2.950% Notes will be payable in U.S. Dollars semi-annually in arrears on January 15 and July 15 of each year, beginning on January 15, 2020. Accrued and unpaid interest on the 3.800% Notes will be payable in U.S. Dollars semi-annually in arrears on February 15 and August 15 of each year, beginning on February 15, 2020. Interest on the 2.950% Notes and the 3.800% Notes will accrue from June 13, 2019 and will be computed on the basis of a 360-day year comprised of twelve 30-day months. The Company may redeem the Notes at any time, in whole or in part, at a redemption price equal to 100% of the principal amount of the Notes plus a make-whole premium, together with accrued interest to the redemption date. If the Company redeems the 3.375% Notes on or after April 15, 2024, the 2.950% Notes on or after December 15, 2024, the 3.950% Notes on or after December 15, 2028 or the 3.800% Notes on or after May 15, 2029, it will not be required to pay a make-whole premium. In addition, if the Company undergoes a change of control and corresponding ratings decline, each as defined in the applicable supplemental indenture, it may be required to repurchase all of the Notes at a purchase price equal to 101% of the principal amount of such Notes, plus accrued and unpaid interest (including additional interest, if any), up to but not including the repurchase date. The Notes rank equally with all of the Company’s other senior unsecured debt and are structurally subordinated to all existing and future indebtedness and other obligations of its subsidiaries. The supplemental indentures contain certain covenants that restrict the Company’s ability to merge, consolidate or sell assets and its (together with its subsidiaries’) ability to incur liens. These covenants are subject to a number of exceptions, including that the Company and its subsidiaries may incur certain liens on assets, mortgages or other liens securing indebtedness if the aggregate amount of indebtedness secured by such liens does not exceed 3.5x Adjusted EBITDA, as defined in the applicable supplemental indenture. Bank Facilities 2013 Credit Facility—During the nine months ended September 30, 2019, the Company borrowed an aggregate of $1.7 billion and repaid an aggregate of $2.5 billion of revolving indebtedness under the 2013 Credit Facility. The Company used the borrowings to fund acquisitions, to purchase redeemable noncontrolling interests, to repay existing indebtedness and for general corporate purposes. 2014 Credit Facility—During the nine months ended September 30, 2019, the Company borrowed an aggregate of $1.6 billion and repaid an aggregate of $1.6 billion of revolving indebtedness under the 2014 Credit Facility. The Company used the borrowings to repay existing indebtedness and for general corporate purposes. 2019 Term Loan—During the nine months ended September 30, 2019, the Company entered into the 2019 Term Loan, the net proceeds of which were used, together with cash on hand, to repay all outstanding indebtedness under its $1.5 billion unsecured term loan entered into on March 29, 2018. The 2019 Term Loan matures on February 13, 2020. Any outstanding principal and accrued but unpaid interest will be due and payable in full at maturity. The 2019 Term Loan may be paid prior to maturity in whole or in part at the Company’s option without penalty or premium. The 2019 Term Loan agreement contains certain reporting, information, financial and operating covenants and other restrictions (including limitations on additional debt, guaranties, sales of assets and liens) with which the Company must comply. Failure to comply with the financial and operating covenants of the loan agreement may constitute a default, which could result in, among other things, the amounts outstanding, including all accrued interest and unpaid fees, becoming immediately due and payable. As of September 30, 2019, the key terms under the 2013 Credit Facility, the 2014 Credit Facility, the Company’s unsecured term loan entered into in October 2013, as amended (the “2013 Term Loan”), and the 2019 Term Loan were as follows:
_______________ (1) LIBOR means the London Interbank Offered Rate. (2) Fee on undrawn portion of each credit facility. (3) Subject to two optional renewal periods.
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LEASES |
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| Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| LEASES | LEASES The Company determines if an arrangement is a lease at the inception of the agreement. The Company considers an arrangement to be a lease if it conveys the right to control the use of the communications site or ground space underneath a communications site for a period of time in exchange for consideration. The Company is both a lessor and a lessee. Lessor—The Company is a lessor in most of its revenue arrangements, as property revenue is derived from tenant leases of specifically-identified, physically distinct space on the Company’s communications real estate assets. The Company’s lease arrangements with its tenants vary depending upon the region and the industry of the tenant and generally have initial non-cancellable terms of five to ten years with multiple renewal terms. The leases also contain provisions that periodically increase the rent due, typically annually, based on a fixed escalation percentage or an inflationary index, or a combination of both. The Company structures its leases to include financial penalties if a tenant terminates the lease, which serve to disincentivize tenants from terminating the lease prior to the expiration of the lease term. The Company’s leasing arrangements outside of the U.S. may require that the Company provide power to the communications site through an electrical grid connection, diesel fuel generators or other sources and permit the Company to pass through the costs of, or otherwise charge for, these services. Many arrangements require that the communications site has power for a specified percentage of time. In most cases, if delivery of power falls below the specified service level, a corresponding reduction in revenue is recorded. The Company has determined that this performance obligation is satisfied over time for the duration of the lease. The Company typically has more than one tenant on a site and, by performing ordinary course repair and maintenance work, can often lease a site, either through renewing existing agreements or leasing to new tenants, for periods beyond the existing tenant lease term. Accordingly, the Company has minimal risk with respect to the residual value of its leased assets. Communications sites are depreciated over their estimated useful lives, which generally do not exceed twenty years. As of September 30, 2019, the Company does not have any material related party leases as a lessor. The Company generally does not enter into sales-type leases or direct financing leases. The Company’s leases generally do not include any incentives for the lessee and do not include any lessee purchase options. Historically, the Company has been able to successfully renew its ground leases as needed to ensure continuation of its tower revenue. Accordingly, the Company assumes that it will have access to the land underneath its tower sites when calculating future minimum rental receipts. Future minimum rental receipts expected under non-cancellable operating lease agreements as of September 30, 2019 were as follows:
_______________
On August 30, 2019, the Company entered into a new master lease agreement with one of its tenants in the U.S., AT&T Inc. (“AT&T”), which resulted in an additional $13.7 billion in future minimum rental receipts expected under non-cancellable operating lease agreements. Future minimum rental receipts expected under non-cancellable operating lease agreements in effect at December 31, 2018 were as follows:
_______________
Lessee—The Company enters into arrangements as a lessee primarily for ground space underneath its communications sites. These arrangements are typically long-term lease agreements with initial non-cancellable terms of approximately five to ten years with one or more automatic or exercisable renewal periods and specified increases in lease payments upon exercise of the renewal options. The Company typically exercises its ground lease renewal options in order to provide ongoing tenant space on its communications sites through the end of the tenant lease term. Escalation clauses present in operating leases, excluding those tied to a consumer price index (“CPI”) or other inflation-based indices, are recognized on a straight-line basis over the estimated lease term of the applicable lease. Additionally, the escalations tied to CPI or another inflation-based index are considered variable lease payments. In certain circumstances, the Company enters into revenue sharing arrangements with the ground space owner, which results in variability in lease payments. In most markets outside of the U.S., in the event there are no tenants on the communications site, the Company generally has unilateral termination rights and in certain situations, the lease is structured to allow for termination by the Company with minimal or no penalties. Ground lease arrangements usually include annual escalations and do not contain any residual value guarantees or restrictions on dividends, other financial obligations or other similar terms. The Company has entered into certain transactions whereby at the end of a lease, sublease or similar arrangement, the Company has the option to purchase the corresponding communications sites. These transactions are further described in note 15. The Company’s lease liability is the present value of the remaining minimum rental payments to be made over the remaining lease term, including renewal options reasonably certain to be exercised. The Company also considers termination options and factors those into the determination of lease payments when appropriate. To determine the lease term, the Company considers all renewal periods that are reasonably certain to be exercised, taking into consideration all economic factors, including the communications site’s estimated economic life (generally 20 years) and the respective lease terms of the Company’s tenants under the existing lease arrangements on such site. As of the adoption date and new lease inception, the Company’s right-of-use asset is equal to its lease liability, plus payments made prior to the commencement date and initial direct costs, net of any impairment losses, lease incentives, fair value adjustments on acquired leases and deferred rent amount recorded under the prior lease accounting guidance. The Company assesses its right-of-use asset and other lease-related assets for impairment, as described in note 1 to the Company’s consolidated financial statements included in the 2018 Form 10-K. There were no material impairments recorded related to these assets during the three and nine months ended September 30, 2019. As of September 30, 2019, the Company does not have any material related party leases as a lessee. The Company does not have any sale-leaseback arrangements as lessee and typically does not enter into leveraged leases. The Company leases certain land and office space under operating leases and land and improvements, towers and vehicles under finance leases. As of September 30, 2019, operating lease assets were included in Right-of-use asset and finance lease assets were included in Property and equipment, net in the consolidated balance sheet. Information about other lease-related balances as of September 30, 2019 is as follows:
As most of the Company’s leases do not specifically state an implicit rate, the Company uses a market-specific incremental borrowing rate consistent with the lease term as of the lease commencement date when calculating the present value of remaining lease payments. The incremental borrowing rate reflects the cost to borrow on a securitized basis in each market. The remaining lease term does not reflect all renewal options available to the Company, only those renewal options that the Company has assessed as reasonably certain of being exercised taking into consideration the economic factors noted above. The weighted-average remaining lease terms and incremental borrowing rates as of September 30, 2019 are as follows:
The following table sets forth the components of lease cost for the three and nine months ended September 30, 2019:
_______________
The interest expense on finance lease liabilities was $0.4 million and $1.1 million for the three and nine months ended September 30, 2019, respectively. Assets held under finance leases are recorded in property and equipment and are depreciated over the lesser of the remaining lease term or the remaining useful life. Supplemental cash flow information for the nine months ended September 30, 2019 is as follows:
As of September 30, 2019, the Company does not have material operating or financing leases that have not yet commenced. Maturities of operating and finance lease liabilities as of September 30, 2019 were as follows:
_______________
Future minimum rental payments under non-cancellable operating leases as of December 31, 2018 is as follows:
_______________
Future minimum rental payments under capital leases in effect as of December 31, 2018 were as follows:
_______________
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| LEASES | LEASES The Company determines if an arrangement is a lease at the inception of the agreement. The Company considers an arrangement to be a lease if it conveys the right to control the use of the communications site or ground space underneath a communications site for a period of time in exchange for consideration. The Company is both a lessor and a lessee. Lessor—The Company is a lessor in most of its revenue arrangements, as property revenue is derived from tenant leases of specifically-identified, physically distinct space on the Company’s communications real estate assets. The Company’s lease arrangements with its tenants vary depending upon the region and the industry of the tenant and generally have initial non-cancellable terms of five to ten years with multiple renewal terms. The leases also contain provisions that periodically increase the rent due, typically annually, based on a fixed escalation percentage or an inflationary index, or a combination of both. The Company structures its leases to include financial penalties if a tenant terminates the lease, which serve to disincentivize tenants from terminating the lease prior to the expiration of the lease term. The Company’s leasing arrangements outside of the U.S. may require that the Company provide power to the communications site through an electrical grid connection, diesel fuel generators or other sources and permit the Company to pass through the costs of, or otherwise charge for, these services. Many arrangements require that the communications site has power for a specified percentage of time. In most cases, if delivery of power falls below the specified service level, a corresponding reduction in revenue is recorded. The Company has determined that this performance obligation is satisfied over time for the duration of the lease. The Company typically has more than one tenant on a site and, by performing ordinary course repair and maintenance work, can often lease a site, either through renewing existing agreements or leasing to new tenants, for periods beyond the existing tenant lease term. Accordingly, the Company has minimal risk with respect to the residual value of its leased assets. Communications sites are depreciated over their estimated useful lives, which generally do not exceed twenty years. As of September 30, 2019, the Company does not have any material related party leases as a lessor. The Company generally does not enter into sales-type leases or direct financing leases. The Company’s leases generally do not include any incentives for the lessee and do not include any lessee purchase options. Historically, the Company has been able to successfully renew its ground leases as needed to ensure continuation of its tower revenue. Accordingly, the Company assumes that it will have access to the land underneath its tower sites when calculating future minimum rental receipts. Future minimum rental receipts expected under non-cancellable operating lease agreements as of September 30, 2019 were as follows:
_______________
On August 30, 2019, the Company entered into a new master lease agreement with one of its tenants in the U.S., AT&T Inc. (“AT&T”), which resulted in an additional $13.7 billion in future minimum rental receipts expected under non-cancellable operating lease agreements. Future minimum rental receipts expected under non-cancellable operating lease agreements in effect at December 31, 2018 were as follows:
_______________
Lessee—The Company enters into arrangements as a lessee primarily for ground space underneath its communications sites. These arrangements are typically long-term lease agreements with initial non-cancellable terms of approximately five to ten years with one or more automatic or exercisable renewal periods and specified increases in lease payments upon exercise of the renewal options. The Company typically exercises its ground lease renewal options in order to provide ongoing tenant space on its communications sites through the end of the tenant lease term. Escalation clauses present in operating leases, excluding those tied to a consumer price index (“CPI”) or other inflation-based indices, are recognized on a straight-line basis over the estimated lease term of the applicable lease. Additionally, the escalations tied to CPI or another inflation-based index are considered variable lease payments. In certain circumstances, the Company enters into revenue sharing arrangements with the ground space owner, which results in variability in lease payments. In most markets outside of the U.S., in the event there are no tenants on the communications site, the Company generally has unilateral termination rights and in certain situations, the lease is structured to allow for termination by the Company with minimal or no penalties. Ground lease arrangements usually include annual escalations and do not contain any residual value guarantees or restrictions on dividends, other financial obligations or other similar terms. The Company has entered into certain transactions whereby at the end of a lease, sublease or similar arrangement, the Company has the option to purchase the corresponding communications sites. These transactions are further described in note 15. The Company’s lease liability is the present value of the remaining minimum rental payments to be made over the remaining lease term, including renewal options reasonably certain to be exercised. The Company also considers termination options and factors those into the determination of lease payments when appropriate. To determine the lease term, the Company considers all renewal periods that are reasonably certain to be exercised, taking into consideration all economic factors, including the communications site’s estimated economic life (generally 20 years) and the respective lease terms of the Company’s tenants under the existing lease arrangements on such site. As of the adoption date and new lease inception, the Company’s right-of-use asset is equal to its lease liability, plus payments made prior to the commencement date and initial direct costs, net of any impairment losses, lease incentives, fair value adjustments on acquired leases and deferred rent amount recorded under the prior lease accounting guidance. The Company assesses its right-of-use asset and other lease-related assets for impairment, as described in note 1 to the Company’s consolidated financial statements included in the 2018 Form 10-K. There were no material impairments recorded related to these assets during the three and nine months ended September 30, 2019. As of September 30, 2019, the Company does not have any material related party leases as a lessee. The Company does not have any sale-leaseback arrangements as lessee and typically does not enter into leveraged leases. The Company leases certain land and office space under operating leases and land and improvements, towers and vehicles under finance leases. As of September 30, 2019, operating lease assets were included in Right-of-use asset and finance lease assets were included in Property and equipment, net in the consolidated balance sheet. Information about other lease-related balances as of September 30, 2019 is as follows:
As most of the Company’s leases do not specifically state an implicit rate, the Company uses a market-specific incremental borrowing rate consistent with the lease term as of the lease commencement date when calculating the present value of remaining lease payments. The incremental borrowing rate reflects the cost to borrow on a securitized basis in each market. The remaining lease term does not reflect all renewal options available to the Company, only those renewal options that the Company has assessed as reasonably certain of being exercised taking into consideration the economic factors noted above. The weighted-average remaining lease terms and incremental borrowing rates as of September 30, 2019 are as follows:
The following table sets forth the components of lease cost for the three and nine months ended September 30, 2019:
_______________
The interest expense on finance lease liabilities was $0.4 million and $1.1 million for the three and nine months ended September 30, 2019, respectively. Assets held under finance leases are recorded in property and equipment and are depreciated over the lesser of the remaining lease term or the remaining useful life. Supplemental cash flow information for the nine months ended September 30, 2019 is as follows:
As of September 30, 2019, the Company does not have material operating or financing leases that have not yet commenced. Maturities of operating and finance lease liabilities as of September 30, 2019 were as follows:
_______________
Future minimum rental payments under non-cancellable operating leases as of December 31, 2018 is as follows:
_______________
Future minimum rental payments under capital leases in effect as of December 31, 2018 were as follows:
_______________
|
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| LEASES | LEASES The Company determines if an arrangement is a lease at the inception of the agreement. The Company considers an arrangement to be a lease if it conveys the right to control the use of the communications site or ground space underneath a communications site for a period of time in exchange for consideration. The Company is both a lessor and a lessee. Lessor—The Company is a lessor in most of its revenue arrangements, as property revenue is derived from tenant leases of specifically-identified, physically distinct space on the Company’s communications real estate assets. The Company’s lease arrangements with its tenants vary depending upon the region and the industry of the tenant and generally have initial non-cancellable terms of five to ten years with multiple renewal terms. The leases also contain provisions that periodically increase the rent due, typically annually, based on a fixed escalation percentage or an inflationary index, or a combination of both. The Company structures its leases to include financial penalties if a tenant terminates the lease, which serve to disincentivize tenants from terminating the lease prior to the expiration of the lease term. The Company’s leasing arrangements outside of the U.S. may require that the Company provide power to the communications site through an electrical grid connection, diesel fuel generators or other sources and permit the Company to pass through the costs of, or otherwise charge for, these services. Many arrangements require that the communications site has power for a specified percentage of time. In most cases, if delivery of power falls below the specified service level, a corresponding reduction in revenue is recorded. The Company has determined that this performance obligation is satisfied over time for the duration of the lease. The Company typically has more than one tenant on a site and, by performing ordinary course repair and maintenance work, can often lease a site, either through renewing existing agreements or leasing to new tenants, for periods beyond the existing tenant lease term. Accordingly, the Company has minimal risk with respect to the residual value of its leased assets. Communications sites are depreciated over their estimated useful lives, which generally do not exceed twenty years. As of September 30, 2019, the Company does not have any material related party leases as a lessor. The Company generally does not enter into sales-type leases or direct financing leases. The Company’s leases generally do not include any incentives for the lessee and do not include any lessee purchase options. Historically, the Company has been able to successfully renew its ground leases as needed to ensure continuation of its tower revenue. Accordingly, the Company assumes that it will have access to the land underneath its tower sites when calculating future minimum rental receipts. Future minimum rental receipts expected under non-cancellable operating lease agreements as of September 30, 2019 were as follows:
_______________
On August 30, 2019, the Company entered into a new master lease agreement with one of its tenants in the U.S., AT&T Inc. (“AT&T”), which resulted in an additional $13.7 billion in future minimum rental receipts expected under non-cancellable operating lease agreements. Future minimum rental receipts expected under non-cancellable operating lease agreements in effect at December 31, 2018 were as follows:
_______________
Lessee—The Company enters into arrangements as a lessee primarily for ground space underneath its communications sites. These arrangements are typically long-term lease agreements with initial non-cancellable terms of approximately five to ten years with one or more automatic or exercisable renewal periods and specified increases in lease payments upon exercise of the renewal options. The Company typically exercises its ground lease renewal options in order to provide ongoing tenant space on its communications sites through the end of the tenant lease term. Escalation clauses present in operating leases, excluding those tied to a consumer price index (“CPI”) or other inflation-based indices, are recognized on a straight-line basis over the estimated lease term of the applicable lease. Additionally, the escalations tied to CPI or another inflation-based index are considered variable lease payments. In certain circumstances, the Company enters into revenue sharing arrangements with the ground space owner, which results in variability in lease payments. In most markets outside of the U.S., in the event there are no tenants on the communications site, the Company generally has unilateral termination rights and in certain situations, the lease is structured to allow for termination by the Company with minimal or no penalties. Ground lease arrangements usually include annual escalations and do not contain any residual value guarantees or restrictions on dividends, other financial obligations or other similar terms. The Company has entered into certain transactions whereby at the end of a lease, sublease or similar arrangement, the Company has the option to purchase the corresponding communications sites. These transactions are further described in note 15. The Company’s lease liability is the present value of the remaining minimum rental payments to be made over the remaining lease term, including renewal options reasonably certain to be exercised. The Company also considers termination options and factors those into the determination of lease payments when appropriate. To determine the lease term, the Company considers all renewal periods that are reasonably certain to be exercised, taking into consideration all economic factors, including the communications site’s estimated economic life (generally 20 years) and the respective lease terms of the Company’s tenants under the existing lease arrangements on such site. As of the adoption date and new lease inception, the Company’s right-of-use asset is equal to its lease liability, plus payments made prior to the commencement date and initial direct costs, net of any impairment losses, lease incentives, fair value adjustments on acquired leases and deferred rent amount recorded under the prior lease accounting guidance. The Company assesses its right-of-use asset and other lease-related assets for impairment, as described in note 1 to the Company’s consolidated financial statements included in the 2018 Form 10-K. There were no material impairments recorded related to these assets during the three and nine months ended September 30, 2019. As of September 30, 2019, the Company does not have any material related party leases as a lessee. The Company does not have any sale-leaseback arrangements as lessee and typically does not enter into leveraged leases. The Company leases certain land and office space under operating leases and land and improvements, towers and vehicles under finance leases. As of September 30, 2019, operating lease assets were included in Right-of-use asset and finance lease assets were included in Property and equipment, net in the consolidated balance sheet. Information about other lease-related balances as of September 30, 2019 is as follows:
As most of the Company’s leases do not specifically state an implicit rate, the Company uses a market-specific incremental borrowing rate consistent with the lease term as of the lease commencement date when calculating the present value of remaining lease payments. The incremental borrowing rate reflects the cost to borrow on a securitized basis in each market. The remaining lease term does not reflect all renewal options available to the Company, only those renewal options that the Company has assessed as reasonably certain of being exercised taking into consideration the economic factors noted above. The weighted-average remaining lease terms and incremental borrowing rates as of September 30, 2019 are as follows:
The following table sets forth the components of lease cost for the three and nine months ended September 30, 2019:
_______________
The interest expense on finance lease liabilities was $0.4 million and $1.1 million for the three and nine months ended September 30, 2019, respectively. Assets held under finance leases are recorded in property and equipment and are depreciated over the lesser of the remaining lease term or the remaining useful life. Supplemental cash flow information for the nine months ended September 30, 2019 is as follows:
As of September 30, 2019, the Company does not have material operating or financing leases that have not yet commenced. Maturities of operating and finance lease liabilities as of September 30, 2019 were as follows:
_______________
Future minimum rental payments under non-cancellable operating leases as of December 31, 2018 is as follows:
_______________
Future minimum rental payments under capital leases in effect as of December 31, 2018 were as follows:
_______________
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LEASES (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Lessor, Maturities of Minimum Rental Receipts Expected Under Non-cancellable Operating Leases Lease, Payments to be Received, Maturity | Future minimum rental receipts expected under non-cancellable operating lease agreements as of September 30, 2019 were as follows:
_______________
On August 30, 2019, the Company entered into a new master lease agreement with one of its tenants in the U.S., AT&T Inc. (“AT&T”), which resulted in an additional $13.7 billion in future minimum rental receipts expected under non-cancellable operating lease agreements. Future minimum rental receipts expected under non-cancellable operating lease agreements in effect at December 31, 2018 were as follows:
_______________
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| Schedule of Information About Other Lease-related Balances | Information about other lease-related balances as of September 30, 2019 is as follows:
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| Components of Operating Lease Cost | The weighted-average remaining lease terms and incremental borrowing rates as of September 30, 2019 are as follows:
The following table sets forth the components of lease cost for the three and nine months ended September 30, 2019:
_______________
The interest expense on finance lease liabilities was $0.4 million and $1.1 million for the three and nine months ended September 30, 2019, respectively. Assets held under finance leases are recorded in property and equipment and are depreciated over the lesser of the remaining lease term or the remaining useful life. Supplemental cash flow information for the nine months ended September 30, 2019 is as follows:
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| Maturity of Operating Lease Liabilities | Maturities of operating and finance lease liabilities as of September 30, 2019 were as follows:
_______________ (1) Balances are translated at the applicable period-end exchange rate, which may impact comparability between periods.
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| Maturity of Finance Lease Liabilities | Maturities of operating and finance lease liabilities as of September 30, 2019 were as follows:
_______________ (1) Balances are translated at the applicable period-end exchange rate, which may impact comparability between periods.
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| Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum rental payments under non-cancellable operating leases as of December 31, 2018 is as follows:
_______________ (1) Balances are translated at the applicable period-end exchange rate, which may impact comparability between periods.
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| Schedule of Future Minimum Lease Payments for Capital Leases | Future minimum rental payments under capital leases in effect as of December 31, 2018 were as follows:
_______________ (1) Balances are translated at the applicable period-end exchange rate, which may impact comparability between periods.
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LONG-TERM OBLIGATIONS (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of long-term obligations | Outstanding amounts under the Company’s long-term obligations, reflecting discounts, premiums, debt issuance costs and fair value adjustments due to interest rate swaps consisted of the following:
_______________
(11) Includes the South African credit facility, which is denominated in South African Rand and amortizes through December 17, 2020, the Colombian credit facility, which is denominated in Colombian Pesos and amortizes through April 24, 2021, the Brazil credit facility, which is denominated in Brazilian Reais and amortizes through January 15, 2022, the Kenya debt, which is denominated in U.S. Dollars (“USD”) and is payable either (i) in future installments subject to the satisfaction of specified conditions or (ii) three years from the note origination date, and U.S. subsidiary debt related to a seller-financed acquisition.
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| Schedule of line of credit facilities | As of September 30, 2019, the key terms under the 2013 Credit Facility, the 2014 Credit Facility, the Company’s unsecured term loan entered into in October 2013, as amended (the “2013 Term Loan”), and the 2019 Term Loan were as follows:
_______________ (1) LIBOR means the London Interbank Offered Rate. (2) Fee on undrawn portion of each credit facility. (3) Subject to two optional renewal periods.
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EARNINGS PER COMMON SHARE |
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| Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| EARNINGS PER COMMON SHARE | EARNINGS PER COMMON SHARE The following table sets forth basic and diluted net income per common share computational data (shares in thousands, except per share data):
Shares Excluded From Dilutive Effect—The following shares were not included in the computation of diluted earnings per share because the effect would be anti-dilutive (in thousands, on a weighted average basis):
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INCOME TAXES |
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| Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INCOME TAXES | INCOME TAXES The Company provides for income taxes at the end of each interim period based on the estimated effective tax rate (“ETR”) for the full fiscal year. Cumulative adjustments to the Company’s estimate are recorded in the interim period in which a change in the estimated annual ETR is determined. Under the provisions of the Internal Revenue Code of 1986, as amended, the Company may deduct amounts distributed to stockholders against the income generated by its real estate investment trust (“REIT”) operations. The Company continues to be subject to income taxes on the income of its domestic taxable REIT subsidiaries and income taxes in foreign jurisdictions where it conducts operations. In addition, the Company is able to offset certain income by utilizing its net operating losses, subject to specified limitations. The Company provides valuation allowances if, based on the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. Management assesses the available evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. The increase in the income tax provision during the three months ended September 30, 2019 was primarily attributable to an increase in foreign earnings subject to taxation in the current period. The change in the income tax provision (benefit) for the nine months ended September 30, 2019 was primarily attributable to an increase in foreign earnings subject to taxation in the current period, as well as the nonrecurrence of certain events during the nine months ended September 30, 2018, including a one-time benefit for merger-related activity in the Company’s Asia property segment and the tax effect of certain impairment charges. As of September 30, 2019 and December 31, 2018, the total unrecognized tax benefits that would impact the ETR, if recognized, were approximately $93.3 million and $93.7 million, respectively. The amount of unrecognized tax benefits during the three and nine months ended September 30, 2019 includes additions to the Company’s existing tax positions of $1.4 million and $4.4 million, respectively, which were reduced by foreign currency exchange rate fluctuations of $3.7 million and $2.7 million, respectively. Unrecognized tax benefits are expected to change over the next 12 months if certain tax matters ultimately settle with the applicable taxing jurisdiction during this time frame, as described in note 12 to the Company’s consolidated financial statements included in the 2018 Form 10-K. The impact of the amount of these changes to previously recorded uncertain tax positions could range from zero to $27.5 million. The Company recorded the following penalties and income tax-related interest expense during the three and nine months ended September 30, 2019 and 2018:
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SUBSEQUENT EVENTS |
9 Months Ended |
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Sep. 30, 2019 | |
| Subsequent Events [Abstract] | |
| SUBSEQUENT EVENTS | SUBSEQUENT EVENTS 2.750% Senior Notes and 3.700% Senior Notes Offering—On October 3, 2019, the Company completed a registered public offering of $750.0 million aggregate principal amount of 2.750% senior unsecured notes due 2027 (the “2.750% Notes”) and $600.0 million aggregate principal amount of 3.700% senior unsecured notes due 2049 (the “3.700% Notes”). The net proceeds from this offering were approximately $1,334.2 million, after deducting commissions and estimated expenses. The Company used the net proceeds to repay existing indebtedness under the 2013 Credit Facility and the 2019 Term Loan. The 2.750% Notes will mature on January 15, 2027 and bear interest at a rate of 2.750% per annum. The 3.700% Notes will mature on October 15, 2049 and bear interest at a rate of 3.700% per annum. Accrued and unpaid interest on the 2.750% Notes will be payable in U.S. Dollars semi-annually in arrears on January 15 and July 15 of each year, beginning on January 15, 2020. Accrued and unpaid interest on the 3.700% Notes will be payable in U.S. Dollars semi-annually in arrears on April 15 and October 15 of each year, beginning on April 15, 2020. Interest on the 2.750% Notes and the 3.700% Notes will accrue from October 3, 2019 and will be computed on the basis of a 360-day year comprised of twelve 30-day months. The Company may redeem the 2.750% Notes and the 3.700% Notes at any time, in whole or in part, at a redemption price equal to 100% of the principal amount of the 2.750% Notes and the 3.700% Notes plus a make-whole premium, together with accrued interest to the redemption date. If the Company redeems the 2.750% Notes on or after November 15, 2026 or the 3.700% Notes on or after April 15, 2049, the Company will not be required to pay a make-whole premium. In addition, if the Company undergoes a change of control and corresponding ratings decline, each as defined in the supplemental indenture, it may be required to repurchase all of the 2.750% Notes and the 3.700% Notes at a purchase price equal to 101% of the principal amount of such notes, plus accrued and unpaid interest (including additional interest, if any), up to but not including the repurchase date. The 2.750% Notes and the 3.700% Notes rank equally with all of the Company’s other senior unsecured debt and are structurally subordinated to all existing and future indebtedness and other obligations of its subsidiaries. |