American Tower 3Q profit up, buying cell towers
American Tower Corp. reported a 39 percent profit increase today on increased revenue from wireless communication tower rental and management and a growing presence in India.
The company also announced it has agreed to pay up to $430 million for more than 3,000 cell towers in South Africa, a new market for the Boston-based company.
It agreed to buy up to 1,400 existing cell towers and 1,800 towers to be built from South African cellular telephone operator Cell C Ltd, which will be the anchor tenant on the towers. Cell C has about 7 million cellular subscribers. American Tower said the deal is expected to be completed early next year.
Its shares fell 66 cents, or 1.3 percent, to $51.75 in late morning trading.
American Tower reported net income of $93.4 million, or 23 cents per share, for the three months ended Sept. 30, up from $67.4 million, or 17 cents per share, a year ago. Revenue rose 15.6 percent to $513.3 million from $444.1 million.
Analysts polled by Thomson Reuters expected earnings of 20 cents per share on revenue of $488 million.
American Tower said revenue from its tower rental and management segment rose 16.1 percent to $499.8 million.
Chief executive Jim Taiclet said in a statement that during the quarter, the company extended its presence into high-growth international markets, including the near-tripling of its portfolio in India to 7,600 towers. The company also set up operations in Peru and Colombia.
"We believe that our commitment to maximizing the operating leverage of our current business, while growing our asset base and international presence, positions us well for solid growth in the remainder of 2010 and beyond," Taiclet said.
American Tower also increased the midpoint of its full-year guidance for rental and management segment revenue by $60 million and adjusted earnings before interest, taxes and depreciation by $48 million. It now says rental and management revenue for the full year will be between $1.92 billion and $1.93 billion, with EBIDTA from $1.338 billion to $1.348 billion.