American Tower Corporation Reports First Quarter 2013 Financial Results FIRST QUARTER 2013 HIGHLIGHTS Consolidated Results *Total revenue increased 15.2% to $802.7 million *Operating income increased 9.2% to $299.7 million *Cash provided by operating activities decreased 2.0% to $394.0 million Segment Highlights *Domestic rental and management segment revenue increased 5.9% to $515.7 million *International rental and management segment revenue increased 32.9% to $261.8 million *Network development services segment revenue was $25.3 million Business Wire BOSTON -- May 01, 2013 American Tower Corporation (NYSE: AMT) today reported financial results for the quarter ended March 31, 2013. Jim Taiclet, American Tower’s Chief Executive Officer stated, “Our strong first quarter results, enhanced network investment programs announced by wireless carriers in the U.S. and around the world, and my recent interactions with our field teams on the ground all confirm continuing robust demand for tower space. Leading the charge toward pervasive 4G services are our four major U.S. tenants, who we believe will need to substantially upgrade their existing networks to meet the capacity and elevated signal quality required to deliver services such as LTE video and voice over IP.” FIRST QUARTER 2013 OPERATING RESULTS OVERVIEW American Tower generated the following operating results for the quarter ended March 31, 2013 (unless otherwise indicated, all comparative information is presented against the quarter ended March 31, 2012). Total revenue increased 15.2% to $802.7 million and total rental and management revenue increased 13.7% to $777.4 million. Total rental and management revenue Core Growth was approximately 20.3%. Please refer to the selected statement of operations detail on page 13, which highlights the items affecting all Core Growth percentages for the quarter ended March 31, 2013. Total rental and management Gross Margin increased 12.6% to $589.9 million. Total selling, general, administrative and development expense was $101.2 million, including $20.6 million of stock-based compensation expense. Adjusted EBITDA increased 13.4% to $524.4 million, Core Growth in Adjusted EBITDA was 19.6%, and the Adjusted EBITDA Margin was 65%. Adjusted Funds From Operations (AFFO) increased 9.9% to $357.8 million, Core Growth in AFFO was approximately 20.9%, and AFFO per Share increased 9.8% to $0.90. AFFO reflects the impact of the introduction of a new category of capital expenditures, “Start-Up Capital Projects,” as further described below. Operating income increased 9.2% to $299.7 million, while net income attributable to American Tower Corporation decreased 22.5% to $171.4 million. The decrease was primarily attributable to the $35.3 million loss on retirement of long-term obligations related to the refinancing of the Company’s $1.75 billion securitization and a year over year decline in unrealized foreign currency gains of $33.7 million. Net income attributable to American Tower Corporation per both basic and diluted common share decreased 23.2% to $0.43. Cash provided by operating activities decreased 2.0% to $394.0 million, which was primarily attributable to non-recurring tax refunds received in the first quarter of 2012. Segment Results Domestic Rental and Management Segment – Domestic rental and management segment revenue increased 5.9% to $515.7 million, which represented 64% of total revenues and reflects the positive impact of two non-recurring items during the first quarter of 2012. These items include a tenant billing settlement of $6.0 million and a lease termination settlement of $9.6 million. In addition, domestic rental and management segment Gross Margin increased 7.6% to $423.8 million, while domestic rental and management segment Operating Profit increased 7.0% to $400.9 million. Domestic rental and management segment Operating Profit Margin was 78%. International Rental and Management Segment – International rental and management segment revenue increased 32.9% to $261.8 million, which represented 33% of total revenues. International rental and management segment pass-through revenues increased 43.2% to $69.7 million. In addition, international rental and management segment Gross Margin increased 27.8% to $166.1 million, while international rental and management segment Operating Profit increased 28.8% to $136.5 million. International rental and management segment Operating Profit Margin was 52% (71%, excluding the impact of $69.7 million of pass-through revenues). Network Development Services Segment – Network development services segment revenue was $25.3 million, which represented 3% of total revenues. Network development services segment Gross Margin was $15.0 million, and network development services segment Operating Profit was $12.1 million. Network development services segment Operating Profit Margin was 48%. Please refer to “Non-GAAP and Defined Financial Measures” on pages 5 and 6 for definitions of Gross Margin, Operating Profit, Operating Profit Margin, Adjusted EBITDA, Adjusted EBITDA Margin, NAREIT Funds From Operations, Adjusted Funds From Operations, Adjusted Funds From Operations per Share, Core Growth and Net Leverage Ratio. For additional financial information, including reconciliations to GAAP measures, please refer to the unaudited selected financial information on pages 11 through 14. INVESTING OVERVIEW Distributions – On April 25, 2013, the Company paid its first quarter distribution to stockholders of record at the close of business on April 10, 2013 of $0.26 per share, or approximately $102.8 million. Cash Paid for Capital Expenditures – During the first quarter of 2013, total capital expenditures of $123.9 million included $57.3 million for discretionary capital projects, including spending to complete the construction of 48 towers and the installation of 3 distributed antenna system networks and 124 shared generators domestically and the construction of 393 towers and the installation of 8 distributed antenna system networks internationally; $14.8 million to purchase land under the Company’s communications sites; $21.7 million for the redevelopment of existing communications sites to accommodate new tenant equipment; and $23.4 million for capital improvements and corporate capital expenditures. To provide further transparency of capital expenditures incurred in connection with recently announced new markets or acquisitions, the Company is introducing a new category of capital expenditures, “Start-Up Capital Projects.” Included in this category are expenditures that are specific to acquisitions and new market launches and that are contemplated in the business cases for these investments. Examples of these costs include spending to upgrade acquired assets for security purposes or meet Company structural specifications or to open offices within the local market. During the first quarter of 2013, spending on Start-Up Capital Projects totaled $6.7 million. Cash Paid for Acquisitions – During the first quarter of 2013, the Company spent $245.1 million for the purchase of 2 domestic towers and 898 international towers. These international towers consisted of those acquired pursuant to previously announced agreements, including 885 towers in Mexico and 13 towers in Colombia. During the first quarter of 2013, the Company added 20 towers to its domestic portfolio as part of a previously announced transaction. The construction of these sites, which were acquired as work in progress sites during the fourth quarter of 2012, was completed in the first quarter of 2013. Stock Repurchase Program – During the first quarter of 2013, the Company repurchased a total of approximately 0.2 million shares of its common stock for approximately $12.5 million pursuant to its stock repurchase program. Between April 1, 2013 and April 19, 2013, the Company repurchased approximately 0.2 million additional shares of its common stock for an aggregate of approximately $16.1 million. FINANCING OVERVIEW Leverage – For the quarter ended March 31, 2013, the Company’s net leverage ratio was approximately 4.0x net debt (total debt less cash and cash equivalents) to first quarter 2013 annualized Adjusted EBITDA. Liquidity – As of March 31, 2013, the Company had approximately $2.1 billion of total liquidity, comprised of approximately $441.7 million in cash and cash equivalents and the ability to borrow an aggregate of approximately $1.7 billion under its two revolving credit facilities, net of any outstanding letters of credit. In March 2013, the Company completed the refinancing of its $1.75 billion securitization with the proceeds from the private offering of$1.8 billionaggregate principal amount ofSecured Tower Revenue Securities, Series 2013-1A and Series 2013-2A. As a result, the weighted average maturity was extended to 8.6 years and the weighted average interest rate was reduced to 2.648%. FULL YEAR 2013 OUTLOOK The following estimates are based on a number of assumptions that management believes to be reasonable and reflect the Company’s expectations as of May 1, 2013. Actual results may differ materially from these estimates as a result of various factors, and the Company refers you to the cautionary language regarding “forward-looking” statements included in this press release when considering this information. The Company’s outlook has been updated to reflect the issuance of the Secured Tower Revenue Securities; the introduction of a new category of capital expenditures, “Start-up Capital Projects”; and is based on the following average foreign currency exchange rates to 1.00 U.S. Dollar for the remainder of the year 2013: (a) 2.00 Brazilian Reais; (b) 475.00 Chilean Pesos; (c) 1,800.00 Colombian Pesos; (d) 0.78 Euros; (e) 1.90 Ghanaian Cedi; (f) 54.00 Indian Rupees; (g) 12.25 Mexican Pesos; (h) 2.55 Peruvian Soles; (i) 9.00 South African Rand; and (j) 2,600.00 Ugandan Schillings. Midpoint Midpoint ($ in millions) Full Year 2013 Growth Core Growth Total rental and $3,160 to $3,210 13.6% 16.4% management revenue Adjusted EBITDA $2,080 to $2,130 11.2% 14.7% ^(1) Adjusted Funds From $1,420 to $1,470 18.2% 19.6% Operations^(1) Net Income $765 to $840 35.1% N/A _____ (1) See “Non-GAAP and Defined Financial Measures” below. The Company’s outlook for total rental and management revenue reflects the following at the midpoint: (1) domestic rental and management segment revenue of $2,080 million; and (2) international rental and management segment revenue of $1,105 million, which includes approximately $285 million of pass-through revenue. The calculation of midpoint Total Rental and Core Growth is as follows: Management Adjusted AFFO (Totals may not add due to Revenue EBITDA rounding.) Outlook midpoint Core 16.4% 14.7% 19.6% Growth Estimated impact of fluctuations in foreign (0.1)% 0.1% 0.0% currency exchange rates Impact of straight-line revenue and expense (2.0)% (2.5)% - recognition Impact of significant (0.6)% (1.0)% (1.3)% one-time items Outlook midpoint growth 13.6% 11.2% 18.2% Outlook for Capital Expenditures: ($ in millions) Full Year 2013 (Totals may not add due to rounding.) Discretionary capital projects^(1) $ 240 to $ 300 Ground lease purchases 85 to 105 Start-up capital projects^(2) 20 - 20 Redevelopment 95 to 105 Capital improvement 85 to 95 Corporate 25 - 25 Total $ 550 to $ 650 _____ (1) Includes the construction of approximately 2,250 to 2,750 new communications sites. (2) Includes costs associated with acquisitions and newly launched markets. Reconciliations of Outlook for Net Income to Adjusted EBITDA: ($ in millions) (Totals may not add due to rounding.) Full Year 2013 Net income $ 765 to $ 840 Interest expense 420 to 410 Depreciation, amortization and accretion 755 to 725 Stock-based compensation expense 65 - 65 Other, including other operating expenses, interest income, loss on retirement of long-term obligations, (income) loss on equity 75 to 90 method investments, other (income) expense and income tax provision (benefit) Adjusted EBITDA $ 2,080 to $ 2,130 Reconciliations of Outlook for Net Income to Adjusted Funds From Operations: ($ in millions) Full Year 2013 (Totals may not add due to rounding.) Net income $ 765 to $ 840 Straight-line revenue (135 ) - (135 ) Straight-line expense 31 - 31 Depreciation, amortization and accretion 755 to 725 Stock-based compensation expense 65 - 65 Non-cash portion of tax provision 5 to 10 Other, including other operating expenses, interest expense, amortization of deferred financing costs, capitalized interest, debt 44 to 54 discounts and premiums, loss on retirement of long-term obligations and other (income) expense Capital improvement capital expenditures (85 ) to (95 ) Corporate capital expenditures (25 ) - (25 ) Adjusted Funds From Operations $ 1,420 to $ 1,470 Conference Call Information American Tower will host a conference call today at 8:30 a.m. ET to discuss its financial results for the first quarter ended March 31, 2013 and its outlook for the full year 2013. Supplemental materials for the call will be available on the Company’s website, www.americantower.com. The conference call dial-in numbers are as follows: U.S./Canada dial-in: (866) 740-9153 International dial-in: (706) 645-9644 Passcode: 41016400 When available, a replay of the call can be accessed until 11:59 p.m. ET on May 15, 2013. The replay dial-in numbers are as follows: U.S./Canada dial-in: (855) 859-2056 International dial-in: (404) 537-3406 Passcode: 41016400 American Tower will also sponsor a live simulcast and replay of the call on its website, www.americantower.com. About American Tower American Tower is a leading independent owner, operator and developer of wireless and broadcast communications real estate. American Tower currently owns and operates approximately 56,000 communications sites in the United States, Brazil, Chile, Colombia, Germany, Ghana, India, Mexico, Peru, South Africa and Uganda. For more information about American Tower, please visit www.americantower.com. Non-GAAP and Defined Financial Measures In addition to the results prepared in accordance with generally accepted accounting principles in the United States (GAAP) provided throughout this press release, the Company has presented the following non-GAAP and defined financial measures: Gross Margin, Operating Profit, Operating Profit Margin, Adjusted EBITDA, Adjusted EBITDA Margin, NAREIT Funds From Operations, Adjusted Funds From Operations, Adjusted Funds From Operations per Share, Core Growth and Net Leverage Ratio. The Company uses Funds From Operations as defined by the National Association of Real Estate Investment Trusts (NAREIT), referred to herein as NAREIT Funds From Operations. The Company defines Gross Margin as revenues less 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 Operating Profit as Gross Margin less selling, general, administrative and development expense, excluding stock-based compensation expense and corporate expenses. For reporting purposes, the international rental and management segment Operating Profit and Gross Margin also include interest income, TV Azteca, net. These measures of Gross Margin and Operating Profit are also before interest income, interest expense, loss on retirement of long-term obligations, other income (expense), net income attributable to non-controlling interest, income (loss) on equity method investments and income taxes. The Company defines Operating Profit Margin as the percentage that results from dividing Operating Profit by revenue. The Company defines Adjusted EBITDA as net income before income (loss) from discontinued operations, net, income (loss) from equity method investments, income tax provision (benefit), other (income) expense, loss on retirement of long-term obligations, interest expense, interest income, other operating expenses, depreciation, amortization and accretion and stock-based compensation expense. The Company defines Adjusted EBITDA Margin as the percentage that results from dividing Adjusted EBITDA by total revenue. NAREIT Funds From Operations is defined as net income before gains or losses from the sale or disposal of real estate, real estate related impairment charges and real estate related depreciation, amortization and accretion, and including adjustments for unconsolidated affiliates and noncontrolling interest. The Company defines Adjusted Funds From Operations as NAREIT Funds From Operations before straight-line revenue and expense, stock-based compensation expense, the non-cash portion of our tax provision, non-real estate related depreciation, amortization and accretion, amortization of deferred financing costs, capitalized interest and debt discounts and premiums, other (income) expense, loss on retirement of long-term obligations, other operating (income) expense, unconsolidated affiliates, and noncontrolling interest, less cash payments related to capital improvements and cash payments related to corporate capital expenditures. The Company defines Adjusted Funds From Operations per Share as Adjusted Funds From Operations divided by the diluted weighted average common shares outstanding. The Company defines Core Growth in total rental and management revenue, Adjusted EBITDA and Adjusted Funds From Operations as the increase or decrease, expressed as a percentage, resulting from a comparison of financial results for a current period with corresponding financial results for the corresponding period in a prior year, in each case, excluding the impact of straight-line revenue and expense recognition, foreign currency exchange rate fluctuations and significant one-time items. The Company defines Net Leverage Ratio as net debt (total debt, less cash and cash equivalents) divided by last quarter annualized Adjusted EBITDA. These measures are not intended to replace financial performance measures determined in accordance with GAAP. Rather, they are presented as additional information because management believes they are useful indicators of the current financial performance of the Company’s core businesses. The Company believes that these measures can assist in comparing company performances on a consistent basis irrespective of depreciation and amortization or capital structure. Depreciation and amortization can vary significantly among companies depending on accounting methods, particularly where acquisitions or non-operating factors, including historical cost bases, are involved. Notwithstanding the foregoing, the Company’s measures of Gross Margin, Operating Profit, Operating Profit Margin, Adjusted EBITDA, Adjusted EBITDA Margin, NAREIT Funds From Operations, Adjusted Funds From Operations, Adjusted Funds From Operations per Share, Core Growth and Net Leverage Ratio may not be comparable to similarly titled measures used by other companies. Cautionary Language Regarding Forward-Looking Statements This press release contains "forward-looking statements" concerning our goals, beliefs, expectations, strategies, objectives, plans, future operating results and underlying assumptions, and other statements that are not necessarily based on historical facts. Examples of these statements include, but are not limited to statements regarding our full year 2013 outlook, foreign currency exchange rates and our expectation regarding the declaration of regular distributions. Actual results may differ materially from those indicated in our forward-looking statements as a result of various important factors, including: (1) decrease in demand for our communications sites would materially and adversely affect our operating results and we cannot control that demand; (2) new technologies or changes in a tenant’s business model could make our tower leasing business less desirable and result in decreasing revenues; (3) our business is subject to government regulations and changes in current or future laws or regulations could restrict our ability to operate our business as we currently do; (4) if our tenants consolidate, merge or share site infrastructure with each other to a significant degree, our growth, revenue and ability to generate positive cash flows could be materially and adversely affected; (5) we could suffer adverse tax or other financial consequences if taxing authorities do not agree with our tax positions; (6) a substantial portion of our revenue is derived from a small number of tenants, and we are sensitive to changes in the creditworthiness and financial strength of our tenants; (7) our foreign operations are subject to economic, political and other risks that could materially and adversely affect our revenues or financial position, including risks associated with fluctuations in foreign currency exchange rates; (8) our expansion initiatives involve a number of risks and uncertainties that could adversely affect our operating results, disrupt our operations or expose us to additional risk if we are not able to successfully integrate operations, assets and personnel; (9) if we are unable to protect our rights to the land under our towers, it could adversely affect our business and operating results; (10) increasing competition in the tower industry may create pricing pressures that may materially and adversely affect us; (11) if we are unable or choose not to exercise our rights to purchase towers that are subject to lease and sublease agreements at the end of the applicable period, our cash flows derived from such towers would be eliminated; (12) if we elect not to qualify as a REIT or fail to remain qualified as a REIT, we would be subject to tax at corporate income tax rates, which would substantially reduce funds otherwise available; (13) we may be limited in our ability to fund required distributions using cash generated through our TRSs; (14) complying with REIT requirements may limit our flexibility or cause us to forego otherwise attractive opportunities; (15) certain of our business activities may be subject to corporate level income tax and foreign taxes, which reduce our cash flows, and may have deferred and contingent tax liabilities; (16) we may need additional financing to fund capital expenditures, future growth and expansion initiatives and to satisfy our REIT distribution requirements; (17) our leverage and debt service obligations may materially and adversely affect us; (18) restrictive covenants in the loan agreement related to our securitization transaction, the loan agreements for our credit facilities and the indentures governing our debt securities could materially and adversely affect our business by limiting flexibility; (19) we may incur goodwill and other intangible asset impairment charges which could result in a significant reduction to our earnings; (20) we have limited experience operating as a REIT, which may adversely affect our financial condition, results of operations, cash flow and ability to satisfy debt service obligations; (21) we could have liability under environmental and occupational safety and health laws; (22) our towers or data centers may be affected by natural disasters and other unforeseen events for which our insurance may not provide adequate coverage; and (23) our costs could increase and our revenues could decrease due to perceived health risks from radio emissions, especially if these perceived risks are substantiated. For additional information regarding factors that may cause actual results to differ materially from those indicated in our forward-looking statements, we refer you to the information contained in Item 1A of our Form 10-K for the year ended December 31, 2012. We undertake no obligation to update the information contained in this press release to reflect subsequently occurring events or circumstances. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) March 31, December 31, 2013 2012(1) ASSETS Current assets: Cash and cash equivalents $441,706 $368,618 Restricted cash 46,733 69,316 Short-term investments 13,004 6,018 Accounts receivable, net 145,446 143,772 Prepaid and other current 232,110 222,851 assets Deferred income taxes 24,617 25,754 Total current assets 903,616 836,329 Property and equipment, net 5,879,513 5,796,517 Goodwill 2,898,638 2,881,959 Other intangible assets, net 3,271,981 3,136,602 Deferred income taxes 215,559 209,257 Deferred rent asset 811,903 776,201 Notes receivable and other 482,530 452,788 non-current assets Total $14,463,740 $14,089,653 LIABILITIES: Current liabilities: Accounts payable $86,769 $89,578 Accrued expenses 263,187 287,575 Distributions payable 103,095 189 Accrued interest 80,065 71,271 Current portion of long-term 57,603 60,031 obligations Unearned revenue 148,405 124,147 Total current liabilities 739,124 632,791 Long-term obligations 8,791,520 8,693,345 Asset retirement obligations 455,982 435,635 Other non-current liabilities 695,592 643,701 Total liabilities 10,682,218 10,405,472 COMMITMENTS AND CONTINGENCIES EQUITY: Common stock 3,966 3,959 Additional paid-in capital 5,029,261 5,012,124 Distributions in excess of (1,128,361) (1,196,907) earnings Accumulated other comprehensive (158,043) (183,347) loss Treasury stock (75,208) (62,728) Total American Tower 3,671,615 3,573,101 Corporation equity Noncontrolling interest 109,907 111,080 Total equity 3,781,522 3,684,181 Total $14,463,740 $14,089,653 _____ (1)December 31, 2012 balances have been revised to reflect purchase accounting measurement period adjustments. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) Three Months Ended March 31, 2013 2012 REVENUES: Rental and management $777,433 $683,990 Network development services 25,295 12,527 Total operating revenues 802,728 696,517 OPERATING EXPENSES: Costs of operations (exclusive of items shown separately below): Rental and management including stock-based compensation expense of $246 and $197, 191,295 163,724 respectively) Network development services (including stock-based compensation expense of $192 and $264, 10,471 7,261 respectively) Depreciation, amortization and accretion 185,804 149,655 Selling, general, administrative and development expense (including stock-based compensation expense 101,153 79,584 of $20,604 and $12,584, respectively) Other operating expenses 14,319 21,847 Total operating expenses 503,042 422,071 OPERATING INCOME 299,686 274,446 OTHER INCOME (EXPENSE): Interest income, TV Azteca, net 3,543 3,543 Interest income 1,714 2,253 Interest expense (111,766) (95,117) Loss on retirement of long-term obligations (35,298) (398) Other income (including unrealized foreign currency 22,291 52,861 gains $22,143 and $55,838, respectively) Total other expense (119,516) (36,858) INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND INCOME ON EQUITY METHOD INVESTMENTS 180,170 237,588 Income tax provision (19,222) (27,248) Income on equity method investments - 18 NET INCOME 160,948 210,358 Net loss (income) attributable to noncontrolling 10,459 10,948 interest NET INCOME ATTRIBUTABLE TO AMERICAN TOWER CORPORATION $171,407 $221,306 NET INCOME PER COMMON SHARE AMOUNTS: Basic net income attributable to American Tower $0.43 $0.56 Corporation Diluted net income attributable to American Tower $0.43 $0.56 Corporation WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: BASIC 395,239 393,885 DILUTED 399,659 398,453 DISTRIBUTIONS DECLARED PER SHARE $0.26 $0.21 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Three Months Ended March 31, 2013 2012 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $160,948 $210,358 Adjustments to reconcile net income to cash provided by operating activities: Stock-based compensation expense 21,042 13,045 Depreciation, amortization and accretion 185,804 149,655 Loss on early retirement of securitized debt 35,288 - Other non-cash items reflected in statements of (7,496) (28,342) operations Increase in net deferred rent asset (26,806) (28,789) Decrease (increase) in restricted cash 22,583 (13,490) (Increase) decrease in assets (7,374) 55,126 Increase in liabilities 10,047 44,454 Cash provided by operating activities 394,036 402,017 CASH FLOWS FROM INVESTING ACTIVITIES: Payments for purchase of property and equipment (123,905) (121,032) and construction activities Payments for acquisitions, net of cash acquired (245,094) (159,403) Proceeds from sale of short-term investments and 7,150 1,095 other non-current assets Payments for short-term investments (14,650) (10,085) Deposits, restricted cash, investments and other (129) (1,871) Cash used for investing activities (376,628) (291,296) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from short-term borrowings, net - 17,127 Borrowings under credit facilities 249,000 1,325,000 Proceeds from issuance of senior notes, net 983,354 698,670 Proceeds from issuance of Securities in 1,778,496 - securitization transaction, net Proceeds from other long-term borrowings - 16,676 Repayments of notes payable, credit facilities (2,937,744) (2,018,847) and capital leases Contributions from noncontrolling interest 7,658 3,327 holders, net Purchases of common stock (12,480) (20,665) Proceeds from stock options 6,140 15,615 Payment for early retirement of securitized debt (29,234) - Deferred financing costs and other financing (10,561) (9,463) activities Cash provided by financing activities 34,629 27,440 Net effect of changes in foreign currency 21,051 2,906 exchange rates on cash and cash equivalents NET INCREASE IN CASH AND CASH EQUIVALENTS 73,088 141,067 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 368,618 330,191 CASH AND CASH EQUIVALENTS, END OF PERIOD $441,706 $471,258 CASH PAID (RECEIVED) FOR INCOME TAXES, NET OF $13,543 $(897) REFUNDS CASH PAID FOR INTEREST $95,251 $77,936 UNAUDITED RESULTS OF OPERATIONS, BY SEGMENT (In thousands, except percentages) Three Months Ended, March 31, 2013 Rental and Management Network Development Total Domestic International Total Services Segment revenues $515,676 $261,757 $777,433 $25,295 $802,728 Segment operating 91,833 99,216 191,049 10,279 201,328 expenses(1) Interest income, - 3,543 3,543 - 3,543 TV Azteca, net Segment Gross 423,843 166,084 589,927 15,016 604,943 Margin Segment selling, general, administrative and development 22,898 29,535 52,433 2,901 55,334 expense(1) Segment Operating $400,945 $136,549 $537,494 $12,115 $549,609 Profit Segment Operating 78% 52% 69% 48% 68% Profit Margin Three Months Ended, March 31, 2012 Rental and Management Network Development Total Domestic International Total Services Segment revenues $487,062 $196,928 $683,990 $12,527 $696,517 Segment operating 93,003 70,524 163,527 6,997 170,524 expenses(1) Interest income, - 3,543 3,543 - 3,543 TV Azteca, net Segment Gross 394,059 129,947 524,006 5,530 529,536 Margin Segment selling, general, administrative and development 19,400 23,895 43,295 358 43,653 expense(1) Segment Operating $374,659 $106,052 $480,711 $5,172 $485,883 Profit Segment Operating 77% 54% 70% 41% 70% Profit Margin _____ Excludes (1 ) stock-based compensation expense. UNAUDITED SELECTED FINANCIAL INFORMATION (In thousands, except where noted. Totals may not add due to rounding.) Selected Balance Sheet Detail: Long-term obligations summary, including current portion March 31, 2013 2011 Credit Facility $- 2012 Credit Facility 322,000 2012 Term Loan 750,000 4.625% Senior Notes due 2015 599,676 7.000% Senior Notes due 2017 500,000 4.500% Senior Notes due 2018 999,440 7.250% Senior Notes due 2019 296,388 5.050% Senior Notes due 2020 699,353 5.900% Senior Notes due 2021 499,370 4.700% Senior Notes due 2022 698,787 3.500% Senior Notes due 2023 992,007 Total unsecured debt at American Tower Corporation 6,357,021 Secured Tower Revenue Securities, Series 2013-1A 500,000 Secured Tower Revenue Securities, Series 2013-2A 1,300,000 Unison Notes(1) 206,750 South African facility(2) 90,326 Colombian long-term credit facility(2) 73,682 Colombian bridge loans(2) 51,312 Shareholder loans(3) 211,150 Capital lease obligations 58,882 Total secured, subsidiary or other debt $2,492,102 Total debt $8,849,123 Cash and cash equivalents 441,706 Net debt (Total debt less cash and cash equivalents) $8,407,417 The Unison Notes are secured debt and were assumed as a result of the (1) acquisition of certain legal entities holding a portfolio of property interests from Unison Holdings LLC and Unison Site Management II, L.L.C. (2) Denominated in local currency. (3) Denominated in USD, reflects balances attributable to minority shareholder loans in the Company’s joint ventures in Colombia, Ghana and Uganda. Three Months Ended Calculation of Net Leverage Ratio ($ in thousands) March 31, 2013 Total debt $8,849,123 Cash and cash equivalents 441,706 Numerator: net debt (total debt less cash and cash $8,407,417 equivalents) Adjusted EBITDA $524,394 Denominator: annualized Adjusted EBITDA 2,097,576 Net leverage ratio 4.0x UNAUDITED SELECTED FINANCIAL INFORMATION (In thousands, except where noted. Totals may not add due to rounding.) Three Months Ended Share count rollforward: (in millions of shares) March 31, 2013 Total common shares, beginning of period 395.1 Common shares repurchased (0.2) Common shares issued 0.7 Total common shares outstanding, end of period (1) 395.6 As of March 31, 2013, excludes (a) 4.0 million potentially dilutive shares associated with vested and exercisable stock options with an average (1) exercise price of $39.50 per share, (b) 3.0 million potentially dilutive shares associated with unvested stock options, and (c) 1.8 million potentially dilutive shares associated with unvested restricted stock units. Total rental and management straight-line revenue and expense: In accordance with GAAP, the Company recognizes consolidated rental and management revenue and expense related to non-cancellable tenant and ground lease agreements with fixed escalations on a straight-line basis, over the applicable lease term. As a result, the Company’s revenue recognized may differ materially from the amount of cash collected per tenant lease, and the Company’s expense incurred may differ materially from the amount of cash paid per ground lease. Additional information regarding straight-line accounting can be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 in the section entitled "Revenue Recognition," in note 1, “Business and Summary of Significant Accounting Policies,” within the notes to the consolidated financial statements. A summary of total rental and management straight-line revenue and expense, which represents the non-cash revenue and expense recorded due to straight-line recognition, is as follows: Three Months Ended March 31, 2013 2012 Total rental and management operations straight-line $34,240 $38,503 revenue Total rental and management operations straight-line 7,115 9,735 expense Three Months Ended March 31, Selling, general, administrative and development 2013 2012 expense breakout: Total rental and management overhead $52,433 $43,295 Network development services segment overhead 2,901 358 Corporate and development expenses 25,215 23,347 Stock-based compensation expense 20,604 12,584 Total $101,153 $79,584 Three Months Ended March 31, International pass-through revenue detail: 2013 2012 Pass-through revenue $69,651 $48,626 SELECTED CASH FLOW DETAIL: Three Months Ended March 31, Payments for purchase of property and equipment and 2013 2012 construction activities: Discretionary capital projects $57,270 $63,738 Ground lease purchases 14,800 14,714 Start-up capital projects 6,723 1,627 Redevelopment 21,712 22,812 Capital improvements 15,882 13,929 Corporate 7,518 4,212 Total $123,905 $121,032 UNAUDITED SELECTED FINANCIAL INFORMATION (In thousands, except where noted. Totals may not add due to rounding.) SELECTED STATEMENT OF OPERATIONS DETAIL: The following table reflects the estimated impact of foreign currency exchange rate fluctuations, straight-line revenue and expense recognition and material one-time items on total rental and management revenue, Adjusted EBITDA and AFFO: The calculation of Core Growth is as follows: Total Rental and Adjusted Management EBITDA AFFO Three Months Ended March 31, 2013 Revenue Core Growth 20.3% 19.6% 20.9% Estimated impact of fluctuations in foreign currency exchange (2.2)% (1.6)% (2.5)% rates Impact of straight-line revenue (1.6)% (1.4)% - recognition Impact of material one-time items (2.7)% (3.1)% (8.5)% Reported growth 13.7% 13.4% 9.9% SELECTED PORTFOLIO DETAIL: Tower Count(1): As of As of December Constructed Acquired Adjustments March 31, 31, 2012 2013 United 22,534 48 22^(3) (5) 22,599 States(2) Brazil 4,345 25 - - 4,370 Chile 1,181 1 - (1) 1,181 Colombia 3,004 24 13 - 3,041 Germany 2,031 - - - 2,031 Ghana 1,926 4 - (1) 1,929 India 10,378 307 - - 10,685 Mexico(4) 5,777 14 885 (3) 6,673 Peru 500 - - (1) 499 South Africa 1,604 17 - - 1,621 Uganda 1,043 1 - - 1,044 Total 54,323 441 920 (11) 55,673 _____ (1) Excludes in-building and outdoor distributed antenna system networks. (2) United States tower count includes 275 broadcast towers. Includes 20 towers that were acquired during the fourth quarter of 2012 as (3) work in progress sites and were completed during the first quarter of 2013. (4) Mexico tower count includes 199 broadcast towers. UNAUDITED RECONCILIATIONS TO GAAP MEASURES AND THE CALCULATION OF DEFINED FINANCIAL MEASURES (In thousands, except per share data and percentages. Totals may not add due to rounding.) The reconciliation of net income to Adjusted EBITDA and the calculation of Adjusted EBITDA Margin are as follows: Three Months Ended March 31, 2013 2012 Net income $160,948 $210,358 Income from equity method - (18) investments Income tax provision 19,222 27,248 Other income (22,291) (52,861) Loss on retirement of long-term 35,298 398 obligations Interest expense 111,766 95,117 Interest income (1,714) (2,253) Other operating expenses 14,319 21,847 Depreciation, amortization and 185,804 149,655 accretion Stock-based compensation 21,042 13,045 expense Adjusted EBITDA $524,394 $462,536 Divided by total revenue 802,728 696,517 Adjusted EBITDA Margin 65% 66% The reconciliation of net income to NAREIT Funds From Operations and the calculation of Adjusted Funds From Operations and Adjusted Funds From Operations per Share are presented below: Three Months Ended March 31, 2013 2012 Net Income $160,948 $210,358 Real estate related depreciation, amortization and 163,742 132,832 accretion Losses from sale or disposal of real estate and real 269 3,815 estate related impairment charges Adjustments for unconsolidated affiliates and 2,830 6,617 noncontrolling interest NAREIT Funds From Operations 327,789 353,622 Straight-line revenue (34,240) (38,503) Straight-line expense 7,115 9,735 Stock-based compensation expense 21,042 13,045 Non-cash portion of tax provision 5,679 28,145 Non-real estate related depreciation, amortization and 22,062 16,823 accretion Amortization of deferred financing costs, capitalized 7,527 1,852 interest and debt discounts and premiums(1) Other income (2) (22,291) (52,861) Loss on retirement of long-term obligations 35,298 398 Other operating expense (3) 14,050 18,032 Capital improvement capital expenditures(4) (15,882) (13,929) Corporate capital expenditures (7,518) (4,212) Adjustments for unconsolidated affiliates and (2,830) (6,617) noncontrolling interest Adjusted Funds From Operations $357,801 $325,530 Divided by weighted average diluted shares outstanding 399,659 398,453 Adjusted Funds From Operations per Share $0.90 $0.82 _____ (1) Includes accrued non-cash interest expense attributable to joint-venture loans. (2) Primarily includes unrealized (gain) loss on foreign currency exchange rate fluctuations. (3) Primarily includes impairments and transaction related costs. (4) 2012 amounts adjusted to exclude the new category of capital expenditures, Start-Up Capital Projects. Contact: American Tower Corporation Leah Stearns, 617-375-7500 Vice President, Investor Relations & Capital Markets
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American Tower Corporation Reports First Quarter 2013 Financial Results
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