American Tower Corporation (REIT) (AMT)

AMT 
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American Tower Corp. (AMT)

F1Q09 Earnings Call Transcript

April 29, 2009 at 8:30 am ET

Executives

Jim Taiclet - Chairman, President, and Chief Executive Officer

Thomas Bartlett - Chief Financial Officer

Jean Bua - Executive Financial Officer

Michael Powell - Vice President of Investor Relations

Analysts

David Barden - BAS-ML

Brett Feldman - Barclays Capital

Jason Armstrong - Goldman Sachs

Otto Bohman - Jefferies & Co.

Jonathan Atkin - RBC Capital Markets

Presentation

Operator

Ladies and gentlemen, my name is Alexandria and I will be your conference operator. At this time, I would like to welcome everyone to the American Tower first quarter 2009 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will a question-and-answer session. (Operator's instruction).

I would now like to turn the conference to our host, Mr. Michael Powell, Vice President of Investor Relations. Mr. Powell, please go ahead.

Michael Powell

Thank you, Alexandria. Good morning everyone and thank you for joining American Tower’s conference call regarding our first quarter 2009 financial results. Please note that we had posted a brief presentation to accompany this morning's call in the Company's website which is www.americantower.com. If you have not done so already, you may want to download this presentation as we will refer to it at the various times during our prepared remarks.

The agenda for this morning's call will be as follows: First, I will provide a brief introduction and highlight certain key metrics for our first quarter 2009 financial results. Following this, Tom Bartlett, our Chief Financial Officer will go over our first quarter results in more detail and provide additional color on our 2009 outlook and Jim Taiclet, our Chairman, President, and Chief Executive Officer will then give closing remarks including his current thought and key business trends. After these comments, we will of course open up the call to your questions.

However, before I begin, I would like to remind you that this call will contain forward-looking statements that involve a number of risks and uncertainties. Examples of these statements include statements regarding our 2009 outlook, our stock repurchase program, foreign currency exchange rates, credit markets and any other statements regarding matters that are not historical facts.

You should be aware that certain factors may affect us in the future and could cause actual results to differ materially from those expressed in these forward-looking statements. Such factors include the risk factors set forth in this morning's press release and those set forth in our Form 10-Q for the year ended December 31, 2008, and our other filings with the SEC.

We urge you to consider these factors and remind you that we undertake no obligation to update this information contained in the call to reflect subsequently occurring events or circumstances. And with that I would like to begin the call. Please turn to slide four of the presentation for a summary of our first quarter 2009 results compared against the first quarter of 2008.

American Tower reported strong operating results for the first quarter of 2009 despite unfavorable foreign currency exchange rates and a challenging economic environment. Our rental and management segment reported revenues of approximately $396 million reflecting a 6% growth rate from the year ago period. Please note that the first quarter growth was negatively impacted by the strength of the US dollar against the Mexican peso and the Brazilian Real along with the negative impacts of straight line revenue recognition. Tom will provide further details regarding the impacts of these factors on the reported results.

The Company's adjusted EBITDA for the quarter was approximately $281 million which is a 7% increase from the year ago period. Additionally, our operating income for the quarter increased 4% to approximately $159. Please note that this profitability measure was negatively impacted by a $6.6 million nonrecurring charge to stock-based compensation expense which is related to the modification of certain stock option awards for a member of senior management who terminated his employment agreement during the quarter. Moreover, we reported strong growth and net income from continuing operations of approximately 32% which is actually a 40% increase on a per diluted share basis.

Tom, I now would like to turn the call over to you for further detail.

Thomas Bartlett

Thanks Michael and good morning everyone. I am very pleased to be with all of you this morning. Now, having been here for just a month, I am even more excited about the prospects for American Tower and its ability to generate significant value for our shareholders. The fundamental business model that American Tower is clearly unique within the telecom sector which includes recurring long-term cash flow streams with built in contractual revenue escalations, the lion share of the cash flow being generated from strong institutional telecom carriers with the service model developed by American Tower in the US that can be deployed anywhere on the globe and with the sales and support staff who were incredibly energetic and have built the culture to produce an outstanding customer experience.

As the CFO, I plan to build upon this model and continue to focus on creating shareholder value. I know that you expect us to leave the market not only in value creation but also in financial discipline and transparency. My goal is to exceed your expectations and I look forward to spending time with you in the months ahead.

Before I get started in reviewing our results, I also wanted to thank Jean Bua who has worn several hats for us in American Tower over the last several months. Jean has clearly helped the Company in advancing its leadership role within the industry and has brought tremendous financial discipline across the entire operation. I plan to continue to build upon this legacy and look forward to working with Jean in her current role as treasurer.

Read the rest of this transcript for free on seekingalpha.com