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ATC Q1 outlook hurt by India telco exits

The first quarter results and outlook for 2019 of American Tower Corp. (ATC) have been hurt by the fall in tenancies due to the stiff competition-induced rapid consolidation in the Indian telecom industry, which has more than halved the number of operators to three in just over two years. The company’s operational and financial results during the first quarter of 2019 were impacted by churn driven by this carrier consolidation process.

For the quarter, the turmoil in the Indian industry affected ATC’s total quarterly property revenue by USD 89 million, while impact on adjusted EBITDA was USD 61 million, which on consolidated adjusted funds from operations (AFFO) was USD 49 million and on tenant billings was USD 67 million. The company’s first quarter net income was USD 408 million, up 45 percent on year, on total revenue of USD 1813 million, a rise of 4.1 percent. Total property revenue was USD 1786 million, 4.4 percent while adjusted EBITDA rose 4.9 percent to USD 1114 million.

The expected 2019-specific impacts of ICCC (churn in India) to property revenue, adjusted EBITDA and consolidated AFFO are USD 191 million, USD 148 million, and USD 118 million, respectively, including USD 22 million in lower pass-through revenue. It expects the negative impact consolidation in India to last throughout 2019 and anticipates that churn rates in India will return to lower levels in 2020 and beyond.

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