Brazil, South Africa boost SBA's international tower business

Brazil and South Africa drove a “very solid quarter” for Florida-based wireless infrastructure provider SBA Communications, CEO Jeffrey Stoops said.

While acknowledging persisting COVID-19 impacts in Latin America, Stoops said SBA was well positioned to benefit from increased network investment of its carrier customers as conditions improve and new spectrum auctions take place over the next year, including a planned 5G one in Brazil.

“During the quarter, we signed up 45% of new international revenue through new leases and 55% through amendments to existing leases. Our increased leasing results were driven by our two largest markets, Brazil and South Africa,” the CEO told investors in the company's Q2 earnings call.

Total revenues were US$576mn, up 13.5% year-over-year. Site leasing revenue totaled $524mn, US$419mn of which coming from the US and US$105mn the international business.

During the quarter, 84.8% of consolidated cash site leasing revenue was denominated in US dollars. Most revenue not denominated in US-dollar came from Brazil. 

The country represented 11.5% of consolidated cash site leasing revenues in Q2 and 8.4% of cash site leasing revenue, according to SBA.

“In Brazil, our largest international market, we had an improved quarter of leasing activity. Gross same-tower organic growth in Brazil was 8.9% on a constant currency basis,” Stoops said.

During the quarter, SBA built 98 towers globally and bought 57 communication sites for US$67mn. 

In addition, the company said it spent US$11.8mn to purchase land and easements and to extend lease terms. 

Total cash capital expenditures were US$108mn in Q2, US$97.8mn for discretionary capital expenditures like tower builds, augmentations, acquisitions, and purchasing land and easements, mostly in the US.

As of June 30, SBA owned or operated 33,854 communication sites, 17,306 of which in the US and its territories, and 16,548 internationally, most of these in Latin America, particularly Brazil.

The company also announced its entry into Tanzania through a local partner in Q2.

The positive scenario also led SBA to slightly increase its full-year outlook. The company now expects global revenues of US$2.3bn, up from US2.26bn previously.

SBA’s operations and main offices are in the US, Brazil, Canada, Argentina, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Nicaragua, Panama, Peru and South Africa.