Sites Latam grows footprint but loses contracts in Brazil, Panama

Sites Latam continued to expand its tower portfolio in the first quarter of the year, but lost key leasing contracts in Brazil and Panama due to telecom M&A movements.

A spin-off of Mexico's América Móvil, the firm reported 35,380 sites in its portfolio, up by 245 from the previous quarter and 1,040 from 1Q23, according to the company's quarterly report.

These include 11,405 sites in Brazil; 9,176 in Chile, Ecuador, Peru and Colombia (Andean region); 7,854 in Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama (Central America); 5,441 in Argentina, Uruguay, and Paraguay (AUP); and 1,504 in Puerto Rico and the Dominican Republic (Caribbean).

“As anticipated, the loss of contracts in Brazil continued to impact during the quarter,” the report said.

From January to March, 192 individual site agreements were canceled following the rearrangement of networks after Oi’s acquisition by Claro, TIM and Vivo, according to Sites.

Meanwhile in Panama, Liberty Latin America's Cable & Wireless (C&W) canceled 58 individual site agreements that overlapped its network following the absorption of Claro’s local operation. 

“Contract cancellation in Panama occurred only after the agreed early termination fee was paid; we do not expect any further cancellations resulting from this transaction,” Sites said.

Earlier this year, Phoenix Tower International (PTI) agreed to buy 1,300 mobile sites upfront from Liberty Latin America in Panama, as well as in Jamaica, The Bahamas, Puerto Rico, Barbados and the British Virgin Islands.

PORTFOLIO GROWTH

The Andean region and Central America were the fastest-growing Q1 operations for Sites in Latin America, contributing 126 and 96 new builds, respectively, said the company. 

In sales terms and total tower count, Brazil remained Sites’ biggest market, contributing 699mn Mexican pesos (US$40.8mn) to the consolidated Ebitda of the quarter, the firm reported.

Yet, because of Oi's churn, tower leasing revenues in Brazil contracted by 6.6% year-on-year and 3.4% quarter-on-quarter.

Sites’ Q1 revenues reached 3.42bn pesos, up 8.5% year-over-year, with tower leasing revenues contributing 2.12bn pesos and increasing by 11.4%.

As per occupancy, Central America ended the quarter with an average of 1.22 tenants (users) per tower, surpassing the 1.12 reported in the previous year, mainly driven by El Salvador, Guatemala and Honduras.