SBA Communications today reported results for the quarter ended June 30, 2021 — including a net income of $152.7 million or $1.37 per share, AFFO per share growth of 15.3 percent over the prior year period, and total revenue of $575.5 million.
SBA Communication’ second quarter performance beat analysis prediction of $0.68 per share, according to figures compiled by Thomson Reuters. The company also raised its outlook for the full year 2021, adjusting funds from operations of $10.32 to $10.72 per share and revenues of $2.26 billion to $2.30 billion.
In addition, SBA Communications today also disclosed that its board of directors has declared a quarterly cash dividend of $0.58 per share of the company’s Class A Common Stock. The distribution is payable September 23, 2021, to the shareholders of record at the close of business on August 26, 2021. Further, the digital infrastructure REIT (real estate investment trust) issued $1.165 billion of Tower Securities at an interest rate of 1.631 percent and completed extension and expansion of $1.5 billion Revolving Credit Facility subsequent to quarter end.
During the second quarter, SBA Communications — like the two other REIT giants, American Tower and Crown Castle — began to fully reap the benefits from the 5G building boom the wireless industry.
Jeffrey Stoops, president and CEO of SBA Communications, believes the second quarter was the start of a multiyear business expansion for both tower builders and carriers — and that the next two quarters will increase sequentially.
“Our second-quarter performance was our best in quite some time,” Stoops said. “U.S. wireless carrier activity increased substantially in the quarter. Domestically, we produced record services revenue, we had the highest revenue added per tower based on signed leases and amendments since 2014, and our leasing and services backlogs were at multi-year highs at quarter end. While this increased leasing activity will benefit our reported 2021 revenue, the majority of the incremental revenue will begin to be recognized in 2022.”
Stoops continued, “Based on our backlogs and conversations with our customers, we expect elevated leasing activities to continue through 2022 and perhaps beyond. All of our U.S. wireless carrier customers are actively engaged in building out their 5G networks and we are committed and have the resources to help them achieve their goals…Right now, our customers are focused on building 5G macro sites.”
SBA Communications’ total revenues in the second quarter of 2021 were $575.5 million compared to $507.2 million in the second quarter of 2020, an increase of 13.5 percent. Site leasing revenue in the second quarter of 2021 of $524.1 million was comprised of domestic site leasing revenue of $418.8 million and international site leasing revenue of $105.3 million.
Domestic cash site leasing revenue in the second quarter of 2021 was $408.3 million compared to $387.1 million in the prior year period, an increase of 5.5 percent. International cash site leasing revenue in the second quarter of 2021 was $106.3 million compared to $95.0 million in the prior year period, an increase of 11.9 percent, or an increase of 8.3 percent on a constant currency basis. Site development revenues in the second quarter of 2021 were $51.4 million compared to $24.8 million in the prior year period, an increase of 107.2 percent.
During the second quarter of 2021, SBA acquired 57 communication sites for total cash consideration of $67.0 million. SBA also built 98 towers during the second quarter of 2021. As of June 30, 2021, SBA owned or operated 33,854 communication sites, 17,306 of which are located in the United States and its territories, and 16,548 of which are located internationally. In addition, the Company spent $11.8 million to purchase land and easements and to extend lease terms. Total cash capital expenditures for the second quarter of 2021 were $108.0 million, consisting of $10.2 million of non-discretionary cash capital expenditures (tower maintenance and general corporate) and $97.8 million of discretionary cash capital expenditures (new tower builds, tower augmentations, acquisitions, and purchasing land and easements).
Mike Harrington is a contributing editor.