During its third quarter 2019 earnings call, Uniti Group reported favorable demand across its business units, which include Uniti Fiber, Uniti Towers and Uniti Leasing.
Macrotower, Small Cell Backhaul Contract
Uniti Fiber recently signed a contract with a major wireless customer to deploy 800 combined macro backhaul and small cell sites across its Southeast fiber footprint, adding $500,000 of monthly recurring revenue once all sites are delivered over the next three years.
“This agreement demonstrates the continued need for wireless carriers to densify their networks as they move towards a broader rollout of 5G wireless services,” commented Kenny Gunderman, Uniti president and CEO.
During the quarter, the Company closed on its sale-leaseback and fiber acquisition with Bluebird Network, through an OpCo/PropCo partnership with Macquarie Infrastructure Partners. Uniti acquired approximately 178,000 fiber strand miles in the Midwest across Missouri, Kansas, Illinois and Oklahoma. In addition, the Company completed the sale of its Uniti Fiber Midwest operations to MIP, while Uniti retained the ownership of its existing Midwest fiber network. The Company is leasing the Bluebird fiber network and its Midwest fiber network, on a combined basis, to MIP under a long-term triple net lease, and is included within the results of Uniti Leasing. The results of our Midwest operations have been excluded from the results of Uniti Fiber, subsequent to closing on August 30, 2019.
March 9, 2017 —
Communications Sales & Leasing (CS&L) announced that it has changed its corporate name to Uniti Group to align itself the brand names of its principal business units – Uniti Towers, Uniti Fiber and Uniti Leasing, during its fourth quarter 2016 earnings call. Uniti Group now trades under the symbol “UNIT” (NASDAQ: UNIT). The Company’s new website is www.uniti.com.
As of Jan. 31, 2017, Uniti owned 468 towers. Company CEO Kenny Gunderman said he is “cautiously optimistic” about the company’s towers, during the call. “The opportunity to build new macro towers and the United States that will be integral parts of the coming 5G investment cycle is not only an opportunity itself, but we believe will also feed additional fiber opportunities as front-haul and CRAN architectures become more prevalent through small cells and traditional backhaul,” Gunderman said.
Uniti Towers’ acquisition of the Network Management Services (NMS) tower portfolio (in Mexico, Nicaragua and Columbia) closed at the end of January for $62.6 million. At closing, the NMS portfolio included 366 operating towers and 105 towers under development, all of which we expect to be completed in 2017.
Uniti Towers projects revenue between $7 million to $8 million for full year 2017, principally from the NMS towers, with tower cash flow margins of 59 percent. Adjusted EBITDA in 2017 is expected to be near breakeven, as the company prepares for growth in the future.
“We expect Uniti Towers to win additional opportunities for build-to-suit towers in Mexico and in the United States this year,” Gunderman said. “Our Uniti Towers 2017 capital spend guidance is $25 million to $30 million, including $10 million related to the NMS development towers.”
Additionally, Uniti Towers expects $20 million of ground lease investments during 2017 at an average initial yield of 6 percent.
November 17, 2016 — CS&L announced on Monday that its U.S. and Latin American tower and tower real estate assets will operate under the brand of Uniti Towers. Including assets from the Network Management Holdings acquisition (see story above), Uniti Towers has nearly 600 macro towers and more than 1,000 ground lease or tower-ready locations.
“The Uniti Tower strategy is to acquire and construct tower and tower real estate in the United States and Latin America,” Kenny Gunderman, president and CEO of CS&L, said during the Q3 earnings call. “We will focus on markets with strong macroeconomic fundamentals, politically stable environments and strong underlying communications growth trends.
“Specifically, we will focus on competitive communications markets where numerous investment grade international wireless carriers operate and where there is strong communications infrastructure potential due to underpenetrated 4G or even 3G technology,” he added.
Uniti Tower’s strategy includes providing build-to-suit tower construction in both in the United States and Latin America.
“Particularly with the entrance of AT&T into Latin America, we believe that our strategy of focusing on fiber and towers in the United States and Latin America is highly synergistic and will drive incremental attractive growth opportunities,” Gunderman said.
Lawrence Gleason has been named president of Uniti Towers. He joined CS&L when it acquired Summit Infrastructure earlier this year. Before being CEO and founder of Summit Infrastructure, he was with a large tower company for 13 years where he managed over 20,000 towers.
“We’re pleased to have Lawrence in this role and look forward to growing the business under his leadership,” Gunderson said. “In a short period of time, we have already made great progress on our Uniti Towers strategy.”