Q4 2021 American Tower Corp Earnings Call
Ladies and gentlemen, thank you for standing by welcome to the American Tower fourth quarter and full year 2021 earnings Conference call. As a reminder, today's conference call.
Is being recorded.
Slowing the prepared remarks, we will open the call for questions if you'd like to ask a question. Please press one than zero and you won't be acknowledged Thats. Your line has been placed in queue I would now like to turn the call over to your host Adam Smith, Vice President of Investor Relations. Please go ahead Sir.
Good morning, and thank you for joining American tower's fourth quarter and full year 2021 earnings conference call.
We have posted a presentation, which we will refer to throughout our prepared remarks under the Investor Relations tab of our website Www Dot American tower Dot com.
On this morning's call Tom Bartlett, our president and CEO will provide an update on our stand and deliver strategy.
And then Rod Smith, our executive Vice President CFO , and Treasurer will discuss our 2021 results in 2022 outlook.
After these comments, we will open up the call for your questions.
Before we begin I'll remind you that our comments contain forward looking statements that involve a number of risks and uncertainties exist.
Examples of these statements include our expectations regarding future growth.
<unk>, our 2022 outlook capital allocation and future operating performance.
Our expectations regarding the financing plan for the core site acquisition.
Our expectations regarding the impacts of COVID-19.
And any other statements regarding matters that are not historical facts.
You should be aware that certain factors may affect us in the future and could cause actual results to differ materially from those expressed in these forward looking statements.
Such factors include risk factors set forth in this morning's earnings press release.
Those that will be set forth in our upcoming Form 10-K for the year ended December 31, 2021 and in other filings, we make with the SEC.
We urge you to consider these factors and remind you that we undertake no obligation to update the information contained in this call to reflect subsequent events or circumstances.
With that I'll turn the call over to Tom.
Thanks, Adam and good morning, everyone. As you saw in today's press release, we generated strong results in 2021, while strategically deploying capital to assets that we believe will further enhance our future growth trajectory and augment our ability to continue to deliver compelling total shareholder returns for many years to come.
The strength of our operational and financial results reflects the high quality nature of our tower business model the dedication of our talented global teams and our commitment to provide best in class service to our customers.
It also reflects our commitment to sustainability and being a good corporate citizen, which provides additional purpose and continues to be a focus at every level of the organization.
Last year at this time.
We presented multiyear targets for U S organic tenant billings growth in <unk> per share growth and I am pleased to be able to say that we're exactly where we thought we would be today as it relates to those targets.
We continue to expect to average at least 4% in U S organic tenant billings growth from 2021 through 2027 on a reported basis, implying an average of at least 5% excluding the impacts of sprint churn in.
And as part of these projections, we anticipate an acceleration in U S organic tenant billings growth between 2023, and 2027, we were targeting growth rates of at least 5% on a reported basis and at least 6% excluding the sprint churn similar.
Similarly on the <unk> side of the equation. We believe we are on track to average at least 10% growth in <unk> per share on average through 2027. This includes a year of more subdued growth in 2022 as expected, but also a recovery in growth rates in 2023 and beyond as the.
Sprint churn impacts fade and global secular growth tailwind continue.
<unk> is probably the most significant of these growth drivers and in 2021, we show the early stages of transformation of IAG network upgrades in multiple markets.
Including nearly $105 billion spent by U S carriers for critical mid band spectrum and over $65 billion in Capex deployed by carriers into network investments across our global footprint.
Mobile data consumption is expected to grow at an average annual rate of more than 25% over the next five years in the United States and at even higher rates than some of our international markets. We anticipate prolong network investment cycles to drive compelling sustained growth rates across our regions.
While we believe our macro tower assets will continue to drive the vast majority of growth and returns for the company as <unk> advances. We're also excited about additional opportunities that we expect to arise from the accelerating cloud based interconnected and globally distributed digital transformation that is in its early stages today.
We expect our recently closed <unk> acquisition to augment our ability to capture potential upside from this transformation, while enhancing the value of our existing portfolio of distributed communications real estate overtime.
We anticipate these expectations to be underpinned by the continued execution of the four strategic pillars, and our stand and deliver strategy.
Growing our assets and capabilities driving industry leadership operational efficiency and extending our platform.
As part of our commitment to growing our assets and capabilities to meet our customers' needs. We deployed more than $10 billion for tower M&A in 2021 focused on Europe , where we have meaningfully improved our long term strategic positioning we.
We saw accelerated organic growth trends in the region throughout the last year and we expect those trends to continue supported by data growth projected at a CAGR of 26% over the next five years across our major European markets separately, we added strategic financial partners CDP Q Alley.
<unk>.
Who joined our existing partner PGM, creating a solid platform for future growth and investment ahead of what we anticipate being an exciting decade in the European marketplace.
In addition to expanding through M&A. We further grew our asset base through our internal Capex program by investing $1 4 billion, primarily to construct a record of nearly 6400, new communication sites, along with deploying nearly $120 million towards our energy efficiency investments primarily.
In Africa.
These investments continue to generate returns that are among the highest in our portfolio.
Through our talented teams and operational expertise, we expect to remain a preferred partner to support customers as they execute on their network build outs, which we expect to drive continued acceleration in our new site construction for the next several years, while advancing our sustainability efforts and commitment to a greener mobile future.
<unk>.
Through our commitment to enhance our industry leadership, we've continued our focus on sustainability by accelerating our efforts to combat climate change as evidenced by our recent adoption of science based targets for carbon emission reductions. These.
These targets represent direct and indirect greenhouse gas emissions reduction targets of at least 40% by 2035 against the 2019 baseline as well as targets to reduce indirect supply chain emissions by at least 40%.
To date, we've invested over $275 million in capex towards energy efficiency and reduction solutions, which directly support our committed targets and initiatives.
Concurrent with our emissions reduction targets and renewable energy investments, we are actively working on various land stewardship and social impact initiatives.
We are a member of the World Economic Forum's Edison Alliance 1 billion lives challenge, which aims to spur development of affordable and accessible digital solutions across health finance and education to the underserved.
Through our involvement we engaged within our array of high level country and regional platforms and committed our time expertise and ideas to make digital access a top priority for all.
Also this past year American tower was awarded a 2021 World Summit on the information Society Prize for our digital communities program, which.
Which spans across India Africa, and Latin America, and seeks to improve the quality of life and increased economic opportunity to connectivity.
At the end of 2021, we reached a significant milestone of launching our 200 digital community in India and have set a goal to grow to 2000 digital communities globally over the next five years, focusing on education health care access financial inclusion and career development.
Finally, we advanced our commitment to diversity equity and inclusion by implementing customized plans focused on talent development recruitment and education to enhance our inclusive culture across our global footprint.
We also continued our partnership with HBC, you supporting critical infrastructure enhancement projects and engaging in academic and professional development opportunities for their talented students.
Further we extended our leadership position in NAREIT dividends through diversity equity and inclusion CEO Council, which addresses opportunities related to Eni in the REIT and publicly traded real estate industry.
Also we stay on top of the best ESG practices policies and actions within the REIT sector through active participation on NAREIT counsels and initiatives.
These accomplishments and areas of focus are reflections of our unwavering commitment to operating our global business in a sustainable way, while guided by our core principles.
We are also steadfast and driving operational efficiency throughout the business over.
Over the past several years, we've implemented shared service center models executed on various cost control and process improvement initiatives and implemented site level enhancements to not only drive value to American tower, but also for our customers. An example of these initiatives is our use of drone technology to help us ensure the structure.
<unk> integrity of our sites in 2021, our U S team demonstrated its capabilities to scale up driving service revenue to its highest level in over a decade and supporting major carrier activity in preparation for <unk> deployments.
Looking ahead, we believe the investments we have made in the operating structures and processes that have been put in place are competitive advantages that will facilitate scalable expansion, while converting meaningful topline growth to <unk>.
At the same time through our platform expansion initiatives, we've evaluated a range of new communications real estate models to identify long term growth opportunities that could complement and leverage our global tower presence further advance our position as a market leader ahead of emerging technological trends and create attractive.
Turns for our stakeholders.
Through this process, we believe advanced wireless network technologies in conjunction with the shift of computing power from the core to the edge will accelerate digital transformation across many industries, we've only begun to understand the true capabilities and performance of widespread <unk> coverage and with new applications on the horizon.
We think mobile edge computing will become a critical component of converged neutral host infrastructure.
We believe todays <unk> edge deployed in public or private networks with regional site hosting.
Evolve to distributed tower centric locations.
We think future AI and machine learning edge optimized solutions supporting massive Iot devices, and immersive experiences enabled with AR and VR, such as gaming health care and education will drive latency latency sensitive edge deployments across our strategically positioned set of assets.
We expect this evolution and these deployments to drive a meaningful Tam with our distributed macro tower assets ideally located to host such computing infrastructure and an integrated grid that enhances our competitive position and service offerings.
Together with the core site and our other data center assets, we have the scale to enable originally interconnected hub and spoke edge computing model that extends today's data center multi cloud ecosystem out to our distributed neutral host sites greatly enhancing our probability of success at the edge.
On that note I'd like to welcome the <unk> team to the American Tower family and together I look forward to executing on our long term development plan, while driving meaningful incremental value to our macro tower sites over time.
As we move forward, we remain focused on further enhancing our investment grade balance sheet, which has been a critical element. It has enabled us to grow and we expect it to remain an important component of our future success as well.
We are committed to maintaining our investment grade credit rating and with the strength of our balance sheet as our foundation, we will continue to apply our stand and deliver strategic framework to capture value as <unk> and growing mobile demand present compelling growth opportunities for American tower.
In closing, we believe that our comprehensive global portfolio strong balance sheet prudent capital allocation strategy and continued focus on sustainability position us to extend our track record of driving solid growth and returns as we embark upon an exciting new era of digital transformation enabled by <unk>.
We will continue to execute on our stand and deliver strategy and follow the same values and discipline that have fueled our track record over the last two decades.
As we continue to build and strengthen our diverse comprehensive portfolio, while enhancing our operational capabilities. We believe American tower is well positioned to support our global customer base as we enter a hyper connected digitally driven world.
With that let me turn the call over to Rod to go through our 2021 results and the details of our 2022 outlook.
Rod.
Thanks, Tom and thanks, everyone for joining our call today I Hope you and your families are well as you just heard from Tom American Tower had another year of solid performance, which included strong Q4 results throughout our global business.
Before we dive into the details of our expectations for 2022, I'll briefly review, our Q4 and full year 2021 results.
To start I'd like to highlight a few key accomplishments from the past year.
2021 marked another year of strong over achievement against our initial <unk> per share targets for the full year, we posted consolidated and attributable to <unk> per share growth of 13, 7% and 11, 7% respectively.
This is a demonstration of our ability to deliver solid total revenue growth tightly manage operating costs and execute on strategically important M&A transactions, all while maintaining a thoughtful and disciplined approach to our capital structure.
I'll also note. This is a great start towards achieving our previously stated objective of delivering on average double digit <unk> per share growth between 2021 and 2027.
Second we delivered our third consecutive year of record new builds as.
As we've discussed previously these newly constructed sites continue to be amongst our best uses of capital in 2021, we saw average day, one NOI yield of nearly 12% over the nearly 6400 sites we constructed.
Finally during 2021, we completed two strategic M&A transactions and as a result strengthened our position in the United States in Europe , two critically important markets for us.
With that let's dive into the details of our Q4 and full year 2021 results.
Turning to slide eight in the fourth quarter, our consolidated property revenues grew by more than 13% year over year or over 14% on an FX neutral basis.
In our U S and Canada segment property revenue grew one 2%. This included in organic tenant billings growth decline of 5% or an increase of over 4% when excluding the impacts of sprint churn.
As a reminder over half of the total sprint churn commenced in 2021, primarily on October one as expected.
International property revenues grew over 28% with nearly 20% driven by contributions from our <unk> assets International organic tenant billings growth was five 7% led by Latin America at seven 4% followed by Africa at seven 3% and Europe at six six.
<unk>.
APAC grew for the second consecutive quarter coming in at one 3%.
This was complemented by the addition of nearly 1900 high yielding newly constructed sites across our international markets.
Moving to adjusted EBITDA growth was over 10% in the quarter.
While the impacts of sprint churn combined with the addition of newer lower tenancy assets drove a decline in adjusted EBITDA margin to 62%.
Finally, consolidated <unk> per share grew three 8% in the quarter or four 3%, excluding the negative impacts of foreign currency fluctuations. This.
This included nearly $140 million of year on year cash adjusted EBITDA growth, which was partially offset by the higher net cash interest expense, along with higher cash taxes and maintenance costs.
As anticipated the timing of these expenses was heavily backend weighted in 2021, resulting in a material impact to the year over year growth rates in Q4.
Meanwhile, <unk> per share attributable to American tower common stockholders grew by one 4% in the quarter.
Turning to slide nine full year consolidated property revenue growth was 14, 5%, including organic tenant billings growth of three 8% and total tenant billings growth of 11, 3%.
U S and Canada property revenue growth was nearly 9% with organic tenant billings growth of two 9%. This included contributions from co locations and amendments of three 2% another 3% in growth from escalators around 2% and negative impacts from other run rate items in churn of <unk>.
<unk>, 3%, which consisted of around one 8% in normal course churn and the balance driven by sprint. This was complemented by new assay contributions to tenant billings of four 1% and approximately $144 million in higher straight line revenues as compared to 2020.
Our.
National property revenue grew by over 21% with organic tenant billings growth of five 5% for the year.
Overall, Colocation and amendment growth was five 9%, while three 8% came from escalators and <unk>, 3% from other run rate items, all of which was partially offset by four 5% of churn.
This elevated churn was primarily concentrated in India.
Where more recently, we have started to see the churn rate moderate.
Finally, with our recent expanded data center portfolio, we have introduced a new data center segment within total property <unk>.
Consisting of the newly acquired core site and data site assets, along with our existing Colo ATL facility.
This segment contributed approximately $23 million to our total property revenue in 2021.
Turning to slide 10.
Adjusted EBITDA grew 16% for the year to nearly $6 billion. This.
This included strong flow through of organic tenant billings growth.
$100 million in incremental services gross margin versus 2020.
Over $140 million in net straight line growth as well as around $300 million in contributions to growth from newly acquired assets, primarily in the U S and Europe .
On a consolidated basis adjusted EBITDA margins were down around 20 basis points as compared to 2020, primarily due to the impacts of sprint churn in the U S. And the addition of newer lower tenancy international assets, which we believe are well positioned to drive meaningful margin expansion over time.
We also grew consolidated <unk> by 15, 4% and consolidated <unk> per share by 13, 7% in 2021 with over $680 million in cash adjusted EBITDA growth from the drivers I just mentioned.
This growth was partially offset by higher financing costs associated with our recent strategic M&A as well as a modest increase in maintenance capex and higher cash tax expenses compared to 2020.
Finally, <unk> attributable to A&P common stockholders per share grew 11, 7% year over year.
With that let's turn to our outlook for 2022.
I'll start by highlighting a few key assumptions underlying our projections.
First we expect a strong year of new leasing activity across our operations with anticipated gross new business contributions to total tenant billings growth nearly 7% higher than what we saw in 2021.
This expectation is being driven by a few key items in the U S. The comprehensive MLA as we've signed over the last few years are continuing to result in solid levels of new business activity.
In Europe , we expect an exceptionally strong year boosted by our larger presence following the <unk> transaction.
And across our developing market footprint the demand for site continues to rise as next generation network deployments advance.
Second we expect churn to be higher than historical levels in 2022 in the United States. This will be driven by sprint churn we have discussed previously.
With about $160 million in year over year impacts in 2022 for 2021.
Additionally, in select international markets, a handful of carrier consolidation events are temporarily driving churn higher.
Third.
We've layered in some preliminary assumptions related to our core site financing.
And finally, our initial outlook reflects estimated negative translational FX impacts of approximately $125 million for property revenue $70 million for adjusted EBITDA and $55 million for consolidated <unk> for 2021.
Moving into the details on slide 11, you can see we expect total property revenues of over $10 $3 billion at the midpoint representing.
Representing growth of 13% or nearly 15% on a currency neutral basis.
This includes expected property revenue growth of less than 1% in the U S and Canada and over 14% of FX neutral growth in our international regions. We also expect data centers to contribute roughly $705 million of growth in cash revenue to the property segment in 2022.
Turning to slide 12, and unpacking the property revenue growth assumptions, a bit youll see our expected organic tenant billings growth rates for 2022.
I'd like to note here that our tenant billings metrics do not include contributions from the datacenter segment.
Looking at the United States, and Canada, we anticipate growth of approximately 1% in line with the 2022 expectations implied in the long term projections. We presented last year. This includes contributions to growth from co locations and amendments of roughly $150 million representing solid double.
<unk> growth versus 2021, we.
We expect this to be partially offset by churn of over 5%, which includes a three 7% impact associated with sprint.
Turning to Latin America, we expect organic tenant billings growth of greater than 6% for the year supported by solid growth Colocation and amendment activity as well as additional growth from our CPI based escalators, which we anticipate to be around 300 basis points higher than in 2021.
These items are being partially offset by higher churn in 2022, primarily related to telefonica in Mexico as well as the continuation of Nextel churn in Brazil with both events, we expect to receive settlement payments over the course of 2022 compensating us for the early termination of leases ahead of their exploration where applicable.
<unk>.
As is typical these payments will fall outside of the organic tenant billings growth metrics.
Moving to Africa.
Organic tenant billings growth is expected to be in the 6% range. We continue to see strong demand for our macro tower assets driving Colocation and amendment growth of around six 5% for the year. In addition, we expect escalators to be up as compared to 2021 by roughly 90 basis points. This will be.
Partially offset by an expectation for elevated churn as carrier consolidation and some smaller market exit events from Q4 of 2021 Workday way through our 2022 financial metrics.
Meanwhile, in Europe , we're seeing the benefits of added scale from the <unk> acquisition. The early stages of <unk>, Rollouts and low churn all driving expected organic tenant billings growth of approximately 9% in 2022.
This includes roughly 6% and contributions from co locations and amendments and escalators of around four 5%.
These higher escalators are being driven by the combination of higher CPI and the mechanics of having the <unk> assets in our numbers for the full year of 2022.
<unk> is expected to decline to around one 5% as we benefit from the lower churn <unk> assets and reduced cancellations across our legacy business as carrier consolidation events wind down.
Finally in Asia Pacific, we're guiding to 2% to 3% organic tenant billings growth in 2022.
Including churn of around 5% representing less than half of the 2021 churn rate at the same time, our outlook does imply a reduction to gross Colocation and amendment growth contributions relative to 2021 levels as carriers in the marketplace continued to digest recent developments with that said.
We are encouraged by the market reforms aimed at improving the overall health of the telecom sector as well as more recent steps taken by the carriers to rationalize pricing and improve overall profitability in the marketplace. We think these steps could bode well for the long term growth picture in India.
Turning to slide 13.
At the midpoint of our outlook, we are projecting adjusted EBITDA of over $6 5 billion, representing year over year growth of 10% or nearly 11% on a constant currency basis. We continue to drive solid organic growth conversion rates and are complementing this through growth on assets acquired in 2021, including.
<unk> $360 million in expected adjusted EBITDA from core site in 2022, we are seeing some margin compression in 2022. This.
This is primarily the result of sprint churn in the U S. Along with a full year impact of the slightly lower margin core site in <unk> assets that said the benefits of our continued focus on operational efficiency are taking hold and our regional legacy businesses, particularly in Africa, where our commitment to.
Sustainable energy solutions and strong cost controls are driving meaningful expansion in margins.
Turning to slide 14, we expect consolidated <unk> to grow by more than $380 million to over $4 7 billion.
<unk> absorbing approximately $160 million of negative impacts to <unk> from sprint churn. This includes $675 million and FX neutral cash adjusted EBITDA growth and the expectation for maintenance capex to be more or less flat as compared to 2021 as capital intensity.
<unk> in the 2% range we.
We expect this to be partially offset by approximately $55 million and higher cash taxes and $185 million in incremental cash interest expense, primarily associated with our preliminary core site financing assumption as well as roughly $55 million in expected negative translational FX impacts.
Additionally, we've layered in a common stock issuance assumption for the purposes of outlook in the first half of 2022 again tied to the core site transaction.
Taking these assumptions into account, we expect our consolidated <unk> per share for the year to be $10 five.
Reflecting growth of 4% or roughly 8%, excluding the impacts of sprint churn.
Finally, <unk> attributable to AMC common stockholders is expected to grow approximately 3% year over year to $9 70 per share in 2022.
This includes an assumption of approximately $165 million in minority interest impacts related to our partnerships in Europe .
Moving on to Slide 15, Let's review our capital deployment in 2021 and expectations for 2022.
In 2021, we declared nearly $2 $4 billion of common dividend distributions, representing a year over year growth rate of 15%.
We spent another $1 $4 billion through our capex programs over $500 million of which was dedicated towards development projects, including the construction of nearly 6400, new sites across the globe. Finally, we deployed over $20 billion, including the assumption of debt.
To acquire the <unk> and core site assets as well as a handful of smaller transactions around the world. We expect these new assets to drive meaningful accretion and shareholder value over time.
Looking to 2022.
Our dividend remains a top priority and subject to board approval, we expect to distribute approximately $2 8 billion to our shareholders. As we continue to increase the dividend in line with our stated long term double digit growth targets. We also expect to deploy roughly $2 $1 billion in capital expenditures over 90.
Percent of which will be discretionary.
Of our total discretionary capital spending we expect approximately $270 million to be directed towards attractive organic development opportunities in our data Center segment.
On the tower side, we expect to deploy roughly $565 million in development Capex, primarily for the construction of 6500 sites in our international segment.
Similar to 2021, we anticipate driving average day, one NOI yields on these new builds of nearly 12%.
As you can see on the chart to the right. These international New site investments have driven exceptional returns over time in our earliest vintage we're seeing average NOI yield of 46%.
Sites built between 2010, and 2014 are yielding around 26% and on the more than 26000 sites. We've constructed since the start of 2015, we're seeing yields in the 20% range with room to expand as we continue to drive lease up on these lower tenured sites.
Looking forward, we believe our international Newbuild program presents a significant opportunity to continue adding meaningful portfolio scale, while achieving highly attractive returns.
And we will continue to prioritize site development opportunities is a key part of our capital allocation strategy over the long term.
Turning now to slide 16, we've laid out our current thoughts around the permanent financing strategy for our core site acquisition.
As always the primary objective is for us to finance this transaction in a way that optimizes, our capital structure within our investment grade framework minimizing dilution to our common stockholders and positions us to continue to opportunistically deploy capital in ways that maximize value creation for our shareholders over the long term.
At a high level, we expect to get there through a combination of debt and equity issuances the debt markets remain attractive and as we have done in the past we expect to be opportunistic as we seek to term out revolver and term loan borrowings into longer term fixed rate instruments on the equity side, we anticipate.
A number of alternatives, including common equity mandatory convertible preferreds and private capital partnerships much like we did for the <unk> acquisition in 2021.
With that said for the purposes of our initial 2022 outlook, we have assumed that roughly half of the $10 billion purchase price will be financed through a common equity issuance assumed to occur in the first half of 2022 as you can see on the slide we anticipate that this will bring our leverage back down to the high <unk>.
Five times range, while putting us on track to get back to five times or below all with a slightly longer term importantly, we remain committed to our investment grade rating and have been working closely with the rating agencies throughout this process.
As we continue to evaluate a number of potential options, particularly on the equity side, we will plan to keep you all updated as to our progress in the meantime, we believe that the baseline case, we have incorporated in our current outlook positions us well as we create long term shareholder value with the core site assets.
Turning now to slide 17 and in summary.
We drove strong results in 2021, including compelling double digit <unk> per share growth record newbuild activity prudent balance sheet management and the completion of several transactions that we believe will enhance American tower's leading global position.
As we look across our global footprint, we're encouraged by what we see as a long tailwind of secular technology trends that are expected to drive continued strong recurring demand for our critical communications infrastructure assets.
In the U S and Europe , we're well positioned to support a continued acceleration in <unk> activity as carriers deploy new spectrum assets and build out Greenfield networks. Meanwhile, in our early stage markets, we expect to benefit as operators look to upgrade and densify their mobile networks to meet ever increasing mobile data demand.
<unk> all of which we believe will translate into meaningful growth and attractive total shareholder returns at American tower for many years to come.
And with that operator, we can open up the lines for questions.
Thank you, ladies and gentlemen, once again, if you would like to ask a question. Please press. One then zero on your telephone keypad, you will hear acknowledgment that your line has been placed in Q you may remove yourself from the queue by pressing the one zero key again and.
And we will go to the line of Simon Flannery with Morgan Stanley . Please go ahead.
Great. Thank you very much and good morning.
You talked about some of the deals you had been doing over 2021 and I wanted to get a sense of your how you're thinking about M&A from here, there's a lot of portfolios available in Europe , obviously, the public equity valuations have pulled back so I'm not sure if there's been an adjustment on the private side as well, but how are you.
Thinking about the opportunities out there to continue to build your business.
Optimal mix between regions.
Assets are over.
Over the medium term and then just a housekeeping question for you Ron you talked about some of the churn in Latin America, you didn't call out or any update on what the recent doi transaction not through the regulatory approvals means for this.
This year and beyond.
Sure John I'll do the first and then Rod you can talk about.
Our Latin America.
With regard to M&A I mean, it's no different than we are.
<unk> been looking at things for the last two decades, you know that we are.
Because of our sheer size and our presence we get invited into looking at.
Every transaction that we see going on around the around the planet.
And and we evaluate them we have business development teams and every one of our every one of our markets clearly the focus for us right now.
Looking at opportunities in Europe .
But it's as a result of the <unk> transaction and what we've done there before we do have terrific scale.
In some of the critical markets in that region and as you saw Rogers talk about we're seeing really as we expected given where the markets are from a <unk> perspective, it's really outsized growth.
In 2022 going going forward is as the spectrum is deployed and as <unk> gets rolled out.
And as you said there there are a lot of portfolios there.
And we are looking at all of them a lot of it we've seen it in the public realm.
We've had ongoing discussions but clearly.
We're looking at it very very carefully looking at what would be the real opportunity there going forward a very disciplined look in terms of valuation.
So it's really impossible at this point in time to speculate in terms of success in those but we will clearly evaluate them and look at them in and.
Determine whether we can create long term value as a result of those transactions.
We have a very diverse portfolio, which is really proven to be I think very valuable over the last 10 years as we've looked at the growth across across the regions that we have.
And Europe had been that particular market, where we did not have the significant presence and and now we do and we're taking advantage of that growth.
So we'll continue to evaluate those opportunities and as I said, it's really difficult to predict what.
What the outcomes might be.
But we'll continue to take a very disciplined review of those options.
Hey, good morning, Thanks for the thanks for the question I Hope Youre doing well so in Latin America, and just to recap here, we're guiding towards just above 6% organic tenant billings growth and that's really driven by solid organic.
New bids so we've got about three 3% or so contributing from an organic new <unk> perspective, and we're also seeing outsized escalators. So we've got escalators in above 8% in that market.
So a nice strong escalators, there that really is sort of an inflation hedge that we have in the Latin American market, but we are seeing temporary.
Elevated churn so we've got about 5% churn coming out of Latin America. The churn that's in the outlook for 2022 is primarily telefonica up in Mexico, and then next nail down in Brazil, or it doesn't really play into that into the equation quite yet we do have a long term contract with Hawaii. So that'll play out over the next seven years there.
So.
And we'll see where that goes I don't want to get ahead of anything that may happen in the market there from irregular regulatory perspective, but it's not really a main component in our 2022 numbers and we've got protection there out over seven years and the way revenue is is in and around 1% of our total.
Total revenue.
Alright, Thank you Rob.
And our next question is from Michael Rollins with Citi. Please go ahead.
Thanks, and good morning, I'm curious.
Unpack a little bit more of the demand.
These levels and.
AT&T talking about.
Starting to deploy in the second half for mid band.
Deploying their network and Verizon continuing to build out the C band.
T mobile.
Yeah.
Expanding and integrating can you give us a sense of sort of what activity levels or activity.
In the number and if there's some opportunity depending on how does that work their way through the system to influence performance this year and heading into next year.
Yeah. Good morning, Michael Nice to nice to have you on the call. Thanks for joining and thanks for the question.
U S market in terms of organic gross growth organic new business is really quite strong we continue to see all of the major carriers being very active in the place that that shows up initially maybe as they are.
An early indicator here within our services business. So once again, we're guiding towards in our services revenue above $220 million.
So still well above kind of historical levels, a little bit below where we were in 2021.
But still a nice solid level of services activity in the margins there are still coming in at 55% rate with a right where they normally do and then when you think about the U S organic growth here we're guiding.
Towards 1% or so and I'll give you the piece parts. There so organic new business is slightly up from where it was from the prior year in terms of percentage basis. So that's about three 3% escalators are holding very firm slightly ahead of where they were in 2021 theyre coming in at three 1% and then we have cancellations coming.
In and about five a little over 5% and that is primarily driven at least the outsized churn. There is primarily driven through the sprint churn that we've all that we've all talked about in terms of going forward. You do know that we've got MLA as with most of our carriers, where we've got kind of locked in revenue as well as revenue growth.
Three quarters of the ramp.
As is in there even in our long term guide we do have about two thirds or so not only the underlying revenue in the guide, but the actual growth locked up in L. A so nice.
Clear visibility in terms of the growth that we see going out we do have one customer that's on an Ala carte basis, though as they begin to deploy we do expect that to ramp towards the back half of the year and we also have the agreement with dish, which we've talked about in the past that is beginning to produce revenue for us this year that will.
Delayed through the year. So we will see a ramp up during the year from that and then it will continue to ramp over time and that's what really gives us the confidence to put out the long term growth rates that Tom talked about and getting back up into that mid single digit growth rates sustainably.
In the U S. And then the final point that I would make is the collocation and amendment contributions to organic new business for the year were guiding around 150 $150 million and that's up from the level in 2021, which is close to about 130, or so and that represents a solid 15% year on year growth rate, so where can we.
Pleased with what we see in the U S from a gross growth and the churn that we're seeing as temporary will subside and then we think growth will return into that mid single digits in the U S over the long term.
And just to follow up briefly so for the national carriers that you would have msas with ease mid band five G covered under those MLA or might that be something that has to get figured out in the future.
No I think when you think about the MLA that we have it's based on use rights into use rights fees. It's all incorporated so to the extent that their activity level fits within the use rate bucket then it's covered.
To the extent that they their activity level goes beyond what was contemplated in what was granted to them and the use right then that would be upside and certainly anyone that's on an a la carte basis. It's a pay as you go and there's certainly upside there depending on.
How quickly they deploy how aggressively they deploy and we do see in the U S things are continuing to heat up.
Expect thing North of 30 billion once again in terms of carrier Capex and that bodes very well for R. R.
Short term as well as long term.
Tenant leases ear, so we and we're excited about <unk> in the U S and in all the mid all the C band spectrum, that's been auctioned off and that is out there that will eventually be deployed and we're seeing lots of activity as well.
Thanks.
Thanks, Mike.
And our next question is from Ric Prentiss with Raymond James. Please go ahead.
Hey, good morning, everyone.
Hey, Rick Good morning, Rick.
Did you guys are doing well hope you continue to stay well.
Couple of questions first I appreciate the color on what your assumption is as far as the.
The equity component about half of the 10 billion in total about 5 billion equity raise common as an assumption how should we think about the gating factors of what was what are you waiting for to go to market. Obviously, there is some overhang on the stock as we wait for the offering how should we think about what are the gating factors on go to market and update us a little bit on what might be going on.
With private capital.
But.
Sure. So the gating item is really sorting through the.
The different options that we have ahead of us there may be an element of of common equity that we deploy here and for modeling purposes for outlook purposes, we are assuming that it's half of the $10 billion.
Certainly when you think about that equity offering we did go through a tender offer that tender offer resulted in us closing right at the end of the year and then we deal with we opened windows closed windows when as a company we can go out to market.
And that kind of pushed us into.
January which was beyond Q4 and then.
Looking at the way Q4 rolled out we Couldnt go out with equity at that point. So theres a lot of complicating factors kind of in there, but certainly we have windows that open up here shortly and then again in Q2, but with that said we're focused on the long term value creation from core site, which is a high quality.
Very interconnected network and cloud centric set of assets that we think over the long term is going to drive a lot of value. So we want to make sure that we put the right financing together and if that takes a little bit more time to get the right.
<unk> put together then that's what we'll do and with that said that the common equity that we have in the assumption isn't assumption. We're also looking at private capital partnerships. We're also looking at mandatory convertible preferred instruments and will make the best decisions based on market conditions terms and conditions of any potential private capital and.
And we'll make those decisions again as I said in the prepared remarks.
Always with the best interest of the shareholders in mind and minimizing dilution is always important to us. So we take that very seriously and then also making sure whatever we do stay solidly within the framework of investment grade credit. That's another thing that's very important to us.
A lot of the calculus wanted to follow up on one of the Simons questions also.
Tom You mentioned there was a lot of portfolio as discussed out there what about other asset classes.
Fiber data centers, besides towers in Europe , or other vendors how interested are you in fibers or data centers outside the U S and we get the question a lot with.
And of course, I do you need to spend a lot on.
And kind of replicating in Europe .
The data center concept of what you've gotten with foresight.
Yes, no. Thanks, Thanks, Rick I mean.
Outside of the United States. Our focuses are clearly your tower portfolio.
We do have.
Some <unk>.
Initiatives going on with regards to fiber down in Latin America.
We actually do have some smaller data centers can lead down in down in Latin America as well on a very small scale.
The reason for clearly the core site acquisition was really in the United States, That's where we think that that edge grid.
It's really going to be developed first and we'll look at that as clearly the market to develop that strategy.
And then evaluate options to be able to expand that to the extent that it makes sense outside of the United States. So.
The platforms that we're really seeking outside.
Are largely driven by the tower, we have a lot of power and fuel.
Initiatives going on particularly.
Particularly in Africa, as well as in India. So.
So we consider that a platform.
Extension, if you will Rick where we're really trying to reduce the overall carbon footprint improve that.
Holiday of up sight reduce our overall diesel consumption similar to you know really consistent with what we're trying to do with our science based targets, but but offering even more value to our customers who are more efficient power and fuel.
Initiatives.
We will really develop the kind of that data center model, the interconnected model with our tower portfolio within the United States and so outside of the United States. It clearly is a tower focus.
Great that helps I appreciate it guys stay well.
Thanks, Rick.
And our next question is from David Barden with Bank of America. Please go ahead.
Hey, guys. Thanks for taking my questions.
Maybe just.
If I could do a couple of quick ones.
I guess first Tom could you maybe talk us through at the end of the day, who the who the new leadership team is for the core side asset.
And then rod.
Just to follow up on Rick's question.
Given the valuation you guys paid was very strategic in a kind of a very competitive process.
And the market has pulled back is it is it plausible to believe that there is private capital out there that that would want to.
Hey, what you paid for a stake in that business and then I guess my last follow up if I could rod was.
You mentioned that youre going to be getting.
Termination fees coming from Latin America could you kind of put some numbers around that for 2022.
Yeah, David I'll, just take the first one is a quick one Steve Andre who is the president of our U S.
Business is responsible for.
The core site.
Investment in the business, our one pot who was within the business is terrific leader is actually responsible for running the core set business working directly for Steve.
Right Yeah yeah.
And David I'll I'll tack over the next two so on the private capital side.
Yeah, I think it's absolutely plausible to think that there are investors out there that.
Let's see the long term value and value creation within the core side assets. We do believe that the core site set of assets is is amongst.
The highest quality portfolio.
Of highly interconnected cloud centric network centric.
Data center type assets.
In the U S and they are strategically placed across the country from West coast.
Central over to the East coast as well so the locations are perfect in terms of being able to tie into lots of our towers across the.
Across the globe so.
As we look at this and we look through kind of short term volatility in the equity markets as well as even with interest rates and things like that.
I I think it is very plausible and we're very encouraged by the fact that that there are a number of investors out there that see the long term value and value creation here I believe in the.
The transition of some of these data center assets into more distributed cloud on ramps more distributed compute power and tie that up with tower companies and the traditional tower company customers.
That's a long way of saying, yes, absolutely I think people would be would be interested in that but with that said our options are all kind of opening on the board and we'll be evaluating that over over the coming period of time.
And then in terms of the termination fees. It's in the range of $40 million that youll see and I kind of come through the kind of come through the numbers in 2022 really kind of flat with what we experienced in 2021 as well as in terms of termination fees.
Alright awesome. Thanks, guys appreciate it.
Thanks, David.
And our next question is from Matt nickname from Deutsche Bank. Please go ahead.
Hey, guys. Thanks for taking the questions.
Just two if I could first just to go back to data centers.
We're about two months in post deal close I'm just wondering if you can share maybe the initial playbook for those assets and of course I had assets.
And more specifically plans on potentially expanding the footprint beyond either the existing markets domestically or internationally and then secondly, just a pivot to India because that's the one region that I believe has not come up yet in the Q&A.
Can you just talk about what's driving the improvement in the outlook there in <unk>.
<unk> thousand 22, and then maybe more broadly could give us any update you're seeing in terms of the overall demand backdrop, there from the carrier customers.
Hey, Matt Let me take the first one and I can take the second one on on on India, Yes, we are.
We're about two months into the transaction.
Of course, <unk> had a strong finish to 2021.
And we expect even a stronger set of growth metrics for.
2022 I mean, there were.
We're moving through the integration process as you would expect rod talked about the financing element of it.
And we have teams looking at all of the opportunities to create synergies between the tower business as well as the the data center business, but we're you know we're going to enjoy all the underlying growth.
Coming from the business itself.
Integrating the data center companies that we had albeit on a small scale clearly compared to core site in.
To the to the core side business. So there are a lot of activities going on from an integration perspective on the commercial side, they're a significant amount of.
Customer conversations discussions proof of concepts.
That are being developed and work through a number of different fronts.
With a number of different types of customers.
Cloud service providers, the Msos and so you know there there are.
Continued initiatives going on to look at the opportunities to bring you're able to bring our vision.
To the market and it's not going to happen overnight.
But in the meantime, we have the ability to really enjoy the underlying growth on the positioning.
The core side has.
They have some development that's going on within their own portfolio. This year in terms of building out some of the data centers that they've got.
But as I said their underlying growth trends are our greater than then they were in 2021. So we're really excited about the leadership team that we've got in place and the opportunities that we're going to see come to fruition over the next couple of years.
Okay.
And Matt in terms of your question around India I'll hit a couple of highlights here. So in India, I think you're probably aware that the backdrop of the telecom environment is improving quite a bit and has done so in the last several certainly the last several quarters. The government has really stepped up and shown support for the wireless segment in the Telecom segment and in addition, the carries on.
Salves or have increased the tariff so they're they've got healthier businesses as <unk>.
They go forward and specifically to voting you've seen probably just recently, even their intentions to monetize part of their stake in the <unk> portfolio to improve liquidity. They also chose to have some of the interest on there.
Their spectrum dues and Theyre AGR.
Fees going back too.
Transitioning that from a liability to the government and swapping it for some equity.
We improved kind of their balance sheet.
And now they have a much longer runway it really the whole sector has a much longer runway to kind of sort through the environment. There because of those things we are seeing churn subside in the in the marketplace and we've seen that over the last several years. So in India, specifically, we're guiding to 2% to 3% positive organic tenant billings growth.
That comes with 5% growth organic growth of 2% escalator with just contractual throughout all of our leases there in about four 5% churn that churn rate is down from over 10% in 2021. So that's why you see sort of the biggest improvement there.
The other thing I would say is we think the India marketplace is it's going to be very constructive here over the long term certainly there's a large population in networks are in the early stage of development they need a lot more infrastructure and the Indian subscribers really do consume lots of.
Lots of lots of data.
And so we think that the market is still trying to absorb some of these positive changes that they've seen and once that happens and in all of the carriers trying to get used to the new environment. There. We should see churn continued to decline over time as well as gross new business increase overtime and those are the things that kind of get us back to that.
Single digit growth rate potentially but as of now we're fairly cautious around India in terms of our outlook and projections.
And even in the long term guide that Tom talked about earlier that 10% <unk> per share growth, we have fairly modest improvement built in there for India, not getting back up to that small upper single digit growth rate. So there is upside from that perspective, India continues to improve.
Over the coming quarters and years.
Very helpful. Thank you both.
You're welcome.
And our next question is from Brandon <unk> with Keybanc. Please go ahead.
Awesome. Thank you for taking the question.
Guys gave the $150 million in Colo and amendment guidance per the U S business in 'twenty, two it's clearly up year over year, but still well below 2018 in 2019 I was hoping you could help us understand the primary differences between what was happening in 2018 in 2019 versus your 2022 guidance and maybe where we're going.
And then in relation to that $1 50 number specifically could you help us understand what percentage of that is fully contracted versus your expectations for billings coming in more olive garden. Thanks.
Sure Brandon So in terms of looking backwards to 2018, I don't want to go through too much detail between the two but certainly back in 2018, there was an explosion of activity in the U S. From all the carriers that was a time when we had all the carriers including sprint.
Investing heavily and contributing to our revenues.
And our handle and a pretty heavy way. So sprint was a big contributor back then.
It was at a time when AT&T was also aggressively.
Aggressively building out the first net network. So those two things we're kind of unique around 2018.
And those are those aren't repeating so we're very happy with where we are in terms of the co location Amendment contributions in 2022, we do see that accelerating into the back half of 2022, and we expect that acceleration to continue going out and again a lot of that growth even beyond 'twenty two is contracted in the whole.
Mystic MLA that we have so we have visibility to that growth. So we do think we're entering a multiyear cycle of.
On acceleration when it comes to that organic new beds, the collocation and amendment piece.
Piece of it.
And what was the other question that you had the one sei.
Yes.
Oh boy, it's add on yes.
To add on that one particular piece you know that when you think about kind of 17 18 19, it was kind of it did.
The latter end of kind of a heavy <unk> investments and you would typically see that with new technology is going in place and so I my sense is that that's what we would.
We start to see when we think about <unk>. We're just in the early stages. The carriers are starting to clear and rollout C band I mean, we're start we'll start to see it even in the end of this year when we when we start to get into a ramp up on the organic growth rates.
But as <unk> takes hold and continues to develop in and densify.
We would expect that similar type of.
A growth ramp up.
Clearly with the with five <unk> and yeah as Rod said sprint was very active back at that point in time, obviously not around any longer but with dish now in its place hopefully you know they would be able to be that.
Fourth agent there.
And and really driving that kind of growth.
And Brendan I think your other question was around the percentage of the 150 that was contracted it's in around three quarters.
Okay. Thank you.
And next we have a question from Jonathan Atkin with RBC. Please go ahead.
Thanks, very much so in the slide deck, you talked about Chelsea is driving a lot of growth in international I Wonder if you could.
Give us a little bit more color on contributions and which particular markets that are that came from.
And then maybe related to the very first question around M&A, but you you talked a lot about kind of five G in edge and I wondered how does that affect your perspective capex profile across what sorts of assets. You also have fiber, which hasn't come up a lot on this call and Latam for instance, so across assets and regions how does.
<unk> and edge kind of affect your incremental capex going forward as well as the fact is that the types of assets that you might get a little bit more seriously going forward compared to compared to in the past. Thanks sure sure know, Jonathan let me start and Rod G&A to anybody but from that from a European perspective, clearly much of the growth is key.
Coming in Germany.
Where they you know they've been very aggressive in terms of rolling out our five G.
As well as in Spain. So I mean, those are our two critical markets there, but Germany is really going to be I think really driving a lot of it and we're seeing a lot of activity in Spain as well from a capex perspective, maybe you can take a look at.
Even our projections for 2022, I mean, it's largely driven by our tower portfolio.
There are certain development activities within the data center assets in the United States.
Building out, but it pales in comparison to what we're expecting on the on the.
Tower Capex side, we're looking at a major.
Generate a rollout for a for a large customer in the United States, which is a piece of it and we're also looking to build another 6% to 7000 sites.
So if you look at over the last several years you know we built.
Cumulative about 20000 sites.
And we have significant expectations for continuing that kind of a trend in 'twenty. Two is there is no different and so it's <unk> and it's five G is developed around the world. We continue to see the need for a new build to suits.
And that is the best use of our of our capital.
With regards to fiber and some of the other assets outside of it.
Minimis I mean, it's very very small.
And in many cases, they're just science projects, where we're still trying to see if there's really an opportunity in those markets, but and I would see that trend candidly for the next several years.
The the direction for for capital is going to be driven to the tower base of assets again, largely driven to the development side at building out new sites.
And very little.
Spent on some of the fiber portfolios or fiber assets outside of the United States.
And then Jonathan.
Yep.
Im sorry, Jonathan I'll hit the <unk>.
On Europe .
Chelsea So as you saw from the prepared remarks and in the slides we are looking at about 9% organic tenant billings growth in Europe . So a real strong upper single digit number that compares to 2021, which was around.
5% a couple of the drivers that we are seeing solid organic new bids up around 6% or so for the so the market. The escalators are up a bit. So we're up at around four 5% escalators. The churn is down from two four in 2021 down to one four in 2022, a lot of that is directly driven by the <unk>.
Celsius assets, which are which are very low to no churn assets the way the contracts are written.
From a structural standpoint, so that reduction in churn that 100 basis points, you can really subscribe back to the Telsey isn't that gives you the 9% organic growth rate I would say, we're seeing our best growth year in.
In Germany, but even if you pull away the telsey of assets that are adding to the overall growth yeah, we're still seeing north of 6% or so.
Both in the legacy business kind of across Europe .
Are things that I would point out in terms of the 9%, we do expect that some moderate throughout the year and be lower in the back half of the year after we kind of lap.
No we havent Kelsey on for a full year. So we're looking at about 7% organic growth in the back half of 2021, and then beyond that we are looking at Europe , not being at 9%, but being kind of in that mid single digits upper single digits. So in Germany. We are still looking at 6% to 7% organic tenant billings growth in that market and across all.
All of Europe , we're looking at mid single digits, let's call it 5% to 6% organic growth in Europe , even beyond 2022.
Thank you for that color.
And then just in terms of potential private capital partnerships.
Any kind of a refresh but you can give us on just the criteria that you would.
Have from whether it's a governance standpoint, our strategic what they bring strategically set the table table or the financial criteria that you employ when you evaluate potential private capital partners.
Yes, Jonathan I'll keep it at a fairly high level here and I don't want to over over.
Emphasized the private capital or any of these different elements, because we're still working through the process.
And when we do land on our optimal finance plan here, we'll let you know but in terms of our criteria, we certainly look well beyond just capital.
As we did with tells you is we want to know that we've got world class large investors with us that have the same or similar mindset around the specific assets the region and the future of those assets.
Because additional capital and really having a partner that wants to grow in terms of this asset it's going to be around <unk>.
Exploiting this asset in terms of that that cloud distribution that heavy interconnection and then eventually moving to the edge of the Metro edge. So we certainly want someone at the table with us that that has a similar vision. There that is excited about that and again doesn't get too wrapped up into a short term equity volatility, but sees the long term.
And certainly the investors that we would talk to just like in the in the Chelsea as processes are long term investors. They're 15 to 30 year investors are not five years and so that's what we.
That's what we want and then we also really like investors that that are very experienced and investing we like having people at the table with us talking about ways to grow how to grow.
And we find a real value that so I would just maybe emphasize the fact that our partnership in Europe with CDP Q Ali on some P. G G M.
<unk> has been very good for us not just for the capital but for a lot of other reasons. So we couldnt be more pleased with the way that partnership has unfolded and if we were to do something in the U S. It would be we would be equally as optimistic around the good relationship the shared vision.
Those sorts of things and of course governance in terms and conditions are always important to us and value is something we take seriously. So we will certainly be working through that but that'll be a criteria that it'll be on the table.
Thank you.
Youre welcome.
And ladies and gentlemen, our final question will come from Bacci I believe diet with UBS. Please go ahead.
Great. Thank you.
Two quick follow ups can you provide the geographic mix of the 6500, new boats. This year and just the on the U S 150 million of New co Lo Amendment, what's the Colo versus amendment mix and how should we think about the pacing through the year. Thank you.
How about yourself.
I'll hit the first one.
Here for you. So we're looking at around 2020 to about 6500, new bills as in the past it's heavily concentrated in India.
India region, So north of 4000, roughly and these would be rough numbers in India. The next largest region is going to be in.
In Africa, which is going to be in the range of 1900, or so then we drop into Latin America, and Europe are pretty equal at around 500 sites.
Sites, each and I will just remind you that in <unk>.
In Europe , we are building a lot of towers they are through the healthiest transaction.
With a 10 year build to suit commitment.
3000 sites over that time period. So we are actively building those assets. We're also building assets for orange across Europe , which the way they show up in our numbers it kind of comes through as a.
You know more in terms of an acquisition because they build them and so it kind of flipped to us, but it really is sort of a build to suit program as well. So we couldnt be more pleased with the way that our the way that our build to suit program is working and unfolding, we continue to see double digit NOI yields.
Kind of across the mix here.
All of these regions, which is really good. So we are solidly kind of on track to hit that 40 to 50000, new builds that Tom had talked about in the past and then in terms of your other question when it comes to the split between amendments and Colo.
Not a lot of detail then I will get into from that perspective, a lot of our revenue was under the MLA agreements, which again is more use rights and fixed fees and not so much ascribed.
Ascribes, a colo versus an amendment.
We're still seeing heavy amendments in the industry by and large certainly there's one carrier that might be a little bit more weighted towards towards co locations, but we're still seeing in terms of the activity level heavily weighted towards closing.
Towards amendments, but I wouldn't want to try to split the 150, because that's not the way that our contracts work in terms of the revenue.
Got it thank you.
Welcome.
And speakers I'll turn the conference back to you for any closing comments.
Okay.
Yeah.
Hey, Thank you very much everyone for joining us this morning, I know theres a lot of news.
Around the world.
Hope you all stay safe and well and then again just I. Appreciate you all being here. This morning to the extent you have any further follow ups. Please give us a call where we are clearly by the phones waiting waiting to talk so thank you all.
Thanks, everyone.
Ladies and gentlemen that does conclude your conference for today. Thank you for your participation you may now disconnect.
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