ATC is expecting the impacts of Indian carrier consolidation-driven churn to last for some years and expects the churn rates to decrease once the consolidation process is complete. The impact is expected to be $180 million on property revenue, $90 million on consolidated AFFO and $115 million on adjusted EBITDA, inclusive of the an expected reduction in pass-through revenue of $60 million.
The consolidation in the Indian telecom industry started just after the entry of Reliance Jio. In the recent consolidation, Vodafone and Idea cellular are also merging to become India’s largest telecom operator.
ATC is reducing the midpoint of its 2018 outlook for property revenue by $60 million, net income by $80 million and adjusted EBITDA by $30 million. In Q2 2018, ATC has posted property revenue of $1.749 million, revenue of $1.781 billion, adjusted EBITDA of $1,084 million and net income of $314 million.
ATC said, “the adoption of unlimited data plans in the U.S. wireless market has elevated mobile data usage growth to roughly 40 percent. This is fueling record levels of US commenced new business for American Tower, resulting in Organic Tenant Billings Growth of 7.4 percent in the second quarter”.
“We also anticipate a multiyear period of elevated demand in the U.S. as our tenants invest in 4G capacity and quality while launching mobile 5G networks, enhanced Internet of Things services and other initiatives,” American Tower’s CEO Jim Taiclet said.
ATC has recently added approx 20,000 Vodafone and Idea Cellular sites and spent $663 million to acquire over 10,000 telecom sites, including over 9,700 sites in India through its transaction with Idea Cellular.
