American Tower Corp AMT
Q4 2012 Earnings Call Transcript

Transcript Call Date 02/26/2013

Operator: Good morning. My name is Angel, and I will be your conference operator today. At this time, I would like to welcome everyone to the American Tower's and Fourth Quarter Full Year Earning Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you.

I would now like to turn the call over to our host, Ms. Leah Stearns, Vice President of Investor Relations and Capital Markets. Ma'am, you may begin your conference.

Leah C. Stearns - Director, IR: Thank you, Angel. Good morning, and thank you for joining American Tower's fourth quarter and full year 2012 earnings conference call. We have posted a presentation, which we will refer to throughout our prepared remarks under the Investors tab on our website,

Our agenda for this morning's call will be as follows. First, Jim Taiclet, our Chairman, President and CEO, will provide opening remarks. Then Tom Bartlett, our Executive Vice President, CFO and Treasurer, will review our financial and operational performance for the fourth quarter and full year 2012 as well as our outlook for 2013. Finally, after these comments, we will open up the call for your questions.

Before I begin, I would like to remind you that this call will contain forward-looking statements that involve a number of risks and uncertainties. Examples of these statements include those regarding our 2013 outlook and future operating performance, including AFFO growth and dividend per share growth, our capital allocation strategy, including our stock repurchase program and REIT distribution 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 the risk factors set forth in this morning's press release, those set forth in our Form 10-Q for the quarter ended September 30, 2012, and in our other filings 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 would like to turn the call over to Jim.

James D. Taiclet, Jr. - Chairman, President and CEO: Thanks Leah, and good morning, everybody. American Tower's growth strategy is based on a simple observable premise. The consumers' appetites for mobile communications and entertainment are growing dramatically in the U.S. and around the world. The most recent industry results and forecasts confirm that we are squarely in the midst of the decade of wireless in the U.S. based on tremendous demand for mobile data and entertainment services.

In just the first two years of the decade smartphone penetration increased from about 20% to nearly 60% and mobile data traffic grew by five times in just those two years.

Moreover, as shown on Slide 5, the most recent Cisco forecast that was just released projects that mobile network traffic will grow another 10 times over the next five years. The Cisco study also estimates that approximately 75% of this growth will be delivered over traditional macro sites, primarily towers. The remaining 25% of the expected growth would be on supplemental solutions, such as DAS, picocells and Wi-Fi, with even some of these small cell installations being used on or in connection with macro sites on towers and we're starting to see some of that that now.

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