SBA Communications Corp (SBAC) — Q4 2024 Earnings Call Transcript

Good evening, and thank you for joining us for SBA's fourth quarter 2024 earnings conference call. Here with me today are Brendan Cavanagh, our President and Chief Executive Officer, and Marc Montagner, our Chief Financial Officer. Some of the information we will discuss in this call is forward looking, including but not limited to, any guidance for 2025 and beyond. In today's press release and in our SEC filings, we detail material risks that may cause our future results to differ from our expectations. Our statements are as of today, February 24, and we have no obligation to update any forward-looking statements we may make. In addition, our comments will include non-GAAP financial measures and other key operating metrics. The reconciliation of and other information regarding these items can be found under supplemental financial data package, which is located on the landing page of our Investor Relations website. As part of an ongoing effort to improve our earnings materials, we have made certain modifications to the supplemental financial data package and will be providing the materials in both PDF and Excel form. Note, the revised package does not exclude any previously provided financial or operating metrics. With that, I will now turn the call over to Brendan.

Thank you, Mark, and good afternoon. The fourth quarter was a solid finish to the year. Results for the quarter were in line to slightly ahead of our estimates, even with worse-than-assumed foreign exchange rates. Domestic new carrier activity or bookings continued to increase sequentially from the third quarter. The shift in the makeup of our new business also continued, with a higher percentage coming from new lease colocations versus amendments to existing leases. Our carrier customers continue to expand their 5G mid-band coverage, including adding capacity for fixed wireless access, as well as extending network coverage into areas of the country that have little to no cell coverage today. Even with increased bookings in the quarter, our leasing application backlogs grew throughout the quarter and finished at the highest level of the year, and our US-based services business had its best quarter of the year as well. The beginning of 2025 is also off to a strong start, suggesting another quarter-over-quarter increase in new leasing business to begin this year. Our 2025 services outlook contemplates a year-over-year increase in that business. Our US customers are busy and we expect to be a key partner to them this year in support of their network goals. Internationally, our fourth quarter results were in line with expectations as our customers continue to invest in their networks. In almost all of our international markets, the mobile network operators are well behind the US in terms of 5G coverage. We anticipate continued network investment to close that gap and to broadly expand coverage to underserved areas. In many ways, wireless is an even more critical service in our international markets than in the US. International churn, unfortunately, continues to be elevated, largely due to customer consolidations, and we are working closely with our customers to help them achieve necessary network efficiencies. We believe the surviving customers will be stronger and better positioned for ongoing investments and ultimately will support greater stabilization in our international cash flows. Overall, 2024 was a successful year. While our stock performance was hindered by the headwinds of the macro interest rate environment and a strong dollar, we had several accomplishments that set us up well for the future. Operationally, we expanded and strengthened our relationships with our largest customers. We grew our leasing and services backlogs, refreshed our mission, vision, and values, and streamlined a number of our operations and processes. With regard to capital allocation, we invested over $550 million in asset acquisitions, stock repurchases, and new tower builds, all while growing our dividend at an industry-leading 15%. We also improved our balance sheet and liquidity position. In the beginning of the year, we refinanced our $2.3 billion term loan, pushing out the maturity to 2031, extended the maturity of our revolving credit facility and increased it from $1.5 billion to $2 billion and subsequently entered into a forward-starting interest rate hedge, reducing our future floating rate interest exposure and locking in a much lower rate than can be achieved today. In addition, in October, we refinanced $2.1 billion of tower securities at rates well below where those same securities would price today. We ended the year at 6.1 times net debt to adjusted EBITDA, the lowest level in our history. In February of last year, I laid out my strategic priorities, focusing mostly on ways to enhance the portfolio with the goals to stabilize results, grow the core business, and improve the overall quality of our assets, be it through inorganic growth or new agreements with our customers. While we still have work to do, we made major strides toward these goals. As announced last quarter, we entered into an agreement to purchase approximately 7,000 towers from Millicom in Central America. This immediately accretive transaction positions SBA as the leading tower operator in the region with over 10,500 pro forma sites. Beyond just the absolute size and scale, this deal aligns us with one of the leading MNOs in the market under long-term US dollar denominated lease agreements. We also entered into a significant build-to-suit agreement with Millicom that we expect will drive growth and further improve our position in the region for years to come. In fact, our 2025 outlook incorporates a planned level of up to 800 new tower builds this year, the largest number for SBA in over 20 years, with the majority of those in Central America. Needless to say, we're excited about this transaction and its contributions to our future growth and stability. Alternatively, when we are in a subscale position and don't see a path to scale or other potential limitations on a market's future performance, we'll look to exit those markets. Like we did in Argentina back in the fourth quarter of 2023, we officially exited the Philippines in January. And today, we've also announced we are under agreement to sell our operations in Colombia. The Colombia market represents less than 200 sites and the impact on the financials is immaterial. It is not our desire to exit markets. In fact, it is much more our preference to find ways to scale by aligning with leading carriers and driving returns. We will continue to look for ways to do just that across our remaining markets. Each of the steps taken over the past year will help our teams be better focused and better positioned to maximize new business opportunities. Looking at 2025 and beyond, the key growth drivers remain intact. Mobile network consumption continues to grow and limited new spectrum availability means more equipment at the cell site. Fixed wireless access, the incorporation of next-gen AI applications and handsets, regulatory buildout requirements, and remaining 5G coverage expansion are expected to contribute to ongoing network investments. The strength of our balance sheet and the significant free cash flow that we generate every year will allow us to continue investing in high-quality new assets, as well as shareholder remuneration through industry-leading dividend growth and share repurchases. We are optimistic about our future opportunities. Before turning it over to Marc, I'd like to thank our team members. The company's ability to achieve our vision to be our customers' first-choice provider and the industry leader in quality infrastructure solutions is only possible because of the incredibly hardworking team members we have here at SBA. I'd also like to thank our customers for their trust in us, and we look forward to collaborating with them to achieve their network goals. And with that, I'll now turn things over to Marc, who will provide additional details.

Thank you, Brendan. Fourth quarter domestic organic revenue growth over the fourth quarter of last year was 5.1% on a gross basis and 2.2% on a net basis, including 2.9% of churn. In the quarter, we added approximately $8.5 million in new leases and amendments billings. With respect to the 2.9% of churn, 1.6% was related to Sprint consolidation or approximately $7 million. Year-over-year, international organic recurring cash leasing revenue growth for the fourth quarter, which is calculated on a constant currency basis, was 1.7% net, including 6% of churn or 7.7% on a gross basis. In Brazil, our largest international market, gross organic growth was 8.7% on a constant currency basis. Core international churn remained elevated in the fourth quarter, mostly due to previously announced carrier consolidations. During the fourth quarter, consolidated cash site leasing revenue and adjusted EBITDA denominated in US dollars was 78% and 81%, respectively. The majority of non-US denominated revenues came from Brazil, with Brazil representing 15.6% of consolidated cash site leasing revenues during the quarter. This earnings press release includes our initial 2025 outlook. Domestically, outlook reflects both the lower level of carrier bookings we experienced in 2024 and our expectation for increased activities throughout 2025. We're guiding to a range of $35 million to $39 million from new leases and amendments. The outlook also assumes a range of $50 million to $52 million related to Sprint churn and $20 million to $22 million in regular churn. Our previously provided estimate of aggregate Sprint-related churn over the next several years remains largely unchanged, with an estimate of approximately $50 million in 2026 and approximately $20 million thereafter. For the international segment, our outlook reflects steady network investment, guiding to a range of $16 million to $18 million for new leases and amendments. The outlook also assumes a range of $27 million to $31 million related to churn. Churn continues to be elevated as we work through carrier consolidations, some carrier bankruptcies or restructurings, and wireless operators' network rationalizations. We are working with our current customers to minimize churn over the long term. Additionally, foreign exchange remains a headwind, and we're guiding to a negative $25 million year-over-year impact from foreign exchange on site leasing revenue. Turning to services, we're guiding to a range of $160 million to $180 million in revenue, reflecting the increased carrier activity we are seeing at our sites today. We saw a meaningful increase in activity in the second half of 2024 and we expect to see similar levels throughout 2025. The outlook assumes an anticipated closing date of September 1 for the previously announced Millicom transaction, which is expected to contribute approximately $42 million to cash site leasing revenue and $29 million of total cash flow to our 2025 outlook. The ultimate closing date is dependent upon regulatory approval and other requirements and may differ from this date. Please also note that the outlook does not assume any further acquisition beyond those which, as of today, are under contract and expected to close by year-end. We also do not assume any share repurchase in the outlook. However, it is possible we may invest in additional assets or share repurchases or both during the year. I will now turn the call over to Mark, who will provide additional details.

Thanks, Marc. As we previously announced on our third quarter call in October of last year, the company issued through an existing trust two tranches of Tower Revenue Securities for a total of $2.07 billion, which included a tranche of $620 million issued at 4.654% with an anticipated repayment date of October 2027 and a final maturity date of October 2054. We also issued a tranche of $1.45 billion issued at 4.831% with an anticipated repayment date of October 2029 and a final maturity date of October 2054. Our next maturity is a $750 million ABS note due January 2026. Our current leverage is 6.1 times net debt to adjusted EBITDA, and the fourth quarter net cash interest coverage ratio of adjusted EBITDA to net cash interest expense was very strong at 5.5 times. Our weighted average maturity is approximately 3.4 years with an average interest rate of 3.2% across our total outstanding debt. As of today, our $2 billion revolver remains fully undrawn. During the fourth quarter, we declared and paid a cash dividend of $105.4 million or $0.98 per share. Today, we announced that our Board of Directors declared a first quarter dividend of $1.11 per share payable on March 27, 2025, to shareholders of record as of the close of business on March 13, 2025. This dividend represents an increase of approximately 13% over the dividend paid in the fourth quarter of 2024 and approximately 35% of the midpoint of our full-year AFFO outlook. And with that, operator, we are ready to turn the call over to questions.

Great. Thank you. Can you provide a little bit more color on the increase in the backlog that you're seeing right now? Do you see that coming from increased applications from a specific tenant or is it more broad across all your tenants? And maybe some color in terms of how should we think about the book to bill cycle to be with colocation increasing? I know you just guided for '25, but if we assume it's a back-end loaded year, is it fair to assume you have good visibility for US leasing to be up next year? Thank you.

The backlog is quite diverse and varies among carriers. Some are experiencing more activity than others, but overall, there has been an increase in incoming applications. As we indicated earlier, we're seeing a rise in new leases compared to amendments to existing leases, which has been a shift from what we've observed in the past. This change in the types of new bookings will lead to a later book-to-bill cycle, and we anticipate growth quarter-over-quarter this year from new leases and amendments domestically. While I believe this bodes well for next year, it's a bit early to predict next year's numbers. We should wait to see how this year unfolds, but we expect growth to increase as the year progresses.

Sounds good. Thank you.

Good afternoon. Thanks for taking my question. With many of your carrier customers in the US having sort of given a multiyear outlook for CapEx, which is sort of consistent with what the past couple of years, how should we think about your ability to sort of grow domestic leasing in the outyears relative to this year's guidance, if those budgets remain where they are? And maybe what are some of the areas that would allow you to sort of outperform those overall CapEx growth envelopes, whether it's densification, fixed wireless or otherwise?

Yeah, Jim. I mean, the carriers obviously have very large CapEx budgets. And so, what would probably be relatively minor shifts in the mix or makeup of those CapEx budgets can have a more meaningful impact on us. And so, I'm not too concerned about their overall CapEx budgets being relatively flat because what we're seeing on the ground is a lot more activity around their wireless networks and specifically the macro-based networks. So, as I look out into the future, I can only see what's happening now and what they're telling us today, and that suggests a lot more activity. And I think, actually, the lack of incremental spectrum being added to the mix means that they have to make sure that what they have stretches farther. And I think that's actually going to turn out to be decent for us in terms of their planning in the next couple of years.

Thanks. And then, Brendan, just to follow-up on that, I believe in your opening script, you mentioned that there you saw demand specifically for fixed wireless capacity additions. Can you maybe clarify whether that is fixed wireless capacity above and beyond or completely separate from conventional mobile capacity, or maybe any color on where that is happening would be helpful. Thank you.

Yeah. I mean, honestly, it's a little bit hard to distinguish from what we see going on to the sites in terms of basic 5G mobile capacity versus fixed wireless access, but what we're hearing is in our conversations with the carriers on the ground that that is a meaningful driver of the incremental investment in some of these locations. So, what I'm giving you, I guess, I would characterize as anecdotal, but we're definitely seeing the increased activity. And so, we mentioned that because it is one of the drivers that we hear from our customers as to the increased investment that they're making, but I think it's probably an all-of-the-above type of thing ultimately.

Great. Thank you.

Hey, thanks so much for taking the question. Two if I could. First, on the leasing outlook for '25, maybe Brendan, if there's any commentary you can offer in terms of what's baked in for customer-specific activity across the three nationals in DISH? And then, just secondly, on the services outlook, so the guidance for $160 million to $180 million, it's a little bit shy of the annualized exit rate from 4Q. If you just annualize the fourth quarter number, it implies closer to $190 million. And so, I'm just wondering if there were any one-timers in the fourth quarter, or if you're assuming any sort of moderation from any customers next year? Thanks.

Sure. Yeah. So, on the second one first, there's no one-timers in the fourth quarter. I think what we're giving you is based on what we have in our backlog today and the conversations we're having with the carriers. The services guidance is a little bit harder to be completely precise on when you look out for the full year at this stage of the year because it's not a long-term contractual cycle the way it is in the leasing business. So, as you get to the second half of the year, we tend to take perhaps a slight bit of conservatism in our approach to the back half of the year. So, I don't think there's anything really that you should read into that, Matt, in terms of against the fourth quarter of last year. On the leasing outlook, yeah, I mean, we prefer to stay away from too much detail on a customer-specific basis. As I mentioned in the answer to a previous question, we're seeing each of the big three carriers increase their activity levels, and so, they're all contributing to that. We do have contributions from certain carriers that have regulatory obligations for coverage and download speeds that are driving a big percentage of the activity that we're seeing. So, in one particular case, that's a main driver, but really they're all busier. So, I would say among the big three, that's the case. And as it relates to DISH, we're not seeing nearly as much as we have in the past. So that's a much lesser contribution.

Thank you.

Hi. Just wanted to follow-up on the mix of business. I assume still kind of heavier amendment versus colo, but by the end of the year, do you see that being more even or actually even more colo?

We're seeing a greater contribution from colos in terms of dollars in the US compared to amendments. Historically, amendments have dominated, but there's been a shift on a dollar basis. While the number of agreements still favors amendments due to their lower dollar values, colos are contributing more financially now.

And then, you have Sprint churn this year and some next year. Is there any kind of positioning in terms of maybe wanting to get that all into this year at some point, or is it still just kind of waiting for it to roll off?

Yeah, Richard. I mean, at this stage, most of this year's Sprint churn is stuff that's frankly already happened or just about to happen in some cases. And the financial impact of it is what's in our numbers for this year. And when you look at next year, which is the last big year, most of the impact of that will be driven by leases that expire right towards the end of this year or the beginning of next year. And so, there's really not that much time to try and pull something in. And in order to do that, you would expect, I think, that T-Mobile would expect some sort of balance in that, but there's something in that for them if they're going to pay it off early. So the quick answer is I don't think that's likely to occur, in terms of accelerating it. But at this stage, we're down to the final years of the material impact. So I think everybody knows what it is at this stage.

Great. Thank you.

Sure.

Thanks, and good afternoon. Two questions. First one, if I could follow-up on the last one, as the merger churn is picking up in the US, is there a corresponding increase in fees for carriers leaving the equipment behind? And is that something that could be a significant contributor, whether it's this year or over the next few years as you kind of wrap up some of this merger churn? And then, secondly, just maybe taking a step back on capital allocation, if you can give us an update on how you're thinking about your target debt leverage and the priorities for capital? Thanks.

Sure. Regarding Sprint, there are fees related to decommissioning and pay-and-walk situations, but most of those fees have already been incurred. Even though the churn is spread out over time, many installations have already been decommissioned. If you examine our domestic revenue bridge, you’ll notice that the other bucket is slightly down, which is partly due to the reduced contributions from these fees compared to previous years. There will continue to be more decommissioning as there are still sites where equipment is being removed, and we typically handle that work. However, I don’t anticipate it having a significant impact on our reported results. As for our target debt level, we have historically aimed for a specific range and have been under that range for some time. Currently, I don't foresee a change from our leverage level of between 6 and 6.5 times net debt to EBITDA. This stance isn't based on a desire to maintain that level but rather reflects our capital investment opportunities. If substantial investment opportunities arise that require additional leverage, we would be willing to pursue that. Nevertheless, given that we can comfortably manage the Millicom deal closing later this year, it seems reasonable to expect our leverage to remain below 6.5 times by year-end, as indicated in our current guidance.

Thanks.

Thanks, everybody. How are you doing?

Hey. Good, Ric. How are you?

I would like to further explore Michael's question. What do you believe the leverage should be to maintain an investment-grade status? Since you don’t have many final purchase options, do you think it could be in the range of 6% to 6.5% or 6 times to 6.5 times?

Yeah. Well, based on where the agencies have indicated, and it's actually out there publicly, as the break points, I do believe that we could be investment-grade certainly with at least one of the agencies and I think with both, at the level that we're at today. It's really more of a commitment as to our intention to stay there or to go lower. And we're frankly not yet ready to make that commitment, but at some point, that will be the natural course for things, and it'll happen. I just think it's a little premature to do that today. And frankly, I'm not sure that we get much benefit from doing it right now, particularly on a cost of debt basis; it would be very small to give up the flexibility that I think is more valuable right now.

Right. Of course, sometimes they let you flex up as long as you commit to bring it back down.

Sure.

The Millicom transaction, remind us how much turns of leverage that should be putting on as we look at closing the deal in September and what it means kind of leverage next year?

Yeah. I mean, by itself, it puts on about 0.2 turns of leverage, so very small. And obviously, depending on what we're doing in other places, that may or may not even show up as we get to the end of the year. So, when you're producing $1.3 billion or $1.4 billion of AFFO, we can absorb actually a lot and not really move our leverage.

One more kind of strategic question and then one kind of outyear question. But when you think about AI, you touched on in your opening remarks, when and how will AI affect towers? We've seen it obviously affecting data centers, but will AI benefit towers and how so and when?

It's difficult to provide a definitive answer. We do believe there will be a positive impact from the integration of generative AI functionalities into handsets. This integration is expected to drive increased usage and network capacity, similar to past innovations that have led to greater network utilization. This is beneficial for us. We are also implementing AI solutions within our business to enhance efficiency and provide better information to our customers, which could lead to increases in leasing. However, it's a bit early to predict any explicit impacts.

Makes sense. Appreciate it. Thanks, guys.

Yeah, sure.

Good evening.

Hi, Simon.

To Millicom, you talked about a September 1 close. Can you just update us on where the deal timelines are? What's the sort of sensitivity to that going to be? Do you have good line of sight to that? Could it be earlier? Could it be later? Might it close in stages? And then, Marc, you talked about the Sprint churn. Could you just give us a little bit of update on the international churn '26 and beyond what you're seeing remaining from Oi and some of the other consolidation? Thanks.

Yeah. So, on the Millicom closing date, we gave you what we consider our best guess at September 1. There are a lot of different factors that are potentially going to contribute to the timing of that. It definitely could be a different time than that. I mean, honestly, it's our desire and frankly, it's Millicom's desire to close earlier or at least close parts of it earlier. And if we can do that, we will do that because it's additive and we'd both like to get going here, but there are certain regulatory hurdles that need to be cleared and other diligence items and certain other things that need to get addressed. So, we pegged it at September 1 for purposes of issuing the outlook. And obviously, if it closes earlier or parts of it close earlier, we'll update our outlook as we move through the year if that happens. I don't expect that it would necessarily close later. It's certainly possible, but I think that's unlikely. And then, the international churn, there's a mix of things going on there. I mean, unfortunately, most of the churn that's in our outlook internationally is in Brazil. And, I would say, unfortunately, it's a little bit higher than we probably would have thought before, largely built around the Oi consolidation. But it's not necessarily just the direct consolidation. It's also all the steps that the carriers are taking, going through that process, the surviving carriers are taking to rationalize their networks and deal with other focus areas. And so, they're, as you would imagine, trying to be as efficient as they can. And we're trying to help them through that in a way that is balanced for us too, but it is pulling forward, I would say, some churn that we probably thought would have been spread out over a little bit longer period of time. And then, beyond that, it's a lot of different cats and dogs in different markets. The next biggest thing outside of Brazil honestly is a few million dollars of churn in Panama associated with the Claro-Liberty consolidation. So, we have those things that are still going on. But as I think that runs down, we'll see that improve. And actually, it'll be good for these markets as it will stabilize the markets.

Okay. Thank you.

Hey, good evening, guys. With respect to services, you've got one customer that's historically been much larger than the others. I guess, are you seeing any diversification of services work in '25 versus '24, or would you say it's broadly similar?

We're observing increases overall, but one major customer is particularly boosting their volume. Therefore, I don't expect the customer mix to change significantly. Our business remains fairly concentrated due to existing agreements with various carriers and turfing vendors. We continue collaborating with them because I believe they recognize that we perform exceptionally well in our work. As a result, there's a growing preference for using our services, especially on our own sites, which offers carriers several advantages. However, it's crucial that this work remains profitable for us too, making it slightly more complex. One of our internal goals, as you highlighted, is to diversify our revenue streams in this sector, which I believe is essential and achievable.

Okay. That's good to hear. Second, unrelated topic, Brendan, you had mentioned a step-up in the rate of new builds in '25. Can you share anything about the kind of initial development yields that you're expecting with those builds? And should we think of the change in the cadence as basically being attributable to Millicom as opposed to other factors?

The Millicom deal is a major factor driving our plans. It's by far the most significant contributor. As I mentioned, we anticipate around 800 new builds this year, which is reflected in our outlook and discretionary CapEx. About 500 of those will be in Central America as part of the Millicom deal, making it the largest driver. However, we are also building in other markets, such as Tanzania, where we are constructing numerous sites. Our efforts are concentrated in specific markets, but these projects are promising. We expect strong initial yields without requiring extensive lease-up, although there's plenty of room for lease-up opportunities in several cases. This should positively impact our return on invested capital as we progress with these projects.

Okay, great. Thanks.

Sure.

Hey, guys. Thanks so much for taking the questions. So, Brendan, Brendan Carr has been a vocal proponent of kind of changing the BEAD program to incorporate a little bit more flexible technological approaches to achieving some of these broadband goals, and fixed wireless access has been one of them. This has been a question we've been dealing with on the other side of the equation, which is how does it affect the wireline providers. I'm interested to hear your perspective on the extent that anyone has been phoning in asking SBA, could you help me figure out a way to address fixed wireless access as a BEAD solution? That'd be one question. And then, the second question is, another big question that's kind of arisen, subsequent to DISH kind of refinancing itself and getting $5 billion in capital, the question was, what were they going to do with that money? Were they going to use it to invest in handsets and marketing? Were they going to try to get to their build-out requirements? And, obviously, that build-out requirement extension that they just got from the Rosenworcel FCC is under threat. And I'm interested to know if there's some change in the conversation around how DISH might factor into your thinking in tower demand for the next couple of years? Thank you.

There's a lot to unpack here, David. Regarding the BEAD program, the short answer is no. We haven't really heard much from anyone seeking our assistance with fixed wireless access as a BEAD solution. In my view, and I believe others would concur, it’s primarily a fiber-focused initiative. Expanding it to include wireless solutions would be beneficial, and we fully support that idea. I believe it could be positive if it moves in that direction, but it feels a bit premature to assess its impact, especially since much of the funding is already distributed and plans are established. I’m uncertain how significant this will be for us, but I remain cautiously optimistic that it could be a favorable outcome. As for DISH, I mentioned earlier that we don’t anticipate much contribution from them this year. This is primarily because they have been relatively quiet. It seems they have a considerable amount to address, and our discussions with our network team suggest they have several plans in process. The additional time they were granted for their build-outs may have led them to feel they can take a more measured approach and focus on stabilizing their financial position. If that’s indeed the case, we’ll have to see how it unfolds. At this point, progress on their end is slow, but we are hopeful it picks up. We maintain a strong relationship with them, with numerous existing embedded leases, and we believe there is significant potential for collaboration once they clarify their plans in the coming years.

All right. Thanks, Brendan.

Sure.

Thank you. Maybe just going back to the international churn, curious to see the level you're expecting in 2025. Do you think that that's going to be the peak? And do we need to kind of move past the churn you're seeing to kind of see leasing start to accelerate in international markets or can they kind of be separate from one another?

Yeah. I mean, unfortunately, Ari, I don't actually think that it's the peak. I don't think it's necessarily going to be higher, but I do think that next year is likely going to be at a similar level to this year in terms of international churn. But its impact in terms of organic growth overall obviously weighs on it, but there are different markets with different dynamics right now going on. I mean, we've got a lot happening in Central America and in Africa and Tanzania specifically, and I think we will see not only a lot of new build activity like we're working on, but we will actually see reasonably good lease ups in those markets. And in many cases, particularly in Central America, we're pretty much through the churn, the consolidation churn. A lot of it has happened at this point. And so, we'll start to see that pullback. It's really Brazil, which we are obviously heavily indexed to Brazil. So, as Brazil goes, that kind of is the deciding factor for a lot of these things. And I think Brazil probably has another year beyond this year at least where things will be a little bit challenging on that front.

Thanks. And then, just maybe on share repurchases, how should we think about that? Are those likely to be on hold until the Millicom deal is completed? Or is it kind of in the independent of that and how you're thinking about it?

Yeah. I'd say it's somewhat independent of it. Obviously, we know that we have that commitment that we have approximately $1 billion of capital that we are obligated to pay out. And as I mentioned earlier, the timing of that, hopefully, will be earlier than what we put forth. That's what we're shooting for if we can make it happen. And if it is earlier, that means we have to have that ready and available, which we do, but it does influence our thinking a little bit. However, having said that, we typically have run our share buyback program and I expect it to be the same for the time being in a somewhat opportunistic manner. So, if we don't see other things going on and we see an opportunity where we think there's a meaningful dislocation that happens that doesn't make any sense to us, we may react more quickly to that.

Thank you.

Great. Thanks for taking my question. Another follow-up on the government policy. Can you talk about the potential for more spectrum auctions over the next couple of years? And if you're having any conversations with customers on how that would inform their intentions and how you can support them?

Yeah. So, obviously, that's one of the things that's being talked about by the new FCC that we are extremely favorable on and are very supportive of, as, of course, are the wireless MNOs here in the US. And so, I am hopeful that we will actually see an acceleration to improve the likelihood of having more spectrum auctioned off. But having said that, even if that is the case, with the current delay that's taken place and the time it will take to get to that and then ultimately for it to be cleared and available for deployment, you're talking about a number of years off into the future. And so, conversations that we have with our customers are less about what they'll need to do with potential new spectrum years from now. It's more about how do they optimize and maximize what they have today that they either still have to deploy or that they can maybe redesign a little bit in order to maximize what they're able to produce with the current holdings. So, that's the more immediate thing, and that's the type of thing that we would discuss rather than around future auctions at this stage.

Sure. That makes sense. And another issue, you're selling the portfolio in Colombia. Should we expect you to exit additional markets throughout this year, or is that process pretty much complete at this point?

No. I mean, it's not our intention to necessarily exit additional markets. In fact, as I mentioned, I think in my comments, we much prefer to not do that and to find ways towards improved scale and better positioning with the leading carriers in those markets. So that's what we're focused on. But having said that, in some cases like we did in Colombia, and like we did in the Philippines, if we come to the conclusion that we don't see a reasonable viable path to getting there anytime soon, then for purposes of being focused with our operations and where we are spending our time and energy, we would consider it. But it's not currently something that we have in the hopper.

Great. Thank you for the color.

Sure.