HIGHLIGHTS
Crown Castle International Corp. (NYSE:CCI) ("Crown Castle") today
reported results for the quarter ended September 30, 2015.
"As demonstrated by our increased Outlook for
2015 and initial Outlook for 2016, we strongly believe in the
long-term prospects for Crown Castle and our ability to deliver
attractive long-term total returns for our shareholders," stated
Ben Moreland, Crown Castle's President and Chief Executive
Officer. "Consistent with this view, I am pleased to announce
that our Board of Directors has once again increased our common
stock dividend, reflecting the continued strength of our business
and our commitment to disciplined capital allocation. Our
leadership position in U.S. wireless infrastructure and strong
balance sheet underscore our confidence that we can achieve our
goal of generating compounded annual growth in dividend per share
of 6% to 7% over the next several years, which is in-line with our
expectations for organic growth in AFFO per share. Our
confidence in delivering this level of growth is primarily driven
by our long-term, high quality tenant leases with contracted rent
escalations and our belief that leasing activity will continue at a
similar pace to what we have seen over the last several years as
all four major U.S. wireless carriers continue to upgrade and
enhance their networks to meet ever increasing consumer demand for
mobile broadband. We believe the expected growth in dividend
per share, together with our current dividend yield of
approximately 4%, represents an attractive long-term total return
profile for shareholders."
RESULTS FOR THE QUARTER
The table below sets forth select financial
results for the three month period ended September 30,
2015. For further information, refer to the financial
statements and non-GAAP and other calculation reconciliations
included in this press release.
($ in millions,except per share amounts) |
|
Actual |
|
Midpoint Q3 2015 Outlook |
|
Actual Compared to Outlook |
|
Q3 2014 |
|
Q3 2015 |
|
$ Change |
|
% Change |
|
|
Site Rental Revenues |
|
$ |
718 |
|
$ |
765 |
|
+$ |
47 |
|
|
7 |
% |
|
$ |
743 |
|
+$ |
22 |
|
Site Rental Gross Margin |
|
$ |
487 |
|
$ |
518 |
|
+$ |
31 |
|
|
6 |
% |
|
$ |
503 |
|
+$ |
15 |
|
Adjusted EBITDA |
|
$ |
514 |
|
$ |
529 |
|
+$ |
15 |
|
|
3 |
% |
|
$ |
513 |
|
+$ |
16 |
|
AFFO |
|
$ |
332 |
|
$ |
356 |
|
+$ |
24 |
|
|
7 |
% |
|
$ |
344 |
|
+$ |
12 |
|
AFFO per Share |
|
$ |
1.00 |
|
$ |
1.07 |
|
+$ |
0.07 |
|
|
7 |
% |
|
$ |
1.03 |
|
+$ |
0.04 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Crown Castle exceeded the high end of its previously provided
third quarter 2015 Outlook for site rental revenues, site rental
gross margin, Adjusted EBITDA and AFFO.
- During third quarter 2015, the Sunesys acquisition generated
$16 million in site rental revenues, $11 million in site rental
gross margin and $2 million in general and administrative
expenses. The previously provided third quarter 2015 Outlook
did not include the Sunesys acquisition, which closed on August 4,
2015.
- Site rental revenue growth of $47 million from third quarter
2014 to third quarter 2015 is comprised of $16 million in
contribution from Sunesys and $43 million in Organic Site Rental
Revenue growth, net of $12 million in adjustments for straight-line
accounting and other items. The Organic Site Rental Revenue
growth of $43 million represents approximately 6% year-over-year
growth, comprised of 10% growth from new leasing activity and
contracted tenant escalations, net of 4% from tenant
non-renewals.
DIVIDEND INCREASE
ANNOUNCEMENT
Crown Castle's Board of Directors has declared a
quarterly cash dividend of $0.885 per common share, representing an
increase of approximately 8% over the previous quarterly dividend
of $0.82 per share. The quarterly dividend will be payable on
December 31, 2015 to common stockholders of record at the close of
business on December 18, 2015. Future dividends are subject
to the approval of Crown Castle's Board of Directors.
INVESTING AND FINANCING ACTIVITIES
DURING THE QUARTER
During the third quarter of 2015, Crown Castle
invested approximately $237 million in capital expenditures,
comprised of $16 million of land purchases, $31 million of
sustaining capital expenditures and $190 million of revenue
generating capital expenditures. Revenue generating capital
expenditures consisted of $92 million on existing sites and $98
million on the construction of new sites, primarily small cell
construction activity.
On August 4, 2015, Crown Castle completed its
previously announced acquisition of Quanta Fiber Networks, Inc.
("Sunesys") for cash consideration of approximately $1
billion. Sunesys is a fiber services provider that owns or
has rights to nearly 10,000 miles of fiber in major metropolitan
markets across the U.S., where Crown Castle expects a meaningful
amount of future small cell activity to occur.
On September 30, 2015, Crown Castle paid a
quarterly common stock dividend of $0.82 per common share, or
approximately $274 million in aggregate. As a result of the
sale of CCAL, Crown Castle expects that a significant portion of
its common stock dividend distributions during 2015 will be
characterized as capital gains distributions.
As of September 30, 2015, Crown Castle had
approximately $184 million in cash and cash equivalents (excluding
restricted cash) and approximately $1.2 billion of availability
under its revolving credit facility.
"The excellent third quarter results allow us to
raise the midpoint of our full year 2015 Outlook for site rental
revenues, site rental gross margin, Adjusted EBITDA and AFFO,"
stated Jay Brown, Crown Castle's Chief Financial Officer.
"With our increased Outlook for 2015, we have set the stage for an
excellent 2016, as evidenced by our 2016 Outlook for AFFO per share
growth of 8%. Looking beyond 2016, our team is highly focused
on disciplined capital allocation in order to maximize long-term
total shareholder returns. Towards this end, with our
announced dividend increase, we are on track to return nearly $3
billion in capital to shareholders in the three year period ending
in 2016. At the same time, we are investing in and building a
team around our small cell capabilities, which we believe will
strengthen our leadership position in U.S. wireless infrastructure
and extend our runway of growth."
OUTLOOK
This Outlook section contains forward-looking
statements, and actual results may differ materially.
Information regarding potential risks which could cause actual
results to differ from the forward-looking statements herein is set
forth below and in Crown Castle's filings with the Securities and
Exchange Commission ("SEC").
The following table sets forth Crown Castle's
current Outlook for fourth quarter 2015, full year 2015 and full
year 2016:
(in millions, except per share amounts) |
|
Fourth Quarter 2015 |
|
Full Year 2015 |
|
Full Year 2016 |
|
Site
rental revenues |
|
$ |
778 |
|
to |
$ |
783 |
|
$ |
3,011 |
|
to |
$ |
3,016 |
|
$ |
3,152 |
|
to |
$ |
3,177 |
|
Site
rental cost of operations |
|
$ |
241 |
|
to |
$ |
246 |
|
$ |
957 |
|
to |
$ |
962 |
|
$ |
989 |
|
to |
$ |
1,014 |
|
Site
rental gross margin |
|
$ |
534 |
|
to |
$ |
539 |
|
$ |
2,050 |
|
to |
$ |
2,055 |
|
$ |
2,153 |
|
to |
$ |
2,178 |
|
Adjusted EBITDA(a) |
|
$ |
536 |
|
to |
$ |
541 |
|
$ |
2,115 |
|
to |
$ |
2,120 |
|
$ |
2,156 |
|
to |
$ |
2,181 |
|
Interest expense and
amortization of deferred financing costs(b) |
|
$ |
126 |
|
to |
$ |
131 |
|
$ |
525 |
|
to |
$ |
530 |
|
$ |
517 |
|
to |
$ |
537 |
|
FFO(a) |
|
$ |
368 |
|
to |
$ |
373 |
|
$ |
1,491 |
|
to |
$ |
1,496 |
|
$ |
1,467 |
|
to |
$ |
1,492 |
|
AFFO(a) |
|
$ |
368 |
|
to |
$ |
373 |
|
$ |
1,433 |
|
to |
$ |
1,438 |
|
$ |
1,550 |
|
to |
$ |
1,575 |
|
AFFO
per share(a)(c) |
|
$ |
1.10 |
|
to |
$ |
1.12 |
|
$ |
4.29 |
|
to |
$ |
4.31 |
|
$ |
4.62 |
|
to |
$ |
4.69 |
|
Net
income (loss) |
|
$ |
99 |
|
to |
$ |
132 |
|
$ |
1,481 |
|
to |
$ |
1,514 |
|
$ |
409 |
|
to |
$ |
508 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) See reconciliation of this non-GAAP financial measure to net
income (loss) included herein.(b) See the reconciliation of
"components of interest expense and amortization of deferred
financing costs" herein for a discussion of non-cash interest
expense.(c) Based on diluted shares outstanding as of
September 30, 2015 of approximately 334 million shares for
fourth quarter 2015 and full year 2015. Full year 2016 assumes
diluted shares outstanding of approximately 336 million shares,
inclusive of the assumed conversion of the mandatory convertible
preferred stock in November 2016.
Full Year 2015 Outlook
The table below compares the previously provided
and current full year 2015 Outlook for select metrics:
|
|
Midpoint |
|
Current Outlook Compared toPrevious
Outlook |
|
($ in
millions) |
|
Previously Provided Full Year 2015 Outlook |
|
Current Full Year2015 Outlook |
|
Site Rental Revenues |
|
$ |
2,954 |
|
$ |
3,014 |
|
+$ |
60 |
|
Site Rental Gross Margin |
|
$ |
2,005 |
|
$ |
2,053 |
|
+$ |
48 |
|
Adjusted EBITDA |
|
$ |
2,081 |
|
$ |
2,118 |
|
+$ |
37 |
|
AFFO |
|
$ |
1,413 |
|
$ |
1,436 |
|
+$ |
23 |
|
|
|
|
|
|
|
|
|
|
|
|
- The increase in full year 2015 Outlook reflects the
contribution from the Sunesys acquisition, the results from the
third quarter and the expected timing benefit from tenant
non-renewals occurring later than previously expected.
- The Sunesys acquisition is expected to generate approximately
$40 million in site rental revenues, $30 million in site rental
gross margin and $6 million in general and administrative expenses
during 2015.
- Additional information regarding Crown Castle's expectations
for site rental revenue growth, including tenant non-renewals, is
available in Crown Castle's quarterly Supplemental Information
Package posted in the Investors section of its website.
Full Year 2016 Outlook
The table below compares the full year 2015
Outlook and full year 2016 Outlook for select metrics:
|
|
Midpoint |
|
$ Growth |
|
% Growth |
($ in
millions, except for per share amounts) |
|
Full Year 2015 Outlook |
|
Full Year 2016 Outlook |
|
Site Rental Revenues |
|
$ |
3,014 |
|
$ |
3,165 |
|
+$ |
151 |
|
|
5 |
% |
Site Rental Gross Margin |
|
$ |
2,053 |
|
$ |
2,166 |
|
+$ |
113 |
|
|
6 |
% |
Adjusted EBITDA |
|
$ |
2,118 |
|
$ |
2,169 |
|
+$ |
51 |
|
|
2 |
% |
AFFO |
|
$ |
1,436 |
|
$ |
1,563 |
|
+$ |
127 |
|
|
9 |
% |
AFFO per Share |
|
$ |
4.30 |
|
$ |
4.66 |
|
+$ |
0.36 |
|
|
8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- The chart below reconciles the components of expected growth in
site rental revenues from 2015 to 2016 of approximately $151
million at the midpoint.
A chart accompanying this release is available
at http://www.globenewswire.com/NewsRoom/AttachmentNg/2b9d6332-d73a-40ab-a6cf-77623b8835fe
- The full year 2016 Outlook for Organic Site Rental Revenue
growth of approximately $160 million is comprised of approximately
$170 million from new leasing activity and $95 million from
escalations on existing tenant lease contracts, less approximately
$105 million from non-renewals. Of the approximately $170
million in new leasing activity, expected contributions from tower
leasing and small cells leasing are approximately $115 million and
$55 million, respectively.
- The chart below reconciles the components of expected growth in
AFFO from 2015 to 2016 of approximately $127 million at the
midpoint.
A chart accompanying this release is available
at http://www.globenewswire.com/NewsRoom/AttachmentNg/8d1202d7-afb0-4bc8-9a6a-c451fbd5f80c
- Network services gross margin contribution for full year 2016
is expected to be approximately $230 million to $250 million
compared to full year 2015 expectation of $280 million to $285
million. The year-over-year decline is primarily driven by
equipment decommissioning fees generated during 2015 which are not
expected to recur in 2016.
- Sunesys is expected to generate approximately $105 million in
site rental revenues, $75 million site rental gross margin and $15
million in general and administrative expenses.
CONFERENCE CALL DETAILS
Crown Castle has scheduled a conference call for
Thursday, October 22, 2015, at 10:30 a.m. Eastern Time. The
conference call may be accessed by dialing 800-289-0498 and asking
for the Crown Castle call (access code 751635) at least 30 minutes
prior to the start time. The conference call may also be
accessed live over the Internet at
http://investor.crowncastle.com. Supplemental materials for
the call have been posted on the Crown Castle website at
http://investor.crowncastle.com.
A telephonic replay of the conference call will
be available from 1:30 p.m. Eastern Time on Thursday, October 22,
2015, through 1:30 p.m. Eastern Time on Wednesday, January 20, 2016
and may be accessed by dialing 888-203-1112 and using access code
751635. An audio archive will also be available on the
company's website at http://investor.crowncastle.com shortly
after the call and will be accessible for approximately 90
days.
ABOUT CROWN CASTLE
Crown Castle provides wireless carriers with the
infrastructure they need to keep people connected and businesses
running. With approximately 40,000 towers and 15,000 small cell
nodes supported by approximately 16,000 miles of fiber, Crown
Castle is the nation's largest provider of shared wireless
infrastructure with a significant presence in the top 100 US
markets. For more information on Crown Castle, please visit
www.crowncastle.com.
Non-GAAP Financial Measures and Other
Calculations
This press release includes presentations of
Adjusted EBITDA, Funds from Operations, Adjusted Funds from
Operations, Organic Site Rental Revenues, and Site Rental Revenues,
as Adjusted, which are non-GAAP financial measures. These
non-GAAP financial measures are not intended as alternative
measures of operating results or cash flow from operations (as
determined in accordance with Generally Accepted Accounting
Principles ("GAAP")). Each of the amounts included in the
calculation of Adjusted EBITDA, FFO, AFFO, Organic Site Rental
Revenues, and Site Rental Revenues, as Adjusted, are computed in
accordance with GAAP, with the exception of: (1) sustaining capital
expenditures, which is not defined under GAAP and (2) our
adjustment to the income tax provision in calculations of AFFO for
periods prior to our REIT conversion.
Our measures of Adjusted EBITDA, FFO, AFFO,
Organic Site Rental Revenues and Site Rental Revenues, as Adjusted,
may not be comparable to similarly titled measures of other
companies, including other companies in the tower sector or those
reported by other REITs. Our FFO and AFFO may not be
comparable to those reported in accordance with National
Association of Real Estate Investment Trusts, including with
respect to the impact of income taxes for periods prior to our REIT
conversion.
Adjusted EBITDA, FFO, AFFO, Organic Site Rental
Revenues and Site Rental Revenues, as Adjusted, are presented as
additional information because management believes these measures
are useful indicators of the financial performance of our core
businesses. In addition, Adjusted EBITDA is a measure of
current financial performance used in our debt covenant
calculations.
Adjusted EBITDA. Crown Castle defines Adjusted
EBITDA as net income (loss) plus restructuring charges (credits),
asset write-down charges, acquisition and integration costs,
depreciation, amortization and accretion, amortization of prepaid
lease purchase price adjustments, interest expense and amortization
of deferred financing costs, gains (losses) on retirement of
long-term obligations, net gain (loss) on interest rate swaps,
gains (losses) on foreign currency swaps, impairment of
available-for-sale securities, interest income, other income
(expense), benefit (provision) for income taxes, cumulative effect
of a change in accounting principle, income (loss) from
discontinued operations and stock-based compensation expense.
Funds from Operations ("FFO"). Crown Castle
defines Funds from Operations as net income plus real estate
related depreciation, amortization and accretion and asset
write-down charges, less noncontrolling interest and cash paid for
preferred stock dividends, and is a measure of funds from
operations attributable to CCIC common stockholders.
FFO per share. Crown Castle defines FFO per
share as FFO divided by the diluted weighted average common shares
outstanding.
Adjusted Funds from Operations ("AFFO").
Crown Castle defines Adjusted Funds from Operations as FFO before
straight-line revenue, straight-line expense, stock-based
compensation expense, non-cash portion of tax provision, non-real
estate related depreciation, amortization and accretion,
amortization of non-cash interest expense, other (income) expense,
gain (loss) on retirement of long-term obligations, net gain (loss)
on interest rate swaps, gains (losses) on foreign currency swaps,
acquisition and integration costs, and adjustments for
noncontrolling interests, and less capital improvement capital
expenditures and corporate capital expenditures.
AFFO per share. Crown Castle defines AFFO per
share as AFFO divided by diluted weighted average common shares
outstanding.
Site Rental Revenues, as Adjusted. Crown Castle
defines Site Rental Revenues, as Adjusted, as site rental revenues,
as reported, less straight-line revenues.
Organic Site Rental Revenues. Crown Castle
defines Organic Site Rental Revenues as site rental revenues, as
reported, less straight-line revenues, the impact of tower
acquisitions and construction, foreign currency adjustments and
certain non recurring items.
Sustaining capital expenditures. Crown
Castle defines sustaining capital expenditures as either (1)
corporate related capital improvements, such as buildings,
information technology equipment and office equipment or (2)
capital improvements to tower sites that enable our customers'
ongoing quiet enjoyment of the tower.
The tables set forth below reconcile these
non-GAAP financial measures to comparable GAAP financial
measures. The components in these tables may not sum to the
total due to rounding.
Reconciliations of Non-GAAP Financial Measures to
Comparable GAAP Financial Measures and Other
Calculations:
Adjusted EBITDA for the three months
ended September 30, 2015 and 2014 is computed as
follows:
|
For the Three Months Ended |
|
September 30, 2015 |
|
September 30, 2014 |
(in millions) |
|
|
|
Net income (loss) |
$ |
103.8 |
|
|
$ |
108.0 |
|
Adjustments to increase
(decrease) net income (loss): |
|
|
|
Income (loss) from discontinued
operations |
0.5 |
|
|
(8.9 |
) |
Asset write-down charges |
7.5 |
|
|
4.9 |
|
Acquisition and integration
costs |
7.6 |
|
|
4.1 |
|
Depreciation, amortization and
accretion |
261.7 |
|
|
247.2 |
|
Amortization of prepaid lease
purchase price adjustments |
5.1 |
|
|
5.0 |
|
Interest expense and amortization
of deferred financing costs(a) |
129.9 |
|
|
141.3 |
|
Interest income |
(0.8 |
) |
|
(0.1 |
) |
Other income (expense) |
1.2 |
|
|
0.7 |
|
Benefit (provision) for income
taxes |
(3.8 |
) |
|
(2.0 |
) |
Stock-based compensation
expense |
16.5 |
|
|
13.4 |
|
Adjusted
EBITDA(b) |
$ |
529.2 |
|
|
$ |
513.6 |
|
|
|
|
|
|
|
|
|
(a) See the reconciliation of "components of
interest expense and amortization of deferred financing costs"
herein for a discussion of non-cash interest expense.
(b) The above reconciliation excludes line items
included in our definition which are not applicable for the periods
shown.
Adjusted EBITDA for the quarter ending December 31,
2015 and the years ending December 31, 2015 and
December 31, 2016 are forecasted as follows:
|
Q4 2015 |
|
Full Year 2015 |
|
Full Year 2016 |
(in
millions) |
Outlook |
|
Outlook |
|
Outlook |
Net income (loss) |
$ |
99 |
|
to |
$ |
132 |
|
|
$ |
1,481 |
|
to |
$ |
1,514 |
|
|
$ |
409 |
|
to |
$ |
508 |
|
Adjustments to increase
(decrease) net income (loss): |
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from discontinued
operations |
$ |
0 |
|
to |
$ |
0 |
|
|
$ |
(1,001 |
) |
to |
$ |
(1,001 |
) |
|
$ |
0 |
|
to |
$ |
0 |
|
Asset write-down charges |
$ |
4 |
|
to |
$ |
6 |
|
|
$ |
24 |
|
to |
$ |
26 |
|
|
$ |
15 |
|
to |
$ |
25 |
|
Acquisition and integration
costs |
$ |
2 |
|
to |
$ |
5 |
|
|
$ |
14 |
|
to |
$ |
17 |
|
|
$ |
10 |
|
to |
$ |
15 |
|
Depreciation, amortization and
accretion |
$ |
263 |
|
to |
$ |
268 |
|
|
$ |
1,030 |
|
to |
$ |
1,035 |
|
|
$ |
1,050 |
|
to |
$ |
1,070 |
|
Amortization of prepaid lease
purchase price adjustments |
$ |
4 |
|
to |
$ |
6 |
|
|
$ |
20 |
|
to |
$ |
22 |
|
|
$ |
20 |
|
to |
$ |
22 |
|
Interest expense and amortization
of deferred financing costs(a) |
$ |
126 |
|
to |
$ |
131 |
|
|
$ |
525 |
|
to |
$ |
530 |
|
|
$ |
517 |
|
to |
$ |
537 |
|
Gains (losses) on retirement of
long-term obligations |
$ |
0 |
|
to |
$ |
0 |
|
|
$ |
4 |
|
to |
$ |
4 |
|
|
$ |
0 |
|
to |
$ |
0 |
|
Interest income |
$ |
(2 |
) |
to |
$ |
0 |
|
|
$ |
(3 |
) |
to |
$ |
(1 |
) |
|
$ |
(3 |
) |
to |
$ |
(1 |
) |
Other income (expense) |
$ |
0 |
|
to |
$ |
3 |
|
|
$ |
(59 |
) |
to |
$ |
(56 |
) |
|
$ |
1 |
|
to |
$ |
3 |
|
Benefit (provision) for income
taxes |
$ |
(3 |
) |
to |
$ |
1 |
|
|
$ |
(13 |
) |
to |
$ |
(9 |
) |
|
$ |
(10 |
) |
to |
$ |
(2 |
) |
Stock-based compensation
expense |
$ |
15 |
|
to |
$ |
17 |
|
|
$ |
65 |
|
to |
$ |
67 |
|
|
$ |
73 |
|
to |
$ |
78 |
|
Adjusted
EBITDA(b) |
$ |
536 |
|
to |
$ |
541 |
|
|
$ |
2,115 |
|
to |
$ |
2,120 |
|
|
$ |
2,156 |
|
to |
$ |
2,181 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) See the reconciliation of "components of
interest expense and amortization of deferred financing costs"
herein for a discussion of non-cash interest expense.
(b) The above reconciliation excludes line items
included in our definition which are not applicable for the periods
shown.
FFO and AFFO for the quarter ending December 31,
2015 and the years ending December 31, 2015 and
December 31, 2016 are forecasted as follows:
|
Q4 2015 |
|
Full Year 2015 |
|
Full Year 2016 |
(in millions, except
share and per share amounts) |
Outlook |
|
Outlook |
|
Outlook |
Net income(a) |
$ |
99 |
|
to |
$ |
132 |
|
|
$ |
480 |
|
to |
$ |
513 |
|
|
$ |
409 |
|
to |
$ |
508 |
|
Real estate related
depreciation, amortization and accretion |
$ |
259 |
|
to |
$ |
262 |
|
|
$ |
1,013 |
|
to |
$ |
1,016 |
|
|
$ |
1,034 |
|
to |
$ |
1,049 |
|
Asset write-down
charges |
$ |
4 |
|
to |
$ |
6 |
|
|
$ |
24 |
|
to |
$ |
26 |
|
|
$ |
15 |
|
to |
$ |
25 |
|
Dividends on preferred
stock |
$ |
(11 |
) |
to |
$ |
(11 |
) |
|
$ |
(44 |
) |
to |
$ |
(44 |
) |
|
$ |
(44 |
) |
to |
$ |
(44 |
) |
FFO(c)(d)(f) |
$ |
368 |
|
to |
$ |
373 |
|
|
$ |
1,491 |
|
to |
$ |
1,496 |
|
|
$ |
1,467 |
|
to |
$ |
1,492 |
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO (from above) |
$ |
368 |
|
to |
$ |
373 |
|
|
$ |
1,491 |
|
to |
$ |
1,496 |
|
|
$ |
1,467 |
|
to |
$ |
1,492 |
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
|
|
|
|
Straight-line revenue |
$ |
(26 |
) |
to |
$ |
(21 |
) |
|
$ |
(115 |
) |
to |
$ |
(110 |
) |
|
$ |
(48 |
) |
to |
$ |
(33 |
) |
Straight-line expense |
$ |
21 |
|
to |
$ |
26 |
|
|
$ |
95 |
|
to |
$ |
100 |
|
|
$ |
80 |
|
to |
$ |
95 |
|
Stock-based compensation
expense |
$ |
15 |
|
to |
$ |
17 |
|
|
$ |
65 |
|
to |
$ |
67 |
|
|
$ |
73 |
|
to |
$ |
78 |
|
Non-cash portion of tax
provision |
$ |
(6 |
) |
to |
$ |
(1 |
) |
|
$ |
(26 |
) |
to |
$ |
(21 |
) |
|
$ |
(21 |
) |
to |
$ |
(6 |
) |
Non-real estate related
depreciation, amortization and accretion |
$ |
4 |
|
to |
$ |
6 |
|
|
$ |
17 |
|
to |
$ |
19 |
|
|
$ |
16 |
|
to |
$ |
21 |
|
Amortization of non-cash interest
expense |
$ |
4 |
|
to |
$ |
7 |
|
|
$ |
37 |
|
to |
$ |
40 |
|
|
$ |
17 |
|
to |
$ |
23 |
|
Other (income) expense |
$ |
0 |
|
to |
$ |
3 |
|
|
$ |
(59 |
) |
to |
$ |
(56 |
) |
|
$ |
1 |
|
to |
$ |
3 |
|
Gains (losses) on retirement of
long-term obligations |
$ |
0 |
|
to |
$ |
0 |
|
|
$ |
4 |
|
to |
$ |
4 |
|
|
$ |
0 |
|
to |
$ |
0 |
|
Acquisition and integration
costs |
$ |
2 |
|
to |
$ |
5 |
|
|
$ |
14 |
|
to |
$ |
17 |
|
|
$ |
10 |
|
to |
$ |
15 |
|
Capital improvement capital
expenditures |
$ |
(13 |
) |
to |
$ |
(11 |
) |
|
$ |
(45 |
) |
to |
$ |
(43 |
) |
|
$ |
(48 |
) |
to |
$ |
(43 |
) |
Corporate capital expenditures |
$ |
(16 |
) |
to |
$ |
(14 |
) |
|
$ |
(59 |
) |
to |
$ |
(57 |
) |
|
$ |
(31 |
) |
to |
$ |
(26 |
) |
AFFO(c)(d)(f) |
$ |
368 |
|
to |
$ |
373 |
|
|
$ |
1,433 |
|
to |
$ |
1,438 |
|
|
$ |
1,550 |
|
to |
$ |
1,575 |
|
Weighted average common shares
outstanding — diluted(b)(e) |
|
333.8 |
|
|
|
333.8 |
|
|
|
335.8 |
|
AFFO per
share(c)(f) |
$ |
1.10 |
|
to |
$ |
1.12 |
|
|
$ |
4.29 |
|
to |
$ |
4.31 |
|
|
$ |
4.62 |
|
to |
$ |
4.69 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) For full year 2015 Outlook, net income is
exclusive of income from discontinued operations of $1.0 billion
and related noncontrolling interest.
(b) Based on diluted shares outstanding as of
September 30, 2015 of approximately 334 million shares for
fourth quarter 2015 and full year 2015. Full year 2016 assumes
diluted shares outstanding of approximately 336 million shares,
inclusive of the assumed conversion of the mandatory convertible
preferred stock in November 2016.
(c) See "Non-GAAP Financial Measures and Other
Calculations" herein for a discussion for our definitions of FFO
and AFFO.
(d) FFO and AFFO are reduced by cash paid for
preferred stock dividends.
(e) The diluted weighted average common shares
outstanding assumes no conversion of preferred stock in the share
count other than as discussed in footnote (b).
(f) The above reconciliation excludes line items
included in our definition which are not applicable for the periods
shown.
Organic Site Rental Revenue growth for the years ending
December 31, 2015 and December 31, 2016 is forecasted as
follows:
|
|
|
Midpoint of Full Year |
|
Midpoint of Full Year |
(in millions of
dollars) |
Full Year 2014 |
|
2015 Outlook |
|
2016 Outlook |
GAAP site rental
revenues |
$ |
2,867 |
|
|
$ |
3,014 |
|
|
$ |
3,165 |
|
Site rental
straight-line revenues |
(183 |
) |
|
(113 |
) |
|
(41 |
) |
Other -
Non-recurring |
(5 |
) |
|
— |
|
|
— |
|
Site Rental Revenues,
as Adjusted(a)(c) |
$ |
2,678 |
|
|
$ |
2,901 |
|
|
$ |
3,124 |
|
Cash adjustments: |
|
|
|
|
|
Other |
|
|
|
– |
|
|
|
– |
|
Acquisitions and
builds(b) |
|
|
(63 |
) |
|
(62 |
) |
Organic Site Rental
Revenues(a)(c)(d) |
|
|
$ |
2,838 |
|
|
$ |
3,062 |
|
Year-Over-Year
Revenue Growth |
|
|
|
|
|
GAAP site rental
revenues |
|
|
5.1 |
% |
|
5.0 |
% |
Site Rental Revenues,
as Adjusted |
|
|
8.3 |
% |
|
7.7 |
% |
Organic Site Rental
Revenues(e)(f) |
|
|
6.0 |
% |
|
5.5 |
% |
|
|
|
|
|
|
|
|
(a) Includes amortization of prepaid rent.
(b) The financial impact of acquisitions and tower builds is
excluded from organic site rental revenues until the one-year
anniversary of the acquisition or build.
(c) Includes Site Rental Revenues, as Adjusted, from the
construction of new small cell nodes.
(d) See "Non-GAAP Financial Measures and Other Calculations"
herein.
(e) Year-over-year Organic Site Rental Revenue growth for the
years ending December 31, 2015 and December 31, 2016:
|
Midpoint of Full Year 2015 Outlook |
|
Midpoint of Full Year 2016 Outlook |
New leasing
activity |
6.3 |
% |
|
5.9 |
% |
Escalators |
3.5 |
% |
|
3.3 |
% |
Organic Site Rental
Revenue growth, before non-renewals |
9.8 |
% |
|
9.2 |
% |
Non-renewals |
(3.8 |
)% |
|
(3.7 |
)% |
Organic Site Rental
Revenue growth |
6.0 |
% |
|
5.5 |
% |
|
|
|
|
|
|
(f) Calculated as the percentage change from Site Rental
Revenues, as Adjusted, for the prior period when compared to
Organic Site Rental Revenue for the current period.
Organic Site Rental Revenue growth for the quarter ended
September 30, 2015 is as follows:
|
Three Months Ended September 30, |
(in millions of
dollars) |
2015 |
|
2014 |
Reported GAAP site
rental revenues |
$ |
765 |
|
|
$ |
718 |
|
Site rental
straight-line revenues |
(27 |
) |
|
(46 |
) |
Other -
Non-recurring |
|
– |
|
|
|
– |
|
Site Rental Revenues,
as Adjusted(a)(c) |
$ |
737 |
|
|
$ |
672 |
|
Cash adjustments: |
|
|
|
Other |
|
– |
|
|
|
Acquisitions and
builds(b) |
(22 |
) |
|
|
Organic Site Rental
Revenues(a)(c)(d) |
$ |
715 |
|
|
|
Year-Over-Year
Revenue Growth |
|
|
|
Reported GAAP site
rental revenues |
6.5 |
% |
|
|
Site Rental Revenues,
as Adjusted |
9.8 |
% |
|
|
Organic Site Rental
Revenues(e)(f) |
6.4 |
% |
|
|
|
|
|
|
|
(a) Includes amortization of prepaid rent.
(b) The financial impact of acquisitions and tower builds is
excluded from organic site rental revenues until the one-year
anniversary of the acquisition or build.
(c) Includes Site Rental Revenues, as Adjusted from the
construction of new small cell nodes.
(d) See "Non-GAAP Financial Measures and Other Calculations"
herein.
(e) Quarter-over-quarter Organic Site Rental Revenue growth for
the quarter ending September 30, 2015:
|
Three Months Ended September 30, 2015 |
New leasing
activity |
6.6 |
% |
Escalators |
3.5 |
% |
Organic Site Rental
Revenue growth, before non-renewals |
10.0 |
% |
Non-renewals |
(3.6 |
)% |
Organic Site Rental
Revenue Growth |
6.4 |
% |
|
|
|
(f) Calculated as the percentage change from Site Rental
Revenues, as Adjusted, for the prior period when compared to
Organic Site Rental Revenues for the current period.
FFO and AFFO for the three and nine months ended
September 30, 2015 and 2014 are computed as
follows:
|
For the Three Months |
|
For the Nine Months Ended |
(in millions, except
share and per share amounts) |
September 30, 2015 |
|
September 30, 2014 |
|
September 30, 2015 |
|
September 30, 2014 |
Net income(a) |
$ |
104.3 |
|
|
$ |
99.2 |
|
|
$ |
382.6 |
|
|
$ |
217.7 |
|
Real estate related
depreciation, amortization and accretion |
257.0 |
|
|
243.6 |
|
|
753.6 |
|
|
728.5 |
|
Asset write-down
charges |
7.5 |
|
|
4.9 |
|
|
19.7 |
|
|
10.7 |
|
Dividends on preferred
stock |
(11.0 |
) |
|
(11.0 |
) |
|
(33.0 |
) |
|
(33.0 |
) |
FFO(b)(c)(e) |
$ |
357.8 |
|
|
$ |
336.7 |
|
|
$ |
1,122.8 |
|
|
$ |
923.9 |
|
Weighted average common shares
outstanding — diluted(d) |
333.7 |
|
|
333.2 |
|
|
333.7 |
|
|
333.0 |
|
FFO per
share(b)(e) |
$ |
1.07 |
|
|
$ |
1.01 |
|
|
$ |
3.36 |
|
|
$ |
2.77 |
|
|
|
|
|
|
|
|
|
FFO (from above) |
$ |
357.8 |
|
|
$ |
336.7 |
|
|
$ |
1,122.8 |
|
|
$ |
923.9 |
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
Straight-line revenue |
(27.1 |
) |
|
(45.7 |
) |
|
(89.0 |
) |
|
(144.7 |
) |
Straight-line expense |
24.4 |
|
|
24.1 |
|
|
74.0 |
|
|
76.0 |
|
Stock-based compensation
expense |
16.5 |
|
|
13.4 |
|
|
49.3 |
|
|
43.2 |
|
Non-cash portion of tax
provision |
(5.9 |
) |
|
(4.7 |
) |
|
(20.3 |
) |
|
(14.6 |
) |
Non-real estate related
depreciation, amortization and accretion |
4.6 |
|
|
3.6 |
|
|
13.0 |
|
|
10.5 |
|
Amortization of non-cash interest
expense |
8.6 |
|
|
19.8 |
|
|
32.4 |
|
|
61.3 |
|
Other (income) expense |
1.2 |
|
|
0.7 |
|
|
(58.5 |
) |
|
9.4 |
|
Gains (losses) on retirement of
long-term obligations |
— |
|
|
— |
|
|
4.2 |
|
|
44.6 |
|
Acquisition and integration
costs |
7.6 |
|
|
4.1 |
|
|
12.0 |
|
|
28.9 |
|
Capital improvement capital
expenditures |
(14.4 |
) |
|
(7.5 |
) |
|
(32.5 |
) |
|
(15.5 |
) |
Corporate capital expenditures |
(17.0 |
) |
|
(12.1 |
) |
|
(42.9 |
) |
|
(27.2 |
) |
AFFO(b)(c)(e) |
$ |
356.4 |
|
|
$ |
332.2 |
|
|
$ |
1,064.4 |
|
|
$ |
995.7 |
|
Weighted average common shares
outstanding — diluted(d) |
333.7 |
|
|
333.2 |
|
|
333.7 |
|
|
333.0 |
|
AFFO per
share(b)(e) |
$ |
1.07 |
|
|
$ |
1.00 |
|
|
$ |
3.19 |
|
|
$ |
2.99 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Exclusive of income (loss) from discontinued operations and
related noncontrolling interest of $(0.5 million) and $9 million
for the three months ended September 30, 2015 and 2014,
respectively and $1.0 billion and $29 million for the nine months
ended September 30, 2015 and 2014, respectively.
(b) See "Non-GAAP Financial Measures and Other Calculations"
herein for a discussion of our definitions of FFO and AFFO.
(c) FFO and AFFO are reduced by cash paid for preferred stock
dividends.
(d) The diluted weighted average common shares outstanding
assumes no conversion of preferred stock in the share count.
(e) The above reconciliation excludes line items included in our
definition which are not applicable for the periods shown.
The components of interest expense and amortization of
deferred financing costs for the three months ended
September 30, 2015 and 2014 are as follows:
|
For the Three Months Ended |
(in millions) |
September 30, 2015 |
|
September 30, 2014 |
Interest expense on
debt obligations |
$ |
121.3 |
|
|
$ |
121.5 |
|
Amortization of
deferred financing costs |
5.5 |
|
|
5.5 |
|
Amortization of
adjustments on long-term debt |
0.1 |
|
|
(0.9 |
) |
Amortization of
interest rate swaps(a) |
3.7 |
|
|
15.6 |
|
Other, net |
(0.7 |
) |
|
(0.3 |
) |
Interest
expense and amortization of deferred financing costs |
$ |
129.9 |
|
|
$ |
141.3 |
|
|
|
|
|
|
|
|
|
(a) Relates to the amortization of interest rate swaps; the
swaps were cash settled in prior periods.
The components of interest expense and
amortization of deferred financing costs for the quarter ending
December 31, 2015 and the years ending December 31, 2015
and December 31, 2016 are forecasted as follows:
|
Q4 2015 |
|
Full Year 2015 |
|
Full Year 2016 |
(in millions) |
Outlook |
|
Outlook |
|
Outlook |
Interest expense on
debt obligations |
$ |
123 |
|
to |
$ |
125 |
|
|
$ |
489 |
|
to |
$ |
491 |
|
|
$ |
502 |
|
to |
$ |
512 |
|
Amortization of
deferred financing costs |
$ |
4 |
|
to |
$ |
6 |
|
|
$ |
21 |
|
to |
$ |
23 |
|
|
$ |
21 |
|
to |
$ |
23 |
|
Amortization of
adjustments on long-term debt |
$ |
0 |
|
to |
$ |
1 |
|
|
$ |
(1 |
) |
to |
$ |
0 |
|
|
$ |
(1 |
) |
to |
$ |
1 |
|
Amortization of
interest rate swaps(a) |
$ |
0 |
|
to |
$ |
0 |
|
|
$ |
19 |
|
to |
$ |
19 |
|
|
$ |
0 |
|
to |
$ |
0 |
|
Other, net |
$ |
0 |
|
to |
$ |
0 |
|
|
$ |
(2 |
) |
to |
$ |
(2 |
) |
|
$ |
(3 |
) |
to |
$ |
(1 |
) |
Interest
expense and amortization of deferred financing costs |
$ |
126 |
|
to |
$ |
131 |
|
|
$ |
525 |
|
to |
$ |
530 |
|
|
$ |
517 |
|
to |
$ |
537 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Relates to the amortization of interest rate swaps, all of
which has been cash settled in prior periods.
Sustaining capital expenditures for the
three months ended September 30, 2015 and 2014 is computed as
follows:
|
For the Three Months Ended |
(in millions) |
September 30, 2015 |
|
September 30, 2014 |
Capital
Expenditures |
$ |
237.4 |
|
|
$ |
199.7 |
|
Less: Land
purchases |
16.0 |
|
|
15.1 |
|
Less: Wireless
infrastructure construction and improvements |
190.1 |
|
|
164.9 |
|
Sustaining
capital expenditures |
$ |
31.3 |
|
|
$ |
19.7 |
|
|
|
|
|
|
|
|
|
Cautionary Language Regarding
Forward-Looking Statements
This press release contains forward-looking
statements and information that are based on our management's
current expectations. Such statements include our Outlook and
plans, projections, and estimates regarding (1) potential benefits,
returns and shareholder value which may be derived from our
business, assets, investments, dividends and acquisitions,
including on a long-term basis, (2) our strategy and strategic
position and strength of our business, (3) wireless consumer
demand, (4) demand for our wireless infrastructure and services,
(5) carrier network investments and upgrades, and the benefits
which may be derived therefrom, (6) our growth and long-term
prospects, (7) our dividends, including our dividend plans, the
amount and growth of our dividends, the potential benefits
therefrom and the tax characterization thereof, (8) leasing
activity, including the impact of such leasing activity on our
results and Outlook, (9) capital allocation, (10) the Sunesys
acquisition, including potential benefits and impact therefrom and
growth related thereto, (11) our investments, including in small
cells, and the potential benefits therefrom, (12) availability and
adequacy of cash flows and liquidity for, or plans regarding,
future discretionary investments, (13) the location and level of
our activities, including with respect to small cells, (14)
non-renewal of leases and decommissioning of networks, including
timing, the impact thereof and decommissioning fees, (15) capital
expenditures, including sustaining capital expenditures, (16)
timing items, (17) straight-line adjustments, (18) tower
acquisitions and builds, (19) expenses, including general and
administrative expense, (20) site rental revenues and Site Rental
Revenues, as Adjusted, (21) site rental cost of operations, (22)
site rental gross margin and network services gross margin, (23)
Adjusted EBITDA, (24) interest expense and amortization of deferred
financing costs, (25) FFO, including on a per share basis, (26)
AFFO, including on a per share basis, (27) Organic Site Rental
Revenues and Organic Site Rental Revenue growth, (28) net income
(loss), including on a per share basis, (29) our common shares
outstanding, including on a diluted basis, and (30) the utility of
certain financial measures, including non-GAAP financial
measures. Such forward-looking statements are subject to
certain risks, uncertainties and assumptions prevailing market
conditions and the following:
- Our business depends on the demand for wireless communications
and wireless infrastructure, and we may be adversely affected by
any slowdown in such demand. Additionally, a reduction in carrier
network investment may materially and adversely affect our business
(including reducing demand for new tenant additions and network
services).
- A substantial portion of our revenues is derived from a small
number of customers, and the loss, consolidation or financial
instability of any of our limited number of customers may
materially decrease revenues or reduce demand for our wireless
infrastructure and network services.
- Our substantial level of indebtedness could adversely affect
our ability to react to changes in our business, and the terms of
our debt instruments and 4.50% Mandatory Convertible Preferred
Stock limit our ability to take a number of actions that our
management might otherwise believe to be in our best interests. In
addition, if we fail to comply with our covenants, our debt could
be accelerated.
- We have a substantial amount of indebtedness. In the event we
do not repay or refinance such indebtedness, we could face
substantial liquidity issues and might be required to issue equity
securities or securities convertible into equity securities, or
sell some of our assets to meet our debt payment obligations.
- Sales or issuances of a substantial number of shares of our
common stock may adversely affect the market price of our common
stock.
- As a result of competition in our industry, including from some
competitors with significantly more resources or less debt than we
have, we may find it more difficult to achieve favorable rental
rates on our new or renewing customer contracts.
- The business model for our small cell operations contains
differences from our traditional site rental business, resulting in
different operational risks. If we do not successfully operate that
business model or identify or manage those operational risks, such
operations may produce results that are less than anticipated.
- New technologies may significantly reduce demand for our
wireless infrastructure and negatively impact our revenues.
- New wireless technologies may not deploy or be adopted by
customers as rapidly or in the manner projected.
- If we fail to retain rights to our wireless infrastructure,
including the land under our sites, our business may be adversely
affected.
- Our network services business has historically experienced
significant volatility in demand, which reduces the predictability
of our results.
- The expansion and development of our business, including
through acquisitions, increased product offerings, or other
strategic growth opportunities, may cause disruptions in our
business, which may have an adverse effect on our business,
operations or financial results.
- If we fail to comply with laws and regulations which regulate
our business and which may change at any time, we may be fined or
even lose our right to conduct some of our business.
- If radio frequency emissions from wireless handsets or
equipment on our wireless infrastructure are demonstrated to cause
negative health effects, potential future claims could adversely
affect our operations, costs or revenues.
- Certain provisions of our certificate of incorporation, bylaws
and operative agreements, and domestic and international
competition laws may make it more difficult for a third party to
acquire control of us or for us to acquire control of a third
party, even if such a change in control would be beneficial to our
stockholders.
- Future dividend payments to our stockholders will reduce the
availability of our cash on hand available to fund future
discretionary investments, and may result in a need to incur
indebtedness or issue equity securities to fund growth
opportunities. In such event, the then current economic,
credit market or equity market conditions will impact the
availability or cost of such financing, which may hinder our
ability to grow our per share results of operations.
- Remaining qualified to be taxed as a REIT involves highly
technical and complex provisions of the US Internal Revenue
Code. Failure to remain qualified as a REIT would result in
our inability to deduct dividends to stockholders when computing
our taxable income, which would reduce our available cash.
- Complying with REIT requirements, including the 90%
distribution requirement, may limit our flexibility or cause us to
forgo otherwise attractive opportunities, including certain
discretionary investments and potential financing
alternatives.
- If we fail to pay scheduled dividends on the 4.50% Mandatory
Convertible Preferred Stock, in cash, common stock or any
combination of cash and common stock, we will be prohibited from
paying dividends on our common stock, which may jeopardize our
status as a REIT.
- We have limited experience operating as a REIT. Our failure to
successfully operate as a REIT may adversely affect our financial
condition, cash flow, the per share trading price of our common
stock, or our ability to satisfy debt service obligations.
- REIT ownership limitations and transfer restrictions may
prevent or restrict certain transfers of our capital stock.
Should one or more of these or other risks or
uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those expected.
More information about potential risk factors which could affect
our results is included in our filings with the SEC. As used
in this release, the term "including," and any variation thereof,
means "including without limitation."
CROWN CASTLE INTERNATIONAL CORP. |
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED) |
(in
thousands, except share amounts) |
|
September 30, 2015 |
|
December 31, 2014 |
|
|
|
|
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
184,116 |
|
|
$ |
151,312 |
|
Restricted cash |
116,653 |
|
|
147,411 |
|
Receivables, net |
324,566 |
|
|
313,308 |
|
Prepaid expenses |
143,675 |
|
|
138,873 |
|
Deferred income tax assets |
33,110 |
|
|
24,806 |
|
Other current assets |
222,251 |
|
|
94,503 |
|
Assets from discontinued
operations |
— |
|
|
412,783 |
|
Total current assets |
1,024,371 |
|
|
1,282,996 |
|
Deferred site rental
receivables |
1,282,752 |
|
|
1,202,058 |
|
Property and equipment,
net |
9,498,568 |
|
|
8,982,783 |
|
Goodwill |
5,527,134 |
|
|
5,196,485 |
|
Other intangible
assets, net |
3,837,360 |
|
|
3,681,551 |
|
Long-term prepaid rent,
deferred financing costs and other assets, net |
825,459 |
|
|
797,403 |
|
Total assets |
$ |
21,995,644 |
|
|
$ |
21,143,276 |
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Current
liabilities: |
|
|
|
Accounts payable |
$ |
157,024 |
|
|
$ |
162,397 |
|
Accrued interest |
69,184 |
|
|
66,943 |
|
Deferred revenues |
314,648 |
|
|
279,882 |
|
Other accrued liabilities |
181,498 |
|
|
182,081 |
|
Current maturities of debt and
other obligations |
102,188 |
|
|
113,335 |
|
Liabilities from discontinued
operations |
— |
|
|
127,493 |
|
Total current liabilities |
824,542 |
|
|
932,131 |
|
Debt and other
long-term obligations |
12,039,178 |
|
|
11,807,526 |
|
Deferred income tax
liabilities |
32,317 |
|
|
39,889 |
|
Other long-term
liabilities |
1,859,304 |
|
|
1,626,502 |
|
Total liabilities |
14,755,341 |
|
|
14,406,048 |
|
Commitments and
contingencies |
|
|
|
CCIC stockholders'
equity: |
|
|
|
Common stock, $.01 par value;
600,000,000 shares authorized; shares issued and outstanding:
September 30, 2015—333,771,499 and December 31,
2014—333,856,632 |
3,339 |
|
|
3,339 |
|
4.50% Mandatory Convertible
Preferred Stock, Series A, $.01 par value; 20,000,000 shares
authorized; shares issued and outstanding: September 30, 2015 and
December 31, 2014—9,775,000; aggregate liquidation value:
September 30, 2015 and December 31, 2014—$977,500 |
98 |
|
|
98 |
|
Additional paid-in capital |
9,532,597 |
|
|
9,512,396 |
|
Accumulated other comprehensive
income (loss) |
(3,754 |
) |
|
15,820 |
|
Dividends/distributions in excess
of earnings |
(2,291,977 |
) |
|
(2,815,428 |
) |
Total CCIC stockholders'
equity |
7,240,303 |
|
|
6,716,225 |
|
Noncontrolling interest
from discontinued operations |
— |
|
|
21,003 |
|
Total equity |
7,240,303 |
|
|
6,737,228 |
|
Total liabilities and equity |
$ |
21,995,644 |
|
|
$ |
21,143,276 |
|
CROWN CASTLE INTERNATIONAL CORP. |
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED) |
(in
thousands, except share and per share amounts) |
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2015 |
|
2014 |
|
2015 |
|
2014 |
Net revenues: |
|
|
|
|
|
|
|
Site rental |
$ |
764,606 |
|
|
$ |
717,623 |
|
|
$ |
2,233,077 |
|
|
$ |
2,143,198 |
|
Network services and other |
153,501 |
|
|
175,260 |
|
|
484,938 |
|
|
469,690 |
|
Net revenues |
918,107 |
|
|
892,883 |
|
|
2,718,015 |
|
|
2,612,888 |
|
Operating
expenses: |
|
|
|
|
|
|
|
Costs of operations (exclusive of
depreciation, amortization and accretion): |
|
|
|
|
|
|
|
Site rental |
247,000 |
|
|
230,599 |
|
|
716,244 |
|
|
676,275 |
|
Network services and other |
86,859 |
|
|
101,814 |
|
|
263,177 |
|
|
275,514 |
|
General and administrative |
76,699 |
|
|
65,212 |
|
|
223,880 |
|
|
187,171 |
|
Asset write-down charges |
7,477 |
|
|
4,932 |
|
|
19,652 |
|
|
10,673 |
|
Acquisition and integration
costs |
7,608 |
|
|
4,068 |
|
|
12,001 |
|
|
28,852 |
|
Depreciation, amortization and
accretion |
261,662 |
|
|
247,206 |
|
|
766,621 |
|
|
738,965 |
|
Total operating expenses |
687,305 |
|
|
653,831 |
|
|
2,001,575 |
|
|
1,917,450 |
|
Operating income
(loss) |
230,802 |
|
|
239,052 |
|
|
716,440 |
|
|
695,438 |
|
Interest expense and
amortization of deferred financing costs |
(129,877 |
) |
|
(141,287 |
) |
|
(398,782 |
) |
|
(432,221 |
) |
Gains (losses) on
retirement of long-term obligations |
— |
|
|
— |
|
|
(4,157 |
) |
|
(44,629 |
) |
Interest income |
789 |
|
|
107 |
|
|
1,170 |
|
|
329 |
|
Other income
(expense) |
(1,214 |
) |
|
(694 |
) |
|
58,510 |
|
|
(9,350 |
) |
Income (loss) from
continuing operations before income taxes |
100,500 |
|
|
97,178 |
|
|
373,181 |
|
|
209,567 |
|
Benefit (provision) for
income taxes |
3,801 |
|
|
1,977 |
|
|
9,380 |
|
|
8,118 |
|
Income (loss) from
continuing operations |
104,301 |
|
|
99,155 |
|
|
382,561 |
|
|
217,685 |
|
Discontinued
operations: |
|
|
|
|
|
|
|
Income (loss) from discontinued
operations, net of tax |
— |
|
|
8,882 |
|
|
19,690 |
|
|
28,502 |
|
Net gain (loss) from disposal of
discontinued operations, net of tax |
(522 |
) |
|
— |
|
|
981,018 |
|
|
— |
|
Income (loss) from discontinued
operations, net of tax |
(522 |
) |
|
8,882 |
|
|
1,000,708 |
|
|
28,502 |
|
Net income (loss) |
103,779 |
|
|
108,037 |
|
|
1,383,269 |
|
|
246,187 |
|
Less: Net income (loss)
attributable to the noncontrolling interest |
— |
|
|
1,100 |
|
|
3,343 |
|
|
3,744 |
|
Net income (loss)
attributable to CCIC stockholders |
103,779 |
|
|
106,937 |
|
|
1,379,926 |
|
|
242,443 |
|
Dividends on preferred
stock |
(10,997 |
) |
|
(10,997 |
) |
|
(32,991 |
) |
|
(32,991 |
) |
Net income (loss)
attributable to CCIC common stockholders |
$ |
92,782 |
|
|
$ |
95,940 |
|
|
$ |
1,346,935 |
|
|
$ |
209,452 |
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to CCIC common stockholders, per common share: |
|
|
|
|
|
|
|
Income (loss) from continuing
operations, basic |
$ |
0.28 |
|
|
$ |
0.27 |
|
|
$ |
1.05 |
|
|
$ |
0.56 |
|
Income (loss) from discontinued
operations, basic |
$ |
— |
|
|
$ |
0.02 |
|
|
$ |
3.00 |
|
|
$ |
0.07 |
|
Net income (loss) attributable to
CCIC common stockholders, basic |
$ |
0.28 |
|
|
$ |
0.29 |
|
|
$ |
4.05 |
|
|
$ |
0.63 |
|
Income (loss) from continuing
operations, diluted |
$ |
0.28 |
|
|
$ |
0.26 |
|
|
$ |
1.05 |
|
|
$ |
0.55 |
|
Income (loss) from discontinued
operations, diluted |
$ |
— |
|
|
$ |
0.03 |
|
|
$ |
2.99 |
|
|
$ |
0.08 |
|
Net income (loss) attributable to
CCIC common stockholders, diluted |
$ |
0.28 |
|
|
$ |
0.29 |
|
|
$ |
4.04 |
|
|
$ |
0.63 |
|
|
|
|
|
|
|
|
|
Weighted-average common
shares outstanding (in thousands): |
|
|
|
|
|
|
|
Basic |
333,049 |
|
|
332,413 |
|
|
332,951 |
|
|
332,264 |
|
Diluted |
333,711 |
|
|
333,241 |
|
|
333,735 |
|
|
333,020 |
|
CROWN CASTLE INTERNATIONAL CORP. |
|
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED) |
|
(in
thousands) |
|
|
|
|
Nine Months Ended September 30, |
|
|
2015 |
|
2014 |
|
Cash flows from
operating activities: |
|
|
|
|
Net income (loss) from continuing operations |
$ |
382,561 |
|
|
$ |
217,685 |
|
|
Adjustments to
reconcile net income (loss) from continuing operations to net cash
provided by (used for) operating activities: |
|
|
|
|
Depreciation, amortization and
accretion |
766,621 |
|
|
738,965 |
|
|
Gains (losses) on retirement of
long-term obligations |
4,157 |
|
|
44,629 |
|
|
Gains (losses) on settled
swaps |
(54,475 |
) |
|
— |
|
|
Amortization of deferred financing
costs and other non-cash interest |
32,394 |
|
|
61,322 |
|
|
Stock-based compensation
expense |
44,711 |
|
|
39,497 |
|
|
Asset write-down charges |
19,652 |
|
|
10,673 |
|
|
Deferred income tax benefit
(provision) |
(16,199 |
) |
|
(14,589 |
) |
|
Other non-cash adjustments,
net |
(7,240 |
) |
|
(1,967 |
) |
|
Changes in assets and liabilities,
excluding the effects of acquisitions: |
|
|
|
|
Increase (decrease) in
liabilities |
208,538 |
|
|
289,676 |
|
|
Decrease (increase) in assets |
(89,844 |
) |
|
(234,965 |
) |
|
Net cash provided by (used for)
operating activities |
1,290,876 |
|
|
1,150,926 |
|
|
Cash flows from
investing activities: |
|
|
|
|
Payments for acquisition of
businesses, net of cash acquired |
(1,083,319 |
) |
|
(174,356 |
) |
|
Capital expenditures |
(658,240 |
) |
|
(498,960 |
) |
|
Receipts from foreign currency
swaps |
54,475 |
|
|
— |
|
|
Other investing activities,
net |
(1,561 |
) |
|
2,787 |
|
|
Net cash provided by (used for)
investing activities |
(1,688,645 |
) |
|
(670,529 |
) |
|
Cash flows from
financing activities: |
|
|
|
|
Proceeds from issuance of long-term
debt |
1,000,000 |
|
|
845,750 |
|
|
Principal payments on debt and
other long-term obligations |
(78,049 |
) |
|
(86,197 |
) |
|
Purchases and redemptions of
long-term debt |
(1,069,337 |
) |
|
(836,899 |
) |
|
Purchases of capital stock |
(29,576 |
) |
|
(21,778 |
) |
|
Borrowings under revolving credit
facility |
1,560,000 |
|
|
567,000 |
|
|
Payments under revolving credit
facility |
(1,240,000 |
) |
|
(587,000 |
) |
|
Payments for financing costs |
(17,415 |
) |
|
(15,899 |
) |
|
Net decrease (increase) in
restricted cash |
28,435 |
|
|
39,882 |
|
|
Dividends/distributions paid on
common stock |
(821,056 |
) |
|
(350,535 |
) |
|
Dividends paid on preferred
stock |
(32,991 |
) |
|
(33,357 |
) |
|
Net cash provided by (used for)
financing activities |
(699,989 |
) |
|
(479,033 |
) |
|
Net increase
(decrease) in cash and cash equivalents - continuing
operations |
(1,097,758 |
) |
|
1,364 |
|
|
Discontinued
operations: |
|
|
|
|
Net cash provided by (used for)
operating activities |
4,359 |
|
|
41,304 |
|
|
Net cash provided by (used for)
investing activities |
1,103,577 |
|
|
(20,154 |
) |
|
Net increase
(decrease) in cash and cash equivalents - discontinued
operations |
1,107,936 |
|
|
21,150 |
|
|
Effect of
exchange rate changes |
(1,682 |
) |
|
(7,358 |
) |
|
Cash and cash equivalents at beginning of
period |
175,620 |
|
(a) |
223,394 |
|
(a) |
Cash and cash
equivalents at end of period |
$ |
184,116 |
|
|
$ |
238,550 |
|
(a) |
Supplemental
disclosure of cash flow information: |
|
|
|
|
Interest paid |
364,147 |
|
|
368,437 |
|
|
Income taxes paid |
23,865 |
|
|
15,353 |
|
|
________________
(a) Inclusive of cash and cash equivalents included in
discontinued operations.
Contacts: Jay Brown, CFOSon Nguyen, VP - Corporate FinanceCrown
Castle International Corp.713-570-3050
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