Crown Castle International Corp. (NYSE:CCI) ("Crown Castle") today
reported results for the quarter ended September 30, 2016.
"Our business continues to grow at a healthy
pace as U.S. wireless carriers further invest to enhance the
consumer mobile experience," stated Jay Brown, Crown Castle’s Chief
Executive Officer. "Driven by the continued adoption and
introduction of data-intensive applications and consistent with
many industry forecasts, we believe over the next decade there will
be tremendous growth in wireless data traffic that will necessitate
further investment in wireless networks, which we expect will
result in revenue and cash flow growth for Crown Castle.
Today, as a result of our investments over the last several years
to acquire towers and deploy small cells, we have the leading
portfolio of U.S. wireless infrastructure, which we expect will
continue to generate significant incremental returns.
Consistent with the growth we are seeing in our business, we are
increasing our quarterly stock dividend by 7% to $0.95 per share,
commencing with our fourth quarter 2016 dividend
payment."
RESULTS FOR THE QUARTERThe table below sets forth
select financial results for the three month period ended
September 30, 2016. For further information, refer to
the financial statements and non-GAAP and other calculation
reconciliations included in this press release.
(in millions) |
Actual |
Midpoint Q3 2016 Outlook(b) |
Actual Compared to Outlook |
Q3 2016 |
Q3 2015 |
$ Change |
% Change |
Site rental revenues |
$ |
|
812 |
|
$ |
765 |
|
+$ |
47 |
|
|
6 |
% |
$ |
808 |
|
+$ |
4 |
|
Site rental gross margin |
$ |
|
555 |
|
$ |
518 |
|
+$ |
37 |
|
|
7 |
% |
$ |
552 |
|
+$ |
3 |
|
Net income (loss) |
$ |
|
98 |
|
$ |
104 |
|
-$ |
6 |
|
|
-6 |
% |
$ |
101 |
|
-$ |
3 |
|
Adjusted EBITDA(a) |
$ |
|
564 |
|
$ |
529 |
|
+$ |
35 |
|
|
7 |
% |
$ |
560 |
|
+$ |
4 |
|
AFFO(a)(c) |
$ |
|
416 |
|
$ |
356 |
|
+$ |
60 |
|
|
17 |
% |
$ |
403 |
|
+$ |
13 |
|
Weighted-average common shares outstanding -
diluted |
|
|
338 |
|
|
334 |
|
+ |
4 |
|
|
1 |
% |
|
339 |
|
- |
1 |
|
Note: Figures may not tie due to
rounding |
(a) See reconciliation of this
non-GAAP financial measure to net income (loss) included
herein. |
(b) As issued on July 21,
2016. |
(c) Attributable to CCIC common
stockholders. |
HIGHLIGHTS FROM THE QUARTER
- Site rental revenues. Site rental
revenues grew approximately 6%, or $47 million, from third quarter
2015 to third quarter 2016, inclusive of approximately $47 million
in Organic Contribution to Site Rental Revenues plus $19 million in
contributions from acquisitions and other items, less a $19 million
reduction in straight-line revenues. The $47 million in
Organic Contribution to Site Rental Revenues represents
approximately 6% growth, comprised of approximately 9% growth from
new leasing activity and contracted tenant escalations, net of
approximately 3% from tenant non-renewals.
- Net income (loss). Net income (loss) for
third quarter 2016 was negatively impacted by approximately $10
million in losses on retirement of long-term obligations related to
refinancing activities during the quarter.
- AFFO. AFFO for third quarter 2016
benefited from approximately $7 million in lower than expected
sustaining capital expenditures during the quarter. This
benefit is primarily attributable to timing, as the unspent amount
from third quarter 2016 is expected to be spent during fourth
quarter 2016.
- Capital expenditures. Capital expenditures
during the quarter were approximately $221 million, comprised of
approximately $17 million of land purchases, approximately $19
million of sustaining capital expenditures and approximately $185
million of revenue generating capital expenditures.
- Common stock dividend. During the
quarter, Crown Castle paid common stock dividends of approximately
$299 million in the aggregate, or $0.885 per common share.
- Financing activities. During the
quarter, Crown Castle issued $700 million in aggregate principal
amount of senior unsecured notes, the proceeds of which were used
to refinance existing debt.
"Our excellent third quarter results allowed us
to increase our full year 2016 Outlook, setting the stage for
expected continued growth in 2017," stated Dan Schlanger, Crown
Castle's Chief Financial Officer. "We expect the healthy
leasing environment from 2016 to continue into 2017 as the wireless
carriers continue to upgrade and enhance their networks to meet
increasing demand for wireless connectivity. This leasing
backdrop combined with the strength of our business model, the
quality of our assets and the strength of our balance sheet give us
the confidence to increase our dividend and provide us with
opportunities to continue to invest in our business to drive
long-term growth in AFFO and dividends."
DIVIDEND INCREASE
ANNOUNCEMENTCrown Castle's Board of Directors has declared
a quarterly cash dividend of $0.95 per common share, representing
an increase of approximately 7% over the previous quarterly
dividend of $0.885 per share. The quarterly dividend will be
payable on December 30, 2016 to common stockholders of record at
the close of business on December 16, 2016. Future dividends are
subject to the approval of Crown Castle's Board of Directors.
OUTLOOKThis 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
SEC.The following table sets forth Crown Castle's current Outlook
for fourth quarter 2016, full year 2016 and full year
2017:
(in millions) |
Fourth Quarter 2016 |
Full Year 2016 |
Full Year 2017 |
Site
rental revenues |
$ |
811 |
|
to |
$ |
816 |
|
$ |
3,227 |
|
to |
$ |
3,232 |
|
$ |
3,314 |
|
to |
$ |
3,344 |
|
Site
rental cost of operations |
$ |
253 |
|
to |
$ |
258 |
|
$ |
1,015 |
|
to |
$ |
1,020 |
|
$ |
1,023 |
|
to |
$ |
1,053 |
|
Site
rental gross margin |
$ |
556 |
|
to |
$ |
561 |
|
$ |
2,210 |
|
to |
$ |
2,215 |
|
$ |
2,276 |
|
to |
$ |
2,306 |
|
Net
income (loss) |
$ |
90 |
|
to |
$ |
110 |
|
$ |
318 |
|
to |
$ |
338 |
|
$ |
375 |
|
to |
$ |
425 |
|
Adjusted EBITDA(a) |
$ |
566 |
|
to |
$ |
571 |
|
$ |
2,219 |
|
to |
$ |
2,224 |
|
$ |
2,263 |
|
to |
$ |
2,293 |
|
Interest expense and
amortization of deferred financing costs(b) |
$ |
128 |
|
to |
$ |
133 |
|
$ |
514 |
|
to |
$ |
519 |
|
$ |
515 |
|
to |
$ |
545 |
|
FFO(a)(d) |
$ |
383 |
|
to |
$ |
388 |
|
$ |
1,426 |
|
to |
$ |
1,431 |
|
$ |
1,566 |
|
to |
$ |
1,596 |
|
AFFO(a)(d) |
$ |
403 |
|
to |
$ |
408 |
|
$ |
1,606 |
|
to |
$ |
1,611 |
|
$ |
1,739 |
|
to |
$ |
1,769 |
|
Weighted-average common
shares outstanding - diluted(c) |
|
346 |
|
|
340 |
|
|
350 |
|
|
|
|
|
|
|
|
|
|
|
(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) The assumption for fourth quarter 2016, full year 2016 and
full year 2017 diluted weighted-average common shares outstanding
is based on (1) diluted common shares outstanding as of September
30, 2016 and (2) the assumed conversion of the mandatory
convertible preferred stock in November 2016. |
(d) Attributable to CCIC common stockholders. |
Full Year 2016 Outlook The table below compares
the results for full year 2015, the midpoint of the current full
year 2016 Outlook and the midpoint of the previously provided full
year 2016 Outlook for select metrics.
|
Midpoint of FY 2016 Outlook to FY 2015 Actual
Comparison |
Previous Full Year 2016 Outlook(b) |
Current Compared to Previous Outlook |
($ in
millions) |
Current Full Year2016 Outlook |
Full Year 2015 Actual |
$ Change |
% Change |
Site rental revenues |
$ |
3,230 |
|
$ |
3,018 |
|
+$ |
212 |
|
|
+7 |
% |
$ |
3,223 |
|
+$ |
7 |
|
Site rental gross margin |
$ |
2,213 |
|
$ |
2,055 |
|
+$ |
158 |
|
|
+8 |
% |
$ |
2,207 |
|
+$ |
6 |
|
Net income (loss) |
$ |
328 |
|
$ |
1,524 |
|
-$ |
1,196 |
|
|
-78 |
% |
$ |
338 |
|
-$ |
10 |
|
Adjusted EBITDA(a) |
$ |
2,222 |
|
$ |
2,119 |
|
+$ |
103 |
|
|
+5 |
% |
$ |
2,215 |
|
+$ |
7 |
|
AFFO(a)(d) |
$ |
1,609 |
|
$ |
1,437 |
|
+$ |
172 |
|
|
+12 |
% |
$ |
1,605 |
|
+$ |
4 |
|
Weighted-average common shares outstanding -
diluted(c) |
|
340 |
|
|
334 |
|
+ |
6 |
|
|
+2 |
% |
|
341 |
|
- |
1 |
|
|
(a) See reconciliation of this
non-GAAP financial measure to net income (loss) included
herein. |
(b) As issued on July 21,
2016. Represents midpoint of Outlook. |
(c) The assumption for full
year 2016 diluted weighted-average common shares outstanding is
based on (1) diluted common shares outstanding as of September 30,
2016 and (2) the assumed conversion of the mandatory convertible
preferred stock in November 2016. |
(d) Attributable to CCIC common
stockholders. |
- The increase in full year 2016 Outlook primarily reflects the
higher than expected results from the third quarter and the
expected timing benefit from tenant non-renewals occurring later
than previously expected, partially offset by an expected increase
in sustaining capital expenditures for the full year.
Full Year 2017 Outlook The table below compares
the midpoint of the current full year 2016 Outlook and the midpoint
of the full year 2017 Outlook for select metrics:
|
Midpoint |
|
|
($ in
millions) |
Full Year2016 Outlook |
Full Year 2017 Outlook |
$ Change |
% Change |
Site rental revenues |
$ |
3,230 |
|
$ |
3,329 |
|
+$ |
99 |
|
|
+3 |
% |
Site rental gross margin |
$ |
2,213 |
|
$ |
2,291 |
|
+$ |
78 |
|
|
+4 |
% |
Net income (loss) |
$ |
328 |
|
$ |
400 |
|
+$ |
72 |
|
|
+22 |
% |
Adjusted EBITDA(a) |
$ |
2,222 |
|
$ |
2,278 |
|
+$ |
56 |
|
|
+3 |
% |
AFFO(a)(c) |
$ |
1,609 |
|
$ |
1,754 |
|
+$ |
145 |
|
|
+9 |
% |
Weighted-average common shares outstanding -
diluted(b) |
|
340 |
|
|
350 |
|
+ |
10 |
|
|
+3 |
% |
|
(a) See reconciliation of this
non-GAAP financial measure to net income (loss) included
herein. |
(b) The assumption for full
year 2016 and 2017 diluted weighted-average common shares
outstanding is based on (1) diluted common shares outstanding as of
September 30, 2016 and (2) the assumed conversion of the mandatory
convertible preferred stock in November 2016. |
(c) Attributable to CCIC common
stockholders. |
- The chart below reconciles the components of expected growth
from 2016 to 2017 in site rental revenues of $85 million to $115
million, including expected Organic Contribution to Site Rental
Revenues of approximately $140 million to $170 million.
An infographic accompanying this announcement is available
at http://www.globenewswire.com/NewsRoom/AttachmentNg/34f28cca-3c9c-49b9-bfec-567ddf46f869
- At the midpoint, growth from new leasing activity for full year
2017 is approximately $10 million lower than full year 2016. This
lower growth reflects similar growth from towers and approximately
$15 million higher growth from small cells, offset by approximately
$25 million in lower growth from amortization of deferred credits
(commonly referred to as prepaid rent). Further, full year 2017
Outlook assumes prepaid rent to be received during the year to be
similar to full year 2016.
- The chart below reconciles the components of expected growth in
AFFO from 2016 to 2017 of approximately $145 million at the
midpoint.
An infographic accompanying this announcement is available
at http://www.globenewswire.com/NewsRoom/AttachmentNg/9c5c9a31-2760-496d-bfe0-f624bad7f7ac
- Network services gross margin contribution for full year 2017
is expected to be approximately $235 million to $255 million
compared to full year 2016 expectation of $255 million to $260
million.
- The conversion of the 4.5% Mandatory Convertible Preferred
Stock ("Preferred Stock") on November 1, 2016 will eliminate $44
million in annual preferred dividend payments, which are deducted
to arrive at AFFO. As a result of the anticipated conversion
of the Preferred Stock, 11.6 million common shares are expected to
be issued on November 1, 2016. The amount of common shares to
be issued is subject to change depending on the average common
share price for the 20 business days preceding November 1,
2016.
- Additional information is available in Crown Castle's quarterly
Supplemental Information Package posted in the Investors section of
its website.
CONFERENCE CALL DETAILSCrown
Castle has scheduled a conference call for Friday, October 21,
2016, at 10:30 a.m. Eastern time. The conference call may be
accessed by dialing 888-811-5441 and asking for the Crown Castle
call (access code 6156887) 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
Friday, October 21, 2016, through 1:30 p.m. Eastern time on
Thursday, January 19, 2017 and may be accessed by dialing
888-203-1112 and using access code 6156887. 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 CASTLECrown Castle
provides wireless carriers with the infrastructure they need to
keep people connected and businesses running. With approximately
40,000 towers and 17,000 miles of fiber supporting small cells,
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, Adjusted Funds from Operations ("AFFO"), Funds
from Operations ("FFO"), and Organic Contribution to Site Rental
Revenues, 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")).
Our measures of Adjusted EBITDA, AFFO, FFO,
Organic Contribution to Site Rental Revenues, Segment Site Rental
Gross Margin, Segment Network Services and Other Gross Margin and
Segment Operating Profit may not be comparable to similarly titled
measures of other companies, including other companies in the tower
sector or other REITs. Our definition of FFO is consistent
with guidelines from the National Association of Real Estate
Investment Trusts with the exception of the impact of income taxes
in periods prior to our REIT conversion.
Adjusted EBITDA, AFFO, FFO, and Organic
Contribution to Site Rental Revenues are presented as additional
information because management believes these measures are useful
indicators of the financial performance of our business.
Among other things, management believes that:
• Adjusted EBITDA is useful to investors or other interested
parties in evaluating our financial performance. Adjusted
EBITDA is the primary measure used by management (1) to evaluate
the economic productivity of our operations and (2) for purposes of
making decisions about allocating resources to, and assessing the
performance of, our operations. Management believes that
Adjusted EBITDA helps investors or other interested parties
meaningfully evaluate and compare the results of our operations (1)
from period to period and (2) to our competitors, by excluding the
impact of our capital structure (primarily interest charges from
our outstanding debt) and asset base (primarily depreciation,
amortization and accretion) from our financial results.
Management also believes Adjusted EBITDA is frequently used by
investors or other interested parties in the evaluation of
REITs. In addition, Adjusted EBITDA is similar to the measure
of current financial performance generally used in our debt
covenant calculations. Adjusted EBITDA should be considered
only as a supplement to net income computed in accordance with GAAP
as a measure of our performance.
•AFFO is useful to investors or other interested parties in
evaluating our financial performance. Management believes
that AFFO helps investors or other interested parties meaningfully
evaluate our financial performance as they include (1) the impact
of our capital structure (primarily interest expense on our
outstanding debt and dividends on our preferred stock) and (2)
sustaining capital expenditures, and exclude the impact of our (1)
asset base (primarily depreciation, amortization and accretion) and
(2) certain non-cash items, including straight-lined revenues and
expenses related to fixed escalations and rent free periods.
GAAP requires rental revenues and expenses related to leases that
contain specified rental increases over the life of the lease to be
recognized evenly over the life of the lease. In accordance
with GAAP, if payment terms call for fixed escalations, or rent
free periods, the revenue or expense is recognized on a
straight-lined basis over the fixed, non-cancelable term of the
contract. Management notes that the Company uses AFFO only as
a performance measure. AFFO should be considered only as a
supplement to net income computed in accordance with GAAP as a
measure of our performance and should not be considered as an
alternative to cash flows from operations or as residual cash flow
available for discretionary investment.
•FFO is useful to investors or other interested parties in
evaluating our financial performance. Management believes
that FFO may be used by investors or other interested parties as a
basis to compare our financial performance with that of other
REITs. FFO helps investors or other interested parties
meaningfully evaluate financial performance by excluding the impact
of our asset base (primarily depreciation, amortization and
accretion). FFO is not a key performance indicator used by the
Company. FFO should be considered only as a supplement to net
income computed in accordance with GAAP as a measure of our
performance and should not be considered as an alternative to cash
flow from operations.
•Organic Contribution to Site Rental Revenues is useful to
investors or other interested parties in understanding the
components of the year-over year changes in our site rental
revenues computed in accordance with GAAP. Management uses
the Organic Contribution to Site Rental Revenues to assess
year-over-year growth rates for our rental activities, to evaluate
current performance, to capture trends in rental rates, new leasing
activities and customer non-renewals in our core business, as well
to forecast future results. Organic Contribution to Site Rental
Revenues is not meant as an alternative measure of revenue and
should be considered only as a supplement in understanding and
assessing the performance of our site rental revenues computed in
accordance with GAAP.
In addition to the non-GAAP financial measures
used herein, we also provide Segment Site Rental Gross Margin,
Segment Network Services and Other Gross Margin and Segment
Operating Profit, which are key measures used by management to
evaluate our operating segments for purposes of making decisions
about allocating capital and assessing performance. These
segment measures are provided pursuant to GAAP requirements related
to segment reporting. In addition, we provide the components
of certain GAAP measures, such as capital expenditures.
We define our non-GAAP financial measures and
other measures as follows:
Adjusted EBITDA. We define 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.
Adjusted Funds from Operations. We define
Adjusted Funds from Operations as FFO before straight-lined
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.
Funds from Operations. We define 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.
Organic Contribution to Site Rental Revenues. We
define the Organic Contribution to Site Rental Revenues as the sum
of the change in GAAP site rental revenues related to (1) new
leasing activity including revenues from the construction of small
cells and the impact of prepaid rent, (2) escalators and less (3)
non-renewals of customer contracts.
Discretionary capital expenditures. We
define discretionary capital expenditures as those capital
expenditures made with respect to activities which we believe
exhibit sufficient potential to enhance long-term stockholder
value. They consist of (1) improvements to existing wireless
infrastructure and construction of new wireless infrastructure
(collectively referred to as "revenue generating") and (2)
purchases of land assets under towers as we seek to manage our
interests in the land beneath our towers.
Sustaining capital expenditures. We define
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.
Segment Site Rental Gross Margin. We
define Segment Site Rental Gross Margin as segment site rental
revenues less segment site rental cost of operations, excluding
stock-based compensation expense and prepaid lease purchase price
adjustments recorded in cost of operations.
Segment Network Services and Other Gross
Margin. We define Segment Network Services and Other Gross
Margin as segment network services and other revenues less segment
network services and other cost of operations, excluding
stock-based compensation expense recorded in cost of
operations.
Segment Operating Profit. We define
Segment Operating Profit as segment revenues less segment cost of
operations and segment general and administrative expenses,
excluding stock-based compensation expense and prepaid lease
purchase price adjustments recorded in cost of operations.
The tables set forth below reconcile the
non-GAAP financial measures used herein 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:
Reconciliation of Historical Adjusted
EBITDA:
|
For the Three Months Ended |
|
For the Twelve Months Ended |
|
September 30, 2016 |
|
September 30, 2015 |
|
December 31, 2015 |
(in millions) |
|
|
|
|
|
Net income (loss) |
$ |
98.4 |
|
|
$ |
103.8 |
|
|
$ |
1,524.3 |
|
Adjustments to increase
(decrease) net income (loss): |
|
|
|
|
|
Income (loss) from discontinued
operations |
— |
|
|
0.5 |
|
|
(999.0 |
) |
Asset write-down charges |
8.3 |
|
|
7.5 |
|
|
33.5 |
|
Acquisition and integration
costs |
2.7 |
|
|
7.6 |
|
|
15.7 |
|
Depreciation, amortization and
accretion |
280.8 |
|
|
261.7 |
|
|
1,036.2 |
|
Amortization of prepaid lease
purchase price adjustments |
5.4 |
|
|
5.1 |
|
|
20.5 |
|
Interest expense and amortization
of deferred financing costs(a) |
129.9 |
|
|
129.9 |
|
|
527.1 |
|
Gains (losses) on retirement of
long-term obligations |
10.3 |
|
|
— |
|
|
4.2 |
|
Interest income |
(0.2 |
) |
|
(0.8 |
) |
|
(1.9 |
) |
Other income (expense) |
0.8 |
|
|
1.2 |
|
|
(57.0 |
) |
Benefit (provision) for income
taxes |
5.0 |
|
|
(3.8 |
) |
|
(51.5 |
) |
Stock-based compensation
expense |
22.6 |
|
|
16.5 |
|
|
67.1 |
|
Adjusted
EBITDA(b) |
$ |
564.1 |
|
|
$ |
529.2 |
|
|
$ |
2,119.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(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. |
Reconciliation of Current Outlook for Adjusted
EBITDA:
|
Q4 2016 |
|
Full Year 2016 |
|
Full Year 2017 |
(in
millions) |
Outlook |
|
Outlook |
|
Outlook |
Net income (loss) |
$ |
90 |
|
to |
$ |
110 |
|
|
$ |
318 |
|
to |
$ |
338 |
|
|
$ |
375 |
|
to |
$ |
425 |
|
Adjustments to increase
(decrease) net income (loss): |
|
|
|
|
|
|
|
|
|
|
|
Asset write-down charges |
$ |
9 |
|
to |
$ |
11 |
|
|
$ |
37 |
|
to |
$ |
39 |
|
|
$ |
35 |
|
to |
$ |
45 |
|
Acquisition and integration
costs |
$ |
3 |
|
to |
$ |
6 |
|
|
$ |
14 |
|
to |
$ |
17 |
|
|
$ |
3 |
|
to |
$ |
8 |
|
Depreciation, amortization and
accretion |
$ |
283 |
|
to |
$ |
298 |
|
|
$ |
1,123 |
|
to |
$ |
1,138 |
|
|
$ |
1,151 |
|
to |
$ |
1,177 |
|
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) |
$ |
128 |
|
to |
$ |
133 |
|
|
$ |
514 |
|
to |
$ |
519 |
|
|
$ |
515 |
|
to |
$ |
545 |
|
Gains (losses) on retirement of
long-term obligations |
$ |
0 |
|
to |
$ |
0 |
|
|
$ |
52 |
|
to |
$ |
52 |
|
|
$ |
0 |
|
to |
$ |
0 |
|
Interest income |
$ |
(1 |
) |
to |
$ |
0 |
|
|
$ |
(2 |
) |
to |
$ |
(1 |
) |
|
$ |
(1 |
) |
to |
$ |
1 |
|
Other income (expense) |
$ |
(1 |
) |
to |
$ |
2 |
|
|
$ |
3 |
|
to |
$ |
6 |
|
|
$ |
2 |
|
to |
$ |
4 |
|
Benefit (provision) for income
taxes |
$ |
4 |
|
to |
$ |
8 |
|
|
$ |
18 |
|
to |
$ |
22 |
|
|
$ |
14 |
|
to |
$ |
22 |
|
Stock-based compensation
expense |
$ |
21 |
|
to |
$ |
23 |
|
|
$ |
97 |
|
to |
$ |
99 |
|
|
$ |
94 |
|
to |
$ |
99 |
|
Adjusted
EBITDA(b) |
$ |
566 |
|
to |
$ |
571 |
|
|
$ |
2,219 |
|
to |
$ |
2,224 |
|
|
$ |
2,263 |
|
to |
$ |
2,293 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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. |
Reconciliation of Historical FFO and
AFFO:
|
For the Three Months Ended |
|
For the Nine Months Ended |
|
For the Twelve Months Ended |
(in millions) |
September 30, 2016 |
|
September 30, 2015 |
|
September 30, 2016 |
|
September 30, 2015 |
|
December 31, 2015 |
Net income
(loss)(a) |
$ |
98.4 |
|
|
$ |
104.3 |
|
|
$ |
232.3 |
|
|
$ |
382.6 |
|
|
$ |
525.3 |
|
Real estate related
depreciation, amortization and accretion |
274.2 |
|
|
257.0 |
|
|
815.1 |
|
|
753.6 |
|
|
1,018.3 |
|
Asset write-down
charges |
8.3 |
|
|
7.5 |
|
|
28.3 |
|
|
19.7 |
|
|
33.5 |
|
Dividends on preferred
stock |
(11.0 |
) |
|
(11.0 |
) |
|
(33.0 |
) |
|
(33.0 |
) |
|
(44.0 |
) |
FFO(b)(c)(d)(e)(f) |
$ |
369.9 |
|
|
$ |
357.8 |
|
|
$ |
1,042.6 |
|
|
$ |
1,122.8 |
|
|
$ |
1,533.1 |
|
|
|
|
|
|
|
|
|
|
|
FFO (from above) |
$ |
369.9 |
|
|
$ |
357.8 |
|
|
$ |
1,042.6 |
|
|
$ |
1,122.8 |
|
|
$ |
1,533.1 |
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
|
|
Straight-lined revenue |
(8.8 |
) |
|
(27.1 |
) |
|
(42.4 |
) |
|
(89.0 |
) |
|
(111.3 |
) |
Straight-lined expense |
23.5 |
|
|
24.4 |
|
|
71.1 |
|
|
74.0 |
|
|
98.7 |
|
Stock-based compensation
expense |
22.6 |
|
|
16.5 |
|
|
75.3 |
|
|
49.3 |
|
|
67.1 |
|
Non-cash portion of tax
provision |
3.5 |
|
|
(5.9 |
) |
|
5.2 |
|
|
(20.3 |
) |
|
(63.9 |
) |
Non-real estate related
depreciation, amortization and accretion |
6.6 |
|
|
4.6 |
|
|
19.6 |
|
|
13.0 |
|
|
17.9 |
|
Amortization of non-cash interest
expense |
3.3 |
|
|
8.6 |
|
|
11.3 |
|
|
32.4 |
|
|
37.1 |
|
Other (income) expense |
0.8 |
|
|
1.2 |
|
|
4.6 |
|
|
(58.5 |
) |
|
(57.0 |
) |
Gains (losses) on retirement of
long-term obligations |
10.3 |
|
|
— |
|
|
52.3 |
|
|
4.2 |
|
|
4.2 |
|
Acquisition and integration
costs |
2.7 |
|
|
7.6 |
|
|
11.5 |
|
|
12.0 |
|
|
15.7 |
|
Capital improvement capital
expenditures |
(10.0 |
) |
|
(14.4 |
) |
|
(25.4 |
) |
|
(32.5 |
) |
|
(46.8 |
) |
Corporate capital expenditures |
(8.5 |
) |
|
(17.0 |
) |
|
(22.4 |
) |
|
(42.9 |
) |
|
(58.1 |
) |
AFFO(b)(c)(d)(e)(f) |
$ |
415.8 |
|
|
$ |
356.4 |
|
|
$ |
1,203.5 |
|
|
$ |
1,064.4 |
|
|
$ |
1,436.6 |
|
|
(a) Exclusive of income (loss)
from discontinued operations and related noncontrolling interest of
$(0.5 million), $1.0 billion and $1.0 billion for the three months
ended September 30, 2015, nine months ended September 30, 2015 and
twelve months ended December 31, 2015, 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) Diluted weighted-average
common shares outstanding were 338.4 million, 333.7 million, 337.1
million, 333.7 million and 334.1 million for the three months ended
September 30, 2016 and 2015, the nine months ended September 30,
2016 and 2015 and the twelve months ended December 31, 2015.
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. |
(f) Attributable to CCIC common
stockholders. |
Reconciliation of Current Outlook for
FFO and AFFO:
|
Q4 2016 |
|
Full Year 2016 |
|
Full Year 2017 |
(in millions) |
Outlook |
|
Outlook |
|
Outlook |
Net income (loss) |
$ |
90 |
|
to |
$ |
110 |
|
|
$ |
318 |
|
to |
$ |
338 |
|
|
$ |
375 |
|
to |
$ |
425 |
|
Real estate related
depreciation, amortization and accretion |
$ |
277 |
|
to |
$ |
290 |
|
|
$ |
1,097 |
|
to |
$ |
1,110 |
|
|
$ |
1,127 |
|
to |
$ |
1,148 |
|
Asset write-down
charges |
$ |
9 |
|
to |
$ |
11 |
|
|
$ |
37 |
|
to |
$ |
39 |
|
|
$ |
35 |
|
to |
$ |
45 |
|
Dividends on preferred
stock |
$ |
(11 |
) |
to |
$ |
(11 |
) |
|
$ |
(44 |
) |
to |
$ |
(44 |
) |
|
$ |
0 |
|
to |
$ |
0 |
|
FFO(a)(b)(c)(d)(e) |
$ |
383 |
|
to |
$ |
388 |
|
|
$ |
1,426 |
|
to |
$ |
1,431 |
|
|
$ |
1,566 |
|
to |
$ |
1,596 |
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO (from above) |
$ |
383 |
|
to |
$ |
388 |
|
|
$ |
1,426 |
|
to |
$ |
1,431 |
|
|
$ |
1,566 |
|
to |
$ |
1,596 |
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
|
|
|
|
Straight-lined revenue |
$ |
(8 |
) |
to |
$ |
(3 |
) |
|
$ |
(50 |
) |
to |
$ |
(45 |
) |
|
$ |
13 |
|
to |
$ |
28 |
|
Straight-lined expense |
$ |
20 |
|
to |
$ |
25 |
|
|
$ |
90 |
|
to |
$ |
95 |
|
|
$ |
78 |
|
to |
$ |
93 |
|
Stock-based compensation
expense |
$ |
21 |
|
to |
$ |
23 |
|
|
$ |
97 |
|
to |
$ |
99 |
|
|
$ |
94 |
|
to |
$ |
99 |
|
Non-cash portion of tax
provision |
$ |
2 |
|
to |
$ |
7 |
|
|
$ |
9 |
|
to |
$ |
14 |
|
|
$ |
(3 |
) |
to |
$ |
12 |
|
Non-real estate related
depreciation, amortization and accretion |
$ |
6 |
|
to |
$ |
8 |
|
|
$ |
26 |
|
to |
$ |
28 |
|
|
$ |
24 |
|
to |
$ |
29 |
|
Amortization of non-cash interest
expense |
$ |
3 |
|
to |
$ |
6 |
|
|
$ |
12 |
|
to |
$ |
15 |
|
|
$ |
11 |
|
to |
$ |
17 |
|
Other (income) expense |
$ |
(1 |
) |
to |
$ |
2 |
|
|
$ |
3 |
|
to |
$ |
6 |
|
|
$ |
2 |
|
to |
$ |
4 |
|
Gains (losses) on retirement of
long-term obligations |
$ |
0 |
|
to |
$ |
0 |
|
|
$ |
52 |
|
to |
$ |
52 |
|
|
$ |
0 |
|
to |
$ |
0 |
|
Acquisition and integration
costs |
$ |
3 |
|
to |
$ |
6 |
|
|
$ |
14 |
|
to |
$ |
17 |
|
|
$ |
3 |
|
to |
$ |
8 |
|
Capital improvement capital
expenditures |
$ |
(20 |
) |
to |
$ |
(15 |
) |
|
$ |
(46 |
) |
to |
$ |
(41 |
) |
|
$ |
(45 |
) |
to |
$ |
(40 |
) |
Corporate capital expenditures |
$ |
(20 |
) |
to |
$ |
(15 |
) |
|
$ |
(43 |
) |
to |
$ |
(38 |
) |
|
$ |
(37 |
) |
to |
$ |
(32 |
) |
AFFO(a)(b)(c)(d)(e) |
$ |
403 |
|
to |
$ |
408 |
|
|
$ |
1,606 |
|
to |
$ |
1,611 |
|
|
$ |
1,739 |
|
to |
$ |
1,769 |
|
|
(a) The assumption for fourth
quarter 2016, full year 2016 and full year 2017 diluted
weighted-average common shares outstanding is 346 million, 340
million and 350 million, respectively, based on (1) diluted common
shares outstanding as of September 30, 2016 and (2) the assumed
conversion of the mandatory convertible preferred stock in November
2016. |
(b) See "Non-GAAP Financial Measures
and Other Calculations" herein for a discussion for our definitions
of FFO and AFFO. |
(c) FFO and AFFO are reduced by cash
paid for preferred stock dividends. |
(d) The above reconciliation
excludes line items included in our definition which are not
applicable for the periods shown. |
(e) Attributable to CCIC common
stockholders. |
For Comparative Purposes -
Reconciliation of Previous Outlook for Adjusted
EBITDA:
|
Previously Issued |
|
Previously Issued |
|
Q3 2016 |
|
Full Year 2016 |
(in
millions) |
Outlook |
|
Outlook |
Net income (loss) |
$ |
91 |
|
to |
$ |
111 |
|
|
$ |
318 |
|
to |
$ |
358 |
|
Adjustments to increase
(decrease) net income (loss): |
|
|
|
|
|
|
|
Asset write-down charges |
$ |
9 |
|
to |
$ |
11 |
|
|
$ |
35 |
|
to |
$ |
45 |
|
Acquisition and integration
costs |
$ |
3 |
|
to |
$ |
6 |
|
|
$ |
14 |
|
to |
$ |
19 |
|
Depreciation, amortization and
accretion |
$ |
275 |
|
to |
$ |
290 |
|
|
$ |
1,107 |
|
to |
$ |
1,133 |
|
Amortization of prepaid lease
purchase price adjustments |
$ |
4 |
|
to |
$ |
6 |
|
|
$ |
20 |
|
to |
$ |
22 |
|
Interest expense and amortization
of deferred financing costs |
$ |
127 |
|
to |
$ |
132 |
|
|
$ |
508 |
|
to |
$ |
528 |
|
Gains (losses) on retirement of
long-term obligations |
$ |
0 |
|
to |
$ |
0 |
|
|
$ |
42 |
|
to |
$ |
42 |
|
Interest income |
$ |
(1 |
) |
to |
$ |
0 |
|
|
$ |
(1 |
) |
to |
$ |
0 |
|
Other income (expense) |
$ |
(1 |
) |
to |
$ |
2 |
|
|
$ |
4 |
|
to |
$ |
6 |
|
Benefit (provision) for income
taxes |
$ |
3 |
|
to |
$ |
7 |
|
|
$ |
15 |
|
to |
$ |
23 |
|
Stock-based compensation
expense |
$ |
21 |
|
to |
$ |
23 |
|
|
$ |
93 |
|
to |
$ |
98 |
|
Adjusted
EBITDA(a) |
$ |
557 |
|
to |
$ |
562 |
|
|
$ |
2,205 |
|
to |
$ |
2,225 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) The above reconciliation
excludes line items included in our definition which are not
applicable for the periods shown. |
For Comparative Purposes -
Reconciliation of Previous Outlook for FFO and AFFO:
|
Previously Issued |
|
Previously Issued |
|
Q3 2016 |
|
Full Year 2016 |
(in millions) |
Outlook |
|
Outlook |
Net income (loss) |
$ |
91 |
|
to |
$ |
111 |
|
|
$ |
318 |
|
to |
$ |
358 |
|
Real estate related
depreciation, amortization and accretion |
$ |
269 |
|
to |
$ |
282 |
|
|
$ |
1,083 |
|
to |
$ |
1,104 |
|
Asset write-down
charges |
$ |
9 |
|
to |
$ |
11 |
|
|
$ |
35 |
|
to |
$ |
45 |
|
Dividends on preferred
stock |
$ |
(11 |
) |
to |
$ |
(11 |
) |
|
$ |
(44 |
) |
to |
$ |
(44 |
) |
FFO(a)(b)(c)(e) |
$ |
375 |
|
to |
$ |
380 |
|
|
$ |
1,421 |
|
to |
$ |
1,441 |
|
|
|
|
|
|
|
|
|
FFO (from above) |
$ |
375 |
|
to |
$ |
380 |
|
|
$ |
1,421 |
|
to |
$ |
1,441 |
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
Straight-line revenue |
$ |
(13 |
) |
to |
$ |
(8 |
) |
|
$ |
(56 |
) |
to |
$ |
(41 |
) |
Straight-line expense |
$ |
21 |
|
to |
$ |
26 |
|
|
$ |
85 |
|
to |
$ |
100 |
|
Stock-based compensation
expense |
$ |
21 |
|
to |
$ |
23 |
|
|
$ |
93 |
|
to |
$ |
98 |
|
Non-cash portion of tax
provision |
$ |
1 |
|
to |
$ |
6 |
|
|
$ |
3 |
|
to |
$ |
18 |
|
Non-real estate related
depreciation, amortization and accretion |
$ |
6 |
|
to |
$ |
8 |
|
|
$ |
24 |
|
to |
$ |
29 |
|
Amortization of non-cash interest
expense |
$ |
3 |
|
to |
$ |
6 |
|
|
$ |
12 |
|
to |
$ |
18 |
|
Other (income) expense |
$ |
(1 |
) |
to |
$ |
2 |
|
|
$ |
4 |
|
to |
$ |
6 |
|
Gains (losses) on retirement of
long-term obligations |
$ |
0 |
|
to |
$ |
0 |
|
|
$ |
42 |
|
to |
$ |
42 |
|
Acquisition and integration
costs |
$ |
3 |
|
to |
$ |
6 |
|
|
$ |
14 |
|
to |
$ |
19 |
|
Capital improvement capital
expenditures |
$ |
(13 |
) |
to |
$ |
(11 |
) |
|
$ |
(41 |
) |
to |
$ |
(36 |
) |
Corporate capital expenditures |
$ |
(14 |
) |
to |
$ |
(12 |
) |
|
$ |
(43 |
) |
to |
$ |
(38 |
) |
AFFO(a)(b)(c)(e) |
$ |
400 |
|
to |
$ |
405 |
|
|
$ |
1,595 |
|
to |
$ |
1,615 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Previously issued third quarter
2016 outlook assumes diluted common shares outstanding as of June
30, 2016 of approximately 339 million shares. Previously issued
full year 2016 outlook assumes diluted common shares outstanding of
approximately 341 million shares, inclusive of the assumed
conversion of the mandatory convertible preferred stock in November
2016. |
(b) See "Non-GAAP Financial Measures
and Other Calculations" herein for a discussion for our definitions
of FFO and AFFO. |
(c) FFO and AFFO are reduced by cash
paid for preferred stock dividends. |
(d) The above reconciliation
excludes line items included in our definition which are not
applicable for the periods shown. |
(e) Attributable to CCIC
common stockholders. |
The components of changes in site rental revenues for
the quarters ended September 30, 2016 and 2015 are as
follows:
|
Three Months Ended September 30, |
(in millions) |
2016 |
|
2015 |
Components of changes
in site rental revenues(f): |
|
|
|
Prior year site rental revenues
exclusive of straight-line associated with fixed
escalators(a)(c) |
$ |
737 |
|
|
$ |
672 |
|
|
|
|
|
New leasing activity(a)(c) |
45 |
|
|
44 |
|
Escalators |
22 |
|
|
23 |
|
Non-renewals |
(20 |
) |
|
(24 |
) |
Organic Contribution to Site Rental
Revenues(d) |
47 |
|
|
43 |
|
Straight-lined revenues associated
with fixed escalators |
9 |
|
|
27 |
|
Acquisitions and builds(b) |
19 |
|
|
23 |
|
Other |
— |
|
|
— |
|
Total GAAP site rental
revenues |
$ |
812 |
|
|
$ |
765 |
|
|
|
|
|
Year-over-year
changes in revenue: |
|
|
|
Reported GAAP site
rental revenues |
6.1 |
% |
|
|
Organic Contribution to
Site Rental Revenues(d)(e) |
6.4 |
% |
|
|
|
|
|
|
|
(a) Includes revenues from amortization of prepaid rent in
accordance with GAAP. |
(b) The
financial impact of acquisitions, as measured by the initial
contribution, and tower builds is excluded from Organic
Contribution to Site Rental Revenues until the one-year anniversary
of the acquisition or build. |
(c) Includes revenues from the construction of new small cell
nodes, exclusive of straight-lined revenues related to fixed
escalators. |
(d) See "Non-GAAP Financial Measures and Other Calculations"
herein. |
(e)
Calculated as the percentage change from prior year site rental
revenues exclusive of straight-line associated with fixed
escalations compared to Organic Contribution to Site Rental
Revenues for the current period. |
(f) Additional information regarding Crown Castle's site
rental revenues including projected revenue from customer licenses,
tenant non-renewals, straight-lined revenues and prepaid rent is
available in Crown Castle's quarterly Supplemental Information
Package posted in the Investors section of its website. |
The components of the changes in site rental revenues
for the years ending December 31, 2016 and 2017 are forecasted
as follows:
|
|
|
|
|
(in millions) |
Midpoint ofFull Year2016 Outlook |
|
Full Year2017 Outlook |
|
Components of changes
in site rental revenues(g): |
|
|
|
|
Prior year site rental revenues
exclusive of straight-line associated with fixed
escalators(a)(c) |
$ |
2,907 |
|
|
$ |
3,184 |
|
|
|
|
|
|
|
New leasing activity(a)(c) |
|
171 |
|
|
150 to 170 |
|
Escalators |
|
89 |
|
|
80 to 85 |
|
Non-renewals |
|
(74 |
) |
|
(95) to (75) |
|
Organic Contribution to Site Rental
Revenues(d) |
|
186 |
|
|
140 to 170 |
|
Straight-lined revenues associated
with fixed escalators |
|
48 |
|
|
(28) to (13) |
|
Acquisitions and builds(b) |
|
89 |
|
|
|
11 |
|
|
Other |
— |
|
— |
|
Total GAAP site rental
revenues |
$ |
3,230 |
|
|
$3,314 to $3,344 |
|
|
|
|
|
|
Year-over-year
changes in revenue: |
|
|
|
|
Reported GAAP site
rental revenues |
|
7.0 |
% |
|
|
3.1 |
% |
|
Organic Contribution to
Site Rental Revenues(d)(e) |
|
6.4 |
% |
|
|
4.9 |
% |
(f) |
|
(a) Includes revenues from amortization of prepaid rent in
accordance with GAAP. |
(b) The financial impact of acquisitions, as measured by the
initial contribution, and tower builds is excluded from Organic
Contribution to Site Rental Revenues until the one-year anniversary
of the acquisition or build. |
(c) Includes revenues from the construction of new small cell
nodes, exclusive of straight-lined revenues related to fixed
escalators. |
(d) See "Non-GAAP Financial Measures and Other Calculations"
herein. |
(e) Calculated as the percentage change from prior year site
rental revenues exclusive of straight-lined associated with fixed
escalations compared to Organic Contribution to Site Rental
Revenues for the current period. |
(f) Calculated based on midpoint of Full Year 2017
Outlook. |
(g) Additional information regarding Crown Castle's site
rental revenues including projected revenue from customer licenses,
tenant non-renewals, straight-lined revenues and prepaid rent is
available in Crown Castle's quarterly Supplemental Information
Package posted in the Investors section of its website. |
Components of Historical Interest
Expense and Amortization of Deferred Financing Costs:
|
For the Three Months Ended |
(in millions) |
September 30, 2016 |
|
September 30, 2015 |
Interest expense on
debt obligations |
$ |
126.6 |
|
|
$ |
121.3 |
|
Amortization of
deferred financing costs and adjustments on long-term debt,
net |
4.6 |
|
|
5.6 |
|
Amortization of
interest rate swaps(a) |
— |
|
|
3.7 |
|
Other, net |
(1.3 |
) |
|
(0.7 |
) |
Interest expense and
amortization of deferred financing costs |
$ |
129.9 |
|
|
$ |
129.9 |
|
|
|
|
|
|
|
|
|
(a) Relates to the amortization
of interest rate swaps; the swaps were cash settled in prior
periods. |
Components of Current Outlook for
Interest Expense and Amortization of Deferred Financing
Costs:
|
Q4 2016 |
|
Full Year 2016 |
|
Full Year 2017 |
(in millions) |
Outlook |
|
Outlook |
|
Outlook |
Interest expense on
debt obligations |
$ |
126 |
|
to |
$ |
128 |
|
|
$ |
501 |
|
to |
$ |
503 |
|
|
$ |
509 |
|
to |
$ |
524 |
|
Amortization of
deferred financing costs and adjustments on long-term debt,
net |
$ |
4 |
|
to |
$ |
7 |
|
|
$ |
17 |
|
to |
$ |
21 |
|
|
$ |
17 |
|
to |
$ |
21 |
|
Other, net |
$ |
(1 |
) |
to |
$ |
(1 |
) |
|
$ |
(5 |
) |
to |
$ |
(5 |
) |
|
$ |
(6 |
) |
to |
$ |
(4 |
) |
Interest
expense and amortization of deferred financing costs |
$ |
128 |
|
to |
$ |
133 |
|
|
$ |
514 |
|
to |
$ |
519 |
|
|
$ |
515 |
|
to |
$ |
545 |
|
Debt balances and maturity dates as of
September 30, 2016 are as follows:
(in
millions) |
Face Value |
|
Final Maturity |
Bank debt - variable
rate: |
|
|
|
2016 Revolver |
$ |
410.0 |
|
Jan.
2021 |
2016 Term Loan A |
1,975.0 |
|
Jan.
2021 |
Total bank debt |
2,385.0 |
|
|
Securitized debt -
fixed rate: |
|
|
|
Secured Notes, Series 2009-1, Class
A-1(a) |
57.2 |
|
Aug.
2019 |
Secured Notes, Series 2009-1, Class
A-2(a) |
70.0 |
|
Aug.
2029 |
Tower Revenue Notes, Series
2010-3(b) |
1,250.0 |
|
Jan.
2040 |
Tower Revenue Notes, Series
2010-6(b) |
1,000.0 |
|
Aug.
2040 |
Tower Revenue Notes, Series
2015-1(b) |
300.0 |
|
May
2042 |
Tower Revenue Notes, Series
2015-2(b) |
700.0 |
|
May
2045 |
Total securitized debt |
3,377.2 |
|
|
Bonds - fixed
rate: |
|
|
|
5.250% Senior Notes |
1,650.0 |
|
Jan.
2023 |
3.849% Secured Notes |
1,000.0 |
|
Apr.
2023 |
4.875% Senior Notes |
850.0 |
|
Apr.
2022 |
3.400% Senior Notes |
850.0 |
|
Feb.
2021 |
4.450% Senior Notes |
900.0 |
|
Feb.
2026 |
3.700% Senior Notes |
750.0 |
|
June
2026 |
2.250% Senior Notes |
700.0 |
|
Sept.
2021 |
Total bonds |
6,700.0 |
|
|
Capital leases and
other obligations |
225.5 |
|
|
Various |
Total Debt |
$ |
12,687.7 |
|
|
|
Less:
Cash and Cash Equivalents(c) |
$ |
156.2 |
|
|
|
Net Debt |
$ |
12,531.5 |
|
|
|
|
(a) The Senior Secured Notes,
Series 2009-1, Class A-1 principal amortizes during the period
beginning January 2010 and ending in 2019 and the Senior Secured
Notes, 2009-1, Class A-2 principal amortizes during the period
beginning in 2019 and ending in 2029. |
(b) The Senior Secured Tower
Revenue Notes, Series 2010-3 and 2010-6 have anticipated repayment
dates in 2020. The Senior Secured Tower Revenue Notes, Series
2015-1 and 2015-2 have anticipated repayment dates in 2022 and
2025, respectively. |
(c) Excludes restricted
cash. |
Net Debt to Last Quarter Annualized Adjusted EBITDA is
computed as follows:
(in millions) |
For the Three Months Ended September 30, 2016 |
Total face value of
debt |
$ |
12,687.7 |
|
Ending cash and cash
equivalents(a) |
156.2 |
|
Total Net Debt |
$ |
12,531.5 |
|
|
|
Adjusted EBITDA for the
three months ended September 30, 2016 |
$ |
564.1 |
|
Last quarter annualized
adjusted EBITDA |
2,256.5 |
|
Net Debt to
Last Quarter Annualized Adjusted EBITDA |
5.6 |
x |
|
(a) Excludes restricted cash. |
Components of Capital
Expenditures:
|
For the Three Months Ended |
(in millions) |
September 30, 2016 |
|
September 30, 2015 |
|
Towers |
Small Cells |
Other |
Total |
|
Towers |
Small Cells |
Other |
Total |
Discretionary: |
|
|
|
|
|
|
|
|
|
Purchases of land interests |
$ |
17.4 |
|
$ |
— |
|
$ |
— |
|
$ |
17.4 |
|
|
$ |
16.0 |
|
$ |
— |
|
$ |
— |
|
$ |
16.0 |
|
Wireless infrastructure
construction and improvements |
76.6 |
|
108.6 |
|
— |
|
185.2 |
|
|
98.0 |
|
92.1 |
|
— |
|
190.1 |
|
Sustaining: |
|
|
|
|
|
|
|
|
|
Capital improvement and
corporate |
9.7 |
|
3.2 |
|
5.6 |
|
18.5 |
|
|
22.4 |
|
3.0 |
|
5.9 |
|
31.3 |
|
Total |
$ |
103.7 |
|
$ |
111.8 |
|
$ |
5.6 |
|
$ |
221.1 |
|
|
$ |
136.4 |
|
$ |
95.1 |
|
$ |
5.9 |
|
$ |
237.4 |
|
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, strategic
position and strength of our business, (3) carrier network
investments and upgrades, and the benefits which may be derived
therefrom, (4) demand for wireless connectivity and the benefits
which may be derived therefrom, (5) our dividends, including our
dividend plans and the amount and growth of our dividends, (6)
leasing activity, (7) our investments, including in towers
and small cells, and the potential growth, returns and benefits
therefrom, (8) demand for our wireless infrastructure and services,
(9) our growth and long-term prospects, (10) tenant non-renewals,
including the impact and timing thereof, (11) capital expenditures,
including sustaining capital expenditures, (12) straight-line
adjustments, (13) expenses, (14) site rental revenues, (15) site
rental cost of operations, (16) site rental gross margin and
network services gross margin, (17) net income (loss), (18)
Adjusted EBITDA, (19) interest expense and amortization of deferred
financing costs, (20) FFO, (21) AFFO, (22) Organic Contribution to
Site Rental Revenues and Organic Contribution to Site Rental
Revenue growth, (23) our common shares outstanding, including on a
diluted basis, and the conversion of our Preferred Stock, and (24)
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 our wireless
infrastructure, driven primarily by demand for wireless
connectivity, 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.• 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.• 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 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, we may find it more difficult to
achieve favorable rental rates on our new or renewing tenant
leases.• New technologies may reduce demand for our wireless
infrastructure or negatively impact our revenues.• 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 retain rights to our wireless
infrastructure, including the land interests under our towers, our
business may be adversely affected.• Our network services business
has historically experienced significant volatility in demand,
which reduces the predictability of our results.• New wireless
technologies may not deploy or be adopted by customers as rapidly
or in the manner projected.• 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 restated certificate of incorporation, amended and restated
by-laws 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.• We may be vulnerable to security breaches that could
adversely affect our business, operations, and reputation.• 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 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 related 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, 2016 |
|
December 31, 2015 |
|
|
|
|
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
156,219 |
|
|
$ |
178,810 |
|
Restricted cash |
116,932 |
|
|
130,731 |
|
Receivables, net |
276,259 |
|
|
313,296 |
|
Prepaid expenses |
157,102 |
|
|
133,194 |
|
Other current assets |
133,163 |
|
|
225,214 |
|
Total current assets |
839,675 |
|
|
981,245 |
|
Deferred site rental
receivables |
1,321,777 |
|
|
1,306,408 |
|
Property and equipment,
net |
9,714,149 |
|
|
9,580,057 |
|
Goodwill |
5,750,033 |
|
|
5,513,551 |
|
Other intangible
assets, net |
3,737,448 |
|
|
3,779,915 |
|
Long-term prepaid rent
and other assets, net |
808,641 |
|
|
775,790 |
|
Total assets |
$ |
22,171,723 |
|
|
$ |
21,936,966 |
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Current
liabilities: |
|
|
|
Accounts payable |
$ |
148,916 |
|
|
$ |
159,629 |
|
Accrued interest |
84,244 |
|
|
66,975 |
|
Deferred revenues |
358,683 |
|
|
322,623 |
|
Other accrued liabilities |
204,533 |
|
|
199,923 |
|
Current maturities of debt and
other obligations |
101,362 |
|
|
106,219 |
|
Total current liabilities |
897,738 |
|
|
855,369 |
|
Debt and other
long-term obligations |
12,491,596 |
|
|
12,043,740 |
|
Other long-term
liabilities |
2,028,672 |
|
|
1,948,636 |
|
Total liabilities |
15,418,006 |
|
|
14,847,745 |
|
Commitments and
contingencies |
|
|
|
CCIC stockholders'
equity: |
|
|
|
Common stock, $.01 par value;
600,000,000 shares authorized; shares issued and outstanding:
September 30, 2016—337,569,931 and December 31,
2015—333,771,660 |
3,375 |
|
|
3,338 |
|
4.50% Mandatory Convertible
Preferred Stock, Series A, $.01 par value; 20,000,000 shares
authorized; shares issued and outstanding: September 30, 2016 and
December 31, 2015—9,775,000; aggregate liquidation value:
September 30, 2016 and December 31, 2015—$977,500 |
98 |
|
|
98 |
|
Additional paid-in capital |
9,914,844 |
|
|
9,548,580 |
|
Accumulated other comprehensive
income (loss) |
(5,541 |
) |
|
(4,398 |
) |
Dividends/distributions in excess
of earnings |
(3,159,059 |
) |
|
(2,458,397 |
) |
Total equity |
6,753,717 |
|
|
7,089,221 |
|
Total liabilities and equity |
$ |
22,171,723 |
|
|
$ |
21,936,966 |
|
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, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Net revenues: |
|
|
|
|
|
|
|
Site rental |
$ |
812,032 |
|
|
$ |
764,606 |
|
|
$ |
2,415,926 |
|
|
$ |
2,233,077 |
|
Network services and other |
179,984 |
|
|
153,501 |
|
|
472,883 |
|
|
484,938 |
|
Net revenues |
992,016 |
|
|
918,107 |
|
|
2,888,809 |
|
|
2,718,015 |
|
Operating
expenses: |
|
|
|
|
|
|
|
Costs of operations (exclusive of
depreciation, amortization and accretion): |
|
|
|
|
|
|
|
Site rental |
256,750 |
|
|
247,000 |
|
|
762,223 |
|
|
716,244 |
|
Network services and other |
109,228 |
|
|
86,859 |
|
|
286,066 |
|
|
263,177 |
|
General and administrative |
89,941 |
|
|
76,699 |
|
|
278,909 |
|
|
223,880 |
|
Asset write-down charges |
8,339 |
|
|
7,477 |
|
|
28,251 |
|
|
19,652 |
|
Acquisition and integration
costs |
2,680 |
|
|
7,608 |
|
|
11,459 |
|
|
12,001 |
|
Depreciation, amortization and
accretion |
280,824 |
|
|
261,662 |
|
|
834,725 |
|
|
766,621 |
|
Total operating expenses |
747,762 |
|
|
687,305 |
|
|
2,201,633 |
|
|
2,001,575 |
|
Operating income
(loss) |
244,254 |
|
|
230,802 |
|
|
687,176 |
|
|
716,440 |
|
Interest expense and
amortization of deferred financing costs |
(129,916 |
) |
|
(129,877 |
) |
|
(385,656 |
) |
|
(398,782 |
) |
Gains (losses) on
retirement of long-term obligations |
(10,274 |
) |
|
— |
|
|
(52,291 |
) |
|
(4,157 |
) |
Interest income |
175 |
|
|
789 |
|
|
454 |
|
|
1,170 |
|
Other income
(expense) |
(832 |
) |
|
(1,214 |
) |
|
(4,623 |
) |
|
58,510 |
|
Income (loss) from
continuing operations before income taxes |
103,407 |
|
|
100,500 |
|
|
245,060 |
|
|
373,181 |
|
Benefit (provision) for
income taxes |
(5,041 |
) |
|
3,801 |
|
|
(12,797 |
) |
|
9,380 |
|
Income (loss) from
continuing operations |
98,366 |
|
|
104,301 |
|
|
232,263 |
|
|
382,561 |
|
Discontinued
operations: |
|
|
|
|
|
|
|
Income (loss) from discontinued
operations, net of tax |
— |
|
|
(522 |
) |
|
— |
|
|
1,000,708 |
|
Net income (loss) |
98,366 |
|
|
103,779 |
|
|
232,263 |
|
|
1,383,269 |
|
Less: Net income (loss)
attributable to the noncontrolling interest |
— |
|
|
— |
|
|
— |
|
|
3,343 |
|
Net income (loss)
attributable to CCIC stockholders |
98,366 |
|
|
103,779 |
|
|
232,263 |
|
|
1,379,926 |
|
Dividends on preferred
stock |
(10,997 |
) |
|
(10,997 |
) |
|
(32,991 |
) |
|
(32,991 |
) |
Net income (loss)
attributable to CCIC common stockholders |
$ |
87,369 |
|
|
$ |
92,782 |
|
|
$ |
199,272 |
|
|
$ |
1,346,935 |
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to
CCIC common stockholders, per common share: |
|
|
|
|
|
|
|
Income (loss) from continuing
operations, basic |
$ |
0.26 |
|
|
$ |
0.28 |
|
|
$ |
0.59 |
|
|
$ |
1.05 |
|
Income (loss) from discontinued
operations, basic |
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
3.00 |
|
Net income (loss) attributable to
CCIC common stockholders, basic |
$ |
0.26 |
|
|
$ |
0.28 |
|
|
$ |
0.59 |
|
|
$ |
4.05 |
|
Income (loss) from continuing
operations, diluted |
$ |
0.26 |
|
|
$ |
0.28 |
|
|
$ |
0.59 |
|
|
$ |
1.05 |
|
Income (loss) from discontinued
operations, diluted |
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
2.99 |
|
Net income (loss) attributable to
CCIC common stockholders, diluted |
$ |
0.26 |
|
|
$ |
0.28 |
|
|
$ |
0.59 |
|
|
$ |
4.04 |
|
|
|
|
|
|
|
|
|
Weighted-average common
shares outstanding (in thousands): |
|
|
|
|
|
|
|
Basic |
337,564 |
|
|
333,049 |
|
|
336,426 |
|
|
332,951 |
|
Diluted |
338,409 |
|
|
333,711 |
|
|
337,076 |
|
|
333,735 |
|
CROWN CASTLE
INTERNATIONAL CORP.CONDENSED CONSOLIDATED STATEMENT OF
CASH FLOWS (UNAUDITED)(in thousands) |
|
|
Nine Months Ended September 30, |
|
|
2016 |
|
2015 |
|
Cash flows from
operating activities: |
|
|
|
|
Net income (loss) from continuing operations |
$ |
232,263 |
|
|
$ |
382,561 |
|
|
Adjustments to
reconcile net income (loss) from continuing operations to net cash
provided by (used for) operating activities: |
|
|
|
|
Depreciation, amortization and
accretion |
834,725 |
|
|
766,621 |
|
|
Gains (losses) on retirement of
long-term obligations |
52,291 |
|
|
4,157 |
|
|
Gains (losses) on settled
swaps |
2,608 |
|
|
(54,475 |
) |
|
Amortization of deferred financing
costs and other non-cash interest |
11,293 |
|
|
32,394 |
|
|
Stock-based compensation
expense |
60,402 |
|
|
44,711 |
|
|
Asset write-down charges |
28,251 |
|
|
19,652 |
|
|
Deferred income tax benefit
(provision) |
6,626 |
|
|
(16,199 |
) |
|
Other adjustments, net |
(1,060 |
) |
|
(7,240 |
) |
|
Changes in assets and liabilities,
excluding the effects of acquisitions: |
|
|
|
|
Increase (decrease) in
liabilities |
122,944 |
|
|
208,538 |
|
|
Decrease (increase) in assets |
(45,628 |
) |
|
(89,844 |
) |
|
Net cash provided by (used for)
operating activities |
1,304,715 |
|
|
1,290,876 |
|
|
Cash flows from
investing activities: |
|
|
|
|
Payments for acquisition of
businesses, net of cash acquired |
(545,162 |
) |
|
(1,083,319 |
) |
|
Capital expenditures |
(614,178 |
) |
|
(658,240 |
) |
|
Net receipts from settled
swaps |
8,141 |
|
|
54,475 |
|
|
Other investing activities,
net |
11,616 |
|
|
(1,561 |
) |
|
Net cash
provided by (used for) investing activities |
(1,139,583 |
) |
|
(1,688,645 |
) |
|
Cash flows from
financing activities: |
|
|
|
|
Proceeds from issuance of long-term
debt |
5,201,010 |
|
|
1,000,000 |
|
|
Principal payments on debt and
other long-term obligations |
(69,717 |
) |
|
(78,049 |
) |
|
Purchases and redemptions of
long-term debt |
(4,044,834 |
) |
|
(1,069,337 |
) |
|
Borrowings under revolving credit
facility |
3,440,000 |
|
|
1,560,000 |
|
|
Payments under revolving credit
facility |
(4,155,000 |
) |
|
(1,240,000 |
) |
|
Payments for financing costs |
(41,471 |
) |
|
(17,415 |
) |
|
Net proceeds from issuance of
capital stock |
323,798 |
|
|
— |
|
|
Purchases of capital stock |
(24,759 |
) |
|
(29,576 |
) |
|
Dividends/distributions paid on
common stock |
(896,628 |
) |
|
(821,056 |
) |
|
Dividends paid on preferred
stock |
(32,991 |
) |
|
(32,991 |
) |
|
Net (increase) decrease in
restricted cash |
40 |
|
|
28,435 |
|
|
Net cash provided by (used for)
financing activities |
(300,552 |
) |
|
(699,989 |
) |
|
Net increase
(decrease) in cash and cash equivalents - continuing
operations |
(135,420 |
) |
|
(1,097,758 |
) |
|
Discontinued
operations: |
|
|
|
|
Net cash
provided by (used for) operating activities |
— |
|
|
4,359 |
|
|
Net cash
provided by (used for) investing activities |
113,150 |
|
|
1,103,577 |
|
|
Net increase
(decrease) in cash and cash equivalents - discontinued
operations |
113,150 |
|
|
1,107,936 |
|
|
Effect of
exchange rate changes |
(321 |
) |
|
(1,682 |
) |
|
Cash and cash equivalents at beginning of
period |
178,810 |
|
|
175,620 |
|
(a) |
Cash and cash
equivalents at end of period |
$ |
156,219 |
|
|
$ |
184,116 |
|
|
Supplemental
disclosure of cash flow information: |
|
|
|
|
Interest
paid |
357,094 |
|
|
364,147 |
|
|
Income
taxes paid |
11,740 |
|
|
23,865 |
|
|
|
|
|
|
|
|
|
(a)
Inclusive of cash and cash equivalents included in discontinued
operations. |
|
|
|
|
|
|
CROWN CASTLE INTERNATIONAL
CORP.SEGMENT OPERATING RESULTS (UNAUDITED)(in
thousands) |
|
SEGMENT OPERATING RESULTS |
|
Three Months Ended September 30, 2016 |
|
Three Months Ended September 30, 2015 |
|
Towers |
|
Small Cells |
|
Other |
|
Consolidated Total |
|
Towers |
|
Small Cells |
|
Other |
|
Consolidated Total |
Segment site rental
revenues |
$ |
709,603 |
|
|
$ |
102,429 |
|
|
|
|
$ |
812,032 |
|
|
$ |
686,934 |
|
|
$ |
77,672 |
|
|
|
|
$ |
764,606 |
|
Segment network
services and other revenue |
166,979 |
|
|
13,005 |
|
|
|
|
179,984 |
|
|
138,566 |
|
|
14,935 |
|
|
|
|
153,501 |
|
Segment revenues |
876,582 |
|
|
115,434 |
|
|
|
|
992,016 |
|
|
825,500 |
|
|
92,607 |
|
|
|
|
918,107 |
|
Segment site rental
cost of operations |
210,322 |
|
|
37,754 |
|
|
|
|
248,076 |
|
|
209,056 |
|
|
30,449 |
|
|
|
|
239,505 |
|
Segment network
services and other cost of operations |
97,395 |
|
|
10,194 |
|
|
|
|
107,589 |
|
|
75,302 |
|
|
10,213 |
|
|
|
|
85,515 |
|
Segment cost of
operations(a) |
307,717 |
|
|
47,948 |
|
|
|
|
355,665 |
|
|
284,358 |
|
|
40,662 |
|
|
|
|
325,020 |
|
Segment site rental gross
margin(b) |
499,281 |
|
|
64,675 |
|
|
|
|
563,956 |
|
|
477,878 |
|
|
47,223 |
|
|
|
|
525,101 |
|
Segment network services
and other gross margin(b) |
69,584 |
|
|
2,811 |
|
|
|
|
72,395 |
|
|
63,264 |
|
|
4,722 |
|
|
|
|
67,986 |
|
Segment general and
administrative expenses(a) |
22,225 |
|
|
14,480 |
|
|
35,526 |
|
|
72,231 |
|
|
22,994 |
|
|
10,194 |
|
|
30,741 |
|
|
63,929 |
|
Segment operating
profit(b) |
546,640 |
|
|
53,006 |
|
|
(35,526 |
) |
|
564,120 |
|
|
518,148 |
|
|
41,751 |
|
|
(30,741 |
) |
|
529,158 |
|
Stock-based compensation
expense |
|
|
|
|
22,594 |
|
|
22,594 |
|
|
|
|
|
|
16,466 |
|
|
16,466 |
|
Depreciation, amortization
and accretion |
|
|
|
|
280,824 |
|
|
280,824 |
|
|
|
|
|
|
261,662 |
|
|
261,662 |
|
Interest expense and
amortization of deferred financing costs |
|
|
|
|
129,916 |
|
|
129,916 |
|
|
|
|
|
|
129,877 |
|
|
129,877 |
|
Other (income) expenses to
reconcile to income (loss) from continuing operations before income
taxes(c) |
|
|
|
|
27,379 |
|
|
27,379 |
|
|
|
|
|
|
20,653 |
|
|
20,653 |
|
Income (loss) from
continuing operations before income taxes |
|
|
|
|
|
|
$ |
103,407 |
|
|
|
|
|
|
|
|
$ |
100,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Segment cost of operations
exclude (1) stock-based compensation expense of $4.9 million and
$3.7 million for the three months ended September 30, 2016 and
2015, respectively and (2) prepaid lease purchase price adjustments
of $5.4 million and $5.1 million for the three months ended
September 30, 2016 and 2015, respectively. Segment
general and administrative expenses exclude stock-based
compensation expense of $17.7 million and $12.8 million for the
three months ended September 30, 2016 and 2015,
respectively. |
(b) See "Non-GAAP Financial Measures
and Other Calculations" herein for a discussion of our definitions
of segment site rental gross margin, segment network service and
other gross margin and segment operating profit. |
(c) Other (income) expenses to
reconcile to income (loss) from continuing operations before income
taxes includes (1) losses on retirement of long-term obligations of
approximately $10.3 million and $0 for the three months ended
September 30, 2016 and 2015, respectively and (2) gains (losses) on
swaps of approximately $0 and $10.2 million for the three months
ended September 30, 2016 and 2015, respectively. |
SEGMENT OPERATING RESULTS |
|
Nine Months Ended September 30, 2016 |
|
Nine Months Ended September 30, 2015 |
|
Towers |
|
Small Cells |
|
Other |
|
Consolidated Total |
|
Towers |
|
Small Cells |
|
Other |
|
Consolidated Total |
Segment site rental
revenues |
$ |
2,118,159 |
|
|
$ |
297,767 |
|
|
|
|
$ |
2,415,926 |
|
|
$ |
2,040,147 |
|
|
$ |
192,930 |
|
|
|
|
$ |
2,233,077 |
|
Segment network
services and other revenue |
434,042 |
|
|
38,841 |
|
|
|
|
472,883 |
|
|
445,683 |
|
|
39,255 |
|
|
|
|
484,938 |
|
Segment revenues |
2,552,201 |
|
|
336,608 |
|
|
|
|
2,888,809 |
|
|
2,485,830 |
|
|
232,185 |
|
|
|
|
2,718,015 |
|
Segment site rental
cost of operations |
625,331 |
|
|
109,402 |
|
|
|
|
734,733 |
|
|
620,726 |
|
|
73,818 |
|
|
|
|
694,544 |
|
Segment network
services and other cost of operations |
249,306 |
|
|
30,652 |
|
|
|
|
279,958 |
|
|
229,164 |
|
|
30,034 |
|
|
|
|
259,198 |
|
Segment cost of
operations(a) |
874,637 |
|
|
140,054 |
|
|
|
|
1,014,691 |
|
|
849,890 |
|
|
103,852 |
|
|
|
|
953,742 |
|
Segment site rental gross
margin(b) |
1,492,828 |
|
|
188,365 |
|
|
|
|
1,681,193 |
|
|
1,419,421 |
|
|
119,112 |
|
|
|
|
1,538,533 |
|
Segment network services
and other gross margin(b) |
184,736 |
|
|
8,189 |
|
|
|
|
192,925 |
|
|
216,519 |
|
|
9,221 |
|
|
|
|
225,740 |
|
Segment general and
administrative expenses(a) |
68,329 |
|
|
45,720 |
|
|
107,161 |
|
|
221,210 |
|
|
68,245 |
|
|
25,664 |
|
|
90,981 |
|
|
184,890 |
|
Segment operating
profit(b) |
1,609,235 |
|
|
150,834 |
|
|
(107,161 |
) |
|
1,652,908 |
|
|
1,567,695 |
|
|
102,669 |
|
|
(90,981 |
) |
|
1,579,383 |
|
Stock-based compensation
expense |
|
|
|
|
75,297 |
|
|
75,297 |
|
|
|
|
|
|
49,282 |
|
|
49,282 |
|
Depreciation, amortization
and accretion |
|
|
|
|
834,725 |
|
|
834,725 |
|
|
|
|
|
|
766,621 |
|
|
766,621 |
|
Interest expense and
amortization of deferred financing costs |
|
|
|
|
385,656 |
|
|
385,656 |
|
|
|
|
|
|
398,782 |
|
|
398,782 |
|
Other income (expenses) to
reconcile to income (loss) from continuing operations before income
taxes(c) |
|
|
|
|
112,170 |
|
|
112,170 |
|
|
|
|
|
|
(8,483 |
) |
|
(8,483 |
) |
Income (loss) from
continuing operations before income taxes |
|
|
|
|
|
|
$ |
245,060 |
|
|
|
|
|
|
|
|
$ |
373,181 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Segment cost of operations
exclude (1) stock-based compensation expense of $17.6 million and
$10.3 million for the nine months ended September 30, 2016 and
2015, respectively and (2) prepaid lease purchase price adjustments
of $16.0 million and $15.4 million for the nine months ended
September 30, 2016 and 2015, respectively. Segment general and
administrative expenses exclude stock-based compensation expense of
$57.7 million and $39.0 million for the nine months ended
September 30, 2016 and 2015, respectively. |
(b) See "Non-GAAP Financial
Measures and Other Calculations" herein for a discussion of our
definitions of segment site rental gross margin, segment network
service and other gross margin and segment operating profit. |
(c) Other income (expenses) to
reconcile to income (loss) from continuing operations before income
taxes includes (1) losses on retirement of long-term obligations of
approximately $52.3 million and $4.2 million for the nine months
ended September 30, 2016 and 2015, respectively and (2) gains
(losses) on swaps of approximately $(2.6 million) and $70.0 million
for the nine months ended September 30, 2016 and 2015,
respectively. |
Contacts: Dan Schlanger, CFO
Son Nguyen, VP &
Treasurer
Crown Castle International Corp.
713-570-3050
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