Announces Significant Growth from Core
Operations Revenue Growth of 28% in the Third
Quarter
Radius Global Infrastructure, Inc. (NASDAQ:RADI) (“Radius” or
the “Company”), one of the largest global owners and acquirors of
primarily triple net real property interests and contractual rights
underlying wireless communications cell sites and other essential
digital infrastructure in 19 countries, today reported results for
the third quarter of 2020.
“Our business continues to thrive, despite the broader
challenges presented by the global health care crisis. Revenue and
gross profit increased to $17.9 million and $17.7 million,
respectively, for the third quarter, bringing our Annualized In
Place Rents to $68.9 million as of September 30, 2020. Our stable
portfolio of cash flow streams provides a compelling balance of
yield and growth generated by leases for essential telecom
infrastructure, and we are well positioned to continue our global
growth with significant cash availability,” commented Bill Berkman,
Co-Chairman and Chief Executive Officer.
As this represents the initial quarterly reporting cycle for
Radius as a Nasdaq-listed company, we refer you to the GAAP
financial disclosure and reconciliations to non-GAAP financial
measurement set forth below and in the Company’s Form 10-Q. The
Company pays for its acquisitions of real property interests either
with a one-time payment at the time of acquisition or, in a limited
number of instances, with a combination of upfront payments and
future contractually committed payments over a period of time, in
each case pursuant to the individual acquisition agreement. In our
consolidated statements of cash flows, the one-time and upfront
cash payments are reported as Investments in Real Property
Interests and related Intangible Assets. The total cash spent and
the commitment for future payments in any given period for the
acquisition of real property interests adjusted for changes in
foreign currency is our Acquisition Capex. Acquisition Capex is a
non-GAAP metric, albeit one the Company believes is valuable to
readers of the Company’s financial statements. Please refer to the
table below for a full reconciliation of Acquisition Capex.
QUARTERLY RESULTS
Revenue increased 28% to $17.9 million for the three
months ended September 30, 2020 compared to revenue of $14.0
million for the three months ended September 30, 2019.
Gross Profit increased 26% to $17.7 million in the 2020
three-month period when compared to revenue of $14.0 million in the
corresponding 2019 three month period.
YEAR TO DATE RESULTS
Revenue increased 21% to $49.6 million for the nine
months ended September 30, 2020 compared to revenue of $40.9
million for the nine months ended September 30, 2019.
Gross Profit increased 20% to $49.2 million in the 2020
nine-month period when compared to revenue of $40.8 million in the
corresponding 2019 nine-month period.
Annualized in Place Rents increased to $68.9 million as
of September 30, 2020, an increase of 21% over the September 30,
2019 Annualized In Place Rents of $57.0 million.
Investments in Real Property Interests and related
intangibles was $77.9 million for the nine months ended September
30, 2020, an increase of 59% over the prior period.
Acquisition Capex deployed by the company was $102.3
million for the nine months ended September 30, 2020 compared to
$60.7 million for the nine months ended September 30, 2019, an
increase of 69%.
FINANCING TRANSACTIONS
The Company added approximately $157 million of USD equivalents
in the quarter through the issuance of 10-year, fixed rate,
interest only secured notes under its existing international debt
facility. Approximately $75 million of the debt was issued in Euros
at a fixed rate of 3%, and 55 million of the debt was issued in GPB
at a fixed rate of 3.9%.
Attachment: Financial statement tables and non-GAAP
reconciliations
Webcast and Conference Call Information
Management will host a webcast and conference call on Monday,
November 16, 2020 at 10:30 A.M. Eastern Standard Time to review
financial results, discuss recent events and conduct a
question-and-answer session.
The live webcast and presentation slides will be available
through the “News & Events” section of the Company’s website,
https://www.radiusglobal.com/news-events/events-presentations.
Participants are advised to go to the site at least 15 minutes
prior to the scheduled start time in order to register, download
and install any necessary audio software.
For those unable to access the webcast, the conference call will
be accessible domestically or internationally, by dialing
1-877-407-0789 or 1-201-689-8562, respectively. Upon dialing in,
please request to join the Radius Global Infrastructure Third
Quarter 2020 Earnings Conference Call.
A replay of the webcast and access to the presentation slides
will be available on the Company’s website. A replay of the call
and the presentation slides can be accessed until Monday, November
30 by dialing 1-844-512-2921 domestically or 1-412-317-6671
internationally, and entering passcode 13711924.
About the Company
Radius Global Infrastructure, Inc., through its subsidiary AP
Wireless ("APW"), is a multinational owner of a growing,
diversified portfolio of triple-net ground, rooftop and other
critical communications properties leased to wireless carriers and
tower companies underlying their mission critical cell site antenna
infrastructure. APW's proven lease origination engine drives highly
attractive yields on capital invested. The Company is also
expanding into other digital infrastructure segments and has a
broad pipeline of proprietary and non-proprietary acquisitions,
investments, and build-to-suit opportunities.
AP Wireless, previously a portfolio company of Associated
Partners, LP, was acquired on February 10, 2020 by Landscape
Acquisition Holdings Limited, a special purpose acquisition company
(“SPAC”), then domiciled in the British Virgin Islands and publicly
listed on the London Stock Exchange. At the time of the
transaction, the Company changed its name to Digital Landscape
Group, Inc., and was subsequently relisted on the London Stock
Exchange on April 1, 2020. On October 2, 2020, the Company
re-domiciled in Delaware and changed its name to Radius Global
Infrastructure, Inc., and on October 5, 2020 the Company’s Class A
Common Stock commenced trading on the NASDAQ Global Market under
the ticker symbol RADI.
For further information see https://www.radiusglobal.com.
FORWARD-LOOKING STATEMENTS AND DISCLAIMERS
This press release, including the attachments, contain
forward-looking statements as defined in the Private Securities
Litigation Reform Act of 1995, as amended. You can identify these
statements by the use of forward-looking terminology such as "may,"
"will," "should," "expect," "anticipate," "project," "estimate, "
"intend," "continue" or "believe" or the negatives thereof or other
variations thereon or comparable terminology. You should read
statements that contain these words carefully because they discuss
our plans, strategies, prospects, and expectations concerning our
business, operating results, financial condition, and other similar
matters. We believe that it is important to communicate our future
expectations to our investors. There may be events in the future,
however, that we are not able to predict accurately or control. Any
forward-looking statement made by us in this press release speaks
only as of the date on which we make it. Factors or events that
could cause our actual results to differ may emerge from time to
time, and it is not possible for us to predict all of them. We
undertake no obligation to update or revise publicly any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law.
The Company has filed with the Securities and Exchange
Commission (“SEC”), and the SEC has declared effective, a
registration statement on Form S-4 (including a prospectus) in
connection with the Company’s listing of its Class A Common Stock
on NASDAQ and its domestication to Delaware. In connection with the
NASDAQ listing and the domestication, you should read the
prospectus in that registration statement and other documents the
Company has filed with the SEC for more complete information about
the Company, the NASDAQ listing and the domestication. These
documents are available for free by visiting EDGAR on the SEC
website at www.sec.gov.
RADIUS GLOBAL INFRASTRUCTURE,
INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (Unaudited)
(in thousands, except share and
per share amounts)
Successor
Predecessor
Three months ended September
30, 2020
Period from February 10, 2020
to September 30, 2020
Period from January 1, 2020 to
February 9, 2020
Three months ended September
30, 2019
Nine months ended September
30, 2019
Revenue
$
17,861
$
42,797
$
6,836
$
14,002
$
40,939
Cost of service
200
375
34
14
88
Gross profit
17,661
42,422
6,802
13,988
40,851
Operating expenses:
Selling, general and administrative
14,231
42,915
4,344
7,764
23,562
Share-based compensation
4,072
79,173
—
—
—
Management incentive plan
—
—
—
—
765
Amortization and depreciation
11,683
30,512
2,584
5,064
14,273
Impairment - decommission of cell
sites
1,462
2,059
530
122
1,327
Total operating expenses
31,448
154,659
7,458
12,950
39,927
Operating income (loss)
(13,787
)
(112,237
)
(656
)
1,038
924
Other income (expense):
Realized and unrealized (loss) gain on
foreign currency debt
(18,138
)
(17,408
)
11,500
11,668
13,508
Interest expense, net
(7,499
)
(16,821
)
(3,623
)
(8,248
)
(23,820
)
Other income (expense), net
987
1,362
(277
)
(2,031
)
(2,436
)
Gain on extinguishment of debt
—
1,264
—
—
—
Total other income (expense), net
(24,650
)
(31,603
)
7,600
1,389
(12,748
)
Income (loss) before income tax
expense
(38,437
)
(143,840
)
6,944
2,427
(11,824
)
Income tax expense
3,455
4,884
767
1,284
2,233
Net income (loss)
(41,892
)
(148,724
)
$
6,177
$
1,143
$
(14,057
)
Net loss attributable to noncontrolling
interest
(3,373
)
(6,347
)
Net loss attributable to Radius Global
Infrastructure, Inc. ordinary shareholders
$
(38,519
)
$
(142,377
)
Loss per ordinary share:
Basic and diluted
$
(0.66
)
$
(2.44
)
Weighted average ordinary shares
outstanding:
Basic and diluted
58,425,000
58,425,000
RADIUS GLOBAL INFRASTRUCTURE,
INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS (Unaudited)
(in thousands, except share and
per share amounts)
Successor
Predecessor
September 30, 2020
December 31, 2019
Assets
Current assets:
Cash and cash equivalents
$
169,135
$
62,892
Restricted cash
1,727
1,140
Trade receivables, net
4,935
7,578
Prepaid expenses and other current
assets
11,994
9,199
Total current assets
187,791
80,809
Real property interests, net:
Right-of-use assets - finance leases,
net
201,197
80,498
Cell site leasehold interests, net
760,381
346,662
Real property interests, net
961,578
427,160
Intangible assets, net
5,134
2,848
Property and equipment, net
613
1,095
Goodwill
89,164
—
Deferred tax asset
—
991
Restricted cash, long-term
153,065
14,014
Other long-term assets
5,735
5,892
Total assets
$
1,403,080
$
532,809
Liabilities and Stockholders’
Equity/Members’ Deficit
Current liabilities:
Accounts payable and accrued expenses
$
30,282
$
22,786
Rent received in advance
17,008
13,856
Finance lease liabilities, current
8,032
5,749
Cell site leasehold interest liabilities,
current
5,521
8,379
Current portion of long-term debt, net of
deferred financing costs
—
48,884
Total current liabilities
60,843
99,654
Finance lease liabilities
22,142
10,451
Cell site leasehold interest
liabilities
10,269
8,462
Long-term debt, net of debt discount and
deferred financing costs
695,308
524,047
Deferred tax liability
58,121
—
Other long-term liabilities
7,267
5,531
Total liabilities
853,950
648,145
Commitments and contingencies
Stockholders’ equity/Members’ deficit:
Series A Founder Preferred Shares
(Successor), no par value; 1,600,000 shares authorized; 1,600,000
shares issued and outstanding as of September 30, 2020
—
—
Series B Founder Preferred Shares
(Successor), no par value; 1,386,033 shares authorized; 1,386,033
shares issued and outstanding as of September 30, 2020
—
—
Ordinary Shares (Successor), no par value;
1,590,000,000 shares authorized; 58,425,000 shares issued and
outstanding as of September 30, 2020
—
—
Class B Shares (Successor), no par value;
200,000,000 shares authorized; 11,414,030 shares issued and
outstanding as of September 30, 2020
—
—
Class A units (Predecessor)
—
33,672
Common units (Predecessor)
—
85,347
Additional paid-in capital (Successor)
669,707
—
Members’ accumulated deficit
(Predecessor)
—
(208,883
)
Members’ accumulated other comprehensive
loss (Predecessor)
—
(25,472
)
Accumulated other comprehensive loss
(Successor)
(4,900
)
—
Accumulated deficit (Successor)
(173,523
)
—
Total stockholders’ equity attributable to
Radius Global Infrastructure, Inc./members’ deficit
491,284
(115,336
)
Noncontrolling interest
57,846
—
Total liabilities and stockholders’
equity/members' deficit
$
1,403,080
$
532,809
RADIUS GLOBAL INFRASTRUCTURE,
INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited)
(in thousands, except share and
per share amounts)
Successor
Predecessor
Period from February 10, 2020
to September 30, 2020
Period from January 1, 2020 to
February 9, 2020
Nine months ended September
30, 2019
Cash flows from operating
activities:
Net income (loss)
$
(148,724
)
$
6,177
$
(14,057
)
Adjustments to reconcile net income (loss)
to net cash used in operating activities:
Amortization and depreciation
30,512
2,584
14,273
Amortization of finance lease and cell
site leasehold interest liabilities discount
1,157
213
1,557
Impairment – decommission of cell
sites
2,059
530
1,327
Realized and unrealized gain on foreign
currency debt
17,408
(11,500
)
(13,508
)
Amortization of debt discount and deferred
financing costs
80
280
1,985
Provision for bad debt expense
238
26
565
Share-based compensation
79,173
—
—
Deferred income taxes
2,123
339
—
Gain on extinguishment of debt
(1,264
)
—
—
Change in assets and liabilities:
Trade receivables, net
2,463
(682
)
(892
)
Prepaid expenses and other assets
(740
)
935
(682
)
Accounts payable, accrued expenses and
other long-term liabilities
(16,199
)
(4,605
)
1,442
Rent received in advance
922
2,251
773
Net cash used in operating activities
(30,792
)
(3,452
)
(7,217
)
Cash flows from investing
activities:
Cash paid in APW Acquisition, net of cash
acquired
(277,065
)
—
—
Investments in real property interests and
related intangible assets
(72,823
)
(5,064
)
(49,256
)
Advances on note receivable
(2,500
)
(17,500
)
—
Payments received on note receivable
20,000
—
—
Purchases of property and equipment
(296
)
(40
)
(163
)
Net cash used in investing activities
(332,685
)
(22,604
)
(49,419
)
Cash flows from financing
activities:
Borrowings under the Facility
Agreement
160,475
—
18,600
Repayments of the Loan Agreement
(48,025
)
(250
)
(500
)
Debt issuance costs
(3,692
)
—
(610
)
Repayments of finance lease and cell site
leasehold interest liabilities
(9,003
)
(3,149
)
(10,485
)
Net cash provided by (used in) financing
activities
99,755
(3,399
)
7,005
Net change in cash and cash equivalents
and restricted cash
(263,721
)
(29,455
)
(49,631
)
Effect of change in foreign currency
exchange rates on cash and restricted cash
(980
)
(232
)
1,159
Cash and cash equivalents and restricted
cash at beginning of period
588,628
78,046
101,414
Cash and cash equivalents and restricted
cash at end of period
$
323,927
$
48,359
$
52,942
Supplemental disclosure of cash and
non-cash transactions:
Cash paid for interest
$
15,039
$
4,684
$
19,117
Cash paid for income taxes
$
2,222
$
1,112
$
895
Non-GAAP Financial Measures
We identify certain additional financial measures not defined by
GAAP that provide supplemental information we believe is useful to
analysts and investors to evaluate our financial performance and
ongoing results of operations, when considered alongside other GAAP
measures such as net income, operating income, gross profit and net
cash provided by operating activities. These non-GAAP measures
exclude the financial impact of items management does not consider
in assessing our ongoing operating performance, and thereby
facilitate review of our operating performance on a
period-to-period basis.
EBITDA and Adjusted EBITDA
EBITDA and Adjusted EBITDA are non-GAAP measures. EBITDA is
defined as net income (loss) before net interest expense, income
tax expense, and depreciation and amortization. Adjusted EBITDA is
calculated by taking EBITDA and further adjusting for management
incentive plan expense, non-cash impairment—decommission of cell
sites expense, realized and unrealized gains and losses on foreign
currency debt, unrealized foreign exchange gains/losses associated
with intercompany account balances denominated in a currency other
than the functional currency, nonrecurring expenses incurred in
connection with the Domestication, and severance costs included in
selling, general and administrative expenses. Management believes
the presentation of EBITDA and Adjusted EBITDA provides valuable
additional information for users of the financial statements in
assessing our financial condition and results of operations. Each
of EBITDA and Adjusted EBITDA has important limitations as
analytical tools because they exclude some, but not all, items that
affect net income, therefore the calculation of these financial
measures may be different from the calculations used by other
companies and comparability may therefore be limited. You should
not consider EBITDA, Adjusted EBITDA or any of our other non-GAAP
financial measures as an alternative or substitute for our
results.
The following are reconciliations of EBITDA and Adjusted EBITDA
to net income (loss), the most comparable GAAP measure:
Successor
Predecessor
(in thousands)
Period from February 10
– September 30, 2020
Period from January 1 –
February 9, 2020
Nine Months Ended September
30, 2019
(unaudited)
Net income (loss)
$
(148,724
)
$
6,177
$
(14,057
)
Amortization and depreciation
30,512
2,584
14,273
Interest expense, net
16,821
3,623
23,820
Income tax expense
4,884
767
2,233
EBITDA
(96,507
)
13,151
26,269
Impairment—decommission of cell sites
2,059
530
1,327
Realized/unrealized loss (gain) on foreign
currency debt
17,408
(11,500
)
(13,508
)
Share-based compensation expense
79,173
—
—
Management incentive plan expense
—
—
765
Non-cash foreign currency adjustments
750
523
2,062
Nonrecurring domestication and public
company registration expenses
7,848
—
—
Adjusted EBITDA
$
10,731
$
2,704
$
16,915
Acquisition Capex
Acquisition Capex is a non-GAAP financial measure. The Company’s
payments for its acquisitions of real property interests consist of
either a one-time payment upon the acquisition or up-front payments
with contractually committed payments made over a period of time,
pursuant to each cell site leasehold interest agreement. In all
cases, the Company contractually acquires all rights associated
with the underlying revenue-producing assets upon entering into the
agreement to purchase the real property interest and records the
related assets in the period of acquisition. Acquisition Capex
therefore represents the total cash spent and committed to be spent
for the Company’s acquisitions of revenue-producing assets during
the period measured. Management believes the presentation of
Acquisition Capex provides valuable additional information for
users of the financial statements in assessing our financial
performance and growth, as it is a comprehensive measure of our
investments in the revenue-producing assets that we acquire in a
given period. Acquisition Capex has important limitations as an
analytical tool, because it excludes certain fixed and variable
costs related to our selling and marketing activities included in
selling, general and administrative expenses in the consolidated
statements of operations, including corporate overhead expenses.
Further, this financial measure may be different from calculations
used by other companies and comparability may therefore be limited.
You should not consider Acquisition Capex or any of the other
non-GAAP measures we utilize as an alternative or substitute for
our results.
The following is a reconciliation of Acquisition Capex to the
amounts included as an investing cash flow in our consolidated
statements of cash flows for investments in real property interests
and related intangible assets, the most comparable GAAP measure,
which generally represents up-front payments made in connection the
acquisition of these assets during the period. The primary
adjustment to the comparable GAAP measure is “committed contractual
payments for investments in real property interests and intangible
assets”, which represents the total amount of future payments that
we were contractually committed to make in connection with our
acquisitions of real property interests and intangible assets that
occurred during the period. Additionally, foreign exchange
translation adjustments impact the determination of Acquisition
Capex.
Successor
Predecessor
(in thousands)
Period from February 10
– September 30, 2020
Period from January 1
– February 9, 2020
Nine Months Ended September
30, 2019
(unaudited)
Investments in real property interests and
related intangible assets
$
72,823
$
5,064
$
49,256
Committed contractual payments for
investments in real property interests and intangible assets
21,950
1,533
14,098
Foreign exchange translation impacts and
other
1,220
(262
)
(2,699
)
Acquisition Capex
$
95,993
$
6,335
$
60,655
Annualized In-Place Rents
Annualized in-place rents is a non-GAAP measure that measures
performance based on annualized contractual revenue from the rents
expected to be collected on leases owned and acquired (“in place”)
as of the measurement date. Annualized in-place rents is calculated
using the implied monthly revenue from all revenue producing leases
that are in place as of the measurement date multiplied by twelve.
Implied monthly revenue for each lease is calculated based on the
most recent rental payment made under such lease. Management
believes the presentation of annualized in-place rents provides
valuable additional information for users of the financial
statements in assessing our financial performance and growth. In
particular, management believes the presentation of annualized
in-place rents provides a measurement at the applicable point of
time as opposed to revenue, which is recorded in the applicable
period on revenue-producing assets in place as they are acquired.
Annualized in-place rents has important limitations as an
analytical tool because it is calculated at a particular moment in
time, the measurement date, but implies an annualized amount of
contractual revenue. As a result, following the measurement date,
among other things, the underlying leases used in calculating the
annualized in-place rents financial measure may be terminated, new
leases may be acquired, or the contractual rents payable under such
leases may not be collected. In these respects, among others,
annualized in-place rents differs from “revenue”, which is the
closest comparable GAAP measure and which represents all revenues
(contractual or otherwise) earned over the applicable period.
Revenue is recorded as earned over the period in which the lessee
is given control over the use of the wireless communication sites
and recorded over the term of the lease. You should not consider
annualized in-place rents or any of the other non-GAAP measures we
utilize as an alternative or substitute for our results. The
following is a comparison of annualized in-place rents to revenue,
the most comparable GAAP measure:
(in thousands)
2020
2019
Revenue for year ended December 31
$
55,706
Annualized in-place rents as of December
31
$
62,095
Annualized in-place rents as of September
30
$
68,858
$
57,016
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201116005321/en/
Investor Relations: ICR Inc. Evelyn Infurna/Nikki Sacks
investorrelations@radiusglobal.com 1-484-278-2667
Media: Sard Verbinnen & Co Jim Barron/Jared Levy
Radius-SVC@sardverb.com 212-687-8080
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