Operating Segments and Concentrations of Credit Risk

12 Months Ended

Dec. 31, 2012

Operating Segments and Concentrations of Credit Risk [Abstract]

Operating Segments and Concentrations of Credit Risks

Operating Segments and Concentrations of Credit Risk

Operating Segments

The Company's reportable operating segments are (1) CCUSA, consisting of the Company's U.S. operations, and (2) CCAL, the Company's Australian operations. Financial results for the Company are reported to management and the board of directors in this manner.

The measurement of profit or loss currently used by management to evaluate the results of operations for the Company and its operating segments is earnings before interest, taxes, depreciation, amortization and accretion, as adjusted ("Adjusted EBITDA"). The Company defines Adjusted EBITDA as net income (loss) plus restructuring charges (credits), asset write-down charges, acquisition and integration costs, depreciation, amortization and accretion, amortization of prepaid lease purchase price adjustments, interest expense and amortization of deferred financing costs, gains (losses) on retirement of long-term obligations, net gain (loss) on interest rate swaps, impairment of available-for-sale securities, interest income, other income (expense), benefit (provision) for income taxes, cumulative effect of change in accounting principle, income (loss) from discontinued operations and stock-based compensation expense. Adjusted EBITDA is not intended as an alternative measure of operating results or cash flows from operations (as determined in accordance with GAAP), and the Company's measure of Adjusted EBITDA may not be comparable to similarly titled measures of other companies. There are no significant revenues resulting from transactions between the Company's operating segments. Inter-company borrowings and related interest between segments are eliminated to reconcile segment results and assets to the consolidated basis. Noncontrolling interests primarily represent the noncontrolling shareholders' 22.4% interests in CCAL, the Company's 77.6% majority-owned subsidiary.

The financial results for the Company's operating segments are as follows:

	Year Ended December 31, 2012												Year Ended December 31, 2011												Year Ended December 31, 2010
	CCUSA			CCAL			Elim(a)			Consolidated Total			CCUSA			CCAL			Elim(a)			Consolidated Total			CCUSA			CCAL			Elim(a)			Consolidated Total
Net revenues:
Site rental	$	2,001,049		$	123,141		$	—		$	2,124,190		$	1,744,993		$	108,557		$	—		$	1,853,550		$	1,608,141		$	92,620		$	—		$	1,700,761
Network services and other	285,287			23,203			—			308,490			161,522			17,657			—			179,179			168,101			9,796			—			177,897
Net revenues	2,286,336			146,344			—			2,432,680			1,906,515			126,214			—			2,032,729			1,776,242			102,416			—			1,878,658
Operating expenses:
Costs of operations(b):
Site rental	503,661			35,578			—			539,239			446,868			34,530			—			481,398			437,812			29,324			—			467,136
Network services and other	173,762			15,988			—			189,750			96,057			10,930			—			106,987			107,668			6,573			—			114,241
General and administrative	184,911			27,661			—			212,572			151,737			21,756			—			173,493			148,374			16,982			—			165,356
Asset write-down charges	15,226			322			—			15,548			21,986			299			—			22,285			13,243			444			—			13,687
Acquisition and integration costs	18,216			82			—			18,298			3,310			—			—			3,310			2,102			—			—			2,102
Depreciation, amortization and accretion	591,428			31,164			—			622,592			522,681			30,270			—			552,951			513,433			27,338			—			540,771
Total operating expenses	1,487,204			110,795			—			1,597,999			1,242,639			97,785			—			1,340,424			1,222,632			80,661			—			1,303,293
Operating income (loss)	799,132			35,549			—			834,681			663,876			28,429			—			692,305			553,610			21,755			—			575,365
Interest expense and amortization of deferred financing costs	(601,031		)	(19,330		)	19,317			(601,044		)	(507,264		)	(22,974		)	22,651			(507,587		)	(488,863		)	(21,381		)	19,975			(490,269		)
Gains (losses) on retirement of long-term obligations	(131,974		)	—			—			(131,974		)	—			—			—			—			(138,367		)	—			—			(138,367		)
Net gain (loss) on interest rate swaps	—			—			—			—			—			—			—			—			(286,435		)	—			—			(286,435		)
Interest income	4,089			467			—			4,556			187			479			—			666			1,888			316			—			2,204
Other income (expense)	13,954			(29		)	(19,317		)	(5,392		)	17,048			26			(22,651		)	(5,577		)	19,151			221			(19,975		)	(603		)
Benefit (provision) for income taxes	60,144			39,917			—			100,061			(6,126		)	(2,221		)	—			(8,347		)	28,808			(1,962		)	—			26,846
Net income (loss)	144,314			56,574			—			200,888			167,721			3,739			—			171,460			(310,208		)	(1,051		)	—			(311,259		)
Less: Net income (loss) attributable to the noncontrolling interest	(268		)	12,572			—			12,304			(348		)	731			—			383			—			(319		)	—			(319		)
Net income (loss) attributable to CCIC stockholders	$	144,582		$	44,002		$	—		$	188,584		$	168,069		$	3,008		$	—		$	171,077		$	(310,208	)	$	(732	)	$	—		$	(310,940	)
Capital expenditures	$	419,980		$	21,403		$	—		$	441,383		$	333,862		$	14,080		$	—		$	347,942		$	216,556		$	11,502		$	—		$	228,058
Total assets (at year end)	$	15,969,084		$	440,395		$	(320,770	)	$	16,088,709		$	10,497,387		$	341,852		$	(294,143	)	$	10,545,096
Goodwill	$	3,116,824		$	3,133		$	—		$	3,119,957		$	2,034,683		$	707		$	—		$	2,035,390

(a) Elimination of inter-company borrowings and related interest expense.

(b) Exclusive of depreciation, amortization and accretion shown separately.

The following are reconciliations of net income (loss) to Adjusted EBITDA for the years ended December 31, 2012, 2011 and 2010:

	Year Ended December 31, 2012												Year Ended December 31, 2011												Year Ended December 31, 2010
	CCUSA			CCAL			Elim(a)			Consolidated Total			CCUSA			CCAL			Elim(a)			Consolidated Total			CCUSA			CCAL			Elim(a)			Consolidated Total
Net income (loss)	$	144,314		$	56,574		$	—		$	200,888		$	167,721		$	3,739		$	—		$	171,460		$	(310,208	)	$	(1,051	)	$	—		$	(311,259	)
Adjustments to increase (decrease) net income (loss):
Asset write-down charges	15,226			322			—			15,548			21,986			299			—			22,285			13,243			444			—			13,687
Acquisition and integration costs	18,216			82			—			18,298			3,310			—			—			3,310			2,102			—			—			2,102
Depreciation, amortization and accretion	591,428			31,164			—			622,592			522,681			30,270			—			552,951			513,433			27,338			—			540,771
Amortization of prepaid lease purchase price adjustments	14,166			—			—			14,166			—			—			—			—			—			—			—			—
Interest expense and amortization of deferred financing costs	601,031			19,330			(19,317		)	601,044			507,264			22,974			(22,651		)	507,587			488,863			21,381			(19,975		)	490,269
Gains (losses) on retirement of long-term obligations	131,974			—			—			131,974			—			—			—			—			138,367			—			—			138,367
Net gain (loss) on interest rate swaps	—			—			—			—			—			—			—			—			286,435			—			—			286,435
Interest income	(4,089		)	(467		)	—			(4,556		)	(187		)	(479		)	—			(666		)	(1,888		)	(316		)	—			(2,204		)
Other income (expense)	(13,954		)	29			19,317			5,392			(17,048		)	(26		)	22,651			5,577			(19,151		)	(221		)	19,975			603
Benefit (provision) for income taxes	(60,144		)	(39,917		)	—			(100,061		)	6,126			2,221			—			8,347			(28,808		)	1,962			—			(26,846		)
Stock-based compensation expense	41,785			5,597			—			47,382			32,610			3,381			—			35,991			36,540			3,425			—			39,965
Adjusted EBITDA	$	1,479,953		$	72,714		$	—		$	1,552,667		$	1,244,463		$	62,379		$	—		$	1,306,842		$	1,118,928		$	52,962		$	—		$	1,171,890

____________________

(a) Elimination of inter-company borrowings and related interest expense.

Geographic Information

A summary of net revenues by country, based on the location of the Company's subsidiaries, is as follows:

	Years Ended December 31,
	2012		2011		2010
United States	$	2,283,088	$	1,902,536	$	1,772,793
Australia	146,344		126,214		102,416
Other countries	3,248		3,979		3,449
Total net revenues	$	2,432,680	$	2,032,729	$	1,878,658

A summary of long-lived assets (property and equipment, goodwill and other intangible assets) by country of location is as follows:

	December 31,
	2012		2011
United States	$	12,730,337	$	8,847,161
Australia	232,099		212,067
Other countries	16,748		15,571
Total long-lived assets	$	12,979,184	$	9,074,799

Major Customers

The following table summarizes the percentage of the consolidated revenues for those customers accounting for more than 10% of the consolidated revenues, all of which relates to CCUSA.

	Years Ended December 31,
	2012		2011		2010
Sprint	24	%	21	%	20	%
AT&T	20	%	23	%	21	%
Verizon Wireless	17	%	19	%	21	%
T-Mobile	11	%	11	%	11	%
Total	72	%	74	%	73	%

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk are primarily cash and cash equivalents, restricted cash and trade receivables. The Company mitigates its risk with respect to cash and cash equivalents by maintaining such deposits at high credit quality financial institutions and monitoring the credit ratings of those institutions. The Company's restricted cash is predominately held and directed by a trustee (see note 2).

The Company derives the largest portion of its revenues from customers in the wireless communications industry. The Company also has a concentration in its volume of business with Sprint, AT&T, Verizon Wireless and T-Mobile or their agents that accounts for a significant portion of the Company's revenues, receivables and deferred site rental receivables. The Company mitigates its concentrations of credit risk with respect to trade receivables by actively monitoring the creditworthiness of its customers, the use of customer leases with contractually determinable payment terms and proactive management of past due balances.