Delaware | 001-16441 | 76-0470458 | |||||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | |||||
1220 Augusta Drive, Suite 600 Houston, TX | 77057 | ||||||
(Address of principal executive offices) | (Zip Code) |
(Former name or former address, if changed since last report.) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit No. | Description | |
99.1 | Press Release dated October 30, 2014 | |
99.2 | Supplemental Information Package for the quarter ended September 30, 2014 |
CROWN CASTLE INTERNATIONAL CORP. | ||||
By: | /s/ E. Blake Hawk | |||
Name: | E. Blake Hawk | |||
Title: | Executive Vice President and General Counsel |
Exhibit No. | Description | |
99.1 | Press Release dated October 30, 2014 | |
99.2 | Supplemental Information Package for the quarter ended September 30, 2014 |
![]() | NEWS RELEASE October 30, 2014 |
Contacts: Jay Brown, CFO | |
Son Nguyen, VP - Corporate Finance | |
FOR IMMEDIATE RELEASE | Crown Castle International Corp. |
713-570-3050 |
• | Announces increase in dividend rate to $3.28 per common share annually, or 75% of 2015 expected AFFO |
• | Exceeds third quarter Outlook for Adjusted EBITDA and AFFO |
• | Provides 2015 Outlook with growth muted by headwinds from tenant non-renewals associated with carrier consolidation |
News Release continued: | Page 2 |
News Release continued: | Page 3 |
• | Aligning of shareholder returns to the core business model |
• | Reinforcing confidence in the long-term, recurring nature of Crown Castle's cash flows |
• | Retaining sufficient liquidity to achieve long-term, embedded organic growth opportunity |
• | Increasing the certainty of a significant component of shareholder returns given an expectation that future growth rates are likely to be lower than historical growth rates |
• | Potential to lower Crown Castle's cost of capital |
• | Maintaining balance sheet profile consistent with investment grade credit rating objective |
News Release continued: | Page 4 |
News Release continued: | Page 5 |
News Release continued: | Page 6 |
(in millions, except per share amounts) | Fourth Quarter 2014 | Full Year 2014 | Full Year 2015 |
Site rental revenues | $755 to $760 | $3,001 to $3,006 | $3,047 to $3,067 |
Site rental cost of operations | $234 to $239 | $940 to $945 | $964 to $979 |
Site rental gross margin | $519 to $524 | $2,058 to $2,063 | $2,073 to $2,093 |
Adjusted EBITDA | $538 to $543 | $2,128 to $2,133 | $2,126 to $2,146 |
Interest expense and amortization of deferred financing costs(a) | $138 to $143 | $571 to $576 | $521 to $536 |
FFO | $353 to $358 | $1,317 to $1,322 | $1,429 to $1,449 |
AFFO | $346 to $351 | $1,396 to $1,401 | $1,437 to $1,457 |
AFFO per share(b) | $1.04 to $1.05 | $4.19 to $4.20 | $4.31 to $4.37 |
Net income (loss) | $97 to $130 | $342 to $375 | $428 to $512 |
Net income (loss) per share - diluted(b) | $0.29 to $0.39 | $1.03 to $1.13 | $1.28 to $1.54 |
Net income (loss) attributable to CCIC common stockholders | $84 to $121 | $300 to $337 | $382 to $474 |
Net income (loss) attributable to CCIC common stockholders per share - diluted(b) | $0.25 to $0.36 | $0.90 to $1.01 | $1.15 to $1.42 |
(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) | Based on 333.2 million diluted shares outstanding as of September 30, 2014. |
News Release continued: | Page 7 |
News Release continued: | Page 8 |
News Release continued: | Page 9 |
News Release continued: | Page 10 |
For the Three Months Ended | |||||||
September 30, 2014 | September 30, 2013 | ||||||
(in millions) | |||||||
Net income (loss) | $ | 108.0 | $ | 46.5 | |||
Adjustments to increase (decrease) net income (loss): | |||||||
Asset write-down charges | 5.3 | 3.9 | |||||
Acquisition and integration costs | 4.1 | 4.4 | |||||
Depreciation, amortization and accretion | 254.9 | 195.4 | |||||
Amortization of prepaid lease purchase price adjustments | 5.0 | 3.9 | |||||
Interest expense and amortization of deferred financing costs(a) | 141.3 | 142.0 | |||||
Interest income | (0.2 | ) | (0.2 | ) | |||
Other income (expense) | 0.7 | 0.6 | |||||
Benefit (provision) for income taxes | 0.5 | 34.0 | |||||
Stock-based compensation expense | 13.5 | 10.2 | |||||
Adjusted EBITDA(b) | $ | 533.0 | $ | 440.6 |
(a) | See the reconciliation of "components of interest expense and amortization of deferred financing costs" herein for a discussion of non-cash interest expense. |
(b) | The above reconciliation excludes line items included in our Adjusted EBITDA definition which are not applicable for the periods shown. |
Q4 2014 | Full Year 2014 | Full Year 2015 | |||
(in millions) | Outlook | Outlook | Outlook | ||
Net income (loss) | $97 to $130 | $342 to $375 | $428 to $512 | ||
Adjustments to increase (decrease) net income (loss): | |||||
Asset write-down charges | $4 to $6 | $15 to $17 | $16 to $26 | ||
Acquisition and integration costs | $2 to $6 | $31 to $35 | $0 to $0 | ||
Depreciation, amortization and accretion | $252 to $257 | $1,011 to $1,016 | $1,007 to $1,027 | ||
Amortization of prepaid lease purchase price adjustments | $4 to $6 | $18 to $20 | $19 to $21 | ||
Interest expense and amortization of deferred financing costs(a) | $138 to $143 | $571 to $576 | $521 to $536 | ||
Gains (losses) on retirement of long-term obligations | $0 to $0 | $45 to $45 | $0 to $0 | ||
Interest income | $(1) to $1 | $(2) to $0 | $(2) to $0 | ||
Other income (expense) | $(1) to $1 | $9 to $11 | $1 to $3 | ||
Benefit (provision) for income taxes | $1 to $5 | $1 to $5 | $7 to $15 | ||
Stock-based compensation expense | $14 to $16 | $59 to $61 | $65 to $70 | ||
Adjusted EBITDA(b) | $538 to $543 | $2,128 to $2,133 | $2,126 to $2,146 |
(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 Adjusted EBITDA definition which are not applicable for the periods shown. |
News Release continued: | Page 11 |
Q4 2014 | Full Year 2014 | Full Year 2015 | |||
(in millions, except share and per share amounts) | Outlook | Outlook | Outlook | ||
Net income | $97 to $130 | $342 to $375 | $428 to $512 | ||
Real estate related depreciation, amortization and accretion | $248 to $251 | $992 to $995 | $990 to $1,005 | ||
Asset write-down charges | $4 to $6 | $15 to $17 | $16 to $26 | ||
Adjustment for noncontrolling interest (a) | $(2) to $2 | $(6) to $(2) | $(6) to $2 | ||
Dividends on preferred stock | $(11) to $(11) | $(44) to $(44) | $(44) to $(44) | ||
FFO(c) | $353 to $358 | $1,317 to $1,322 | $1,429 to $1,449 | ||
FFO (from above) | $353 to $358 | $1,317 to $1,322 | $1,429 to $1,449 | ||
Adjustments to increase (decrease) FFO: | |||||
Straight-line revenue | $(49) to $(44) | $(198) to $(193) | $(144) to $(129) | ||
Straight-line expense | $23 to $28 | $102 to $107 | $87 to $102 | ||
Stock-based compensation expense | $14 to $16 | $59 to $61 | $65 to $70 | ||
Non-cash portion of tax provision | $(2) to $3 | $(10) to $(5) | $(5) to $10 | ||
Non-real estate related depreciation, amortization and accretion | $4 to $6 | $19 to $21 | $17 to $22 | ||
Amortization of non-cash interest expense | $19 to $23 | $79 to $83 | $31 to $42 | ||
Other (income) expense | $(1) to $1 | $9 to $11 | $1 to $3 | ||
Gains (losses) on retirement of long-term obligations | $0 to $0 | $45 to $45 | $0 to $0 | ||
Acquisition and integration costs | $2 to $6 | $31 to $35 | $0 to $0 | ||
Adjustment for noncontrolling interest (a) | $2 to $(2) | $6 to $2 | $6 to $(2) | ||
Capital improvement capital expenditures | $(15) to $(13) | $(32) to $(30) | $(38) to $(33) | ||
Corporate capital expenditures | $(18) to $(16) | $(47) to $(45) | $(47) to $(42) | ||
AFFO(c) | $346 to $351 | $1,396 to $1,401 | $1,437 to $1,457 | ||
Weighted average common shares outstanding — diluted (b) | 333.2 | 333.2 | 333.2 | ||
AFFO per share (c) | $1.04 to $1.05 | $4.19 to $4.20 | $4.31 to $4.37 |
(a) | Inclusive of the noncontrolling interest related to real estate related depreciation, amortization and accretion and asset write-downs. |
(b) | Based on diluted shares outstanding as of September 30, 2014. |
(c) | See "Non-GAAP Financial Measures and Other Calculations" herein for a discussion of the definitions of FFO and AFFO. |
News Release continued: | Page 12 |
Midpoint of Full Year | Midpoint of Full Year | ||||||||||
(in millions of dollars) | Full Year 2013 | 2014 Outlook | 2015 Outlook | ||||||||
GAAP site rental revenues | $ | 2,504 | $ | 3,004 | $ | 3,057 | |||||
Site rental straight-line revenues | (219 | ) | (196 | ) | (137 | ) | |||||
Other - Non-recurring | – | (5 | ) | – | |||||||
Site Rental Revenues, as Adjusted(a)(c) | $ | 2,285 | $ | 2,803 | $ | 2,921 | |||||
Cash adjustments: | |||||||||||
FX and other | 10 | 8 | |||||||||
New tower acquisitions and builds | (379 | ) | (5 | ) | |||||||
Organic Site Rental Revenues(a)(b)(c) | $ | 2,434 | $ | 2,924 | |||||||
Year-Over-Year Revenue Growth | |||||||||||
GAAP site rental revenues | 19.9 | % | 1.8 | % | |||||||
Site Rental Revenues, as Adjusted | 22.6 | % | 4.2 | % | |||||||
Organic Site Rental Revenues(d)(e) | 6.5 | % | 4.3 | % |
(a) | Includes amortization of prepaid rent. |
(b) | Includes Site Rental Revenues, as Adjusted, from the construction of new small cell nodes. |
(c) | See "Non-GAAP Financial Measures and Other Calculations" herein. |
(d) | Year-over-year Organic Site Rental Revenue growth for the years ending December 31, 2014 and December 31, 2015: |
Midpoint of Full Year 2014 Outlook | Midpoint of Full Year 2015 Outlook | ||||
New leasing activity | 5.5 | % | 5.1 | % | |
Escalators | 3.6 | % | 3.3 | % | |
Organic Site Rental Revenue growth, before non-renewals | 9.1 | % | 8.5 | % | |
Non-renewals | (2.6 | )% | (4.2 | )% | |
Organic Site Rental Revenue growth | 6.5 | % | 4.3 | % |
(e) | Calculated as the percentage change from Site Rental Revenues, as Adjusted, for the prior period when compared to Organic Site Rental Revenue for the current period. |
News Release continued: | Page 13 |
Three Months Ended September 30, | |||||||
(in millions of dollars) | 2014 | 2013 | |||||
Beginning towers as of September 30, 2013 | 31,619 | ||||||
Net tower additions/(dispositions) | 9,795 | ||||||
Ending towers as of September 30, 2014 | 41,414 | ||||||
Reported GAAP site rental revenues | $ | 752 | $ | 621 | |||
Site rental straight-line revenues | (47 | ) | (53 | ) | |||
Site Rental Revenues, as Adjusted(a) | $ | 705 | $ | 567 | |||
Cash adjustments: | |||||||
FX and other | — | ||||||
New tower acquisitions and builds | (98 | ) | |||||
Organic Site Rental Revenues(b)(c) | $ | 607 | |||||
Year-Over-Year Revenue Growth | |||||||
Reported GAAP site rental revenues | 21.1 | % | |||||
Site Rental Revenues, as Adjusted | 24.3 | % | |||||
Organic Site Rental Revenues(d)(e) | 7.0 | % |
(a) | Includes amortization of prepaid rent. |
(b) | Includes Site Rental Revenues, as Adjusted from the construction of new small cell nodes |
(c) | See "Non-GAAP Financial Measures and Other Calculations" herein. |
(d) | Quarter-over-quarter Organic Site Rental Revenue growth for the quarter ending September 30, 2014: |
Three Months Ended September 30, 2014 | ||
New leasing activity | 6.3 | % |
Escalators | 3.7 | % |
Organic Site Rental Revenue growth, before non-renewals | 10.0 | % |
Non-renewals | (3.0 | )% |
Organic Site Rental Revenue Growth | 7.0 | % |
(e) | Calculated as the percentage change from Site Rental Revenues, as Adjusted, for the prior period when compared to Organic Site Rental Revenue for the current period. |
News Release continued: | Page 14 |
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
(in millions, except share and per share amounts) | September 30, 2014 | September 30, 2013 | September 30, 2014 | September 30, 2013 | ||||||||||||
Net income | $ | 108.0 | $ | 46.5 | $ | 246.2 | $ | 116.6 | ||||||||
Real estate related depreciation, amortization and accretion | 250.0 | 192.7 | 743.9 | 562.5 | ||||||||||||
Asset write-down charges | 5.3 | 3.9 | 11.1 | 10.7 | ||||||||||||
Adjustment for noncontrolling interest (a) | (1.1 | ) | (0.6 | ) | (3.7 | ) | (2.9 | ) | ||||||||
Dividends on preferred stock | (11.0 | ) | — | (33.0 | ) | — | ||||||||||
FFO(c) | $ | 351.2 | (e) | $ | 242.4 | (d) | $ | 964.5 | (e) | $ | 686.9 | (d) | ||||
Weighted average common shares outstanding — diluted | 333.2 | 291.4 | 333.0 | 292.0 | ||||||||||||
FFO per share(c) | $ | 1.05 | $ | 0.83 | $ | 2.90 | $ | 2.35 | ||||||||
FFO (from above) | $ | 351.2 | $ | 242.4 | $ | 964.5 | $ | 686.9 | ||||||||
Adjustments to increase (decrease) FFO: | ||||||||||||||||
Straight-line revenue | (46.8 | ) | (53.3 | ) | (149.7 | ) | (169.6 | ) | ||||||||
Straight-line expense | 25.0 | 20.6 | 78.8 | 61.9 | ||||||||||||
Stock-based compensation expense | 13.5 | 10.2 | 44.6 | 29.9 | ||||||||||||
Non-cash portion of tax provision | (2.6 | ) | 32.5 | (b) | (7.5 | ) | 83.3 | |||||||||
Non-real estate related depreciation, amortization and accretion | 4.9 | 2.7 | 15.4 | 10.0 | ||||||||||||
Amortization of non-cash interest expense | 19.8 | 20.8 | 61.3 | 78.2 | ||||||||||||
Other (income) expense | 0.7 | 0.6 | 9.5 | 0.8 | ||||||||||||
Gains (losses) on retirement of long-term obligations | — | — | 44.6 | 36.5 | ||||||||||||
Acquisition and integration costs | 4.1 | 4.4 | 28.9 | 13.2 | ||||||||||||
Adjustment for noncontrolling interest (a) | 1.1 | 0.6 | 3.7 | 2.9 | ||||||||||||
Capital improvement capital expenditures | (7.9 | ) | (3.7 | ) | (16.2 | ) | (9.5 | ) | ||||||||
Corporate capital expenditures | (12.5 | ) | (6.5 | ) | (28.2 | ) | (17.7 | ) | ||||||||
AFFO(c) | $ | 350.4 | $ | 271.3 | $ | 1,049.7 | $ | 806.8 | ||||||||
Weighted average common shares outstanding — diluted | 333.2 | 291.4 | 333.0 | 292.0 | ||||||||||||
AFFO per share(c) | $ | 1.05 | $ | 0.93 | $ | 3.15 | $ | 2.76 | ||||||||
AFFO (from above) | $ | 350.4 | $ | 271.3 | $ | 1,049.7 | $ | 806.8 | ||||||||
Prepaid rent received | 81.2 | 63.9 | 233.1 | 153.6 | ||||||||||||
Amortization of prepaid rent | (27.5 | ) | (17.1 | ) | (69.1 | ) | (47.1 | ) | ||||||||
AFFO, as previously defined (c) | $ | 404.1 | $ | 318.2 | $ | 1,213.7 | $ | 913.3 |
(a) | Inclusive of the noncontrolling interest related to real estate related depreciation, amortization and accretion and asset write-downs. |
(b) | Adjusts the income tax provision for 2013 to reflect our estimate of the cash taxes had we been a REIT, which predominately relates to foreign taxes paid. As a result, income tax expense (benefit) is lower by the amount of the adjustment. |
(c) | See "Non-GAAP Financial Measures and Other Calculations" herein for a discussion of the definitions of FFO and AFFO. |
(d) | FFO, as previously defined, for Q3 and year to date 2013 was previously reported as $271.7 million and $762.4 million, respectively, which is exclusive of the net impact from the update of the definition of $29.3 million and $75.5 million, respectively, which amount includes the adjustment for non-cash portion of tax provision and excludes the adjustments for asset write down charges and noncontrolling interests. |
(e) | FFO, as previously defined, for Q3 and year to date 2014 was $344.4 million and $949.6 million respectively, which is exclusive of the net impact from the update of the definition of $(6.8) million and $(14.9) million, respectively, which amount includes the adjustment for non-cash portion of tax provision and excludes the adjustments for asset write-down charges and noncontrolling interests. |
News Release continued: | Page 15 |
For the Three Months Ended | |||||||
(in millions) | September 30, 2014 | September 30, 2013 | |||||
Interest expense on debt obligations | $ | 121.5 | $ | 121.2 | |||
Amortization of deferred financing costs | 5.5 | 5.4 | |||||
Amortization of adjustments on long-term debt | (0.9 | ) | (1.0 | ) | |||
Amortization of interest rate swaps(a) | 15.6 | 16.2 | |||||
Other, net | (0.3 | ) | 0.2 | ||||
Interest expense and amortization of deferred financing costs | $ | 141.3 | $ | 142.0 |
(a) | Relates to the amortization of interest rate swaps; the swaps were cash settled in prior periods. |
Q4 2014 | Full Year 2014 | Full Year 2015 | |||
(in millions) | Outlook | Outlook | Outlook | ||
Interest expense on debt obligations | $121 to $123 | $492 to $494 | $488 to $498 | ||
Amortization of deferred financing costs | $6 to $7 | $22 to $23 | $21 to $23 | ||
Amortization of adjustments on long-term debt | $(1) to $0 | $(4) to $(3) | $(4) to $(2) | ||
Amortization of interest rate swaps (a) | $14 to $16 | $62 to $64 | $16 to $21 | ||
Other, net | $0 to $0 | $(1) to $(1) | $(2) to $0 | ||
Interest expense and amortization of deferred financing costs | $138 to $143 | $571 to $576 | $521 to $536 |
(a) | Relates to the amortization of interest rate swaps, all of which has been cash settled in prior periods. |
News Release continued: | Page 16 |
(in millions) | |||||
Face Value | Final Maturity | ||||
Revolver | $ | 354.0 | Nov. 2018/Jan 2019 | ||
Term Loan A | 650.1 | Nov. 2018/Jan 2019 | |||
Term Loan B | 2,842.7 | Jan. 2019/Jan. 2021 | |||
4.875% Senior Notes | 850.0 | Apr. 2022 | |||
5.25% Senior Notes | 1,650.0 | Jan. 2023 | |||
2012 Secured Notes(a) | 1,500.0 | Dec. 2017/Apr. 2023 | |||
Senior Secured Notes, Series 2009-1(b) | 165.6 | Various | |||
Senior Secured Tower Revenue Notes, Series 2010-2-2010-3(c) | 1,600.0 | Various | |||
Senior Secured Tower Revenue Notes, Series 2010-4-2010-6(d) | 1,550.0 | Various | |||
WCP Secured Wireless Site Contracts Revenue Notes, Series 2010-1(e) | 263.7 | Nov. 2040 | |||
Capital Leases and Other Obligations | 147.1 | Various | |||
Total Debt | $ | 11,573.1 | |||
Less: Cash and Cash Equivalents(f) | $ | 238.6 | |||
Net Debt | $ | 11,334.5 |
(a) | The 2012 Secured Notes consist of $500 million aggregate principal amount of 2.381% secured notes due 2017 and $1.0 billion aggregate principal amount of 3.849% secured notes due 2023. |
(b) | The Senior Secured Notes, Series 2009-1 consist of $95.6 million of principal as of September 30, 2014 that amortizes during the period beginning January 2010 and ending in 2019, and $70.0 million of principal that amortizes during the period beginning in 2019 and ending in 2029. |
(c) | The Senior Secured Tower Revenue Notes Series 2010-2 and 2010-3 have principal amounts of $350.0 million and $1.25 billion with anticipated repayment dates of 2017 and 2020, respectively. |
(d) | The Senior Secured Tower Revenue Notes Series 2010-4, 2010-5 and 2010-6 have principal amounts of $250.0 million, $300.0 million and $1.0 billion with anticipated repayment dates of 2015, 2017 and 2020, respectively. |
(e) | The WCP Secured Wireless Site Contracts Revenue Notes, Series 2010-1 ("WCP Securitized Notes") were assumed in connection with the WCP acquisition. If the WCP Securitized Notes are not repaid in full by their anticipated repayment dates in 2015, the applicable interest rate increases by an additional approximately 5% per annum. If the WCP Securitized Notes are not repaid in full by their rapid amortization date of 2017, monthly principal payments commence. |
(f) | Excludes restricted cash. |
(in millions) | For the Three Months Ended September 30, 2014 | ||
Total face value of debt | $ | 11,573.1 | |
Ending cash and cash equivalents | 238.6 | ||
Total Net Debt | $ | 11,334.5 | |
Adjusted EBITDA for the three months ended September 30, 2014 | $ | 533.0 | |
Last quarter annualized adjusted EBITDA | 2,131.8 | ||
Net Debt to Last Quarter Annualized Adjusted EBITDA | 5.3x |
For the Three Months Ended | |||||||
(in millions) | September 30, 2014 | September 30, 2013 | |||||
Capital Expenditures | $ | 203.8 | $ | 130.7 | |||
Less: Land purchases | 16.5 | 17.6 | |||||
Less: Wireless infrastructure construction and improvements | 167.0 | 102.8 | |||||
Sustaining capital expenditures | $ | 20.4 | $ | 10.2 |
News Release continued: | Page 17 |
• | Our business depends on the demand for wireless communications and wireless infrastructure, and we may be adversely affected by any slowdown in such demand. Additionally, a reduction in carrier network investment may materially and adversely affect our business (including reducing demand for new tenant additions and network services). |
• | A substantial portion of our revenues is derived from a small number of customers, and the loss, consolidation or financial instability of any of our limited number of customers may materially decrease revenues or reduce demand for our wireless infrastructure and network services. |
• | Our substantial level of indebtedness could adversely affect our ability to react to changes in our business, and the terms of our debt instruments limit our ability to take a number of actions that our management might otherwise believe to be in our best interests. In addition, if we fail to comply with our covenants, our debt could be accelerated. |
• | We have a substantial amount of indebtedness. In the event we do not repay or refinance such indebtedness, we could face substantial liquidity issues and might be required to issue equity securities or securities convertible into equity securities, or sell some of our assets to meet our debt payment obligations. |
• | Sales or issuances of a substantial number of shares of our common stock may adversely affect the market price of our common stock. |
• | As a result of competition in our industry, including from some competitors with significantly more resources or less debt than we have, we may find it more difficult to achieve favorable rental rates on our new or renewing customer contracts. |
• | The business model for our small cell operations contains differences from our traditional site rental business, resulting in different operational risks. If we do not successfully operate that business model or identify or manage those operational risks, such operations may produce results that are less than anticipated. |
• | New technologies may significantly reduce demand for our wireless infrastructure and negatively impact our revenues. |
• | New wireless technologies may not deploy or be adopted by customers as rapidly or in the manner projected. |
• | If we fail to retain rights to our wireless infrastructure, including the land under our sites, our business may be adversely affected. |
• | Our network services business has historically experienced significant volatility in demand, which reduces the predictability of our results. |
• | The expansion and development of our business, including through acquisitions, increased product offerings, or other strategic growth opportunities, may cause disruptions in our business, which may have an adverse effect on our business, operations or financial results. |
• | If we fail to comply with laws and regulations which regulate our business and which may change at any time, we may be fined or even lose our right to conduct some of our business. |
• | If radio frequency emissions from wireless handsets or equipment on our wireless infrastructure are demonstrated to cause negative health effects, potential future claims could adversely affect our operations, costs or revenues. |
• | Certain provisions of our certificate of incorporation, bylaws and operative agreements and domestic and international competition laws may make it more difficult for a third party to acquire control of us or for us to acquire control of a third party, even if such a change in control would be beneficial to our stockholders. |
News Release continued: | Page 18 |
• | We may be adversely affected by our exposure to changes in foreign currency exchange rates relating to our operations in Australia. |
• | Future dividend payments to our common 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. |
• | Qualifying and remaining qualified to be taxed as a REIT involves highly technical and complex provisions of the US Internal Revenue Code. Failure to remain qualified as a REIT would result in our inability to deduct dividends to stockholders when computing our taxable income, which would reduce our available cash. |
• | Complying with REIT requirements, including the 90% distribution requirement, may limit our flexibility or cause us to forgo otherwise attractive opportunities, including certain discretionary investments and potential financing alternatives. |
• | If we fail to pay scheduled dividends on the 4.50% Mandatory Convertible Preferred Stock, in cash, common stock or any combination of cash and common stock, we will be prohibited from paying dividends on our Common Stock, which may jeopardize our status as a REIT. |
• | We have limited experience operating as a REIT. Our failure to successfully operate as a REIT may adversely affect our financial condition, cash flow, the per share trading price of our common stock, or our ability to satisfy debt service obligations. |
• | We expect to pursue certain REIT-related ownership limitations and transfer restrictions with respect to our capital stock. |
News Release continued: | Page 19 |
![]() | CROWN CASTLE INTERNATIONAL CORP. CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED) (in thousands, except share amounts) |
September 30, 2014 | December 31, 2013 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 238,550 | $ | 223,394 | |||
Restricted cash | 137,824 | 183,526 | |||||
Receivables, net | 311,798 | 249,925 | |||||
Prepaid expenses | 154,240 | 132,003 | |||||
Deferred income tax assets | 40,201 | 26,714 | |||||
Other current assets | 96,182 | 77,121 | |||||
Total current assets | 978,795 | 892,683 | |||||
Deferred site rental receivables | 1,220,050 | 1,078,995 | |||||
Property and equipment, net | 8,870,817 | 8,947,677 | |||||
Goodwill | 5,091,800 | 4,916,426 | |||||
Other intangible assets, net | 3,795,426 | 4,057,865 | |||||
Deferred income tax assets | 10,855 | 19,008 | |||||
Long-term prepaid rent, deferred financing costs and other assets, net | 817,117 | 682,254 | |||||
Total assets | $ | 20,784,860 | $ | 20,594,908 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 175,110 | $ | 145,390 | |||
Accrued interest | 68,044 | 65,582 | |||||
Deferred revenues | 327,265 | 260,114 | |||||
Other accrued liabilities | 168,475 | 181,715 | |||||
Current maturities of debt and other obligations | 106,673 | 103,586 | |||||
Total current liabilities | 845,567 | 756,387 | |||||
Debt and other long-term obligations | 11,467,005 | 11,490,914 | |||||
Deferred income tax liabilities | 57,118 | 56,513 | |||||
Deferred credits and other liabilities | 1,552,425 | 1,349,919 | |||||
Total liabilities | 13,922,115 | 13,653,733 | |||||
Commitments and contingencies | |||||||
CCIC stockholders' equity: | |||||||
Common stock, $.01 par value; 600,000,000 shares authorized; shares issued and outstanding: September 30, 2014—333,859,447 and December 31, 2013—334,070,016 | 3,339 | 3,341 | |||||
4.50% Mandatory Convertible Preferred Stock, Series A, $.01 par value; 20,000,000 shares authorized; shares issued and outstanding: September 30, 2014 and December 31, 2013—9,775,000; aggregate liquidation value: September 30, 2014 and December 31, 2013—$977,500 | 98 | 98 | |||||
Additional paid-in capital | 9,500,490 | 9,482,769 | |||||
Accumulated other comprehensive income (loss) | 19,006 | (23,612 | ) | ||||
Dividends/distributions in excess of earnings | (2,677,959 | ) | (2,535,879 | ) | |||
Total CCIC stockholders' equity | 6,844,974 | 6,926,717 | |||||
Noncontrolling interest | 17,771 | 14,458 | |||||
Total equity | 6,862,745 | 6,941,175 | |||||
Total liabilities and equity | $ | 20,784,860 | $ | 20,594,908 |
News Release continued: | Page 20 |
![]() | 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, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
Net revenues: | |||||||||||||||
Site rental | $ | 751,893 | $ | 620,766 | $ | 2,245,395 | $ | 1,853,030 | |||||||
Network services and other | 178,132 | 128,211 | 476,925 | 370,935 | |||||||||||
Net revenues | 930,025 | 748,977 | 2,722,320 | 2,223,965 | |||||||||||
Operating expenses: | |||||||||||||||
Costs of operations (exclusive of depreciation, amortization and accretion): | |||||||||||||||
Site rental | 241,110 | 181,966 | 706,177 | 538,587 | |||||||||||
Network services and other | 103,023 | 81,998 | 279,344 | 229,574 | |||||||||||
General and administrative | 71,395 | 58,504 | 205,397 | 171,539 | |||||||||||
Asset write-down charges | 5,275 | 3,893 | 11,144 | 10,705 | |||||||||||
Acquisition and integration costs | 4,068 | 4,369 | 28,924 | 13,186 | |||||||||||
Depreciation, amortization and accretion | 254,862 | 195,408 | 759,288 | 572,518 | |||||||||||
Total operating expenses | 679,733 | 526,138 | 1,990,274 | 1,536,109 | |||||||||||
Operating income (loss) | 250,292 | 222,839 | 732,046 | 687,856 | |||||||||||
Interest expense and amortization of deferred financing costs | (141,287 | ) | (142,016 | ) | (432,221 | ) | (446,641 | ) | |||||||
Gains (losses) on retirement of long-term obligations | — | (1 | ) | (44,629 | ) | (36,487 | ) | ||||||||
Interest income | 192 | 236 | 554 | 861 | |||||||||||
Other income (expense) | (678 | ) | (631 | ) | (9,477 | ) | (753 | ) | |||||||
Income (loss) before income taxes | 108,519 | 80,427 | 246,273 | 204,836 | |||||||||||
Benefit (provision) for income taxes | (482 | ) | (33,959 | ) | (86 | ) | (88,254 | ) | |||||||
Net income (loss) | 108,037 | 46,468 | 246,187 | 116,582 | |||||||||||
Less: net income (loss) attributable to the noncontrolling interest | 1,100 | 632 | 3,744 | 2,925 | |||||||||||
Net income (loss) attributable to CCIC stockholders | 106,937 | 45,836 | 242,443 | 113,657 | |||||||||||
Dividends on preferred stock | (10,997 | ) | — | (32,991 | ) | — | |||||||||
Net income (loss) attributable to CCIC common stockholders | $ | 95,940 | $ | 45,836 | $ | 209,452 | $ | 113,657 | |||||||
Net income (loss) attributable to CCIC common stockholders, per common share: | |||||||||||||||
Basic | $ | 0.29 | $ | 0.16 | $ | 0.63 | $ | 0.39 | |||||||
Diluted | $ | 0.29 | $ | 0.16 | $ | 0.63 | $ | 0.39 | |||||||
Weighted-average common shares outstanding (in thousands): | |||||||||||||||
Basic | 332,413 | 290,372 | 332,264 | 290,900 | |||||||||||
Diluted | 333,241 | 291,378 | 333,020 | 292,043 |
News Release continued: | Page 21 |
![]() | CROWN CASTLE INTERNATIONAL CORP. CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED) (in thousands) |
Nine Months Ended September 30, | ||||||||||||
2014 | 2013 | |||||||||||
Cash flows from operating activities: | ||||||||||||
Net income (loss) | $ | 246,187 | $ | 116,582 | ||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities: | ||||||||||||
Depreciation, amortization and accretion | 759,288 | 572,518 | ||||||||||
Gains (losses) on retirement of long-term obligations | 44,629 | 36,487 | ||||||||||
Amortization of deferred financing costs and other non-cash interest | 61,322 | 78,241 | ||||||||||
Stock-based compensation expense | 39,497 | 29,334 | ||||||||||
Asset write-down charges | 11,144 | 10,705 | ||||||||||
Deferred income tax benefit (provision) | (7,512 | ) | 80,999 | |||||||||
Other adjustments, net | (2,088 | ) | 2,167 | |||||||||
Changes in assets and liabilities, excluding the effects of acquisitions: | ||||||||||||
Increase (decrease) in liabilities | 282,619 | 147,721 | ||||||||||
Decrease (increase) in assets | (242,856 | ) | (235,888 | ) | ||||||||
Net cash provided by (used for) operating activities | 1,192,230 | 838,866 | ||||||||||
Cash flows from investing activities: | ||||||||||||
Payments for acquisition of businesses, net of cash acquired | (179,918 | ) | (55,131 | ) | ||||||||
Capital expenditures | (513,552 | ) | (385,482 | ) | ||||||||
Other investing activities, net | 2,787 | 7,601 | ||||||||||
Net cash provided by (used for) investing activities | (690,683 | ) | (433,012 | ) | ||||||||
Cash flows from financing activities: | ||||||||||||
Proceeds from issuance of long-term debt | 845,750 | 830,941 | ||||||||||
Principal payments on debt and other long-term obligations | (86,197 | ) | (77,986 | ) | ||||||||
Purchases and redemptions of long-term debt | (836,899 | ) | (675,481 | ) | ||||||||
Purchases of capital stock | (21,778 | ) | (99,217 | ) | ||||||||
Borrowings under revolving credit facility | 567,000 | 94,000 | ||||||||||
Payments under revolving credit facility | (587,000 | ) | (1,092,000 | ) | ||||||||
Payments for financing costs | (15,899 | ) | (20,753 | ) | ||||||||
Net decrease (increase) in restricted cash | 39,882 | 415,498 | ||||||||||
Dividends/distributions paid on common stock | (350,535 | ) | — | |||||||||
Dividends paid on preferred stock | (33,357 | ) | — | |||||||||
Net cash provided by (used for) financing activities | (479,033 | ) | (624,998 | ) | ||||||||
Effect of exchange rate changes on cash | (7,358 | ) | (3,571 | ) | ||||||||
Net increase (decrease) in cash and cash equivalents | 15,156 | (222,715 | ) | |||||||||
Cash and cash equivalents at beginning of period | 223,394 | 441,364 | ||||||||||
Cash and cash equivalents at end of period | $ | 238,550 | $ | 218,649 | ||||||||
Supplemental disclosure of cash flow information: | ||||||||||||
Interest paid | 368,437 | 356,421 | ||||||||||
Income taxes paid | 15,353 | 12,769 |
TABLE OF CONTENTS | |
Page | |
Company Overview | |
Profile and Strategy | |
Historical Dividend and AFFO per Share | |
Portfolio Footprint | |
Corporate Information | |
Research Coverage | |
Historical Common Stock Data | |
Portfolio and Financial Highlights | |
Outlook - 4Q14, Full Year 2014 and Full Year 2015 | |
Financials & Metrics | |
Consolidated Balance Sheet | |
Consolidated Statement of Operations | |
Segment Operating Results | |
FFO and AFFO Reconciliations | |
Consolidated Statement of Cash Flows | |
Site Rental Revenue Growth | |
Site Rental Gross Margin Growth | |
Summary of Straight-Line, Prepaid Rent Activity, and Capital Expenditures | |
Lease Renewal and Lease Distribution | |
Customer Overview | |
Asset Portfolio Overview | |
Summary of Tower Portfolio by Vintage | |
Portfolio Overview | |
Ground Interest Overview | |
Ground Interest Activity | |
Small Cell Network Overview | |
Capitalization Overview | |
Capitalization Overview | |
Debt Maturity Overview | |
Liquidity Overview | |
Maintenance and Financial Covenants | |
Interest Rate Sensitivity | |
Appendix |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
COMPANY PROFILE |
STRATEGY |
• | Return capital to stockholders in the form of dividends. As a REIT, we are required to distribute at least 90% of our REIT taxable income, after the utilization of our net operating loss carryforwards. We have determined that distributing a meaningful portion of our cash from operations even in advance of exhausting our net operating loss carryforwards, appropriately provides stockholders with increased certainty for a portion of expected long-term stockholder value while still retaining sufficient flexibility to invest in our business and deliver organic growth. We believe this decision reflects the high-quality, long-term contractual cash flow nature of our business translated into stable capital returns to stockholders. |
• | Grow organic cash flows from our wireless infrastructure. We seek to maximize the site rental cash flows derived from our wireless infrastructure by co-locating additional tenants on our wireless infrastructure through long-term contracts as our customers deploy and improve their wireless networks. We seek to maximize new tenant additions or modifications of existing tenant installations (collectively, "new tenant additions") through our focus on customer service and deployment speed. Due to the relatively fixed nature of the costs to operate our wireless infrastructure (which tend to increase at approximately the rate of inflation), we expect increases in site rental cash flows from new tenant additions and the related subsequent impact from contracted escalations to result in growth in our operating cash flows. We believe there is considerable additional future demand for our existing wireless infrastructure based on their location and the anticipated growth in the wireless communications industry. Substantially all of our wireless infrastructure can accommodate additional tenancy, either as currently constructed or with appropriate modifications to the structure, which we expect to have high incremental returns. |
• | Allocate capital efficiently to enhance organic cash flows. We seek to allocate our capital available after payment of dividends, including the net cash provided by our operating activities as well as external financing sources, in a manner that will increase long-term stockholder value on a risk-adjusted basis. Our historical capital allocation mix have included the following (in no particular order): |
▪ | purchase shares of our common stock from time to time; |
▪ | acquire or construct wireless infrastructure; |
▪ | acquire land interests under our towers; |
▪ | make improvements and structural enhancements to our existing wireless infrastructure; or |
▪ | purchase, repay or redeem our debt. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
HISTORICAL DIVIDEND AND AFFO PER SHARE (1) |
GLOBAL FOOTPRINT | ||||
![]() |
U.S. FOOTPRINT | AUSTRALIAN FOOTPRINT | |
![]() | ![]() |
(1) | See reconciliations and definitions provided herein. See also "Definitions of Non-GAAP Financial Measures and Other Calculations" in the Appendix for a discussion of the definitions of FFO and AFFO. |
(2) | Last quarter annualized ("LQA") calculated as the most recently completed quarterly period times four. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
GENERAL COMPANY INFORMATION | |
Principal executive offices | 1220 Augusta Drive, Suite 600, Houston, TX 77057 |
Common shares trading symbol | CCI |
Stock exchange listing | New York Stock Exchange |
Fiscal year ending date | December 31 |
Fitch - Long Term Issuer Default Rating | BB |
Moody’s - Long Term Corporate Family Rating | Ba2 |
Standard & Poor’s - Long Term Local Issuer Credit Rating | BB+ |
EXECUTIVE MANAGEMENT TEAM | |||
Name | Age | Years with Company | Position |
W. Benjamin Moreland | 51 | 14 | President and Chief Executive Officer |
Jay A. Brown | 41 | 15 | Senior Vice President, Chief Financial Officer and Treasurer |
James D. Young | 53 | 8 | Senior Vice President and Chief Operating Officer |
E. Blake Hawk | 64 | 15 | Executive Vice President and General Counsel |
Patrick Slowey | 57 | 14 | Senior Vice President and Chief Commercial Officer |
Philip M. Kelley | 41 | 17 | Senior Vice President-Corporate Development and Strategy |
BOARD OF DIRECTORS | ||||
Name | Position | Committees | Age | Years as Director |
J. Landis Martin | Chairman | NCG(1) | 68 | 17 |
P. Robert Bartolo | Director | Audit | 42 | <1 |
Cindy Christy | Director | NCG(1), Strategy | 48 | 7 |
Ari Q. Fitzgerald | Director | Compensation, Strategy | 51 | 12 |
Robert E. Garrison II | Director | Audit, Compensation | 72 | 9 |
Dale N. Hatfield | Director | NCG(1), Strategy | 76 | 13 |
Lee W. Hogan | Director | Audit, Compensation, Strategy | 70 | 13 |
Edward C. Hutcheson | Director | Strategy | 69 | 18 |
John P. Kelly | Director | Strategy | 56 | 14 |
Robert F. McKenzie | Director | Audit, Strategy | 70 | 19 |
W. Benjamin Moreland | Director | 51 | 8 |
(1) | Nominating & Corporate Governance Committee |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
RESEARCH COVERAGE | ||
Equity Research | ||
Bank of America David Barden (646) 855-1320 | Barclays Amir Rozwadowski (212) 526-4043 | Canaccord Genuity Greg Miller (212) 389-8128 |
Citigroup Michael Rollins (212) 816-1116 | Cowen and Company Colby Synesael (646) 562-1355 | Credit Suisse Joseph Mastrogiovanni (212) 325-3757 |
Evercore Partners Jonathan Schildkraut (212) 497-0864 | Goldman Sachs Brett Feldman (212) 902-8156 | Jefferies Mike McCormack (212) 284-2516 |
JPMorgan Philip Cusick (212) 622-1444 | Macquarie Kevin Smithen (212) 231-0695 | Morgan Stanley Simon Flannery (212) 761-6432 |
New Street Research Jonathan Chaplin (212) 921-9876 | Nomura Adam Ilkowitz (212) 298-4121 | Oppenheimer & Co. Timothy Horan (212) 667-8137 |
Pacific Crest Securities Michael Bowen (503) 727-0721 | Raymond James Ric Prentiss (727) 567-2567 | RBC Capital Markets Jonathan Atkin (415) 633-8589 |
UBS Batya Levi (212) 713-8824 | Wells Fargo Securities, LLC Jennifer Fritzsche (312) 920-3548 | |
Rating Agency | ||
Fitch John Culver (312) 368-3216 | Moody’s Christopher Wimmer (212) 553-2947 | Standard & Poor’s Catherine Cosentino (212) 438-7828 |
HISTORICAL COMMON STOCK DATA | |||||||||||||||
Three Months Ended | |||||||||||||||
(in millions, except per share data) | 9/30/14 | 6/30/14 | 3/31/14 | 12/31/13 | 9/30/13 | ||||||||||
High price(1) | $ | 81.00 | $ | 77.95 | $ | 76.54 | $ | 77.22 | $ | 78.00 | |||||
Low price(1) | $ | 72.53 | $ | 71.29 | $ | 68.44 | $ | 69.87 | $ | 66.73 | |||||
Period end closing price(2) | $ | 80.53 | $ | 73.93 | $ | 73.10 | $ | 72.42 | $ | 72.02 | |||||
Dividends paid per common share | $ | 0.35 | $ | 0.35 | $ | 0.35 | $ | — | $ | — | |||||
Volume weighted average price for the period(1) | $ | 77.09 | $ | 74.23 | $ | 72.26 | $ | 73.25 | $ | 70.67 | |||||
Common shares outstanding - diluted, at period end | 333 | 333 | 333 | 334 | 293 | ||||||||||
Market value of outstanding common shares, at period end(3) | $ | 26,886 | $ | 24,685 | $ | 24,400 | $ | 24,193 | $ | 21,078 |
(1) | Based on the sales price, adjusted for dividends, as reported by Bloomberg. |
(2) | Based on the period end closing price, adjusted for dividends, as reported by Bloomberg. |
(3) | Period end market value of outstanding common shares is calculated as the product of (a) basic shares of common stock outstanding at period end and (b) closing share price at period end, adjusted for dividends, as reported by Bloomberg. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
SUMMARY PORTFOLIO HIGHLIGHTS | ||||||
(as of September 30, 2014) | U.S. | Australia | ||||
Number of towers(1) | 39,644 | 1,769 | ||||
Average number of tenants per tower | 2.3 | 2.3 | ||||
Remaining contracted customer receivables ($ in billions)(2) | $ | 21 | $ | 1 | ||
Weighted average remaining customer contract term (years)(3) | 7 | 10 | ||||
Percent of towers in the Top 50 / 100 Basic Trading Areas | 56% / 71% | Not Applicable | ||||
Percent of ground leased / owned (by site rental gross margin) | 66% / 34% | 87% / 13% | ||||
Weighted average maturity of ground leases (years)(4) | 31 | 18 |
SUMMARY FINANCIAL HIGHLIGHTS | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands, except per share amounts) | 2014 | 2013 | 2014 | 2013 | |||||||||||
Operating Data: | |||||||||||||||
Net revenues | |||||||||||||||
Site rental | $ | 751,893 | $ | 620,766 | $ | 2,245,395 | $ | 1,853,030 | |||||||
Network services and other | 178,132 | 128,211 | 476,925 | 370,935 | |||||||||||
Net revenues | $ | 930,025 | $ | 748,977 | $ | 2,722,320 | $ | 2,223,965 | |||||||
Gross margin | |||||||||||||||
Site rental | $ | 510,783 | $ | 438,800 | $ | 1,539,218 | $ | 1,314,443 | |||||||
Network services and other | 75,109 | 46,213 | 197,581 | 141,361 | |||||||||||
Total gross margin | $ | 585,892 | $ | 485,013 | $ | 1,736,799 | $ | 1,455,804 | |||||||
Net income (loss) attributable to CCIC common stockholders | $ | 95,940 | $ | 45,836 | $ | 209,452 | $ | 113,657 | |||||||
Net income (loss) attributable to CCIC common stockholders per share - diluted | $ | 0.29 | $ | 0.16 | $ | 0.63 | $ | 0.39 | |||||||
Non-GAAP Data(5): | |||||||||||||||
Adjusted EBITDA | $ | 532,955 | $ | 440,557 | $ | 1,590,568 | $ | 1,325,745 | |||||||
FFO(6) | 351,211 | 242,436 | 964,496 | 686,862 | |||||||||||
AFFO | 350,418 | 271,319 | 1,049,687 | 806,768 | |||||||||||
AFFO per share | $ | 1.05 | $ | 0.93 | $ | 3.15 | $ | 2.76 | |||||||
Summary Cash Flow Data: | |||||||||||||||
Net cash provided by (used for) operating activities | $ | 428,554 | $ | 278,839 | $ | 1,192,230 | $ | 838,866 | |||||||
Net cash provided by (used for) investing activities(7) | (292,879 | ) | (157,556 | ) | (690,683 | ) | (433,012 | ) | |||||||
Net cash provided by (used for) financing activities | 123,277 | 28,901 | (479,033 | ) | (624,998 | ) |
(1) | Includes towers and rooftops, excludes small cells and third-party land interests. |
(2) | Excludes renewal terms at customers' opinion. |
(3) | Excludes renewal terms at customers' option, weighted by site rental revenues. |
(4) | Includes renewal terms at the Company's option, weighted by site rental gross margin. |
(5) | See reconciliations and definitions provided herein. See also "Definitions of Non-GAAP Measures and Other Terms" in the Appendix for a discussion of the definition of FFO and AFFO. |
(6) | Calculated to present the periods shown in a manner which is consistent with our commencement of operations as a REIT on January 1, 2014. |
(7) | Includes net cash used for acquisitions of approximately $89 million and $28 million for the three months ended September 30, 2014 and 2013, respectively, and $180 million and $55 million for the nine months ended September 30, 2014 and 2013, respectively. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
SUMMARY FINANCIAL HIGHLIGHTS (CONTINUED) | ||||||||
Three Months Ended September 30, | ||||||||
(dollars in thousands, except per share amounts) | 2014 | 2013 | ||||||
Other Data: | ||||||||
Net debt to last quarter annualized adjusted EBITDA | 5.3x | 6.0x | ||||||
Dividend per common share | $ | 0.35 | $ | — | ||||
AFFO payout ratio(2) | 33 | % | — | |||||
(dollars in thousands) | September 30, 2014 | December 31, 2013 | ||||||
Balance Sheet Data (at period end): | ||||||||
Cash and cash equivalents | $ | 238,550 | $ | 223,394 | ||||
Property and equipment, net | 8,870,817 | 8,947,677 | ||||||
Total assets | 20,784,860 | 20,594,908 | ||||||
Total debt and other long-term obligations | 11,573,678 | 11,594,500 | ||||||
Total CCIC stockholders' equity | 6,844,974 | 6,926,717 |
OUTLOOK FOR FOURTH QUARTER 2014, FULL YEAR 2014 AND FULL YEAR 2015 | |||
(dollars in millions, except per share amounts) | Fourth Quarter 2014 | Full Year 2014 | Full Year 2015 |
Site rental revenues | $755 to $760 | $3,001 to $3,006 | $3,047 to $3,067 |
Site rental cost of operations | $234 to $239 | $940 to $945 | $964 to $979 |
Site rental gross margin | $519 to $524 | $2,058 to $2,063 | $2,073 to $2,093 |
Adjusted EBITDA(2) | $538 to $543 | $2,128 to $2,133 | $2,126 to $2,146 |
Interest expense and amortization of deferred financing costs(1) | $138 to $143 | $571 to $576 | $521 to $536 |
FFO(2) | $353 to $358 | $1,317 to $1,322 | $1,429 to $1,449 |
AFFO(2) | $346 to $351 | $1,396 to $1,401 | $1,437 to $1,457 |
AFFO per share(2)(3) | $1.04 to $1.05 | $4.19 to $4.20 | $4.31 to $4.37 |
Net income (loss) | $97 to $130 | $342 to $375 | $428 to $512 |
Net income (loss) per share - diluted(3) | $0.29 to $0.39 | $1.03 to $1.13 | $1.28 to $1.54 |
Net income (loss) attributable to CCIC common stockholders | $84 to $121 | $300 to $337 | $382 to $474 |
Net income (loss) attributable to CCIC common stockholders per share - diluted(3) | $0.25 to $0.36 | $0.90 to $1.01 | $1.15 to $1.42 |
(1) | See the reconciliation of "components of interest expense and amortization of deferred financing costs" in the Appendix. |
(2) | See reconciliations and definitions provided herein. |
(3) | Based on 333.2 million diluted shares outstanding as of September 30, 2014. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
OUTLOOK FOR FULL YEARS 2014 AND 2015 SITE RENTAL REVENUE GROWTH | |||||||||
(dollars in millions) | Full Year 2013 | Midpoint of Full Year 2014 Outlook | Midpoint of Full Year 2015 Outlook | ||||||
Reported GAAP site rental revenues | $ | 2,504 | $ | 3,004 | $ | 3,057 | |||
Site rental straight-line revenues | (219 | ) | (196 | ) | (137 | ) | |||
Other - Non-recurring | – | (5 | ) | – | |||||
Site Rental Revenues, as Adjusted(1) | $ | 2,285 | $ | 2,803 | $ | 2,921 | |||
Cash adjustments: | |||||||||
FX and other | 10 | 8 | |||||||
New tower acquisitions and builds | (379 | ) | (5 | ) | |||||
Organic Site Rental Revenues(2)(3) | 2,434 | 2,924 | |||||||
Year-Over-Year Revenue Growth | |||||||||
Reported GAAP site rental revenues | 19.9 | % | 1.8 | % | |||||
Site Rental Revenues, as Adjusted | 22.6 | % | 4.2 | % | |||||
Organic Site Rental Revenues(4) | 6.5 | % | 4.3 | % |
OUTLOOK FOR ORGANIC SITE RENTAL REVENUE GROWTH | ||||
Midpoint of Full Year 2014 Outlook | Midpoint of Full Year 2015 Outlook | |||
New leasing activity | 5.5 | % | 5.1 | % |
Escalators | 3.6 | % | 3.3 | % |
Organic Site Rental Revenue Growth, before non-renewals | 9.1 | % | 8.5 | % |
Non-renewals | (2.6 | )% | (4.2 | )% |
Organic Site Rental Revenue Growth(4) | 6.5 | % | 4.3 | % |
OUTLOOK FOR FULL YEARS 2014 AND 2015 SITE RENTAL GROSS MARGIN GROWTH | |||||||||
(dollars in millions) | Full Year 2013 | Midpoint of Full Year 2014 Outlook | Midpoint of Full Year 2015 Outlook | ||||||
Reported GAAP site rental gross margin | $ | 1,779 | $ | 2,061 | $ | 2,083 | |||
Straight line revenues and expenses, net | (138 | ) | (91 | ) | (42 | ) | |||
Other - Non-recurring | – | (5 | ) | – | |||||
Site Rental Gross Margin, as Adjusted(1) | $ | 1,640 | $ | 1,964 | $ | 2,041 | |||
Cash adjustments: | |||||||||
FX and other | 7 | 6 | |||||||
New tower acquisitions and builds | (220 | ) | (3 | ) | |||||
Organic Site Rental Gross Margin(2)(3) | $ | 1,751 | $ | 2,044 | |||||
Year-Over-Year Gross Margin Growth | |||||||||
Reported GAAP site rental gross margin | 15.9 | % | 1.1 | % | |||||
Site Rental Gross Margin, as Adjusted | 19.7 | % | 3.9 | % | |||||
Organic Site Rental Gross Margin(5) | 6.8 | % | 4.1 | % | |||||
Year-Over-Year Incremental Margin | |||||||||
Reported GAAP site rental gross margin | 56.5 | % | 42.1 | % | |||||
Site Rental Gross Margin, as Adjusted | 62.5 | % | 65.5 | % | |||||
Organic Site Rental Gross Margin(6) | 74.7 | % | 66.2 | % |
(1) | Includes amortization of prepaid rent. |
(2) | Includes Site Rental Revenues, as Adjusted, from the construction of new small cell nodes. |
(3) | See definitions provided herein. |
(4) | Calculated as the percentage change from Site Rental Revenues, as Adjusted, for the prior period when compared to Organic Site Rental Revenues for the current period. |
(5) | Calculated as the percentage change from Site Rental Gross Margin, as Adjusted for the prior period when compared to Organic Site Rental Gross Margin in the current period. |
(6) | Calculated as the change from Site Rental Gross Margin, as Adjusted for the prior period when compared to Organic Site Rental Gross Margin in the current period, divided by the change from Site Rental Revenues, as Adjusted in the prior period when compared to Organic Site Rental Revenues for the current period. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
CONSOLIDATED BALANCE SHEET (Unaudited) | |||||||
(dollars in thousands, except share amounts) | September 30, 2014 | December 31, 2013 | |||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 238,550 | $ | 223,394 | |||
Restricted cash | 137,824 | 183,526 | |||||
Receivables, net | 311,798 | 249,925 | |||||
Prepaid expenses | 154,240 | 132,003 | |||||
Deferred income tax assets | 40,201 | 26,714 | |||||
Other current assets | 96,182 | 77,121 | |||||
Total current assets | 978,795 | 892,683 | |||||
Deferred site rental receivables | 1,220,050 | 1,078,995 | |||||
Property and equipment, net | 8,870,817 | 8,947,677 | |||||
Goodwill | 5,091,800 | 4,916,426 | |||||
Other intangible assets, net | 3,795,426 | 4,057,865 | |||||
Deferred income tax assets | 10,855 | 19,008 | |||||
Long-term prepaid rent, deferred financing costs and other assets, net | 817,117 | 682,254 | |||||
Total assets | $ | 20,784,860 | $ | 20,594,908 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 175,110 | $ | 145,390 | |||
Accrued interest | 68,044 | 65,582 | |||||
Deferred revenues | 327,265 | 260,114 | |||||
Other accrued liabilities | 168,475 | 181,715 | |||||
Current maturities of debt and other obligations | 106,673 | 103,586 | |||||
Total current liabilities | 845,567 | 756,387 | |||||
Debt and other long-term obligations | 11,467,005 | 11,490,914 | |||||
Deferred income tax liabilities | 57,118 | 56,513 | |||||
Deferred credits and other liabilities | 1,552,425 | 1,349,919 | |||||
Total liabilities | 13,922,115 | 13,653,733 | |||||
Commitments and contingencies | |||||||
CCIC stockholders' equity: | |||||||
Common stock, $.01 par value; 600,000,000 shares authorized; shares issued and outstanding: September 30, 2014—333,859,447 and December 31, 2013—334,070,016 | 3,339 | 3,341 | |||||
4.50% Mandatory Convertible Preferred Stock, Series A, $.01 par value; 20,000,000 shares authorized; shares issued and outstanding: September 30, 2014 and December 31, 2013—9,775,000; aggregate liquidation value: September 30, 2014 and December 31, 2013—$977,500 | 98 | 98 | |||||
Additional paid-in capital | 9,500,490 | 9,482,769 | |||||
Accumulated other comprehensive income (loss) | 19,006 | (23,612 | ) | ||||
Dividends/distributions in excess of earnings | (2,677,959 | ) | (2,535,879 | ) | |||
Total CCIC stockholders' equity | 6,844,974 | 6,926,717 | |||||
Noncontrolling interest | 17,771 | 14,458 | |||||
Total equity | 6,862,745 | 6,941,175 | |||||
Total liabilities and equity | $ | 20,784,860 | $ | 20,594,908 |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands, except share and per share amounts) | 2014 | 2013 | 2014 | 2013 | |||||||||||
Net revenues: | |||||||||||||||
Site rental | $ | 751,893 | $ | 620,766 | $ | 2,245,395 | $ | 1,853,030 | |||||||
Network services and other | 178,132 | 128,211 | 476,925 | 370,935 | |||||||||||
Net revenues | 930,025 | 748,977 | 2,722,320 | 2,223,965 | |||||||||||
Operating expenses: | |||||||||||||||
Costs of operations (exclusive of depreciation, amortization and accretion): | |||||||||||||||
Site rental | 241,110 | 181,966 | 706,177 | 538,587 | |||||||||||
Network services and other | 103,023 | 81,998 | 279,344 | 229,574 | |||||||||||
General and administrative | 71,395 | 58,504 | 205,397 | 171,539 | |||||||||||
Asset write-down charges | 5,275 | 3,893 | 11,144 | 10,705 | |||||||||||
Acquisition and integration costs | 4,068 | 4,369 | 28,924 | 13,186 | |||||||||||
Depreciation, amortization and accretion | 254,862 | 195,408 | 759,288 | 572,518 | |||||||||||
Total operating expenses | 679,733 | 526,138 | 1,990,274 | 1,536,109 | |||||||||||
Operating income (loss) | 250,292 | 222,839 | 732,046 | 687,856 | |||||||||||
Interest expense and amortization of deferred financing costs | (141,287 | ) | (142,016 | ) | (432,221 | ) | (446,641 | ) | |||||||
Gains (losses) on retirement of long-term obligations | — | (1 | ) | (44,629 | ) | (36,487 | ) | ||||||||
Interest income | 192 | 236 | 554 | 861 | |||||||||||
Other income (expense) | (678 | ) | (631 | ) | (9,477 | ) | (753 | ) | |||||||
Income (loss) before income taxes | 108,519 | 80,427 | 246,273 | 204,836 | |||||||||||
Benefit (provision) for income taxes | (482 | ) | (33,959 | ) | (86 | ) | (88,254 | ) | |||||||
Net income (loss) | 108,037 | 46,468 | 246,187 | 116,582 | |||||||||||
Less: net income (loss) attributable to the noncontrolling interest | 1,100 | 632 | 3,744 | 2,925 | |||||||||||
Net income (loss) attributable to CCIC stockholders | 106,937 | 45,836 | 242,443 | 113,657 | |||||||||||
Dividends on preferred stock | (10,997 | ) | — | (32,991 | ) | — | |||||||||
Net income (loss) attributable to CCIC common stockholders | $ | 95,940 | $ | 45,836 | $ | 209,452 | $ | 113,657 | |||||||
Net income (loss) attributable to CCIC common stockholders, per common share: | |||||||||||||||
Basic | $ | 0.29 | $ | 0.16 | $ | 0.63 | $ | 0.39 | |||||||
Diluted | $ | 0.29 | $ | 0.16 | $ | 0.63 | $ | 0.39 | |||||||
Weighted-average common shares outstanding (in thousands): | |||||||||||||||
Basic | 332,413 | 290,372 | 332,264 | 290,900 | |||||||||||
Diluted | 333,241 | 291,378 | 333,020 | 292,043 |
(1) | Exclusive of depreciation, amortization and accretion shown separately |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
SEGMENT OPERATING RESULTS | |||||||||||
Three Months Ended September 30, 2014 | |||||||||||
(dollars in thousands) | CCUSA | CCAL | Consolidated Total | ||||||||
Net Revenues | |||||||||||
Site rental | $ | 717,623 | $ | 34,270 | $ | 751,893 | |||||
Services | 175,260 | 2,872 | 178,132 | ||||||||
Total net revenues | 892,883 | 37,142 | 930,025 | ||||||||
Operating expenses(1) | |||||||||||
Site rental | 230,599 | 10,511 | 241,110 | ||||||||
Services | 101,814 | 1,209 | 103,023 | ||||||||
Total operating expenses | 332,413 | 11,720 | 344,133 | ||||||||
General and administrative | 65,212 | 6,183 | 71,395 | ||||||||
Adjusted EBITDA | $ | 513,604 | $ | 19,351 | $ | 532,955 |
FFO AND AFFO RECONCILIATIONS | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands, except share and per share amounts) | 2014 | 2013 | 2014 | 2013 | |||||||||||
Net income | $ | 108,037 | $ | 46,468 | $ | 246,187 | $ | 116,582 | |||||||
Real estate related depreciation, amortization and accretion | 249,994 | 192,707 | 743,898 | 562,501 | |||||||||||
Asset write-down charges | 5,275 | 3,893 | 11,144 | 10,705 | |||||||||||
Adjustment for noncontrolling interest(2) | (1,100 | ) | (632 | ) | (3,744 | ) | (2,925 | ) | |||||||
Dividends on preferred stock | (10,997 | ) | — | (32,991 | ) | — | |||||||||
FFO(3) | $ | 351,211 | $ | 242,436 | $ | 964,496 | $ | 686,862 | |||||||
Weighted average common shares outstanding — diluted | 333,241 | 291,378 | 333,020 | 292,043 | |||||||||||
FFO per share(3) | $ | 1.05 | $ | 0.83 | $ | 2.90 | $ | 2.35 | |||||||
FFO (from above) | $ | 351,211 | $ | 242,436 | $ | 964,496 | $ | 686,862 | |||||||
Adjustments to increase (decrease) FFO: | |||||||||||||||
Straight-line revenue | (46,752 | ) | (53,294 | ) | (149,692 | ) | (169,612 | ) | |||||||
Straight-line expense | 24,954 | 20,604 | 78,750 | 61,883 | |||||||||||
Stock-based compensation expense | 13,470 | 10,178 | 44,620 | 29,885 | |||||||||||
Non-cash portion of tax provision(4) | (2,628 | ) | 32,510 | (7,513 | ) | 83,318 | |||||||||
Non-real estate related depreciation, amortization and accretion | 4,868 | 2,701 | 15,389 | 10,017 | |||||||||||
Amortization of non-cash interest expense | 19,837 | 20,771 | 61,322 | 78,242 | |||||||||||
Other (income) expense | 678 | 631 | 9,477 | 753 | |||||||||||
Gains (losses) on retirement of long-term obligations | — | 1 | 44,629 | 36,487 | |||||||||||
Acquisition and integration costs | 4,068 | 4,369 | 28,924 | 13,186 | |||||||||||
Adjustment for noncontrolling interest(2) | 1,100 | 632 | 3,744 | 2,925 | |||||||||||
Capital improvement capital expenditures | (7,911 | ) | (3,741 | ) | (16,240 | ) | (9,454 | ) | |||||||
Corporate capital expenditures | (12,474 | ) | (6,478 | ) | (28,216 | ) | (17,724 | ) | |||||||
AFFO(3) | $ | 350,418 | $ | 271,319 | $ | 1,049,687 | $ | 806,768 | |||||||
Weighted average common shares outstanding — diluted | 333,241 | 291,378 | 333,020 | 292,043 | |||||||||||
AFFO per share(3) | $ | 1.05 | $ | 0.93 | $ | 3.15 | $ | 2.76 |
(2) | Inclusive of the noncontrolling interest related to real estate related depreciation, amortization and accretion and asset write-downs. |
(3) | See reconciliations and definitions provided herein. See also "Definitions of Non-GAAP Measures and Other Calculations"in the Appendix for a discussion of the definitions of FFO and AFFO. |
(4) | Adjusts the income tax provision for 2013 to reflect our estimate of the cash taxes had we been a REIT, which predominately relates to foreign taxes paid. As a result, income tax expense (benefit) is lower by the amount of the adjustment. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) | ||||||||||||
Nine Months Ended September 30, | ||||||||||||
(dollars in thousands) | 2014 | 2013 | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net income (loss) | $ | 246,187 | $ | 116,582 | ||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities: | ||||||||||||
Depreciation, amortization and accretion | 759,288 | 572,518 | ||||||||||
Gains (losses) on retirement of long-term obligations | 44,629 | 36,487 | ||||||||||
Amortization of deferred financing costs and other non-cash interest | 61,322 | 78,241 | ||||||||||
Stock-based compensation expense | 39,497 | 29,334 | ||||||||||
Asset write-down charges | 11,144 | 10,705 | ||||||||||
Deferred income tax benefit (provision) | (7,512 | ) | 80,999 | |||||||||
Other adjustments, net | (2,088 | ) | 2,167 | |||||||||
Changes in assets and liabilities, excluding the effects of acquisitions: | ||||||||||||
Increase (decrease) in liabilities | 282,619 | 147,721 | ||||||||||
Decrease (increase) in assets | (242,856 | ) | (235,888 | ) | ||||||||
Net cash provided by (used for) operating activities | 1,192,230 | 838,866 | ||||||||||
Cash flows from investing activities: | ||||||||||||
Payments for acquisition of businesses, net of cash acquired | (179,918 | ) | (55,131 | ) | ||||||||
Capital expenditures | (513,552 | ) | (385,482 | ) | ||||||||
Other investing activities, net | 2,787 | 7,601 | ||||||||||
Net cash provided by (used for) investing activities | (690,683 | ) | (433,012 | ) | ||||||||
Cash flows from financing activities: | ||||||||||||
Proceeds from issuance of long-term debt | 845,750 | 830,941 | ||||||||||
Principal payments on debt and other long-term obligations | (86,197 | ) | (77,986 | ) | ||||||||
Purchases and redemptions of long-term debt | (836,899 | ) | (675,481 | ) | ||||||||
Purchases of capital stock | (21,778 | ) | (99,217 | ) | ||||||||
Borrowings under revolving credit facility | 567,000 | 94,000 | ||||||||||
Payments under revolving credit facility | (587,000 | ) | (1,092,000 | ) | ||||||||
Payments for financing costs | (15,899 | ) | (20,753 | ) | ||||||||
Net decrease (increase) in restricted cash | 39,882 | 415,498 | ||||||||||
Dividends/distributions paid on common stock | (350,535 | ) | — | |||||||||
Dividends paid on preferred stock | (33,357 | ) | — | |||||||||
Net cash provided by (used for) financing activities | (479,033 | ) | (624,998 | ) | ||||||||
Effect of exchange rate changes on cash | (7,358 | ) | (3,571 | ) | ||||||||
Net increase (decrease) in cash and cash equivalents | 15,156 | (222,715 | ) | |||||||||
Cash and cash equivalents at beginning of period | 223,394 | 441,364 | ||||||||||
Cash and cash equivalents at end of period | $ | 238,550 | $ | 218,649 | ||||||||
Supplemental disclosure of cash flow information: | ||||||||||||
Interest paid | 368,437 | 356,421 | ||||||||||
Income taxes paid | 15,353 | 12,769 |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
SITE RENTAL REVENUE GROWTH | |||||||
Three Months Ended September 30, | |||||||
(dollars in millions) | 2014 | 2013 | |||||
Beginning towers as of September 30, 2013 | 31,619 | ||||||
Net tower additions/(dispositions) | 9,795 | ||||||
Ending towers as of September 30, 2014 | 41,414 | ||||||
Reported GAAP site rental revenues | $ | 752 | $ | 621 | |||
Site rental straight-line revenues | (47 | ) | (53 | ) | |||
Site Rental Revenues, as Adjusted(1) | $ | 705 | $ | 567 | |||
Cash adjustments: | |||||||
FX and other | 0 | ||||||
New tower acquisitions and builds | (98 | ) | |||||
Organic Site Rental Revenues(2)(3) | $ | 607 | |||||
Year-Over-Year Revenue Growth | |||||||
Reported GAAP site rental revenues | 21.1 | % | |||||
Site Rental Revenues, as Adjusted | 24.3 | % | |||||
Organic Site Rental Revenues(4) | 7.0 | % |
ORGANIC SITE RENTAL REVENUE GROWTH | |
Three Months Ended September 30, | |
2014 | |
New leasing activity | 6.3% |
Escalators | 3.7% |
Organic Site Rental Revenue growth, before non-renewals | 10.0% |
Non-renewals | (3.0)% |
Organic Site Rental Revenue Growth(4) | 7.0% |
(1) | Includes amortization of prepaid rent; see the table “Summary of Prepaid Rent Activity” on page 16 for further details. |
(2) | Includes Site Rental Revenues, as Adjusted from the construction of new small cell nodes. |
(3) | See definitions provided herein. |
(4) | Calculated as the percentage change from Site Rental Revenues, as Adjusted, for the prior period when compared to Organic Site Rental Revenues for the current period. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
SITE RENTAL GROSS MARGIN GROWTH | |||||||
Three Months Ended September 30, | |||||||
(dollars in millions) | 2014 | 2013 | |||||
Reported GAAP site rental gross margin | $ | 511 | $ | 439 | |||
Straight line revenues and expenses, net | (22 | ) | (33 | ) | |||
Site rental gross margin, as adjusted | $ | 489 | $ | 406 | |||
Cash adjustments: | |||||||
FX and other | (0) | ||||||
New tower acquisitions and builds | (56 | ) | |||||
Organic Site Rental Gross Margin(1)(2) | $ | 432 | |||||
Year-Over-Year Gross Margin Growth | |||||||
Reported GAAP site rental gross margin | 16.4 | % | |||||
Site Rental Gross Margin, as Adjusted | 20.4 | % | |||||
Organic Site Rental Gross Margin(3) | 6.5 | % | |||||
Year-Over-Year Incremental Margin | |||||||
Reported GAAP site rental gross margin | 54.9 | % | |||||
Site Rental Gross Margin, as Adjusted | 60.2 | % | |||||
Organic Site Rental Gross Margin(4) | 66.7 | % |
(1) | Includes Site Rental Revenues, as Adjusted, from the construction of new small cell nodes. |
(2) | See definitions provided herein. |
(3) | Calculated as the percentage change from Site Rental Gross Margin, as Adjusted for the prior period when compared to Organic Site Rental Gross Margin in the current period. |
(4) | Calculated as the change from Site Rental Gross Margin, as Adjusted for the prior period when compared to Organic Site Rental Gross Margin in the current period, divided by the change from Site Rental Revenues, as Adjusted in the prior period when compared to Organic Site Rental Revenues for the current period. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
SUMMARY OF SITE RENTAL STRAIGHT-LINE REVENUES AND EXPENSES(1) | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||
Total site rental straight-line revenue | $ | 46,752 | $ | 53,294 | $ | 149,692 | $ | 169,612 | |||||||
Total site rental straight-line expenses | 24,954 | 20,604 | 78,750 | 61,883 |
SUMMARY OF PREPAID RENT ACTIVITY(2) | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||
Prepaid rent received | $ | 81,240 | $ | 63,940 | $ | 233,070 | $ | 153,630 | |||||||
Amortization of prepaid rent | (27,541 | ) | (17,105 | ) | (69,055 | ) | (47,057 | ) |
SUMMARY OF CAPITAL EXPENDITURES | |||||||
Three Months Ended September 30, | |||||||
(dollars in thousands) | 2014 | 2013 | |||||
Discretionary: | |||||||
Purchases of land interests | $ | 16,460 | $ | 17,632 | |||
Wireless infrastructure construction and improvements | 166,967 | 102,811 | |||||
Sustaining | 20,385 | 10,219 | |||||
Total | $ | 203,812 | $ | 130,662 |
(1) | In accordance with GAAP accounting, if payment terms call for fixed escalations, or rent free periods, the revenue is recognized on a straight-line basis over the fixed, non-cancelable term of the contract. Since the Company recognizes revenue on a straight-line basis, a portion of the site rental revenue in a given period represents cash collected or contractually collectible in other periods. |
(2) | Reflects prepaid rent received from long-term tenant contracts and the amortization thereof for GAAP revenue recognition purposes. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
PROJECTED REVENUE FROM EXISTING CUSTOMER CONTRACTS(1) | |||||||||||||||
Remaining three months | Years Ended December 31, | ||||||||||||||
(dollars in millions) | 2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||
Site rental revenue (GAAP) | $ | 750 | $ | 2,967 | $ | 2,976 | $ | 3,000 | $ | 3,024 | |||||
Site rental straight-line revenue | (45 | ) | (128 | ) | (51 | ) | 16 | 69 | |||||||
Site Rental Revenues, as Adjusted | $ | 705 | $ | 2,839 | $ | 2,925 | $ | 3,016 | $ | 3,093 |
PROJECTED GROUND LEASE EXPENSE FROM EXISTING GROUND LEASES(2) | |||||||||||||||
Remaining three months | Years Ended December 31, | ||||||||||||||
(as of September 30, 2014; dollars in millions) | 2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||
Ground lease expense (GAAP) | $ | 169 | $ | 677 | $ | 683 | $ | 690 | $ | 697 | |||||
Site rental straight-line expense | (24 | ) | (90 | ) | (77 | ) | (65 | ) | (55 | ) | |||||
Ground Lease Expense, as Adjusted | $ | 144 | $ | 588 | $ | 606 | $ | 625 | $ | 642 |
ANNUALIZED CASH SITE RENTAL REVENUE AT TIME OF RENEWAL(3) | |||||||||||||||
Remaining three months | Years Ended December 31, | ||||||||||||||
(as of September 30, 2014; dollars in millions) | 2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||
AT&T | $ | 3 | $ | 27 | $ | 46 | $ | 21 | $ | 40 | |||||
Sprint(4) | 5 | 27 | 43 | 40 | 39 | ||||||||||
T-Mobile | 2 | 13 | 33 | 25 | 33 | ||||||||||
Verizon | 2 | 11 | 12 | 16 | 18 | ||||||||||
Optus | — | 2 | — | — | — | ||||||||||
VHA | — | 1 | 7 | 10 | 2 | ||||||||||
Telstra | — | 2 | 4 | 2 | 1 | ||||||||||
All Others Combined | 10 | 46 | 38 | 29 | 31 | ||||||||||
Total | $ | 23 | $ | 129 | $ | 184 | $ | 143 | $ | 164 |
(1) | Based on existing contracts as of September 30, 2014. All contracts, except for Sprint contracts associated with the iDen network and contracts where non-renewal notices have been received, are assumed to renew for a new term at current term end date. CPI-linked customer contracts are assumed to escalate at 3% per annum. Assumes a US dollar to Australian dollar exchange rate of 0.93 US dollar to 1.0 Australian dollar. |
(2) | Based on existing ground leases as of September 30, 2014. CPI-linked leases are assumed to escalate at 3% per annum. Assumes a US dollar to Australian dollar exchange rate of 0.93 US dollar to 1.0 Australian dollar. |
(3) | Reflects lease renewals by year by customer; dollar amounts represent annualized cash site rental revenues from assumed renewals or extension as reflected in the table "Projected Revenue from Existing Customer Contracts." |
(4) | Excludes Sprint leases associated with the iDen network, which are assumed to not renew as reflected in the table "Projected Revenue from Existing Customer Contracts." |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
ESTIMATED REDUCTION TO SITE RENTAL REVENUES FROM NON-RENEWALS FROM LEAP, METROPCS AND CLEARWIRE NETWORK DECOMMISSIONING(1)(2) (dollars in millions) | |||||
2015 | 2016 | 2017 | 2018 | Thereafter | Total |
$35-$45 | $60-$70 | $25-$35 | $20-$30 | $35-$45 | $175-$225 |
TOTAL SITE RENTAL REVENUES FROM LEAP, METROPCS AND CLEARWIRE BY LEASE MATURITY(1) | ||||||
(dollars in millions) | 2015 | 2016 | 2017 | 2018 | Thereafter | Total |
Towers Leasing | $70 | $70 | $45 | $30 | $45 | $260 |
Small Cells Leasing | $— | $5 | $5 | $5 | $80 | $95 |
Total | $70 | $75 | $50 | $35 | $125 | $355 |
HISTORICAL ANNUAL NON-RENEWALS AS PERCENTAGE OF SITE RENTAL REVENUES, AS ADJUSTED | ||||
Years Ended December 31, | ||||
2013 | 2012 | 2011 | 2010 | 2009 |
1.7% | 2.2% | 1.9% | 2.0% | 2.6% |
CUSTOMER OVERVIEW | |||||
(as of September 30, 2014) | Percentage of Q3 2014 LQA Site Rental Revenues | Weighted Average Current Term Remaining(3) | Long-Term Credit Rating (S&P / Moody’s) | ||
AT&T | 29 | % | 8 | A- / A3 | |
T-Mobile | 23 | % | 7 | BB | |
Sprint | 21 | % | 6 | BB- / Ba3 | |
Verizon | 15 | % | 9 | BBB+ / Baa1 | |
Optus Communications | 1 | % | 15 | A+ / Aa3 | |
VHA | 1 | % | 5 | A- / A3(4) | |
Telstra | 1 | % | 12 | A / A2 | |
All Others Combined | 8 | % | 4 | N/A | |
Total / Weighted Average | 100 | % | 7 |
(1) | Figures are approximate and based on run-rate site rental revenues as of September 30, 2014. |
(2) | Depending on the eventual network deployment and decommissioning plans of AT&T, T-Mobile and Sprint, the impact and timing of such renewals may vary from Crown Castle's expectations. |
(3) | Weighted by site rental revenue contributions; excludes renewals at the customers' option. |
(4) | Vodafone Hutchison Australia ("VHA") is a joint venture between Vodafone Group Plc and Hutchison Telecommunications Australia, a subsidiary of Hutchison Whompoa; Vodafone Group Plc and Hutchison Whompoa each are rated A- and A3 by S&P and Moody's, respectively, as of September 30, 2014. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
SUMMARY OF TOWER PORTFOLIO BY VINTAGE | |
(as of September 30, 2014; dollars in thousands) | |
YIELD(1) | NUMBER OF TENANTS PER TOWER |
LQA SITE RENTAL REVENUE PER TOWER | LQA SITE RENTAL GROSS MARGIN PER TOWER |
INVESTED CAPITAL PER TOWER(2) | NUMBER OF TOWERS |
(1) | Yield is calculated as LQA site rental gross margin divided by invested capital. |
(2) | Reflects gross total assets, including incremental capital invested by the Company since time of acquisition or construction completion. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
PORTFOLIO OVERVIEW(1) | ||
(as of September 30, 2014; dollars in thousands) | ||
NUMBER OF TOWERS | TENANTS PER TOWER | LQA SITE RENTAL REVENUE PER TOWER |
(1) | Includes towers and rooftops, excludes small cells and third-party land interests. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
DISTRIBUTION OF TOWER TENANCY (as of September 30, 2014) | |||||
PERCENTAGE OF TOWERS BY TENANTS PER TOWER(1) | |||||
U.S. PORTFOLIO | AUSTRALIA PORTFOLIO |
Average: 2.3 | Average: 2.3 |
GEOGRAPHIC TOWER DISTRIBUTION (as of September 30, 2014)(1) | |
PERCENTAGE OF TOWERS BY GEOGRAPHIC LOCATION | PERCENTAGE OF LQA SITE RENTAL REVENUE BY GEOGRAPHIC LOCATION |
(1) | Includes towers and rooftops, excludes small cells and third-party land interests. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
U.S. GROUND INTEREST OVERVIEW | ||||||||||||||||
(as of September 30, 2014; dollars in millions) | LQA Site Rental Revenue | Percentage of U.S. LQA Site Rental Revenue | LQA Site Rental Gross Margin | Percentage of U.S. LQA Site Rental Gross Margin | Number of U.S. Towers(1) | Percentage of U.S. Towers | Weighted Average Term Remaining (by years)(2) | |||||||||
Less than 10 years | $ | 342 | 13 | % | $ | 192 | 11 | % | 5,816 | 15 | % | |||||
10 to 20 years | 545 | 21 | % | 296 | 16 | % | 10,322 | 26 | % | |||||||
Greater 20 years | 1,054 | 40 | % | 685 | 38 | % | 15,609 | 39 | % | |||||||
Total leased | $ | 1,941 | 74 | % | $ | 1,173 | 65 | % | 31,747 | 80 | % | 31 | ||||
Owned | 683 | 26 | % | 629 | 35 | % | 7,897 | 20 | % | |||||||
Total / Average | $ | 2,624 | 100 | % | $ | 1,802 | 100 | % | 39,644 | 100 | % |
AUSTRALIA GROUND INTEREST OVERVIEW | ||||||||||||||||
(as of September 30, 2014; dollars in millions) | LQA Site Rental Revenue | Percentage of Australia LQA Site Rental Revenue | LQA Site Rental Gross Margin | Percentage of Australia LQA Site Rental Gross Margin | Number of Australia Towers(1) | Percentage of Australia Towers | Weighted Average Term Remaining (by years)(2) | |||||||||
Less than 10 years | $ | 42 | 32 | % | $ | 28 | 28 | % | 561 | 32 | % | |||||
10 to 20 years | 42 | 32 | % | 32 | 32 | % | 547 | 31 | % | |||||||
Greater 20 years | 35 | 27 | % | 27 | 27 | % | 520 | 29 | % | |||||||
Total leased | $ | 119 | 90 | % | $ | 87 | 87 | % | 1,628 | 92 | % | 18 | ||||
Owned | 13 | 10 | % | 13 | 13 | % | 141 | 8 | % | |||||||
Total / Average | $ | 132 | 100 | % | $ | 100 | 100 | % | 1,769 | 100 | % |
(1) | Includes towers and rooftops, excludes small cells and third-party land interests. |
(2) | Includes renewal terms at the Company’s option; weighted by site rental gross margin. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
U.S. GROUND INTEREST ACTIVITY | ||||||
(dollars in millions) | Three Months Ended September 30, 2014 | Nine Months Ended September 30, 2014 | ||||
Ground Extensions Under Crown Castle Towers: | ||||||
Number of ground leases extended | 453 | 1,152 | ||||
Average number of years extended | 32 | 28 | ||||
Percentage increase in consolidated cash ground lease expense due to extension activities(1) | 0.1 | % | 0.4 | % | ||
Ground Purchases Under Crown Castle Towers: | ||||||
Number of ground leases purchased | 143 | 394 | ||||
Land lease purchases (including capital expenditures, acquisitions and capital leases) | $ | 29 | $ | 91 | ||
Percentage of consolidated site rental gross margin from towers residing on land purchased | <1% | 1 | % |
AUSTRALIA GROUND INTEREST ACTIVITY | ||||||
(dollars in millions) | Three Months Ended September 30, 2014 | Nine Months Ended September 30, 2014 | ||||
Ground Extensions Under Crown Castle Towers: | ||||||
Number of ground leases extended | 51 | 81 | ||||
Average number of years extended | 13 | 14 | ||||
Percentage increase in consolidated cash ground lease expense due to extension activities(1) | Not Meaningful | Not Meaningful | ||||
Ground Purchases Under Crown Castle Towers: | ||||||
Number of ground leases purchased | 2 | 8 | ||||
Land lease purchases (including capital expenditures, acquisitions and capital leases) | $ | 1 | $ | 5 | ||
Percentage of consolidated site rental gross margin from towers residing on land purchased | Not Meaningful | Not Meaningful |
SMALL CELL NETWORK OVERVIEW | |||
Number of Nodes(3) (in thousands) | Miles of Fiber (in thousands) | Percentage of LQA Site Rental Revenues | Weighted Average Current Term Remaining for Customer Contracts(2) |
14 | 6 | 7% | 8 |
(1) | Includes the impact from the amortization of lump sum payments. |
(2) | Excludes renewal terms at customers’ option; weighted by site rental revenue. |
(3) | Includes nodes currently in-process. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
CAPITALIZATION OVERVIEW | ||||||||
(dollars in millions) | Face Value as Reported 9/30/14 | Fixed vs. Floating | Secured vs. Unsecured | Interest Rate(1) | Net Debt to LQA EBITDA(2) | Maturity | ||
Cash | $ | 239 | ||||||
Senior Secured Tower Revenue Notes, Series 2010-2-2010-3(3) | 1,600 | Fixed | Secured | 5.98% | Various(8) | |||
Senior Secured Tower Revenue Notes, Series 2010-4-2010-6(3) | 1,550 | Fixed | Secured | 4.48% | Various(8) | |||
2012 Secured Notes(4) | 1,500 | Fixed | Secured | 3.36% | 2017/2023 | |||
Senior Secured Notes, Series 2009-1(5) | 166 | Fixed | Secured | 7.41% | Various(8) | |||
WCP Secured Wireless Site Contracts Revenue Notes, Series 2010-1(6) | 264 | Fixed | Secured | 5.67% | 2040 | |||
Subtotal | $ | 5,079 | 4.78% | 2.4x | ||||
Revolving Credit Facility(7) | 354 | Floating | Secured | 1.91% | 2018/2019 | |||
Term Loan A | 650 | Floating | Secured | 1.90% | 2018/2019 | |||
Term Loan B | 2,843 | Floating | Secured | 3.00% | 2019/2021(9) | |||
Total CCOC Facility Debt | $ | 3,847 | 2.71% | 1.8x | ||||
4.875% Senior Notes | 850 | Fixed | Unsecured | 4.88% | 2022 | |||
5.250% Senior Notes | 1,650 | Fixed | Unsecured | 5.25% | 2023 | |||
Capital Leases & Other Debt | 147 | Various | Various | Various | Various | |||
Total HoldCo and other Debt | $ | 2,647 | 5.12% | 1.2x | ||||
Total Net Debt | $ | 11,335 | 4.16% | 5.3x | ||||
Preferred Stock, at liquidation value | 978 | |||||||
Market Capitalization(10) | 26,886 | |||||||
Firm Value(11) | $ | 39,198 |
(1) | Represents the weighted-average stated interest rate. |
(2) | Represents the applicable amount of debt divided by LQA consolidated Adjusted EBITDA. |
(3) | If the Senior Secured Tower Revenue Notes 2010-2, and 2010-3 and Senior Secured Tower Revenue Notes, 2010-4, 2010-5, and 2010-6 (“2010 Tower Revenue Notes”) are not paid in full on or prior to 2015, 2017 and 2020, as applicable, then Excess Cash Flow (as defined in the indenture) of the issuers (of such notes) will be used to repay principal of the applicable series and class of the 2010 Tower Revenue Notes, and additional interest (of an additional approximately 5% per annum) will accrue on the respective 2010 Tower Revenue Notes. The Senior Secured Tower Revenue Notes, 2010-2, and 2010-3 consist of two series of notes with principal amounts of $350 million and $1.3 billion, having anticipated repayment dates in 2017 and 2020, respectively. The Senior Secured Tower Revenue Notes, 2010-4, 2010-5, and 2010-6 consist of three series of notes with principal amounts of $250 million, $300 million and $1.0 billion, having anticipated repayment dates in 2015, 2017 and 2020, respectively. |
(4) | The 2012 Secured Notes consist of $500 million aggregate principal amount of 2.381% secured notes due 2017 and $1.0 billion aggregate principal amount of 3.849% secured notes due 2030. |
(5) | The Senior Secured Notes, Series 2009-1 consist of $96 million of principal as of September 30, 2014 that amortizes through 2019, and $70 million of principal as of September 30, 2014 that amortizes during the period beginning in 2019 and ending in 2029. |
(6) | The anticipated repayment date is 2015 for each class of the WCP Secured Wireless Site Contracts Revenue Notes, Series 2010-1 ("WCP Securitized Notes"). If the WCP Securitized Notes are not repaid in full by their anticipated repayment dates, the applicable interest rate increases by an additional approximately 5% per annum. If the WCP Securitized Notes are not repaid in full by their rapid amortization date of 2017, monthly principal payments commence using the excess cash flows of the issuers of the WCP Securitized Notes. |
(7) | As of September 30, 2014, the undrawn availability under the $1.5 billion Revolving Credit Facility is $1.1 billion. |
(8) | Notes are prepayable at par if voluntarily repaid six months or less prior to maturity; earlier prepayment may require additional consideration. |
(9) | As of September 30, 2014, approximately $570 million of the Term Loan B have 101 soft call until the next call date. |
(10) | Market capitalization calculated based on $80.53 closing price and 333.9 million shares outstanding as of September 30, 2014. |
(11) | Represents the sum of net debt, preferred stock (at liquidation value) and market capitalization. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
DEBT MATURITY OVERVIEW(1) |
![]() |
(1) | Where applicable, maturities reflect the Anticipated Repayment Date as defined in the respective debt agreement; excludes capital leases and other obligations; amounts presented at face value net of repurchases held at CCIC. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
LIQUIDITY OVERVIEW | |||
(dollars in thousands) | September 30, 2014 | ||
Cash and cash equivalents(1) | $ | 238,550 | |
Undrawn revolving credit facility availability(2) | 1,146,000 | ||
Restricted cash | 142,824 | ||
Debt and other long-term obligations | 11,573,678 | ||
Total equity | 6,862,745 |
(1) | Exclusive of restricted cash. |
(2) | Availability at any point in time is subject to reaffirmation of the representations and warranties in, and there being no default under, our credit agreement governing our senior credit facilities ("2012 Credit Facility"). |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
SUMMARY OF MAINTENANCE AND FINANCIAL COVENANTS | |||||
Debt | Borrower / Issuer | Covenant(1) | Covenant Level Requirement | As of September 30, 2014 | |
Maintenance Financial Covenants(2) | |||||
2012 Credit Facility | CCOC | Total Net Leverage Ratio | ≤ 5.50x | 4.2x | |
2012 Credit Facility | CCOC | Consolidated Interest Coverage Ratio | ≥ 2.50x | 6.0x | |
Restrictive Negative Financial Covenants | |||||
Financial covenants restricting ability to make restricted payments, including dividends | |||||
4.875% Senior Notes | CCIC | Debt to Adjusted Consolidated Cash Flow Ratio | ≤ 7.00x | 5.6x | |
5.25% Senior Notes | CCIC | Debt to Adjusted Consolidated Cash Flow Ratio | ≤ 7.00x | 5.6x | |
2012 Credit Facility | CCOC | Total Net Leverage Ratio | ≤ 5.50x | 4.2x | |
Financial covenants restricting ability to incur additional debt | |||||
4.875% Senior Notes | CCIC | Debt to Adjusted Consolidated Cash Flow Ratio | ≤ 7.00x | 5.6x | |
5.25% Senior Notes | CCIC | Debt to Adjusted Consolidated Cash Flow Ratio | ≤ 7.00x | 5.6x | |
2012 Credit Facility | CCOC | Total Net Leverage Ratio | ≤ 5.50x | (3) | 4.2x |
2012 Credit Facility | CCOC | Holdings Leverage Ratio | ≤ 7.00x | (4) | 5.6x |
2012 Credit Facility | CCOC | Consolidated Interest Coverage Ratio | ≥ 2.50x | 6.0x | |
2012 Secured Notes | CC Holdings GS V LLC and Crown Castle GS III Corp. | Debt to Adjusted Consolidated Cash Flow Ratio | ≤ 3.50x | 3.9x | |
Financial covenants restricting ability to make investments | |||||
2012 Credit Facility | CCOC | Total Net Leverage Ratio | ≤ 5.50x | 4.2x |
(1) | As defined in the respective debt agreement. |
(2) | Failure to comply with the financial maintenance covenants would, absent a waiver, result in an event of default under the credit agreement governing our 2012 Credit Facility. |
(3) | Applicable for debt issued at CCOC or its subsidiaries. |
(4) | Applicable for debt issued at CCIC or its subsidiaries. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
SUMMARY OF MAINTENANCE AND FINANCIAL COVENANTS (CONTINUED) | |||||
Debt | Borrower / Issuer | Covenant(1) | Covenant Level Requirement | As of September 30, 2014 | |
Restrictive Negative Financial Covenants | |||||
Financial covenants requiring excess cash flows to be deposited in a cash trap reserve account and not released | |||||
2010 Tower Revenue Notes | Crown Castle Towers LLC and its Subsidiaries | Debt Service Coverage Ratio | > 1.75x | (2) | 4.3x |
WCP Securitized Notes | Certain WCP Subsidiaries | Debt Service Coverage Ratio | > 1.30x | (2) | 1.4x |
2009 Securitized Notes | Pinnacle Towers Acquisition Holdings LLC and its Subsidiaries | Debt Service Coverage Ratio | > 1.30x | (2) | 4.5x |
Financial covenants restricting ability of relevant issuer to issue additional notes under the applicable indenture | |||||
2010 Tower Revenue Notes | Crown Castle Towers LLC and its Subsidiaries | Debt Service Coverage Ratio | ≥ 2.00x | (3) | 4.3x |
WCP Securitized Notes | Certain WCP Subsidiaries | Debt Service Coverage Ratio | ≥ 1.50x | (3) | 1.4x |
2009 Securitized Notes | Pinnacle Towers Acquisition Holdings LLC and its Subsidiaries | Debt Service Coverage Ratio | ≥ 2.34x | (3) | 4.5x |
(1) | As defined in the respective debt agreement. In the indentures for the 2010 Tower Revenue Notes, WCP Securitized Notes, and the 2009 Securitized Notes, the defined term for Debt Service Coverage Ratio is "DSCR". |
(2) | The 2010 Tower Revenue Notes, WCP Securitized Notes, and 2009 Securitized Notes also include the potential for amortization events, which could result in applying current and future cash flow to the prepayment of debt with applicable prepayment consideration. An amortization event occurs when the Debt Service Coverage Ratio falls below 1.45x, 1.15x or 1.15x, in each case as described under the indentures for the 2010 Tower Revenue Notes, WCP Securitized Notes, or 2009 Securitized Notes, respectively. |
(3) | Rating Agency Confirmation (as defined in the respective debt agreement) is also required. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
INTEREST RATE SENSITIVITY(1) | |||||||||
Remaining three months, | Years Ended December 31, | ||||||||
(as of September 30, 2014; dollars in millions) | 2014 | 2015 | 2016 | ||||||
Fixed Rate Debt: | |||||||||
Face Value of Principal Outstanding(2) | $ | 7,570 | $ | 7,537 | $ | 7,518 | |||
Current Interest Payment Obligations(3) | 93 | 369 | 368 | ||||||
Effect of 0.125% Change in Interest Rates(4) | — | 1 | 2 | ||||||
Floating Rate Debt: | |||||||||
Face Value of Principal Outstanding(2) | $ | 3,835 | $ | 3,790 | $ | 3,728 | |||
Current Interest Payment Obligations(5) | 26 | 107 | 136 | ||||||
Effect of 0.125% Change in Interest Rates(6) | — | 2 | 2 |
(1) | Excludes capital lease and other obligations. |
(2) | Face value net of required amortizations; assumes no maturity or balloon principal payments; excludes capital leases. |
(3) | Interest expense calculated based on current interest rates. |
(4) | Interest expense calculated based on current interest rates until the sooner of the (1) stated maturity date or (2) the Anticipated Repayment Date, at which time the face value amount outstanding of such indebtedness is refinanced at current rates plus 12.5 bps. |
(5) | Interest expense calculated based on current interest rates. Forward LIBOR assumptions are derived from the 1-month LIBOR forward curve as of September 30, 2014. Calculation takes into account any LIBOR floors in place and assumes no changes to future interest rate margin spread over LIBOR due to changes in the Borrower’s net leverage ratio. |
(6) | Interest expense calculated based on current interest rates using forward LIBOR assumptions until the stated maturity date, at which time the face value amount outstanding of such indebtedness is refinanced at current rates plus 12.5 bps. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
DEFINITIONS |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
DEFINITIONS (continued) |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||
Net income (loss) | $ | 108,037 | $ | 46,468 | $ | 246,187 | $ | 116,582 | |||||||
Adjustments to increase (decrease) net income (loss): | |||||||||||||||
Asset write-down charges | 5,275 | 3,893 | 11,144 | 10,705 | |||||||||||
Acquisition and integration costs | 4,068 | 4,369 | 28,924 | 13,186 | |||||||||||
Depreciation, amortization and accretion | 254,862 | 195,408 | 759,288 | 572,518 | |||||||||||
Amortization of prepaid lease purchase price adjustments | 4,988 | 3,870 | 14,546 | 11,595 | |||||||||||
Interest expense and amortization of deferred financing costs(1) | 141,287 | 142,016 | 432,221 | 446,641 | |||||||||||
Gains (losses) on retirement of long-term obligations | — | 1 | 44,629 | 36,487 | |||||||||||
Interest income | (192 | ) | (236 | ) | (554 | ) | (861 | ) | |||||||
Other income (expense) | 678 | 631 | 9,477 | 753 | |||||||||||
Benefit (provision) for income taxes | 482 | 33,959 | 86 | 88,254 | |||||||||||
Stock-based compensation expense | 13,470 | 10,178 | 44,620 | 29,885 | |||||||||||
Adjusted EBITDA(2) | $ | 532,955 | $ | 440,557 | $ | 1,590,568 | $ | 1,325,745 |
Three Months Ended December 31, | Years Ended December 31, | ||||||||||||||
(dollars in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||
Net income (loss) | $ | (22,680 | ) | $ | (9,644 | ) | $ | 93,901 | $ | 200,888 | |||||
Adjustments to increase (decrease) net income (loss): | |||||||||||||||
Asset write-down charges | 4,158 | 7,298 | 14,863 | 15,548 | |||||||||||
Acquisition and integration costs | 12,820 | 6,186 | 26,005 | 18,298 | |||||||||||
Depreciation, amortization and accretion | 201,697 | 175,843 | 774,215 | 622,592 | |||||||||||
Amortization of prepaid lease purchase price adjustments | 3,878 | 3,866 | 15,473 | 14,166 | |||||||||||
Interest expense and amortization of deferred financing costs(1) | 142,989 | 173,683 | 589,630 | 601,044 | |||||||||||
Gains (losses) on retirement of long-term obligations | 641 | 117,388 | 37,127 | 131,974 | |||||||||||
Interest income | (494 | ) | (3,529 | ) | (1,355 | ) | (4,556 | ) | |||||||
Other income (expense) | 3,117 | 1,433 | 3,872 | 5,392 | |||||||||||
Benefit (provision) for income taxes | 110,374 | (70,623 | ) | 198,628 | (100,061 | ) | |||||||||
Stock-based compensation expense | 11,904 | 12,018 | 41,788 | 47,382 | |||||||||||
Adjusted EBITDA(2) | $ | 468,404 | $ | 413,919 | $ | 1,794,147 | $ | 1,552,667 |
(1) | See the reconciliation of “components of interest expense and amortization of deferred financing costs” herein. |
(2) | The above reconciliation excludes line items included in our Adjusted EBITDA definition which are not applicable for the periods shown. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
Three Months Ended September 30, 2014 | |||||||||||||||
(dollars in thousands) | CCUSA | CCAL | Eliminations | Consolidated Total | |||||||||||
Net income (loss) | $ | 103,017 | $ | 5,020 | $ | — | $ | 108,037 | |||||||
Adjustments to increase (decrease) net income (loss): | |||||||||||||||
Asset write-down charges | 4,932 | 343 | — | 5,275 | |||||||||||
Acquisition and integration costs | 4,068 | — | — | 4,068 | |||||||||||
Depreciation, amortization and accretion | 247,206 | 7,656 | — | 254,862 | |||||||||||
Amortization of prepaid lease purchase price adjustments | 4,988 | — | — | 4,988 | |||||||||||
Interest expense and amortization of deferred financing costs(1) | 141,287 | 3,862 | (3,862 | ) | 141,287 | ||||||||||
Gains (losses) on retirement of long-term obligations | — | — | — | — | |||||||||||
Interest income | (107 | ) | (85 | ) | — | (192 | ) | ||||||||
Other income (expense) | (3,168 | ) | (16 | ) | 3,862 | 678 | |||||||||
Benefit (provision) for income taxes | (1,977 | ) | 2,459 | — | 482 | ||||||||||
Stock-based compensation expense | 13,358 | 112 | — | 13,470 | |||||||||||
Adjusted EBITDA(2) | $ | 513,604 | $ | 19,351 | $ | — | $ | 532,955 |
Q4 2014 | Full Year 2014 | Full Year 2015 | |||
(dollars in millions) | Outlook | Outlook | Outlook | ||
Net income (loss) | $97 to $130 | $342 to $375 | $428 to $512 | ||
Adjustments to increase (decrease) net income (loss): | |||||
Asset write-down charges | $4 to $6 | $15 to $17 | $16 to $26 | ||
Acquisition and integration costs | $2 to $6 | $31 to $35 | $0 to $0 | ||
Depreciation, amortization and accretion | $252 to $257 | $1,011 to $1,016 | $1,007 to $1,027 | ||
Amortization of prepaid lease purchase price adjustments | $4 to $6 | $18 to $20 | $19 to $21 | ||
Interest expense and amortization of deferred financing costs(1) | $138 to $143 | $571 to $576 | $521 to $536 | ||
Gains (losses) on retirement of long-term obligations | $0 to $0 | $45 to $45 | $0 to $0 | ||
Interest income | $(1) to $1 | $(2) to $0 | $(2) to $0 | ||
Other income (expense) | $(1) to $1 | $9 to $11 | $1 to $3 | ||
Benefit (provision) for income taxes | $1 to $5 | $1 to $5 | $7 to $15 | ||
Stock-based compensation expense | $14 to $16 | $59 to $61 | $65 to $70 | ||
Adjusted EBITDA(2) | $538 to $543 | $2,128 to $2,133 | $2,126 to $2,146 |
(1) | See the reconciliation of “components of interest expense and amortization of deferred financing costs” herein. |
(2) | The above reconciliation excludes line items included in our Adjusted EBITDA definition which are not applicable for the periods shown. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
Three Months Ended September 30, | |||||||
(dollars in thousands) | 2014 | 2013 | |||||
Interest expense on debt obligations | $ | 121,450 | $ | 121,246 | |||
Amortization of deferred financing costs | 5,516 | 5,366 | |||||
Amortization of adjustments on long-term debt | (892 | ) | (971 | ) | |||
Amortization of interest rate swaps(1) | 15,551 | 16,222 | |||||
Other, net | (338 | ) | 153 | ||||
Interest expense and amortization of deferred financing costs | $ | 141,287 | $ | 142,016 |
Q4 2014 | Full Year 2014 | Full Year 2015 | |||
(dollars in millions) | Outlook | Outlook | Outlook | ||
Interest expense on debt obligations | $121 to $123 | $492 to $494 | $488 to $498 | ||
Amortization of deferred financing costs | $6 to $7 | $22 to $23 | $21 to $23 | ||
Amortization of adjustments on long-term debt | $(1) to $0 | $(4) to $(3) | $(4) to $(2) | ||
Amortization of interest rate swaps (1) | $14 to $16 | $62 to $64 | $16 to $21 | ||
Other, net | $0 to $0 | $(1) to $(1) | $(2) to $0 | ||
Interest expense and amortization of deferred financing costs | $138 to $143 | $571 to $576 | $521 to $536 |
(1) | Relates to the amortization of interest rate swaps; the swaps were cash settled in prior periods. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(dollars in thousands, except share and per share amounts) | 2014 | 2013 | 2014 | 2013 | |||||||||||
Net income | $ | 108,037 | $ | 46,468 | $ | 246,187 | $ | 116,582 | |||||||
Real estate related depreciation, amortization and accretion | 249,994 | 192,707 | 743,898 | 562,501 | |||||||||||
Asset write-down charges | 5,275 | 3,893 | 11,144 | 10,705 | |||||||||||
Adjustment for noncontrolling interest(1) | (1,100 | ) | (632 | ) | (3,744 | ) | (2,925 | ) | |||||||
Dividends on preferred stock | (10,997 | ) | — | (32,991 | ) | — | |||||||||
FFO(3) | $ | 351,211 | $ | 242,436 | $ | 964,496 | $ | 686,862 | |||||||
FFO (from above) | $ | 351,211 | $ | 242,436 | $ | 964,496 | $ | 686,862 | |||||||
Adjustments to increase (decrease) FFO: | |||||||||||||||
Straight-line revenue | (46,752 | ) | (53,294 | ) | (149,692 | ) | (169,612 | ) | |||||||
Straight-line expense | 24,954 | 20,604 | 78,750 | 61,883 | |||||||||||
Stock-based compensation expense | 13,470 | 10,178 | 44,620 | 29,885 | |||||||||||
Non-cash portion of tax provision(4) | (2,628 | ) | 32,510 | (7,513 | ) | 83,318 | |||||||||
Non-real estate related depreciation, amortization and accretion | 4,868 | 2,701 | 15,389 | 10,017 | |||||||||||
Amortization of non-cash interest expense | 19,837 | 20,771 | 61,322 | 78,242 | |||||||||||
Other (income) expense | 678 | 631 | 9,477 | 753 | |||||||||||
Gains (losses) on retirement of long-term obligations | — | 1 | 44,629 | 36,487 | |||||||||||
Acquisition and integration costs | 4,068 | 4,369 | 28,924 | 13,186 | |||||||||||
Adjustment for noncontrolling interest(1) | 1,100 | 632 | 3,744 | 2,925 | |||||||||||
Capital improvement capital expenditures | (7,911 | ) | (3,741 | ) | (16,240 | ) | (9,454 | ) | |||||||
Corporate capital expenditures | (12,474 | ) | (6,478 | ) | (28,216 | ) | (17,724 | ) | |||||||
AFFO(2) | $ | 350,418 | $ | 271,319 | $ | 1,049,687 | $ | 806,768 | |||||||
Weighted average common shares outstanding — diluted | 333,241 | 291,378 | 333,020 | 292,043 | |||||||||||
AFFO per share(2) | $ | 1.05 | $ | 0.93 | $ | 3.15 | $ | 2.76 | |||||||
AFFO (from above) | $ | 350,418 | $ | 271,319 | $ | 1,049,687 | $ | 806,768 | |||||||
Prepaid rent received | 81,240 | 63,940 | 233,070 | 153,630 | |||||||||||
Amortization of prepaid rent | (27,541 | ) | (17,105 | ) | (69,055 | ) | (47,057 | ) | |||||||
AFFO, as previously defined(2) | $ | 404,116 | $ | 318,154 | $ | 1,213,702 | $ | 913,340 |
(1) | Inclusive of the noncontrolling interest related to real estate related depreciation, amortization and accretion and asset write-downs. |
(2) | See definitions herein. See also “Definitions of Non-GAAP Financial Measures and Other Calculations” herein for a discussion of the definitions of FFO and AFFO. |
(3) | FFO, as previously defined, for Q3 and year to date 2014 was $344.4 million and $949.6 million respectively, which is exclusive of the net impact from the update of the definition of $(6.8) million and $(14.9) million, respectively, which amount includes the adjustment for non-cash portion of tax provision and excludes the adjustments for asset write-down charges and noncontrolling interests. FFO, as previously defined, for Q3 and year to date 2013 was previously reported as $271.7 million and $762.4 million, respectively, which is exclusive of the net impact from the update of the definition of $29.3 million and $75.5 million, respectively, which amount includes the adjustment for non-cash portion of tax provision and excludes the adjustments for asset write down charges and noncontrolling interests. |
(4) | Adjusts the income tax provision for 2013 to reflect our estimate of the cash taxes had we been a REIT, which predominately relates to foreign taxes paid. As a result, income tax expense (benefit) is lower by the amount of the adjustment. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
Years Ended December 31, | |||||||
(in thousands of dollars, except share and per share amounts) | 2013 | 2012 | |||||
Net income | $ | 93,901 | $ | 200,888 | |||
Real estate related depreciation, amortization and accretion | 761,070 | 601,372 | |||||
Asset write-down charges | 14,863 | 15,548 | |||||
Adjustment for noncontrolling interest(1) | (3,790 | ) | (12,304 | ) | |||
Dividends on preferred stock | — | (2,481 | ) | ||||
FFO(3) | $ | 866,043 | $ | 803,023 | |||
FFO (from above) | $ | 866,043 | $ | 803,023 | |||
Adjustments to increase (decrease) FFO: | |||||||
Straight-line revenue | (218,631 | ) | (251,327 | ) | |||
Straight-line expense | 80,953 | 54,069 | |||||
Stock-based compensation expense | 41,788 | 47,382 | |||||
Non-cash portion of tax provision(2) | 191,729 | (106,742 | ) | ||||
Non-real estate related depreciation, amortization and accretion | 13,145 | 21,220 | |||||
Amortization of non-cash interest expense | 99,244 | 109,337 | |||||
Other (income) expense | 3,872 | 5,392 | |||||
Gains (losses) on retirement of long-term obligations | 37,127 | 131,974 | |||||
Net gain (loss) on interest rate swaps | — | — | |||||
Acquisition and integration costs | 26,005 | 18,298 | |||||
Adjustment for noncontrolling interest(1) | 3,790 | 12,304 | |||||
Capital improvement capital expenditures | (19,312 | ) | (21,647 | ) | |||
Corporate capital expenditures | (28,409 | ) | (15,459 | ) | |||
AFFO(3) | $ | 1,097,347 | $ | 807,823 | |||
Weighted average common shares outstanding — diluted | 299,293 | 291,270 | |||||
AFFO per share(3) | $ | 3.67 | $ | 2.77 | |||
AFFO (from above) | $ | 1,097,347 | $ | 807,823 | |||
Prepaid rent received | 241,451 | 117,419 | |||||
Amortization of prepaid rent | (66,728 | ) | (41,592 | ) | |||
Dividends on preferred stock | — | 2,481 | |||||
AFFO, as previously defined(3) | $ | 1,272,070 | $ | 886,131 |
(1) | Inclusive of the noncontrolling interest related to real estate related depreciation, amortization and accretion and asset write-downs. |
(2) | Adjusts the income tax provision to reflect our estimate of the cash taxes had we been a REIT, which predominately relates to foreign taxes paid. As a result income tax expense (benefit) is lower by the amount of the adjustment. |
(3) | See reconciliations and definitions provided herein. See also "Definitions of Non-GAAP Measures and Other Terms" herein for a discussion of the definitions of FFO and AFFO. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
Three Months Ended December 31, | |||||||
(in thousands of dollars, except share and per share amounts) | 2013 | 2012 | |||||
Net income | $ | (22,681 | ) | $ | (9,644 | ) | |
Real estate related depreciation, amortization and accretion | 198,569 | 170,484 | |||||
Asset write-down charges | 4,158 | 7,299 | |||||
Adjustment for noncontrolling interest(1) | (866 | ) | (9,861 | ) | |||
FFO(3) | $ | 179,181 | $ | 158,278 | |||
FFO (from above) | $ | 179,181 | $ | 158,278 | |||
Adjustments to increase (decrease) FFO: | |||||||
Straight-line revenue | (49,019 | ) | (62,595 | ) | |||
Straight-line expense | 19,071 | 16,087 | |||||
Stock-based compensation expense | 11,904 | 12,018 | |||||
Non-cash portion of tax provision(2) | 108,411 | (72,538 | ) | ||||
Non-real estate related depreciation, amortization and accretion | 3,128 | 5,359 | |||||
Amortization of non-cash interest expense | 21,003 | 35,690 | |||||
Other (income) expense | 3,117 | 1,433 | |||||
Gains (losses) on retirement of long-term obligations | 641 | 117,388 | |||||
Acquisition and integration costs | 12,820 | 6,186 | |||||
Adjustment for noncontrolling interest(1) | 866 | 9,861 | |||||
Capital improvement capital expenditures | (9,858 | ) | (10,928 | ) | |||
Corporate capital expenditures | (10,685 | ) | (7,174 | ) | |||
AFFO(3) | $ | 290,579 | $ | 209,064 | |||
Weighted average common shares outstanding — diluted | 319,634 | 292,470 | |||||
AFFO per share(3) | $ | 0.91 | $ | 0.71 | |||
AFFO (from above) | $ | 290,579 | $ | 209,064 | |||
Prepaid rent received | 87,822 | 46,548 | |||||
Amortization of prepaid rent | (19,671 | ) | (12,582 | ) | |||
AFFO, as previously defined(3) | $ | 358,730 | $ | 243,031 |
(1) | Inclusive of the noncontrolling interest related to real estate related depreciation, amortization and accretion and asset write-downs. |
(2) | Adjusts the income tax provision to reflect our estimate of the cash taxes had we been a REIT, which predominately relates to foreign taxes paid. As a result income tax expense (benefit) is lower by the amount of the adjustment. |
(3) | See reconciliations and definitions provided herein. See also "Definitions of Non-GAAP Measures and Other Terms" herein for a discussion of the definitions of FFO and AFFO. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
Q4 2014 | Full Year 2014 | Full Year 2015 | |||
(in millions of dollars, except share and per share amounts) | Outlook | Outlook | Outlook | ||
Net income | $97 to $130 | $342 to $375 | $428 to $512 | ||
Real estate related depreciation, amortization and accretion | $248 to $251 | $992 to $995 | $990 to $1,005 | ||
Asset write-down charges | $4 to $6 | $15 to $17 | $16 to $26 | ||
Adjustment for noncontrolling interest(1) | $(2) to $2 | $(6) to $(2) | $(6) to $2 | ||
Dividends on preferred stock | $(11) to $(11) | $(44) to $(44) | $(44) to $(44) | ||
FFO(3) | $353 to $358 | $1,317 to $1,322 | $1,429 to $1,449 | ||
FFO (from above) | $353 to $358 | $1,317 to $1,322 | $1,429 to $1,449 | ||
Adjustments to increase (decrease) FFO: | |||||
Straight-line revenue | $(49) to $(44) | $(198) to $(193) | $(144) to $(129) | ||
Straight-line expense | $23 to $28 | $102 to $107 | $87 to $102 | ||
Stock-based compensation expense | $14 to $16 | $59 to $61 | $65 to $70 | ||
Non-cash portion of tax provision | $(2) to $3 | $(10) to $(5) | $(5) to $10 | ||
Non-real estate related depreciation, amortization and accretion | $4 to $6 | $19 to $21 | $17 to $22 | ||
Amortization of non-cash interest expense | $19 to $23 | $79 to $83 | $31 to $42 | ||
Other (income) expense | $(1) to $1 | $9 to $11 | $1 to $3 | ||
Gains (losses) on retirement of long-term obligations | $0 to $0 | $45 to $45 | $0 to $0 | ||
Acquisition and integration costs | $2 to $6 | $31 to $35 | $0 to $0 | ||
Adjustment for noncontrolling interest(1) | $2 to $(2) | $6 to $2 | $6 to $(2) | ||
Capital improvement capital expenditures | $(15) to $(13) | $(32) to $(30) | $(38) to $(33) | ||
Corporate capital expenditures | $(18) to $(16) | $(47) to $(45) | $(47) to $(42) | ||
AFFO(3) | $346 to $351 | $1,396 to $1,401 | $1,437 to $1,457 | ||
Weighted-average common shares outstanding—diluted(2) | 333.2 | 333.2 | 333.2 | ||
AFFO per share(3) | $1.04 to $1.05 | $4.19 to $4.20 | $4.31 to $4.37 |
(1) | Inclusive of the noncontrolling interest related to real estate related depreciation, amortization and accretion and asset write-downs. |
(2) | Based on 333.2 million diluted shares outstanding as of September 30, 2014. |
(3) | See definitions herein. See also “Definitions of Non-GAAP Financial Measures and Other Calculations” herein for a discussion of the definitions of FFO and AFFO. |
COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX |
Nine Months Ended September 30, | ||||||
(dollars in millions) | 2014 | 2013 | ||||
Total face value of debt | $ | 11,573.1 | $ | 10,768.5 | ||
Ending cash and cash equivalents | 238.6 | 218.6 | ||||
Total Net Debt | $ | 11,334.5 | $ | 10,549.9 | ||
Adjusted EBITDA for the three months ended September 30, | $ | 533.0 | $ | 440.6 | ||
Last quarter annualized adjusted EBITDA | 2,131.8 | 1,762.2 | ||||
Net Debt to Last Quarter Annualized Adjusted EBITDA | 5.3x | 6.0x |
Three Months Ended September 30, | |||||||
(dollars in thousands) | 2014 | 2013 | |||||
Adjusted EBITDA | $ | 532,955 | $ | 440,557 | |||
Interest expense on debt obligations | 121,450 | 121,246 | |||||
Interest Coverage Ratio | 4.4x | 3.6x |
Three Months Ended September 30, | |||
(per share) | 2014 | ||
Dividend per share | $ | 0.35 | |
AFFO per share | $ | 1.05 | |
AFFO Payout Ratio | 33 | % |
&NCKBG\3.V'PH*XO51GQ=>Y/'V2WX]3NEKM*X_4"!XOO>,G[+;]?\`>EJZ
M/QDUO@"&$9#L.@X%.S\Q).233FDW9':HQWS76V!BEHI7&%%%%`!4#
MNSOL0C'K4LC[%)[]J+>+`R>IYK&M/E5EN;T8)^\]@2#8I(^]ZU*D9`';/6I:
M*X^4V;N-"@'('-#H'7!IW>BG816:%U/'(IPA#=3GZ5/0`!4\@K$'E!.Q-(I9
MG`*X`J?%(RY(-)Q"P*,`T8R>G2EQQ2@55AB8P.E-.,TX\TF/RH:`.#4;`!UQ
M4H6FN/F2E9@(!GBE`QUH[48]:E(!>"*4#%'%&><5IH!%+!YLD+;ROE/NP!UX
M(_K3$LPEW).&&YSD_*,]`,9_"K-%,"C#IH@9V29@7#;^!ALG.?PS34TL16LE
MNDS*DB!2-HZXQD?45HTE%P('@+W$4N_F,$$8ZYQ_A3(K,1./G8H&+(A'W35K
M.!D]*0C.#2L!4M+!;:0R)*QW9WC`PV3G^M306ZP*5'(+%OS.:D5=IR.E.)P.
M*7J`$#TIK1A\9[4_K13L@(A%LSSFEZ#BI#R*;MP>M2XZ@,'J>E-R3(W/85-Q
MW'`J(8,K8]*5@%`]**<4/7/%-VCKSGZU-@(RA+$X.*>`,`8H.0"2>*C9CA@!
MP3P:!#I2%0C^]Q2QJJI@'(J.0'8JL/RHC;CA1N''UHZ!U%V9?!Z]J:O!([TJ
MO\X)XQ0Y_>`]/>D(7SCC`'-2$DI\P]J@4;CWJ926`-,:';5`(P.?:D'.32L<
M"F`\$J,YH&)*AD3;N*@]Q62ND2/+(\D[<.-A?YCM'<'L36R>GO52]MFN/+Q(
MX0'YU5BNX?4528$;[&WKD$#AAG/YUS::?+HVN01Z98`VMXYDN92_*GM@=JZB
MUL(+=0$7^':3TW>Y]ZP?$^BZG=36]YI5^T$]L#B-ON-G_/I4M\K4ET.S`R7.
MZ4Y)1DFM;VO;2]NS^XZ0,"2O<4ZN?/BO3+;4(M-O)BEZ43/R':6/8&M\$-T.
M<5Z<*D9ZQ=SSJV&JT;>TBTGJO-=T(5!&*CQ[XJ:DQZUI5!V\GDBN.'@>RF
MN9)]4NKB_F+L4:0D*JDYQ@'G'/H/:NM6ZA+E!("P;:1@Y!QFG/&'7KP*4H1>
MZ+H8NOAT_8RY;[VW^_=?(Q(-%LX('MH45+0Q%2@&-S$$%B/I7+:IX:O[":VE
M\/M\L& W.$[?I70SZ/E48A431LOS1<'N.QJ4G!I:8AD;[T!Q
M@]QZ4P3EB<1L0#U%8NN);WMY9Q1ZXEC/!<*TD:N-TF>BD9[_`.16+?6CZI'?
M:IJL-_IJ6"2PI'"^?-0Y^8#_`"#^%9RJ6O9'H4,"JBC*4[7\M?*RTO?RO;J:
M^C^)9K[6K[2[ZQ:TFMSN0DY#)G@D^M="&5NA!%
`]A3<'*/.Y6W6BZ._3SOTL68_"MDGA
MX:,YEFMADYD;+9)SD'M^%59]"ATZ::8ZM+;6KVGV:.)F`6/`^\"3UX)_.M&W
MU._?6YK.;3]EHD*NMT'R&8CD?S'X>]>6>(Y]9UK5(+&:YCOI0[B)+91M'/KZ
M\=^E14E&*5HWZ?H=.6X;$XJM*-2JE%^\]GOK?LGIK>S1E:N3)JOD6M_-J*Q`
M1Q3%2"<=@.>,YK/AGFMI"\,CQN05)4X.#U%=OI.B:MX.8ZU=Z=]I;;Y:01/E
ME9N[8!P`!V]17*O)'JNNM)=LEE'<3$N4C^6/)]*Y*E)QM?23Z?\`!/M\)BZ=
M7FA3M*G%?$FG=]59+\EKT/0/">L7TUJTFIW221NJB&-,%R`""3^5=$FJ&1OF
MC90,8(YQR1T_"O,]%TFTU75%TD+-*0762YC;:$0'(.#U_'U]J[G5_"VJ7,9_(4$88'
M@<4AZ<`X^M`"LP"#'7W%2HP+?O``<<$&F/NVK\F/>D+!3M(Y/IVH`LH=SEE'
M`%2("V2.M52RIP&)4^E2EBQ`4$+CN:EH=R;Y?7@