Crown Castle International Reports Fourth Quarter and Full Year 2005 Results and Raises 2006 Outlook
HOUSTON, Feb 28, 2006 /PRNewswire-FirstCall via COMTEX News Network/ -- Crown Castle International Corp. (NYSE: CCI) today reported results for the fourth quarter ended December 31, 2005.
Site rental revenue for the fourth quarter of 2005 increased 11.2% to $155.4 million, up $15.7 million from $139.8 million for the same period in 2004. Site rental gross margin, defined as site rental revenue less site rental cost of operations, increased 15.2% to $105.5 million, up $13.9 million from $91.6 million for the same period in 2004. Adjusted EBITDA for the fourth quarter of 2005 increased $16.1 million, or 21.6%, to $90.4 million, up from $74.4 million for the same period in 2004.
Recurring cash flow, defined as Adjusted EBITDA less interest expense less sustaining capital expenditures, increased $25.5 million, or 84.9%, to $55.5 million for the fourth quarter of 2005, compared to $30.0 million for the fourth quarter of 2004. Weighted average common shares outstanding decreased to 213.5 million for the fourth quarter of 2005 from 222.8 million for the same period in the prior year. Recurring cash flow per share, defined as recurring cash flow divided by weighted average common shares outstanding, improved to $0.26 in the fourth quarter of 2005 compared to $0.13 in the fourth quarter of 2004.
Net loss was $23.3 million for the fourth quarter of 2005, inclusive of a $9.0 million charge from the cumulative effect of a change in accounting principle, compared to a net loss of $87.7 million for the same period in 2004, inclusive of $39.4 million of losses from the retirement of debt. Net loss after deduction of dividends on preferred stock was $44.0 million in the fourth quarter of 2005, inclusive of a $9.0 million charge from the cumulative effect of a change in accounting principle, compared to a net loss of $97.4 million for the same period last year, inclusive of $39.4 million of losses from the retirement of debt. Fourth quarter 2005 net loss per share was $0.21, compared to a net loss per share of $0.44 in last year's fourth quarter.
Site rental revenue for the full year 2005 increased 10.9% to $597.1 million, up $58.8 million from $538.3 million for the full year 2004. Site rental gross margin for the full year 2005 increased 12.9% to $399.8 million, up $45.7 million from $354.0 million for the full year 2004. Adjusted EBITDA for the full year 2005 increased $47.9 million, or 16.7%, to $335.1 million, up from $287.1 million for the full year 2004.
Recurring cash flow increased $116.8 million, or 165.5%, to $187.4 million for the full year 2005, from $70.6 million for the full year 2004. Weighted average common shares outstanding decreased to 217.8 million for the full year 2005, from 221.7 million for the full year 2004. Recurring cash flow per share improved to $0.86 for the full year 2005, compared to $0.32 for the full year 2004.
Net loss was $401.5 million for the full year 2005, inclusive of $295.8 million in losses from the retirement of debt and a $9.0 million charge from the cumulative effect of a change in accounting principle, compared to net income of $233.1 million for the full year 2004, inclusive of $534.7 million in income from discontinued operations (primarily from the sale of Crown Castle UK) and $63.8 million in losses from the retirement of debt. Net loss after deduction of dividends on preferred stock was $450.9 million for the full year 2005, inclusive of $295.8 million in losses from the retirement of debt and a $9.0 million charge from the cumulative effect of a change in accounting principle, compared to net income of $194.5 million in the full year 2004, inclusive of $534.7 million in income from discontinued operations (primarily from the sale of Crown Castle UK) and $63.8 million in losses from the retirement of debt. Full year 2005 net loss per share was $2.07 compared to net income per share of $0.88 for the full year 2004, inclusive of $2.42 per share in income from discontinued operations.
"I am very pleased with our fourth quarter 2005 performance as we doubled annualized recurring cash flow per share during the last 12 months," stated John P. Kelly, President and Chief Executive Officer of Crown Castle. "Our strong site rental revenue growth of 11.2% was driven by robust tenant additions on our towers as our customers continued to enhance their wireless networks. We remain excited about the outlook for growth in site rental revenue for 2006 as we are seeing activity from all of our major customers, as well as increasing activity from new wireless entrants."
SEGMENT RESULTS
US site rental revenue for the fourth quarter of 2005 increased $14.6 million, or 11.3%, to $143.8 million, compared to fourth quarter of 2004 US site rental revenue of $129.2 million. US site rental gross margin for the fourth quarter of 2005 increased $12.8 million, or 14.9%, to $98.5 million, compared to fourth quarter of 2004 US site rental gross margin of $85.7 million.
Australia site rental revenue for the fourth quarter of 2005 increased $1.0 million, or 9.5%, to $11.5 million, compared to $10.5 million in the fourth quarter of 2004. Australia site rental gross margin for the fourth quarter of 2005 increased $1.3 million, or 23.2%, to $7.2 million, compared to fourth quarter of 2004 Australia site rental gross margin of $5.9 million.
INVESTMENTS
During the fourth quarter of 2005, Crown Castle invested approximately $251.8 million in capital expenditures and purchases of its common shares and 8 1/4% Convertible Preferred Stock. During the quarter, Crown Castle purchased approximately 0.9 million shares of its common stock using $21.8 million in cash at an average price of $24.72. On December 16, 2005, Crown Castle exercised its redemption right to purchase its 8 1/4% Convertible Preferred Stock, which had a conversion price of $26.875, using approximately $204 million in cash, thereby removing the potential dilution of 7.44 million shares, or 3.5% of common shares outstanding. Common shares outstanding -- basic and diluted -- were 214.1 million on December 31, 2005.
Also, during the fourth quarter of 2005, Crown Castle spent $25.9 million on capital expenditures, comprised of $4.4 million of sustaining capital expenditures and $21.5 million of revenue generating capital expenditures, of which $8.8 million was spent on existing sites, $5.8 million on land purchases and $6.9 million on the construction of new sites.
"In 2005, we invested approximately $310 million to purchase approximately 16 million common shares and approximately $423 million to eliminate the potential dilution of 18.3 million shares from our 8 1/4% Convertible Preferred Stock and 4% Convertible Notes," stated Ben Moreland, Chief Financial Officer of Crown Castle. "We believe these purchases of current and potential shares outstanding were the highest and best use of our capital and will positively impact long-term recurring cash flow per share growth. In 2006, we will strive to continue to make prudent capital investments through the purchase or construction of towers, improvements to our existing towers and the purchase of our common shares. We plan to consistently evaluate our potential capital investments based on their expected impact to long-term recurring cash flow per share, and we remain focused on our long-term goal of growing recurring cash flow per share by 20% to 25%."
On November 30, 2005, Crown Castle announced it had amended and increased its revolving credit facility from $275 million to $325 million. The outstanding amount of the revolving credit facility was $295 million at December 31, 2005.
NON-CASH ADJUSTMENTS
As previously announced on February 13, 2006, Crown Castle determined that certain non-cash adjustments should be recorded primarily related to errors in its lease accounting practices. The non-cash adjustments resulted in a net aggregate $19.0 million improvement in net income (loss) for historical periods prior to October 1, 2005, comprised of a decrease in site rental revenue of $0.7 million, a decrease in ground rent expense (a component of site rental costs of operations) of $12.1 million, an increase in non-cash compensation expense (included in general and administrative expenses) of $0.8 million, a decrease in depreciation expense of $12.1 million, and a decrease in minority interest of $3.7 million. The adjustments do not affect cash flow or the timing of lease payments.
All prior period financial information discussed in this release has been restated to reflect the non-cash adjustments. The net impacts of the changes in our lease accounting on site rental revenues, site rental costs of operations and Adjusted EBITDA in 2004 and 2005 are set forth on the following tables* (in millions):
Site Rental
Revenue Q1 '04 Q2 '04 Q3 '04 Q4 '04 Full Year 2004
US $0.4 $0.4 $0.4 $0.4 $1.6
Australia (0.2) (0.2) (0.2) (0.2) (0.8)
Total 0.2 0.2 0.2 0.2 0.8
Site Rental Cost
of Operations
US 0.0 0.0 0.0 0.0 0.1
Australia 0.0 0.0 0.0 0.0 0.0
Total 0.0 0.0 0.0 0.0 0.1
Impact on
Adjusted EBITDA 0.2 0.2 0.2 0.2 0.7
Site Rental
Revenue Q1 '05 Q2 '05 Q3 '05 9 months ended
September 2005
US $0.5 $0.5 $0.5 $1.5
Australia 0.0 0.0 0.0 0.1
Total 0.5 0.5 0.5 1.6
Site Rental
Cost of Operations
US 0.6 0.6 0.6 1.8
Australia 0.0 0.0 0.0 0.1
Total 0.6 0.6 0.6 1.9
Impact on
Adjusted EBITDA (0.1) (0.1) (0.1) (0.3)
* Columns and rows may not sum due to rounding
OUTLOOK
The following outlook tables are based on current expectations and assumptions and assume a US dollar to Australian dollar exchange rate of 0.735 US dollars to 1.00 Australian dollars. This Outlook section contains forward- looking statements, and actual results may differ materially. Information regarding potential risks which could cause actual results to differ from the forward-looking statements herein is set forth below and in Crown Castle's filings with the Securities and Exchange Commission.
The outlook for the full year 2006 reflects $5 million of increases to site rental revenue and site rental gross margin and $8 million of increases to Adjusted EBITDA and recurring cash flow from the full year 2006 outlook provided on December 1, 2005.
The following tables set forth Crown Castle's current outlook:
(dollars in millions,
except per share amounts) First Quarter 2006 Full Year 2006
Site rental revenue $159 to 161 $660 to 670
Site rental cost of operations $50 to 52 $208 to 212
Site rental gross margin $108 to 110 $450 to 460
Adjusted EBITDA $90 to 92 $378 to 388
Interest expense $32 to 33 $126 to 129
Sustaining capital expenditures $4 to 5 $11 to 15
Recurring cash flow $54 to 56 $234 to 244
Net loss after deduction of dividends
on preferred stock $(22) to (14) $(85) to (46)
Net loss per share* $(0.10) to (0.06) $(0.40) to (0.22)
* Based on shares outstanding at December 31, 2005
CONFERENCE CALL DETAILS
Crown Castle has scheduled a conference call for Wednesday, March 1, 2006 at 10:30 a.m. eastern time to discuss the fourth quarter and the full year 2005 results and Crown Castle's Outlook. Please dial 303-262-2050 and ask for the Crown Castle call at least 10 minutes prior to the start time. A telephonic replay of the conference call will be available through March 8, 2006, and may be accessed by calling 303-590-3000 and using pass code 11053782#. An audio archive will also be available on Crown Castle's website at http://www.crowncastle.com shortly after the call and will be accessible for approximately 90 days.
Crown Castle International Corp. engineers, deploys, owns and operates technologically advanced shared wireless infrastructure, including extensive networks of towers. Crown Castle offers significant wireless communications coverage to 76 of the top 100 U.S. markets and to substantially all of the Australian population. Crown Castle owns, operates and manages over 11,000 and over 1,300 wireless communication sites in the U.S. and Australia, respectively. For more information on Crown Castle, please visit http://www.crowncastle.com .
Non-Cash Compensation
Crown Castle incurs non-cash compensation charges related to the issuance of restricted stock and stock options to certain employees and executives. Beginning in the first quarter of 2005 and in accordance with the provisions of SEC Staff Accounting Bulletin No. 107, Crown Castle began classifying all non-cash compensation as components of cost of operations and general and administrative costs. In prior periods, Crown Castle had shown non-cash compensation as a separate line-item on its income statement. Prior period amounts of non-cash compensation have been reclassified for comparison purposes.
Asset Retirement Obligations
The Company adopted FASB Interpretation No. 47, Accounting for Conditional Asset Retirement Obligations -- an interpretation of FASB Statement No. 143, on December 31, 2005. SFAS 143 requires a liability to be recorded if the fair value of the obligation can be reasonably estimated. The types of asset retirement obligations that are covered by FIN 47 are those for which an entity has a legal obligation to perform an asset retirement activity, but the timing and (or) method of settling the obligation are conditional on a future event that may or may not be within the control of the entity. The adoption of FIN 47 resulted in the recognition of liabilities of $14.1 million for contingent retirement obligations under certain tower site land leases (included in other long-term liabilities), asset retirement costs of $5.1 million (included in property and equipment), and the recognition of a charge for the cumulative effect of the change in accounting principle of $9.0 million.
Summary of Non-Cash Amounts In Tower Gross Margin
In accordance with applicable accounting standards, Crown Castle recognizes site rental revenues and ground lease expenses monthly on a straight-line basis, regardless of whether the receipts and payments are in equal monthly amounts. An agreement, related to an acquisition in Australia, provides the seller with a rent-free period at the beginning of the lease term, and other agreements call for rent to be prepaid for a specified period. If, and to the extent the payment terms call for fixed escalations (as in fixed dollar or fixed percentage increases), the effect of such increases is recognized on a straight-line basis over the appropriate lease term. As a result of this accounting method, a portion of the revenue and expense recognized in a given period represents cash collected or paid in other periods.
A summary of the non-cash portions of our site rental revenues, ground lease expense and resulting impact on site rental gross margins is as follows:
(dollars in thousands) For the For the
Three Months Twelve Months
Ended Ended
Dec. 31, 2005 Dec. 31, 2005
Non-Cash portion of site rental revenues:
Amounts attributable to rent-free periods $1,650 $6,971
Amounts attributable to straight-line
recognition of fixed escalations $2,006 $9,085
$3,656 $16,056
Non-Cash portion of ground lease expense:
Amounts attributable to straight-line
recognition of fixed escalations $4,018 $17,013
Non-Cash compensation charges $93 $715
Non-Cash impact on site rental gross margins: $(455) $(1,672)
Non-GAAP Financial Measures
This press release includes presentations of Adjusted EBITDA and recurring cash flow, which are non-GAAP financial measures.
Crown Castle defines Adjusted EBITDA as net income (loss) plus cumulative effect of change in accounting principle, income (loss) from discontinued operations, minority interests, (provision) for income taxes, interest expense, amortization of deferred financing costs, interest and other income (expense), depreciation, amortization and accretion, operating non-cash compensation charges, asset write-down charges and restructuring charges (credits). Adjusted EBITDA is not intended as an alternative measure of cash flow from operations or operating results (as determined in accordance with Generally Accepted Accounting Principles (GAAP)).
Crown Castle defines recurring cash flow to be Adjusted EBITDA, less interest expense and less sustaining capital expenditures. Each of the amounts included in the calculation of recurring cash flow are computed in accordance with GAAP, with the exception of sustaining capital expenditures, which is not defined under GAAP. Sustaining capital expenditures are defined as capital expenditures (determined in accordance with GAAP) which do not increase the capacity or term of an asset. Recurring cash flow is not intended as an alternative measure of cash flow from operations or operating results (as determined in accordance with GAAP).
Adjusted EBITDA and recurring cash flow are presented as additional information because management believes these measures are useful indicators of the financial performance of our core businesses. In addition, Adjusted EBITDA is a measure of current financial performance used in our debt covenant calculations. Our measures of Adjusted EBITDA and recurring cash flow may not be comparable to similarly titled measures of other companies. The tables set forth below reconcile these non-GAAP financial measures to comparable GAAP financial measures.
Reconciliations of Non-GAAP Financial Measures to Comparable GAAP Financial Measures:
Adjusted EBITDA and recurring cash flow are computed as follows:
For the Three Months For the Twelve Months
Ended Ended
(dollars in thousands) Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2005 2004 2005 2004
(As restated) (As restated)
Net income (loss) $(23,303) $(87,651) $(401,537) $233,107
Cumulative effect of change
in accounting principle 9,031 --- 9,031 ---
Income (loss) from
discontinued operations,
net of tax --- 427 (848) (534,688)
Minority interests (760) (1,168) (3,525) (398)
Benefit (provision)
for income taxes 2,817 149 3,225 (5,370)
Interest expense and
amortization of deferred
financing costs 30,544 40,599 133,806 206,770
Interest and other income
(expense) (2,592) 37,985 282,443 78,264
Depreciation, amortization
and accretion 69,986 72,774 281,118 284,991
Operating non-cash
compensation charges 3,947 3,228 19,947 13,088
Asset write-down charges 773 3,836 2,925 7,652
Restructuring charges (credits) --- 4,207 8,477 3,729
Adjusted EBITDA $90,443 $74,386 $335,062 $287,145
Less: Interest expense and
amortization of deferred
financing costs 30,544 40,599 133,806 206,770
Less: Sustaining capital
expenditures 4,449 3,790 13,845 9,795
Recurring cash flow $55,450 $29,997 $187,411 $70,580
Recurring cash flow per share
is computed as follows:
(dollars and shares in thousands)
For the For the
Three Months Twelve Months
Ended Ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2005 2004 2005 2004
(As restated) (As restated)
Recurring cash flow $55,450 $29,997 $187,411 $70,580
Weighted average common
shares outstanding 213,532 222,783 217,759 221,693
Recurring cash flow per share $0.26 $0.13 $0.86 $0.32
Adjusted EBITDA and recurring cash flow for the quarter ending March 31,
2006 and the year ending December 31, 2006 are forecasted as follows:
(dollars in millions) Q1 2006 Outlook Full Year 2006 Outlook
Net income (loss) $(17) to (9) $(66) to (27)
Minority interests 0 to (1) 0 to (5)
Benefit (provision) for income taxes 0 to 1 1 to 3
Interest expense and amortization
of deferred financing costs 32 to 33 126 to 129
Interest and other income (expense) 0 to (1) 0 to 5
Depreciation, amortization
and accretion 70 to 72 280 to 300
Non-cash compensation charges 0 to 2 4 to 6
Asset write-down charges 0 to 2 4 to 6
Restructuring charges (credits) --- ---
Adjusted EBITDA $90 to 92 $378 to 388
Less: Interest expense 32 to 33 126 to 129
Less: Sustaining capital expenditures 4 to 5 11 to 15
Recurring cash flow $54 to 56 $234 to 244
Other Calculations:
Sustaining capital expenditures is computed as follows:
For the Three Months For the Twelve Months
Ended Ended
(dollars in thousands) Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2005 2004 2005 2004
(As restated) (As restated)
Capital expenditures $25,879 $14,111 $64,678 $42,918
Less: Revenue enhancing
on existing sites 8,766 7,623 22,690 23,592
Less: Land purchases 5,791 501 9,777 2,528
Less: New site construction 6,873 2,197 18,366 7,003
Sustaining capital expenditures $4,449 $3,790 $13,845 $9,795
Site rental gross margin for the quarter ending March 31, 2006 and for the
year ending December 31, 2006 is forecasted as follows:
(dollars in millions) Q1 2006 Full Year 2006
Outlook Outlook
Site rental revenue $159 to 161 $660 to 670
Less: Site rental cost of operations 50 to 52 208 to 212
Site rental gross margin $108 to 110 $450 to 460
Cautionary Language Regarding Forward-Looking Statements
This press release contains forward-looking statements and information that are based on our management's current expectations. Such statements include, but are not limited to, plans, projections and estimates regarding (i) growth in our business, demand for our towers and leasing rates and activity, (ii) the development and deployment of Modeo's broadcast network and service, including contemplated timing and services to be offered, (iii) the impact of the purchases of our securities, (iv) our capital investments, including the availability and type of investments and the impact of and return on our investments, (v) currency exchange rates, (vi) site rental revenue, (vii) site rental cost of operations, (viii) site rental gross margin, (ix) Adjusted EBITDA, (x) interest expense, (xi) sustaining capital expenditures, (xii) recurring cash flow (including recurring cash flow per share) and (xiv) net income (loss). Such forward-looking statements are subject to certain risks, uncertainties and assumptions, including but not limited to prevailing market conditions and the following:
* Our business depends on the demand for wireless communications and
towers, and we may be adversely affected by any slowdown in such
demand.
* The loss or consolidation of, network sharing among, or financial
instability of any of our limited number of customers may materially
decrease revenues.
* An economic or wireless telecommunications industry slowdown may
materially and adversely affect our business and the business of our
customers.
* Our substantial level of indebtedness may adversely affect our ability
to react to changes in our business and limit our ability to use debt
to fund future capital needs.
* We operate in a competitive industry, and some of our competitors have
significantly more resources or less debt than we do.
* Technology changes may significantly reduce the demand for site leases
and negatively impact the growth in our revenues.
* 2.5G/3G and other technologies may not deploy or be adopted by
customers as rapidly or in the manner projected.
* We generally lease or sublease the land under our sites and towers and
may not be able to extend these leases.
* We may need additional financing, which may not be available, for
strategic growth opportunities.
* Restrictive covenants on our debt instruments may limit our ability to
take actions that may be in our best interests.
* Modeo's business has certain risk factors different from our core
tower business, including an unproven business model, and may produce
results that are less than anticipated, resulting in a write off of
all or part of such business and its assets.
* FiberTower's business has certain risk factors different from our core
tower business, including an unproven business model, and may produce
results that are less than anticipated, resulting in a write off of
all or part of such investment.
* Laws and regulations, which may change at any time and with which we
may fail to comply, regulate our business.
* We are heavily dependent on our senior management.
* Our network services business has historically experienced significant
volatility in demand, which reduces the predictability of our results.
* We may suffer from future claims if radio frequency emissions from
wireless handsets or equipment on our towers are demonstrated to cause
negative health effects.
* 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.
* Sales or issuances of a substantial number of shares of our common
stock may adversely affect the market price of our common stock.
* Disputes with customers and suppliers may adversely affect results.
* Our operations in Australia expose us to changes in foreign currency
exchange rates.
Should one or more of these or other risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected. More information about potential risk factors which could affect our results is included in our filings with the Securities and Exchange Commission.
Crown Castle International Corp.
Unaudited Condensed Consolidated Statement of Operations
And Other Financial Data
(in thousands, except per share data)
Three Months Ended Years Ended
December 31, December 31,
2005 2004 2005 2004
(As restated) (As restated)
Net revenues:
Site rental $ 155,446 $ 139,755 $ 597,125 $ 538,309
Network services
and other 23,180 17,986 79,634 65,893
Total net revenues 178,626 157,741 676,759 604,202
Costs of operations
(exclusive of depreciation,
amortization and accretion):
Site rental (including
non-cash compensation
charges) 49,959 48,159 197,355 184,273
Network services and
other (including
non-cash compensation
charges) 15,426 12,894 54,630 46,752
General and administrative
(including non-cash
compensation charges) 24,959 25,096 105,763 97,665
Corporate development 1,786 434 3,896 1,455
Restructuring charges
(including non-cash
compensation charges) --- 4,207 8,477 3,729
Asset write-down charges 773 3,836 2,925 7,652
Depreciation, amortization
and accretion 69,986 72,774 281,118 284,991
Operating income (loss) 15,737 (9,659) 22,595 (22,315)
Interest and other income
(expense) 2,592 (37,985) (282,443) (78,264)
Interest expense and
amortization of deferred
financing costs (30,544) (40,599) (133,806) (206,770)
Income (loss) from
continuing operations
before income taxes
and minority interests (12,215) (88,243) (393,654) (307,349)
Benefit (provision)
for income taxes (2,817) (149) (3,225) 5,370
Minority interests 760 1,168 3,525 398
Income (loss) from
continuing operations (14,272) (87,224) (393,354) (301,581)
Discontinued operations:
Income (loss) from
discontinued operations,
net of tax --- (1,623) (1,953) 40,578
Net gain on disposal
of discontinued operations,
net of tax --- 1,196 2,801 494,110
Income (loss) from
discontinued
operations, net of tax --- (427) 848 534,688
Income (loss) before
cumulative effect of change
in accounting principle (14,272) (87,651) (392,506) 233,107
Cumulative effect of change
in accounting principle (9,031) --- (9,031) ---
Net income (loss) (23,303) (87,651) (401,537) 233,107
Dividends on preferred stock,
net of losses on purchases
of preferred stock. (20,706) (9,754) (49,356) (38,618)
Net loss after deduction
of dividends on preferred
stock $ (44,009) $(97,405) $(450,893) $ 194,489
Per common share
- basic and diluted:
Loss from continuing
operations $ (0.17) $ (0.43) $ (2.03) $ (1.54)
Income from discontinued
operations --- (0.01) --- 2.42
Cumulative effect of
change in accounting
principle (0.04) --- (0.04) ---
Net income (loss) $ (0.21) $ (0.44) $ (2.07) $ 0.88
Weighted average common
shares outstanding
- basic and diluted 213,532 222,783 217,759 221,693
Adjusted EBITDA $ 90,443 $ 74,386 $ 335,062 $ 287,145
Non-cash compensation
charges:
Site rental non-cash
compensation charges $ 93 $ 211 $ 715 $ 553
Network services
non-cash compensation
charges 44 107 349 280
General and
administrative non-cash
compensation charges 3,810 2,910 18,883 12,255
Total operating
non-cash compensation
charge 3,947 3,228 19,947 13,088
Restructuring non-cash
compensation charges --- 2,859 6,424 2,859
Total non-cash
compensation charges
from continuing
operations $ 3,947 $ 6,087 $ 26,371 $ 15,947
Crown Castle International Corp.
Unaudited Condensed Consolidated balance sheet
(in thousands)
December 31,
2005 2004
(As restated)
ASSETS
Current assets:
Cash and cash equivalents $65,408 $566,707
Receivables, net of allowance
for doubtful accounts 16,830 28,366
Deferred site rental receivable 9,307 6,395
Prepaid expenses and other current assets 37,811 33,552
Restricted cash (including amounts returned
on January 15, 2006 of $34,253) 91,939 ---
Assets of discontinued operations --- 3,693
Total current assets 221,295 638,713
Restricted cash 3,814 ---
Property and equipment,
net of accumulated depreciation 3,294,333 3,375,022
Goodwill 340,412 332,492
Deferred site rental receivable 87,392 82,343
Deferred financing costs and other assets,
net of accumulated amortization 184,071 145,997
$4,131,317 $4,574,567
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $12,230 $12,168
Accrued interest 8,281 43,308
Accrued compensation and related benefits 16,231 15,445
Deferred rental revenues
and other accrued liabilities 132,472 116,326
Liabilities of discontinued operations --- 568
Long-term debt, current maturities 295,000 97,250
Total current liabilities 464,214 285,065
Long-term debt, less current maturities 1,975,686 1,753,148
Deferred ground lease payable 118,747 102,502
Other liabilities 55,559 44,302
Total liabilities 2,614,206 2,185,017
Minority interests 26,792 32,016
Redeemable preferred stock 311,943 508,040
Stockholders' equity 1,178,376 1,849,494
$4,131,317 $4,574,567
Note: In accordance with the Indenture Agreement governing the Notes, all
rental cash receipts for the month are restricted and held by the
trustee. Amounts in excess of reserve balances as calculated by
the trustee are returned to the Company on the 15th of the
subsequent month.
Crown Castle International Corp.
Unaudited Condensed Consolidated Statement of Cash flows
(in thousands)
Twelve Months Ended
December 31,
2005 2004
(As restated)
Cash flows from operating activities:
Net income (loss) $(401,537) $233,107
Adjustments to reconcile net income (loss)
to net cash provided by (used for) operating
activities:
Depreciation, amortization and accretion 281,118 284,991
Losses on purchases of long-term debt 283,797 77,659
Non-cash compensation charges 26,371 15,947
Amortization of deferred financing costs
and discounts on long-term debt 6,174 9,512
Asset write-down charges 2,925 7,652
Equity in losses and write-downs
of unconsolidated affiliates 4,674 5,945
Loss (income) from discontinued operations (848) (534,688)
Minority interests (3,525) (398)
Interest rate swap termination payment 655 ---
Amortization of interest rate swap payment 572 ---
Cumulative effect of change in accounting principle 9,031 ---
Changes in assets and liabilities:
Increase (decrease) in accrued interest (35,027) (5,755)
Increase (decrease) in accounts payable 149 2,386
Increase (decrease) in deferred rental
revenues, deferred ground lease payables and
other liabilities 33,767 10,181
Decrease (increase) in receivables 11,221 20,557
Decrease (increase) in inventories,
prepaid expenses, deferred site rental
receivable and other assets (15,021) (8,774)
Net cash provided by (used for)
operating activities 204,496 118,322
Cash flows from investing activities:
Maturities of investments --- 517,500
Purchases of investments --- (490,900)
Proceeds from investments and disposition
of property and equipment 2,827 3,237
Acquisitions of assets and minority interest
in joint ventures (147,255) (295,000)
Capital expenditures (64,678) (42,918)
Investments in unconsolidated affiliates
and other (55,034) (11,119)
Net cash provided by (used for)
investing activities (264,140) (319,200)
Cash flows from financing activities:
Proceeds from issuance of long-term debt 1,900,000 ---
Proceeds from issuance of capital stock 59,054 32,094
Principal payments on long-term debt --- (1,289,750)
Purchases and redemptions of long-term debt (1,848,222) (353,958)
Purchases of common stock (314,889) (59,364)
Purchases and redemption of preferred stock (200,000) ---
Borrowings under revolving credit agreements 295,000 ---
Payments under revolving credit agreements (180,000) (15,000)
Incurrence of financing costs (32,405) (444)
Initial funding of restricted cash (48,873) ---
Net (increase) decrease in restricted cash (46,880) ---
Interest rate swap payments (6,381) ---
Dividends on preferred stock (21,624) ---
Net cash provided by (used for)
financing activities (445,220) (1,686,422)
Effect of exchange rate changes on cash (408) 1,178
Discontinued operations 3,973 2,043,245
Net decrease in cash and cash equivalents (501,299) 157,123
Cash and cash equivalents at beginning of period 566,707 409,584
Cash and cash equivalents at end of period $65,408 $566,707
Supplemental disclosure of cash flow information:
Interest paid $158,165 $199,836
Income taxes paid (refund) (including ($2,385)
and $11,000 related to CCUK) (1,864) 11,630
CROWN CASTLE INTERNATIONAL CORP.
Summary Fact Sheet
(in $ thousands)
Quarter Ended 3/31/05
CCUSA CCAL EmB CCIC
Revenues
Site Rental 131,189 10,218 61 141,468
Services 14,138 2,041 --- 16,179
Total Revenues 145,327 12,259 61 157,647
Operating Expenses
Site Rental 43,600 4,644 79 48,323
Services 10,277 915 276 11,468
Total Operating Expenses 53,877 5,559 355 59,791
General & Administrative 19,058 2,836 652 22,546
Operating Cash Flow 72,392 3,864 (946) 75,310
Corporate Development --- --- 432 432
Add: Non-Cash Compensation 1,505 14 28 1,547
Adjusted EBITDA 73,897 3,878 (1,350) 76,425
Quarter Ended 3/31/05
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 67% 55% N/M 66%
Services 27% 55% N/M 29%
Operating Cash Flow Margins 50% 32% N/M 48%
Adjusted EBITDA Margin 51% 32% N/M 48%
CROWN CASTLE INTERNATIONAL CORP.
Summary Fact Sheet
(in $ thousands)
Quarter Ended 6/30/05
CCUSA CCAL EmB CCIC
Revenues
Site Rental 134,037 13,305 67 147,409
Services 19,082 1,736 --- 20,818
Total Revenues 153,119 15,041 67 168,227
Operating Expenses
Site Rental 43,839 4,441 122 48,402
Services 13,092 924 387 14,403
Total Operating Expenses 56,931 5,365 509 62,805
General & Administrative 19,966 3,256 778 24,000
Operating Cash Flow 76,222 6,420 (1,220) 81,422
Corporate Development --- --- 787 787
Add: Non-Cash Compensation 1,623 107 133 1,863
Adjusted EBITDA 77,845 6,527 (1,874) 82,498
Quarter Ended 6/30/05
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 67% 67% N/M 67%
Services 31% 47% N/M 31%
Operating Cash Flow Margins 50% 43% N/M 48%
Adjusted EBITDA Margin 51% 43% N/M 49%
CROWN CASTLE INTERNATIONAL CORP.
Summary Fact Sheet
(in $ thousands)
Quarter Ended 9/30/05
CCUSA CCAL EmB CCIC
Revenues
Site Rental 140,294 12,444 64 152,802
Services 17,519 1,938 --- 19,457
Total Revenues 157,813 14,382 64 172,259
Operating Expenses
Site Rental 46,242 4,314 115 50,671
Services 12,048 754 531 13,333
Total Operating Expenses 58,290 5,068 646 64,004
General & Administrative 30,039 2,835 1,384 34,258
Operating Cash Flow 69,484 6,479 (1,966) 73,997
Corporate Development --- --- 891 891
Add: Non-Cash Compensation 11,822 109 659 12,590
Adjusted EBITDA 81,306 6,588 (2,198) 85,696
Quarter Ended 9/30/05
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 67% 65% N/M 67%
Services 31% 61% N/M 31%
Operating Cash Flow Margins 44% 45% N/M 43%
Adjusted EBITDA Margin 52% 46% N/M 50%
CROWN CASTLE INTERNATIONAL CORP.
Summary Fact Sheet
(in $ thousands)
Quarter Ended 12/31/05
CCUSA CCAL EmB CCIC
Revenues
Site Rental 143,843 11,513 89 155,446
Services 21,797 1,382 --- 23,180
Total Revenues 165,641 12,896 89 178,626
Operating Expenses
Site Rental 45,356 4,299 304 49,959
Services 14,361 733 332 15,426
Total Operating Expenses 59,717 5,033 636 65,385
General & Administrative 21,219 2,861 880 24,959
Operating Cash Flow 84,705 5,002 (1,426) 88,281
Corporate Development 194 --- 1,592 1,786
Add: Non-Cash Compensation 3,686 114 147 3,947
Adjusted EBITDA 88,197 5,116 (2,871) 90,443
Quarter Ended 12/31/05
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 68% 63% N/M 68%
Services 34% 47% N/M 33%
Operating Cash Flow Margins 51% 39% N/M 49%
Adjusted EBITDA Margin 53% 40% N/M 51%
Reconciliation of Non-GAAP Financial Measure (Adjusted EBITDA) to GAAP
Financial Measure:
(in $ thousands)
Quarter Ended
3/31/2005 6/30/2005 9/30/2005 12/31/2005
Net income (loss) $(126,947) $(225,751) $(25,536) $(23,303)
Income (loss) from
discontinued operations, net
of tax 1,499 (2,347) --- ---
Minority interests (1,204) (727) (834) (760)
Credit (provision) for income
taxes 144 147 117 2,817
Interest expense, amortization
of deferred financing costs 39,269 35,393 28,600 30,544
Interest and other income
(expense) 83,017 202,635 (617) (2,592)
Depreciation, amortization and
accretion 70,187 70,730 70,215 69,986
Operating non-cash
compensation charges 1,547 1,863 12,590 3,947
Asset write-down charges 436 555 1,161 773
Cumulative effect of change in
accounting principle --- --- --- 9,031
Restructuring charges
(credits) 8,477 --- --- ---
Adjusted EBITDA $76,425 $82,498 $85,696 $90,443
CCI FACT SHEET Q4 2005
$ in thousands
Q4 '04 Q4 '05 %Change
CCUSA
Site Rental Revenue $129,242 $143,843 11%
Ending Sites 10,612 11,074 4%
CCAL
Site Rental Revenue $10,513 $11,513 10%
Ending Sites 1,388 1,385 0%
CC EmB
Site Rental Revenue $0 $89 N/A
Ending Sites --- --- N/A
TOTAL CCIC
Site Rental Revenue $139,755 $155,446 11%
Ending Sites 12,000 12,459 4%
Ending Cash and Investments $566,707 $65,408*
Debt
Bank Debt $97,250 $295,000
Bonds $1,753,148 $1,975,686
6 1/4% & 8 1/4% Convertible
Preferred Stock $508,040 $311,943
Total Debt $2,358,438 $2,582,629
Leverage Ratios
Net Bank Debt / Adjusted EBITDA N/A N/A
Net Bank Debt + Bonds / Adjusted
EBITDA 4.3X 6.1X
Total Net Debt / Adjusted EBITDA 6.0X 7.0X
Last Quarter Annualized Adjusted
EBITDA $297,544 $361,771
*Excludes Restricted Cash of $95.8 million
SOURCE Crown Castle International
W. Benjamin Moreland, CFO, or Jay Brown, Treasurer, both of Crown Castle International Corp., +1-713-570-3000
http://www.prnewswire.com