Crown Castle International Reports Third Quarter 2005 Results
HOUSTON, Oct. 26 /PRNewswire-FirstCall/ -- Crown Castle International Corp. (NYSE: CCI) today reported results for the third quarter ended September 30, 2005.
Site rental revenue for the third quarter of 2005 increased 12.6% percent to $152.3 million, up $17.0 million from $135.2 million for the same period in the prior year. Site rental gross margin, defined as site rental revenue less site rental cost of operations, increased 14.3% to $102.2 million, up $12.8 million in the third quarter of 2005 from the same period in 2004. Adjusted EBITDA for the third quarter of 2005 increased $13.8 million, or 19.2%, to $85.8 million, up from $72.0 million for the same period in 2004.
Recurring cash flow, defined as Adjusted EBITDA less interest expense less sustaining capital expenditures, increased $35.5 million to $53.7 million for the third quarter of 2005, compared to $18.2 million for the third quarter of 2004. Weighted average common shares outstanding decreased to 215.7 million for the third 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 $0.25 in the third quarter of 2005 compared to $0.08 in the third quarter of 2004.
Net loss was $28.1 million for the third quarter of 2005, inclusive of a $2.7 million loss from the retirement of debt, compared to a net income of $450.7 million for last year's third quarter, inclusive of $509.1 million of income from discontinued operations and a $13.9 million loss from the retirement of debt. Net loss after deduction of dividends on preferred stock was $37.5 million in the third quarter of 2005, inclusive of a $2.7 million loss from the retirement of debt, compared to net income after deduction of dividends on preferred stock of $440.8 million for the same period last year, inclusive of $509.1 million of income from discontinued operations and a $13.9 million loss from the retirement of debt. Third quarter 2005 net loss per share was $(0.17), compared to net income per share of $1.98 in last year's third quarter, inclusive of $2.29 per share in income from discontinued operations.
"During the last four quarters, we have more than tripled recurring cash flow per share through the achievement of 13% site rental revenue growth, a 45% decrease in interest expense and purchases of our common shares," stated John P. Kelly, President and Chief Executive Officer of Crown Castle. "We remain focused on maximizing recurring cash flow per share as we believe it is the best measure of shareholder value. On the operational side, we are very pleased with the amount of new recurring revenue in the third quarter, as we added more tenants to our towers than we had forecasted."
OPERATING RESULTS
US site rental revenue for the third quarter of 2005 increased $14.3 million, or 11.4%, to $139.8 million, compared to third quarter 2004 US site rental revenue of $125.5 million. US site rental gross margin increased 13.2% to $94.1 million, up $11.0 million in the third quarter of 2005 from the same period in 2004.
Australia site rental revenue for the third quarter of 2005 increased $2.7 million, or 28.0%, to $12.4 million, up from $9.7 million for the same period in 2004. Australia site rental gross margin increased 30.1% to $8.1 million, up $1.9 million in the third quarter of 2005 from the same period in 2004.
INVESTMENTS
During the third quarter of 2005, Crown Castle invested $129.4 million in capital expenditures and purchases of its common stock. During the quarter, Crown Castle purchased approximately 4.7 million shares of its common stock using approximately $112.5 million in cash, an average of $23.98 per share. Common shares outstanding - basic and diluted - were 213.4 million on September 30, 2005. During the third quarter of 2005, Crown Castle spent $16.9 million on capital expenditures, comprised of $3.5 million of sustaining capital expenditures and $13.4 million of revenue generating capital expenditures, of which $5.5 million was spent on existing sites, $2.9 million on land purchases and $5.0 million on the construction of new sites.
Also, as previously announced, during the third quarter, Crown Castle acquired 467 towers from TrinTel Communications, Inc. ("TrinTel") for approximately $145 million in cash. The acquired TrinTel portfolio currently produces approximately $14 million in annualized site rental revenue and approximately $9 million in annualized site rental gross margin. Further, Crown Castle made an additional investment of $55 million in FiberTower Corporation ("FiberTower"), as part of a total of $150 million that FiberTower raised through an equity offering. Crown Castle retains approximately 32%, on a fully diluted basis, of FiberTower and remains FiberTower's largest shareholder.
"We continue to invest our cash in investments that we believe will maximize long-term recurring cash flow per share," stated Ben Moreland, Chief Financial Officer of Crown Castle. "Over the last 12 months, we have invested nearly $600 million in the purchase of our common shares and 4% Convertible Notes representing shares that were in the money. These investments will have a compounding long-term impact on recurring cash flow per share as the revenues and resulting cash flow that we expect to produce will now be spread among fewer common shares outstanding. Based on our current run-rates and outlook for 2006, we expect we will invest over $100 million per quarter in a combination of capital expenditures on our existing towers, the acquisition and construction of new towers, and the purchase of our common shares. We remain focused on our long-term goal of 20% to 25% annual growth in recurring cash flow per share through the expected growth in our core tower business and related investments."
On August 1, 2005, Crown Castle completed a $275 million revolving credit facility. Borrowings under the credit facility may be used for general corporate purposes, including capital expenditures, acquisitions, common stock purchases and dividends. Under the terms of the facility, Crown Castle may use up to $100 million of borrowings for stock purchases and dividends. Borrowings under the facility will bear interest at a rate per annum of 200 to 275 basis points (based on interest expense coverage) plus LIBOR. Crown Castle currently has $145 million drawn under the credit facility, which was used to fund the Trintel acquisition.
OUTLOOK
The following statements and outlook tables are based on current expectations and assumptions and assume a US dollar to Australian dollar exchange rate of 0.76 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 following table sets forth Crown Castle's current outlook for the fourth quarter of 2005 and full year 2005:
(dollars in millions)
Fourth Quarter Full Year
2005 2005
Site Rental Revenue $155 to 157 $595 to 597
Site Rental Cost of Operations $50 to 52 $195 to 197
Site Rental Gross Margin $104 to 106 $399 to 401
Adjusted EBITDA $87 to 89 $332 to 334
Interest Expense $28 to 30 $131 to 133
Sustaining Capital Expenditures $3 to 5 $12 to 14
Recurring Cash Flow $54 to 56 $186 to 188
Revenue Generating Capital Expenditures:
Revenue Enhancing on Existing Sites $5 to 7 $19 to 21
Land Purchases $5 to 7 $9 to 11
New Site Construction $4 to 6 $15 to 17
Total Revenue Generating Capital Expenditures $14 to 20 $43 to 49
The following table sets forth Crown Castle's current outlook for full
year 2006:
(dollars in millions) Full Year
2006
Site Rental Revenue $655 to 665
Site Rental Cost of Operations $208 to 212
Site Rental Gross Margin $445 to 455
Adjusted EBITDA $370 to 380
Interest Expense $115 to 120
Sustaining Capital Expenditures $11 to 15
Recurring Cash Flow $235 to 245
Crown Castle has not provided outlook for 2006 capital expenditures, except for sustaining capital expenditures. Crown Castle expects to invest approximately $450 million to $500 million during 2006, which it expects to fund from recurring cash flow and borrowings of five to seven times its expected growth in Adjusted EBITDA. These investments are likely to consist of capital expenditures on existing towers, the purchase of land beneath existing towers, the construction of new towers, the acquisition of towers, the purchase of common stock, and the redemption of the 8 1/4% Convertible Preferred Stock that would eliminate potential share dilution. Crown Castle's 2006 Outlook for interest expense does not include the impact of potential borrowings.
CONFERENCE CALL DETAILS
Crown Castle has scheduled a conference call for Thursday, October 27, 2005, at 10:30 a.m. eastern time to discuss third quarter results and Crown Castle's outlook. Please dial 303-205-0044 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 from 12:30 p.m. eastern time on Thursday, October 27, 2005, through 11:59 p.m. eastern time on Thursday, November 3, 2005, and may be accessed by dialing 303-590-3000 using pass code 11041238#. An audio archive will also be available on the company'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 and rooftops. Crown Castle offers significant wireless communications coverage to 68 of the top 100 United States markets and to substantially all of the Australian population. Crown Castle owns, operates and manages over 11,000 and 1,300 wireless communication sites in the U.S. and Australia, respectively. For more information on Crown Castle 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 is 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.
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:
For the Three
(dollars in thousands) Months Ended
September 30, 2005
Non-Cash portion of site rental revenues:
Amounts attributable to rent-free periods $1,575
Amounts attributable to straight-line
recognition of fixed escalations $2,515
$4,090
Non-Cash portion of ground lease expense:
Amounts attributable to straight-line
recognition of fixed escalations $3,793
Non-Cash compensation charges 504
Non-Cash impact on site rental gross margins: $(207)
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, credit (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 operating results (as determined in accordance with Generally Accepted Accounting Principles (GAAP)). Adjusted EBITDA is presented as additional information because management believes it to be a useful indicator of the current financial performance of our core businesses. In addition, Adjusted EBITDA is the measure of current financial performance generally used in our debt covenant calculations.
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 (as determined in accordance with GAAP). Recurring cash flow is provided as additional information because management believes it to be useful in providing investors with a reasonable estimate of our cash flow available for discretionary investments (including expansion projects, improvements to existing sites, debt repayment, securities purchases and dividends) without reliance on additional borrowing or the use of our cash and cash equivalents.
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 is computed as follows: For the Three Months Ended
(dollars in thousands) September 30, September 30,
2005 2004
Net income (loss) $(28,066) $450,656
Income (loss) from discontinued operations,
net of tax 1,497 (509,140)
Minority interests (904) 544
Credit (provision) for income taxes 117 (6,856)
Interest expense and amortization
of deferred financing costs 28,600 52,281
Interest and other income (expense) (617) 13,552
Depreciation, amortization and accretion 72,192 69,925
Operating non-cash compensation charges 11,816 1,442
Asset write-down charges 1,161 ---
Restructuring charges (credits) --- (445)
Adjusted EBITDA $85,796 $71,959
Recurring Cash Flow is computed as follows: For the Three Months Ended
(dollars in thousands) September 30, September 30,
2005 2004
Net cash provided by operating activities $47,167 $20,705
Add: Other adjustments(A) 10,032 (1,027)
Less: Sustaining capital expenditures (3,468) (1,433)
Recurring Cash Flow $53,731 $18,245
(A) Other adjustments include adjustments for changes in assets and
liabilities, excluding the effects of acquisitions, restructuring
charges and provision for income taxes.
Recurring Cash Flow per share
is computed as follows: For the Three Months Ended
(dollars and shares in thousands) September 30, September 30,
2005 2004
Recurring Cash Flow $53,731 $18,245
Weighted average common shares outstanding 215,664 222,841
Recurring Cash Flow per share $0.25 $0.08
Sustaining Capital Expenditures
is computed as follows: For the Three Months Ended
(dollars in thousands) September 30, September 30,
2005 2004
Capital expenditures $16,867 $9,563
Less: Revenue enhancing on existing sites (5,495) (4,937)
Less: Land purchases (2,868) (1,917)
Less: New site construction (5,036) (1,276)
Sustaining Capital Expenditures $3,468 $1,433
Adjusted EBITDA for the quarter ending December 31, 2005 and the years ending December 31, 2005 and December 31, 2006 is forecasted as follows:
Q4 2005 Full Year 2005 Full Year 2006
(dollars in millions) Outlook Outlook Outlook
Net income (loss) $(24) to (11) $(408) to (394) $(78) to (33)
Minority interests (1) to (2) (4) to (5) 0 to (5)
Credit (provision) for
income taxes 0.1 to 0.2 0.5 to 0.6 0 to 1
Interest expense and
amortization of deferred
financing costs 28 to 30 131 to 133 115 to 120
Interest and other
income (expense) 0 to 2 285 to 287 0 to 5
Depreciation,
amortization and accretion 72 to 77 289 to 294 290 to 315
Operating non-cash
compensation charges 1 to 2 16 to 17 4 to 6
Asset write-down charges 0 to 2 2 to 4 4 to 6
Restructuring charges
(credits) --- 8 to 9 ---
Adjusted EBITDA $87 to 89 $332 to 334 $370 to 380
Recurring Cash Flow for the quarter ending December 31, 2005 and the years ending December 31, 2005 and December 31, 2006 is forecasted as follows:
(dollars in millions) Q4 2005 Full Year 2005 Full Year 2006
Outlook Outlook Outlook
Net cash provided by $54 to 59 $163 to 168 $226 to 260
operating activities
Add: Other adjustments (A) 0 to 5 30 to 39 0 to 20
Less: Sustaining capital
expenditures (3) to (5) (12) to (14) (11) to (15)
Recurring Cash Flow $54 to 56 $186 to 188 $235 to 245
(A) Other adjustments include adjustments for changes in assets and
liabilities, excluding the effects of acquisitions, restructuring
charges and provision for income taxes.
Other Calculations:
Sustaining Capital Expenditures for the quarter ending December 31, 2005 and the year ending December 31, 2005 is forecasted as follows:
(dollars in millions) Q4 2005 Full Year 2005
Outlook Outlook
Capital expenditures $17 to 25 $55 to 63
Less: Revenue enhancing (5) to (7) (19) to (21)
on existing sites
Less: Land purchases (5) to (7) (9) to (11)
Less: New site (4) to (6) (15) to (17)
construction
Sustaining Capital $3 to 5 $12 to 14
Expenditures
Site Rental Gross Margin for the quarter ending December 31, 2005 and for
the years ending December 31, 2005 and December 31, 2006 is forecasted as
follows:
(dollars in millions) Q4 2005 Full Year 2005 Full Year 2006
Outlook Outlook Outlook
Site rental revenue $155 to 157 $595 to 597 $655 to 665
Less: Site rental cost
of operations (50) to (52) (195) to (197) (208) to (212)
Site Rental Gross Margin $104 to 106 $399 to 401 $445 to 455
Recurring Cash Flow for the quarter ending December 31, 2005 and for the years ending December 31, 2005 and December 31, 2006 is forecasted as follows:
(dollars in millions) Q4 2005 Full Year 2005 Full Year 2006
Outlook Outlook Outlook
Adjusted EBITDA $87 to 89 $332 to 334 $370 to 380
Less: Interest expense (28) to (30) (131) to (133) (115) to (120)
Less: Sustaining capital
expenditures (3) to (5) (12) to (14) (11) to (15)
Recurring Cash Flow $54 to 56 $186 to 188 $235 to 245
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) investments, including the availability of appropriate investments and the impact of and return on our investments, (iii) currency exchange rates, (iv) site rental revenue, (v) customer payments, (vi) site rental cost of operations, (vii) site rental gross margin, (viii) Adjusted EBITDA, (ix) interest expense, (x) sustaining capital expenditures, (xi) recurring cash flow (including recurring cash flow per share), (xii) revenue enhancing capital expenditures on existing sites, (xiii) land purchases, (xiv) new site construction, and (xv) revenue generating capital expenditures. 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
* 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.
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.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
AND OTHER FINANCIAL DATA
(in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2005 2004 2005 2004
Net revenues:
Site rental $152,260 $135,229 $440,053 $397,916
Network services
and other 19,457 14,956 56,454 47,907
Total net revenues 171,717 150,185 496,507 445,823
Costs of operations
(exclusive of depreciation,
amortization and accretion):
Site rental (including
non-cash compensation
charges) 50,029 45,804 145,468 136,024
Network services and
other (including
non-cash compensation
charges) 13,333 10,717 39,204 33,858
Total costs of
operations 63,362 56,521 184,672 169,882
General and administrative
(including non-cash
compensation charges) 33,484 22,936 79,921 72,569
Corporate development 891 211 2,110 1,021
Restructuring charges
(credits) (including
non-cash compensation
charges) --- (445) 8,477 (478)
Asset write-down charges 1,161 --- 2,152 3,816
Depreciation, amortization
and accretion 72,192 69,925 217,076 211,141
Operating income (loss) 627 1,037 2,099 (12,128)
Interest and other income
(expense) 617 (13,552) (285,035) (40,279)
Interest expense and
amortization of deferred
financing costs (28,600) (52,281) (103,262) (166,171)
Loss from continuing
operations before
income taxes and
minority interests (27,356) (64,796) (386,198) (218,578)
Benefit (provision) for
income taxes (117) 6,856 (408) 5,519
Minority interests 904 (544) 2,977 (952)
Loss from continuing
operations (26,569) (58,484) (383,629) (214,011)
Income (loss) from
discontinued operations,
net of tax (1,497) 509,140 (649) 537,250
Net income (loss) (28,066) 450,656 (384,278) 323,239
Dividends on preferred
stock (9,429) (9,836) (28,650) (28,864)
Net loss after deduction
of dividends on preferred
stock $(37,495) $440,820 $(412,928) $294,375
Per common share
-- basic and diluted:
Loss from continuing
operations $ (0.17) $ (0.31) $ (1.88) $ (1.10)
Income from discontinued
operations --- 2.29 --- 2.43
Net income (loss) $ (0.17) $ 1.98 $ (1.88) $ 1.33
Common shares outstanding
-- basic and diluted 215,664 222,841 219,167 221,329
Adjusted EBITDA
(before restructuring and
asset write-down charges):
Site rental $ 95,012 $ 82,756 $ 272,384 $241,570
Network services
and other (9,216) (10,797) (27,463) (29,359)
Total Adjusted EBITDA $ 85,796 $ 71,959 $ 244,921 $212,211
Non-cash compensation
charges:
Site rental non-cash
compensation charges $ 504 $ 50 $ 622 $ 342
Network services non-cash
compensation charges 246 25 305 173
General and administrative
non-cash compensation
charges 11,066 1,367 14,190 9,345
Total operating non-cash
compensation charge 11,816 1,442 15,117 9,860
Restructuring non-cash
compensation charges --- --- 6,424 ---
Total non-cash
compensation charges
from continuing
operations $ 11,816 $ 1,442 $ 21,541 $ 9,860
CROWN CASTLE INTERNATIONAL CORP.
CONDENSED CONSOLIDATED BALANCE SHEET
(in thousands)
September 30, December 31,
2005 2004
ASSETS
Current assets:
Cash and cash equivalents $ 71,350 $ 566,707
Receivables, net of allowance
for doubtful accounts 15,243 28,366
Inventories 3,732 4,781
Deferred site rental receivable 5,354 6,395
Prepaid expenses and other
current assets 34,300 28,771
Restricted cash (including amounts
returned on October 15, 2005
of $24,905) 77,542 ---
Assets of discontinued operations --- 3,693
Total current assets 207,521 638,713
Restricted cash 3,154 ---
Property and equipment, net of
accumulated depreciation 3,326,801 3,368,166
Goodwill 341,936 333,718
Deferred site rental receivable 90,875 84,928
Deferred financing costs and
other assets, net of accumulated
amortization 192,684 145,997
$4,162,971 $4,571,522
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 11,064 $ 12,168
Accrued interest 6,323 43,308
Accrued compensation and
related benefits 12,554 15,445
Deferred rental revenues and
other accrued liabilities 109,966 116,326
Liabilities of discontinued
operations --- 568
Long-term debt, current maturities 145,000 97,250
Total current liabilities 284,907 285,065
Long-term debt, less current
maturities 1,975,686 1,753,148
Deferred ground lease payable 127,607 116,874
Other liabilities 38,954 44,302
Total liabilities 2,427,154 2,199,389
Minority interests 27,516 30,468
Redeemable preferred stock 509,043 508,040
Stockholders' equity 1,199,258 1,833,625
$4,162,971 $4,571,522
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.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands)
Nine Months Ended
September 30,
2005 2004
Cash flows from operating activities:
Net income (loss) $(384,278) $323,239
Adjustments to reconcile net loss
to net cash provided by operating
activities:
Depreciation, amortization
and accretion 217,076 211,141
Losses on purchases of
long-term debt 283,797 38,253
Amortization of deferred financing
costs and discounts on
long-term debt 4,174 7,978
Non-cash compensation charges 21,541 9,860
Asset write-down charges 2,152 3,816
Minority interests (2,977) 952
Equity in losses and write-downs of
unconsolidated affiliates 3,365 3,991
Loss (income) from discontinued
operations 649 (537,250)
Interest rate swap termination payment 655 ---
Amortization of interest rate
swap payment 286 ---
Changes in assets and liabilities:
Increase (decrease) in accrued
interest (36,985) (16,504)
Increase (decrease) in accounts
payable (1,080) (1,040)
Increase (decrease) in deferred
rental revenues, deferred
ground lease payables and other
liabilities (2,336) 1,257
Decrease (increase) in receivables 12,984 6,291
Decrease (increase) in inventories,
prepaid expenses, deferred site
rental receivable and other assets (10,285) (5,808)
Net cash provided by (used for)
operating activities 108,738 46,176
Cash flows from investing activities:
Proceeds from investments and
disposition of property and equipment 1,968 2,726
Capital expenditures (38,799) (28,807)
Investments in affiliates and other (55,034) (11,119)
Maturities of investments --- 250,100
Purchases of investments --- (375,000)
Acquisitions of assets (144,580) ---
Net cash provided by (used for)
investing activities (236,445) (162,100)
Cash flows from financing activities:
Proceeds from issuance of
long-term debt 1,900,000 ---
Proceeds from issuance of
capital stock 37,044 30,074
Purchases and redemption of
long-term debt (1,848,222) (267,359)
Borrowings under revolving credit
agreements 145,000 ---
Payments under revolving credit
agreements (180,000) (15,000)
Purchases of capital stock (292,718) (52,990)
Principal payments on long-term debt --- (1,289,750)
Incurrence of financing costs (31,973) (444)
Initial funding of restricted cash (48,873) ---
Net (increase) decrease in
restricted cash (31,823) ---
Interest rate swap payments (6,381) ---
Dividends on preferred stock (13,220) ---
Net cash provided by (used for)
financing activities (371,166) (1,595,469)
Effect of exchange rate changes on cash (457) (105)
Discontinued operations 3,973 2,058,919
Net decrease in cash and
cash equivalents (495,357) 347,421
Cash and cash equivalents at
beginning of period 566,707 409,584
Cash and cash equivalents at
end of period $ 71,350 $757,005
Supplemental disclosure of cash
flow information:
Interest paid $132,748 $172,376
Income taxes paid 7,408 481
CROWN CASTLE INTERNATIONAL CORP.
Summary Fact Sheet
(in $ thousands)
Quarter Ended 12/31/04
CCUSA CCAL EmB CCIC
Revenues
Site Rental 128,838 10,711 --- 139,549
Services 16,907 1,003 76 17,986
Total Revenues 145,745 11,714 76 157,535
Operating Expenses
Site Rental 43,474 4,655 --- 48,129
Services 11,494 825 575 12,894
Total Operating Expenses 54,968 5,480 575 61,023
General & Administrative
Site Rental 4,629 3,039 --- 7,668
Services 16,303 --- 1,125 17,428
Total General & Administrative 20,932 3,039 1,125 25,096
Operating Cash Flow 69,845 3,195 (1,624) 71,416
Corporate Development 434 --- --- 434
Add: Non-Cash Compensation 3,212 16 --- 3,228
Adjusted EBITDA 72,623 3,211 (1,624) 74,210
Quarter Ended 12/31/04
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 66% 57% N/M 66%
Services 32% 18% N/M 28%
Operating Cash Flow Margins 48% 27% N/M 45%
Adjusted EBITDA Margin 50% 27% N/M 47%
Quarter Ended 3/31/05
CCUSA CCAL EmB CCIC
Revenues
Site Rental 130,692 10,173 61 140,926
Services 14,138 2,041 --- 16,179
Total Revenues 144,830 12,214 61 157,105
Operating Expenses
Site Rental 43,011 4,590 79 47,680
Services 10,277 915 276 11,468
Total Operating Expenses 53,288 5,505 355 59,148
General & Administrative
Site Rental 4,472 2,836 --- 7,308
Services 14,587 --- 652 15,239
Total General & Administrative 19,059 2,836 652 22,547
Operating Cash Flow 72,483 3,873 (946) 75,410
Corporate Development --- --- 432 432
Add: Non-Cash Compensation 1,506 14 28 1,548
Adjusted EBITDA 73,989 3,887 (1,350) 76,526
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 49%
Quarter Ended 6/30/05
CCUSA CCAL EmB CCIC
Revenues
Site Rental 133,540 13,260 67 146,867
Services 19,082 1,736 --- 20,818
Total Revenues 152,622 14,996 67 167,685
Operating Expenses
Site Rental 43,250 4,387 122 47,759
Services 13,092 924 387 14,403
Total Operating Expenses 56,342 5,311 509 62,162
General & Administrative
Site Rental 4,657 3,256 --- 7,913
Services 15,199 --- 778 15,977
Total General & Administrative 19,856 3,256 778 23,890
Operating Cash Flow 76,424 6,429 (1,220) 81,633
Corporate Development --- --- 787 787
Add: Non-Cash Compensation 1,513 107 133 1,753
Adjusted EBITDA 77,937 6,536 (1,874) 82,599
Quarter Ended 6/30/05
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 68% 67% N/M 67%
Services 31% 47% N/M 31%
Operating Cash Flow Margins 50% 43% N/M 49%
Adjusted EBITDA Margin 51% 44% N/M 49%
Quarter Ended 9/30/05
CCUSA CCAL EmB CCIC
Revenues
Site Rental 139,797 12,399 64 152,260
Services 17,519 1,938 --- 19,457
Total Revenues 157,316 14,337 64 171,717
Operating Expenses
Site Rental 45,653 4,261 115 50,029
Services 12,048 754 531 13,333
Total Operating Expenses 57,701 5,015 646 63,362
General & Administrative
Site Rental 4,997 2,835 --- 7,832
Services 24,268 --- 1,384 25,652
Total General & Administrative 29,265 2,835 1,384 33,484
Operating Cash Flow 70,350 6,487 (1,966) 74,871
Corporate Development --- --- 891 891
Add: Non-Cash Compensation 11,048 109 659 11,816
Adjusted EBITDA 81,398 6,596 (2,198) 85,796
Quarter Ended 9/30/05
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 67% 66% N/M 67%
Services 31% 61% N/M 31%
Operating Cash Flow Margins 45% 45% N/M 44%
Adjusted EBITDA Margin 52% 46% N/M 50%
Reconciliation of Non-GAAP Financial Measure (Adjusted EBITDA) to GAAP
Financial Measure:
(in $ thousands)
Quarter Ended
12/31/2004 03/31/2005 06/30/2005 09/30/2005
Net income (loss) $ (88,129) $(128,761) $(227,451) $(28,066)
Income (loss) from
discontinued operations,
net of tax 1,065 1,499 (2,347) 1,497
Minority interests (1,154) (1,275) (798) (904)
Credit (provision) for
income taxes 149 144 147 117
Interest expense,
amortization of deferred
financing costs 40,599 39,269 35,393 28,600
Interest and other
income (expense) 37,985 83,017 202,635 (617)
Depreciation, amortization
and accretion 72,424 72,172 72,712 72,192
Operating non-cash
compensation charges 3,228 1,548 1,753 11,816
Asset write-down charges 3,836 436 555 1,161
Restructuring charges
(credits) 4,207 8,477 --- ---
Adjusted EBITDA $ 74,210 $ 76,526 $ 82,599 $ 85,796
CCI FACT SHEET Q3 2005
$ in thousands
Q3 '04 Q3 '05 % Change
CCUSA
Site Rental Revenue $ 125,546 $ 139,797 11%
Ending Sites 10,609 11,070 4%
CCAL
Site Rental Revenue $ 9,683 $ 12,399 28%
Ending Sites 1,388 1,386 0%
CC EmB
Site Rental Revenue $ --- 64 N/A
Ending Sites --- --- N/A
TOTAL CCIC
Site Rental Revenue $ 135,229 $ 152,260 13%
Ending Sites 11,997 12,456 4%
Ending Cash and Investments $757,005 $71,350 *
Debt
Bank Debt $180,000 $145,000
Tower Revenue Notes & Bonds $1,718,847 $1,975,686
6 1/4% & 8 1/4% Convertible
Preferred Stock $507,706 $509,043
Total Debt $2,406,553 $2,629,729
Leverage Ratios
Net Bank Debt / EBITDA N/A N/A
Net Bank Debt + Bonds / EBITDA 4.0X 6.0X
Total Net Debt / EBITDA 5.7X 7.5X
Last Quarter Annualized
Adjusted EBITDA 287,836 $343,184
* Excludes Restricted Cash of $80.7 million
Contacts: W. Benjamin Moreland, CFO
Jay Brown, Treasurer
Crown Castle International Corp.
713-570-3000
SOURCE Crown Castle International Corp.
-0- 10/26/2005
/CONTACT: W. Benjamin Moreland, CFO, or Jay Brown, Treasurer, both of
Crown Castle International Corp., +1-713-570-3000/
/Web site: http://www.crowncastle.com /
(CCI)
CO: Crown Castle International Corp.
ST: Texas
IN: CPR TLS
SU: ERN CCA ERP
AH-JP
-- DAW041 --
6221 10/26/2005 16:01 EDT http://www.prnewswire.com