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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________

FORM 10-Q
___________________________________
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2020
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period              to             
Commission File Number 001-16441
____________________________________
https://cdn.kscope.io/2be134da722a308aef4b7ca0fa7306e8-crownlogo19.jpg
CROWN CASTLE INTERNATIONAL CORP.
(Exact name of registrant as specified in its charter)
 
Delaware
76-0470458
(State or other jurisdiction
of incorporation or organization)
(I.R.S. Employer
Identification No.)
 
 
 
 
1220 Augusta Drive, Suite 600, Houston, Texas 77057-2261
(Address of principal executives office) (Zip Code)
(713) 570-3000
(Registrant's telephone number, including area code)
____________________________________
 Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.01 par value
CCI
New York Stock Exchange
6.875% Mandatory Convertible Preferred Stock, Series A, $0.01 par value
CCI.PRA
New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.
 
Large accelerated filer
 
Accelerated filer
 
 
Non-accelerated filer
 
Smaller reporting company
 
 
 
 
 
Emerging growth company
 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  
Number of shares of common stock outstanding at April 29, 2020: 416,751,230
 



CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

INDEX
 
 
 
Page
 
ITEM 1.
 
 
 
 
 
 
 
 
 
 
 
ITEM 2.
 
ITEM 3.
 
ITEM 4.
 
 
ITEM 1.
LEGAL PROCEEDINGS
 
ITEM 1A.
 
ITEM 2.
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
 
ITEM 6.
 
EXHIBIT INDEX
 
SIGNATURES
 
Cautionary Language Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q ("Form 10-Q") contains forward-looking statements that are based on our management's expectations as of the filing date of this report with the Securities and Exchange Commission ("SEC"). Statements that are not historical facts are hereby identified as forward-looking statements. In addition, words such as "estimate," "anticipate," "project," "plan," "intend," "believe," "expect," "likely," "predicted," "positioned," "continue," "target," and any variations of these words and similar expressions are intended to identify forward-looking statements. Such statements include plans, projections and estimates contained in "Part I—Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations" ("MD&A"), "Part I—Item 3. Quantitative and Qualitative Disclosures About Market Risk," "Part I—Item 4. Controls and Procedures" and "Part II—Item 1A. Risk Factors" herein. Such forward-looking statements include (1) benefits and opportunities stemming from our strategy, strategic position, business model and capabilities, (2) the strength and growth potential of the U.S. market for shared communications infrastructure investment, (3) expectations regarding anticipated growth in the wireless industry, and consumption of and demand for data, including growth in, and factors driving, consumption and demand, (4) potential benefits of our communications infrastructure (on an individual and collective basis) and expectations regarding demand therefore, including potential benefits and continuity of and factors driving such demand, (5) expectations regarding construction, including duration of our construction projects, and acquisition of communications infrastructure, (6) the utilization of our net operating loss carryforwards ("NOLs"), (7) expectations regarding wireless carriers' focus on improving network quality and expanding capacity, (8) expectations regarding continued adoption and increase in usage of high-bandwidth applications by organizations, (9) expected use of net proceeds from issuances under the commercial paper program ("CP Program"), (10) assumed conversion of 6.875% Mandatory Preferred Stock and the impact therefrom and dividends expected to be paid thereon, (11) our full year 2020 outlook and the anticipated growth in our financial results, including future revenues and operating cash flows, and the expectations regarding our 2020 capital expenditures, as well as the factors impacting expected growth in financial results and the levels of capital expenditures, (12) expectations regarding our capital structure and the credit markets, our availability and cost of capital, capital allocation, our leverage ratio and interest coverage targets, our ability to service our debt and comply with debt covenants and the plans for and the benefits of any future refinancings, (13) the utility of certain financial measures, including non-GAAP financial measures, (14) expectations related to our ability to remain qualified as a real estate investment trust ("REIT") and the advantages, benefits or impact of, or opportunities created by, our REIT status, (15) adequacy, projected sources and uses of liquidity, (16) impact of the completed merger between T-Mobile and Sprint, (17) expectations regarding non-renewals of tenant contracts, (18) our dividend policy and the timing, amount, growth or tax characterization of any dividends, (19) the potential impact of novel coronavirus (COVID-19) pandemic, (20) expectations regarding our remediation efforts related to a material

1


weakness in our internal control over financial reporting and (21) the outcome of the shareholder litigation. All future dividends are subject to declaration by our board of directors.
Such forward-looking statements should, therefore, be considered in light of various risks, uncertainties and assumptions, including prevailing market conditions, risk factors described in "Part II—Item 1A. Risk Factors" herein and "Item 1A. Risk Factors" of the Annual Report on Form 10-K for the fiscal year ended December 31, 2019 ("2019 Form 10-K") and other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected.

Our filings with the SEC are available through the SEC website at www.sec.gov or through our investor relations website at investor.crowncastle.com. We use our investor relations website to disclose information about us that may be deemed to be material. We encourage investors, the media and others interested in us to visit our investor relations website from time to time to review up-to-date information or to sign up for e-mail alerts to be notified when new or updated information is posted on the site.
Interpretation
As used herein, the term "including," and any variation thereof, means "including without limitation." The use of the word "or" herein is not exclusive. Unless this Form 10-Q indicates otherwise or the context otherwise requires, the terms "we," "our," "our company," "the company" or "us" as used in this Form 10-Q refer to Crown Castle International Corp. ("CCIC") and its predecessor (organized in 1995), as applicable, each a Delaware corporation, and their subsidiaries. Additionally, unless the context suggests otherwise, references to "U.S." are to the United States of America and Puerto Rico, collectively. Capitalized terms used but not defined in this Form 10-Q have the same meaning given to them in the 2019 Form 10-K.

Explanatory Note
As previously disclosed in the Explanatory Note of the 2019 Form 10-K, we restated our audited consolidated financial statements for the years ended December 31, 2018 and 2017, and quarterly unaudited financial information for the quarterly and year-to-date periods in the year ended December 31, 2018 and first three quarters for the year ended December 31, 2019. Accordingly, the condensed consolidated financial statements as of and for the quarterly period ended March 31, 2019 included in this Quarterly Report on Form 10-Q have been restated to reflect the Historical Adjustments as described in the 2019 Form 10-K. See also note 2 to our condensed consolidated financial statements for further information on the impact of the Historical Adjustments on the condensed consolidated financial statements as of and for the quarterly period ended March 31, 2019.


2


PART I—FINANCIAL INFORMATION
ITEM 1.
FINANCIAL STATEMENTS

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
(Amounts in millions, except par values)
 
March 31,
2020
 
December 31,
2019
ASSETS
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
310

 
$
196

Restricted cash
157

 
137

Receivables, net
495

 
596

Prepaid expenses

107

 
107

Other current assets
178

 
168

Total current assets
1,247

 
1,204

Deferred site rental receivables
1,428

 
1,424

Property and equipment, net of accumulated depreciation of $9,953 and $9,668, respectively
14,815

 
14,666

Operating lease right-of-use assets
6,198

 
6,133

Goodwill
10,078

 
10,078

Other intangible assets, net

4,734

 
4,836

Other assets, net

116

 
116

Total assets
$
38,616

 
$
38,457

 
 
 
 
LIABILITIES AND EQUITY
 
 
 
Current liabilities:
 
 
 
Accounts payable
$
296

 
$
334

Accrued interest
119

 
169

Deferred revenues
741

 
657

Other accrued liabilities

264

 
361

Current maturities of debt and other obligations
949

 
100

Current portion of operating lease liabilities
300

 
299

Total current liabilities
2,669

 
1,920

Debt and other long-term obligations
17,746

 
18,021

Operating lease liabilities
5,567

 
5,511

Other long-term liabilities

2,513

 
2,516

Total liabilities
28,495

 
27,968

Commitments and contingencies (note 9)
 
 
 
CCIC stockholders' equity:
 
 
 
Common stock, $0.01 par value; 600 shares authorized; shares issued and outstanding: March 31, 2020—417 and December 31, 2019—416
4

 
4

6.875% Mandatory Convertible Preferred Stock, Series A, $0.01 par value; 20 shares authorized; shares issued and outstanding: March 31, 2020—2 and December 31, 2019—2; aggregate liquidation value: March 31, 2020—$1,650 and December 31, 2019—$1,650

 

Additional paid-in capital
17,835

 
17,855

Accumulated other comprehensive income (loss)
(6
)
 
(5
)
Dividends/distributions in excess of earnings
(7,712
)
 
(7,365
)
Total equity
10,121

 
10,489

Total liabilities and equity
$
38,616

 
$
38,457



See notes to condensed consolidated financial statements.

3


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS) (Unaudited)
(Amounts in millions, except per share amounts)

 
Three Months Ended March 31,
 
2020
 
2019
 
 
 
(As Restated)
Net revenues:
 
 
 
Site rental
$
1,310

 
$
1,242

Services and other
111

 
166

Net revenues
1,421

 
1,408

Operating expenses:
 
 
 
Costs of operations(a):
 
 
 
Site rental
375

 
361

Services and other
99

 
124

Selling, general and administrative
175

 
152

Asset write-down charges
4

 
6

Acquisition and integration costs
5

 
4

Depreciation, amortization and accretion
399

 
394

Total operating expenses
1,057

 
1,041

Operating income (loss)
364

 
367

Interest expense and amortization of deferred financing costs
(175
)
 
(168
)
Gains (losses) on retirement of long-term obligations

 
(1
)
Interest income
1

 
2

Other income (expense)

 
(1
)
Income (loss) before income taxes
190

 
199

Benefit (provision) for income taxes
(5
)
 
(6
)
Net income (loss) attributable to CCIC stockholders
185

 
193

Dividends/distributions on preferred stock
(28
)
 
(28
)
Net income (loss) attributable to CCIC common stockholders
$
157

 
$
165

Net income (loss)
$
185

 
$
193

Other comprehensive income (loss):
 
 
 
Foreign currency translation adjustments
(1
)
 

Total other comprehensive income (loss)
(1
)
 

Comprehensive income (loss) attributable to CCIC stockholders
$
184

 
$
193

Net income (loss) attributable to CCIC common stockholders, per common share:
 
 
 
Net income (loss) attributable to CCIC common stockholders—basic
$
0.38

 
$
0.40

Net income (loss) attributable to CCIC common stockholders—diluted
$
0.38

 
$
0.40

Weighted-average common shares outstanding:
 
 
 
Basic
416
 
415

Diluted
418
 
417

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

See notes to condensed consolidated financial statements.

4


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
(In millions of dollars)

 
Three Months Ended March 31,
 
2020
 
2019
 
 
 
(As Restated)
Cash flows from operating activities:
 
 
 
Net income (loss)
$
185

 
$
193

Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:
 
 
 
Depreciation, amortization and accretion
399

 
394

(Gains) losses on retirement of long-term obligations

 
1

Amortization of deferred financing costs and other non-cash interest
1

 
1

Stock-based compensation expense
37

 
29

Asset write-down charges
4

 
6

Deferred income tax (benefit) provision
1

 
1

Other non-cash adjustments, net

 
2

Changes in assets and liabilities, excluding the effects of acquisitions:
 
 
 
Increase (decrease) in accrued interest
(50
)
 
(41
)
Increase (decrease) in accounts payable
(20
)
 
(5
)
Increase (decrease) in other liabilities
2

 
(7
)
Decrease (increase) in receivables
102

 
(43
)
Decrease (increase) in other assets
(8
)
 
(19
)
Net cash provided by (used for) operating activities
653

 
512

Cash flows from investing activities:
 
 
 
Capital expenditures
(447
)
 
(480
)
Payments for acquisitions, net of cash acquired
(13
)
 
(10
)
Other investing activities, net
(8
)
 
1

Net cash provided by (used for) investing activities
(468
)
 
(489
)
Cash flows from financing activities:
 
 
 
Proceeds from issuance of long-term debt

 
996

Principal payments on debt and other long-term obligations
(26
)
 
(25
)
Purchases and redemptions of long-term debt

 
(12
)
Borrowings under revolving credit facility
1,340

 
710

Payments under revolving credit facility
(595
)
 
(1,140
)
Net issuances (repayments) under commercial paper program
(155
)
 

Payments for financing costs

 
(10
)
Purchases of common stock
(73
)
 
(42
)
Dividends/distributions paid on common stock
(513
)
 
(477
)
Dividends/distributions paid on preferred stock
(28
)
 
(28
)
Net cash provided by (used for) financing activities
(50
)
 
(28
)
Net increase (decrease) in cash, cash equivalents, and restricted cash
135

 
(5
)
Effect of exchange rate changes
(1
)
 

Cash, cash equivalents, and restricted cash at beginning of period
338

 
413

Cash, cash equivalents, and restricted cash at end of period
$
472

 
$
408




See notes to condensed consolidated financial statements.

5


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF EQUITY
(Amounts in millions) (Unaudited)

 
Common Stock
 
6.875% Mandatory Convertible Preferred Stock
 
 
 
Accumulated Other Comprehensive Income (Loss) ("AOCI")
 
 
 
 
 
Shares
 
($0.01 Par)
 
Shares
 
($0.01 Par)
 
Additional
paid-in
capital
 
Foreign Currency Translation Adjustments
 
Dividends/Distributions in Excess of Earnings
 
Total
Balance, December 31, 2019
416

 
$
4

 
2

 
$

 
$
17,855

 
$
(5
)
 
$
(7,365
)
 
$
10,489

Stock-based compensation related activity, net of forfeitures
1

 

 

 

 
53

 

 

 
53

Purchases and retirement of common stock

 

 

 

 
(73
)
 

 

 
(73
)
Other comprehensive income (loss)(a)

 

 

 

 

 
(1
)
 

 
(1
)
Common stock dividends/distributions(b)

 

 

 

 

 

 
(504
)
 
(504
)
Preferred stock dividends/distributions(b)

 

 

 

 

 

 
(28
)
 
(28
)
Net income (loss)

 

 

 

 

 

 
185

 
185

Balance, March 31, 2020
417

 
$
4

 
2

 
$

 
$
17,835

 
$
(6
)
 
$
(7,712
)
 
$
10,121




 
Common Stock
 
6.875% Mandatory Convertible Preferred Stock
 
 
 
AOCI
 
 
 
 
 
Shares
 
($0.01 Par)
 
Shares
 
($0.01 Par)
 
Additional
paid-in
capital
 
Foreign Currency Translation Adjustments
 
Dividends/Distributions in Excess of Earnings
 
Total
Balance, December 31, 2018 (As Restated)
415

 
$
4

 
2

 
$

 
$
17,767

 
$
(5
)
 
$
(6,195
)
 
$
11,571

Stock-based compensation related activity, net of forfeitures
1

 

 

 

 
45

 

 

 
45

Purchases and retirement of common stock

 

 

 

 
(42
)
 

 

 
(42
)
Net proceeds from issuance of common stock

 

 

 

 

 

 

 

Common stock dividends/distributions(b)

 

 

 

 

 

 
(472
)
 
(472
)
Preferred stock dividends/distributions(b)

 

 

 

 

 

 
(28
)
 
(28
)
Net income (loss) (As Restated)

 

 

 

 

 

 
193

 
193

Balance, March 31, 2019 (As Restated)
416

 
$
4

 
2

 
$

 
$
17,770

 
$
(5
)
 
$
(6,502
)
 
$
11,267

    
(a)
See the condensed consolidated statement of operations and other comprehensive income (loss) for the components of other comprehensive income (loss).
(b)
See note 8 for information regarding common and preferred stock dividends declared per share.





6


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited
(Tabular dollars in millions, except per share amounts)


1.
General
The information contained in the following notes to the condensed consolidated financial statements is condensed from that which would appear in the annual consolidated financial statements; accordingly, the condensed consolidated financial statements included herein should be reviewed in conjunction with the consolidated financial statements for the fiscal year ended December 31, 2019, and related notes thereto, included in the 2019 Form 10-K filed by Crown Castle International Corp. ("CCIC") with the SEC. Capitalized terms used but not defined in these notes to the condensed consolidated financial statements have the same meaning given to them in the 2019 Form 10-K. References to the "Company" refer to CCIC and its predecessor, as applicable, and their subsidiaries, unless otherwise indicated or the context indicates otherwise. As used herein, the term "including," and any variation thereof means "including without limitation." The use of the word "or" herein is not exclusive. Unless the context suggests otherwise, references to "U.S." are to the United States of America and Puerto Rico, collectively.
The Company owns, operates and leases shared communications infrastructure that is geographically dispersed throughout the U.S., including (1) towers and other structures, such as rooftops (collectively, "towers"), and (2) fiber primarily supporting small cell networks ("small cells") and fiber solutions. The Company's towers, fiber and small cells assets are collectively referred to herein as "communications infrastructure," and the Company's customers on its communications infrastructure are referred to herein as "tenants."
The Company's core business is providing access, including space or capacity, to its shared communications infrastructure via long-term contracts in various forms, including lease, license, sublease and service agreements (collectively, " tenant contracts").
The Company's operating segments consist of (1) Towers and (2) Fiber. See note 11.
As part of the Company's effort to provide comprehensive communications infrastructure solutions, as an ancillary business, the Company also offers certain services primarily relating to its Towers segment, predominately consisting of (1) site development services primarily relating to existing or new tenant equipment installations, including: site acquisition, architectural and engineering, or zoning and permitting (collectively, "site development services") and (2) tenant equipment installation or subsequent augmentations (collectively, "installation services").
The Company operates as a REIT for U.S. federal income tax purposes. In addition, the Company has certain taxable REIT subsidiaries ("TRSs"). See note 7.
Approximately 53% of the Company's towers are leased or subleased or operated and managed under master leases, subleases, and other agreements with AT&T, Sprint and T-Mobile. The Company has the option to purchase these towers at the end of their respective lease terms. The Company has no obligation to exercise such purchase options.
Basis of Presentation
The condensed consolidated financial statements included herein are unaudited; however, they include all adjustments (consisting only of normal recurring adjustments) which, in the opinion of management, are necessary to state fairly the consolidated financial position of the Company at March 31, 2020, the condensed consolidated results of operations for the three months ended March 31, 2020 and 2019, and the condensed consolidated cash flows for the three months ended March 31, 2020 and 2019. The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the full year.
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.


7


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in millions, except per share amounts)

2.
Restatement of Previously Issued Condensed Consolidated Financial Statements
The following tables summarize the impact of the restatement adjustments that were related to the timing of revenue recognition on its tower installation services. Specifically, the Company determined that its historical practice of recognizing the full transaction price as service revenues upon completion of an installation was not acceptable under GAAP. Instead, a portion of the transaction price for the Company's tower installation services, specifically the amounts associated with permanent improvements recorded as fixed assets, represent a lease component and should be recognized as site rental revenues on a ratable basis over the associated estimated lease term. In addition, the Company has also made other adjustments to the financial statements referenced above to correct errors that were not material to its condensed consolidated financial statements. Such immaterial adjustments are related to a revision in the presentation of certain tower installation activities from a gross basis to a net basis, including the associated removal of certain amounts historically categorized as capital expenditures.  These immaterial adjustments relate exclusively to the Company's Towers segment. Collectively, the restatement adjustments and other immaterial adjustments are referred to herein as "Historical Adjustments."
In addition to the restatement of the condensed consolidated financial statements, certain historical information in the notes to the condensed consolidated financial statements have been restated to reflect the impact of the Historical Adjustments.
Condensed Consolidated Balance Sheet
 
March 31, 2019
 
As Reported
 
Restatement Adjustments
 
Other Adjustments
 
As Restated
ASSETS
 
 
 
 
 
 
 
Property and equipment, net
$
13,883

 
$

 
$
(23
)
 
$
13,860

Total assets
37,778

 

 
(23
)
 
37,755

LIABILITIES AND EQUITY
 
 
 
 
 
 


Current liabilities:
 
 
 
 
 
 


Deferred revenues
502

 
96

 

 
598

Total current liabilities
1,565

 
96

 

 
1,661

Other long-term liabilities
2,009

 
360

 

 
2,369

Total liabilities
26,032

 
456

 

 
26,488

CCIC stockholders' equity:
 
 
 
 
 
 


Dividends/distributions in excess of earnings
(6,022
)
 
(456
)
 
(23
)
 
(6,501
)
Total equity
11,746

 
(456
)
 
(23
)
 
11,267

Total liabilities and equity
$
37,778

 
$

 
$
(23
)
 
$
37,755




8


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in millions, except per share amounts)

Condensed Consolidated Statement of Operations and Comprehensive Income (Loss)
 
Three Months Ended March 31, 2019
 
As Reported
 
Restatement Adjustments
 
Other Adjustments
 
As Restated
Net revenues:
 
 
 
 
 
 
 
Site rental
$
1,219

 
$
23

 
$

 
$
1,242

Services and other
207

 
(40
)
 
(1
)
 
166

Net revenues
1,426

 
(17
)
 
(1
)
 
1,408

Operating expenses:
 
 
 
 
 
 


Costs of operations(a):
 
 
 
 
 
 


Services and other
125

 

 
(1
)
 
124

Total operating expenses
1,042

 

 
(1
)
 
1,041

Operating income (loss)
384

 
(17
)
 

 
367

Income (loss) before income taxes
216

 
(17
)
 

 
199

Net income (loss) attributable to CCIC stockholders
210

 
(17
)
 

 
193

Net income (loss) attributable to CCIC common stockholders
$
182

 
$
(17
)
 
$

 
$
165

Net income (loss)
$
210

 
$
(17
)
 
$

 
$
193

Comprehensive income (loss) attributable to CCIC stockholders
$
210

 
$
(17
)
 
$

 
$
193

Net income (loss) attributable to CCIC common stockholders, per common share:
 
 
 
 
 
 
 
Net income (loss) attributable to CCIC common stockholders - basic
$
0.44

 
$
(0.04
)
 
$

 
$
0.40

Net income (loss) attributable to CCIC common stockholders - diluted
$
0.44

 
$
(0.04
)
 
$

 
$
0.40

    
(a)
Exclusive of depreciation, amortization and accretion shown separately.
Condensed Consolidated Statement of Cash Flows
 
Three Months Ended March 31, 2019
 
As Reported
 
Restatement Adjustments
 
Other Adjustments
 
As Restated
Cash flows from operating activities:
 
 
 
 
 
 
 
Net income (loss)
$
210

 
$
(17
)
 
$

 
$
193

Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:
 
 
 
 
 
 


Increase (decrease) in other liabilities
(24
)
 
17

 

 
(7
)
Net cash provided by (used for) operating activities
512

 

 

 
512

Net increase (decrease) in cash, cash equivalents, and restricted cash
(5
)
 

 

 
(5
)
Cash, cash equivalents, and restricted cash at beginning of period
413

 

 

 
413

Cash, cash equivalents, and restricted cash at end of period
$
408

 
$

 
$

 
$
408




9


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in millions, except per share amounts)

3.
Summary of Significant Accounting Policies
Recently Adopted Accounting Pronouncements
No accounting pronouncements adopted during the three months ended March 31, 2020 had a material impact on the Company's condensed consolidated financial statements.
Recent Accounting Pronouncements Not Yet Adopted
No new accounting pronouncements issued but not yet adopted are expected to have a material impact on the Company's condensed consolidated financial statements.

4.
Revenues
Site rental revenues
The Company generates site rental revenues from its core business by providing tenants with access, including space or capacity, to its shared communications infrastructure via long-term tenant contracts in various forms, including lease, license, sublease and service agreements. Providing such access over the length of the tenant contract term represents the Company’s sole performance obligation under its tenant contracts.
Site rental revenues from the Company's tenant contracts are recognized on a straight-line, ratable basis over the fixed, non-cancelable term of the relevant tenant contract, which generally ranges from five to 15 years for wireless tenants and three to 20 years for the Company's fiber solutions tenants (including from organizations with high-bandwidth and multi-location demands), regardless of whether the payments from the tenant are received in equal monthly amounts during the life of the tenant contract. Certain of the Company's tenant contracts contain (1) fixed escalation clauses (such as fixed dollar or fixed percentage increases) or inflation-based escalation clauses (such as those tied to the CPI), (2) multiple renewal periods exercisable at the tenant's option and (3) only limited termination rights at the applicable tenant's option through the current term. If the payment terms call for fixed escalations, upfront payments, or rent-free periods, the revenue is recognized on a straight-line basis over the fixed, non-cancelable term of the agreement. When calculating straight-line rental revenues, the Company considers all fixed elements of tenant contractual escalation provisions, even if such escalation provisions contain a variable element in addition to a minimum. The Company's assets related to straight-line site rental revenues include current amounts of $123 million included in "Other current assets" and non-current amounts of $1.4 billion included in "Deferred site rental receivables" as of March 31, 2020. Amounts billed or received prior to being earned are deferred and reflected in "Deferred revenues" and "Other long-term liabilities." Amounts to which the Company has an unconditional right to payment, which are related to both satisfied or partially satisfied performance obligations, are recorded within "Receivables, net" on the Company's condensed consolidated balance sheet.
Services and other revenues
As part of the Company’s effort to provide comprehensive communications infrastructure solutions, as an ancillary business, the Company offers certain services primarily relating to its Towers segment, predominately consisting of (1) site development services and (2) installation services. Upon contract commencement, the Company assesses its services to tenants and identifies performance obligations for each promise to provide a distinct service.
The Company may have multiple performance obligations for site development services, which primarily include: structural analysis, zoning, permitting and construction drawings. For each of the above performance obligations, services revenues are recognized at completion of the applicable performance obligation, which represents the point at which the Company believes it has transferred goods or services to the tenant. The revenue recognized is based on an allocation of the transaction price among the performance obligations in a respective contract based on estimated standalone selling price. The volume and mix of site development services may vary among contracts and may include a combination of some or all of the above performance obligations. Payments generally are due within 45 to 60 days and generally do not contain variable-consideration provisions. The transaction price for the Company's tower installation services consists of amounts for (1) permanent improvements to the Company's towers that represent a lease component and (2) the performance of the service. Amounts under the Company's tower installation service agreements that represent a lease component are recognized as site rental revenues on a straight-line basis over the length of the associated estimated lease term. For the performance of the installation service, the Company has one performance obligation, which is satisfied at the time of the applicable installation or augmentation and recognized as services and other revenues. Since performance obligations are typically satisfied prior to receiving payment from tenants, the unconditional right to payment is

10


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in millions, except per share amounts)

recorded within "Receivables, net" on the Company’s condensed consolidated balance sheet. The vast majority of the Company’s services generally have a duration of one year or less.
Additional information on revenues
The following additional information on revenues reflect the impact of the Historical Adjustments, where applicable, as discussed in note 2. As of January 1, 2020 and March 31, 2020, $2.9 billion and $2.8 billion, respectively, of unrecognized revenue was reported in "Deferred revenues" and "Other long-term liabilities" on our condensed consolidated balance sheet. During the three months ended March 31, 2020, approximately $160 million of the January 1, 2020 unrecognized revenue balance was recognized as revenue. During the three months ended March 31, 2019, approximately $135 million of the January 1, 2019 unrecognized revenue balance was recognized as revenue.
The following table is a summary of the non-cancelable contracted amounts owed to the Company by tenants pursuant to tenant contracts in effect as of March 31, 2020.
 
 
Nine Months Ending December 31,
 
Years Ending December 31,
 
 
 
 
 
 
2020
 
2021
 
2022
 
2023
 
2024
 
Thereafter
 
Total
Contracted amounts(a)
 
$
3,257

 
$
4,071

 
$
3,842

 
$
3,213

 
$
2,489

 
$
7,219

 
$
24,091


    
(a)
Based on the nature of the contract, tenant contracts are accounted for pursuant to relevant lease accounting (ASC 842) or revenue accounting (ASC 606) guidance. Excludes amounts related to services, as those contracts generally have a duration of one year or less.
See note 11 for further information regarding the Company's operating segments.


11


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in millions, except per share amounts)

5.
Debt and Other Obligations
See note 13 for a discussion of the Company's issuance of the April 2020 Senior Notes (as defined in note 13) and the application of the net proceeds therefrom.
The table below sets forth the Company's debt and other obligations as of March 31, 2020.
 
Original
Issue Date
 
Final
Maturity
Date(a)
 
Balance as of
March 31, 2020
 
Balance as of
December 31, 2019
 
Stated Interest
Rate as of
March 31, 2020(a)
 
3.849% Secured Notes
Dec. 2012
 
Apr. 2023
 
$
996

 
$
995

 
3.9
%
 
Secured Notes, Series 2009-1, Class A-2
July 2009
 
Aug. 2029
 
66

 
67

 
9.0
%
 
Tower Revenue Notes, Series 2015-1
May 2015
 
May 2042
(b) 
299

 
298

 
3.2
%
 
Tower Revenue Notes, Series 2018-1
July 2018
 
July 2043
(b) 
248

 
248

 
3.7
%
 
Tower Revenue Notes, Series 2015-2
May 2015
 
May 2045
(b) 
695

 
694

 
3.7
%
 
Tower Revenue Notes, Series 2018-2
July 2018
 
July 2048
(b) 
742

 
742

 
4.2
%
 
Finance leases and other obligations
Various
 
Various
(c) 
221

 
227

 
Various
 
Total secured debt
 
 
 
 
$
3,267

 
$
3,271

 
 
 
2016 Revolver
Jan. 2016
 
June 2024
 
$
1,270

(d) 
$
525

 
2.1
%
(e) 
2016 Term Loan A
Jan. 2016
 
June 2024
 
2,295

 
2,310

 
2.1
%
(e) 
Commercial Paper Notes
N/A
(f) 
N/A
(f) 

(f) 
155

 
N/A
 
3.400% Senior Notes
Feb./May 2016
 
Feb. 2021
 
850

 
850

 
3.4
%
 
2.250% Senior Notes
Sept. 2016
 
Sept. 2021
 
698

 
698

 
2.3
%
 
4.875% Senior Notes
Apr. 2014
 
Apr. 2022
 
846

 
846

 
4.9
%
 
5.250% Senior Notes
Oct. 2012
 
Jan. 2023
 
1,644

 
1,644

 
5.3
%
 
3.150% Senior Notes
Jan. 2018
 
July 2023
 
744

 
744

 
3.2
%
 
3.200% Senior Notes
Aug. 2017
 
Sept. 2024
 
745

 
744

 
3.2
%
 
4.450% Senior Notes
Feb. 2016
 
Feb. 2026
 
893

 
893

 
4.5
%
 
3.700% Senior Notes
May 2016
 
June 2026
 
745

 
744

 
3.7
%
 
4.000% Senior Notes
Feb. 2017
 
Mar. 2027
 
495

 
495

 
4.0
%
 
3.650% Senior Notes
Aug. 2017
 
Sept. 2027
 
993

 
993

 
3.7
%
 
3.800% Senior Notes
Jan. 2018
 
Feb. 2028
 
990

 
990

 
3.8
%
 
4.300% Senior Notes
Feb. 2019
 
Feb. 2029
 
592

 
592

 
4.3
%
 
3.100% Senior Notes
Aug. 2019
 
Nov. 2029
 
544

 
543

 
3.1
%
 
4.750% Senior Notes
May 2017
 
May 2047
 
344

 
344

 
4.8
%
 
5.200% Senior Notes
Feb. 2019
 
Feb. 2049
 
395

 
395

 
5.2
%
 
4.000% Senior Notes
Aug. 2019
 
Nov. 2049
 
345

 
345

 
4.0
%
 
Total unsecured debt
 
 
 
 
$
15,428

 
$
14,850

 
 
 
Total debt and other obligations
 
 
 
 
18,695

 
18,121

 
 
 
Less: current maturities and short-term debt and other current obligations
 
949

 
100

 
 
 
Non-current portion of long-term debt and other long-term obligations
 
$
17,746

 
$
18,021

 
 
 
    
(a)
See the 2019 Form 10-K, including note 9, for additional information regarding the maturity and principal amortization provisions and interest rates relating to the Company's indebtedness.
(b)
If the respective series of Tower Revenue Notes are not paid in full on or prior to an applicable anticipated repayment date, 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 Tower Revenue Notes, and additional interest (of an additional approximately 5% per annum) will accrue on the respective Tower Revenue Notes. As of March 31, 2020, the Tower Revenue Notes have principal amounts of $300 million, $250 million, $700 million and $750 million, with anticipated repayment dates in 2022, 2023, 2025 and 2028, respectively.
(c)
The Company's finance leases and other obligations relate to land, fiber, vehicles, and other assets and bear interest rates ranging up to 10% and mature in periods ranging from less than one year to approximately 30 years.
(d)
As of March 31, 2020, the undrawn availability under the 2016 Revolver was $3.7 billion.
(e)
Both the 2016 Revolver and 2016 Term Loan A bear interest, at our option, at either (1) LIBOR plus a credit spread ranging from 0.875% to 1.750% per annum or (2) an alternate base rate plus a credit spread ranging from 0.000% to 0.750% per annum, in each case, with the applicable credit spread based on the Company's senior unsecured debt rating. The Company pays a commitment fee ranging from 0.125% to 0.350%, based on the Company's senior unsecured debt rating, per annum on the undrawn available amount under the 2016 Revolver.

12


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in millions, except per share amounts)

(f)
Notes under the CP Program may be issued, repaid and re-issued from time to time, with an aggregate principal amount of Commercial Paper Notes outstanding under the CP Program at any time not to exceed $1.0 billion. The net proceeds of the Commercial Paper Notes are expected to be used for general corporate purposes. The maturities of the 2019 Commercial Paper Notes, when outstanding, may vary but may not exceed 397 days from the date of issue. The Commercial Paper Notes are issued under customary terms in the commercial paper market and are issued at a discount from par or, alternatively, can be issued at par and bear varying interest rates on a fixed or floating basis. As of March 31, 2020, there were no outstanding Commercial Paper Notes. At any point in time, the Company intends to maintain available commitments under its 2016 Revolver in an amount at least equal to the amount of Commercial Paper Notes outstanding. While any outstanding commercial paper issuances generally have short-term maturities, the Company classifies the outstanding issuances, when applicable, as long-term based on its ability and intent to refinance the outstanding issuances on a long-term basis.
The following are the scheduled principal payments and final maturities of the total debt and other long-term obligations of the Company outstanding as of March 31, 2020, which do not consider the principal payments that will commence following the anticipated repayment dates on the Tower Revenue Notes.
 
Nine Months Ending
December 31,
 
Years Ending December 31,
 
 
 
 
 
Unamortized Adjustments, Net
 
Total Debt and Other Obligations Outstanding
 
2020
 
2021
 
2022
 
2023
 
2024
 
Thereafter
 
Total Cash Obligations
 
 
Scheduled principal payments and
final maturities
$
76

 
$
1,675

 
$
1,000

 
$
3,604

 
$
3,917

 
$
8,532

 
$
18,804

 
$
(109
)
 
$
18,695


Interest Expense and Amortization of Deferred Financing Costs
The components of interest expense and amortization of deferred financing costs are as follows:
 
Three Months Ended March 31,
 
2020
 
2019
Interest expense on debt obligations
$
174

 
$
167

Amortization of deferred financing costs and adjustments on long-term debt
5

 
5

Other, net of capitalized interest
(4
)
 
(4
)
Total
$
175

 
$
168



6.
Fair Value Disclosures
 
Level in Fair Value Hierarchy
 
March 31, 2020
 
December 31, 2019
 
 
Carrying
 Amount
 
Fair
Value
 
Carrying
 Amount
 
Fair
Value
Assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
1
 
$
310

 
$
310

 
$
196

 
$
196

Restricted cash, current and non-current
1
 
162

 
162

 
142

 
142

Liabilities:
 
 
 
 
 
 
 
 
 
Total debt and other obligations
2
 
18,695

 
19,175

 
18,121

 
19,170


The fair value of cash and cash equivalents and restricted cash approximate the carrying value. The Company determines the fair value of its debt securities based on indicative, non-binding quotes from brokers. Quotes from brokers require judgment and are based on the brokers' interpretation of market information, including implied credit spreads for similar borrowings on recent trades or bid/ask prices or quotes from active markets if available. Since December 31, 2019, there have been no changes in the Company's valuation techniques used to measure fair values.


13


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in millions, except per share amounts)

7.
Income Taxes
The Company operates as a REIT for U.S. federal income tax purposes. As a REIT, the Company is generally entitled to a deduction for dividends that it pays and therefore is not subject to U.S. federal corporate income tax on its net taxable income that is currently distributed to its stockholders. The Company also may be subject to certain federal, state, local and foreign taxes on its income and assets, including (1) taxes on any undistributed income, (2) taxes related to the TRSs, (3) franchise taxes, (4) property taxes, and (5) transfer taxes. In addition, the Company could in certain circumstances be required to pay an excise or penalty tax, which could be significant in amount, in order to utilize one or more relief provisions under the Internal Revenue Code of 1986, as amended, to maintain qualification for taxation as a REIT.
The Company's TRS assets and operations will continue to be subject, as applicable, to federal and state corporate income taxes or to foreign taxes in the jurisdictions in which such assets and operations are located. The Company's foreign assets and operations (including its tower operations in Puerto Rico) are subject to foreign income taxes in the jurisdictions in which such assets and operations are located, regardless of whether they are included in a TRS or not.
For the three months ended March 31, 2020 and 2019, the Company's effective tax rate differed from the federal statutory rate predominately due to the Company's REIT status, including the dividends paid deduction.

8.
Per Share Information
Basic net income (loss) attributable to CCIC common stockholders, per common share, excludes dilution and is computed by dividing net income (loss) attributable to CCIC common stockholders by the weighted-average number of common shares outstanding during the period. For the three months ended March 31, 2020 and 2019, diluted net income (loss) attributable to CCIC common stockholders, per common share, is computed by dividing net income (loss) attributable to CCIC common stockholders by the weighted-average number of common shares outstanding during the period, plus any potential dilutive common share equivalents, including shares issuable upon (1) the vesting of restricted stock units as determined under the treasury stock method and (2) conversion of the Company's 6.875% Mandatory Convertible Preferred Stock, as determined under the if-converted method. The table below also gives effect to the Historical Adjustments, as described in note 2.
 
Three Months Ended March 31,
 
2020
 
2019
 
 
 
(As Restated)
Net income (loss) attributable to CCIC stockholders
$
185

 
$
193

Dividends on preferred stock
(28
)
 
(28
)
Net income (loss) attributable to CCIC common stockholders for basic and diluted computations
$
157

 
$
165

 
 
 
 
Weighted-average number of common shares outstanding (in millions):
 
 
 
Basic weighted-average number of common stock outstanding
416

 
415

Effect of assumed dilution from potential issuance of common shares relating to restricted stock units
2

 
2

Diluted weighted-average number of common shares outstanding
418

 
417

 
 
 
 
Net income (loss) attributable to CCIC common stockholders, per common share:
 
 
 
Basic
$
0.38

 
$
0.40

Diluted
$
0.38

 
$
0.40

 
 
 
 
Dividends/distributions declared per share of common stock
$
1.20

 
$
1.125

Dividends/distributions declared per share of preferred stock
$
17.1875

 
$
17.1875


During the three months ended March 31, 2020, the Company granted one million restricted stock units. For the three months ended March 31, 2020, 15 million common share equivalents related to the 6.875% Mandatory Convertible Preferred Stock were excluded from the dilutive common shares because the impact of such conversion would be anti-dilutive, based on the Company's common stock price as of March 31, 2020.


14


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in millions, except per share amounts)

9.
Commitments and Contingencies
The Company is involved in various claims, lawsuits or proceedings arising in the ordinary course of business. While there are uncertainties inherent in the ultimate outcome of such matters and it is impossible to presently determine the ultimate costs or losses that may be incurred, if any, management believes the resolution of such uncertainties and the incurrence of such costs should not have a material adverse effect on the Company's condensed consolidated financial position or results of operations. Additionally, the Company and certain of its subsidiaries are contingently liable for commitments or performance guarantees arising in the ordinary course of business, including certain letters of credit or surety bonds. In addition, see note 1 for a discussion of the Company's option to purchase approximately 53% of its towers at the end of their respective lease terms. The Company has no obligation to exercise such purchase options.
SEC Investigation
In September 2019, the Company received a subpoena from the SEC requesting certain documents from 2015 through the present, primarily related to the Company's long-standing capitalization and expense policies for tenant upgrades and installations in its services business. Prior to receiving this subpoena, the Company previously provided information to the SEC related to certain services-related transactions. The Company is cooperating fully with the SEC's investigation and cannot predict the ultimate timing, scope or outcome of this matter.
Shareholder Litigation
In February and March 2020, putative securities class action suits were filed in the United States District Court for the District of New Jersey against the Company and certain of its current officers. The lawsuits were filed on behalf of investors that purchased or otherwise acquired stock of the Company between February 26, 2018 and February 26, 2020. The allegations relate to allegedly false or misleading statements or other failures to disclose information about the Company's business, operations and prospects. The complaints seek unspecified money damages and the award of plaintiffs' costs and expenses incurred in the respective class action. The Company is currently unable to determine the likelihood of an outcome or estimate a range of reasonably possible losses, if any, with respect to these lawsuits. The Company believes these lawsuits are without merit and intends to defend itself vigorously.
In April 2020, a stockholder derivative lawsuit was filed by Melvyn Klein in the United States District Court for the District of Delaware, against the Company, as a nominal defendant, and its current directors and certain of its current officers. The complaint alleges, among other things, breaches of fiduciary duties, waste of corporate assets, unjust enrichment, and false or misleading statements, between February 27, 2018 through the present. The complaint seeks, among other things, unspecified money damages, costs and expenses, restitution from the defendants, and an order requiring the Company to implement certain corporate governance reforms. As a nominal defendant, no monetary relief is sought against the Company itself.

10.
Equity
Declaration and Payment of Dividends
During the three months ended March 31, 2020, the following dividends/distributions were declared or paid:
Equity Type
 
Declaration Date
 
Record Date
 
Payment Date
 
Dividends Per Share
 
Aggregate
Payment
Amount
 
Common Stock
 
February 20, 2020
 
March 13, 2020
 
March 31, 2020
 
$
1.20

 
$
504

(a) 
6.875% Mandatory Convertible Preferred Stock
 
December 9, 2019
 
January 15, 2020
 
February 3, 2020
 
$
17.1875

 
$
28

 
6.875% Mandatory Convertible Preferred Stock
 
March 12, 2020
 
April 15, 2020
 
May 1, 2020
 
$
17.1875

 
$
28

 
    
(a)
Inclusive of dividends accrued for holders of unvested restricted stock units, which will be paid when and if the restricted stock units vest.
Purchases of the Company's Common Stock
For the three months ended March 31, 2020, the Company purchased 0.4 million shares of its common stock utilizing $73 million in cash. The shares of common stock purchased relate to shares withheld in connection with the payment of withholding taxes upon vesting of restricted stock units.
2018 "At-the-Market" Stock Offering Program
In April 2018, the Company established an "at-the-market" stock offering program through which it may issue and sell shares of its common stock having an aggregate gross sales price of up to $750 million ("2018 ATM Program"). Sales under the 2018 ATM Program may be made by means of ordinary brokers' transactions on the NYSE or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or, subject to our specific instructions, at negotiated prices. The Company intends to use the net proceeds from any sales under the 2018 ATM Program for general corporate purposes, which may include (1) the funding of future acquisitions or investments or (2) the repayment or repurchase of any outstanding indebtedness. The Company has not sold any shares of common stock under the 2018 ATM Program.

15


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in millions, except per share amounts)


11.
Operating Segments
The Company's operating segments consist of (1) Towers and (2) Fiber. The Towers segment provides access, including space or capacity, to the Company's approximately 40,000 towers geographically dispersed throughout the U.S. The Towers segment also reflects certain ancillary services relating to the Company's towers, predominately consisting of site development services and installation services. The Fiber segment provides access, including space or capacity, to the Company's approximately 80,000 route miles of fiber primarily supporting small cell networks and fiber solutions geographically dispersed throughout the U.S.
The measurements of profit or loss used by the Company's chief operating decision maker ("CODM") to evaluate the performance of its operating segments are (1) segment site rental gross margin, (2) segment services and other gross margin and (3) segment operating profit. The Company defines segment site rental gross margin as segment site rental revenues less segment site rental cost of operations, which excludes stock-based compensation expense and prepaid lease purchase price adjustments recorded in consolidated cost of operations. The Company defines segment services and other gross margin as segment services and other revenues less segment services and other cost of operations, which excludes stock-based compensation expense recorded in consolidated cost of operations. The Company defines segment operating profit as segment site rental gross margin plus segment services and other gross margin, less selling, general and administrative expenses attributable to the respective segment. All of these measurements of profit or loss are exclusive of depreciation, amortization and accretion, which are shown separately.
The following table set forth the Company's segment operating results for the three months ended March 31, 2020 and 2019. Costs that are directly attributable to Towers and Fiber are assigned to those respective segments. Additionally, certain costs are shared across segments and are reflected in the Company's segment measures through allocations that management believes to be reasonable. The "Other" column (1) represents amounts excluded from specific segments, such as asset write-down charges, acquisition and integration costs, depreciation, amortization and accretion, amortization of prepaid lease purchase price adjustments, interest expense and amortization of deferred financing costs, gains (losses) on retirement of long-term obligations, net gain (loss) on interest rate swaps, gains (losses) on foreign currency swaps, interest income, other income (expense), income (loss) from discontinued operations, and stock-based compensation expense, and (2) reconciles segment operating profit to income (loss) before income taxes, as the amounts are not utilized in assessing each segment’s performance. The "Other" total assets balance includes corporate assets such as cash and cash equivalents which have not been allocated to specific segments. There are no significant revenues resulting from transactions between the Company's operating segments.
The table below also gives effect to the Historical Adjustments, as described in note 2. Each of the Historical Adjustments for the three months ended March 31, 2019 are attributable only to the Towers segment.


16


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in millions, except per share amounts)


 
Three Months Ended March 31, 2020
 
Three Months Ended March 31, 2019 (As Restated)
 
Towers
 
Fiber
 
Other
 
Consolidated
Total
 
Towers
 
Fiber
 
Other
 
Consolidated
Total
Segment site rental revenues
$
867

 
$
443

 
 
 
$
1,310

 
$
828

 
$
414

 
 
 
$
1,242

Segment services and other revenues
108

 
3