UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 26, 2022
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | |||||||||||||||||||||
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713 ) 570-3000
| (Former name or former address, if changed since last report.) | ||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||||||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||||||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||||||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | ||||||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
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. ☐
ITEM 2.02 — RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On January 26, 2022, Crown Castle International Corp. ("Company") issued a press release disclosing its financial results for fourth quarter and full year ended December 31, 2021. A copy of the press release is furnished herewith as Exhibit 99.1.
ITEM 7.01 — REGULATION FD DISCLOSURE
The press release referenced in Item 2.02 above refers to certain supplemental information that was posted as a supplemental information package on the Company's website on January 26, 2022. The supplemental information package is furnished herewith as Exhibit 99.2.
ITEM 9.01 — FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits
Exhibit Index
| Exhibit No. | Description | |||||||
| 99.1 | ||||||||
| 99.2 | ||||||||
| 104 | Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document | |||||||
The information in Items 2.02 and 7.01 of this Current Report on Form 8-K ("Form 8-K") and Exhibits 99.1 and 99.2 attached hereto are furnished as part of this Form 8-K and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended ("Exchange Act"), or otherwise subject to the liabilities of that section, nor shall such information or exhibits be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
CROWN CASTLE INTERNATIONAL CORP. | ||||||||||||||
| By: | /s/ Kenneth J. Simon | |||||||||||||
| Name: | Kenneth J. Simon | |||||||||||||
| Title: | Executive Vice President and General Counsel | |||||||||||||
Date: January 26, 2022
Exhibit 99.1
 | NEWS RELEASE January 26, 2022 | |||||||
| Contacts: Dan Schlanger, CFO | |||||
| Ben Lowe, SVP & Treasurer | |||||
| FOR IMMEDIATE RELEASE | Crown Castle International Corp. | ||||
713-570-3050 | |||||
CROWN CASTLE REPORTS FOURTH QUARTER AND FULL YEAR 2021 RESULTS, INCREASES OUTLOOK FOR FULL YEAR 2022
January 26, 2022 - HOUSTON, TEXAS - Crown Castle International Corp. (NYSE: CCI) ("Crown Castle") today reported results for the fourth quarter and full year ended December 31, 2021 and increased its full year 2022 outlook, as reflected in the table below.
| Full Year 2022 | Full Year 2021 | ||||||||||||||||||||||
| (dollars in millions, except per share amounts) | Current Outlook Midpoint(a) | Change to Midpoint from Previous Outlook(b) | Midpoint Growth Rate Compared to Previous Year Actual | Actual | Actual Growth Rate Compared to Previous Year Actual(c) | ||||||||||||||||||
| As Reported | As Adjusted(d) | ||||||||||||||||||||||
| Site rental revenues | $6,225 | +$250 | 9% | $5,719 | 8% | 8% | |||||||||||||||||
Income (loss) from continuing operations(e) | $1,674 | +$250 | 45% | $1,158(f) | 10% | 39% | |||||||||||||||||
Income (loss) from continuing operations per share—diluted(e)(g) | $3.85 | +$0.57 | 44% | $2.67(f) | 14% | 46% | |||||||||||||||||
Adjusted EBITDA(e) | $4,272 | +$250 | 12% | $3,816 | 3% | 12% | |||||||||||||||||
AFFO(e)(g) | $3,201 | $— | 6% | $3,013 | 5% | 16% | |||||||||||||||||
AFFO per share(e)(g) | $7.36 | $— | 6% | $6.95 | 3% | 14% | |||||||||||||||||
(a)As issued on January 26, 2022.
(b)As issued on October 20, 2021.
(c)See "Results for the Year" below for our full year 2020 actual results.
(d)As Adjusted growth rates exclude the impact of the cancellation of certain small cells previously contracted with Sprint Corporation and a reduction in staffing that occurred in fourth quarter 2020 (collectively, "Nontypical Items"), as further described in our press release dated January 27, 2021 and reconciled in "Non-GAAP Financial Measures, Segment Measures and Other Calculations" herein.
(e)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for further information and reconciliation of non-GAAP financial measures to Income (loss) from continuing operations, as computed in accordance with GAAP.
(f)Does not reflect the impact related to the ATO Settlement (as defined in the Form 8-K filed with the Securities and Exchange Commission on April 26, 2021 ("April 8-K"), which is attributable to discontinued operations as discussed in the April 8-K.
(g)Attributable to CCIC common stockholders.
“We generated significant growth in 2021, including 14% AFFO per share growth and an 11% increase in our common stock dividend per share, as our customers began upgrading their existing cell sites as part of the first phase of the 5G build out in the U.S.,” stated Jay Brown, Crown Castle’s Chief Executive Officer. “We expect elevated levels of tower leasing to continue this year and believe we will once again lead the industry with the highest U.S. tower revenue growth in 2022. In addition, we secured commitments for more than 50,000 new small cell nodes during the last twelve months, which equates to approximately 70% of the total small cells we booked in our history prior to 2021. As a result, we now have approximately 55,000 small cell nodes on air and more than 60,000 committed or under construction in our backlog. Our customers are already planning for the next phase of the 5G build out that will require small cells at scale, and this inflection in our small cells business reflects how well
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positioned we are to support their wireless network needs for years to come with our more than 80,000 route miles of fiber concentrated in the top U.S. markets. I believe 2022 will be an important transition year for our small cells and fiber business, as we prepare to accelerate our deployment of small cells from approximately 5,000 this year to what we expect will be more than 10,000 per year starting in 2023.
“We believe our ability to offer towers, small cells and fiber solutions, which are all integral components of communications networks and are shared among multiple tenants, provides us the best opportunity to generate significant growth while delivering high returns for our shareholders. We believe the U.S. represents the highest growth and lowest risk market in the world for communications infrastructure ownership, and we believe our comprehensive offering positions us to benefit from what we expect will be a decade-long investment cycle as our customers develop next-generation wireless networks. As a result, we expect the deployment of 5G in the U.S. to extend our opportunity to create long-term value for our shareholders while delivering dividend per share growth of 7% to 8% per year.”
RESULTS FOR THE YEAR
The table below sets forth select preliminary unaudited financial results for the year ended December 31, 2021.
| Full Year 2021 | Full Year 2020 | Full Year 2021 Growth | ||||||||||||||||||||||||||||||||||||
| (dollars in millions, except per share amounts) | Actual | Previous Outlook Midpoint(a) | Actual Compared to Previous Outlook Midpoint(a) | As Reported | As Adjusted(b) | As Reported | As Adjusted(b) | |||||||||||||||||||||||||||||||
| Site rental revenues | $5,719 | $5,700 | +$19 | $5,320 | $5,320 | $399 | 8% | $399 | 8% | |||||||||||||||||||||||||||||
Income (loss) from continuing operations(c) | $1,158(d) | $1,114(d) | +$44 | $1,056 | $833 | $102 | 10% | $325 | 39% | |||||||||||||||||||||||||||||
Income (loss) from continuing operations per share—diluted(c)(e) | $2.67(d) | $2.57(d) | +$0.10 | $2.35 | $1.83 | $0.32 | 14% | $0.84 | 46% | |||||||||||||||||||||||||||||
Adjusted EBITDA(c) | $3,816 | $3,787 | +$29 | $3,706 | $3,420 | $110 | 3% | $396 | 12% | |||||||||||||||||||||||||||||
AFFO(c)(e) | $3,013 | $2,966 | +$47 | $2,878 | $2,592 | $135 | 5% | $421 | 16% | |||||||||||||||||||||||||||||
AFFO per share(c)(e) | $6.95 | $6.83 | +$0.12 | $6.78 | $6.10 | $0.17 | 3% | $0.85 | 14% | |||||||||||||||||||||||||||||
(a)As issued on October 20, 2021.
(b)As Adjusted figures exclude the impact of the Nontypical Items, as further described in our press release dated January 27, 2021 and reconciled in "Non-GAAP Financial Measures, Segment Measures and Other Calculations" herein.
(c)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for further information and reconciliation of non-GAAP financial measures to Income (loss) from continuing operations, as computed in accordance with GAAP.
(d)Does not reflect the impact related to the ATO Settlement (as defined in the April 8-K), which is attributable to discontinued operations as discussed in the April 8-K.
(e)Attributable to CCIC common stockholders.
HIGHLIGHTS FROM THE YEAR
References to full year 2021 growth herein are adjusted for the impact of Nontypical Items that occurred in fourth quarter 2020.
•Site rental revenues. Site rental revenues grew 8%, or $399 million, from full year 2020 to full year 2021, inclusive of approximately $307 million in Organic Contribution to Site Rental Revenues and an $89 million increase in straight-lined revenues. The $307 million in Organic Contribution to Site Rental Revenues represents approximately 5.8% growth, comprised of approximately 9.0% growth from new leasing activity and contracted tenant escalations, net of approximately 3.2% from tenant non-renewals. Fourth quarter 2021 site rental revenues benefited by approximately $10 million from items not expected to recur in 2022.
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•Income from continuing operations. Income from continuing operations for full year 2021 was $1.2 billion compared to $1.1 billion for full year 2020, or $833 million for full year 2020 as adjusted for the impact of Nontypical Items.
•Adjusted EBITDA. Full year 2021 Adjusted EBITDA was $3.8 billion compared to $3.4 billion in full year 2020, as adjusted for the impact of Nontypical Items, which represents growth of $396 million. The full year 2021 growth includes approximately $20 million of benefit from items in the fourth quarter 2021 not contemplated in the previous 2021 Outlook, including $10 million from site rental revenues that are not expected to recur in 2022 and $10 million from lower-than-expected operating expenses.
•AFFO and AFFO per share. Full year 2021 AFFO was $3.0 billion, representing 16% growth from full year 2020. The full year 2021 growth of $421 million includes the aforementioned $20 million of benefit included in Adjusted EBITDA from items recognized in the fourth quarter 2021 not contemplated in the previous 2021 Outlook, as well as lower sustaining capital expenditures than previously expected. AFFO per share for full year 2021 was $6.95, representing 14% growth when compared to full year 2020.
•Capital expenditures. Capital expenditures during the year were $1.2 billion, comprised of $87 million of sustaining capital expenditures and $1.1 billion of discretionary capital expenditures. Discretionary capital expenditures during the year primarily included approximately $907 million attributable to Fiber and approximately $202 million attributable to Towers.
•Common stock dividend. During 2021, Crown Castle paid common stock dividends of approximately $2.4 billion in the aggregate, or $5.46 per common share, an increase of approximately 11% on a per share basis compared to the same period a year ago.
“We delivered another year of significant growth with 14% AFFO per share growth in 2021, augmented by a high-quality dividend that we believe provides shareholders with a compelling total return opportunity,” stated Dan Schlanger, Crown Castle’s Chief Financial Officer. “Our customers are busy with the initial deployment of their 5G networks while also planning for the next phase that will require tens of thousands of new cell sites to increase the capacity of their networks. This activity is resulting in an elevated level of growth in our Towers business with core leasing activity for full year 2022 expected to be approximately 50% higher than the trailing five-year average. Looking beyond this year, our record backlog of more than 60,000 committed small cell nodes gives us confidence that growth for our Fiber business will accelerate beginning in 2023. As we expect to increase the pace of small cell deployments in 2023, we anticipate the level of our discretionary capital investment to also trend higher. Importantly, with a record level of collocation small cell nodes in our backlog we expect to be able to fund this higher level of investment with free cash flow and incremental debt capacity while maintaining our investment grade credit profile.”
OUTLOOK
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 SEC.
Crown Castle's current full year 2022 Outlook, set forth in the following table, is updated to reflect approximately $250 million of additional straight-lined site rental revenues for full year 2022 for its Towers segment resulting from the previously announced long-term tower and small cell agreement with T-Mobile. Except for changes resulting from this increase in straight-lined site rental revenues, full year 2022 Outlook is unchanged. The lower growth reflected in the charts below results from the higher-than-expected 2021 results and not from a
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reduction to the full year 2022 Outlook. The majority of the items that contributed to the higher-than-expected 2021 results are not expected to recur in 2022.
| (in millions, except per share amounts) | Full Year 2022 | Change to Midpoint from Previous Outlook | |||||||||||||||
| Site rental revenues | $6,202 | to | $6,247 | +$250 | |||||||||||||
Site rental cost of operations(a) | $1,548 | to | $1,593 | — | |||||||||||||
| Income (loss) from continuing operations | $1,634 | to | $1,714 | +$250 | |||||||||||||
Adjusted EBITDA(b) | $4,249 | to | $4,294 | +$250 | |||||||||||||
Interest expense and amortization of deferred financing costs(c) | $615 | to | $660 | — | |||||||||||||
FFO(b)(d) | $3,318 | to | $3,363 | +$250 | |||||||||||||
AFFO(b)(d) | $3,178 | to | $3,223 | — | |||||||||||||
AFFO per share(b)(d) | $7.31 | to | $7.41 | — | |||||||||||||
(a)Exclusive of depreciation, amortization and accretion.
(b)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for further information and reconciliation of non-GAAP financial measures to Income (loss) from continuing operations, as computed in accordance with GAAP.
(c)See reconciliation of "Components of Current Outlook for Interest Expense and Amortization of Deferred Financing Costs" for a discussion of non-cash interest expense.
(d)Attributable to CCIC common stockholders.
The chart below reconciles the components of expected growth in site rental revenues from 2021 to 2022 of $495 million to $540 million, inclusive of Organic Contribution to Site Rental Revenues during 2022 of $235 million to $275 million, or approximately 5%.
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The chart below reconciles the components of expected growth in AFFO from 2021 to 2022 of $165 million to $210 million.
Additional information is available in Crown Castle's quarterly Supplemental Information Package posted in the Investors section of our website.
CONFERENCE CALL DETAILS
Crown Castle has scheduled a conference call for Thursday, January 27, 2022, at 10:30 a.m. Eastern time to discuss its fourth quarter and full year 2021 results. The conference call may be accessed by dialing 800-458-4121 and asking for the Crown Castle call (access code 6181398) at least 30 minutes prior to the start time. The conference call may also be accessed live over the Internet at investor.crowncastle.com. Supplemental materials for the call have been posted on the Crown Castle website at investor.crowncastle.com.
A telephonic replay of the conference call will be available from 1:30 p.m. Eastern time on Thursday, January 27, 2022, through 1:30 p.m. Eastern time on Wednesday, April 27, 2022, and may be accessed by dialing 888-203-1112 and using access code 6181398. An audio archive will also be available on Crown Castle's website at investor.crowncastle.com shortly after the call and will be accessible for approximately 90 days.
ABOUT CROWN CASTLE
Crown Castle owns, operates and leases more than 40,000 cell towers and more than 80,000 route miles of fiber supporting small cells and fiber solutions across every major U.S. market. This nationwide portfolio of communications infrastructure connects cities and communities to essential data, technology and wireless service - bringing information, ideas and innovations to the people and businesses that need them. For more information on Crown Castle, please visit www.crowncastle.com.
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Non-GAAP Financial Measures, Segment Measures and Other Calculations
This press release includes presentations of Income (loss) from continuing operations (as adjusted), including per share—diluted amounts, Adjusted EBITDA, Adjusted Funds from Operations ("AFFO"), including per share amounts, Funds from Operations ("FFO"), including per share amounts, and Organic Contribution to Site Rental Revenues, which are non-GAAP financial measures. These non-GAAP financial measures are not intended as alternative measures of operating results or cash flow from operations (as determined in accordance with Generally Accepted Accounting Principles ("GAAP")).
Our non-GAAP financial measures may not be comparable to similarly titled measures of other companies, including other companies in the communications infrastructure sector or other real estate investment trusts ("REITs").
In addition to the non-GAAP financial measures used herein, we also provide Segment Site Rental Gross Margin, Segment Services and Other Gross Margin and Segment Operating Profit, which are key measures used by management to evaluate our operating segments. These segment measures are provided pursuant to GAAP requirements related to segment reporting. In addition, we provide the components of certain GAAP measures, such as capital expenditures.
Our non-GAAP financial measures are presented as additional information because management believes these measures are useful indicators of the financial performance of our business. Among other things, management believes that:
•Income (loss) from continuing operations (as adjusted), including per share—diluted amounts, is useful to investors and other interested parties in evaluating our financial performance. Management believes that this measure is meaningful to investors as it adjusts Income (loss) from continuing operations to exclude the impact of the Nontypical Items (as defined in this press release and described further in our press release dated January 27, 2021), which management believes are unusual (including with respect to magnitude), infrequent and not reasonably likely to recur in the near term, to provide further insight into our results of operations and underlying trends and projections. Management also believes that identifying the impact of Nontypical Items as adjustments provides more transparency and comparability across periods. There can be no assurances that such items will not recur in future periods. Income (loss) from continuing operations (as adjusted), including per share—diluted amounts should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.
•Adjusted EBITDA is useful to investors or other interested parties in evaluating our financial performance. Adjusted EBITDA is the primary measure used by management (1) to evaluate the economic productivity of our operations and (2) for purposes of making decisions about allocating resources to, and assessing the performance of, our operations. Management believes that Adjusted EBITDA helps investors or other interested parties meaningfully evaluate and compare the results of our operations (1) from period to period and (2) to our competitors, by removing the impact of our capital structure (primarily interest charges from our outstanding debt) and asset base (primarily depreciation, amortization and accretion) from our financial results. Management also believes Adjusted EBITDA is frequently used by investors or other interested parties in the evaluation of the communications infrastructure sector and other REITs to measure financial performance without regard to items such as depreciation, amortization and accretion which can vary depending upon accounting methods and the book value of assets. In addition, Adjusted EBITDA is similar to the measure of current financial performance generally used in our debt covenant calculations. Separately, we are also disclosing Adjusted EBITDA as adjusted to exclude the impact of Nontypical Items, which management believes are unusual (including with respect to magnitude), infrequent and not reasonably likely to recur in the near term, to provide further insight into our results of operations and underlying trends and projections. Management also believes that identifying the impact of Nontypical Items as adjustments provides increased transparency and comparability across periods. There can be no assurances that such items will not recur in future periods. Adjusted EBITDA (including as further adjusted to exclude Nontypical Items) should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.
•AFFO, including per share amounts, is useful to investors or other interested parties in evaluating our financial performance. Management believes that AFFO helps investors or other interested parties meaningfully evaluate our financial performance as it includes (1) the impact of our capital structure (primarily interest expense on our outstanding debt and dividends on our preferred stock (in periods where applicable)) and (2) sustaining capital expenditures, and excludes the impact of our (a) asset base (primarily depreciation, amortization and accretion) and (b) certain non-cash items, including straight-lined revenues and expenses related to fixed escalations and rent free periods. GAAP requires rental revenues and expenses related to leases that contain specified rental increases over the life of the lease to be recognized evenly over the life of the lease. In accordance with GAAP, if payment terms call for fixed escalations, or rent free periods, the revenue or expense is recognized on a straight-lined basis over the fixed, non-cancelable term of the contract. Management notes that Crown Castle uses AFFO only as a performance measure.
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Separately, we are also disclosing AFFO as adjusted to exclude the impact of Nontypical Items, which management believes are unusual (including with respect to magnitude), infrequent and not reasonably likely to recur in the near term, to provide further insight into our results of operations and underlying trends and projections. Management also believes that identifying the impact of Nontypical Items as adjustments provides increased transparency and comparability across periods. There can be no assurances that such items will not recur in future periods. AFFO (including as further adjusted to exclude Nontypical Items) should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance and should not be considered as an alternative to cash flows from operations or as residual cash flow available for discretionary investment.
•FFO, including per share amounts, is useful to investors or other interested parties in evaluating our financial performance. Management believes that FFO may be used by investors or other interested parties as a basis to compare our financial performance with that of other REITs. FFO helps investors or other interested parties meaningfully evaluate financial performance by excluding the impact of our asset base (primarily depreciation, amortization and accretion). FFO is not a key performance indicator used by Crown Castle. FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance and should not be considered as an alternative to cash flow from operations.
•Organic Contribution to Site Rental Revenues is useful to investors or other interested parties in understanding the components of the year-over-year changes in our site rental revenues computed in accordance with GAAP. Management uses the Organic Contribution to Site Rental Revenues to assess year-over-year growth rates for our rental activities, to evaluate current performance, to capture trends in rental rates, new leasing activities and tenant non-renewals in our core business, as well to forecast future results. Organic Contribution to Site Rental Revenues is not meant as an alternative measure of revenue and should be considered only as a supplement in understanding and assessing the performance of our site rental revenues computed in accordance with GAAP.
We define our non-GAAP financial measures, segment measures and other calculations as follows:
Non-GAAP Financial Measures
Income (loss) from continuing operations (as adjusted). We define Income (loss) from continuing operations (as adjusted) as Income (loss) from continuing operations less other operating income resulting from the Nontypical Items, plus incremental operating expenses and asset write-downs as a result of the Nontypical Items.
Income (loss) from continuing operations (as adjusted) per share—diluted. We define Income (loss) from continuing operations (as adjusted) per share—diluted as Income (loss) from continuing operations (as adjusted), divided by diluted weighted-average common shares outstanding.
Adjusted EBITDA. We define Adjusted EBITDA as Income (loss) from continuing operations plus restructuring charges (credits), asset write-down charges, acquisition and integration costs, depreciation, amortization and accretion, amortization of prepaid lease purchase price adjustments, interest expense and amortization of deferred financing costs, (gains) losses on retirement of long-term obligations, net (gain) loss on interest rate swaps, (gains) losses on foreign currency swaps, impairment of available-for-sale securities, interest income, other (income) expense, (benefit) provision for income taxes, cumulative effect of a change in accounting principle and stock-based compensation expense. Separately, Adjusted EBITDA, as adjusted to exclude the impact of Nontypical Items, reflects Adjusted EBITDA, less other operating income resulting from the Nontypical Items, plus incremental operating expenses as a result of the Nontypical Items.
Adjusted Funds from Operations. We define Adjusted Funds from Operations as FFO before straight-lined revenue, straight-lined expense, stock-based compensation expense, non-cash portion of tax provision, non-real estate related depreciation, amortization and accretion, amortization of non-cash interest expense, other (income) expense, (gains) losses on retirement of long-term obligations, net (gain) loss on interest rate swaps, (gains) losses on foreign currency swaps, impairment of available-for-sale securities, acquisition and integration costs, restructuring charges (credits), cumulative effect of a change in accounting principle and adjustments for noncontrolling interests, less sustaining capital expenditures. Separately, Adjusted Funds from Operations, as adjusted to exclude the impact of Nontypical Items, reflects Adjusted Funds from Operations, less other operating income resulting from the Nontypical Items, plus incremental operating expenses as a result of the Nontypical Items.
AFFO per share. We define AFFO per share as AFFO, including as adjusted to exclude the impact of Nontypical Items, divided by diluted weighted-average common shares outstanding.
Funds from Operations. We define Funds from Operations as Income (loss) from continuing operations plus real estate related depreciation, amortization and accretion and asset write-down charges, less noncontrolling interest and cash paid for preferred
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stock dividends (in periods where applicable), and is a measure of funds from operations attributable to CCIC common stockholders.
FFO per share. We define FFO per share as FFO divided by the diluted weighted-average common shares outstanding.
Organic Contribution to Site Rental Revenues. We define the Organic Contribution to Site Rental Revenues as the sum of the change in GAAP site rental revenues related to (1) new leasing activity, including revenues from the construction of small cells and the impact of prepaid rent, (2) escalators and less (3) non-renewals of tenant contracts.
Segment Measures
Segment Site Rental Gross Margin. We define Segment Site Rental Gross Margin as segment site rental revenues less segment site rental costs of operations, excluding stock-based compensation expense and prepaid lease purchase price adjustments recorded in consolidated site rental costs of operations.
Segment Services and Other Gross Margin. We define Segment Services and Other Gross Margin as segment services and other revenues less segment services and other costs of operations, excluding stock-based compensation expense recorded in consolidated services and other costs of operations.
Segment Operating Profit. We define Segment Operating Profit as segment site rental gross margin plus segment services and other gross margin, and segment other operating (income) expense, 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. Additionally, certain costs are shared across segments and are reflected in our segment measures through allocations that management believes to be reasonable.
Other Calculations
New leasing activity. We define new leasing activity as site rental revenues growth exclusive of the impact from straight-line accounting from (1) tenant additions across our entire portfolio, (2) renewals or extensions of tenant contracts and (3) year-over-year changes in prepaid rent amortization.
Core leasing activity. We define core leasing activity as site rental revenues growth from tenant additions across our entire portfolio and renewals or extensions of tenant contracts, exclusive of the impacts from both straight-line accounting and prepaid rent amortization.
Non-renewals. We define non-renewals of tenant contracts as the reduction in site rental revenues as a result of tenant churn, terminations and, in limited circumstances, reductions of existing lease rates.
Discretionary capital expenditures. We define discretionary capital expenditures as those capital expenditures made with respect to activities which we believe exhibit sufficient potential to enhance long-term stockholder value. They primarily consist of expansion or development of communications infrastructure (including capital expenditures related to (1) enhancing communications infrastructure in order to add new tenants for the first time or support subsequent tenant equipment augmentations or (2) modifying the structure of a communications infrastructure asset to accommodate additional tenants) and construction of new communications infrastructure. Discretionary capital expenditures also include purchases of land interests (which primarily relates to land assets under towers as we seek to manage our interests in the land beneath our towers), certain technology-related investments necessary to support and scale future customer demand for our communications infrastructure, and other capital projects.
Sustaining capital expenditures. We define sustaining capital expenditures as those capital expenditures not otherwise categorized as either discretionary or integration capital expenditures, such as (1) maintenance capital expenditures on our communications infrastructure assets that enable our tenants' ongoing quiet enjoyment of the communications infrastructure and (2) ordinary corporate capital expenditures.
The tables set forth on the following pages reconcile the non-GAAP financial measures used herein to comparable GAAP financial measures. The components in these tables may not sum to the total due to rounding.
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Reconciliations of Non-GAAP Financial Measures, Segment Measures and Other Calculations to Comparable GAAP Financial Measures:
Reconciliation of Historical Adjusted EBITDA:
| For the Three Months Ended | For the Twelve Months Ended | ||||||||||||||||||||||
| (in millions) | December 31, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 | |||||||||||||||||||
| Income (loss) from continuing operations | $ | 353 | $ | 508 | $ | 1,158 | (a) | $ | 1,056 | ||||||||||||||
| Adjustments to increase (decrease) Income (loss) from continuing operations: | |||||||||||||||||||||||
| Asset write-down charges | 12 | 64 | 21 | 74 | |||||||||||||||||||
| Acquisition and integration costs | — | 1 | 1 | 10 | |||||||||||||||||||
| Depreciation, amortization and accretion | 415 | 401 | 1,644 | 1,608 | |||||||||||||||||||
| Amortization of prepaid lease purchase price adjustments | 4 | 5 | 18 | 18 | |||||||||||||||||||
Interest expense and amortization of deferred financing costs(b) | 164 | 167 | 657 | 689 | |||||||||||||||||||
| (Gains) losses on retirement of long-term obligations | — | — | 145 | 95 | |||||||||||||||||||
| Interest income | — | — | (1) | (2) | |||||||||||||||||||
| Other (income) expense | 4 | — | 21 | 5 | |||||||||||||||||||
| (Benefit) provision for income taxes | 1 | 5 | 21 | 20 | |||||||||||||||||||
| Stock-based compensation expense | 31 | 28 | 131 | 133 | |||||||||||||||||||
Adjusted EBITDA(c)(d) | $ | 984 | $ | 1,179 | $ | 3,816 | $ | 3,706 | |||||||||||||||
Reconciliation of Current Outlook for Adjusted EBITDA:
| Full Year 2022 | |||||||||||
| (in millions) | Outlook(f) | ||||||||||
| Income (loss) from continuing operations | $1,634 | to | $1,714 | ||||||||
| Adjustments to increase (decrease) Income (loss) from continuing operations: | |||||||||||
| Asset write-down charges | $15 | to | $25 | ||||||||
| Acquisition and integration costs | $0 | to | $8 | ||||||||
| Depreciation, amortization and accretion | $1,650 | to | $1,745 | ||||||||
| Amortization of prepaid lease purchase price adjustments | $16 | to | $18 | ||||||||
Interest expense and amortization of deferred financing costs(e) | $615 | to | $660 | ||||||||
| (Gains) losses on retirement of long-term obligations | $0 | to | $100 | ||||||||
| Interest income | $(1) | to | $0 | ||||||||
| Other (income) expense | $0 | to | $5 | ||||||||
| (Benefit) provision for income taxes | $25 | to | $33 | ||||||||
| Stock-based compensation expense | $135 | to | $139 | ||||||||
Adjusted EBITDA(c)(d) | $4,249 | to | $4,294 | ||||||||
(a)Does not reflect the impact related to the ATO Settlement (as defined in the April 8-K), which is attributable to discontinued operations as discussed in the April 8-K.
(b)See reconciliation of "Components of Historical Interest Expense and Amortization of Deferred Financing Costs" for a discussion of non-cash interest expense.
(c)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definition of Adjusted EBITDA.
(d)The above reconciliation excludes line items included in our definition which are not applicable for the periods shown.
(e)See reconciliation of "Components of Current Outlook for Interest Expense and Amortization of Deferred Financing Costs" for a discussion of non-cash interest expense.
(f)As issued on January 26, 2022.
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| News Release continued: | Page 10 | |||||||
Reconciliation of Historical FFO and AFFO:
| For the Three Months Ended | For the Twelve Months Ended | ||||||||||||||||||||||
| (in millions, except per share amounts) | December 31, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 | |||||||||||||||||||
| Income (loss) from continuing operations | $ | 353 | $ | 508 | $ | 1,158 | (a) | $ | 1,056 | ||||||||||||||
| Real estate related depreciation, amortization and accretion | 402 | 388 | 1,593 | 1,555 | |||||||||||||||||||
| Asset write-down charges | 12 | 64 | 21 | 74 | |||||||||||||||||||
| Dividends/distributions on preferred stock | — | — | — | (85) | |||||||||||||||||||
FFO(b)(c)(d)(e) | $ | 767 | $ | 960 | $ | 2,772 | $ | 2,600 | |||||||||||||||
| Weighted-average common shares outstanding—diluted | 434 | 433 | 434 | 425 | |||||||||||||||||||
FFO per share(b)(c)(d)(e) | $ | 1.77 | $ | 2.22 | $ | 6.39 | $ | 6.12 | |||||||||||||||
| FFO (from above) | $ | 767 | $ | 960 | $ | 2,772 | $ | 2,600 | |||||||||||||||
| Adjustments to increase (decrease) FFO: | |||||||||||||||||||||||
| Straight-lined revenue | (38) | 5 | (111) | (22) | |||||||||||||||||||
| Straight-lined expense | 18 | 22 | 76 | 83 | |||||||||||||||||||
| Stock-based compensation expense | 31 | 28 | 131 | 133 | |||||||||||||||||||
| Non-cash portion of tax provision | (1) | (1) | 1 | 1 | |||||||||||||||||||
| Non-real estate related depreciation, amortization and accretion | 13 | 13 | 51 | 53 | |||||||||||||||||||
| Amortization of non-cash interest expense | 4 | 1 | 13 | 6 | |||||||||||||||||||
| Other (income) expense | 4 | — | 21 | 5 | |||||||||||||||||||
| (Gains) losses on retirement of long-term obligations | — | — | 145 | 95 | |||||||||||||||||||
| Acquisition and integration costs | — | 1 | 1 | 10 | |||||||||||||||||||
| Sustaining capital expenditures | (30) | (21) | (87) | (86) | |||||||||||||||||||
AFFO(b)(c)(d)(e) | $ | 768 | $ | 1,008 | $ | 3,013 | $ | 2,878 | |||||||||||||||
| Weighted-average common shares outstanding—diluted | 434 | 433 | 434 | 425 | |||||||||||||||||||
AFFO per share(b)(c)(d)(e) | $ | 1.77 | $ | 2.33 | $ | 6.95 | $ | 6.78 | |||||||||||||||
(a)Does not reflect the impact related to the ATO Settlement (as defined in the April 8-K), which is attributable to discontinued operations as discussed in the April 8-K.
(b)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of FFO and AFFO, including per share amounts.
(c)FFO and AFFO are reduced by cash paid for preferred stock dividends during the period in which they are paid.
(d)Attributable to CCIC common stockholders.
(e)The above reconciliation excludes line items included in our definition which are not applicable for the periods shown.
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| News Release continued: | Page 11 | |||||||
For Comparative Purposes - Reconciliation of Previous Outlook for FFO and AFFO:
| Previously Issued | Previously Issued | ||||||||||||||||||||||
| Full Year 2021 | Full Year 2022 | ||||||||||||||||||||||
| (in millions, except per share amounts) | Outlook(a) | Outlook(a) | |||||||||||||||||||||
| Income (loss) from continuing operations | $1,074 | to | $1,154(b) | $1,384 | to | $1,464 | |||||||||||||||||
| Real estate related depreciation, amortization and accretion | $1,569 | to | $1,649 | $1,607 | to | $1,687 | |||||||||||||||||
| Asset write-down charges | $15 | to | $25 | $15 | to | $25 | |||||||||||||||||
FFO(c)(d)(e) | $2,720 | to | $2,765 | $3,068 | to | $3,113 | |||||||||||||||||
Weighted-average common shares outstanding—diluted(f) | 434 | 435 | |||||||||||||||||||||
FFO per share(c)(d)(e)(f) | $6.27 | to | $6.37 | $7.06 | to | $7.16 | |||||||||||||||||
| FFO (from above) | $2,720 | to | $2,765 | $3,068 | to | $3,113 | |||||||||||||||||
| Adjustments to increase (decrease) FFO: | |||||||||||||||||||||||
| Straight-lined revenue | $(117) | to | $(97) | $(129) | to | $(109) | |||||||||||||||||
| Straight-lined expense | $63 | to | $83 | $56 | to | $76 | |||||||||||||||||
| Stock-based compensation expense | $133 | to | $143 | $135 | to | $139 | |||||||||||||||||
| Non-cash portion of tax provision | $(7) | to | $8 | $0 | to | $15 | |||||||||||||||||
| Non-real estate related depreciation, amortization and accretion | $46 | to | $61 | $43 | to | $58 | |||||||||||||||||
| Amortization of non-cash interest expense | $4 | to | $14 | $5 | to | $15 | |||||||||||||||||
| Other (income) expense | $1 | to | $12 | $0 | to | $5 | |||||||||||||||||
| (Gains) losses on retirement of long-term obligations | $145 | to | $145 | $0 | to | $100 | |||||||||||||||||
| Acquisition and integration costs | $0 | to | $8 | $0 | to | $8 | |||||||||||||||||
| Sustaining capital expenditures | $(104) | to | $(94) | $(113) | to | $(93) | |||||||||||||||||
AFFO(c)(d)(e) | $2,943 | to | $2,988 | $3,178 | to | $3,223 | |||||||||||||||||
Weighted-average common shares outstanding—diluted(f) | 434 | 435 | |||||||||||||||||||||
AFFO per share(c)(d)(e)(f) | $6.78 | to | $6.89 | $7.31 | to | $7.41 | |||||||||||||||||
(a)As issued on October 20, 2021.
(b)Does not reflect the impact related to the ATO Settlement (as defined in the April 8-K), which is attributable to discontinued operations as discussed in the April 8-K.
(c)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of FFO and AFFO, including per share amounts.
(d)Attributable to CCIC common stockholders.
(e)The above reconciliation excludes line items included in our definition which are not applicable for the periods shown.
(f)The assumption for diluted weighted-average common shares outstanding for full year 2022 Outlook is based on the diluted common shares outstanding as of December 31, 2021.
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| News Release continued: | Page 12 | |||||||
Reconciliation of Current Outlook for FFO and AFFO:
| Full Year 2022 | |||||||||||
| (in millions, except per share amounts) | Outlook(e) | ||||||||||
| Income (loss) from continuing operations | $1,634 | to | $1,714 | ||||||||
| Real estate related depreciation, amortization and accretion | $1,607 | to | $1,687 | ||||||||
| Asset write-down charges | $15 | to | $25 | ||||||||
FFO(a)(b)(c) | $3,318 | to | $3,363 | ||||||||
Weighted-average common shares outstanding—diluted(d) | 435 | ||||||||||
FFO per share(a)(b)(c)(d) | $7.63 | to | $7.73 | ||||||||
| FFO (from above) | $3,318 | to | $3,363 | ||||||||
| Adjustments to increase (decrease) FFO: | |||||||||||
| Straight-lined revenue | $(379) | to | $(359) | ||||||||
| Straight-lined expense | $56 | to | $76 | ||||||||
| Stock-based compensation expense | $135 | to | $139 | ||||||||
| Non-cash portion of tax provision | $0 | to | $15 | ||||||||
| Non-real estate related depreciation, amortization and accretion | $43 | to | $58 | ||||||||
| Amortization of non-cash interest expense | $5 | to | $15 | ||||||||
| Other (income) expense | $0 | to | $5 | ||||||||
| (Gains) losses on retirement of long-term obligations | $0 | to | $100 | ||||||||
| Acquisition and integration costs | $0 | to | $8 | ||||||||
| Sustaining capital expenditures | $(113) | to | $(93) | ||||||||
AFFO(a)(b)(c) | $3,178 | to | $3,223 | ||||||||
Weighted-average common shares outstanding—diluted(d) | 435 | ||||||||||
AFFO per share(a)(b)(c)(d) | $7.31 | to | $7.41 | ||||||||
(a)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of FFO and AFFO, including per share amounts.
(b)Attributable to CCIC common stockholders.
(c)The above reconciliation excludes line items included in our definition which are not applicable for the periods shown.
(d)The assumption for diluted weighted-average common shares outstanding for full year 2022 Outlook is based on the diluted common shares outstanding as of December 31, 2021.
(e)As issued on January 26, 2022.
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| News Release continued: | Page 13 | |||||||
For Comparative Purposes - Reconciliation of Previous Outlook for Adjusted EBITDA:
| Previously Issued | Previously Issued | ||||||||||||||||||||||
| Full Year 2021 | Full Year 2022 | ||||||||||||||||||||||
| (in millions) | Outlook(a) | Outlook(a) | |||||||||||||||||||||
| Income (loss) from continuing operations | $1,074 | to | $1,154(b) | $1,384 | to | $1,464 | |||||||||||||||||
| Adjustments to increase (decrease) Income (loss) from continuing operations: | |||||||||||||||||||||||
| Asset write-down charges | $15 | to | $25 | $15 | to | $25 | |||||||||||||||||
| Acquisition and integration costs | $0 | to | $8 | $0 | to | $8 | |||||||||||||||||
| Depreciation, amortization and accretion | $1,615 | to | $1,710 | $1,650 | to | $1,745 | |||||||||||||||||
| Amortization of prepaid lease purchase price adjustments | $17 | to | $19 | $16 | to | $18 | |||||||||||||||||
| Interest expense and amortization of deferred financing costs | $633 | to | $678 | $615 | to | $660 | |||||||||||||||||
| (Gains) losses on retirement of long-term obligations | $145 | to | $145 | $0 | to | $100 | |||||||||||||||||
| Interest income | $(3) | to | $0 | $(1) | to | $0 | |||||||||||||||||
| Other (income) expense | $1 | to | $12 | $0 | to | $5 | |||||||||||||||||
| (Benefit) provision for income taxes | $18 | to | $26 | $25 | to | $33 | |||||||||||||||||
| Stock-based compensation expense | $133 | to | $143 | $135 | to | $139 | |||||||||||||||||
Adjusted EBITDA(c)(d) | $3,764 | to | $3,809 | $3,999 | to | $4,044 | |||||||||||||||||
(a)As issued on October 20, 2021.
(b)Does not reflect the impact related to the ATO Settlement (as defined in the April 8-K), which is attributable to discontinued operations as discussed in the April 8-K.
(c)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definition of Adjusted EBITDA.
(d)The above reconciliation excludes line items included in our definition which are not applicable for the periods shown.
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| News Release continued: | Page 14 | |||||||
Reconciliation of Results Adjusted for Nontypical Items to As Reported Results:
Full Year 2021 | Full Year 2020 | Full Year 2021 Growth Rates | ||||||||||||||||||||||||||||||||||||||||||||||||
| (dollars in millions, except per share amounts) | As Reported | As Reported | Less: Impact from Nontypical Items | Exclusive of Impact from Nontypical Items | As Reported | Less: Impact from Nontypical Items | Exclusive of Impact from Nontypical Items | |||||||||||||||||||||||||||||||||||||||||||
| Site rental revenues | $ | 5,719 | $ | 5,320 | $ | — | $ | 5,320 | 8 | % | — | % | 8 | % | ||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations(a) | 1,158 | (c) | 1,056 | (223) | (d) | 833 | 10 | % | 29 | % | (d) | 39 | % | |||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations per share—diluted(a)(b) | 2.67 | (c) | 2.35 | (0.52) | (d) | 1.83 | 14 | % | 32 | % | (d) | 46 | % | |||||||||||||||||||||||||||||||||||||
Adjusted EBITDA(a) | 3,816 | 3,706 | (286) | (e) | 3,420 | 3 | % | 9 | % | (e) | 12 | % | ||||||||||||||||||||||||||||||||||||||
AFFO(a)(b) | 3,013 | 2,878 | (286) | (e) | 2,592 | 5 | % | 11 | % | (e) | 16 | % | ||||||||||||||||||||||||||||||||||||||
AFFO per share(a)(b) | $ | 6.95 | $ | 6.78 | $ | (0.68) | (e) | $ | 6.10 | 3 | % | 11 | % | (e) | 14 | % | ||||||||||||||||||||||||||||||||||
(a)See reconciliations herein for further information and reconciliation of non-GAAP financial measures to Income (loss) from continuing operations, as computed in accordance with GAAP.
(b)Attributable to CCIC common stockholders.
(c)Does not reflect the impact related to the ATO Settlement (as defined in the April 8-K), which is attributable to discontinued operations as discussed in the April 8-K.
(d)Impact from Nontypical Items on Income (loss) from continuing operations and Income (loss) from continuing operations per share—diluted included in the 2020 fourth quarter operating results is comprised of other operating income of $362 million, offset by incremental operating expenses of $76 million and associated asset write-downs of $63 million.
(e)Impact from Nontypical Items on Adjusted EBITDA, AFFO and AFFO per share included in the 2020 fourth quarter operating results is comprised of other operating income of $362 million, offset by incremental operating expenses of $76 million.
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| News Release continued: | Page 15 | |||||||
Components of Changes in Site Rental Revenues for the Quarters ended December 31, 2021 and 2020:
| Three Months Ended December 31, | |||||||||||
| (dollars in millions) | 2021 | 2020 | |||||||||
Components of changes in site rental revenues:(a) | |||||||||||
Prior year site rental revenues exclusive of straight-lined revenues associated with fixed escalators(b)(c) | $ | 1,357 | $ | 1,282 | |||||||
New leasing activity(b)(c) | 98 | 90 | |||||||||
| Escalators | 24 | 23 | |||||||||
| Non-renewals | (43) | (39) | |||||||||
Organic Contribution to Site Rental Revenues(d) | 79 | 74 | |||||||||
| Impact from straight-lined revenues associated with fixed escalators | 38 | (5) | |||||||||
Acquisitions(e) | — | 1 | |||||||||
| Other | — | — | |||||||||
| Total GAAP site rental revenues | $ | 1,474 | $ | 1,352 | |||||||
| Year-over-year changes in revenue: | |||||||||||
| Reported GAAP site rental revenues | 9.0 | % | |||||||||
Organic Contribution to Site Rental Revenues(d)(f) | 5.8 | % | |||||||||
Components of the Changes in Site Rental Revenues for Full Year 2021 and 2022 Outlook:
| (dollars in millions) | Full Year 2021 | Current Full Year 2022 Outlook(g) | |||||||||||||||
Components of changes in site rental revenues:(a) | |||||||||||||||||
Prior year site rental revenues exclusive of straight-lined revenues associated with fixed escalators(b)(c) | $5,298 | $5,608 | |||||||||||||||
New leasing activity(b)(c) | 384 | $325 | to | $355 | |||||||||||||
| Escalators | 93 | $95 | to | $105 | |||||||||||||
| Non-renewals | (170) | $(195) | to | $(175) | |||||||||||||
Organic Contribution to Site Rental Revenues(d) | 307 | $235 | to | $275 | |||||||||||||
| Impact from full year straight-lined revenues associated with fixed escalators | 111 | $359 | to | $379 | |||||||||||||
Acquisitions(e) | 3 | — | |||||||||||||||
| Other | — | — | |||||||||||||||
| Total GAAP site rental revenues | $5,719 | $6,202 | to | $6,247 | |||||||||||||
| Year-over-year changes in revenue: | |||||||||||||||||
| Reported GAAP site rental revenues | 7.5% | 8.8%(h) | |||||||||||||||
Organic Contribution to Site Rental Revenues(d)(f) | 5.8% | 4.5%(h) | |||||||||||||||
(a)Additional information regarding Crown Castle's site rental revenues, including projected revenue from tenant licenses, straight-lined revenues and prepaid rent is available in Crown Castle's quarterly Supplemental Information Package posted in the Investors section of its website.
(b)Includes revenues from amortization of prepaid rent in accordance with GAAP.
(c)Includes revenues from the construction of new small cell nodes, exclusive of straight-lined revenues related to fixed escalators.
(d)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" herein.
(e)Represents the contribution from recent acquisitions. The financial impact of recent acquisitions is excluded from Organic Contribution to Site Rental Revenues until the one-year anniversary of the acquisition.
(f)Calculated as the percentage change from prior year site rental revenues, exclusive of straight-lined revenues associated with fixed escalations, compared to Organic Contribution to Site Rental Revenues for the current period.
(g)As issued on January 26, 2022.
(h)Calculated based on midpoint of full year 2022 Outlook.
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| News Release continued: | Page 16 | |||||||
Components of Historical Interest Expense and Amortization of Deferred Financing Costs:
| For the Three Months Ended | |||||||||||
| (in millions) | December 31, 2021 | December 31, 2020 | |||||||||
| Interest expense on debt obligations | $ | 160 | $ | 166 | |||||||
| Amortization of deferred financing costs and adjustments on long-term debt, net | 6 | 6 | |||||||||
| Capitalized interest | (2) | (5) | |||||||||
| Interest expense and amortization of deferred financing costs | $ | 164 | $ | 167 | |||||||
Components of Current Outlook for Interest Expense and Amortization of Deferred Financing Costs:
| Full Year 2022 | |||||||||||
| (in millions) | Outlook(a) | ||||||||||
| Interest expense on debt obligations | $617 | to | $637 | ||||||||
| Amortization of deferred financing costs and adjustments on long-term debt, net | $25 | to | $30 | ||||||||
| Capitalized interest | $(20) | to | $(15) | ||||||||
| Interest expense and amortization of deferred financing costs | $615 | to | $660 | ||||||||
(a)As issued on January 26, 2022.
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| News Release continued: | Page 17 | |||||||
Debt Balances and Maturity Dates as of December 31, 2021:
| (in millions) | Face Value | Final Maturity | |||||||||
| Cash, cash equivalents and restricted cash | $ | 466 | |||||||||
3.849% Secured Notes | 1,000 | Apr. 2023 | |||||||||
Secured Notes, Series 2009-1, Class A-2(a) | 54 | Aug. 2029 | |||||||||
Tower Revenue Notes, Series 2018-1(b) | 250 | July 2043 | |||||||||
Tower Revenue Notes, Series 2015-2(b) | 700 | May 2045 | |||||||||
Tower Revenue Notes, Series 2018-2(b) | 750 | July 2048 | |||||||||
Finance leases and other obligations | 242 | Various | |||||||||
| Total secured debt | $ | 2,996 | |||||||||
2016 Revolver(c) | 665 | June 2026 | |||||||||
| 2016 Term Loan A | 1,223 | June 2026 | |||||||||
Commercial Paper Notes(d) | 265 | Jan. 2022 | |||||||||
3.150% Senior Notes | 750 | July 2023 | |||||||||
3.200% Senior Notes | 750 | Sept. 2024 | |||||||||
1.350% Senior Notes | 500 | July 2025 | |||||||||
4.450% Senior Notes | 900 | Feb. 2026 | |||||||||
3.700% Senior Notes | 750 | June 2026 | |||||||||
| 1.050% Senior Notes | 1,000 | July 2026 | |||||||||
4.000% Senior Notes | 500 | Mar. 2027 | |||||||||
3.650% Senior Notes | 1,000 | Sept. 2027 | |||||||||
3.800% Senior Notes | 1,000 | Feb. 2028 | |||||||||
4.300% Senior Notes | 600 | Feb. 2029 | |||||||||
| 3.100% Senior Notes | 550 | Nov. 2029 | |||||||||
3.300% Senior Notes | 750 | July 2030 | |||||||||
2.250% Senior Notes | 1,100 | Jan. 2031 | |||||||||
| 2.100% Senior Notes | 1,000 | Apr. 2031 | |||||||||
| 2.500% Senior Notes | 750 | July 2031 | |||||||||
| 2.900% Senior Notes | 1,250 | Apr. 2041 | |||||||||
4.750% Senior Notes | 350 | May 2047 | |||||||||
5.200% Senior Notes | 400 | Feb. 2049 | |||||||||
| 4.000% Senior Notes | 350 | Nov. 2049 | |||||||||
| 4.150% Senior Notes | 500 | July 2050 | |||||||||
| 3.250% Senior Notes | 900 | Jan. 2051 | |||||||||
| Total unsecured debt | $ | 17,803 | |||||||||
| Total net debt | $ | 20,333 | |||||||||
(a)The Senior Secured Notes, 2009-1, Class A-2 principal amortizes over a period ending in August 2029.
(b)If the respective series of such debt is not paid in full on or prior to an applicable anticipated repayment date, then the 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 additional interest (of an additional approximately 5% per annum) will accrue on the respective series. The Senior Secured Tower Revenue Notes 2015-2 have an anticipated repayment date in 2025. The Senior Secured Tower Revenue Notes, 2018-1 and 2018-2 have anticipated repayment dates in 2023 and 2028, respectively. Notes are prepayable at par if voluntarily repaid within certain repayment windows (typically twelve to eighteen months or less prior to maturity); earlier prepayment may require additional consideration.
(c)As of December 31, 2021, the undrawn availability under the $5.0 billion 2016 Revolver was $4.3 billion.
(d)As of December 31, 2021, the Company had $735 million available for issuance under the $1.0 billion unsecured commercial paper program ("CP Program"). The maturities of the Commercial Paper Notes, when outstanding, may vary but may not exceed 397 days from the date of issue.
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| News Release continued: | Page 18 | |||||||
Net Debt to Last Quarter Annualized Adjusted EBITDA Calculation:
| (dollars in millions) | For the Three Months Ended December 31, 2021 | ||||
| Total face value of debt | $ | 20,799 | |||
| Less: Ending cash, cash equivalents and restricted cash | 466 | ||||
| Total Net Debt | $ | 20,333 | |||
| Adjusted EBITDA for the three months ended December 31, 2021 | $ | 984 | |||
| Last quarter annualized Adjusted EBITDA | 3,936 | ||||
| Net Debt to Last Quarter Annualized Adjusted EBITDA | 5.2 | x | |||
Components of Capital Expenditures:(a)
| For the Three Months Ended | |||||||||||||||||||||||||||||
| (in millions) | December 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||
| Towers | Fiber | Other | Total | Towers | Fiber | Other | Total | ||||||||||||||||||||||
| Discretionary: | |||||||||||||||||||||||||||||
| Purchases of land interests | $ | 19 | $ | 2 | $ | — | $ | 21 | $ | 23 | $ | — | $ | — | $ | 23 | |||||||||||||
Communications infrastructure improvements and other capital projects | 34 | 239 | 13 | 286 | 38 | 292 | 12 | 342 | |||||||||||||||||||||
| Sustaining | 8 | 14 | 8 | 30 | 3 | 14 | 4 | 21 | |||||||||||||||||||||
| Total | $ | 61 | $ | 255 | $ | 21 | $ | 337 | $ | 64 | $ | 306 | $ | 16 | $ | 386 | |||||||||||||
| For the Twelve Months Ended | |||||||||||||||||||||||||||||
| (in millions) | December 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||
| Towers | Fiber | Other | Total | Towers | Fiber | Other | Total | ||||||||||||||||||||||
| Discretionary: | |||||||||||||||||||||||||||||
| Purchases of land interests | $ | 64 | $ | 2 | $ | — | $ | 66 | $ | 64 | $ | — | $ | — | $ | 64 | |||||||||||||
Communications infrastructure improvements and other capital projects | 138 | 905 | 33 | 1,076 | 257 | 1,179 | 38 | 1,474 | |||||||||||||||||||||
| Sustaining | 19 | 49 | 19 | 87 | 14 | 53 | 19 | 86 | |||||||||||||||||||||
| Total | $ | 221 | $ | 956 | $ | 52 | $ | 1,229 | $ | 335 | $ | 1,232 | $ | 57 | $ | 1,624 | |||||||||||||
(a)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for further discussion of our components of capital expenditures.
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| News Release continued: | Page 19 | |||||||
Cautionary Language Regarding Forward-Looking Statements
This news release contains forward-looking statements and information that are based on our management's current expectations as of the date of this news release. Statements that are not historical facts are hereby identified as forward-looking statements. In addition, words such as "estimate," "see," "anticipate," "project," "plan," "intend," "believe," "expect," "likely," "predicted," "gives confidence," "positioned," "continue," "target," "focus," and any variations of these words and similar expressions are intended to identify forward-looking statements. Such statements include our full year 2022 Outlook and plans, projections, and estimates regarding (1) potential benefits, growth, returns, capabilities, opportunities and shareholder value which may be derived from our business, strategy, risk profile, assets and customer solutions, investments, acquisitions and dividends, (2) our business, strategy, strategic position, business model and capabilities and the strength thereof, (3) 5G deployment in the United States and our customers' strategy and plans with respect thereto and demand for our assets and solutions created by such deployment and our customers' strategy and plans, (4) our long- and short-term prospects and the trends, events and industry activities impacting our business, (5) opportunities we see to deliver value to our shareholders, (6) our dividends (including timing of payment thereof), dividend targets, dividend payout ratio, and our long- and short-term dividend (including on a per share basis) growth rate, and its driving factors, (7) debt maturities, (8) cash flows, including growth thereof, (9) leasing environment (including with respect to tower application volumes) and the leasing activity we see in our business, and benefits and opportunities created thereby, (10) tenant non-renewals, including the impact and timing thereof, (11) capital expenditures, including sustaining and discretionary capital expenditures, the timing and funding thereof and any benefits that may result therefrom, (12) revenues and growth thereof (including with respect to our Towers business) and benefits derived therefrom, (13) the recurrence and impact of Nontypical Items and other nontypical items, (14) Income (loss) from continuing operations (including on a per share basis and as adjusted for Nontypical Items), (15) Adjusted EBITDA (including as adjusted for Nontypical Items), including components thereof and growth thereof, (16) costs and expenses, including interest expense and amortization of deferred financing costs, (17) FFO (including on a per share basis) and growth thereof, (18) AFFO (including on a per share basis and as adjusted for Nontypical Items) and its components and growth thereof and corresponding driving factors, (19) Organic Contribution to Site Rental Revenues and its components, including growth thereof and contributions therefrom, (20) our weighted-average common shares outstanding (including on a diluted basis) and growth thereof, (21) site rental revenues, and the growth thereof, (22) annual small cell deployment and the impacts therefrom, including any increase in run-rate, and its driving factors, (23) Fiber business growth, (24) prepaid rent, including the additions and the amortization and growth thereof, (25) the strength of the U.S. market for communications infrastructure ownership, (26) impact from T-Mobile and Sprint network consolidation, (27) strength of our balance sheet and our investment grade status and (28) the utility of certain financial measures, including non-GAAP financial measures. All future dividends are subject to declaration by our board of directors.
Such forward-looking statements are subject to certain risks, uncertainties and assumptions, including prevailing market conditions and the following:
•Our business depends on the demand for our communications infrastructure, driven primarily by demand for data, and we may be adversely affected by any slowdown in such demand. Additionally, a reduction in the amount or change in the mix of network investment by our tenants may materially and adversely affect our business (including reducing demand for our communications infrastructure or services).
•A substantial portion of our revenues is derived from a small number of tenants, and the loss, consolidation or financial instability of any of such tenants may materially decrease revenues or reduce demand for our communications infrastructure and services.
•The expansion or development of our business, including through acquisitions, increased product offerings or other strategic growth opportunities, may cause disruptions in our business, which may have an adverse effect on our business, operations or financial results.
•Our Fiber segment has expanded rapidly, and the Fiber business model contains certain differences from our Towers business model, resulting in different operational risks. If we do not successfully operate our Fiber business model or identify or manage the related operational risks, such operations may produce results that are lower than anticipated.
•Failure to timely, efficiently and safely execute on our construction projects could adversely affect our business.
•Our substantial level of indebtedness could adversely affect our ability to react to changes in our business, and the terms of our debt instruments limit our ability to take a number of actions that our management might otherwise believe to be in our best interests. In addition, if we fail to comply with our covenants, our debt could be accelerated.
•We have a substantial amount of indebtedness. In the event we do not repay or refinance such indebtedness, we could face substantial liquidity issues and might be required to issue equity securities or securities convertible into equity securities, or sell some of our assets to meet our debt payment obligations.
•Sales or issuances of a substantial number of shares of our common stock or securities convertible into shares of our common stock may adversely affect the market price of our common stock.
•As a result of competition in our industry, we may find it more difficult to negotiate favorable rates on our new or renewing tenant contracts.
•New technologies may reduce demand for our communications infrastructure or negatively impact our revenues.
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| News Release continued: | Page 20 | |||||||
•If we fail to retain rights to our communications infrastructure, including the rights to land under our towers and the right-of-way and other agreements related to our small cells and fiber, our business may be adversely affected.
•Our services business has historically experienced significant volatility in demand, which reduces the predictability of our results.
•New wireless technologies may not deploy or be adopted by tenants as rapidly or in the manner projected.
•If we fail to comply with laws or regulations which regulate our business and which may change at any time, we may be fined or even lose our right to conduct some of our business.
•If radio frequency emissions from wireless handsets or equipment on our communications infrastructure are demonstrated to cause negative health effects, potential future claims could adversely affect our operations, costs or revenues.
•Certain provisions of our restated certificate of incorporation, amended and restated by-laws 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.
•We may be vulnerable to security breaches or other unforeseen events that could adversely affect our operations, business, and reputation.
•Future dividend payments to our stockholders will reduce the availability of our cash on hand available to fund future discretionary investments, and may result in a need to incur indebtedness or issue equity securities to fund growth opportunities. In such event, the then current economic, credit market or equity market conditions will impact the availability or cost of such financing, which may hinder our ability to grow our per share results of operations.
•Remaining qualified to be taxed as a REIT involves highly technical and complex provisions of the U.S. Internal Revenue Code. Failure to remain qualified as a REIT would result in our inability to deduct dividends to stockholders when computing our taxable income, which would reduce our available cash.
•Complying with REIT requirements, including the 90% distribution requirement, may limit our flexibility or cause us to forgo otherwise attractive opportunities, including certain discretionary investments and potential financing alternatives.
•REIT related ownership limitations and transfer restrictions may prevent or restrict certain transfers of our capital stock.
•The impact of COVID-19 and related risks could materially affect our financial position, results of operations and cash flows.
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 SEC. 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.
As used in this release, the term "including," and any variation thereof, means "including without limitation."
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| News Release continued: | Page 21 | |||||||
| CROWN CASTLE INTERNATIONAL CORP. CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED) (Amounts in millions, except par values) | ||||
| December 31, 2021 | December 31, 2020 | ||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 292 | $ | 232 | |||||||
| Restricted cash | 169 | 144 | |||||||||
| Receivables, net | 543 | 431 | |||||||||
| Prepaid expenses | 105 | 95 | |||||||||
| Other current assets | 145 | 202 | |||||||||
| Total current assets | 1,254 | 1,104 | |||||||||
| Deferred site rental receivables | 1,588 | 1,408 | |||||||||
| Property and equipment, net | 15,269 | 15,162 | |||||||||
| Operating lease right-of-use assets | 6,682 | 6,464 | |||||||||
| Goodwill | 10,078 | 10,078 | |||||||||
| Other intangible assets, net | 4,046 | 4,433 | |||||||||
| Other assets, net | 123 | 119 | |||||||||
| Total assets | $ | 39,040 | $ | 38,768 | |||||||
| LIABILITIES AND EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 246 | $ | 230 | |||||||
| Accrued interest | 182 | 199 | |||||||||
| Deferred revenues | 776 | 704 | |||||||||
| Other accrued liabilities | 401 | 378 | |||||||||
| Current maturities of debt and other obligations | 72 | 129 | |||||||||
| Current portion of operating lease liabilities | 349 | 329 | |||||||||
| Total current liabilities | 2,026 | 1,969 | |||||||||
| Debt and other long-term obligations | 20,557 | 19,151 | |||||||||
| Operating lease liabilities | 6,031 | 5,808 | |||||||||
| Other long-term liabilities | 2,168 | 2,379 | |||||||||
| Total liabilities | 30,782 | 29,307 | |||||||||
| Commitments and contingencies | |||||||||||
| CCIC stockholders' equity: | |||||||||||
| Common stock, $0.01 par value; 600 shares authorized; shares issued and outstanding: December 31, 2021—432 and December 31, 2020—431 | 4 | 4 | |||||||||
| Additional paid-in capital | 18,011 | 17,933 | |||||||||
| Accumulated other comprehensive income (loss) | (4) | (4) | |||||||||
| Dividends/distributions in excess of earnings | (9,753) | (8,472) | |||||||||
| Total equity | 8,258 | 9,461 | |||||||||
| Total liabilities and equity | $ | 39,040 | $ | 38,768 | |||||||
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| News Release continued: | Page 22 | |||||||
| CROWN CASTLE INTERNATIONAL CORP. CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED) (Amounts in millions, except per share amounts) | ||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Net revenues: | |||||||||||||||||||||||
| Site rental | $ | 1,474 | $ | 1,352 | $ | 5,719 | $ | 5,320 | |||||||||||||||
| Services and other | 180 | 141 | 621 | 520 | |||||||||||||||||||
| Net revenues | 1,654 | 1,493 | 6,340 | 5,840 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
Costs of operations:(a) | |||||||||||||||||||||||
| Site rental | 387 | 401 | 1,554 | 1,521 | |||||||||||||||||||
| Services and other | 138 | 123 | 439 | 448 | |||||||||||||||||||
| Selling, general and administrative | 180 | 185 | 680 | 678 | |||||||||||||||||||
| Asset write-down charges | 12 | 64 | 21 | 74 | |||||||||||||||||||
| Acquisition and integration costs | — | 1 | 1 | 10 | |||||||||||||||||||
| Depreciation, amortization and accretion | 415 | 401 | 1,644 | 1,608 | |||||||||||||||||||
| Total operating expenses | 1,132 | 1,175 | 4,339 | 4,339 | |||||||||||||||||||
| Other operating (income) expense | — | (362) | — | (362) | |||||||||||||||||||
| Operating income (loss) | 522 | 680 | 2,001 | 1,863 | |||||||||||||||||||
| Interest expense and amortization of deferred financing costs | (164) | (167) | (657) | (689) | |||||||||||||||||||
| Gains (losses) on retirement of long-term obligations | — | — | (145) | (95) | |||||||||||||||||||
| Interest income | — | — | 1 | 2 | |||||||||||||||||||
| Other income (expense) | (4) | — | (21) | (5) | |||||||||||||||||||
| Income (loss) before income taxes | 354 | 513 | 1,179 | 1,076 | |||||||||||||||||||
| Benefit (provision) for income taxes | (1) | (5) | (21) | (20) | |||||||||||||||||||
| Income (loss) from continuing operations | 353 | 508 | 1,158 | 1,056 | |||||||||||||||||||
| Discontinued operations: | |||||||||||||||||||||||
| Net gain (loss) from disposal of discontinued operations, net of tax | — | — | (62) | — | |||||||||||||||||||
| Income (loss) from discontinued operations, net of tax | — | — | (62) | — | |||||||||||||||||||
| Net income (loss) | 353 | 508 | 1,096 | 1,056 | |||||||||||||||||||
| Dividends/distributions on preferred stock | — | — | — | (57) | |||||||||||||||||||
Net income (loss) attributable to CCIC common stockholders | $ | 353 | $ | 508 | $ | 1,096 | $ | 999 | |||||||||||||||
Net income (loss) attributable to CCIC common stockholders, per common share: | |||||||||||||||||||||||
| Income (loss) from continuing operations, basic | $ | 0.82 | $ | 1.17 | $ | 2.68 | $ | 2.36 | |||||||||||||||
| Income (loss) from discontinued operations, basic | — | — | (0.14) | — | |||||||||||||||||||
| Net income (loss) attributable to CCIC common stockholders, basic | $ | 0.82 | $ | 1.17 | $ | 2.54 | $ | 2.36 | |||||||||||||||
| Income (loss) from continuing operations, diluted | $ | 0.81 | $ | 1.17 | $ | 2.67 | $ | 2.35 | |||||||||||||||
| Income (loss) from discontinued operations, diluted | — | — | (0.14) | — | |||||||||||||||||||
| Net income (loss) attributable to CCIC common stockholders, diluted | $ | 0.81 | $ | 1.17 | $ | 2.53 | $ | 2.35 | |||||||||||||||
| Weighted-average common shares outstanding: | |||||||||||||||||||||||
| Basic | 432 | 431 | 432 | 423 | |||||||||||||||||||
| Diluted | 434 | 433 | 434 | 425 | |||||||||||||||||||
(a)Exclusive of depreciation, amortization and accretion shown separately.
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| News Release continued: | Page 23 | |||||||
| CROWN CASTLE INTERNATIONAL CORP. CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED) (In millions of dollars) | ||||
| Twelve Months Ended December 31, | |||||||||||
| 2021 | 2020 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Income (loss) from continuing operations | $ | 1,158 | $ | 1,056 | |||||||
| Adjustments to reconcile Income (loss) from continuing operations to net cash provided by (used for) operating activities: | |||||||||||
| Depreciation, amortization and accretion | 1,644 | 1,608 | |||||||||
| (Gains) losses on retirement of long-term obligations | 145 | 95 | |||||||||
| Amortization of deferred financing costs and other non-cash interest, net | 13 | 6 | |||||||||
| Stock-based compensation expense | 129 | 138 | |||||||||
| Asset write-down charges | 21 | 74 | |||||||||
| Deferred income tax (benefit) provision | 4 | 3 | |||||||||
| Other non-cash adjustments, net | 21 | 5 | |||||||||
| Changes in assets and liabilities, excluding the effects of acquisitions: | |||||||||||
| Increase (decrease) in liabilities | (120) | (111) | |||||||||
| Decrease (increase) in assets | (226) | 181 | |||||||||
| Net cash provided by (used for) operating activities | 2,789 | 3,055 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | (1,229) | (1,624) | |||||||||
| Payments for acquisitions, net of cash acquired | (111) | (107) | |||||||||
| Other investing activities, net | 8 | (10) | |||||||||
| Net cash provided by (used for) investing activities | (1,332) | (1,741) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from issuance of long-term debt | 3,985 | 3,733 | |||||||||
| Principal payments on debt and other long-term obligations | (1,076) | (105) | |||||||||
| Purchases and redemptions of long-term debt | (2,089) | (2,490) | |||||||||
| Borrowings under revolving credit facility | 1,245 | 2,430 | |||||||||
| Payments under revolving credit facility | (870) | (2,665) | |||||||||
| Net borrowings (repayments) under commercial paper program | (20) | 130 | |||||||||
| Payments for financing costs | (42) | (38) | |||||||||
| Purchases of common stock | (70) | (76) | |||||||||
| Dividends/distributions paid on common stock | (2,373) | (2,105) | |||||||||
| Dividends/distributions paid on preferred stock | — | (85) | |||||||||
| Net cash provided by (used for) financing activities | (1,310) | (1,271) | |||||||||
| Net increase (decrease) in cash, cash equivalents, and restricted cash - continuing operations | 147 | 43 | |||||||||
| Discontinued operations: | |||||||||||
| Net cash provided by (used for) operating activities | (62) | — | |||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash - discontinued operations | (62) | — | |||||||||
| Effect of exchange rate changes on cash | — | — | |||||||||
| Cash, cash equivalents, and restricted cash at beginning of period | 381 | 338 | |||||||||
| Cash, cash equivalents, and restricted cash at end of period | $ | 466 | $ | 381 | |||||||
| Supplemental disclosure of cash flow information: | |||||||||||
| Interest paid | 661 | 653 | |||||||||
| Income taxes paid | 20 | 19 | |||||||||
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| News Release continued: | Page 24 | |||||||
| CROWN CASTLE INTERNATIONAL CORP. SEGMENT OPERATING RESULTS (UNAUDITED) (In millions of dollars) | ||||
| SEGMENT OPERATING RESULTS | |||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended December 31, 2021 | Three Months Ended December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||
| Towers | Fiber | Other | Consolidated Total | Towers | Fiber | Other | Consolidated Total | ||||||||||||||||||||||||||||||||||||||||
| Segment site rental revenues | $ | 985 | $ | 489 | $ | 1,474 | $ | 884 | $ | 468 | $ | 1,352 | |||||||||||||||||||||||||||||||||||
| Segment services and other revenues | 174 | 6 | 180 | 133 | 8 | 141 | |||||||||||||||||||||||||||||||||||||||||
| Segment revenues | 1,159 | 495 | 1,654 | 1,017 | 476 | 1,493 | |||||||||||||||||||||||||||||||||||||||||
| Segment site rental costs of operations | 231 | 148 | 379 | 218 | 173 | 391 | |||||||||||||||||||||||||||||||||||||||||
| Segment services and other costs of operations | 130 | 6 | 136 | 117 | 5 | 122 | |||||||||||||||||||||||||||||||||||||||||
Segment costs of operations(a)(b) | 361 | 154 | 515 | 335 | 178 | 513 | |||||||||||||||||||||||||||||||||||||||||
Segment site rental gross margin(c) | 754 | 341 | 1,095 | 666 | 295 | 961 | |||||||||||||||||||||||||||||||||||||||||
Segment services and other gross margin(c) | 44 | — | 44 | 16 | 3 | 19 | |||||||||||||||||||||||||||||||||||||||||
Segment selling, general and administrative expenses(b) | 29 | 41 | 70 | 30 | 49 | 79 | |||||||||||||||||||||||||||||||||||||||||
| Segment other operating (income) expense | — | — | — | — | (362) | (362) | |||||||||||||||||||||||||||||||||||||||||
Segment operating profit(c) | 769 | 300 | 1,069 | 652 | 611 | 1,263 | |||||||||||||||||||||||||||||||||||||||||
Other selling, general and administrative expenses(b) | $ | 85 | 85 | $ | 84 | 84 | |||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation expense | 31 | 31 | 28 | 28 | |||||||||||||||||||||||||||||||||||||||||||
Depreciation, amortization and accretion | 415 | 415 | 401 | 401 | |||||||||||||||||||||||||||||||||||||||||||
Interest expense and amortization of deferred financing costs | 164 | 164 | 167 | 167 | |||||||||||||||||||||||||||||||||||||||||||
Other (income) expenses to reconcile to income (loss) before income taxes(d) | 20 | 20 | 70 | 70 | |||||||||||||||||||||||||||||||||||||||||||
Income (loss) before income taxes | $ | 354 | $ | 513 | |||||||||||||||||||||||||||||||||||||||||||
| FIBER SEGMENT SITE RENTAL REVENUES SUMMARY | |||||||||||||||||||||||||||||||||||
| Three Months Ended December 31, | |||||||||||||||||||||||||||||||||||
| 2021 | 2020 | ||||||||||||||||||||||||||||||||||
| Fiber Solutions | Small Cells | Total | Fiber Solutions | Small Cells | Total | ||||||||||||||||||||||||||||||
| Site rental revenues | $ | 331 | $ | 158 | $ | 489 | $ | 325 | $ | 143 | $ | 468 | |||||||||||||||||||||||
(a) Exclusive of depreciation, amortization and accretion shown separately.
(b) Segment costs of operations excludes (1) stock-based compensation expense of $6 million in each of the three months ended December 31, 2021 and 2020 (2) prepaid lease purchase price adjustments of $4 million and $5 million for the three months ended December 31, 2021 and 2020, respectively. Selling, general and administrative expenses exclude stock-based compensation expense of $25 million and $22 million for the three months ended December 31, 2021 and 2020, respectively.
(c) See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of segment site rental gross margin, segment services and other gross margin and segment operating profit.
(d) See condensed consolidated statement of operations for further information.
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| News Release continued: | Page 25 | |||||||
| SEGMENT OPERATING RESULTS | |||||||||||||||||||||||||||||||||||||||||||||||
| Twelve Months Ended December 31, 2021 | Twelve Months Ended December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||
| Towers | Fiber | Other | Consolidated Total | Towers | Fiber | Other | Consolidated Total | ||||||||||||||||||||||||||||||||||||||||
| Segment site rental revenues | $ | 3,804 | $ | 1,915 | $ | 5,719 | $ | 3,497 | $ | 1,823 | $ | 5,320 | |||||||||||||||||||||||||||||||||||
| Segment services and other revenues | 601 | 20 | 621 | 500 | 20 | 520 | |||||||||||||||||||||||||||||||||||||||||
| Segment revenues | 4,405 | 1,935 | 6,340 | 3,997 | 1,843 | 5,840 | |||||||||||||||||||||||||||||||||||||||||
| Segment site rental costs of operations | 889 | 633 | 1,522 | 866 | 620 | 1,486 | |||||||||||||||||||||||||||||||||||||||||
| Segment services and other costs of operations | 414 | 17 | 431 | 429 | 12 | 441 | |||||||||||||||||||||||||||||||||||||||||
Segment costs of operations(a)(b) | 1,303 | 650 | 1,953 | 1,295 | 632 | 1,927 | |||||||||||||||||||||||||||||||||||||||||
Segment site rental gross margin(c) | 2,915 | 1,282 | 4,197 | 2,631 | 1,203 | 3,834 | |||||||||||||||||||||||||||||||||||||||||
Segment services and other gross margin(c) | 187 | 3 | 190 | 71 | 8 | 79 | |||||||||||||||||||||||||||||||||||||||||
Segment selling, general and administrative expenses(b) | 107 | 174 | 281 | 100 | 186 | 286 | |||||||||||||||||||||||||||||||||||||||||
| Segment other operating (income) expense | — | — | — | — | (362) | (362) | |||||||||||||||||||||||||||||||||||||||||
Segment operating profit(c) | 2,995 | 1,111 | 4,106 | 2,602 | 1,387 | 3,989 | |||||||||||||||||||||||||||||||||||||||||
Other selling, general and administrative expenses(b) | $ | 290 | 290 | $ | 283 | 283 | |||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation expense | 131 | 131 | 133 | 133 | |||||||||||||||||||||||||||||||||||||||||||
Depreciation, amortization and accretion | 1,644 | 1,644 | 1,608 | 1,608 | |||||||||||||||||||||||||||||||||||||||||||
Interest expense and amortization of deferred financing costs | 657 | 657 | 689 | 689 | |||||||||||||||||||||||||||||||||||||||||||
Other (income) expenses to reconcile to income (loss) before income taxes(d) | 205 | 205 | 200 | 200 | |||||||||||||||||||||||||||||||||||||||||||
Income (loss) before income taxes | $ | 1,179 | $ | 1,076 | |||||||||||||||||||||||||||||||||||||||||||
| FIBER SEGMENT SITE RENTAL REVENUES SUMMARY | |||||||||||||||||||||||||||||||||||
| Twelve Months Ended December 31, | |||||||||||||||||||||||||||||||||||
| 2021 | 2020 | ||||||||||||||||||||||||||||||||||
| Fiber Solutions | Small Cells | Total | Fiber Solutions | Small Cells | Total | ||||||||||||||||||||||||||||||
| Site rental revenues | $ | 1,318 | $ | 597 | $ | 1,915 | $ | 1,275 | $ | 548 | $ | 1,823 | |||||||||||||||||||||||
(a) Exclusive of depreciation, amortization and accretion shown separately.
(b) Segment costs of operations excludes (1) stock-based compensation expense of $22 million and $24 million for the twelve months ended December 31, 2021 and 2020, respectively and (2) prepaid lease purchase price adjustments of $18 million in each of the twelve months ended December 31, 2021 and 2020. Selling, general and administrative expenses exclude stock-based compensation expense of $109 million in each of the twelve months ended December 31, 2021 and 2020.
(c) See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of segment site rental gross margin, segment services and other gross margin and segment operating profit.
(d) See condensed consolidated statement of operations for further information.
The pathway to possible.
CrownCastle.com
Exhibit 99.2
Supplemental Information Package
and Non-GAAP Reconciliations
Fourth Quarter • December 31, 2021
The pathway to possible.
CrownCastle.com
Crown Castle International Corp.
Fourth Quarter 2021
| TABLE OF CONTENTS | |||||
| Page | |||||
| Company Overview | |||||
| Company Profile | |||||
| Strategy | |||||
| AFFO per Share | |||||
| Asset Portfolio Footprint | |||||
| General Company Information | |||||
| Research Coverage | |||||
| Historical Common Stock Data | |||||
| Portfolio and Financial Highlights | |||||
| Outlook | |||||
| New Leasing Activity by Segment | |||||
| Financials & Metrics | |||||
| Condensed Consolidated Balance Sheet | |||||
| Condensed Consolidated Statement of Operations | |||||
| Segment Operating Results | |||||
| Fiber Segment Site Rental Revenues Summary | |||||
| FFO and AFFO Reconciliations | |||||
| Condensed Consolidated Statement of Cash Flows | |||||
| Components of Changes in Site Rental Revenues | |||||
| Summary of Straight-Lined Revenues and Expenses and Prepaid Rent Activity | |||||
| Summary of Capital Expenditures | |||||
| Projected Revenues from Tenant Contracts | |||||
| Projected Expenses from Existing Ground Leases and Fiber Access Agreements | |||||
| Lease Renewal and Lease Distribution | |||||
| Consolidated Tenant Overview | |||||
| Fiber Solutions Revenue Mix | |||||
| Segment Cash Yields on Invested Capital | |||||
| Consolidated Return on Invested Capital | |||||
| Asset Portfolio Overview | |||||
| Summary of Tower Portfolio by Vintage | |||||
| Tower Portfolio Overview | |||||
| Ground Interest Overview | |||||
| Ground Interest Activity | |||||
| Capitalization Overview | |||||
| Capitalization Overview | |||||
| Debt Maturity Overview | |||||
| Liquidity Overview | |||||
| Maintenance and Financial Covenants | |||||
| Interest Rate Sensitivity | |||||
| Appendix | |||||
1
Crown Castle International Corp.
Fourth Quarter 2021
Cautionary Language Regarding Forward-Looking Statements
This supplemental information package ("Supplement") contains forward-looking statements and information that are based on our management's current expectations as of the date of this Supplement. Statements that are not historical facts are hereby identified as forward-looking statements. Words such as "Outlook," "guide," "forecast," "estimate," "anticipate," "project," "plan," "intend," "believe," "expect," "likely," "predicted," "positioned," and any variations of these words and similar expressions are intended to identify such forward looking statements. Such statements include plans, projections and estimates regarding (1) demand for data and our communications infrastructure, and benefits derived therefrom, (2) cash flow growth, (3) tenant additions, (4) our Outlook for full year 2022, (5) our strategy, (6) strategic position of our assets, (7) revenues from tenant contracts, (8) expenses from existing ground leases and fiber access agreements, (9) the recurrence and impact of Nontypical Items, (10) availability under our 2016 Revolver and (11) the impact of our recent long-term agreement with T-Mobile.
Such forward-looking statements are subject to certain risks, uncertainties and assumptions, including, but not limited to, prevailing market conditions. 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. Crown Castle assumes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. More information about potential risk factors which could affect our results is included in our filings with the Securities and Exchange Commission ("SEC"). 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.
This Supplement contains certain figures, projections and calculations based in part on management's underlying assumptions. Management believes these assumptions are reasonable; however, other reasonable assumptions could provide differing outputs.
The components of financial information presented herein, both historical and forward looking, may not sum due to rounding. Definitions and reconciliations of non-GAAP financial measures, segment measures and other calculations are provided in the Appendix to this Supplement.
As used herein, the term "including" and any variation thereof, means "including without limitation." The use of the word "or" herein is not exclusive.
2
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
COMPANY PROFILE | ||||||||||||||
Crown Castle International Corp. (to which the terms "Crown Castle," "CCIC," "we," "our," "the Company" or "us" as used herein refer) owns, operates and leases shared communications infrastructure that is geographically dispersed throughout the U.S., including (1) more than 40,000 towers and other structures, such as rooftops (collectively, "towers"), and (2) more than 80,000 route miles of fiber primarily supporting small cell networks ("small cells") and fiber solutions. We refer to our towers, fiber and small cells assets collectively as "communications infrastructure," and to our customers on our communications infrastructure as "tenants." Our towers have a significant presence in each of the top 100 basic trading areas, and the majority of our small cells and fiber are located in major metropolitan areas, including a presence within every major U.S. market.
Our operating segments consist of (1) Towers and (2) Fiber, which includes both small cells and fiber solutions. Our core business is providing access, including space or capacity, to our shared communications infrastructure via long-term contracts in various forms, including lease, license, sublease and service agreements (collectively, "tenant contracts"). We seek to increase our site rental revenues by adding more tenants on our shared communications infrastructure, which we expect to result in significant incremental cash flows due to our low incremental operating costs.
We operate as a Real Estate Investment Trust ("REIT") for U.S. federal income tax purposes.
STRATEGY | ||||||||||||||
As a leading provider of shared communications infrastructure in the U.S., our strategy is to create long-term stockholder value via a combination of (1) growing cash flows generated from our existing portfolio of communications infrastructure, (2) returning a meaningful portion of our cash generated by operating activities to our common stockholders in the form of dividends and (3) investing capital efficiently to grow cash flows and long-term dividends per share. Our strategy is based, in part, on our belief that the U.S. is the most attractive market for shared communications infrastructure investment with the greatest long-term growth potential. We measure our efforts to create "long-term stockholder value" by the combined payment of dividends to stockholders and growth in our per-share results. The key elements of our strategy are to:
•Grow cash flows from our existing communications infrastructure. We are focused on maximizing the recurring site rental cash flows generated from providing our tenants with long-term access to our shared infrastructure assets, which we believe is the core driver of value for our stockholders. Tenant additions or modifications of existing tenant equipment (collectively, "tenant additions") enable our tenants to expand coverage and capacity in order to meet increasing demand for data, while generating high incremental returns for our business. We believe our product offerings of towers and small cells provide a comprehensive solution to our wireless tenants' growing network needs through our shared communications infrastructure model, which is an efficient and cost-effective way to serve our tenants. Additionally, we believe our ability to share our fiber assets across multiple tenants to deploy both small cells and offer fiber solutions allows us to generate cash flows and increase stockholder return.
•Return cash generated by operating activities to common stockholders in the form of dividends. We believe that distributing a meaningful portion of our cash generated by operating activities appropriately provides common stockholders with increased certainty for a portion of expected long-term stockholder value while still allowing us to retain sufficient flexibility to invest in our business and deliver growth. We believe this decision reflects the translation of the high-quality, long-term contractual cash flows of our business into stable capital returns to common stockholders.
•Invest capital efficiently to grow cash flows and long-term dividends per share. In addition to adding tenants to existing communications infrastructure, we seek to invest our available capital, including the net cash generated by our operating activities and external financing sources, in a manner that will increase long-term stockholder value on a risk-adjusted basis. These investments include constructing and acquiring new communications infrastructure that we expect will generate future cash flow growth and attractive long-term returns by adding tenants to those assets over time. Our historical investments have included the following (in no particular order):
◦construction of towers, fiber and small cells;
◦acquisitions of towers, fiber and small cells;
◦acquisitions of land interests (which primarily relate to land assets under towers);
◦improvements and structural enhancements to our existing communications infrastructure;
◦purchases of shares of our common stock from time to time; and
◦purchases, repayments or redemptions of our debt.
3
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
Our strategy to create long-term stockholder value is based on our belief that there will be considerable future demand for our communications infrastructure based on the location of our assets and the rapid growth in the demand for data. We believe that such demand for our communications infrastructure will continue, will result in growth of our cash flows due to tenant additions on our existing communications infrastructure, and will create other growth opportunities for us, such as demand for newly constructed or acquired communications infrastructure, as described above. Further, we seek to augment the long-term value creation associated with growing our recurring site rental cash flows by offering certain ancillary site development and installation services within our Towers segment.
4
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
AFFO PER SHARE(a)(b) | ||
| ASSET PORTFOLIO FOOTPRINT | ||||||||
 | ||||||||
(a)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for further information and reconciliation of non-GAAP financial measures to Income (loss) from continuing operations, as computed in accordance with GAAP.
(b)Attributable to CCIC common stockholders.
(c)Excludes the impact of nontypical items that were completed in fourth quarter 2020 ("Nontypical Items"), as described in our press release dated January 27, 2021 and reconciled in "Non-GAAP Financial Measures, Segment Measures and Other Calculations" herein.
(d)Calculated based on midpoint of Outlook for full year 2022, issued on January 26, 2022.
5
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| GENERAL COMPANY INFORMATION | |||||
| Principal executive offices | 8020 Katy Freeway, Houston, TX 77024 | ||||
| Common shares trading symbol | CCI | ||||
| Stock exchange listing | New York Stock Exchange | ||||
| Fiscal year ending date | December 31 | ||||
| Fitch - Long Term Issuer Default Rating | BBB+ | ||||
| Moody’s - Long Term Corporate Family Rating | Baa3 | ||||
| Standard & Poor’s - Long Term Local Issuer Credit Rating | BBB- | ||||
Note: These credit ratings may not reflect the potential risks relating to the structure or trading of the Company’s securities and are provided solely for informational purposes. Credit ratings are not recommendations to buy, sell or hold any security, and may be revised or withdrawn at any time by the issuing organization in its sole discretion. The Company does not undertake any obligation to maintain the ratings or to advise of any change in the ratings. Each agency’s rating should be evaluated independently of any other agency’s rating. An explanation of the significances of the ratings can be obtained from each of the ratings agencies.
| EXECUTIVE MANAGEMENT TEAM | |||||||||||
| Name | Age | Years with Company | Position | ||||||||
| Jay A. Brown | 49 | 22 | President and Chief Executive Officer | ||||||||
| Daniel K. Schlanger | 48 | 5 | Executive Vice President and Chief Financial Officer | ||||||||
| Catherine Piche | 51 | 10 | Executive Vice President and Chief Operating Officer - Towers | ||||||||
| Christopher D. Levendos | 54 | 3 | Executive Vice President and Chief Operating Officer - Fiber | ||||||||
| Kenneth J. Simon | 61 | 6 | Executive Vice President and General Counsel | ||||||||
| Michael J. Kavanagh | 53 | 11 | Executive Vice President and Chief Commercial Officer | ||||||||
| Philip M. Kelley | 49 | 24 | Executive Vice President - Corporate Development and Strategy | ||||||||
| Laura B. Nichol | 61 | 7 | Executive Vice President - Business Support | ||||||||
| BOARD OF DIRECTORS | ||||||||||||||
| Name | Position | Committees | Age | Years as Director | ||||||||||
| J. Landis Martin | Chair | NESG(a) | 76 | 25 | ||||||||||
| P. Robert Bartolo | Director | Audit, Compensation | 50 | 7 | ||||||||||
| Cindy Christy | Director | Compensation, NESG(a), Strategy | 55 | 14 | ||||||||||
| Ari Q. Fitzgerald | Director | Compensation, NESG(a), Strategy | 59 | 19 | ||||||||||
| Anthony J. Melone | Director | Audit, NESG(a), Strategy | 61 | 6 | ||||||||||
| Jay A. Brown | Director | 49 | 5 | |||||||||||
| Andrea J. Goldsmith | Director | NESG(a), Strategy | 57 | 3 | ||||||||||
| Lee W. Hogan | Director | Audit, Compensation, Strategy | 77 | 20 | ||||||||||
| Tammy K. Jones | Director | Audit, NESG(a) | 56 | 1 | ||||||||||
| W. Benjamin Moreland | Director | Strategy | 58 | 15 | ||||||||||
| Kevin A. Stephens | Director | Audit, Strategy | 60 | 1 | ||||||||||
| Matthew Thornton III | Director | Compensation, Strategy | 63 | 1 | ||||||||||
(a)Nominating, Environmental, Social and Governance Committee
6
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| RESEARCH COVERAGE | ||||||||
| Equity Research | ||||||||
| Bank of America David Barden (646) 855-1320 | Barclays Tim Long (212) 526-4043 | Citigroup Michael Rollins (212) 816-1116 | ||||||
| Cowen and Company Colby Synesael (646) 562-1355 | Credit Suisse Sami Badri (212) 538-1727 | Deutsche Bank Matthew Niknam (212) 250-4711 | ||||||
| Goldman Sachs Brett Feldman (212) 902-8156 | Green Street David Guarino (949) 640-8780 | Jefferies Jonathan Petersen (212) 284-1705 | ||||||
| JPMorgan Philip Cusick (212) 622-1444 | KeyBanc Brandon Nispel (503) 821-3871 | LightShed Partners Walter Piecyk (646) 450-9258 | ||||||
| MoffettNathanson Nick Del Deo (212) 519-0025 | Morgan Stanley Simon Flannery (212) 761-6432 | New Street Research Jonathan Chaplin (212) 921-9876 | ||||||
| Oppenheimer & Co. Timothy Horan (212) 667-8137 | Raymond James Ric Prentiss (727) 567-2567 | RBC Capital Markets Jonathan Atkin (415) 633-8589 | ||||||
| Truist Securities Greg Miller (212) 303-4169 | UBS Batya Levi (212) 713-8824 | Wells Fargo Securities, LLC Eric Luebchow (312) 630-2386 | ||||||
| Wolfe Research Andrew Rosivach (646) 582-9350 | ||||||||
| Rating Agencies | ||||||||
| Fitch John Culver (312) 368-3216 | Moody’s Lori Marks (212) 553-1098 | Standard & Poor’s Ryan Gilmore (212) 438-0602 | ||||||
| HISTORICAL COMMON STOCK DATA | |||||||||||||||||
| Three Months Ended | |||||||||||||||||
| (in millions, except per share amounts) | 12/31/21 | 9/30/21 | 6/30/21 | 3/31/21 | 12/31/20 | ||||||||||||
High price(a) | $ | 209.87 | $ | 201.70 | $ | 196.39 | $ | 171.68 | $ | 165.74 | |||||||
Low price(a) | $ | 165.05 | $ | 171.86 | $ | 168.03 | $ | 141.76 | $ | 146.73 | |||||||
Period end closing price(b) | $ | 208.74 | $ | 172.04 | $ | 192.30 | $ | 168.53 | $ | 154.53 | |||||||
| Dividends paid per common share | $ | 1.47 | $ | 1.33 | $ | 1.33 | $ | 1.33 | $ | 1.33 | |||||||
Volume weighted average price for the period(a) | $ | 182.39 | $ | 190.02 | $ | 183.32 | $ | 155.47 | $ | 155.81 | |||||||
| Common shares outstanding, at period end | 432 | 432 | 432 | 432 | 431 | ||||||||||||
Market value of outstanding common shares, at period end(c) | $ | 90,220 | $ | 74,355 | $ | 83,111 | $ | 72,837 | $ | 66,651 | |||||||
(a) Based on the sales price, adjusted for common stock dividends, as reported by Bloomberg.
(b) Based on the period end closing price, adjusted for common stock dividends, as reported by Bloomberg.
(c) Period end market value of outstanding common shares is calculated as the product of (1) shares of common stock outstanding at period end and (2) closing share price at period end, adjusted for common stock dividends, as reported by Bloomberg.
7
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| SUMMARY PORTFOLIO HIGHLIGHTS | |||||
| (as of December 31, 2021) | |||||
| Towers | |||||
Number of towers (in thousands)(a) | 40 | ||||
| Average number of tenants per tower | 2.3 | ||||
Remaining contracted tenant receivables ($ in billions)(b)(c) | $ | 26 | |||
Weighted average remaining tenant contract term (years)(c)(d) | 6 | ||||
| Percent of towers in the Top 50 / 100 Basic Trading Areas | 56% / 71% | ||||
Percent of ground leased / owned(e) | 59% / 41% | ||||
Weighted average maturity of ground leases (years)(e)(f) | 36 | ||||
| Fiber | |||||
| Number of route miles of fiber (in thousands) | 80 | ||||
Remaining contracted tenant receivables ($ in billions)(b)(c) | $ | 5 | |||
Weighted average remaining tenant contract term (years)(c)(d) | 4 | ||||
| SUMMARY FINANCIAL HIGHLIGHTS | ||||||||||||||||||||||||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||||||||||||
| (in millions, except per share amounts) | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
| Operating Data: | ||||||||||||||||||||||||||
| Net revenues | ||||||||||||||||||||||||||
| Site rental | $ | 1,474 | $ | 1,352 | $ | 5,719 | $ | 5,320 | ||||||||||||||||||
| Services and other | 180 | 141 | 621 | 520 | ||||||||||||||||||||||
| Net revenues | $ | 1,654 | $ | 1,493 | $ | 6,340 | $ | 5,840 | ||||||||||||||||||
Costs of operations (exclusive of depreciation, amortization and accretion) | ||||||||||||||||||||||||||
| Site rental | $ | 387 | $ | 401 | $ | 1,554 | $ | 1,521 | ||||||||||||||||||
| Services and other | 138 | 123 | 439 | 448 | ||||||||||||||||||||||
| Total cost of operations | $ | 525 | $ | 524 | $ | 1,993 | $ | 1,969 | ||||||||||||||||||
| Net income (loss) attributable to CCIC common stockholders | $ | 353 | $ | 508 | $ | 1,096 | $ | 999 | ||||||||||||||||||
Net income (loss) attributable to CCIC common stockholders per share—diluted(g) | $ | 0.81 | $ | 1.17 | $ | 2.53 | $ | 2.35 | ||||||||||||||||||
Non-GAAP Data:(h) | ||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 984 | $ | 1,179 | $ | 3,816 | $ | 3,706 | ||||||||||||||||||
FFO(i) | 767 | 960 | 2,772 | 2,600 | ||||||||||||||||||||||
AFFO(i) | 768 | 1,008 | 3,013 | 2,878 | ||||||||||||||||||||||
AFFO per share(g)(i) | $ | 1.77 | $ | 2.33 | $ | 6.95 | $ | 6.78 | ||||||||||||||||||
(a)Excludes third-party land interests.
(b)Excludes renewal terms at tenants' option.
(c)Excludes the impact of the Company’s long-term agreement with T-Mobile, effective January 1, 2022, as further described in the Form 8-K filed with the Securities and Exchange Commission on January 6, 2022 ("January 8-K"), which will be reflected beginning with the Company’s first quarter 2022 Supplement.
(d)Excludes renewal terms at tenants' option, weighted by site rental revenues.
(e)Weighted by Towers segment site rental gross margin exclusive of straight-lined revenues, amortization of prepaid rent, and straight-lined expenses.
(f)Includes all renewal terms at the Company's option.
(g)Based on diluted weighted-average common shares outstanding of 434 million and 433 million for the three months ended December 31, 2021 and 2020, respectively, and 434 million and 425 million for the twelve months ended December 31, 2021 and 2020, respectively.
(h)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for further information and reconciliation of non-GAAP financial measures to Income (loss) from continuing operations, as computed in accordance with GAAP.
(i)Attributable to CCIC common stockholders.
8
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| SUMMARY FINANCIAL HIGHLIGHTS (CONTINUED) | ||||||||||||||
| Twelve Months Ended December 31, | ||||||||||||||
| (in millions) | 2021 | 2020 | ||||||||||||
Summary Cash Flow Data:(a) | ||||||||||||||
| Net cash provided by (used for) operating activities | $ | 2,789 | $ | 3,055 | ||||||||||
Net cash provided by (used for) investing activities(b) | (1,332) | (1,741) | ||||||||||||
| Net cash provided by (used for) financing activities | (1,310) | (1,271) | ||||||||||||
| (in millions) | December 31, 2021 | December 31, 2020 | ||||||||||||
| Balance Sheet Data (at period end): | ||||||||||||||
| Cash and cash equivalents | $ | 292 | $ | 232 | ||||||||||
| Property and equipment, net | 15,269 | 15,162 | ||||||||||||
| Total assets | 39,040 | 38,768 | ||||||||||||
| Total debt and other long-term obligations | 20,629 | 19,280 | ||||||||||||
| Total CCIC stockholders' equity | 8,258 | 9,461 | ||||||||||||
| Three Months Ended December 31, 2021 | ||||||||
| Other Data: | ||||||||
Net debt to last quarter annualized Adjusted EBITDA(c) | 5.2 | x | ||||||
| Dividend per common share | $ | 1.47 | ||||||
| OUTLOOK FOR FULL YEAR 2022 | |||||||||||
| (in millions, except per share amounts) | Full Year 2022(d) | ||||||||||
| Site rental revenues | $6,202 | to | $6,247 | ||||||||
Site rental cost of operations(e) | $1,548 | to | $1,593 | ||||||||
| Income (loss) from continuing operations | $1,634 | to | $1,714 | ||||||||
Income (loss) from continuing operations per share—diluted(f)(g) | $3.76 | to | $3.94 | ||||||||
Adjusted EBITDA(h) | $4,249 | to | $4,294 | ||||||||
Interest expense and amortization of deferred financing costs(i) | $615 | to | $660 | ||||||||
FFO(g)(h) | $3,318 | to | $3,363 | ||||||||
AFFO(g)(h) | $3,178 | to | $3,223 | ||||||||
AFFO per share(f)(g)(h) | $7.31 | to | $7.41 | ||||||||
(a)Includes impacts of restricted cash. See the condensed consolidated statement of cash flows for further information.
(b)Includes net cash used for acquisitions of approximately $111 million and $107 million for the twelve months ended December 31, 2021 and 2020, respectively.
(c)See the "Net Debt to Last Quarter Annualized Adjusted EBITDA Calculation" in the Appendix.
(d)As issued on January 26, 2022.
(e)Exclusive of depreciation, amortization and accretion.
(f)The assumption for diluted weighted-average common shares outstanding for full year 2022 Outlook is based on the diluted common shares outstanding as of December 31, 2021.
(g)Attributable to CCIC common stockholders.
(h)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for further information and reconciliation of non-GAAP financial measures to Income (loss) from continuing operations, as computed in accordance with GAAP.
(i)See the reconciliation of "Components of Current Outlook for Interest Expense and Amortization of Deferred Financing Costs" in the Appendix.
9
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| FULL YEAR 2021 AND OUTLOOK FOR FULL YEAR 2022 COMPONENTS OF CHANGES IN SITE RENTAL REVENUES | |||||||||||||||||
| (dollars in millions) | Full Year 2021 Actual | Full Year 2022 Outlook(a) | |||||||||||||||
| Components of changes in site rental revenues: | |||||||||||||||||
Prior year site rental revenues exclusive of straight-lined revenues associated with fixed escalators(b)(c) | $5,298 | $5,608 | |||||||||||||||
New leasing activity(b)(c) | 384 | $325 | to | $355 | |||||||||||||
| Escalators | 93 | $95 | to | $105 | |||||||||||||
| Non-renewals | (170) | $(195) | to | $(175) | |||||||||||||
Organic Contribution to Site Rental Revenues(d) | 307 | $235 | to | $275 | |||||||||||||
| Impact from full year straight-lined revenues associated with fixed escalators | 111 | $359 | to | $379 | |||||||||||||
Acquisitions(e) | 3 | — | |||||||||||||||
| Other | — | — | |||||||||||||||
| Total GAAP site rental revenues | $5,719 | $6,202 | to | $6,247 | |||||||||||||
| Year-over-year changes in revenues: | |||||||||||||||||
| Reported GAAP site rental revenues | 7.5% | 8.8%(f) | |||||||||||||||
Organic Contribution to Site Rental Revenues(d)(g) | 5.8% | 4.5%(f) | |||||||||||||||
| NEW LEASING ACTIVITY BY SEGMENT | |||||||||||||||||||||||||||||||||||||||||||||||
| Full Year 2021 Actual | Full Year 2022 Outlook(a) | ||||||||||||||||||||||||||||||||||||||||||||||
| Towers | Fiber | Total | Towers | Fiber | Total | ||||||||||||||||||||||||||||||||||||||||||
| (in millions) | Small Cells | Fiber Solutions | Small Cells | Fiber Solutions | |||||||||||||||||||||||||||||||||||||||||||
New leasing activity(h) | $159 | $53 | $172 | $384 | $155-$165 | $20-$30 | $150-$160 | $325-$355 | |||||||||||||||||||||||||||||||||||||||
| Less: Year-over-year change in prepaid rent amortization | (20) | (19) | (3) | (42) | (5) | 5 | (5) | (5) | |||||||||||||||||||||||||||||||||||||||
Core leasing activity(h) | $139 | $34 | $169 | $342 | $150-$160 | $25-$35 | $145-$155 | $320-$350 | |||||||||||||||||||||||||||||||||||||||
(a)As issued on January 26, 2022.
(b)Includes revenues from amortization of prepaid rent in accordance with GAAP.
(c)Includes revenues from the construction of new small cell nodes, exclusive of straight-lined revenues related to fixed escalators.
(d)See "Non-GAAP Measures, Segment Measures and Other Calculations" for a discussion of our definition of Organic Contribution to Site Rental Revenues.
(e)Represents the contribution from recent acquisitions. The financial impact of recent acquisitions is excluded from Organic Contribution to Site Rental Revenues until the one-year anniversary of the acquisition.
(f)Calculated based on midpoint of full year 2022 Outlook.
(g)Calculated as the percentage change from prior year site rental revenues, exclusive of straight-lined revenues associated with fixed escalations, compared to Organic Contribution to Site Rental Revenues for the current period.
(h)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of new leasing activity and core leasing activity.
10
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) | |||||||||||
| (in millions, except par values) | December 31, 2021 | December 31, 2020 | |||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 292 | $ | 232 | |||||||
| Restricted cash | 169 | 144 | |||||||||
| Receivables, net | 543 | 431 | |||||||||
| Prepaid expenses | 105 | 95 | |||||||||
| Other current assets | 145 | 202 | |||||||||
| Total current assets | 1,254 | 1,104 | |||||||||
| Deferred site rental receivables | 1,588 | 1,408 | |||||||||
| Property and equipment, net | 15,269 | 15,162 | |||||||||
| Operating lease right-of-use assets | 6,682 | 6,464 | |||||||||
| Goodwill | 10,078 | 10,078 | |||||||||
| Other intangible assets, net | 4,046 | 4,433 | |||||||||
| Other assets, net | 123 | 119 | |||||||||
| Total assets | $ | 39,040 | $ | 38,768 | |||||||
| LIABILITIES AND EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 246 | $ | 230 | |||||||
| Accrued interest | 182 | 199 | |||||||||
| Deferred revenues | 776 | 704 | |||||||||
| Other accrued liabilities | 401 | 378 | |||||||||
| Current maturities of debt and other obligations | 72 | 129 | |||||||||
| Current portion of operating lease liabilities | 349 | 329 | |||||||||
| Total current liabilities | 2,026 | 1,969 | |||||||||
| Debt and other long-term obligations | 20,557 | 19,151 | |||||||||
| Operating lease liabilities | 6,031 | 5,808 | |||||||||
| Other long-term liabilities | 2,168 | 2,379 | |||||||||
| Total liabilities | 30,782 | 29,307 | |||||||||
| Commitments and contingencies | |||||||||||
| CCIC stockholders' equity: | |||||||||||
| Common stock, $0.01 par value; 600 shares authorized; shares issued and outstanding: December 31, 2021—432 and December 31, 2020—431 | 4 | 4 | |||||||||
| Additional paid-in capital | 18,011 | 17,933 | |||||||||
| Accumulated other comprehensive income (loss) | (4) | (4) | |||||||||
| Dividends/distributions in excess of earnings | (9,753) | (8,472) | |||||||||
| Total equity | 8,258 | 9,461 | |||||||||
| Total liabilities and equity | $ | 39,040 | $ | 38,768 | |||||||
11
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) | |||||||||||||||||||||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||||
| (in millions, except per share amounts) | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
| Net revenues: | |||||||||||||||||||||||
| Site rental | $ | 1,474 | $ | 1,352 | $ | 5,719 | $ | 5,320 | |||||||||||||||
| Services and other | 180 | 141 | 621 | 520 | |||||||||||||||||||
| Net revenues | 1,654 | 1,493 | 6,340 | 5,840 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
Costs of operations:(a) | |||||||||||||||||||||||
| Site rental | 387 | 401 | 1,554 | 1,521 | |||||||||||||||||||
| Services and other | 138 | 123 | 439 | 448 | |||||||||||||||||||
| Selling, general and administrative | 180 | 185 | 680 | 678 | |||||||||||||||||||
| Asset write-down charges | 12 | 64 | 21 | 74 | |||||||||||||||||||
| Acquisition and integration costs | — | 1 | 1 | 10 | |||||||||||||||||||
| Depreciation, amortization and accretion | 415 | 401 | 1,644 | 1,608 | |||||||||||||||||||
| Total operating expenses | 1,132 | 1,175 | 4,339 | 4,339 | |||||||||||||||||||
| Other operating (income) expense | — | (362) | — | (362) | |||||||||||||||||||
| Operating income (loss) | 522 | 680 | 2,001 | 1,863 | |||||||||||||||||||
| Interest expense and amortization of deferred financing costs | (164) | (167) | (657) | (689) | |||||||||||||||||||
| Gains (losses) on retirement of long-term obligations | — | — | (145) | (95) | |||||||||||||||||||
| Interest income | — | — | 1 | 2 | |||||||||||||||||||
| Other income (expense) | (4) | — | (21) | (5) | |||||||||||||||||||
| Income (loss) before income taxes | 354 | 513 | 1,179 | 1,076 | |||||||||||||||||||
| Benefit (provision) for income taxes | (1) | (5) | (21) | (20) | |||||||||||||||||||
| Income (loss) from continuing operations | 353 | 508 | 1,158 | 1,056 | |||||||||||||||||||
| Discontinued operations: | |||||||||||||||||||||||
| Net gain (loss) from disposal of discontinued operations, net of tax | — | — | (62) | — | |||||||||||||||||||
| Income (loss) from discontinued operations, net of tax | — | — | (62) | — | |||||||||||||||||||
| Net income (loss) | 353 | 508 | 1,096 | 1,056 | |||||||||||||||||||
| Dividends/distributions on preferred stock | — | — | — | (57) | |||||||||||||||||||
| Net income (loss) attributable to CCIC common stockholders | $ | 353 | $ | 508 | $ | 1,096 | $ | 999 | |||||||||||||||
| Net income (loss) attributable to CCIC common stockholders, per common share: | |||||||||||||||||||||||
| Income (loss) from continuing operations, basic | $ | 0.82 | $ | 1.17 | $ | 2.68 | $ | 2.36 | |||||||||||||||
| Income (loss) from discontinued operations, basic | — | — | (0.14) | — | |||||||||||||||||||
| Net income (loss) attributable to CCIC common stockholders, basic | $ | 0.82 | $ | 1.17 | $ | 2.54 | $ | 2.36 | |||||||||||||||
| Income (loss) from continuing operations, diluted | $ | 0.81 | $ | 1.17 | $ | 2.67 | $ | 2.35 | |||||||||||||||
| Income (loss) from discontinued operations, diluted | — | — | (0.14) | — | |||||||||||||||||||
| Net income (loss) attributable to CCIC common stockholders, diluted | $ | 0.81 | $ | 1.17 | $ | 2.53 | $ | 2.35 | |||||||||||||||
| Weighted-average common shares outstanding: | |||||||||||||||||||||||
| Basic | 432 | 431 | 432 | 423 | |||||||||||||||||||
| Diluted | 434 | 433 | 434 | 425 | |||||||||||||||||||
(a)Exclusive of depreciation, amortization and accretion shown separately.
12
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| SEGMENT OPERATING RESULTS | |||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended December 31, 2021 | Three Months Ended December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | Towers | Fiber | Other | Consolidated Total | Towers | Fiber | Other | Consolidated Total | |||||||||||||||||||||||||||||||||||||||
| Segment site rental revenues | $ | 985 | $ | 489 | $ | 1,474 | $ | 884 | $ | 468 | $ | 1,352 | |||||||||||||||||||||||||||||||||||
| Segment services and other revenues | 174 | 6 | 180 | 133 | 8 | 141 | |||||||||||||||||||||||||||||||||||||||||
| Segment revenues | 1,159 | 495 | 1,654 | 1,017 | 476 | 1,493 | |||||||||||||||||||||||||||||||||||||||||
| Segment site rental costs of operations | 231 | 148 | 379 | 218 | 173 | 391 | |||||||||||||||||||||||||||||||||||||||||
| Segment services and other costs of operations | 130 | 6 | 136 | 117 | 5 | 122 | |||||||||||||||||||||||||||||||||||||||||
Segment costs of operations(a)(b) | 361 | 154 | 515 | 335 | 178 | 513 | |||||||||||||||||||||||||||||||||||||||||
Segment site rental gross margin(c) | 754 | 341 | 1,095 | 666 | 295 | 961 | |||||||||||||||||||||||||||||||||||||||||
Segment services and other gross margin(c) | 44 | — | 44 | 16 | 3 | 19 | |||||||||||||||||||||||||||||||||||||||||
Segment selling, general and administrative expenses(b) | 29 | 41 | 70 | 30 | 49 | 79 | |||||||||||||||||||||||||||||||||||||||||
| Segment other operating (income) loss | — | — | — | — | (362) | (362) | |||||||||||||||||||||||||||||||||||||||||
Segment operating profit(c) | 769 | 300 | 1,069 | 652 | 611 | 1,263 | |||||||||||||||||||||||||||||||||||||||||
Other selling, general and administrative expenses(b) | $ | 85 | 85 | $ | 84 | 84 | |||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation expense | 31 | 31 | 28 | 28 | |||||||||||||||||||||||||||||||||||||||||||
| Depreciation, amortization and accretion | 415 | 415 | 401 | 401 | |||||||||||||||||||||||||||||||||||||||||||
| Interest expense and amortization of deferred financing costs | 164 | 164 | 167 | 167 | |||||||||||||||||||||||||||||||||||||||||||
Other (income) expenses to reconcile to income (loss) before income taxes(d) | 20 | 20 | 70 | 70 | |||||||||||||||||||||||||||||||||||||||||||
| Income (loss) before income taxes | $ | 354 | $ | 513 | |||||||||||||||||||||||||||||||||||||||||||
| FIBER SEGMENT SITE RENTAL REVENUES SUMMARY | |||||||||||||||||||||||||||||||||||
| Three Months Ended December 31, | |||||||||||||||||||||||||||||||||||
| 2021 | 2020 | ||||||||||||||||||||||||||||||||||
| (in millions) | Fiber Solutions | Small Cells | Total | Fiber Solutions | Small Cells | Total | |||||||||||||||||||||||||||||
| Site rental revenues | $ | 331 | $ | 158 | $ | 489 | $ | 325 | $ | 143 | $ | 468 | |||||||||||||||||||||||
(a)Exclusive of depreciation, amortization and accretion shown separately.
(b)Segment costs of operations excludes (1) stock-based compensation expense of $6 million in each of the three months ended December 31, 2021 and 2020 and (2) prepaid lease purchase price adjustments of $4 million and $5 million for the three months ended December 31, 2021 and 2020, respectively. Selling, general and administrative expenses exclude stock-based compensation expense of $25 million and $22 million for the three months ended December 31, 2021 and 2020, respectively.
(c)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of segment site rental gross margin, segment services and other gross margin and segment operating profit.
(d)See condensed consolidated statement of operations for further information.
13
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| SEGMENT OPERATING RESULTS | |||||||||||||||||||||||||||||||||||||||||||||||
| Twelve Months Ended December 31, 2021 | Twelve Months Ended December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | Towers | Fiber | Other | Consolidated Total | Towers | Fiber | Other | Consolidated Total | |||||||||||||||||||||||||||||||||||||||
| Segment site rental revenues | $ | 3,804 | $ | 1,915 | $ | 5,719 | $ | 3,497 | $ | 1,823 | $ | 5,320 | |||||||||||||||||||||||||||||||||||
| Segment services and other revenues | 601 | 20 | 621 | 500 | 20 | 520 | |||||||||||||||||||||||||||||||||||||||||
| Segment revenues | 4,405 | 1,935 | 6,340 | 3,997 | 1,843 | 5,840 | |||||||||||||||||||||||||||||||||||||||||
| Segment site rental costs of operations | 889 | 633 | 1,522 | 866 | 620 | 1,486 | |||||||||||||||||||||||||||||||||||||||||
| Segment services and other costs of operations | 414 | 17 | 431 | 429 | 12 | 441 | |||||||||||||||||||||||||||||||||||||||||
Segment costs of operations(a)(b) | 1,303 | 650 | 1,953 | 1,295 | 632 | 1,927 | |||||||||||||||||||||||||||||||||||||||||
Segment site rental gross margin(c) | 2,915 | 1,282 | 4,197 | 2,631 | 1,203 | 3,834 | |||||||||||||||||||||||||||||||||||||||||
Segment services and other gross margin(c) | 187 | 3 | 190 | 71 | 8 | 79 | |||||||||||||||||||||||||||||||||||||||||
Segment selling, general and administrative expenses(b) | 107 | 174 | 281 | 100 | 186 | 286 | |||||||||||||||||||||||||||||||||||||||||
| Segment other operating (income) loss | — | — | — | — | (362) | (362) | |||||||||||||||||||||||||||||||||||||||||
Segment operating profit(c) | 2,995 | 1,111 | 4,106 | 2,602 | 1,387 | 3,989 | |||||||||||||||||||||||||||||||||||||||||
Other selling, general and administrative expenses(b) | $ | 290 | 290 | $ | 283 | 283 | |||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation expense | 131 | 131 | 133 | 133 | |||||||||||||||||||||||||||||||||||||||||||
Depreciation, amortization and accretion | 1,644 | 1,644 | 1,608 | 1,608 | |||||||||||||||||||||||||||||||||||||||||||
Interest expense and amortization of deferred financing costs | 657 | 657 | 689 | 689 | |||||||||||||||||||||||||||||||||||||||||||
Other (income) expenses to reconcile to income (loss) before income taxes(d) | 205 | 205 | 200 | 200 | |||||||||||||||||||||||||||||||||||||||||||
Income (loss) before income taxes | $ | 1,179 | $ | 1,076 | |||||||||||||||||||||||||||||||||||||||||||
| FIBER SEGMENT SITE RENTAL REVENUES SUMMARY | |||||||||||||||||||||||||||||||||||
| Twelve Months Ended December 31, | |||||||||||||||||||||||||||||||||||
| 2021 | 2020 | ||||||||||||||||||||||||||||||||||
| (in millions) | Fiber Solutions | Small Cells | Total | Fiber Solutions | Small Cells | Total | |||||||||||||||||||||||||||||
| Site rental revenues | $ | 1,318 | $ | 597 | $ | 1,915 | $ | 1,275 | $ | 548 | $ | 1,823 | |||||||||||||||||||||||
(a)Exclusive of depreciation, amortization and accretion shown separately.
(b)Segment costs of operations excludes (1) stock-based compensation expense of $22 million and $24 million for the twelve months ended December 31, 2021 and 2020, respectively and (2) prepaid lease purchase price adjustments of $18 million in each of the twelve months ended December 31, 2021 and 2020. Selling, general and administrative expenses exclude stock-based compensation expense of $109 million in each of the twelve months ended December 31, 2021 and 2020.
(c)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of segment site rental gross margin, segment services and other gross margin and segment operating profit.
(d)See condensed consolidated statement of operations for further information.
14
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| FFO AND AFFO RECONCILIATIONS | |||||||||||||||||||||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||||
| (in millions, except per share amounts) | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
| Income (loss) from continuing operations | $ | 353 | $ | 508 | $ | 1,158 | (a) | $ | 1,056 | ||||||||||||||
| Real estate related depreciation, amortization and accretion | 402 | 388 | 1,593 | 1,555 | |||||||||||||||||||
| Asset write-down charges | 12 | 64 | 21 | 74 | |||||||||||||||||||
| Dividends/distributions on preferred stock | — | — | — | (85) | |||||||||||||||||||
FFO(b)(c)(d)(e) | $ | 767 | $ | 960 | $ | 2,772 | $ | 2,600 | |||||||||||||||
| Weighted-average common shares outstanding—diluted | 434 | 433 | 434 | 425 | |||||||||||||||||||
FFO per share(b)(c)(d)(e) | $ | 1.77 | $ | 2.22 | $ | 6.39 | $ | 6.12 | |||||||||||||||
| FFO (from above) | $ | 767 | $ | 960 | $ | 2,772 | $ | 2,600 | |||||||||||||||
| Adjustments to increase (decrease) FFO: | |||||||||||||||||||||||
| Straight-lined revenue | (38) | 5 | (111) | (22) | |||||||||||||||||||
| Straight-lined expense | 18 | 22 | 76 | 83 | |||||||||||||||||||
| Stock-based compensation expense | 31 | 28 | 131 | 133 | |||||||||||||||||||
| Non-cash portion of tax provision | (1) | (1) | 1 | 1 | |||||||||||||||||||
| Non-real estate related depreciation, amortization and accretion | 13 | 13 | 51 | 53 | |||||||||||||||||||
| Amortization of non-cash interest expense | 4 | 1 | 13 | 6 | |||||||||||||||||||
| Other (income) expense | 4 | — | 21 | 5 | |||||||||||||||||||
| (Gains) losses on retirement of long-term obligations | — | — | 145 | 95 | |||||||||||||||||||
| Acquisition and integration costs | — | 1 | 1 | 10 | |||||||||||||||||||
| Sustaining capital expenditures | (30) | (21) | (87) | (86) | |||||||||||||||||||
AFFO(b)(c)(d)(e) | $ | 768 | $ | 1,008 | $ | 3,013 | $ | 2,878 | |||||||||||||||
| Weighted-average common shares outstanding—diluted | 434 | 433 | 434 | 425 | |||||||||||||||||||
AFFO per share(b)(c)(d)(e) | $ | 1.77 | $ | 2.33 | $ | 6.95 | $ | 6.78 | |||||||||||||||
(a)Does not reflect the impact related to the ATO Settlement (as defined in the Form 8-K filed with the Securities and Exchange Commission on April 26, 2021 ("April 8-K"), which is attributable to discontinued operations as discussed in the April 8-K.
(b)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of FFO and AFFO, including per share amounts.
(c)FFO and AFFO are reduced by cash paid for preferred stock dividends during the period in which they are paid.
(d)Attributable to CCIC common stockholders.
(e)The above reconciliation excludes line items included in our definition which are not applicable for the periods shown.
15
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) | ||||||||||||||||||||||||||
| Twelve Months Ended December 31, | ||||||||||||||||||||||||||
| (in millions) | 2021 | 2020 | ||||||||||||||||||||||||
| Cash flows from operating activities: | ||||||||||||||||||||||||||
| Income (loss) from continuing operations | $ | 1,158 | $ | 1,056 | ||||||||||||||||||||||
| Adjustments to reconcile Income (loss) from continuing operations to net cash provided by (used for) operating activities: | ||||||||||||||||||||||||||
| Depreciation, amortization and accretion | 1,644 | 1,608 | ||||||||||||||||||||||||
| (Gains) losses on retirement of long-term obligations | 145 | 95 | ||||||||||||||||||||||||
| Amortization of deferred financing costs and other non-cash interest, net | 13 | 6 | ||||||||||||||||||||||||
| Stock-based compensation expense | 129 | 138 | ||||||||||||||||||||||||
| Asset write-down charges | 21 | 74 | ||||||||||||||||||||||||
| Deferred income tax (benefit) provision | 4 | 3 | ||||||||||||||||||||||||
| Other non-cash adjustments, net | 21 | 5 | ||||||||||||||||||||||||
| Changes in assets and liabilities, excluding the effects of acquisitions: | ||||||||||||||||||||||||||
| Increase (decrease) in liabilities | (120) | (111) | ||||||||||||||||||||||||
| Decrease (increase) in assets | (226) | 181 | ||||||||||||||||||||||||
| Net cash provided by (used for) operating activities | 2,789 | 3,055 | ||||||||||||||||||||||||
| Cash flows from investing activities: | ||||||||||||||||||||||||||
| Capital expenditures | (1,229) | (1,624) | ||||||||||||||||||||||||
| Payments for acquisitions, net of cash acquired | (111) | (107) | ||||||||||||||||||||||||
| Other investing activities, net | 8 | (10) | ||||||||||||||||||||||||
| Net cash provided by (used for) investing activities | (1,332) | (1,741) | ||||||||||||||||||||||||
| Cash flows from financing activities: | ||||||||||||||||||||||||||
| Proceeds from issuance of long-term debt | 3,985 | 3,733 | ||||||||||||||||||||||||
| Principal payments on debt and other long-term obligations | (1,076) | (105) | ||||||||||||||||||||||||
| Purchases and redemptions of long-term debt | (2,089) | (2,490) | ||||||||||||||||||||||||
| Borrowings under revolving credit facility | 1,245 | 2,430 | ||||||||||||||||||||||||
| Payments under revolving credit facility | (870) | (2,665) | ||||||||||||||||||||||||
| Net borrowings (repayments) under commercial paper program | (20) | 130 | ||||||||||||||||||||||||
| Payments for financing costs | (42) | (38) | ||||||||||||||||||||||||
| Purchases of common stock | (70) | (76) | ||||||||||||||||||||||||
| Dividends/distributions paid on common stock | (2,373) | (2,105) | ||||||||||||||||||||||||
| Dividends/distributions paid on preferred stock | — | (85) | ||||||||||||||||||||||||
| Net cash provided by (used for) financing activities | (1,310) | (1,271) | ||||||||||||||||||||||||
| Net increase (decrease) in cash, cash equivalents, and restricted cash - continuing operations | 147 | 43 | ||||||||||||||||||||||||
| Discontinued operations: | ||||||||||||||||||||||||||
| Net cash provided by (used for) operating activities | (62) | — | ||||||||||||||||||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash - discontinued operations | (62) | — | ||||||||||||||||||||||||
| Effect of exchange rate changes on cash | — | — | ||||||||||||||||||||||||
| Cash, cash equivalents, and restricted cash at beginning of period | 381 | 338 | ||||||||||||||||||||||||
| Cash, cash equivalents, and restricted cash at end of period | $ | 466 | $ | 381 | ||||||||||||||||||||||
| Supplemental disclosure of cash flow information: | ||||||||||||||||||||||||||
| Interest paid | 661 | 653 | ||||||||||||||||||||||||
| Income taxes paid | 20 | 19 | ||||||||||||||||||||||||
16
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| COMPONENTS OF CHANGES IN SITE RENTAL REVENUES | |||||||||||
| Three Months Ended December 31, | |||||||||||
| (dollars in millions) | 2021 | 2020 | |||||||||
| Components of changes in site rental revenues: | |||||||||||
Prior year site rental revenues exclusive of straight-lined revenues associated with fixed escalators(a)(b) | $ | 1,357 | $ | 1,282 | |||||||
New leasing activity(a)(b) | 98 | 90 | |||||||||
| Escalators | 24 | 23 | |||||||||
| Non-renewals | (43) | (39) | |||||||||
Organic Contribution to Site Rental Revenues(c) | 79 | 74 | |||||||||
| Impact from straight-lined revenues associated with fixed escalators | 38 | (5) | |||||||||
Acquisitions(d) | — | 1 | |||||||||
| Other | — | — | |||||||||
| Total GAAP site rental revenues | $ | 1,474 | $ | 1,352 | |||||||
| Year-over-year changes in revenue: | |||||||||||
| Reported GAAP site rental revenues | 9.0 | % | |||||||||
Organic Contribution to Site Rental Revenues(c)(e) | 5.8 | % | |||||||||
SUMMARY OF SITE RENTAL STRAIGHT-LINED REVENUES AND EXPENSES ASSOCIATED WITH FIXED ESCALATORS(f) | |||||||||||||||||||||||||||||||||||
| Three Months Ended December 31, | |||||||||||||||||||||||||||||||||||
| 2021 | 2020 | ||||||||||||||||||||||||||||||||||
| (in millions) | Towers | Fiber | Total | Towers | Fiber | Total | |||||||||||||||||||||||||||||
| Site rental straight-lined revenues | $ | 39 | $ | (1) | $ | 38 | $ | (6) | $ | 1 | $ | (5) | |||||||||||||||||||||||
| Site rental straight-lined expenses | 18 | — | 18 | 22 | — | 22 | |||||||||||||||||||||||||||||
| Twelve Months Ended December 31, | |||||||||||||||||||||||||||||||||||
| 2021 | 2020 | ||||||||||||||||||||||||||||||||||
| (in millions) | Towers | Fiber | Total | Towers | Fiber | Total | |||||||||||||||||||||||||||||
| Site rental straight-lined revenues | $ | 110 | $ | 1 | $ | 111 | $ | 16 | $ | 6 | $ | 22 | |||||||||||||||||||||||
| Site rental straight-lined expenses | 75 | 1 | 76 | 82 | 1 | 83 | |||||||||||||||||||||||||||||
(a)Includes revenues from amortization of prepaid rent in accordance with GAAP.
(b)Includes revenues from the construction of new small cell nodes, exclusive of straight-lined revenues related to fixed escalators.
(c)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definition of Organic Contribution to Site Rental Revenues.
(d)Represents the contribution from recent acquisitions. The financial impact of recent acquisitions is excluded from Organic Contribution to Site Rental Revenues until the one-year anniversary of the acquisition.
(e)Calculated as the percentage change from prior year site rental revenues, exclusive of straight-lined revenues associated with fixed escalations, compared to Organic Contribution to Site Rental Revenues for the current period.
(f)In accordance with GAAP accounting, if payment terms call for fixed escalations or rent free periods, the revenue is recognized on a straight-line basis over the fixed, non-cancelable term of the contract. Since the Company recognizes revenue on a straight-line basis, a portion of the site rental revenue in a given period represents cash collected or contractually collectible in other periods.
17
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
SUMMARY OF PREPAID RENT ACTIVITY(a) | |||||||||||||||||||||||||||||||||||
| Three Months Ended December 31, | |||||||||||||||||||||||||||||||||||
| 2021 | 2020 | ||||||||||||||||||||||||||||||||||
| (in millions) | Towers | Fiber | Total | Towers | Fiber | Total | |||||||||||||||||||||||||||||
| Prepaid rent additions | $ | 26 | $ | 107 | $ | 133 | $ | 26 | $ | 57 | $ | 83 | |||||||||||||||||||||||
| Amortization of prepaid rent | 80 | 66 | 146 | 76 | 57 | 133 | |||||||||||||||||||||||||||||
| Twelve Months Ended December 31, | |||||||||||||||||||||||||||||||||||
| 2021 | 2020 | ||||||||||||||||||||||||||||||||||
| (in millions) | Towers | Fiber | Total | Towers | Fiber | Total | |||||||||||||||||||||||||||||
| Prepaid rent additions | $ | 105 | $ | 290 | $ | 395 | $ | 193 | $ | 242 | $ | 435 | |||||||||||||||||||||||
| Amortization of prepaid rent | 318 | 242 | 560 | 298 | 221 | 519 | |||||||||||||||||||||||||||||
| SUMMARY OF CAPITAL EXPENDITURES | |||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||||
| 2021 | 2020 | ||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | Towers | Fiber | Other | Total | Towers | Fiber | Other | Total | |||||||||||||||||||||||||||||||||||||||
| Discretionary: | |||||||||||||||||||||||||||||||||||||||||||||||
| Purchases of land interests | $ | 19 | $ | 2 | $ | — | $ | 21 | $ | 23 | $ | — | $ | — | $ | 23 | |||||||||||||||||||||||||||||||
| Communications infrastructure improvements and other capital projects | 34 | 239 | 13 | 286 | 38 | 292 | 12 | 342 | |||||||||||||||||||||||||||||||||||||||
| Sustaining | 8 | 14 | 8 | 30 | 3 | 14 | 4 | 21 | |||||||||||||||||||||||||||||||||||||||
| Total | $ | 61 | $ | 255 | $ | 21 | $ | 337 | $ | 64 | $ | 306 | $ | 16 | $ | 386 | |||||||||||||||||||||||||||||||
| Twelve Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||||
| 2021 | 2020 | ||||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | Towers | Fiber | Other | Total | Towers | Fiber | Other | Total | |||||||||||||||||||||||||||||||||||||||
| Discretionary: | |||||||||||||||||||||||||||||||||||||||||||||||
| Purchases of land interests | $ | 64 | $ | 2 | $ | — | $ | 66 | $ | 64 | $ | — | $ | — | $ | 64 | |||||||||||||||||||||||||||||||
| Communications infrastructure improvements and other capital projects | 138 | 905 | 33 | 1,076 | 257 | 1,179 | 38 | 1,474 | |||||||||||||||||||||||||||||||||||||||
| Sustaining | 19 | 49 | 19 | 87 | 14 | 53 | 19 | 86 | |||||||||||||||||||||||||||||||||||||||
| Total | $ | 221 | $ | 956 | $ | 52 | $ | 1,229 | $ | 335 | $ | 1,232 | $ | 57 | $ | 1,624 | |||||||||||||||||||||||||||||||
PROJECTED REVENUES FROM TENANT CONTRACTS(b)(c) | |||||||||||||||||
| Years Ending December 31, | |||||||||||||||||
| (as of December 31, 2021; in millions) | 2022 | 2023 | 2024 | 2025 | 2026 | ||||||||||||
| Components of site rental revenues: | |||||||||||||||||
| Site rental revenues exclusive of straight-line associated with fixed escalators | $ | 5,765 | $ | 5,839 | $ | 5,850 | $ | 5,920 | $ | 6,000 | |||||||
| Straight-lined site rental revenues associated with fixed escalators | 67 | (18) | (71) | (169) | (242) | ||||||||||||
| GAAP site rental revenues | $ | 5,832 | $ | 5,821 | $ | 5,779 | $ | 5,751 | $ | 5,758 | |||||||
(a)Reflects up-front consideration from long-term tenants and other deferred credits (commonly referred to as prepaid rent), and the amortization thereof for GAAP revenue recognition purposes.
(b)Based on tenant licenses in-place as of December 31, 2021. All tenant licenses are assumed to renew for a new term no later than the respective current term end date, and as such, projected revenues do not reflect the impact of estimated annual churn. CPI-linked tenant contracts are assumed to escalate at 3% per annum.
(c)Excludes the impact of the Company’s long-term agreement with T-Mobile, effective January 1, 2022, as further described in the January 8-K, which will be reflected beginning with the Company’s first quarter 2022 Supplement.
18
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
PROJECTED EXPENSES FROM EXISTING GROUND LEASES AND FIBER ACCESS AGREEMENTS(a) | |||||||||||||||||
| Years Ending December 31, | |||||||||||||||||
| (as of December 31, 2021; in millions) | 2022 | 2023 | 2024 | 2025 | 2026 | ||||||||||||
| Components of ground lease and fiber access agreement expenses: | |||||||||||||||||
| Ground lease and fiber access agreement expenses exclusive of straight-line associated with fixed escalators | $ | 944 | $ | 963 | $ | 982 | $ | 1,001 | $ | 1,022 | |||||||
| Straight-lined site rental lease expenses associated with fixed escalators | 65 | 52 | 41 | 30 | 18 | ||||||||||||
| GAAP ground lease and fiber access agreement expenses | $ | 1,009 | $ | 1,015 | $ | 1,023 | $ | 1,031 | $ | 1,040 | |||||||
ANNUALIZED RENTAL CASH PAYMENTS AT TIME OF RENEWAL(b) | |||||||||||||||||
| Years Ending December 31, | |||||||||||||||||
| (as of December 31, 2021; in millions) | 2022 | 2023 | 2024 | 2025 | 2026 | ||||||||||||
T-Mobile(c) | $ | 324 | $ | 260 | $ | 71 | $ | 83 | $ | 78 | |||||||
| AT&T | 27 | 330 | 18 | 20 | 32 | ||||||||||||
| Verizon | 17 | 16 | 20 | 30 | 36 | ||||||||||||
| All Others Combined | 214 | 211 | 166 | 90 | 98 | ||||||||||||
| Total | $ | 582 | $ | 817 | $ | 275 | $ | 223 | $ | 244 | |||||||
| CONSOLIDATED TENANT OVERVIEW | |||||||||||
| (as of December 31, 2021) | Percentage of Q4 2021 LQA Site Rental Revenues | Weighted Average Current Term Remaining(d) | Long-Term Credit Rating (S&P / Moody’s) | ||||||||
| T-Mobile | 33% | 5(c) | BB+ / Ba1 | ||||||||
| AT&T | 20% | 5 | BBB / Baa2 | ||||||||
| Verizon | 21% | 9 | BBB+ / Baa1 | ||||||||
| All Others Combined | 26% | 3 | N/A | ||||||||
| Total / Weighted Average | 100% | 5 | |||||||||
| FIBER SOLUTIONS REVENUE MIX | |||||
| (as of December 31, 2021) | Percentage of Q4 2021 LQA Site Rental Revenues | ||||
Carrier(e) | 38% | ||||
| Education | 13% | ||||
| Healthcare | 11% | ||||
| Financial Services | 9% | ||||
| Other | 29% | ||||
| Total | 100% | ||||
(a)Based on existing ground leases and fiber access agreements as of December 31, 2021. CPI-linked leases are assumed to escalate at 3% per annum.
(b)Reflects lease renewals by year by tenant; dollar amounts represent annualized cash site rental revenues from assumed renewals or extensions as reflected in the table "Projected Revenues from Tenant Contracts."
(c)Excludes the impact of the Company’s long-term agreement with T-Mobile, effective January 1, 2022, as further described in the January 8-K, which will be reflected beginning with the Company’s first quarter 2022 Supplement.
(d)Weighted by site rental revenue revenues; excludes renewals at the tenants' option.
(e)Includes revenues derived from both wireless carriers and wholesale carriers.
19
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
SEGMENT CASH YIELDS ON INVESTED CAPITAL(a) | |||||||||||
| Q4 2021 LQA | |||||||||||
| (as of December 31, 2021; dollars in millions) | Towers | Fiber | |||||||||
Segment site rental gross margin(b) | $ | 3,016 | $ | 1,364 | |||||||
| Less: Amortization of prepaid rent | (320) | (264) | |||||||||
| Less: Site rental straight-lined revenues | (156) | 4 | |||||||||
| Add: Site rental straight-lined expenses | 72 | — | |||||||||
Add: Indirect labor costs(c) | — | 109 | |||||||||
| Numerator | $ | 2,612 | $ | 1,213 | |||||||
Segment net investment in property and equipment(d) | $ | 13,127 | $ | 8,020 | |||||||
| Segment investment in site rental contracts and tenant relationships | 4,567 | 3,287 | |||||||||
Segment investment in goodwill(e) | 5,351 | 4,073 | |||||||||
Segment net invested capital(a) | $ | 23,045 | $ | 15,380 | |||||||
Segment Cash Yield on Invested Capital(a) | 11.3 | % | 7.9 | % | |||||||
CONSOLIDATED RETURN ON INVESTED CAPITAL(a) | |||||
| (as of December 31, 2021; dollars in millions) | Q4 2021 LQA | ||||
Adjusted EBITDA(f) | $ | 3,936 | |||
| Cash taxes refunded (paid) | (10) | ||||
| Numerator | $ | 3,926 | |||
Historical gross investment in property and equipment(g) | $ | 26,267 | |||
| Historical gross investment in site rental contracts and tenant relationships | 7,854 | ||||
| Historical gross investment in goodwill | 10,078 | ||||
Consolidated invested capital(a) | $ | 44,199 | |||
Consolidated Return on Invested Capital(a) | 8.9 | % | |||
(a)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for further information on, and definition and our calculation of segment cash yields on invested capital, segment net invested capital, consolidated return on invested capital and consolidated invested capital.
(b)See "Segment Operating Results" and "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for further information on, and definition and our calculation of segment site rental gross margin.
(c)This adjustment represents indirect labor costs in the Fiber segment that are not capitalized, but that primarily support the Company's ongoing expansion of its small cells and fiber networks that management expects to generate future revenues for the Company. Removal of these indirect labor costs presents segment cash yield on invested capital on a direct cost basis, consistent with the methodology used by management when evaluating project-level investment opportunities.
(d)Segment investment in property and equipment excludes the impact of construction in process and non-productive assets (such as information technology assets and buildings) and is reduced by the amount of prepaid rent received from customers (excluding any deferred credits recorded in connection with acquisitions).
(e)Segment investment in goodwill excludes the impact of certain assets and liabilities recorded in connection with acquisitions (primarily deferred credits).
(f)See "Reconciliations of Non-GAAP Financial Measures to Comparable GAAP Financial Measures and Other Calculations" for further information and reconciliation of this non-GAAP financial measure to net income (loss). See also "Non-GAAP Financial Measures, Segment Measures and Other Calculations" in the Appendix for our definition of Adjusted EBITDA.
(g)Historical gross investment in property and equipment excludes the impact of construction in process.
20
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
SUMMARY OF TOWER PORTFOLIO BY VINTAGE(a) | |||||
| (as of December 31, 2021; dollars in thousands) | |||||
CASH YIELD(b) | NUMBER OF TENANTS PER TOWER | ||||
LQA CASH SITE RENTAL REVENUE PER TOWER(c) | LQA TOWERS SEGMENT SITE RENTAL GROSS CASH MARGIN PER TOWER(d) | ||||
NET INVESTED CAPITAL PER TOWER(e) | NUMBER OF TOWERS | ||||
(a)All tower portfolio figures are calculated exclusively for the Company’s towers and rooftops and do not give effect to other activities within the Company’s Towers segment.
(b)Cash yield is calculated as LQA Towers segment site rental gross margin, exclusive of straight-lined revenues and amortization of prepaid rent, divided by invested capital net of the amount of prepaid rent received from customers.
(c)Exclusive of straight-lined revenues and amortization of prepaid rent.
(d)Exclusive of straight-lined revenues, amortization of prepaid rent, and straight-lined expenses.
(e)Reflects gross total assets (including incremental capital invested by the Company since time of acquisition or construction completion), less any prepaid rent. Inclusive of invested capital related to land at the tower site.
21
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
TOWER PORTFOLIO OVERVIEW(a) | ||||||||
| (as of December 31, 2021; dollars in thousands) | ||||||||
| NUMBER OF TOWERS | TENANTS PER TOWER | LQA CASH SITE RENTAL REVENUE PER TOWER(b) | ||||||
(a) All tower portfolio figures are calculated exclusively for the Company’s towers and rooftops and do not give effect to other activities within the Company’s Towers segment.
(b) Exclusive of straight-lined revenues and amortization of prepaid rent.
22
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
DISTRIBUTION OF TOWER TENANCY (as of December 31, 2021)(a) | |||||||||||||||||
| PERCENTAGE OF TOWERS BY TENANTS PER TOWER | |||||||||||||||||
| SITES ACQUIRED AND BUILT 2006 AND PRIOR | SITES ACQUIRED AND BUILT 2007 TO PRESENT | ||||||||||||||||
| Average: 2.8 | Average: 2.1 | ||||
GEOGRAPHIC TOWER DISTRIBUTION (as of December 31, 2021)(a) | |||||
| PERCENTAGE OF TOWERS BY GEOGRAPHIC LOCATION | PERCENTAGE OF LQA CASH SITE RENTAL REVENUE BY GEOGRAPHIC LOCATION(b) | ||||
(a) All tower portfolio figures are calculated exclusively for the Company’s towers and rooftops and do not give effect to other activities within the Company’s Towers segment.
(b) Exclusive of straight-lined revenues and amortization of prepaid rent.
23
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
| GROUND INTEREST OVERVIEW | |||||||||||||||||||||||
| (as of December 31, 2021; dollars in millions) | LQA Cash Site Rental Revenues(a) | Percentage of LQA Cash Site Rental Revenues(a) | LQA Towers Segment Site Rental Gross Cash Margin(b) | Percentage of LQA Towers Segment Site Rental Gross Cash Margin(b) | Number of Towers(c) | Percentage of Towers | Weighted Average Term Remaining (by years)(d) | ||||||||||||||||
| Less than 10 years | $ | 369 | 11 | % | $ | 195 | 7 | % | 5,347 | 13 | % | ||||||||||||
| 10 to 20 years | 461 | 13 | % | 276 | 11 | % | 5,951 | 15 | % | ||||||||||||||
| Greater than 20 years | 1,483 | 43 | % | 1,067 | 41 | % | 17,647 | 44 | % | ||||||||||||||
| Total leased | $ | 2,313 | 67 | % | $ | 1,538 | 59 | % | 28,945 | 72 | % | 36 | |||||||||||
| Owned | $ | 1,146 | 33 | % | $ | 1,063 | 41 | % | 11,214 | 28 | % | ||||||||||||
| Total / Average | $ | 3,459 | 100 | % | $ | 2,601 | 100 | % | 40,159 | 100 | % | ||||||||||||
| GROUND INTEREST ACTIVITY | |||||||||||
| (dollars in millions) | Three Months Ended December 31, 2021 | Twelve Months Ended December 31, 2021 | |||||||||
| Ground Extensions Under Crown Castle Towers: | |||||||||||
| Number of ground leases extended | 161 | 654 | |||||||||
| Average number of years extended | 28 | 30 | |||||||||
Percentage increase in consolidated cash ground lease expense due to extension activities(e) | 0.1 | % | 0.1 | % | |||||||
| Ground Purchases Under Crown Castle Towers: | |||||||||||
| Number of ground leases purchased | 49 | 200 | |||||||||
| Ground lease purchases (including capital expenditures, acquisitions and installment purchases) | $ | 43 | $ | 106 | |||||||
| Percentage of Towers segment site rental gross margin from towers on purchased land | <1% | <1% | |||||||||
(a)Exclusive of straight-lined revenues and amortization of prepaid rent.
(b)Exclusive of straight-lined revenues, amortization of prepaid rent, and straight-lined expenses.
(c)Excludes small cells, fiber and third-party land interests.
(d)Includes all renewal terms at the Company's option; weighted by Towers segment site rental gross margin exclusive of straight-lined revenues, amortization of prepaid rent, and straight-lined expenses.
(e)Includes the impact from the amortization of lump sum payments.
24
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
CAPITALIZATION OVERVIEW | |||||||||||||||||
| (as of December 31, 2021; dollars in millions) | Face Value | Fixed vs. Variable | Interest Rate(a) | Net Debt to LQA Adjusted EBITDA(b) | Maturity | ||||||||||||
| Cash, cash equivalents and restricted cash | $ | 466 | |||||||||||||||
3.849% Secured Notes | 1,000 | Fixed | 3.9% | 2023 | |||||||||||||
Senior Secured Notes, Series 2009-1, Class A-2(c) | 54 | Fixed | 9.0% | 2029 | |||||||||||||
Senior Secured Tower Revenue Notes, Series 2018-1(d) | 250 | Fixed | 3.7% | 2043 | |||||||||||||
Senior Secured Tower Revenue Notes, Series 2015-2(d) | 700 | Fixed | 3.7% | 2045 | |||||||||||||
Senior Secured Tower Revenue Notes, Series 2018-2(d) | 750 | Fixed | 4.2% | 2048 | |||||||||||||
| Finance leases and other obligations | 242 | Various | Various | Various | |||||||||||||
| Total secured debt | $ | 2,996 | 4.0% | 0.8x | |||||||||||||
2016 Revolver(e) | 665 | Variable | 1.2% | 2026 | |||||||||||||
| 2016 Term Loan A | 1,223 | Variable | 1.2% | 2026 | |||||||||||||
Commercial Paper Notes(f) | 265 | Variable | 0.5% | 2022 | |||||||||||||
| 3.150% Senior Notes | 750 | Fixed | 3.2% | 2023 | |||||||||||||
| 3.200% Senior Notes | 750 | Fixed | 3.2% | 2024 | |||||||||||||
| 1.350% Senior Notes | 500 | Fixed | 1.4% | 2025 | |||||||||||||
| 4.450% Senior Notes | 900 | Fixed | 4.5% | 2026 | |||||||||||||
| 3.700% Senior Notes | 750 | Fixed | 3.7% | 2026 | |||||||||||||
| 1.050% Senior Notes | 1,000 | Fixed | 1.1% | 2026 | |||||||||||||
| 4.000% Senior Notes | 500 | Fixed | 4.0% | 2027 | |||||||||||||
| 3.650% Senior Notes | 1,000 | Fixed | 3.7% | 2027 | |||||||||||||
| 3.800% Senior Notes | 1,000 | Fixed | 3.8% | 2028 | |||||||||||||
| 4.300% Senior Notes | 600 | Fixed | 4.3% | 2029 | |||||||||||||
| 3.100% Senior Notes | 550 | Fixed | 3.1% | 2029 | |||||||||||||
| 3.300% Senior Notes | 750 | Fixed | 3.3% | 2030 | |||||||||||||
| 2.250% Senior Notes | 1,100 | Fixed | 2.3% | 2031 | |||||||||||||
| 2.100% Senior Notes | 1,000 | Fixed | 2.1% | 2031 | |||||||||||||
| 2.500% Senior Notes | 750 | Fixed | 2.5% | 2031 | |||||||||||||
| 2.900% Senior Notes | 1,250 | Fixed | 2.9% | 2041 | |||||||||||||
| 4.750% Senior Notes | 350 | Fixed | 4.8% | 2047 | |||||||||||||
| 5.200% Senior Notes | 400 | Fixed | 5.2% | 2049 | |||||||||||||
| 4.000% Senior Notes | 350 | Fixed | 4.0% | 2049 | |||||||||||||
| 4.150% Senior Notes | 500 | Fixed | 4.2% | 2050 | |||||||||||||
| 3.250% Senior Notes | 900 | Fixed | 3.3% | 2051 | |||||||||||||
| Total unsecured debt | $ | 17,803 | 2.9% | 4.5x | |||||||||||||
| Total net debt | $ | 20,333 | 3.1% | 5.2x | |||||||||||||
Market Capitalization(g) | 90,220 | ||||||||||||||||
Firm Value(h) | $ | 110,553 | |||||||||||||||
(a)Represents the weighted-average stated interest rate, as applicable.
(b)Represents the applicable amount of debt divided by LQA consolidated Adjusted EBITDA. See the "Net Debt to Last Quarter Annualized Adjusted EBITDA Calculation" in the Appendix.
(c)The Senior Secured Notes, 2009-1, Class A-2 principal amortizes over a period ending in August 2029.
(d)If the respective series of such debt is not paid in full on or prior to an applicable anticipated repayment date, then the 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 additional interest (of an additional approximately 5% per annum) will accrue on the respective series. The Senior Secured Tower Revenue Notes 2015-2 have an anticipated repayment date in 2025. The Senior Secured Tower Revenue Notes, 2018-1 and 2018-2 have anticipated repayment dates in 2023 and 2028, respectively. Notes are prepayable at par if voluntarily repaid within certain repayment windows (typically twelve to eighteen months or less prior to maturity); earlier prepayment may require additional consideration.
(e)As of December 31, 2021, the undrawn availability under the $5.0 billion 2016 Revolver was $4.3 billion.
(f)As of December 31, 2021, the Company had $735 million available for issuance under the $1.0 billion unsecured commercial paper program ("CP Program"). The maturities of the Commercial Paper Notes, when outstanding, may vary but may not exceed 397 days from the date of issue.
(g)Market capitalization calculated based on $208.74 closing price and 432 million shares outstanding as of December 31, 2021.
(h)Represents the sum of net debt and market capitalization.
25
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
DEBT MATURITY OVERVIEW(a)(b) | ||
(as of December 31, 2021; dollars in millions)
(a)Where applicable, maturities reflect the Anticipated Repayment Date, as defined in the respective debt agreement; excludes finance leases and other obligations; amounts presented at face value, net of repurchases held at CCIC.
(b)The $265 million outstanding in commercial paper notes ("CP Notes") have been excluded from this table. Amounts available under the CP Program may be borrowed, repaid and re-borrowed from time to time. We intend to maintain available commitments under our 2016 Revolver in an amount at least equal to the amount of CP Notes outstanding at any point in time.
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LIQUIDITY OVERVIEW(a) | |||||
| (in millions) | December 31, 2021 | ||||
Cash, cash equivalents, and restricted cash(b) | $ | 466 | |||
Undrawn 2016 Revolver availability(c) | 4,301 | ||||
| Total debt and other long-term obligations | 20,629 | ||||
| Total equity | 8,258 | ||||
(a)In addition, we have the following sources of liquidity:
i.In March 2021, we established an at-the-market stock offering program ("ATM Program") through which we may, from time to time, issue and sell shares of our common stock having an aggregate gross sales price of up to $750 million to or through sales agents. No shares of common stock have been sold under the ATM Program.
ii.In April 2019, we established a CP Program through which we may issue short term, unsecured CP Notes. Amounts available under the CP Program may be issued, repaid and re-issued from time to time, with the aggregate principal amount of CP Notes outstanding under the CP Program at any time not to exceed $1.0 billion. As of December 31, 2021, there were $265 million of CP Notes outstanding under our CP Program. We intend to maintain available commitments under our 2016 Revolver in an amount at least equal to the amount of CP Notes outstanding at any point in time.
(b)Inclusive of $5 million included within "Other assets, net" on our condensed consolidated balance sheet.
(c)Availability at any point in time is subject to reaffirmation of the representations and warranties in, and there being no default under, the credit agreement governing our 2016 Revolver.
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SUMMARY OF MAINTENANCE AND FINANCIAL COVENANTS | ||||||||||||||||||||
| Debt | Borrower / Issuer | Covenant(a) | Covenant Level Requirement | As of December 31, 2021 | ||||||||||||||||
Maintenance Financial Covenants(b) | ||||||||||||||||||||
| 2016 Credit Facility | CCIC | Total Net Leverage Ratio | ≤ 6.50x | 5.4x | ||||||||||||||||
| 2016 Credit Facility | CCIC | Total Senior Secured Leverage Ratio | ≤ 3.50x | 0.7x | ||||||||||||||||
| 2016 Credit Facility | CCIC | Consolidated Interest Coverage Ratio(c) | N/A | N/A | ||||||||||||||||
| Restrictive Negative Financial Covenants | ||||||||||||||||||||
| Financial covenants restricting ability to incur additional debt | ||||||||||||||||||||
| 2012 Secured Notes | CC Holdings GS V LLC and Crown Castle GS III Corp. | Debt to Adjusted Consolidated Cash Flow Ratio | ≤ 3.50x | 1.8x | ||||||||||||||||
| Financial covenants requiring excess cash flows to be deposited in a cash trap reserve account and not released | ||||||||||||||||||||
| 2015 Tower Revenue Notes | Crown Castle Towers LLC and its Subsidiaries | Debt Service Coverage Ratio | > 1.75x | (d) | 14.5x | |||||||||||||||
| 2018 Tower Revenue Notes | Crown Castle Towers LLC and its Subsidiaries | Debt Service Coverage Ratio | > 1.75x | (d) | 14.5x | |||||||||||||||
| 2009 Securitized Notes | Pinnacle Towers Acquisition Holdings LLC and its Subsidiaries | Debt Service Coverage Ratio | > 1.30x | (d) | 16.8x | |||||||||||||||
| Financial covenants restricting ability of relevant issuer to issue additional notes under the applicable indenture | ||||||||||||||||||||
| 2015 Tower Revenue Notes | Crown Castle Towers LLC and its Subsidiaries | Debt Service Coverage Ratio | ≥ 2.00x | (e) | 14.5x | |||||||||||||||
| 2018 Tower Revenue Notes | Crown Castle Towers LLC and its Subsidiaries | Debt Service Coverage Ratio | ≥ 2.00x | (e) | 14.5x | |||||||||||||||
| 2009 Securitized Notes | Pinnacle Towers Acquisition Holdings LLC and its Subsidiaries | Debt Service Coverage Ratio | ≥ 2.34x | (e) | 16.8x | |||||||||||||||
(a)As defined in the respective debt agreement. In the indentures for the 2015 Tower Revenue Notes, 2018 Tower Revenue Notes and the 2009 Securitized Notes, the defined term for Debt Service Coverage Ratio is "DSCR." Total Net Leverage Ratio, Total Senior Secured Leverage Ratio and all DSCR ratios are calculated using the trailing twelve months.
(b)Failure to comply with the financial maintenance covenants would, absent a waiver, result in an event of default under the credit agreement governing our 2016 Credit Facility.
(c)Applicable solely to the extent that the senior unsecured debt rating by any two of S&P, Moody's and Fitch is lower than BBB-, Baa3 or BBB-, respectively. If applicable, the consolidated interest coverage ratio must be greater than or equal to 2.50.
(d)The 2015 Tower Revenue Notes, 2018 Tower Revenue Notes and 2009 Securitized Notes also include the potential for amortization events, which could result in applying current and future cash flow to the prepayment of debt with applicable prepayment consideration. An amortization event occurs when the Debt Service Coverage Ratio falls below 1.45x, 1.45x or 1.15x, in each case as described under the indentures for the 2015 Tower Revenue Notes, 2018 Tower Revenue Notes or 2009 Securitized Notes, respectively.
(e)Rating Agency Confirmation (as defined in the respective debt agreement) is also required.
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INTEREST RATE SENSITIVITY(a)(b) | ||||||||
| Years Ending December 31, | ||||||||
| (as of December 31, 2021; in millions) | 2022 | 2023 | ||||||
| Fixed Rate Debt: | ||||||||
Face Value of Principal Outstanding(c) | $ | 18,397 | $ | 18,390 | ||||
Current Interest Payment Obligations(d) | 607 | 606 | ||||||
Effect of 0.125% Change in Interest Rates(e) | — | — | ||||||
Floating Rate Debt:(f) | ||||||||
Face Value of Principal Outstanding(c) | $ | 2,122 | $ | 2,068 | ||||
Current Interest Payment Obligations(g) | 30 | 30 | ||||||
Effect of 0.125% Change in Interest Rates(h) | 3 | 3 | ||||||
(a)Excludes finance leases and other obligations.
(b)Excludes the commitment fee the Company pays on the undrawn available amount under the 2016 Revolver. As of December 31, 2021, the commitment fee ranged from 0.080% to 0.300%, based on the Company's senior unsecured debt rating, per annum.
(c)Face value, net of required amortizations; assumes no maturity or balloon principal payments; excludes finance leases.
(d)Interest expense calculated based on current interest rates.
(e)Interest expense calculated based on current interest rates until the sooner of the (1) stated maturity date or (2) the Anticipated Repayment Date, at which time the face value amount outstanding of such indebtedness is refinanced at current interest rates as of December 31, 2021, plus 12.5 bps.
(f)In June 2021, the Company entered into an amendment to the credit agreement governing our 2016 Credit Facility that provided for, among other things, reductions to the interest rate spread ("Spread") and unused commitment fee ("Commitment Fee") percentage upon meeting specified annual sustainability targets ("Targets") and increases to the Spread and Commitment Fee percentage upon the failure to meet specified annual sustainability thresholds ("Thresholds"). The Spread and Commitment Fee are subject to an upward adjustment of up to 0.05% and 0.01%, respectively, if the Company fails to achieve the Thresholds. The Spread and Commitment Fee are subject to a downward adjustment of up to 0.05% and 0.01%, respectively, if the Company achieves the Targets. In January 2022, the Company submitted the required documentation and received confirmation from its administrative agent that all Targets were met as of December 31, 2021, and, as such, the Spread and Commitment Fee percentage were reduced for 2022. The reduction of the Spread on the 2016 Credit Facility is reflected in the table above for the years ended December 31, 2022 and 2023.
(g)Interest expense calculated based on current interest rates as of December 31, 2021. Calculation assumes no changes to future interest rate margin spread over LIBOR due to changes in the borrower’s senior unsecured credit rating.
(h)Interest expense calculated based on current interest rates as of December 31, 2021, plus 12.5 bps.
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| DEFINITIONS | ||
Non-GAAP Financial Measures, Segment Measures and Other Calculations
This Supplement includes presentations of Income (loss) from continuing operations (as adjusted), including per share—diluted amounts, Adjusted EBITDA, Adjusted Funds from Operations ("AFFO"), including per share amounts, Funds from Operations ("FFO"), including per share amounts, and Organic Contribution to Site Rental Revenues, which are non-GAAP financial measures. These non-GAAP financial measures are not intended as alternative measures of operating results or cash flow from operations (as determined in accordance with Generally Accepted Accounting Principles ("GAAP")).
Our non-GAAP financial measures may not be comparable to similarly titled measures of other companies, including other companies in the communications infrastructure sector or other REITs.
In addition to the non-GAAP financial measures used herein, we also provide Segment Site Rental Gross Margin, Segment Services and Other Gross Margin and Segment Operating Profit, which are key measures used by management to evaluate our operating segments. These segment measures are provided pursuant to GAAP requirements related to segment reporting. In addition, we provide the components of certain GAAP measures, such as capital expenditures.
Our non-GAAP financial measures are presented as additional information because management believes these measures are useful indicators of the financial performance of our business. Among other things, management believes that:
•Income (loss) from continuing operations (as adjusted), including per share—diluted amounts, is useful to investors and other interested parties in evaluating our financial performance. Management believes that this measure is meaningful to investors as it adjusts Income (loss) from continuing operations to exclude the impact of the Nontypical Items (as defined in this Supplemental Information Package and described further in our press release dated January 27, 2021), which management believes are unusual (including with respect to magnitude), infrequent and not reasonably likely to recur in the near term, to provide further insight into our results of operations and underlying trends and projections. Management also believes that identifying the impact of Nontypical Items as adjustments provides more transparency and comparability across periods. There can be no assurances that such items will not recur in future periods. Income (loss) from continuing operations (as adjusted), including per share—diluted amounts should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.
•Adjusted EBITDA is useful to investors or other interested parties in evaluating our financial performance. Adjusted EBITDA is the primary measure used by management (1) to evaluate the economic productivity of our operations and (2) for purposes of making decisions about allocating resources to, and assessing the performance of, our operations. Management believes that Adjusted EBITDA helps investors or other interested parties meaningfully evaluate and compare the results of our operations (1) from period to period and (2) to our competitors, by removing the impact of our capital structure (primarily interest charges from our outstanding debt) and asset base (primarily depreciation, amortization and accretion) from our financial results. Management also believes Adjusted EBITDA is frequently used by investors or other interested parties in the evaluation of the communications infrastructure sector and other REITs to measure financial performance without regard to items such as depreciation, amortization and accretion which can vary depending upon accounting methods and the book value of assets. In addition, Adjusted EBITDA is similar to the measure of current financial performance generally used in our debt covenant calculations. Separately, we are also disclosing Adjusted EBITDA as adjusted to exclude the impact of Nontypical Items, which management believes are unusual (including with respect to magnitude), infrequent and not reasonably likely to recur in the near term, to provide further insight into our results of operations and underlying trends and projections. Management also believes that identifying the impact of Nontypical Items as adjustments provides increased transparency and comparability across periods. There can be no assurances that such items will not recur in future periods. Adjusted EBITDA (including as further adjusted to exclude Nontypical Items) should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.
•AFFO, including per share amounts, is useful to investors or other interested parties in evaluating our financial performance. Management believes that AFFO helps investors or other interested parties meaningfully evaluate our financial performance as it includes (1) the impact of our capital structure (primarily interest expense on our outstanding debt and dividends on our preferred stock (in periods where applicable)) and (2) sustaining capital expenditures, and excludes the impact of our (a) asset base (primarily depreciation, amortization and accretion) and (b) certain non-cash items, including straight-lined revenues and expenses related to fixed escalations and rent free periods. GAAP requires rental revenues and expenses related to leases that contain specified rental increases over the life of the lease to be recognized evenly over the life of the lease. In accordance with GAAP, if payment terms call for fixed escalations, or rent free periods, the revenue or expense is recognized on a straight-lined basis over the fixed, non-cancelable term of the contract. Management notes that Crown Castle uses AFFO
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only as a performance measure. Separately, we are also disclosing AFFO as adjusted to exclude the impact of Nontypical Items, which management believes are unusual (including with respect to magnitude), infrequent and not reasonably likely to recur in the near term, to provide further insight into our results of operations and underlying trends and projections. Management also believes that identifying the impact of Nontypical Items as adjustments provides increased transparency and comparability across periods. There can be no assurances that such items will not recur in future periods. AFFO (including as further adjusted to exclude Nontypical Items) should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance and should not be considered as an alternative to cash flows from operations or as residual cash flow available for discretionary investment.
•FFO, including per share amounts, is useful to investors or other interested parties in evaluating our financial performance. Management believes that FFO may be used by investors or other interested parties as a basis to compare our financial performance with that of other REITs. FFO helps investors or other interested parties meaningfully evaluate financial performance by excluding the impact of our asset base (primarily depreciation, amortization and accretion). FFO is not a key performance indicator used by Crown Castle. FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance and should not be considered as an alternative to cash flow from operations.
•Organic Contribution to Site Rental Revenues is useful to investors or other interested parties in understanding the components of the year-over-year changes in our site rental revenues computed in accordance with GAAP. Management uses the Organic Contribution to Site Rental Revenues to assess year-over-year growth rates for our rental activities, to evaluate current performance, to capture trends in rental rates, new leasing activities and tenant non-renewals in our core business, as well to forecast future results. Organic Contribution to Site Rental Revenues is not meant as an alternative measure of revenue and should be considered only as a supplement in understanding and assessing the performance of our site rental revenues computed in accordance with GAAP.
•Consolidated Return on Invested Capital and Segment Cash Yield are useful to investors or other interested parties in evaluating the financial performance of our assets. Management believes that these metrics are useful in assessing our efficiency at allocating capital to generate returns over time. Consolidated Return on Invested Capital and Segment Cash Yield are not meant as alternatives to GAAP measures such as revenues, operating income, Segment Site Rental Gross Margin, and certain asset classes (such as property and equipment, site rental contracts and tenant relationships, and goodwill) computed in accordance with GAAP. Such non-GAAP metrics should be considered only as a supplement in understanding and assessing the performance of our assets.
We define our non-GAAP financial measures, segment measures and other calculations as follows:
Non-GAAP Financial Measures
Income (loss) from continuing operations (as adjusted). We define Income (loss) from continuing operations (as adjusted) as Income (loss) from continuing operations less other operating income resulting from the Nontypical Items, plus incremental operating expenses and asset write-downs as a result of the Nontypical Items.
Income (loss) from continuing operations (as adjusted) per share—diluted. We define Income (loss) from continuing operations (as adjusted) per share—diluted as Income (loss) from continuing operations (as adjusted), divided by diluted weighted-average common shares outstanding.
Adjusted EBITDA. We define Adjusted EBITDA as Income (loss) from continuing operations plus restructuring charges (credits), asset write-down charges, acquisition and integration costs, depreciation, amortization and accretion, amortization of prepaid lease purchase price adjustments, interest expense and amortization of deferred financing costs, (gains) losses on retirement of long-term obligations, net (gain) loss on interest rate swaps, (gains) losses on foreign currency swaps, impairment of available-for-sale securities, interest income, other (income) expense, (benefit) provision for income taxes, cumulative effect of a change in accounting principle and stock-based compensation expense. Separately, Adjusted EBITDA, as adjusted to exclude the impact of Nontypical Items, reflects Adjusted EBITDA, less other operating income resulting from the Nontypical Items, plus incremental operating expenses as a result of the Nontypical Items.
Adjusted Funds from Operations. We define Adjusted Funds from Operations as FFO before straight-lined revenue, straight-lined expense, stock-based compensation expense, non-cash portion of tax provision, non-real estate related depreciation, amortization and accretion, amortization of non-cash interest expense, other (income) expense, (gains) losses on retirement of long-term obligations, net (gain) loss on interest rate swaps, (gains) losses on foreign currency swaps, impairment of available-for-sale securities, acquisition and
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integration costs, restructuring charges (credits), cumulative effect of a change in accounting principle and adjustments for noncontrolling interests, less sustaining capital expenditures. Separately, Adjusted Funds from Operations, as adjusted to exclude the impact of Nontypical Items, reflects Adjusted Funds from Operations, less other operating income resulting from the Nontypical Items, plus incremental operating expenses as a result of the Nontypical Items.
AFFO per share. We define AFFO per share as AFFO, including as adjusted to exclude the impact of Nontypical Items, divided by diluted weighted-average common shares outstanding.
Funds from Operations. We define Funds from Operations as Income (loss) from continuing operations plus real estate related depreciation, amortization and accretion and asset write-down charges, less noncontrolling interest and cash paid for preferred stock dividends (in periods where applicable), and is a measure of funds from operations attributable to CCIC common stockholders.
FFO per share. We define FFO per share as FFO divided by the diluted weighted-average common shares outstanding.
Organic Contribution to Site Rental Revenues. We define the Organic Contribution to Site Rental Revenues as the sum of the change in GAAP site rental revenues related to (1) new leasing activity, including revenues from the construction of small cells and the impact of prepaid rent, (2) escalators and less (3) non-renewals of tenant contracts.
Consolidated Invested Capital. We define Consolidated Invested Capital as gross investment in 1) property and equipment (excluding construction in process), 2) site rental contracts and tenant relationships, and 3) goodwill.
Consolidated Return on Invested Capital. We define Return on Invested Capital as Adjusted EBITDA less cash taxes divided by Consolidated Invested Capital.
Segment Net Invested Capital. We define Segment Net Invested Capital as gross investment in 1) property and equipment, excluding the impact of construction in process and non-productive assets (such as information technology assets and buildings), reduced by the amount of prepaid rent received from customers (excluding any deferred credits recorded in connection with acquisitions), 2) site rental contracts and tenant relationships, and 3) goodwill, excluding the impact of certain assets and liabilities recorded in connection with acquisitions (primarily deferred credits).
Segment Cash Yield on Invested Capital. We define Segment Cash Yield on Invested Capital as Segment Site Rental Gross Margin adjusted for the impacts of 1) amortization of prepaid rent, 2) straight-lined revenues, 3) straight-lined expenses, and 4) indirect labor costs related to the Fiber segment divided by Segment Net Invested Capital.
Segment Measures
Segment Site Rental Gross Margin. We define Segment Site Rental Gross Margin as segment site rental revenues less segment site rental costs of operations, excluding stock-based compensation expense and prepaid lease purchase price adjustments recorded in consolidated site rental costs of operations.
Segment Services and Other Gross Margin. We define Segment Services and Other Gross Margin as segment services and other revenues less segment services and other costs of operations, excluding stock-based compensation expense recorded in consolidated services and other costs of operations.
Segment Operating Profit. We define Segment Operating Profit as segment site rental gross margin plus segment services and other gross margin, and segment other operating (income) expense, 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. Additionally, certain costs are shared across segments and are reflected in our segment measures through allocations that management believes to be reasonable.
Other Calculations
New leasing activity. We define new leasing activity as site rental revenues growth exclusive of the impact from straight-line accounting from (1) tenant additions across our entire portfolio, (2) renewals or extensions of tenant contracts and (3) year-over-year changes in prepaid rent amortization.
Core leasing activity. We define core leasing activity as site rental revenues growth from tenant additions across our entire portfolio and renewals or extensions of tenant contracts, exclusive of the impacts from both straight-line accounting and prepaid rent amortization.
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Non-renewals. We define non-renewals of tenant contracts as the reduction in site rental revenues as a result of tenant churn, terminations and, in limited circumstances, reductions of existing lease rates.
Discretionary capital expenditures. We define discretionary capital expenditures as those capital expenditures made with respect to activities which we believe exhibit sufficient potential to enhance long-term stockholder value. They primarily consist of expansion or development of communications infrastructure (including capital expenditures related to (1) enhancing communications infrastructure in order to add new tenants for the first time or support subsequent tenant equipment augmentations or (2) modifying the structure of a communications infrastructure asset to accommodate additional tenants) and construction of new communications infrastructure. Discretionary capital expenditures also include purchases of land interests (which primarily relates to land assets under towers as we seek to manage our interests in the land beneath our towers), certain technology-related investments necessary to support and scale future customer demand for our communications infrastructure, and other capital projects.
Sustaining capital expenditures. We define sustaining capital expenditures as those capital expenditures not otherwise categorized as either discretionary or integration capital expenditures, such as (1) maintenance capital expenditures on our communications infrastructure assets that enable our tenants' ongoing quiet enjoyment of the communications infrastructure and (2) ordinary corporate capital expenditures.
The tables set forth on the following pages reconcile certain non-GAAP financial measures used herein to comparable GAAP financial measures. The components in these tables may not sum to the total due to rounding.
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Reconciliations of Non-GAAP Financial Measures to Comparable GAAP Financial Measures and Other Calculations:
Reconciliation of Historical Adjusted EBITDA:
| Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||||||||||
| (in millions) | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||||
| Income (loss) from continuing operations | $ | 353 | $ | 508 | $ | 1,158 | (a) | $ | 1,056 | ||||||||||||||||||||
| Adjustments to increase (decrease) Income (loss) from continuing operations: | |||||||||||||||||||||||||||||
| Asset write-down charges | 12 | 64 | 21 | 74 | |||||||||||||||||||||||||
| Acquisition and integration costs | — | 1 | 1 | 10 | |||||||||||||||||||||||||
| Depreciation, amortization and accretion | 415 | 401 | 1,644 | 1,608 | |||||||||||||||||||||||||
| Amortization of prepaid lease purchase price adjustments | 4 | 5 | 18 | 18 | |||||||||||||||||||||||||
Interest expense and amortization of deferred financing costs(b) | 164 | 167 | 657 | 689 | |||||||||||||||||||||||||
| (Gains) losses on retirement of long-term obligations | — | — | 145 | 95 | |||||||||||||||||||||||||
| Interest income | — | — | (1) | (2) | |||||||||||||||||||||||||
| Other (income) expense | 4 | — | 21 | 5 | |||||||||||||||||||||||||
| (Benefit) provision for income taxes | 1 | 5 | 21 | 20 | |||||||||||||||||||||||||
| Stock-based compensation expense | 31 | 28 | 131 | 133 | |||||||||||||||||||||||||
Adjusted EBITDA(c)(d) | $ | 984 | $ | 1,179 | $ | 3,816 | $ | 3,706 | |||||||||||||||||||||
Reconciliation of Current Outlook for Adjusted EBITDA:
| (in millions) | Full Year 2022 Outlook(f) | ||||||||||
| Income (loss) from continuing operations | $1,634 | to | $1,714 | ||||||||
| Adjustments to increase (decrease) Income (loss) from continuing operations: | |||||||||||
| Asset write-down charges | $15 | to | $25 | ||||||||
| Acquisition and integration costs | $0 | to | $8 | ||||||||
| Depreciation, amortization and accretion | $1,650 | to | $1,745 | ||||||||
| Amortization of prepaid lease purchase price adjustments | $16 | to | $18 | ||||||||
Interest expense and amortization of deferred financing costs(e) | $615 | to | $660 | ||||||||
| (Gains) losses on retirement of long-term obligations | $0 | to | $100 | ||||||||
| Interest income | $(1) | to | $0 | ||||||||
| Other (income) expense | $0 | to | $5 | ||||||||
| (Benefit) provision for income taxes | $25 | to | $33 | ||||||||
| Stock-based compensation expense | $135 | to | $139 | ||||||||
Adjusted EBITDA(c)(d) | $4,249 | to | $4,294 | ||||||||
(a)Does not reflect the impact related to the ATO Settlement (as defined in the April 8-K), which is attributable to discontinued operations as discussed in the April 8-K.
(b)See reconciliation of "Components of Historical Interest Expense and Amortization of Deferred Financing Costs" for a discussion of non-cash interest expense
(c)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definition of Adjusted EBITDA.
(d)The above reconciliation excludes line items included in our definition which are not applicable for the periods shown.
(e)See reconciliation of "Components of Current Outlook for Interest Expense and Amortization of Deferred Financing Costs" for a discussion of non-cash interest expense.
(f)As issued on January 26, 2022.
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Components of Historical Interest Expense and Amortization of Deferred Financing Costs:
| Three Months Ended December 31, | |||||||||||
| (in millions) | 2021 | 2020 | |||||||||
| Interest expense on debt obligations | $ | 160 | $ | 166 | |||||||
| Amortization of deferred financing costs and adjustments on long-term debt, net | 6 | 6 | |||||||||
| Other, net | (2) | (5) | |||||||||
| Interest expense and amortization of deferred financing costs | $ | 164 | $ | 167 | |||||||
Components of Current Outlook for Interest Expense and Amortization of Deferred Financing Costs:
| (in millions) | Full Year 2022 Outlook(a) | ||||||||||
| Interest expense on debt obligations | $617 | to | $637 | ||||||||
| Amortization of deferred financing costs and adjustments on long-term debt, net | $25 | to | $30 | ||||||||
| Other, net | $(20) | to | $(15) | ||||||||
| Interest expense and amortization of deferred financing costs | $615 | to | $660 | ||||||||
(a)As issued on January 26, 2022.
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Reconciliation of Historical FFO and AFFO:
| Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||||||||||
| (in millions, except per share amounts) | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||||
| Income (loss) from continuing operations | $ | 353 | $ | 508 | $ | 1,158 | (a) | $ | 1,056 | ||||||||||||||||||||
| Real estate related depreciation, amortization and accretion | 402 | 388 | 1,593 | 1,555 | |||||||||||||||||||||||||
| Asset write-down charges | 12 | 64 | 21 | 74 | |||||||||||||||||||||||||
| Dividends/distributions on preferred stock | — | — | — | (85) | |||||||||||||||||||||||||
FFO(b)(c)(d)(e) | $ | 767 | $ | 960 | $ | 2,772 | $ | 2,600 | |||||||||||||||||||||
| Weighted-average common shares outstanding—diluted | 434 | 433 | 434 | 425 | |||||||||||||||||||||||||
FFO per share(b)(c)(d)(e) | $ | 1.77 | $ | 2.22 | $ | 6.39 | $ | 6.12 | |||||||||||||||||||||
| FFO (from above) | $ | 767 | $ | 960 | $ | 2,772 | $ | 2,600 | |||||||||||||||||||||
| Adjustments to increase (decrease) FFO: | |||||||||||||||||||||||||||||
| Straight-lined revenue | (38) | 5 | (111) | (22) | |||||||||||||||||||||||||
| Straight-lined expense | 18 | 22 | 76 | 83 | |||||||||||||||||||||||||
| Stock-based compensation expense | 31 | 28 | 131 | 133 | |||||||||||||||||||||||||
| Non-cash portion of tax provision | (1) | (1) | 1 | 1 | |||||||||||||||||||||||||
| Non-real estate related depreciation, amortization and accretion | 13 | 13 | 51 | 53 | |||||||||||||||||||||||||
| Amortization of non-cash interest expense | 4 | 1 | 13 | 6 | |||||||||||||||||||||||||
| Other (income) expense | 4 | — | 21 | 5 | |||||||||||||||||||||||||
| (Gains) losses on retirement of long-term obligations | — | — | 145 | 95 | |||||||||||||||||||||||||
| Acquisition and integration costs | — | 1 | 1 | 10 | |||||||||||||||||||||||||
| Sustaining capital expenditures | (30) | (21) | (87) | (86) | |||||||||||||||||||||||||
AFFO(b)(c)(d)(e) | $ | 768 | $ | 1,008 | $ | 3,013 | $ | 2,878 | |||||||||||||||||||||
| Weighted-average common shares outstanding—diluted | 434 | 433 | 434 | 425 | |||||||||||||||||||||||||
AFFO per share(b)(c)(d)(e) | $ | 1.77 | $ | 2.33 | $ | 6.95 | $ | 6.78 | |||||||||||||||||||||
(a)Does not reflect the impact related to the ATO Settlement (as defined in the April 8-K), which is attributable to discontinued operations as discussed in the April 8-K.
(b)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of FFO and AFFO, including per share amounts.
(c)FFO and AFFO are reduced by cash paid for preferred stock dividends during the period in which they are paid.
(d)Attributable to CCIC common stockholders.
(e)The above reconciliation excludes line items included in our definition which are not applicable for the periods shown.
36
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
Reconciliation of Historical FFO and AFFO:
| Year Ended December 31, | |||||||||||||||||
| (in millions, except per share amounts) | 2019 | 2018 | 2017 | ||||||||||||||
| Income (loss) from continuing operations | $ | 860 | $ | 622 | $ | 366 | |||||||||||
| Real estate related depreciation, amortization and accretion | 1,517 | 1,471 | 1,210 | ||||||||||||||
| Asset write-down charges | 19 | 26 | 17 | ||||||||||||||
| Dividends/distributions on preferred stock | (113) | (113) | (30) | ||||||||||||||
FFO(a)(b)(c)(d) | $ | 2,284 | $ | 2,005 | $ | 1,563 | |||||||||||
Weighted-average common shares outstanding—diluted(e) | 418 | 415 | 383 | ||||||||||||||
FFO per share(a)(b)(c)(d)(e) | $ | 5.47 | $ | 4.83 | $ | 4.08 | |||||||||||
| FFO (from above) | $ | 2,284 | $ | 2,005 | $ | 1,563 | |||||||||||
| Adjustments to increase (decrease) FFO: | |||||||||||||||||
| Straight-lined revenue | (80) | (72) | — | ||||||||||||||
| Straight-lined expense | 93 | 90 | 93 | ||||||||||||||
| Stock-based compensation expense | 116 | 108 | 96 | ||||||||||||||
| Non-cash portion of tax provision | 5 | 2 | 9 | ||||||||||||||
| Non-real estate related depreciation, amortization and accretion | 55 | 56 | 31 | ||||||||||||||
| Amortization of non-cash interest expense | 1 | 7 | 9 | ||||||||||||||
| Other (income) expense | (1) | (1) | (1) | ||||||||||||||
| (Gains) losses on retirement of long-term obligations | 2 | 106 | 4 | ||||||||||||||
| Acquisition and integration costs | 13 | 27 | 61 | ||||||||||||||
| Sustaining capital expenditures | (117) | (105) | (85) | ||||||||||||||
AFFO(a)(b)(c)(d) | $ | 2,371 | $ | 2,223 | $ | 1,781 | |||||||||||
Weighted-average common shares outstanding—diluted(e) | 418 | 415 | 383 | ||||||||||||||
AFFO per share(a)(b)(c)(d)(e) | $ | 5.68 | $ | 5.36 | $ | 4.65 | |||||||||||
(a)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of FFO and AFFO, including per share amounts.
(b)FFO and AFFO are reduced by cash paid for preferred stock dividends during the period in which they are paid.
(c)Attributable to CCIC common stockholders.
(d)The above reconciliation excludes line items included in our definition which are not applicable for the periods shown.
(e)For all periods prior to the year ended December 31, 2020, the diluted weighted-average common shares outstanding does not include any conversions of preferred stock in the share count.
37
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
Reconciliation of Current Outlook for FFO and AFFO:
| (in millions, except per share amounts) | Full Year 2022 Outlook(e) | ||||||||||
| Income (loss) from continuing operations | $1,634 | to | $1,714 | ||||||||
| Real estate related depreciation, amortization and accretion | $1,607 | to | $1,687 | ||||||||
| Asset write-down charges | $15 | to | $25 | ||||||||
FFO(a)(b)(c) | $3,318 | to | $3,363 | ||||||||
Weighted-average common shares outstanding—diluted(d) | 435 | ||||||||||
FFO per share(a)(b)(c(d) | $7.63 | to | $7.73 | ||||||||
| FFO (from above) | $3,318 | to | $3,363 | ||||||||
| Adjustments to increase (decrease) FFO: | |||||||||||
| Straight-lined revenue | $(379) | to | $(359) | ||||||||
| Straight-lined expense | $56 | to | $76 | ||||||||
| Stock-based compensation expense | $135 | to | $139 | ||||||||
| Non-cash portion of tax provision | $0 | to | $15 | ||||||||
| Non-real estate related depreciation, amortization and accretion | $43 | to | $58 | ||||||||
| Amortization of non-cash interest expense | $5 | to | $15 | ||||||||
| Other (income) expense | $0 | to | $5 | ||||||||
| (Gains) losses on retirement of long-term obligations | $0 | to | $100 | ||||||||
| Acquisition and integration costs | $0 | to | $8 | ||||||||
| Sustaining capital expenditures | $(113) | to | $(93) | ||||||||
AFFO(a)(b)(c) | $3,178 | to | $3,223 | ||||||||
Weighted-average common shares outstanding—diluted(d) | 435 | ||||||||||
AFFO per share(a)(b)(c)(d) | $7.31 | to | $7.41 | ||||||||
(a)See "Non-GAAP Financial Measures, Segment Measures and Other Calculations" for a discussion of our definitions of FFO, including per share amounts, and AFFO, including per share amounts.
(b)Attributable to CCIC common stockholders.
(c)The above reconciliation excludes line items included in our definition which are not applicable for the periods shown.
(d)The assumption for diluted weighted-average common shares outstanding for full year 2022 Outlook is based on the diluted common shares outstanding as of December 31, 2021.
(e)As issued on January 26, 2022.
38
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
Reconciliation of Results Adjusted for Nontypical Items to As Reported Results:
| Full Year 2021 | Full Year 2020 | Full Year 2021 Growth Rates | ||||||||||||||||||||||||||||||||||||||||||||||||
| (dollars in millions, except per share amounts) | As Reported | As Reported | Less: Impact from Nontypical Items | Exclusive of Impact from Nontypical Items | As Reported | Less: Impact from Nontypical Items | Exclusive of Impact from Nontypical Items | |||||||||||||||||||||||||||||||||||||||||||
| Site rental revenues | $ | 5,719 | $ | 5,320 | $ | — | $ | 5,320 | 8 | % | — | % | 8 | % | ||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations(a) | 1,158 | (c) | 1,056 | (223) | (d) | 833 | 10 | % | 29 | % | (d) | 39 | % | |||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations per share—diluted(a)(b) | 2.67 | (c) | 2.35 | (0.52) | (d) | 1.83 | 14 | % | 32 | % | (d) | 46 | % | |||||||||||||||||||||||||||||||||||||
Adjusted EBITDA(a) | 3,816 | 3,706 | (286) | (e) | 3,420 | 3 | % | 9 | % | (e) | 12 | % | ||||||||||||||||||||||||||||||||||||||
AFFO(a)(b) | 3,013 | 2,878 | (286) | (e) | 2,592 | 5 | % | 11 | % | (e) | 16 | % | ||||||||||||||||||||||||||||||||||||||
AFFO per share(a)(b) | $ | 6.95 | $ | 6.78 | $ | (0.68) | (e) | $ | 6.10 | 3 | % | 11 | % | (e) | 14 | % | ||||||||||||||||||||||||||||||||||
(a)See reconciliations herein for further information and reconciliation of non-GAAP financial measures to Income (loss) from continuing operations, as computed in accordance with GAAP.
(b)Attributable to CCIC common stockholders.
(c)Does not reflect the impact related to the ATO Settlement (as defined in the April 8-K), which is attributable to discontinued operations as discussed in the April 8-K.
(d)Impact from Nontypical Items on Income (loss) from continuing operations and Income (loss) from continuing operations per share—diluted included in the 2020 fourth quarter operating results is comprised of other operating income of $362 million, offset by incremental operating expenses of $76 million and associated asset write-downs of $63 million.
(e)Impact from Nontypical Items on Adjusted EBITDA, AFFO and AFFO per share included in the 2020 fourth quarter operating results is comprised of other operating income of $362 million, offset by incremental operating expenses of $76 million.
39
Crown Castle International Corp.
Fourth Quarter 2021
| COMPANY OVERVIEW | FINANCIALS & METRICS | ASSET PORTFOLIO OVERVIEW | CAPITALIZATION OVERVIEW | APPENDIX | ||||||||||
Net Debt to Last Quarter Annualized Adjusted EBITDA Calculation:
| Three Months Ended December 31, | ||||||||||||||
| (dollars in millions) | 2021 | 2020 | ||||||||||||
| Total face value of debt | $ | 20,799 | $ | 19,423 | ||||||||||
| Less: Ending cash, cash equivalents and restricted cash | 466 | 381 | ||||||||||||
| Total net debt | $ | 20,333 | $ | 19,042 | ||||||||||
| Adjusted EBITDA | $ | 984 | $ | 1,179 | (a) | |||||||||
| Last quarter annualized Adjusted EBITDA | 3,936 | 4,716 | ||||||||||||
| Net debt to Last Quarter Annualized Adjusted EBITDA | 5.2 | x | 4.0 | x | (a) | |||||||||
Cash Interest Coverage Ratio Calculation:
| Three Months Ended December 31, | ||||||||||||||
| (dollars in millions) | 2021 | 2020 | ||||||||||||
| Adjusted EBITDA | $ | 984 | $ | 1,179 | (a) | |||||||||
| Interest expense on debt obligations | 160 | 166 | ||||||||||||
| 6.2 | x | 7.1 | x | (a) | ||||||||||
(a)Includes the impact of Nontypical Items, as defined in our press release dated January 26, 2022, further described in our press release dated January 27, 2021 and reconciled in "Non-GAAP Financial Measures, Segment Measures and Other Calculations" herein.
40