Crown Castle International Reports Second Quarter 2004 Results
HOUSTON, July 28 /PRNewswire-FirstCall/ -- Crown Castle International Corp. (NYSE: CCI) today reported results for the second quarter ended June 30, 2004. Results from Crown Castle's UK subsidiary have been classified as discontinued operations, pending the closing of the previously announced sale.
Site rental revenue for the second quarter of 2004 increased 11.6% percent to $130.2 million, up $13.6 million from $116.6 million for the same period in the prior year. Operating income improved to $3.5 million in the second quarter of 2004 from $(10.0) million in the second quarter of 2003, an increase of $13.5 million.
Net loss was $39.6 million for the second quarter of 2004 compared to a net loss of $80.8 million for the same period in 2003. Net loss after deduction of dividends on preferred stock was $48.9 million in the second quarter of 2004 compared to a loss of $100.9 million for the same period last year. Second quarter net loss per share was $(0.22) compared to a loss per share of $(0.47) in last year's second quarter.
OPERATING RESULTS
US site rental revenue for the second quarter of 2004 increased $9.2 million, or 8.3%, to $119.7 million, from $110.5 million for the same period in 2003. US site rental gross margin, defined as site rental revenue less site rental cost of operations, increased 13.0% to $82.5 million, up $9.5 million in the second quarter of 2004 from the same period in 2003. On a consolidated basis, site rental gross margin, defined as site rental revenue less site rental cost of operations, increased 16.8% to $89.5 million, up $12.9 million in the second quarter of 2004 from the same period in 2003. These results approximate same tower sales and gross margin as over 99% of Crown Castle's sites were in operation for the 12 months preceding June 30, 2004.
"We are very pleased with the second quarter results and the growth we continue to see in our core business," stated John P. Kelly, President and Chief Executive Officer of Crown Castle. "In the past year, we have achieved $51.6 million growth in annualized recurring gross margin on $54.4 million of additional annualized recurring revenue, while total general and administrative costs have remained unchanged. Based on our signed leases to date and our expected leasing during the second half of the year, we expect US leasing to increase approximately 25% this year compared to last year."
Net cash from operating activities for the second quarter of 2004 was $35.2 million. Free cash flow, defined as net cash from operating activities less capital expenditures, was a source of cash of $22.6 million for the second quarter of 2004. For the second quarter of 2004, total capital expenditures were $12.7 million, comprised of $3.5 million of maintenance capital expenditures and $9.2 million of revenue generating capital expenditures. Crown Castle had $232.5 million of cash and cash equivalents as of June 30, 2004.
SALE OF UK SUBSIDIARY
On June 28, 2004, Crown Castle announced it had signed a definitive agreement to sell its UK subsidiary to National Grid Transco Plc for $2.035 billion in cash. Crown Castle will use approximately $1.3 billion of the proceeds from the transaction to fully repay Crown Castle Operating Company's credit facility. Crown Castle expects to use the remaining net proceeds of approximately $740 million to repay debt or to invest in new business opportunities in the US.
As a result of the announced transaction, Crown Castle's UK operations have been classified as discontinued operations. The closing date of the transaction, subject to certain approvals, is expected to be on or before September 30, 2004.
"We are continuing to proceed with closing the sale of the UK business," stated W. Benjamin Moreland, Chief Financial Officer of Crown Castle. "We are finalizing a refinancing plan for the new balance sheet that we are targeting will deliver significant interest expense savings by January 1, 2005."
OUTLOOK
The following statements and outlook table are based on current expectations and assumptions and assume a US dollar to Australian dollar exchange rate of 0.70 US dollars to 1.00 Australian dollar. 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 are set forth below and in Crown Castle's filings with the Securities and Exchange Commission.
Crown Castle has increased its 2004 Outlook for Site Rental Revenue from between $524 million and $528 million to between $525 million and $530 million and Adjusted EBITDA from between $270 million and $280 million to between $280 million and $287 million. Based primarily on increased leasing activity, Crown Castle has raised its 2004 outlook for revenue generating capital expenditures from between $23 million and $30 million to between $33 million and $40 million.
The following table sets forth Crown Castle's current outlook for the third quarter and full year 2004 (dollars in millions):
Third Quarter Full Year 2004 2004 Site Rental Revenue $ 134 to 136 $ 525 to 530 Adjusted EBITDA $ 70 to 73 $ 280 to 287 Maintenance capital expenditures $ 2 to 3 $ 7 to 10 Revenue generating capital expenditures $ 13 to 15 $ 33 to 40 The following table sets forth Crown Castle's current outlook for 2005 (dollars in millions): 2005 Outlook Site Rental Revenue $ 565 to 575 Adjusted EBITDA $ 310 to 320 Net cash provided by operating activities $ 225 to 245 Maintenance capital expenditures $ 7 to 10 Revenue generating capital expenditures $ 23 to 30 Free cash flow $ 195 to 215
The Outlook above does not include results from our UK subsidiary. Crown Castle has not issued 2004 Outlook for net cash provided by operating activities and free cash flow because of the impact the timing of the expected closing of the sale of the UK subsidiary will have on 2004 interest expense. Crown Castle's 2005 Outlook for net cash provided by operating activities includes expected savings from interest expense reductions that may be achieved through refinancings and further debt reductions associated with the application of sales proceeds and cash balances, and refinancings. Free cash flow is defined as net cash provided by operating activities less all capital expenditures (both maintenance and revenue generating capital expenditures).
CONFERENCE CALL DETAILS
Crown Castle has scheduled a conference call for Thursday, July 29, 2004, at 9:30 a.m. eastern time to discuss second quarter results and Crown Castle's Outlook. Please dial 303-205-0044 and ask for the Crown Castle call at least 10 minutes prior to the start time. A telephonic replay of the conference call will be available from 11:30 a.m. eastern time on Thursday, July 29, 2004, through 11:59 p.m. eastern time on Thursday, August 5, 2004, and may be accessed by dialing 303-590-3000 using passcode 11003229#. An audio archive will also be available on the company's website at http://www.crowncastle.com shortly after the call and will be accessible for approximately 90 days.
Pro forma for the previously announced sale of Crown Castle UK, Crown Castle International Corp. engineers, deploys, owns and operates technologically advanced shared wireless infrastructure, including extensive networks of towers and rooftops. Crown Castle offers significant wireless communications coverage to 68 of the top 100 United States markets and to substantially all of the Australian population. Crown Castle owns, operates and manages over 10,600 and over 1,300 wireless communication sites in the U.S. and Australia, respectively. For more information on Crown Castle visit: http://www.crowncastle.com .
Non-GAAP Financial Measures:
This press release includes presentations of Free Cash Flow and Adjusted EBITDA, which are non-GAAP financial measures. Crown Castle defines Free Cash Flow as net cash provided by operating activities less capital expenditures (both amounts from the Consolidated Statement of Cash Flows). Crown Castle defines Adjusted EBITDA as net loss plus cumulative effect of change in accounting principle, income (loss) from discontinued operations, minority interests, provision for income taxes, interest expense, amortization of deferred financing costs and dividends on preferred stock, interest and other income (expense), depreciation, amortization and accretion, non-cash general and administrative compensation charges, asset write-down charges and restructuring charges (credits). Free Cash Flow and Adjusted EBITDA are not intended as alternative measures of operating results or cash flow from operations (as determined in accordance with generally accepted accounting principles). Further, our measure of Free Cash Flow and Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Free Cash Flow is presented as additional information because management believes it to be a useful indicator of our ability to execute our business strategy without reliance on additional borrowing or the use of our cash and cash equivalents. Adjusted EBITDA is presented as additional information because management believes it to be a useful indicator of the current financial performance of our core businesses. In addition, Adjusted EBITDA is the measure of current financial performance generally used in our debt covenant calculations. The tables set forth below reconcile these non-GAAP financial measures to comparable GAAP financial measures. Our results under GAAP are set forth in the financial statements following this press release.
Reconciliations of Non-GAAP Financial Measures to Comparable GAAP Financial Measures
Free Cash Flow is computed as follows: (In thousands of dollars) For the Three Months Ended June 30, 2004 June 30, 2003 Net cash provided by operating activities $ 35,232 $ 29,600 Less: Capital expenditures (12,681) (7,989) Free Cash Flow $ 22,551 $21,611
Free Cash Flow for the year ending December 31, 2005 is forecasted as follows:
(in millions of dollars) Full Year 2005 Outlook Net cash provided by operating activities $ 225.0 to 245.0 Less: Capital expenditures $ 30.0) to (40.0) Free Cash Flow $ 195.0 to 215.0 Adjusted EBITDA is computed as follows: (in thousands of dollars) Three Months Ended June 30, 2004 2003 Net loss $ (39,594) $ (80,831) Income from discontinued operations, net of tax (16,455) (2,099) Minority interests 1,463 730 Provision for income taxes 184 127 Interest expense and amortization of deferred financing costs 56,568 63,809 Interest and other income (expense) 1,349 8,271 Depreciation, amortization and accretion 61,119 60,763 Non-cash general and administrative compensation charges 6,203 5,834 Asset write-down charges 1,868 1,380 Restructuring charges (credits) --- 2,349 Adjusted EBITDA $ 72,705 $ 60,333 Adjusted EBITDA for the quarter ending September 30, 2004 is forecasted as follows: (in millions of dollars) Q3 2004 Outlook Net income (loss) $ 527.0 to 557.0 Cumulative effect of change in accounting principle --- Income from discontinued operations (560.0) to (630.0) Minority interests 0.5 to 2.5 Provision for income taxes 0.1 to 0.2 Interest expense, amortization of deferred financing costs and dividends on preferred stock 55.0 to 59.0 Interest and other (income) expense 1.0 to 2.5 Depreciation, amortization and accretion 60.0 to 62.0 Non-cash general and administrative compensation charges 1.4 to 1.5 Asset write-down charges 1.5 to 2.0 Restructuring charges --- Adjusted EBITDA $ 70.0 to 73.0
Adjusted EBITDA for the year ending December 31, 2004 and the year ending December 31, 2005 is forecasted as follows:
(in millions of dollars) Full Year 2004 Full Year 2005 Outlook Outlook Net income (loss) $ 326.9 to 480.0 $ (21.3) to (51.3) Cumulative effect of change in accounting principle --- --- Income from discontinued operations (560.0) to (630.0) --- Minority interests (1.0) to 4.0 (1.0) to 4.0 Provision for income taxes 0.5 to 1.0 0.0 to 2.0 Interest expense, amortization of deferred financing costs and dividends on preferred stock 183.3 to 207.0 71.5 to 81.5 Interest and other (income) expense 19.8 to 26.2 19.8 to 23.8 Depreciation, amortization and accretion 221.0 to 251.0 221.0 to 251.0 Non-cash general and administrative compensation charges 12.0 to 14.0 12.0 to 14.0 Asset write-down charges 3.8 to 7.6 1.9 to 3.0 Restructuring charges --- --- Adjusted EBITDA $ 280.0 to 287.0 $ 310.0 to 320.0 Cautionary Language Regarding Forward-Looking Statements
This press release contains forward-looking statements and information that are based on our management's current expectations. Such statements include, but are not limited to plans, projections and estimates regarding (i) demand and leasing rates for our sites and towers, (ii) our ability to close the sale of our UK business ("UK Transaction") in the time frame anticipated or at all, (iii) the use of proceeds from the UK Transaction, (iv) the effect of the UK Transaction on our financial and operating position, (v) potential refinancing plans, (vi) potential interest expense reduction, (vii) currency exchange rates, (viii) revenues, (ix) net cash provided by operating activities, (x) adjusting EBITDA (xi) capital expenditures, and (xii) free cash flow, including free cash flow per share. Such forward- looking statements are subject to certain risks, uncertainties and assumptions, including but not limited to prevailing market conditions and the following:
-- Our substantial level of indebtedness may adversely affect our ability to react to changes in our business and limit our ability to use debt to fund future capital needs. -- Restrictive covenants on our debt instruments may limit our ability to take actions that may be in our best interests. If we fail to comply with our covenants, our debt may be accelerated. -- Our business depends on the demand for wireless communications and towers, and we may be adversely affected by any slowdown in such demand. -- The loss, consolidation, network sharing or financial instability of any of our limited number of customers may materially decrease revenues. -- An economic or wireless telecommunications industry slowdown may materially and adversely affect our business and the business of our customers. -- We operate in a competitive industry and some of our competitors have significantly more resources or less debt than we do. -- Technology changes may significantly reduce the demand for site leases and negatively impact our revenues. -- 2.5G/3G and other technologies, including digital terrestrial television, may not deploy or be adopted by customers as rapidly or in the manner projected. -- We generally lease or sublease the land under our sites and towers and may not be able to maintain these leases. -- Our international operations expose us to changes in foreign currency exchange rates. -- We may need additional financing, which may not be available for strategic growth opportunities or contractual obligations. -- Fluctuations in market interest rates may increase interest expense relating to our floating rate indebtedness. -- Laws and regulations, which may change at any time and with which we may fail to comply, regulate our business. -- Our network services business has historically experienced significant volatility in demand, which reduces the predictability of our results. -- We are heavily dependent on our senior management. -- We may suffer from future claims if radio frequency emissions from equipment on our sites and towers are demonstrated to cause negative health effects. -- Certain provisions of our certificate of incorporation, bylaws and operative agreements and domestic and international competition laws may make it more difficult for a third party to acquire control of us or for us to acquire control of a third party, even if such a change in control would be beneficial to our stockholders. -- Sales or issuances of a substantial number of shares of our common stock may adversely affect the market price of our common stock. -- Disputes with customers and suppliers may adversely affect results.
Should one or more of these or other risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected. More information about potential risk factors which could affect our results is included in our filings with the Securities and Exchange Commission.
Crown Castle International Corp. Condensed Consolidated Statement of Operations And Other Financial Data (in thousands, except per share data) Three Months Ended Six Months Ended June 30, June 30, 2004 2003 2004 2003 Net revenues: Site rental $ 130,203 $ 116,646 $ 259,172 $ 230,481 Network services and other 18,513 19,629 33,216 36,548 Total net revenues 148,716 136,275 292,388 267,029 Costs of operations: Site rental 40,683 39,985 81,618 80,593 Network services and other 12,272 12,819 23,268 24,430 Total costs of operations 52,955 52,804 104,886 105,023 General and administrative 22,685 22,220 44,295 42,738 Corporate development 371 918 810 2,538 Restructuring charges (credits) --- 2,349 (33) 2,349 Asset write-down charges 1,868 1,380 3,816 1,380 Non-cash general and administrative compensation charges 6,203 5,834 8,418 7,728 Depreciation, amortization and accretion 61,119 60,763 122,344 122,226 Operating income (loss) 3,515 (9,993) 7,852 (16,953) Interest and other income (expense) (1,349) (8,271) (26,376) (10,834) Interest expense and amortization of deferred financing costs (56,568) (63,809) (113,890) (127,520) Loss from continuing operations before income taxes, minority interests and cumulative effect of change in accounting principle (54,402) (82,073) (132,414) (155,307) Provision for income taxes (184) (127) (337) (243) Minority interests (1,463) (730) (2,809) (1,287) Loss from continuing operations before cumulative effect of change in accounting principle (56,049) (82,930) (135,560) (156,837) Income from discontinued operations, net of tax 16,455 2,099 30,999 7,541 Loss before cumulative effect of change in accounting principle (39,594) (80,831) (104,561) (149,296) Cumulative effect of change in accounting principle for asset retirement obligations --- --- --- (551) Net loss (39,594) (80,831) (104,561) (149,847) Dividends on preferred stock, net of gains (losses) on purchases of preferred stock (9,332) (20,081) (19,028) (34,452) Net loss after deduction of dividends on preferred stock, net of gains (losses) on purchases of preferred stock $ (48,926) $(100,912) $(123,589) $(184,299) Per common share - basic and diluted: Loss from continuing operations before cumulative effect of change in accounting principle $ (0.29) $ (0.48) $ (0.70) $ (0.88) Income from discontinued operations 0.07 0.01 0.14 0.03 Cumulative effect of change in accounting principle --- --- --- --- Net loss $ (0.22) $ (0.47) $ (0.56) $ (0.85) Common shares outstanding - basic and diluted 221,853 215,969 220,574 216,464 Adjusted EBITDA (before restructuring and asset write-down charges): Site rental $ 82,197 $ 69,933 $ 163,609 $ 136,881 Network services and other (before corporate development expenses) (9,121) (8,682) (20,402) (17,613) Adjusted EBITDA before corporate development expenses 73,076 61,251 143,207 119,268 Corporate development (371) (918) (810) (2,538) Total Adjusted EBITDA $ 72,705 $ 60,333 $ 142,397 $ 116,730 Crown Castle International Corp. Condensed Consolidated Balance Sheet (in thousands) June 30, December 31, 2004 2003 ASSETS Current assets: Cash and cash equivalents $ 232,503 $ 462,427 Receivables, net of allowance for doubtful accounts 35,652 38,219 Inventories 9,308 9,615 Prepaid expenses and other current assets 30,714 32,133 Assets of discontinued operations 2,020,628 2,026,267 Total current assets 2,328,805 2,568,661 Property and equipment, net of accumulated depreciation 3,622,355 3,755,073 Goodwill 267,071 267,071 Deferred financing costs and other assets, net of accumulated amortization 151,975 146,786 $ 6,370,206 $ 6,737,591 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 9,060 $ 9,785 Accrued interest 43,705 49,063 Accrued compensation and related benefits 10,392 13,397 Deferred rental revenues and other accrued liabilities 97,043 106,384 Liabilities of discontinued operations 355,072 353,544 Long-term debt, current maturities 1,275,385 267,142 Total current liabilities 1,790,657 799,315 Long-term debt, less current maturities 1,898,752 3,182,850 Other liabilities 52,803 55,978 Total liabilities 3,742,212 4,038,143 Minority interests 207,700 208,333 Redeemable preferred stock 507,371 506,702 Stockholders' equity 1,912,923 1,984,413 $6,370,206 $6,737,591 Crown Castle International Corp. Condensed Consolidated Statement of Cash flows (in thousands) Three Months Ended June 30, 2004 2003 Cash flows from operating activities: Net loss $ (39,594) $ (80,831) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation, amortization and accretion 61,119 60,763 Non-cash general and administrative compensation charges 6,203 5,834 Amortization of deferred financing costs and discounts on long-term debt 2,813 17,378 Asset write-down charges 1,868 1,380 Minority interests and loss on issuance of interest in joint venture 1,463 8,844 Equity in losses (earnings) and write-downs of unconsolidated affiliates 1,405 1,380 Income from discontinued operations (16,455) (2,099) Changes in assets and liabilities: Increase in accrued interest 12,475 14,079 Increase in deferred rental revenues and other liabilities 3,275 1,128 Decrease in inventories, prepaid expenses and other assets 1,091 2,980 Increase (decrease) in accounts payable 924 (4,427) (Increase) decrease in receivables (1,355) 3,191 Net cash provided by operating activities 35,232 29,600 Cash flows from investing activities: Proceeds from disposition of property and equipment 1,065 --- Capital expenditures (12,681) (7,989) Investments in affiliates and other (305) (12,973) Maturities of investments --- 14,808 Acquisition of minority interest in joint venture --- (5,873) Net cash used for investing activities (11,921) (12,027) Cash flows from financing activities: Proceeds from issuance of capital stock 22,711 896 Purchases of capital stock (12,901) (38,688) Principal payments on long-term debt (11,615) (4,750) Net borrowings (payments) under revolving credit agreements --- (10,000) Net cash used for financing activities (1,805) (52,542) Effect of exchange rate changes on cash (1,185) 2,026 Discontinued operations 40,697 15,695 Net increase (decrease) in cash and cash equivalents 61,018 (17,248) Cash and cash equivalents at beginning of period 171,485 476,950 Cash and cash equivalents at end of period $ 232,503 $ 459,702 Supplemental disclosure of cash flow information: Interest paid $ 40,065 $ 32,319 Income taxes paid 184 126 CROWN CASTLE INTERNATIONAL CORP. Summary Fact Sheet (in $ thousands) Quarter Ended 9/30/03 Quarter Ended 12/31/03 US AUS CCIC US AUS CCIC Revenues Site Rental 113,387 6,740 120,127 117,686 7,860 125,546 Services 16,361 1,035 17,396 17,561 811 18,372 Total Revenues 129,748 7,775 137,523 135,247 8,671 143,918 Operating Expenses Site Rental 37,298 2,764 40,062 39,353 3,167 42,520 Services 9,668 510 10,178 11,604 534 12,138 Total Operating Expenses 46,966 3,274 50,240 50,957 3,701 54,658 General & Administrative Site Rental 4,319 2,037 6,356 4,889 2,451 7,340 Services 15,066 --- 15,066 15,561 --- 15,561 Total General & Administrative 19,385 2,037 21,422 20,450 2,451 22,901 Operating Cash Flow Site Rental 71,770 1,939 73,709 73,444 2,242 75,686 Services (8,373) 525 (7,848) (9,604) 277 (9,327) Total Pre-Overhead Cash Flow 63,397 2,464 65,861 63,840 2,519 66,359 Corporate Overhead 1,039 --- 1,039 1,987 --- 1,987 Adjusted EBITDA 62,358 2,464 64,822 61,853 2,519 64,372 Quarter Ended 9/30/03 Quarter Ended 12/31/03 US AUS CCIC US AUS CCIC Gross Margins: Site Rental 67% 59% 67% 67% 60% 66% Services 41% 51% 41% 34% 34% 34% Operating Cash Flow Margins Site Rental 63% 29% 61% 62% 29% 60% Services -51% 51% -45% -55% 34% -51% Adjusted EBITDA Margin 48% 32% 47% 46% 29% 45% Quarter Ended 3/31/04 Quarter Ended 6/30/04 US AUS CCIC US AUS CCIC Revenues Site Rental 120,695 8,274 128,969 119,667 10,536 130,203 Services 13,499 1,204 14,703 17,390 1,123 18,513 Total Revenues 134,194 9,478 143,672 137,057 11,659 148,716 Operating Expenses Site Rental 37,233 3,702 40,935 37,172 3,511 40,683 Services 10,268 728 10,996 11,591 681 12,272 Total Operating Expenses 47,501 4,430 51,931 48,763 4,192 52,955 General & Administrative Site Rental 4,242 2,380 6,622 4,693 2,630 7,323 Services 14,988 --- 14,988 15,362 --- 15,362 Total General & Administrative 19,230 2,380 21,610 20,055 2,630 22,685 Operating Cash Flow Site Rental 79,220 2,192 81,412 77,802 4,395 82,197 Services (11,757) 476 (11,281) (9,563) 442 (9,121) Total Pre-Overhead Cash Flow 67,463 2,668 70,131 68,239 4,837 73,076 Corporate Overhead 439 --- 439 371 --- 371 Adjusted EBITDA 67,024 2,668 69,692 67,868 4,837 72,705 Quarter Ended 3/31/04 Quarter Ended 6/30/04 US AUS CCIC US AUS CCIC Gross Margins: Site Rental 69% 55% 68% 69% 67% 69% Services 24% 40% 25% 33% 39% 34% Operating Cash Flow Margins Site Rental 66% 26% 63% 65% 42% 63% Services -87% 40% -77% -55% 39% -49% Adjusted EBITDA Margin 50% 28% 49% 50% 41% 49% Reconciliation of Non-GAAP Financial Measure (Adjusted EBITDA) to GAAP Financial Measure: (in $ thousands) Quarter Ended 09/30/2003 12/31/2003 03/31/2004 06/30/2004 Net loss $(99,678) $(148,840) $(64,967) $(39,594) Income from discontinued operations, net of tax (5,076) 2,159 (14,544) (16,455) Cumulative effect of change in accounting principle for asset retirement obligations, net of related income tax benefits --- --- --- --- Minority interests (151) 1,258 1,346 1,463 Provision for income taxes 85 137 153 184 Interest expense, amortization of deferred financing costs and dividends on preferred stock 62,408 68,906 57,322 56,568 Interest and other income (expense) 35,104 72,521 25,027 1,349 Depreciation, amortization and accretion 60,846 61,378 61,225 61,119 Non-cash general and administrative compensation charges 6,205 53 2,215 6,203 Asset write-down charges 6,137 6,800 1,948 1,868 Restructuring charges (credits) (1,058) --- (33) --- Adjusted EBITDA $64,822 $64,372 $69,692 $72,705 CROWN CASTLE INTERNATIONAL CORP. Summary Fact Sheet Restricted and Unrestricted Subsidiaries (in $ thousands) Quarter Ended 9/30/03 Crown Restricted Atlantic Other CCIC Revenues Site Rental 94,620 25,507 --- 120,127 Services 14,034 3,362 --- 17,396 Total Revenues 108,654 28,869 --- 137,523 Operating Expenses Site Rental 31,162 8,900 --- 40,062 Services 9,349 829 --- 10,178 Total Operating Expenses 40,511 9,729 --- 50,240 General & Administrative Site Rental 5,899 457 --- 6,356 Services 12,664 988 1,414 15,066 Total General & Administrative 18,563 1,445 1,414 21,422 Operating Cash Flow Site Rental 57,559 16,150 --- 73,709 Services (7,979) 1,545 (1,414) (7,848) Total Pre-Overhead Cash Flow 49,580 17,695 (1,414) 65,861 Corporate Overhead 1,039 --- --- 1,039 Adjusted EBITDA 48,541 17,695 (1,414) 64,822 Quarter Ended 9/30/03 Crown Restricted Atlantic Other CCIC Gross Margins: Site Rental 67% 65% --- 67% Services 33% 75% --- 41% Operating Cash Flow Margins Site Rental 61% 63% --- 61% Services -57% 46% --- -45% Adjusted EBITDA Margin 45% 61% N/A 47% Quarter Ended 12/31/03 Crown Restricted Atlantic Other CCIC Revenues Site Rental 98,047 27,499 --- 125,546 Services 15,227 3,145 --- 18,372 Total Revenues 113,274 30,644 --- 143,918 Operating Expenses Site Rental 32,724 9,796 --- 42,520 Services 10,010 2,128 --- 12,138 Total Operating Expenses 42,734 11,924 --- 54,658 General & Administrative Site Rental 6,769 571 --- 7,340 Services 12,680 1,198 1,683 15,561 Total General & Administrative 19,449 1,769 1,683 22,901 Operating Cash Flow Site Rental 58,554 17,132 --- 75,686 Services (7,463) (181) (1,683) (9,327) Total Pre-Overhead Cash Flow 51,091 16,951 (1,683) 66,359 Corporate Overhead 1,987 --- --- 1,987 Adjusted EBITDA 49,104 16,951 (1,683) 64,372 Quarter Ended 12/31/03 Crown Restricted Atlantic Other CCIC Gross Margins: Site Rental 67% 64% --- 66% Services 34% 32% --- 34% Operating Cash Flow Margins Site Rental 60% 62% --- 60% Services -49% -6% --- -51% Adjusted EBITDA Margin 43% 55% N/A 45% Quarter Ended 3/31/04 Crown Restricted Atlantic Other CCIC Revenues Site Rental 100,896 28,073 --- 128,969 Services 13,178 1,525 --- 14,703 Total Revenues 114,074 29,598 --- 143,672 Operating Expenses Site Rental 31,427 9,508 --- 40,935 Services 9,373 1,623 --- 10,996 Total Operating Expenses 40,800 11,131 --- 51,931 General & Administrative Site Rental 6,163 459 --- 6,622 Services 12,325 989 1,674 14,988 Total General & Administrative 18,488 1,448 1,674 21,610 Operating Cash Flow Site Rental 63,306 18,106 --- 81,412 Services (8,520) (1,087) (1,674) (11,281) Total Pre-Overhead Cash Flow 54,786 17,019 (1,674) 70,131 Corporate Overhead 439 --- --- 439 Adjusted EBITDA 54,347 17,019 (1,674) 69,692 Quarter Ended 3/31/04 Crown Restricted Atlantic Other CCIC Gross Margins: Site Rental 69% 66% --- 68% Services 29% -6% --- 25% Operating Cash Flow Margins Site Rental 63% 64% --- 63% Services -65% -71% --- -77% Adjusted EBITDA Margin 48% 58% N/A 49% Quarter Ended 6/30/04 Crown Restricted Atlantic Other CCIC Revenues Site Rental 102,490 27,713 --- 130,203 Services 16,110 2,138 265 18,513 Total Revenues 118,600 29,851 265 148,716 Operating Expenses Site Rental 31,401 9,282 --- 40,683 Services 10,284 1,670 318 12,272 Total Operating Expenses 41,685 10,952 --- 52,955 General & Administrative Site Rental 6,847 476 --- 7,323 Services 13,365 802 1,195 15,362 Total General & Administrative 20,212 1,278 1,195 22,685 Operating Cash Flow Site Rental 64,242 17,955 --- 82,197 Services (7,539) (334) (1,248) (9,121) Total Pre-Overhead Cash Flow 56,703 17,621 (1,248) 73,076 Corporate Overhead 371 --- --- 371 Adjusted EBITDA 56,332 17,621 (1,248) 72,705 Quarter Ended 6/30/04 Crown Restricted Atlantic Other CCIC Gross Margins: Site Rental 69% 67% --- 69% Services 36% 22% -20% 34% Operating Cash Flow Margins Site Rental 63% 65% --- 63% Services -47% -16% -471% -49% Adjusted EBITDA Margin 47% 59% -471% 49% Reconciliation of Non-GAAP Financial Measure (Adjusted EBITDA) to GAAP Financial Measure: (in $ thousands) Quarter Ended 09/30/2003 12/31/2003 03/31/2004 06/30/2004 Net loss $(99,678) $(148,840) $(64,967) $(39,594) Income from discontinued operations, net of tax (5,076) 2,159 (14,544) (16,455) Cumulative effect of change in accounting principle for asset retirement obligations, net of related income tax benefits --- --- --- --- Minority interests (151) 1,258 1,346 1,463 Provision for income taxes 85 137 153 184 Interest expense, amortization of deferred financing costs and dividends on preferred stock 62,408 68,906 57,322 56,568 Interest and other income (expense) 35,104 72,521 25,027 1,349 Depreciation, amortization and accretion 60,846 61,378 61,225 61,119 Non-cash general and administrative compensation charges 6,205 53 2,215 6,203 Asset write-down charges 6,137 6,800 1,948 1,868 Restructuring charges (credits) (1,058) --- (33) --- Adjusted EBITDA $64,822 $64,372 $69,692 $72,705 CCI FACT SHEET Q2 2004 $ in thousands Q2 '03 Q2 '04 % Change CCUSA and Crown Atlantic Site Rental Revenue $110,504 $119,667 8% Ending Sites 10,718 10,608 -1% CCAUS Site Rental Revenue $6,142 $10,536 72% Ending Sites 1,387 1,388 0% TOTAL CCIC Site Rental Revenue $116,646 $130,203 12% Ending Sites 12,105 11,996 -1% Ending Cash and Investments $523,158 $232,503 Debt Bank Debt $1,019,424 $1,455,385 Bonds $2,167,414 $1,718,752 12 3/4% Preferred Stock $223,904 $0 6 1/4% & 8 1/4% Convertible Preferred Stock $506,033 $507,371 Total Debt $3,916,775 $3,681,508 Leverage Ratios Net Bank Debt / EBITDA* 2.1X 4.2X Net Bank Debt + Bonds / EBITDA* 12.0X 10.1X Total Net Debt / EBITDA* 14.1X 11.9X *Last Quarter Annualized Adjusted EBITDA $241,332 $290,820 Contacts: W. Benjamin Moreland, CFO Jay Brown, Treasurer Crown Castle International Corp. 713-570-3000
SOURCE Crown Castle International Corp. -0- 07/28/2004 /CONTACT: W. Benjamin Moreland, CFO, or Jay Brown, Treasurer, both of Crown Castle International Corp., +1-713-570-3000/ /Web site: http://www.crowncastle.com / (CCI) CO: Crown Castle International Corp. ST: Texas IN: CPR TLS SU: ERN CCA MAV AH-AP -- DAW039 -- 5257 07/28/2004 16:01 EDT http://www.prnewswire.com