Crown Castle International Reports Second Quarter 2005 Results; Completes $275 Million Revolving Credit Facility
HOUSTON, Aug. 2 /PRNewswire-FirstCall/ -- Crown Castle International Corp. (NYSE: CCI) today reported results for the second quarter ended June 30, 2005 and announced the completion of a $275 million revolving credit facility.
Site rental revenue for the second quarter of 2005 increased $14.4 million, or 10.8%, to $146.9 million from $132.5 million for the same period in the prior year. Site rental gross margin, defined as site rental revenue less site rental cost of operations, increased 14.1% to $99.1 million, up $12.2 million in the second quarter of 2005 from the same period in 2004. Adjusted EBITDA for the second quarter of 2005 increased $11.1 million, or 15.5%, to $82.6 million, up from $71.5 million for the same period in 2004.
Recurring cash flow, defined as Adjusted EBITDA less interest expense less sustaining capital expenditures, was $44.5 million for the second quarter of 2005, compared to $11.4 million for the second quarter of 2004. Recurring cash flow per share, defined as recurring cash flow divided by common shares outstanding, was $0.20 in the second quarter of 2005 compared to $0.05 in the second quarter of 2004.
As previously announced during the second quarter, Crown Castle refinanced virtually all of its outstanding indebtedness at a lower interest rate, retiring $1.4 billion of its high yield notes. Net loss was ($227.5) million for the second quarter of 2005, inclusive of $198.5 million in losses from the early retirement of debt, compared to a net loss of ($50.8) million for the same period in 2004. Net loss after deduction of dividends on preferred stock was ($237.0) million in the second quarter of 2005, compared to a loss of ($60.1) million for the same period last year. Weighted average common shares outstanding decreased to 218.2 million for the second quarter of 2005 from 221.9 million for the same period in the prior year. Second quarter net loss per share was $(1.09), inclusive of $0.91 per share losses from the early retirement of debt, compared to a net loss per share of $(0.27) in last year's second quarter.
OPERATING RESULTS
US site rental revenue for the second quarter of 2005 increased $12.5 million, or 10.3%, to $133.5 million, compared to second quarter 2004 US site rental revenue of $121.0 million. US site rental gross margin increased 13.8% to $90.3 million, up $10.9 million in the second quarter of 2005 from the same period in 2004.
Australia site rental revenue for the second quarter of 2005 increased $1.8 million, or 15.8%, to $13.3 million, up from $11.5 million for the same period in 2004. Australia site rental gross margin increased 17.7% to $8.9 million, up $1.3 million in the second quarter of 2005 from the same period in 2004. In both the second quarter of 2004 and 2005, Australia site rental revenue and site rental gross margin benefited by approximately $2 million from an annual customer contractual payment.
"We are very pleased with the growth we continue to see in our core business reflected in our strong second quarter results," stated John P. Kelly, President and Chief Executive Officer of Crown Castle. "Comparing the second quarter 2004 to second quarter 2005, we have achieved $48.8 million growth in annualized site rental gross margin on $57.4 million of additional annualized site rental revenue. The growth in our core business coupled with annualized interest expense savings of $84.7 million, which we've achieved through various refinancings over the last year, resulted in annualized recurring cash flow growth of $132.4 million. Our tower leasing business is benefiting from the addition of new tenants to our existing tower portfolio caused by the continued growth in wireless minutes and introduction of new data services by wireless carriers in the US and Australia. Further, we expect to see similar to slightly higher levels of leasing activity in the second half of 2005 as we saw in the first half."
INVESTMENTS
During the second quarter of 2005, Crown Castle invested $231.8 million in capital expenditures and the purchase of its equity and convertible securities. During the quarter, Crown Castle purchased approximately 10.4 million shares of its common stock using approximately $175.8 million in cash, an average of $16.94 per share, and utilized $43.7 million in cash to retire $24.6 million of face value of its 4% Convertible Notes (convertible to common shares at $10.83 per share), reducing potential shares outstanding by 2.3 million. Common shares outstanding -- basic and diluted -- were 215.8 million on June 30, 2005. Also during the second quarter of 2005, Crown Castle spent $12.3 million on capital expenditures, comprised of $2.7 million of sustaining capital expenditures and $9.6 million of revenue generating capital expenditures.
On July 12, 2005, Crown Castle announced that it had entered into a definitive agreement to acquire 467 towers from TrinTel Communications, Inc. ("TrinTel"), based in Irving, Texas, for approximately $145 million in cash. Crown Castle's acquisition of the TrinTel towers closed August 1, 2005. TrinTel's portfolio currently produces approximately $14 million in annualized site rental revenue, over 98% of which is derived from wireless telephony tenants, and approximately $9 million in annualized site rental gross margin. The towers were built between 1998 and 2001, with an average age of 4.7 years, and are primarily located in key US markets, such as Dallas-Fort Worth and Detroit. Crown Castle funded the acquisition entirely through borrowings under its new credit facility (described below).
Also on July 12, 2005, Crown Castle announced it had made an additional investment of $55 million in FiberTower Corporation ("FiberTower"), a privately-held provider of backhaul services. FiberTower designs, deploys and operates radio-based backhaul networks for major wireless carriers. Crown Castle retains approximately 32%, on a fully diluted basis, of FiberTower and remains FiberTower's largest shareholder. As part of Crown Castle's investment, FiberTower raised a total of $150 million through an equity offering, with investments from several prominent private equity firms.
BALANCE SHEET IMPROVEMENTS
On June 8, 2005, Crown Castle completed the sale of $1.9 billion of Senior Secured Tower Revenue Notes, Series 2005-1 ("Notes"), issued by an indirect US subsidiary. The Notes consist of five classes, which are all rated investment grade. The weighted average interest rate on the various classes of Notes is approximately 4.89%, entirely on a fixed interest rate basis.
Crown Castle used most of the net proceeds received from the Notes to fund the purchase of its 10 3/4% Senior Notes, 9 3/8% Senior Notes, 7.5% Senior Notes and 7.5% Series B Senior Notes, to repay its outstanding Crown Castle Atlantic credit facility, and to fund the redemption of its outstanding 9% Senior Notes, 9 1/2% Senior Notes, 10 3/8% Senior Discount Notes and 11 1/4% Senior Discount Notes. The balance of the net proceeds is expected to be used for general corporate purposes.
The Notes provide Crown Castle with the flexibility to use cash flow generated by its subsidiaries after debt service for any corporate purpose, subject to certain restrictions. As a result, Crown Castle may invest in tower acquisitions, tower builds, common stock repurchases, dividends or other investments it deems attractive without the significant limitations that previously existed under its high-yield notes.
In addition, the Notes allow, subject to certain conditions, for the issuance of additional notes based on increases in cash flow from growth on the existing tower assets and from newly acquired or built tower sites.
Further, on August 1, 2005, Crown Castle completed a $275 million revolving credit facility. Borrowings under the credit facility may be used for general corporate purposes, including capital expenditures, acquisitions, common stock purchases and dividends. Under the terms of the facility, Crown Castle may use up to $100 million of borrowings for stock purchases and dividends. Borrowings under the facility will bear interest at a rate per annum of 200 to 275 basis points (based on interest expense coverage) plus LIBOR.
KeyBank National Association and Calyon New York Branch were the co-lead arrangers of the credit facility. Royal Bank of Scotland was the documentation agent of the credit facility. The syndicate of lenders also included Morgan Stanley and Lehman Brothers.
"We are very excited to have completed a number of important milestones during the last several months," stated Ben Moreland, Chief Financial Officer of Crown Castle. "The $1.9 billion Notes offering, the completion of the $275 million revolving credit facility and the elimination of nearly all of our outstanding high-yield notes contributed to a vastly simplified, cheaper and more flexible capital structure. We have eliminated virtually all restrictions on the use of cash generated by our business after debt service, significantly reduced our annual interest expense and created an ongoing borrowing mechanism that should enable us to lever the growth that we expect in our business. As evidenced by the significant investments in our common stock and the acquisition of the TrinTel towers, our recent financing activities position Crown Castle to continue to make investments that drive recurring cash flow per share. We remain focused on our long-term goal of 20% to 25% annual growth in recurring cash flow per share through the expected growth in our core tower business and related investments."
OUTLOOK
The following outlook tables are based on current expectations and assumptions and assume a US dollar to Australian dollar exchange rate of 0.73 US dollars to 1.00 Australian dollars. This Outlook section contains forward-looking statements, and actual results may differ materially. Information regarding potential risks which could cause actual results to differ from the forward-looking statements herein is set forth below and in Crown Castle's filings with the Securities and Exchange Commission.
The following tables set forth Crown Castle's current outlook:
(dollars in millions) Third Quarter Fourth Quarter Full Year
2005 2005 2005
Site Rental Revenue $149 to 151 $153 to 156 $590 to 595
Site Rental Cost of
Operations $49 to 51 $49 to 51 $194 to 196
Site Rental Gross Margin $98 to 100 $102 to 105 $395 to 400
Adjusted EBITDA $80 to 82 $82 to 84 $320 to 325
Interest Expense $28 to 30 $28 to 30 $130 to 134
Sustaining Capital
Expenditures $4 to 6 $2 to 4 $10 to 14
Recurring Cash Flow $47 to 49 $49 to 52 $175 to 180
Revenue Generating Capital
Expenditures:
Revenue Enhancing on
Existing Sites $7 to 9 $5 to 7 $20 to 25
Land Purchases $5 to 10 $5 to 10 $12 to 23
New Site Construction $5 to 10 $10 to 15 $20 to 30
Total Revenue Generating
Capital Expenditures $17 to 29 $20 to 32 $52 to 78
CONFERENCE CALL DETAILS
Crown Castle has scheduled a conference call for Wednesday, August 3, 2005, at 10:30 a.m. eastern time to discuss second quarter results and Crown Castle's Outlook. Please dial 303-262-2051 and ask for the Crown Castle call at least 10 minutes prior to the start time. A telephonic replay of the conference call will be available from 12:30 p.m. eastern time on Wednesday, August 3, 2005 through 11:59 p.m. eastern time on Wednesday, August 10, 2005 and may be accessed by dialing 303-590-3000 using passcode 11034431#. An audio archive will also be available on Crown Castle's website at http://www.crowncastle.com shortly after the call and will be accessible for approximately 90 days.
Crown Castle International Corp. engineers, deploys, owns and operates technologically advanced shared wireless infrastructure, including extensive networks of towers. Crown Castle offers significant wireless communications coverage to 76 of the top 100 United States markets and to substantially all of the Australian population. Crown Castle owns, operates and manages over 11,000 and 1,300 wireless communication sites in the U.S. and Australia, respectively. For more information on Crown Castle visit: http://www.crowncastle.com .
Non-Cash Compensation and Discontinued Operations
Crown Castle incurs non-cash compensation charges related to the issuance of restricted stock and stock options to certain employees and executives. Beginning in the first quarter of 2005 and in accordance with the provisions of SEC Staff Accounting Bulletin No. 107, Crown Castle is classifying all non- cash compensation as components of cost of operations and general and administrative costs. In prior periods, Crown Castle had shown non-cash compensation as a separate line-item on its income statement. Prior period amounts of non-cash compensation have been reclassified for comparison purposes.
In January 2005, Crown Castle adopted a plan to sell OpenCell, a small subsidiary that manufactures distributed antenna system equipment. As a result, Crown Castle has restated its financial statements to present the assets, liabilities, results of operations and cash flows of OpenCell as amounts from discontinued operations. Such restatements have been made for all periods presented.
Summary of Non-Cash Amounts In Tower Gross Margin
In accordance with applicable accounting standards, Crown Castle recognizes site rental revenues and ground lease expenses monthly on a straight-line basis, regardless of whether the receipts and payments are in equal monthly amounts. An agreement, related to an acquisition in Australia, provides the seller with a rent-free period at the beginning of the lease term, and other agreements call for rent to be prepaid for a specified period. If, and to the extent the payment terms call for fixed escalations (as in fixed dollar or fixed percentage increases), the effect of such increases is recognized on a straight-line basis over the appropriate lease term. As a result of this accounting method, a portion of the revenue and expense recognized in a given period represents cash collected or paid in other periods.
A summary of the non-cash portions of our site rental revenues, ground lease expense and resulting impact on site rental gross margins is as follows:
(dollars in thousands) For the Three Months Ended
June 30, 2005
Non-Cash portion of site rental revenues:
Amounts attributable to rent-free periods $2,405
Amounts attributable to straight-line
recognition of fixed escalations $1,063
$3,468
Non-Cash portion of ground lease expense:
Amounts attributable to straight-line
recognition of fixed escalations $3,530
Non-Cash compensation charges 71
Non-Cash impact on site rental gross margins: $(133)
Non-GAAP Financial Measures
This press release includes presentations of Adjusted EBITDA and recurring cash flow, which are non-GAAP financial measures.
Crown Castle defines Adjusted EBITDA as net income (loss) plus cumulative effect of change in accounting principle, income (loss) from discontinued operations, minority interests, credit (provision) for income taxes, interest expense, amortization of deferred financing costs, interest and other income (expense), depreciation, amortization and accretion, operating non-cash compensation charges, asset write-down charges and restructuring charges (credits). Adjusted EBITDA is not intended as an alternative measure of operating results (as determined in accordance with Generally Accepted Accounting Principles (GAAP)). Adjusted EBITDA is presented as additional information because management believes it to be a useful indicator of the current financial performance of our core businesses. In addition, Adjusted EBITDA is the measure of current financial performance generally used in our debt covenant calculations.
Crown Castle defines recurring cash flow to be Adjusted EBITDA, less interest expense and less sustaining capital expenditures. Each of the amounts included in the calculation of recurring cash flow are computed in accordance with GAAP, with the exception of sustaining capital expenditures, which is not defined under GAAP. Sustaining capital expenditures are defined as capital expenditures (determined in accordance with GAAP) which do not increase the capacity or term of an asset. Recurring cash flow is not intended as an alternative measure of cash flow from operations (as determined in accordance with GAAP). Recurring cash flow is provided as additional information because management believes it to be useful in providing investors with a reasonable estimate of our cash flow available for discretionary investments (including expansion projects, improvements to existing sites, debt repayment, securities purchases and dividends) without reliance on additional borrowing or the use of our cash and cash equivalents.
Our measures of Adjusted EBITDA and recurring cash flow may not be comparable to similarly titled measures of other companies. The tables set forth below reconcile these non-GAAP financial measures to comparable GAAP financial measures.
Reconciliations of Non-GAAP Financial Measures to Comparable GAAP Financial Measures:
Adjusted EBITDA is computed as follows:
For the Three Months Ended
(dollars in thousands) June 30, 2005 June 30, 2004
Net income (loss) $(227,451) $(50,780)
Income (loss) from discontinued operations,
net of tax (2,347) (15,108)
Minority interests (798) 277
Credit (provision) for income taxes 147 684
Interest expense and amortization of
deferred financing costs 35,393 56,568
Interest and other income (expense) 202,635 1,311
Depreciation, amortization and accretion 72,712 70,473
Operating non-cash compensation charges 1,753 6,203
Asset write-down charges 555 1,868
Restructuring charges (credits) --- ---
Adjusted EBITDA $82,599 $71,496
Recurring Cash Flow is computed as follows:
For the Three Months Ended
(dollars in thousands) June 30, 2005 June 30, 2004
Net cash provided by operating activities $34,530 $36,796
Add: Other adjustments(A) 12,676 (21,868)
Less: Sustaining capital expenditures (2,751) (3,486)
Recurring Cash Flow $44,455 $11,442
(A) Other adjustments include adjustments for changes in assets and
liabilities, excluding the effects of acquisitions, restructuring
charges and provision for income taxes.
Sustaining Capital Expenditures is computed as follows:
For the Three Months Ended
(dollars in thousands) June 30, 2005 June 30, 2004
Capital expenditures $12,333 $12,643
Less: Revenue enhancing on existing sites (4,887) (6,618)
Less: Land purchases (795) ---
Less: New site construction (3,900) (2,539)
Sustaining Capital Expenditures $2,751 $3,486
Adjusted EBITDA for the quarters ending September 30, 2005 and
December 31, 2005 and the year ending December 31, 2005 is forecasted as
follows:
(dollars in millions) Q3 2005 Q4 2005 Full Year 2005
Outlook Outlook Outlook
Net income (loss) $(22) to (34) $(16) to (29) $(388) to (431)
Minority interests (1) to (2) (1) to (2) 0 to (4)
Credit (provision) for
income taxes 0.1 to 0.2 0.1 to 0.2 0.5 to 2
Interest expense and
amortization of
deferred financing
costs 28 to 30 28 to 30 130 to 134
Interest and other
income (expense) 2 to 3 0 to 2 285 to 295
Depreciation,
amortization and
accretion 70 to 75 72 to 77 280 to 300
Operating non-cash
compensation charges 5 to 6 1 to 2 8 to 10
Asset write-down charges 0 to 2 0 to 2 2 to 5
Restructuring charges
(credits) --- --- 8 to 9
Adjusted EBITDA $80 to 82 $82 to 84 $320 to 325
Recurring Cash Flow for the quarters ending September 30, 2005 and
December 31, 2005 and the year ending December 31, 2005 is forecasted as
follows:
(dollars in millions) Q3 2005 Q4 2005 Full Year 2005
Outlook Outlook Outlook
Net cash provided by
operating activities $48 to 53 $48 to 54 $169 to 190
Add: Other adjustments(A) 0 to 5 0 to 5 0 to 20
Less: Sustaining capital
expenditures (4) to (6) (2) to (4) (10) to (14)
Recurring Cash Flow $47 to 49 $49 to 52 $175 to 180
(A) Other adjustments include adjustments for changes in assets and
liabilities, excluding the effects of acquisitions, restructuring
charges and provision for income taxes.
Other Calculations:
Annualized quarter over quarter changes for the quarter ending June 30, 2005 is calculated as follows:
Three Months Three Months
Ended Ended
(dollars in millions) June 30, June 20, Change Annualized
2005 2004 (x4) (A)
Site rental revenue $146.9 $132.5 $14.4 $57.4
Less: Site rental
cost of operations 47.8 45.6 2.2 8.6
Site rental gross margin $99.1 $86.9 $12.2 $48.8
Interest expense 35.4 56.6 (21.2) (84.7)
Recurring Cash Flow 44.5 11.4 33.1 132.4
(A) Annualized calculations may not recalculate due to rounding
Sustaining Capital Expenditures for the quarters ending September 30, 2005
and December 31, 2005 and year ending December 31, 2005 is forecasted as
follows:
(dollars in millions) Q3 2005 Q4 2005 Full Year 2005
Outlook Outlook Outlook
Capital expenditures $21 to 35 $22 to 36 $62 to 92
Less: Revenue enhancing
on existing sites (7) to (9) (5) to (7) (20) to (25)
Less: Land purchases (5) to (10) (5) to (10) (12) to (23)
Less: New site construction (5) to (10) (10) to (15) (20) to (30)
Sustaining Capital
Expenditures $4 to 6 $2 to 4 $10 to 14
Site Rental Gross Margin for the quarters ending September 30, 2005 and
December 31, 2005 and for the year ending December 31, 2005 is forecasted as
follows:
(dollars in millions) Q3 2005 Q4 2005 Full Year 2005
Outlook Outlook Outlook
Site rental revenue $149 to 151 $153 to 156 $590 to 595
Less: Site rental cost
of operations (49) to (51) (49) to (51) (194) to (196)
Site Rental Gross Margin $98 to 100 $102 to 105 $395 to 400
Recurring Cash Flow for the quarters ending September 30, 2005 and
December 31, 2005 and for the year ending December 31, 2005 is forecasted as
follows:
(dollars in millions) Q3 2005 Q4 2005 Full Year 2005
Outlook Outlook Outlook
Adjusted EBITDA $80 to 82 $82 to 84 $320 to 325
Less: Interest expense (28) to (30) (28) to (30) (130) to (134)
Less: Sustaining capital
expenditures (4) to (6) (2) to (4) (10) to (14)
Recurring Cash Flow $47 to 49 $49 to 52 $175 to 180
Cautionary Language Regarding Forward-Looking Statements
This press release contains forward-looking statements and information that are based on our management's current expectations. Such statements include, but are not limited to, plans, projections and estimates regarding (i) growth in our business, demand for our towers and leasing rates and activity, (ii) growth in wireless minutes, (iii) availability of appropriate investments and return on investments, (iv) currency exchange rates, (v) site rental revenue, (vi) repair and maintenance expense, (vii) customer payments, (viii) site rental cost of operations, (ix) site rental gross margin, (x) Adjusted EBITDA, (xi) interest expense, (xii) sustaining capital expenditures, (xiii) recurring cash flow (including recurring cash flow per share), (xiv) revenue enhancing capital expenditures on existing sites, (xv) land purchases, (xvi) new site construction, and (xvii) revenue generating capital expenditures. Such forward-looking statements are subject to certain risks, uncertainties and assumptions, including but not limited to prevailing market conditions and the following:
* Our business depends on the demand for wireless communications and
towers, and we may be adversely affected by any slowdown in such
demand.
* The loss or consolidation of, network sharing among, or financial
instability of any of our limited number of customers may materially
decrease revenues.
* An economic or wireless telecommunications industry slowdown may
materially and adversely affect our business and the business of our
customers.
* Our substantial level of indebtedness may adversely affect our ability
to react to changes in our business and limit our ability to use debt
to fund future capital needs.
* We operate in a competitive industry and some of our competitors have
significantly more resources or less debt than we do.
* Technology changes may significantly reduce the demand for site leases
and negatively impact the growth in our revenues.
* 2.5G/3G and other technologies may not deploy or be adopted by
customers as rapidly or in the manner projected.
* We generally lease or sublease the land under our sites and towers and
may not be able to extend these leases.
* We may need additional financing, which may not be available, for
strategic growth opportunities.
* Restrictive covenants on our debt instruments may limit our ability to
take actions that may be in our best interests.
* Laws and regulations, which may change at any time and with which we
may fail to comply, regulate our business.
* We are heavily dependent on our senior management.
* Our network services business has historically experienced significant
volatility in demand, which reduces the predictability of our results.
* We may suffer from future claims if radio frequency emissions from
wireless handsets or equipment on our towers are demonstrated to cause
negative health effects.
* Certain provisions of our certificate of incorporation, bylaws and
operative agreements and domestic and international competition laws
may make it more difficult for a third party to acquire control of us
or for us to acquire control of a third party, even if such a change
in control would be beneficial to our stockholders.
* Sales or issuances of a substantial number of shares of our common
stock may adversely affect the market price of our common stock.
* Disputes with customers and suppliers may adversely affect results.
Should one or more of these or other risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected. More information about potential risk factors which could affect our results is included in our filings with the Securities and Exchange Commission.
Contacts: W. Benjamin Moreland, CFO
Jay Brown, Treasurer
Crown Castle International Corp.
713-570-3000
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,
2005 2004 2005 2004
Net revenues:
Site rental $146,867 $132,507 $287,793 $262,687
Network services and other 20,818 18,248 36,997 32,951
Total net revenues 167,685 150,755 324,790 295,638
Costs of operations
(exclusive of depreciation,
amortization and accretion):
Site rental (including
non-cash compensation
charges) 47,759 45,618 95,439 90,220
Network services and other
(including non-cash
compensation charges) 14,403 12,106 25,871 23,141
Total costs of operations 62,162 57,724 121,310 113,361
General and administrative
(including non-cash
compensation charges) 23,890 27,367 46,437 49,633
Corporate development 787 371 1,219 810
Restructuring charges
(credits) (including
non-cash compensation
charges) --- --- 8,477 (33)
Asset write-down charges 555 1,868 991 3,816
Depreciation, amortization
and accretion 72,712 70,473 144,884 141,216
Operating loss 7,579 (7,048) 1,472 (13,165)
Interest and other income
(expense) (202,635) (1,311) (285,652) (26,727)
Interest expense and
amortization of deferred
financing costs (35,393) (56,568) (74,662) (113,890)
Loss from continuing
operations before income
taxes and minority
interests (230,449) (64,927) (358,842) (153,782)
Provision for income taxes (147) (684) (291) (1,337)
Minority interests 798 (277) 2,073 (408)
Loss from continuing
operations (229,798) (65,888) (357,060) (155,527)
Income (loss) from
discontinued operations,
net of tax 2,347 15,108 848 28,110
Net loss (227,451) (50,780) (356,212) (127,417)
Dividends on preferred stock (9,568) (9,332) (19,221) (19,028)
Net loss after deduction of
dividends on preferred
stock $(237,019) $(60,112) $(375,433) $(146,445)
Per common share - basic
and diluted:
Loss from continuing
operations $ (1.10) $ (0.34) $ (1.70) $ (0.79)
Income (loss) from
discontinued operations 0.01 0.07 --- 0.13
Net loss $ (1.09) $ (0.27) $ (1.70) $ (0.66)
Common shares outstanding -
basic and diluted 218,237 221,853 220,919 220,574
Adjusted EBITDA (before
restructuring and asset
write-down charges):
Site rental $ 91,373 $ 79,781 177,372 158,814
Network services
and other (8,774) (8,285) (18,247) (18,562)
Total Adjusted EBITDA $ 82,599 $ 71,496 $ 159,125 $ 140,252
Non-cash compensation charges:
Site rental non-cash
compensation charges $ 71 $ 215 $ 118 $ 292
Network services
non-cash compensation
charges 35 109 59 148
General and administrative
non-cash compensation
charges 1,647 5,879 3,124 7,978
Total operating non-cash
compensation charge 1,753 6,203 3,301 8,418
Restructuring non-cash
compensation charges --- --- 6,424 ---
Total non-cash
compensation charges $ 1,753 $ 6,203 $ 9,725 $ 8,418
Crown Castle International Corp.
Condensed Consolidated balance sheet
(in thousands)
June 30, Dec. 31,
2005 2004
ASSETS
Current assets:
Cash and cash equivalents $258,962 $566,707
Receivables, net of allowance for
doubtful accounts 13,059 28,366
Inventories 4,318 4,781
Deferred site rental receivable 4,974 6,395
Prepaid expenses and other current assets 28,001 28,771
Restricted cash (including amounts returned on
July 15, 2005 of $24,451) 81,676 ---
Assets of discontinued operations --- 3,693
Total current assets 390,990 638,713
Restricted cash 2,500 ---
Property and equipment, net of accumulated
depreciation 3,242,818 3,368,166
Goodwill 333,718 333,718
Deferred site rental receivable 88,734 84,928
Deferred financing costs and other assets,
net of accumulated amortization 139,037 145,997
$4,197,797 $4,571,522
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $10,398 $12,168
Accrued interest 8,701 43,308
Accrued compensation and related benefits 8,458 15,445
Deferred rental revenues and other accrued
liabilities 117,130 116,326
Liabilities of discontinued operations --- 568
Long-term debt, current maturities 52,927 97,250
Total current liabilities 197,614 285,065
Long-term debt, less current maturities 1,975,686 1,753,148
Deferred ground lease payable 123,812 116,874
Other liabilities 39,798 44,302
Total liabilities 2,336,910 2,199,389
Minority interests 28,192 30,468
Redeemable preferred stock 508,709 508,040
Stockholders' equity 1,323,986 1,833,625
$4,197,797 $4,571,522
Note: In accordance with the Indenture Agreement governing the Notes,
all rental cash receipts for the month are restricted and held by
the trustee. Amounts in excess of reserve balances as calculated
by the trustee are returned to the Company on the 15th of the
subsequent month.
Crown Castle International Corp.
Condensed Consolidated Statement of Cash flows
(in thousands)
Six Months Ended
June 30,
2005 2004
Cash flows from operating activities:
Net loss $(356,212) $(127,417)
Adjustments to reconcile net loss to
net cash provided by operating activities:
Depreciation, amortization and accretion 144,884 141,216
Losses on purchases of long-term debt 281,121 24,367
Amortization of deferred financing costs
and discounts on long-term debt 2,370 5,773
Non-cash compensation charges 9,725 8,418
Asset write-down charges 991 3,816
Minority interests (2,073) 408
Equity in losses and write-downs of
unconsolidated affiliates 4,921 2,578
Loss (income) from discontinued operations (848) (28,110)
Interest rate swap termination payment 655 ---
Changes in assets and liabilities:
Increase (decrease) in accrued interest (34,607) (5,358)
Increase (decrease) in accounts payable (1,750) (791)
Increase (decrease) in deferred rental
revenues, deferred ground lease payables
and other liabilities (924) 823
Decrease (increase) in receivables 15,151 1,930
Decrease (increase) in inventories,
prepaid expenses, deferred site
rental receivable and other assets (1,833) (2,182)
Net cash provided by (used for)
operating activities 61,571 25,471
Cash flows from investing activities:
Proceeds from investments and disposition
of property and equipment 1,602 1,480
Capital expenditures (21,932) (19,244)
Investments in affiliates and other --- (14,333)
Maturities of investments --- 62,650
Purchases of investments --- (36,050)
Net cash provided by (used for)
investing activities (20,330) (5,497)
Cash flows from financing activities:
Proceeds from issuance of long-term debt 1,900,000 ---
Proceeds from issuance of capital stock 25,086 26,273
Purchases and redemption of long-term debt (1,793,291) (267,359)
Payments under revolving credit agreements (180,000) (15,000)
Purchases of capital stock (179,875) (17,009)
Principal payments on long-term debt --- (14,365)
Incurrence of financing costs (29,665) (412)
Initial funding of restricted cash (48,968) ---
Net (increase) decrease in restricted cash (35,208) ---
Interest rate swap payments (6,381) ---
Dividends on preferred stock (4,125) ---
Net cash used for financing activities (352,427) (287,872)
Effect of exchange rate changes on cash (532) (921)
Discontinued operations 3,973 51,892
Net decrease in cash and cash equivalents (307,745) (216,927)
Cash and cash equivalents at beginning of period 566,707 409,584
Cash and cash equivalents at end of period $258,962 $192,657
Supplemental disclosure of cash flow information:
Interest paid $104,782 $111,925
Income taxes paid 7,291 337
CROWN CASTLE INTERNATIONAL CORP.
Summary Fact Sheet
(in $ thousands)
Quarter Ended 9/30/04
CCUSA CCAL EmB CCIC
Revenues
Site Rental 125,546 9,683 --- 135,229
Services 13,900 975 81 14,956
Total Revenues 139,446 10,658 81 150,185
Operating Expenses
Site Rental 42,377 3,427 --- 45,804
Services 9,201 892 624 10,717
Total Operating Expenses 51,578 4,319 624 56,521
General & Administrative
Site Rental 4,211 2,517 --- 6,728
Services 14,403 --- 1,805 16,208
Total General & Administrative 18,614 2,517 1,805 22,936
Operating Cash Flow 69,254 3,822 (2,348) 70,728
Corporate Development 211 --- --- 211
Add: Non-Cash Compensation 1,433 9 1,442
Adjusted EBITDA 70,476 3,831 (2,348) 71,959
Quarter Ended 9/30/04
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 66% 65% N/M 66%
Services 34% 9% N/M 28%
Operating Cash Flow Margins 50% 36% N/M 47%
Adjusted EBITDA Margin 51% 36% N/M 48%
CROWN CASTLE INTERNATIONAL CORP.
Summary Fact Sheet
(in $ thousands)
Quarter Ended 12/31/04
CCUSA CCAL EmB CCIC
Revenues
Site Rental 128,838 10,711 --- 139,549
Services 16,907 1,003 76 17,986
Total Revenues 145,745 11,714 76 157,535
Operating Expenses
Site Rental 43,474 4,655 --- 48,129
Services 11,494 825 575 12,894
Total Operating Expenses 54,968 5,480 575 61,023
General & Administrative
Site Rental 4,629 3,039 --- 7,668
Services 16,303 --- 1,125 17,428
Total General & Administrative 20,932 3,039 1,125 25,096
Operating Cash Flow 69,845 3,195 (1,624) 71,416
Corporate Development 434 --- --- 434
Add: Non-Cash Compensation 3,212 16 3,228
Adjusted EBITDA 72,623 3,211 (1,624) 74,210
Quarter Ended 12/31/04
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 66% 57% N/M 66%
Services 32% 18% N/M 28%
Operating Cash Flow Margins 48% 27% N/M 45%
Adjusted EBITDA Margin 50% 27% N/M 47%
CROWN CASTLE INTERNATIONAL CORP.
Summary Fact Sheet
(in $ thousands)
Quarter Ended 3/31/05
CCUSA CCAL EmB CCIC
Revenues
Site Rental 130,692 10,173 61 140,926
Services 14,138 2,041 --- 16,179
Total Revenues 144,830 12,214 61 157,105
Operating Expenses
Site Rental 43,011 4,590 79 47,680
Services 10,277 915 276 11,468
Total Operating Expenses 53,288 5,505 355 59,148
General & Administrative
Site Rental 4,472 2,836 --- 7,308
Services 14,587 --- 652 15,239
Total General & Administrative 19,059 2,836 652 22,547
Operating Cash Flow 72,483 3,873 (946) 75,410
Corporate Development --- --- 432 432
Add: Non-Cash Compensation 1,506 14 28 1,548
Adjusted EBITDA 73,989 3,887 (1,350) 76,526
Quarter Ended 3/31/05
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 67% 55% N/M 66%
Services 27% 55% N/M 29%
Operating Cash Flow Margins 50% 32% N/M 48%
Adjusted EBITDA Margin 51% 32% N/M 49%
CROWN CASTLE INTERNATIONAL CORP.
Summary Fact Sheet
(in $ thousands)
Quarter Ended 6/30/05
CCUSA CCAL EmB CCIC
Revenues
Site Rental 133,540 13,260 67 146,867
Services 19,082 1,736 --- 20,818
Total Revenues 152,622 14,996 67 167,685
Operating Expenses
Site Rental 43,250 4,387 122 47,759
Services 13,092 924 387 14,403
Total Operating Expenses 56,342 5,311 509 62,162
General & Administrative
Site Rental 4,657 3,256 --- 7,913
Services 15,199 --- 778 15,977
Total General & Administrative 19,856 3,256 778 23,890
Operating Cash Flow 76,424 6,429 (1,220) 81,633
Corporate Development --- --- 787 787
Add: Non-Cash Compensation 1,513 107 133 1,753
Adjusted EBITDA 77,937 6,536 (1,874) 82,599
Quarter Ended 6/30/05
CCUSA CCAL EmB CCIC
Gross Margins:
Site Rental 68% 67% N/M 67%
Services 31% 47% N/M 31%
Operating Cash Flow Margins 50% 43% N/M 49%
Adjusted EBITDA Margin 51% 44% N/M 49%
Reconciliation of Non-GAAP Financial Measure (Adjusted EBITDA) to GAAP
Financial Measure:
(in $ thousands)
Quarter Ended
09/30/2004 12/31/2004 03/31/2005 06/30/2005
Net income (loss) $450,656 $(88,129) $(128,761) $(227,451)
Income (loss) from
discontinued operations,
net of tax (509,140) 1,065 1,499 (2,347)
Minority interests 544 (1,154) (1,275) (798)
Credit (provision)
for income taxes (6,856) 149 144 147
Interest expense,
amortization of deferred
financing costs 52,281 40,599 39,269 35,393
Interest and other income
(expense) 13,552 37,985 83,017 202,635
Depreciation, amortization
and accretion 69,925 72,424 72,172 72,712
Operating non-cash
compensation charges 1,442 3,228 1,548 1,753
Asset write-down charges --- 3,836 436 555
Restructuring charges
(credits) (445) 4,207 8,477 ---
Adjusted EBITDA $71,959 $74,210 $76,526 $82,599
CCI FACT SHEET Q2 2005
$ in thousands
Q2 '04 Q2 '05 % Change
CCUSA
Site Rental Revenue $121,058 $133,540 10%
Ending Sites 10,608 10,606 0%
CCAL
Site Rental Revenue $11,449 $13,260 16%
Ending Sites 1,388 1,388 0%
CC EmB
Site Rental Revenue $0 $67 N/A
Ending Sites --- --- N/A
TOTAL CCIC
Site Rental Revenue $132,507 $146,867 11%
Ending Sites 11,996 11,994 0%
Ending Cash and Investments $192,657 $258,962 *
Debt
Bank Debt $1,455,385 $0
Bonds $1,718,752 $2,028,613
6 1/4% & 8 1/4% Convertible
Preferred Stock $507,371 $508,709
Total Debt $3,681,508 $2,537,322
Leverage Ratios
Net Bank Debt / LQA EBITDA N/A N/A
Net Bank Debt + Bonds / LQA EBITDA 10.4X 5.4X
Total Net Debt / LQA EBITDA 12.2X 6.9X
Last Quarter Annualized Adjusted
EBITDA $285,984 $330,396
*Excludes Restricted Cash of $84.2 million
SOURCE Crown Castle International Corp.
-0- 08/02/2005
/CONTACT: W. Benjamin Moreland, CFO, or Jay Brown, Treasurer, both of
Crown Castle International Corp., +1-713-570-3000/
/Web site: http://www.crowncastle.com /
(CCI)
CO: Crown Castle International Corp.
ST: Texas
IN: CPR TLS FIN
SU: ERN CCA ERP FNC
CJ-CD
-- DATU028 --
3786 08/02/2005 16:01 EDT http://www.prnewswire.com